UST Law Case Digest Compendium 2011 Cases PDF

UNIVERSITY OF SANTO TOMAS
DEAN’S CIRCLE 2017

FACULTY OF CIVIL LAW
CASE DIGEST COMPENDIUM
2011 CASES
DEAN’S CIRCLE 2017
Members:
Agcaoili, Karlyn Mae
Apostol, Jinny
Arenas, Janine Aira
Arias, Meliza
Badua, Karina
Bonsol, Ninna
Barquez, Loverly
Cimatu, Jyrus
De Asis, Camille
De La Rosa, Joresa
Flores, Steffi Nicole
Hilario, Jonel
Infantado, Bainca Nerizza
Jabal, Jasmin Micah
Javier, Lloyd Danielle
Kapunan, Katherine
Lopez, Eunice
Manuel, Kenneth
Marasigan, Mariella
Panganiban, Audrey
Pedernal, Janine
Prudente, Maica
Questin, Clarice
Salazar, Louie
Terre, Gena Myrtle

DEAN’S CIRCLE 2017 ii
Condensed Table of Contents – per Bar Subject
POLITICAL AND PUBLIC INTERNATIONAL LAW ................................................ 1

LABOR AND SOCIAL LEGISLATION........................................................................ 96
CIVIL LAW .................................................................................................................. 204
TAXATION LAW ........................................................................................................ 327
MERCANTILE LAW................................................................................................... 347
CRIMINAL LAW ......................................................................................................... 375
REMEDIAL LAW ........................................................................................................ 514
LEGAL ETHICS AND PRACTICAL EXERCISES ................................................... 707

DEAN’S CIRCLE 2017 iii
Topical Table of Contents

EXECUTIVE DEPARTMENT ............................................................................................................. 1
EXPROPRIATION ............................................................................................................................... 6
IMPEACHMENT ................................................................................................................................. 12
JUDICIARY DEPARTMENT ............................................................................................................ 14
BILL OF RIGHTS................................................................................................................................ 20
LAW ON PUBLIC OFFICERS ........................................................................................................... 29
ADMINISTRATIVE LAW ................................................................................................................. 46
ELECTION LAW ................................................................................................................................. 74
LOCAL GOVERNMENT CODE ........................................................................................................ 78
COMMISSION ON AUDIT ................................................................................................................ 83
PUBLIC INTERNATIONAL LAW ................................................................................................... 89
NATURAL RESOURCES ................................................................................................................... 91
OMBUDSMAN .................................................................................................................................... 92
GENERAL PRINCIPLES .................................................................................................................... 96
NATURE OF LABOR CASES ............................................................................................................ 98
RIGHT TO EQUAL PROTECTION OF THE LAWS .................................................................. 101
EMPLOYER-EMPLOYEE RELATIONSHIP ............................................................................... 102
RECRUITMENT............................................................................................................................... 112
SECURITY OF TENURE................................................................................................................. 117
RIGHT TO SELF-ORGANIZATION ............................................................................................. 119
RIGHT TO COLLECTIVE BARGAINING .................................................................................... 121
RIGHT TO PEACEFUL CONCERTED ACTIVITIES ................................................................. 125
UNFAIR LABOR PRACTICES ....................................................................................................... 128
TERMINATION ............................................................................................................................... 130
ILLEGAL DISMISSAL ..................................................................................................................... 137
CONSTRUCTIVE DISMISSAL ...................................................................................................... 149
REDUNDANCY, RETRENCHMENT AND CLOSURE ............................................................... 157

DEAN’S CIRCLE 2017 iv
ABANDONMENT ............................................................................................................................ 159
DUE PROCESS ................................................................................................................................. 162
NATIONAL LABOR RELATIONS COMMISSION ..................................................................... 166
REMEDIES........................................................................................................................................ 168
RELIEFS FOR ILLEGAL DISMISSAL .......................................................................................... 169
SEPARATION PAY ......................................................................................................................... 173
EXECUTION OF JUDGEMENT ..................................................................................................... 176
APPEAL............................................................................................................................................. 177
SOCIAL LEGISLATION .................................................................................................................. 182
AGRARIAN REFORM..................................................................................................................... 190
CIVIL LAW .................................................................................................................. 204
GENERAL PRINCIPLES ................................................................................................................. 204
PERSONS AND FAMILY RELATIONS ........................................................................................ 208
PROPERTY ...................................................................................................................................... 215
OBLIGATIONS................................................................................................................................. 224
CONTRACTS .................................................................................................................................... 232
SALES ................................................................................................................................................ 247
LEASE ................................................................................................................................................ 252
AGENCY ............................................................................................................................................ 255
TRUST ............................................................................................................................................... 258
CREDIT TRANSACTIONS ............................................................................................................. 260
SUCCESSION .................................................................................................................................... 278
LAND TITLES AND DEEDS .......................................................................................................... 279
TORTS AND DAMAGES ................................................................................................................ 307
TAXATION LAW ........................................................................................................ 327
INCOME TAXATION ...................................................................................................................... 327
VALUE-ADDED TAX ...................................................................................................................... 332
EXCISE TAXES ................................................................................................................................ 338
DOCUMENTARY TAXES............................................................................................................... 339
REAL PROPERTY TAXATION .................................................................................................... 342
JUDICIAL REMEDIES .................................................................................................................... 343
REVISED RULES OF COURT OF TAX APPEALS ..................................................................... 344

DEAN’S CIRCLE 2017 v
MERCANTILE LAW................................................................................................... 347
NEGOTIABLE INSTRUMENTS LAW ......................................................................................... 347
INSURANCE LAW ........................................................................................................................... 348
TRANSPORTATION LAW ............................................................................................................ 348
MARITIME COMMERCE ............................................................................................................... 349
CORPORATION LAW .................................................................................................................... 352
INTELLECTUAL PROPERTY LAW............................................................................................. 362
SECURITIES AND REGULATION CODE ................................................................................... 364
CORPORATE REHABILITATION ............................................................................................... 366
CONSUMER ACT ............................................................................................................................. 371
BANK SECRECY LAW .................................................................................................................... 372
CRIMINAL LAW ......................................................................................................... 375
CRIMINAL LAW I ........................................................................................................................... 375
CRIMINAL LAW II .......................................................................................................................... 399
CRIMES AGAINST PUBLIC INTEREST ..................................................................................... 399
CRIMES COMMITTED BY PUBLIC OFFICERS ........................................................................ 405
CRIMES AGAINST PERSONS ....................................................................................................... 408
CRIMES AGAINST PERSONAL LIBERTY AND SECURITY .................................................. 458
CRIMES AGAINST PROPERTY ................................................................................................... 462
ILLEGAL MARRIAGES .................................................................................................................. 469
CRIMES AGAINST HONOR .......................................................................................................... 471
SPECIAL PENAL LAWS ................................................................................................................. 473
REMEDIAL LAW ........................................................................................................ 514
CRIMINAL PROCEDURE .............................................................................................................. 514
CIVIL PROCEDURE ........................................................................................................................ 536
ALTERNATIVE DISPUTE RESOLUTION .................................................................................. 655
EVIDENCE ........................................................................................................................................ 656
SPECIAL PROCEEDINGS .............................................................................................................. 695
LEGAL PROFESSION AND THE PRACTICE OF LAW ............................................................ 707
DUTIES AND RESPONSIBILITIES OF A LAWYER ................................................................. 711

DEAN’S CIRCLE 2017 vi
2004 RULES ON NOTARIAL PRACTICE .................................................................................. 722
JUDICIAL ETHICS........................................................................................................................... 724
ETHICS OF OTHER COURT EMPLOYEES ................................................................................ 745

DEAN’S CIRCLE 2017 vii
Detailed Table of Contents

EXECUTIVE DEPARTMENT ............................................................................................................. 1
DATU ZALDY UY AMPATUAN, et al. v. HON. RONALDO PUNO, et al.................................................... 1
ATTY. ROMULO B. MACALINTAL v. PRESIDENTIAL ELECTORAL TRIBUNAL ................................ 2
BARANGAY CAPTAIN BEDA TORRECAMPO v. METROPOLITAN WATERWORKS AND
SEWERAGE SYSTEM ................................................................................................................................................ 3
PROF. MERLIN MAGALLONA, et al. v. HON. EDUARDO ERMITA, et al. ............................................... 4
EXPROPRIATION ............................................................................................................................... 6
ANUNCIACION VDA. DE OUANO, MARIANO P. OUANO, et al. v. THE REPUBLIC OF THE
PHILIPPINES, THE MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY, AND THE
REGISTER OF DEEDS FOR THE CITY OF CEBU ............................................................................................. 6
HACIENDA LUISITA, INCORPORATED, et al. v. PRESIDENTIAL AGRARIAN REFORM
COUNCIL, et al............................................................................................................................................................. 7
REPUBLIC represented by the Department of Public Works and Highways (DPWH), v. SPS.
TAN SONG BOK and JOSEFINA S. TAN, et al. ................................................................................................ 11
IMPEACHMENT ................................................................................................................................. 12
MA. MERCEDITAS N. GUTIERREZ v. THE HOUSE OF REPRESENTATIVES COMMITTEE ON
JUSTICE, et al. ............................................................................................................................................................ 12
JUDICIARY DEPARTMENT ............................................................................................................ 14
ATTY. ELIAS OMAR A. SANA v. CAREER EXECUTIVE SERVICE BOARD ........................................... 14
OFFICE OF THE DEPUTY OMBUDSMAN FOR LUZON, HONORABLE VICTOR C. FERNANDEZ,
in his capacity as Deputy Ombudsman for Luzon, and THE GENERAL INVESTIGATION
BUREAU-A, Represented by MARIA OLIVIA ELENA A. ROXAS v. JESUS D. FRANCISCO, SR. ... 15
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, et al. v. CONCERNED RESIDENTS OF
MANILA BAY ............................................................................................................................................................. 17
HACIENDA LUISITA INCORPORATED v. PRESIDENTIAL AGRARIAN REFORM COUNCIL;
SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN REFORM;
ALYANSA NG MGA MANGGAGAWANG BUKIND NG HACIENDA LUISITA, RENE GALANG,
NOEL MALLARI, AND JULIO SUNIGA AND HIS SUPERVISORY GROUP OF THE HACIENDA
LUISITA, INC. AND WINDSOR ANDAYA ......................................................................................................... 18
BILL OF RIGHTS................................................................................................................................ 20
Ex Post Facto and Bill of Attainder ....................................................................................................................... 20
BUREAU OF CUSTOMS EMPLOYEES ASSOCIATION (BOCEA) v. MARGARITO B. TEVES, et al.,
........................................................................................................................................................................................ 20

DEAN’S CIRCLE 2017 viii
Search and Seizure ...................................................................................................................................................... 21
ELENITA C. FAJARDO v. PEOPLE OF THE PHILIPPINES ........................................................................ 21
PEOPLE OF THE PHILIPPINES v. ROLANDO S. DELOS REYES, alias Botong AND RAYMUNDO
G. REYES, alias Mac-Mac ....................................................................................................................................... 22
PEOPLE OF THE PHILIPPINES v. ERNESTO UYBOCO y RAMOS .......................................................... 24
Due Process .................................................................................................................................................................... 25
PHILIPPINE AMUSEMENT AND GAMING CORPORATION v. COURT OF APPEALS and MIA
MANAHAN.................................................................................................................................................................. 25
ROSEMARIE SALMA ARAGONCILLO-MOLOK V. SITY AISA BARANGAI MOLOK .......................... 26
Right to Information ................................................................................................................................................... 27
RE: PETITION FOR RADIO AND TELEVISION COVERAGE OF THE MULTIPLE MURDER CASES
AGAINST MAGUINDANAO GOVERNOR ZALDY AMPATUAN, et al.,.................................................... 27
LAW ON PUBLIC OFFICERS ........................................................................................................... 29
Accountability of Public Officers ........................................................................................................................... 29
CORAZON TENORIO v. ALYN C. PERLAS ....................................................................................................... 29
OFFICE OF THE COURT ADMINISTRATOR v. HERMENEGILDO I. MARASIGAN ........................... 30
ATTY. RUTILLO B. PASOK v. CARLOS P. DIAZ ............................................................................................. 31
OFFICE OF THE COURT ADMINISTRATOR (OCA) v. ATTY. TEOTIMO D. CRUZ ............................ 32
OFFICE OF THE COURT ADMINISTRATOR v. JOSE M. RAMANO ......................................................... 33
NILDA VERGINESA-SUAREZ v. JUDGE RENATO J. DILAG AND COURT STENOGRAPHER III
CONCEPCION A. PASCUA ..................................................................................................................................... 34
RE: LETTER-COMPLAINT OF MR. RECARREDO S. VALENZUELA, CLERK IV, PERSONNEL
DIVISION, OAS-OCA AGAINST MR. RICARDO R. GIGANTO, UTILITY WORKER II, PERSONNEL
DIVISION, OAS-OCA ................................................................................................................................................ 35
THE CIVIL SERVICE COMMISSION v. RICHARD G. CRUZ ........................................................................ 36
REINA EDENLYNE GARCIA v. ROBERT V. ALEJO ....................................................................................... 37
REPORT ON THE FINANCIAL AUDIT CONDUCTED ON THE BOOKS OF ACCOUNT OF SONIA L.
DY AND ATTY. GRACIANO D. CUANICO, JR., REGIONAL TRIAL COURT, CATARMAN,
NORTHERN SAMAR. .............................................................................................................................................. 38
PRESIDENTIAL ANTI-GRAFT COMMISSION and THE OFFICE OF THE PRESIDENT v.
SALVADOR PLEYTO ............................................................................................................................................... 39
FILIPINA SAMSON v. JULIA RESTRIVERA ..................................................................................................... 40
VICTOR R. REYES, substituted by his heirs, CLARIBEL G. REYES, et al. v. COURT OF APPEALS,
et al. ............................................................................................................................................................................... 42
RE: GROSS VIOLATION OF CIVIL SERVICE LAW ON THE PROHIBITION AGAINST DUAL
EMPLOYMENT AND DOUBLE COMPENSATION IN THE GOVERNMENT SERVICE

DEAN’S CIRCLE 2017 ix
COMMITTED BY MR. EDUARDO V. ESCALA, SC CHIEF JUDICIAL STAFF OFFICER, SECURITY
DIVISION, OFFICE OF ADMINISTRATIVE SERVICES ................................................................................ 43
PETRA MARTINEZ v. FILOMENA VILLANUEVA ......................................................................................... 44
OFFICE OF THE ADMINISTRATIVE SERVICES, OFFICE OF THE COURT ADMINISTRATOR v.
LEDA URI .................................................................................................................................................................... 45
GOLDEN SUN FINANCE CORPORATION v. RICARDO ALBANO............................................................ 46
ADMINISTRATIVE LAW ................................................................................................................. 46
BEATRIZ B. OÑATE v. SEVERINO G. IMATONG .......................................................................................... 47
LEAVE DIVISION-OAS, OFFICE OF THE COURT ADMINISTRATOR v. LARAINE I. CALINGASAN
........................................................................................................................................................................................ 47
ARTHUR M. GABON V. REBECCA P. MERKA, Clerk of Court II, Municipal Trial Court,
Liloan, Southern Leyte .......................................................................................................................................... 48
ATTY. LETICIA E. ALA v. JUDGE SOLIVER C. PERAS, et al. ..................................................................... 49
FRANCISCO C. TAGUINOD v. ROLANDO TOMAS ........................................................................................ 51
CONCERNED CITIZEN v. MARIA CONCEPCION M. DIVINA ................................................................... 53
METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM v. GABRIEL ADVINCULA, et al. 54
GREGORIO R. VIGILAR, SECRETARY OF THE DEPARTMENT OF PUBLIC WORKS AND
HIGHWAYS (DPWH), et al. v. ARNULFO D. AQUINO................................................................................ 56
OFFICE OF THE OMBUDSMAN v. COURT OF APPEALS and DINAH C. BARRIGA ......................... 57
THE BOARD OF TRUSTEES OF THE GOVERNMENT SERVICE INSURANCE SYSTEM, AND
WINSTON F. GARCIA v. ALBERT M. VELASCO AND MARIO L. MOLINA ........................................... 57
OFFICE OF THE DEPUTY OMBUDSMAN FOR LUZON v. JESUS D. FRANCISCO.............................. 59
PHILIPPINE NATIONAL RAILWAYS v. KANLAON CONSTRUCTION ENTERPRISES CO., INC. . 60
COURT OF APPEALS BY: COC TERESITA R. MARIGOMEN v. ENRIQUE E. MANABAT, JR. ........ 61
JEROME JAPSON v. CIVIL SERVICE COMMISSION ..................................................................................... 61
PHILIPPINE CHARITY SWEEPSTAKES OFFICE BOARD OF DIRECTORS AND REYNALDO P.
MARTIN v. MARIE JEAN C. LAPID .................................................................................................................... 63
RIMANDO A. GANNAPAO v. CIVIL SERVICE COMMISSION (CSC), et al. ........................................... 64
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) v. ARWIN T. MAYORDOMO .................... 65
SPOUSES RICARDO HIPOLITO, JR. and LIZA HIPOLITO v. TERESITA CINCO, et al. ..................... 67
EVELINA C. BANAAG v. OLIVIA C. ESPELETA, ............................................................................................ 68
ISABELO L. GALANG V. LAND BANK OF THE PHILIPPINES .................................................................. 69
CARLOS COTIANGCO, et al. v. THE PROVINCE OF BILIRAN AND THE COURT OF APPEALS .. 71
RE: THEFT OF THE USED GALVANIZED IRON (GI) SHEETS IN THE SC
COMPOUND, BAGUIO CITY ................................................................................................................................. 72
ELECTION LAW ................................................................................................................................. 74

DEAN’S CIRCLE 2017 x
CONSTANCIO F. MENDOZA v. SENEN C. FAMILARA and COMMISSION ON ELECTIONS.......... 74
SERGIO G. AMORA, JR. v. COMMISSION ON ELECTIONS and ARNIELO S. OLANDRIA ............... 75
CERIACO BULILIS v. VICTORINO NUEZ ......................................................................................................... 75
Quo warranto................................................................................................................................................................. 76
HON. LUIS MARIO M. GENERAL, COMMISSIONER, NATIONAL POLICE COMMISSION v. HON.
ALEJANDRO S. URRO, IN HIS CAPACITY AS THE NEW APPOINTEE VICE HEREIN
PETITIONER HON. LUIS MARIO M. GENERAL, NATIONAL POLICE COMMISSION ...................... 76
DANILO MORO v. GENEROSO REYES DEL CASTILLO, JR........................................................................ 77
LOCAL GOVERNMENT CODE ........................................................................................................ 78
RODOLFO G. NAVARRO et al. v. EXECUTIVE SECRETARY EDUARDO ERMITA et al. .................. 79
NEW SUN VALLEY HOMEOWNERS ASSOCIATION, INC. v. SANGGUNIANG BARANGAY, et al.
........................................................................................................................................................................................ 81
Local Taxation ............................................................................................................................................................... 81
STA. LUCIA REALTY & DEVELOPMENT, INC., V. CITY OF PASIG, MUNICIPALITY OF CAINTA,
PROVINCE OF RIZAL .............................................................................................................................................. 82
COMMISSION ON AUDIT ................................................................................................................ 83
MANOLITO AGRA, et al. v. COMMISSION ON AUDIT ................................................................................ 83
BOY SCOUTS OF THE PHILIPPINES v. COMMISSION ON AUDIT ......................................................... 85
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), et al. v. COMMISSION ON AUDIT
(COA), et al. ................................................................................................................................................................ 86
PUBLIC INTERNATIONAL LAW ................................................................................................... 89
BAYAN MUNA v. ALBERTO ROMULO AND BLAS F. OPLE...................................................................... 89
NATURAL RESOURCES ................................................................................................................... 91
DIAMOND DRILLING CORPORATION OF THE PHILIPPINES v. NEWMONT PHILIPPINES
INCORPORATED ...................................................................................................................................................... 91
OMBUDSMAN .................................................................................................................................... 92
OFFICE OF THE OMBUDSMAN v. ULDARICO ANDUTAN, JR. ................................................................ 92
ELOISA TOLENTINO v. ATTY. ROY LOYOLA, et al. .................................................................................... 93
MARCELO G. GANADEN, et al. v. THE HONORABLE COURT OF APPEALS, et al. .......................... 94
GENERAL PRINCIPLES .................................................................................................................... 96
ELECTROMAT MANUFACTURING AND RECORDING CORPORATION v. HON. CIRIACO
LAGUNZAD, et al. ..................................................................................................................................................... 96
PABLO POLSOTIN, JR., et al. v. DE GUIA ENTERPRISES, INC................................................................. 96
NATURE OF LABOR CASES ............................................................................................................ 98

DEAN’S CIRCLE 2017 xi
WILFREDO Y. ANTIQUINA v. MAGSAYSAY MARITIME CORPORATION and/or MASTERBULK,
PTE., LTD. ................................................................................................................................................................... 98
JOBEL ENTERPRISES AND/OR MR. BENEDICT LIM v. NATIONAL LABOR RELATIONS
COMMISSION AND ERIC MARTINEZ............................................................................................................ 100
RIGHT TO EQUAL PROTECTION OF THE LAWS .................................................................. 101
CLAUDIO S. YAP v. THENAMARIS SHIPS MANAGEMENT and INTERMARE MARITIME
AGENCIES, INC. ..................................................................................................................................................... 101
EMPLOYER-EMPLOYEE RELATIONSHIP ............................................................................... 102
MARTICIO SEMBLANTE AND DUBRICK PILAR v. COURT OF APPEALS, 19THDIVISION, now
SPECIAL FORMER 19TH DIVISION, GALLERA DE MANDAUE / ......................................................... 102
SPOUSES VICENTE and MARIA LUISA LOOT............................................................................................ 102
Control ........................................................................................................................................................................... 103
GREGORIO V. TONGKO v. THE MANUFACTURERS LIFE INSURANCE CO. (PHILS.), INC. and
RENATO A. VERGEL DE DIOS .......................................................................................................................... 103
AQUINAS SCHOOL v. SPS. JOSE INTON and MA. VICTORIA S. INTON, et al. ................................ 104
CESAR C. LIRIO, doing business under the name and style of CELKOR AD SONICMIX v.
WILMER D. GENOVIA ......................................................................................................................................... 105
Probationary Employment ................................................................................................................................... 106
HACIENDA PRIMERA DEVELOPMENT CORPORATION and ANNA KATRINA E. HERNANDEZ
v. MICHAEL S. VILLEGAS ................................................................................................................................... 106
St. PAUL COLLEGE QUEZON CITY et al. v. REMIGIO MICHAEL A. ANCHETA II AND CYNTHIA
A. ANCHETA ........................................................................................................................................................... 107
TAMSONS ENTERPRISES, INC., NELSON LEE, LILIBETH ONG and JOHNSON NG vs. COURT OF
APPEALS and ROSEMARIE L. SY .................................................................................................................... 109
Project Employment ................................................................................................................................................ 109
LEYTE GEOTHERMAL POWER PROGRESSIVE EMPLOYEES UNION- ALU- TUCP v.
PHILIPPINE NATIONAL OIL COMPANY- ENERGY DEVELOPMENT CORPORATION ............... 109
Managerial Employment ........................................................................................................................................ 111
CLIENTLOGIC PHILPPINES, INC. et al. v. BENEDICT CASTRO ........................................................... 111
RECRUITMENT............................................................................................................................... 112
Employment Agency ................................................................................................................................................ 112
JONES INTERNATIONAL MANPOWER SERVICES, INC. v. BELLA AGCAOILI-BARIT................ 112
Illegal Recruitment ................................................................................................................................................... 113
DELIA D. ROMERO v. PEOPLE OF THE PHILIPPINES, et al. ................................................................ 113
PEOPLE OF THE PHILIPPINES v. TERESITA “TESSIE” LAOGO ......................................................... 114
PEOPLE OF THE PHILIPPINES v. DOLORES OCDEN.............................................................................. 115

DEAN’S CIRCLE 2017 xii
SECURITY OF TENURE................................................................................................................. 117
SUPREME STEEL CORPORATION v. NAGKAKAISANG MANGGAGAWA NG SUPREME
INDEPENDENT UNION (NMS-IND-APL) .................................................................................................... 117
NIPPON HOUSING PHIL. INC., AND/OR TADAHI OTA, HOROSHI TAKADA, et al. v. MAIAH
ANGELA LEYNES .................................................................................................................................................. 118
RIGHT TO SELF-ORGANIZATION ............................................................................................. 119
Certification Election ............................................................................................................................................... 119
LEGEND INTERNATIONAL RESORTS LIMITED v. KILUSANG MANGGAGAWA NG LEGEND 119
SAMAHANG MANGGAGAWA SA CHARTER CHEMICAL SOLIDARITY OF UNIONS IN THE
PHILIPPINES FOR EMPOWERMENT AND REFORMS (SMCC-SUPER) v. CHARTER CHEMICAL
and COATING CORPORATION ........................................................................................................................ 120
RIGHT TO COLLECTIVE BARGAINING .................................................................................... 121
Union Registration ................................................................................................................................................... 121
THE HERITAGE HOTEL MANILA v. NATIONAL UNION OF WORKERS IN THE HOTEL,
RESTAURANT AND ALLIED INDUSTRIES-HERITAGE HOTEL MANILA SUPERVISORS
CHAPTER ................................................................................................................................................................. 121
CIRTEK EMPLOYEES LABOR UNION-FEDERATION OF FREE WORKERS v. CIRTEK
ELECTRONICS, INC. ............................................................................................................................................. 122
Attorney’s Fees in favor of Union Members .................................................................................................. 123
KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-EAST ZONE
UNION and EDUARDO BORELA, representing its members vs. MANILA WATER COMPANY,
INC. ............................................................................................................................................................................. 123
Collective Bargaining Agreement ....................................................................................................................... 124
GENERAL MILLING CORPORATION-INDEPENDENT LABOR UNION (GMC-ILU) v. GENERAL
MILLING CORPORATION .................................................................................................................................. 124
RIGHT TO PEACEFUL CONCERTED ACTIVITIES ................................................................. 125
Strike .............................................................................................................................................................................. 125
YOLITO FADRIQUELAN, et al. v. MONTEREY FOODS CORPORATION / MONTEREY FOODS
CORPORATION v. BUKLURAN NG MGA MANGGAGAWA SA MONTEREY-ILAW AT BUKLOD
NG MANGGAGAWA, et al. .................................................................................................................................. 125
MAGDALA MULTIPURPOSE & LIVELIHOOD COOPERATIVE and SANLOR MOTORS CORP. v.
KILUSANG MANGGAGAWA NG LGS, MAGDALA MULTIPURPOSE & LIVELIHOOD
CORPERATIVE (KMLMS) and UNION MEMBERS/ STRIKERS ........................................................... 127
UNFAIR LABOR PRACTICES ....................................................................................................... 128
PRINCE TRANSPORT, INC. and RENATO CLAROS v. DIOSDADO GARCIA, et al. ........................ 128
Corporate Entities..................................................................................................................................................... 129
PRINCE TRANSPORT, INC. and RENATO CLAROS v. DIOSDADO GARCIA, et al. ........................ 129

DEAN’S CIRCLE 2017 xiii
TERMINATION ............................................................................................................................... 130
JUST CAUSES ............................................................................................................................................................... 130
Loss of Confidence .................................................................................................................................................... 130
JAMES BEN L. JERUSALEM v. KEPPEL MONTE BANK, et al................................................................ 130
THE COCA-COLA EXPORT CORPORATION v. CLARITA P. GACAYAN ............................................. 131
Infractions .................................................................................................................................................................... 132
JERRY MAPILI v. PHILIPPINE RABBIT BUS LINES, INC./NATIVIDAD NICSE .............................. 132
Misconduct .................................................................................................................................................................. 133
SAMAHAN NG MGA MANGGAGAWA SA HYATT (SAMASAH-NUWHRAIN) v. HON. VOLUNTARY
ARBITRATORBUENAVENTURA C. MAGSALIN and HOTEL ENTERPRISES OF THE PHILIPPINES, INC., /
SAMAHAN NG MGA MANGGAGAWA SA HYATT (SAMASAH-NUWHRAIN) v. HOTEL
ENTERPRISES OF THE PHILIPPINES, INC. ................................................................................................ 133
NISSAN MOTORS PHILS. INC. v. VICTORINO ANGELO ......................................................................... 135
Habitual Neglect of Duties ..................................................................................................................................... 136
PHILIPPINE NATIONAL BANK vs. DAN PADAO ...................................................................................... 136
ILLEGAL DISMISSAL ..................................................................................................................... 137
SUNRISE HOLIDAY CONCEPTS, INC., v. TERESA A. ARUGAY ............................................................. 137
ALERT SECURITY AND INVESTIGATION AGENCY, INC. et al v. SAIDALI PASAWILAN et al.
..................................................................................................................................................................................... 138
JOSE MEL BERNARTE v. PHILIPPINE BASKETBALL ASSOCIATION (PBA), JOSE EMMANUEL
M. EALA, and PERRY MARTINEZ ................................................................................................................... 139
GRANDTEQ INDUSTRIAL STEEL PRODUCTS, INC., et al. v. ANNALIZA ESTRELLA .................. 140
SANDEN AIRCON PHILIPPINES and ANTONIO ANG v. LORESSA ROSALES ................................ 142
EXODUS INTERNATIONAL CONSTRUCTION CORPORATION AND ANTONIO P. JAVALERA v.
GUILLERMO BISCOCHO, et al. ......................................................................................................................... 143
ATLANTA INDUSTRIES, INC. and/or ROBERT CHAN v. APRILITO R. SEBOLINO, et al. ......... 144
PRIMO E. CAONG, JR., et al. v. AVELINO REGUALOS .............................................................................. 145
NELSON A. CULILI v. EASTERN TELECOMMUNICATIONS PHILIPPINES, INC. et al. ................ 147
CONSTRUCTIVE DISMISSAL ...................................................................................................... 149
EMIRATE SECURITY AND MAINTENANCE SYSTEMS, INC. and ROBERTO A. YAN v. GLENDA
A. MENESE .............................................................................................................................................................. 149
NATIONWIDE SECURITY AND ALLIED SERVICES, INC. v. RONALD P. VALDERAMA.............. 150
WILLIAM ENDELISEO BARROGA V. DATA CENTER COLLEGE OF THE PHILIPPINES and
WILFRED BACTAD............................................................................................................................................... 151
NIA JEWELRY MANUFACTURING OF METAL ARTS, INC. (otherwise known as NIA
MANUFACTURING AND METAL ARTS, INC.) and ELISEA B. ABELLA v. MADELINE C.
MONTECILLO and LIZA M. TRINIDAD......................................................................................................... 153

DEAN’S CIRCLE 2017 xiv
UNITED LABORATORIES, INC. v. JAIME DOMINGO substituted by his spouse CARMENCITA
PUNZALAN DOMINGO et al. ............................................................................................................................. 154
MARIO B. DIMAGAN v. DACWORKS UNITED, INCORPORATED AND/OR DEAN A. CANCINO
..................................................................................................................................................................................... 155
JHORIZALDY UY v. CENTRO CERAMICA CORPORATION and/or RAMONITA Y. SY and
MILAGROS U. GARCIA ........................................................................................................................................ 156
REDUNDANCY, RETRENCHMENT AND CLOSURE ............................................................... 157
GENUINO ICE COMPANY, INC. et al. v. ERIC LAYA and EDDIE BOY SODELA .............................. 157
PLASTIMER INDUSTRIAL CORPORATION AND TEO KEE BIN v. NATALIA C. GOPO, et al. ... 158
ABANDONMENT ............................................................................................................................ 159
FUNCTIONAL, INC. vs. SAMUEL C. GRANFIL ............................................................................................ 159
E.G & I. CONSTRUCTION CORPORATION AND EDSEL GALEOS v. ANANIAS P. SATO, NILO
BERDIN, et al. ......................................................................................................................................................... 160
DUE PROCESS ................................................................................................................................. 162
Notice Requirement ................................................................................................................................................. 162
ROBINSONS GALLERIA/ROBINSONS SUPERMARKET CORP. and/or JESS MANUEL v. IRENE
R. RANCHEZ............................................................................................................................................................ 162
ROMULO B. DELA ROSA v. MICHAELMAR PHILIPPINES, INC., et al. .............................................. 163
QUIRICO LOPEZ v. ALTURAS GROUP OF COMPANIES and/or MARLITO UY ............................. 165
NATIONAL LABOR RELATIONS COMMISSION ..................................................................... 166
AGG TRUCKING AND/OR ALEXANG GAEID v. MELANIO B. YUAG .................................................. 166
REMEDIES........................................................................................................................................ 168
BERNADETH LONDONIO and JOAN CORCORO v. BIO RESEARCH, INC. and WILSON Y. ANG
..................................................................................................................................................................................... 168
RELIEFS FOR ILLEGAL DISMISSAL .......................................................................................... 169
Reinstatement ............................................................................................................................................................ 169
PFIZER, INC. And REY GERARDO BACARRO, et al. v. GERALDINE VELASCO.............................. 169
Accrued Wages........................................................................................................................................................... 170
ISLRIZ TRADING/VICTOR HUGO LU v. EFREN CAPADA, et al. ......................................................... 170
Backwages ................................................................................................................................................................... 172
BPI EMPLOYEES UNION – METRO MANILA and ZENAIDA UY v. BANK OF THE PHILIPPINE
ISLANDS ................................................................................................................................................................... 172
SEPARATION PAY ......................................................................................................................... 173
JULIET G. APACIBLE v. MULTIMED INDUSTRIES INCORPORATED, et al. .................................... 173
DUP SOUND PHILS. and/or MANUEL TAN v. COURT OF APPEALS and CIRILO A. PIAL ........ 174

DEAN’S CIRCLE 2017 xv
EXECUTION OF JUDGEMENT ..................................................................................................... 176
PAQUITO V. ANDO v. ANDRESITO Y. CAMPO, et al. ............................................................................... 176
APPEAL............................................................................................................................................. 177
BANAHAW BROADCASTING CORPORATION v. CAYETANO PACANA III, et al. ......................... 177
RODOLFO LUNA v. ALLADO CONSTRUCTION CO., INC., and/or RAMON ALLADO .................. 178
UNIVERSITY PLANS INCORPORATED v. BELINDA P. SOLANO, et al.............................................. 179
MIGUEL DELA PENA BARAIRO v. OFFICE OF THE PRESIDENT and MST MARINE SERVICES
(PHILS.), INC........................................................................................................................................................... 181
SOCIAL LEGISLATION .................................................................................................................. 182
Employee’s Compensation .................................................................................................................................... 182
GOVERNMENT SERVICE INSURANCE SYSTEM v. MANUEL P. BESITAN ...................................... 182
Permanent Disability ............................................................................................................................................... 183
CARMELITO N. VALENZONA v. FAIR SHIPPING CORPORATION and/or SEJIN LINES
COMPANY LIMITED ............................................................................................................................................ 183
FIL-STAR MARITIME CORPORATION, CAPTAIN VICTORIO S. MIGALLOS and
GRANDSLAM ENTERPRISE CORPORATION v. HANZIEL O. ROSETE ............................................. 184
Disability Benefits ..................................................................................................................................................... 186
COASTAL SAFEWAY MARINE SERVICES, INC. v. ELMER T. ESGUERRA ....................................... 186
GILBERT QUIZORA vs. DENHOLM CREW MANAGEMENT (PHILIPPINES), INC. ....................... 187
Death Benefits ............................................................................................................................................................ 188
MARITIME FACTORS INC. v. BIENVENIDO R. HINDANG ..................................................................... 188
State Insurance Fund............................................................................................................................................... 189
GOVERNMENT SERVICE INSURANCE SYSTEM v. JUM ANGEL ......................................................... 189
AGRARIAN REFORM..................................................................................................................... 190
JULIAN LEBURDO and REYNALDO LEBRUDO v. REMEDIOS LOYOLA .......................................... 190
MILESTONE FARMS, INC. v. OFFICE OF THE PRESIDENT .................................................................. 191
LAND BANK OF THE PHILIPPINES v. DEPARTMENT OF AGRARIAN REFORM and METRACO
TELE-HYGIENIC SERVICES CORPORATION .............................................................................................. 193
APO FRUITS CORPORATION and HIJO PLANTATION, INC. v. LAND BANK OF THE
PHILIPPINES .......................................................................................................................................................... 194
LAND BANK OF THE PHILIPPINES v. HEIRS OF SEVERINO LISTANA ........................................... 195
HEIRS OF FELICIDAD VDA. DE DELA CRUZ v. HEIRS OF PEDRO T. FAJARDO ........................... 197
Tenancy ......................................................................................................................................................................... 198
LUCIA RODRIGUEZ AND PRUDENCIA RODRIGUEZ v. TERESITA V. SALVADOR....................... 198

DEAN’S CIRCLE 2017 xvi
ESTATE OF PASTOR M. SAMSON, represented by his heir ROLANDO B. SAMSON v.
MERCEDES R. SUSANO and NORBERTO R. SUSANO ............................................................................. 199
Conversion ................................................................................................................................................................... 200
AYALA LAND, INC. and CAPITOL CITIFARMS, INC v. SIMEONA CASTILLO, et al. ..................... 200
Landbank, in Expropriation Proceedings ....................................................................................................... 202
DAVAO FRUITS CORPORATION v. LAND BANK OF THE PHILIPPINES ......................................... 202
CIVIL LAW .................................................................................................................. 204
GENERAL PRINCIPLES ................................................................................................................. 204
Human Relations ....................................................................................................................................................... 204
EUSEBIO GONZALES v. PHILIPPINE COMMERCIAL AND INTERNATIONAL BANK, et al. ..... 204
PHILIPPINE REALTY AND HOLDINGS CORP. v. LEY CONSTRUCTION AND DEVELOPMENT
CORP. ......................................................................................................................................................................... 205
ALFONSO T. YUCHENGCO v. THE MANILA CHRONICLE PUBLISHING CORPORATION, et al.
..................................................................................................................................................................................... 206
PERSONS AND FAMILY RELATIONS ........................................................................................ 208
Marriage........................................................................................................................................................................ 208
ROSALINO MARABLE v. MYRNA MARABLE ............................................................................................. 208
ALAIN DIO v. MA. CARIDAD DIO .................................................................................................................... 208
CYNTHIA YAMBAO v. REPUBLIC OF THE PHILIPPINES ...................................................................... 209
JOSE REYNALDO OCHOSA v. REPUBLIC OF THE PHILIPPINES and BONA ALANO.................. 210
ESTRELLITA JULIANO-LLAVE v. REPUBLIC OF THE PHILIPPINES, et al. .................................... 211
REPUBLIC OF THE PHILIPPINES v. NESTOR GALANG ......................................................................... 212
Property Relations of the Spouses ..................................................................................................................... 213
ELENITA M. DEWARA v. SPOUSES RONNIE AND GINA LAMELA and STENILE ALVERO...... 213
PROPERTY ...................................................................................................................................... 215
Quieting of Title ......................................................................................................................................................... 215
PHIL-VILLE DEVELOPMENT AND HOUSING CORPORATION v. MAXIMO BONIFACIO, et al.
..................................................................................................................................................................................... 215
TOP MANAGEMENT PROGRAMS CORPORATION v. LUIS FAJARDO AND THE REGISTER OF
DEEDS OF LAS PIÑAS CITY .............................................................................................................................. 216
Co-Ownership ............................................................................................................................................................. 218
BETTY B. LACBAYAN v. BAYANI S. SAMOY, JR......................................................................................... 218
CO GIOK LUN, et al. v. JOSE CO, et al. ............................................................................................................ 219
Easement ...................................................................................................................................................................... 220
MARGARITA F. CASTRO v. NAPOLEON A. MONSOD.............................................................................. 220

DEAN’S CIRCLE 2017 xvii
CRISPIN DICHOSO, JR., et al. v. PATROCINIO L. MARCOS .................................................................... 221
Prescription ................................................................................................................................................................. 222
GONZALO VILLANUEVA v. SPOUSES FROILAN AND LEONILA BRANOCO .................................. 222
JAMIE ABALOS and SPOUSES FELIX SALAZAR AND CONSUELO SALAZAR v. HEIRS OF
VICENTE TORIO .................................................................................................................................................... 223
OBLIGATIONS................................................................................................................................. 224
HEIRS OF RAMON GAITE v. THE PLAZA, INC., ......................................................................................... 224
Default ........................................................................................................................................................................... 225
GENERAL MILLING CORPORATION v. SPS. LIBRADO RAMOS and REMEDIOS RAMOS......... 225
Solidary Obligations................................................................................................................................................. 226
JAPRL DEVELOPMENT CORP., et al. v. SECURITY BANK CORPORATION .................................... 226
Obligations with a Penal Clause .......................................................................................................................... 227
CONTINENTAL CEMENT CORPORATION v. ASEA BROWN BOVERI, INC., BBC BROWN
BOVERI, CORP., AND TORD B. ERIKSSON .................................................................................................. 227
Extinguishment of Obligations ............................................................................................................................ 228
DELTA DEVELOPMENT AND MANAGEMENT SERVICES, INC. v. ANGELES CATHERINE
ENRIQUEZ, et al. ................................................................................................................................................... 228
Consignation ............................................................................................................................................................... 229
SOLEDAD DALTON v. FGR REALTY AND DEVELOPMENT CORPORATION, et al. ..................... 229
Compensation............................................................................................................................................................. 230
JESUS M. MONTEMAYOR v. VICENTE D. MILLORA ................................................................................ 230
Novation: Subrogation ............................................................................................................................................ 231
REPUBLIC FLOUR MILLS CORPORATION v. FORBES FACTORS, INC. ............................................ 231
CONTRACTS .................................................................................................................................... 232
Mutuality of Contracts ............................................................................................................................................ 232
ROLANDO T. CATUNGAL, et al. v. ANGEL S. RODRIGUEZ .................................................................... 232
PHILIPPINE SAVINGS BANK v. SPOUSES ALFREDO M. CASTILLO AND ELIZABETH C.
CASTILLO, et al. ..................................................................................................................................................... 234
Cause of Contracts .................................................................................................................................................... 235
UNION BANK OF THE PHILIPPINES v. SPOUSES RODOLFO T. TIU AND VICTORIA N. TIU .. 235
Rescissible Contracts ............................................................................................................................................... 237
SAMUEL U. LEE AND PAULINE LEE AND ASIATRUST DEVELOPMENT BANK, INC. v.
BANGKOK BANK PUBLIC COMPANY, LIMITED ....................................................................................... 237
VICELET LALICON AND VICELEN LALICON v. NATIONAL HOUSING AUTHORITY ................. 238
Voidable Contracts ................................................................................................................................................... 239

DEAN’S CIRCLE 2017 xviii
CORNELIA M. HERNANDEZ v. CECILIO F. HERNANDEZ...................................................................... 239
Estoppel ........................................................................................................................................................................ 241
LANDOIL RESOURCES CORPORATION v. AL RABIAH LIGHTING COMPANY ............................ 241
Laches ............................................................................................................................................................................ 242
FELICIANO GAITERO and NELIA GAITERO v. GENEROSO ALMERIA and TERESITA ALMERIA
..................................................................................................................................................................................... 242
BAGUIO TRINITY DEVELOPERS, INC. v. THE HEIRS OF JOSE RAMOS, et al. ............................... 243
Compromise ................................................................................................................................................................ 244
SPOUSES GEORGE R. TAN and SUSAN L. TAN v. BANCO DE ORO UNIBANK, INC., ................... 244
ALEXANDER S. GAISANO v. BENJAMIN C. AKOL ..................................................................................... 245
BANGKO SENTRAL NG PILIPINAS v. ORIENT COMMERCIAL BANKING CORPORATION ...... 246
SALES ................................................................................................................................................ 247
DEVELOPMENT BANK OF THE PHILIPPINES v. BEN P. MEDRANO and PRIVATIZATION
MANAGEMENT OFFICE [PMO] ....................................................................................................................... 247
DOMINGO CARABEO v. SPOUSES NORBERTO and SUSAN DINGCO ............................................... 248
ANTONIO FRANCISCO v. CHEMICAL BULK CARRIERS, INCORPORATED .................................... 249
Double Sale .................................................................................................................................................................. 251
DOLORITA C. BEATINGO v. LILIA BU GASIS ............................................................................................. 251
LEASE ................................................................................................................................................ 252
RENE ANTONIO v. GREGORIO MANAHAN ................................................................................................ 252
HEIRS OF ANTONIO FERAREN, REPRESENTED BYANTONIO FERAREN, JR., JUSTINA
FERAREN-TABORA, LEAH FERAREN-HONASAN, ELIZABETH MARIE CLAIRE FERAREN-
ARRASTIA, MA. TERESA FERAREN-GONZALES, JOHANNA MICHELYNNE FERAREN YABUT,
SCHELMA ANTONETTE FERAREN-MENDOZA AND JUAN MIGUEL FERAREN YABUT v.
COURT OF APPEALS (FORMER 12TH DIVISION) AND CECILIA TADIAR ....................................... 253
MANILA INTERNATIONAL AIRPORT AUTHORITY v. DING VELAYO SPORTS CENTER, INC.
..................................................................................................................................................................................... 254
AGENCY ............................................................................................................................................ 255
URBAN BANK, INC. v. MAGDALENO PEÑA ................................................................................................ 255
WESTMONT INVESTMENT CORPORATION v. AMOS P. FRANCIA, JR., et al. ............................... 257
TRUST ............................................................................................................................................... 258
RICHARD JUAN v. GABRIEL YAP, SR. ........................................................................................................... 258
CREDIT TRANSACTIONS ............................................................................................................. 260
Loan ................................................................................................................................................................................ 260
LOTTO RESTAURANT CORPORATION, represented by SUAT KIM GO v. BPI FAMILY SAVINGS
BANK, INC................................................................................................................................................................ 260

DEAN’S CIRCLE 2017 xix
SPOUSES WILFREDO AND BRIGIDA PALADA v. SOLIDBANK CORPORATION, et al................ 261
Deposit .......................................................................................................................................................................... 262
DURBAN APARTMENTS CORPORATION v. PIONEER INSURANCE AND SURETY
CORPORATION ...................................................................................................................................................... 262
Guaranty ....................................................................................................................................................................... 263
STAR TWO (SPV-AMC), INC. v. HOWARD KO, MIN MIN SEE KO, JIMMY ONG, and GRACE NG
ONG ............................................................................................................................................................................ 263
Pledge ............................................................................................................................................................................ 264
UNION BANK OF THE PHILIPPINES v. ALAIN JUNIAT, et al. ............................................................. 264
Real Estate Mortgage ............................................................................................................................................... 266
SUPREME TRANSLINER, INC., MOISES C. ALVAREZ and PAULITA S. ALVAREZ v. BPI FAMILY
SAVINGS BANK, INC ............................................................................................................................................ 266
SPOUSES FERNANDO and ANGELINA EDRALIN v. PHILIPPINE VETERANS BANK................. 267
SPOUSES HERMES P. OCHOA and ARACELI D. OCHOA v. CHINA BANKING CORPORATION
..................................................................................................................................................................................... 268
RURAL BANK OF TOBOSO, INC. (now UCPB Savings Bank) v. JEAN VENIEGAS AGTOTO ..... 269
JOSEFA S. ABALOS AND THE DEVELOPMENT BANK OF THE PHILIPPINES v. SPS.
LOMANTONG DARAPA AND SINAB DIMAKUTA..................................................................................... 271
VIOLA CAHILIG and ANTONIO G. SIEL, JR. v. HON. EUSTAQUIO G. TERENCIO, et al. .............. 272
BPI FAMILY SAVINGS BANK, INC. v. MA. AVRLYN T. AVENIDO & PACIFACIO A. AVENIDO . 274
RAMONA RAMOS and THE ESTATE OF LUIS T. RAMOS v. PHILIPPINE NATIONAL BANK, et al.
..................................................................................................................................................................................... 275
Mortgagee in Good/Bad Faith ............................................................................................................................. 276
ARMANDO V. ALANO [Deceased], Substituted by Elena Alano-Torres, v. PLANTERS
DEVELOPMENT BANK, as Successor-in-Interest of MAUNLAD SAVINGS and LOAN
ASSOCIATION, INC. .............................................................................................................................................. 276
SUCCESSION .................................................................................................................................... 278
Probate of a Will ........................................................................................................................................................ 278
IN RE: IN THE MATTER OF THE PETITION TO APPROVE THE WILL OF RUPERTA
PALAGANAS WITH PRAYER FOR THE APPOINTMENT OF SPECIAL ADMINISTRATOR;
MANUEL MIGUEL PALAGANAS, et al. v. ERNESTO PALAGANAS ..................................................... 278
LAND TITLES AND DEEDS .......................................................................................................... 279
HEIRS OF MARGARITO PABAUS v. HEIRS OF AMANDA YUTIAMCO .............................................. 279
Certificate of Title ..................................................................................................................................................... 281
ROSALIA N. ESPINO v. SPOUSES SHARON SAMPANI BULUT and CELEBI BULUT ................... 281
MARIA TORBELA v. SPOUSES ANDRES T. ROSARIO and LENA DUQUE-ROSARIO and BANCO
FILIPINO SAVINGS AND MORTGAGE BANK ............................................................................................. 282

DEAN’S CIRCLE 2017 xx
Innocent Purchaser for Value .............................................................................................................................. 284
AURORA L. TECSON, et al. v. MINERVA, MARIA, et al. ALL SURNAMED FAUSTO AND ISABEL
VDA. DE FAUSTO .................................................................................................................................................. 284
THE HEIRS OF NICOLAS S. CABIGAS v. MELBA L. LIMBACO, et al................................................... 285
PHILIPPINE NATIONAL BANK v. CIRIACO JUMAMOY and HEIRS OF ANTONIO GO PACE,
represented by ROSALIA PACE ...................................................................................................................... 287
Direct and Collateral Attack on Land Titles ................................................................................................... 288
ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA v. EDUARDO SORIANO,
JR., et al. / BENJAMIN GUINTO, JR., v. ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO,
PAMPANGA ............................................................................................................................................................. 288
Original Registration ............................................................................................................................................... 289
REPUBLIC OF THE PHILIPPINES v. CARLOS VEGA ................................................................................ 289
VICENTE YU CHANG AND SOLEDAD YU CHANG v. REPUBLIC OF THE PHILIPPINES ............ 290
REPUBLIC OF THE PHILIPPINES v. TEODORO P. RIZALVO, JR. ........................................................ 291
UNION LEAF TOBACCO CORPORATION v. REPUBLIC OF THE PHILIPPINES............................. 293
NATIVIDAD STA. ANA VICTORIA v. REPUBLIC OF THE PHILIPPINES .......................................... 294
RAMON ARANDA v. REPUBLIC OF THE PHILIPPINES ......................................................................... 295
DCD CONSTRUCTION INC. v. REPUBLIC OF THE PHILIPPINES ....................................................... 297
PACIFICO M. VALIAO v. REPUBLIC OF THE PHILIPPINES, et al. ...................................................... 298
Jurisdiction for Land Registration...................................................................................................................... 299
CITY OF DUMAGUETE v. PHILIPPINE PORTS AUTHORITY................................................................ 299
Reconveyance ............................................................................................................................................................. 301
MODESTO LEOVERAS v. CASIMERO VALDEZ .......................................................................................... 301
LORETO LUGA (DECEASED) SUBSTITUTED BY CELERINA LUGA DECEASED (WIFE) AND
CHILDREN v. SPS. ELENA AND ROGELIO ARCIAGA .............................................................................. 302
ESTRELLA TIONGCO YARED (Deceased) substituted by CARMEN M. TIONGCO a.k.a.
CARMEN MATILDE B. TIONGCO v. JOSE B. TIONGCO and ANTONIO G. DORONILA, JR. ........ 303
Reconstitution ............................................................................................................................................................ 304
REPUBLIC OF THE PHILIPPINES v. CANDIDO, DEMETILA, JESUS, ANGELITO, and TERESITA,
all surnamed VERGEL DE DIOS ...................................................................................................................... 304
BIENVENIDO CASTILLO v. REPUBLIC OF THE PHILIPPINES ............................................................ 305
TORTS AND DAMAGES ................................................................................................................ 307
Negligence .................................................................................................................................................................... 307
ALBERT TISON and CLAUDIO L. JABON v. SPS. GREGORIO POMASIN, et al................................ 307
Principle of Vicarious Liability ............................................................................................................................ 308
RCJ BUS LINES, INCORPORATED v. STANDARD INSURANCE COMPANY, INCORPORATED 308

DEAN’S CIRCLE 2017 xxi
Proximate Cause Doctrine ..................................................................................................................................... 310
SPOUSES LUIGI M. GUANIO and ANNA HERNANDEZ-GUANIO v. MAKATI SHANGRI-LA
HOTEL and RESORT, INC., also doing business under the name of SHANGRI-LA HOTEL
MANILA .................................................................................................................................................................... 310
VALLACAR TRANSIT, INCORPORATION v. JOCELYN G. CATUBIG................................................... 311
Medical Negligence................................................................................................................................................... 311
DR. RUBI LI v. SPOUSES REYNALDO and LINA SOLIMAN, as parents/heirs of deceased
Angelica Soliman, ................................................................................................................................................. 312
Diligence for Banking Institutions ..................................................................................................................... 313
PHILIPPINE NATIONAL BANK v. F.F. CRUZ AND CO., INC. ................................................................. 313
DAMAGES ..................................................................................................................................................................... 315
Actual Damages ......................................................................................................................................................... 315
LETICIA TAN, et al. v. OMC CARRIERS, INC. and BONIFACIO ARAMBALA................................... 315
OCEANEERING CONTRACTORS (PHILS.), INC. v. NESTOR N. BARRETTO, doing business as
N.N.B. LIGHTERAGE ............................................................................................................................................ 316
PEOPLE OF THE PHILIPPINES v. ROBERTO LOPEZ y CABAL ........................................................... 318
BENJAMIN BELTRAN, JR., et al. v. COURT OF APPEALS AND THE PEOPLE OF THE
PHILIPPINES .......................................................................................................................................................... 319
Attorney’s Fees .......................................................................................................................................................... 320
ALCATEL PHILIPPINES, INC. v. I.M. BONGAR &CO., INC. AND STRONGHOLD INSURANCE, CO.,
INC. ............................................................................................................................................................................. 320
DEVELOPMENT BANK OF THE PHILIPPINES v. TRAVERSE DEVELOPMENT CORPORATION
AND CENTRAL SURETY AND INSURANCE COMPANY ......................................................................... 321
Moral Damages .......................................................................................................................................................... 322
PEOPLE OF THE PHILIPPINES v. HEMIANO DE JESUS and RODELO MORALES ....................... 323
IMMACULATE CONCEPTION ACADEMY and the late DR. PAULO C. CAMPOS substituted by
his heirs, DR. JOSE PAULO E. CAMPOS ATTY. PAULO E. CAMPOS, JR. and DR. ENRIQUE E.
CAMPOS v. AMA COMPUTER COLLEGE INCORPORATED................................................................... 323
RODOLFO N. REGALA v. FEDERICO P. CARIN .......................................................................................... 324
TAXATION LAW ........................................................................................................ 327
INCOME TAXATION ...................................................................................................................... 327
COMMISSIONER OF INTERNAL REVENUE v. FILINVEST DEVELOPMENT CORPORATION . 327
Refund or Tax Credit of Income Tax ................................................................................................................. 328
BELLE CORPORATION v. COMMISSIONER OF INTERNAL REVENUE ............................................ 328
BELLE CORPORATION v. COMMISSIONER OF INTERNAL REVENUE ............................................ 330
MERCURY DRUG CORPORATION v. COMMISSIONER OF INTERNAL REVENUE ....................... 331

DEAN’S CIRCLE 2017 xxii
VALUE-ADDED TAX ...................................................................................................................... 332
RENATO V. DIAZ and AURORA MA. F. TIMBOL v. THE SECRETARY OF FINANCE AND THE
COMMISSION OF INTERNAL REVENUE ..................................................................................................... 332
LVM CONSTRUCTION CORPORATION, REPRESENTED BY ANDRES CHUA LAO v. F.T.
SANCHEZ/SOCOR/KIMWA (JOINT VENTURE), F.T. SANCHEZ CONSTRUCTION
CORPORATION, SOCOR CONSTRUCTION CORPORATION AND KIMWA CONSTRUCTION AND
DEVELOPMENT CORPORATION ALL REPRESENTED BY FORTUNATO O. SANCHEZ, JR. ..... 333
Refund or Tax Credit of Value-Added Tax ...................................................................................................... 335
SILICON PHILIPPINES, INC. v. COMMISSIONER OF INTERNAL REVENUE .................................. 335
MICROSOFT PHILIPPINES, INC v. COMMISSIONER OF INTERNAL REVENUE ........................... 336
SOUTHERN PHILIPPINES POWER CORPORATION v. COMMISSIONER OF INTERNAL
REVENUE ................................................................................................................................................................. 337
EXCISE TAXES ................................................................................................................................ 338
COMMISSIONER OF INTERNAL REVENUE v. SAN MIGUEL CORPORATION ............................... 338
DOCUMENTARY TAXES ............................................................................................................... 339
COMMISSIONER OF INTERNAL REVENUE v. MANILA BANKERS’ LIFE INSURANCE
CORPORATION ...................................................................................................................................................... 339
PRUDENTIAL BANK v. COMMISSIONER OF INTERNAL REVENUE................................................. 340
REAL PROPERTY TAXATION .................................................................................................... 342
CITY OF PASIG, REPRESENTED BY THE CITY TREASURER and THE CITY ASSESSOR v.
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE PRESIDENTIAL COMMISSION ON
GOOD GOVERNMENT ......................................................................................................................................... 342
JUDICIAL REMEDIES .................................................................................................................... 343
CENTRAL LUZON DRUG CORPORATION v. COMMISSIONER OF INTERNAL REVENUE ........ 343
REVISED RULES OF COURT OF TAX APPEALS ..................................................................... 344
PHILIPPINE NATIONAL BANK v. COMMISSIONER OF INTERNAL REVENUE ............................ 344
MERCANTILE LAW................................................................................................... 347
NEGOTIABLE INSTRUMENTS LAW ......................................................................................... 347
Consideration ............................................................................................................................................................. 347
ENGR. JOSE E. CAYANAN v. NORTH STAR INTERNATIONAL TRAVEL, INC. ............................... 347
INSURANCE LAW ........................................................................................................................... 348
Right of Subrogation ................................................................................................................................................ 348
ASIAN TERMINALS, INC. v. MALAYAN INSURANCE, CO., INC ........................................................... 348
TRANSPORTATION LAW ............................................................................................................ 348
Registered Owner Rule ........................................................................................................................................... 349

DEAN’S CIRCLE 2017 xxiii
FEB LEASING AND FINANCE CORPORATION (now BPI LEASING CORPORATION) v. SPOUSES
SERGIO P. BAYLON and MARITESS VILLENA-BAYLON, BG HAULER, INC., and MANUEL Y.
ESTILLOSO .............................................................................................................................................................. 349
MARITIME COMMERCE ............................................................................................................... 349
Doctrine of Limited Liability ................................................................................................................................ 349
AGUSTIN P. DELA TORRE v. THE HONORABLE COURT OF APPEALS, et al. ............................... 349
The Carriage of Goods by Sea Act ....................................................................................................................... 350
NEW WORLD INTERNATIONAL DEVELOPMENT (PHILS.), INC. v. NYK-FILJAPAN SHIPPING
CORP., et al. / NEW WORLD INTERNATIONAL DEVELOPMENT (PHILS.), INC. v. SEABOARD-
EASTERN INSURANCE CO., INC., .................................................................................................................... 351
CORPORATION LAW .................................................................................................................... 352
Intra-Corporate Controversies ............................................................................................................................ 352
HEIRS OF SANTIAGO C. DIVINAGRACIA v. HON. J. CEDRICK O. RUIZ ............................................ 352
RENATO REAL v. SANGU PHILIPPINES, INC. and/ or KIICHI ABE .................................................. 353
STRATEGIC ALLIANCE DEVELOPMENT CORPORATION v. STAR INFRASTRUCTURE
DEVELOPMENT CORPORATION, et al. ........................................................................................................ 355
MARY JOY ANNE GUSTILO and BONIFACIO M. PEA v. JOSE VICENTE GUSTILO III and
TERESITA YOUNG also known as TITA SY YOUNG, ............................................................................... 356
MARC II MARKETING, INC. and LUCILA V. JOSON v. ALFREDO M. JOSON ................................... 357
Doctrine of Separate Juridical Personality ..................................................................................................... 358
HARPOON MARINE SERVICES, INC., et al. v. FERNAN H. FRANCISCO ........................................... 358
Corporate Powers ..................................................................................................................................................... 360
MAJORITY STOCKHOLDERS OF RUBY INDUSTRIAL CORPORATION v. MIGUEL LIM ............ 360
INTELLECTUAL PROPERTY LAW............................................................................................. 362
Trademark ................................................................................................................................................................... 362
FREDCO MANUFACTURING CORPORATION v. PRESIDENT AND FELLOWS OF HARVARD
COLLEGE (HARVARD UNIVERSITY) ............................................................................................................ 362
GEMMA ONG aka MARIA TERESA GEMMA CATACUTAN v. PEOPLE OF THE PHILIPPINES 364
SECURITIES AND REGULATION CODE ................................................................................... 364
PHILIPPINE VETERANS BANK v. JUSTINA CALLANGAN, in her capacity as Director of the
Corporation Finance Department of the Securities and Exchange Commission and/or the
SECURITIES AND EXCHANGE COMMISSION ............................................................................................ 364
CORPORATE REHABILITATION ............................................................................................... 366
LEONARDO S. UMALE, [deceased] represented by CLARISSA VICTORIA, JOHN LEO, GEORGE
LEONARD, KRISTINE, MARGUERITA ISABEL, and MICHELLE ANGELIQUE, ALL SURNAMED
UMALE v. ASB Realty Corp. .............................................................................................................................. 366

DEAN’S CIRCLE 2017 xxiv
ASIATRUST DEVELOPMENT BANK v. FIRST AIKKA DEVELOPMENT, INC. and UNIVAC
DEVELOPMENT, INC. .......................................................................................................................................... 368
BPI FAMILY SAVINGS BANK, INC v. PRYCE GASES, INC. INTERNATIONAL FINANCE
CORPORATION, and NEDERLANDSE FINANCIERINGS-MAATSCHAPPIJVOOR
ONTWIKKELINGSLANDEN N.V. ..................................................................................................................... 369
SIOCHI FISHERY ENTERPRISES, INC., JUN-JUN FISHING CORPORATION, DEDE FISHING
CORPORATION, BLUE CREST AQUA-FARMS, INC., and ILOILO PROPERTY VENTURES, INC. v.
BANK OF THE PHILIPPINE ISLANDS ........................................................................................................... 370
CONSUMER ACT ............................................................................................................................. 371
AOWA ELECTRONIC PHILIPPINES, INC v. DEPARTMENT OF TRADE AND INDUSTRY,
NATIONAL CAPITAL REGION ......................................................................................................................... 371
BANK SECRECY LAW .................................................................................................................... 372
RICARDO B. BANGAYAN v. RIZAL COMMERCIAL BANKING CORPORATION and PHILIP
SARIA......................................................................................................................................................................... 372
GOVERNMENT SERVICE INSURANCE SYSTEM v. THE HONORABLE 15TH DIVISION OF THE
COURT OF APPEALS and INDUSTRIAL BANK OF KOREA ET. AL..................................................... 374
CRIMINAL LAW ......................................................................................................... 375
CRIMINAL LAW I ........................................................................................................................... 375
Proximate Cause ........................................................................................................................................................ 375
PEOPLE OF THE PHILIPPINES v. ORLITO VILLACORTA ..................................................................... 375
JUSTIFYING CIRCUMSTANCES ............................................................................................................................ 376
Self-Defense ................................................................................................................................................................. 376
PEOPLE OF THE PHILIPPINES v. ROGELIO DOLORIDO y ESTRADA .............................................. 376
PEOPLE OF THE PHILIPPINES v. ANTONIO SABELLA y BRAGAIS .................................................. 377
PEOPLE OF THE PHILIPPINES v. ANGELITO ESQUIBEL y JESUS ..................................................... 378
PEOPLE OF THE PHILIPPINES v. BINGKY CAMPOS and DANNY BOY ACABO ........................... 379
PEOPLE OF THE PHILIPPINES v. DAVID MANINGDING ...................................................................... 380
PEOPLE OF THE PHILIPPINES v. EDGAR CONCILLADO ...................................................................... 381
PEOPLE OF THE PHILIPPINES v. LINO L. DUAVIS.................................................................................. 382
MITIGATING CIRCUMSTANCES .......................................................................................................................... 383
Incomplete Self-Defense ........................................................................................................................................ 383
PEOPLE OF THE PHILIPPINES v. ALLAN GABRINO............................................................................... 383
Lack of Intent to Commit So Grave a Wrong.................................................................................................. 384
PEOPLE OF THE PHILIPPINES v. NOEL T. SALES ................................................................................... 384
Voluntary Surrender................................................................................................................................................ 386
PEOPLE OF THE PHILIPPINES v. REX NIMUAN y CACHO ................................................................... 386

DEAN’S CIRCLE 2017 xxv
PEOPLE OF THE PHILIPPINES v. JAY MANDY MAGLIAN y REYES .................................................. 387
AGGRAVATING CIRCUMSTANCES ..................................................................................................................... 388
Dwelling and Illegal Possession of Firearm ................................................................................................... 388
PEOPLE OF THE PHILIPPINES v. ARNOLD T. AGCANAS ..................................................................... 388
Taking Advantage of Superior Strength .......................................................................................................... 389
PEOPLE OF THE PHILIPPINES v. ALEX PALING, ERNIE VILBAR, and ROY VILBAR ................ 389
PEOPLE OF THE PHILIPPINES v. MARIANITO TERIAPIL Y QUINAWAYAN ................................ 390
Conspiracy ................................................................................................................................................................... 391
PEOPLE OF THE PHILIPPINES v. BARANGAY CAPTAIN TONY TOMAS, SR., BENEDICTO
DOCTOR, and NESTOR GATCHALIAN .......................................................................................................... 392
ANTONIO Y. DE JESUS, SR., et. al. v. SANDIGANBAYAN-FOURTH DIVISION AND PEOPLE OF
THE PHILIPPINES ................................................................................................................................................ 393
PEOPLE OF THE PHILIPPINES v. EFREN PATELAN LAMBERTE @ KALBO and MARCELINO
RUIZ NIMUAN @ CELINE, MARCELINO RUIZ NIMUAN ....................................................................... 395
PEOPLE OF THE PHILIPPINES v. RESTITUTO CARANDANG, HENRY MILAN AND JACKMAN
CHUA ......................................................................................................................................................................... 396
PEOPLE OF THE PHILIPPINES v. FLORENCIO AGACER, et al. ........................................................... 397
PEOPLE OF THE PHILIPPINES v. NELIDA DEQUINA Y DIMAPANAN, JOSELITO JUNDOC Y
JAPITANA & NORA JINGABO Y CRUZ ........................................................................................................... 398
PEOPLE OF THE PHILIPPINES v. JULIET OLACO y POLER ................................................................. 399
CRIMINAL LAW II .......................................................................................................................... 399
CRIMES AGAINST PUBLIC INTEREST ..................................................................................... 399
Illegal Possession and Use of False Treasury or Bank Notes and Other Instruments of Credit399
MARK CLEMENTE Y MARTINEZ @ EMANNUEL DINO v. PEOPLE OF THE PHILIPPINES ..... 399
Falsification by Public Officer, Employee; or Notary or Ecclesiastical Minister ............................. 400
ROSALIO S. GALEOS v. PEOPLE OF THE PHILIPPINES ......................................................................... 400
ZAFIRO L. RESPICIO v. PEOPLE OF THE PHILIPPINES......................................................................... 402
Falsification by Private Individuals and Use of Falsified Documents.................................................. 404
CRIMES COMMITTED BY PUBLIC OFFICERS ........................................................................ 405
Malversation of Public Funds............................................................................................................................... 405
JOSE T. TUBOLA, JR. v. SANDIGANBAYAN and PEOPLE ....................................................................... 405
ZACARIA A. CANDAO, ABAS A. CANDAO, AND ISRAEL B. HARON v. PEOPLE OF THE
PHILIPPINES AND SANDIGANBAYAN ......................................................................................................... 406
GUILLERMO E. CUA v. PEOPLE OF THE PHILIPPINES.......................................................................... 407
CRIMES AGAINST PERSONS ....................................................................................................... 408

DEAN’S CIRCLE 2017 xxvi
Murder........................................................................................................................................................................... 409
PEOPLE OF THE PHILIPPINES v. ALVIN DEL ROSARIO ....................................................................... 409
PEOPLE OF THE PHILIPPINES v. CHARLIE ABAÑO Y CAÑARES...................................................... 409
PEOPLE OF THE PHILIPPINES v. ROMEO ANCHES ............................................................................... 410
PEOPLE OF THE PHILIPPINES v. ROSENDO REBUCAN y LAMSIN .................................................. 411
PEOPLE OF THE PHILIPPINES v. LARRY TORRES, SR. ......................................................................... 412
PEOPLE OF THE PHILIPPINES v. CLEOFE BAROQUILLO .................................................................... 413
PEOPLE OF THE PHILIPPINES v. ANGELINO YANSON ........................................................................ 414
PEOPLE OF THE PHILIPPINES v. MICHAEL BOKINGCO alias MICHAEL BOKINGCO and
REYNANTE COL .................................................................................................................................................... 415
Homicide....................................................................................................................................................................... 416
PEOPLE OF THE PHILIPPINES v. RODEL LANUZA................................................................................. 416
Rape ................................................................................................................................................................................ 417
PEOPLE OF THE PHILIPPINES v. JERWIN QUINTAL y BEO, VICENTE BONGAT y TARIMAN,
FELIPE QUINTAL y ABARQUEZ and LARRY PANTI y JIMENEZ ........................................................ 417
THE PEOPLE OF THE PHILIPPINES v. JOSE GALVEZ y BLANCA, ..................................................... 419
PEOPLE OF THE PHILIPPINES v. ERNESTO FRAGANTE y AYUDA.................................................. 420
PEOPLE OF THE PHILIPPINES v. EVILIO MILAGROSA ......................................................................... 421
PEOPLE OF THE PHILIPPINES v. PORFERIO MASAGCA, JR. Y PADILLA ....................................... 422
PEOPLE OF THE PHILIPPINES v. JENNY TUMAMBING y TAMAYO ................................................ 423
PEOPLE OF THE PHILIPPINES v. FLORANTE RELANES ...................................................................... 424
PEOPLE OF THE PHILIPPINES v. VICENTE PUBLICO ........................................................................... 425
PEOPLE OF THE PHILIPPINES v. ERNESTO MERCADO ....................................................................... 427
PEOPLE OF THE PHILIPPINES v. ROSAURO ASETRE Y DURAN ....................................................... 428
PEOPLE OF THE PHILIPPINES v. ITO PINIC ............................................................................................. 429
PEOPLE OF THE PHILIPPINES v. CONRADO LAOG y RAMIN ............................................................ 430
PEOPLE OF THE PHILIPPINES v. ANIECTO BULAGAO ......................................................................... 431
PEOPLE OF THE PHILIPPINES v. BERNABE PANGILINAN y CRISOSTOMO ................................ 433
PEOPLE OF THE PHILIPPINES v. JOJO DELA PAZ y TABOCAN ......................................................... 434
PEOPLE OF THE PHILIPPINES v. HENRY ARPON y JUNTILLA.......................................................... 434
PEOPLE OF THE PHILIPPINES v. LUISITO LALICAN y ARCE ............................................................. 436
PEOPLE OF THE PHILIPPINES v. JIMMY ALVERIO ................................................................................ 437
PEOPLE OF THE PHILIPPINES v. HERMIE M. JACINTO........................................................................ 438
PEOPLE OF THE PHILIPPINES v. CARLO DUMADAG Y ROMIO ........................................................ 439
Qualified Rape ............................................................................................................................................................ 440

DEAN’S CIRCLE 2017 xxvii
PEOPLE OF THE PHILIPPINES v. NILO ROCABO .................................................................................... 440
PEOPLE OF THE PHILIPPINES v. EDGARDO OGARTE y OCOB ......................................................... 441
PEOPLE OF THE PHILIPPINES v. BENJAMIN PADILLA y UNTALAN .............................................. 442
PEOPLE OF THE PHILIPPINES v. LUCRESIO ESPINA ............................................................................ 443
PEOPLE OF THE PHILIPPINES v. MARCIANO DOLLANO, JR. ............................................................. 444
PEOPLE OF THE PHILIPPINES v. RODEL SINGSON ............................................................................... 446
PEOPLE OF THE PHILIPPINES v. MARCELO PEREZ .............................................................................. 447
PEOPLE OF THE PHILIPPINES v. JOSELITO ORJE y BORCE ............................................................... 448
PEOPLE OF THE PHILIPPINES v. ARNEL MANJARES ........................................................................... 449
PEOPLE OF THE PHILIPPINES v. SIXTO PADUA y FELOMINA.......................................................... 451
PEOPLE OF THE PHILIPPINES v. ANTONIO OTOS alias ANTONIO OMOS.................................... 452
PEOPLE OF THE PHILIPPINES v. RONALDO SALUDO .......................................................................... 452
PEOPLE OF THE PHILIPPINES v. JONIE DOMINGUEZ .......................................................................... 454
PEOPLE OF THE PHILIPPINES v. TERENCIO FUNESTO....................................................................... 455
Sweetheart Theory or Sweetheart Defense ................................................................................................... 456
PEOPLE OF THE PHILIPPINES v. REYNALDO OLESCO ........................................................................ 456
PEOPLE OF THE PHILIPPINES v. FELIPE MIRANDILLA, JR. ............................................................... 457
CRIMES AGAINST PERSONAL LIBERTY AND SECURITY .................................................. 458
Kidnapping .................................................................................................................................................................. 458
PEOPLE OF THE PHILIPPINES v. AIDA MARQUEZ................................................................................. 458
PEOPLE OF THE PHILIPPINES v. JOEL BALUYA y NOTARTE ............................................................ 459
PEOPLE OF THE PHILIPPINES v. JERRY JACALNE GUTIERREZ ....................................................... 460
Grave Threats ............................................................................................................................................................. 461
SANTIAGO PAERA v. PEOPLE OF THE PHILIPPINES ............................................................................ 461
CRIMES AGAINST PROPERTY ................................................................................................... 462
Robbery with HOMICIDE ....................................................................................................................................... 462
PEOPLE OF THE PHILIPPINES v. NGANO SUGAN, NGA BEN LATAM, FRANCING, GAGA
LATAM, SALIGO KUYAN and KAMISON AKOY ......................................................................................... 462
Qualified Theft............................................................................................................................................................ 463
PEOPLE OF THE PHILIPPINES v. BERNARD MIRTO ............................................................................. 463
Estafa.............................................................................................................................................................................. 464
LYZAH SY FRANCO v. PEOPLE OF THE PHILIPPINES ........................................................................... 464
PEOPLE OF THE PHILIPPINES v. VIRGINIA BABY MONTANER ....................................................... 466
Attempted Estafa....................................................................................................................................................... 466

DEAN’S CIRCLE 2017 xxviii
ELVIRA LATEO Y ELEAZAR, FRANCISCO ELCA Y ARCAS, AND BARTOLOME BALDEMOR Y
MADRIGAL v. PEOPLE OF THE PHILIPPINES ........................................................................................... 466
Malicious Mischief .................................................................................................................................................... 468
ROBERT TAGUINOD v. PEOPLE OF THE PHILIPPINES ........................................................................ 468
ILLEGAL MARRIAGES .................................................................................................................. 469
Bigamy ........................................................................................................................................................................... 469
CENON TEVES v. PEOPLE OF THE PHILIPPINES .................................................................................... 469
ATILANO O. NOLLORA, JR. v. PEOPLE OF THE PHILIPPINES ............................................................ 469
CRIMES AGAINST HONOR .......................................................................................................... 471
Libel ................................................................................................................................................................................ 471
DIONISIO LOPEZ y ABERASTURI v. PEOPLE OF THE PHILIPPINES ............................................... 471
ISAGANI M. YAMBOT, LETTY JIMENEZ-MAGSANOC, JOSE MA. D. NOLASCO, ARTEMIO T.
ENGRACIA, JR. and VOLT CONTRERAS v. Hon. ARTEMIO TUQUERO in his capacity as
Secretary of Justice, and ESCOLASTICO U. CRUZ, JR. ............................................................................. 472
SPECIAL PENAL LAWS ................................................................................................................. 473
R.A. No. 4103, Indeterminate Sentence Law.................................................................................................. 473
ROSANA ASIATICO y STA. MARIA v. PEOPLE OF THE PHILIPPINES ............................................. 473
P.D. No. 968, Probation Law ................................................................................................................................. 475
ARNEL COLINARES v. PEOPLE OF THE PHILIPPINES .......................................................................... 475
R.A. No. 7610, Special Protection of Children Against Child Abuse, Exploitation and
Discrimination............................................................................................................................................................ 476
JOJIT GARINGARAO v. PEOPLE OF THE PHILIPPINES.......................................................................... 476
R.A. No. 3019, Anti-Graft and Corrupt Practices Act .................................................................................. 477
VAN D. LUSPO v. PEOPLE OF THE PHILIPPINES .................................................................................... 477
VIRGINIA M. GUADINES v. SANDIGANBAYAN AND PEOPLE OF THE PHILIPPINES ............... 479
ELFREN L. ALVAREZ v. PEOPLE OF THE PHILIPPINES ....................................................................... 480
RUPERTO A. AMBIL, JR. v. SANDIGANBAYAN AND PEOPLE OF THE PHILIPPINES ................ 481
JOSE CATACUTAN v. PEOPLE OF THE PHILIPPINES............................................................................. 483
B.P. Blg. 22, Bouncing Checks Law ..................................................................................................................... 484
JAIME ALFEREZ v. PEOPLE OF THE PHILIPPINES AND PINGPING CO ......................................... 484
R.A. No. 8042, Illegal Recruitment ..................................................................................................................... 485
PEOPLE OF THE PHILIPPINES v. ROSARIO ROSE OCHOA .................................................................. 485
Syndicated Illegal Recruitment ........................................................................................................................... 486
PEOPLE OF THE PHILIPPINES v. HADJA JARMA LALLI y PURIH, et al. ......................................... 486
R.A. No. 9165, Comprehensive Dangerous Drugs Act of 2002 ............................................................... 488

DEAN’S CIRCLE 2017 xxix
PEOPLE OF THE PHILIPPINES v. CARLO MAGNO AURE y ARNALDO and MELCHOR
AUSTRIACO y AGUILA ........................................................................................................................................ 488
PEOPLE OF THE PHILIPPINES v. LORIE VILLAHERMOSA y LECO .................................................. 489
PEOPLE OF THE PHILIPPINES v. MANUEL CRUZ Y CRUZ .................................................................. 490
PEOPLE OF THE PHILIPPINES v. ARNOLD CASTRO Y YANGA .......................................................... 491
RUEL AMPATUAN ALIAS RULE v. PEOPLE OF THE PHILIPPINES .................................................. 492
PEOPLE OF THE PHILIPPINES v. CHITO GRATIL y GUELAS .............................................................. 493
PEOPLE OF THE PHILIPPINES v. JOEL GASPAR y WILSON ................................................................ 494
MICHAEL SAN JUAN y CRUZ v. PEOPLE OF THE PHILIPPINES ........................................................ 495
PEOPLE OF THE PHILIPPINES v. ARNEL ZAPATA y CANILAO ......................................................... 497
RAUL DAVID v. PEOPLE OF THE PHILIPPINES ....................................................................................... 497
PEOPLE OF THE PHILIPPINES v. ASMAD BARA y ASMAD ................................................................. 499
PEOPLE OF THE PHILIPPINES v. GREGG C. BUENAVENTURA ......................................................... 500
PEOPLE OF THE PHILIPPINES v. MANUEL PALOMA Y ESPINOSA.................................................. 501
PEOPLE OF THE PHILIPPINES v. BERTHA PRESAS y TOLENTINO................................................. 502
PEOPLE OF THE PHILIPPINES v. RONALDO MORALES y FLORES alias Ronnie, and RODOLFO
FLORES y MANGYAN alias Roding. ............................................................................................................... 503
Instigation .................................................................................................................................................................... 504
PEOPLE OF THE PHILIPPINES v. NENITA LEGASPI y LUCAS ............................................................ 504
PEOPLE OF THE PHILIPPINES v. ROMEO DANSICO Y MONAY A.K.A. “LAMYAK” AND
AUGUSTO CUADRA Y ENRIQUEZ................................................................................................................... 506
R.A. No. 6539, Anti-Carnapping Law ................................................................................................................. 507
PEOPLE OF THE PHILIPPINES v. RENATO LAGAT y GAWAN a.k.a. RENAT GAWAN and JAMES
PALALAY y VILLAROSA ..................................................................................................................................... 507
R.A. No. 8484, Access Devices Regulation Act ............................................................................................... 508
MARK SOLDEDAD Y CRISTOBAL v. PEOPLE OF THE PHILIPPINES ............................................... 508
P.D. 969, Anti-Pornography Act .......................................................................................................................... 510
FREDRIK FELIX P. NOGALES, GIANCARLO P. NOGALES, ROGELIO P. NOGALES, MELINDA P.
NOGALES, PRISCILA B. CABRERA, PHIL-PACIFIC OUTSOURCING SERVICES CORPORATION
and 3 X 8 INTERNET v. PEOPLE OF THE PHILIPPINES and PRESIDING JUDGE TITA BUGHAO
ALISUAG ................................................................................................................................................................... 510
P.D. 705, Possession of Timber ........................................................................................................................... 511
CRISOSTOMO VILLARIN v. PEOPLE OF THE PHILIPPINES ................................................................ 511
Philippine Fisheries Code ...................................................................................................................................... 511
SEA LION FISHING CORPORATION v. PEOPLE OF THE PHILIPPINES ........................................... 512
REMEDIAL LAW ........................................................................................................ 514

DEAN’S CIRCLE 2017 xxx
CRIMINAL PROCEDURE .............................................................................................................. 514
Jurisdiction .................................................................................................................................................................. 514
ANGELITO MAGNO v. PEOPLE OF THE PHILIPPINES, et al. ............................................................... 514
Institution of Criminal Actions ............................................................................................................................ 515
BUREAU OF CUSTOMS v. PETER SHERMAN, et. al. ................................................................................ 515
Real Party in Interest............................................................................................................................................... 516
CITY GOVERNMENT OF TUGUEGARAO, represented by ROBERT P. GUZMAN v. RANDOLPH
S. TING ...................................................................................................................................................................... 516
Probable Cause .......................................................................................................................................................... 517
CLAY & FEATHER INTERNATIONAL, INC., et al. v. ALEXANDER T. LICHAYTOO and CLIFFORD
T. LICHAYTOO ....................................................................................................................................................... 517
GEORGE MILLER v. SECRETARY HERNANDO B. PEREZ...................................................................... 518
JOSEPH ANTHONY M. ALEJANDRO, et. al v. ATTY. JOSE A. BERNAS, et al. .................................. 519
Warrantless Arrest ................................................................................................................................................... 521
PEOPLE OF THE PHILIPPINES v. NG YIK BUn, et al. .............................................................................. 521
PEOPLE OF THE PHILIPPINES v. ERNESTO UYBOCO y RAMOS ....................................................... 522
Sufficiency of Information ..................................................................................................................................... 523
PEOPLE OF THE PHILIPPINES v. ROBERT P. BALAO, et al. ................................................................ 523
PEOPLE OF THE PHILIPPINES v. NOEL DION .......................................................................................... 524
Prescription ................................................................................................................................................................. 525
PRESIDENTIAL AD HOC FACT-FINDING COMMITTEE ON BEHEST LOANS v. OMBUDSMAN
ANIANO A. DESIERTO, et al.............................................................................................................................. 525
Res Judicata ................................................................................................................................................................. 526
HON. WALDO Q. FLORES, et al. v. ATTY. ANTONIO F. MONTEMAYOR .......................................... 526
Arraignment ................................................................................................................................................................ 527
SPOUSES ALEXANDER TRINIDAD and CECILIA TRINIDAD v. VICTOR ANG ............................... 527
Demurrer to Evidence............................................................................................................................................. 528
HON. JUDGE JESUS B. MUPAS, Presiding Judge, Regional Trial Court, Branch 112 and
CARMELITA F. ZAFRA, Chief Administrative Officer, DSWD v. PEOPLE OF THE PHILIPPINES
..................................................................................................................................................................................... 528
GOODLAND COMPANY, INC. v. ABRAHAM CO andCHRISTINE CHAN ........................................... 529
Motion for Reconsideration .................................................................................................................................. 530
ANTONIO LEJANO v. PEOPLE OF THE PHILIPPINES ............................................................................ 530
Newly Discovered Evidence ................................................................................................................................. 531
LENIDO LUMANOG et al. v. PEOPLE OF THE PHILIPPINES................................................................ 531

DEAN’S CIRCLE 2017 xxxi
Appeal ............................................................................................................................................................................ 532
EDWARD GARRICK VILLENA and PERCIVAL DOROJA v. PEOPLE OF THE PHILIPPINES, et al.
..................................................................................................................................................................................... 532
JUDITH YU v. HON. ROSA SAMSON-TATAD and THE PEOPLE OF THE PHILIPPINES............. 533
JOEL GALZOTE y SORIAGA v. JONATHAN BRIONES and PEOPLE OF THE PHILIPPINES ...... 534
ANSELMO DE LEON CUYO v. PEOPLE OF THE PHILIPPINES ............................................................ 535
CIVIL PROCEDURE ........................................................................................................................ 536
Jurisdiction .................................................................................................................................................................. 536
M.A. JIMENEZ ENTERPRISES, INC., represented by CESAR CALIMLIM and LAILA BALOIS v.
THE HONORABLE OMBUDSMAN, JESUS P. CAMMAYO, et al. ............................................................ 537
PEOPLE OF THE PHILIPPINES v. LUIS J. MORALES ............................................................................... 538
HOME GUARANTY CORPORATION v. R-II BUILDERS INC. AND NATIONAL HOUSING
AUTHORITY ............................................................................................................................................................ 539
LAND BANK OF THE PHILIPPINES v. HEIRS OF SEVERINO LISTANA ........................................... 540
SPS EULOGIA & RAMON MANILA v. SPS EDERLINDA &DANIEL MANZO .................................... 541
REPUBLIC OF THE PHILIPPINES v. SPS. LEON GUILALAS and EULALIA SELLERA GUILALAS
..................................................................................................................................................................................... 542
ATTY. MARIETTA D. ZAMORANOS v. PEOPLE OF THE PHILIPPINES et al. ................................. 543
ATIKO TRANS, INC and CHENG LIE NAVIGATION CO., LTD. v. PRUDENTIAL GUARANTEE
AND ASSURANCE, INC........................................................................................................................................ 545
Small Claims ................................................................................................................................................................ 546
ERNESTO Z. ORBE v. JUDGE MANOLITO Y. GUMARANG .................................................................... 546
Doctrine of Exhaustion of Administrative Remedies ................................................................................. 547
UNIVERSAL ROBINA CORP. v. LAGUNA LAKE DEVELOPMENT AUTHORITY ............................ 547
Cause of Action........................................................................................................................................................... 548
VIRRA MALL TENANTS ASSOCIATION, INC. v. VIRRA MALL GREENHILLS ASSOC., INC., et al.
..................................................................................................................................................................................... 548
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED
MININGCOMPANY ............................................................................................................................................... 549
PHILIPPINE ARMY v. SPOUSES MAJOR CONSTANCIOPAMITTAN (Ret.) et al. ........................... 550
DEVELOPMENT BANK OF THE PHILIPPINES v. HON. SILVERIO Q. CASTILLO and
CRISTINA TRINIDAD ZARATE ROMERO .................................................................................................... 552
Real Party in Interest............................................................................................................................................... 552
STEFAN TITO MIÑOZA v. HON. CESAR TOMAS LOPEZ, IN HIS OFFICIAL CAPACITY AS
MAYOR AND CHAIR, et. al................................................................................................................................. 553
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED
MININGCOMPANY ............................................................................................................................................... 554

DEAN’S CIRCLE 2017 xxxii
TOMAS R. OSMEA v. THE COMMISSION ON AUDIT ............................................................................... 555
Death of Party ............................................................................................................................................................. 556
JOSE RAMILO O. REGALADO v. CHAUCER B. REGALADO AND GERARD R. CUEVAS ............... 556
Venue ............................................................................................................................................................................. 557
GOLDEN ARCHES DEVELOPMENT CORPORATION v. ST. FRANCIS SQUARE HOLDINGS, INC.
..................................................................................................................................................................................... 557
Service/Notice............................................................................................................................................................ 558
REPUBLIC OF THE PHILIPPINES v. RESINS, INCORPORATED ......................................................... 558
MA. LIGAYA B. SANTOS v. LITTON MILLS INCORPORATED .............................................................. 559
Multiplicity of Suits .................................................................................................................................................. 560
ARTURO SARTE FLORES v. SPOUSES ENRICO L. LINDO, JR. and EDNA C. LINDO .................... 560
Payment of Docket Fees ......................................................................................................................................... 561
SAMUEL JULIAN v. DEVELOPMENT BANK OF THEPHILIPPINES and THE CITY SHERIFF... 561
PACIFIC UNION INSURANCE COMPANY v. CONCEPTS & SYSTEMS DEVELOPMENT,
INCORPORATED ................................................................................................................................................... 562
DAVID LU v. PATERNO LU YM, SR., et al. .................................................................................................... 562
DO-ALL METALS INDUSTRIES, INC., et al. v. SECURITY BANK CORP., et al. ................................ 564
Litis Pendencia/Res Judicata (Forum Shopping) ........................................................................................ 565
HEIRS OF MAXIMINO DERLA, et. al v. HEIRS OF CATALINA DERLA VDA. DE HIPOLITO, et al.
..................................................................................................................................................................................... 565
PRESIDENTIALCOMMISSION ON GOOD GOVERNMENT (PCGG) v. SANDIGANBAYAN (Second
Division), TOURIST DUTY FREE SHOPS, INC. (TDFSI), BANK OF AMERICA and RIZAL
COMMERCIAL BANKING CORPORATION (RCBC) .................................................................................. 566
ASIA UNITED BANK, CHRISTINE T. CHAN, AND FLORANTE C. DEL MUNDO v. GOODLAND
COMPANY, INC. ..................................................................................................................................................... 568
BANK OF THE PHILIPPINE ISLANDS v. PIO ROQUE S. COQUIA, JR. ................................................ 569
JOHN ANTHONY B. ESPIRITU, et al. v. MANUEL N. TANKIANSEE et al. ........................................ 570
SOCIAL SECURITY COMMISSION v. RIZAL POULTRY and LIVESTOCK ASSOCIATION, INC., et
al. ................................................................................................................................................................................. 572
MAKING ENTERPRISES, INC. AND SPOUSES JOAQUIN TAMANO AND ANGELITA TAMANO v.
JOSE MARFORI AND EMERENCIANA MARFORI ..................................................................................... 573
Verification .................................................................................................................................................................. 574
MAKILITO B. MAHINAY v. HON. IRENEO LEE GAKO, JR., Presiding Judge, RTC-Br.5, Cebu City
and JOCELYN B. SORENSEN ............................................................................................................................. 574
EDITO PAGADORA v. JULIETA S. ILAO ........................................................................................................ 575
FRANCIS BELLO, represented herein by his daughter and attorney-in-fact, Geraldine Bello-
Ona v. BONIFACIO SECURITY SERVICES, INC. and SAMUEL TOMAS ............................................. 576

DEAN’S CIRCLE 2017 xxxiii
Summons ...................................................................................................................................................................... 577
REPUBLIC OF THE PHILIPPINES, represented by the Department of Public Works and
Highways, through the Hon. Secretary, HERMOGENES EBDANE v. ALBERTO A. DOMINGO577
Motion to Dismiss ..................................................................................................................................................... 578
SEVERINO S. CAPIRAL v. SIMEONA CAPIRAL ROBLES and VICENTE CAPIRAL ........................ 578
ORLANDO A. RAYOS, et. al v. THE CITY OF MANILA ............................................................................. 579
Dismissal of Actions ................................................................................................................................................. 580
PHILIPPINE CHARTER INSURANCE CORPORATION v. EXPLORER MARITIME CO., LTD.,
OWNER OF THE VESSEL M/V EXPLORER, et al. ..................................................................................... 580
Pre-Trial ........................................................................................................................................................................ 582
TRINIDAD ALICER, et. al v. ALBERTO COMPAS, et al. ........................................................................... 582
NATIONAL POWER CORPORATION, represented by its President CYRIL DEL CALLAR v.
JUDGE SANTOS B. ADIONG, RTC, BRANCH 8, MARAWI CITY ............................................................ 583
Computation of Time ............................................................................................................................................... 584
SPOUSES RUBEN and MYRNA LEYNES v. FORMER TENTH DIVISION OF THE COURT OF
APPEALS, et al. ...................................................................................................................................................... 584
Judgment ...................................................................................................................................................................... 584
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) v. GROUP MANAGEMENT
CORPORATION (GMC) AND LAPU-LAPU DEVELOPMENT & HOUSING CORPORATION
(LLDHC) ................................................................................................................................................................... 584
JOEB ALIVIADO, et. al v. PROCTER & GAMBLE PHILS., INC., et al. ................................................... 585
AIRLINE PILOTS ASSOCIATION OF THE PHILIPPINES v. PHILIPPINE AIRLINES, INC. .......... 586
TOBIAS SELGA and CEFERINA GARANCHO SELGA v. SONY ENTIERRO BRAR, represented by
her Attorney-in-Fact MARINA T. ENTIERRO ............................................................................................ 588
SPS EULOGIA & RAMON MANILA v. SPS EDERLINDA &DANIEL MANZO .................................... 589
THE LAW FIRM OF RAYMUNDO A. ARMOVIT v. COURT OF APPEALS and BENGSON
COMMERCIAL BUILDING, INC. ....................................................................................................................... 590
COL. FRANCISCO DELA MERCED, substituted by his heirs namely, LUIS CESAR DELA
MERCED, et. al v. GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) and Spouses VICTOR
and MILAGROS MANLONGAT ......................................................................................................................... 591
NILO PADRE v. FRUCTOSA BADILLO, et al. ............................................................................................... 592
REPUBLIC OF THE PHILIPPINES v. SPOUSES FLORENCIO DE CASTRO and ROMELIA
CALIBOSO DE CASTRO ....................................................................................................................................... 593
DANILO L. PAREL v. HEIRS OF SIMEON PRUDENCIO ........................................................................... 594
ANICETO CALUBAQUIB, et al. v. REPUBLIC OF THE PHILIPPINES ................................................. 595
MAXIMINA A. BULAWAN v. EMERSON B. AQUENDE ............................................................................ 596
SPOUSES JUANITO MAHUSAY AND FRANCISCA MAHUSAY v. B.E. SAN DIEGO, INC............... 597

DEAN’S CIRCLE 2017 xxxiv
MANUEL YBIERNAS et al. v. ESTER TANCO-GABALDON, et al. ........................................................ 598
EUGENIO BASBAS, et. al v. BEATA SAYSON and ROBERTO SAYSON, JR. ...................................... 599
PILIPINO TELEPHONE CORPORATION v. RADIOMARINE NETWORK (SMARTNET)
PHILIPPINES, INC................................................................................................................................................. 600
Motion for Reconsideration .................................................................................................................................. 601
ELLERY MARCH G. TORRES v. PAGCOR, represented by ATTY. CARLOS R. BAUTISTA, JR., 601
FERNANDO V. GONZALES v. COMMISSION ON ELECTIONS, et al. .................................................. 603
SPOUSES ANTONIO F. ALAGAR AND AURORA ALAGAR v. PHILIPPINE NATIONAL BANK .. 604
Extrinsic Fraud........................................................................................................................................................... 605
PEOPLE OF THE PHILIPPINES, et. al v. HON. COURT OF APPEALS,AND SOCORRO FLORECE
..................................................................................................................................................................................... 605
AFP MUTUAL BENEFITASSOCIATION, INC. v. REGIONAL TRIAL COURT, MARIKINA CITY
BRANCH 193 and SOLID HOMES, INC. ........................................................................................................ 606
Execution, Satisfaction and Effect of Judgments .......................................................................................... 607
SPOUSES FRANCISCO D. YAP and WHELMA S. YAP v. SPOUSES ZOSIMO DY, SR., et al. ......... 607
YOLANDA LEACHON CORPUZ v. SERGIO V. PASCUA, Sheriff III. Municipal Trial Court in
Cities, Trece Martires City, Cavite ................................................................................................................. 608
TERESITA GUERRERO-BOYLON v. ANICETO BOYLES, Sheriff III, ................................................... 610
Municipal Trial Court in Cities, Branch 2, Cebu City.............................................................................. 610
RUBEN C. REYES v. TANG SOAT ING (JOANNA TANG) and ANDO G. SY ....................................... 611
SPOUSES BENJAMIN and NORMA GARCIA v. ESTER GARCIA, et al. ............................................... 612
PROSERPINA V. ANICO v. EMERSON B. PILIPIA, Sheriff IV, Office of the Clerk of Court,
Regional Trial Court, Manila ............................................................................................................................ 613
Appeal ............................................................................................................................................................................ 614
SPOUSES ROGELIO MARCELO and MILAGROS MARCELO v. LBC BANK ...................................... 614
LAND BANK OF THE PHILIPPINES v. COURT OF APPEALS and ELIZABETH DIAZ,
represented by FRANCISCA P. DE GUZMAN as Attorney-in-Fact .................................................... 615
REBECCA T. ARQUERO v. CA, et al. ............................................................................................................... 616
..................................................................................................................................................................................... 617
METROPOLITAN BANK & TRUST COMPANY v. SPOUSES EDMUNDO MIRANDA and JULIE
MIRANDA ................................................................................................................................................................ 618
BARANGAY DASMARIAS v. CREATIVE PLAY CORNERSCHOOL, et al............................................. 619
ALEXANDER B. GATUS v. SOCIAL SECURITY SYSTEM ......................................................................... 620
SPS. IRENEO T. FERNANDO v. MARCELINO T. FERNANDO ............................................................... 621

DEAN’S CIRCLE 2017 xxxv
SPOUSES AMADO O. IBAEZ and ESTHER A. RAFAEL-IBAEZ v. REGISTER OF DEEDS
OF MANILA AND CAVITE and PHILIPPINE VETERANS BANK (PVB) ............................................ 622
F.A.T. KEE COMPUTER SYSTEMS, INC. v. ONLINE NETWORKS INTERNATIONAL, INC. ........ 622
AURORA B. GO v. ELMER SUNBANUN et al. .............................................................................................. 623
MARCELO G. GANADEN, et al. v. THE HONORABLE COURT OF APPEALS, et al. ....................... 624
THE ESTATE OF SOLEDAD MANINANG AND THE LAW FIRM OF QUISUMBING TORRES v.
THE HONORABLE COURT OF APPEALS, et al. ......................................................................................... 625
HEIRS OF RODOLFO CRISOSTOMO (EUPROCINIA, ROYCE and IRISH CRISOSTOMO) v. RUDEX
INTERNATIONAL DEVELOPMENT CORPORATION............................................................................... 627
D. M. WENCESLAO AND ASSOCIATES, INC. v. CITY OF PARANAQUE, et al. ................................ 628
Provisional Remedies .............................................................................................................................................. 629
ADVENT CAPITAL AND FINANCE CORPORATION v. ROLAND YOUNG ........................................ 629
THUNDER SECURITY AND INVESTIGATION AGENCY/LOURDES M. LASALA v. NATIONAL
FOOD AUTHORITY (REGION I) and NFA REGIONAL BIDS AND AWARDS COMMITTEE
(REGION I) .............................................................................................................................................................. 630
SPS. GONZALO T. DELA ROSA & CRISTETA DELA ROSA v. HEIRS OF JUAN VALDEZ and
SPOUSES POTENCIANO MALVAR AND LOURDES MALVAR .............................................................. 631
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT (PCGG) v. SANDIGANBAYAN
(Second Division), TOURIST DUTY FREE SHOPS, INC. (TDFSI), BANK OF AMERICA and RIZAL
COMMERCIAL BANKING CORPORATION (RCBC) .................................................................................. 633
SPOUSES ISAGANI AND DIOSDADO CASTRO v. SPOUSES REGINO SE ANDVIOLETA DELA
CRUZ, et al. .............................................................................................................................................................. 634
MILAGROS SALTING v. JOHN VELEZ and CLARISSA R. VELEZ ......................................................... 635
HON. EDUARDO ERMITA v. HON. JENNY LIND R. ALDECOA-DELORINO, et al. ......................... 637
Special Civil Actions ................................................................................................................................................. 638
HOME DEVELOPMENT MUTUAL FUND (HDMF) v. SPOUSES FIDEL AND FLORINDA SEE
AND SHERIFF MANUEL L. ARIMADO .......................................................................................................... 638
ERIC YU v. HONORABLE JUDGE AGNES REYES-CARPIO, in her official capacity as Presiding
Judge, Regional Trial Court of Pasig-Branch 261 and CAROLINE T. YU ........................................ 639
MARIA LAARNI L. CAYETANO v. THE COMMISSION ON ELECTIONS AND DANTE O. TINGA
..................................................................................................................................................................................... 640
REPUBLIC OF THE PHILIPPINES v. CPO MAGDALENO PERALTA (Ret.), et al. .......................... 641
FERDINAND A. CRUZ v. JUDGE HENRICK F. GINGOYON, [Deceased], JUDGE JESUS B. MUPAS,
Acting Presiding Judge, Regional Trial Court Branch 117, Pasay City ........................................... 642
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED MINING
COMPANY ................................................................................................................................................................ 643
CHINA BANKING CORPORATION v. ARMI S. ABEL ................................................................................ 644
CEFERINA LOPEZ TAN v. SPOUSES APOLINAR P. ANTAZO and GENOVEVA O. ANTAZO ..... 645

DEAN’S CIRCLE 2017 xxxvi
SPS. VICENTE DIONISIO AND ANITA DIONISIO v. WILFREDO LINSANGAN............................... 646
ROSA DELOS REYES v. SPOUSES FRANCISCO ODONES , et al. .......................................................... 648
ALEJANDRO S. URRO, IN HIS CAPACITY AS THE NEW APPOINTEE VICE HEREIN
PETITIONER HON. LUIS MARIO M. GENERAL, NATIONAL POLICE COMMISSION ................... 649
SPOUSES MANUEL AND FLORENTINA DEL ROSARIO v. GERRY ROXAS FOUNDATION, INC.
..................................................................................................................................................................................... 650
CRISTINA TRINIDAD ZARATE ROMERO .................................................................................................... 650
CITY OF MANILA v. MELBA TAN TE............................................................................................................. 651
EDNA LOPEZ DELICANO, EDUARDO ALBERTO LOPEZ, MARIO DIEZ CRUZ,HOWARD E.
MENESES, and CORAZON E. MENESES v. PECHATEN CORPORATION ......................................... 652
PHILIPPINE GUARDIANS BROTHERHOOD, INC., REPRESENTED BY ITS SECRETARY-
GENERAL GEORGE “FGBF GEORGE” DULDULAO v. COMMISSION ON ELECTIONS (COMELEC)
..................................................................................................................................................................................... 654
ALTERNATIVE DISPUTE RESOLUTION .................................................................................. 655
LICOMCEN INCORPORATED v. FOUNDATION SPECIALISTS, INC. .................................................. 655
EVIDENCE ........................................................................................................................................ 656
Chain of Custody........................................................................................................................................................ 656
PEOPLE OF THE PHILIPPINES v. ALBERTO BACUS ALCUIZAR ........................................................ 657
FRANCISCO IMSON y ADRIANO v. PEOPLE OF THE PHILIPPINES ................................................. 658
PEOPLE OF THE PHILIPPINES v. JHON-JHON ALEJANDRO y DELA CRUZ @ NOGNOG.......... 659
CESAR D. CASTRO v. PEOPLE OF THE PHILIPPINES............................................................................. 660
PEOPLE OF THE PHILIPPINES v. ADRIANO PASCUA y CONCEPCION ........................................... 661
PEOPLE OF THE PHILIPPINES v. LUIS PAJARIN y DELA CRUZ and EFREN
PALLAYA y TUVIERA .......................................................................................................................................... 662
PEOPLE OF THE PHILIPPINES v. JACQUILINE PAMBID y CORTEZ................................................. 663
PEOPLE OF THE PHILIPPINES v. SEVILLANO DELOS REYES y LANTICAN ................................. 664
PEOPLE OF THE PHILIPPINES v. RUFINO VICENTE, JR. y CRUZ ...................................................... 665
PEOPLE OF THE PHILIPPINES v. ERLINDA CAPUNO y TISON .......................................................... 666
Sufficiency of Evidence ........................................................................................................................................... 667
PEOPLE OF THE PHILIPPINES v. ROLANDO LAYLO y CEPRES......................................................... 667
PEOPLE OF THE PHILIPPINES v. ANDREW ROBLE ............................................................................... 668
Judicial Admission .................................................................................................................................................... 669
LANDOIL RESOURCES CORPORATION v. AL RABIAH LIGHTING COMPANY ............................. 669

DEAN’S CIRCLE 2017 xxxvii
REPUBLIC OF THE PHILIPPINES, represented by the Chief of the Philippine National Police
v. THI THU THUY T. DE GUZMAN .................................................................................................................. 670
Best Evidence Rule ................................................................................................................................................... 672
RICO ROMMEL ATIENZA v. BOARD OF MEDICINE and EDITHA SIOSON .................................... 672
Extrajudicial Confession......................................................................................................................................... 673
PEOPLE OF THE PHILIPPINES v. RODOLFO CAPITLE and ARTURO NAGARES ........................ 673
Hearsay ......................................................................................................................................................................... 674
SOCIAL SECURITY COMMISSION AND SOCIAL SECURITY SYSTEM v. TERESA G. AVILA ...... 674
Previous Conduct as Evidence ............................................................................................................................. 675
METROPOLITAN BANK AND TRUST COMPANY v. MARINA B. CUSTODIO ................................. 675
Res Gestae .................................................................................................................................................................... 676
PEOPLE OF THE PHILIPPINES v. ROMY FALLONES Y LABANA ....................................................... 676
Deposition at a Former Proceeding................................................................................................................... 677
REPUBLIC OF THE PHILIPPINES v. SANDIGANBAYAN (FOURTH DIVISION), et al. ................ 677
Expert Testimony...................................................................................................................................................... 678
EDWIN TABAO y PEREZ v. PEOPLE OF THE PHILIPPINES ................................................................ 678
Conclusive Presumption ........................................................................................................................................ 680
ENRICO SANTOS v. NATIONAL STATISTICS OFFICE ............................................................................ 680
Authentication and Proof of Documents ......................................................................................................... 681
ADELAIDA MENESES (deceased), substituted by her heir MARILYN M. CARBONEL-GARCIA v.
ROSARIO G. VENTUROZO ................................................................................................................................. 681
Substantial Evidence ............................................................................................................................................... 683
STERLING SELECTIONS CORPORATION v. LAGUNA LAKE DEVELOPMENT AUTHORITY
(LLDA) AND JOAQUIN G. MENDOZA, IN HIS CAPACITY AS GENERAL MANAGER OF LLDA 683
PTE., LTD. ................................................................................................................................................................ 684
ABOSTA SHIPMANAGEMENT CORPORATION v. NATIONAL LABOR RELATIONS
COMMISSION (FIRST DIVISION) and ARNULFO R. FLORES .............................................................. 685
Circumstantial Evidence ........................................................................................................................................ 686
BENJAMIN JESALVA v. PEOPLE OF THE PHILIPPINES......................................................................... 686
PEOPLE OF THE PHILIPPINES v. FEDERICO LUCERO .......................................................................... 688
Alibi/Denial ................................................................................................................................................................. 689
PEOPLE OF THE PHILIPPINES v. JUANITO APATTAD .......................................................................... 689
PEOPLE OF THE PHILIPPINES v. AVELINO SUBESA y MOSCARDON............................................. 690
Inconsistencies........................................................................................................................................................... 691

DEAN’S CIRCLE 2017 xxxviii
PEOPLE OF THE PHILIPPINES v. EVANGELINE SOBANGEE y EDAO ............................................. 691
PEOPLE OF THE PHILIPPINES v. EDGARDO FERMIN Y GREGORIO AND JOB MADAYAG, JR., Y
BALDERAS............................................................................................................................................................... 692
RADITO AURELIO y REYES v. PEOPLE OF THE PHILIPPINES ........................................................... 693
DNA ................................................................................................................................................................................. 694
JESSE U. LUCAS v. JESUS S. LUCAS................................................................................................................. 694
SPECIAL PROCEEDINGS .............................................................................................................. 695
Settlement of Estate ................................................................................................................................................. 695
RAMON S. CHING AND PO WING PROPERTIES, INC. v. HON. JANSEN R. RODRIGUEZ, in his
capacity as Presiding Judge of the RTC-Br.6 of Manila, et al. ............................................................. 695
EDUARDO G. AGTARAP v. SEBASTIAN AGTARAP, et. al. ..................................................................... 697
her Attorney-in-Fact MARINA T. ENTIERRO ............................................................................................ 698
ATTY. RICARDO B. BERMUDO v. FERMINA TAYAG-ROXAS ............................................................... 700
DIOSDADO S. MANUNGAS v. MARGARITA AVILA LORETO and FLORENCIA AVILA PARREO
..................................................................................................................................................................................... 701
Writ of Amparo .......................................................................................................................................................... 702
ARTHUR BALAO, et al. v. GLORIA MACAPAGAL-ARROYO, et al. ...................................................... 702
LT. COL. ROGELIO BOAC, et. al. v. ERLINDA T. CADAPAN AND CONCEPCION E. EMPEÑO.. 703
EDITA BURGOS v. PRESIDENT GLORIA MACAPAGAL-ARROYO, et al............................................ 704
Cancellation or Correction of Entries in the Civil Registry ...................................................................... 705
REPUBLIC OF THE PHILIPPINES v. JULIAN EDWARD EMERSON COSETENG-MAGPAYO .... 705
LEGAL PROFESSION AND THE PRACTICE OF LAW ............................................................ 707
Nature and Characteristics of Disciplinary Actions .................................................................................... 707
RE: LETTER-COMPLAINT OF ATTY. ARIEL SAMSON C. CAYETUNA, et al. .................................. 707
RE: ANONYMOUS LETTER RELATIVE TO THE ALLEGED CORRUPTION IN THE COURT OF
APPEALS, CAGAYAN DE ORO CITY ............................................................................................................... 708
OFFICE OF THE COURT ADMINISTRATOR (OCA) vs. JESUS VINCENT M. CARBON III,
formerly Clerk III, Regional Trial Court, Zamboanga City ................................................................... 708
MAKILITO B. MAHINAY vs. HON. IRENEO LEE GAKO, JR., Presiding Judge, RTC-Br.5, Cebu
City and JOCELYN B. SORENSEN; JOCELYN B. SORENSEN vs. MAKILITO B. MAHINAY ......... 709
DUTIES AND RESPONSIBILITIES OF A LAWYER ................................................................. 711
Duties and Responsibilities of a Lawyer to the Society............................................................................. 711
RE: RESOLUTION OF THE COURT DATED 1 JUNE 2004 IN G.R. NO. 72954 AGAINST ATTY.
VICTOR C. AVECILLA .......................................................................................................................................... 711

DEAN’S CIRCLE 2017 xxxix
RODOLFO A. ESPINOSA and MAXIMO A. GLINDO v. ATTY JULIETA A. OMAÑA ........................ 711
Duties and Responsibilities of a Lawyer to the Legal Profession ......................................................... 712
TOMAS P. TAN, JR. v. ATTY. HAIDE V. GUMBA, ........................................................................................ 712
PACITA CAALIM-VERZONILLA v. ATTY. VICTORIANO G. PASCUA ................................................ 713
Duties and Responsibilities of a Lawyer to the Courts .............................................................................. 714
TERESITA D. SANTECO v. ATTY. LUNA B. AVANCE ............................................................................... 714
RE: LETTER OF THE UP LAW FACULTY ENTITLED RESTORING INTEGRITY: A STATEMENT
BY THE FACULTY OF THE UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW ON THE
ALLEGATIONS OF PLAGIARISM AND MISREPRESENTATION IN THE COURT .......................... 715
JUDGE RENE B. BACULI vs. ATTY. MELCHOR A. BATTUNG ............................................................... 716
Duties and Responsibilities of a Lawyer to his Clients .............................................................................. 717
ERLINDA R. TAROG v. ATTY. ROMULO L. RICAFORT ........................................................................... 717
PATRICIO GONE v. ATTY. MACARIO GA ..................................................................................................... 718
NEMESIO FLORAN and CARIDAD FLORAN v. ATTY. ROY PRULE EDIZA ..................................... 719
ROGELIO ESTAVILLO v. ATTYS. GEMMO GUILLERMO and ERME LABAYOD ........................... 720
MARITES FREEMAN v. ATTY. ZENAIDA REYES ...................................................................................... 721
LYDIA CASTRO-JUSTO v. ATTY. RODOLFO GALING .............................................................................. 722
2004 RULES ON NOTARIAL PRACTICE .................................................................................. 722
RIZALINA L. GEMINA v. ATTY. ISIDRO S. MADAMBA ........................................................................... 722
ATTY. FLORITA S. LINCO v. ATTY. JIMMY D. LACEBAL ........................................................................ 723
JUDICIAL ETHICS........................................................................................................................... 724
Impartiality of Judges .............................................................................................................................................. 724
ATTY. FACUNDO T. BAUTISTA v. jUDGE BLAS O. CAUSAPIN, JR., Presiding Judge, Regional
Trial Court, Branch 32, Guimba, Nueva Ecija............................................................................................ 725
Propriety of Judges ................................................................................................................................................... 725
MANSUETA T. RUBIN vs. JUDGE JOSE Y. AGUIRRE, JR. ........................................................................ 726
VICTORIANO SY vs. Judge OSCAR DINOPOL, Regional Trial Court, Branch 24, Koronadal City
..................................................................................................................................................................................... 727
VIVIAN T. DABU v. EDUARDO RODEN E. KAPUNAN, MA. THERESA CORTEZ, LEILA O. GALO
AND SUZETTE O. TIONGCO.............................................................................................................................. 728
ASHARY M. ALAUYA, CLERK OF COURT, SHARI'A DISTRICT COURT, MARAWI CITY v. JUDGE
CASAN ALI L. LIMBONA, SHARI'A CIRCUIT COURT, LANAO DEL SUR, ......................................... 729
OFFICE OF THE COURT ADMINISTRATOR v. JUDGE MA. ELLEN M. AGUILA ............................. 730
Diligence of Judges ................................................................................................................................................... 731
PROSECUTOR HILARIO RONSON H. TILAN v. JUDGE ESTER PISCOSO-FLOR ............................ 731

DEAN’S CIRCLE 2017 xl
OFFICE OF THE COURT ADMINISTRATOR vs. FORMER JUDGE LEONARDO L. LEONIDA, OF
THE REGIONAL TRIAL COURT BRANCH 27, STA. CRUZ, LAGUNA.................................................. 732
JOSEFINA NAGUIAT v. JUDGE MARIO B. CAPELLAN ............................................................................. 733
ATTY. RANDY P. BARENG v. JUDGE ZENAIDA R. DAGUNA................................................................. 734
Competence of Judges ............................................................................................................................................. 734
SPOUSES DEMOCRITO AND OLIVIA LAGO vs. JUDGE GODOFREDO B. ABUL, JR. ..................... 734
OFFICE OF THE COURT ADMINISTRATOR vs. JUDGE BENJAMIN P. ESTRADA and JUDGE
JOSEFINA GENTILES-BACAL ........................................................................................................................... 735
IMELDA R. MARCOS vs. JUDGE FERNANDO VIL PAMINTUAN .......................................................... 736
IN THE MATTER OF THE CHARGES OF PLAGIARISM, ETC. AGAINST ASSOCIATE JUSTICE
MARIANO C. DEL CASTILLO. ........................................................................................................................... 737
GAUDENCIO B. PANTILO III v. JUDGE VICTOR A. CANOY ................................................................... 738
JOSEPHINE JAZMINES TAN v. JUDGE SIBANAH E. USMAN ................................................................ 739
LYDELLE L. CONQUILLA v. JUDGE LAURO G. BERNARDO .................................................................. 739
MARCIANO ALCARAZ v. JUDGE FATIMA GONZALES-ASDALA ......................................................... 740
RENE C. RICABLANCA v. JUDGE HECTOR B. BARILLO ......................................................................... 741
JUDGE NAPOLEON INOTURAN v. JUDGE MANUEL Q. LIMSIACO, JR., ............................................ 742
LYDIA A. BENANCILLO v. Judge VENANCIO J. AMILA ........................................................................... 743
ATTY. RAFAEL T. MARTINEZ, and SPOUSES DAN and EDNA REYES v. JUDGE GRACE
GLICERIA F. DE VERA ......................................................................................................................................... 744
RE: COMPLAINT OF CONCERNED MEMBERS OF CHINESE GROCERS ASSOCIATION (CGA)
AGAINST JUSTICE SOCORRO B. INTING OF THE COURT OF APPEALS ......................................... 745
ETHICS OF OTHER COURT EMPLOYEES ................................................................................ 745
Custody of Court and Other Funds .................................................................................................................... 745
OFFICE OF THE COURT ADMINISTRATOR vs. VICTORIO A. DION .................................................. 745
OFFICE OF THE COURT ADMINISTRATOR vs. MARISSA U. ANGELES........................................... 746
OFFICE OF THE COURT ADMINISTRATOR v. MS. MIRA THELMA V. ALMIRANTE................... 747
OFFICE OF THE COURT ADMINISTRATOR v. ATTY. MAGDALENA L. LOMETILLO, Former
Clerk of Court VII, VICTORIA S. PATOPATEN, Cashier II, LINDA C. GUIDES, Administrative
Officer I, LENNY GEMMA P. CASTILLO, Clerk III, and BRENDA M. LINACERO, Clerk III, All of
Regional Trial Court, Iloilo City, A.M. No. P-09-2637, ........................................................................... 748
OFFICE OF THE COURT ADMINISTRATOR v. NELIA D.C. RECIO, ET AL. ...................................... 749
OFFICE OF THE COURT ADMINISTRATOR vs. ELSIE C. REMOROZA ............................................. 749
Impartiality and Conflicts of Interest ............................................................................................................... 750
MILAGROS VILLACERAN and OMAR T. MIRANDA v. Judge MAXWEL S. ROSETE and Process
Server EUGENIO TAGUBA ................................................................................................................................ 750

DEAN’S CIRCLE 2017 xli
DANELLA G. SONIDO v. JOSEFINA G. ILOCSO, Clerk III, Regional Trial Court, Branch 80,
Morong, Rizal ......................................................................................................................................................... 751
Compliance with Court Procedures................................................................................................................... 752
MANUEL P. CALAUNAN v. REYNALDO B. MADOLARIA, SHERIFF IV, REGIONAL TRIAL
COURT, BRANCH 217, QUEZON CITY .......................................................................................................... 752
OFFICE OF THE COURT ADMINISTRATOR v. Atty. ROSARIO E. GASPAR ..................................... 753
DY TEBAN TRADING CO., INC. v. ARCHIBALD C. VERGA ..................................................................... 754
MA. CHEDNA ROMERO v. PACIFICO B. VILLAROSA, JR. ....................................................................... 755
JUDGE RENATO A. FUENTES v. ATTY. ROGELIO F. FABRO ................................................................ 756
OFFICE OF THE COURT ADMINISTRATOR v. EFREN E. TOLOSA .................................................... 756
SUSANA E. FLORES v. ARIEL D. PASCASIO ................................................................................................ 757
DEVELOPMENT BANK OF THE PHILIPPINES v. ATTY. JEOFFREY S. JOAQUINO ...................... 758
SUPREME COURT v. EDDIE V. DELGADO, JOSEPH LAWRENCE M. MADEJA, WILFREDO A.
FLORENDO .............................................................................................................................................................. 759
Competence of Court Personnel ......................................................................................................................... 760
Judge PHILBERT I. ITURRALDE, MARTIN GUMARANG, et. al. vs. OIC Branch Clerk of Court
BABE SJ. RAMIREZ, Clerk VIOLETA P. FLORDELIZA and Sheriff IV CARLOS A. SALVADOR . 760
FREDDY H. REYES vs. VIVIAN L. PABILANE ............................................................................................. 761
ANGELITA D. MAYLAS v. JUANCHO M. ESMERIA ................................................................................... 762
JUDGE EDILBERTO G. ABSIN v. EDGARDO A. MONTALLA ................................................................. 763
SULTAN PANDAGARANAO A. ILUPA v. MACALINOG S. ABDULLAH .............................................. 763
Discipline of Court Personnel .............................................................................................................................. 764
OFFICE OF THE COURT ADMINISTRATOR vs. CLAUDIO M. LOPEZ............................................... 764
EXECUTIVE JUDGE LEONILO B. APITA v. MARISSA M. ESTANISLAO ............................................ 765
JUDGE JEOFFRE W. ACEBIDO v. LUDYCISSA A. HALASAN, JOEL A. LARGO............................... 766
EMMANUEL M. GIBAS, JR., v. MA. JESUSA E. GIBAS and FRANCONELLO S. LINTAO .............. 767
MARY JANE ABANAG v. NICOLAS B. MATUTE ......................................................................................... 767
AN ANONYMOUS COMPLAINT AGAINST ATTY. PORTIA DIESTA, BRANCH CLERK OF COURT,
REGIONAL TRIAL COURT, BRANCH 263, PASIG CITY and LUZ SANTOS-TACLA, CLERK III,
SAME COURT ......................................................................................................................................................... 768
JOHN A. MENDEZ, ANGELITO CABALLERO and IVY CABALLERO v. NERISSA A. BALBUENA
..................................................................................................................................................................................... 769
LINA LAURIA-LIBERATO VS. NESTOR M. LELINA ................................................................................. 770
FALSIFICATION OF DAILY TIME RECORDS OF MA. EMCISA A. BENEDICTOS ........................... 771

DEAN’S CIRCLE 2017 xlii
POLITICAL AND PUBLIC INTERNATIONAL LAW
EXECUTIVE DEPARTMENT
DATU ZALDY UY AMPATUAN, et al. v. HON. RONALDO PUNO, et al.

G.R. No. 190259, 7 June 2011, EN BANC (Abad, J.)
The President’s call on the armed forces to prevent or suppress lawless violence springs from the
power vested in her under Section 18, Article VII of the Constitution.
A day after the Maguindanao Massacre in 2009, then President Gloria Macapagal-Arroyo
issued Proclamation 1946, placing the Provinces of Maguindanao and Sultan Kudarat and the City
of Cotabato under a state of emergency. President Arroyo also issued Administrative Order 273 (AO
273) initially transferring supervision of the Autonomous Region of Muslim Mindanao (ARMM) from
the Office of the President to the Department of Interior and Local Government (DILG) but later on
amending it by delegating instead of transferring supervision of the ARMM to the DILG through
Administrative Order 273-A (AO 273-A).
Claiming that the Presidents issuances encroached on the ARMMs autonomy, petitioners
Datu Zaldy Uy Ampatuan, Ansaruddin Adiong, and Regie Sahali-Generale, all ARMM officials, filed a
petition for prohibition under Rule 65. They alleged that the proclamation and the orders empowered
the DILG Secretary to take over ARMMs operations and seize the regional governments powers, in
violation of the principle of local autonomy under Republic Act 9054 (also known as the Expanded
ARMM Act) and the Constitution. The President gave the DILG Secretary the power to exercise, not
merely administrative supervision, but control over the ARMM since the latter could suspend ARMM
officials and replace them.Petitioner ARMM officials claimed that the President had no factual basis
for declaring a state of emergency, especially in the Province of Sultan Kudarat and the City
of Cotabato, where no critical violent incidents occurred. The deployment of troops and the taking
over of the ARMM constitutes an invalid exercise of the Presidents emergency powers. Petitioners
asked that Proclamation 1946 as well as AOs 273 and 273-A be declared unconstitutional and that
respondents DILG Secretary, the AFP, and the PNP be enjoined from implementing them.
In its comment for the respondents, the Office of the Solicitor General (OSG) insisted that the
President issued Proclamation 1946, not to deprive the ARMM of its autonomy, but to restore peace
and order in subject places. The President issued the proclamation pursuant to her calling out
power as Commander-in-Chief under the first sentence of Section 18, Article VII of the
Constitution. On the other hand, the President merely delegated her supervisory powers over the
ARMM to the DILG Secretary who was her alter ego any way. The delegation was necessary to
facilitate the investigation of the mass killings. Further, the assailed proclamation and administrative
orders did not provide for the exercise of emergency powers.
ISSUES:
1. Whether Proclamation 1946 and AOs 273 and 273-A violate the principle of local autonomy
under Section 16, Article X of the Constitution, and Section 1, Article V of the Expanded ARMM
Organic Act;
2. Whether President Arroyo invalidly exercised emergency powers when she called out the AFP
and the PNP to prevent and suppress all incidents of lawless violence in Maguindanao, Sultan
Kudarat, and Cotabato City; and
3. Whether the President had factual bases for her actions
RULING:
1. NO. The claim of petitioners that the subject proclamation and administrative orders
violate the principle of local autonomy is anchored on the allegation that, through them, the President
authorized the DILG Secretary to take over the operations of the ARMM and assume direct
governmental powers over the region. But, in the first place, the DILG Secretary did not take over
control of the powers of the ARMM. After law enforcement agents took respondent Governor of
ARMM into custody for alleged complicity in the Maguindanao massacre, the ARMM Vice-Governor,
petitioner Ansaruddin Adiong, assumed the vacated post on December 10, 2009 pursuant to the rule
on succession found in Article VII, Section 12, of RA 9054. In turn, Acting Governor Adiong named the
then Speaker of the ARMM Regional Assembly, petitioner Sahali-Generale, Acting ARMM Vice-
Governor. In short, the DILG Secretary did not take over the administration or operations of the
ARMM.
2. NO. The President did not proclaim a national emergency, only a state of emergency in the
three places mentioned. And she did not act pursuant to any law enacted by Congress that authorized
her to exercise extraordinary powers. The calling out of the armed forces to prevent or suppress
lawless violence in such places is a power that the Constitution directly vests in the President. She
did not need a congressional authority to exercise the same.
3. YES. Petitioners failed to show that the declaration of a state of emergency in the Provinces
of Maguindanao, Sultan Kudarat and Cotabato City, as well as the Presidents exercise of the calling
out power had no factual basis. They simply alleged that, since not all areas under the ARMM were
placed under a state of emergency, it follows that the take over of the entire ARMM by the DILG
Secretary had no basis too.
The imminence of violence and anarchy at the time the President issued Proclamation 1946
was too grave to ignore and she had to act to prevent further bloodshed and hostilities in the places
mentioned. Progress reports also indicated that there was movement in these places of both high-
powered firearms and armed men sympathetic to the two clans. Thus, to pacify the people’s fears and
stabilize the situation, the President had to take preventive action. She called out the armed forces to
control the proliferation of loose firearms and dismantle the armed groups that continuously
threatened the peace and security in the affected places. Since petitioners are not able to demonstrate
that the proclamation of state of emergency in the subject places and the calling out of the armed
forces to prevent or suppress lawless violence there have clearly no factual bases, the Court must
respect the President’s actions.
ATTY. ROMULO B. MACALINTAL v. PRESIDENTIAL ELECTORAL TRIBUNAL

G.R. No. 191618, 7 June 2011, EN BANC (Nachura, J.)
The PET is authorized by the last paragraph of Section 4, Article VII of the Constitution and as
supported by the discussions of the Members of the Constitutional Commission, which drafted the
present Constitution.
Atty. Romulo B. Macalintal filed a Motion for Reconsideration of the court’s Decision in G.R.
No. 191618 dated November 23, 2010, dismissing his petition and declaring the establishment of
respondent Presidential Electoral Tribunal (PET) as constitutional. Atty. Macalintal reiterated his
arguments on the alleged unconstitutional creation of the PET that he has standing to file the petition
as a taxpayer and a concerned citizen; that he is not estopped from assailing the constitution of the
PET simply by virtue of his appearance as counsel of former president Gloria Macapagal-Arroyo
before respondent tribunal; that Section 4, Article VII of the Constitution does not provide for the
creation of the PET; and that the PET violates Section 12, Article VIII of the Constitution. To bolster
his arguments that the PET is an illegal and unauthorized progeny of Section 4, Article VII of the
Constitution, Atty. Macalintal invoked the court’s ruling on the constitutionality of the Philippine
Truth Commission (PTC). He cited the concurring opinion of Justice Teresita J. Leonardo-de Castro
that the PTC is a public office which cannot be created by the President, the power to do so being
lodged exclusively with Congress. Thus, Atty. Macalintal submits that if the President, as head of the
Executive Department, cannot create the PTC, the Supreme Court, likewise, cannot create the PET in
the absence of an act of legislature.
On the other hand, in its Comment to the Motion for Reconsideration, the Office of the
Solicitor General maintains that the constitution of the PET is on firm footing on the basis of the grant
of authority to the Supreme Court to be the sole judge of all election contests for the President or
Vice-President under paragraph 7, Section 4, Article VII of the 1987 Constitution.
ISSUE:
Whether the PET is constitutional.
RULING:
YES. The Supreme Court reiterated that the abstraction of the Supreme Court acting as
a Presidential Electoral Tribunal from the unequivocal grant of jurisdiction in the last paragraph of
Section 4, Article VII of the Constitution is sound and tenable. The explicit reference by the framers
of our Constitution to constitutionalizing what was merely statutory before is not diluted by the
absence of a phrase, line or word, mandating the Supreme Court to create a Presidential Electoral
Tribunal. Suffice it to state that the Constitution, verbose as it already is, cannot contain the specific
wording required by petitioner in order for him to accept the constitutionality of the PET. Judicial
power granted to the Supreme Court by the same Constitution is plenary. And under the doctrine of
necessary implication, the additional jurisdiction bestowed by the last paragraph of Section 4, Article
VII of the Constitution to decide presidential and vice-presidential elections contests includes the
means necessary to carry it into effect.
Petitioner’s application of our decision in Biraogo v. Philippine Truth Commission to the

present case is an unmitigated quantum leap. The decision therein held that the PTC finds
justification under Section 17, Article VII of the Constitution. A plain reading of the constitutional
provisions, i.e., last paragraph of Section 4 and Section 17, both of Article VII on the Executive Branch,
reveals that the two are differently worded and deal with separate powers of the Executive and the
Judicial Branches of government. And as previously adverted to, the basis for the constitution of the
PET was, in fact, mentioned in the deliberations of the Members of the Constitutional Commission
during the drafting of the present Constitution.
BARANGAY CAPTAIN BEDA TORRECAMPO v. METROPOLITAN WATERWORKS AND

SEWERAGE SYSTEM
G.R. No. 188296, 30 May 2011, SECOND DIVISION (Carpio, J.)
The determination of where, as between two possible routes, to construct a road extension is
obviously not within the province of this Court. Such determination belongs to the Executive branch.
Barangay Captain Beda Torrecampo (Torrecampo) of Barangay Matandang Balara, Quezon

City, in his capacity as taxpayer and on behalf of his barangay constituents and eight million Metro
Manila residents, filed a Petition for Injunction with prayer for issuance of a Temporary Restraining
Order and Writ of Preliminary Injunction against respondents Manila Waterworks and Sewerage
System (MWSS) and Diosdado Jose M. Allado (Allado) in his official capacity as Administrator, and
the Department of Public Works and Highways (DPWH) and Hermogenes Ebdane (Ebdane) in his
official capacity as Secretary.
Torrecampo sought to enjoin respondents from implementing the Circumferential Road 5 (C-
5) Extension Project over Lot Nos. 42-B-2-A, 42-A-6 and 42-A-4 (subject lots), all of which are owned
by the MWSS. Torrecampo alleged that if the MWSS and the DPWH are allowed to continue and
complete the C-5 Road Extension Project within Barangay Matandang Balara, three aqueducts of the
MWSS which supply water to eight million Metro Manila residents will be put at great
risk. Torrecampo insisted that the RIPADA area, consisting of Pook Ricarte, Pook Polaris
and Pook Dagohoy, located in Barangay University of the Philippines (UP), Diliman, Quezon City, is a
better alternative to subject lots. The MWSS seeks the dismissal of Torrecampo’s petition on the
ground that the petition failed to allege Torrecampo’s right that warrants the issuance of an
injunction under R.A. 8975. The DPWH also limits the issue to Torrecampo’s entitlement to an
injunctive writ.
ISSUE:
Whether respondents should be enjoined from commencing with and implementing the C-5
Road Extension Project along Tandang Sora Road, affecting MWSS properties
RULING:
NO. Despite the definition of judicial power under Section 1, Article VIII of the Constitution, an
inquiry on issues raised by Torrecampo would delve into matters that are exclusively within the
wisdom of the Executive branch. The determination of where, as between two possible routes, to
construct a road extension is obviously not within the province of this Court. Such determination
belongs to the Executive branch. Moreover, in this case the DPWH still has to conduct the proper
study to determine whether a road can be safely constructed on land beneath which runs the
aqueducts. Without such study, the MWSS, which owns the land, cannot decide whether to allow the
DPWH to construct the road. Absent such DPWH study and MWSS decision, no grave abuse of
discretion amounting to lack of jurisdiction can be alleged against or attributed to respondents
warranting the exercise of this Courts extraordinary certiorari power.
PROF. MERLIN MAGALLONA, et al. v. HON. EDUARDO ERMITA, et al.

G.R. No. 187167, 16 August 2011, EN BANC (Carpio, J.)
RA No. 9522 is consistent with constitutional provision on territorial integrity, with the
Philippines’ claim of sovereignty over KIG and Scarborough Shoal, and with delineation of internal
waters. This serves as notice to the international community of the scope of maritime space over which
the Philippines can exercise its treaty- based rights.
In 1961, Congress passed Republic Act No. 3046 which demarcated the maritime baselines of
the Philippines as an archipelagic state by using the straight line base method. This followed the
framing of Convention on the Territorial Sea and Contiguous Zone which codified the rights of state
party to its territorial sea. RA No. 3046 remained unchanged for five decades. In March 2009,
Congress amended RA No. 3046 by enacting RA No. 9522 to comply with the terms of United Nations
Convention on the Law of the Sea III (UNCLOS III) on water- land ratio, length, and contour of
baselines of archipelagic states which was ratified by the Philippines on February 25, 1984. As a
consequence, the one baseline was shortened, location of some base points were optimized, and
classified Kalayaan Island Group (KIG) and Scarborough Shoal as regime of islands. Prof. Merlin
Magallona assailed the constitutionality of RA No. 9522 claiming that the law reduces Philippine
maritime territory, that treating KIG and Scarborough Shoal as Regime of Islands results to loss of a
large maritime area and inconsistent with claim of sovereignty over these areas, that it opens
country’s waters landward of the baselines to maritime passage by all vessels and aircraft. On the
other hand, Hon. Eduardo Ermita insisted that RA No. 9522 is the country’s compliance with the
terms of UNCLOS III and it does not undermine country’s security.
ISSUES:
1. Whether or not RA No. 9522 is constitutional.

2. Whether or not Prof. Magallona, et al. possess locus standi to bring the suit.
RULING:
1. YES. RA No. 9522 is consistent with constitutional provision on territorial integrity, with
the Philippines’ claim of sovereignty over KIG and Scarborough Shoal, and with delineation of internal
waters. First, contrary to Prof. Magallona’s contention, RA No. 9522 did not dismember large portion
of territory because it was passed in compliance with UNCLOS III which is multi lateral treaty that
regulates sea-use rights over maritime zones and continental shelves. RA No. 9522 was enacted to
mark out specific points to serve as starting points in measuring the breadth of maritime zones and
continental shelves making it merely a statutory mechanism for state party to delimit with precision
the extent of said zones. This serves as notice to the international community of the scope of maritime
space over which the Philippines can exercise its treaty- based rights, which are: a) rights to exercise
sovereignty over territorial water; b) jurisdiction to enforce customs, fiscal, immigration, and
sanitation laws in the contiguous zone; and c) exclusive right to exploit the living and non- living
resources in the exclusive economic zone.
Second, RA No. 9522 did not surrender claim over regime of islands. Section 2 of the law
expressly provides for the continued claim of the Philippines to exercise sovereignty and jurisdiction
over KIG and Scarborough Shoal. These two islands lie outward the baseline. To enclose them as part
of the Philippine Archipelago would amount to violation of Article 47(3) of UNCLOS III which requires
that the drawing of baselines shall not depart to any appreciable extent from general configuration of
archipelago and Section 47(2) which provides that the length of the baselines shall not exceed 100
miles.
Third, the Philippine exercises sovereignty over the water lying landward of baselines, whether
referred to as internal water under our Constitution or as archipelagic water under UNCLOS III. RA
No. 9522 did not unconstitutionally convert Philippines’ internal water into archipelagic water.
Absent RA No. 9522, Philippines will be devoid of internationally acceptable baselines. Not having
acceptable baselines may be viewed by other states as an open invitation to freely enter and exploit
the resources in country’s water and can weaken case in any international dispute.RA No. 9522, in
allowing an internationally- recognized delimitation of breadth of the Philippines’ maritime zones
and continental shelf, serves as notice to the whole world and being such, the country can expect
utmost respect from the international community.
2. YES. While it is true that Prof. Magallona, et al. has no locus standi as taxpayers and legislators
because the petition alleges neither misuse of public funds nor infringement of legislative
prerogative, the Court recognizes the locus standi as citizens. Prof. Magallona, et al. has locus standi
to bring suit as citizens with constitutionally sufficient interest in the resolution of the merits of the
case which undoubtedly raises issues of national significance necessitating urgent resolution. Owing
to the peculiar nature of RA No. 9522, it is difficult to find other litigants possessing a more direct and
specific interest to bring suit.
EXPROPRIATION
ANUNCIACION VDA. DE OUANO, MARIANO P. OUANO, et al. v. THE REPUBLIC OF THE

PHILIPPINES, THE MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY, AND THE
REGISTER OF DEEDS FOR THE CITY OF CEBU
G.R. Nos. 168770 & 168812, 9 February 2011, FIRST DIVISION (Velasco, Jr., J.)
If the genuine public necessity the very reason or condition as it were allowing, at the first
instance, the expropriation of a private land ceases or disappears, then there is no more cogent point
for the governments’ retention of the expropriated land. The same legal situation should hold if the
government devotes the property to another public use very much different from the original or deviates
from the declared purpose to benefit another private person.
These are two consolidated petitions for certiorari. National Airport Authority (NAC), the
predecessor of Mactan-Cebu International Airport Authority (MCIAA), sought to expand the Lahug
Airport in Ccebu City. It negotiated with the owners of properties situated around the airport and to
convince the owners to sell their lands, NAC offered to allow the owners to repurchase their lands if
the expansion of the airport does not occur or if it closes its operation. Some of the owners did not
acquiesce to the offer of NAC so the latter was compelled to file a complaint for expropriation
docketed as Civil Case No. R-1881.
The Court of First Instance (CFI) ruled in favor of the NAC. The owners of the subject
properties no longer appealed the decision knowing that they still have the option to repurchase their
lands as promised by NAC. After the titles to the properties were transferred to the now MCIAA,
Lahug Airport ceased its operations. In the first petition for certiorari, Ricardo Inocian, et al. filed a
complaint for reconveyance in the Regional Trial Court (RTC) against MCIAA. Inocian, et al. claimed
that since the airport expansion did not push through, their properties should be returned to them.
MCIAA, on the other hand, countered that since the subject lots were covered by the decision in Civil
Case No. R-1881. He also found out that the said decision did not expressly contain any condition on
the matter of repurchase.
Both the RTC and the Court of Appeals (CA) agreed that MCIAA should reconvey to Inocian,
et al. The CA held that the decision in Civil Case No. R-1881 was conditional, since the expropriation
of the lots for the expansion of the Lahug Airport was ordered by the CFI of Cebu under the
impression that Lahug Airport would continue in operation. The condition was that should MCIAA,
or its precursor agency, discontinue with the operation of Lahug Airport, then the owners of the lots
expropriated may demand of MCIAA to make good its verbal assurance to allow the repurchase of
the properties. In the second petition for certiorari, Anunciacion Ouano, et al. asked MCIAA to be
allowed to exercise their right to repurchase but their request went unheeded. This prompted Ouano,
et al. to file a complaint before the RTC. In this case, the RTC and the CA dismissed the complaint.
ISSUE:
Whether or not Ouano, et al. are entitled to repurchase their properties.
RULING:
YES. MCIAA cannot really rightfully say that it has absolute title to the lots decreed
expropriated in Civil Case No. R-1881. The government acquires only such rights in expropriated
parcels of land as may be allowed by the character of its title over the properties. In light of our
disposition in Heirs of Moreno and Tudtud, the statement immediately adverted to means that in the
event the particular public use for which a parcel of land is expropriated is abandoned, the owner
shall not be entitled to recover or repurchase it as a matter of right, unless such recovery or
repurchase is expressed in or irresistibly deducible from the condemnation judgment. But as has
been determined below, the decision in Civil Case No. R-1881 enjoined MCIAA, as a condition of
approving expropriation, to allow recovery or repurchase upon abandonment of the Lahug airport
project. The return or repurchase of the condemned properties of petitioners could readily be
justified as the manifest legal effect of consequence of the trial courts underlying presumption
that Lahug Airport will continue to be in operation when it granted the complaint for eminent domain
and the airport discontinued its activities.
A condemnor should commit to use the property pursuant to the purpose stated in the
petition for expropriation, failing which it should file another petition for the new purpose. If not,
then it behooves the condemnor to return the said property to its private owner, if the latter so
desires. The government cannot plausibly keep the property it expropriated in any manner it pleases
and, in the process, dishonor the judgment of expropriation. This is not in keeping with the idea of
fair play,
HACIENDA LUISITA, INCORPORATED, et al. v. PRESIDENTIAL AGRARIAN REFORM COUNCIL, et

al.
G.R. No. 171101, 22 November 2011, EN BANC (Velasco, J.)
The option to remain in Hacienda Luisita Inc. (HLI) granted to the individual farmworker-
beneficiaries (FWBs) will have to be recalled and revoked. Moreover, bearing in mind that with the
revocation of the approval of the stock distribution plan (SDP), HLI will no longer be operating under
SDP and will only be treated as an ordinary private corporation; the FWBs who remain as stockholders
of HLI will be treated as ordinary stockholders and will no longer be under the protective mantle of
Republic Act No. 6657.
On July 22, 1987, Executive Order No. 229 (EO 229) was issued providing, as its title indicates,
the mechanisms for the Comprehensive Agrarian Reform Program (CARP) implementation. It
created the Presidential Agrarian Reform Council (PARC) as the highest policy-making body that
formulates all policies, rules, and regulations necessary for the implementation of CARP. On June 15,
1988, Republic Act No. 6657 (RA 6657) or the Comprehensive Agrarian Reform Law of 1988, also
known as CARL or the CARP Law, took effect, ushering in a new process of land classification,
acquisition, and distribution. In the case of Association of Small Landowners in the Philippines, Inc. v.
Secretary of Agrarian Reform, the Court upheld the constitutionality of the CARL.
At the core of the case is Hacienda Luisita de Tarlac (Hacienda Luisita), once a 6,443-hectare
mixed agricultural-industrial-residential expanse straddling several municipalities of Tarlac and
owned by Compañia General de Tabacos de Filipinas (Tabacalera). On May 7, 1980, the martial law
administration filed a suit before the Manila Regional Trial Court (RTC) against Tadeco, et al. for them
to surrender Hacienda Luisita to the then Ministry of Agrarian Reform (MAR, now the Department of
Agrarian Reform [DAR]) so that the land can be distributed to farmers at cost. Eventually, the Manila
RTC rendered judgment ordering Tadeco to surrender Hacienda Luisita to the MAR. Therefrom,
Tadeco appealed to the Court of Appeals (CA). On March 17, 1988, the Office of the Solicitor General
(OSG) moved to withdraw the government’s case against Tadeco, et al. By Resolution of May 18, 1988,
the CA dismissed the case the Marcos government initially instituted and won against Tadeco, et al.
The dismissal action was, however, made subject to the obtention by Tadeco of the PARC’s approval
of a stock distribution plan (SDP) that must initially be implemented after such approval shall have
been secured.
Markedly, Section 10 of EO 229 allows corporate landowners, as an alternative to the actual

land transfer scheme of CARP, to give qualified beneficiaries the right to purchase shares of stocks of
the corporation under a stock ownership arrangement and/or land-to-share ratio. Like EO 229, RA
6657, under the latter’s Sec. 31, also provides two (2) alternative modalities, i.e., land or stock
transfer, pursuant to either of which the corporate landowner can comply with CARP, but subject to
well-defined conditions and timeline requirements. From the start, the stock distribution scheme
appeared to be Tadeco’s preferred option, for, on August 23, 1988, it organized a spin-off corporation,
Hacienda Luisita, Incorporated (HLI), as vehicle to facilitate stock acquisition by the farmworkers.
For this purpose, Tadeco assigned and conveyed to HLI the agricultural land portion (4,915.75
hectares) and other farm-related properties of Hacienda Luisita in exchange for HLI shares of stock.
On August 15, 1995, HLI applied for the conversion of 500 hectares of land of the hacienda
from agricultural to industrial use. On December 13, 1996, HLI, in exchange for subscription of
12,000,000 shares of stocks of Centennary Holdings, Inc. (Centennary), ceded 300 hectares of the
converted area to the latter. Subsequently, Centennary sold the entire 300 hectares to Luisita
Industrial Park Corporation (LIPCO). Apart from the 500 hectares alluded to, another 80.51 hectares
were later detached from the area coverage of Hacienda Luisita which had been acquired by the
government as part of the Subic-Clark-Tarlac Expressway (SCTEX) complex. In absolute terms,
4,335.75 hectares remained of the original 4,915 hectares Tadeco ceded to HLI. On December 22,
2005, the PARC issued the assailed Resolution No. 2005-32-01. The resolution affirmed the
recommendation of the DAR to recall/revoke the SDO plan of Tadeco/HLI. It was resolved further
that the lands subject of the recalled/revoked TDC/HLI SDO plan be forthwith placed under the
compulsory coverage or mandated land acquisition scheme of the CARP. HLI sought reconsideration,
however it was denied by PARC in its Resolution No. 2006-34-01.
On July 5, 2011, this Court promulgated a Decision, denying the petition filed by HLI and
affirming PARC Resolution No. 2005-32-01 and PARC Resolution No. 2006-34-01, with the
modification that the original 6,296 qualified farmworker-beneficiaries of Hacienda Luisita (FWBs)
shall have the option to remain as stockholders of HLI. The Court however did not order outright land
distribution. The Court declared that the revocation of the SDP must, by application of the operative
fact principle, give way to the right of the original 6,296 qualified farmworkers-beneficiaries (FWBs)
to choose whether they want to remain as HLI stockholders or choose actual land distribution.
Hence, this motion for reconsideration filed by the parties.
ISSUES:
1. Whether or not the operative fact doctrine is applicable.

2. Whether or not Sec. 31 of RA 6657 is unconstitutional.
3. Whether or not the coverage of compulsory acquisition should be 6,443 hectares, and not just
4,915.75 hectares.
4. Whether or not the date of “taking” for purposes of determining just compensation is on
November 21, 1989.
5. Whether or not the 10-year prohibition on the transfer of awarded lands to third parties still
applies.
6. Whether or not the July 5, 2011 Decision that the qualified FWBs be given an option to remain
as stockholders of HLI be reconsidered.
RULING:
1. YES. The operative fact doctrine does not only apply to laws subsequently declared
unconstitutional or unlawful, as it also applies to executive acts subsequently declared as invalid.
Bearing in mind that PARC Resolution No. 89-12-210—an executive act—was declared invalid in the
instant case, the operative fact doctrine is clearly applicable. The application of the operative fact
doctrine to the FWBs is not iniquitous and prejudicial to their interests but is actually beneficial and
fair to them.
2. NO. The Court maintained that it is NOT compelled to rule on the constitutionality of Sec.
31 of RA 6657. In this regard, the Court clarified that the Court, in its July 5, 2011 Decision, made no
ruling in favor of the constitutionality of Sec. 31 of RA 6657. There was, however, a determination of
the existence of an apparent grave violation of the Constitution that may justify the resolution of the
issue of constitutionality, to which the Court ruled in the negative. Having clarified this matter, all
other points raised by both FARM and AMBALA concerning the constitutionality of RA 6657 deserve
scant consideration.
3. NO. Since what is put in issue before the Court is the propriety of the revocation of the SDP,
which only involves 4,915.75 has. of agricultural land and not 6,443 has., then the Court is
constrained to rule only as regards the 4,915.75 has. of agricultural land. Nonetheless, it should be
taken into account that this should not prevent the DAR, under its mandate under the agrarian reform
law, from subsequently subjecting to agrarian reform other agricultural lands originally held by
Tadeco that were allegedly not transferred to HLI but were supposedly covered by RA 6657.
In order to ensure the proper distribution of the agricultural lands of Hacienda Luisita per
qualified FWB, and considering that matters involving strictly the administrative implementation
and enforcement of agrarian reform laws are within the jurisdiction of the DAR, it is the latter which
shall determine the area with which each qualified FWB will be awarded. Since the 200-hectare lot
formed part of the SDP that was nullified by PARC Resolution 2005-32-01, the Court was constrained
to make a ruling on the rights of LRC over the said lot. Moreover, the 500-hectare portion of Hacienda
Luisita, of which the 200-hectare portion sold to LRC and the 300-hectare portion subsequently
acquired by LIPCO and RCBC were part of, was already the subject of the August 14, 1996 DAR
Conversion Order. By virtue of the said conversion order, the land was already reclassified as
industrial/commercial land not subject to compulsory coverage. The Court ruled in its July 5, 2011
Decision that since the Court excluded the 500-hectare lot subject of the August 14, 1996 Conversion
Order and the 80.51-hectare SCTEX lot acquired by the government from compulsory coverage, then
HLI and its subsidiary, Centennary, should be liable to the FWBs for the price received for said lots.
4. YES. In its July 5, 2011 Decision, the Court stated that “HLI shall be paid just compensation
for the remaining agricultural land that will be transferred to DAR for land distribution to the FWBs.”
We also ruled that the date of the “taking” is November 21, 1989, when PARC approved HLI’s SDP per
PARC Resolution No. 89-12-2. The Court maintained that the date of “taking” is November 21, 1989,
the date when PARC approved HLI’s SDP per PARC Resolution No. 89-12-2, in view of the fact that
this is the time that the FWBs were considered to own and possess the agricultural lands in Hacienda
Luisita. To be precise, these lands became subject of the agrarian reform coverage through the stock
distribution scheme only upon the approval of the SDP, that is, November 21, 1989. Thus, such
approval is akin to a notice of coverage ordinarily issued under compulsory acquisition.
5. YES. Without a doubt, under RA 6657 and DAO 1, the awarded lands may only be
transferred or conveyed after ten (10) years from the issuance and registration of the emancipation
patent (EP) or certificate of land ownership award (CLOA). Considering that the EPs or CLOAs have
not yet been issued to the qualified FWBs in the instant case, the 10-year prohibitive period has not
even started. Significantly, the reckoning point is the issuance of the EP or CLOA, and not the placing
of the agricultural lands under CARP coverage. Moreover, if the Court maintains the position that the
qualified FWBs should be immediately allowed the option to sell or convey the agricultural lands in
Hacienda Luisita, then all efforts at agrarian reform would be rendered nugatory by this Court, since,
at the end of the day, these lands will just be transferred to persons not entitled to land distribution
under CARP.
6. YES. The FWBs will never have control over these agricultural lands for as long as they
remain as stockholders of HLI. In line with the Court’s finding that control over agricultural lands
must always be in the hands of the farmers, the Court reconsidered its ruling that the qualified FWBs
should be given an option to remain as stockholders of HLI, inasmuch as these qualified FWBs will
never gain control given the present proportion of shareholdings in HLI.
A revisit of HLI’s Proposal for Stock Distribution under CARP and the Stock Distribution
Option Agreement (SDOA) upon which the proposal was based reveals that the total assets of HLI is
PhP 590,554,220, while the value of the 4,915.7466 hectares is PhP 196,630,000. Consequently, the
share of the farmer-beneficiaries in the HLI capital stock is 33.296% (196,630,000 divided by
590,554.220); 118,391,976.85 HLI shares represent 33.296%. Thus, even if all the holders of the
118,391,976.85 HLI shares unanimously vote to remain as HLI stockholders, which is unlikely,
control will never be placed in the hands of the farmer-beneficiaries. Control, of course, means the
majority of 50% plus at least one share of the common shares and other voting shares. Applying the
formula to the HLI stockholdings, the number of shares that will constitute the majority is
295,112,101 shares (590,554,220 divided by 2 plus one [1] HLI share). The 118,391,976.85 shares
subject to the SDP approved by PARC substantially fall short of the 295,112,101 shares needed by
the FWBs to acquire control over HLI. Hence, control can NEVER be attained by the FWBs. There is
even no assurance that 100% of the 118,391,976.85 shares issued to the FWBs will all be voted in
favor of staying in HLI, taking into account the previous referendum among the farmers where said
shares were not voted unanimously in favor of retaining the SDP. In light of the foregoing
consideration, the option to remain in HLI granted to the individual FWBs will have to be recalled
and revoked. Moreover, bearing in mind that with the revocation of the approval of the SDP, HLI will
no longer be operating under SDP and will only be treated as an ordinary private corporation; the
FWBs who remain as stockholders of HLI will be treated as ordinary stockholders and will no longer
be under the protective mantle of RA 6657.
REPUBLIC represented by the Department of Public Works and Highways (DPWH), v. SPS.
TAN SONG BOK and JOSEFINA S. TAN, et al.
G.R. No. 191448, 16 November 2011, THIRD DIVISION (Mendoza, J.)
Various factors come into play in the valuation of specific properties singled out for
expropriation. The values assigned by provincial assessors are usually uniform for very wide areas
covering several barrios or even an entire town with the exception of the poblacion. Individual
differences are never taken into account.
Eight (8) lots located in the Province of Pampanga owned by Spouses Tan Song Bok and
Josefina S. Tan (the Spouses) were among the properties expropriated by the Republic, through the
Department of Public Works and Highways (DPWH), for the North Luzon Expressway (NLE) Project.
The Republic filed an expropriation case before the Regional Trial Court, Branch 57, Angeles City
(RTC). A writ of possession was issued in favor of the Republic, and a Committee was created by the
RTC to determine the just compensation to be paid to affected landowners. The Committee rendered
its recommendation. In its decision, the RTC adopted the recommendation of the committee. The RTC
ordered the Republic to pay the Spouses P12,212,000.00; P59,735,850.00; P2,973,900.00; and
P51,750.00, respectively for the lots expropriated from them. Not in conformity with the RTC
decision, the Republic elevated the matter to the Court of Appeals (CA) anchored mainly on the
argument that the just compensation recommended by the committee was based on insufficient
evidence. The CA affirmed the RTC decision. The CA stated, among others, that the RTC did not rely
solely on the appraisal report submitted by the Committee but it also conducted hearings for the
purpose of receiving the parties’ evidence. Hence, this petition.
ISSUE:
Whether or not there was sufficient basis in arriving at the questioned amount of just
compensation.
RULING:
YES.The Court would like to stress that the Republic is silent on the undisputed fact that no
less than its witness, Cleofe Umlas, Administrative Officer of the Bureau of Internal Revenue, testified
and certified that the prevailing fair market value of land located at Pulung Maragul, Angeles City is
at P4,800.00/s.qm. as per CAR 00158912 dated August 1, 2001. She apparently based her testimony
and certification on the latest documents and deeds submitted to the Bureau of Internal Revenue
(BIR) Regional Office at that time. Obviously, her statement corroborated the findings of the
Committee. Hence, there was proper basis for the determination of the just compensation for the
expropriated properties.
The Republic’s tax declarations, the BIR zonal valuation and the deeds of sale it presented are
not the only proof of the fair value of properties. Zonal valuation is just one of the indices of the fair
market value of real estate. By itself, this index cannot be the sole basis of “just compensation” in
expropriation cases. Various factors come into play in the valuation of specific properties singled out
for expropriation. The values assigned by provincial assessors are usually uniform for very wide
areas covering several barrios or even an entire town with the exception of the poblacion. Individual
differences are never taken into account. The value of land is based on such generalities as its possible
cultivation for rice, corn, coconuts or other crops. Very often land described as ‘cogonal’ has been
cultivated for generations. Buildings are described in terms of only two or three classes of building
materials and estimates of areas are more often inaccurate than correct. Tax values can serve as
guides but cannot be absolute substitutes for just compensation.
IMPEACHMENT
MA. MERCEDITAS N. GUTIERREZ v. THE HOUSE OF REPRESENTATIVES COMMITTEE ON

JUSTICE, et al.
G.R. No. 193459, 15 February 2011, EN BANC (Carpio-Morales, J.)
It is not for Supreme Court to tell a co-equal branch of government how to promulgate when the
Constitution itself has not prescribed a specific method of promulgation. The Court is in no position to
dictate a mode of promulgation beyond the dictates of the Constitution.
The first impeachment complaint against Ma. Merceditas Gutierrez was filed by Risa
Hontiveros-Baraquel, Danilo Lim, and spouses Felipe and Evelyn Pestao. On August 3, 2010, Renato
Reyes, Jr., Mother Mary John Mananzan, Danilo Ramos, Edre Olalia, Ferdinand Gaite and James Terry
Ridon filed another impeachment complaint. On the same date, the House of
Representatives provisionally adopted the Rules of Procedure in Impeachment Proceedings of the
14th Congress. After hearing, House of Representatives Committee on Justice, found the two
complaints, which both allege culpable violation of the Constitution and betrayal of public trust,
sufficient in substance. The determination of the sufficiency of substance of the complaints by public
respondent, which assumed hypothetically the truth of their allegations, hinged on the issue of
whether valid judgment to impeach could be rendered thereon.
ISSUE/s:
1. Whether or not Gutierrez’s participation in the determination of the form and substance of
the complaints is indispensable.
2. Whether or not the court should look into the facts constitutive of the offenses vis-à-vis her
submission disclaiming the allegations in the complaints, as prayed for by Gutierrez.
3. Whether or not the delay in the publication of the Impeachment Rules constitutes violation
of Gutierrez’ right to due process.
4. Whether or not the One-year Bar Rule for initiating impeachment proceedings under Article
XI, Section 3, paragraph (5) of the Constitution begins to run from the filing of the first
impeachment complaint, as claimed by Gutierrez.
RULING:
1. NO. Rule III(A) of the Impeachment Rules of the 15th Congress reflects the impeachment
procedure at the Committee-level, particularly Section 5 which denotes that
Gutierrez’s initial participation in the impeachment proceedings the opportunity to file an Answer
starts after the Committee on Justice finds the complaint sufficient in form and substance. That the
Committee refused to accept Gutierrez’s motion for reconsideration from its finding of sufficiency of
form of the impeachment complaints is apposite, conformably with the Impeachment Rules.
Gutierrez further claims that public respondent failed to ascertain the sufficiency of form and
substance of the complaints on the basis of the standards set by the Constitution and its own
Impeachment Rules. The claim fails.
The determination of sufficiency of form and substance of an impeachment complaint is an

exponent of the express constitutional grant of rule-making powers of the House of Representatives
which committed such determinative function to public respondent. In the discharge of that power
and in the exercise of its discretion, the House has formulated determinable standards as to the form
and substance of an impeachment complaint. Prudential considerations behoove the Court to respect
the compliance by the House of its duty to effectively carry out the constitutional purpose, absent any
contravention of the minimum constitutional guidelines.
Contrary to Gutierrez’s position that the Impeachment Rules do not provide for
comprehensible standards in determining the sufficiency of form and substance, the Impeachment
Rules are clear in echoing the constitutional requirements and providing that there must be a verified
complaint or resolution, and that the substance requirement is met if there is a recital of facts
constituting the offense charged and determinative of the jurisdiction of the committee.
Notatu dignum is the fact that it is only in the Impeachment Rules where a determination of
sufficiency of form and substance of an impeachment complaint is made necessary. This requirement
is not explicitly found in the organic law, as Section 3(2), Article XI of the Constitution basically
merely requires a hearing. In the discharge of its constitutional duty, the House deemed that a finding
of sufficiency of form and substance in an impeachment complaint is vital to effectively carry out the
impeachment process, hence, such additional requirement in the Impeachment Rules.
2. NO. This issue would require the Court to make a determination of what constitutes an
impeachable offense. Such a determination is a purely political question which the Constitution has
left to the sound discretion of the legislature. Clearly, the issue calls upon this court to decide a non-
justiciable political question which is beyond the scope of its judicial power.
3. NO. Gutierrez contends that she was deprived of due process since the Impeachment Rules
was published only on September 2, 2010 a day after public respondent ruled on the sufficiency
of form of the complaints. She likewise tacks her contention on Section 3(8), Article XI of the
Constitution which directs that Congress shall promulgate its rules on impeachment to effectively
carry out the purpose of this section.
It is within the discretion of Congress to determine on how to promulgate its Impeachment

Rules, in much the same way that the Judiciary is permitted to determine that to promulgate a
decision means to deliver the decision to the clerk of court for filing and publication. It is not for this
Court to tell a co-equal branch of government how to promulgate when the Constitution itself has not
prescribed a specific method of promulgation. The Court is in no position to dictate a mode of
promulgation beyond the dictates of the Constitution. Publication in the Official Gazette or a
newspaper of general circulation is but one avenue for Congress to make known its rules. Had the
Constitution intended to have the Impeachment Rules published, it could have stated so as
categorically as it did in the case of the rules of procedure in legislative inquiries.
Even assuming arguendo that publication is required, lack of it does not nullify the
proceedings taken prior to the effectivity of the Impeachment Rules which faithfully comply with the
relevant self-executing provisions of the Constitution. Otherwise, in cases where impeachment
complaints are filed at the start of each Congress, the mandated periods under Section 3, Article XI of
the Constitution would already run or even lapse while awaiting the expiration of the 15-day period
of publication prior to the effectivity of the Impeachment Rules. In effect, the House would already
violate the Constitution for its inaction on the impeachment complaints pending the completion of
the publication requirement.
4. NO. The term initiate means to file the complaint and take initial action on it. The initiation
starts with the filing of the complaint which must be accompanied with an action to set the complaint
moving. It refers to the filing of the impeachment complaint coupled with Congress taking initial
action of said complaint. The initial action taken by the House on the complaint is the referral of the
complaint to the Committee on Justice.
In the present case, Gutierrez failed to establish grave abuse of discretion on the allegedly
belated referral of the first impeachment complaint filed by the Baraquel group. For while the said
complaint was filed on July 22, 2010, there was yet then no session in Congress. It was only four days
later or on July 26, 2010 that the 15th Congress opened from which date the 10-day session period
started to run. When, by Memorandum of August 2, 2010, Speaker Belmonte directed the Committee
on Rules to include the complaint in its Order of Business, it was well within the said 10-day session
period.
There is no evident point in rushing at closing the door the moment an impeachment
complaint is filed. Depriving the people (recall that impeachment is primarily for the protection of
the people as a body politic) of reasonable access to the limited political vent simply prolongs the
agony and frustrates the collective rage of an entire citizenry whose trust has been betrayed by an
impeachable officer. It shortchanges the promise of reasonable opportunity to remove an
impeachable officer through the mechanism enshrined in the Constitution.
But neither does the Court find merit in Baraquel, et al.’s alternative contention that the
initiation of the impeachment proceedings, which sets into motion the one-year bar, should include
or await, at the earliest, the Committee on Justice report. The proceeding is initiated or begins, when
a verified complaint is filed and referred to the Committee on Justice for action. This is the initiating
step which triggers the series of steps that follow.
JUDICIARY DEPARTMENT
ATTY. ELIAS OMAR A. SANA v. CAREER EXECUTIVE SERVICE BOARD

G.R. No. 192926, 15 November 2011, EN BANC (Carpio, J.)
For the Court to hear the case despite its mootness, the issues presented must be grounded on
peculiar set of facts giving rise to important constitutional questions capable of repetition yet evading
review or indicating intent on the part of potential or actual parties to place a constitutional question
beyond the ambit of judicial review by performing acts rendering moot an incipient or pending
justiciable controversy.
President Gloria Macapagal-Arroyo (President Arroyo) issued Executive Order (E.O.) No. 883
granting the rank of Career Executive Service Officer (CESO) III or higher to officers and employees
occupying legal positions in the government executive service who have obtained graduate degrees
in law and successfully passed the bar examinations. It also invoked the granting of a CESO rank to
“government personnel who successfully complete certain graduate programs, such as Masters in
Public Safety Administration (MPSA) and Masters in National Security Administration (MNSA) as
basis for the granting of CESO rank to government lawyers in the executive service. The Career
Executive Service Board (CESB) issued Resolution No. 870 finding no legal impediment for the
President to vest CESO rank to executive officials, notwithstanding the fact that it was done during
the period covered by the constitutional ban on midnight appointments. As such, President Arroyo
appointed 13 officials to varying CESO ranks. On 30 July 2010, President Benigno S. Aquino III
(President Aquino) issued E.O. No. 3 expressly revoking E.O. No. 883 and all other administrative
orders, proclamations, rules and regulations that conflict with it.
Subsequently, Atty. Elias Omar A. Sana (Sana) filed the present petition, contending that E.O.
No. 883 and the subsequent appointment of the 13 executive officials to CESO rank are void for
violating the constitutional ban on midnight appointment. CESB, on the other hand, prays for the
dismissal of Sana’s complaint, especially in consideration of E.O. No. 3, which renders the present
issue moot. Further, it contends that the appointment to a CESO rank is not equivalent to an
appointment to an office since the latter entails the conferment of an authority to exercise the
functions of an office whereas the former is merely a completion of a previous appointment.
ISSUE:
Whether E.O. No. 883 is constitutional.
RULING:
Considering that E.O. No. 3 expressly revoked E.O. No. 883, the Court found no reason to pass
upon the issuance’s validity. To do so would transgress the requirement of case and controversy as
precondition for the Court’s exercise of judicial review. While the Court had relaxed the case and
controversy requirement to resolve moot issues, in those instances, however, the issues presented
were grounded on peculiar set of facts giving rise to important constitutional questions capable of
repetition yet evading review or indicating intent on the part of potential or actual parties to place a
constitutional question beyond the ambit of judicial review by performing acts rendering moot an
incipient or pending justiciable controversy. In this case, such factors do not obtain, considering that
the question of whether an appointment to a CESO rank of an executive official amounts to an
“appointment” for purposes of the constitutional ban on midnight appointment, while potentially
recurring, holds no certainty of evading judicial review as the question can be decided even beyond
the appointments-ban period under Section 15, Article VII of the Constitution.
OFFICE OF THE DEPUTY OMBUDSMAN FOR LUZON, HONORABLE VICTOR C. FERNANDEZ, in

his capacity as Deputy Ombudsman for Luzon, and THE GENERAL INVESTIGATION BUREAU-
A, Represented by MARIA OLIVIA ELENA A. ROXAS v. JESUS D. FRANCISCO, SR.
G.R. No. 172553, 14 December 2011,
FIRST DIVISION, (Leonardo De Castro, J.)
Courts have refrained from even expressing an opinion in a case where the issues have become
moot and academic, there being no more justiciable controversy to speak of, so that a determination
thereof would be of no practical use or value.
Ligorio Naval (Naval) filed a complaint before the Office of the Ombudsman, accusing Jessie
Castillo (Castillo), the mayor of the Municipality of Bacoor, Cavite, of violating Anti-Graft and Corrupt
Practices Act, in relation to the award of the construction of the municipal building of Bacoor, Cavite,
worth more than 9 Million Pesos, to St. Marthas Trading and General Contractors. Naval alleged that
the latter was not qualified for the award; its license had expired at the time the contract was signed,
and was classified as belonging to Category C, hence, may only undertake projects worth 3 Million
Pesos or lower. The Ombudsman ruled that Naval’s allegation of lack of qualification of the contractor
has been satisfactorily controverted by Castillo and dismissed the complaint. Subsequently, Director
Joaquin F. Salazar of the Office of the Deputy Ombudsman for Luzon issued an Order preventively
suspending Jesus Francisco, Sr. (Francisco) and the other Prequalification, Bids and Awards
Committee (PBAC) members; the same was approved by Deputy Ombudsman for Luzon Victor C.
Fernandez. Consequently, Francisco filed before the Court of Appeals (CA) a Petition for Certiorari
with Application for Temporary Restraining Order and/or Writ of Preliminary Injunction. Francisco
argued that the Office of the Deputy Ombudsman for Luzon committed grave abuse of discretion
amounting to lack or excess of jurisdiction when it ordered his preventive suspension since the
transactions questioned in the case had already been passed upon Naval v. Castillo, which was
dismissed for lack of merit. CA rendered its assailed Decision, finding in favor of Francisco.
ISSUE:
Whether or not Francisco’s preventive suspension is proper
RULING:
NO. The Court finds that the petition at bar, which seeks the reinstatement of the Order of
preventive suspension the Office of the Deputy Ombudsman for Luzon, has been rendered moot. In
Ombudsman v. Pelio, the Court clarified that [p]reventive suspension is merely a preventive measure,
a preliminary step in an administrative investigation; the purpose thereof is to prevent the accused
from using his position and the powers and prerogatives of his office to influence potential witnesses
or tamper with records which may be vital in the prosecution of the case against him.
To recall in the instant case, the Order of the Office of the Deputy Ombudsman, which placed
Francisco et. al. under preventive suspension, was received by Francisco on July 1, 2005. Instead of
filing a motion for reconsideration thereon, Francisco filed before the CA a Petition for Certiorari with
Application for Temporary Restraining Order and/or Writ of Preliminary Injunction. The appellate
court, however, did not issue a temporary restraining order or a preliminary injunction. Accordingly,
the six-month period of the preventive suspension was not interrupted. Having received notice of the
Order on July 1, 2005, the period of suspension lapsed on December 28, 2005. Of greater importance,
however, is the fact that Administrative Case No. OMB-C-A-05-0032-A was already terminated by the
Office of the Deputy Ombudsman when it dismissed the case in a Joint Resolution. Consequently, the
Order of the Office of the Deputy Ombudsman placing Francisco and his co-respondents under
preventive suspension has already lost its significance.
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, et al. v. CONCERNED RESIDENTS OF
MANILA BAY
G.R. Nos. 171947-48, 15 February 2011, EN BANC (Velasco, Jr., J.)
The issuance of subsequent resolutions by the Court is simply an exercise of judicial power under
Art. VIII of the Constitution, because the execution of the Decision is but an integral part of the
adjudicative function of the Court.
Pursuant to the decision of the Supreme Court (SC) on December 18, 2008, the Manila Bay
Advisory Committee was created to monitor and receive reports as to the progress on the activities
being done by the agencies in accordance with the SC’s decision. The Committee recommended that
specific time frames be set within which the agencies are obliged to perform their tasks. The
Metropolitan Manila Development Authority (MMDA), et al. assail that the requirements demanded
of them are considered as an encroachment of the powers of the Executive branch of the government.
ISSUE:
Whether or not the Court’s act in requiring the agencies concerned to submit reports and
follow with specific time frames within which to comply with the directives of the SC is an
encroachment of the powers and duties of the Executive Branch of the government.
RULING:
NO. The issuance of subsequent resolutions by the Court is simply an exercise of judicial
power under Art. VIII of the Constitution, because the execution of the Decision is but an integral part
of the adjudicative function of the Court. None of the agencies ever questioned the power of the Court
to implement the December 18, 2008 Decision nor has any of them raised the alleged encroachment
by the Court over executive functions.
While additional activities are required of the agencies like submission of plans of action, data
or status reports, these directives are but part and parcel of the execution stage of a final decision
under Rule 39 of the Rules of Court. It is clear that the final judgment includes not only what appears
upon its face to have been so adjudged but also those matters actually and necessarily included
therein or necessary thereto. Certainly, any activity that is needed to fully implement a final judgment
is necessarily encompassed by said judgment.
Moreover, the submission of periodic reports is sanctioned by Secs. 7 and 8, Rule 8 of the
Rules of Procedure for Environmental cases:
“Sec. 7. Judgment. If warranted, the court shall grant the privilege of the writ of
continuing mandamus requiring respondent to perform an act or series of acts until
the judgment is fully satisfied and to grant such other reliefs as may be warranted
resulting from the wrongful or illegal acts of the respondent. The court shall require
the respondent to submit periodic reports detailing the progress and execution
of the judgment, and the court may, by itself or through a commissioner or the
appropriate government agency, evaluate and monitor compliance. The
petitioner may submit its comments or observations on the execution of the
judgment.”
With the final and executory judgment in MMDA, the writ of continuing mandamus issued
in MMDA means that until petitioner-agencies have shown full compliance with the Courts orders,
the Court exercises continuing jurisdiction over them until full execution of the judgment.
HACIENDA LUISITA INCORPORATED v. PRESIDENTIAL AGRARIAN REFORM COUNCIL;

SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN REFORM;
ALYANSA NG MGA MANGGAGAWANG BUKIND NG HACIENDA LUISITA, RENE GALANG, NOEL
MALLARI, AND JULIO SUNIGA AND HIS SUPERVISORY GROUP OF THE HACIENDA LUISITA,
INC. AND WINDSOR ANDAYA
G.R. No. 171101, July 5, 2011, EN BANC (Velasco, Jr., J.)
When the Court is called upon to exercise its power of judicial review over, and pass upon the
constitutionality of, acts of the executive or legislative departments, it does so only when the following
essential requirements are first met, to wit: (1) there is an actual case or controversy; (2) that the
constitutional question is raised at the earliest possible opportunity by a proper party or one with locus
standi; and (3) the issue of constitutionality must be the very lis mota of the case.
Hacienda Luisita de Tarlac (Hacienda Luisita) was sold by the Spanish owners of the
Tabaclaera to the Central Azucarera de Tarlac (CAT). The Tarlac Development Corporation (Tadeco),
then owned by Jose Cojuangco, Sr. Group (Cojuangco Group), was willing to buy. Tadeco undertook
to pay the purchase price in pesos, while that for the controlling interest in CAT, in US dollars. Tadeco
had fully paid the purchase price for the acquisition of Hacienda Luisita and Tabacalera’s interest in
CAT. The martial law administration filed a suit before the Regional Trial Court (RTC) against
Tadeco, et al., for them to surrender Hacienda Luisita to the then Ministry of Agrarian Reform (MAR,
now the Department of Agrarian Reform [DAR]) so that the land can be distributed to farmers at cost.
Responding, Tadeco or its owners alleged that Hacienda Luisita does not have tenants, besides which
sugar lands of which the hacienda consisted are not covered by existing agrarian reform legislations.
As perceived then, the government commenced the case against Tadeco.
The RTC ruled in favor of MAR. The appeal of Tadeco before the Court of Appeals (CA) was
dismissed but made subject to the obtention by the Tadeco of the PARC’s approval of a stock
distribution plan (SDP) that must be inititally be implemented after such approval shall have been
secured. Sec. 31 of Republic Act No. 6657 or the Comprehensive Agrarian Reform Program (CARP)
Law provides two (2) alternative modalities, i.e., land or stock transfer, pursuant to either of which
the corporate landowner can comply with CARP, but subject to well-defined conditions and timeline
requirements.
From the start, the stock distribution scheme appeared to be Tadeco’s preferred option, for it
organized a spin-off corporation, Hacienda Luisita Incorporated (HLI), as vehicle to facilitate stock
acquisition by the farmworkers. For this purpose, Tadeco assigned and conveyed to HLI the
agricultural land portion and other farm-related properties of Hacienda Luisita in exchange for HLI
shares of stock.
To accommodate the assets transfer from Tadeco to HLI, the latter, with the Securities and
Exchange Commission’s (SEC’s) approval, increased its capital stock divided into shares which were
to be issued only to qualified and registered beneficiaries of the CARP, and the remaining to any
stockholder of the corporation. Some of the then farmworker-beneficiaries (FWBs) complement of
Hacienda Luisita signified in a referendum their acceptance of the proposed HLI’s Stock Distribution
Option Plan. The Stock Distribution Option Agreement (SDOA), styled as a Memorandum of
Agreement (MOA), was entered into by Tadeco, HLI, and the qualified FWBs and attested to by then
DAR Secretary Philip Juico. The SDOA embodied the basis and mechanics of the SDP, which would
eventually be submitted to the PARC for approval. The he production-sharing, as the SDP indicated,
is payable irrespective of whether HLI makes money or not, implying that the benefits do not partake
the nature of dividends. In a follow-up referendum the DAR conducted, the FWBs opted to receive
shares in HLI. When the SDP was approved, two separate groups subsequently contested this claim
of HLI. HLI then applied for the conversion of 500 hectares of land of the hacienda from agricultural
to industrial use. Per DAR Conversion Order, the application was granted subject to payment of three
percent (3%) of the gross selling price to the FWBs and to HLIs continued compliance with its
undertakings under the SDP, among other conditions.
Now, the Supervisory Group of HLI sought to revoke the SDOA, alleging that HLI had failed to
give them their dividends and their share in gross sales, as well as the share in the proceeds of the
sale of the converted 500 hectares of land. The DAR then constituted a Special Task Force to attend
to the issues. After investigation it was found out that HLI has not complied with its obligations under
RA 6657 despite implementation of the SDP. The DAR then recommended for the revocation of the
SDO plan of Tadeco, which was adopted by the Presidential Agrarian Reform Council (PARC). Now,
FARM asks for the invalidation of Sec. 31, RA 6657 insofar as it affords the corporation, as a mode of
CARP compliance, to resort to stock distribution, an arrangement which, to FARM, impairs the
fundamental right of farmers and farmworkers under Sec. 4, Art. XIII of the Constitution. However,
HLI insists that agrarian reform is not only about transfer of land ownership to farmers and other
qualified beneficiaries. It draws attention in this regard to Sec. 3(a) of RA 6657 on the concept and
scope of the term agrarian reform. The constitutionality of a law, HLI added, cannot, as here, be
attacked collaterally.
ISSUE:
Whether or not the Supreme Court may exercise its power of judicial review over the
constitutionality of Sec. 31 of RA 6657.
RULING:
NO. When the Court is called upon to exercise its power of judicial review over, and pass upon
the constitutionality of, acts of the executive or legislative departments, it does so only when the
following essential requirements are first met, to wit: (1) there is an actual case or controversy;
(2) that the constitutional question is raised at the earliest possible opportunity by a proper party or
one with locus standi; and (3) the issue of constitutionality must be the very lis mota of the case.
Not all the foregoing requirements are satisfied in the case at bar. While there is indeed an
actual case or controversy, intervenor FARM, composed of a small minority of 27 farmers, has yet to
explain its failure to challenge the constitutionality of Sec. 3l of RA 6657, since when PARC approved
the SDP of Hacienda Luisita or at least within a reasonable time thereafter and why its members
received benefits from the SDP without so much of a protest. It was only 14 years after approval of
the SDP via PARC Resolution that said plan and approving resolution were sought to be revoked, but
not, to stress, by FARM or any of its members, but by AMBALA. Furthermore, the AMBALA petition
did not question the constitutionality of Sec. 31 of RA 6657, but concentrated on the purported flaws
and gaps in the subsequent implementation of the SDP. Even the public respondents, as represented
by the Solicitor General, did not question the constitutionality of the provision. On the other hand,
FARM, whose 27 members formerly belonged to AMBALA, raised the constitutionality of Sec. 31 only
when it filed its Supplemental Comment with the Court. Thus, it took FARM some eighteen (18) years
before it challenged the constitutionality of Sec. 31 of RA 6657 which is quite too late in the day. The
FARM members slept on their rights and even accepted benefits from the SDP with nary a complaint
on the alleged unconstitutionality of Sec. 31 upon which the benefits were derived. The Court cannot
now be goaded into resolving a constitutional issue that FARM failed to assail after the lapse of a long
period of time and the occurrence of numerous events and activities which resulted from the
application of an alleged unconstitutional legal provision.
It has been emphasized in a number of cases that the question of constitutionality will not be
passed upon by the Court unless it is properly raised and presented in an appropriate case at the first
opportunity. FARM is, therefore, remiss in belatedly questioning the constitutionality of Sec. 31 of RA
6657. The second requirement that the constitutional question should be raised at the earliest
possible opportunity is clearly wanting.
The last but the most important requisite that the constitutional issue must be the very lis
mota of the case does not likewise obtain. The lis mota aspect is not present, the constitutional issue
tendered not being critical to the resolution of the case. The unyielding rule has been to avoid,
whenever plausible, an issue assailing the constitutionality of a statute or governmental act. If some
other grounds exist by which judgment can be made without touching the constitutionality of a law,
such recourse is favored.
The lis mota in this case, proceeding from the basic positions originally taken by AMBALA (to
which the FARM members previously belonged) and the Supervisory Group, is the alleged non-
compliance by HLI with the conditions of the SDP to support a plea for its revocation. And before the
Court, the lis mota is whether or not PARC acted in grave abuse of discretion when it ordered the
recall of the SDP for such non-compliance and the fact that the SDP, as couched and implemented,
offends certain constitutional and statutory provisions. To be sure, any of these key issues may be
resolved without plunging into the constitutionality of Sec. 31 of RA 6657. Moreover, looking deeply
into the underlying petitions of AMBALA, et al., it is not the said section per se that is invalid, but
rather it is the alleged application of the said provision in the SDP that is flawed.
BILL OF RIGHTS
Ex Post Facto and Bill of Attainder
BUREAU OF CUSTOMS EMPLOYEES ASSOCIATION (BOCEA) v. MARGARITO B. TEVES, et al.,

G.R. No. 181704, 06 December 2011, EN BANC (Villarama, Jr., J.)
A bill of attainder is a legislative act which inflicts punishment on individuals or members of a

particular group without a judicial trial. R.A. No. 9335 does not possess the elements of a bill of
attainder. It does not seek to inflict punishment without a judicial trial. R.A. No. 9335 merely lays down
the grounds for the termination of a BIR or BOC official or employee and provides for the consequences
thereof. The democratic processes are still followed and the constitutional rights of the concerned
employee are amply protected.
President Gloria Macapagal-Arroyo signed into law R.A. No. 9335, otherwise known as the
Attrition Act of 2005. It was enacted to optimize the revenue-generation capability and collection of
the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC). The law intends to encourage
BIR and BOC officials and employees to exceed their revenue targets by providing a system of
rewards and sanctions through the creation of a Rewards and Incentives Fund and a Revenue
Performance Evaluation Board. The Implementing Rules and Regulations (IRR) of the Act was
approved and became effective in 2006. The Bureau of Customs Employees Association (BOCEA), an
association of rank-and-file employees of the BOC, assail the constitutionality of R.A. No. 9335 and its
IRR alleging that it is in violation of the fundamental rights of its members. BOCEA aver, among
others, that R.A. No. 9335 is a bill of attainder because it inflicts punishment upon a particular group
or class of officials and employees without trial. This is evident from the fact that the law confers
upon the Board the power to impose the penalty of removal upon employees who do not meet their
revenue targets; that the same is without the benefit of hearing; and that the removal from service is
immediately executory.
ISSUE:
Whether or not R.A. No. 9335 is a bill of attainder.
RULING:
NO. R.A. No. 9335 and its IRR are constitutional. A bill of attainder is a legislative act which
inflicts punishment on individuals or members of a particular group without a judicial trial. Essential
to a bill of attainder are a specification of certain individuals or a group of individuals, the imposition
of a punishment, penal or otherwise, and the lack of judicial trial. R.A. No. 9335 does not possess the
elements of a bill of attainder. It does not seek to inflict punishment without a judicial trial. R.A. No.
9335 merely lays down the grounds for the termination of a BIR or BOC official or employee and
provides for the consequences thereof. The democratic processes are still followed and the
constitutional rights of the concerned employee are amply protected. It must be noted that this is not
the first time the constitutionality of R.A. No. 9335 and its IRR are being challenged. The Court already
settled the majority of the same issues raised by BOCEA in its decision in Abakada Guro Party List v.
Purisima (G.R. No. 166715, August 14, 2008), which attained finality on September 17, 2008.
Search and Seizure
ELENITA C. FAJARDO v. PEOPLE OF THE PHILIPPINES

G.R. No. 190889, 10 January 2011, SECOND DIVISION, (Nachura, J)
In plain view doctrine, the law merely requires that the law enforcer observes that the seized
item may be evidence of a crime, contraband, or otherwise subject to seizure.
A search warrant was issued to recover and confiscate two receivers of caliber .45 pistol,
Model no. M1911A1 US with SN 763025 and Model no. M1911A1 US with defaced serial number, two
pieces short magazine of M16 Armalite rifle, thirty-five pieces live M16 ammunition 5.56 caliber and
fourteen pieces live caliber .45 ammunition from Elenita Fajardo, and Zaldy Valerio. Since petitioner
and Valerio failed to present any documents showing their authority to possess the confiscated
firearms and the two recovered receivers, they were charged with violation of P.D. No. 1866. The
Regional Trial Court found Fajardo and Valerio guilty as charged. It denied the Motion to Quash Search
Warrant and Demurrer to Evidence. The RTC also ruled that petitioner and Valerio were estopped
from assailing the legality of their arrest since they participated in the trial by presenting evidence
for their defense. Likewise, by applying for bail, they have effectively waived such irregularities and
defects.
On appeal, the Court of Appeals concurred with the factual findings of the RTC, but disagreed
with its conclusions of law, and held that the search warrant was void. Resultantly, all firearms and
explosives seized inside Fajardo’s residence were declared inadmissible in evidence. However, the 2
receivers recovered by the policemen outside the house of Fajardobefore the warrant was served
were admitted as evidence, pursuant to the plain view doctrine.
ISSUES:
1. Whether or not the discovery of the two receivers come within the purview of the plain view
doctrine
2. Whether or not Fajardo is guilty of illegal possession of firearm
RULING:
1. YES. The receivers are admissible for being seized under the plain view doctrine. Under
the plain view doctrine, objects falling in the plain view of an officer, who has a right to be in the
position to have that view, are subject to seizure and may be presented as evidence. The law
enforcement officer must lawfully make an initial intrusion or properly be in a position from which
he can particularly view the area. In the course of such lawful intrusion, he came inadvertently across
a piece of evidence incriminating the accused. The object must be open to eye and hand, and its
discovery inadvertent.
The presence of police officers at the back of the house around the premises was justified by
the fact that Fajardo and Valerio were earlier seen respectively holding .45 caliber pistols before they
ran inside the structure and sought refuge. The ensuing recovery of the receivers may have been
deliberate; nonetheless, their initial discovery was indubitably inadvertent. It is not crucial that at
initial sighting the seized contraband be identified and known to be so. The law merely requires that
the law enforcer observes that the seized item may be evidence of a crime, contraband, or otherwise
subject to seizure.
2. NO. Fajardo was neither in physical nor constructive possession of the subject receivers.
The testimony of SPO2 Nava clearly bared that he only saw Valerio on top of the house when the
receivers were thrown. None of the witnesses saw Fajardo holding the receivers, before or during
their disposal. At the very least, Fajardo’s possession of the receivers was merely incidental because
Valerio, the one in actual physical possession, was seen at the rooftop of Fajardo’s house. Mere
speculations and probabilities cannot substitute for proof required to establish the guilt of an accused
beyond reasonable doubt.
PEOPLE OF THE PHILIPPINES v. ROLANDO S. DELOS REYES, alias Botong AND RAYMUNDO G.
REYES, alias Mac-Mac
G.R. No. 174774, 31 August 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Search incidental to a lawful arrest includes a valid warrantless search and seizure pursuant to
an equally valid warrantless arrest must precede the search. The law requires that there be first a lawful
arrest before a search can be made the process cannot be reversed.
Rolando “Botong” Delos Reyes and Raymundo “Mac-Mac” Reyes, Emmanuel de Claro, and
Mary Jane Lantion-Tom were all arrested for illegal possession, sale, delivery, distribution, and/or
transportation of Methamphetamine Hydrochloride, a regulated drug, also known as shabu. The
Regional Trial Court (RTC) found Botong and Mac-Mac and Emmanuel de Claro guilty beyond
reasonable doubt of the crime charged. But the RTC subsequently reversed its decision and acquitted
de Claro. The Court of Appeals (CA) sustained the conviction of Botong and Mac-Mac. According to
the CA, the police officers testimonies deserve credence than Botong and Mac-Mac’s defenses of
denial and alibi, there being no evidence to rebut the presumption that the police officers regularly
performed their official duties.
Botong and Mac-Mac additionally argued that the prosecution’s version of the arrests of the
suspects and seizure of the shabu shows that the same were effected in violation of Botong and Mac-
Mac’s fundamental rights. The arrests were executed without any warrant or any of the exceptional
circumstances to justify a warrantless arrest. The suspects were arrested without warrants based on
a mere tip from a confidential informant and not because of any apparent criminal activity. They
argued that a tip does not constitute probable cause for a warrantless arrest or search and seizure
incidental thereto. Therefore, the shabu allegedly seized is inadmissible in evidence.
ISSUE:
Whether or not Botong and Mac-Mac’s constitutional right provided for in Section 2, Article
III and Section 3, paragraph 2 of Article III of the Constitution were violated.
RULING:
YES. The prosecution failed to establish probable cause to justify the in flagrante
delicto arrests of Botong and Mac-Mac and search of their persons, incidental to their arrests,
resulting in the seizure of the shabu in accused-appellants possession. The exclusionary rule
enshrined in Section 3, paragraph 2 of Article III of the Constitution, which solidifies the protection
against unreasonable searches and seizures, thus: “(2) Any evidence obtained in violation of this or
the preceding section shall be inadmissible for any purpose in any proceeding.” The foregoing
constitutional proscription is not without exceptions. The first exception (search incidental to a
lawful arrest) includes a valid warrantless search and seizure pursuant to an equally valid
warrantless arrest which must precede the search. In this instance, the law requires that there be
first a lawful arrest before a search can be made the process cannot be reversed.
The police officers arrested Botong and Mac-Mac and searched the latter’s persons without a
warrant after seeing Botong and Emmanuel de Claro momentarily conversing in the restaurant, and
witnessing the white plastic bag with a box or carton inside being passed from Lantion-Tom to
Emmanuel de Claro, to Botong, and finally, to Mac-Mac. These circumstances, however, hardly
constitute overt acts indicative of a felonious enterprise. SPO1 Lectura, PO3 Santiago, and PO3 Yumul
had no prior knowledge of the suspects’ identities, and they completely relied on their confidential
informant to actually identify the suspects. None of the police officers actually saw what was inside
that box. There is also no evidence that the confidential informant himself knew that the box
contained shabu. No effort at all was taken to confirm that the arrested suspects actually knew that
the box or carton inside the white plastic bag, seized from their possession, contained shabu. The
police officers were unable to establish a cogent fact or circumstance that would have reasonably
invited their attention, as officers of the law, to suspect that Botong, Mac-Mac, Emmanuel de Claro,
and Lantion-Tom has just committed, is actually committing, or is attempting to commit a crime,
particularly, an illegal drug deal.
PEOPLE OF THE PHILIPPINES v. ERNESTO UYBOCO y RAMOS

G.R. No. 178039, 19 January 2011, FIRST DIVISION (Perez, J.)
A valid hot pursuit arrest necessitates two stringent requirements before a warrantless arrest
can be effected: (1) an offense has just been committed; and (2) the person making the arrest has
personal knowledge of facts indicating that the person to be arrested has committed it.
Nimfa Celiz (Celiz) and her wards, siblings Jeson Kevin and Jeson Kirby Dichaves, were taken
and brought to a house in Merville Subdivision, Paranaque. The kidnappers called Jepson Dichaves
(Jepson), the Nimfa's employer and the parent of the siblings, and asked for ransom in exchange for
the release of the captives. Both Celiz and Jepson were able to recognize the voice of the kidnapper,
as he had several business transactions with Jepson and they have talked several times over the past
four years. When they finally agreed to the ransom amount, Ernesto Uyboco (Uyboco), the captor,
asked Jepson to bring the ransom alone at Pancake House in Magallanes Commerical Center. After
receiving the information, Jespon informed General Jewel Canson (Gen. Canson) and General Panfilo
Lacson (Gen. Lacson), and the two coordinated with the other police officers regarding the capture
of Uyboco. They assigned one group of police officers at the meeting place and one group of officers
at Fort Bonifacio, where Uyboco was expected to pass.
Uyboco arrived at the meeting place aboard a red Nissan vehicle. Two police officers were
assigned at the Magallanes Commerical Center to capture the pay-off on camera and video. Once
Uyboco got the bag with the ransom money from Jepson’s trunk, the former informed him where he
could find Celiz and his sons, before heading off. The police officers assigned to apprehend Uyboco
were informed that the red vehicle he was boarding was headed their way, and so they followed and
blocked the vehicle. They introduced themselves as police officers and accosted Uyboco. Afterwards,
Uyboco was charged with three counts of kidnapping with ransom. The Regional Trial Court (RTC)
and the Court of Appeals (CA) both found him guilty beyond reasonable doubt of the crime charged.
ISSUE:
Whether Uyboco’s warrantless arrest was valid.
RULING:
YES. For a valid hot pursuit arrest, under Sec. 5 of Rule 113 of the Rules of Court, there are
two stringent requirements that must be met: (1) an offense has just been committed; and (2) the
person making the arrest has personal knowledge of facts indicating that the person to be arrested
has committed it. In this case, the records show that both requirements are present in this case. The
police officers present in Magallanes Commercial Center were able to witness the pay-off which
effectively consummates the crime of kidnapping. They all saw Uyboco take the money from the car
trunk of Jepson. Such knowledge was then relayed to the other police officers stationed in Fort
Bonifacio where Uyboco was expected to pass by. For the second requisite, it is sufficient for the
arresting team that they were monitoring the pay-off for a number of hours long enough for them to
be informed that it was indeed Uyboco, who was the kidnapper. This is equivalent to personal
knowledge based on probable cause, because the Rules on Criminal Procedure does not require the
arresting officers to personally witness the commission of the offense with their own eyes.
Due Process
PHILIPPINE AMUSEMENT AND GAMING CORPORATION v. COURT OF APPEALS and MIA

MANAHAN
G.R. No. 185668, 13 December 2011, EN BANC (REYES, J.)
For a valid dismissal from the government service, CSC Resolution No. 99-1936 entitled Uniform
Rules on Administrative Cases in the Civil Service, particularly Section 16 thereof on the requirement of
a formal charge in investigations, must be complied.
Mia Manahan (Manahan) was a Treasury Officer of Philippine Amusement and Gaming
Corporation (PAGCOR) assigned in Casino Filipino-Manila Pavilion (CF-Pavilion). Among her
functions as Treasury Officer was the handling of fund transfer requests received by CF-Pavilion and
the supervision of the office's Vault-in-Charge and Senior Cashier. Manahan received from the fax
machine of CF-Pavilion's SVIP-Treasury a document that appeared to be a Request for Fund Transfer
from Casino Filipino-Laoag (CF-Laoag) for P4,200,000.00 to be released by CF-Pavilion to Arnulfo
Fuentabella or David Fuentabella. A person who represented himself to be David Fuentabella claimed
the amount. However, CF-Laoag's Vault-in-Charge Norman Santiago and Treasury Head Joselito
Ricafort denied that such fund transfer had been made by CF-Laoag to CF-Pavilion. Manahan then
received a A notice of preventive suspension informing her that she was charged of Serious
Procedural Deviation/Gross Negligence. Manahan was instructed to report to the Corporate Office of
PAGCOR where she was again questioned regarding the fund transfer incident. Manahan filed a
written statement giving her account of the events that transpired in relation to the disputed fund
transfer. The Statement was filed in lieu of her oral testimony, after she was allegedly not allowed to
be assisted by counsel during the meeting and instead granted her the option to submit a written
statement. Manahan finally received from PAGCOR's Human Resource Department (HRD) Senior
Managing Head a letter informing her of the PAGCOR Board of Directors' (BOD) decision to dismiss
her from the service.
On appeal to CSC, Manahan claimed that she was deprived of her constitutional right to due
process of law when the PAGCOR BOD outrightly dismissed her from service without informing her
of the formal charges and apprising her of the documentary evidence against her. After a finding of
violation of Manahan's right to due process, the Commission remanded the case to PAGCOR for the
issuance of a formal charge, if warranted, then a formal investigation pursuant to the Uniform Rules
on Administrative Cases in the Civil Service. Further, the CSC noted that the order of dismissal served
upon Manahan was a mere notice issued by the HRD Senior Managing Head informing her of the
PAGCOR BOD's decision to dismiss her from the service, instead of a copy of the BOD Resolution on
the order of dismissal. The CA affirmed. PAGCOR, claiming that there was observance of due process,
filed the present Petition for Certiorari under Rule 65.
ISSUE:
Whether there was violation of the right to due process.
RULING:
YES. CSC Resolution No. 99-1936 entitled Uniform Rules on Administrative Cases in the Civil
Service, particularly Section 16 thereof on the requirement of a formal charge in investigations, was
not complied. What PAGCOR claims to be the formal charge it issued in compliance with the CSC rules
was the memorandum addressed to Manahan under the subject Preventive Suspension, which was
issued by CF-Pavilion's Senior Branch Manager only. However, a Senior Branch Manager is not among
the company's disciplining authority, he or she being merely charged with the duty, among others, to
recommend disciplinary sanctions for violations of house rules and company policies and
procedures. Without proper investigation and, thereafter, a decision that clearly indicated the facts
constituting the offense imputed upon Manahan and the company rules she supposedly violated,
Manahan did not get the chance to sufficiently defend herself.
ROSEMARIE SALMA ARAGONCILLO-MOLOK V. SITY AISA BARANGAI MOLOK

G.R. No. 169627, 6 April 2011, THIRD DIVISION (Carpio-Morales, J.)
When the trial court ignored petitioner’s plea that she be furnished with a copy of respondent’s
petition and its annexes so that she could file her opposition thereto, petitioner was denied her day in
court.
Sity Aisa Barangai Molok (Sity) and Col. Agakhan M. Molok (Agakhan), contracted marriage in
1992. In 2003, Agakhan, then a member of the Philippine Army, died in General Santos City. When
Sity went to the Philippine Army office to claim the death benefits of her late husband, she discovered
that there was another claimant, Rosemarie Salma Aragoncillo-Molok (Rosemarie), who declared
herself as the wife of Agakhan. The marriage, which was purportedly solemnized under Muslim rites,
was registered before the Shari’a District Court Muslim Civil Registrar of Zamboanga City under
Registry No. 25901. Upon inquiry, Sity found out that there was no record of the second marriage.
Thus, Sity filed a petition for cancellation of registration of the alleged marriage before the Third
Shari’a District Court of Zamboanga City. The trial court set the hearing of the petition and ordered
all persons who oppose it to appear and show cause why the petition shall not be granted. Rosemarie
sent a letter addressed to the Clerk of Court, Shari’a District Court, Zamboanga City, wherein
she manifested her opposition to the grant of respondent’s petition. She later filed a Manifestation
alleging that she has not received any copy of the petition and the summons requiring her to submit
an Answer thereto and unless she is furnished with the copy of the petition and its exhibits,
respondent could not file a responsive pleading in accordance with the Rules.
The trial court, however, did not act on Rosemarie’s Manifestation. During the scheduled
hearing of the petition, only Sity and her counsel appeared. The trial court found for Sity. It noted that
Rosemarie has not filed any formal opposition to petitioner’s petition. Rosemarie filed a motion for
reconsideration which the trial court set for hearing on September 1, 2005. No hearing was held on
that date, however, as it was a non-working Muslim holiday. The clerk of the trial court then advised
her to wait for a notice of resetting of the hearing. However, no notice of resetting was issued. It
turned out that Rosemarie’s motion was denied by Order of July 25, 2005 or before the originally
scheduled hearing thereof on September 1, 2005. Rosemarie then filed a petition for review on
certiorari, contending that, among other things, the trial court, in rendering its decision solely on the
basis of respondent’s petition, violated her constitutional right to due process.
ISSUE:
Whether Rosemarie’s constitutional right to due process was violated
RULING:
YES. Petitioner was merely notified of the hearing of respondent’s petition on March 28, 2005
by Order of January 24, 2005. Neither respondent nor the trial court furnished petitioner with a copy
of respondent’s petition and its annexes, despite her plea therefor.
Indeed, when the trial court ignored her plea, through her "Manifestation (With prayer for
reconsideration of the January 2[4], 2005 Order)" dated March 16, 2005, that she be furnished with
a copy of respondent’s petition and its annexes so that she could file her opposition thereto,
petitioner was denied her day in court. Why petitioner’s plea was unheeded, no reason was proffered
by the trial court. It need not be underlined that her plea was meritorious, given the adversarial
nature of the proceedings under Rule 108. In raising the issue of denial of due process in petitioner’s
motion for reconsideration of the decision, the trial court, by Order of July 25, 2005, did not
specifically address the same. Oddly, said Order was issued on July 25, 2005, when petitioner’s
motion for reconsideration was set for hearing yet on September 1, 2005, albeit no hearing was held
since; as stated earlier, it was a non-working Muslim holiday, and despite the Clerk of Court’s
assurance that petitioner would be advised of the date of resetting of the hearing.
Right to Information
RE: PETITION FOR RADIO AND TELEVISION COVERAGE OF THE MULTIPLE MURDER CASES
AGAINST MAGUINDANAO GOVERNOR ZALDY AMPATUAN, et al.,
A.M. Nos. 10-11-5-SC, 10-11-6-SC, and 10-11-7-SC, 14 June 2011, EN BANC (Carpio-Morales, J.)
Technology tends to provide the only solution to break the inherent limitations of the courtroom,
to satisfy the imperative of a transparent, open and public trial.
The National Union of Journalists of the Philippines (NUJP), ABS-CBN Broadcasting

Corporation, GMA Network, Inc., relatives of the victims, individual journalists from various media
entities, and members of the academe filed a petition docketed as A.M. No. 10-11-5-SC praying that
live television and radio coverage of the trial in these criminal cases be allowed, recording devices
(e.g., still cameras, tape recorders) be permitted inside the courtroom to assist the working
journalists, and reasonable guidelines be formulated to govern the broadcast coverage and the use
of devices. In a related move, the National Press Club of the Philippines (NPC) and Alyansa ng
Filipinong Mamamahayag (AFIMA) filed a petition docketed as A.M. No. 10-11-6-SC praying that the
Court constitute Branch 221 of RTC-Quezon City as a special court to focus only on the
Maguindanao Massacre trial to relieve it of all other pending cases and assigned duties, and allow the
installation inside the courtroom of a sufficient number of video cameras that shall beam the audio
and video signals to the television monitors outside the court.
President Benigno S. Aquino III, by letter of November 22, 2010 addressed to Chief Justice
Renato Corona, came out in support of those who have petitioned to permit television and radio
broadcast of the trial." The President expressed earnest hope that the court will, within the many
considerations that enter into such a historic deliberation, attend to this petition with the dispatch,
dispassion and humaneness, such a petition merits. The Court docketed the matter as A.M. No. 10-
11-7-SC.
The Court consolidated A.M. No. 10-11-7-SC with A.M. No. 10-11-5-SC and treated in a
separate Resolution A.M. No. 10-11-6-SC. Petitioners seek the lifting of the absolute ban on live
television and radio coverage of court proceedings. They principally urge the Court to revisit
the 1991 ruling in Re: Live TV and Radio Coverage of the Hearing of President Corazon C. Aquinos Libel
Case and the 2001 ruling in Re: Request Radio-TV Coverage of the Trial in the Sandiganbayan of the
Plunder Cases Against the Former President Joseph E. Estrada which rulings, they contend, violate the
doctrine that proposed restrictions on constitutional rights are to be narrowly construed and
outright prohibition cannot stand when regulation is a viable alternative. Petitioners assert the
exercise of the freedom of the press, right to information, right to a fair and public trial, right to
assembly and to petition the government for redress of grievances, right of free access to courts, and
freedom of association, subject to regulations to be issued by the Court.
ISSUE:
Whether the live television and radio coverage of the trial should be allowed.
RULING:
The Court partially GRANTS pro hac vice petitioners prayer for a live broadcast of the trial
court proceedings, subject to certain guidelines. The basic principle upheld in Aquino is firm ─ [a]
trial of any kind or in any court is a matter of serious importance to all concerned and should not be
treated as a means of entertainment[, and t]o so treat it deprives the court of the dignity which
pertains to it and departs from the orderly and serious quest for truth for which our judicial
proceedings are formulated. The observation that [m]assive intrusion of representatives of the news
media into the trial itself can so alter and destroy the constitutionally necessary atmosphere and
decorum stands.
The Court had another unique opportunity in Estrada to revisit the question of live radio and
television coverage of court proceedings in a criminal case. It held that [t]he propriety of granting or
denying the instant petition involves the weighing out of the constitutional guarantees of freedom of
the press and the right to public information, on the one hand, and the fundamental rights of the
accused, on the other hand, along with the constitutional power of a court to control its proceedings
in ensuring a fair and impartial trial.
One apparent circumstance that sets the Maguindanao Massacre cases apart from the earlier
cases is the impossibility of accommodating even the parties to the cases the private
complainants/families of the victims and other witnesses inside the courtroom. Even before
considering what is a reasonable number of the public who may observe the proceedings, the
peculiarity of the subject criminal cases is that the proceedings already necessarily entail the
presence of hundreds of families. It cannot be gainsaid that the families of the 57 victims and of the
197 accused have as much interest, beyond mere curiosity, to attend or monitor the proceedings as
those of the impleaded parties or trial participants. It bears noting at this juncture that the
prosecution and the defense have listed more than 200 witnesses each.
The impossibility of holding such judicial proceedings in a courtroom that will accommodate
all the interested parties, whether private complainants or accused, is unfortunate enough. What
more if the right itself commands that a reasonable number of the general public be allowed to
witness the proceeding as it takes place inside the courtroom. Technology tends to provide the only
solution to break the inherent limitations of the courtroom, to satisfy the imperative of a transparent,
open and public trial.
LAW ON PUBLIC OFFICERS
Accountability of Public Officers
CORAZON TENORIO v. ALYN C. PERLAS

A.M. No. P-10-2817, 26 January 2011, FIRST DIVISION (Velasco, Jr., J.)
As agents of the law, sheriffs are called upon to discharge their functions with due care and
utmost diligence because, in serving the court’s processes and implementing its order, they cannot
afford to err without affecting the integrity of their office and the efficient administration of justice.
Corazon Tenorio (Tenorio) filed a complaint against Sheriff Alyn C. Perlas (Sheriff Perlas),
charging her with Oppression, Dishonesty, and Grave Misconduct. She alleged that when Sheriff
Perlas arrived at her store, Tey Rey Gravel and Sand and Construction Materials, to serve upon her a
Notice of Levy on Attachment addressed to spouses Edgardo and Marissa Pile (Spouses Pile), she
served the same in a discourteous and arrogant manner. Tenorio showed her the Certificate of Car
Registration of her two units of dump trucks and pleaded to her not to take the dump trucks away
because she was the registered owners of the trucks. However, despite her plea, Sheriff Perlas
forcibly took the two units of trucks without even verifying with the Land Transportation Office
(LTO) as to who were the true registered owners of the trucks.
Sheriff Perlas denied all the allegations in her Tenorio's complaint. As to the trucks, she stated
that she believed in good faith that the trucks belonged to Spouses Pile and that she even tried to get
the certificates of registration from the drivers. However, when the drivers failed to produce the
certificates, she merely assumed that they were owned by the Spouses Pile. Lastly, Sheriff Perlas
claimed that she acted within the scope of her authority, and that she was not discourteous or
arrogant in the exercise thereof.
ISSUE:
Whether Sheriff Perlas is guilty of misconduct.
RULING:
YES. While it is true that sheriffs must comply with their mandated ministerial duty to serve
court writs, execute all processes and carry into effect all court orders promptly and expeditiously, it
needs to be pointed out that this ministerial duty is not without limitation. As agents of the law,
sheriffs are called upon to discharge their functions with due care and utmost diligence because, in
serving the court’s processes and implementing its order, they cannot afford to err without affecting
the integrity of their office and the efficient administration of justice. In this case, Sheriff Perlas’
conduct in implementing the writ is inexcusable, seeing as the two trucks seized by her did not belong
to the spouses, but to Tenorio. What is more is that she could have acted in good faith and checked
from the LTO the identity of the registered owners of the said vehicles before proceeding with their
seizure. Therefore, she is guilty of simple misconduct.
OFFICE OF THE COURT ADMINISTRATOR v. HERMENEGILDO I. MARASIGAN
A.M. No. P-05-2082, 29 November 2011, EN BANC (Per Curiam)
As the Court said in an earlier case, clerks of court are officers of the law who perform vital
functions in the prompt and sound administration of justice. They are designated custodians of the
court’s funds, revenues, records, properties and premises. They are liable for any loss, shortage,
destruction or impairment of such funds and property. The Court found Marasigan liable for gross
neglect of duty.
A financial audit was conducted by the Office of the Court Administrator (OCA) on the
Regional Trial Court, Kabacan, North Cotabato (RTC). The audit covered the accountabilities of Atty.
Hermenegildo I. Marasigan (Marasigan), Clerk of Court of the RTC, from April 1993 to May 2004. The
audit team discovered that the cash count for June 7, 2004 fell short of P660.80. It attributed this
anomaly to Marasigan’s practice of depositing his collections on a monthly, instead of a daily, basis.
Also, the team found a big number of missing documents which were vital in the completion of the
audit. These documents consisted of official receipts (recorded and not recorded in the cashbook),
cancelled official receipts without the original copies, deposit slips, deposit slips without machine
validation, and Fiduciary Fund (FF) withdrawals and passbooks. Because of the non-availability of
the FF passbooks, thee audit team failed to determine the interests earned on the FF deposits which
should have been remitted to the Judiciary Development Fund (JDF). The audit team submitted to the
OCA a final report. The OCA then submitted a report to then Chief Justice Davide.
The Court’s Third Division directed Marasigan to explain his shortcomings as found by the
audit team, and to account for the interest earned on deposits of the FF, to pay the same to the JDF,
among others. Marasigan was also suspended pending resolution of his case. A hold departure order
was likewise issued against him. Marasigan alleged that since January 2005, he had been relieved as
accountable officer of the RTC, Kabacan, North Cotabato; hence, he could not immediately comply
with the Court’s directives. He claimed that in good faith, he entrusted to the cash clerk, Rebecca
Necesito, the court collections, remittances and financial reports. He found out later that the reports
were missing. He asked for the lifting of his suspension; the setting aside of the hold departure order;
and his immediate reinstatement.
ISSUE:
Whether or not Marasigan is guilty of the charges against him.
RULING:
YES. In the present administrative case, it is clear that Marasigan created the mess the audit
team discovered in the management of the court’s funds during the period of April 1993 to May 2004.
Theirregularities occurred because Marasigan allowed them to happen; at the very least, his failure
to supervise and monitor his subordinate already constituted gross negligence in the performance of
his duties. Marasigan admitted that when he assumed office in 1993, he assigned to Necesito in good
faith “the collections, remittances, financial reports and the accountable forms only to find out that
some are already missing. This is a highly irresponsible move. As clerk of court, Marasigan is the
court’s accountable officer, not the cash clerk. No amount of good faith can relieve him of his duty to
properly administer and safeguard the court’s funds. As the Court said in an earlier case, clerks of
court are officers of the law who perform vital functions in the prompt and sound administration of
justice. They are designated custodians of the court’s funds, revenues, records, properties and
premises. They are liable for any loss, shortage, destruction or impairment of such funds and
property. The Court found Marasigan liable for gross neglect of duty.
The Court, thus, found Marasigan miserably failed to perform his duties as clerk of court.
Without doubt, he deserves to be sanctioned administratively for gross neglect of duty. He must be
held liable for all the missing documents and the fund shortages. Under Section 52(A)(1), Rule IV of
the Uniform Rules on Administrative Cases in the Civil Service, gross neglect of duty is punishable by
dismissal. Since the penalty of dismissal inherently carries with it forfeiture of retirement benefits
under Section 58 of the same rule, Marasigan’s financial liability has to be satisfied through his leave
benefits.
ATTY. RUTILLO B. PASOK v. CARLOS P. DIAZ

A.M. No. P-07-2300, 29 November 2011 EN BANC (Per Curiam)
The Court has repeatedly ruled that sheriffs are not authorized to receive any voluntary
payments from parties in the course of the performance of their duties. Furthermore, it must be stressed
anew that the duty of sheriffs to promptly execute a writ is mandatory and ministerial.
Numerous cases were filed against Carlos P. Diaz (Diaz), Sheriff IV of the Regional Trial Court
(RTC) of Tacurong City, for extorting money from winning litigants on the pretext that said amounts
will cover the costs of implementing court processes. Hence, Atty. Rutillo B. Pasok (Atty. Pasok) filed
an administrative complaint against Diaz for Dishonesty, Gross Inefficiency, Abuse of Authority and
violation of Republic Act No. (R.A.) 3019, or the Anti-Graft and Corrupt Practices Act. Atty. Pasok
averred that if parties failed to pay the amounts demanded, Diaz would also refuse to perform his
duty. Atty. Pasok emphasized that Diaz not only demanded and received money from party-litigants,
he, likewise, refused to perform his duties in accordance with the law in the absence of the demanded
money. The investigating judge recommended the imposition of sanctions upon Diaz for failing to
follow the appropriate procedure in the collection of fees relative to the service of processes, writs
and execution of judgment in several civil cases. The Office of the Court Administrator (OCA)
recommended that Diaz be dismissed from service for having been found guilty of grave misconduct.
It further recommended the filing of corresponding criminal charges against Diaz for violation of R.A.
3019.
ISSUE:
Whether or not Diaz is guilty of grave misconduct.
RULING:
YES. Time and again, the Court has pointed out the heavy burden and responsibility which
court personnel are saddled with in view of their exalted positions as keepers of the public faith. They
should, therefore, be constantly reminded that any impression of impropriety, misdeed or negligence
in the performance of official functions must be avoided. Those who work in the judiciary must
adhere to high ethical standards to preserve the courts’ good name and standing. Under Section 9,
Rule 141 of the Rules of Court, the sheriff is required to secure the court’s prior approval of the
estimated expenses and fees needed to implement the court process. Likewise, the Court has
repeatedly ruled that sheriffs are not authorized to receive any voluntary payments from parties in
the course of the performance of their duties.
In this case, Diaz’s act of receiving the balance of P12,400.00 from Sumagaysay in Civil Case
No. 671 is indeed a violation of Canon III, Section 2 (b) of A.M. No. 03- 06-13-SC, which prohibited
court employees from receiving tips or any renumeration for assisting or attending to parties
engaged in transactions involved in actions or proceedings with the Judiciary. Corollary, a sheriff
cannot just unilaterally demand sums of money from a party-litigant without observing the proper
procedural steps; otherwise, it would amount to dishonesty or extortion. The Court also took note
that Diaz’s issuance of a temporary receipt, which was handwritten on a scrap of paper, also
constituted a violation of Section 113 of Article III, Chapter V of the National Accounting and Auditing
Manual which provides that “no payment of any nature shall be received by a collecting officer without
immediately issuing an official receipt in acknowledgment thereof.”
Furthermore, it must be stressed anew that the duty of sheriffs to promptly execute a writ is
mandatory and ministerial. Sheriffs have no discretion on whether or not to implement a writ. There
is no need for the litigants to “follow-up” its implementation. When writs are placed in their hands, it
is their ministerial duty to proceed with reasonable celerity and promptness to execute them in
accordance with their mandate. Unless restrained by a court order, they should see to it that the
execution of judgments is not unduly delayed. Clearly, in Civil Case No. 761, when Diaz took it upon
himself to mediate between litigants and even provided an extension of the implementation of the
writ, he appeared to be lacking in the amount of diligence required of him in the performance of his
duties. As per records, this is not respondent’s first offense. In A.M. No. P-07-2332 dated September 4,
2009, Diaz had been previously suspended for one (1) month and one (1) day for Simple Neglect of
Duty. Thus, following the Civil Service Rules and the fact that this is his second infraction involving
similar charges, dismissal from service is the appropriate penalty to be imposed on Diaz.
OFFICE OF THE COURT ADMINISTRATOR (OCA) v. ATTY. TEOTIMO D. CRUZ

A.M. No. P-11-2988, 12 December 2011, THIRD DIVISION (Mendoza, J.)
The unwarranted failure to faithfully perform this responsibility deserves administrative

sanction. Ordinarily, unreasonable delay in the remittances of collections constitutes neglect of duty
punishable by suspension of one month and one day to six months for the first offense and dismissal for
the second offense.
Atty. Teotimo D. Cruz (Atty. Cruz) is a former Officer-in-Charge of the Office of the Clerk of
Court, Regional Trial Court, San Mateo, Rizal (RTC). Atty. Cruz succeeded Atty. Fermin M. Ofilas (Atty.
Ofilas). Atty. Cruz compulsory retired on April 15, 2011. A financial audit was conducted by the Court
Management Office (CMO) of the books of account of Atty. Cruz. The audit conducted disclosed that
there was a cash shortage in the amount of P928,534.24. Of the said amount, P12,000.00 was incurred
during the term of Atty. Cruz. It was found that the cash shortage of P12,000.00 was the result of a
double withdrawal of cash bond posted in two criminal cases under a receipt dated July 21, 2002.
The records likewise revealed that Atty. Cruz incurred a delay in the remittances of his collections.
Per computation, the non-remittances of court collections deprived the Court of the interest in the
amount of P34,578.17 had the collections been deposited on time. The Office of the Court
Administrator (OCA) recommended that a fine of P5,000.00 be imposed upon Atty. Cruz. It directed
the Finance Division of the OCA to deduct from Atty. Cruz’s retirement benefits the shortages in his
collections in the amount of P12,000.00 the fine of P5,000.00, and P34,578.17 representing the
interests that could have been earned had the collections been deposited on time.
ISSUE:
Whether or not the recommendation of the OCA is proper.
RULING:
YES. Clerks of Court are officers of the law who perform vital functions in the prompt and
sound administration of justice. They are the courts’ treasurers, accountants, guards and physical
plant managers. As custodian of court funds and revenues, it is their duty to immediately deposit the
various funds received by them to the authorized government depositories for they are not supposed
to keep funds in their custody. Atty. Cruz’ belated turnover of cash deposited with him is inexcusable
and will not exonerate him from liability. His failure to remit his cash collections on time is violative
of Administrative Circular No. 3-2000 which mandates that all fiduciary collections shall be deposited
immediately by the Clerk of Court concerned, upon receipt thereof, with the Land Bank of the
Philippines, the authorized government depository bank.
The unwarranted failure to faithfully perform this responsibility deserves administrative

sanction. Ordinarily, unreasonable delay in the remittances of collections constitutes neglect of duty
punishable by suspension of one month and one day to six months for the first offense and dismissal
for the second offense. Considering, however, that Atty. Cruz has retired from the service and
considering that this is his first infraction, the Court finds the OCA’s recommended penalty of
P5,000.00 fine to be in order. Atty. Cruz is, thus, meted with P5,000.00 fine and ordered to restitute
shortages in his collections in the sum of P12,000.00 and pay interests in the sum of P34,578.17.
OFFICE OF THE COURT ADMINISTRATOR v. JOSE M. RAMANO

A.M. No. P-90-488, 25 January 2011, EN BANC, (Per Curiam)
When writs are placed in the hands of a sheriff, it is his ministerial duty to proceed with
reasonable celerity and promptness to execute them in accordance with their mandate.
Due to the alleged acts of extortion, deliberate delay in serving court processes, and refusal
to levy, Jose S. Dela Riva filed a criminal complaint against Sheriff Jose M. Ramano (Ramano) with the
Sandiganbayan for violation of Section 3 (f) of R.A. No. 3019 (Anti-Graft and Corruption Law). In the
meantime, an administrative complaint was likewise filed by then Court Administrator Meynardo A.
Tiro against Ramano. For his part, Ramano argued that the delay in the enforcement of the writ of
execution was due to the fault of Dela Riva. Due to the pendency of the criminal case against Ramano,
the Court held in abeyance the determination of the administrative liability of Ramano. Later, the
Sandigangbayan convicted Ramano for violation of RA 3019. This conviction was affirmed by
Supreme Court on appeal. Consequently, an entry of judgment was issued. However, up to this date,
Romana remains at-large.
Thereafter, SC referred the administrative case of Ramano with the Office of the Court
Administrator (OCA). OCA Ramano guilty of serious misconduct and recommended his dismissal
from service with forfeiture of all benefits, except accrued leave credits.
ISSUE:
Whether or not Ramano should be administratively sanctioned

RULING:
YES. Sheriffs ought to know that they have a sworn responsibility to serve writs of execution
with utmost dispatch. When writs are placed in their hands, it is their ministerial duty to proceed
with reasonable celerity and promptness to execute them in accordance with their mandate. Unless
restrained by a court order, they should see to it that the execution of judgments is not unduly
delayed. Accordingly, they must comply with their mandated ministerial duty as speedily as possible.
As employees of the court who play an important role in the administration of justice, high standards
are expected of sheriffs. At the grassroots of our judicial machinery, sheriffs and deputy sheriffs are
indispensably in close contact with the litigants, hence, their conduct should be geared towards
maintaining the prestige and integrity of the court, for the image of a court of justice is necessarily
mirrored in the conduct, official or otherwise, of the men and women who work thereat, from the
judge to the least and lowest of its personnel; hence, it becomes the imperative sacred duty of each
and everyone in the court to maintain its good name and standing as a temple of justice.
NILDA VERGINESA-SUAREZ v. JUDGE RENATO J. DILAG AND COURT STENOGRAPHER III

CONCEPCION A. PASCUA
A.M. Nos. RTJ-06-2014 & RTJ-11-2293, 16 August 2011, EN BANC (Per Curiam)
Judge Dilag’s failure to promptly act on the cases before his sala and to supervise his staff in the
proper keeping of the docket books and case records were acts that only demonstrated gross negligence
and inefficiency.
A complaint submitted by Court Stenographer III Nilda Verginesa-Suarez and a series of

anonymous letters were received by the Office of the Court Administrator (OCA) against Judge Dilag
and Court Stenographer III Concepcion A. Pascua. In response, the OCA constituted an audit team to
conduct an inventory of the cases in the court presided by Judge Dilag. The OCA audit team reported
414 cases pending before Judge Dilag’s court, either for decision, resolution, or in other stages of
proceedings which were not acted upon for a considerable length of time. There were also
irregularities in Judge Dilag’s handling of several cases pending before his court which included those
decisions which have conflicting judgments.
The investigating judge then recommended that Judge Dilag be held administratively liable
for gross misconduct constituting violations of the Code of Judicial Conduct, gross ignorance of the
law and procedure, gross negligence, and gross inefficiency; and that Pascua, be held administratively
liable for graft and corruption. The Supreme Court (SC) adopted the recommendation and ordered
the dismissal of Pascua and Judge Dilag from service. The SC directed Judge Dilag to decide/resolve
the 414 cases pending in his sala. Further, directed Officer-in-Charge (OIC) Ester Asilo to take action
on the observations made by the audit team, and that Branch Clerk of Court Atty. Ronald B. Gavino
was ordered to explain why the report on certain ex-parte proceedings were not submitted to the SC.
ISSUE:
Whether or not Judge Dilag, Pascua, OIC Asilo and Atty. Gavino should be held
administratively liable.
RULING:
YES. The audit and physical inventory of the cases pending before Judge Dilag’s sala revealed
377 cases already submitted for decision or resolution or still in various stages of proceedings, which
Judge Dilag failed to decide or resolve within the reglementary period or to act upon for a
considerable length of time without proper justification. In addition to not being updated, the docket
books of Judge Dilag’s court contained deficient and improper entries. Returns of warrants of arrest
and court orders with directives to parties were not properly monitored and attached to the
records. Judge Dilag eventually decided, resolved, and/or acted upon the aforementioned 377 cases,
pursuant to our Resolution of August 1, 2006; but the OCA, in its Memorandum dated October 21,
2008, still found Judge Dilag’s full compliance unsatisfactory and recommended Judge Dilags
dismissal from the service.
On the other hand, OIC Asilo’s inaccurate preparation of the monthly case reports, inept
monitoring of case records, and incompetent supervision of court personnel, all constituted
inefficiency and incompetence in the performance of official duties. As for Atty. Gavino, the OCA
found unsatisfactory his explanation for failing to submit a report on the ex parte proceedings.
RE: LETTER-COMPLAINT OF MR. RECARREDO S. VALENZUELA, CLERK IV, PERSONNEL

DIVISION, OAS-OCA AGAINST MR. RICARDO R. GIGANTO, UTILITY WORKER II, PERSONNEL
DIVISION, OAS-OCA
A.M. No. 2011-01-SC, 23 August 2011, EN BANC (Carpio, J.)
Misconduct is defined as any unlawful conduct on the part of a person concerned in the
administration of justice prejudicial to the rights of parties or to the proper determination of the cause.
It generally means wrongful, improper or unlawful conduct motivated by a premeditated, obstinate or
intentional purpose.
Recarredo Valenzuela filed a complaint against Ricardo Giganto for Grave Misconduct
Unbecoming a Court Employee. Valenzuela alleged that he was standing near his office table when
Giganto suddenly, without any provocation on his part, pulled his shirt and punched him in the face.
Giganto, on the other hand, claimed that Valenzuela made a false story that their co-worker, Crisanto
Madeja, wanted to stab Giganto. When Giganto confronted Madeja, the latter denied ever having said
he wanted to stab the former. Giganto thereafter talked to Valenzuela. A heated argument ensued
which resulted in a fistfight. The Office of the Administrative Services (OAS) recommended that both
Valenzuela and Giganto be administratively disciplined.
ISSUE:
Whether or not Giganto’s acts amounts to gross misconduct, as complained of by Valenzuela.
RULING:
NO. Misconduct is defined as any unlawful conduct on the part of a person concerned in the
administration of justice prejudicial to the rights of parties or to the proper determination of the
cause. It generally means wrongful, improper or unlawful conduct motivated by a premeditated,
obstinate or intentional purpose. The term "gross" connotes something "out of all measure; beyond
allowance; not to be excused; flagrant; shameful."
In Giganto's case, his actions as the aggressor in the fistfight, while condemnable, are not totally
inexcusable as he was also provoked by the fabricated stories and antagonistic attitude of Valenzuela.
Hence, this Court finds him guilty only of simple misconduct. The Court affirms the OAS'
recommendation of suspension of 30 days on Giganto, considering his twelve years of service, his
very satisfactory performance ratings for the past three consecutive semesters, and the fact that this
is his first administrative charge, as mitigating circumstances.
Valenzuela, on the other hand, cannot be exonerated from liability. Valenzuela, through his
statements, would like the Court to believe that he was totally innocent in this case. He denied saying
that Giganto was being hunted down by Chris Medaja, which was the root cause of the fight. He denied
throwing any punches against Giganto. He denied having any confrontation prior to the fistfight, and
claimed he was just punched suddenly out of nowhere without provocation. He also claimed that he
fell down due to the strength of Giganto's punches. Valenzuela's claims and denials, which were made
under oath and executed in affidavits, were clearly rebutted by the candid sworn statements of
witnesses Abner Cruz, Joanne Ruaburo and Crisanto Medaja. The Court considers the mitigating
circumstances of Valenzuela's four years of service, and very satisfactory ratings for the past three
consecutive semesters.
THE CIVIL SERVICE COMMISSION v. RICHARD G. CRUZ

G.R. No. 187858, 9 August 2011, EN BANC (Brion, J.)
Before an employee may be entitled to back salaries, two conditions must concur: a) the
employee must be found innocent of the charges and b) his suspension must be unjustified.
Richard Cruz was charged with grave misconduct and dishonesty for uttering a false and
malicious statement against General Manager (GM) Nicasio Reyes and the Board of Directors (BOD)
of the City of Malolos Water District (CMWD). The dishonesty charge stemmed from Cruz claiming
overtime pay despite having failed to record his log-in/log-out in the computerized daily time record
for 3 days. Cruz denied the charges, arguing that the persons who witnessed him utter the alleged
false and malicious words already retracted their testimonies. Moreover, he denied having failed to
log-in/log-out; that there was a technical problem with their computers. He even presented
documents showing that he worked overtime on thos 3 days.
Cruz was preventively suspended, and before the end of the period of suspension, Cruz was
dismissed. The Civil Service Commission (CSC) found Cruz innocent and ordered his reinstatement.
However, the CSC did find Cruz guilty of violating office rules and regulations and imposed on him
the penalty of reprimand without awarding Cruz back salaries. Upon appeal, the Court of Appeals
(CA) ruled that Cruz is entitled to back salaries. CSC assails the decision of the CA on the ground that
its resolution did not fully exonerate Cruz but merely found liable for a lesser offense, hence, he is
not entitled to payment of his back salaries. But Cruz avers that he is indeed entitled to his back
salaries because he was exonerated by CSC from the charges against him and that CSC found him
liable for an offense different from what he was originally charged, which is immaterial to the issue
of back salaries.
ISSUE:
Whether or not Cruz was exonerated by the CSC, and if so, if he is entitled to backwages for
the period he was preventively suspended pending appeal.
RULING:
YES. The Court crafted two conditions before an employee may be entitled to back salaries:
a) the employee must be found innocent of the charges and b) his suspension must be unjustified.
The records show that the charges of grave misconduct and dishonesty against Cruz were not
substantiated. As the CSC found, there was no corrupt motive showing malice on the part of the Cruz
in making the complained utterance. Likewise, the CSC found that the charge of dishonesty was well
refuted by the Cruz’s evidence showing that he rendered overtime work on the days in question. The
Court fully respects the factual findings of the CSC especially since the CA affirmed these factual
findings. However, on the legal issue of Cruz’s entitlement to back salaries, we are fully in accord with
the CA’s conclusion that the two conditions to justify the award of back salaries exist in the present
case.
The first condition was met since the offense which the Cruz was found guilty of (violation of
reasonable rules and regulations) stemmed from an act (failure to log in and log out) different from
the act of dishonesty (claiming overtime pay despite his failure to render overtime work) that he was
charged with. On the suspension/dismissal aspect, this second condition is met upon a showing that
the separation from office is not warranted under the circumstances because the government
employee gave no cause for suspension or dismissal. This squarely applies in cases where the
government employee did not commit the offense charged, punishable by suspension or dismissal
(total exoneration); or the government employee is found guilty of another offense for an act different
from that for which he was charged. The second condition was met as the Cruz committed offense
merits neither dismissal from the service nor suspension (for more than one month), but only
reprimand.
In sum, the Cruz is entitled to back salaries from the time he was dismissed by the CMWD
until his reinstatement to his former position - i.e., for the period of his preventive suspension
pending appeal. For the period of his preventive suspension pending investigation, the respondent is
not entitled to any back salaries.
REINA EDENLYNE GARCIA v. ROBERT V. ALEJO

A.M. No. P-09-2627, 26 January 2011, SECOND DIVISION, (Carpio, J.)
Sheriffs are not allowed to receive any voluntary payments from parties in the course of the
performance of their duties. To do so would be inimical to the best interest of the service.
Robert V. Alejo (Alejo), Sheriff IV of the Regional Trial Court, Branch 142, Makati City was
allegedly acting as a Collecting Officer of Concorde Condominium, Inc. (Concorde) and as a
consequence thereof he is under the payroll of Concorde. Later, Reina Edenlyne Garcia (Garcia),
claiming to be the legitimate president of Concorde, alleges that when the legitimate board of
directors took over the management of the corporation, it was discovered that, in order to maintain
power, anomalies and irregularities were committed by the usurpers including conspiring with
people who willingly cooperated with the former who, according to her, includes Alejo.
As such Garcia filed an administrative complaint against Alejo with the Office of the Court
Administrator (OCA) ascribing Gross Misconduct, Gross Dishonesty and Conduct Prejudicial to the
Interest of the Service against Alejo. The OCA found Alejo guilty of dereliction of duty. The OCA noted
that Alejo’s role as collecting officer, though allegedly performed outside of normal working hours, is
"incompatible with the performance of his duties and responsibilities since it would appear that the
work would adversely reflect on the integrity of the judiciary. Thereafter, the OCA recommended that
the administrative case against Alejo be re-docketed as regular administrative complaint and that
Alejo be found guilty of dereliction of duty.
ISSUE:
Whether or not Alejo should be administratively sanctioned.
RULING:
YES. A sheriff may collect fees for his expenses from the party requesting the execution of a
writ but only in accordance with the procedure laid down in Section 9, Rule 141 of the Rules of Court.
Clearly, the steps that have to be followed before additional sums may be required are: first, the
sheriff must make an estimate of the expenses to be incurred by him; second, he must obtain court
approval for such estimated expenses; third, the approved estimated expenses shall be deposited by
the interested party with the Clerk of Court and ex-oficio sheriff; fourth, the Clerk of Court shall
disburse the amount to the executing sheriff; and fifth, the executing sheriff shall disburse liquidate
his expenses within the same period for rendering a return on the writ.
Sheriffs are not allowed to receive any voluntary payments from parties in the course of the
performance of their duties. To do so would be inimical to the best interest of the service because
even assuming arguendo such payments were indeed given and received in good faith, this fact alone
would not dispel the suspicion that such payments were made for less than noble purposes. Sheriffs
cannot receive gratuities or voluntary payments from parties they are ordered to assist. Court
personnel shall not accept any fee or remuneration beyond what they receive or are entitled to in
their official capacity. Moreover, Alejo’s defense that he is not using government time in doing his
duties is not tenable considering that there is a prohibition for all officials and employees of the
judiciary to engage directly in any private business, vocation or profession even outside office hours.
Alejo’s acts can be considered as moonlighting, which, though not normally considered as a serious
misconduct, amounts to malfeasance in office.
REPORT ON THE FINANCIAL AUDIT CONDUCTED ON THE BOOKS OF ACCOUNT OF SONIA L.

DY AND ATTY. GRACIANO D. CUANICO, JR., REGIONAL TRIAL COURT, CATARMAN, NORTHERN
SAMAR.
A.M. No. P-07-2364 and P-11-2902, 25 January 2011, EN BANC, (Per Curiam)
Those charged with the dispensation of justice, from the justices and judges to the lowliest clerks,
should be circumscribed with the heavy burden of responsibility.
As a consequence of an audit conducted on the books of account of Regional Trial Court (RTC)
of Catarman, Northern Samar, it was found out that there were shortage in the Judiciary Development
Fund (JDF) and Fiduciary Fund (FF). These books of accounts were under the direct control of Sonia
L. Dy (Dy), Social Worker II and former Officer-in-Charge, and Atty. Graciano D. Cuanico, Jr. (Cuanico),
incumbent Clerk of Court of the said RTC. Later the report showed shortage in the Judiciary
Development Fund (JDF) and Fiduciary Fund (FF). As such, the OCA Audit Team recommended the
filing of an administrative complaint against Dy and Cuanico. Dy, in her unnotarized Affidavit, averred
that the shortage of fund was used to accommodate the health needs of the late Judge Ernesto
Corocoto and that Corocoto died before he could pay the same. As a consequence, a complaint was
filed against Dy and Cuanico. Prior to the resolution of the cases filed against them, the Court resolved
to consider dropping Dy from the rolls without prejudice to the final outcome of the case and to
suspend payment of all monetary benefits due Dy.
ISSUE:
Whether or not they should be held administratively liable
RULING:
YES. Personnel of the judiciary have always been held to high and exacting standards befitting
the office of dispensing justice. As Clerk of Court, Cuanico is charged with the efficient recording,
filing, and management of court records, and with the administrative supervision over court
personnel. Clerks of Court cannot be permitted to slacken on their jobs under one pretext or another.
Audits and other processes are but ways to determine wrongdoing. Cuanico worked with the
culpable persons on a daily basis and thus could observe their demeanor and their dealings with
people. He was in a position to see if the personnel under his supervision were performing their tasks
or if they were committing misdeeds. He cannot escape liability by arguing that the COA auditors
found no discrepancies in the funds’ records. He was primarily responsible for the funds being
administered by his office. He failed to discharge his duty of overseeing the court personnel under
his supervision. His failure to properly supervise and manage the financial transactions in his court
constituted simple neglect of duty.
As to Dy, she herself admitted her liability, but justifies her action by saying that the same was to
accommodate the late Judge Corocoto. This, however, does not excuse her actions. Whatever may
have been her motivation, the fact remains that Dy falsified receipts and took money that properly
belonged to the judiciary. As the OIC of the Office of the Clerk of Court, Dy bore the same
responsibilities and was expected to serve with the same commitment and efficiency as a duly-
appointed Clerk of Court. Likewise, she must be held liable for any loss, shortage, destruction, or
impairment of the funds entrusted to her by virtue of her office.
PRESIDENTIAL ANTI-GRAFT COMMISSION and THE OFFICE OF THE PRESIDENT v. SALVADOR

PLEYTO
G.R. No. 176058, 23 March 2011, SECOND DIVISION (Abad, J.)
There is negligence when there is a breach of duty or failure to perform the obligation, and there
is gross negligence when breach of duty is flagrant and palpable.
Presidential Anti- Graft Commission (PAGC) received an anonymous letter- complaint from
alleged employees of the Department of Public Works and Highways (DPWH). The letter accused
DPWH Undersecretary Salvador Pleyto (Pleyto) of extortion, illicit affairs, and manipulation of DPWH
projects. PAGC examined Pleyto’s 1999, 2000, and 2001 SALNs and it observed that he did not
disclose his wife’s business interests and financial connections. Thus, Pleyto was charged before the
Office of the President (OP) for violation of Section 8 of Republic Act no. 6713 and Section 7 of
Republic Act No. 3019. Pleyto claimed that he wrote “NONE” under the column of business interests
because he and his wife had no business interests of any kind. He attributed the mistake to the fact
that his SALNs were merely prepared for him by his wife’s bookkeeper. PAGC found Pleyto guilt and
recommended his dismissal with forfeiture of all government benefits and disqualification to re-enter
government service. OP approved the recommendation.
Pleyto filed urgent motion for reconsideration claiming that he should first be allowed to avail
of review and compliance procedure in Section 10 of RA No. 6713, he and his wife has no business
interests related to DPWH, and failure to indicate his wife’s business interests is not punishable under
RA No. 3019. PAGC, on the other hand, claimed that Pleyto is not entitled to Section 10 of RA No. 6713
since the mechanism had not yet been established and his failure to indicate the interests was highly
irregular and a form of dishonesty. The motion was denied. On appeal, the Court of Appeals (CA)
permanently enjoined PAGC and OP from implementing its decisions.
ISSUES:
1. Whether or not Pleyto’s failure to indicate his wife’s business interests in his SALNs a constitutes
gross misconduct
2. Whether or not Review and Compliance Procedure under Section 10 of RA 6713 is prerequisite
to filing of administrative charges for false declarations or concealment in SALN
RULING:
1. NO. An act done in good faith, which constitute only an error of judgment and for no ulterior
motive, does not qualify as gross misconduct, and is merely simple negligence. At most, Pleyto is guilty
of negligence for having failed to ascertain that his SALN was accomplished properly, accurately, and
in more detail. Pleyto’s failure to disclose his wife’s business interests constituted simple negligence,
not gross misconduct or dishonesty. On the front page of Pleyto’s SALN, it was clearly stated that his
wife is a businesswoman; thus, it can be logically deduced that she had business interests. Statement
of his wife’s occupation would be inconsistent with the intention to conceal his and his wife’s business
interests. Both Section 8 of RA 6713 and Section 7 of RA 3019 require accomplishment and
submission of true, detailed, and sworn statement of assets and liabilities. Pleyto was negligent for
failing to comply with his duty to provide a detailed list of his asset and business interests in his SALNs
and for relying on the family bookkeeper to fill out his SALNs. Absence of bad faith or intent to
mislead, his negligence is only simple.
2. NO. The Section merely authorizes the Committee designated by both Houses of congress to
interpret law governing SALNs. Officers affected by such interpretative opinions may be allowed to
correct their SALNs according to that opinion. What the law prohibits is the retroactive application of
the committee’s opinion. The law does not say that a public officer who violated RA 6713 must first
be notified of any concealed or false information in his SALN and allowed to correct it before he is
administratively charged. Also, the only concern of Review and Compliance Procedure is to determine
whether SALNs are complete and in proper form. The Court rejected the view that the procedure
refers to the review of the substance of SALN because assuring the truth and accuracy of its content
is the function of the filer. It is to be noted that RA 6713 is enacted to promote high standard of ethics
in public service. Public officials and employees are accountable to the people; thus, the Court cannot
interpret the Review and Compliance Procedure as transferring such accountability to the
Committee.
FILIPINA SAMSON v. JULIA RESTRIVERA

G.R. No. 178454, 28 March 2011, THIRD DIVISION (Villarama, Jr. J.)
Unbecoming conduct means improper performance and applies to a broader range of

transgressions of rules not only of social behavior but of ethical practice or logical procedure or
prescribed method.
Filipina Samson (Samson) is a government employee, being a department head of the

Population Commission. Samson agreed to help her friend, Julia Restrivera (Restrivera) to register a
land. She accepted P50,000 from Restrivera to cover the initial expenses for titling of the land.
However, Samson failed to accomplish the task because the land was discovered to be government
land. She also failed to return the money received resulting to filing of estafa by Restrivera. The latter
also filed administrative complaint for grave misconduct or conduct of unbecoming a public officer
against Samson before the Office of Ombudsman. The Ombudsman found Samson guilty of violating
Section 4(b) of RA No. 6713 and suspended her from office for 6 months without pay. It ruled that
Samson failed to abide by the standard set in the mentioned law and deprived government of the
benefit of committed service when she embarked on her private interest to help Restrivera secure a
title. In a motion for reconsideration, Ombudsman reduced the penalty to 3 months and still ruling
that Samson fell short of the standard personal conduct prescribed. On appeal, Court of Appeals (CA)
affirmed Ombudsman’s order holding that Ombudsman has jurisdiction even if the subject is private
matter.
ISSUES:
1. Whether or not Samson is guilty of violating Section 4(A)(b) of RA 6713

2. Whether or not Samson is guilty of conduct if unbecoming a public officer
3. Whether or not Ombudsman have jurisdiction over a case involving a private dealing by a
government employee or where the act is complained of is not related to the performance of
official duty
RULING:
1. NO. The Court believed that Samson may not be penalized for violation of Section 4(A)(b)
of RA 6713. However, it is not because the transaction is not related to official duty but because failure
to abide by the norms of conduct under Section 4(A)(b) is not a ground for disciplinary action. The
implementing rules of the law does not provide sanction for failure to observe these norms of
conduct. Ombudsman and CA both found Samson administratively liable for violating Section 4(A)(b)
on professionalism. Professionalism is the conduct, aims, or qualities that characterize or mark a
profession. Under the law, the observance of professionalism means upholding the integrity of public
office by endeavoring to discourage wrong perception of their roles as dispensers or peddlers of
undue patronage. Thus, public official should avoid any appearance of impropriety affecting the
integrity of government services.
2. YES. For Samson’s failure to return the amount initially given by her friend, she is guilty of
conduct of unbecoming a public officer. Unbecoming conduct means improper performance and
applies to a broader range of transgressions of rules not only of social behavior but of ethical practice
or logical procedure or prescribed method. In the present case, Samson should have complied with
her promise to return the amount to Restrivera after failing to accomplish the task she had willingly
accepted. However, she waited for Restrivera to file estafa suit, thus enforcing the suspicion that the
money was misappropriated. Clearly, by her actuations, Samson violated basic social and ethical
norms in her private dealings. Even if unrelated to duties as public officer, Samson’s transgression
could erode trust in government employees.
3. YES. Under Section 13(1), Article XI of the 1987 Constitution, Ombudsman is empowered
to investigate on its own or on complaint by any person any act or omission of any public officer or
employee when such act or omission appears to be illegal, unjust, or improper. Also, under the
Ombudsman Law, the jurisdiction of Ombudsman encompasses all kinds of malfeasance,
misfeasance, and nonfeasance committed by public officers. The law does not qualify the nature of
the illegal act or omission of public official or employee that Ombudsman may investigate.
VICTOR R. REYES, substituted by his heirs, CLARIBEL G. REYES, et al. v. COURT OF APPEALS, et
al.
G.R. No. 167002, 06 December 2011, EN BANC (Mendoza, J.)
No officer or employee in the civil service shall be removed or suspended except for cause
provided by law. He acquired a legal right to the office which is protected not only by statute but also by
the Constitution.
Senen Tomada (Tomada) was assigned at the Office of the City Treasurer of Manila as Local
Treasury Operations Officer IV. On March 26, 1998, or forty-six days before the May 11,
1998 elections, then Mayor Alfredo Lim (Lim) of the City of Manila appointed Tomada as City
Government Assistant Department Head III (Assistant City Assessor, or subject position). On the
same date, Tomada’s appointment, which was indicated as Transfer with Promotion, was submitted
to the Civil Service Commission Field Office (CSCFO) in Manila for consideration and approval. Upon
clarification with Commission on Elections (COMELEC) whether her appointment to the subject
position was prohibited under Sec. 261(g) of the Omnibus Election Code (OEC), the COMELEC opined
that her appointment was valid. CSCFO Head Arturo Panaligan (Panaligan) wrote to the Civil Service
Commission (CSC) office requesting clarification on the validity of Tomada’s appointment given the
prohibition against certain personnel actions under Section 261(g) and (h) of the OEC. Pending action
on Tomada’s appointment, Mayor Jose L. Atienza, Jr. (Mayor Atienza), who was elected Mayor of
Manila, appointed Hernando Garcia (Garcia) to the subject position. Panaligan then cancelled
Tomada’s appointment without awaiting the CSCs reply to his letter, explaining that said
appointment constituted a transfer which was allegedly a violation of Sec. 261(h) of the OEC.
Subsequently, the CSC issued Resolution No. 99, 2208 approving Tomada’s promotional
appointment. Panaligan wrote to Mayor Atienza requesting immediate implementation of the said
CSC resolution and recalling Garcia’s appointment to the subject position.
Hence, Garcia filed a petition for certiorari and quo warranto before the Court of Appeals (CA).
In the meantime, Victor Reyes (Reyes) filed a motion for intervention in his alleged capacity as the
incumbent Assistant City Assessor of Manila. The CA granted the motion. Thereafter, the CA granted
the petition of Garcia and upholding his appointment over the claims of Tomada and Reyes to the
position. The CA opined that Tomada’s promotion did not fall within the 45-day period prior to
the May 11, 1998 elections (Sec. 261[g], OEC). However, her transfer from the Office of the City
Treasurer to the Office of the City Assessor is a violation of Art. 261(h) of the OEC. Hence, this petition.
On September 20, 2006, Reyes passed away, leaving his heirs Claribel G. Reyes, Clarissa G. Reyes and
Czarina G. Reyes as substitute petitioners.
ISSUE:
Whether or not Garcia’s appointment must be upheld.
RULING:
YES. Garcia qualified, assumed office and became at that moment a government employee or
part of the civil service, he then began to enjoy the constitutional protection that No officer or
employee in the civil service shall be removed or suspended except for cause provided by law. He
acquired a legal right to the office which is protected not only by statute but also by the
Constitution. Therefore, he could only be removed for cause, after notice and hearing, consistent with
the requirements of due process. Here, Garcia was not accorded due process. It was only by a letter
to Garcia dated June 7, 2000 from the CSC-GSIS Field Office that the CSC officially communicated,
through Manila City Personnel Officer Josefino Reoma, that his appointment as City Government
Assistant Department Head III (Assistant City Assessor) was recalled and that Mayor Atienza was
requested to implement CSC Resolution Nos. 992208 and 001214 approving the appointment of
Tomada. He was never given an opportunity to be heard. As Garcia’s appointment was valid, there
was no vacancy and Reyes could not ask for reinstatement or even reappointment. A fortiori, he (or
his heirs) could not demand backwages.
RE: GROSS VIOLATION OF CIVIL SERVICE LAW ON THE PROHIBITION AGAINST DUAL
EMPLOYMENT AND DOUBLE COMPENSATION IN THE GOVERNMENT SERVICE COMMITTED
BY MR. EDUARDO V. ESCALA, SC CHIEF JUDICIAL STAFF OFFICER, SECURITY DIVISION, OFFICE
OF ADMINISTRATIVE SERVICES
AM NO. 2011-04-SC, 5 July 2011, EN BANC (Per Curiam)
Public officers and employees ought to live up to the strictest standards of honesty and integrity,
considering that their positions primarily involve service to the public.
Eduardo Escala (Escala) was appointed by the Court as SC Chief Judicial Staff Officer. During
the course of his employment, an anonymous letter reached the Office of Administrative Services
(OAS) reporting Escala’s gross violation of the Civil Service Law on the prohibition against dual
employment and double compensation in the government service. The letter alleged that Escala
accepted employment, and thus received salaries, from the Court and also from PNP of which he
remained as an active member. Considering the seriousness of the matter, he was preventively
suspended pending the results of investigations. Escala was ordered to explain why he should not be
administratively charged with gross dishonesty and conduct prejudicial to best interest of the service.
Escala claimed that he applied for optional retirement as member of PNP and pending approval of
the application, he applied with Supreme Court for position of Chief Security Officer. Due to urgent
need to fill in the said position, he was hired. He further claimed that his application for retirement
was not immediately acted upon resulting to overlapping of his employment with SC and PNP. OAS
considered that there is sufficient evidence to support a finding that Escala is liable for gross
dishonesty and conduct prejudicial to the best interest of the service. It recommended dismissal of
Escala.
ISSUE:
Whether or not Escala should be dismissed for violating prohibition against dual employment
and double compensation.
RULING:
YES. The Court agrees with the findings of OAS and adopts its recommendation. For
knowingly and willfully transgressing the prohibition on dual employment and double compensation,
as well as the Court’s rules for its personnel on conflict of interest, Escala violated the trust and
confidence reposed on him by the Court. Section 7, Article IX-B of the 1987 Constitution provides that
no appointive official shall hold any other office or employment in the Government. Also, the
prohibition on dual employment and double compensation in the government service is specified
under Sections 1 and 2, Rule XVIII of the Omnibus Rules Implementing Book V of EO No. 292.
In the case at bar, OAS found that Escala’s claim that he applied for optional retirement was
merely an afterthought. Escala first made clear to be appointed to the Court prior to filing of his
application for retirement. His regular receipt of salaries from PNP despite presumably working with
the Court implies a deliberate intent to give unwarranted benefit to himself and undue prejudice to
the government. Also, he did not immediately refund his overpayment. Lapse of almost 2 years
without him doing so speaks of his intent not to return the same. His receipt of salaries from PNP
despite not rendering any service thereto is a form of deceit which amounts to gross dishonesty.
PETRA MARTINEZ v. FILOMENA VILLANUEVA

G.R. No. 169196, 6 July 2011, FIRST DIVISION (Villarama, JR., J.)
Section 7(d) of RA No. 6713 is malum prohibitum; therefore, the commission of the act
determines whether or not the provision has been violated, and not the character thereof.
Petra Martinez (Martinez) is the General Manager of Claveria Agri- Based Multi Purpose
Cooperative, Inc, (CABMPCI) while Filomena Villanueva (Villanueva) is the Assistant Regional
Director of the Cooperative Development Authority. Villanueva obtained a loan in two different dates
from CABMPCI with loan note and cash disbursement approved by Martinez. CABMPCI issued a
certification that Villanueva paid in full her loan. Villanueva’s husband also obtained loan from
CABMPIC but Martinez claimed that Sps. Villanuenva came to her and asked her to transfer the loans
from Villanueva to her husband so that her name will not be among the list of borrowers, she being
an official of CDA. Due to moral ascendancy, Martinez acceded to the request. Martinez further
claimed that the certification that Villanueva paid her loan in full was issued despite the fact that no
money was actually received. Martinez filed with CDA an administrative complaint against Villanueva
for Willful Failure to Pay Just Debt and later on with the Office of the Deputy Ombudsman charging
Villanueva with violation of Article 215(8) of Revised Penal Code in relation to Section 11(20) of RA
No. 6713.
Graft Investigation Officer found Villanueva liable for grave misconduct and recommending
penalty of dismissal. Deputy Ombudsman affirmed the findings but reduced the penalty from
dismissal to 6 months suspension without pay. On review, Court of Appeals (CA) reversed the ruling
and held that the only limitation for CDA Officers or employees in RA 6938 is Article 28 which
disqualifies them from being elected or appointed to any position in a cooperative.
ISSUES:
1. Whether or not Section 28 of RA No. 6938 is the only prohibition applicable to CDA officials
and employees.
2. Whether or not payment of the loan is material to the determination of Villanueva’s
administrative guilt.
RULING:
1. NO. Nothing in RA No. 6938 shows that it repealed the provisions of RA No. 6713 as regards
prohibitions on CDA officials and employees. The ban on CDA officials holding a position in a
cooperative as provided in RA No. 6938 should be taken for what it is, that is, it is a prohibition in
addition to those provided in RA No. 6713. While it is true that RA No. 6983 allows CDA officials and
employees to become members of the cooperative and enjoy privileges attendant to its membership,
the law should not be taken as creating in favor of CDA officials and employees an exemption from
coverage of Section 7(d) of RA No. 6713, considering that the rights and privileges accorded to
members of cooperative are not confined solely to availing loans.
2. NO. Under Section 7(d) of RA No. 6713, solicitation of loan in the course of official duties of
public officers or employees is a prohibited act or transactions. Said section is a malum prohibitum;
therefore, the commission of the act determines whether or not the provision has been violated, and
not the character thereof. It is immaterial whether Villanueva has fully paid her loans since the law
prohibits the mere act of soliciting loan. Neither is undue influence on Villanueva’s part nor the used
of position or authority as CDA official is required to be proven in determination of her administrative
liability.
OFFICE OF THE ADMINISTRATIVE SERVICES, OFFICE OF THE COURT ADMINISTRATOR v.

LEDA URI
A.M. No. P-10-2852, 27 July 2011, SECOND DIVISION (Brion, J.)
Moral obligations, performance of household chores, traffic problems, health conditions,

domestic and financial concerns are not sufficient reasons to excuse habitual tardiness.
The Leave Division of the Office of Court Administrator (OCA) reported on the tardiness
incurred by Leda Uri (Uri), Court Stenographer I. The report showed that Leda was tardy 13 times in
July 2009 and 10 times in August 2009. Uri did not deny her tardiness, but she explained that due to
transfer of residence, traffic problems, domestic and financial problems, she was late by one or two
minutes for many times. Uri also apologized for her tardiness and understood that there was penalty
for it. OCA found Uri’s explanation without merit.It recommended that Uri be reprimanded for
habitual tardiness with a warning that repetition of the same will warrant more severe penalty.
ISSUE:
Whether or not Uri’s explanation can justify her habitual tardiness
RULING:
NO. The Court adopted OCA’s finding that Uri’s explanation does not merit consideration to
justify her habitual tardiness. Moral obligations, performance of household chores, traffic problems,
health conditions, domestic and financial concerns are not sufficient reasons to excuse habitual
tardiness.While the Court recognized the fact the Uri has acknowledged her infraction and has felt
remorse for her tardiness, the Court finds Uri guilty of habitual tardiness. However, considering that
she has been in the service for 14 years and had been suspended without pay for a month for
tardiness in September and October 2009, severe reprimand is proper for the prior tardiness she
committed in the earlier months.
GOLDEN SUN FINANCE CORPORATION v. RICARDO ALBANO

A.M. No. P-11-2888, 27 July 2011, SECOND DIVISION (Brion, J.)
Sheriff’s duty to execute a writ is ministerial, and he is bound to perform only those tasks stated
under the Rules of Court and no more.
The Regional Trial Court (RTC) decided in favor of Golden Sun Finance Corporation (Golden
Sun) and issued a writ of replevin against a certain Reyes. However, Golden Sun found out that the
vehicle had already been levied upon by Ricardo Albano (Albano), Court Sheriff, by virtue of writ of
execution in a criminal case against Reyes. It was sold at public auction conducted by Albano. Golden
Sun averred that the levy and sale of vehicle by Albano was illegal. It claimed that Albano was
negligent when he levied upon the vehicle and proceeded with sale without looking into car’s
certificate of registration to determine whether it was encumbered or not. Albano, for his defense,
claimed that he had no knowledge that the car was encumbered because the said certificate was never
shown to him. He also had no knowledge that the car was the subject of a writ of replevin. He stressed
that he acted within the scope of his duty as sheriff when he enforced the writ of execution. The Office
of Court Administrator (OCA) recommended that Albano be administratively held liable for simple
neglect of duty.
ISSUE:
Whether or not there is sufficient basis to declare Albano administratively liable for simple
neglect of duty.
RULING:
NO. Albano is not guilty of administrative charges for negligence and grave misconduct. In
determining properties to be levied upon, the Rules of Court require the sheriff to levy only on those
properties of the judgment debtor which are not otherwise exempt from execution. For purposes of
levy, a property is deemed to belong to judgment debtor if he holds a beneficial interest in such
property. In mortgage, debtor retains beneficial interest notwithstanding encumbrance. Thus,
mortgaged property may still be levied upon by the sheriff to satisfy judgment debtor’s obligations.
In the present case, after ascertaining Reyes’ interest over the car, Albano properly enforced the levy
thereon an act that is in accordance with the Rules of Court. Therefore, it is irrelevant for Golden Sun
to argue that had Albano checked the car’s certificate of registration, he would have been aware of
the encumbrance. The encumbrance, until foreclosed, will not in any way exempt the property from
the levy. Even the pendency of the proceeding for replevin that Golden Sun instituted would not serve
to prevent Albano from levying on the car since Reyes’ default and Golden Sun’s right to foreclose still
had to be settled in a proceeding.
ADMINISTRATIVE LAW
BEATRIZ B. OÑATE v. SEVERINO G. IMATONG
A.M. No. P-11-3009, 16 November 2011, SECOND DIVISION (Sereno, J.)
The exacting standards of ethics and morality for court employees are required to maintain the
people’s faith in the courts as dispensers of justice whose image is mirrored by their actuations.
Severino G. Imatong (Imatong) is a junior process server at the Municipal Circuit Trial Court,
Piat, Cagayan. On the other hand, Beatriz Oñate is a widow and professor at the Cagayan State
University in Tuguegarao City. The wife of Imatong and the deceased husband of Oñate are siblings.
Imatong attended a wedding celebration near the house of Oñate. Since it was already late and there
was no available means of transportation going back to his home, Imatong went to Oñate’s house to
ask permission if he could spend the night. Oñate acceded and allowed him to sleep in the living room.
The next day, while Oñate was preparing herself for work, Imatong barged into her room, embraced
her, and kissed her while pushing her towards the bed. After the initial shock, Oñate fought back and
pushed him away. When Oñate was able to finally free herself, she shouted at Imatong. Imatong
backed off, and asked Oñate to keep what happened between them. Imatong then left. After he left,
Oñate sent a text message to Imatong’s wife asking the latter to come over so that Oñate could relate
to her the acts committed by Imatong. When the message was ignored, Oñate reported what
happened to the police.
Oñate filed a complaint-affidavit against Imatong charging him with misconduct, which
became the basis of a criminal case of attempted rape. The criminal case was dismissed by the
Prosecutor’s Office for lack of probable cause. The Office of the Court Administrator (OCA)
recommended to dismiss Oñate’s complaint. Later, the Supreme Court adopted the findings of the
OCA, and dismissed the complaint for lack of merit. In the meantime, the Prosecutor’s Office issued
another Resolution recalling its earlier Order and declared that there was probable cause against
Imatong, this time for the crime of acts of lasciviousness. Hence, Oñate moved for the reconsideration
of the Court’s earlier Resolution dismissing the administrative complaint against Imatong.
ISSUE:
Whether or not the motion for reconsideration must be granted.
RULING:
YES. The exacting standards of ethics and morality for court employees are required to
maintain the people’s faith in the courts as dispensers of justice whose image is mirrored by their
actuations. Simple misconduct has been defined as an unacceptable behavior that transgresses the
established rules of conduct for public officers. Imatong’s actions transgressed the norms of civility
expected of judicial officers, even in their private lives, and constitute simple misconduct that must
be squarely penalized. Although beso-beso or air kissing may be considered a standard greeting
between family members, what Imatong did was he not merely greeted his sister-in-law, but
encroached into the territory of unwarranted advances that offended acceptable standards of
decency. Regardless of whether it reached the level of criminal malice or lewdness, his conduct was
unbecoming a court personnel, upon whom is placed the heavy burden of moral uprightness.
LEAVE DIVISION-OAS, OFFICE OF THE COURT ADMINISTRATOR v. LARAINE I. CALINGASAN

A.M. No. P-11-3010, 23 November 2011, SECOND DIVISION (Sereno, J.)
Moral obligations, the performance of household chores, traffic problems, health conditions, and
domestic and financial concerns are not sufficient causes to excuse habitual tardiness.
In a report by the Chief of the Leave Division, Office of Administrative Services, Office of the
Court Administrator (OCA), it was found that Laraine I. Calingasan (Calingasan), Court Stenographer
II, Municipal Trial Court in Cities, Sta. Rosa City, Laguna had incurred a total of 38 times of tardiness
in the second semester of 2009. Hence, she was charged with habitutal tardiness. In her Comment,
Calingasan explained that her son underwent an operation on 12 August 2009. His operation obliged
her to clean his post-surgery wound every morning before going to the office until November 2009,
when the wound fully healed. She further claims that, from August 2009 to November 2009, she had
to accompany her son to the hospital several times for his medical checkup. For the month of
December 2009, the justification she gave for her absences was that she was suffering from
hypertension. On most mornings, she needed to take her medicine and wait for her blood pressure
to go down before going to work. The OCA recommended that Calingasan be reprimanded for her
first offense of habitual tardiness. She was also warned that a repetition of the same or a similar
offense in the future would be dealt with more severely by the Court.
ISSUE:
Whether or not the OCA’s recommendation was proper.
RULING:
YES. The Civil Service Commission (CSC), in its Memorandum Circular No. 23, Series of 1998,
promulgated the rules and guidelines on absenteeism and tardiness of public employees. It is clear
from the facts that Calingasan has been habitually tardy. Consequently, as an employee of the
judiciary, she failed to live up to the stringent standard of conduct demanded from everyone
connected with the administration of justice. The excuses offered by respondent are not the kind that
would justify her tardiness. The Court has previously held that moral obligations, the performance of
household chores, traffic problems, health conditions, and domestic and financial concerns are not
sufficient causes to excuse habitual tardiness. Since this is the first offense of Calingasan, the proper
sentence is a reprimand with a stern warning that a repetition of the same or a similar offense in the
future will be dealt with more severely.
ARTHUR M. GABON V. REBECCA P. MERKA, Clerk of Court II, Municipal Trial Court,
Liloan, Southern Leyte
A.M. No. P-11-3000, December 14, 2011, EN BANC (PER CURIAM)
All officials and employees involved in the administration of justice, from judges to the lowest
rank and file employees, bear the heavy responsibility of acting with strict propriety and decorum at all
times in order to merit and maintain the public's respect for, and trust in, the Judiciary.
Complainant Arthur M. Gabon charged the respondent with Grave Misconduct (1) for writing
eight demand letters in 1993 in behalf of the Saint Ignatius Loyola Credit Cooperative, Inc., Simeon C.
Maamo, Jr. and Restituta Claridad using the MTCs official letterhead and signing the same letters in
her official capacity as the Clerk of Court of the MTC of Liloan, Southern Leyte; and (2) for
administering oaths in five affidavits and a Kasabutan (Agreement) in 1995 and 2000 that had no
relation with her official duties. The respondent admitted the charge of using the MTCs official
letterhead and signing the demand letters in her official capacity, but explained that she acted in good
faith to aid in declogging court dockets. She insisted that she was duly authorized to administer oaths
under Section M, Chapter VIII of the Manual for Clerks of Court and that she did not abuse the franking
privilege of the court in sending the letters as these letters were in representation of the court. She
averred that the complaint was a harassment suit because she committed the acts complained of 15
or 17 years ago.The complainant argued that the respondent acted like the counsel of a private party
in writing the demand letters and that the respondents authority to administer oaths extended only
to cases filed or pending in her assigned court.
ISSUE:
Whether or not Merka is guilty of grave misconduct.
RULING:
YES. Misconduct in office refers to "any unlawful behavior by a public officer in relation to
the duties of his office, willful in character. The term embraces acts which the office holder had no
right to perform, acts performed improperly, and failure to act in the face of an affirmative duty to
act." In grave misconduct, as distinguished from simple misconduct, the elements of corruption, clear
intent to violate the law, or flagrant disregard of established rule must be manifest. Corruption as an
element of grave misconduct consists in the act of an official or employee who unlawfully
or wrongfully uses his station or character to procure some benefit for himself or for another,
contrary to the rights of others, as in this case. By her repeated abuse and misuse of authority, the
respondent exhibited an obvious lack of integrity expected of a court employee. Grave misconduct is
a serious offense punishable, under Section 52 of the Revised Uniform Rules on Administrative Cases
in the Civil Service, with dismissal even for the first offense.
All officials and employees involved in the administration of justice, from judges to the lowest
rank and file employees, bear the heavy responsibility of acting with strict propriety and decorum at
all times in order to merit and maintain the public's respect for, and trust in, the Judiciary. Simply
stated, all court personnel must conduct themselves in a manner exemplifying integrity, honesty and
uprightness. In this case, the respondent's use of the letterhead of the court and of her official
designation in the eight demand letters she prepared in 1993 hardly meets the foregoing standard.
She took advantage of her office and position to advance the interests of private individuals, acting
as counsel and collecting agent for the Saint Ignatius Loyola Credit Cooperative, Inc., Simeon C.
Maamo, Jr., and Restituta Claridad. Despite her good intentions, she gave private individuals an
unwarranted privilege at the expense of the name of the court.
The respondent also administered oaths in documents not involving official business, in
violation of the Revised Administrative Code, in relation with the Manual for Clerks of Court. Under
these provisions, Clerks of Court are notaries public ex officio; they may notarize documents or
administer oaths only when the matter is related to the exercise of their official functions. Thus, in
their ex-officio capacity, clerks of court should not take part in the execution of private documents
bearing no relation at all to their official functions. The respondent administered oaths in five
affidavits and a document bearing no relation at all to her official functions.
ATTY. LETICIA E. ALA v. JUDGE SOLIVER C. PERAS, et al.

A.M. No. RTJ-11-2283, 16 November 2011, THIRD DIVISION (Mendoza, J.)
An administrative complaint is not the appropriate remedy for every act of a judge deemed
aberrant or irregular where a judicial remedy exists and is available, for if subsequent developments
prove the judges challenged act to be correct, there would be no occasion to proceed against him at all.
Atty. Leticia E. Ala (Atty. Ala) was the counsel of Adelaida Alba-Chua in a case for declaration
of nullity of marriage at the Regional Trial Court (RTC), Branch 107, Quezon City. Atty. Ala was
replaced as counsel but recognized as Intervenor in the said case. A partial judgment based on
compromise was rendered regarding the properties of the spouses. It was agreed that Benson Go
Chua (Chua) would assume the payment of Atty. Ala’s professional fee as Mrs. Chua’s counsel. Atty.
Ala filed a motion for execution of the partial judgment. A writ of execution was issued in favor of
Atty. Ala for P3,015,203.67. The writ was partially implemented with the delivery of the amount of
P164,000.00 to Atty. Ala as partial payment of her professional fee. To satisfy the remaining balance
of Atty. Ala’s professional fee, Sheriff Caballes of the RTC of Cebu City levied on the conjugal home of
the spouses.
Before the scheduled public bidding auction of the conjugal home, a case was filed by VTL
Realty Corporation (VTL) against Atty. Ala to enjoin the public auction set on November 9, 2006 on
the ground that the conjugal home was no longer owned by Chua but by VTL, as it had been the
subject of a foreclosed mortgage sold by Metrobank to VTL. A TRO was issued. Upon expiration of the
TRO, the subject property was sold and awarded to Atty. Ala as the highest bidder. Hence, Atty. Ala
filed a motion to dismiss the case filed by VTL against her by virtue of the result of the public bidding,
but this was denied. A preliminary injunction was issued in favor of VTL to enjoin the issuance of a
new TCT in favor of Atty. Ala.
Proceeding from the said facts, Atty. Ala filed the instant administrative case against the
judges and the clerk of court of the RTC of Cebu City who had handled and/or resolved the cases Atty.
Ala has filed and/or is involved with. These are Judges Peras, Dumdum, Jr., and Labra; and Clerk of
Court Joaquino. She also filed the instant administrative case against the sheriffs involved in the
execution of the judgment of the said cases. These sheriffs are Sheriff Caballes and Sheriff Viovicente,
Jr. The Office of the Court Administrator (OCA) recommended that the administrative complaints
against Judges Peras, Dumdum, and Labra be dismissed for being judicial in nature; that Clerk of
Court Joaquino be suspended for 30 days without pay for neglect of duty and for failure to promptly
act on letters and requests, and sternly warned that a repetition of the same or similar act shall be
dealt with more severely; the adiministrative complaints against Sheriffs Caballes and Viovicente be
dismissed but they be reminded to be more circumspect in the performance of their duties.
ISSUE:
Whether or not the instant administrative complaint is meritorious.
RULING:
NO.
Judges Peras, Dumdum, and Labra
A review of the records shows that Atty. Ala failed to timely raise her concerns in an
appropriate judicial proceeding. Until and unless there is an authoritative pronouncement that the
questioned orders of the Judges were indeed tainted by anomaly, there would be no ground to
prosecute the respondent Judges, either administratively or criminally, for rendering them. Thus, an
administrative complaint is not the appropriate remedy for every act of a judge deemed aberrant or
irregular where a judicial remedy exists and is available, for if subsequent developments prove the
judges challenged act to be correct, there would be no occasion to proceed against him at all. Thus,
the charges being judicial in nature, the remedy of Atty. Ala should have been with the proper court
for the appropriate judicial action and not with the OCA by means of an administrative complaint.
For Atty. Ala’s failure to exhaust judicial remedies, to prove malice and bad faith, and to substantiate
her other allegations by substantial evidence, the administrative complaint against the Judges should
be dismissed.
Clerk of Court Joaquino
On his failure to officially respond to Atty. Ala’s various formal inquiries regarding the
injunction bond, Clerk of Court Joaquino’s claim to have orally answered Atty. Ala’s formal queries
when she visited the Office of the Clerk of Court (OCC) cannot exonerate him, as a verbal reply to a
formal and written inquiry is not sufficient. Anent the charge of condoning the inefficiencies of Sheriff
Caballes, Clerk of Court Joaquino admitted that he could not monitor all 28 sheriffs of the RTC of Cebu
City, thus, he relied on reports from the parties or their counsels regarding each sheriff’s
performance. This cannot excuse him from the duty of supervising his personnel at the OCC. As Clerk
of Court, it is his duty to plan, direct, supervise, and coordinate sheriff’s activities of all
division/sections/units in the OCC. It is clear that Clerk of Court Joaquino was remiss in the
performance of his duties. The Court, thus, found the penalty of reprimand to be appropriate under
the circumstances.
Sheriff Caballes
In this case, Sheriff Caballes showed that he acted promptly in the implementation of the writ.
Nevertheless, he failed in his duty to furnish the complainant a copy of the Sheriff’s Report in
accordance with Section 14 of Rule 39 of the Rules of Court. In accordance with Rule IV, Section
52(B)(1) of the Uniform Rules on Administrative Cases in the Civil Service, he should be held liable
for Simple Neglect of Duty. Considering, however, that it is his first administrative offense and that
such was unintentional, Sheriff Caballes should be admonished and sternly warned that the same or
similar act of negligence shall be dealt with more severely.
Sheriff Viovicente
Instead of ensuring that the copy of the writ was indeed mailed, Sheriff Viovicente simply
assumed so. For this, he should be reminded to be more circumspect in the performance of his duties
as the conduct and behavior of every one connected with an office charged with the dispensation of
justice, from the presiding judge to the lowest clerk, are circumscribed with the heavy burden of
responsibility. Their conduct, at all times, must not only be characterized by propriety and decorum,
but above all, be beyond suspicion.
FRANCISCO C. TAGUINOD v. ROLANDO TOMAS

A.M. No. P-09-2660, 29 November 2011, EN BANC (Per Curiam)
Indeed, the rule in criminal proceedings treating confessions as mitigating circumstance finds
no rigorous application in administrative proceedings where the respondent, unlike the accused, stands
to lose neither liberty nor property but a public trust to render service, a privilege burdened with
numerous prohibitions such as those Tomas violated.
This administrative matter is an offshoot of the Court’s ruling in Taguinod v. Madrid, which,
held the judge in the Regional Trial Court of Santiago City, Branch 21 (Branch 21), administratively
liable for violating Section 2 of PD 1079 on the publication of judicial notices. The Court also ordered
therein the investigation of that court’s deputy sheriff, Rolando Tomas (Tomas), for “possible
violation of Section 5” of PD 1079. Francisco Taguinod (Taguinod), publisher and editor of City Star,
a newspaper locally published in Santiago City, and another individual initiated in Taguinod v. Madrid
an administrative complaint against Branch 21’s presiding judge for irregularities in the allocation of
judicial notices for publication by local publishers. In the course of the investigation by the Office of
the Court Administrator (OCA), Taguinod presented documentary evidence showing receipt by
Tomas of sums of money from March to November 1996 in exchange for City Star’s publication of
judicial notices. At that time, City Star was not yet accredited by Branch 21. As Tomas was not
impleaded as party in Taguinod v. Madrid, the OCA recommended Tomas’ separate investigation.
In his comment to the charge, Tomas readily admitted receiving payments from Taguinod in
exchange for City Star’s publication of judicial notices. By way of defense, Tomas qualified that he
“never demanded any money” from Taguinod. The OCA investigator found Tomas liable for violating
Section 5 of PD 1079 and Section 2,7 Canon 1 of the Code of Conduct for Court Personnel (Code of
Conduct) and recommended respondent’s suspension from service for six months. In its evaluation
of the investigator’s report, the OCA recommended holding Tomas liable for Grave Misconduct and
Dishonesty for which he should be suspended from service for the period of six months.
ISSUE:
Whether or not Tomas is guilty of grave misconduct and dishonesty.
RULING:
YES. Section 5 of PD 1079 regulates the conduct of both the members of local media and lower
court personnel on the awarding of judicial notices for publication. Just as the former are prohibited
from “offer[ing] or giv[ing] money, commission or gift of any kind” to lower court judges and
personnel for the privilege of publishing judicial notices, so are the latter barred from “directly or
indirectly demand[ing] of or receiv[ing] x x x money, commission or gifts of any kind” for the same
purpose. The scope of prohibition on the part of the court personnel is broad, covering both demand
or receipt of payoffs.
By accepting pay-offs from Taguinod, Tomas also violated Section 2(e), Canon III of the Code
of Conduct. The 10 checks Taguinod issued and Tomas received speak volumes of this convenient,
albeit unethical, arrangement. Section 2 (e), Canon III of the Code of Conduct was crafted precisely to
punish court personnel who engage in such practices. Tomas’ violation of Section 5 of PD 1079 and
Section 2(e), Canon III of the Code of Conduct constitutes grave misconduct or corrupt conduct in
flagrant disregard of well-known legal rules. Tomas, who entered the judiciary in 1996, ought to
know these provisions; his multiple transactions with Taguinod show flagrant disregard of their
proscriptions. Under Section 52 of the Uniform Rules on Administrative Cases in the Civil Service
(Uniform Rules), dishonesty and grave misconduct are classified as grave offenses meriting the
penalty of dismissal from service. Indeed, the rule in criminal proceedings treating confessions as
mitigating circumstance finds no rigorous application in administrative proceedings where the
respondent, unlike the accused, stands to lose neither liberty nor property but a public trust to render
service, a privilege burdened with numerous prohibitions such as those Tomas violated.
CONCERNED CITIZEN v. MARIA CONCEPCION M. DIVINA

A.M. No. P-07-2369, 16 November 2011, THIRD DIVISION (Mendoza, J.)
Although the Court is solicitous of the plight of court stenographers, being saddled with heavy
workload is not compelling reason enough to justify failure to faithfully comply with the prescribed
period provided in Administrative Circular No. 24-90.
Concepcion M. Divina (Divina) is a Court Stenographer of the Regional Trial Court of Balanga
City, Bataan, Branch 3 (RTC). Divina is herein charged with 3 different offense filed by 3 different
complainants. The anonymous complaint filed by the “Concerned Citizen” alleged that Divina
demanded P20,000.00 from them in exchange for the Transcript of Stenographic Notes of their case.
Divina allegedly threatened them that if they failed to give her money, she would not prepare the
Transcript of Stenographic Notes (TSN) they were requesting, which would result in the delay in the
disposition of their case. On the other hand, Atty. Teodoro O. Camacho III (Atty. Camacho)’s complaint
stemmed from a verbal row he had with Divina at the lawyer’s table while a hearing was going on.
Atty. Camacho alleged that Divina showed belligerent attitude towards him. Prior to the incident,
Atty. Camacho had repeatedly requested for the TSN from Divina who promised to give him a copy
few days before the scheduled hearing. Finally, Ricardo M. Ricardo (Ricardo) was the petitioner in a
case for annulment of marriage. Ricardo’s complaint is for the delay in the submission of TSN. To
secure a TSN, Divina asked money from him and he gave her P100.00. Before the date of the hearing
wherein he would present the psychologist, Ricardo asked about the transcript, but he was told by
Divina that, “Marami pa akong ginagawa at marami pang nakapila, kaya di ko pa magawa.” The next
time Divina asked money from him, he readily gave her P500.00 although he was aware that the
transcript costs only P10.00 per page.
When the investigating judge (Judge Escalada) conducted an inventory of the docket folders,
he discovered that Divina had a backlog of untranscribed stenographic notes as far back as 2001.
Judge Escalada found Divina liable for violation of Section 11 of Rule 141. However, he absolved
Divina of the extortion charge by the “Concerned Citizen” and charge of belligerent attitude by Atty.
Camacho. The Office of the Court Administrator (OCA) adopted the findings of Judge Escalada. It
recommended instead, a penalty of suspension from service for one (1) year without pay.
ISSUE:
Whether or not Divina is guilty of the charges against her.
RULING:
NO. In the present case, there is no sufficient, clear and convincing evidence to hold Divina
administratively liable for Gross Misconduct as charged in the undated anonymous letter. It bears to
point out that the author of the undated anonymous letter never came out in the open to testify before
the Investigating Judge to support his claim that Divina had engaged in an illegal activity to make
money out of a case pending before the RTC. The charge of belligerent/arrogant behavior against
Divina must likewise fail. Records has revealed that the testimony of Atty. Camacho is inadequate to
establish his claim and to hold her liable for misconduct. To the mind of the Court, Divina’s conduct
was not of such deplorable and contemptible nature that would serve as valid basis to slap her with
an administrative and disciplinary sanction in view of the facts obtaining in this case. Meanwhile, the
accusation of extortion by Ricardo against Divina is bereft of merit and, hence, must also be
dismissed. The charge of extortion is a factual matter which must be established and proved with
sufficient competent evidence. No clear and solid proof was offered by Ricardo to show that Divina
demanded money from him in exchange for immediate preparation of his TSN.
The records, however, are replete with evidence clearly showing that Divina is less than
zealous in the performance of her official duties as court stenographer. As such, she failed to live up
to the standard of efficiency and professionalism that the Judiciary demands from its court personnel.
For one, Divina failed to strictly follow Administrative Circular No. 24-90 that prescribes the time for
completion and submission of TSN. The Court cannot turn a blind eye on Divina’s clear violation of
the foregoing circular which is evident from the open court orders given by Judge Escalada, Presiding
Judge of RTC, Balanga City, Branch 3.
Although the Court is solicitous of the plight of court stenographers, being saddled with heavy
workload is not compelling reason enough to justify Divina’s failure to faithfully comply with the
prescribed period provided in Administrative Circular No. 24-90 and, thus, she must be faulted.
Otherwise, every government employee charged with inefficiency would resort to the same
convenient excuse to evade punishment, to the great prejudice of public service. Neither does the
above justification proffered by Divina constitute as sufficient excuse for her not to remit a portion
of her collection from Ricardo for requests of copies of the TSN in the total amount of P600.00. Section
11, Rule 141 of the Rules of Court clearly provides that payment for requests of copies of the TSN
shall be made to the Clerk of Court, and that a third of the portion of such payment accrues to the
Judicial Development Fund (JDF), with only two-thirds thereof to be paid to the stenographer
concerned. Thus, a stenographer is not entitled to the full amount of the TSN fees. Payment likewise
cannot be made to her as the payment is an official transaction that must be made with the Clerk of
Court.
METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM v. GABRIEL ADVINCULA, et al.

G.R. No. 179217, 2 February 2011, SECOND DIVISION (Carpio, J.)
Taking into consideration the provisions of both RA 1616 and MC No. 26-96, the separation
benefit due to the affected employees should be the balance received in MC No. 26-96 and the retirement
benefit received in RA 1616.
When the Metropolitan Waterworks and Sewerage System (MWSS) was reorganized, MWSS
offered separation benefits to its official and employees through the Revised Early Retirement
Incentive Package (ERIP I). MWSS Memorandum Circular (MC) Nos. 26-96, 26-96(b), 26-96(c) and
26-96(d) governed the implementation of ERIP I. Later, MWSS entered into concession agreements
with Maynilad Water Services, Inc. and Manila Water Company, Inc. for the privatization of its
waterworks and sewerage systems. On account of the privatization, MWSS again offered a retirement
plan called Early Retirement Incentive Package II (ERIP II) to around 5,000 of its employees who
would be affected or terminated if they were not absorbed by the concessionaires. Gabriel Advincula,
et al. subsequently filed a petition for mandamus alleging that MWSS did not pay them the full amount
of separation benefit they were entitled to.
The Regional Trial Court (RTC) granted the issuance of the writ of mandamus. Upon appeal
to the Court of Appeals (CA), it affirmed with modification the decision of the RTC. The CA ordered
that MWSS pay “the balance of the ERIP separation pay in the amount equivalent to 0.5 per year times
BMP (basic monthly pay) only to the following employees who retired in 1997 under ERIP II, to wit:
(1) employees who have rendered less than fifteen (15) years of service provided they were not
excluded by paragraph 1, MC No. 26-96(c), and provided further, that they were not absorbed by the
private concessionaires during the reorganizations; and (2) those who have served for more than
thirty (30) years.”
MWSS assails the decision of the CA in ruling that an employee who has served for more than
30 years is entitled to the same benefit of 0.5 month salary for every year of service. Citing MC No.
26-96(b), MWSS explained that those who have served for more than 30 years are entitled to 2.5
month salary for every year of service. In the 2.5 month salary computation, 1 month had already
been paid by MWSS while the other month was covered by RA 1616. Meanwhile, the remaining
balance of 0.5 is not mandatory because it is dependent on whether the employee had been absorbed
by the private concessionaire or actually resigned from the service.
ISSUE:
Whether or not the CA erred in allowing the writ of mandamus against MWSS commanding
it to pay the balance of 0.5 month salary for every year of service of unpaid separation benefits to
those employees who have served for more than 30 years and retired in 1997 under ERIP II.
RULING:
NO. It is undisputed that Advincula, et al. were all qualified to retire under RA 1616 at the
time of the reorganization and privatization of MWSS in 1996 and 1997. It is clear from the provision
that an employee who has rendered at least 20 years of service may retire under RA 1616 and receive
a retirement gratuity of 1 month salary for every year of service. MC No. 26-96, on the other hand,
provides for the computation of the separation benefit applicable to permanent officials who are not
qualified to retire under any existing law and those who are qualified to retire. Those who are not
qualified to retire, for as long as they served for more than a year, may avail of the gratuity
corresponding to their length of service. As for those employees who are qualified to retire, they may
only receive a separation pay equivalent to the difference between the incentive package and the
retirement benefit under any existing retirement law.
Taking into consideration the provisions of both RA 1616 and MC No. 26-96, the separation
benefit due to the affected employees should be the balance received in MC No. 26-96 and the
retirement benefit received in RA 1616. Hence, those who have rendered at least 20 but less than 30
years of service should receive 1 month salary for every year of service; and those who have rendered
more than 30 years should receive 1.5 month salary for every year of service.
In the present case, MWSS already gave the affected employees under ERIP II, regardless of
the length of service, a separation benefit equivalent to 1 month salary for every year of service. Thus,
those employees who have rendered at least 20 but less than 30 years of service already received the
payment due them. However, MWSS is still obligated to pay those affected employees who have
rendered more than 30 years for the balance of 0.5 month salary for every year of service. The
reasoning forwarded by MWSS that the remaining balance of 0.5 is not mandatory but is still
dependent on whether the employee had been absorbed by the private concessionaire or actually
resigned from the service only applies to those employees who have served less than 15 years.
GREGORIO R. VIGILAR, SECRETARY OF THE DEPARTMENT OF PUBLIC WORKS AND
HIGHWAYS (DPWH), et al. v. ARNULFO D. AQUINO
G.R. No. 180388, 18 January 2011, EN BANC (Sereno, J.)
The doctrine of exhaustion of administrative remedies and the doctrine of primary jurisdiction
are not ironclad rules. They admit of exceptions such as estoppel and lack of jurisdiction, among others.
Twaño, officer in charge District Engineer of DPWH 2nd Engineering District of Pampanga,
sent an invitation to bid to Aquino, owner of A.D. Aquino Construction and Supplies, to bulldoze a
part of the Porac River in Guagua, Pampanga and to thereafter build a dike. The Contract of
Agreement was awarded to Aquino for PhP1,873,790.69, to cover the project cost. When Aquino
completed the project, a Certificate of Project Completion was issued, with Yumul, Project Engineer;
Supan, Chief of the Construction Section; and Twaño as signatories. But Aquino claimed that
PhP1,262,696.20 was still due him, so Aquino instituted a complaint for collection of sum of money
with damages against Twaño et al. before the Regional Trial Court (RTC) of Guagua.
Twaño et al. asserted that the case was against the state, and that Aquino failed to exhaust
administrative remedies. The RTC ruled in favor of Aquino, but the Court of Appeals (CA) reversed
and set aside the judgment, declaring the Contract of Agreement null and void. It also ordered the
Commission on Audit to dispatch the amount on a quantum meruit basis for Aquino’s completion of
the project.
ISSUE:
Whether or not the CA was correct in admitting Aquino’s suit even though he did not exhaust
administrative remedies.
RULING:
YES. Petitioners’ claim that the Complaint filed by respondent before the Regional Trial Court
was done without exhausting administrative remedies. Petitioners aver that respondent should have
first filed a claim before the Commission on Audit (COA) before going to the courts. However, it has
been established that the doctrine of exhaustion of administrative remedies and the doctrine of
primary jurisdiction are not ironclad rules. In Republic of the Philippines v. Lacap, this Court
enumerated the numerous exceptions to these rules, namely: (a) where there is estoppel on the part
of the party invoking the doctrine; (b) where the challenged administrative act is patently illegal,
amounting to lack of jurisdiction; (c) where there is unreasonable delay or official inaction that will
irretrievably prejudice the complainant; (d) where the amount involved is relatively so small as to
make the rule impractical and oppressive; (e) where the question involved is purely legal and will
ultimately have to be decided by the courts of justice; (f) where judicial intervention is urgent; (g)
where the application of the doctrine may cause great and irreparable damage; (h) where the
controverted acts violate due process; (i) where the issue of non-exhaustion of administrative
remedies has been rendered moot; (j) where there is no other plain, speedy and adequate remedy;
(k) where strong public interest is involved; and (l) in quo warranto proceedings. In the present case,
conditions (c) and (e) are present.
The government project contracted out to respondent was completed almost two decades
ago. To delay the proceedings by remanding the case to the relevant government office or agency will
definitely prejudice respondent. More importantly, the issues in the present case involve the validity
and the enforceability of the "Contract of Agreement" entered into by the parties. These are questions
purely of law and clearly beyond the expertise of the Commission on Audit or the DPWH.
OFFICE OF THE OMBUDSMAN v. COURT OF APPEALS and DINAH C. BARRIGA

G.R. No. 172224, 26 January 2011, SECOND DIVISION (Carpio, J.)
An appeal of the decision of the Ombudsman to the Court of Appeals shall not stop the decision
from being executory and the implementation of the decision follows as a matter of course.
Sonia Q. Pua (Pua) filed a complaint with the Office of the Deputy Ombudsman alleging that
Virgilio E. Villamor (Villamor), Dinah C. Barriga (Barriga), and Bebelia C. Bontia, all public officials of
Carmen, Cebu, entered into several anomalous transactions in their official capacity. The Office of the
Deputy Ombudsman found Barriga guilty of misconduct and imposed a penalty of six months
suspension from service; meanwhile, the complaints against Villamor and Bontia were dismissed for
being moot and academic, as they were already dismissed from service. The Office of the
Ombudusman (Ombudsman) modified the ruling of the Office of the Deputy Ombudusman, and found
her guilty of conduct prejudicial to the best interest of the service and imposed on her a penalty of
suspension for one year. Barriga appealed the decision all the way to the Supreme Court, but the
appellate courts ultimately affirmed the Ombdusman's decision finding her liable.
Pending Barriga's appeal, the Ombudsman ordered the municipal mayor of Carmen, Cebu to
implement its decision. It also denied Barriga's request to hold the implementation of the penalty of
suspension in abeyance pending the issuance of the entry of judgment of the Supreme Court. Barriga
challenged this action of the Ombudsman before the Court of Appeals (CA). The latter agreed with
her and explained that its acts went beyond mere recommendation and rather imposed on the mayor
to implement the order of suspension, which run counter to its authority.
ISSUE:
Whether the Ombudsman may order the immediate implementation of the penalty of
suspension of Barriga, even pending appeal.
RULING:
YES. Section 7, Rule III of Administrative Order No. 7, as amended, provides that an appeal of
the decision of the Ombudusman shall not stop the decision from being executory, as the decision of
the Ombudsman shall be executed as a matter of course. As such, while an appeal to the CA may be
made, such appeal shall not stop the decision from being executory and the implementation of the
decision follows as a matter of course. Thus, the Ombudsman’s order imposing on Barriga the penalty
of suspension from office for one year without pay is immediately executory even pending appeal in
the Court of Appeals.
THE BOARD OF TRUSTEES OF THE GOVERNMENT SERVICE INSURANCE SYSTEM, AND

WINSTON F. GARCIA v. ALBERT M. VELASCO AND MARIO L. MOLINA
Preventive suspension pending investigation is not a penalty. It is a measure intended to enable

the disciplining authority to investigate charges against respondent by preventing the latter from
intimidating or in any way influencing witnesses against him.
Albert Velasco and Mario Molina were charged by the Government Service Insurance System
(GSIS) with grave misconduct and were preventively suspended for 90 days. Pending his
administrative case, Molina requested that the GSIS Senior Vice President implement of his step
increment. It was denied citing Board Resolution No. 372 which contains the new GSIS salary
structure, its implementing rules and regulations, and the adoption of the supplemental guidelines
on step increment and promotion. The resolution provides “3. The step increment adjustment of an
employee who is on preventive suspension shall be withheld until such time that a decision on the case
has been rendered.” Board Resolution No. 197 was also issued which states that an employee with a
pending administrative case is disqualified from being promoted.
Velasco and Molina then filed a petition for prohibition with a writ of preliminary injunction
against the Board of Trustees of GSIS to stop the implementation of the subject board resolutions.
They claimed that they were being denied the benefits to which they are entitled to, and that such
denial violates their right to be presumed innocent and that they are being punished without the
benefit of a hearing. The Regional Trial Court (RTC) granted Velasco and Molina’s petition for
prohibition and declared the 2 board resolutions as void.
ISSUE:
Whether or not Velasco and Molina are entitled to a step increment notwithstanding the
pendency of the administrative cases against them.
RULING:
YES. A grant of step increment on the basis of length of service requires that an employee
must have rendered at least three years of continuous and satisfactory service in the same position
to which he is an incumbent. To determine whether service is continuous, it is necessary to define
what actual service is. Actual service refers to the period of continuous service since the appointment
of the official or employee concerned, including the period or periods covered by any previously
approved leave with pay. While there are no specific rules on the effects of preventive suspension on
step increment, we can refer to the Civil Service Commission (CSC) rules and rulings on the effects of
the penalty of suspension and approved vacation leaves without pay on the grant of step increment
for guidance. Section 56(d), Rule IV of the Uniform Rules on Administrative Cases in the Civil Service
provides:
“Section 56. Duration and effect of administrative penalties. - The following rules shall
govern in the imposition of administrative penalties: x x x
(d) The penalty of suspension shall result in the temporary cessation of work for a
period not exceeding one (1) year.”
If an employee is suspended as a penalty, it effectively interrupts the continuity of his

government service at the commencement of the service of the said suspension. The grant of step
increment will only be delayed by the same number of days that the employee was under suspension.
Consequently, an employee who was preventively suspended will still be entitled to step increment
after serving the time of his preventive suspension even if the pending administrative case against
him has not yet been resolved or dismissed. The grant of step increment will only be delayed for the
same number of days, which must not exceed 90 days, that an official or employee was serving the
preventive suspension.
Preventive suspension pending investigation is not a penalty. It is a measure intended to

enable the disciplining authority to investigate charges against respondent by preventing the latter
from intimidating or in any way influencing witnesses against him. If the investigation is not finished
and a decision is not rendered within that period, the suspension will be lifted and the respondent
will automatically be reinstated. The trial court was correct in declaring that respondents had the
right to be presumed innocent until proven guilty. This means that an employee who has a pending
administrative case filed against him is given the benefit of the doubt and is considered innocent until
the contrary is proven. In this case, respondents were placed under preventive suspension for 90
days beginning on 23 May 2002. Their preventive suspension ended on 21 August 2002. Therefore,
after serving the period of their preventive suspension and without the administrative case being
finally resolved, respondents should have been reinstated and, after serving the same number of days
of their suspension, entitled to the grant of step increment.
OFFICE OF THE DEPUTY OMBUDSMAN FOR LUZON v. JESUS D. FRANCISCO

G.R. No. 172553, 14 December 2011 FIRST DIVISION (LEONARDO – DE CASTRO, J.)
Preventive suspension is merely a preventive measure, a preliminary step in an administrative

investigation; the purpose thereof is to prevent the accused from using his position and the powers and
prerogatives of his office to influence potential witnesses or tamper with records which may be vital in
the prosecution of the case against him.
Jesus Francisco is charged with the violation of Anti-Corrupt and Graft Practices Act during
his tenure as a member of the awards and bids committee. The complaint stated, among others, that
when the Municipality of Bacoor conducted its prequalification of documents and bidding, St.
Marthas Trading and General Contractors license was not renewed. Furthermore, the said contractor
was allegedly not qualified to undertake the construction of the P9.5 million project as it can only
enter into a contract for a project that is worth P3 million or less. The complaint likewise sought to
place the aforementioned individuals under preventive suspension pending the investigation of the
case. He was ordered to be preventively suspended from his job to which he desisted since it was
prejudicial to the public interest and that the charges against him was not substantively presented to
show that he caused injury against the State.
ISSUE:
Whether or not the preventive suspension should lie against Jesus Francisco.
RULING:
YES. Preventive suspension is merely a preventive measure, a preliminary step in an

administrative investigation; the purpose thereof is to prevent the accused from using his position
and the powers and prerogatives of his office to influence potential witnesses or tamper with records
which may be vital in the prosecution of the case against him. Moreover, the case has been rendered
moot when the Ombudsman has issued a Joint Resolution that drops the charges against Francisco,
making preventive suspension futile.
PHILIPPINE NATIONAL RAILWAYS v. KANLAON CONSTRUCTION ENTERPRISES CO., INC.

G.R. No. 182967, 6 April 2011, SECOND DIVISION (Carpio, J.)
The Administrative Code of 1987 expressly prohibits the entering into contracts involving the
expenditure of public funds unless two prior requirements are satisfied. First, there must be an
appropriation law authorizing the expenditure required in the contract. Second, there must be attached
to the contract a certification by the proper accounting official and auditor that funds have been
appropriated by law and such funds are available. Failure to comply with any of these two requirements
renders the contract void.
In 1990, Philippine National Railways (PNR) and Kanlaon Construction Enterprises Co.,
(Kanlaon) entered into contracts for the repair of three PNR station buildings and passenger shelters,
namely: 1) College Station for P2,316,568.41; 2) Bian Station for P2,547,978.63; and
3) Buendia Station for P1,820,534.40. The total cost of the three projects was P6,685,081.44. By
November 1990, Kanlaon alleged that it had already completed the three projects.
In 1994, Kanlaon sent a demand letter to PNR requesting for the release of the retention
money in the amount of P333,894.07. PNR denied Kanlaon’s demand because of the Notices of
Suspension issued by the Commission on Audit (COA). Subsequently, Kanlaon filed a complaint for
collection of sum of money plus damages against PNR. Kanlaon sought to recover from PNR a total
of P865,906.79 consisting of the remaining balance of the three projects in the amount
of P531,652.72 and the retention money in the amount of P334,254.07. In its amended
complaint, Kanlaon impleaded the COA. In its answer, PNR admitted the existence of the three
contracts but alleged that Kanlaon did not comply with the conditions of the contract. PNR also
alleged that Kanlaon did not complete the projects and that PNR did not have any unpaid balance.
PNR added that it had a valid ground to refuse the release of the retention money because of the COA
orders suspending the release of payment to Kanlaon. The trial court ruled in favor of Kanlaon. On
appeal, the Court of Appeals affirmed the trial courts decision.
ISSUE:
Whether PNR is liable to Kanlaon.
RULING:
NO. The Court notes that one of the reasons the COA issued the Notices of Suspension was
because the contracts did not contain a Certificate of Availability of Funds as required under Sections
85 and 86 of Presidential Decree No. 1445. Kanlaon does not dispute the absence of a Certificate of
Availability of Funds. The Administrative Code of 1987 expressly prohibits the entering into
contracts involving the expenditure of public funds unless two prior requirements are satisfied. First,
there must be an appropriation law authorizing the expenditure required in the contract. Second,
there must be attached to the contract a certification by the proper accounting official and auditor
that funds have been appropriated by law and such funds are available. Failure to comply with any
of these two requirements renders the contract void.
COURT OF APPEALS BY: COC TERESITA R. MARIGOMEN v. ENRIQUE E. MANABAT, JR.
A.M. No. CA-11-24-P, 16 November 2011, SECOND DIVISION (Brion, J.)
Simple neglect of duty is defined as the failure of an employee to give proper attention to a
required task or to discharge a duty due to carelessness or indifference.
Enrique E. Manabat, Jr. (Manabat), a security guard of the Court of Appeals (CA), accidentally
fired his service pistol inside the guardhouse, while in the process of unloading it for turnover to the
guard on duty for the next shift. Mr. Reynaldo V. Dianco (Dianco), the Chief of the CA Security Services
Unit, recommended that Manabat be dismissed from service for gross neglect of duty. Manabat
explained that the firing of his service pistol was purely accidental, that it was not done with evident
bad faith, and it did not cause undue injury to any party; as such, he reasoned that his dismissal from
the service for gross neglect of duty was unwarranted. He further explained that, while he was
unloading the pistol, he observed the usual safety procedure. He also alleged that the service pistol
may have been defective because 9mm FEG Hungary pistols used during their recent firing course at
Camp Crame malfunctioned. After investigations, the CA Clerk of Court found Manabat liable only for
simple neglect of duty, and recommended a penalty of one month and one day of suspension without
pay. The Office of the Court Administrator (OCA) agreed with the CA’s finding that Manabat is liable
for only simple neglect of duty, as the elements of gross negligence were wanting in the case.
ISSUE:
Whether Manabat may be held liable for simple neglect of duty.
RULING:
YES. Simple neglect of duty is defined as the failure of an employee to give proper attention
to a required task or to discharge a duty due to carelessness or indifference. On the other hand, gross
neglect of duty is characterized by want of even the slightest care, or by conscious indifference to the
consequences, or by flagrant and palpable breach of duty. The unexpected discharge of a firearm may
occur for a variety of reasons – from a mechanical failure, or from the carelessness of the person
handling the firearm. While Manabat alleges that it was a mechanical failure that caused the firing,
his reference to the malfunction that happened at Camp Crame is not proof that his pistol was
defective.
However, his negligence cannot be considered gross in nature because there is nothing in the records
to show that the Manabat willfully and intentionally fired his service pistol. Also, at the time of the
incident, the Manabat did observe most of the safety measures required in unloading his
firearm. Therefore, he can only be held liable for simple neglect of duty.
JEROME JAPSON v. CIVIL SERVICE COMMISSION

G.R. No. 189479, 12 April 2011, EN BANC (Nachura, J.)
Prejudice to the service is not only through wrongful disbursement of public funds or loss of
public property. Greater damage comes with the public’s perception of corruption and incompetence in
the government.
Jerome Japson became the subject of a series of inquiries conducted by the SSS linking him to
a profiting venture together with Spouses Abuan involving the processing of claims for SSS death and
funeral benefits while he was assigned at SSS Baguio City from 1997 to May 1998. A case for
Dishonesty, Grave Misconduct, and Conduct Prejudicial to the Best Interest of the Service was filed
against Japson before the SSS. The SSS promulgated a decision finding Japson guilty on all counts.
Japson’s motion for reconsideration was denied so he appealed to the Civil Service Commission (CSC).
The CSC affirmed the SSS decision. Japson’s motion for reconsideration having been denied prompted
him to file a Petition for Review before the CA. The CA, promulgated a Decision denying the petition
and affirming the CSC’s resolutions. Japson moved for reconsideration, but the same was denied.
Japson then filed a Petition for Review on Certiorari before the Supreme Court arguing that
the imposition of the penalty is unfounded. He posits that since the CSC found that he had not
financially benefited from the transactions, he should not be penalized or administratively held liable
and dismissed from the service.
In its Comment, the CSC, through the Office of the Solicitor General, argues that the CA
correctly upheld its (CSCs) findings. The CSC maintains that petitioner’s irregular conduct left the SSS
vulnerable to swindlers who may use the office as an unwitting instrument to foist their deceit on the
hapless public. It said that petitioner’s irregular and indiscriminate judgment relative to the handling
of claims caused a serious breach in the integrity of the system observed by the SSS, as well as his
having endangered the welfare of the public at large. The CSC also insists that petitioner was already
an employee of the SSS at the time of the commission of the offenses, since he was absorbed as a
regular employee on May 27, 1998. His failure to refer the matter to his superiors and keeping the
money in his possession even after he was already absorbed as a regular employee of the SSS caused
prejudice to the integrity of the agency, the CSC emphasized.
ISSUE:
Whether Japson is guilty of dishonesty, grave misconduct and conduct prejudicial to the best
interest of the service
RULING:
YES. When an officer or employee is disciplined, the object sought is not the punishment of
such officer or employee, but the improvement of the public service and the preservation of the
public’s faith and confidence in the government. In administrative cases, the injury sought to be
remedied is not merely the loss of public money or property. More significant are the pernicious
effects of such action on the orderly administration of government services. Acts that go against the
established rules of conduct for government personnel bring harm to the civil service, whether they
result in loss or not. Whether or not petitioner gained any financial benefit is not relevant. Neither is
the fact that the government did not actually lose money through incorrect disbursement of public
funds.
He allowed the Spouses Abuan to use his position to make their clients believe that he could
give them undue advantage over others without the same connection by processing their claims
faster. Likewise, his acts imply malevolent intent, and not merely error in judgment. He was aware of
what the Spouses Abuan were doing and was complicit in the same. At the very least, he failed to stop
the illegal trade, and that constitutes willful disregard of the laws and rules. Taken together, all the
circumstances, as found by the SSS and the CSC, show that petitioner committed acts of Dishonesty,
Grave Misconduct, and Conduct Prejudicial to the Best Interest of the Service. Prejudice to the service
is not only through wrongful disbursement of public funds or loss of public property. Greater damage
comes with the public’s perception of corruption and incompetence in the government.
PHILIPPINE CHARITY SWEEPSTAKES OFFICE BOARD OF DIRECTORS AND REYNALDO P.

MARTIN v. MARIE JEAN C. LAPID
G.R. No. 191940, 12 April 2011, EN BANC (Mendoza, J.)
It is not the intention of the Court to make the status of a casual employee at par with that of a
regular employee, who enjoys permanence of employment. The rule is still that casual employment will
cease automatically at the end of the period unless renewed as stated in the Plantilla of Casual
Employment.
Marie Jean C. Lapid (Lapid), Casual Clerk (Teller) of the Philippine Charity Sweepstakes Office
(PCSO), Bataan Provincial District Office, Balanga, Bataan, allegedly confronted, badmouthed and
shouted invectives at Lolito O. Guemo (Guemo), Chief Lottery Operations Officer of PCSO, in the
presence of other employees and patients seeking assistance from the PCSO-Bataan Provincial
District Office. Guemo filed an administrative charge against Lapid for Discourtesy in the Course of
Official Duties and Grave Misconduct. The PCSO, found her guilty and imposed on her the penalty of
Dismissal from the Service. Lapid appealed to the Civil Service Commission (CSC). The CSC dismissed
Lapid’s appeal. Lapid moved for a reconsideration but her motion was, however, denied by the CSC.
Aggrieved, Lapid filed a petition for review before the CA. The CA ruled that while it
was previously held that casual employees were not protected by security of tenure as they may be
removed from the service with or without cause, a recent case decided by the Court held otherwise.
Absent, therefore, a proven cause to dismiss, the CA held that Lapid was dismissed without cause as
contemplated in law. Regarding the question of "due process," Lapid argued that she was denied her
right thereto because the charges against her were not duly proven. The supposed Formal Charge
was unsigned and, worse, it was not served on her. No formal investigation was ever conducted on
her case. The CA again ruled for Lapid and held that she was denied due process. Thus, PCSO filed a
petition for review under Rule 45 to the Supreme Court.
ISSUE:
Whether Lapid’s dismissal from service is justified
RULING:
NO. It is not the intention of the Court to make the status of a casual employee at par with
that of a regular employee, who enjoys permanence of employment. The rule is still that casual
employment will cease automatically at the end of the period unless renewed as stated in the Plantilla
of Casual Employment. Casual employees may also be terminated anytime though subject to certain
conditions or qualifications with reference to CSC Form No. 001. Thus, they may be laid-
off anytime before the expiration of the employment period provided any of the following
occurs: (1) when their services are no longer needed; (2) funds are no longer available; (3) the
project has already been completed/finished; or (4) their performance are below par. Equally
important, they are entitled to due process especially if they are to be removed for more serious
causes or for causes other than the reasons mentioned in CSC Form No. 001. This is pursuant to
Section 2, Article IX(B) of the Constitution and Section 46 of the Civil Service Law. The reason for this
is that their termination from the service could carry a penalty affecting their rights and future
employment in the government.
Section 3(2), Article XIII of the Constitution guarantees the rights of all workers not just in
terms of self-organization, collective bargaining, peaceful concerted activities, the right to strike with
qualifications, humane conditions of work, and a living wage but also to security of tenure. Likewise,
Section 2(3), Article IX-B of the Constitution provides that "no officer or employee of the civil service
shall be removed or suspended except for cause provided by law." Apparently, the Civil Service Law
echoes this constitutional edict of security of tenure of the employees in the civil service. Thus,
Section 46 (a) of the Civil Service Law provides that "no officer or employee in the Civil Service shall
be suspended or dismissed except for cause as provided by law after due process."
In the case at bench, the action of petitioners clearly violated Lapid's basic rights as a casual
employee. As pointed out by the CSC itself, Lapid was NEVER formally charged with the
administrative offenses of Discourtesy in the Course of Official Duties and Grave Misconduct.
According to the CSC, the Formal Charge, was even unsigned, and it categorically stated that PCSO
failed to observe due process. To somehow remedy the situation, the petitioners mentioned in their
Memorandum before the CA that there was no reason anymore to pursue the administrative charge
against Lapid and to investigate further as this was superseded by a Memorandum recommending
the termination of respondent Lapid's casual employment. They pointed out that this was precisely
the reason why no Formal Charge was issued. Said memorandum, however, was not an action
independent of the administrative case which dispensed with the filing of a Formal Charge.
RIMANDO A. GANNAPAO v. CIVIL SERVICE COMMISSION (CSC), et al.

G.R. No. 180141, 31 May 2011, EN BANC (Villarama, Jr., J.)
Where the government employee concerned took advantage of long years of service and position
in public office, length of service may not be considered in lowering the penalty.
A complaint for Grave Misconduct and Moonlighting with Urgent Prayer for Preventive
Suspension and Disarming was filed against petitioner Rimando Gannapao (Gannapao).The PNP
Chief rendered his Decision finding GANNAPAO guilty of the charge of serious irregularities in the
performance of duties sentencing him to a penalty of three months suspension. The NAPOLCOM
National Appellate Board and the DILG affirmed such decision. On appeal to the CSC, it ruled that
Gannapao’s act of serving as bodyguard of Atty. Gironella and harassing the bus drivers of UWTC is
so grave as to warrant the penalty of dismissal.
On appeal to the Court of Appeals, Gannapao contended that contends that he was denied due
process in the proceedings before the Office of the Legal Service of the PNP since no notice and
summons were issued for him to answer the charges and no hearing was conducted. He claims that
his dismissal was not proper and legal as there was no introduction and presentation of evidence
against him and he was not given the opportunity to defend his side. He also assails the penalty of
dismissal imposed upon him by the CSC, alleging that it was improperly imposed considering the
mitigating circumstance of his length of service (14 years at the time the decision of the PNP Director
General was rendered). The CA affirmed the assailed resolution of the CSC and ruled that petitioner
cannot claim denial of due process since he was given ample opportunity to present his side.
ISSUES:
1. Whether Gannapao was denied due process.
2. Whether the CA correctly affirmed the CSC decision modifying the penalty from three
months suspension to dismissal from the service.
RULING:
1. NO. Reviewing the records, we find that petitioner was afforded due process during the
proceedings before the Office of the Legal Service of the PNP. As records bear out, petitioner was
adequately apprised of the charges filed against him and he submitted his answer to the complaint
while the case was still under a pre-charge investigation. When the Office of the Legal Service
conducted a summary hearing on the complaint, petitioner was again duly notified of the proceedings
and was given an opportunity to explain his side. We have held that the fact that a party filed motions
for reconsideration and appeals with the tribunals below, in which she presented her arguments and
through which she could have proffered her evidence, if any, negates her claim that she was denied
opportunity to be heard.
2. YES. The CA did not err in affirming the CSC ruling which modified the penalty imposed by
the PNP Director General as affirmed by the DILG Secretary, from three months suspension to
dismissal.
Where the government employee concerned took advantage of long years of service and
position in public office, length of service may not be considered in lowering the penalty. This Court
has invariably taken this circumstance against the respondent public officer or employee in
administrative cases involving serious offenses, even if it was the first time said public officer or
employee was administratively charged.Serious Irregularities in the Performance of Duties, like
those offenses (e.g., Grave Misconduct, Dishonesty and Conduct Prejudicial to the Best Interest of the
Service) enumerated under Section 52 (A) of the Civil Service Law, is a grave offense. Grave offenses
have the most deleterious effects on government service. By acting as a private bodyguard without
approval by the proper authorities for several months, petitioner reneged on his primary duties to
the community in the maintenance of peace and order and public safety. Such mercenary tendencies
undermine the effectivity and integrity of a national police force committed to provide protection
and assistance to citizens in times of danger and emergency. But what is worse, petitioner allowed
himself to be used in perpetrating violence and intimidation upon ordinary workers embroiled in a
legal conflict with management.
Petitioner apparently failed to grasp the gravity of his transgression which, not only impacts
negatively on the image of the PNP, but also reflects the depravity of his character. Under the
circumstances, the Court cannot consider in his favor his fourteen (14) years in the police service and
his being a first time offender. The CSC thus correctly imposed on him the maximum penalty of
dismissal. Pursuant to Section 6 of Memorandum Circular No. 93-024, the penalty of dismissal, which
results in the separation of the respondent from the service, shall carry with it the cancellation of
eligibility, forfeiture of leave credits and retirement benefits, and the disqualification from
reemployment in the police service.
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) v. ARWIN T. MAYORDOMO

G.R. No. 191218, 31 May 2011, EN BANC (Mendoza, J.)
In the administrative offense of Conduct Prejudicial to the Best Interest of the Service, the acts
complained of need not be related to or connected with the public officer’s official functions. As long as
the questioned conduct tarnishes the image and integrity of his/her public office, the corresponding
penalty may be meted on the erring public officer or employee.
Arwin T. Mayordomo (Mayordomo) was employed as Accounts Management Specialist of the

GSIS Fund Management Accounting Department (FMAD), responsible for the preparation of financial
statements. In the course of a network scan, Joseph Sta. Romana (Sta. Romana), GSIS Information
Technology Officer, discovered that Mayordomo changed his computer’s IP address despite not being
authorized to do so. The Human Resource Office issued a memorandum strictly enjoining
Mayordomo not to repeat such actuations, and to follow standard office procedures or exercise
prudent judgment and obtain the necessary clearance before engaging in any extraordinary measure.
More than a year later, Mayordomo received a Show-Cause Memorandum from the
Investigation Department in connection with his previous acts of changing his IP address. Thereafter,
GSIS President and General Manager issued a formal administrative charge against Mayordomo, for
Grave Misconduct and/or Conduct Prejudicial to the Best Interest of the Service. The GSIS rendered
its Decision finding Mayordomo guilty of Grave Misconduct and imposing upon him the penalty of
dismissal, with forfeiture of benefits, loss of eligibility and disqualification from government
service. Mayordomo moved for reconsideration of the decision arguing against the unfairness and
severity of his dismissal but GSIS denied the motion for lack of merit. Mayordomo then filed an
appeal with the Civil Service Commission (CSC) which affirmed the findings of the GSIS.
Undaunted, Mayordomo elevated the case to the CA which partly granted his petition
downgrading the offense from grave misconduct to simple misconduct. The CA however rejected
Mayordomo’s prayer for payment of backwages corresponding to the period of his preventive
suspension. The CA emphasized that Mayordomo’s dismissal is deemed a preventive suspension
pending his appeal. Thus, he was not entitled to the payment of backwages and other benefits during
the said period. GSIS contends that Mayordomo, from the outset, had full knowledge of the nature,
purpose, and importance of an IP address and the dire consequences of changing the same. In
committing computer identity and capacity theft, Mayordomo is guilty of Grave Misconduct, and even
Dishonesty, as shown by substantial evidence. Hence, the CA erred in giving credence to his assertion
that his act of changing his IP address was not attended by corruption and sinister motive,
considering that he freely chose to traverse a tortuous path of changing his IP address, to simply print
a document for his alleged rush work.
ISSUE:
Whether the downgrading of the offense from grave misconduct to simple misconduct was
proper.
RULING:
YES. The Court ruled that the administrative offense committed by the respondent is not
misconduct. To constitute misconduct, the act or acts must have a direct relation to and be connected
with the performance of official duties. The duties of Mayordomo as a member of the GSIS
FMAD surely do not involve the modification of IP addresses. The act was considered unauthorized,
precisely because dealing with the GSIS networks IP addresses is strictly reserved for ITSG personnel
who are expectedly knowledgeable in this field. Accordingly, the complained acts of respondent
Mayordomo constitute the administrative offense of Conduct Prejudicial to the Best Interest of the
Service, which need not be related to or connected with the public officers official functions. As long
as the questioned conduct tarnishes the image and integrity of his/her public office, the
corresponding penalty may be meted on the erring public officer or employee.
Conduct Prejudicial to the Best Interest of the Service is classified as a grave offense under
Section 22(t) of the Omnibus Rules Implementing Book V of Executive Order No. 292 and Other
Pertinent Civil Service Laws, with a corresponding penalty of suspension for six (6) months and one
(1) day to one (1) year for the first offense, and the penalty of dismissal for the second offense. As
this is Mayordomo’s first case, he should be meted the penalty of six (6) months and one (1) day.
SPOUSES RICARDO HIPOLITO, JR. and LIZA HIPOLITO v. TERESITA CINCO, et al.
G.R. No. 174143, 28 November 2011, FIRST DIVISION (Del Castillo, J.)
The mandate of the Office of the Building Official is to act motu proprio, or upon petition validly
received, on reported dangerous and ruinous buildings and structures that pose a threat to the life,
health and well-being of the inhabitants, and the general public.
Spouses Ricardo Hipolito, Jr. and Liza Hipolito (Spouses Hipolito) allege that on June 15, 1989,
Edeltrudis Hipolito y Mariano (Edeltrudis) entered into an agreement with Francisco Villena (now
deceased) to rent a portion of the property located at 2176 Nakar Street, San Andres Bukid, Manila
and to construct an apartment-style building adjacent to the existing house thereon. The contract
was for a period of 20 years. Pursuant to the agreement, Edeltrudis built a three-storey apartment
building without securing a building permit. Spouses Hipolito inherited the apartment building upon
the death of Edeltrudis. In 2002 or 13 years after the execution of the agreement, Spouses Hipolito
and the heirs of Francisco Villena, all residing in the property, were informed that Atty. Carlos D.
Cinco (Atty. Cinco) acquired the subject property through a deed of sale sometime in 1976.
On June 17, 2002, Atty. Cinco, Teresita Cinco and Dr. Carlota Balde Cinco (the Cincos) filed
with the Office of the Building Official (OBO) a verified request for structural inspection of an old
structure located at 2176 Nakar Street, San Andres Bukid, Manila. Acting on the request, Building
Inspector Engineer Leonardo B. Rico (Engr. Rico) conducted an initial inspection. Engr. Rico’s
inspection resulted in a report showing that two old and dilapidated buildings made of wooden
materials were found in the premises. The request was deemed as a petition for
condemnation/abatement by the Committee on Buildings (Committee). The Committee findings
showed that the subject buildings constitute an Architectural eyesore, structurally unsafe as well as
fire and electrical hazard thereby endangering the life, safety, health and welfare [of] the general
public specifically the tenants thereat, hence, it is strongly recommended that the subject building be
declared dangerous and ruinous. The OBO affirmed the said findings and recommendation. On
appeal, the Department of Public Works and Highways (DPWH) affirmed the decision of the OBO.
Before the Office of the President (OP), the OP found no reversible error to justify the reversal or
modification of the DPWH Resolution. On petition for review before the Court of Appeals (CA), the
CA dismissed the petition for review and affirmed the OP Resolution without addressing the issue of
ownership. Hence, this appeal.
ISSUE:
Whether or not the issuance of the OBO Resolution and Demolition Order was proper.
RULING:
YES. It is unquestionable that the Building Official has the authority to order the
condemnation and demolition of buildings which are found to be in a dangerous or ruinous condition.
This authority emanates from Sections 214 and 215 of the National Building Code (Presidential
Decree [P.D.] No. 1096). There is, therefore, no question as to the authority of the OBO to render the
challenged issuances. Here, the Building Official was authorized to issue the questioned Demolition
Order in view of his finding that the disputed structures are dangerous and ruinous buildings within
the purview of P.D. No. 1096, in relation to its Implementing Rules and Regulations. Correspondingly,
no irregularity in the process in which the resolution and demolition order were issued is evident. As
found by the CA, the records show that the OBO issued the resolution and Demolition Order only after
ocular inspections and hearings were conducted. Notably, the Inspectorate Team of the DPWH came
up with the same conclusion as the OBO when it conducted its own ocular inspection of the premises,
that is both Buildings 1 and 2 had structural, sanitary, plumbing and electrical defects of up to 80%.
The mandate of the OBO is to act motu proprio, or upon petition validly received, on reported
dangerous and ruinous buildings and structures that pose a threat to the life, health and well-being
of the inhabitants, and the general public. Hence, the OBO, based on its findings, can still act on the
matter pursuant to such mandate, notwithstanding Spouses Hipolito’s claim that the Cinco’s initiated
the proceedings to circumvent their rights under the law as builders in good faith. Otherwise stated,
the Cinco’s motive in initiating the proceedings which led to the issuance of the challenged OBO
Resolution and Demolition Order is immaterial as far as the OBO is concerned, so long as it is satisfied
that a building or structure is dangerous and ruinous.
EVELINA C. BANAAG v. OLIVIA C. ESPELETA,

A.M. No. P-11-3011, 16 December 2011, EN BANC (Perlas-Bernabe, J.)
Respondent's act of maintaining an illicit relationship with a married man comes within the
purview of disgraceful and immoral conduct, which is classified as a grave offense punishable with
suspension from the service for six (6) months and one (1) day to one (1) year for the first offense, and
dismissal for the second offense.
The present administrative case originated from a letter-complaint2 dated May 3, 2009 filed
by complainant Evelina C. Banaag before the Office of the Court Administrator (OCA) charging
respondent Olivia C. Espeleta with Gross Immorality and Conduct Prejudicial to the Best Interest of
the Service for engaging in an illicit and immoral relationship with her husband, Avelino C. Banaag.
ISSUE:
Whether Olivia C. Espeleta is guilty of immoral conduct.
RULING:
YES. After a careful evaluation of the records of the instant case, the Court finds respondent
Olivia C. Espeleta guilty of Disgraceful and Immoral Conduct under Section 46(b)(5), Chapter 7,
Subtitle A, Title I, Book V of the Administrative Code of 1987 which, as defined in Section 1 of CSC
Resolution No. 100912 dated May 17, 2010 (Revised Rules on the Administrative Offense of
Disgraceful and Immoral Conduct), is an act which violates the basic norm of decency, morality and
decorum abhorred and condemned by the society and conduct which is willful, flagrant or shameless,
and which shows a moral indifference to the opinions of the good and respectable members of the
community. Respondent's act of maintaining an illicit relationship with a married man comes within
the purview of disgraceful and immoral conduct, which is classified as a grave offense punishable
with suspension from the service for six (6) months and one (1) day to one (1) year for the first
offense, and dismissal for the second offense.
ISABELO L. GALANG V. LAND BANK OF THE PHILIPPINES

G.R. No. 175276, 31 May 2011, EN BANC, (Villarama, Jr., J.)
The illegally dismissed government employee shall be paid back salaries at the rate he was
receiving when he was terminated unqualified by salary increases and without deduction from earnings
received elsewhere during the period of his illegal dismissal.
Isabelo L. Galang, the Branch Manager of Land Bank Baliuag, Bulacan and a co-employee a
was administratively charged for Conduct Prejudicial to the Best Interest of the Service, Gross Neglect
of Duty and violation of the Anti-Graft law. Land Bank’s General Counsel recommended their
dismissal to the Board of Directors. The Board of Directors modified the penalty to forced resignation
with forfeiture of all benefits. Aggrieved, they appealed to the Merit Systems Protection Board (MSPB).
The MSPB sustained the penalty imposed but absolved Galang of the charges of Gross Neglect of Duty
and Violation of Rules and Regulations. Galang and Ocampo filed a motion for reconsideration, which
was denied by the MSPB.
Galang alone filed a petition for certiorari alleging grave abuse of discretion committed by
the CSC. The CA granted Galang’s motion and on September 5, 1997, issued a Resolution directing
Land Bank to reinstate him and to pay him back salaries not exceeding five years. Land Bank received
notice of said resolution but filed no appeal. Land Bank filed a Petition for Certiorari which was
dismissed by the Supreme Court in the conclusion that it was merely an afterthought considering
that it failed to file a petition for review on certiorari under Rule 45 of the Rules of Court. The bank
moved for reconsideration but was denied thus, the Court issued an Entry of Judgment. In the
meantime, Galang was reinstated in the payroll on August 16, 2001. Galang wrote Land Bank’s
President complaining that he has yet to receive Personnel Economic Relief Allowance (PERA),
Representation and Travel Allowance (RATA), Meal Allowance and Rice Subsidy. He claimed that
since the Court found Land Bank’s petition for certiorari to be a mere afterthought, he should have
been reinstated after the fifteen (15)-day period to appeal the Resolution dated September 5, 1997
had lapsed. Galang also insisted that his back salaries be computed based on the current salary rate
prescribed for his previous position. Land Bank expressed its willingness to pay Galang Meal
Allowance and Rice Subsidy. It, however, refused to include PERA and RATA as part of his back
salaries. Land Bank further explained that Galang could not be reinstated, or his back wages paid
from October 1, 1997 since there was yet no final and executory decision of the court then.
Galang filed a Motion for Issuance of Writ of Execution with the CSC to enforce the Decision
of the CA which ordered his reinstatement and the payment of his backwages for five years. The
Commission denied said motion and held that execution will not lie because Land Bank had complied
with the appellate courts decision. On appeal to the CA, it granted said petition and declared Galang
entitled to PERA, RATA and other benefits attached to his position. However, it upheld his
reinstatement on August 16, 2001 and sustained the computation of his back wages based on the
prevailing rate at the time of his dismissal.
ISSUE
1. When should Galang be reinstated?

2. What should be the basis of computing his back salaries?
3. Whether he is entitled to PERA, RATA, Meal Allowance and Rice Subsidy?
RULING
1. Galang’s position on the effective date of his reinstatement is correct. Well-entrenched is

that a judgment or order becomes final upon the lapse of the period to appeal, without an appeal
being perfected or a motion for reconsideration being filed.
In this case, Land Bank received notice of the CA Resolution dated September 5, 1997 on September
15, 1997. Thus, it had fifteen (15) days from September 15, 1997, or until September 30, 1997 to file
an appeal. Yet, Land Bank did not do so. Instead, it filed a petition for certiorari with this Court
on November 14, 1997. Land Bank’s failure to interpose an appeal within fifteen (15) days from its
receipt on September 15, 1997 of the Resolution dated September 5, 1997, rendered the same final
and executory on October 1, 1997. Galang’s reinstatement therefore must be reckoned, not
from August 16, 2001 but from October 1, 1997. This entitles him to receive back wages as well from
the date when he should have been reinstated on October 1, 1997 to August 15, 2001, one day before
he was actually reinstated.
2. The illegally dismissed government employee shall be paid back salaries at the rate he was
receiving when he was terminated unqualified by salary increases and without deduction from
earnings received elsewhere during the period of his illegal dismissal. Be that as it may, we cannot
apply the foregoing rule in the computation of Galangs back salaries from October 1, 1997 to August
15, 2001. His back salaries for such period represent recompense for the earnings he failed to realize
because he was belatedly reinstated. Following this Courts pronouncement in Cristobal v.
Melchor, Galangs back salaries for October 1, 1997 to August 15, 2001 should be computed at the rate
prevailing at the proper date of his reinstatement on October 1, 1997, inclusive of allowances,
benefits and increases in salary prior to reinstatement.
3. YES. For emphasis, the five-year period covered in the computation of Galangs back salaries
and other benefits is from July 1990 to June 1995. Also, he shall receive back salaries and other
benefits for the period during which he should have been reinstated from October 1, 1997 to August
15, 2001. Since the General Appropriations Act (GAA) for 1993 to 1998 and in the year 2000 onwards
require the actual performance of duty as a condition for the grant of RATA, Galang shall not receive
RATA in those years but shall be entitled to RATA only from July 1990 to December 1992 and in the
year 1999.
Congress enacted R.A. No. 8250 (GAA for CY 1997), which granted PERA to all government
employees and officials as a replacement of the Cost of Living Allowance (COLA). This explains why
Land Bank employees began receiving PERA only in 1997 because prior to 1997, said benefit was
called by another name, COLA. Hence, Land Bank is still liable to pay the monthly PERA to Galang. As
to Meal Allowance, Land Bank concedes Galangs entitlement thereto, albeit, it claims that it had
already paid the same. Jurisprudence dictates that the burden of proving payment of monetary claims
rests on the employer.
CARLOS COTIANGCO, et al. v. THE PROVINCE OF BILIRAN AND THE COURT OF APPEALS
G. R. No. 157139, 19 October 2011, EN BANC (Sereno, J.)
A government officer or employee’s removal from office as a result of a bona fide reorganization
is a valid cause for that employees’ removal. Under R.A. 6656, all officers and employees of the agency
being reorganized shall be invited to apply for any of the positions in the new staffing pattern, and only
those who have filed the requisite applications for the subject position may be considered by the
placement committee for possible appointment.
Dr. Carlos C. Cotiangco, Licio J. Salas, Edeltha O. Salonoy, Ma. Filipina V. Calderon, Rosalinda
A. Abilar, Medarda S. Lariba, Tito G. Gutierrez, Benjamin J. Luciano, Myrna A. Filamor and Monina
Najarro (Contiangco, et al.) held permanent appointments as public health workers in the Province
of Biliran. The Sangguniang Panlalawigan (SP) of Biliran passed SP Resolution No. 102, Series of
1998, approving the revised structure and staffing pattern of the provincial government. Pursuant to
said Resolution, Governor Parilla issued Executive Order (EO) No. 98-07, Series of 1998, dated 4
November 1998, declaring all positions in the provincial government of Biliran as abolished except
those of the Provincial Treasurer and all elective positions. EO No. 98-07 was revoked by EO No. 98-
08, Series of 1998, which in turn declared all positions under the new staffing pattern vacant and
directed all permanent employees to submit their application within fifteen (15) days from the date
of posting of the approved new staffing pattern on November 4, 1998. Contiangco, et al.filed a suit for
Prohibitionto question the validity of EO No. 98-08, Series of 1998. Meanwhile, pursuant to said EO,
a Personnel Placement Committee (Committee) was created to screen and evaluate all applicants for
the vacant positions. Contiangco, et al. failed/refused to apply for any position under the new staffing
pattern, claiming that to do so would be inconsistent with their pending suit for prohibition.
At any rate, they argue that under Rule VI, Section 9 of Civil Service Commission (CSC)
Resolution No. 91-1631, as well as Sections 5 and 6 of the Rules on Government Reorganization, there
should be a screening of the qualifications of all existing employees, and not merely of those who filed
their respective applications under the new staffing pattern. Contiangco, et al. received their notices
of termination/non-reappointment. They appealed to the governor, but he denied their appeal.
Contiangco, et al. thereafter filed an appeal to the CSC, which likewise dismissed it. Contiangco, et al.
moved for reconsideration of the CSC Resolution. This motion was denied. Contiangco, et al. elevated
the case to the Court of Appeals (CA), which affirmed the CSC resolution with modification, in that
the Province of Biliran was directed to take up petitioner Salvador Rosels possible reappointment as
Sanitation Inspector I of the Municipality of Caibiran. Contiangco, et al. moved for reconsideration of
the said Decision but the CA denied their motion.
ISSUE:
1. Whether the reorganization was done in bad faith.

2. Whether the former employees were denied due process when they were not screened and
evaluated for possible appointment to new positions.
RULING:
1. NO. A government officer or employee’s removal from office as a result of a bona

fide reorganization is a valid cause for that employees’ removal. It is a basic principle that good faith
is presumed and that the party who alleges bad faith has the burden of proving the allegation.
Petitioners therefore had the burden of proving bad faith on the part of the province when it
undertook the reorganization. Section 2 of R.A. 6656 (An Act to Protect the Security of Tenure of Civil
Service Officers and Employees in the Implementation of Government Reorganization) cites
instances that may be considered as evidence of bad faith in the removal from office of a government
officer or employee pursuant to a reorganization.
Petitioners failed to adduce evidence to show bad faith on the part of the Province in effecting
the reorganization. First, petitioners have failed to show that there was a significant increase in the
number of positions in the new staffing pattern of Biliran Province as a result of the reorganization.
On the contrary, it is undisputed that from a high of 120 positions in 1998, the number of those at the
Biliran Provincial Health Office was reduced to only 98 after the reorganization. Second, petitioners
have failed to present evidence that an office performing substantially the same functions as an
abolished office was created as a result of the reorganization. We note that there were four new
positions created within the Provincial Health Office (one Medical Technologist II for the Health
Services Group; and one Storekeeper each for Caibiran Community Hospital, Culaba Community
Hospital and Maripipi Community Hospital). None of these positions may be considered as having
been created to perform substantially the same functions as any of the abolished offices. Third,
petitioners have not shown that there was a reclassification of offices in the department or agency
concerned and the reclassified offices perform substantially the same function as the original offices.
Fourth, petitioners have not adduced evidence that they were replaced by those less qualified in
terms of status of appointment, performance and merit. Alternatively, petitioners have not adduced
any evidence to show that their qualifications in terms of performance and merit are any better than
those possessed by the persons who were eventually appointed to the reorganized positions.
2. NO. R.A. 6656 itself, the law that these Implementing Rules seek to implement, provides
only that all officers and employees of the agency being reorganized shall be invited to apply for any
of the positions in the new staffing pattern, and that the said application shall be considered by the
Placement Committee in the placement and selection of personnel. Clearly, the law mandates that
only those who have filed the requisite applications for the subject position may be considered by
the placement committee for possible appointment. The intent of this law is clear enough. After all, it
is the submission of the application form that signals an employees interest in a position. The
placement committee cannot spend its limited time and resources in considering the qualifications
of all previous employees of the agency being reorganized, even if they have not signified their
intention to continue working in the said agency. Otherwise, there is a possibility that it would
recommend the appointment of a person to a position in which the latter is not interested. Also,
without the filing of the requisite application form, there would hardly be a basis for evaluating the
qualifications of the candidates for employment.
RE: THEFT OF THE USED GALVANIZED IRON (GI) SHEETS IN THE SC

COMPOUND, BAGUIO CITY
A.M. No. 2008-15-SC, EN BANC, 31 May 2011 (PER CURIAM)
Security guards, by the very nature of their work, are mandated to secure the court premises
and protect its property from pilferage. It should go without saying that their duty should never be
compromised to advance their own interests.
The Office of Administrative Services (OAS) received reports of an accidental discovery of

used GI sheets removed and found below the perimeter fence of the back post of the SC Compound
in Baguio City. Assigned at the back post from where the GI sheets were taken was Watchman II-
Casual Advin Tugas (Tugas). Meanwhile, manning the front gate of the SC Compound were Jerome
Romero (Romero) and Ramon Torres (Torres), as the SIC. Security Guard I Arturo
Villanueva (Villanueva) is the brother of the father-in-law of Tugas. Officer-in-
Charge (OIC) Maintenance Personnel, Engineer Teofilo Sanchez (Engr. Sanchez) and Assistant OIC,
Security Division, Inocencio De Guzman (De Guzman) testified that Villanueva was then making
house repairs, and the vacant lot where the GI sheets were found was owned by the Villanueva family.
Romero testified that no outsider entered the SC Compound during his shift. Only on-duty and stay-
in maintenance personnel had entered the compound during their shifts. He had seen Tugas carrying
an umbrella and a DVD player.
As an alibi, Villanueva testified that at the time of the incident, he was off-duty and was asleep
in his house beside the SC Compound. He stated that he had no knowledge of the incident and only
became aware of it when he was called by de Guzman and was questioned on the matter. While, Tugas,
in his defense, contends that the allegations against him are malicious, baseless and biased. He
surmises that he is being harassed because he is aware of certain illegal activities of SC personnel
in Baguio. OAS recommended that Tugas be dismissed from the service for grave misconduct for
taking the GI sheets without lawful authority. As to Villanueva, OAS recommended that he be
suspended for eight (8) months for grave misconduct; while Torres be suspended for twenty (20)
days with warning for tolerating Tugas DVD watching while on duty; and De Guzman be admonished
for falling short of his responsibility as Assistant OIC.
ISSUE:
Whether the Tugas and Villanueva are guilty of misconduct.
RULING:
YES. From the established facts and circumstances, there is reasonable ground to believe that
Tugas is indeed responsible for the taking of the GI sheets from the SC Compound. Security guards,
by the very nature of their work, are mandated to secure the court premises and protect its property
from pilferage. It should go without saying that their duty should never be compromised to advance
their own interests. As a security guard, Tugas is bound to safeguard the court premises and its
properties. Tugas very clearly violated his duty by taking the GI sheets with the intention to use it for
personal house repairs. In so doing, he unlawfully used his position to procure benefit for himself,
blatantly contrary to his duty. With the element of corruption accompanying his unlawful behaviour,
Tugas is guilty of grave misconduct. Tugas further violated his duty by watching a DVD at the time he
was on duty, in violation of General Order No. 11, requiring him to be especially watchful at night.
Such also amount to grave misconduct, and at the same time, is clearly prejudicial to the best interest
of the service. Thus, when the very person charged with the protection of court property has not only
failed to do so but instead become the perpetrator of the very misdeeds he is mandated to prevent,
dismissal from the service is warranted.
Similarly, there is reasonable ground to believe that Villanueva is guilty of grave misconduct.
A memorandum dated August 5, 2008 to Engr. Sanchez, reveals the Villanueva needed ten (10) pieces
of GI sheets for the repair of his house. This request, however, was denied and Villanueva was
informed to wait for another disposal schedule of GI sheets. Photos of the house of Villanueva show
GI sheets closely resembling those SC GI sheets at the back post.
ELECTION LAW
CONSTANCIO F. MENDOZA v. SENEN C. FAMILARA and COMMISSION ON ELECTIONS

G.R. No. 191017, 15 November 2011, EN BANC (Perez, J.)
The three-term limit has been there all along as early as the second barangay law (RA No. 6679)
after the 1987 Constitution took effect; it was continued under the Local Government Code (LGC) and
can still be found in the current law.
Constancio F. Mendoza (Mendoza) was a candidate for Barangay Captain of Barangay

Balatasan, Oriental Mindoro in the 29 October 2007 Barangay Elections. Prior thereto, Mendoza had
been elected as Barangay Captain for the same barangay for three consecutive terms. Senen C.
Familara (Familiar) filed a Petition to Disqualify Mendoza, averring that, under Section 2 of Republic
Act (R.A.) No. 9164, the latter is ineligible to run for the position, having been elected and having
served the same for three consecutive terms prior to the 2007 Barangay Elections. The Commission
on Elections (COMELEC) Regional Election Director of Region IV, Atty. Jocelyn V. Postrado, issued a
Resolution recommending the necessary action be filed against Mendoza for misrepresenting himself
as a qualified candidate for the position. Undaunted, Mendoza filed a number of Motions, all seeking
to forestall the implementation of the COMELEC Resolution.
Mendoza won the elections and was proclaimed the Barangay Captain. Consequently, his
rival, Thomas Pajanel (Pajanel), filed a petition for quo warranto and mandamus against Mendoza
before the Muncipal Circuit Trial Court (MCTC) for being ineligible to hold the position. The MCTC
granted his petition, and disqualified Mendoza, in accordance with Section 2 of R.A. No. 9164. In the
present petition, Mendoza challenges the constitutionality of the retroactive application of the three-
consecutive term limit imposed on barangay officials, beginning from the 1994 barangay elections.
ISSUE:
Whether the three-consecutive term limit rule reckoned from the 1994 Barangay Elections is
constitutional.
RULING:
YES. Citing their decision in COMELEC v. Cruz, the Court ruled that no retroactive application
was made because the three-term limit has been there all along as early as the second barangay law
(RA No. 6679) after the 1987 Constitution took effect; it was continued under the Local Government
Code (LGC) and can still be found in the current law. The first law that provided a term limitation
for barangay officials was RA No. 6653 (1988); it imposed a two-consecutive term limit. After only
six months, Congress, under RA No. 6679 (1988), changed the two-term limit by providing for a
three-consecutive term limit. This consistent imposition of the term limit gives no hint of any
equivocation in the congressional intent to provide a term limitation. Thereafter, RA No. 7160 – the
LGC – followed, bringing with it the issue of whether it provided, as originally worded, for a three-
term limit for barangay officials.
All these inevitably lead to the conclusion that the challenged proviso has been there all along
and does not simply retroact the application of the three-term limit to the barangay elections of 1994.
Congress merely integrated the past statutory changes into a seamless whole by coming up with the
challenged proviso.
SERGIO G. AMORA, JR. v. COMMISSION ON ELECTIONS and ARNIELO S. OLANDRIA
G.R. No. 192280, 25 January 2011, EN BANC (Nachura, J.)
Laws prescribing qualifications for and disqualifications from office are liberally construed in
favor of eligibility since the privilege of holding an office is a valuable one.
Sergio G. Amora, Jr. (Amora) filed his Certificate of Candidacy (COC) for Mayor of Candijay,
Bohol. To oppose him, the Nationalist People's Coalition (NPC) fielded Trgypve L. Olaivar (Olaivar)
for the mayoralty post. Arnielo S. Olandria (Olandria), one of the candidates for councilor of the NPC
in the same municipality, filed before the Commission on Election (COMELEC) a Petition for
Disqualification against Amora. He alleged that Amora's COC was not properly sworn, contrary to the
requirements of the Omnibus Election Code (OEC) and the 2004 Rules on Notarial Practice, as he
merely presented his Community Tax Certificate (CTC), instead of presenting a competent evidence
of his identity. As such, Olandria argued that his COC had no force and effect, and should be
considered as not filed. Atty. Oriculo Granada (Atty. Granada), the notary public who notarized
Amora’s COC, countered that he accepted the latter’s CTC because he personally knows him. While
Amora won in the local elections, the COMELEC en banc granted the Olaivar’s petition and
disqualified Amora.
ISSUE:
Whether Amora’s failure to present a competent evidence of his identity in his COC may be a
ground for his disqualification as a candidate.
RULING:
NO. A petition for disqualification relates to the declaration of a candidate as ineligible or

lacking in quality or accomplishment fit for the position of mayor. The distinction between a petition
for disqualification and the formal requirement in Section 73 of the OEC that a COC be under oath is
not simply a question of semantics as the statutes list the grounds for the disqualification of a
candidate. Furthermore, it should be remembered that laws prescribing qualifications for and
disqualifications from office are liberally construed in favor of eligibility since the privilege of holding
an office is a valuable one. Therefore, seeing as that an improperly sworn COC is not equivalent to a
possession of a ground for disqualification, the COMELEC committed a grave abuse of discretion in
disqualifying Amora for the same.
CERIACO BULILIS v. VICTORINO NUEZ

G.R. No. 195953, 9 August 2011, EN BANC (Leonardo-De Castro, J.)
A petition for certiorari questioning an interlocutory order of a trial court in an electoral

protest is within the appellate jurisdiction of the COMELEC.
Ceriaco Bulilis was proclaimed the winner in the 2010 elections for Punong Barangay in
Barangay Bulilis, Ubay, Bohol. His opponent, Victorino Nuez, thereafter filed an election protest with
the Municipal Circuit Trial Court (MCTC). Bulilis filed a motion to dismiss alleging that MCTC has no
jurisdiction over the election protest since Nuez failed to implead the Chairman and Members of the
Board of Election Inspectors, who were said to be indispensable parties. A notice of hearing was
issued by the MCTC but the counsel of Bulilis claimed that he only received the notice the day before
the scheduled date for the preliminary conference.
The MCTC judge, ruling that Bulilis failed to file his brief at least 1 day before the preliminary
conference, granted Nuez’s motion to present evidence ex parte. Bulilis then filed a petition for
certiorari with the Regional Trial Court (RTC) which dismissed the petition on the ground that it is
the COMELEC which has jurisdiction over the case. Bulilis argues, among others, that the appellate
jurisdiction of the COMELEC is limited to decisions of election courts and not to interlocutory orders.
ISSUE:
Whether or not COMELEC has appellate jurisdiction over interlocutory decisions of the MCTC.
RULING:
YES. Administrative Matter (A.M.) No. 07-7-12-SC (which amended, among others, Rule 65 of
the Rules of Court), clearly provided that:
“In election cases involving an act or an omission of a municipal or a regional trial

court, the petition shall be filed exclusively with the Commission on Elections, in aid
of its appellate jurisdiction.”
Plainly, from the foregoing, this Court recognizes the COMELEC’s appellate jurisdiction over
petitions for certiorari against all acts or omissions of courts in election cases. Indeed, a petition
for certiorari questioning an interlocutory order of a trial court in an electoral protest was within the
appellate jurisdiction of the COMELEC. Under Rule 14, Section 8 of A.M. No. 07-4-15-SC, decisions of
municipal trial courts in election contests involving barangay officials are appealed to the
COMELEC. It is the COMELEC which has jurisdiction over petitions for certiorari involving acts of the
municipal trial courts in such election contests. In all, the RTC committed no grave abuse of discretion
in dismissing the petition for lack of jurisdiction.
Quo warranto

ALEJANDRO S. URRO, IN HIS CAPACITY AS THE NEW APPOINTEE VICE HEREIN PETITIONER
HON. LUIS MARIO M. GENERAL, NATIONAL POLICE COMMISSION
G.R. No. 191560, March 29, 2011, EN BANC (Brion, J.)
For a petition for quo warranto to be successful, the suing private individual must show a clear
right to the contested office. His failure to establish this right warrants the dismissal of the suit for lack
of cause of action; it is not even necessary to pass upon the right of the defendant who, by virtue of his
appointment, continues in the undisturbed possession of his office.
Then President Gloria Macapagal-Arroyo (PGMA) appointed Imelda Roces (Roces) as acting
Commissioner of the NAPOLCOM, representing the civilian sector, and later as acting NAPOLCOM
Commissioner. When Roces died, PGMA appointed the Luis Mario General (General)
as acting NAPOLCOM Commissioner in place of Roces. Also, PGMA appointed Eduardo Escueta
(Escueta) as acting NAPOLCOM Commissioner and designated him as NAPOLCOM Vice Chairman.
Later, PGMA appointed Alejandro Urro (Urro) in place of the General, Constancia de Guzman in place
of Celia Leones, and Escueta as permanent NAPOLCOM Commissioners. DILG Head Executive
Assistant/Chief-of-Staff Pascual Veron Cruz, Jr. (Cruz) issued separate congratulatory letter to Urro.
After being furnished a copy of the congratulatory letter, General filed a petition for quo warranto
questioning the validity of Urro’s appointment on the ground that it violates the constitutional
prohibition against midnight appointments. However, the newly elected President, Benigno S.
Aquino III, issued Executive Order No. 2 (E.O. No. 2) revoking the appointments issued by the by
PGMA in violation of the constitutional ban on Midnight Appointments. Urro posits that General is
not a real part-in-interest to file the petition for quo warranto since he was merely appointed in an
acting capacity and could be removed from office at anytime.
ISSUE:
Whether or not General has a cause of action to file a petition for quo warranto.
RULING:
NO. Quo warranto is a remedy to try disputes with respect to the title to a public office.
Generally, quo warranto proceedings are commenced by the Government as the proper party-
plaintiff. However, under Section 5, Rule 66 of the Rules of Court, an individual may commence such
action if he claims to be entitled to the public office allegedly usurped by another. The person
instituting the quo warranto proceedings in his own behalf must show that he is entitled to the office
in dispute; otherwise, the action may be dismissed at any stage.
Emphatically, Section 6, Rule 66 of the same Rules requires the petitioner to state in the
petition his right to the public office and the respondent’s unlawful possession of the disputed
position. The Court already held that for a petition for quo warranto to be successful, the suing
private individual must show a clear right to the contested office. His failure to establish this right
warrants the dismissal of the suit for lack of cause of action; it is not even necessary to pass upon the
right of the defendant who, by virtue of his appointment, continues in the undisturbed possession of
his office. Since General merely holds an acting appointment, he clearly does not have a cause of
action to maintain the present petition. The essence of an acting appointment is its temporariness
and its consequent revocability at any time by the appointing authority. General, in a quo
warranto proceeding who seeks reinstatement to an office, on the ground of usurpation or illegal
deprivation, must prove his clear right to the office for his suit to succeed; otherwise, his petition
must fail.
DANILO MORO v. GENEROSO REYES DEL CASTILLO, JR.

G.R. No. 184980, March 30, 2011, SECOND DIVISION (Abad, J.)
In quo warranto, the petitioner who files the action in his name must prove that he is entitled to
the subject public office. Otherwise, the person who holds the same has a right to undisturbed possession
and the action for quo warranto may be dismissed.
The Ombudsman charged Generoso Reyes Del Castillo, Jr. (Del Castillo), then Chief
Accountant of the General Headquarters (GHQ) Accounting Center of the Armed Forces of the
Philippines (AFP), with dishonesty, grave misconduct and conduct prejudicial to the best interest of
the service. The Ombudsman alleged that Del Castillo made false statements in his Statement of
Assets and Liabilities and that he acquired properties manifestly out of proportion to his reported
salary. The GHQ reassigned Del Castillo to the Philippine Air Force (PAF) Accounting Center by virtue
of GHQ AFP Special Order 91 (SO 91). Through the same order, Danilo Moro (Moro), then Chief
Accountant of the Philippine Navy, took over the position of Chief Accountant of the GHQ Accounting
Center. Meantime, the Ombudsman placed Del Castillo under preventive suspension and eventually
ordered his dismissal from the service. The penalty imposed on him included cancellation of
eligibility, forfeiture of retirement benefits, and perpetual disqualification from reemployment in the
government. Following the lapse of his suspension, Del Castillo attempted to reassume his former
post of GHQ Chief Accountant. But, he was unable to do so since Moro declined to yield the
position. Thus, Del Castillo filed a petition for quo warranto, claiming that Moro was merely detailed
as GHQ Chief Accountant when the Ombudsman placed Del Castillo under preventive
suspension. Since the latter’s period of suspension already lapsed, he was entitled to resume his
former post and Moro was but a usurper. Moro countered that his appointment under SO 91 as GHQ
Chief Accountant was a permanent appointment. Indeed, the GHQ had already reassigned Del Castillo
to the PAF Accounting Center even before the Ombudsman placed him under preventive
suspension. Del Castillo was, therefore, not automatically entitled to return to his former GHQ post
despite the lapse of his suspension.
ISSUE:
Whether or not Del Castillo is entitled to be restored to the position of Chief Accountant of
the GHQ Accounting Center that he once held.
RULING:
An action for quo warranto under Rule 66 of the Rules of Court may be filed against one who
usurps, intrudes into, or unlawfully holds or exercises a public office. It may be brought by the
Republic of the Philippines or by the person claiming to be entitled to such office. In quo warranto,
the petitioner who files the action in his name must prove that he is entitled to the subject public
office. Otherwise, the person who holds the same has a right to undisturbed possession and the action
for quo warranto may be dismissed.
In this case, it was Del Castillo who filed the action, claiming that he was entitled as a matter
of right to reassume the position of GHQ Chief Accountant after his preventive suspension ended on
March 11, 2007. He argues that, assuming his reassignment to the PAF Accounting Center was valid,
the same could not exceed one year. Since his detail at the PAF took effect under SO 91 on April 1,
2006, it could last not later than March 31, 2007. By then, Moro should have allowed him to return to
his previous posting as GHQ Chief Accountant. But, as Moro points out, he had been authorized under
SO 91 to serve as GHQ Chief Accountant. Del Castillo, on the other hand, had been ordered dismissed
from the service by the Ombudsman. Consequently, he cannot reassume the contested position.
Moreover, Del Castillo brought the action for quo warranto in his name months after the Ombudsman
ordered his dismissal from service. The dismissal order was immediately executory even pending
appeal. Consequently, he has no right to pursue the action for quo warranto or reassume the position
of Chief Accountant of the GHQ Accounting Center.
LOCAL GOVERNMENT CODE

RODOLFO G. NAVARRO et al. v. EXECUTIVE SECRETARY EDUARDO ERMITA et al.
The land area requirement shall not apply where the proposed province is composed of one (1) or
more islands.
In 2006, the President of the Republic approved into law Republic Act (R.A.) No. 9355 (An Act
Creating the Province of Dinagat Islands). The Commission on Elections (COMELEC) conducted the
mandatory plebiscite for the ratification of the creation of the province under the Local Government
Code (LGC). With the approval of the people from both the mother province of Surigao del Norte and
the Province of Dinagat Islands (Dinagat), the President appointed the interim set of provincial
officials who took their oath of office. Later, during the May 14, 2007 synchronized elections the
Dinagatnons elected their new set of provincial officials who assumed office on July 1, 2007,
Petitioners Rodolfo G. Navarro, Victor F. Bernal and Rene O. Medina, former political leaders
of Surigao del Norte, as taxpayers and residents of the Province of Surigao del Norte, filed another
petition for certiorari seeking to nullify R.A. No. 9355 for being unconstitutional. They alleged that
the creation of Dinagat as a new province, if uncorrected, would perpetuate an illegal act of Congress,
and would unjustly deprive the people of Surigao del Norte of a large chunk of the provincial territory,
Internal Revenue Allocation (IRA), and rich resources from the area. They pointed out that when the
law was passed, Dinagat had a land area of 802.12 square kilometers only and a population of only
106,951, failing to comply with Section 10, Article X of the Constitution and of Section 461 of the LGC.
The Supreme Court rendered its Decision declaring R.A. No. 9355 unconstitutional for failure to
comply with the requirements on population and land area in the creation of a province under the
LGC. Consequently, it declared the proclamation of Dinagat and the election of its officials as null and
void. The Decision likewise declared as null and void the provision on Article 9 (2) of the Rules and
Regulations Implementing the LGC (LGC-IRR), stating that, "[t]he land area requirement shall not
apply where the proposed province is composed of one (1) or more islands" for being beyond the
ambit of Article 461 of the LGC, inasmuch as such exemption is not expressly provided in the law.
The Republic, represented by the Office of the Solicitor General, and Dinagat filed their
respective motions for reconsideration of the Decision which was denied by the Court. Thus, they
both filed their respective motions for leave of court to admit their second motions for
reconsideration, accompanied by their second motions for reconsideration. These motions were
eventually "noted without action" by the Supreme Court.Meanwhile, the movants-intervenors, the
duly elected officials of Surigao del Norte in the May 2010 elections, filed Motion for Leave to
Intervene and to File and to Admit Intervenors’ Motion for Reconsideration of the Court’s Resolution.
They allege that their election to their respective offices would necessarily be annulled since Dinagat
Islands will revert to its previous status as part of the First Legislative District of Surigao del Norte
and a special election will have to be conducted for governor, vice governor, and House of
Representatives member and Sangguniang Panlalawigan member for the First Legislative District of
Surigao del Norte.
The Court denied said Motions. After denying the Motion for Reconsideration filed by the
movants-intervenors, Court issued an order for Entry of Judgment, stating that its decision in the
case had become final and executory. This prompted the movants-intervenors to file an Urgent
Motion to Recall Entry of Judgment.
ISSUES:
1. Whether the movants-intervenors have locus standi
2. Whether the passage of R.A. No. 9355 operates as an act of Congress amending Section 461 of
the LGC
3. Whether the exemption from territorial contiguity, when the intended province consists of two
or more islands, includes the exemption from the application of the minimum land area
requirement
RULING:
1. YES. It cannot be denied that movants-intervenors will suffer direct injury in the event
their Urgent Motion to Recall Entry of Judgment dated October 29, 2010 is denied and their Motion
for Leave to Intervene and to File and to Admit Intervenors Motion for Reconsideration of the
Resolution dated May 12, 2010 is denied with finality. Indeed, they have sufficiently shown that they
have a personal and substantial interest in the case, such that if the May 12, 2010 Resolution be not
reconsidered, their election to their respective positions during the May 10, 2010 polls and its
concomitant effects would all be nullified and be put to naught.
2. YES. The bill that eventually became R.A. No. 9355 was filed and favorably voted upon in
both Chambers of Congress. Such acts of both Chambers of Congress definitively show the clear
legislative intent to incorporate into the LGC that exemption from the land area requirement, with
respect to the creation of a province when it consists of one or more islands, as expressly provided
only in the LGC-IRR. Thereby, and by necessity, the LGC was amended by way of the enactment of
R.A. No. 9355
3. YES. Without doubt, the primordial criterion in the creation of local government units,
particularly of a province, is economic viability. This is the clear intent of the framers of the LGC. With
respect to the creation of barangays, land area is not a requisite indicator of viability. However, with
respect to the creation of municipalities, component cities, and provinces, the three (3) indicators of
viability and projected capacity to provide services, i.e., income, population, and land area, are
provided for. But it must be pointed out that when the local government unit to be created consists
of one (1) or more islands, it is exempt from the land area requirement as expressly provided in
Section 442 and Section 450 of the LGC if the local government unit to be created is a municipality or
a component city, respectively. This exemption is absent in the enumeration of the requisites for the
creation of a province under Section 461 of the LGC, although it is expressly stated under Article 9(2)
of the LGC-IRR.
There appears neither rhyme nor reason why this exemption should apply to cities and
municipalities, but not to provinces. In fact, considering the physical configuration of the Philippine
archipelago, there is a greater likelihood that islands or group of islands would form part of the land
area of a newly-created province than in most cities or municipalities. It is, therefore, logical to infer
that the genuine legislative policy decision was expressed in Section 442 (for municipalities) and
Section 450 (for component cities) of the LGC, but was inadvertently omitted in Section 461 (for
provinces). Thus, when the exemption was expressly provided in Article 9(2) of the LGC-IRR, the
inclusion was intended to correct the congressional oversight in Section 461 of the LGC and to reflect
the true legislative intent. It would, then, be in order for the Court to uphold the validity of Article
9(2) of the LGC-IRR.
NEW SUN VALLEY HOMEOWNERS ASSOCIATION, INC. v. SANGGUNIANG BARANGAY, et al.
G.R. No. 156686, 27 July 2011, FIRST DIVISION (Leonardo- De Castro, J.)
The local government unit’s power to close and open roads within its jurisdiction through
passage of ordinance is clear under Section 21 of LGC. However, a resolution can order the opening of
streets if such is a public streets and the order is merely a directive to open streets which should rightfully
be opened for public use.
The Sangguniang Barangay of Sun Valley (BSV Sangguniang Barangay) issued BSV Resolution
No. 98-096 directing the New Sun Valley Homeowners Association to open Rosemallow and Aster
Streets to vehicular and pedestrian traffic. The New Sun Valley Homeowners Association, Inc.
(NSVHAI) filed a petition for writ of preliminary injunction with Regional Trai Court (RTC). It claimed
that the implementation would cause grave and irreparable injury to them. RTC issued a temporary
restraining order. NSVHAI submitted an amended petition wherein it claimed that BSV Sangguniang
Barangay had no jurisdiction over the opening of the mentioned streets and that barangay resolution
cannot validly cause the opening of the subject roads because under the law, ordinance is required to
effect such an act. BSV Sangguniang Barangay filed its motion to dismiss.RTC issued preliminary
injunction. In motion for reconsideration, RTC dismissed the case ruling that the power or authority
to close or open said streets is vested in the local government units and not on homeowners
association pursuant to Sectioon 21 of Local Government Code (LGC). On appeal, Court of Appeals
(CA) affirmed the order of RTC.
ISSUE:
1. Whether or not a BSV Sangguniang Barangay may order the opening of streets by mere
resolution.
2. Whether or not NSVHAI failed to exhaust administrative remedy as provided under LGC.
RULING:
1. YES. The local government unit’s power to close and open roads within its jurisdiction is clear
under Section 21 of LGC. Contrary to NSHVAI’s position, passage of ordinance by a local government
unit to effect the opening of local road have no applicability to the present case since the subdivision
road lots sought to be opened to decongest traffic in the area have already been donated to the City
Government. As such, it had taken the nature of public roads which are withdrawn from the
commerce of man. Consequently, BSV Sangguniang Barangay’s act of passing the disputed barangay
resolution had for its purpose not the opening of a private road but merely as directive or reminder
to NSVHAI to cause the opening of a public road which should rightfully be open for use of the public.
2. YES. NSVHAI recourse in questioning BSV Resolution No. 98-096 should have been with the
Mayor as clearly stated in Section 32 of LGC. The mayor shall exercise general supervision over the
component barangays. The present case could not qualify as an exception to the doctrine of
exhaustion of administrative remedies. It is the Mayor who can best review the Sangguniang
Barangay’s action to see if it acted within the scope of its prescribed powers and functions. Indeed, it
is a local problem to be resolved within the local government.
Local Taxation
STA. LUCIA REALTY & DEVELOPMENT, INC., V. CITY OF PASIG, MUNICIPALITY OF CAINTA,
PROVINCE OF RIZAL
G.R. No. 166838, 15 June 2011, FIRST DIVISION (Leonardo-De Castro, J.)
While a local government unit is authorized under several laws to collect real estate tax on
properties falling under its territorial jurisdiction, it is imperative to first show that these properties are
unquestionably within its geographical boundaries.
Sta. Lucia Realty & Development, Inc. (Sta. Lucia) is the registered owner of several parcels of
land located in Barrio Tatlong Kawayan, Municipality of Pasig (Pasig). The parcel of land covered by
TCT No. 39112 was consolidated with that covered by TCT No. 518403, which was situated in Barrio
Tatlong Kawayan, Municipality of Cainta, Province of Rizal (Cainta). The two combined lots were
subsequently partitioned into three, for which TCT Nos. 532250, 598424, and 599131, now all
bearing the Cainta address, were issued. TCT No. 39110 was also divided into two lots, becoming TCT
Nos. 92869 and 92870. On the other hand, the lot covered by TCT No. 38457 was not segregated, but
a commercial building owned by Sta. Lucia East Commercial Center, Inc., a separate corporation, was
built on it. Upon Pasig’s petition to correct the location stated in TCT Nos. 532250, 598424, and
599131, the Land Registration Court, ordered the amendment of the TCTs to read that the lots with
respect to TCT No. 39112 were located in Barrio Tatlong Kawayan, Pasig City.
Thus, Pasig filed a Complaint against Sta. Lucia for the collection of real estate taxes, including
penalties and interests, on the lots covered by TCT Nos. 532250, 598424, 599131, 92869, 92870 and
38457, including the improvements thereon. Sta. Lucia, in its Answer, alleged that it had been
religiously paying its real estate taxes to Cainta, just like what its predecessors-in-interest did, by
virtue of the demands and assessments made and the Tax Declarations issued by Cainta on the claim
that the subject properties were within its territorial jurisdiction. Sta. Lucia further argued that since
1913, the real estate taxes for the lots covered by the above TCTs had been paid to Cainta. Cainta filed
its Answer-in-Intervention and averred that it had been collecting the real property taxes on the
subject properties even before Sta. Lucia acquired them. Cainta further asseverated that the
establishment of the boundary monuments would show that the subject properties are within its
metes and bounds. Sta. Lucia and Cainta thereafter moved for the suspension of the proceedings, and
claimed that there is a pending petition in the Antipolo RTC, for the settlement of boundary dispute
between Cainta and Pasig, which presented a "prejudicial question" to the resolution of the case. The
RTC denied this in an Order for lack of merit. Holding that the TCTs were conclusive evidence as to
its ownership and location, the RTC, rendered a Decision in favor of Pasig.
Sta. Lucia and Cainta appealed the case. In affirming the RTC, the Court of Appeals declared
that there was no proper legal basis to suspend the proceedings. Elucidating on the legal meaning of
a "prejudicial question," it held that "there can be no prejudicial question when the cases involved
are both civil." The Court of Appeals further held that the elements of litis pendentia and forum
shopping, as alleged by Cainta to be present, were not met.
ISSUES:
1. Whether the RTC and the CA were correct in deciding Pasig’s Complaint without waiting for
the resolution of the boundary dispute case between Pasig and Cainta;
2. Whether the Certificates of Title serve as conclusive evidence of the location of the properties
RULING:
1. NO. While a local government unit is authorized under several laws to collect real estate
tax on properties falling under its territorial jurisdiction, it is imperative to first show that these
properties are unquestionably within its geographical boundaries. Clearly therefore, the local
government unit entitled to collect real property taxes from Sta. Lucia must undoubtedly show that
the subject properties are situated within its territorial jurisdiction; otherwise, it would be acting
beyond the powers vested to it by law. The Pasig RTC should have held in abeyance the proceedings
in Civil Case No. 65420, in view of the fact that the outcome of the boundary dispute case before the
Antipolo RTC will undeniably affect both Pasig’s and Cainta’s rights. In fact, the only reason Pasig had
to file a tax collection case against Sta. Lucia was not that Sta. Lucia refused to pay, but that Sta. Lucia
had already paid, albeit to another local government unit. Evidently, had the territorial boundaries
of the contending local government units herein been delineated with accuracy, then there would be
no controversy at all.
2. We agree with the petitioners that, generally, a certificate of title shall be conclusive as to
all matters contained therein and conclusive evidence of the ownership of the land referred to
therein. However, it bears stressing that while certificates of title are indefeasible, unassailable and
binding against the whole world, including the government itself, they do not create or vest title. They
merely confirm or record title already existing and vested. They cannot be used to protect a usurper
from the true owner, nor can they be used as a shield for the commission of fraud; neither do they permit
one to enrich himself at the expense of other. Although it is true that "Pasig" is the locality stated in the
TCTs of the subject properties, both Sta. Lucia and Cainta aver that the metes and bounds of the
subject properties, as they are described in the TCTs, reveal that they are within Cainta’s boundaries.
This only means that there may be a conflict between the location as stated and the location as
technically described in the TCTs. Mere reliance therefore on the face of the TCTs will not suffice as
they can only be conclusive evidence of the subject properties’ locations if both the stated and
described locations point to the same area.
The Antipolo RTC, wherein the boundary dispute case between Pasig and Cainta is pending,
would be able to best determine once and for all the precise metes and bounds of both Pasig’s and
Cainta’s respective territorial jurisdictions. The resolution of this dispute would necessarily ascertain
the extent and reach of each local government’s authority, a prerequisite in the proper exercise of
their powers, one of which is the power of taxation.
COMMISSION ON AUDIT
MANOLITO AGRA, et al. v. COMMISSION ON AUDIT

G.R. No. 167807, 06 December 2011, EN BANC (Leonardo-De Castro, J.)
The Commission on Audit (COA) had exclusive jurisdiction to decide on the allowance or
disallowance of money claims arising from the implementation of Republic Act No. 6758.
Republic Act No. 6758 (RA 6758), the Compensation and Position Classification Act of 1989,
took effect on July 1, 1989. Section 12 thereof provides for the consolidation of allowances and
compensation. On October 2, 1989, the Department of Budget and Management (DBM) issued DBM-
CCC No. 10, the Implementing Rules and Regulations of RA 6758 (IRR). A group of National
Electrification Administration (NEA) employees (Agra, et al.) who were hired after October 31, 1989
claimed that they did not receive meal, rice, and children’s allowances. Thus, on July 23, 1999, they
filed a special civil action for mandamus against NEA and its Board of Administrators before the
Regional Trial Court (RTC), Branch 88, Quezon City, alleging violation of their right to the equal
protection clause under the Constitution. The RTC rendered a decision in their favor. The decision
became final and executory, and a writ of execution was issued. The RTC issued a notice of
garnishment against the funds of NEA with Development Bank of the Philippines (DBP) to the extent
of P16,581,429.00.
Aggrieved, NEA assailed the orders of the RTC before the Court of Appeals (CA). The CA
ordered the implementation of the writ of execution against the funds of NEA. Hence, NEA filed a
petition before the Court. The Court reversed the CA decision and ruled that Agra, et al. could not
proceed against the funds of NEA because the RTC Decision sought to be satisfied is not a judgment
for a specific sum of money susceptible of execution by garnishment; it is a special judgment
requiring petitioners to settle the claims of respondents in accordance with existing regulations of the
COA. Thereafter, the NEA Board of Administrators issued Resolution No. 29 on August 9, 2001
approving the entitlement to rice, medical, children, meal, and other related allowances to NEA
employees hired after October 31, 1989, and the payment of these benefits, chargeable to its
Personnel Services Savings. Thus, NEA granted the questioned allowances to its employees who were
not receiving these benefits/allowances, including rice allowance amounting to P1,865,811.84
covering the period January to August 2001. However, the resident auditor of Commission on Audit
(COA), Carmelita M. Agullana (Agullana), did not allow the payment of rice allowance for the period
January to August 2001 to NEA employees who were not incumbents as of June 30, 1989. NEA
appealed the disallowance to the COA, which was, however, denied. Hence, this petition.
ISSUES:
1. Whether or not the immutability of final decision doctrine must prevail over the exclusive
jurisdiction of the COA to audit and settle disbursements of funds.
2. Whether or not the NEA employees hired after June 30, 1989 are entitled to rice allowance.
RULING:
1. NO. In National Electrification Administration v. Morales, the order of garnishment against

the NEA funds to implement the RTC Decision was in issue, and the Court said that the COA had
exclusive jurisdiction to decide on the allowance or disallowance of money claims arising from the
implementation of RA. 6758. The Court observed therein that the RTC acted prudently in halting
implementation of the writ of execution to allow the parties recourse to the processes of the COA. In
fact, the Court even stated there that it is not for the Court to preempt the action of the COA on the
post-audit to be conducted by it per its Indorsement dated March 23, 2000.
2. NO. Section 5.5 of DBM-CCC No. 10 is clear that rice subsidy is one of the benefits that will
be granted to employees of Government-Owned and/or Controlled Corporations (GOCCs) or
Financial Institutions (GFIs) only if they are incumbents as of July 1, 1989. The Court has defined
an incumbent as a person who is in present possession of an office; one who is legally authorized to
discharge the duties of an office. There is no question that Agra, et al. employees were not incumbents
as of June 30, 1989. The Court has likewise characterized NEA as a GOCC in National Electrification
Administration v. Morales. Thus, Section 5.5, issued pursuant to the authority given to the DBM under
Section 12 of RA 6758, was correctly applied by the COA.
As Agra, et al. were hired after June 30, 1989, the COA was correct in disallowing the grant of
the benefit to them, as they were clearly not entitled to it. As quoted above, the Court has repeatedly
held that under Section 12 of RA 6758, the only requirements for the continuous grant of allowances
and fringe benefits on top of the standardized salary rates for employees of GOCCs and GFIs are as
follows: (1) the employee must be an incumbent as of July 1, 1989; and (2) the allowance or benefit
was not consolidated in the standardized salary rate as prescribed by RA 6758.
BOY SCOUTS OF THE PHILIPPINES v. COMMISSION ON AUDIT

G.R. No. 177131, 7 June 2011, EN BANC (Leonardo-De Castro, J.)
The BSP, under its amended charter, continues to be a public corporation or a government
instrumentality subject to the exercise by the COA of its audit jurisdiction in the manner consistent with
the provisions of the BSP Charter.
The Commission on Audit (COA) issued a Resolution with the subject “Defining the
Commission’s policy with respect to the audit of the Boy Scouts of the Philippines (BSP)". In its
whereas clauses, the COA Resolution stated that the BSP was created as a public corporation under
Commonwealth Act No. 111, as amended by Presidential Decree No. 460 and Republic Act No. 7278;
that in Boy Scouts of the Philippines v. National Labor Relations Commission, the Supreme Court ruled
that the BSP, as constituted under its charter, was a "government-controlled corporation within the
meaning of Article IX (B)(2)(1) of the Constitution"; and that "the BSP is appropriately regarded as a
government instrumentality under the 1987 Administrative Code.
The BSP sought reconsideration of the COA Resolution in a letter signed by the BSP National
President Jejomar C. Binay. BSP alleged that Republic Act No. 7278 (R.A. No. 7278), which amended
the BSP’s charter after the cited case was decided, amended the composition of the National
Executive Board of the BSP. RA 7287 virtually eliminated the substantial government participation
in the National Executive Board. BSP contends that it is not a government-owned or controlled
corporation; neither is it an instrumentality, agency, or subdivision of the government.
The Corporate Audit Officer of the COA furnished BSP with a Memorandum of the COA
General Counsel which opined that R.A. No. 7278 did not supersede the Court’s ruling in Boy Scouts
of the Philippines v. National Labor Relations Commission, even though said law eliminated the
substantial government participation in the selection of members of the National Executive Board of
the BSP. Thereafter, the COA informed the BSP that a preliminary survey of its organizational
structure, operations and accounting system/records shall be conducted on November 21 to 22,
2000.
Upon the BSP’s request, the audit was deferred for thirty days. The BSP then filed a Petition
for Review with Prayer for Preliminary Injunction and/or Temporary Restraining Order before the
COA. This was denied by the COA in its questioned Decision, which held that the BSP is under its audit
jurisdiction. The BSP moved for reconsideration but this was likewise denied under its questioned
Resolution. BSP then filed a petition for prohibition with preliminary injunction and temporary
restraining order against the COA.
ISSUE:
Whether the BSP falls under the COA’s audit jurisdiction
RULING:
YES. The BSP is a public corporation and its funds are subject to the COA’s audit jurisdiction.
Assuming for the sake of argument that the BSP ceases to be owned or controlled by the government
because of reduction of the number of representatives of the government in the BSP Board, it does
not follow that it also ceases to be a government instrumentality as it still retains all the
characteristics of the latter as an attached agency of the DECS under the Administrative Code. Vesting
corporate powers to an attached agency or instrumentality of the government is not constitutionally
prohibited and is allowed by the above-mentioned provisions of the Civil Code and the 1987
Administrative Code.
As presently constituted, the BSP still remains an instrumentality of the national

government. It is a public corporation created by law for a public purpose, attached to the DECS
pursuant to its Charter and the Administrative Code of 1987. It is not a private corporation which is
required to be owned or controlled by the government and be economically viable to justify its
existence under a special law. Even though the amended BSP charter did away with most of the
governmental presence in the BSP Board, this was done to more strongly promote the BSPs
objectives, which were not supported under Presidential Decree No. 460. The BSP objectives, as
pointed out earlier, are consistent with the public purpose of the promotion of the well-being of the
youth, the future leaders of the country. The amendments were not done with the view of changing
the character of the BSP into a privatized corporation. The BSP remains an agency attached to a
department of the government, the DECS, and it was not at all stripped of its public character.
Since the BSP, under its amended charter, continues to be a public corporation or a
government instrumentality, we come to the inevitable conclusion that it is subject to the exercise by
the COA of its audit jurisdiction in the manner consistent with the provisions of the BSP Charter.
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), et al. v. COMMISSION ON AUDIT (COA), et

al.
G. R. No. 162372, 19 October 2011, EN BANC (Leonardo-De Castro, J.)
Sec. 3 of Republic Act No. 8291 did not repeal the Teves Retirement Law. The repealing clause
contained in Republic Act No. 8291 is not an express repealing clause because it fails to identify or
designate the statutes that are intended to be repealed. The GSIS Retirement/Financial Plan (RFP) is
null and void for being a supplementary retirement plan, which is prohibited by the Teves Retirement
Law.
The Government Service Insurance System (GSIS) Board of Trustees, upon the
recommendation of the Management-Employee Relations Committee (MERCOM), approved Board
Resolution No. 326 wherein they adopted the GSIS Employees Loyalty Incentive Plan
(ELIP). Subsequently, Board Resolution No. 326 was amended by Board Resolution No. 360, which
provided for a single rate for all positions, regardless of salary grade, in the computation of creditable
service. Ma. Cristina D. Dimagiba (Dimagiba), the corporate auditor of GSIS, communicated to the
President and General Manager of GSIS that the GSIS RFP was contrary to law. However, the GSIS
Legal Services Group opined that the GSIS Board was legally authorized to adopt the plan since
Section 28(b) of Commonwealth Act No. 186 as amended by Republic Act No. 4968 has been repealed
by Sections 3 and 41(n) of Republic Act No. 8291. GSIS then approved Board Resolution No. 6,
wherein ELIP was renamed GSIS Retirement/Financial Plan (RFP) to conform strictly to the
wordings of Section 41(n) of Republic Act No. 8291. Upon Winston F. Garcia’s (Garcia) assumption of
office as President and General Manager, Dimagiba requested to again review the GSIS RFP. This was
denied by Garcia.
Believing that the GSIS RFP was morally indefensible, Dimagiba sought the assistance of
Commission on Audit (COA) in determining the legality and/or morality of the said Plan. COAs
General Counsel Santos M. Alquizalas (Alquizalas) issued a Memorandum to COA Commissioner Raul
C. Flores regarding the GSIS RFP. Alquizalas opined that the GSIS RFP is a supplementary retirement
plan, which is prohibited under Republic Act No. 4968, or the Teves Retirement Law. He also said
that since there is no provision in the new Republic Act No. 8291 expressly repealing the Teves
Retirement Law, the two laws must be harmonized absent an irreconcilable inconsistency. Alquizalas
pronounced that Board Resolution Nos. 360 and 6 are null and void for being violative of Section
28(b) of Commonwealth Act No. 186 as amended by Republic Act No. 4968, which bars the creation
of a supplemental retirement scheme; and Section 41(n) of Republic Act No. 8291, which speaks of
an early retirement plan or financial assistance. Commissioner Flores forwarded this Memorandum
to Dimagiba, who in turn forwarded it to Garcia. Dimagiba, in her letter attached to Alquizalas’
Memorandum, added that for lack of legal basis, her office was disallowing in audit the portion of
retirement benefits granted under the GSIS RFP, or the excess of the benefits due the retirees. Garcia
responded to Dimagiba, taking exception to the notice of disallowance for being highly irregular and
precipitate as it was based on a mere opinion of COA’s counsel who had no authority to declare the
resolution of the GSIS Board of Trustees as null and void. Garcia averred that the GSIS RFP was part
and parcel of the compensation package that GSIS may provide for its personnel, by virtue of the
powers granted to its Board of Trustees under Section 41(m) and (n) of Republic Act No. 8291. Garcia
requested Dimagiba to withdraw the notices of disallowance in the interest of industrial peace in the
GSIS. Without responding to Garcia’s Memorandum, Dimagiba issued a Notices of Disallowance.
GSIS gave notice to the COA CAO I that it was appealing the 21 Notices of Disallowance it had
received from Dimagiba on various dates. The COA, through Amorsonia B. Escarda
(Escarda), affirmed the disallowances made by Dimagiba. Escarda sustained the COA general
counsels opinion and said that while the GSIS may have the power to adopt an early retirement or a
financial assistance plan under its charter, it cannot supplement a retirement plan already existing
under the law. Escarda disagreed with GSISs assertion that the Teves Retirement Law had been
modified or repealed as the repealing clause in Republic Act No. 8291 is a general repealing clause,
which is frowned upon and is generally not effective to repeal a specific law like the Teves Retirement
Law. Undaunted, the GSIS filed before the COA a Petition for Review of CAO Is decision. COA affirmed
Escarda’s ruling and contended that what the still valid Teves Retirement Law permits is the creation
of an early retirement or financial assistance plan, and the above requirement imposed under the
GSIS RFP does not apply to either plans. GSIS sought reconsideration but COA denied the motion and
affirmed its earlier with finality.
ISSUE:
1. Whether Republic Act No. 8291 repealed Teves Retirement Law.

2. Whether Board Resolution Nos. 360, 326, and 6 (GSIS RFP), in light of Republic Act No. 8291
or the GSIS Act of 1997, and Commonwealth Act No. 186 or the Government Service
Insurance Act as amended by Republic Act No. 4968 (the Teves Retirement Law), legal.
RULING:
1. NO. The repealing clause contained in Republic Act No. 8291 is not an express repealing
clause because it fails to identify or designate the statutes that are intended to be repealed. It is
actually a clause, which predicated the intended repeal upon the condition that a substantial conflict
must be found in existing and prior laws. Since Republic Act No. 8291 made no express repeal or
abrogation of the provisions of Commonwealth Act No. 186 as amended by the Teves Retirement
Law, the reliance of the petitioners on its general repealing clause is erroneous. The failure to add a
specific repealing clause in Republic Act No. 8291 indicates that the intent was not to repeal any
existing law, unless an irreconcilable inconsistency and repugnancy exists in the terms of the new
and old laws. The Court is likewise not convinced by petitioners’ claim of repeal by implication. It is
a well-settled rule that to bring about an implied repeal, the two laws must be absolutely
incompatible and clearly repugnant that the later law cannot exist without nullifying the prior law.
This Court sees no incompatibility between the two laws being discussed here. While
Republic Act No. 8291 speaks of an early retirement incentive plan or financial assistance for the
GSIS employees, Commonwealth Act No. 186 as amended by the Teves Retirement Law talks
about insurance or retirement plans other than our existing retirement laws. In other words,
what the Teves Retirement Law contemplates and prohibits are separate retirement or insurance
plans. In fact, the very same provision declared inoperative or abolished all supplementary
retirement or pension plans.
2. NO. It is true that under Section 41(n) of Republic Act No. 8291, GSIS is expressly granted
the power to adopt a retirement plan and/or financial assistance for its employees, but a closer look
at the provision readily shows that this power is not absolute. It is qualified by the words early,
incentive, and for the purpose of retirement. The retirement plan must be
an early retirement incentive plan and such early retirement incentive plan or financial assistance
must be for the purpose of retirement. It is clear from the foregoing that Section 41(n) of Republic
Act No. 8291 contemplates a situation wherein GSIS, due to a reorganization, a streamlining of its
organization, or some other circumstance, which calls for the termination of some of its employees,
must design a plan to encourage, induce, or motivate these employees, who are not yet qualified for
either optional or compulsory retirement under our laws, to instead voluntarily retire. This is the
very reason why under the law, the retirement plan to be adopted is in reality an incentive scheme
to encourage the employees to retire before their retirement age.
Such is not the case with the GSIS RFP. Its very objective, [t]o motivate and reward employees
for meritorious, faithful, and satisfactory service, contradicts the nature of an early retirement
incentive plan, or a financial assistance plan, which involves a substantial amount that is given to
motivate employees to retire early. Instead, it falls exactly within the purpose of a retirement
benefit, which is a form of reward for an employees loyalty and lengthy service, in order to help him
or her enjoy the remaining years of his life.
Furthermore, to be able to apply for the GSIS RFP, one must be qualified to retire under
Republic Act No. 660 or Republic Act No. 8291, or must have previously retired under our existing
retirement laws. This only means that the employees covered by the GSIS RFP were those who were
already eligible to retire or had already retired. Certainly, this is not included in the scope of an early
retirement incentive plan or financial assistance for the purpose of retirement. The fact that GSIS
changed the name from Employees Loyalty Incentive Plan to Retirement/Financial Plan does not
change its essential nature. A perusal of the plan shows that its purpose is not to encourage GSISs
employees to retire before their retirement age, but to augment the retirement benefits they would
receive under our present laws. Without a doubt, the GSIS RFP is a supplementary retirement
plan, which is prohibited by the Teves Retirement Law.
PUBLIC INTERNATIONAL LAW
BAYAN MUNA v. ALBERTO ROMULO AND BLAS F. OPLE

G.R. No. 159618, 1 February 2011, EN BANC (Velasco, Jr., J.)
There are no hard and fast rules on the propriety of entering, on a given subject, into a treaty or
an executive agreement as an instrument of international relations. The primary consideration in the
choice of the form of agreement is the parties intent and desire to craft an international agreement in
the form they so wish to further their respective interests.
The Rome Statute established the International Criminal Court (ICC) conferred with power
to exercise jurisdiction over persons for the most serious crimes of international concern. These
crimes include genocide, war crimes, and crimes against humanity. The Republic of the Philippines
(RP), through its Charge dAffaires Enrique A. Manalo, signed the Rome Statute but was not ratified at
the time of the filing of this petition.
Ambassador Francis J. Ricciardone sent US Embassy Note No. 0470 to the Department of
Foreign Affairs (DFA) proposing the terms of the non-surrender bilateral agreement between the
United States of America (USA) and the RP. The RP accepted the proposals embodied under the US
Embassy Note adverted to and put in effect the Agreement with the US government. The
Agreement aims to protect what it refers to and defines as persons of the RP and US from frivolous
and harassment suits that might be brought against them in international tribunals. Bayan Muna now
imputes grave abuse of discretion to Alberto Romulo and Blas Ople, then Executive Secretary and
Secretary of Foreign Affairs of the Philippines, respectively, in concluding and ratifying
the Agreement on the ground of unconstitutionality. Romulo and Ople, on the other hand, argues that
since the Agreement is characterized as an executive agreement, Senate concurrence is not required
for its validity.
ISSUES:
1. Whether or not Bayan Muna has the legal standing to bring this petition.
2. Whether or not the RP-US Non-Surrender Agreement is valid.
3. Whether or not Senate concurrence is necessary for the validity and effectivity of the
Agreement.
4. Whether or not the Agreement contravenes the Rome Statute which restricts the jurisdiction
of the ICC.
5. Whether or not RP abdicated its sovereignty by bargaining away the jurisdiction of the ICC to
prosecute US nationals, government officials/employees or military personnel who commit
serious crimes of international concerns.
RULING:
1. YES. Bayan Muna’s representatives have complied with the qualifying conditions or
specific requirements exacted under the locus standi rule. As citizens, their interest in the subject
matter of the petition is direct and personal. At the very least, their assertions questioning
the Agreement are made of a public right, i.e., to ascertain that the Agreement did not go against
established national policies, practices, and obligations bearing on the States obligation to the
community of nations.
At any event, the primordial importance to Filipino citizens in general of the issue at hand
impels the Court to brush aside the procedural barrier posed by the traditional requirement of locus
standi, as we have done in a long line of earlier cases, notably in the old but oft-cited emergency
powers cases and Kilosbayan v. Guingona, Jr. In cases of transcendental importance, we wrote again
in Bayan v. Zamora, The Court may relax the standing requirements and allow a suit to prosper even
where there is no direct injury to the party claiming the right of judicial review.
2. YES. An exchange of notes falls into the category of inter-governmental agreements, which
is an internationally accepted form of international agreement. It is fairly clear from the foregoing
disquisition that E/N BFO-028-03 be it viewed as the Non-Surrender Agreement itself, or as an
integral instrument of acceptance thereof or as consent to be bound is a recognized mode of
concluding a legally binding international written contract among nations.
3. NO. There are no hard and fast rules on the propriety of entering, on a given subject, into a
treaty or an executive agreement as an instrument of international relations. The primary
consideration in the choice of the form of agreement is the parties intent and desire to craft an
international agreement in the form they so wish to further their respective interests. Verily, the
matter of form takes a back seat when it comes to effectiveness and binding effect of the enforcement
of a treaty or an executive agreement, as the parties in either international agreement each labor
under the pacta sunt servanda principle.
The Court has given recognition to the obligatory effect of executive agreements without the
concurrence of the Senate:
“The right of the Executive to enter into binding agreements without the necessity of
subsequent Congressional approval has been confirmed by long usage.”
4. NO. Far from going against each other, one complements the other. As a matter of fact, the
principle of complementarity underpins the creation of the ICC. The jurisdiction of the ICC is to be
complementary to national criminal jurisdictions of the signatory states. Significantly, the sixth
preambular paragraph of the Rome Statute declares that it is the duty of every State to exercise its
criminal jurisdiction over those responsible for international crimes. This provision indicates that
primary jurisdiction over the so-called international crimes rests, at the first instance, with the state
where the crime was committed; secondarily, with the ICC in appropriate situations contemplated
under Art. 17, par. 1 of the Rome Statute.
The Rome Statute expressly recognizes the primary jurisdiction of states, like the RP, over
serious crimes committed within their respective borders, the complementary jurisdiction of the ICC
coming into play only when the signatory states are unwilling or unable to prosecute.
5. NO. The Agreement is but a form of affirmance and confirmance of the Philippines national
criminal jurisdiction. National criminal jurisdiction being primary, as explained above, it is always
the responsibility and within the prerogative of the RP either to prosecute criminal offenses equally
covered by the Rome Statute or to accede to the jurisdiction of the ICC. Thus, the Philippines may
decide to try persons of the US, as the term is understood in the Agreement, under our national
criminal justice system. Or it may opt not to exercise its criminal jurisdiction over its erring citizens
or over US persons committing high crimes in the country and defer to the secondary criminal
jurisdiction of the ICC over them. As to persons of the US whom the Philippines refuses to prosecute,
the country would, in effect, accord discretion to the US to exercise either its national criminal
jurisdiction over the person concerned or to give its consent to the referral of the matter to the ICC
for trial.
NATURAL RESOURCES
DIAMOND DRILLING CORPORATION OF THE PHILIPPINES v. NEWMONT PHILIPPINES

INCORPORATED
G.R. No. 183576, 30 May 30 2011, SECOND DIVISION (Carpio, J.)
In the event there are two or more applicants for FTAA over the same area, priority shall be
given to the applicant that first filed its application.
Newmont Philippines Incorporated (Newmont) filed eight applications for Financial or

Technical Assistance (FTAA) with the Central Office Technical Secretariat of the Mines and
Geosciences Bureau (MGB) in Quezon City. Newmont wanted to explore and develop large gold
deposits in the Central Cordillera comprising a maximum contract area of 100,000 hectares of land
for each application. Newmont paid the corresponding filing and processing fees. MGB registered
Newmont’s FTAA applications on the same day of filing. Thereafter, Newmont furnished through fax
transmission the MGB Regional Office in the Cordillera Administrative Region (MGB-CAR) with its
letter-application, sketch map and coordinates defining the area of its FTAA applications. Diamond
Drilling Corporation of the Philippines (Diamond Drilling) likewise filed an application for Mineral
Production Sharing Agreement (MPSA), covering 4,860 hectares of land in the areas situated in
Benguet and Mountain Province, with the MGB-CAR. Since the area as checked by the MGB-CAR in its
records was open for mining location, Diamond Drilling paid for the filing and processing fees on the
same date. The MGB-CAR then registered Diamond Drilling’s MPSA application. Upon verification,
however, the MGB-CAR found that Diamond Drilling’s MPSA application was in conflict with a portion
of one of Newmont’s FTAA applications. Meanwhile, Republic Act No. 7942 (RA 7942) or the
Philippine Mining Act of 1995 took effect. Diamond Drilling filed a protest with the MGB-CAR and
sought to annul the eight FTAA applications of Newmont and asked that it be granted preferential
right over the areas covered by its MPSA application.
The Panel of Arbitrators of the MGB-CAR decided the case in favor of Diamond Drilling.
Newmont appealed the decision of the MGB-CAR to the Mines Adjudication Board (MAB). In a
Decision, the MAB reversed the decision of the MGB-CAR and ruled in Newmont’s favor. Diamond
Drilling filed a motion for reconsideration which the MAB denied. Diamond Drilling then filed a
petition for review with the CA. The CA however affirmed the decision of the MAB. Diamond Drilling
filed a motion for reconsideration which the CA denied.
ISSUE:
Whether Newmont must be given preferential right to utilize the area included in its FTAA
applications.
RULING:
YES. It is clear from Section 8 of DAO 63 that the MGB Central Office processes all FTAA
applications after payment of the requisite fees. Section 8 requires the FTAA applicant to furnish the
MGB Regional Office a copy of the FTAA application within 72 hours from filing of the FTAA
application. The Regional Office verifies the area that an applicant intends to utilize, and declares the
availability of the area for FTAA application. The Regional Office will then submit its recommendation
to the MGB Central Office within thirty days from receipt by the Regional Office of a copy of the FTAA
application from the applicant. However, when there are two or more applicants in the same area,
priority shall be given to the applicant that first filed its application.
In the present case, the records show that Newmont filed its FTAA applications with the MGB
Central Office in Quezon City on 20 December 1994. After Newmont paid the filing and processing
fees, the MGB Central Office registered Newmont’s FTAA applications on the same date. On the other
hand, Diamond Drilling filed its MPSA application with the MGB-CAR Regional Office in Baguio City
on 20 December 1994. However, since the pertinent documents needed by the MGB-CAR Regional
Office were lacking, it took two more days for Diamond Drilling to complete the requirements.
Diamond Drilling paid its filing and processing fees only on 22 December 1994 or two days after
Newmont’s FTAA applications were registered with the MGB Central Office. Thus, Diamond Drilling’s
MPSA application was registered by the MGB-CAR Regional Office only on 22 December 1994.
Since Newmont’s FTAA applications preceded that of Diamond Drilling’s MPSA application,
priority should be given to Newmont. Section 8 of DAO 63 is clear. It states that in the event there are
two or more applicants over the same area, priority shall be given to the applicant that first filed its
application. Newmont clearly satisfied the requirements for the acceptance and evaluation of its
FTAA applications with the MGB. Being the first to file its FTAA applications ahead of Diamond
Drilling’s MPSA application, and having furnished copies of its FTAA applications to the MGB-CAR
Regional Office within 72 hours from filing, Newmont must be given preferential right to utilize the
area included in its FTAA applications.
OMBUDSMAN
OFFICE OF THE OMBUDSMAN v. ULDARICO ANDUTAN, JR.

G.R. No. 164679, 27 July 2011, SECOND DIVISION (Brion, J.)
Although the Ombudsman is not precluded from conducting investigation a year after act or
omission was committed under Section 20(5) of RA No. 6770, the Ombudsman can no longer institute
an administrative case against public officer or employee who is no longer a public servant at the time
the case was filed.
Uldarico Andutan, Jr. (Andutan) was formerly the Deputy Director of the One- Stop Shop Tax
Credit and Duty Drawback Center of the Department of Finance (DOF) . Then Executive Secretary
Ronald Zamora (Zamora) issued a Memorandum directing all non- career officials pr those occupying
political positions to vacate their positions. Pursuant to the Memorandum, Andutan resigned from
the DOF. Andutan was charged by the Fact Finding and Intelligene Bureau (FFIB) of the Ombudsman
with estafa through falsification of public documents and violations of Section 3(a),(e),(j) of Republic
Act No. 3019. He was also administratively charged of Grave Misconduct, Dishonesty, Falsification of
Official Documents and Conduct Prejudicial to the Best Interest of the Service. FFIB concluded that
Andutan in his respective capacity irregularly approved the issuance of the Tax Credit Certificate
(TCC) to several garment/textile companies allowing subsequent illegal transfer to Steel Asia.
Ombudsman found Andutan guilty of Gross Neglect of Duty. Having been separated from service,
Andutan was imposed the penalty of forfeiture of all leaves, retirement, and other benefits and
perpetual disqualification from reemployment in government. The Court of Appeals (CA) set aside
the decision ruling that the Ombudsman should not have entertained the administrative complaint
for having filed a year after the occurrence of the act and in view of Andutan’s forced resignation.
ISSUES:
1. Whether or not Section 20(5) of RA No. 6770 prohibit the Ombudsman from conducting an
administrative investigation a year after the act was committed
2. Whether or not Andutan’s resignation rendered the administrative case against him moot
RULING:
1. NO. The provisions of Section 20(5) of RA No. 6770 are merely directory; thus, the
Ombudsman is not prohibited from conducting an investigation a year after the supposed act was
committed. Settled is the rule that administrative offenses do not prescribe because by their very
nature, it pertain to the character of public officers and employees. In disciplining public officers, the
object sought is not the punishment of officer but the improvement of the public service and
preservation of the public faith and confidence in the government. Section 20(5) of RA No. 6770 does
not refer to the prescription of the offense but to the discretion given to the Ombudsman on whether
it would investigate a particular administrative offense.
2. YES. Andutan’s resignation divests the Ombudsman of its right to institute an

administrative complaint against him. Although the Ombudsman is not precluded from conducting
the investigation, the Ombudsman can no longer institute an administrative case against Andutan
because the latter was not a public servant at the time the case was filed. In the past, the Court have
held that a public resignation does not render moot an administrative case filed prior to the official’s
resignation since resignation is not a way out to evade administrative liability. This applies only if the
administrative complaint is filed before resignation. The Court disagreed with the Ombudsman
interpretation that as long as the breach of conduct was committed while the public official was still
in service, public servant’s resignation is not a bar to his administrative prosecution. This is
inconsistent with principal motivation of the law to improve public service and to preserve public’s
faith and confidence to in the government, and not the punishment of the public officer concerned.
ELOISA TOLENTINO v. ATTY. ROY LOYOLA, et al.

G.R. No. 153809, 27 July 2011, FIRST DIVISION (Leonardo- De Castro, J.)
Findings of fact of the Office of the Ombudsman are conclusive when supported by substantial
evidence and accorded due respect an weight, especially when they are affirmed by the Court of Appeals.
Eloisa Tolentino (Tolentino) filed a complaint charging Atty. Roy Loyola (Atty. Loyola), et al
with Violation of Section 3(e) of RA No. 3019 for Malversation of Public Funds through Falsification
of Public Documents and administratively, for Grave Misconduct, Dishonesty, Gross Neglect of Duty,
and Falsification of Official Documents. The complaint averred that Atty. Loyola as Municipal Mayor
requested the Sangguniang Bayan for the creation of 24 unappropriated positions for the inclusion in
the 1998 Plantilla. Sangguniang Bayan passed Municipal Resolution approving the creation of 19 out
of 24 requested positions. Despite disapproval, the aforesaid inexistent positions were filled up. The
appointment papers of the aforesaid personnel were subsequently approved by the Civil Service
Commission (CSC). Thereafter, payment of salaries were made. Tolentino alleged that inexistent
positions were created causing unlawful payment of salaries to illegally appointed employees. On the
other hand, Atty. Loyola, et al alleged that the Appropriate Ordinance carried with it the 24 positions
requested and that the appointments were approved by CSC. Deputy Ombudsman ordered the
dismissal of the administrative complaint for lack of merit. Court of Appeals (CA) affirmed the ruling
ISSUE:
Whether or not Atty. Loyola, et al should be dismissed from service for grave misconduct,
gross neglect of duty, dishonesty, and falsification of public documents
RULING:
NO. On a procedural note, the Ombudsman’s ruling possesses the character of finality, and
thus not subject to appeal. Under the old Section 7, Rule III of the Ombudsman Administrative Order
No. 9, Series of 1990, where the respondent is absolved of the charge, the decision shall be final and
unappealable. In the present case, Deputy Ombudsman ordered the dismissal of the administrative
complaint. The clear import of the mentioned Administrative Order is to deny complainant in
administrative complaint the right to appeal where Ombudsman exonerated the respondent of the
charge.
Also, settled is the rule that the findings of fact of the Office of the Ombudsman are conclusive
when supported by substantial evidence and accorded due respect an weight, especially when they
are affirmed by the Court of Appeals. The Court approved the findings and conclusion of Ombudsman
and CA. The Court believed that the questioned positions had been created under the circumstances.
Though the 4 positions had not been created by separate ordinance, its creation has been made when
the Sanggunian included them in the 1999 Annual Budget. The positions having been created,
personnel were appointed thereto which appointments were confirmed by the CSC. Since the
appointments were confirmed, all questions pertaining thereto has been rendered moot. Thus, Atty.
Loyola, et al did not commit grave misconduct, gross neglect of duty, dishonesty, and falsification of
public documents to warrant their dismissal.
MARCELO G. GANADEN, et al. v. THE HONORABLE COURT OF APPEALS, et al.

G.R. Nos.169359-61, 1 June 2011, THIRD DIVISION, (Villarama, Jr., J.)
It is worth stressing that the Ombudsman's finding of probable cause does not touch on the issue
of guilt or innocence of the accused. It is not the function of the Office of the Ombudsman to rule on such
issue. All that the Office of the Ombudsman did was to weigh the evidence presented together with the
counter-allegations of the accused and determine if there was enough reason to believe that a crime has
been committed and that the accused are probably guilty thereof.
A group of employees of the National Power Corp. filed a complaint accompanied by affidavits
and documents against Marcelo Ganaden et al. for various acts violative of the Anti-Graft and Corrupt
Practices Act. The Deputy Ombudsman for Luzon found probable cause to charge with violation of
the Anti-Graft and Corrupt Practices Act. Consequently, Ganaden et al. question the Office of the
Ombudsman’s act of finding probable cause to indict them for alleged violation of R.A. No. 3019 or
the Anti-Graft and Corrupt Practices Act for being done with grave abuse of discretion. They argue
that the complaints filed against them are purely intended for harassment
ISSUE:
Whether or not the Ombudsman committed grave abuse of discretion in finding probable
cause.
RULING:
NO. A finding of probable cause needs only to rest on evidence showing that more likely than
not a crime has been committed and there is enough reason to believe that it was committed by the
accused. It need not be based on clear and convincing evidence of guilt, neither on evidence
establishing absolute certainty of guilt. A finding of probable cause merely binds over the suspect to
stand trial. It is not a pronouncement of guilt. It is worth stressing that the Ombudsman's finding of
probable cause does not touch on the issue of guilt or innocence of the accused. It is not the function
of the Office of the Ombudsman to rule on such issue. All that the Office of the Ombudsman did was
to weigh the evidence presented together with the counter-allegations of the accused and determine
if there was enough reason to believe that a crime has been committed and that the accused are
probably guilty thereof. In this light, we find no compelling reason to disturb the findings of the Office
of the Ombudsman.
In the case at bar, the Office of the Ombudsman found sufficient reason to believe that a
violation of R.A. No. 3019 has been committed and that Ganaden et al. are probably guilty thereof.
The investigation resulted in several affidavits that indicate possible involvement of Ganaden et al.
in the alleged violation. All these allegations in the complaint coupled with the statements of several
key witnesses, among others, all point towards some kind of irregularity in the performance of public
works. Based on the assessment of the Office of the Ombudsman, there is sufficient reason to believe
that a violation of R.A. No. 3019 has been committed. Also, based on the evidence presented, there is
sufficient reason to believe that the accused public officials are probably guilty of the violation.
LABOR AND SOCIAL LEGISLATION
GENERAL PRINCIPLES
ELECTROMAT MANUFACTURING AND RECORDING CORPORATION v. HON. CIRIACO

LAGUNZAD, et al.
DO 40-03, issued pursuant to DOLE’s rule- making power which simplified the requirements for
the establishment of locals or charters, represents an expression of the government implementing policy
on trade unionism.
Nagkakaisang Samahan ng Manggawa ng Electronat-Wasto (Union), a charter affiliate of

Workers Advocate for Struggle, Transformation, and Organization (WASTO), applied for registration
with the Bureau of Labor Registration (BLR). The Union submitted documents in support for its
application. Thereafter, BLR issued a Certification of Local Chapter pursuant to Department Order No.
40-03. Electromat Manufacturing and Recording Corporation (Company) filed petition for
cancellation of the Union’s registration certificate for failure to comply with Article 234 of the Labor
Code. It argued that D.O. 40-03 is an unconstitutional diminution of the Labor Code’s union
registration requirements under Article 234. Acting Director Ciriaco Lagunzad of Department of
Labor and Employment dismissed the petition. On appeal, BLR Director affirmed the dismissal. The
Company elevated the case to Court of Appeals (CA) arguing that DO 40-03 delisted some of the
requirements under Article 234 of the Labor Code for registration of a local chapter. CA affirmed BLR
ruling brushing aside the company’s objection to DO 40-03. CA pointed out that it was issued by DOLE
pursuant to its rule-making power under the law.
ISSUE:
Whether or not issuance of D.O. 40-03 is a valid exercise of the rule-making power of DOLE
RULING:
YES. DO 40-03 represents an expression of the government implementing policy on trade

unionism. It simplified the requirements for the establishment of locals or charters. There is nothing
contrary to the law or Constitution in the adoption by the Secretary of Labor and Employment of DO
40-03 as this department order is consistent with the intent of the government to encourage
affiliation of a local union with a federation or national union to enhance the local’s bargaining power.
If changes were made at all, these were those made to recognize the distinctions made in the law itself
between federations and their local chapters, and independent unions; local chapters seemingly have
lesser requirements because they and their members are deemed to be direct members of the
federation to which they are affiliated. There is no compelling justification to nullify DO 40-03.
PABLO POLSOTIN, JR., et al. v. DE GUIA ENTERPRISES, INC.

G.R. No. 172624, 5 December 2011, FIRST DIVISION (Del Castillo, J.)
The dismissal of an employee’s appeal on purely technical ground is inconsistent with the constitutional
mandate on protection to labor. The Court has often set aside the strict application of procedural technicalities to
serve the broader interest of substantial justice.
Petitioners Pablo Polsotin, Jr., Arwin Rayala, Geronimo Limpante, Raul Domdom and Oscar Andrin
(Polsotin et al.) were bus drivers and conductors of respondent De Guia Enterprises, Inc. (De Guia). Alleging
that they were dismissed without cause and due process, Polsotin et al. filed a complaint for illegal dismissal
and payment of backwages and damages against De Guia before the NLRC. During the hearings set before the
Labor Arbiter, De Guia failed to appear despite due notice. It likewise failed to timely submit its position
paper. Thus, on the last hearing held, the case was submitted for decision. Thereafter, De Guia filed its position
paper without furnishing Polsotin et al. a copy of the same. The Labor Arbiter rendered a Decision dismissing
the complaint for lack of merit. It held that Polsotin et al. were validly terminated from employment for
violation of company rules and regulations as well as for gross and habitual neglect of duties as supported by
their employment records submitted by De Guia. The LA added that the procedural requirements for
dismissing Polsotin et al. were likewise satisfied.
Without the assistance of counsel, Polsotin et al., through Rayala as their representative, filed a
Memorandum of Appeal with the NLRC. The NLRC dismissed the appeal for failure of of Polsotin et al. to
append thereto a certificate of non-forum shopping and proof of service upon the other party. The NLRC then
affirmed the Decision appealed from. From this resolution, Polsotin et al. moved for reconsideration by
explaining that their lapses were due to their ignorance of the existence of the New Rules of Procedure of the
NLRC. The motion for reconsideration was however denied by the NLRC. On appeal to the Court of Appeals, it
implored the CA to be more liberal in the application of the rules of procedure considering that their dismissal
from service was effected without due process as they were not given ample opportunity to be heard and to
refute respondents allegations against them. The CA rendered a Decision denying due course and dismissing
the petition.
ISSUES:
1. Whether the petition should be given due course despite technicalities.

2. Whether Polsotin et al. were denied due process.
RULING:
1. YES. Petitioners appeal before the NLRC was dismissed purely on technical grounds as it did not
contain the required certification of non-forum shopping and proof of service upon the
respondent. Immediately, petitioners rectified these lapses by filing their motion for reconsideration
indicating therein that there was no intention on their part to commit forum shopping and that the registry
receipt showing proof of service upon respondent was attached to their Memorandum of Appeal filed with the
NLRC. With respect to their petition for certiorari with the CA, petitioners failed to affix their individual
signatures on top of their typewritten names in the verification and certification of non-forum shopping
attached to the petition. On this basis and on the conclusion that the NLRC did not commit grave abuse of
discretion in dismissing petitioners appeal on technical grounds, the CA denied due course to the petition and
dismissed the same. Note, however, that in both instances, petitioners were not represented by a lawyer. As
held in a case, a non-lawyer litigant cannot be expected to be well-versed on the rules of procedure as even the
most experienced lawyers get tangled in the web of procedure.
Aware that petitioners are not represented by counsel, the CA could have been more prudent by
giving petitioners time to engage the services of a lawyer or at least by reminding them of the importance of
retaining one. It is worthy to mention at this point that the right to counsel, being intertwined with the right to
due process, is guaranteed by the Constitution to any person whether the proceeding is administrative, civil
or criminal. The Court has often set aside the strict application of procedural technicalities to serve the broader
interest of substantial justice.
2. YES. A careful consideration of the facts of the case convinces us that petitioners appeal should have
been given due course. It may be recalled that respondent failed to timely submit its position paper when
required by the Labor Arbiter, hence, the case was submitted for decision sans the same. Nonetheless, when
respondent filed its position paper, the Labor Arbiter admitted the same and relied on it in coming up with a
decision that petitioners were validly terminated. More important is that petitioners were not even furnished
a copy of respondents position paper in order for them to refute the contents and allegations therein. And since
neither did respondent appear in any of the hearings conducted before the Labor Arbiter, petitioners were
never really afforded an opportunity to rebut respondents allegations and charges against them or to
introduce evidence to refute them. Petitioners right to due process was thus clearly violated.
Indeed, labor tribunals are mandated to use all reasonable means to ascertain the facts in each case
speedily, objectively and without regard to technicalities of law or procedure. However, in every proceeding
before it, the fundamental and essential requirements of due process should not to be ignored but must at all
times be respected. Besides, petitioners case concerns their job, considered as a property right, of which they
could not be deprived of without due process.
NATURE OF LABOR CASES

PTE., LTD.
G.R. No. 168922, 13 April 2011, FIRST DIVISION (Leonardo-De Castro, J.)
The burden of proof rests upon the party who asserts the affirmative of an issue. And in labor
cases, the quantum of proof necessary is substantial evidence, or such amount of relevant evidence which
a reasonable mind might accept as adequate to justify a conclusion.
Wilfredo Y. Antiquina (Antiquina) was hired, through respondent manning agency

Magsaysay Maritime Corporation (MMC), to serve as Third Engineer on the vessel, M/T Star
Langanger, which was owned and operated by respondent Masterbulk Pte., Ltd. (Masterbulk). During
a routine maintenance of the vessel, he suffered a fracture on his lower left arm after a part fell down
on him. Subsequently, he was signed off the vessel at Port Said, Egypt and was repatriated to the
Philippines. He immediately reported to the office of MMC and was referred to Dr. Robert Lim of the
Metropolitan Hospital. Dr. Lim subsequently issued a medical report confirming that Antiquina has
an undisplaced fracture of the left ulna. He was given medication and advised to return after two
weeks for repeat x-ray and re-evaluation.
After one month, his cast was removed and he was advised to undergo physical therapy
sessions. Despite several months of physical therapy, Antiquina noticed that his arm still had not
healed and he had difficulty straightening his arm. Another company designated doctor, Dr. Tiong
Sam Lim, advised that he undergo a bone grafting procedure whereby a piece of metal would be
attached to the fractured bone. Upon learning from Dr. Tiong Sam Lim that the metal piece will only
be removed from his arm after one and a half years, Antiquina decided not to have the operation.
After formally informing respondents of his decision to forego the medical procedure
recommended by the company physician, Antiquina filed a complaint for permanent disability
benefits, sickness allowance, damages and attorneys fees against MMC. He asserted that he is entitled
to sickness allowance equivalent to his basic wage for 120 days as stipulated under Section 20 of the
POEA Standard Employment Contract. With respect to his claim for permanent disability benefits, he
claimed that, notwithstanding his own medical evidence regarding his disability grade, he was
entitled to the purportedly superior benefits provided for under Section 20.1.5 of MMC’s collective
bargaining agreement (CBA) with the Associated Marine Officers and Seamens Union of the
Philippines (AMOSUP). MMC contended that Antiquina’s monetary claims were premature by reason
of the latter’s refusal to undergo the operation recommended by the company designated physician.
The Labor Arbiter ruled in favor of Antiquina. The NLRC denied MMC’s appeal and
subsequently denied their motion for reconsideration. Undeterred, MMC filed a petition for certiorari
with the Court of Appeals. The CA held that MMC had already paid Antiquina his sickness allowance.
However, as it was undisputed that Antiquina suffered a work-related injury, it saw fit to award
medical unfitness benefits, based on the POEA Standard Contract of Employment and the finding of
petitioners own physician that the proper disability grade for petitioners injury was Grade 11 or
14.93%. The CA denied Antiquina’s motion for reconsideration.
ISSUES:
1. Whether the CA erred in not admitting and considering the evidence submitted by Antiquina
that he is a member of the AMOSUP and the Singapore Maritime Officers Union
2. Whether the Court may award medical unfitness benefits in accordance with the Masterbulk
Vessels Maritime Officers Agreement
RULING:
1. NO. Although petitioner was able to submit to the Court of Appeals copies of his
identification card as an AMOSUP member and a certification from AMOSUPs Legal Department that
he was a member of said union during the period of his employment on the M/T Star Langanger, he
still failed to present any copy of MMC’s supposed CBA with AMOSUP. What petitioner belatedly
presented on appeal appears to be a CBA between respondent Masterbulk and the Singapore
Maritime Officers Union, not AMOSUP. Article 20.1.5, or the stipulation regarding permanent medical
fitness benefits quoted in petitioners Position Paper and relied upon by the Labor Arbiter in his
decision, cannot be found in this CBA.
Masterbulk ostensibly committed in the CBA with a foreign union, Singapore Maritime
Officers Union, that it shall pay compensation for injuries of employee-union members through the
latter’s coverage in a group personal accident insurance policy under terms set out in Appendix IV of
the CBA. This contractual obligation is completely different from the cause of action set out in
petitioners Position Paper or the relief granted by the Labor Arbiter which was the purported
obligation of respondents under an alleged CBA with a local union to pay a specific amount of
permanent medical unfitness benefits.
2. NO. What is indubitable in this case is that petitioner alleged in his Position Paper that there
was a CBA with AMOSUP (a local union of which he was purportedly a member) which entitled him
to disability benefits in the amount of US$80,000.00. It is elementary that petitioner had the duty to
prove by substantial evidence his own positive assertions. He did not discharge this burden of proof
when he submitted photocopied portions of a different CBA with a different union.
In all, we find that the Court of Appeals committed no error in ruling that the Labor Arbiters
award of US$80,000.00 in disability benefits was unsupported by the evidence on record, even if we
take into consideration petitioners late documentary submissions. There is no cogent reason to
disturb the appellate courts finding that the only credible and competent bases for an award of
disability benefits to petitioner are the POEA Standard Contract of Employment and petitioners own
medical evidence that his disability grade is Grade 11 (14.93%). Thus, the Court of Appeals’
computation of petitioners permanent medical unfitness benefits in the amount of US$7,465.00 must
stand.
JOBEL ENTERPRISES AND/OR MR. BENEDICT LIM v. NATIONAL LABOR RELATIONS

COMMISSION AND ERIC MARTINEZ
G.R. No. 194031, 8 August 2011, SECOND DIVISION (Brion, J.)
The CA precipitately denied the petition for certiorari based on an overly rigid application of the
rules of procedure. In effect, it sacrificed substance to form in a situation where the petitioner’s recourse
was not patently frivolous or meritless. This is a matter of substantial justice in fact, a lack of it that we
should not allow to remain uncorrected.
Jobel Enterprises hired Eric Martinez, Sr. as driver. Martinez allegedly performed well during
the first few months of his employment, but later became stubborn, sluggish and often came late to
work. On January 27, 2005, Martinez had a fight with one of his co-employees and nephew, Roderick
Briones. The company’s proprietor, Benedict Lim, pacified the two and instructed Martinez to come
early the next day for an important delivery but Martinez did not report for work.
Martinez filed an illegal dismissal complaint, with money claims, against the Jobel Enterprises
and Lim. The Labor Arbiter ruled that Martinez had been illegally dismissed. Jobel Enterprises then
filed a memorandum of appeal and a motion to reduce bond before the National Labor Relations
Commission (NLRC).They also deposited a check for P100,000.00. The NLRC denied the company’s
motion to reduce bond and directed the posting of an additional cash or surety bond. The company
complied by but Martinez moved for the immediate dismissal of the appeal. The CA dismissed the
petition for the company’s failure to attach to the petition a duplicate original or certified true copy
of the assailed NLRC decision; the submitted copy was a mere photocopy, in violation of Section 3,
Rule 46, in relation to Section 1, Rule 65 of the Rules of Court. The CA also denied the motion for
reconsideration, to which the Jobel Enterprises attached a certified true copy of the assailed NLRC
decision.
ISSUE:
Whether or not the CA erred in dismissing the petition based solely on procedural issues or
lapses.
RULING:
YES. This case was dismissed on purely technical grounds at both the NLRC and the CA levels,
in total disregard of the merits of the case. The NLRC dismissed the company’s appeal for non-
perfection for its failure to substantially address the issue of failure to post the required appeal bond
pursuant to Section 6, Rule VI of the 2005 Revised Rules of Procedure of the NLRC. In summarily
throwing out the appeal, the NLRC apparently forgot that earlier, or on September 15, 2008, it gave
the company 10 unextendible days within which to file an additional cash or surety bond in the
amount of P432,892.93 when it denied the company’s motion to reduce bond. The NLRC even warned
that their failure to post the required bond shall result in the dismissal of the appeal for non-
perfection.
RIGHT TO EQUAL PROTECTION OF THE LAWS
CLAUDIO S. YAP v. THENAMARIS SHIPS MANAGEMENT and INTERMARE MARITIME

AGENCIES, INC.
G.R. No. 179532, 30 May 2011, SECOND DIVISION (Nachura, J.)
The clause or for three months for every year of the unexpired term, whichever is less provided
in the 5th paragraph of Section 10 of R.A. No. 8042 is unconstitutional for being violative of the rights of
Overseas Filipino Workers (OFWs) to equal protection of the laws.
Claudio S. Yap (Yap) was employed as electrician of the vessel, M/T SEASCOUT by Intermare
Maritime Agencies, Inc. (Intermare) in behalf of its principal, Vulture Shipping Limited. However, the
vessel was subsequently sold. Yap, along with the other crew members, was informed by the Master
of their vessel that the same was sold and will be scrapped. Yap received his seniority bonus, vacation
bonus, extra bonus along with the scrapping bonus. However, with respect to the payment of his
wage, he refused to accept the payment of one-month basic wage. He insisted that he was entitled to
the payment of the unexpired portion of his contract since he was illegally dismissed from
employment. He alleged that he opted for immediate transfer but none was made. Intermare for their
part, contended that Yap was not illegally dismissed. They alleged that following the sale of the M/T
SEASCOUT, Yap signed off from the vessel and was paid his wages corresponding to the months he
worked or until plus his seniority bonus, vacation bonus and extra bonus.
Yap filed a complaint for Illegal Dismissal with Damages and Attorneys Fees before the Labor
Arbiter (LA) claiming that he was entitled to the salaries corresponding to the unexpired portion of
his contract. Subsequently, he filed an amended complaint, impleading Captain Francisco Adviento
of Intermare Maritime Agencies, Inc. and Thenamaris Ships Management (Thenamaris), together
with C.J. Martionos, Interseas Trading and Financing Corporation, and Vulture Shipping
Limited/Stejo Shipping Limited.
The LA rendered a decision in favor of Yap. Moreover, the LA found that respondents acted
in bad faith when they assured petitioner of re-embarkation and required him to produce an
electrician certificate during the period of his contract, but actually he was not able to board one
despite of respondents numerous vessels. The NLRC affirmed the findings of Illegal Dismissal but
held that there can be no choice to grant only three (3) months salary for every year of the unexpired
term because there is no full year of unexpired term which this can be applied. On appeal to the CA,
it affirmed the findings and ruling of the LA and the NLRC that petitioner was constructively and
illegally dismissed. However, it held ruled that the NLRC erred in sustaining the LAs interpretation
of Section 10 of R.A. No. 8042. While this case was pending before the Supreme Court, it declared as
unconstitutional the clause or for three months for every year of the unexpired term, whichever is
less provided in the 5th paragraph of Section 10 of R.A. No. 8042 in the case of Serrano v. Gallant
Maritime Services, Inc.
ISSUE:
Whether the 5th paragraph of Section 10 of R.A. No. 8042 is applicable in the computation of
Yap’s money claims.
RULING:
NO. Verily, we have already declared in Serrano that the clause or for three months for every
year of the unexpired term, whichever is less provided in the 5th paragraph of Section 10 of R.A. No.
8042 is unconstitutional for being violative of the rights of Overseas Filipino Workers (OFWs) to
equal protection of the laws. Moreover, this Court held therein that the subject clause does not state
or imply any definitive governmental purpose; hence, the same violates not just therein petitioners
right to equal protection, but also his right to substantive due process under Section 1, Article III of
the Constitution. Consequently, petitioner therein was accorded his salaries for the entire unexpired
period of nine months and 23 days of his employment contract, pursuant to law and jurisprudence
prior to the enactment of R.A. No. 8042.
Following Serrano, we hold that this case should not be included in the aforementioned
exception. After all, it was not the fault of petitioner that he lost his job due to an act of illegal dismissal
committed by respondents. To rule otherwise would be iniquitous to petitioner and other OFWs, and
would, in effect, send a wrong signal that principals/employers and recruitment/manning agencies
may violate an OFWs security of tenure which an employment contract embodies and actually profit
from such violation based on an unconstitutional provision of law. Thus, Yap is awarded his salaries
for the entire unexpired portion of his employment contract consisting of nine months computed at
the rate of US$1,430.00 per month.
EMPLOYER-EMPLOYEE RELATIONSHIP
MARTICIO SEMBLANTE AND DUBRICK PILAR v. COURT OF APPEALS, 19THDIVISION, now

SPECIAL FORMER 19TH DIVISION, GALLERA DE MANDAUE /
SPOUSES VICENTE and MARIA LUISA LOOT
G.R. No. 196426, 15 August 2011, THIRD DIVISION (Velasco, Jr., J.)
The four-fold test of employment: (1) the selection and engagement of the employee; (2) the
payment of wages; (3) the power of dismissal; and (4) the power to control the employees conduct, which
is the most important element.
Marticio Semblante and Dubrick Pilar worked as a masiador and sentenciador, respectively,
of Spouses Vicente and Maria Luisa Loot. On November 14, 2003, Semblante and Pilar were denied
entry in the cockpit and were later informed that their services were terminated. Aggrieved,
Semblante and Pilar filed a complaint for illegal dismissal. Spouses Loot contend that the 2 were not
his employees but were actually associates of the spouses’ independent contractor. Furthermore,
Spouses claimed that Semblante and Pilar have no regular working time or day; that the 2 go to other
cockpits, and the identification cards given to them were issued to indicate they were free from the
normal entrance fee.
The Labor Arbiter (LA) ruled that Semblante and Pilar are regular employees of the spouses
since the former performed work that were necessary and indispensable to business of the latter.
Despite the belated filing of an appeal bond, the National Labor Relations Commission (NLRC) took
cognizance of the case and reversed the LA’s decision. This was later on affirmed by the Court of
Appeals.
ISSUE:
Whether or not Semblante and Pilar are employees of Spouses Loot.

RULING:
NO. Semblante and Pilar are not employees of Spouses Loot, since their relationship fails to
pass muster the four-fold test of employment mentioned in countless decisions: (1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power
to control the employees conduct, which is the most important element.
As found by both the NLRC and the CA, Spouses Loot had no part in Semblante and Pilar’s
selection and management; their compensation was paid out of the arriba (which is a percentage
deducted from the total bets), not by the Spouses; and Semblante and Pilar performed their functions
as masiador and sentenciador free from the direction and control of the Spouses. In the conduct of
their work, Semblante and Pilar relied mainly on their expertise that is characteristic of the cockfight
gambling, and were never given by Spouses Loot any tool needed for the performance of their work.
Spouses Loot, not being Semblante and Pilar’s employers, could never have dismissed them, legally
or illegally, since the Spouses were without power or prerogative to do so in the first place.
Control
GREGORIO V. TONGKO v. THE MANUFACTURERS LIFE INSURANCE CO. (PHILS.), INC. and
RENATO A. VERGEL DE DIOS
G.R. No. 167622, 25 January 2011, EN BANC (Brion, J.)
Codes of conduct are norms or standards of behavior rather than employer directives into how
specific tasks are to be done.
Gregorio V. Tongko (Tongko) started his professional relationship with Manufacturers Life
Insurance Co. (Manulife) on 1 July 1997. According to the Career Agent Agreement (Agreement)
entered into by Tongko and Manulife, the former is merely an agent and an independent contractor
of the latter, and nothing in the Agreement should be construed as creating an employer-employee
relationship between Manulife and Tongko. Tongko was later promoted as Unit Manager of
Manulife's Sales Agency Organization and, eventually, he was named Branch Manager. In 2001,
Renato A. De Dios (De Dios), the President of Manulife, addressed a letter to Tongko regarding the
poor performance of Tongko's Region and his ability to lead the group. In sum, the management was
disappointed with how Tongko has not been proactive when it came to the growth of the agency. The
letter likewise ordered him to hire an assistant who can unload him of the routinary tasks, so that he
can focus on other tasks. A few months later, De Dios wrote another letter to Tongko, terminating the
latter's services. Tongko filed a complaint for illegal dismissal against Manulife.
The Labor Arbiter (LA) dismissed Tongko's complaint, ruling that no employer-employee
relationship existed between the parties. The National Labor Relations Commission (NLRC) reversed
the LA's ruling, finding that there was an employer-employee relationship existing between Tongko
and Manulife, and that the latter had illegally dismissed him. The Court of Appeals (CA) reverted to
the ruling of the LA. In its 2008 Decision, the Supreme Court held that there is an employer-employee
relationship between Manulife and Tongko.
ISSUE:
Whether an employer-employee relationship exists between Manulife and Tongko.

RULING:
NO. For his defense, Tongko points to the Code of Conduct for Agents and the Manulife
Financial Code of Conduct that allegedly serves as Manulife’s way of controlling his activities.
However, guidelines indicative of labor law “control” do not merely relate to the mutually desirable
result intended by the contractual relationship; they must have the nature of dictating the means and
methods to be employed in attaining the result. Codes of conduct are norms or standards of behavior
rather than employer directives into how specific tasks are to be done. These codes, as well as
insurance industry rules and regulations, are not per se indicative of labor law control under present
jurisprudence.
Tested by this norm, Manulife’s instructions regarding the objectives and sales targets, in
connection with the training and engagement of other agents, are among the directives that the
principal may impose on the agent to achieve the assigned tasks. They are targeted results that
Manulife wishes to attain through its agents. Manulife’s codes of conduct, likewise, do not necessarily
intrude into the insurance agents’ means and manner of conducting their sales. Therefore, as there is
no evidence of the labor law concept of control on the part of Manulife, Tongko cannot be considered
its employee.
AQUINAS SCHOOL v. SPS. JOSE INTON and MA. VICTORIA S. INTON, et al.
G.R. No. 184202, 26 January 2011, SECOND DIVISION (Abad, J.)
Control refers to the right of the employer, whether actually exercised or reserved, to control the
work of the employee as well as the means and methods by which he accomplishes the same.
Sister Margarita Yamyamin (Yamyamin), a religion teacher at Aquinas School (Aquinas),

taught Jose Luis Inton's (Jose Luis) grade three religion class. On 14 July 1998, while she was writing
on the blackboard, Jose Luis left his seat and went over to his classmate to surprise him. Yamyamin
noticed this and told Jose Luis to return to his seat. After a few moments, Jose Luis went returned to
his classmate's seat. This time, Yamyamin approached Jose Luis and kicked him on the legs several
times. He also pulled and shoved his head on his classmate's seat. As a result of the incident, Jose and
Victoria Inton (spouses Inton) filed an action for damages on behalf of Jose Luis against Yamyamin.
When spouses Inton elevated the matter before the Court of Appeals (CA), they sought to hold
Aquinas solidarily liable with Yamyamin, to which the CA granted.
The school directress testified that Aquinas had an agreement with a congregation of sisters
under which, in order to fulfill its ministry, the congregation would send religion teachers to Aquinas
to provide catechesis to its students. Aquinas insists that it was not the school but Yamyamin’s
religious congregation that chose her for the task of catechizing the school’s grade three students,
much like the way bishops designate the catechists who would teach religion in public schools.
ISSUE:
Whether Yamyamin is Aquinas’ employee.
RULING:
NO. The “four-fold test” is used to determine the existence of an employer-employee
relationship. Under this test, the employer (a) selects and engages the employee; (b) pays his wages;
(c) has power to dismiss him; and (d) has control over his work. Of these, the most crucial is the
element of control. Control refers to the right of the employer, whether actually exercised or
reserved, to control the work of the employee as well as the means and methods by which he
accomplishes the same. Under the circumstances, considering that it was the congregation who chose
Yamyamin for the position of religion teacher, it was quite evident that Aquinas did not have control
over Yamyamin’s teaching methods. The spouses Inton had not refuted the school directress’
testimony in this regard. Consequently, it was error for the CA to hold Aquinas solidarily liable with
Yamyamin.
CESAR C. LIRIO, doing business under the name and style of CELKOR AD SONICMIX v.
WILMER D. GENOVIA
G.R. No. 169757, 23 November, 2011, THIRD DIVISION (PERALTA, J.)
The power of control refers merely to the existence of the power. It is not essential for the
employer to actually supervise the performance of duties of the employee, as it is sufficient that the
former has a right to wield the power.
Wilmer Genovia (Genovia) filed a complaint against Cesar Lirio (Lirio) and/or Celkor Ad
Sonicmix Recording Studio for illegal dismissal, non-payment of commission and award of moral and
exemplary damages. Genovia alleged that he was illegally dismissed as he was terminated without
any valid grounds, and no hearing was conducted before he was terminated, in violation of his
constitutional right to due process. Having worked for more than six months, he was already a regular
employee. Although he was a so called studio manager, he had no managerial powers, but was merely
an ordinary employee. He prayed for his reinstatement without loss of seniority rights, or, in the
alternative, that he be paid separation pay, backwages and overtime pay; and that he be awarded
unpaid commission in the amount of P2,000.00 for services rendered as a studio technician as well
as moral and exemplary damages.
On the other hand, Lirio asserted that his relationship with Genovia is one of an informal
partnership under Article 1767 of the New Civil Code, since they agreed to contribute money,
property or industry to a common fund with the intention of dividing the profits among themselves.
Lirio had no control over the time and manner by which Genovia composed or arranged the songs,
except on the result thereof. Genovia reported to the recording studio between 10:00 a.m. and 12:00
noon. Hence, Lirio contended that no employer-employee relationship existed between him and the
Genovia, and there was no illegal dismissal to speak of.
The Labor Arbiter rendered a decision finding that an employer-employee relationship

existed between the parties and that Genovia was illegally dismissed. The NLRC reversed and set
aside the decision of the Labor Arbiter stating that Genovia failed to prove his employment tale with
substantial evidence. On appeal to the Court of Appeals, it rendered a decision reversing and setting
aside the resolution of the NLRC, and reinstating the decision of the LA, with modification in regard
to the award of commission and damages. The Court of Appeals deleted the award of commission,
and moral and exemplary damages as the same were not substantiated.
ISSUE:
Whether an employer-employee relationship existed between the parties.

RULING:
YES. Before a case for illegal dismissal can prosper, it must first be established that an
employer-employee relationship existed between petitioner and respondent. The elements to
determine the existence of an employment relationship are: (a) the selection and engagement of the
employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employers power to
control the employees conduct. The most important element is the employers control of the
employees conduct, not only as to the result of the work to be done, but also as to the means and
methods to accomplish it. It is settled that no particular form of evidence is required to prove the
existence of an employer-employee relationship. Any competent and relevant evidence to prove the
relationship may be admitted.
In this case, the documentary evidence presented by respondent to prove that he was an
employee of petitioner are as follows: (a) a document denominated as "payroll" (dated July 31, 2001
to March 15, 2002) certified correct by petitioner, which showed that respondent received a monthly
salary of P7,000.00 (P3,500.00 every 15th of the month and another P3,500.00 every 30th of the
month) with the corresponding deductions due to absences incurred by respondent; and (2) copies
of petty cash vouchers, showing the amounts he received and signed for in the payrolls.
The said documents showed that petitioner hired respondent as an employee and he was
paid monthly wages of P7,000.00. Petitioner wielded the power to dismiss as respondent stated that
he was verbally dismissed by petitioner, and respondent, thereafter, filed an action for illegal
dismissal against petitioner. The power of control refers merely to the existence of the power. It is
not essential for the employer to actually supervise the performance of duties of the employee, as it
is sufficient that the former has a right to wield the power. Nevertheless, petitioner stated in his
Position Paper that it was agreed that he would help and teach respondent how to use the studio
equipment. In such case, petitioner certainly had the power to check on the progress and work of
respondent.
On the other hand, petitioner failed to prove that his relationship with respondent was one
of partnership. Such claim was not supported by any written agreement. The Court notes that in the
payroll dated July 31, 2001 to March 15, 2002, there were deductions from the wages of respondent
for his absence from work, which negates petitioners claim that the wages paid were advances for
respondents work in the partnership.
Probationary Employment
HACIENDA PRIMERA DEVELOPMENT CORPORATION and ANNA KATRINA E. HERNANDEZ v.

MICHAEL S. VILLEGAS
G.R. No. 186243, 11 April 2011, SECOND DIVISION (Nachura J.)
There are two grounds to legally terminate a probationary employee. It may be done either: a)
for a just cause; or b) when the employee fails to qualify as a regular employee in accordance with
reasonable standards made known by the employer to the employee at the start of the employment.
Hacienda Primera Development Corporation (Hacienda) hired respondent Michael S. Villegas

(Villegas) as General Manager of Amorita Resort. He was hired as a probationary employee for three
(3) months starting January 2007. Villegas started working for petitioner on January 1, 2007. On
March 14, 2007, he received a call from Paramount Consultancy and Management telling him to
report back to Manila. There, he learned that his services were terminated. He, thus, asked for a
written notice of termination, but did not receive any. Hence, the complaint for illegal dismissal.
Hacienda, on the other hand, stated that Villegas was hired as probationary employee. It
explained that his services were terminated because he failed to qualify for regular employment.
Specifically, it claimed that Villegas failed to conceptualize and complete financial budgets, sales
projection, room rates, website development, and marketing plan in coordination with the Sales and
Marketing Manager. The Labor Arbiter rendered a decision in favor of Villegas. On appeal to the
NLRC, it dismissed the charge of illegal dismissal and instead, ordered Hacienda to pay Villegas his
salary corresponding to the unexpired portion of his contract of employment. The CA however set
aside the NLRC decision and reinstated that of the LA.
ISSUE:
Whether Villegas was illegally dismissed.
RULING:
YES. There are two grounds to legally terminate a probationary employee. It may be done
either: a) for a just cause; or b) when the employee fails to qualify as a regular employee in
accordance with reasonable standards made known by the employer to the employee at the start of
the employment.
In this case, petitioner Hacienda fails to specify the reasonable standards by which
respondents alleged poor performance was evaluated, much less to prove that such standards were
made known to him at the start of his employment. Thus, he is deemed to have been hired from day
one as a regular employee. Due process dictates that an employee be apprised beforehand of the
condition of his employment and of the terms of advancement therein. In Secon Philippines, Ltd. v.
NLRC, Orient Express Placement Phils. v. NLRC, and Davao Contractors Development Cooperative
(DACODECO) v. Pasawa, we did not sustain the employee’s dismissal for failure of the employer to
apprise them of the reasonable standards they needed to comply with for their continued
employment.
St. PAUL COLLEGE QUEZON CITY et al. v. REMIGIO MICHAEL A. ANCHETA II AND CYNTHIA A.
ANCHETA
G.R. No. 169905, 7 September 2011, THIRD DIVISION, (Peralta, J.)
Contract of probationary employment must specify the period or term of its effectivity.
Spouses Remigio Michael A. Ancheta II and Cynthia A. Ancheta (Spouses Ancheta) are
probationary teacher and part-time teacher, respectively at St. Paul College, Quezon City (SPCQC), a
private Catholic educational institution headed by its President, Sr. Lilia Therese Tolentino (Sr. Lilia),
the College Dean, Sr. Bernadette Racadio, SPC, and the Mass Communication Program Director, Sr.
Sarah Manapol, SPC. In 1998, Spouses Ancheta Ancheta wrote Sr. Lilia a letter manifesting their
intention to renew their employment contract with SPCQC for SY 1998-1999. In the letters sent by
Sr. Bernadette, the school extended new employment contract of Spouses Ancheta. Later, member of
the faculty of the SPCQC, including Spouses Ancheta wrote a letter to Sr. Bernadette containing their
sentiments regarding the policies of the school particularly with the policy of penalizing the delay in
encoding final grades and the policy of withholding salaries of the teachers. Thereafter, Sr.
Bernadette wrote a letter to Sr. Lilia endorsing the immediate termination of the teaching services of
Spouses Ancheta enumerating the grounds of their termination. Spouses Ancheta were given the
opportunity to explain however they were terminated.
Spouses Ancheta then filed a complaint for illegal dismissal with the NLRC however the Labor
Arbiter dismissed the same for lack of merit. On appeal, the NLRC affirmed the decision of the LA.
Upon the denial of their motion for reconsideration, Spouses Ancheta elevated the case to the CA via
petition for certiorari. The CA reversed the decision of the NLRC and LA. This prompted St. Paul to
appeal before the SC arguing that the employment contract of Spouses Ancheta expired hence they
were not illegally dismissed.
ISSUES:
1. Whether or not St. Paul extended the contracts of Spouses Ancheta

2. Whether or not Spouses Ancheta were illegally terminated.
RULING:
1. NO. Section 91 of the Manual of Regulations for Private Schools, states that every contract
of employment shall specify the designation, qualification, salary rate, the period and nature of
service and its date of effectivity, and such other terms and condition of employment as may be
consistent with laws and rules, regulations and standards of the school.
It is important that the contract of probationary employment must specify the period or term
of its effectivity. The failure to stipulate its precise duration could lead to the inference that the
contract is binding for the full three-year probationary period. Therefore, the letters sent by
petitioner Sr. Racadio, which were void of any specifics cannot be considered as contracts. The closest
they can resemble to are that of informal correspondence among the said individuals. As such,
petitioner school has the right not to renew the contracts of the respondents, the old ones having
been expired at the end of their terms.
2. NO. Assuming, arguendo, that the employment contracts between the petitioner school and
the respondent spouses were renewed, this Court finds that there was a valid and just cause for their
dismissal.
The plain admissions of the charges against them were the considerations taken into account
by the St. Paul in their decision not to renew the Spouses Ancheta's employment contracts. This is a
right of the school that is mandated by law and jurisprudence. It is the prerogative of the school to
set high standards of efficiency for its teachers since quality education is a mandate of the
Constitution. As long as the standards fixed are reasonable and not arbitrary, courts are not at liberty
to set them aside. Schools cannot be required to adopt standards which barely satisfy criteria set for
government recognition. The same academic freedom grants the school the autonomy to decide for
itself the terms and conditions for hiring its teacher, subject of course to the overarching limitations
under the Labor Code. The authority to hire is likewise covered and protected by its management
prerogative – the right of an employer to regulate all aspects of employment, such as hiring, the
freedom to prescribe work assignments, working methods, process to be followed, regulation
regarding transfer of employees, supervision of their work, lay-off and discipline, and dismissal and
recall of workers.
TAMSONS ENTERPRISES, INC., NELSON LEE, LILIBETH ONG and JOHNSON NG vs. COURT OF
APPEALS and ROSEMARIE L. SY
GR No. 192881, 16 November 2011, THIRD DIVISION, (Mendoza, J)
A probationary employee’s employment is terminated only upon a clear showing that he did not
qualify to the standards required.
On September 1, 2006, Rosemarie Sy was hired by Tamsons as Assistant to the

President. Despite the title, Sy did not act as such because, per instruction of Nelson Lee, she was
directed to act as payroll officer, though she actually worked as a payroll clerk. On February 24,
2007, four days before she completed her sixth month of working in Tamsons, Johnson Ng, the Sales
Project Manager, called her to a meeting with him and Lee. During the meeting, they informed Sy that
her services would be terminated due to inefficiency. She was asked to sign a letter of resignation
and quitclaim. She was told not to report for work anymore because her services were no longer
needed.
Sy filed a case for illegal dismissal with claims for back wages, unpaid salary, service incentive
leave, overtime pay, 13th month pay, and moral and exemplary damages, and attorney’s fees. The
Labor Arbiter found Sy’s termination to be arbitrary and illegal. On appeal, the NLRC reversed the
LA’s finding that Sy was terminated without just cause and without due process and dismissed the
case. On appeal, the CA rendered the assailed decision reversing the NLRC.
ISSUE:
Whether the termination of Sy, a probationary employee was valid
RULING:
NO. There is probationary employment where the employee upon his engagement is made to
undergo a trial period during which the employer determines his fitness to qualify for regular
employment based on reasonable standards made known to him at the time of engagement. There is
no dispute that Sys employment with Tamson’s on September 1, 2006 was probationary in character.
As a probationary employee, her employment status was only temporary. Although a probationary
or temporary employee with a limited tenure, she was still entitled to a security of tenure.
In this case, the justification given by the petitioners for Sys dismissal was her alleged failure
to qualify by the company’s standard. Other than the general allegation that said standards were
made known to her at the time of her employment, however, no evidence, documentary or otherwise,
was presented to substantiate the same. Neither was there any performance evaluation presented to
prove that indeed hers was unsatisfactory. For failure of the petitioners to support their claim of
unsatisfactory performance by Sy, Sy’s employment was unjustly terminated to prevent her from
acquiring a regular status in circumvention of the law on security of tenure.
Project Employment
LEYTE GEOTHERMAL POWER PROGRESSIVE EMPLOYEES UNION- ALU- TUCP v. PHILIPPINE

NATIONAL OIL COMPANY- ENERGY DEVELOPMENT CORPORATION
G.R. No. 170351, 30 March 2011, SECOND DIVISION (Nachura, J.)
In project employment, an employee is deemed to understand that his employment is co-
terminous with the project. Project employee may not expect to be employed continuously beyond the
completion of the project.
Philippine National Oil Company- Enegry Development Corporation (PNOC-EDC), engaged in

exploration, development, and utilization of energy resources, has a geothermal project, the Leyte
Geothermal Power Project. PNOC-EDC hired and employed hundreds of employees on contractual
basis, whereby, employment was only good up to completion or termination of the project and would
automatically expire upon completion of such project. Many of the employees hired had become
members of Leyte Geothermal Power Progressive Employees Union-ALU-TUCP (Union). In view of
this, the Union demanded for recognition of it as collective bargaining agent but PNOC-EDC did not
heed. When the project was about to be completed, PNOC-EDC served notice of termination upon
employees who were members of the Union. The Union filed a notice of strike and on the same day,
staged a strike. Secretary of Labor intervened and certified the case for compulsory arbitration. NLRC
ruled that the officers and members of Union were project employees.Court of Appeals (CA) affirmed
NLRC decison.
ISSUE:
Whether or not officers and members of Union are project employees of PNOC-EDC.
RULING:
YES. Union contended that the activities performed were necessary and desirable to PNOC-
EDC and that there was no interval in the employment contract of its officers and members. The Court
disagreed with the view of the Union. Article 280 of the Labor Code provided for different types of
employment: a) regular employees or those who have been engaged to perform activities which are
usually necessary or desirable in the usual business of employer; b) project employees or those
whose employment has been fixed for a specific period or undertaking, the completion or termination
of which has been determined at the time of the engagement of the employee; c) seasonal employees
or those who work or perform which are seasonal in nature; and d) casual employees or those who
are not regular, project, or seasonal employee. In project employment, an employee is deemed to
understand that his employment is coterminous with the project. Project employee may not expect
to be employed continuously beyond the completion of the project. There are two kinds of project
employee based on type of activities: a) employees in a project that refer to a particular job or
undertaking that is within regular or usual business of the employer company, but separate and
identifiable as such from other undertakings of the company and b) employees in a project wherein
the undertaking is not within the regular business of employer. The test to determine whether an
individual is a project employee lies in setting a fixed period of employment involving specific
undertaking which completion or termination has been determined at the time of employee’s
engagement.
In the case at bar, records reveal that officers and members of Union signed the employment
contracts indicating specific project or phase of work for which they were hired, with fixed period of
employment. They were hired as project employees for Geothermal Power Project. Consequently,
upon the completion of the project or substantial phase thereof, the officers and members of Union
could be validly terminated. Also, the fact that they were hired for more than a year does not make
them regular employee. The one year period to qualify as regular employee refers only to casual
employee and not to project employee.
Managerial Employment
CLIENTLOGIC PHILPPINES, INC. et al. v. BENEDICT CASTRO

G.R. No. 186070, 11 April 2011, SECOND DIVISION (Nachura, J.)
The test of supervisory or managerial status depends on whether a person possesses authority
to act in the interest of his employer and whether such authority is not merely routinary or clerical in
nature, but requires the use of independent judgment.
Benedict Castro (Castro) was employed by ClientLogic Philippines, Inc. (now known and shall
hereafter be referred to as SITEL) as a call center agent for its Bell South Account. After six (6)
months, he was promoted to the Mentor position, and thereafter to the Coach position. Therafter, he
was transferred to the Green Dot Account. During Castro’s stint at the Dot Green Account, he received
a notice requiring him to explain why he should not be penalized for: (1) violating Green Dot
Company’s Policy and Procedure for Direct Deposit Bank Info Request when he accessed a customer’s
online account and then gave the latter’s routing and reference numbers for direct deposit; and (2)
gravely abusing his discretion when he requested for the medical records of his team members.
Castro did not deny the infractions imputed against him. He, however, justified his actuations by
explaining that the customer begged him to access the account because she did not have a computer
or an internet access and that he merely requested for a patient tracker, not medical records.
A poster showing SITEL’s organizational chart was posted on the company’s bulletin board,
but Castro’s name and picture were conspicuously missing, and the name and photo of another
employee appeared in the position which he was supposedly occupying. Thereafter, SITEL posted a
notice of vacancy for Castro’s position and thereafter, he received a Notice of Termination. Castro
filed a complaint for illegal dismissal; non-payment of overtime pay, rest day pay, holiday pay, service
incentive leave pay; full backwages; damages; and attorney’s fees.
The LA ruled in favor of Castro by declaring him illegally dismissed and ordering SITEL to pay
his full backwages and, in lieu of reinstatement, his separation pay. The LA further awarded
respondents money claims upon finding that he was not occupying a managerial position. On appeal
to the NLRC, it reversed and set aside the decision of the LA by dismissing the complaint for lack of
merit on the ground that Castro’s employment was terminated for a just cause. The NLRC failed to
discuss the money claims.The Court of Appeals affirmed the NLRC’s ruling finding that there was no
illegal dismissal. Anent the money claims, the CA concurred with the LA’s ruling. Castro’s failure to
partially appeal the CA’s Decision finding him not illegally dismissed has now rendered the same final
and executory. SITEL appealed the issue on money claims.
ISSUE:
Whether Castro, a team supervisor, was a member of the managerial staff, hence not
entitled to overtime pay, rest day pay, holiday pay, and service incentive leave pay.
RULING:
NO. The test of supervisory or managerial status depends on whether a person possesses
authority to act in the interest of his employer and whether such authority is not merely routinary or
clerical in nature, but requires the use of independent judgment. The position held by respondent
and its concomitant duties failed to hurdle this test.
As a coach or team supervisor, respondent’s main duty was to deal with customer complaints
which could not be handled or solved by call center agents. If the members of his team could not meet
the needs of a customer, they passed the customers call to respondent. This job description does not
indicate that respondent can exercise the powers and prerogatives equivalent to managerial actions
which require the customary use of independent judgment. Petitioners themselves described
respondent as the superior of a call center agent; he heads and guides a specific number of agents,
who form a team. From the foregoing, respondent is thus entitled to his claims for holiday pay, service
incentive leave pay, overtime pay and rest day pay, pursuant to Book Three of the Labor Code,
specifically Article 82, in relation to Articles 87, 93, and 95 thereof.
RECRUITMENT
Employment Agency
JONES INTERNATIONAL MANPOWER SERVICES, INC. v. BELLA AGCAOILI-BARIT

The Agency cannot be made liable for alleged unpaid salaries because of its failure to present
payslips or payrolls. The argument that absent the payslips, the agency failed to present proof of
payment should be viewed in the context of realistic domestic service ---there was very little or no
paperwork at all, even on wage payments.
Bella Agcaoili- Barit (Barit) entered into a two-year employment contract with Jones
International Manpower Services, Inc. (Agency) for its foreign principal in Kingdom of Saudi Arabia,
Mohamad Hameed Al- Naimi (Hameed), as domestic helper. She claimed that she was not paid the
agreed salary and later on not paid at all. She extended her employment for another 10 months upon
Hameed’s request, but the latter refused to pay her even during the extension. Fed up with the
situation, she left Hameed and lived with her boyfriend. As the law of Saudi Arabia prohibits such
relationship, Barit was arrested and imprisoned for more than a year. Upon arriving in the
Philippines, she demanded payment for her unpaid salary and refund of her airfare. In defense, the
Agency argued that the contract of employment expired without any complaint from her and that she
left her employer without permission. She was subsequently arrested and imprisoned, but Hameed
was helpless in providing Barit assistance because she violated marital law. Her passport, air ticket,
and balance of unpaid salaries were turned over to Saudi authorities. The Agency also denied liability
for the unpaid salaries during extension of contract to which it had no participation.
Labor Arbiter (LA) found Barit’s money claims during the two-year contract meritorious, but
absolved the Agency of liability during the extended employment as it did not intervene in securing
the extended posting. National Labor Relations Commision (NLRC) set aside LA’s ruling but awarded
Barit financial assistance for reasons of equity. On appeal, Court of Appeals (CA) upheld LA award to
Barit.
ISSUE:
Whether or not the Agency is liable to the unpaid salaries of Barit.
RULING:
NO. Nowhere in the records does it appear that Barit complained about the alleged
underpayment and non- payment of her wages with the Philippine labor or consular representatives
in Saudi Arabia, or even with Saudi authorities themselves. She also left her employer not because
she was being exploited but for personal reason. There is substantial basis to believe that Barit
received her full salaries for the entire duration of her original contract. In light of the exchange of
letters between the Agency and Hameed and the real reason why Barit left employment, the Court is
convinced that Barit has been paid her salaries in full. The argument that absent the payslips, the
agency failed to present proof of payment should be viewed in the context of realistic domestic
service. The service of Barit is largely confined within Hameed’s household. There was very little or
no paperwork at all, even on wage payments. Just like our local domestic helpers who receive wages
directly without any payslips, the Court cannot expect the case of Barit to be any different. To make
the agency liable for alleged unpaid wages on the sole ground that it failed to present payslips is unfair
as the agency appears to have taken all available means to secure necessary documents from Hameed
to dispute Barit’s claims.
Illegal Recruitment
DELIA D. ROMERO v. PEOPLE OF THE PHILIPPINES, et al.

G.R. No. 171644, 23 November 2011, THIRD DIVISION (Peralta, J.)
The crime of illegal recruitment is committed when two elements concur, namely: (1) the
offender has no valid license or authority required by law to enable one to lawfully engage in
recruitment and placement of workers; and (2) he undertakes either any activity within the meaning of
"recruitment and placement" defined under Article 13 (b), or any prohibited practices enumerated
under Article 34 of the Labor Code.
After being caught by Israel’s immigration police and subsequently being deported for not
possessing working visas, private respondents Romulo Padlan (Padlan) and Arturo Siapno (Siapno)
filed a complaint for the crime of illegal recruitment against Delia D. Romero (Romero). Padlan and
Siapno alleged that upon checking with the Department of Labor and Employment (DOLE) Dagupan
District Office, they found out that Romero was not authorized to recruit for overseas employment.
The prosecution presented the testimonies of Padlan and Siapno. Romero, on the other hand,
offered her own testimony, as well as Satchi Co Pontaces to prove that she did not recruit Padlan and
Siapno. According to Romero, the two went to her to inquire about the working status of her sister
in Israel. She told them that her sister was doing well. When the two asked her how her sister was
able to go to Israel, Romero told them that she does not know and that she will have to ask her sister
about that matter. Romero then called her sister and told her that the two wanted to ask for her help
in going to Israel. It was Romero’s sister and Padlan and Siapno who communicated with each other,
and Romero had no knowledge as to the content of the former's conversations and agreements. The
RTC found Romero guilty as charged. On appeal,the CA affirmed in toto the decision of the RTC.
ISSUE:
Whether Romero is guilty of the crime of illegal recruitment.
RULING:
YES. The crime of illegal recruitment is committed when two elements concur, namely: (1)
the offender has no valid license or authority required by law to enable one to lawfully engage in
recruitment and placement of workers; and (2) he undertakes either any activity within the meaning
of "recruitment and placement" defined under Article 13 (b), or any prohibited practices enumerated
under Article 34 of the Labor Code.
In disputing the absence of the first element, petitioner offers her opinion that the CA erred
in affirming the trial court's reliance on a mere certification from the DOLE Dagupan District Office
that she does not have the necessary license to recruit workers for abroad. She claims that the
prosecution committed a procedural lapse in not procuring a certification from the agency primarily
involved, the Philippine Overseas Employment Administration (POEA). The said argument, however,
is flawed.
Under the first element, a non-licensee or non-holder of authority is any person, corporation
or entity which has not been issued a valid license or authority to engage in recruitment and
placement by the Secretary of Labor, or whose license or authority has been suspended, revoked or
cancelled by the POEA or the Secretary. Clearly, the creation of the POEA did not divest the Secretary
of Labor of his/her jurisdiction over recruitment and placement of activities. The governing rule is
still Article 35 of the Labor Code. Thus, the trial court did not err in considering the certification from
the DOLE-Dagupan District Office stating that petitioner has not been issued any license by the POEA
nor is a holder of an authority to engage in recruitment and placement activities.
Anent the second element, petitioner insists that the CA was wrong in affirming the factual
findings of the trial court. According to her, the accommodation extended by the petitioner to the
private respondents is far from the referral as contemplated in Article 13 (b) of the Labor Code.
The testimonies of the private respondents clearly establish the fact that petitioner's conduct
falls within the term recruitment as defined by law. It is apparent that petitioner was able to convince
the private respondents to apply for work in Israel after parting with their money in exchange for
the services she would render. The said act of the petitioner, without a doubt, falls within the
meaning of recruitment and placement as defined in Article 13 (b) of the Labor Code.
As to petitioner's contention that the testimony of Arturo Siapno that the latter paid a certain
amount of money to the former must not be given any credence due to the absence of any receipt or
any other documentary evidence proving such, the same is without any merit. In People v.
Alvarez, this Court ruled that in illegal recruitment cases, the failure to present receipts for money
that was paid in connection with the recruitment process will not affect the strength of the evidence
presented by the prosecution as long as the payment can be proved through clear and convincing
testimonies of credible witnesses.
PEOPLE OF THE PHILIPPINES v. TERESITA “TESSIE” LAOGO

G.R. No. 176264, 10 January 2011, THIRD DIVISION (Villarama, Jr., J.)
To prove illegal recruitment, it must be shown that the accused, without being duly authorized
by law, gave complainants the distinct impression that he had the power or ability to send them abroad
for work, such that the latter were convinced to part with their money in order to be employed.
Teresita Laogo (Laogo), the proprietor and manager of Laogo Travel Consultancy (LTC), and
Susan Navarro (Navarro), was charged with the crime of Large Scale Illegal Recruitment. The case
originated when Navarro invited seven individuals to her house and convinced them that she could
help them find work abroad. Pursuant to her instruction, one of the applicants, Teodulo dela Cruz
(Dela Cruz), gave her PhP3,000 in order to process his application for work abroad. Navarro then
accompanied Dela Cruz to LTC and introduced him to Laogo. He paid an additional PhP 15,000 for
the placement fee. In turn, a receipt bearing the logo and name of Laogo Travel Consultancy was
issued to him signed by Laogo. However, several months later, Laogo's promises to send him abroad
remained unfulfilled. The other individuals invited and referred by Navarro to Laogo had similar
complaints against her.
For her defense, Laogo denied any participation in the illegal activities undertaken by
Navarro. She insisted that Navarro was not in any way connected with her travel agency.
Notwithstanding her arguments, both the Regional Trial Court (RTC) and Court of Appeals (CA) found
her guilty of large scale illegal recruitment.
ISSUE:
Whether or not Laogo is guilty of illegal recruitment.
RULING:
YES. To prove illegal recruitment, it must be shown that the accused, without being duly
authorized by law, gave complainants the distinct impression that he had the power or ability to send
them abroad for work, such that the latter were convinced to part with their money in order to be
employed. It is important that there must at least be a promise or offer of an employment from the
person posing as a recruiter, whether locally or abroad.
In this case, Dela Cruz and the other victims were promised to be sent abroad for work by
Navarro and Laogo. The follow up transactions between Laogo and her victims were done inside the
said travel agency. Moreover, all four receipts issued to the victims bear the name and logo of Laogo
Travel Consultancy, with the said receipts personally signed by appellant herself. Indubitably, Laogo
and Navarro acting together made Dela Cruz and the other private complainants believe that they
were transacting with a legitimate recruitment agency and that Laogo Travel Consultancy had the
authority to recruit them and send them abroad for work when in truth and in fact it had none as
certified by the Philippine Overseas Employment Administration (POEA).
PEOPLE OF THE PHILIPPINES v. DOLORES OCDEN

It is not necessary for the prosecution to present a certification that Ocden is a non-licensee or
non-holder of authority to lawfully engage in the recruitment and placement of workers. Section 6 of
Republic Act No. 8042 enumerates particular acts which would constitute illegal recruitment whether
committed by any person, whether a non-licensee, non-holder, licensee or holder of authority.
Dolores Ocden (Ocden) was charged with estafa and illegal recruitment in large scale. Ocden
allegedly recruited people to work as factory workers in Italy. She received applications and
documents and collected placement fees from the applicants despite not being a licensed recruiter.
In her defense, Ocden denied recruiting private complainants and claimed that she was also
an applicant for an overseas job in Italy, just like them. Ocden identified one Erlinda Ramos as the
recruiter. Ocden recounted that she met Ramos at a seminar attended by about 60 applicants
wherein Ramos explained how one could apply as worker in a stuff toys factory in Italy. After the
seminar, Ocden decided to apply for the overseas job, so she gave her passport and pictures to
Ramos. Ocden also underwent medical examination at Zamora Medical Clinic in Manila, and
completely submitted the required documents to Ramos. After the seminar, many people went to
Ocden’s house to inquire about the jobs available in Italy. Since most of these people did not attend
the seminar, Ocden asked Ramos to conduct a seminar at Ocden’s house. Two seminars were held at
Ocden’s house, and after said seminars, Ramos designated Ocden as leader of the applicants. As such,
Ocden received her co-applicants’ applications and documents; accompanied them to Manila for
medical examination because she knew the location of Zamora Medical Clinic; and accepted
placement fees in the amount of P70,000.00 each from Mana-a and Ferrer and from Golidan, the
amount of P140,000.00 (for Jeffries and Howard).
The RTC rendered a Decision finding Ocden guilty beyond reasonable doubt of the crimes of
illegal recruitment in large scale and three counts of estafa. On appeal, the Court of Appeals affirmed
Ocden’s conviction but modified the penalties imposed upon her for the three counts of estafa. Ocden
contends that the prosecution failed to prove beyond reasonable doubt that she is guilty of the crime
of illegal recruitment in large scale. Other than the bare allegations of the prosecution witnesses, no
evidence was adduced to prove that she was a non-licensee or non-holder of authority to lawfully
engage in the recruitment and placement of workers. No certification attesting to this fact was
formally offered in evidence by the prosecution.
ISSUE:
Whether Ocden is guilty of illegal recruitment in large scale.
RULING:
YES. It is well-settled that to prove illegal recruitment, it must be shown that appellant gave
complainants the distinct impression that he had the power or ability to send complainants abroad
for work such that the latter were convinced to part with their money in order to be employed. As
testified to by Mana-a, Ferrer, and Golidan, Ocden gave such an impression through the following
acts: (1) Ocden informed Mana-a, Ferrer, and Golidan about the job opportunity in Italy and the list
of necessary requirements for application; (2) Ocden required Mana-a, Ferrer, and Golidans sons,
Jeffries and Howard, to attend the seminar conducted by Ramos at Ocdens house in Baguio City; (3)
Ocden received the job applications, pictures, bio-data, passports, and the certificates of previous
employment (which was also issued by Ocden upon payment of P500.00), of Mana-a, Ferrer, and
Golidans sons, Jeffries and Howard; (4) Ocden personally accompanied Mana-a, Ferrer, and Golidans
sons, Jeffries and Howard, for their medical examinations in Manila; (5) Ocden received money paid
as placement fees by Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, and even issued receipts
for the same; and (6) Ocden assured Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, that
they would be deployed to Italy.
It is not necessary for the prosecution to present a certification that Ocden is a non-licensee
or non-holder of authority to lawfully engage in the recruitment and placement of workers. Section
6 of Republic Act No. 8042 enumerates particular acts which would constitute illegal
recruitment whether committed by any person, whether a non-licensee, non-holder, licensee or
holder of authority. Among such acts, under Section 6(m) of Republic Act No. 8042, is the [f]ailure to
reimburse expenses incurred by the worker in connection with his documentation and processing
for purposes of deployment, in cases where the deployment does not actually take place without the
workers fault.
Ocden further argues that the prosecution did not sufficiently establish that she illegally
recruited at least three persons, to constitute illegal recruitment on a large scale. Under the last
paragraph of Section 6, Republic Act No. 8042, illegal recruitment shall be considered an offense
involving economic sabotage if committed in a large scale, that is, committed against three or more
persons individually or as a group. While it is true that the law does not require that at least three
victims testify at the trial, nevertheless, it is necessary that there is sufficient evidence proving that
the offense was committed against three or more persons. In this case, there is conclusive evidence
that Ocden recruited Mana-a, Ferrer, and Golidans sons, Jeffries and Howard, for purported
employment as factory workers in Italy.
SECURITY OF TENURE
SUPREME STEEL CORPORATION v. NAGKAKAISANG MANGGAGAWA NG SUPREME

INDEPENDENT UNION (NMS-IND-APL)
It is settled that where from the circumstances it is apparent that the periods of employment
have been imposed to preclude acquisition of security of tenure by employee, it should be struck down
or disregarded as contrary to public policy and morals.
NMS-IND-APL filed a notice of strike with the National Conciliation and Meditiation Board
(NCMB) on the ground that Supreme Steel Corporation failed to comply with certain provisions of the
CBA. Secretary of Labor certified the case for compulsory arbitration. The union contended that
Supreme Steel Corporation violated several CBA provisions and one of them is the provision on
prohibition of contracting out of work of members of bargaining unit. The union claimed that
Supreme Steel Corporation hired temporary workers for five months, renewable. It further alleged
that persistent refusal of the corporation to grant regular status to its employee violates the right of
employees’ right to self- organization in two ways: a) they are deprived of a representative for
collective bargaining purposes and b) union is deprived the right to expand its membership. For its
part, the corporation admitted hiring temporary workers. It purportedly did so to cope with the
seasonal increase of the jobs from abroad. It claimed that it offered the job to regular employees but
they refused and that it is part of management prerogative. National Labor Relations Commission
(NLRC) order to regularize workers and ordered the corporation to respect the CBA provision on
contracting out. The Court of Appeals (CA) held that management prerogative is not unlimited since
subject to limitations found in law, CBA, and general principles of fair play and justice. It stressed that
CBA provision provded such limitation on management prerogative to contract out labor, and
compliance with the CBA is mandated by law.
ISSUE:
Whether or not Supreme Steel Corporation may contract out work although CBA provision
provided limitation for such
RULING:
NO. Jurisprudence recognizes the right to exercise management prerogative. However, the
exercise is not unlimited. CBA is clear that employees will no longer be allowed in the company except
in the Warehouse and Packing Section. The company is bound by this provision. It cannot exempt
itself from compliance by invoking management prerogative. The company claimed that temporary
employees were hired on five month-contracts, renewable for another five months. After expiration
of contract, the company would hire other persons for the same work with same employment status.
Plainly, the scheme seeks to prevent employees from acquiring the status of regular employees. It is
settled that where from the circumstances it is apparent that the periods of employment have been
imposed to preclude acquisition of security of tenure by employee, it should be struck down or
disregarded as contrary to public policy and morals. The primary standard to determine a regular
employment is the reasonable connection between the particular activity performed by employee in
relation to the business of the employer.
NIPPON HOUSING PHIL. INC., AND/OR TADAHI OTA, HOROSHI TAKADA, et al. v. MAIAH
ANGELA LEYNES
G.R. No. 177816, 3 August 2011, SECOND DIVISION (Perez, J.)
The right of employees to security of tenure does not give them vested rights to their positions
to the extent of depriving management of its prerogative to change their assignments or to transfer
them.
Maiah Leynes was employed by Nippon Housing Phil. Inc. (NHPI) as its Project Manager. The
controversy started when Leynes had a misunderstanding with NHPI’s Building Engineer, Honesto
Cantuba which resulted in Leynes’ ordering the security guards to bar Cantuba from entering the
premises and sending a letter to NHPI’s Human Resources Department informing it of Cantuba’s
supposed insubordination. But Hiroshi Takada, NHPI’s Vice President, directed that Cantuba be
allowed to report back to work. Thereafter, Leynes expressed her intention to resign through a letter
addressed to NHPI’s President asking for an emergency leave so that she can coordinate with her
counsel regarding the matter. Consequently, NHPI hired the services of Carlos Jose as Property
Manager to replace Leynes. Leynes called off her planned resignation and upon her return, she was
maintained on floating status.
Aggrieved, Leynes filed a complaint for illegal dismissal against NHPI and its officers. The
Labor Arbiter found NHPI guilty of illegal dismissal. But the National Labor Relations Commission
(NLRC) reversed the decision. Upon appeal, the Court of Appeals (CA) reversed the NLRC decision
based on the absence of a bona fide suspension of NHPI’s business operations which makes Leynes’
relief from her position equivalent to constructive dismissal; there was bad faith on the part of NHPI
and its officers when they hired a replacement for Leynes’ position; and the failure of NHPI and its
officers to prove a just cause for Leynes’ termination, the redundancy of her services and their non-
compliance with the requirements of due process.
ISSUE:
Whether or not Leynes was illegally dismissed by NHPI on the ground of redundancy.
RULING:
NO. The evidence the parties adduced a quo clearly indicates that NHPI and its officers were
not in bad faith when they placed the former under floating status. Disgruntled by NHPI’s
countermanding of her decision to bar Engr. Cantuba from the Project, Leynes twice signified her
intention to resign from her position. Upon receiving the copy of the memorandum issued for Engr.
Cantubas return to work, Leynes inscribed thereon the following handwritten note addressed to
Ota, Good Morning! Im sorry but I would like to report to you my plan of resigning as your Prop.
Manager. Thank You. In her application letter for an immediate emergency leave, Leynes also
distinctly expressed her dissatisfaction over NHPI’s resolution of her dispute with Engr. Cantuba and
announced her plan of coordinating with her lawyer regarding her resignation letter.
RIGHT TO SELF-ORGANIZATION
Certification Election
LEGEND INTERNATIONAL RESORTS LIMITED v. KILUSANG MANGGAGAWA NG LEGEND

G.R. No. 169754, 23 February 2011, FIRST DIVISION (Del Castillo, J.)
An order to hold a certification election is proper despite the pendency of the petition for cancellation of
the registration certificate of the respondent union. The rationale for this is that at the time the respondent union
filed its petition, it still had the legal personality to perform such act absent an order directing the cancellation.
Kilusang Manggagawa ng Legend (KML) filed a petition for certification election which was
opposed by Legend International Resorts Limited. Legend claimed that KML cannot be considered as
a legitimate labor organization because it is composed of both rank and file and supervisory
employees which is prohibited by Article 245 of the Labor Code. Also, it alleged that KML committed
fraud when KML claimed that some of its employees attended the general membership meeting on a
certain date when in reality, only a few were able to attend.
The Med-Arbiter dismissed the petition for certification election. This, however, was reversed
by the Office of the Secretary of the Department of Labor and Employment (DOLE). DOLE opined that
the legitimacy of KML as a labor organization cannot be collaterally attacked in a petition for
certification election. When Legend filed its motion for reconsideration (MR), it claimed that it filed
a petition for cancellation of union registration of KML beforehand which was granted by the DOLE
Regional Office. But the Office of the Secretary of DOLE denied the MR on the ground that under
Section 11, paragraph II(a), Rule XI of Department Order No. 9 a final order of cancellation is required before
a petition for certification election may be dismissed on the ground of lack of legal personality. Moreover, the
decision of DOLE Regional Office in that case has been reversed by the Bureau of Labor Relations. The
decision of the DOLE was later affirmed by the Court of Appeals.
Legend argues, among others, that the cancellation of KMLs certificate of registration should retroact
to the time of its issuance. It thus claims that the petition for certification election and all of KMLs activities
should be nullified because it has no legal personality to file the same, much less demand collective bargaining
with LEGEND.
ISSUE/s:
1. Whether or not a petition for certification election and demand for collective bargaining can
proceed notwithstanding the pendency of a petition for cancellation.
2. Whether or not the legal personality of KML can be collaterally attacked in a petition for
certification election.
RULING:
1. YES. An order to hold a certification election is proper despite the pendency of the petition for
cancellation of the registration certificate of the respondent union. The rationale for this is that at the time
the respondent union filed its petition, it still had the legal personality to perform such act absent an order
directing the cancellation. In Capitol Medical Center, Inc. v. Hon. Trajano, we also held that the pendency of a
petition for cancellation of union registration does not preclude collective bargaining.
2. NO. The SC agreed agreed with the ruling of the Office of the Secretary of DOLE that the legitimacy of
the legal personality of KML cannot be collaterally attacked in a petition for certification election
proceeding. The Implementing Rules stipulate that a labor organization shall be deemed registered and
vested with legal personality on the date of issuance of its certificate of registration. Once a certificate of
registration is issued to a union, its legal personality cannot be subject to a collateral attack. It may be
questioned only in an independent petition for cancellation in accordance with Section 5 of Rule V, Book V of
the Implementing Rules.
SAMAHANG MANGGAGAWA SA CHARTER CHEMICAL SOLIDARITY OF UNIONS IN THE

PHILIPPINES FOR EMPOWERMENT AND REFORMS (SMCC-SUPER) v. CHARTER CHEMICAL and
COATING CORPORATION
G.R. No 169717, 16 March 2011, FIRST DIVISION (Del Castillo, J.)
The right to file a petition for certification election is accorded to a labor organization provided
that it complies with the requirements of law for proper registration. The inclusion of supervisory
employees in a labor organization seeking to represent the bargaining unit of ran-and-file employees
does not divest it of its status as a legitimate labor organization.
SMCC-SUPER (union) filed a petition for certification election among the regular rank-and-
file employees of Charter Chemical and Coating Corporation (Charter Chemical). The latter filed an
Answer with Motion to Dismiss on the ground that SMCC-SUPER is not a legitimate labor organization
because of failure to comply with documentation requirements and inclusion of supervisory
employees. The Med- Arbiter dismissed the petition of SMCC-SUPER because the Charter Certificate,
Sama-samang pahayag ng pagsapi at authorization, and Listahan ng mga dumalo sa pangkalahatang
pulong were not executed under oath and certified by secretary and attested by president. Med-
Arbiter further ruled that list of the union consisted of supervisory employees. The Department of
Labor and Employment (DOLE), on motion for reconsideration, allowed the certification election. On
review, Court of Appeals (CA) annulled DOLE’s decision giving credence to the findings of Med-
Arbiter.
ISSUE:
Whether or not the union is a legitimate labor organization having the personality to file
petition for certification election
RULING:
YES. First, the two documents presented which are not executed under oath and not certified
by secretary and attested by president are not among the documents that need to be submitted to the
Regional Office or Bureau of Labor Relations in order to register a labor organization. Also, the charter
certificate need not be under oath because a labor organization validly acquired the status of
legitimate labor organization upon submission of charter certificate, names of officers and addresses,
ans constitution and by laws.
Second, the mixture of the rank-and-file and supervisory employees does not nullify its legal
personality as legitimate labor organization. In the present case, the some of the supposed union
members are supervisory employees or one whose job actions are not merely routinary but require
an independent judgment. Nonetheless, the inclusion of said employees does not divest it of its status.
RA No. 6715 omitted the effect of any violation of the prohibition of mingling. While it is prohibited,
the code failed to provide for the effects in case of violation. Thus, after being registered, the union
may still exercise all the rights and privileges of labor organization. Mingling of supervisory and rank-
and-file is not among the grounds for cancellation if the tile unless such mingling was brought by
misrepresentation, false statement, or fraud under Article 239 of the Labor Code.
RIGHT TO COLLECTIVE BARGAINING
Union Registration
THE HERITAGE HOTEL MANILA v. NATIONAL UNION OF WORKERS IN THE HOTEL,

RESTAURANT AND ALLIED INDUSTRIES-HERITAGE HOTEL MANILA SUPERVISORS CHAPTER
G.R. No. 178296, 12 January 2011, SECOND DIVISION (Nachura, J.)
Labor authorities should, indeed, act with circumspection in treating petitions for cancellation
of union registration, lest they be accused of interfering with union activities.
The National Union of Workers in the Hotel, Restaurant and Allied Industries-Heritage Hotel
Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election with the
Department of Labor and Employment (DOLE). The petition was granted and it was referred to a pre-
election conference. The pre-election conference was not held as initially scheduled, but a year later.
The Heritage Hotel Manila (Heritage Hotel) moved to dismiss the petition due to the alleged
continued non-appearance of NUWHRAIN-HHMSC. Subsequently, Heritage Hotel filed a Petition for
the Cancellation of Registration when it discovered that NUWHRAIN-HHMSC failed to submit to the
Bureau of Labor Relations (BLR) its annual financial report for several years and the list of its
members since it filed its registration papers in 1995. Likewise, it prayed that NUWHRAIN-HHMSC's
Certificate of Creation of Local/Chapter be cancelled and its name be deleted from the list of
legitimate labor organizations. It further requested for the suspension of the certification election
proceedings. However, notwithstanding the request of NUWHRAIN-HHMSC, the certification
elections pushed through and NUWHRAIN-HHMSC emerged as the winner.
Heritage Hotel filed a Protest stating that the certification election held was an exercise in
futility because, once NUWHRAIN-HHMSC's registration is cancelled, it will no longer be certified to
be the exclusive bargaining representative (EBR) of the supervisory employees. NUWHRAIN-HHMSC
countered Heritage Hotel’s Protest by stating, among others, that it had submitted its financial
statements for the years 1996 to 1999, and its updated list of officers and members for the years
1995 to 1999. When the case reached the Regional Director (RD), he found that while NUWHRAIN-
HHMSC indeed failed in filing the financial reports and list of its members for several years, he,
nonetheless, found that the freedom of association and the employees’ right to self-organization are
more substantive consideration.
ISSUE:
Whether the failure to comply with the statutory requirements – such as the filing financial
reports and the list of union members – is a sufficient ground for the cancellaion of registration of
NUWHRAIN-HHMSC as a labor union.
RULING:
NO. Article 238 and 239 of the Labor Code provides for the grounds for the cancellation of a
union registration. However, these provisions give the RD ample discretion in dealing with a petition
for cancellation of a union’s registration -- particularly, in determining whether the union still meets
the requirements prescribed by law. It is sufficient to give the RD license to treat the late filing of
required documents as sufficient compliance with the requirements of the law. After all, the law
requires the labor organization to submit the annual financial report and list of members in order to
verify if it is still viable and financially sustainable as an organization so as to protect the employer
and employees from fraudulent or fly-by-night unions. With the submission of the required
documents by respondent, the purpose of the law has been achieved, though belatedly.
Labor authorities should, indeed, act with circumspection in treating petitions for
cancellation of union registration, lest they be accused of interfering with union activities. In
resolving the petition, consideration must be taken of the fundamental rights guaranteed by Article
XIII, Section 3 of the Constitution. As such, the cancellation of a certificate of registration is the
equivalent of snuffing out the life of a labor organization. For without such registration, it loses—as
a rule—its rights under the Labor Code.
CIRTEK EMPLOYEES LABOR UNION-FEDERATION OF FREE WORKERS v. CIRTEK

ELECTRONICS, INC.
G.R. No. 190515, 6 June 2011, THIRD DIVISION (Carpio-Morales, J.)
While an arbitral award cannot per se be categorized as an agreement voluntarily entered into
by the parties because it requires the interference and imposing power of the State thru the Secretary
of Labor when he assumes jurisdiction, the award can be considered as an approximation of a collective
bargaining agreement which would otherwise have been entered into by the parties.
Cirtek Electronics, Inc., (Cirtek Electronics) filed a motion for reconsideration and
supplemental motion for reconsideration of the Court’s Decision dated November 15, 2010. It avers
that Cirtek Employees Labor Union-Federation of Free Workers (Labor Union), in filing the petition
for certiorari under Rule 65, availed of the wrong remedy, hence, the Court should have dismissed
the petition outright. It goes on to aver that the Court erred in resolving a factual issue whether the
August 24, 2005 Memorandum of Agreement (MOA) was validly entered into, which is not the office
of a petition for certiorari. It further avers that the MOA signed by the remaining officers of petitioner
Union and allegedly ratified by its members should have been given credence by the Court.
Furthermore, Cirtek Electronics maintains that the Secretary of Labor cannot insist on a
ruling beyond the compromise agreement entered into by the parties; and that, as early as February
5, 2010, petitioner Union had already filed with the Department of Labor and Employment (DOLE) a
resolution of disaffiliation from the Federation of Free Workers resulting in the latter’s lack of
personality to represent the workers in the present case.
ISSUES:
1. Whether the case may be reviewed by the SC even if the labor union availed of the wrong
remedy
2. Whether the Secretary of Labor is empowered to give arbitral awards in the exercise of his
authority to assume jurisdiction over labor disputes
RULING:
1. YES. Respondent indeed availed of the wrong remedy of certiorari under Rule 65. Due,
however, to the nature of the case, one involving workers wages and benefits, and the fact that
whether the petition was filed under Rule 65 or appeal by certiorari under Rule 45 it was filed within
15 days (the reglementary period under Rule 45) from petitioner’s receipt of the resolution of the
Court of Appeals Resolution denying its motion for reconsideration, the Court resolved to give it due
course. Ineluctably, the issue involves a determination and application of existing law, the provisions
of the Labor Code, and prevailing jurisprudence. Intertwined with the issue, however, is the question
of validity of the MOA and its ratification which, as movant correctly points out, is a question of fact
and one which is not appropriate for a petition for review on certiorari under Rule 45. The rule,
however, is not without exceptions. In the present case, the findings of the Secretary of Labor and the
appellate court on whether the MOA is valid and binding are conflicting, the former giving scant
consideration thereon, and the latter affording it more weight.
2. YES. While an arbitral award cannot per se be categorized as an agreement voluntarily

entered into by the parties because it requires the interference and imposing power of the State thru
the Secretary of Labor when he assumes jurisdiction, the award can be considered as an
approximation of a collective bargaining agreement which would otherwise have been entered into
by the parties.Hence, it has the force and effect of a valid contract obligation between the parties. In
determining arbitral awards then, aside from the MOA, courts considered other factors and
documents including, as in this case, the financial documents submitted by respondent as well as its
previous bargaining history and financial outlook and improvements as stated in its own website.
On the contention that the MOA should have been given credence because it was validly
entered into by the parties, the Court notes that even those who signed it expressed reservations
thereto. A CBA (assuming in this case that the MOA can be treated as one) is a contract imbued with
public interest. It must thus be given a liberal, practical and realistic, rather than a narrow and
technical construction, with due consideration to the context in which it is negotiated and the
purpose for which it is intended. As for the contention that the alleged disaffiliation of the Union from
the FFW during the pendency of the case resulted in the FFW losing its personality to represent the
Union, the same does not affect the Court’s upholding of the authority of the Secretary of Labor to
impose arbitral awards higher than what was supposedly agreed upon in the MOA. Contrary to
respondents’ assertion, the unavoidable issue of disaffiliation bears no significant legal repercussions
to warrant the reversal of the Court’s Decision.
Attorney’s Fees in favor of Union Members
KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-EAST ZONE UNION

and EDUARDO BORELA, representing its members vs. MANILA WATER COMPANY, INC.
GR No. 147149, 16 November 2011, SECOND DIVISION, (Brion, J)
The ten percent attorney’s fees awarded by the NLRC on the basis of Article 111 of the Labor
Code accrue to the Unions members as indemnity for damages and not to the Unions counsel as
compensation for his legal services.
The Union is the duly-recognized bargaining agent of the rank-and-file employees of the
respondent Manila Water Company, Inc. while Borela is the Union President. On February 21, 1997,
the Metropolitan Waterworks and Sewerage System entered into a Concession Agreement with the
Company to privatize the operations of the MWSS. Article 6.1.3 of the Agreement provides that the
Concessionaire shall grant its employees benefits no less favorable than those granted to MWSS
employees at the time of their separation from MWSS. Among the benefits enjoyed by the employees
of the MWSS were the amelioration allowance and the cost-of-living allowance. The payment of the
AA and the COLA was discontinued pursuant to Republic Act No. 6758, otherwise known as the Salary
Standardization Law.
The Union demanded from the Company the payment of the AA and the COLA during the
renegotiation of the parties Collective Bargaining Agreement. This was not accepted by the
management. As a result, the Union and Borela filed on April 15, 2003 a complaint against the
Company for payment of the AA, COLA, moral and exemplary damages, legal interest, and attorney’s
fees before the National Labor Relations Commission. The Labor Arbiter ruled in favor of the Union,
On appeal, the NLRC affirmed the ruling of the LA. The CA likewise affirmed the decision but deleted
the order for MWCI to pay attorney’s fees.
ISSUE:
Whether the NLRC gravely abused its discretion in awarding ten percent attorney’s fees to
the Union
RULING:
NO. Article 111 of the Labor Code and Section 8, Rule VIII, Book III of its Implementing Rules
provides for the rules on granting attorney’s fees. In the present case, it is undisputed that the union
members are entitled to their AA benefits and that these benefits were not paid by the Company. That
the Company had no funds is not a defense as this was not an insuperable cause that was cited and
properly invoked. As a consequence, the union members represented by the Union were compelled
to litigate and incur legal expenses. On these bases, we find no difficulty in upholding the NLRCs
award of ten percent attorney’s fees.
The more significant issue in this case is the effect of the MOA provision that attorney’s fees
shall be deducted from the AA and CBA receivables. In this regard, the CA held that the additional
grant of 10% attorney’s fees by the NLRC violates Article 111 of the Labor Code, considering that the
MOA between the parties already ensured the payment of 10% attorney’s fees deductible from the
AA and CBA receivables of the Unions members. In the present case, the ten percent attorney’s fees
awarded by the NLRC on the basis of Article 111 of the Labor Code accrue to the Unions members as
indemnity for damages and not to the Unions counsel as compensation for his legal services, unless,
they agreed that the award shall be given to their counsel as additional or part of his compensation;
in this case the Union bound itself to pay 10% attorney’s fees to its counsel under the MOA and also
gave up the fees awarded to the Unions members in favor of their counsel. This is supported by
Borela’s affidavit which stated that “the 10% attorney’s fees paid by the members/employees is
separate and distinct from the obligation of the company to pay the 10% awarded attorney’s fees
which we also gave to our counsel as part of our contingent fee agreement.”
Collective Bargaining Agreement
GENERAL MILLING CORPORATION-INDEPENDENT LABOR UNION (GMC-ILU) v. GENERAL

MILLING CORPORATION / GENERAL MILLING CORPORATION v.
GENERAL MILLING CORPORATION-INDEPENDENT LABOR UNION (GMC-ILU), et al.
G.R. Nos. 183122 / 183889, 15 June 2011, FIRST DIVISION (Perez, J.)
The provisions of the imposed CBA continues to have full force and effect until a new CBA has
been entered into by the parties. Article 253 mandates the parties to keep the status quo and to continue
in full force and effect the terms and conditions of the existing agreement during the 60-day period prior
to the expiration of the old CBA and/or until a new agreement is reached by the parties.
General Milling Corporation (GMC) and the General Milling Corporation-Independent Labor
Union (the Union) entered into a collective bargaining agreement (CBA) which provided, among
other terms, the latter’s representation of the collective bargaining unit for a three-year term. A day
before the expiration of the subject CBA, the Union sent a draft CBA proposal to GMC, with a request
for counter-proposals from the latter, for the purpose of renegotiating the existing CBA between the
parties. In view of GMC’s failure to comply with said request, the Union commenced the complaint
for unfair labor practice which was dismissed for lack of merit in a decision dated 21 December 1993
by the Regional Arbitration Branch-VII (RAB-VII) of the National Labor Relations Commission
(NLRC). On appeal, said dismissal was reversed and set aside in a decision dated 30 January 1998
rendered by the Fourth Division of the NLRC ordering the imposition upon the GMC of the Union’s
draft CBA proposal for the remaining two years duration of the original CBA.
ISSUE:
Whether the imposed CBA has full force and effect considering that it was not agreed upon
by the union and GMC.
RULING:
YES. Considering that no new CBA had been, in the meantime, agreed upon by GMC and the
Union, we find that the CA’s Special Twentieth Division correctly ruled in CA-G.R. CEB-SP No. 02226
that, pursuant to Article 253 of the Labor Code, the provisions of the imposed CBA continues to have
full force and effect until a new CBA has been entered into by the parties. Article 253 mandates the
parties to keep the status quo and to continue in full force and effect the terms and conditions of the
existing agreement during the 60-day period prior to the expiration of the old CBA and/or until a
new agreement is reached by the parties. In the same manner that it does not provide for any
exception nor qualification on which economic provisions of the existing agreement are to retain its
force and effect, the law does not distinguish between a CBA duly agreed upon by the parties and an
imposed CBA like the one under consideration.
RIGHT TO PEACEFUL CONCERTED ACTIVITIES
Strike
YOLITO FADRIQUELAN, et al. v. MONTEREY FOODS CORPORATION / MONTEREY FOODS

CORPORATION v. BUKLURAN NG MGA MANGGAGAWA SA MONTEREY-ILAW AT BUKLOD NG
MANGGAGAWA, et al.
G.R. Nos. 178409/178434, 8 June 2011, SECOND DIVISION (Abad, J.)
No strike shall be declared after the Secretary of Labor has assumed jurisdiction over a labor
dispute. A strike conducted after such assumption is illegal and any union officer who knowingly
participates in the same may be declared as having lost his employment.
On April 30, 2002 the three-year collective bargaining agreement or CBA between the union
Bukluran ng Manggagawa sa Monterey-Ilaw at Buklod ng Manggagawa (the union) and Monterey
Foods Corporation (the company) expired. After the negotiation for a new CBA reached a deadlock,
the union filed a notice of strike with the National Conciliation and Mediation Board (NCMB). To head
off the strike, the company filed with the DOLE a petition for assumption of jurisdiction over the
dispute in view of its dire effects on the meat industry. The DOLE Secretary assumed jurisdiction over
the dispute and enjoined the union from holding any strike. It also directed the union and the
company to desist from taking any action that may aggravate the situation.
The union filed a second notice of strike before the NCMB on the alleged ground that the
company committed unfair labor practices. The company sent notices to the union officers, charging
them with intentional acts of slowdown. Six days later, the company sent new notices to the union
officers, informing them of their termination from work for defying the DOLE Secretary’s assumption
order. Acting on motion of the company, the DOLE Secretary included the union’s second notice of
strike in his earlier assumption order. But, on the same day, the union filed a third notice of strike
based on allegations that the company had engaged in union busting and illegal dismissal of union
officers. The company filed a petition for certification of the labor dispute to the National Labor
Relations Commission (NLRC) for compulsory arbitration but the DOLE Secretary denied the
motion. He, however, subsumed the third notice of strike under the first and second notices. The
DOLE rendered a decision that, among other things, upheld the company’s termination of the 17
union officers. On appeal to the CA, it rendered a decision upholding the validity of the company’s
termination of 10 union officers but declaring illegal that of the other seven. Both parties sought
recourse to the Supreme Court, the union in G.R. 178409 and the company in G.R. 178434.
ISSUES:
1. Whether slowdowns actually transpired at the companys farms.

2. Whether the union officers committed illegal acts that warranted their dismissal from work.
RULING:
1. YES. The law is explicit: no strike shall be declared after the Secretary of Labor has assumed
jurisdiction over a labor dispute. A strike conducted after such assumption is illegal and any union
officer who knowingly participates in the same may be declared as having lost his employment. The
Court finds that the union officers and members in this case held a slowdown strike at the companys
farms despite the fact that the DOLE Secretary had on May 12, 2003 already assumed jurisdiction
over their labor dispute. The evidence sufficiently shows that union officers and members
simultaneously stopped work at the companys Batangas and Cavite farms at 7:00 a.m. on May 26,
2003.
2. In termination cases, the dismissed employee is not required to prove his innocence of the
charges against him. The burden of proof rests upon the employer to show that the employees
dismissal was for just cause. The employer’s failure to do so means that the dismissal was not
justified. Here, the company failed to show that all 17 union officers deserved to be dismissed. The
Court sustains the validity of the termination of the rest of the union officers. The identity and
participations of Arturo Eguna, Armando Malaluan, Danilo Alonso, Romulo Dimaano, Roel
Mayuga, Wilfredo Rizaldo, Romeo Suico, Domingo Escamillas, and Domingo Bautro in the slowdowns
were properly established. These officers simply refused to work or they abandoned their work to
join union assemblies.
MAGDALA MULTIPURPOSE & LIVELIHOOD COOPERATIVE and SANLOR MOTORS CORP. v.
KILUSANG MANGGAGAWA NG LGS, MAGDALA MULTIPURPOSE & LIVELIHOOD CORPERATIVE
(KMLMS) and UNION MEMBERS/ STRIKERS
G.R. No. 151993, 19 October 2011, THIRD DIVISION (Peralta, J.)
A notice of strike and the conduct of the strike-vote report are ineffective if filed and conducted
before the union acquired legal personality as a legitimate labor organization. For union officers,
knowingly participating in an illegal strike is a valid ground for termination of their employment. But
for union members who participated in a strike, their employment may be terminated only if they
committed prohibited and illegal acts during the strike.
Kilusang Manggagawa ng LGS, Magdala Multipurpose and Livelihood Cooperative (KMLMS),

the union operating in Magdala Multipurpose & Livelihood Cooperative and Sanlor Motors Corp, filed
a notice of strike on March 5, 2002 and conducted its strike-vote on April 8, 2002. However, KMLMS
only acquired legal personality when the Department of Labor and Employment (DOLE) granted its
registration as an independent labor organization April 9, 2002. Thereafter, on May 6, 2002, KMLMS,
now a legitimate labor organization (LLO), staged a strike where several prohibited and illegal acts
were committed by its participating members.
Magdala filed a petition to declare the strike illegal on the ground of lack of valid notice of
strike, ineffective conduct of a strike-vote and commission of prohibited and illegal acts. Magdala
prayed that the officers and members of respondent KMLMS who participated in the illegal strike
and who knowingly committed prohibited and illegal activities, respectively, be declared to have lost
or forfeited their employment status. The Labor Arbiter (LA) declared the strike illegal. The National
Labor Relations Commission (NLRC) and the Court of Appeals (CA) affirmed.
ISSUES:
Whether or not the employees who participated in the strike lost their employment status
because KMLMS’ strike was illegal.
RULING:
YES. First, because when KMLMS filed the notice of strike on March 5 or 14, 2002, it had not
yet acquired legal personality and, thus, could not legally represent the eventual union and its
members. And second, similarly when KMLMS conducted the strike-vote on April 8, 2002, there was
still no union to speak of, since KMLMS only acquired legal personality as an independent LLO only
on April 9, 2002 or the day after it conducted the strike-vote. These factual findings are undisputed
and borne out by the records. Consequently, the mandatory notice of strike and the conduct of the
strike-vote report were ineffective for having been filed and conducted before KMLMS acquired legal
personality as an LLO.
There is likewise no dispute that when the May 6, 2002 illegal strike was conducted, the
members of respondent KMLMS committed prohibited and illegal acts which doubly constituted the
strike illegal. the striking workers committed acts of (1) interference by obstructing the free ingress
to or egress from petitioners compound and (2) coercion and intimidation.
Art. 264 of the Code presents a substantial distinction of the consequences of an illegal strike
between union officers and mere members of the union. For union officers, knowingly participating
in an illegal strike is a valid ground for termination of their employment. But for union members who
participated in a strike, their employment may be terminated only if they committed prohibited and
illegal acts during the strike and there is substantial evidence or proof of their participation, i.e., that
they are clearly identified to have committed such prohibited and illegal acts. The May 6, 2002 strike
is illegal for non-compliance with provisions of law and its implementing rules. Consequently, the
termination of employment of the 14 union officers is proper. In the case of union members who
participated in the May 6, 2002 strike and committed prohibited and illegal acts of interference by
obstructing the free ingress to or egress from petitioners compound, coercion and intimidation, the
forfeiture of their employment is also proper.
UNFAIR LABOR PRACTICES
PRINCE TRANSPORT, INC. and RENATO CLAROS v. DIOSDADO GARCIA, et al.

G.R. No. 167291, 12 January 2011, SECOND DIVISION (Peralta, J.)
An employer is guilty of ULP if it interferes with, restrains or coerces its employees in the exercise
of their right to self-organization or if it discriminates in regard to wages, hours of work and other terms
and conditions of employment in order to encourage or discourage membership in any labor
organization.
Diosdado Garcia, Luisito Garcia, Rodante Romero, and several other employees (Garcia, et al.)
of Prince Transport, Inc. (PTI) filed cases of illegal dismissal and unfair labor practice (ULP), among
others, against the company. According to Garcia, et al., their commissions were reduced to 7 to 9%
from the original 8 to 10%. This led them to hold a series of meetings to discuss the protection of
their interests as employees. Renato Claros (Claros), the president of PTI, did not want Garcia, et al.
to form a union, however, notwithstanding his reservations about it, the latter still formed a union
for their mutual aid and protection. In order to block the continued formation of the union, PTI caused
the transfer of all union members and sympathizers to one of its sub-companies, Lubas Transport
(Lubas). Notwithstanding this transfer, the schedule of the drivers and conductors, as well as their
company IDs were issued by PTI. All claims for salaries were also transacted at PTI.
Later on, the business of Lubas deteriorated because of the refusal of PTI to maintain and
repair the units being used, which resulted in the virtual stoppage of its operations and the loss of
employment of Garcia, et al.. PCI, on the other hand, claimed that Garcia, et al were transferred to
Lubas at their own request, and that it had no hand in the management and operation of Lubas, as
well as the control and supervision of its employees.
ISSUE:
Whether PCI is guilty of ULP.
RULING:
YES. Under Article 248 (a) and (e) of the Labor Code, an employer is guilty of ULP if it
interferes with, restrains or coerces its employees in the exercise of their right to self-organization
or if it discriminates in regard to wages, hours of work and other terms and conditions of employment
in order to encourage or discourage membership in any labor organization. Indeed, evidence of PTI’s
ULP is shown by the established fact that, after Garcia, et al’s transfer to Lubas, PTI left them high and
dry insofar as the operations of Lubas were concerned. It withheld the necessary financial and logistic
support such as spare parts, and repair and maintenance of the transferred buses until only two units
remained in running condition. This left Garcia, et al virtually jobless.
Corporate Entities
PRINCE TRANSPORT, INC. and RENATO CLAROS v. DIOSDADO GARCIA, et al.

A settled formulation of the doctrine of piercing the corporate veil is that when two business
enterprises are owned, conducted and controlled by the same parties, both law and equity will, when
necessary to protect the rights of third parties, disregard the legal fiction that these two entities are
distinct and treat them as identical or as one and the same.
Diosdado Garcia, Luisito Garcia, Rodante Romero, and several other employees (Garcia, et al.)
of Prince Transport, Inc. (PTI) filed cases of illegal dismissal and unfair labor practice (ULP), among
others, against the company. According to Garcia, et al., their commissions were reduced to 7 to 9%
from the original 8 to 10%. This led them to hold a series of meetings to discuss the protection of
their interests as employees. Renato Claros (Claros), the president of PTI, did not want Garcia, et al.
to form a union, however, notwithstanding his reservations about it, the latter still formed a union
for their mutual aid and protection. In order to block the continued formation of the union, PTI caused
the transfer of all union members and sympathizers to one of its sub-companies, Lubas Transport
(Lubas). Notwithstanding this transfer, the schedule of the drivers and conductors, as well as their
company IDs were issued by PTI. All claims for salaries were also transacted at PTI.
Later on, the business of Lubas deteriorated because of the refusal of PTI to maintain and
repair the units being used, which resulted in the virtual stoppage of its operations and the loss of
employment of Garcia, et al.. PCI, on the other hand, claimed that Garcia, et al were transferred to
Lubas at their own request, and that it had no hand in the management and operation of Lubas, as
well as the control and supervision of its employees.
ISSUE:
Whether Lubas is an entity separate and independent from PTI.
RULING:
NO. A settled formulation of the doctrine of piercing the corporate veil is that when two
business enterprises are owned, conducted and controlled by the same parties, both law and equity
will, when necessary to protect the rights of third parties, disregard the legal fiction that these two
entities are distinct and treat them as identical or as one and the same.
In this case, it may be true that Lubas is a single proprietorship and not a corporation.
However, PTI’s attempt to isolate itself from and hide behind the supposed separate and distinct
personality of Lubas so as to evade their liabilities is precisely what the classical doctrine of piercing
the veil of corporate entity seeks to prevent and remedy. Indeed, if Lubas was truly a separate entity,
it makes no sense that it was PTI who made the decision to transfer its employees to the former.
Furthermore, PTI never regarded Lubas as a separate entity. Therefore, Lubas is a mere agent,
conduit or adjunct of PTI.
TERMINATION
JUST CAUSES
Loss of Confidence
JAMES BEN L. JERUSALEM v. KEPPEL MONTE BANK, et al.

G.R. No. 169564, 6 April 2011, FIRST DIVISION (Del Castillo, J.)
Loss of confidence as a just cause for termination of employment is premised on the fact that the
employee concerned holds a position of responsibility or trust and confidence. He must be invested with
confidence on delicate matters, such as custody handling or care and protection of the property and assets of
the employer. And, in order to constitute a just cause for dismissal, the act complained of must be work-related
and shows that the employee concerned is unfit to continue to work for the employer.
James Ben L. Jerusalem (James) was employed by Keppel Monte Bank (Keppel) as Assistant Vice-
President. Carrying the same rank, James was reassigned as Head of the Marketing and Operations of the
Jewelry Department. In 1999, James received from one Jorge Javier (Jorge), a Keppel Visa Card Holder, a sealed
envelope containing VISA Card application forms which he immediately handed over to the VISA Credit Card
Unit. All in all, the VISA credit card applications referred by Jorge which James forwarded to the VISA Credit
Card Unit numbered 67, all of which were subsequently approved. As it turned out, all the accounts under
these approved applications became past due. Later on, James received a Notice to Explain from Keppel’s Vice
President for Operations, why no disciplinary action should be taken against him for referring/endorsing
fictitious VISA card applicants. The said referrals resulted in substantial financial losses to Keppel. In his
written explanation, James pointed out that he had no participation in the processing of the VISA card
applications since he was no longer connected with the VISA Credit Card Unit at the time of such
transactions. He explained that he can only endorse the applications referred by Jorge to the VISA Credit Card
Unit because he was already transferred to Jewelry Department, as Head.
Subsequently, James was handed a Notice of Termination informing him that he was found guilty of
breach of trust and confidence for knowingly and maliciously referring, endorsing and vouching for VISA card
applicants who later turned out to be impostors resulting in financial loss to Keppel. This prompted James to
file before the Labor Arbiter a complaint for illegal dismissal, illegal confiscation of car with prayer for the
payment of vacation/sick leaves, 13th month pay, damages, attorneys fees and full backwages against Keppel.
The Labor Arbiter found Keppel guilty of illegal dismissal. The NLRC affirmed the decision of the LA but the
Court of Appeals reversed its ruling.
ISSUE:
Whether James was illegally dismissed
RULING:
YES. The first requisite for dismissal on the ground of loss of trust and confidence is that the employee
concerned must be holding a position of trust and confidence. In this case, there is no doubt that James held a
position of trust and confidence as Assistant Vice-President of the Jewelry Department. The second requisite
is that there must be an act that would justify the loss of trust and confidence. Loss of trust and confidence, to
be a valid cause for dismissal, must be based on a willful breach of trust and founded on clearly established
facts. The basis for the dismissal must be clearly and convincingly established but proof beyond reasonable
doubt is not necessary. Keppel’s evidence against James fails to meet this standard.
From the findings of both the Labor Arbiter and the NLRC it is clear that James did nothing wrong
when he handed over to Marciana the envelope containing the applications of persons under the referred
accounts of Jorge who were later found to be fictitious. As the records now stand, James was no longer
connected with the VISA Credit Card Unit when the 67 applications for VISA card were approved. At such time,
he was already the Head of the Marketing and Operations of the Jewelry Department. His act therefore of
forwarding the already accomplished applications to the VISA Credit Card Unit is proper as he is not in any
position to act on them. The processing and verification of the identities of the applicants would have been
done by the proper department, which is the VISA Credit Card Unit. Therefore, it is incumbent upon Marciana
as Unit Head to have performed her duties. As correctly observed by the Labor Arbiter, Keppel had gone too
far in blaming James for the shortcomings and imprudence of Marciana. The invocation of Keppel of the loss
of trust and confidence as ground for Jamess termination has therefore no basis at all. Having shown that
Keppel failed to discharge its burden of proving that Jamess dismissal is for a just cause, we have no other
recourse but to declare that such dismissal based on the ground of loss of trust and confidence was illegal. This
is in consonance with the constitutional guarantee of security of tenure.
THE COCA-COLA EXPORT CORPORATION v. CLARITA P. GACAYAN

G.R. No. 149433, 22 June 2011, SPECIAL FIRST DIVISION (Leonardo-De Castro, J.)
It is well-settled in our jurisdiction that loss of trust and confidence constitutes a just and valid
cause for an employee’s termination.
One of the benefits enjoyed by the employees of The Coca-Cola Export Corporation (Coca-
Cola) was the reimbursement of meal and transportation expenses incurred while rendering
overtime work. This was allowed only when the employee worked overtime for at least four hours
on a Saturday, Sunday, or holiday, and for at least two hours on weekdays. The maximum amount
allowed to be reimbursed was one hundred fifty (P150.00) pesos. It was in connection with this
company policy that respondent Clarita Gacayan (Gacayan), then a Senior Financial Accountant, was
made to explain the alleged alterations in threenreceipts which she submitted to support her claim
for reimbursement of meal expenses.
Coca-Cola sent Gacayan several memoranda requiring her to explain why her claims for
reimbursement should not be considered fraudulent since there were alterations in the receipts she
submitted. Gacayan submitted her explanation denying any personal knowledge in the commission
of the alterations on the subject receipts. Coca-Cola then conducted a hearing and formal
investigation on the matter to give Gacayan an opportunity to explain the issues against her and to
present her side. After attending the first scheduled hearing and participating thereat, respondent
Gacayan did not attend the succeeding hearings, citing her doctors advice to rest, and likewise
complaining of the alleged partiality of the investigating committee against her.
Coca-Cola dismissed Gacayan for fraudulently submitting tampered and/or altered receipts
in support of her petty cash reimbursements in gross violation of the companys rules and regulations.
She then filed a complaint with the National Labor Relations Commission (NLRC). The Labor Arbiter
dismissed Gacayan’s complaint for lack of merit. This was affirmed by the NLRC. On appeal, the Court
of Appeals reversed the NLRC and ruled that the penalty imposed on respondent Gacayan was too
harsh. In Coca-Cola’s petition for review on certiorari, the Supreme Court declared that Gacayan’s
dismissal from employment was not grounded on any of the just causes enumerated under Article
282 of the Labor Code since Coca-Cola, in its termination letter neither mentioned its alleged loss of
trust and confidence in respondent Gacayan, nor discussed the alleged sensitive and delicate position
of Gacayan requiring the utmost trust of Coca-Cola. Coca-Cola then filed a Motion for Reconsideration
of the court’s decision arguing that Gacayan’s position as a Senior Financial Accountant with the Job
Description of a Financial Project Analyst has duties which clearly qualify her as one occupying a
position of trust and responsibility.
ISSUE:
Whether Gacayan was illegally dismissed.
RULING:
NO. It is well-settled in our jurisdiction that loss of trust and confidence constitutes a just and
valid cause for an employee’s termination. In the instant case, respondent Gacayan was the Senior
Financial Accountant of petitioner company. While respondent Gacayan denies that she is handling
or has custody of petitioners funds, a re-examination of the records of this case reveals that she
indeed handled delicate and confidential matters in the financial analyses and evaluations of the
action plans and strategies of petitioner company. Respondent Gacayan was also privy to the
strategic and operational decision-making of petitioner company, a sensitive and delicate position
requiring the latters utmost trust and confidence. As such, she should be considered as holding a
position of responsibility or of trust and confidence.
Respondent Gacayan betrayed the trust and confidence reposed on her when she, ironically
a Senior Financial Accountant tasked with ensuring financial reportorial/regulatory compliance from
others, repeatedly submitted tampered or altered receipts to support her claim for meal
reimbursements, in gross violation of the rules and regulations of petitioner company. Respondent
Gacayan intentionally, knowingly, purposely, and without justifiable excuse, submitted tampered or
altered receipts to support her claim for meal reimbursement. Respondent Gacayan failed to
sufficiently refute the charges against her for the submission of said fraudulent items of expense. All
she did was to deny any personal knowledge in the commission of the alterations in the subject
receipts and to point fingers at other people who may have done the alterations.
Infractions
JERRY MAPILI v. PHILIPPINE RABBIT BUS LINES, INC./NATIVIDAD NICSE

G.R. No. 172506, 27 July 2011, FIRST DIVISION (Del Castillo, J.)
Past infractions are still relevant and may be considered in assessing liability for present
infraction.
Jerry Mapili (Mapili) was hired by Philippine Rabit Bus Line, Inc. (PRBLI) as bus conductor.
He was caught by PRBLI’s field inspector extending a free ride to a lady passenger. Mapili was
preventively suspended and was directed to appear in an administrative investigation. A formal
hearing was conducted during which Mapili was afforded opportunity to explain his side.
Consequently, he was terminated for committing a serious irregularity in violation of company rules.
Notably, that was already the third time that Mapili committed said violation. Mapili alleged that the
infraction he committed was only trivial and was done without malice. He argued that it resulted from
his honest belief that immediate family members of PRBLI employees are entitled to free ride. He
further claimed that the two previous violations of the same company regulation cannot be
considered in imposition of penalty dismissal since the previous infractions were not too serious.
Labor Arbiter (LA) held that Mapili had no intention to defraud the company as the same was
done out of gratitude. National Labor Relations Commission (NLRC) set aside the findings of LA. NLRC
found that the non-issuance of ticket and failure to collect money due to the company was a deliberate
and intentional act of Mapili. It opined that Mapili’s past record of committing several acts of
misconduct and his propensity to commit similar infractions do not merit compassion of law. Court
of Appeals (CA) affirmed NLRC ruling.
ISSUE:
Whether or not the infraction committed justifies dismissal of Mapili from employment
RULING:
YES. Mapili’s violation of company rules was willful, serious and just cause for dismissal.
Mapili mentioned the Collective Bargaining Agreement which provides that PRBLI’s employees have
free ride and also their immediate family, provided they are given passes upon request to the
company. Clearly, free rides are only given to employees. The benefit is not automatically extended to
members of the employees’ immediate family as passes must first be requested. It is to be noted that
Mapili has been in the employ of PRBLI for more than 8 years and is member of company union. As
such, he ought to know the specific company rules pertaining to his line of work as a bus conductor.
Contrary to his argument, the infraction is not trivial. His position is imbued with trust and confidence
because it involves handling of money and failure to collect the proper fare from riding public
constitutes a grave offense which justifies his dismissal.
He committed similar infractions of extending free rides two times. These had been brought
to his attention and for which penalties were meted out upon him. Hence, he ought to have known
better than to repeat the same violation as he is presumed to be thoroughly acquainted with the
prohibitions and restrictions against extending free rides. Although Mapili already suffered the
corresponding penalties for his past misconduct, those infractions are still relevant and may be
considered in assessing his liability for his present infraction.
Misconduct
SAMAHAN NG MGA MANGGAGAWA SA HYATT (SAMASAH-NUWHRAIN) v. HON. VOLUNTARY

ARBITRATORBUENAVENTURA C. MAGSALIN and HOTEL ENTERPRISES OF THE PHILIPPINES, INC., /
SAMAHAN NG MGA MANGGAGAWA SA HYATT (SAMASAH-NUWHRAIN) v. HOTEL
ENTERPRISES OF THE PHILIPPINES, INC.
G.R. Nos. 164939/172303, 6 June 2011, THIRD DIVISION (Villarama, Jr., J.)
A series of irregularities when put together may constitute serious misconduct, which under
Article 282 of the Labor Code, as amended, is a just cause for dismissal. Severance compensation, or
whatever name it is called, on the ground of social justice shall be allowed only when the cause of the
dismissal is other than serious misconduct or for causes which reflect adversely on the employees moral
character.
Petitioner Samahan ng mga Manggagawa sa Hyatt-NUWHRAIN-APL (Labor Union) is a duly
registered union and the certified bargaining representative of the rank-and-file employees of Hyatt
Regency Manila (Hyatt), a five-star hotel owned and operated by respondent Hotel Enterprises of the
Philippines, Inc. Angelito Caragdag (Caragdag), the director of the union who is a waiter committed a
series of infractions that led to his dismissal. First, he was suspended for violating the hotel policy on
bag inspection and body frisking on two occasions. Second, he was suspended for threatening and
intimidating a superior while the latter was counseling his staff. Third, he was suspended for leaving
his work assignment without permission.
Because of the succession of infractions he committed, the HRD required him to explain why the
hotel’s OSDA 4.32 (Committing offenses which are penalized with three [3] suspensions during a 12-
month period) should not be enforced against him. An investigation board was formed after receipt of
Caragdags written explanation. However, despite notice of the scheduled hearing, both Caragdag and the
Union President failed to attend. Thereafter, the investigating board resolved on the said date to dismiss
Caragdag for violation of OSDA 4.32. The hotel sent Caragdag a Notice of Dismissal. Caragdag’s dismissal
was questioned by the labor union, and the dispute was referred to voluntary arbitration upon agreement
of the parties. The Voluntary Arbitrator found the three separate suspensions of Caragdag valid. It
however oredered Hyatt to grant Caragdag financial assistance in the amount of P100,000.00.
On appeal by the labor union to the Court of Appeals via petition for certiorari, it dismissed the
petition outright for being the wrong remedy. Hyatt also filed a petition for review with the CA on the
ground that the Voluntary Arbitrator committed a grievous error in awarding financial assistance to
Caragdag despite his finding that the dismissal due to serious misconduct was valid. The CA agreed with
the findings of the Voluntary Arbitrator that Caragdag was validly dismissed due to serious
misconduct. Accordingly, financial assistance should not have been awarded to Caragdag.
ISSUES:
1. Whether the CA erred in dismissing outright the petition for certiorari filed before it on the
ground that the same is an improper mode of appeal
2. Whether the CA erred in deleting the award of financial assistance in the amount of P100,000.00
to Caragdag.
RULING:
1. NO. In the case of Samahan ng mga Manggagawa sa Hyatt-NUWHRAIN-APL v. Bacungan, we

repeated the well-settled rule that a decision or award of a voluntary arbitrator is appealable to the
CA via petition for review under Rule 43. Hence, upon receipt on May 26, 2003 of the Voluntary
Arbitrators Resolution denying petitioners motion for reconsideration, petitioner should have filed
with the CA, within the fifteen (15)-day reglementary period, a petition for review, not a petition
for certiorari.
2. NO. The grant of separation pay or some other financial assistance to an employee
dismissed for just causes is based on equity. In Phil. Long Distance Telephone Co. v. NLRC, we ruled
that severance compensation, or whatever name it is called, on the ground of social justice shall be
allowed only when the cause of the dismissal is other than serious misconduct or for causes which
reflect adversely on the employees moral character.
Here, Caragdag’s dismissal was due to several instances of willful disobedience to the
reasonable rules and regulations prescribed by his employer. The Voluntary Arbitrator pointed out
that according to the hotels Code of Discipline, an employee who commits three different acts of
misconduct within a twelve (12)-month period commits serious misconduct. He stressed that
Caragdag’s infractions were not even spread in a period of twelve (12) months, but rather in a period
of a little over a month. Records show the various violations of the hotels rules and regulations were
committed by Caragdag. He was suspended for violating the hotel policy on bag inspection and body
frisking. He was likewise suspended for threatening and intimidating a superior while the latter was
counseling his staff. He was again suspended for leaving his work assignment without
permission. Evidently, Caragdag’s acts constitute serious misconduct. Caragdag’s dismissal being due
to serious misconduct, it follows that he should not be entitled to financial assistance. To rule
otherwise would be to reward him for the grave misconduct he committed.
NISSAN MOTORS PHILS. INC. v. VICTORINO ANGELO

G.R. No. 164181, 14 September 2011, THIRD DIVISION, (Peralta, J.)
Accusatory and inflammatory language used by an employee to the employer or superior can
be a ground for dismissal or termination.
Victorino Angelo (Angelo), employed as payroll staff of Nissan Motors Phils., Inc. (Nissan),
failed on two instances failed to prepare the payroll for Nissan’s employees. The first instance was
when Angelo was on sick leave and the second was when he was on an approved vacation leave.
Later, he received a Memorandum stating that Nissan is considering his dismissal due to serious
misconduct, willful disobedience and gross neglect of duties. According to Nissan, these absences and
failure of Angelo to process the payroll brought prejudice to its employees and consequently to its
manufacturing operations. Angelo was then placed under preventive suspension pending the
investigation conducted by Nissan. In his written explanation, Angelo put the blame to Nissan, to wit:
Again, it's not negligence on my part and I'm not alone to be blamed. It's negligence
on your part [Perla Go] and A.A. Del Rosario kasi, noong pang April 1999 ay alam
ninyo na hindi ako ang dapat may responsibilidad ng payroll kundi ang Section Head
eh bakit hindi ninyo pinahawak sa Section Head noon pa. Pati kaming dalawa sa
payroll, kasama ko si Thelma. Tinanggal nyo si Thelma. Hindi nyo ba naisip na
kailangan dalawa ang tao sa payroll para pag absent ang isa ay may gagawa. Dapat
noon nyo pa naisip iyan. Ang tagal kong gumawa ng trabahong hindi ko naman dapat
ginagawa.
Thereafter, Angelo filed a complaint for illegal suspension with the Department of Labor and
Employment (DOLE). In the meantime, Angelo was terminated after the hearing conducted by Nissan.
As such, Angelo amended his complaint to include a charge of illegal dismissal. The LA dismissed the
complaint for lack of merit which was later affirmed by the NLRC on appeal. Undaunted, Angelo filed
with the CA a petition for certiorari. The CA granted the petition and reversed the decision of the
NLRC and LA. CA ordered the reinstatement of Angelo.
ISSUE:
Whether or not Angelo was validly dismissed.

RULING:
YES. One of the just causes enumerated in the Labor Code is serious misconduct. Misconduct
is improper or wrong conduct. It is the transgression of some established and definite rule of action,
a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere
error in judgment. The Court finds that the content and tenor of Angelo’s Letter-Explanation were
grossly discourteous. The most appropriate thing he could have done was simply to state his facts
without resorting to such strong language. Past decisions of this Court have been one in ruling that
accusatory and inflammatory language used by an employee to the employer or superior can be a
ground for dismissal or termination.
Another just cause cited by Nisssa is willful disobedience. One of the fundamental duties of
an employee is to obey all reasonable rules, orders and instructions of the employer. Disobedience,
to be a just cause for termination, must be willful or intentional, willfulness being characterized by a
wrongful and perverse mental attitude rendering the employee’s act inconsistent with proper
subordination. This allegation of willful disobedience can still be adduced and proven from the same
Letter-Explanation cited earlier.
Nissan also dismissed respondent because of gross or habitual negligence. Neglect of duty, to
be a ground for dismissal, must be both gross and habitual. In finding that Nissan was able to adduce
evidence that would justify its dismissal of respondent, the NLRC correctly ruled that the latter's
failure to turn over his functions to someone capable of performing the vital tasks which he could not
effectively perform or undertake because of his heart ailment or condition constitutes gross neglect.
Habitual Neglect of Duties
PHILIPPINE NATIONAL BANK vs. DAN PADAO

GR No. 180849 and 187143, 16 November 2011, THIRD DIVISION, (Mendoza, J)
Gross negligence has been defined as the want or absence of or failure to exercise slight care or
diligence, or the entire absence of care.
On August 21, 1981, Padao was hired by PNB as a clerk. He was later designated as a credit
investigator and was ultimately promoted to the position of Loan and Credit Officer IV. Sometime in
1994, PNB became embroiled in a scandal involving behest loans. The expos triggered the conduct of
separate investigations by the COA and PNBs Internal Audit Department from January to August
1995. Both investigations confirmed that the collateral provided in numerous loan accommodations
were grossly over-appraised. The credit standing of the loan applicants was also fabricated, allowing
them to obtain larger loan portfolios from PNB. These borrowers eventually defaulted on the
payment of their loans, causing PNB to suffer millions in losses.
On June 14, 1996, Padao was administratively charged with Dishonesty, Grave Misconduct,
Gross Neglect of Duty, Conduct Prejudicial to the Best Interest of the Service, and violation of R.A. No.
3019. On January 10, 1997, after due investigation, PNB found Padao guilty of gross and habitual
neglect of duty and ordered him dismissed from the bank. Padao instituted a complaint against PNB
with the Labor Arbiter. The Labor Arbiter found Padao’s dismissal valid. Padao appealed to the NLRC,
which, in its Resolution reversed and set aside the LA Decision and declared Padao’s dismissal to be
illegal.
ISSUE:
Whether or not Padao was illegally dismissed.
RULING:
NO. Padao was dismissed by PNB for gross and habitual neglect of duties under Article 282
(b) of the Labor Code. Gross negligence has been defined as the want or absence of or failure to
exercise slight care or diligence, or the entire absence of care. It evinces a thoughtless disregard of
consequences without exerting any effort to avoid them.
In the case at bench, Padao was accused of having presented a fraudulently positive
evaluation of the business, credit standing/rating and financial capability. Padao’s repeated failure
to discharge his duties as a credit investigator of the bank amounted to gross and habitual neglect of
duties under Article 282 (b) of the Labor Code. He not only failed to perform what he was employed
to do, but also did so repetitively and habitually, causing millions of pesos in damage to PNB. Thus,
PNB acted within the bounds of the law by meting out the penalty of dismissal, which it deemed
appropriate given the circumstances.
ILLEGAL DISMISSAL
SUNRISE HOLIDAY CONCEPTS, INC., v. TERESA A. ARUGAY

While an employer enjoys a wide latitude of discretion in the promulgation of policies, rules, and
regulations on work-related activities of the employees, those directives, however, must always be fair
and reasonable, and the corresponding penalties, when prescribed, must always be commensurate to
the offense involved and to the degree of the infraction.
Teresa Arugay (Arugay) was engaged by Sunrise Holiday Concepts, Inc., (Sunrise Holiday)
was Collection Manager under a six (6)-month probationary period. As part of her functions, she
coordinated largely with her four (4) collectors and with clients, numbering more than two thousand
(2,000), from whom she was collecting existing accounts for Sunrise Holiday. In the exercise of her
functions, she made use of the company’s old mobile phone. Extensive coordination with company
employees and with clients compelled her to bring the cellular phone out of the company
premises. No one told her that she had to get permission from higher management to bring out the
said cellular phone but her job required her to be persistent with those whom she dealt with to collect
badly needed funds for the company. In the course of her functions, Arugay sent a memorandum
chiding her Assistant Collection Manager for the latter’s lack of dedication and her act of cheating on
her timecard. Unfortunately, the Assistant Collection Manager made an issue out of this and
complained to the Executive Assistant of Sunrise Holiday. The Executive Assistant favored the
Assistant Collection Manager, who is his goddaughter, and ignored Arugay’s report. Thereafter,
Arugay received a show-cause Memorandum for an act of Dishonesty for unauthorized bringing into
or taking out any article from company premises which is the company mobile phone and for
Tardiness.
Arugay submitted her written explanation intensely denying the charges imputed to her. She
requested for a formal confrontation with her accusers in order to address the issues against her. To
her surprise, the Executive Assistant of petitioner company denied her request for a confrontation,
while she was preventively suspended to make way for an administrative investigation.
Subsequently, she received a termination letter for alleged loss of trust and confidence, which
termination was immediately effective. Thus, Arugay filed a case for illegal dismissal, nonpayment of
13th month pay, payment of damages and attorneys fees against Sunrise Holiday. The Labor Arbiter
rendered a decision in favor of Arugay. On appeal, the NLRC affirmed in toto the decision of the LA.
The Court of Appeals initially reversed the decision of the NLRC but rendered an amended decision
reinstating the decision and the resolution of the NLRC with modification.
ISSUE:
Whether respondent was illegally dismissed from employment by petitioner company
RULING:
YES. In an illegal dismissal case, the onus probandi rests on the employer to prove that its
dismissal of an employee is for a valid cause. Petitioner dismissed respondent from employment
because of alleged loss of trust and confidence due to tardiness and for using the company issued
cellular phone outside the company premises and for her own personal use.
Loss of trust and confidence to be a valid ground for dismissal must be based on a willful
breach of trust and founded on clearly established facts. A breach is willful if it is done intentionally,
knowingly, and purposely, without justifiable excuse, as distinguished from an act done carelessly,
thoughtlessly, heedlessly, or inadvertently. Otherwise stated, it must rest on substantial grounds and
not on the employer's arbitrariness, whims, caprices, or suspicion; otherwise, the employee would
eternally remain at the mercy of the employer. It should be genuine and not simulated; nor should it
appear as a mere afterthought to justify an earlier action taken in bad faith or a subterfuge for causes
that are improper, illegal, or unjustified. It has never been intended to afford an occasion for abuse
because of its subjective nature. There must, therefore, be an actual breach of duty committed by the
employee that must be established by substantial evidence.
In this case, petitioner failed to prove that respondents dismissal was for a valid cause. The
penalty of dismissal is not commensurate to the infraction committed by the employee. On the alleged
tardiness committed by respondent, the same is not grave as to merit respondents dismissal from
service, considering that if it was true that respondent had been habitually tardy for several months,
petitioner would not have retained her services beyond the probationary period. Finally, a lesser
penalty should have been imposed by petitioner company to respondent considering that she has no
history of previous infractions.
ALERT SECURITY AND INVESTIGATION AGENCY, INC. et al v. SAIDALI PASAWILAN et al.

G.R. No. 182397, 14 September 2011, FIRST DIVISION, (Villarama, Jr., J.)
As a rule, employment cannot be terminated by an employer without any just or authorized

cause.
As a consequence of their filing of a complaint for money claims against their employer- Alert
Security and Investigation Agency, Inc. (Alert Security), Saidali Pasawilan, Wilfredo Verceles and
Melchor Bulusan (Pasawilan et al.) were relieved from their posts as security guards. Later they filed
a joint complaint for illegal dismissal against Alert Security and its president and general manager,
Manuel D. Dasig.
The Labor Arbiter ruled in favor of Pasawilan et al. and ruled that they have been illegally
dismissed. However on appeal, the NLRC reversed the decision of the Labor Arbiter holding that the
fact of dismissal or termination of employment was not sufficiently established. Pasawilan et al. then
elevated the case with the CA via petition for certiorari. The CA reversed the decision of the NLRC
thereby reinstating the decision of the LA. The CA ruled that Alert Security, as an employer, failed to
discharge its burden to show that the employee’s separation from employment was not motivated
by discrimination, made in bad faith, or effected as a form of punishment or demotion without
sufficient cause.
ISSUE:
Whether or not Pasawilan et al. were illegally dismissed.
RULING:
YES. As a rule, employment cannot be terminated by an employer without any just or

authorized cause. No less than the 1987 Constitution in Section 3, Article 13 guarantees security of
tenure for workers and because of this, an employee may only be terminated for just or
authorized causes that must comply with the due process requirements mandated by law. Hence,
employers are barred from arbitrarily removing their workers whenever and however they want.
The law sets the valid grounds for termination as well as the proper procedure to take when
terminating the services of an employee. Although we recognize the right of employers to shape their
own work force, this management prerogative must not curtail the basic right of employees to
security of tenure. There must be a valid and lawful reason for terminating the employment of a
worker. Otherwise, it is illegal and would be dealt with by the courts accordingly.
In the case at bar, Pasawilan et al. were relieved from their posts because they filed with the
Labor Arbiter a complaint against their employer for money claims due to underpayment of wages.
This reason is unacceptable and illegal. Nowhere in the law providing for the just and authorized
causes of termination of employment is there any direct or indirect reference to filing a legitimate
complaint for money claims against the employer as a valid ground for termination. The Labor Code,
as amended, enumerates several just and authorized causes for a valid termination of employment.
An employee asserting his right and asking for minimum wage is not among those causes. Dismissing
an employee on this ground amounts to retaliation by management for an employee’s legitimate
grievance without due process. Such stroke of retribution has no place in Philippine Labor Laws.
JOSE MEL BERNARTE v. PHILIPPINE BASKETBALL ASSOCIATION (PBA), JOSE EMMANUEL M.

EALA, and PERRY MARTINEZ
G.R. No. 192084, 14 September 2011, SECOND DIVISION, (Carpio, J.)
If PBA decides to discontinue Bernarte’s services at the end of the term fixed in the contract,
whether for unsatisfactory services, or violation of the terms and conditions of the contract, or for
whatever other reason, the same merely results in the non-renewal of the contract and does not
constitute illegal dismissal.
Jose Mel Bernarte and Renato Guevarra were invited by the Philippine Basketball Association
(PBA) to act as referees. They were made to sign contracts on a year-to-year basis Later, Bernarte
and Guevarra were informed that their services are no longer needed. Their contract was allegedly
not renewed due to unsatisfactory performance on and off the court. This prompted them to file a
complaint for illegal dismissal. For his part, PBA claimed that Bernarte and Guevarra are not its
employees hence it cannot terminate them and their contracts had expired.
The Labor Arbiter declared that Bernarte and Guevarra were illegally dismissed. As such, the
LA ordered their reinstatement. On appeal, the NLRC affirmed the decision of the LA. However, the
CA reversed the decision of the NLRC and LA holding that Bernarte and Guevarra are independent
contractors and that PBA has no control over the performance of work of Bernarte and Guevarra.
Only Bernarte appeal with the SC.
ISSUES:
1. Whether or not PBA exercised control over Bernarte so as to make it the employer of Bernarte.
2. Whether or not Bernarte was illegally dismissed
RULING:
1. NO. Once in the playing court, the referees exercise their own independent judgment, based
on the rules of the game, as to when and how a call or decision is to be made. The referees decide
whether an infraction was committed, and the PBA cannot overrule them once the decision is made
on the playing court. The referees are the only, absolute, and final authority on the playing court. PBA
or any of the PBA officers cannot and do not determine which calls to make or not to make and cannot
control the referee when he blows the whistle because such authority exclusively belongs to the
referees. The very nature of Bernabe’s job of officiating a professional basketball game undoubtedly
calls for freedom of control by PBA.
2. NO. In addition, the fact that PBA repeatedly hired Bernarte does not by itself prove that
Bernarte is an employee of the former. For a hired party to be considered an employee, the hiring
party must have control over the means and methods by which the hired party is to perform his work,
which is absent in this case. The continuous rehiring by PBA of petitioner simply signifies the renewal
of the contract between PBA and Bernarte, and highlights the satisfactory services rendered by
Bernarte warranting such contract renewal. Conversely, if PBA decides to discontinue petitioner’s
services at the end of the term fixed in the contract, whether for unsatisfactory services, or violation
of the terms and conditions of the contract, or for whatever other reason, the same merely results in
the non-renewal of the contract, as in the present case. The non-renewal of the contract between the
parties does not constitute illegal dismissal of Bernarte by PBA.
GRANDTEQ INDUSTRIAL STEEL PRODUCTS, INC., et al. v. ANNALIZA ESTRELLA

Burden rests upon the employer to show that the dismissal of an employee is for just cause, and
failure to do so would mean that the dismissal is not justified. Failure to discharge that burden would
mean that the dismissal is not justified, and therefore, illegal.
Grandteq Industrial Steel Products (Grandteq) and Annaliza Estrella (Estrella) entered into a
Purchase/Assignment of Car Agreement, whereby the former undertook to purchase car for Estrella,
who in turn refund the purchase price to Grandteq. The agreement likewise stated that the company
shall retain the ownership of the car until fully paid. When Estrella defaulted in her payments,
Grandteq instructed her to leave the car in the office premises. Estrella failed to abide by the directive;
hence, Grandteq sent another memorandum requiring her to explain her insubordination to which
she insisted Grandteq had no valid cause to demand its surrender. Estrella filed a complaint for
recovery of money claims. She filed an application for leave of absence, and subsequently, submitted
a medical certificate. Grandteq denied her application but she went on leave of absence. Estrella tried
to withdraw her salary but she discovered that her salary was not remitted by Grandteq; thus, she
amended her complaint to include illegal deduction and later on include illegal dismissal when she
was refused entry. For its defense, Grandteq averred that Estrella was validly dismissed because she
abandoned her job when she did not report for work, she committed insubordination when she failed
to obey its directive, and she violated trust and confidence reposed in her when she negotiated in her
personal capacity. Estrella was furnished with Notice of Termination indicating that she was
dismissed for gross and habitual neglect of duty and fraud or willful breach of trust.
Labor Arbiter ruled in favor of Estrella holding that abandonment could not be inferred from
her absences and the immediate filing of complaint also negated abandonment. National Labor
Relations Commission (NLRC) found that Grandteq had valid grounds to dismiss Estrella since
allegation of illegal termination was not substantiated by the guards preventing her from entry to
premises. The act of going on leave without approval constitutes gross and habitual neglect of duty,
but its failure to comply with due process made it liable for indemnity. Court of Appeals (CA)
reinstated LA’s decision.
ISSUES:
1. Whether or not acts imputed to Estrella constitute gross and habitual neglect of duty and loss
of trust and confidence.
2. Whether or not officers of Grandteq are solidary liable.
RULING:
1. NO. Grandteq attributes loss of trust and confidence to insubordination of Estrella and
entering transaction in personal capacity. Insubordination, as a just cause, necessitates the
concurrence of two requisites: a) employee’s assailed conduct must have been willful; and b) order
violated must have been reasonable, lawful, made known to employee, and must pertain to duties
which he had been engaged to discharge. In the present case, the second requisite is wanting. The
failure to return the car had no relation to the discharge of Estrella’s duties as sales engineer. There
was no finding of legitimate loss of confidence because Grandteq failed to show that Estralla held a
position of trust and confidence. Loss of confidence as just cause for terminating employee is
premised on the fact that the employee concerned holds a position of trust and confidence.
Grandteq also imputed gross and habitual neglect of duty whe Estrella absented herself for 3
weeks. Gross negligence connotes want of care in performance of one’s duties while habitual neglect
implies repeated failure to perform one’s duties in period of time. The single or isolated act of
negligence does not constitute just case for dismissal of employee. Also, it is settled that absences
does not amount to abandonment of employment. Abandonment has two elements: a) intention to
abandon and b) overt act from which it can be inferred that employee has no more intention to return
to work. Estrella’s actions after her absences negate intention to abandon job.
2. NO. A corporation, being a juridical entity, may act only through its directors and officers.
Obligations incurred by them acting as corporate agents are not theirs. However, solidary liability
may at times be incurred but only in exceptional circumstances such as when the directors or officers
vote or assent to patently unlawful acts and act in bad faith or with gross negligence in directing
corporate affairs. In the case at bar, there is no indication that Estrella’s dismissal was effected with
malice or bad faith on the part of Grandteq’s officers. Thus, their liability may not be solidary, but only
joint.
SANDEN AIRCON PHILIPPINES and ANTONIO ANG v. LORESSA ROSALES

G.R. No. 169260, 23 March 2011, FIRST DIVISION (Del Castillo, J.)
An employer has the discretion to dismiss an employee for loss of trust and confidence but the
former may not use the same to cloak an illegal dismissal.
Sanden Aircon Philippines (Sanden) employed Loressa Rosales (Rosales) as Management

Information System (MIS) Department Secretary. She was later on promoted as Data Custodian and
Coordinator. As such, Rosales had access to all computer programs and marketing computer data.
Sanden discovered that the marketing delivery receipt transactions computer files were missing. The
Internal Auditing Department sent a memorandum requesting that a technical investigation be
conducted. Thereafter, the Personnel and Administrative Services Manager sent a letter to Rosales
charging her with data sabotage and absences without leave. Rosales vehemently denied the
allegations of data sabotage. According to her, only a computer programmer equipped with expertise
and not a mere custodian would be capable of such an act. Sanden sent a letter indicating Rosales’
termination from employment due to loss of trust on her capability to continue as its Data Custodian.
Rosales filed a complaint for illegal dismissal. Labor Arbiter (LA) ruled that Sanded is guilty of illegal
dismissal since nowhere in the records can be found evidence, documentary, or otherwise that will
directly point out Rosales having committed sabotage. National Labor Relations Commission (NLRC)
affirmed LA decision. The Court of Appeals (CA) reversed NLRC ruling.
ISSUE:
Whether or not Sanden legally terminated Rosales on the ground of willful breach of trust and
confidence as Coordinator and Data Custodian
RULING:
NO. Article 282(c) of the Labor Code prescribes two separate and distinct grounds for
termination of employment, namely: a) fraud or b) willful breach by the employees of the trust
reposed in him by his employer. First requisite for the dismissal due to loss of trust and confidence is
that the employee concerned must be holding a position of trust and confidence. In this case, it is true
that as Coordinator and Data Custodian who has access to Sanden’s confidential papers and files,
Rosales held a position of trust and confidence. Second requisite is that it must be based on a willful
breach of trust and founded on clearly established facts. Sanden failed to meet this standard. Nowhere
in the records can be found evidence that directly point to Rosales as having committed acts of
sabotage. Rosales, on the other hand, was able to prove that Sanden’s computer system was
experiencing some problems even before the incident. Mere allegations and theories held by Sanden
as possible causes for the deletion of the subject files were not sufficient to discharge the burden of
proof that the dismissal is for just cause.
EXODUS INTERNATIONAL CONSTRUCTION CORPORATION AND ANTONIO P. JAVALERA v.
GUILLERMO BISCOCHO, et al.
G.R. No. 166109, 23 February 2011, FIRST DIVISION (Del Castillo, J.)
In illegal dismissal cases, it is incumbent upon the employees to first establish the fact of their dismissal
before the burden is shifted to the employer to prove that the dismissal was legal.
Guillermo Biscocho, Fernando Pereda, Ferdinand Mariano, Gregorio Bellita and Miguel
Bobillo were all employed by Exodus International Construction Corporation. On November 25, 2000,
Pereda, Bobillo and Mariano, were caught by the foreman, Wenifredo Lalap, still eating when they were
supposed to be working already. Lalap reprimanded them and they no longer reported for work. As to Bellita,
he absented himself from work to apply as a painter with another company. Since then he never reported back
to work. Lastly, in the case of Biscocho, he absented himself without leave on November 27, 2000, and so he
was reprimanded. Because of the reprimand, he did not report for work anymore. Biscocho, et al. then filed a
complaint against Exodus alleging that they were illegally dismissed.
The Labor Arbiter (LA) ruled in favor of Exodus on the ground that Biscocho, et al. chose not to
report for work; and that there is neither illegal dismissal nor abandonment of work, hence, Biscocho, et al.
should be reinstated but without backwages. The LA also ordered the payment of holiday pay, service
incentive leave pay (SIL) and 13th month pay. The National Labor Relations Commission (NLRC) and the Court
of Appeals (CA) affirmed the decision.
ISSUE/s:
1. Whether or not Exodus is guilty of illegally dismissing its employees.

2. Whether or not the acts of Biscocho, et al. constitute abandonment.
3. Whether or not the CA erred in ordering that Biscocho, et al. be reinstated to their former positions.
4. Whether or not Biscocho, et al. are entitled to their monetary claims
RULING:
1. NO. In cases of illegal dismissal, the employer bears the burden of proof to prove that the
termination was for a valid or authorized cause. But before Exodus must bear the burden of proving that the
dismissal was legal, Biscocho, et al. must first establish by substantial evidence that indeed they were
dismissed. If there is no dismissal, then there can be no question as to the legality or illegality thereof.
As found by the Labor Arbiter, there was no evidence that Biscocho, et al. were dismissed
nor were they prevented from returning to their work. It was only Biscocho, et al.’s unsubstantiated
conclusion that they were dismissed. Exodus was able to show that they never dismissed Biscocho, et
al. Hence, as between Biscocho, et al.’s general allegation of having been orally dismissed from the
service vis-a-vis those of Exodus which was found to be substantiated by the sworn statement of
foreman Wenifredo, we are persuaded by the latter.
2. NO. The LA is also correct in ruling that there was no abandonment on the part of Biscocho, et al.
that would justify their dismissal from their employment. It is a settled rule that mere absence or failure
to report for work is not enough to amount to abandonment of work. Abandonment is the deliberate
and unjustified refusal of an employee to resume his employment.
In Northwest Tourism Corporation v. Former Special 3rd Division of the Court of Appeals this Court held
that to constitute abandonment of work, two elements must concur, namely: (1) the employee must have
failed to report for work or must have been absent without valid or justifiable reason; and (2) there must have
been a clear intention on the part of the employee to sever the employer-employee relationship manifested
by some overt act.
It is the employer who has the burden of proof to show a deliberate and unjustified refusal of the
employee to resume his employment without any intention of returning. It is therefore incumbent upon
Exodus to ascertain Biscocho, et al.’s interest or non-interest in the continuance of their
employment. However, Exodus failed to do so.
3. NO. There was no dismissal, much less illegal, and there was also no abandonment of job to speak
of. The LA is therefore correct in ordering that Biscocho, et al. be reinstated but without any backwages.
There are two types of employees in the construction industry. The first is referred to as project
employees or those employed in connection with a particular construction project or phase thereof and such
employment is coterminous with each project or phase of the project to which they are assigned. The second
is known as non-project employees or those employed without reference to any particular construction
project or phase of a project.
The second category is where Biscocho, et al. are classified. As such they are regular employees of
Exodus. It is clear from the records of the case that when one project is completed, Biscocho, et al. were
automatically transferred to the next project awarded to Exoduss. There was no employment agreement given
to Biscocho, et al. which clearly spelled out the duration of their employment, the specific work to be
performed and that such is made clear to them at the time of hiring. Nonetheless, assuming that respondents
were initially hired as project employees, Exodus must be reminded of our ruling in Maraguinot, Jr. v. National
Labor Relations Commission that a project employee may acquire the status of a regular employee when the
following factors concur: 1.) There is a continuous rehiring of project employees even after cessation of a
project; and 2.) The tasks performed by the alleged project employee are vital, necessary and indispensable to
the usual business or trade of the employer.
In this case, the evidence on record shows that Biscocho, et al. were employed and assigned
continuously to the various projects of Exodus. As painters, they performed activities which were necessary
and desirable in the usual business of Exodus, who are engaged in subcontracting jobs for painting of
residential units, condominium and commercial buildings. As regular employees, Biscocho, et al. are entitled
to be reinstated without loss of seniority rights.
4. YES. Exodus as the employer of Biscocho, et al. and having complete control over the records
of the company could have easily rebutted the monetary claims against it. All that they had to do was
to present the vouchers or payrolls showing payment of the same. However, they decided not to
provide the said documentary evidence. Our conclusion therefore is that they never paid said
benefits and therefore they must be ordered to settle their obligation with Biscocho, et al.
ATLANTA INDUSTRIES, INC. and/or ROBERT CHAN v. APRILITO R. SEBOLINO, et al.

G.R. No. 187320, 26 January 2011, THIRD DIVISION (Brion, J.)
Employees who occupy positions or perform tasks that are usually necessary and desirable
in usual business or trade of the employer are considered as regular employees. Thus, when they were
dismissed without just or authorized cause, without notice, and without the opportunity to be heard,
their dismissal was illegal under the law
Aprilito R. Sebolino, Khim V. Costales, Alvin V. Almoite, and Joseph S. Sagun were among the
several employees who filed several complaints for illegal dismissal, regularization, underpayment,
nonpayment of wages and other money claims against the petitioners Atlanta Industries, Inc.
(Atlanta) and its President and Chief Operating Officer Robert Chan. The four employees alleged that
they had attained regular status as they were allowed to work with Atlanta for more than six (6)
months from the start of a purported apprenticeship agreement between them and the company.
They claimed that they were illegally dismissed when the apprenticeship agreement expired. In
defense, Atlanta and Chan argued that the workers were not entitled to regularization and to their
money claims because they were engaged as apprentices under a government-approved
apprenticeship program. The company offered to hire them as regular employees in the event
vacancies for regular positions occur in the section of the plant where they had trained. They also
claimed that their names did not appear in the list of employees (Master List) prior to their
engagement as apprentices.
Labor Arbiter Medroso found the termination of service of the employees to be illegal.
Atlanta appealed to the National Labor Relations Commission (NLRC). In the meantime, Costales,
Almoite and three others allegedly entered into a compromise agreement with Atlanta. The NLRC
rendered a decision, on appeal, modifying the ruling of the labor arbiter by withdrawing the illegal
dismissal finding with respect to Sagun, and three others; and approving the compromise agreement.
Sebolino, Costales, Almoite and Sagun moved for the reconsideration of the decision, but the NLRC
denied the motion. The four then sought relief from the CA through a petition for certiorari under
Rule 65 of the Rules of Court. The CA granted the petition. Atlanta and Chan moved for
reconsideration, but the CA denied the motion.
ISSUE:
Whether or not Costales, Almoite, Sebolino and Sagun are regular employees of Atlanta.
RULING:
YES. First. Based on company operations at the time material to the case, Costales, Almoite,
Sebolino and Sagun were already rendering service to the company as employees before they were
made to undergo apprenticeship. Second. The Master List (of employees) that the petitioners heavily
rely upon as proof of their position that the respondents were not Atlantas employees, at the time
they were engaged as apprentices, is unreliable and does not inspire belief. Third. The fact that
Costales, Almoite, Sebolino and Sagun were already rendering service to the company when they
were made to undergo apprenticeship (as established by the evidence) renders the apprenticeship
agreements irrelevant as far as the four are concerned. This reality is highlighted by the CA finding
that the respondents occupied positions such as machine operator, scaleman and extruder operator
- tasks that are usually necessary and desirable in Atlantas usual business or trade as manufacturer
of plastic building materials. These tasks and their nature characterized the four as regular
employees under Article 280 of the Labor Code. Thus, when they were dismissed without just or
authorized cause, without notice, and without the opportunity to be heard, their dismissal was illegal
under the law. Fourth. The compromise agreement allegedly entered into by Costales and Almoite,
together with Ramos, Villagomez and Alegria, purportedly in settlement of the case before the NLRC,
is not binding on Costales and Almoite because they did not sign it.
PRIMO E. CAONG, JR., et al. v. AVELINO REGUALOS

The employer can suspend employees who fail to meet the boundary limit and it is not
considered a dismissal as they can return to work upon payment of arrears.
Primo E. Caong, Jr., Alexander J. Tresquio, and Loriano D. Daluyon (Caong, et al.) were
employed by Avelino Regualos under a boundary agreement, as drivers of his jeepneys. They filed
separate complaints for illegal dismissal against Regualos who barred them from driving the vehicles
due to deficiencies in their boundary payments. During the mandatory conference, Regualos
manifested that Caong, et al. were not dismissed and that they could drive his jeepneys once they paid
their arrears. Caong, et al., however, refused to do so. They averred that they were illegally dismissed
by Regualos without just cause. Caong, et al. questioned Regualos’ policy of automatically dismissing
the drivers who fail to remit the full amount of the boundary as it allegedly (a) violates their right to
due process; (b) does not constitute a just cause for dismissal; (c) disregards the reality that there
are days when they could not raise the full amount of the boundary because of the scarcity of
passengers. The Labor Arbiter decided the case in favor of Regualos. Caong, et al. appealed the
decision to the National Labor Relations Commission (NLRC). The NLRC agreed with the Labor
Arbiter and dismissed the appeal. It also denied Caong, et al.’s motion for reconsideration. Forthwith,
Caong, et al.filed a petition for certiorari with the CA. The CA found no grave abuse of discretion on
the part of the NLRC. Dissatisfied, Caong, et al. filed a motion for reconsideration, but the CA denied
the motion.
ISSUE:
Whether Caong, et al. were illegally dismissed.
RULING:
NO. Indeed, petitioners’ suspension cannot be categorized as dismissal, considering that

there was no intent on the part of respondent to sever the employer-employee relationship between
him and petitioners. In fact, it was made clear that petitioners could put an end to the suspension if
they only pay their recent arrears. As it was, the suspension dragged on for years because of
petitioners stubborn refusal to pay. It would have been different if petitioners complied with the
condition and respondent still refused to readmit them to work. Then there would have been a clear
act of dismissal. But such was not the case. Instead of paying, petitioners even filed a complaint for
illegal dismissal against respondent. Respondent’s policy of suspending drivers who fail to remit the
full amount of the boundary was fair and reasonable under the circumstances. Respondent explained
that he noticed that his drivers were getting lax in remitting their boundary payments and, in fact,
herein petitioners had already incurred a considerable amount of arrears. He had to put a stop to it
as he also relied on these boundary payments to raise the full amount of his monthly amortizations
on the jeepneys. Demonstrating their obstinacy, petitioners, on the days immediately following the
implementation of the policy, incurred deficiencies in their boundary remittances.
It is acknowledged that an employer has free rein and enjoys a wide latitude of discretion to
regulate all aspects of employment, including the prerogative to instill discipline on his
employees and to impose penalties, including dismissal, if warranted, upon erring employees. This is
a management prerogative. Indeed, the manner in which management conducts its own affairs to
achieve its purpose is within the management’s discretion. The only limitation on the exercise of
management prerogative is that the policies, rules, and regulations on work-related activities of the
employees must always be fair and reasonable, and the corresponding penalties, when prescribed,
commensurate to the offense involved and to the degree of the infraction.
NELSON A. CULILI v. EASTERN TELECOMMUNICATIONS PHILIPPINES, INC. et al.

G.R. No. 165381, 9 February 2011, FIRST DIVISION (Leonardo-De Castro, J.)
The determination of whether or not an employee’s services are still needed or sustainable
properly belongs to the employer. Provided there is no violation of law or a showing that the employer
was prompted by an arbitrary or malicious act, the soundness or wisdom of this exercise of business
judgment is not subject to the discretionary review of the Labor Arbiter and the NLRC.
Nelson Culili was a Senior Technician in the Eastern Telecommunications Philippines, Inc.
(ETPI). ETPI experienced problems such as interconnection problems and cancellation of
subscriptions which forced it implement a Right-Sizing Program. This involved reducing its number
of employees and reorganizing the company. ETPI then offered the Special Retirement Program
which gave the employees an option to retire at an earlier age and in exchange, they would receive a
retirement package equivalent to 2 ½ months salary for every year of service. Among all those who
qualified for the program, only Culili refused to take the offer. He later on discovered that the
department where he was assigned to was abolished due to redundancy. Culili, thereafter, received
a letter from ETPI terminating his employment.
Aggrieved, Culili filed a complaint against ETPI alleging he was illegally dismissed and that
ETPI was guilty of unfair labor practices. The Labor Arbiter (LA) found ETPI guilty of illegal dismissal.
This was later on affirmed by the National Labor Relations Commission (NLRC). The Court of Appeals
(CA), however, ruled that ETPI’s act in abolishing the position of Culili was valid; that mere
contracting-out of services by ETPI is not tantamount to unfair labor practice; and that the officers of
ETPI cannot be held liable. But the CA did find ETPI guilty of violating Culili’s right to due process.
ISSUES:
1. Whether or not Culili was illegally dismissed.

2. Whether or not ETPI is guilty of unfair labor practices.
3. Whether or not ETPI’s dismissal of Culili violated his right to due process.
4. Whether or not ETPI’s officers are liable to Culili, and if so, whether Culili is entitled to moral
and exemplary damages.
RULING:
1. NO. There is redundancy when the service capability of the workforce is greater than what
is reasonably required to meet the demands of the business enterprise. A position becomes
redundant when it is rendered superfluous by any number of factors such as over-hiring of workers,
decrease in volume of business, or dropping a particular product line or service activity previously
manufactured or undertaken by the enterprise.
The determination of whether or not an employee’s services are still needed or sustainable
properly belongs to the employer. Provided there is no violation of law or a showing that the
employer was prompted by an arbitrary or malicious act, the soundness or wisdom of this exercise
of business judgment is not subject to the discretionary review of the Labor Arbiter and the NLRC.
However, an employer cannot simply declare that it has become overmanned and dismiss its
employees without producing adequate proof to sustain its claim of redundancy. Among the
requisites of a valid redundancy program are: (1) the good faith of the employer in abolishing the
redundant position; and (2) fair and reasonable criteria in ascertaining what positions are to be
declared redundant, such as but not limited to: preferred status, efficiency, and seniority.
In the case at bar, ETPI was upfront with its employees about its plan to implement a Right-
Sizing Program. Even in the face of initial opposition from and rejection of the said program by ETEU,
ETPI patiently negotiated with Eastern Telecommunications Employees Union (ETEU) officers to
make them understand ETPIs business dilemma and its need to reduce its workforce and streamline
its organization. This evidently rules out bad faith on the part of ETPI. ETPI chose on the basis of
efficiency, economy, versatility and flexibility. It needed to reduce its workforce to a sustainable level
while maintaining functions necessary to keep it operating. The records show that ETPI had
sufficiently established not only its need to reduce its workforce and streamline its organization, but
also the existence of redundancy in the position of a Senior Technician.
It is inconceivable that ETPI would effect a company-wide reorganization of this scale for the
mere purpose of singling out Culili and terminating him. If Culilis position were indeed indispensable
to ETPI, then it would be absurd for ETPI, which was then trying to save its operations, to abolish
that one position which it needed the most. What ETPI did was to abolish the position itself for being
too specialized and limited. The functions of that position were then added to another employee
whose functions were broad enough to absorb the tasks of a Senior Technician.
2. NO. Unfair labor practice refers to acts that violate the workers' right to organize. Thus, an
employer may only be held liable for unfair labor practice if it can be shown that his acts affect in
whatever manner the right of his employees to self-organize.
There is no showing that ETPI, in implementing its Right-Sizing Program, was motivated by
ill will, bad faith or malice, or that it was aimed at interfering with its employees right to self-
organize. In fact, ETPI negotiated and consulted with ETEU before implementing its Right-Sizing
Program.
3. YES. There are two aspects which characterize the concept of due process under the Labor
Code: one is substantive whether the termination of employment was based on the provision of the
Labor Code or in accordance with the prevailing jurisprudence; the other is procedural the manner
in which the dismissal was effected.
ETPI does not deny its failure to provide DOLE with a written notice regarding Culilis
termination. It, however, insists that it has complied with the requirement to serve a written notice
to Culili as evidenced by his admission of having received it and forwarding it to his union president.
ETPI, in effecting Culilis termination, simply asked one of its guards to serve the required
written notice on Culili. Culili, on one hand, claims in his petition that this was handed to him by ETPIs
vice president, but previously testified before the Labor Arbiter that this was left on his
table. Regardless of how this notice was served on Culili, ETPI failed to properly notify Culili about
his termination. Aside from the manner the written notice was served, a reading of that notice shows
that ETPI failed to properly inform Culili of the grounds for his termination. Hence, since it has been
established that Culilis termination was due to an authorized cause and cannot be considered unfair
labor practice on the part of ETPI, his dismissal is valid. However, in view of ETPIs failure to comply
with the notice requirements under the Labor Code, Culili is entitled to nominal damages in addition
to his separation pay.
4. NO. It is our considered view that Culili has failed to prove that his dismissal was
orchestrated by the individual respondents herein for the mere purpose of getting rid of him. In fact,
most of them have not even dealt with Culili personally. Moreover, it has been established that his
termination was for an authorized cause, and that there was no bad faith on the part of ETPI in
implementing its Right-Sizing Program, which involved abolishing certain positions and departments
for redundancy. It is not enough that ETPI failed to comply with the due process requirements to
warrant an award of damages, there being no showing that the company’s and its officers acts were
attended with bad faith or were done oppressively.
CONSTRUCTIVE DISMISSAL
EMIRATE SECURITY AND MAINTENANCE SYSTEMS, INC. and ROBERTO A. YAN v. GLENDA A.
MENESE
G.R. No. 182848, 5 October 2011, SECOND DIVISION (Sereno, J.)
For a transfer not to be considered a constructive dismissal, the employer must be able to show
that the transfer is for a valid reason, entails no diminution in the terms and conditions of employment,
and must be unreasonably inconvenient or prejudicial to the employee.
Menese was payroll and billing clerk in Emirate Security and Maintenance Systems, Inc.
(agency). She was assigned to the agency’s security detachment at the Philippine General Hospital
(PGH). On May 4, 2001, Menese was pressured to resign from her position because it had been
committed to one Amy Claro. Menese raised the matter with the agency’s General Manager, Roberto
Yan, who told her that the agency was in the process of establishing goodwill with Violeta Dapula, the
new chief of the University of the Philippines Security Division, so Menese had to sacrifice her
position to accommodate Dapula’s request to hire another.
Menese claimed that she was offered to be retained as a lady guard with a salary equivalent
to the minimum wage. She would then be detailed to another detachment because Dapula did not
like to see her around anymore. Menese declined because she realized that she was actually being
demoted in rank and salary. She continued reporting to the PGH detachment and performed her usual
functions as if nothing happened. Menese alleged that at this juncture, Claro reported at the agency’s
PGH detachment and performed the functions she was doing. She bewailed that thereafter she
continuously received harassment calls and letters. She was also publicly humiliated and badly
treated at the detachment. The agency allegedly withheld her salary. She claimed that she was
dismissed her from the service without just cause and due process. Menese then filed a complaint for
constructive dismissal.
The Labor Arbiter (LA) declared that Menese was constructively dismissed. The National
Labor Relations Commission (NLRC) reversed the decision, saying that Menese was merely
transferred to another detachment. The Court of Appeals (CA) also agreed there was constructive
dismissal.
ISSUE:
Whether or not Menese was constructively dismissed.
RULING:
YES. In Blue Dairy Corporation v. NLRC, the Court stressed as a matter of principle that the
managerial prerogative to transfer personnel must be exercised without abuse of discretion, bearing
in mind the basic elements of justice and fair play. Having the right should not be confused with the
manner in which that right is exercised. Thus, it should not be used as a subterfuge by the employer
to get rid of an undesirable worker. Measured against this basic precept, the agency undoubtedly
abused their discretion or authority in transferring Menese to the agency’s head office. She had
become undesirable because she stood in the way of Claro’s entry into the PGH detachment. Menese
had to go, thus the need for a pretext to get rid of her. The request of a client for the transfer became
the overriding command that prevailed over the lack of basis for the transfer.
The Court cannot blame Menese for refusing Yan’s offer to be transferred. Not only was the
transfer arbitrary and done in bad faith, it would also result, as Menese feared, in a demotion in rank
and a diminution in pay. Although Yan informed Menese that based on the request of the client, she
will be transferred to another assignment, which however will not involve any demotion in rank nor
diminution in her salaries and other benefits, the offer was such as to invite reluctance and suspicion
as it was couched in a very general manner. We find credible Menese’s submission on this
point, i.e., that under the offered transfer: (1) she would hold the position of lady guard and (2) she
would be paid in accordance with the statutory minimum wage, or from P11,720.00 to P7,500.00.
In these lights, Menese’s transfer constituted a constructive dismissal as it had no justifiable

basis and entailed a demotion in rank and a diminution in pay for her. For a transfer not to be
considered a constructive dismissal, the employer must be able to show that the transfer is for a valid
reason, entails no diminution in the terms and conditions of employment, and must be unreasonably
inconvenient or prejudicial to the employee. If the employer fails to meet these standards, the
employee’s transfer shall amount, at the very least, to constructive dismissal. The agency,
unfortunately for them, failed to come up to these standards.
NATIONWIDE SECURITY AND ALLIED SERVICES, INC. v. RONALD P. VALDERAMA

G.R. No. 186614, 23 FEBRUARY 2011, SECOND DIVISION, (NACHURA, J.)
Temporary off-detail or the period of time security guards are made to wait until they are
transferred or assigned to a new post or client does not constitute constructive dismissal, so long as
such status does not continue beyond six months.
Ronald Valderama was hired by Nationwide Security and Allied Service Inc. as security guard
on April 18, 2002. He was assigned at the Philippine Heart Center, Quezon City, until his relief on
January 30, 2006. Valderama was not given any assignment thereafter. Thus, on August 2, 2006, he
filed a complaint for constructive dismissal against Nationwide. Nationwide claims that Valderama
was not constructively or illegally dismissed for it alleged that Valderama has committed serious
violations of the security rules in the workplace. It averred that it required Valderama through a letter
to report for reassignment but accordingly had voluntarily resigned. However, no evidence of a
resignation letter was ever presented to support the allegation of resignation.
ISSUE:
Whether or not Ronald Valderama was constructively dismissed.
RULING:
YES. It would have been illogical for Valderama to resign and then file a complaint for illegal
dismissal. Resignation is inconsistent with the filing of the said complaint. Nationwide was firm in
asserting that Valderama voluntarily resigned. Oddly, it failed to present the alleged resignation
letter of Valderama. We also note that, in its letter, Nationwide required Valderama to report at its
office for reassignment. It strains credulity that Nationwide would require Valderama to report for
reassignment if the latter already tendered his resignation. When a security guard is placed on a
"floating status," he does not receive any salary or financial benefit provided by law. Due to the grim
economic consequences to the employee, the employer should bear the burden of proving that there
are no posts available to which the employee temporarily out of work can be assigned.
Besides, the fact that Valderama filed the instant complaint negates any intention on his part
to forsake his work. It is a settled doctrine that the filing of a complaint for illegal dismissal is
inconsistent with the charge of abandonment, for an employee who takes steps to protest his
dismissal cannot by logic be said to have abandoned his work. Jurisprudence is trite with
pronouncements that the temporary inactivity or floating status of security guards should continue
only for six months. Otherwise, the security agency concerned could be liable for constructive
dismissal. The failure of Nationwide to give Valderama a work assignment beyond the reasonable
six-month period makes it liable for constructive dismissal. If there is a surplus of security guards
caused by lack of clients or projects, the security agency may resort to retrenchment upon
compliance with the requirements set forth in the Labor Code. In this way, the security agency will
not to be held liable for constructive dismissal and be burdened with the payment of back wages.
WILLIAM ENDELISEO BARROGA V. DATA CENTER COLLEGE OF THE PHILIPPINES and

WILFRED BACTAD
G.R. No. 174158, 27 June 2011, FIRST DIVISION (Del Castillo, J.)
Our labor laws are enacted not solely for the purpose of protecting the working class but also the
management by equally recognizing its right to conduct its own legitimate business affairs. It is management
prerogative for employers to transfer employees on just and valid grounds such as genuine business necessity.
William Endeliseo Barroga (Barroga) was employed as an Instructor

in Data Center College Laoag City branch in Ilocos Norte. In a Memorandum, respondent Data Center College
of the Philippines (Data Center) transferred him to University of Northern Philippines (UNP) in Vigan, Ilocos
Sur where the school had a tie-up program. Barroga was informed through a letter that he would be receiving,
in addition to his monthly salary, a P1,200.00 allowance for board and lodging during his stint as instructor in
UNP-Vigan. In 1994, he was recalled to Laoag campus. In 2003, Barroga received a Memorandum transferring
him to Data Center College Bangued, Abra branch as Head for Education/Instructor due to an urgent need for
an experienced officer and computer instructor thereat. However, Barroga declined to accept his transfer to
Abra citing the deteriorating health condition of his father and the absence of additional remuneration to
defray expenses for board and lodging which constitutes implicit diminution of his salary.
Barroga filed a complaint for constructive dismissal against Data Center. For their part, Data Center
claimed that they were merely exercising their management prerogative to transfer employees for the
purpose of advancing the school’s interests. They argued that Barroga’s refusal to be transferred to Abra
constitutes insubordination. The Labor Arbiter rendered a Decision dismissing the complaint for lack of
merit. The NLRC affirmed the findings of the Labor Arbiter that there was no constructive dismissal. It ruled
that the management decision to transfer Barroga was well within the rights of Data Center in consonance
with Barroga’s contract of employment and which was not sufficiently shown to have been exercised
arbitrarily by Data Center. The NLRC, however, found Barroga to be entitled to overload honorarium
pursuant to CHED Memorandum Order No. 25 for having assumed the position of Head for Education, albeit
on a temporary basis. Barroga filed a petition for certiorari before the Court of Appeals which the CA
dismissed for non-compliance with procedural rules.
ISSUES:
1. Whether the CA committed grave abuse of discretion in not giving due course to Barroga’s petition
despite substantial compliance with the requisite formalities.
2. Whether Barroga was constructively dismissed.
RULING:
1. YES. Indeed, petitioners petition before the CA stated only the date of his receipt of the NLRCs
Resolution denying his motion for partial reconsideration. It failed to state when petitioner received the
assailed NLRC Decision and when he filed his partial motion for reconsideration. However, this omission is
not at all fatal because these material dates are reflected in petitioners Partial Motion for Reconsideration
attached as Annex N of the petition.
Next, the CA dismissed the petition for failure to attach an affidavit of service. However, records show
that petitioner timely rectified this omission by submitting the required affidavit of service even before the CA
dismissed his petition. Thirdly, petitioners failure to attach respondents motion for reconsideration to the
assailed NLRC decision is not sufficient ground for the CA to outrightly dismiss his petition. The issue that was
raised in respondents motion for reconsideration is the propriety of the NLRCs grant of overload honorarium
in favor of petitioner. This particular issue was not at all raised in petitioners petition for certiorari with the CA,
therefore, there is no need for petitioner to append a copy of this motion to his petition. The Court has time
and again upheld the theory that the rules of procedure are designed to secure and not to override
substantial justice. These are mere tools to expedite the decision or resolution of cases, hence, their strict
and rigid application which would result in technicalities that tend to frustrate rather than promote
substantial justice must be avoided. The CA thus should not have outrightly dismissed petitioners petition
based on these procedural lapses.
2. NO. Constructive dismissal is quitting because continued employment is rendered impossible,

unreasonable or unlikely, or because of a demotion in rank or a diminution of pay. It exists when there is a
clear act of discrimination, insensibility or disdain by an employer which becomes unbearable for the
employee to continue his employment.
Petitioner was originally appointed as instructor in 1991 and was given additional administrative
functions as Head for Education during his stint in Laoag branch. He did not deny having been designated
as Head for Education in a temporary capacity for which he cannot invoke any tenurial security. Hence,
being temporary in character, such designation is terminable at the pleasure of respondents who made such
appointment. Moreover, respondent’s right to transfer petitioner rests not only on contractual stipulation
but also on jurisprudential authorities. The Labor Arbiter and the NLRC both relied on the condition laid
down in petitioner’s employment contract that respondents have the prerogative to assign petitioner in any
of its branches or tie-up schools as the necessity demands. In any event, it is management prerogative for
employers to transfer employees on just and valid grounds such as genuine business necessity.
The Court agrees with the Labor Arbiter that there was no violation of the prohibition on diminution
of benefits. Indeed, any benefit and perks being enjoyed by employees cannot be reduced and discontinued,
otherwise, the constitutional mandate to afford full protection to labor shall be offended. But the rule against
diminution of benefits is applicable only if the grant or benefit is founded on an express policy or has ripened
into a practice over a long period which is consistent and deliberate.
NIA JEWELRY MANUFACTURING OF METAL ARTS, INC. (otherwise known as NIA

MANUFACTURING AND METAL ARTS, INC.) and ELISEA B. ABELLA v. MADELINE C.
MONTECILLO and LIZA M. TRINIDAD
G.R. No. 188169, 28 November 2011, SECOND DIVISION (Reyes, J.)
Constructive dismissal occurs when there is cessation of work because continued employment is
rendered impossible, unreasonable or unlikely; when there is a demotion in rank or diminution in pay
or both; or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to
the employee.
Madeline Montecillo (Madeline) and Liza Trinidad (Liza) were first employed as goldsmiths
by the petitioner Nia Jewelry Manufacturing of Metal Arts, Inc. (Nia Jewelry) in 1996 and 1994,
respectively. Madeline's weekly rate was P1,500.00 while Liza's was P2,500.00. Petitioner Elisea
Abella (Elisea) is Nia Jewelry's president and general manager. There were incidents of theft
involving goldsmiths in Nia Jewelry's employ. Nia Jewelry imposed a policy for goldsmiths requiring
them to post cash bonds or deposits in varying amounts but in no case exceeding 15% of the latter's
salaries per week.
Madline and Liza claimed otherwise insisting that Nia Jewelry left the goldsmiths with no
option but to post the deposits. They alleged that they were constructively dismissed by Nia Jewelry
as their continued employments were made dependent on their readiness to post the required
deposits. Nia Jewelry on the other hand averred that Madline and Liza no longer reported for work
and signified their defiance against the new policy which at that point had not even been
implemented yet. Madeline and Liza filed complaints for illegal dismissal against Nia Jewelry. The
Labor Arbiter dismissed the complaints for lack of merit but ordered Nia Jewelry to pay Madeline the
sum of P3,750.00, and Liza, P6,250.00, representing their proportionate entitlements to 13th month
pay for the year 2004. The NLRC affirmed the LA’s dismissal of the amended complaints but deleted
the award of 13th month pay based on findings that the former had contracted unpaid individual
loans from Nia Jewelry. On appeal to the CA, it reversed the findings of the LA and the NLRC.
ISSUE:
Whether there was constructive dismissal.
RULING:
NO. Constructive dismissal occurs when there is cessation of work because continued
employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank
or diminution in pay or both; or when a clear discrimination, insensibility, or disdain by an employer
becomes unbearable to the employee.
In the case now under our consideration, the petitioners did not whimsically or arbitrarily
impose the policy to post cash bonds or make deductions from the workers' salaries. As attested to
by the respondents' fellow goldsmiths in their Joint Affidavit, the workers were convened and
informed of the reason behind the implementation of the new policy. Instead of airing their concerns,
the respondents just promptly stopped reporting for work.
Although the propriety of requiring cash bonds seems doubtful for reasons to be discussed
hereunder, we find no grounds to hold that the respondents were dismissed expressly or even
constructively by the petitioners. It was the respondents who merely stopped reporting for work.
While it is conceded that the new policy will impose an additional burden on the part of the
respondents, it was not intended to result in their demotion. Neither is a diminution in pay intended
because as long as the workers observe due diligence in the performance of their tasks, no loss or
damage shall result from their handling of the gold entrusted to them, hence, all the amounts due to
the goldsmiths shall still be paid in full. Further, the imposition of the new policy cannot be viewed
as an act tantamount to discrimination, insensibility or disdain against the respondents. For one, the
policy was intended to be implemented upon all the goldsmiths in Nia Jewelry's employ and not solely
upon the respondents. Besides, as stressed by the petitioners, the new policy was intended to merely
curb the incidences of gold theft in the work place. The new policy can hardly be said to be disdainful
or insensible to the workers as to render their continued employment unreasonable, unlikely or
impossible.
UNITED LABORATORIES, INC. v. JAIME DOMINGO substituted by his spouse CARMENCITA

PUNZALAN DOMINGO et al.
G.R. No. 186209, 21 September 2011, SECOND DIVISION, (PEREZ, J.)
The entitlement of workers to security of tenure is correlative to the right of enterprises to

reasonable returns on investments.
Jaime Domingo, Anonuevo Remigio, Rodolfo Marcelo, Raul Norico and Eugenio Ozaraga
(Domingo et al.) were former employees of United Laboratories Inc. (Unilab), a prominent domestic
corporation engaged in the manufacture, sale, marketing and distribution of pharmaceutical
products. Later, Unilab, under the Physical Distribution Master Plan (PDMP), consolidated its
warehousing and distribution of the finished goods of the sixteen (16) provincial centers into one
distribution center in Metro Manila. Also, under the Shared Services Policy (SSP), Unilab centralized
all its accounting services into one pool at its main office. The PDMP resulted in the closure of sixteen
(16) provincial depots while the SSP consolidated all the accounting services in the UNILAB group of
companies, affiliates and subsidiaries. As a result thereof, the job functions of the employees working
thereat were declared redundant and their positions were abolished. Unilab gave the redundant
employees a separation package of two and a half (2½) months’ pay for every year of service.
Later, Domingo et al. requested for the separation or retirement from service under a
separation package similar or equivalent to that of the redundant employees in the provincial depot
claiming that they should likewise be retired under the same redundancy plan or retirement scheme
because their positions are similarly situated. In response, Unilab denied their claim. Hence, Domingo
et al. filed three complaints for constructive dismissal, nonpayment/underpayment of separation
pay, damages and attorney’s fees against Unilab. The Labor Arbiter dismissed the consolidated
complaint for lack of merit. This dismissal was affirmed by the NLRC on appeal. Undaunted, Domingo
et al. elevated the case before the CA which reversed the decision of the NLRC ruling that Domingo et
al were constructively dismissed.
ISSUE:
Whether or not Domingo et al. were constructively dismissed

RULING:
NO. The concept of constructive dismissal is inapplicable to respondents. Constructive

dismissal is a derivative of dismissal without cause; an involuntary resignation, nay, a dismissal in
disguise. It occurs when there is cessation of work because continued employment is rendered
impossible, unreasonable, or unlikely as when there is a demotion in rank or diminution in pay or
when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the
employee leaving the latter with no other option but to quit.
It should be remembered, however, that the entitlement of workers to security of tenure is

correlative to the right of enterprises to reasonable returns on investments. Simply put, security of
tenure from which springs the concept of constructive dismissal is not an absolute right. It cannot be
pleaded to avoid the transfer or assignment of employees according to the requirements of the
employer’s business. Such transfer or assignment becomes objectionable only when it is not for
"reasonable returns on investments," and for "expansion and growth" which are constitutionally
recognized employer’s rights, but is sought merely as a convenient cover for oppression. No such
thing transpired in the instant case.
MARIO B. DIMAGAN v. DACWORKS UNITED, INCORPORATED AND/OR DEAN A. CANCINO

G.R. No. 191053, 28 November 2011, THIRD DIVISION (Perlas-Bernabe, J.)
The burden falls upon the company to prove that the employee's assignment from one position
to another is not tantamount to constructive dismissal.
Mario B. Dimagan (Dimagan) is a stockholder of Dacworks United, Inc., (Dacworks). In 1997,

he started working for respondent company as Officer-in-Charge (OIC) for mechanical installation.
Sometime in 2002, Dimagan was downgraded from his post as OIC to supervisor. Then, in March of
the following year, he was made to work as a mere technician. When he vocally expressed his
concerns regarding his assignments, one Loida Aquino, who was in charge of servicing/personnel
under the direct supervision of respondent Dean A. Cancino (Cancino), told him not to report for
work anymore. Thereafter, a certain Carlito Diaz, Operations Manager of Dacworks, castigated
Dimagan for not following Aquino's instruction to work as a technician. This prompted Dimagan to
file a complaint for illegal dismissal, non-payment of overtime pay, holiday pay, service incentive
leave and separation pay against Dacworks and Cancino.
Dacworks and Cancino denied that Dimagan was illegally dismissed arguing that, since April
4, 2003 up to the time of the filing of the complaint, Dimagan never reported for work and
continuously violated the company policy on absence without official leave (AWOL). They allegedly
sent a total of four (4) memoranda informing Dimagan of his offenses, including being AWOL, but he
nonetheless unjustifiably refused to return to work. In reply, Dimagan denied ever receiving any one
of the four memoranda allegedly sent by respondents. The Labor Arbiter decided in favor of Dimagan
holding that he was illegally dismissed. On appeal, the NLRC affirmed the Labor Arbiter's
Decision in toto. The CA reversed and set aside the Resolutions of the NLRC.
ISSUE:
Whether or not there was constructive dismissal.

RULING:
YES. Constructive dismissal is defined as a quitting because continued employment is

rendered impossible, unreasonable or unlikely; when there is a demotion in rank or a diminution of
pay. The test of constructive dismissal is whether a reasonable person in the employee's position
would have felt compelled to give up his position under the circumstances. It is an act amounting to
dismissal but is made to appear as if it were not. Constructive dismissal is therefore a dismissal in
disguise. The law recognizes and resolves this situation in favor of employees in order to protect their
rights and interests from the coercive acts of the employer.
As held in the case of Coca-Cola Bottlers Philippines, Inc. vs. Del Villar, the burden falls upon
the company to prove that the employee's assignment from one position to another was not
tantamount to constructive dismissal. In the case at bar, respondents failed to discharge said burden.
In fact, respondents never even disputed that petitioner was relegated from the position of OIC to
supervisor and, subsequently, to an ordinary technician. Clearly, the reduction in petitioner's
responsibilities and duties, particularly from supervisor to ordinary technician, constituted
a demotion in rank tantamount to constructive dismissal.
In this case, petitioner's failure to report for work was caused by the unwarranted demotion
in rank that was imposed upon him by respondents, not by any intention to sever employment ties
with them. And his filing of the instant complaint for illegal dismissal indubitably negates the
allegation of abandonment. Had petitioner intended to forsake his job, then he would not have found
it necessary to institute this case against respondents.
JHORIZALDY UY v. CENTRO CERAMICA CORPORATION and/or RAMONITA Y. SY and

MILAGROS U. GARCIA
G.R. No. 174631, 19 October 2011, FIRST DIVISION (Villarama, Jr., J.)
It is the lack of clear, valid and legal cause, not to mention due process that made the employee’s
dismissal illegal. The filing of a complaint for illegal dismissal just three weeks later is difficult to
reconcile with voluntary resignation.
Jhorizaldy Uy, a full-time sales executive in Centro Ceramica Corporation (CCC) since 1999,
alleged that his predicament began when former Vice President Milagros Garcia was rehired in the
last quarter of 2001. Certain incidents involving longtime clients led to a strained working
relationship between him and Garcia. In 2002, Uy’s superior informed him that he was to assume a
new position in the marketing department, to which the latter replied that he will think it over. That
same day, he was summoned by Garcia and President Ramonita Sy for a closed-door meeting where
Uy was informed of the termination of his services due to insubordination. A few days later, Sy
summoned Uy again but the latter instead asked for his termination paper. Sy told him that “If that’s
what you want I will give it to you.”
Before leaving the company, Uy turned over company samples, accounts and receivables to
his superior. But in March 2002, an employee of CCC presented to him at his apartment a
memorandum stating that he failed to meet the quota for sales executives from 1999 to 2001 in
violation of his contract of employment, and that Uy should explain in writing why his services should
not be terminated. He did not receive said memo because it was not written on the company
stationery and besides he had already been dismissed. He added that the allegation that he did not
meet the quota could not be true because he ranked second top performer in the company.
Uy then filed a complaint for illegal dismissal against CCC, Garcia, and Sy. They merely denied
dismissing Uy and insisted that he had poor performance in the company. The Labor Arbiter (LA)
dismissed the case because Uy resigned and opted not to report to work. The National Labor
Relations Commission (NLRC) reversed, finding that Uy’s dismissal was made under questionable
circumstances. The Court of Appeals (CA) reversed and dismissed the complaint for the same reasons
of the LA.
ISSUES:
Whether or not Uy was illegally dismissed, considering that he asked for his termination
paper and thereafter did not report to work.
RULING:
YES. Contrary to CCC’s theory that Uy’s act of turning over the company files and samples is
proof of his voluntary informal resignation rather than of the summary dismissal effected by
management, no other plausible explanation can be made of such immediate turn over except that
Uy directly confirmed from Sy herself that he was already being dismissed. The subsequent memos
sent to Uy’s residence after he did not anymore report for work only reinforce the conclusion that
the belated written notice of the charge against him his alleged failure to meet the prescribed sales
quota was an afterthought on the part of CCC who may have realized that they failed to observe due
process in terminating him. That CCC would still require a written explanation for Uy’s poor sales
performance after the latter already complied with Sy’s directive to turn over all his accountabilities
is simply inconsistent with their claim that petitioner offered to resign and voluntarily relinquished
possession of company files and samples when told of his impending transfer. In other words, Uy was
not given any opportunity to defend himself from whatever charges hurled by management against
him, such as poor sales performance as relayed to him by his supervisor, when Sy unceremoniously
terminated him which must have shocked him considering that his supervisor earlier advised that he
would just be transferred to another department. Under this scenario, Uy’s decision not to report for
work anymore was perfectly understandable, as the sensible reaction of an employee fired by no less
than the company president. It was indeed a classic case of dismissal without just cause and due
process, which is proscribed under our labor laws.
Resignation is defined as the voluntary act of employees who are compelled by personal
reasons to disassociate themselves from their employment. It must be done with the intention of
relinquishing an office, accompanied by the act of abandonment. In this case, the evidence on record
suggests that Uy did not resign; he was orally dismissed by Sy. It is this lack of clear, valid and legal
cause, not to mention due process, that made his dismissal illegal, warranting reinstatement and the
award of backwages. Moreover, the filing of a complaint for illegal dismissal just three weeks later is
difficult to reconcile with voluntary resignation. Had petitioner intended to voluntarily relinquish his
employment after being unceremoniously dismissed by no less than the company president, he
would not have sought redress from the NLRC and vigorously pursued this case against the
respondents. When there is no showing of a clear, valid and legal cause for the termination of
employment, the law considers it a case of illegal dismissal.
REDUNDANCY, RETRENCHMENT AND CLOSURE
GENUINO ICE COMPANY, INC. et al. v. ERIC LAYA and EDDIE BOY SODELA
G.R. No. 190001, 23 March 2011, THIRD DIVISION (Brion, J.)
For a valid retrenchment, the following must concur: a) proof that retrenchment is necessary to
prevent losses or impending losses; b) service of written notices to the employees and to the DOLE at
least one month prior to the indented date of retrenchment; and c)payment of separation pay equivalent
to 1 month pay or at least 1/2 month pay for every year of service.
Genuino Ice Company, Inc. (GICI) hired Eric Laya (Laya) and Eddie Boy Sodela (Sodela) as ice
plant machine operators. Due to continuous decline of demand for ice products, GICI was forced to
shut down part of its plant and to implement work rotation or reduction of workdays affecting its 7
workers including Laya and Sodelo. GICI issued an memorandum which had an effect of banning Laya
and Sodela from entering the premises. The two filed complaint for illegal dismissal. GICI alleged that
due to partial shut down of the company, GICI was excused from complying with the 30-day notice or
clearance requirement under the law. Labor Arbiter (LA) ruled that Laya and Sodelo were validly
retrenched but GICI failed to comply with procedural requirements. LA awarded their separation pay
equivalent to 1/2 month salary for every year of service in accordance with Article 283 of Labor Code.
On appeal, National Labor Relations Commission (NLRC) reversed the decision and found that Laya
and Sodelo were illegally dismissed. Court of Appeals (CA) found no grave abuse of discretion on the
part of NLRC as GICI failed to prove that it incurred or about to incur financial losses.
ISSUE:
Whether or not there had been a valid retrenchment
RULING:
NO. Under Article 283 of the Labor Code, there are 3 basic requisites for valid retrenchment:
a) proof that retrenchment is necessary to prevent losses or impending losses; b) service of written
notices to the employees and to the DOLE at least one month prior to the indented date of
retrenchment; and c)payment of separation pay equivalent to 1 month pay or at least 1/2 month pay
for every year of service. In the present case, there was no documentary evidence to substantiate the
claimed business losses. GICI failed to show its financial conditions prior and at the time of GICI
enforced its retrenchment program. Award of full backwages and separation pay in lieu of
reinstatement was proper. It is settled that an illegally dismissed employee is entitled to
reinstatement and full backwages. In the event that reinstatement is no longer feasible, employer
must pay him his separation pay. In the case at bar, GICI failed to prove that the dismissal was for a
duly authorized cause; thus, CA is correct in awarding full backwages and separation pay in lieu of
reinstatement since positions of Laya and Sodelo formerly held no longer exist.
PLASTIMER INDUSTRIAL CORPORATION AND TEO KEE BIN v. NATALIA C. GOPO, et al.
Article 283 of the Labor Code recognizes retrenchment to prevent losses as a right of the
management to meet clear and continuing economic threats or during periods of economic recession to
prevent losses. There is no need for the employer to wait for substantial losses to materialize before
exercising ultimate and drastic option to prevent such losses.
Due to the withdrawal of investments and shares of stocks in the company, Plastimer
Industrial Corporation decided to downsize and reorganize its business operations. Among those
affected were Natalia Gopo, Kleenia Velez, et al. who are respondents in this case. Gopo, et al. and
Plastimer entered into a Memorandum of Agreement (MOA) containing the terms and conditions of
the retrenchment. After the Department of Labor and Employment (DOLE) was notified of the plan
of Plastimer to reorganize its business, Gopo, et al. was made to sign a waiver and quitclaim.
But subsequently, Gopo, et al. filed a complaint against Plastimer alleging that they were
illegally dismissed. They also alleged that they did not voluntarily sign the waivers; that Plastimer
was not able to show a valid cause for the retrenchment; and that DOLE was not notified of
Plastimer’s plan to terminate the services of its employees 1 month from its effectivity. Meanwhile,
Plastimer contends that the reorganization was a management prerogative and that Gopo, et al.
received separation pay before the effectivity of their dismissal. Both the Labor Arbiter (LA) and the
National Labor Relations Commission (NLRC) ruled in favor of Plastimer. Upon appeal, the Court of
Appeals (CA) reversed the decision.
ISSUE:
Whether or not Gopo, et al. were illegally dismissed by Plastimer Industrial Corporation.
RULING:
NO. Plastimer submitted the notice of termination of employment to the DOLE on 26 May
2004. However, notice to the affected employees were given to them on 14 May 2004 or 30 days
before the effectivity of their termination from employment on 13 June 2004. While notice to the
DOLE was short of the one-month notice requirement, the affected employees were sufficiently
informed of their retrenchment 30 days before its effectivity. Plastimer’s failure to comply with the
one-month notice to the DOLE is only a procedural infirmity and does not render the retrenchment
illegal.
Here, the failure to fully comply with the one-month notice of termination of employment did
not render the retrenchment illegal but it entitles Gopo, et al. to nominal damages. The CA
acknowledged that an independent auditor confirmed Plastimer’s losses for the years 2001 and
2002. The fact that there was a net income in 2003 does not justify the CA ruling that there was no
valid reason for the retrenchment. Records showed that the net income of P6,185,707.05 for 2003
was not even enough for Plastimer to recover from the P52,904,297.88 loss in 2002. Article 283 of
the Labor Code recognizes retrenchment to prevent losses as a right of the management to meet clear
and continuing economic threats or during periods of economic recession to prevent losses. There is
no need for the employer to wait for substantial losses to materialize before exercising ultimate and
drastic option to prevent such losses. The SC agreed with the Labor Arbiter and the NLRC that Gopo,
et al. were sufficiently apprised of their rights under the waivers and quitclaims that they signed.
Each document contained the signatures of Edward Marcaida, Plastimer Industrial Corporation
Christian Brotherhood (PICCB) President, and Atty. Bayani Diwa, the counsel for the union, which
proved that Gopo, et al. were duly assisted when they signed the waivers and quitclaims.
ABANDONMENT
FUNCTIONAL, INC. vs. SAMUEL C. GRANFIL

G.R. No. 176377, 16 November 2011, SECOND DIVISION, (Perez, J)
Abandonment, as a just and valid ground for dismissal, requires the deliberate, unjustified
refusal of the employee to resume his employment, without any intention of returning.
Samuel C. Granfil was hired as key operator by petitioner Functional, Inc., a domestic
corporation engaged in the business of sale and rental of various business equipment, including
photocopying machines. As Key Operator, Granfil was tasked to operate the photocopying machine
rented by the National Bookstore at its SM Megamall Branch. An incident report suggests that Granfil
received payment for photocopying services instead of having the services paid at the store’s cashier.
Granfil maintains that what he received was a P200 tip said customer gave him in appreciation of his
assistance in xeroxing and organizing the batches of voluminous materials he asked to be
photocopied. He was then dismissed without being given the chance to explain his side.
The Labor Arbiter rendered a decision discounting Granfil’s illegal dismissal from
employment in view of his failure to prove with substantial evidence overt acts of termination on the
part of FI and its officers. The NLRC affirmed the decision of the LA. The CA on the other hand,
reversed the decision of the NLRC.
ISSUE:
Whether or not Granfil was illegally dismissed
RULING:
YES. In illegal dismissal cases like the one at bench, the burden of proof is upon the employer
to show that the employee’s termination from service is for a just and valid cause. Being a matter of
intention, abandonment cannot be inferred or presumed from equivocal acts. As a just and valid
ground for dismissal, it requires the deliberate, unjustified refusal of the employee to resume his
employment, without any intention of returning. Two elements must concur: (1) failure to report for
work or absence without valid or justifiable reason, and (2) a clear intention to sever the employer-
employee relationship, with the second element as the more determinative factor and being
manifested by some overt acts. The burden of proving abandonment is once again upon the employer
who, whether pleading the same as a ground for dismissing an employee or as a mere defense,
additionally has the legal duty to observe due process. Settled is the rule that mere absence or failure
to report to work is not tantamount to abandonment of work.
Viewed in the light of the foregoing principles, CA correctly ruled out FI’s position that Granfil
had abandoned his employment. The record is wholly bereft of any showing that FI required Granfil
to report to its main office or, for that matter, to explain his supposed unauthorized
absences. Absence must be accompanied by overt acts unerringly pointing to the fact that the
employee simply does not want to work anymore. Even then, FIs theory of abandonment was
likewise negated by Granfils filing the complaint for illegal dismissal, which evinced his desire to
return to work. In vigorously pursuing his action against FI before the Labor Arbiter, the NLRC and
the CA, Granfil clearly manifested that he has no intention of relinquishing his employment. In any
case, the fact that Granfil prayed for his reinstatement speaks against any intent to sever the
employer-employee relationship with FI.
E.G & I. CONSTRUCTION CORPORATION AND EDSEL GALEOS v. ANANIAS P. SATO, NILO
BERDIN, et al.
G.R. No. 182070, 16 February 2011, SECOND DIVISION (Nachura, J.)
The employer has the burden of proof to show the employee's deliberate and unjustified refusal
to resume his employment without any intention of returning. Mere absence is not sufficient. There must
be an unequivocal intent on the part of the employee to discontinue his employment.
Ananias Sato was hired by E.G & I. Construction Corporation as a grader operator. After
working for more than 13 years with the company, Sato took notice that his premium contributions
to the Social Security System (SSS) were not being remitted by E.G & I. When he called attention to
this anomaly, E.G & I. was removed from his job and was made to do manual labor until finally, his
employment was terminated. Nilo Berdin, Romeo Lacida, Jr. and Anecito Parantar, Sr. were also
employees of E.G & I. At the beginning of their employment, they were made to sign documents which
they thought were employment contracts. Later on, the Berdin, et al. were again ordered to sign
various documents but they refused because it was written in English, a language which they did not
understand. Because of their refusal to sign the documents, their employment was also terminated
and were not allowed to enter the company premises.
They all filed complaints for illegal dismissal and payment of money claims. E.G & I.
Construction denied the allegations of its former employees and claimed that Berdin, Lacida and
Parantar were the ones who abandoned their work despite having been advised to do so. With regard
to Sato, E.G & I. argued that the former complained to the SSS for its alleged non-remittance of his
contributions in order to retaliate against the latter for reprimanding Sato for having an illicit affair;
that Sato was guilty of habitual tardiness and incurring unexplained absences. The Labor Arbiter (LA)
ruled that Sato, et al. were indeed illegally dismissed. The National Labor Relations Commission
(NLRC), however, reversed the decision. But upon appeal to the Court of Appeals (CA), the court
reinstated the decision of the LA.
ISSUE:
1. Whether or not the CA erred in reinstating the decision of the LA, declaring that Sato, et al.
were illegally terminated from employment by E.G & I.
2. Whether or not are entitled to their monetary claims.
RULING:
1. NO. E.G & I. failed to prove that Sato, et al. were dismissed for just or authorized cause. In
an illegal dismissal case, the onus probandi rests on the employer to prove that the dismissal of an
employee is for a valid cause. For abandonment to exist, it is essential (a) that the employee must
have failed to report for work or must have been absent without valid or justifiable reason; and (b)
that there must have been a clear intention to sever the employer-employee relationship manifested
by some overt acts. The employer has the burden of proof to show the employee's deliberate and
unjustified refusal to resume his employment without any intention of returning. Mere absence is not
sufficient. There must be an unequivocal intent on the part of the employee to discontinue his
employment.
In this case, the reason why Sato, et al. failed to report for work was because E.G & I. barred
them from entering its construction sites. It is a settled rule that failure to report for work after a
notice to return to work has been served does not necessarily constitute abandonment. The intent to
discontinue the employment must be shown by clear proof that it was deliberate and unjustified. E.G
& I. failed to show overt acts committed by Sato, et al. from which it may be deduced that they had no
more intention to work. Sato, et al.’s filing of the case for illegal dismissal barely four (4) days from
their alleged abandonment is totally inconsistent with our known concept of what constitutes
abandonment.
2. As a rule, one who pleads payment has the burden of proving it. Even as the employee must
allege non-payment, the general rule is that the burden rests on the employer to prove payment,
rather than on the employee to prove non-payment. The reason for the rule is that the pertinent
personnel files, payrolls, records, remittances, and other similar documents which will show that
overtime, differentials, service incentive leave, and other claims of the worker have been paid are not
in the possession of the worker but in the custody and absolute control of the employer.
In this case, the submission of E.G & I. of the time records and payrolls of Sato, et al. only on
their appeal before the NLRC is contrary to elementary precepts of justice and fair play. Sato, et al.
were not given the opportunity to check the authenticity and correctness of the same. Thus, we
sustain the ruling of the CA in the grant of the monetary claims of Sato, et al. We are guided by the
time-honored principle that if doubts exist between the evidence presented by the employer and the
employee, the scales of justice must be tilted in favor of the latter.
DUE PROCESS
Notice Requirement
ROBINSONS GALLERIA/ROBINSONS SUPERMARKET CORP. and/or JESS MANUEL v. IRENE R.

RANCHEZ
The due process requirements under the Labor Code are mandatory and may not be supplanted
by police investigation or court proceedings.
Irene R. Ranchez (Ranchez) was a probationary employee of Robinsons Gallery/Robinsons

Supermarket Corporation (Robinsons) for a period of five months. She underwent two weeks of
training as a cashier before she was official hired. Two weeks before she was hired, Ranchez reported
to her supervisor the loss of cash amounting to PhP20,299, which she had placed inside the company
locker. Jess Manuel (Manuel), the Operations Manager of Robinsons, ordered Ranchez to be strip-
searched, but the search on her person and her personal belongings yielded nothing. Ranchez
acknowledged her responsibility for the loss, and requested that she be allowed to settle and pay the
lost amount. However, Manuel did not heed her request and instead reported the matter to the police.
Accordingly, an Information for Qualified THeft was filed against Ranchez, and the latter was
constrained to spend two weeks in jail for failure to immediately post a bail.
Ranchez filed a complaint against Robinsons and Manuel for illegal dismissal and damages.
Four months after she filed the complaint, Robinsons sent her a notice of termination and/or notice
of expiration of probationary employment. The Labor Arbiter (LA) dismissed her complaint, claiming
that at the time Ranchez filed her complaint, she was not yet dismissed by Robinsons. The National
Labor Relations Commission (NLRC) reversed the LA's decision. According to the NLRC, she was
denied due process, and that the search and subsequent filing of a criminal complaint against her
certainly amounted to constructive dismissal.
ISSUE:
Whether Ranchez was illegally terminated.

RULING:
YES. A probationary employee, like a regular employee, enjoys security of tenure. Article 283
of the Labor Code provides for the notice requirements before and employer may terminate an
employee. In sum, the Code requires that the employer shall furnish the worker, whose employment
is sought to be terminated, a written notice containing a statement of the causes of termination, and
shall afford the latter ample opportunity to be heard and to defend himself with the assistance of a
representative if he so desires, in accordance with company rules and regulations pursuant to the
guidelines set by the Department of Labor and Employment. The due process requirements under
the Labor Code are mandatory and may not be supplanted by police investigation or court
proceedings. The criminal aspect of the case is considered independent of the administrative aspect.
Thus, employers should not rely solely on the findings of the Prosecutor’s Office. They are mandated
to conduct their own separate investigation, and to accord the employee every opportunity to defend
himself.
In the instant case, Robinsons and Manuel failed to accord Ranchez substantive and
procedural due process. The haphazard manner in the investigation of the missing cash, which was
left to the determination of the police authorities and the Prosecutor’s Office, left Ranchez with no
choice but to cry foul. Administrative investigation was not conducted by petitioner Supermarket. On
the same day that the missing money was reported by respondent to her immediate superior, the
company already pre-judged her guilt without proper investigation, and instantly reported her to the
police as the suspected thief, which resulted in her languishing in jail for two weeks. Furthermore,
respondent was not represented by counsel when she was strip-searched inside the company
premises or during the police investigation, and in the preliminary investigation before the
Prosecutor’s Office.
ROMULO B. DELA ROSA v. MICHAELMAR PHILIPPINES, INC., et al.

If the dismissal is for a just cause, the lack of statutory due process should not nullify the
dismissal, or render it illegal or ineffectual. The violation of petitioner's right to due process only
warrants the payment of indemnity in the form of nominal damages, the amount of which is addressed
to the sound discretion of the Court, taking into consideration the relevant circumstances.
Romulo B. dela Rosa (Dela Rosa) was hired by respondent Michaelmar Philippines, Inc.,
(Michaelmar) for and on behalf of its principal Michaelmar Shipping Services, Inc. , as 3rd Engineer on
board the vessel MT Goldmar for a period of nine months. However, after two months, he was
discharged for his alleged poor performance, and was repatriated to the Philippines. Claiming
termination without just cause and due process, Dela Rosa filed a complaintn for illegal dismissal,
nonpayment of salaries/wages, payment of moral and exemplary damages and attorney’s fees with
the Labor Arbiter (LA), against respondents. Michaelmar prayed for the dismissal of the complaint.
It alleged that Dela Rosa was validly terminated. They averred that Dela Rosa’s work performance
was unsatisfactory, and that despite the advice given to him by his superiors, Dela Rosa’s job
performance did not improve; he continued to be incompetent and inefficient
The LA rendered a decision dismissing the complaint. The NLRC issued a

Resolution dismissing the appeal and affirming the LA. In so ruling, the NLRC sustained respondents
claim that Dela Rosa neglected his duty as 3rd Engineer and abandoned his job, justifying the
termination of his employment. On appeal, the Court of Appeals rendered a decision reversing the
NLRC. It held that respondents failed to allege and prove with particularity the charges against Dela
Rosa. Dela Rosas victory, however, was only fleeting because on a motion for reconsideration, the CA
rendered an Amended Decision dismissing his petition on the ground of mootness. The CA declared
that the Resolution of the NLRC sustaining Dela Rosa’s dismissal has already become final and
executory making it immutable and unalterable and its decision considered academic. Dela Rosa filed
a motion for reconsideration which was denied by the CA.
ISSUES
1. Whether the CA is correct in dismissing the petition on the ground of mootness

2. Whether Dela Rosa was validly dismissed
RULING
1. NO. A decision issued by a court becomes final and executory when such decision disposes
of the subject matter in its entirety or terminates a particular proceeding or action, leaving nothing
else to be done but to enforce by execution what has been determined by the court, such as when
after the lapse of the reglementary period to appeal, no appeal has been perfected.
The period or manner of appeal from the NLRC to the CA is governed by Rule 65, pursuant to
the ruling of this Court in St. Martin Funeral Home v. National Labor Relations Commission, to wit:
“.…the remedy of the aggrieved party is to timely file a motion for reconsideration
as a precondition for any further or subsequent remedy, and then seasonably
avail of the special civil action of certiorari under Rule 65, for which said Rule has
now fixed the reglementary period of sixty days from notice of the
decision. Curiously, although the 10-day period for finality of the decision of the
NLRC may already have lapsed as contemplated in Section 223 of the Labor Code,
it has been held that this Court may still take cognizance of the petition for
certiorari on jurisdictional and due process considerations if filed within the
reglementary period under Rule 65.”
Section 4 of Rule 65, as amended, states that the petition may be filed not later than sixty (60)
days from notice of the judgment, or resolution sought to be assailed.
Record shows that Dela Rosa received a copy of the November 24, 2005 Resolution of the
NLRC, denying his motion for reconsideration on December 8, 2005. He had sixty (60) days, or until
February 6, 2006, to file his petition for certiorari. February 6, 2006, however, was a Sunday. Thus,
Dela Rosa filed his petition the next working day, or on February 7, 2006. Undoubtedly, Dela Rosa’s
petition was timely filed. Indubitably, the issuance of an entry of judgment by the NLRC cannot render
Dela Rosas petition for certiorari as moot and academic. Thus, the CA erred for ruling otherwise.
2. YES. Indubitably, Dela Rosa was dismissed from employment for a just cause. Accordingly,
he is not entitled to any salary for the unexpired portion of his employment contract. However, we
note that Dela Rosa was not accorded due process. Under Article 277(b) of the Labor Code, the
employer must send the employee, who is about to be terminated, a written notice stating the causes
for termination, and must give the employee the opportunity to be heard and to defend himself. For
officers and crew who are working in foreign vessels involved in overseas shipping, there must be
compliance with the applicable laws on overseas employment, as well as with the regulations issued
by the Philippine Overseas Employment Administration, such as those embodied in the Standard
Contract for Seafarers Employed Abroad (Standard Contract). In this case, there was no showing that
respondents complied with the foregoing procedure. The only notice allegedly given to Dela Rosa
was a letter warning dated March 16, 2003. Such letter, however, did not cite the particular acts
constituting Dela Rosa’s alleged poor performance. Likewise, there was no formal investigation of the
charges. Certainly, respondents failed to observe the necessary procedural safeguards.
In Agabon v. NLRC, we ruled that if the dismissal is for a just cause, the lack of statutory due
process should not nullify the dismissal, or render it illegal or ineffectual. The violation of petitioner's
right to due process only warrants the payment of indemnity in the form of nominal damages, the
amount of which is addressed to the sound discretion of the Court, taking into consideration the
relevant circumstances. Accordingly, we deem the amount of P30,000.00 as nominal damages
sufficient vindication of Dela Rosas right to due process under the circumstances of this case.
QUIRICO LOPEZ v. ALTURAS GROUP OF COMPANIES and/or MARLITO UY

Dismissals have two facets: the legality of the act of dismissal, which constitutes substantive due
process, and the legality of the manner of dismissal which constitutes procedural due process.
Quirico Lopez (Lopez) was hired by respondent Alturas Group of Companies (Alturas) as
truck driver. Ten years later, he was dismissed after he was allegedly caught by the security guards
in the act of attempting to smuggle out of the company premises 60 kilos of scrap iron worth P840
aboard the company’s van that was then assigned to him. When questioned, Lopez allegedly admitted
to the security guard that he was taking out the scrap iron consisting of lift springs out of which he
would make axes.
Lopez denied the allegations by a handwritten explanation. Finding his explanation

unsatisfactory, Alturas terminated his employment by Notice of Termination on the grounds of loss
of trust and confidence, and of violation of company rules and regulations. Lopez thereupon filed a
complaint against respondent company for illegal dismissal and underpayment of wages. He claimed
that the smuggling charge against him was fabricated to justify his illegal dismissal; that the filing of
the charge came about after he reported the loss of the original copy of his pay slip, which report, he
went on to claim, Alturas company took to mean that he could use the pay slip as evidence for filing
a complaint for violation of labor laws; and that on account of the immediately stated concern of
Alturas, it forced him into executing an affidavit that if the pay slip is eventually found, it could not
be used in any proceedings between them.
The Labor Arbiter, held that Lopez’s dismissal was justified, for he, a truck driver, held a
position of trust and confidence, and his act of stealing company property was a violation of the trust
reposed upon him. The NLRC set aside the Labor Arbiters’ finding that Alturas’ evidence did not
suffice to warrant the termination of Lopez’s services. The appellate court reversed the NLRC
ruling. It held that respondent company was justified in terminating petitioners employment on the
ground of loss of trust and confidence. Albeit the appellate court found that Lopez’s dismissal was for
a just cause, it held that due process was not observed when Alturas failed to give him a chance to
defend his side in a proper hearing.
ISSUES:
1. Whether Lopez was illegally dismissed.
2. Whether Lopez was afforded due process.
RULING:
1. NO. Dismissals have two facets: the legality of the act of dismissal, which constitutes
substantive due process, and the legality of the manner of dismissal which constitutes procedural due
process. As to substantive due process, the Court finds that respondent company’s loss of trust and
confidence arising from petitioners smuggling out of the scrap iron, conpounded by his past acts of
unauthorized selling cartons belonging to respondent company, constituted just cause for
terminating his services.
Petitioner, a driver assigned with a specific vehicle, was entrusted with the transportation of
respondent company’s goods and property, and consequently with its handling and protection,
hence, even if he did not occupy a managerial position, he can be said to be holding a position of
responsibility. As to his act principal ground for his dismissal his attempt to smuggle out the scrap
iron belonging to respondent company, the same is undoubtedly work-related.
Respondent company’s charge against petitioner was amply proven by substantial evidence
consisting of the affidavits of various employees of respondent. Contrary to the NLRCs observation,
the security guard who apprehended petitioner, Gerardo Luega, actually executed a statement
relative to the smuggling out of scrap iron, which was attached to, and served as basis for the filing
of, the corresponding complaint for Qualified Theft. Petitioners claim that he was framed up after he
allegedly lost his pay slip to draw respondent company to suspect that he might file a labor complaint
for underpayment does not inspire credence.
2. YES. Procedural due process has been defined as giving an opportunity to be heard before
judgment is rendered. Petitioner was given the opportunity to explain his side when he was informed
of the charge against him and required to submit his written explanation with which he
complied. Parenthetically, the Court finds that it was error for the NLRC to opine that petitioner
should have been afforded counsel or advised of the right to counsel. The right to counsel and the
assistance of one in investigations involving termination cases is neither indispensable nor
mandatory, except when the employee himself requests for one or that he manifests that he wants a
formal hearing on the charges against him. In petitioners case, there is no showing that he requested
for a formal hearing to be conducted or that he be assisted by counsel. Verily, since he was furnished
a second notice informing him of his dismissal and the grounds therefor, the twin-notice requirement
had been complied with to call for a deletion of the appellate courts award of nominal damages to
petitioner.
NATIONAL LABOR RELATIONS COMMISSION
AGG TRUCKING AND/OR ALEXANG GAEID v. MELANIO B. YUAG

A writ of certiorari is a remedy to correct errors of jurisdiction, for which reason the Court of
Appeals must clearly show that the National Labor Relations Commission has no jurisdiction to issue an
order or to render a decision.
Due to delivery shortages, Alex Ang Gaeid–owner of AAG Trucking–monitored all his drivers,
which included Melanio Yuag, by instructing them to report to him their location from time to time
through their mobile phones. He also required them to make their delivery trips in convoy, in order
to avoid illegal sale of cargo along the way. Yuag, along with 20 other drivers, were tasked to deliver
bags of sugar from Cagayan de Oro City to Davao City. All drivers, with the exception of Yuag who
could not be reached through his cellphone, reported their location as instructed. Afterwards,
everyone, except Yuag, communicated that the delivery of their respective cargoes had been
completed. The Coca-Cola Plant in Davao later reported that the delivery had a suspiciously
enormous shortage.
Yuag reported to Gaeid’s office. Gaeid asked Yuag to explain why the latter had not contacted
him for two days, and he had not gone in convoy with the other trucks, as he was told to do. Yuag
replied that the battery of his cellphone had broken down. Gaeid afterwards told him to just take a
rest or, which Yuag construed it as a dismissal. He demanded that it be done in writing, but Gaeid
merely reiterated that Yuag should just take a rest in the meanwhile. The former alleged that Yuag
had offered to resign and demanded separation pay. Yuag filed a complaint for illegal dismissal.
Yuag argued that he was whimsically dismissed, just because he had not been able to answer
his employer's call during the time of the delivery. When Gaeid shouted at him to take a rest, Yuag
then realized that he was being dismissed. The Labor Arbiter (LA) declared Yuag’s dismissal illegal.
The National Labor Relations Commission (NLRC) reversed the decision. The NLRC likewise denied
Yuag’s motion for reconsideration for being filed out of time, thus he filed a petition for certiorari
under Rule 65 before the Court of Appeals (CA), which completely reversed said judgment. Before
the Supreme Court (SC), Gaeid argues that the CA erred in reversing the NLRC decision without any
finding of grave abuse of discretion amounting to lack or excess of jurisdiction.
ISSUE:
Whether or not the reversal of the decision by the CA was proper.
RULING:
NO. A writ of certiorari is a remedy to correct errors of jurisdiction, for which reason it must
clearly show that the NLRC has no jurisdiction to issue an order or to render a decision. Rule 65 of
the Rules of Court has instituted the petition for certiorari to correct acts of any tribunal, board or
officer exercising judicial or quasi-judicial functions with grave abuse of discretion amounting to lack
or excess of jurisdiction. This remedy serves as a check on acts, either of excess or passivity that
constitute grave abuse of discretion of a judicial or quasi-judicial function.
Gaeid is correct in its argument that there must first be a finding on whether the NLRC
committed grave abuse of discretion and on what these acts were. In this case, the CA seemed to have
forgotten that its function in resolving a petition for certiorari was to determine whether there was
grave abuse of discretion amounting to lack or excess of jurisdiction on the part of NLRC. The CA
proceeded to review the records and to rule on issues that were no longer disputed during the appeal
to the NLRC, such as the existence of an employer-employee relationship. The pivotal issue before
the NLRC was whether Gaeid’s telling Yuag to take a rest, or to have a break, was already a positive
act of dismissing him. This issue was not discussed by the CA. The SC reviewed the NLRC Resolution
that reversed the LA Decision and found nothing in it that was whimsical, unreasonable or patently
violative of the law. It was the CA which erred in finding faults that were inexistent in the NLRC
Resolution.
On the issue of the propriety of entertaining the Petition for Certiorari despite the prescribed
Motion for Reconsideration with the NLRC, we find another error committed by the CA. When Yuag
failed to file a Motion for Reconsideration of the NLRC’s 30 November 2006 Resolution within the
reglementary period, the Resolution attained finality and could no longer be modified by the Court
of Appeals. A motion for reconsideration filed out of time cannot reopen a final and executory
judgment of the NLRC. Untimeliness in filing motions or petitions is not a mere technical or
procedural defect, as leniency regarding this requirement will impinge on the right of the winning
litigant to peace of mind resulting from the laying to rest of the controversy.
REMEDIES
BERNADETH LONDONIO and JOAN CORCORO v. BIO RESEARCH, INC. and WILSON Y. ANG
G.R. No. 191459, 17 January 2011, THIRD DIVISION (Carpio-Morales, J.)
An employee’s execution of a final settlement and receipt of amounts agreed upon do not
foreclose his right to pursue a claim for illegal dismissal
Bernadeth E. Londonio (Londonio) and Joan T. Corcoro (Corcoro) were hired by Bio
Research, Inc. (Bio Research) as graphic/visual artists. Bio Research informed its employees,
including Londonio and Corcoro, that it would be severing their employment in order to prevent
losses for the company on April 30, 2005. On 9 May 2005, Bio Research filed with the Department of
Labor and Employment (DOLE) a Report stating that it was retrenching 18 of its employees, including
Londonio and Corcoro, to prevent losses. Londonio and Corcoro were retrenched on 26 and 18 of
May 2005 respectively. While Corcoro accepted her retrenchment pay and executed a Quitclaim and
Waiver, Londonio refused to accept hers. They both filed a complaint for illegal dismissal against Bio
Research claiming that their dismissal was done in bad faith and tainted with malice, being retaliatory
in nature, following the filing by Londonio of a complaint against Jose Ang, Jr. (Ang), one of Bio
Research's managers, for sexual harassment. Also, to refute Bio Research's claim that it had been
incurring business losses, Corcoro cited the recommendation for her regularization eighteen days
before she received a copy stating that they would be retrenched.
Bio Research denied that the sexual harassment complaint had anything to do with their
decision to terminate the two employees. It further stated that, since Corcoro already received her
separation pay and in fact signed a waiver and quitclaim in its favor, she is estopped from challenging
the validity of her dismissal. The Labor Arbiter (LA) ruled in favor of Londonio and Corcoro, stating
that Bio Research failed to prove its financial losses, and that it also failed to comply with the
procedural requirements stated in Article 283 of the Labor Code. The National Labor Relations
Commission (NLRC) affirmed the LA’s ruling insofar as Londonio is concerned. However, with
respect to Corcoro, the NLRC ruled that she can no longer question the legality of her dismissal in
light of her execution of a quitclaim and waiver.
ISSUE:
1. Whether Londonio and Corcoro were illegally dismissed.

2. Whether Corcoro can still question the legality of her dismissal.
RULING:
1. YES. Not only did Bio Research fail to submit in evidence its audited financial statements
to show its financial condition prior to and at the time it enforced its retrenchment program; it also
failed to show that it adopted fair and reasonable standards in ascertaining who would be retained
or dismissed among its employees. As such, the Court cannot give credence to the argument of Bio
Research that they have validly retrenched Londonio and Corcoro.
2. YES. An employee’s execution of a final settlement and receipt of amounts agreed upon do
not foreclose his right to pursue a claim for illegal dismissal. In this case, because Corcoro was
illegally retrenched, she is thus entitled to reinstatement without loss of seniority rights and
privileges, as well as to payment of full backwages from the time of her separation until actual
reinstatement, less the amount of P9,990.14 which she received as retrenchment pay.
RELIEFS FOR ILLEGAL DISMISSAL
Reinstatement
PFIZER, INC. And REY GERARDO BACARRO, et al. v. GERALDINE VELASCO

G.R. No. 177467, 9 March 2011, FIRST DIVISION (Leonardo- De Castro, J.)
Reinstatement pending appeal is immediately executory. An order for reinstatement entitles an

employee ti receive his accrued backwages from the moment the reinstatement order was issued up to
the date when the same was reversed by higher court without fear of refunding what he had received.
Geraldine Velasco (Velasco) was employed with Pfizer, Inc. (Pfizer) as Professional Health
Care Representative. Velasco had a medical work up for her high- risk pregnancy and was
subsequently advised bed rest which resulted in her extending her leave of absence. She filed sick
leave, vacation leave, and leave without pay. While still on leave, Velasco received a “Show Cause
Notice” mentioning about an investigation on her possible violations of company work rules. She was
advised that she was being placed under preventive suspension. Velasco recevied a second notice
informing her of additional developments in their investigation. The same day, Velasco filed a
complaint for illegal suspension with money claims. She received third notice to show cause and
subsequently, notice to terminate. Labor Arbiter ruled that the dismissal of Velasco illegal, ordering
her reinstatement with backwages. National Labor Relations Commission (NLRC) affirmed the same.
On appeal, Court of Appeals (CA) found that termination was with just cause and in accordance with
two notice rule. However, CA modified its decision when it affirmed the validity of dismissal but
ordered Pfizer to pay Velasco wages from the date of the LA’s decision up to CA decision.
ISSUE:
Whether or not Pfizer is required to pay wages from the date of order of reinstatement until
the date when CA rendered its decision upholding validity of dismissal
RULING:
YES. The order of reinstatement is immediately executory. The unjustified refusal of employer
to reinstate dismissed employee entitles him to payment of his salaries effective from time the
employer failed to reinstate him. Unless there is restraining order issued, it is ministerial upon LA to
implement the order of reinstatement. In the case at bar, CA correctly ordered the payment of wages
due to Velasco from the time order of reinstatement was issued because Pfizer did not immediately
admit Velasco back to work. It waited for the resolution of NLRC before it require Velasco to report
back to work. Also, the reinstatement that Pfizer referred to in the letter it sent to Velasco does not
comply with the law. Under Article 223 of the Labor Code, an employee entitled to reinstatement shall
either be admitted to work under the same terms and conditions prevailing prior to his dismissal or
at the option of employer, merely reinstated in the payroll. It presupposes that the position previously
held still exists or there is unfilled position which is substantially equivalent or of similar nature as
the one previously occupied. Pfizer return-to-work directive relocated Velasco without reason or
justification; thus, no bona fide reinstatement to speak of prior the reversal by the CA. It is to be noted
that even if order of reinstatement is reversed on appeal, it is obligatory for employer to pay wages
during period of appeal until reversal by higher court. If the employee had been reinstated but the
order was later on reversed, employee is not required to reimburse whatever salary he received.
Accrued Wages
ISLRIZ TRADING/VICTOR HUGO LU v. EFREN CAPADA, et al.

G.R. No. 168501, 31 January 2011, FIRST DIVISION (Del Castillo, J.)
Employees are entitled to their accrued salaries during the period between the Labor Arbiter’s
order of reinstatement pending appeal and the resolution of the National Labor Relations Commission
(NLRC) overturning that of the Labor Arbiter. The employees, however, are barred from recovering the
accrued wages if the following are present: (1) there is actual delay or that the order of reinstatement
pending appeal was not executed prior to its reversal; and (2) the delay is not due to the employer’s
unjustified act or omission.
Efren Capada, Lauro Licup, Norberto Nigos and Godofredo Magnaye, Ronnie Abel, Arnel
Siberre, Edmundo Capada, Nomerlito Magnaye and Alberto Dela Vega (Capada, et al.) were employees
of Islriz Trading, a gravel and sand business owned and operated by Victor Hugo Lu. Claiming that
they were illegally dismissed, Capada, et al. filed a Complaint for illegal dismissal and non-payment
of overtime pay, holiday pay, rest day pay, allowances and separation pay against Islriz Trading/Lu.
Labor Arbiter. Labor Arbiter Waldo Emerson R. Gan (Gan) declared Islriz Trading guilty of illegal
dismissal and ordered the reinstatement of Capada, et al. to their former positions without loss of
seniority rights and the payment of full backwages from date of dismissal to actual reinstatement.
Aggrieved, Capada, et al. appealed to the NLRC which granted the appeal. The NLRC ordered Capada,
et al.’s reinstatement but without backwages. Capada, et al. filed a Motion for Reconsideration but
the same was likewise denied. Meanwhile, Capada, et al. filed with the Labor Arbiter an Ex-Parte
Motion to Set Case for Conference with Motion. They averred therein that since the Decision of Labor
Arbiter Gan ordered their reinstatement, a Writ of Execution was already issued for the enforcement
of its reinstatement aspect as same is immediately executory even pending appeal. But this
notwithstanding and despite the issuance and subsequent finality of the NLRC Resolution which
likewise ordered Capada, et al.’s reinstatement, Lu still refused to reinstate them. Thus, Capada, et al.
prayed that in view of the orders of reinstatement, a computation of the award of backwages be made
and that an Alias Writ of Execution for its enforcement be issued. The case was then set for pre-
execution conference. Both parties appeared thereat but failed to come to terms on the issue of the
monetary award. Hence, the office of the Labor Arbiter through Fiscal Examiner II Ma. Irene T.
Trinchera (Fiscal Examiner Trinchera) issued a Computation of Capada, et al.’s accrued salaries. Islriz
Trading/Lu questioned this computation considering that Labor Arbiter Gan’s Decision had already
been reversed and set aside by the NLRC and that therefore there should be no monetary award.
Nevertheless, Labor Arbiter Danna M. Castillon (Castillon) still issued a Writ of Execution to enforce
the monetary award in accordance with the computation. Accordingly, the Sheriff issued a Notice of
Sale/Levy on Execution of Personal Property.
In an effort to forestall this impending execution, Islriz Trading/Lu then filed a Motion to
Quash Writ of Execution with Prayer to Hold in Abeyance of Auction Sale and a Supplemental Motion
to Quash/Stop Auction Sale. He also served upon the Sheriff a letter of protest. All of these protest
actions proved futile as the Sheriff later submitted his Report informing the Labor Arbiter that he had
levied some of Islriz Trading/Lu personal properties and the levied properties were awarded to
Capada, et al.. Later, Capada, et al. claimed that although Islriz Trading/Lu levied properties were
already awarded to them, they could not take full control, ownership and possession of said
properties because petitioner had allegedly padlocked the premises where the properties were
situated. Hence, they asked Labor Arbiter Castillon to issue a break-open order. For his part and in a
last ditch effort to nullify the writ of execution, Islriz Trading/Lu filed a Motion to Quash Writ of
Execution, Notice of Sale/Levy on Execution of Personal Property and Auction Sale on Additional
Grounds. Labor Arbiter Castillon denied Islriz Trading/Lu’s motion and granted Capada, et al.’s
request for a break open. Undeterred, petitioner brought the matter to the CA through a Petition
for Certiorari. The CA dismissed the petition. Petitioners Motion for Reconsideration was also
denied.
ISSUE:
Whether the employees may collect their wages during the period between the Labor
Arbiter’s order of reinstatement pending appeal and the NLRC’s Resolution overturning that of the
Labor Arbiter.
RULING:
YES. The Court applied the two-fold test used in Garcia v. Philippine Airlines Inc. The two-fold
test in determining whether an employee is barred from recovering his accrued wages, to wit: (1)
there must be actual delay or that the order of reinstatement pending appeal was not executed prior
to its reversal; and (2) the delay must not be due to the employer’s unjustified act or omission. If the
delay is due to the employer’s unjustified refusal, the employer may still be required to pay the
salaries notwithstanding the reversal of the Labor Arbiters Decision.
Was there an actual delay or was the order of reinstatement pending appeal executed prior to its
reversal? As can be recalled, Labor Arbiter Gan issued his Decision ordering respondents
reinstatement on December 21, 2001, copy of which was allegedly received by petitioner on February
21, 2002. On March 4, 2002, petitioner appealed said decision to the NLRC. A few days later or
on March 11, 2002, respondents filed an Ex-Parte Motion for Issuance of Writ of Execution relative to
the implementation of the reinstatement aspect of the decision. On April 22, 2002, a Writ of Execution
was issued by Labor Arbiter Gan. However, until the issuance of the September 5, 2002 NLRC
Resolution overturning Labor Arbiter Gans Decision, petitioner still failed to reinstate respondents
or effect payroll reinstatement in accordance with Article 223 of the Labor Code. This was what
actually prompted respondents to file an Ex-Parte Motion to Set Case for Conference with
Motion wherein they also prayed for the issuance of a computation of the award of backwages and
Alias Writ of Execution for its enforcement. It cannot therefore be denied that there was an actual
delay in the execution of the reinstatement aspect of the Decision of Labor Arbiter Gan prior to the
issuance of the NLRC Resolution overturning the same.
Now, the next question is: Was the delay not due to the employer’s unjustified act or omission? Notably,
what petitioner gave as reason in not immediately effecting reinstatement after he was served with
the Writ of Execution dated April 22, 2002 was that he would first refer the matter to his counsel as
he could not effectively act on the order of execution without the latters advice. He gave his word that
upon conferment with his lawyer, he will inform the Office of the Labor Arbiter of his action on the
writ. Petitioner, however, without any satisfactory reason, failed to fulfill this promise and
respondents remained to be not reinstated until the NLRC resolved petitioners appeal. Evidently, the
delay in the execution of respondents’ reinstatement was due to petitioners unjustified refusal to
effect the same.
Hence, the conclusion is that respondents have the right to collect their accrued salaries
during the period between the Labor Arbiters Decision ordering their reinstatement pending appeal
and the NLRC Resolution overturning the same because petitioners failure to reinstate them either
actually or through payroll was due to petitioners unjustified refusal to effect reinstatement.
Backwages
BPI EMPLOYEES UNION – METRO MANILA and ZENAIDA UY v. BANK OF THE PHILIPPINE
ISLANDS
G.R. No. 178699- G.R. No. 178735, 21 September 2011, FIRST DIVISION, (Del Castillo, J.)
The base figure in computing the award of back wages to an illegally dismissed employee is the
employee’s basic salary plus regular allowances and benefits received at the time of dismissal,
unqualified by any wage and benefit increases granted in the interim.
In a previous case for illegal dismissal filed by the BPI Employees Union-Metro Manila (the
Union) and Zenaida Uy (Uy) against Bank of the Philippine Islands (BPI), the Voluntary Arbitrator
(VA) held that Uy was illegal dismissed. Consequently, the VA ordered the reinstatement of Uy and
ordered BPI to pay Uy her full back wages, including all her other benefits under the Collective
Bargaining Agreement (CBA) and attorney’s fees. This was affirmed by the CA but instead of
reinstatement, CA ordered BPI to pay Uy her separation pay and instead of full back wages, the CA
fixed Uy's back wages to three years.
When the case reached the Supreme Court (Court), the Court modified the decision of the CA
and ordered BPI to pay Uy backwages from the time of her illegal dismissal until her actual
reinstatement. This decision became final and executory. Subsequently, Uy and the Union moved for
the issuance of a writ of execution. In her motion, Uy alleged that her back wages should be computed
on the current wage level and included all the increases in wages and benefits under the CBA that
were granted during the entire period of her illegal dismissal. In opposition, BPI claimed that the
basis for the computation of back wages should be the employee’s wage rate at the time of dismissal.
The VA ruled in favor of Uy and the Union holding that full back wages should include all wage and
benefit increases, including new benefits granted during the period of dismissal.
BPI elevated the case with the CA. BPI claimed that the VA erred in the computation of
backwages when it include benefits given by BPI during the interim period between Uy’s dismissal
until her reinstatement. Hence, BPI averred that the VA strayed with the final and executory decision
by the Supreme Court. Initially, the CA ruled that the VA erroneously computed Uy's back wages.
However both parties moved for reconsideration, the CA amended its decision holding that the
computation of Uy’s full back wages, as defined under Republic Act No. 6715, should be based on the
basic salary at the time of her dismissal plus the regular allowances that she had been receiving
likewise at the time of her dismissal. It further held that any increase in the basic salary occurring
after Uy’s dismissal as well as all benefits given after said dismissal should not be awarded to her in
consonance with settled jurisprudence on the matter. The CA deleted the award of CBA signing bonus
and other benefits. However, it held that the teller’s functional allowance should rightfully be given
to Uy as a regular bank teller as well as the holiday pay and monetary equivalent of vacation and sick
leave benefits. Both parties appeal with the SC.
ISSUE:
Whether or not the computation of backwages should include salary increases and CBA
benefits
RULING:
NO. Jurisprudence dictates that award of back wages is without qualifications and
deductions, that is, "unqualified by any wage increases or other benefits that may have been received
by co-workers who were not dismissed." It is likewise settled that the base figure to be used in the
computation of back wages is pegged at the wage rate at the time of the employee’s dismissal
unqualified by deductions, increases and/or modifications.
In the dispositive portion of Its Decision of March 31, 2005, the Supreme Court expressly
awarded Uy full backwages from the time of her dismissal up to the time of her actual reinstatement.
The full backwages, as referred to in the body of the decision pertains to "backwages" as defined in
Republic Act No. 6715. Under said law, and as provided in numerous jurisprudence, "full backwages"
means backwages without any deduction or qualification, including benefits or their monetary
equivalent the employee is enjoying at the time of his dismissal. Clearly, it is the intention of the
Supreme Court to grant unto Uy full backwages as defined under RA 6715. Consequently, any benefit
or allowance over and above that allowed and provided by said law is deemed excluded under said
SC Decision. The CBA benefits awarded by Public Respondent are not within the benefits under RA
6715. Said benefits are not to be included in the backwages.
SEPARATION PAY
JULIET G. APACIBLE v. MULTIMED INDUSTRIES INCORPORATED, et al.

G.R. No. 178903, 30 May 2011, THIRD DIVISION (Carpio Morales, J.)
Separation pay is only warranted when the cause for termination is not attributable to the
employees fault, such as those provided in Articles 283 and 284 of the Labor Code, as well as in cases of
illegal dismissal in which reinstatement is no longer feasible. It is not allowed when an employee is
dismissed for just cause, such as serious misconduct.
Juliet Apacible was hired by respondent Multimed Industries Incorporated (Multimed) as

Hospital Sales Representative. She rose from the ranks to become Assistant Area Sales Manager for
Cebu Operations, the position she held at the time she was separated from the service in 2003.
Apacible was informed by her immediate superior, that she would be transferred to the company’s
main office in Pasig City on account of the ongoing reorganization. On even date, she was placed
under investigation for the delayed released of BCRs (cash budget for customer representation in
sealed envelopes which are given to loyal clients) which she received for distribution earlier in July
2003. Finding that the delay in releasing the BCRs amounted to loss of trust and confidence, Apacible
was given the option to resign. She claims that the company gave her four options: resignation,
termination, availment of an early retirement package worth P40,000, or transfer to Pasig City.
Without availing of any option, petitioner took a leave of absence. Multimed sent her a memorandum-
directive for her to immediately report to the head office in Pasig City and to return the company
vehicle assigned to her to the Cebu Office within 24 hours. Apacible did not heed the directive and
she instead filed an application for sick leave. In several letters to Multimed, Apacible’s counsel, Atty.
Montenegro, reiterated that she was not transferring to Manila and that if the company wanted her
out of the company, separation pay must be paid. Multimed sent Apacible a notice of termination
for insubordination, prompting her to file a complaint for illegal dismissal, non-payment of overtime
pay, 13th month pay, service incentive leave pay, separation pay, damages and attorneys fees before
the Labor Arbiter.
The Labor Arbiter dismissed Apacible’s complaint, ruling that she was dismissed for just
cause, i.e., fraud or loss or trust and confidence under Article 282 (a) and (c) of the Labor Code. The
NLRC affirmed the Labor Arbiters decision but on a different ground: petitioner’s refusal to obey the
transfer orders which amounted to insubordination. The NLRC, however, granted petitioner
separation pay by way of financial assistance. The Court of Appeals modified the NLRC Decision
ruling that Apacible was not entitled to separation pay because, contrary to the NLRC’s finding, she
lacked good faith. Apacible then instituted the present petition in which she prays for the restoration
of the award of the separation pay by way of financial assistance.
ISSUE:
Whether Apacible is entitled to separation pay.
RULING:
NO. Petitioner was, it bears reiteration, dismissed for wilfully disobeying the lawful order of
her employer to transfer from Cebu to Pasig City. As correctly noted by the appellate court, petitioner
knew and accepted respondent company’s policy on transfers when she was hired and was in fact
even transferred many times from one area of operations to another Bacolod City, Iloilo City and
Cebu.
Reno Foods, Inc. v. Nagkakaisang Lakas ng Manggagawa (NLM))-Katipunan explains the

propriety of granting separation pay in termination cases in this wise:
The law is clear. Separation pay is only warranted when the cause for
termination is not attributable to the employees fault, such as those provided in
Articles 283 and 284 of the Labor Code, as well as in cases of illegal dismissal in which
reinstatement is no longer feasible. It is not allowed when an employee is dismissed
for just cause, such as serious misconduct.
Clearly, petitioner’s adamant refusal to transfer, coupled with her failure to heed the order
for her return the company vehicle assigned to her and, more importantly, allowing her counsel to
write letters couched in harsh language to her superiors unquestionably show that she was guilty of
insubordination, hence, not entitled to the award of separation pay.
DUP SOUND PHILS. and/or MANUEL TAN v. COURT OF APPEALS and CIRILO A. PIAL
Where reinstatement is no longer viable as an option, separation pay equivalent to one (1)
month salary for every year of service should be awarded as an alternative.
Cirilo A. Pial (Pial) filed a complaint for illegal dismissal with the NLRC. Pial alleged that he
was an employee of DUP Sound Phils. (DUP) owned and managed by Manuel Tan (Tan). Pial got sick
and absented himself from work. When he got well the following day, he called up their office in
accordance with his employer's policy that any employee who gets absent shall first call their office
before reporting back to work. However, after three weeks, without receiving any notice, the office
secretary advised him to look for another job because, per instruction of Tan, he is no longer allowed
to work at DUP. Pial prayed for the payment of his unpaid service incentive leave pay, full backwages,
separation pay, moral and exemplary damages as well as attorney's fees.
DUP and Tan denied the material allegations of Pial contending that the latter failed to report
for work following an altercation with his supervisor the previous day. When Pial called up their
office and informed the office secretary that he will be going back to work, he failed to report for work
on the said date. DUP and Tan reiterated that Pial was never dismissed, instead, it was his unilateral
decision not to work at DUP anymore.
The Labor Arbiter (LA) declared Pial to have been illegally dismissed and ordering DUP and
Tan to reinstate him to his former position and pay him backwages, cost of living allowance, service
incentive leave pay and attorney's fees. On appeal, the NLRC modified the Decision of the LA by
deleting the award of backwages and attorney's fees. The NLRC ruled that there was no illegal
dismissal on the part of DUP and Tan, but neither was there abandonment on the part of Pial.
Pial then filed a special civil action for certiorari with the CA. The CA issued a decision setting aside
the decision of the NLRC and reinstating that of the LA.
ISSUE:
Whether Pial was illegally dismissed.
RULING:
YES. The settled rule in labor cases is that the employer has the burden of proving that the
employee was not dismissed, or, if dismissed, that the dismissal was not illegal, and failure to
discharge the same would mean that the dismissal is not justified and, therefore, illegal. In the instant
case, what betrays petitioners' claim that private respondent was not dismissed from his
employment but instead abandoned his job is their failure to prove that the latter indeed stopped
reporting for work without any justifiable cause or a valid leave of absence. Petitioners merely
presented the affidavits of their office secretary which narrated their version of the facts. These
affidavits, however, are not only insufficient to prove their defense but also undeserving of credence
because they are self-serving.
The consistent rule is that the employer must affirmatively show rationally adequate
evidence that the dismissal was for a justifiable cause. In addition, the employer must also observe
the requirements of procedural due process. In the present case, petitioners failed to submit
sufficient evidence to show that private respondent's dismissal was for a justifiable cause and in
accordance with due process.
This Court has ruled in many instances that reinstatement is no longer viable where, among
others, the relations between the employer and the employee have been so severely strained, that it
is not in the best interest of the parties, nor is it advisable or practical to order reinstatement, or
where the employee decides not to be reinstated. In the instant case, the resulting circumstances
show that reinstatement would be impractical and would hardly promote the best interest of the
parties. Resentment and enmity between petitioners and private respondent necessarily strained the
relationship between them or even provoked antipathy and antagonism as shown by the acts of the
parties subsequent to the order of reinstatement. Besides, private respondent expressly prayed for
an award of separation pay in lieu of reinstatement from the very start of the proceedings before the
Labor Arbiter. By so doing, he forecloses reinstatement as a relief by implication.
EXECUTION OF JUDGEMENT
PAQUITO V. ANDO v. ANDRESITO Y. CAMPO, et al.

G.R. No. 184007, 16 February 2011. SECOND DIVISION (Nachura, J.)
Regular courts have no jurisdiction to hear and decide questions which arise from and are
incidental to the enforcement of decisions, orders, or awards rendered in labor cases by appropriate
officers and tribunals of the Department of Labor and Employment. To hold otherwise is to sanction
splitting of jurisdiction which is obnoxious to the orderly administration of justice.
Andresito Campo and his co-employees were working as pilers or haulers of Premier Allied
and Contracting Services, Inc. (PACSI) when their services were terminated. They then filed a
complaint for illegal dismissal and money claims with the National Labor Relations Commission
(NLRC). Both the Labor Arbiter (LA) and the NLRC ruled in favor of Campo, et al. When the decision
became final, Campo, et al. moved for its execution. A Notice of Sale on Execution of Personal Property
was issued. The subject property, however, was in the name of Paquito Ando, then President of PACSI,
and his wife. This prompted Ando to filed an action for prohibition and damages with prayer for the
issuance of a temporary restraining order (TRO) before the Regional Trial Court (RTC), arguing that
the subject property was owned by him and his wife, not of the corporation, therefore, it cannot be
the subject of execution.
The RTC ruled that it had no jurisdiction over the case because under the NLRC Manual on the
Execution of Judgment, Ando’s remedy should have been to file a third-party claim with the NLRC
Sheriff. Despite its ruling concerning its lack of jurisdiction, the RTC rendered judgment on the merits
of the case. The Court of Appeals (CA) affirmed the RTC decision.
ISSUE:
Whether or not the RTC has jurisdiction to restrain the implementation of the writ of
execution issued by the LA.
RULING:
NO. The Court has long recognized that regular courts have no jurisdiction to hear and decide
questions which arise from and are incidental to the enforcement of decisions, orders, or awards
rendered in labor cases by appropriate officers and tribunals of the Department of Labor and
Employment. To hold otherwise is to sanction splitting of jurisdiction which is obnoxious to the
orderly administration of justice. Thus, it is, first and foremost, the NLRC Manual on the Execution of
Judgment that governs any question on the execution of a judgment of that body. Ando need not look
further than that. The Rules of Court apply only by analogy or in a suppletory character.
On the other hand, the NLRC Manual on the Execution of Judgment deals specifically with
third-party claims in cases brought before that body. It defines a third-party claim as one where a
person, not a party to the case, asserts title to or right to the possession of the property levied upon. It
also sets out the procedure for the filing of a third-party claim. There is no doubt in our mind that
Ando’s complaint is a third- party claim within the cognizance of the NLRC. Ando may indeed be
considered a third party in relation to the property subject of the execution vis--vis the Labor Arbiters
decision. There is no question that the property belongs to petitioner and his wife, and not to the
corporation.
The subject matter of Ando’s complaint is the execution of the NLRC decision. Execution is an
essential part of the proceedings before the NLRC. Jurisdiction, once acquired, continues until the
case is finally terminated, and there can be no end to the controversy without the full and proper
implementation of the commissions directives. That said, however, we resolve to put an end to the
controversy right now, considering the length of time that has passed since the levy on the property
was made. Ando claims that the property sought to be levied does not belong to PACSI, the judgment
debtor, but to him and his wife. Since he was sued in a representative capacity, and not in his personal
capacity, the property could not be made to answer for the judgment obligation of the corporation.
The Transfer Certificate of Title (TCT) of the property bears out that, indeed, it belongs to Ando and
his wife.
Moreover, the power of the NLRC, or the courts, to execute its judgment extends only to
properties unquestionably belonging to the judgment debtor alone. A sheriff, therefore, has no
authority to attach the property of any person except that of the judgment debtor. Likewise, there is
no showing that the sheriff ever tried to execute on the properties of the corporation. In sum, while
Ando availed himself of the wrong remedy to vindicate his rights, nonetheless, justice demands that
this Court look beyond his procedural missteps and grant the petition.
APPEAL
BANAHAW BROADCASTING CORPORATION v. CAYETANO PACANA III, et al.

G.R. No. 171673, 30 May 2011, FIRST DIVISION (Leonardo-De Castro, J.)
As a general rule, the government and all the attached agencies with no legal personality
distinct from the former are exempt from posting appeal bonds, whereas government-owned and
controlled corporations (GOCCs) are not similarly exempted.
Several personnel of the DXWG -- a radio station in Iligan City owned by Banahaw
Broadcasting Corporation (BBC) which, in turn, is managed by Intercontinental Broadcasting
Corporation (IBC) -- filed complaints for illegal dismissal, unfair labor practice, and reimbursement
of unpaid Collective Bargaining Agreement (CBA) benefits against the radio station against IBC and
BBC. The Labor Arbiter (LA) rendered a decision in favor of the DXWG personnel. Both parties
appealed to the National Labor Relations Commission (NLRC). The NLRC vacated the decision of the
LA and remanded the case to the arbitration branch of origin on the ground that while the complaint
was filed against both IBC and BBC, only IBC was served with summons. Accordingly, the new LA
rendered a decision finding BBC liable for the same amount discussed in the first LA decision. Both
parties appealed once again to the NLRC.
BBC challenged the monetary award, and attached a Motion for the Recomputation of the
Monetary Award in order that the appeal bond may be reduced. The NLRC denied their motion and
ordered them to post the required bond within ten days from receipt of the Order. However, instead
of complying with its Order, the BBC filed a Motion for Reconsideration alleging that since it is wholly
owned by the Philippines, it need not post an appeal bond. The NLRC denied BBC's motion, and
dismissed BBC's appeal for non-perfection. The Court of Appeals (CA) rendered a decision denying
BBC's petition for certiorari, explaining that although owned by the government, it is a corporation
with a personality distinct from the Republic of the Philippines or any of its agencies or
instrumentalities; therefore, it cannot avail of its exemptions in the posting of an appeal bond.
ISSUE:
Whether BBC is exempt from posting an appeal bond.
RULING:
NO. As a general rule, the government and all the attached agencies with no legal personality
distinct from the former are exempt from posting appeal bonds, whereas government-owned and
controlled corporations (GOCCs) are not similarly exempted. However, when a GOCC becomes a
“government machinery to carry out a declared government policy,” it becomes similarly situated as
its majority stockholder as there is the assurance that the government will necessarily fund its
primary functions. Thus, a GOCC that is sued in relation to its governmental functions may be, under
appropriate circumstances, exempted from the payment of appeal fees.
In this case, BBC was organized as a private corporation, sequestered in the 1980s and the
ownership of which was subsequently transferred to the government in a compromise agreement.
Further, the Articles of Incorporation of BBC make it clear that its function is purely commercial or
proprietary and not governmental. As such, BBC cannot be deemed entitled to an exemption from the
posting of an appeal bond.
RODOLFO LUNA v. ALLADO CONSTRUCTION CO., INC., and/or RAMON ALLADO

The NLRC shall, in cases of perfected appeals, limit itself to reviewing those issues which are
raised on appeal. As a consequence thereof, any other issues which were not included in the appeal shall
become final and executory.
Rodolfo Luna (Luna) filed a complaint for illegal dismissal alleging that he was an employee
of Allado Construction Co., Inc. (Allado) having been a part of its construction pool of personnel. He
had continuously rendered services as a warehouseman and a timekeeper in every construction
project undertaken by Allado. Luna was given a travel order to proceed to Allado’s main office in
Davao City for reassignment. Upon arrival at the office , he was told by Allado’s personnel manager
to sign several sets of Contract of Project Employment. He refused to sign the said contracts. Because
of his refusal, he was not given a reassignment or any other work.
Allado on the other hand, alleged that Luna applied for a leave of absence which was granted.
Upon expiration of his leave, Luna was advised to report to the company’s project in Kablacan,
Sarangani Province. However, he refused to report to his new assignment and claimed instead that
he had been dismissed illegally.
Finding that Luna should be deemed to have resigned, the Labor Arbiter dismissed the
complaint for illegal dismissal but ordered Alladoto pay the amount of P18,000.00 by way of financial
assistance. Only Allado interposed an appeal with the National Labor Relations Commission (NLRC),
purely for the purpose of questioning the validity of the grant of financial assistance made by the
Labor Arbiter. The NLRC reversed the Decision of the Labor Arbiter and declared Allado guilty of
illegal dismissal. Allado elevated their cause to the Court of Appeals via a petition for certiorari under
Rule 65 of the Rules of Court to set aside the aforementioned NLRC issuances and to reinstate the
Labor Arbiter’s decision with the modification that the award of financial assistance be deleted. In its
Decision the Court of Appeals granted Allado’s petition. The Court of Appeals held that it was grave
abuse of discretion for the NLRC to rule on the issue of illegal dismissal when the only issue raised to
it on appeal was the propriety of the award of financial assistance. The Court of Appeals further ruled
that financial assistance may not be awarded in cases of voluntary resignation.
ISSUE:
1. Whether the NLRC has authority to review issues not brought before it for appeal.
2. Whether Luna is entitled to financial assistance.
RULING:
1. NO. The NLRC evidently went against its own rules of procedure when it passed upon the
issue of illegal dismissal although the question raised by respondents in their appeal was concerned
solely with the legality of the labor arbiters award of financial assistance despite the finding that
petitioner was lawfully terminated.
To reiterate, the clear import of the procedural rule is that the NLRC shall, in cases of
perfected appeals, limit itself to reviewing those issues which are raised on appeal. As a consequence
thereof, any other issues which were not included in the appeal shall become final and executory. We
are cognizant of the fact that Article 218(c) of the Labor Code grants the NLRC the authority to
correct, amend or waive any error, defect or irregularity whether in substance or in form in the
exercise of its appellate jurisdiction. However, a careful perusal of the body of jurisprudence wherein
we upheld the validity of the NLRCs invocation of that prerogative would reveal that the said cases
involved factual issues and circumstances materially dissimilar to the case at bar.
2. YES. There appears to be no reason why petitioner, who has served respondent corporation
for more than eight years without committing any infraction, cannot be extended the reasonable
financial assistance of P18,000.00 as awarded by the Labor Arbiter on equity considerations.
UNIVERSITY PLANS INCORPORATED v. BELINDA P. SOLANO, et al.

Posting of bond is indispensable to the perfection of an appeal in cases involving monetary

awards from the Decision of the Labor Arbiter. The bond requirement on appeal may be relaxed
considering that (1) there was substantial compliance with the Rules; (2) the surrounding facts and
circumstances constitute meritorious grounds to reduce the bond; and (3) the petitioner, at the very
least, exhibited its willingness and/or good faith by posting a partial bond during the reglementary
period.
Belinda P. Solano, et al. (Solano, et al.) filed before the Labor Arbiter complaints for illegal
dismissal, illegal deductions, overriding commissions, unfair labor practice, moral and exemplary
damages, and actual damages against University Plans Incorporated (University Plans). The Labor
Arbiter found University Plans guilty of illegal dismissal and ordered the reinstatement of Solano et
al. as well as the payment of their full backwages, proportionate 13thmonth pay, moral/exemplary
damages, and attorney’s fees. University Plans filed before the NLRC its Memorandum on Appeal as
well as a Motion to Reduce Bond. Simultaneous with the filing of said pleadings, it posted a cash bond
in the amount of P30,000.00. University Plans alleged that it was under receivership and that it
cannot dispose of its assets at such a short notice. Because of this, it could not post the required
bond. Nevertheless, it has P30,000.00 available for immediate disposition and thus prayed that said
amount be deemed sufficient to satisfy the required bond for the perfection of its appeal.
The NLRC denied Univresity Plans’ Motion to Reduce Bond and directed it to post an
additional appeal bond in the amount of P3,013,599.50 within an unextendible period of 10 days
from notice, otherwise the appeal shall be dismissed for non-perfection. The NLRC held that the
amount of the appeal bond is fixed by law pursuant to Article 223 of the Labor Code. In its Motion for
Reconsideration, University Plans insisted that the NLRC has the discretion to reduce the appeal bond
upon motion of appellant and on meritorious grounds. It argued that the fact that it was under
receivership and could not dispose of any or all of its assets without prior court approval are
meritorious grounds justifying the reduction of the appeal bond. The NLRC, however, denied the
motion for reconsideration.
On appeal to the CA, it held that the NLRC in meritorious cases and upon motion by the
appellant may reduce the amount of the bond. However, in order for the NLRC to exercise this
discretion, it is imperative for University Plans to show veritable proof that it is entitled to the
same. Since it failed to provide the NLRC with sufficient basis to determine its incapacity to post the
required appeal bond, the CA opined that the NLRCs denial of petitioners Motion to Reduce Bond was
justified.
ISSUE:
Whether the NLRC erred in denying the Motion to Reduce Bond.
RULING:
YES. Posting of bond is indispensable to the perfection of an appeal in cases involving

monetary awards from the Decision of the Labor Arbiter. Notably, however, under Section 6, Rule VI
of the NLRC’s Revised Rules of Procedure, the bond may be reduced albeit only on meritorious
grounds and upon posting of a partial bond in a reasonable amount in relation to the monetary
award. Suffice it to state that while said Rules allows the Commission to reduce the amount of the
bond, the exercise of the authority is not a matter of right on the part of the movant, but lies within
the sound discretion of the NLRC upon a showing of meritorious grounds.
Petitioner attached to its Motion to Reduce Bond the SEC Orders dated August 23, 1999 and
May 23, 2000. The Order of August 23, 1999 is a Cease and Desist Order which, among others,
prohibited the officers and agents of petitioner from withdrawing from its trust funds or from making
any disposition thereof and, ordered the freeze of all its assets and properties. From the said SEC
Orders, it is unmistakable that petitioner was under receivership. And from the tenor and contents
of said Orders, it is possible that petitioner has no liquid asset which it could use to post the required
amount of bond. Also, it is quite understandable that because of petitioners financial state, it cannot
raise the amount of more than P3 million within a period of 10 days from receipt of the Labor Arbiters
judgment.
However, the NLRC ignored petitioners’ allegations and instead remained adamant that since
the amount of bond is fixed by law, petitioner must post an additional bond of more than P3
million. This, to us, is an utter disregard of the provision of the Labor Code and of the NLRC Revised
Rules of Procedure allowing the reduction of bond in meritorious cases. While the NLRC tried to
correct this error in its March 21, 2003 Resolution by further explaining that it was not persuaded by
petitioners alleged incapability of posting the required amount of bond for failure to submit financial
statement, list of sources of income and other details with respect to the alleged receivership, we still
find the hasty denial of the motion to reduce bond not proper.
MIGUEL DELA PENA BARAIRO v. OFFICE OF THE PRESIDENT and MST MARINE SERVICES
(PHILS.), INC.
G.R. No. 189314, 15 June 2011, THIRD DIVISION (Carpio-Morales, J.)
Following settled jurisprudence, the proper remedy to question the decisions or orders of the
Secretary of Labor is via Petition for Certiorari under Rule 65, not via an appeal to the OP. Appeals to
the OP in labor cases have indeed been eliminated, except those involving national interest over which
the President may assume jurisdiction.
Miguel Barairo (Barairo) was hired by respondent MST Marine Services Phils. Inc., (MST) for
its principal, TSM International, Ltd., as Chief Mate of the vessel Maritina, for a contract period of six
months. He boarded the vessel and discharged his duties but was relieved ostensibly for transfer to
another vessel, Solar. Barairo was later to claim that he was not paid the promised stand-by fee in
lieu of salary that he was to receive while awaiting transfer to another vessel as in fact the transfer
never materialized. Subsequently, Barairo signed a new Contract of Employment for a six-month
deployment as Chief Mate in a newly-built Japanese vessel, M/T Haruna. He was paid a one-month
standby fee in connection with the Maritina contract. He boarded the M/T Haruna but he
disembarked a week later as MST claimed that his boarding of M/T Haruna was a sea trial which,
MST maintains, was priorly made known to him on a stand-by fee. MST soon informed petitioner that
he would be redeployed to the M/T Haruna but Barairo refused prompting MST to file a complaint for
breach of contract against him before the Philippine Overseas Employment Administration (POEA).
Barairo claimed, however, that he was placed on forced vacation when he was made to
disembark from the M/T Haruna, and that not wanting to experience a repetition of the previous
termination of his employment aboard the Maritina, he refused to be redeployed to the M/T Haruna.
The POEA Administrator Rosalinda D. Baldoz penalized Barairo with one year suspension from
overseas deployment upon a finding that his refusal to complete his contract aboard the
M/T Haruna constituted a breach thereof. On appeal, the Secretary of Labor, noting that it was
Barairo’s first offense, modified the POEA Order by shortening the period of suspension from one
year to six months. The Office of the President (OP), by Decision, dismissed Barairo’s appeal for lack
of jurisdiction. The OP held that appeals to it in labor cases, except those involving national interest,
have been eliminated.
ISSUE:
Whether Barairo properly appealed to the OP.
RULING:
NO. Following settled jurisprudence, the proper remedy to question the decisions or orders
of the Secretary of Labor is via Petition for Certiorari under Rule 65, not via an appeal to the OP. For
appeals to the OP in labor cases have indeed been eliminated, except those involving national interest
over which the President may assume jurisdiction. Petitioner’s appeal of the Secretary of Labors
Decision to the Office of the President did not toll the running of the period, hence, the assailed
Decisions of the Secretary of Labor are deemed to have attained finality.
At all events, on the merits, the petition just the same fails. As found by the POEA
Administrator and the Secretary of Labor, through Undersecretary Danilo P. Cruz, petitioners refusal
to board the M/T Haruna on November 30, 2004 constituted unjustified breach of his contract of
employment under Section 1 (A-2) Rule II, Part VI [sic] of the POEA Seabased Rules and
Regulations. That petitioner believed that respondent company violated his rights when the period
of his earlier Maritina contract was not followed and his stand-by fees were not fully paid did not
justify his refusal to abide by the valid and existing Harunacontract requiring him to serve aboard
M/T Haruna. For, as noted in the assailed DOLE Order, if petitioners rights has been violated as he
claims, he has various remedies under the contract which he did not avail of. Parenthetically, the
Undersecretary of Labor declared that the real reason [petitioner] refused to re-join Haruna on
November 30, 2004, is that he left the Philippines on November 29, 2004 to join MT Adriatiki, a vessel
of another manning agency, which declaration petitioner has not refuted.
SOCIAL LEGISLATION
Employee’s Compensation
GOVERNMENT SERVICE INSURANCE SYSTEM v. MANUEL P. BESITAN

Under the increased risk theory, there must be a reasonable proof that the employee’s working
condition increased his risk of contracting the disease, or that there is a connection between his work and the
cause of the disease. Only a reasonable proof of work-connection, not direct causal relation, however, is
required to establish compensability of a non-occupational disease.
Manuel Besitan (Besitan) was employed by the Central Bank of the Philippines (now Bangko
Sentral ng Pilipinas) in 1976 as a Bank Examiner. Subsequently, he was promoted as Bank Officer II
and eventually as Bank Officer III. In 2005, Besitan was diagnosed with End Stage Renal Disease
secondary to Chronic Glomerulonephritis and thus, had to undergo a kidney transplant at the
National Kidney and Transplant Institute (NKTI), for which he incurred medical expenses amounting
to P817,455.40. Believing that his working condition increased his risk of contracting the disease,
Besitan filed with the GSIS a claim for compensation benefits under Presidential Decree (PD) No. 626,
as amended. The GSIS, however, denied the claim. Besitan sought reconsideration but the GSIS
denied the same. Besitan elevated the matter to the ECC. The ECC issued a Decision affirming the
denial by the GSIS of his claim. On appeal, the CA reversed the ruling of the ECC. The CA ruled that
Besitan is entitled to compensation benefits because his ailment was aggravated by the nature of his
work, as evidenced by the Medical Certificate issued by Dr. Gregorio Suarez II, Bank Physician III of
the Bangko Sentral ng Pilipinas.
GSIS contends that Besitan’s ailment, Glomerulonephritis, is not an occupational disease;

hence, it is incumbent upon him to prove that the risk of contracting the said disease was increased
by his employment and working condition. Since he failed to show that there is a causal relationship
between his employment and his ailment, he cannot claim compensation benefits under PD No. 626,
as amended. GSIS also puts in issue the use of the word probably by the CA in its Decision which
proves that the CA was not definite of its findings. GSIS claims that awards of compensation must be
based on substantial evidence, not on presumptions or speculations.
ISSUE:
Whether Besitan is entitled to compensation benefits under PD No. 626, as amended

RULING:
YES. Corollarily, for the sickness or resulting disability or death to be compensable, the
claimant must prove either (1) that the employees sickness was the result of an occupational disease
listed under Annex A of the Amended Rules on Employees Compensation, or (2) that the risk of
contracting the disease was increased by his working conditions. Under the increased risk theory,
there must be a reasonable proof that the employees working condition increased his risk of
contracting the disease, or that there is a connection between his work and the cause of the
disease. Only a reasonable proof of work-connection, not direct causal relation, however, is required
to establish compensability of a non-occupational disease. Probability, and not certainty, is the
yardstick in compensation proceedings; thus, any doubt should be interpreted in favor of the
employees for whom social legislations, like PD No. 626, were enacted. Moreover, direct and clear
evidence, is not necessary to prove a claim. Strict rules of evidence do not apply as PD No. 626 only
requires substantial evidence or such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.
In this case, since Besitan’s ailment, End Stage Renal Disease secondary to Chronic
Glomerulonephritis is not among those listed under Annex A, of the Amended Rules on Employees
Compensation, he needs to show by substantial evidence that his risk of contracting the disease was
increased by his working condition. After a careful study of the instant case, we find that Besitan has
sufficiently proved that his working condition increased his risk of contracting Glomerulonephritis,
which according to GSIS may be caused by bacterial, viral, and parasitic infection (i.e. Typhoid fever,
Syphilis, Leptospirosis, Toxoplasmosis, Varicella, Mumps, Measles, Schistosomiasis, Hepatitis B and
C infection, etc.). When Besitan entered the government service in 1976, he was given a clean bill of
health. In 2005, he was diagnosed with End Stage Renal Disease secondary to Chronic
Glomerulonephritis. It would appear therefore that the nature of his work could have increased his
risk of contracting the disease. His frequent travels to remote areas in the country could have exposed
him to certain bacterial, viral, and parasitic infection, which in turn could have caused his
disease. Delaying his urination during his long trips to the provinces could have also increased his
risk of contracting his disease. As a matter of fact, even the Bank Physician of Bangko Sentral ng
Pilipinas, Dr. Gregorio Suarez II, agreed that Besitan’s working condition could have contributed to
the weakening of his kidneys, which could have caused his disease.
Permanent Disability
CARMELITO N. VALENZONA v. FAIR SHIPPING CORPORATION and/or SEJIN LINES COMPANY

LIMITED
G.R. No. 176884, 19 October 2011, FIRST DIVISION (Del Castillo, J.)
Permanent disability refers to the inability of a worker to perform his job for more than 120
days, regardless of whether he loses the use of any part of his body. What determines petitioners
entitlement to permanent disability benefits is his inability to work for more than 120 days.
On the other hand, permanent total disability means disablement of an employee to earn wages
in the same kind of work, or work of similar nature that he was trained for or accustomed to perform,
or any kind of work, which a person of his mentality and attainment could do. It does not mean absolute
helplessness.
Fair Shipping Corporation, for and on behalf of its principal, Sejin Lines Company Limited,
hired Valenzona as 2nd Assistant Engineer aboard its vessel M/V Morelos for nine months. While
aboard the vessel in September 2001, Valenzona complained of chest pain. He was thus brought to a
hospital in Mexico where he was confined up to October 6, 2001 and diagnosed with hypertensive
crisis, high blood pressure.
Upon his return to the Philippines on October 8, 2002, Valenzona was examined by Dr.
Nicomedes Cruz (Dr. Cruz), the company-designated physician who diagnosed his illness as
hypertension. Dr. Cruz continuously treated Valenzona for six months. In April 2002, however,
Valenzona consulted another doctor at the Jose Reyes Memorial Medical Center who diagnosed him
with Hypertensive Cardiovascular Disease. On April 25, 2002, Dr. Cruz issued a certification declaring
Valenzona as fit to work.
Unconvinced, in April 2002, Valenzona consulted a doctor at the Philippine Heart Center who
diagnosed him with Ischemic heart disease, Hypertensive cardiovascular disease and congestive
heart failure and also declared him unfit to work in any capacity. Hence, Valenzona filed a complaint
for recovery of disability benefits, sickness allowance, attorney's fees and moral damages. The Labor
Arbiter (LA) ruled that Valenzona is not entitled to disability benefits because he was declared fit to
work by the company physician. The National Labor Relations Commission (NLRC) and the Court of
Appeals (CA) affirmed.
ISSUES:
Whether or not Valenzona is entitled to receive permanent disability benefits.
RULING:
YES. Valenzona was medically repatriated to the Philippines on October 8, 2001. However, it
was only on April 25, 2002 or after a lapse of 199 days that Dr. Cruz issued a certification declaring
him fit to work. Thus, we declare herein, just as we pronounced in Quitoriano v. Jebsens Maritime,
Inc., that Valenzona’s disability is considered permanent and total because the fit to work
certification was issued by Dr. Cruz only on April 25, 2002, or more than 120 days after he was
medically repatriated on October 8, 2001.
It does not matter that the company-designated physician assessed Valenzona as fit to
work. It is undisputed that from the time Valenzona was repatriated on October 8, 2001, he was
unable to work for more than 120 days as he was only certified fit to work on April 25, 2002.
Consequently, Valenzona's disability is considered permanent and total.
FIL-STAR MARITIME CORPORATION, CAPTAIN VICTORIO S. MIGALLOS and

GRANDSLAM ENTERPRISE CORPORATION v. HANZIEL O. ROSETE
A total disability does not require that the employee be completely disabled, or totally paralyzed.
What is necessary is that the injury must be such that the employee cannot pursue his or her usual work
and earn from it. On the other hand, a total disability is considered permanent if it lasts continuously for
more than 120 days.
Fil-Star Maritime Corporation (Fil-Star), the local manning agency of co-petitioner Grandslam
Enterprise Corporation (Grandslam), hired Hanziel O. Rosete (Rosete) as third officer on board the
ocean-going vessel M/V Ansac Asia. After Rosete finished his contract, Fil-Star and Grandslam re-
hired him to work as second officer on their vessel. When Rosete underwent a pre-employment
medical examination (PEME) with First Medical Team Health Care Specialist Group, the company
accredited physician, he was pronounced fit to work. A little over a month from his embarkation,
Rosete experienced an abrupt blurring of his left eye. He was diagnosed with Central Retinal Vein
Occlusion and immediately underwent three rounds of laser surgery. Subsequently, he was
repatriated to the Philippines. Upon arrival in Manila, respondent went to the Metropolitan
Hospital but could not get immediate treatment. He experienced severe pain in his left eye so he
insisted that he be admitted to the hospital and underwent another series of laser surgery.
Dr. Antonio Say declared Rosete’s left eye to be legally blind with poor possibility of recovery.
Fil-Star and Grandslam denied his claim for permanent total disability and only rated his incapacity
as Grade 7. Rosete stressed that, under their Collective Bargaining Agreement (CBA), he should be
considered legally blind meriting entitlement to permanent total disability benefits in the sum of
US$105,000.00 for being unable to perform his job for more than 120 days from his repatriation.
Rosete filed a complaint against Fil-Star, Capt. Victorio S. Migallos and Grandslam for disability
benefits, damages and attorneys fees. Fil-Star and Grandslam argued that Rosete was not qualified
for disability benefits, damages and attorneys fees because his illness was not an occupational
disease or work-related.
The Labor Arbiter ruled in favor of Rosete. The NLRC modified the LA’s Decision and ruled
that the grant of US$105,000.00 based on the provisions of the CBA had no legal basis because
disability benefits under Article 28 thereon would refer only to permanent disability resulting from
accident while in employment. On appeal to the CA, it reversed the NLRCs decision. The CA held that
although respondents Central Retinal Vein Occlusion was not listed as an occupational disease, he
successfully established a causal connection from his work as a seaman to his illness.
ISSUES:
1. Whether Rosete is entitled to claim total permanent disability benefits.

2. Whether Rosete is entitled to permanent total disability benefits based on the CBA.
RULING:
1. YES. Although Central Retinal Vein Occlusion is not listed as one of the occupational
diseases under Section 32-A of the 2000 Amended Terms of POEA-SEC, the resulting disability which
is loss of sight of one eye, is specifically mentioned in Section 32 thereof (Schedule of Disability or
Impediment for Injuries Suffered and Diseases Including Occupational Diseases or Illness
Contracted).More importantly, Section 20 (B), paragraph (4) states that those illnesses not listed in
Section 32 of this Contract are disputably presumed as work-related. It should be noted that the
company-designated physician assessed the loss of respondents left eye as a permanent partial
disability while respondents own physician indicated his disability as Grade 7. The Court is more
inclined to rule, however, that respondent is suffering from a permanent total disability as he was unable to
return to his job that he was trained to do for more than one hundred twenty days already.
A total disability does not require that the employee be completely disabled, or totally
paralyzed. What is necessary is that the injury must be such that the employee cannot pursue his or
her usual work and earn from it. On the other hand, a total disability is considered permanent if it
lasts continuously for more than 120 days. What is crucial is whether the employee who suffers from
disability could still perform his work notwithstanding the disability he incurred. Evidently, respondent was
not able to return to his job as a seafarer after his left eye was declared legally blind. Records show that the
petitioners did not give him a new overseas assignment after his disability. This only shows that his disability
effectively barred his chances to be deployed abroad as an officer of an ocean-going vessel.
2. NO. The Court holds that respondent is entitled to claim permanent total disability benefits
based on his POEA-SEC and not based on their CBA as earlier ruled by the L.A. and later affirmed by
the CA. The CBA provisions on disability are not applicable to respondents case because Article 28
thereon specifically refers to disability sustained after an accident. Respondent failed to show that
the blurring of his left eye was caused by an accident on board the ship. Thus, Article 28 of the CBA
cannot be used to compute his disability benefits. Accordingly, what should govern the computation
of his disability benefits is the POEA-SEC incorporating the 2000 POEA Amended Standard Terms
and Conditions.
Disability Benefits
COASTAL SAFEWAY MARINE SERVICES, INC. v. ELMER T. ESGUERRA

It is mandatory that a seafarer be examined by a company-designated physician within three

days from his repatriation. Failure to comply with this mandatory reporting requirement without
justifiable cause shall result in forfeiture of the right to claim the compensation and disability benefits
provided under the POEA-SEC.
Elmer Esguerra was hired by Coastal Safeway Marine Services, Inc. (CSMSI) as Second Officer
aboard the vessel M/V Gondwana. During his employment, Esguerra complained of back and chest
pains. He was examined at the Jebel Ali Medical Centre where he was declared us not fit for work
until a complete cardiac evaluation is done. His tests showed normal results but despite these,
Esguerra insisted that he be allowed to go home. After his arrival in the Philippines, he went to he
Philippine Heart Center (PHC), the Philippine Orthopedic Hospital (POH) and the Philippine General
Hospital (PGH) for medical evaluation and treatment. Esguerra further underwent diagnostic tests
and was prescribed various medications at the PGH for chronic stable angina.
Esguerra filed a complaint against CSMSI for reimbursement of medical expenses, sickness
allowance, permanent disability benefits, damages and attorney’s fees. Subsequent to the filing of
said complaint, both Dr. Vicaldo and Dr. Saguin issued medical certifications stating that Esguerra
was unfit to work. The Labor Arbiter and the National Labor Relations Commission (NLRC) ruled in
favor of CSMSI. The decision of the NLRC, however, was reversed by the Court of Appeals.
ISSUE:
Whether or not Esguerra is entitled to sickness/disability benefits despite his non-

compliance with the post-employment medical examination as required in POEA-SEC.
RULING:
NO. Viewed in light of the fact that Esguerra’s contract of employment was executed on 9 May
2003, CSMSI correctly faults the CA for applying Philippine Overseas Employment Administration
(POEA) Memorandum Circular No. 055-96 instead of the 2000 Philippine Overseas Employment
Administration Standard Employment Contract Governing the Employment of Filipino Seafarers On-
Board Ocean-Going Vessels (POEA-SEC) which took effect on 25 June 2000.
Anent a seafarer’s entitlement to compensation and benefits for injury and illness is Section 20-B (3)
thereof. The foregoing provision has been interpreted to mean that it is the company-designated
physician who is entrusted with the task of assessing the seaman's disability, whether total or partial,
due to either injury or illness, during the term of the latter's employment. Concededly, this does not
mean that the assessment of said physician is final, binding or conclusive on the claimant, the labor
tribunal or the courts. Should he be so minded, the seafarer has the prerogative to request a second
opinion and to consult a physician of his choice regarding his ailment or injury, in which case the
medical report issued by the latter shall be evaluated by the labor tribunal and the court, based on
its inherent merit. For the seaman’s claim to prosper, however, it is mandatory that he should be
examined by a company-designated physician within three days from his repatriation. Failure to
comply with this mandatory reporting requirement without justifiable cause shall result in forfeiture
of the right to claim the compensation and disability benefits provided under the POEA-SEC.
Esguerra did not present any evidence to prove justification for his inability to submit himself
to a post-employment medical examination by a company-designated physician. If a written notice is
required of a seafarer who is physically incapacitated for purposes of compliance with said
requirement, we fail to see why a more tangible proof should not likewise be expected of Esguerra
who, after his arrival on 7 July 2003, appears to have been well enough to consult with Dr. Vicaldo
and Dr. Saguin on 9 July 2003.
Quite significantly, Esguerra also filed his complaint on 16 July 2003 or even before his
impediment rating was definitively assessed by either Dr. Vicaldo or Dr. Saguin. The record further
shows that, by and of themselves, the medical certifications upon which Esguerra anchored his claims
for disability benefits and sickness allowance were not supported by such diagnostic tests and/or
procedures as would adequately refute the normal results of those administered to him at the Jebel
Ali Medical Centre. Working on a vague diagnosis of lower back problem, Dr. Saguin appears to have
caused Esguerra to undergo physical therapy and prescribed him pain medications similar to those
he was already given abroad. While Dr. Vicaldo also issued the 18 July 2003 medical certification,
diagnosing Esguerra to be suffering from Coronary Artery Disease, Stable Angina Pectoris, his
justification for the assessment of an Impediment Grade VII (41.8%) was merely anchored on general
impressions.
GILBERT QUIZORA vs. DENHOLM CREW MANAGEMENT (PHILIPPINES), INC.

G.R. No. 185412, 16 November 2011, THIRD DIVISION, (Mendoza, J)
In order to be entitled to to disability beneifts, it must be shown that there is a causal connection
between the seafarers illness or injury and the work for which he had been contracted.
Denholm Crew Management, a domestic manning agency that supplied manpower to Denklav
Maritime Services, Ltd. a foreign maritime corporation, hired the services of Gilbert Quizora. After
the expiration of his contract with MV Leopard, petitioner was lined up for another assignment to a
different vessel, but Quiroza was later disqualified for employment and declared unfit for sea duty
after he was medically diagnosed to be suffering from varicose veins.
Subsequently, Quiroza demanded from respondent company the payment of disability

benefits, separation pay and reimbursement of medical expenses. His demands, however, were
denied. He then filed with the LA a complaint for payment of disability benefits, medical expenses,
separation pay, damages, and attorney’s fees. After due hearing, the LA rendered a decision
dismissing petitioners complaint for lack of merit. On appeal, the NKRC reversed the decision of the
LA. The CA rendered a decision setting aside the NLRC Resolution and reinstating the LA Decision.
ISSUE:
Whether or not Quiroza is entitled to disability benefits
RULING:
NO. Considering that petitioner executed an overseas employment contract with respondent
company in November 1999, the 1996 POEA-SEC should govern. For disability to be compensable
under Section 20 (B) of the 2000 POEA-SEC, two elements must concur: (1) the injury or illness must
be work-related; and (2) the work-related injury or illness must have existed during the term of the
seafarers employment contract. In other words, to be entitled to compensation and benefits under
this provision, it is not sufficient to establish that the seafarers illness or injury has rendered him
permanently or partially disabled; it must also be shown that there is a causal connection between
the seafarers illness or injury and the work for which he had been contracted.
Unfortunately for Quiroza failed to prove that his varicose veins arose out of his employment
with respondent company. Except for his bare allegation that it was work-related, he did not narrate
in detail the nature of his work as a messman aboard Denklav’s vessels. He likewise failed to
particularly describe his working conditions while on sea duty. He also failed to specifically state how
he contracted or developed varicose veins while on sea duty and how and why his working conditions
aggravated it. Neither did he present any expert medical opinion regarding the cause of his varicose
veins. No written document whatsoever was presented that would clearly validate his claim or
visibly demonstrate that the working conditions on board the vessels he served increased the risk of
acquiring varicose veins.
Death Benefits
MARITIME FACTORS INC. v. BIENVENIDO R. HINDANG

The employer may be exempt from liability for the payment of death benefits if it can successfully
prove that the seaman's death was caused by an injury directly attributable to his deliberate or willful
act.
Maritime Factors, Inc., a domestic manning agency, for and in behalf of its foreign principal
Bahrain Marine Contracting/Panama, engaged the services of Danilo R. Hindang to work on board
the M/T Reya for 12 months. In July 1994, while within the territorial jurisdiction of the Kingdom of
Saudi Arabia and on board the vessel, the crew found Danilo's body, hanging by a strap on his neck
in a kneeling position, inside the locker of his cabin. They turned over Danilo's body to the Saudi
police authorities, who then brought the body to a medical examiner. The autopsy concluded that
Danilo committed suicide by hanging himself. Danilo's remains were repatriated to the Philippines
where an autopsy was requested by Danilo's family. The National Bureau of Investigation (NBI) and
concluded that the cause of Danilo's death was Asphyxia by strangulation, which meant that
somebody caused his death based on his autopsy findings.
In August 1994, respondent Bienvenido Hindang, Danilo’s brother, filed for death
compensation benefits pursuant to the POEA Standard Employment Contract Governing the
Employment of All Filipino Seamen on Board Ocean-Going Vessels. Maritime Factors claimed that
based on Dr. Hameed's medical jurisprudence report, Danilo committed suicide by hanging himself;
thus, his death is not compensable. The Labor Arbiter (LA) ordered Maritime Factors to pay Danilo’s
death benefits, giving credence to NBI’s findings and not that of Dr. Hameeds, which was only
presented as a photocopy of a fax transimission. The National Labor Relations Commission (NLRC)
and the Court of Appeals (CA) affirmed.
ISSUES:
Whether or not Danilo’s death is compensable.
RULING:
NO. We give credence to Dr. Hameeds medical report establishing that Danilo committed
suicide by hanging himself. Dr. Hameed conducted the autopsy on Danilo's remains immediately after
the latter's death. He saw first-hand the condition of Danilo's body, which upon his examination led
him to conclude that Danilo died by hanging himself. His report was comprehensive and more
detailed. He, likewise, noted that there were no signs of violence or resistance, or any external injuries
except a very slight and artificial injury of nearly 5 cms among the toes of Danilo's right leg.
In order to avail of death benefits, the death of the employee should occur during the
effectivity of the employment contract. The death of a seaman during the term of employment makes
the employer liable to his heirs for death compensation benefits. This rule, however, is not absolute.
The employer may be exempt from liability if it can successfully prove that the seaman's death was
caused by an injury directly attributable to his deliberate or willful act. Clearly, respondent's
entitlement to any death benefit depends on whether petitioner's evidence suffices to prove that
Danilo committed suicide, and the burden of proof rests on petitioner. Petitioner was able to prove
that Danilo's death was attributable to his deliberate act of killing himself by committing suicide.
State Insurance Fund
GOVERNMENT SERVICE INSURANCE SYSTEM v. JUM ANGEL

G.R. No. 166863, 20 July 2011, SECOND DIVISION (Perez, J.)
Article 172 of Presidential Decree No. 626 provides that State Insurance Fund shall be liable for
compensation to employee or his dependents except when the disability or death was occasioned by the
employees intoxication, willful intention to injure or kill himself or another, notorious negligence or
otherwise provided under the title.
Sgt. Angel was in active service until his death. Allegedly, Sgt. Angel was fetched/ invited form
Group of the Philippine Army to shed light on his alleged involvement in a pilferage/ gunrunning case
being investigated by Philippine Army. On the same day, he was placed inside a detention cell. On the
following day, the lifeless body of Sgt. Angel was found hanging inside his cell with an electric cord
tied around his neck. According to the autopsy report, the cause of death was asphyxia by
strangulation. Jum Angel (Jum), wife of Sgt. Angel, filed complaint before PNP Criminal Investigation
Command alleging that her husband was murdered. Upon investigation, the Provost Marshal
reported that Sgt. Angel died under suspicious circumstance in line of duty. The Judge Advocate
declared the line of duty status in favor of Sgt. Angel. With this, Jum filed a claim for death benefits
with Government Service Insurance System (GSIS) which was denied by the latter since the death did
not arise out and in the course of employment. On appeal before the Employee Compensation
Commission (ECC), the ECC likewise denied the claim for want of merit. It stressed that for injury and
resulting disability to be compensable, the injury must be the result of accident arising out and in the
course of employment. The Court of Appeals (CA) reversed the ECC Ruling. CA pointed out that a
soldier on active duty is really on a 24 hrs a day official duty status except when he is on vacation
leave status.
ISSUE:
Whether or not CA erred in disregarding ECC ruling that for injury and resulting death to be
compensable, it must be the result of accident arising out of and in the course of employment
RULING:
YES. Injury and resulting death, to be compensable, must be the result of an employment
accident satisfying all of the following: a) employee must have been injured at the place where his
work requires him to be; b) employee must have been performing his official functions; and c) if the
injury is sustained elsewhere, the employee must have been executing an order for the employer. The
requirement that the injury must arise out of and in the course of employment proceeds from the
limiting premise that the injury must be the result of an accident. It is an event that takes place
without one’s foresight or expectation. It happens without any human agency. In relation to this,
Article 172 of Presidential Decree No. 626 provides for limitation of liability of the State Insurance
fund.
In the case at bar, the death of Sgt. Angel did not result from an accident which is compensable
under PD. No. 626. It was on the contrary occasioned by an intentional or designed act which removes
the resulting death from the coverage of the State Insurance Fund. There was no evidence that Sgt.
Angel did not take his own life considering the fact that he was found hanging inside the cell. The
deceased was not performing his official duties at he time of accident. He was being investigated
regarding his alleged involvement on a gunrunning case when he was found dead in his cell, an
activity which is foreign and unrelated to his employment as a soldier. Thus, the protective mantle of
the law cannot be extended to him. The issuance declaring death in line of duty status of Sgt. Angel
may not be used as basis for the finding that the widow of Sgt. Angel is entitled to compensation. The
declaration is not equivalent to a finding that the death resulted from an accident and was not
occasioned by Sgt. Angel’s willful intention to kill himself.
AGRARIAN REFORM
JULIAN LEBURDO and REYNALDO LEBRUDO v. REMEDIOS LOYOLA

G.R. No. 181370, 9 March 2011, SECOND DIVISION (Carpio, J.)
Under section 27 of the Comprehensive Agrarian Reform Law, lands acquired by beneficiaries
under the act may not be sold, transferred, or conveyed except through hereditary succession, to the
government, or to the LBP , or other qualified beneficiaries for a period of 10 years.
Remedios Loyola (Loyola) was awarded by the Department of Agrarian Reform (DAR) under
the Comprehensive Agrarian Reform Law. The lot was covered by Certificate of Land Ownership
(CLOA). Julian Lebu4rdo (Lebrudo), now deceased and represented by his son, Reynaldo Lebrudo,
filed with the Provincial Agrarian Reform Adjudicator (PARAD) an action for cancellation of
TCT/CLOA in the name of Loyola and issuance of another for the 1/2 portion of the lot in
Lebrudo’sfavor. PARAD dismissed the case without prejudice. Lebrudo re-filed the same action. He
alleged that he was approached by Loyola to redeem the lot which was mortgaged. Thereafter, Loyola
again sought help of Lebrudo in obtaining title under her name by paying all the expenses for the
transfer of title. In exchange, Loyola promised to give Lebrudo 1/2 portion of the lot. Loyola allegedly
executed a Sinumpaang Salaysay committing herself to remove the house constructed on the half
portion of the lot. When Lebrudo asked Loyola to comply, the latter refused. For her part, Loyola
denied promising the half portion to Lebrudo and due execution of Sinumpaang Salaysay. PARAD
decided the case in favor Lebrudo. On motion for reconsideration, DARAB denied the motion filed by
Lebrudo. On review, the Court of Appeals (CA) affirmed DARAB decision.
ISSUE:
Whether or not Lebrudo is entitled to half portion of the lot covered by CARP on the basis of
waiver and transfer of rights embodied in Sinumpaang Salaysay
RULING:
NO. Under section 27 of the law, lands acquired by beneficiaries under the act may not be
sold, transferred, or conveyed except through hereditary succession, to the government, or to the
LBP , or other qualified beneficiaries for a period of 10 years. During the prohibitory 10-year period,
any sale or transfer of land reform rights is void, except as allowed by law. In the case at bar, Lebrudo
insisted that he is entitled to half portion of lot awarded to Loyola under CARP. His assertion must fail
because the law expressly prohibits any sale or transfer within 10 years from the the grant by the
DAR. Also, Lebrudo asserted that he is a qualified farmer beneficiary entitled to the lot. The
qualifications for such are: a) must be landless; b) Filipino citizen; c) actual occupant or tiller; and d)
has the ability to cultivate and make lands productive. Lebrudo was not landless according to the
records presented and he was not the actual occupant of the lot, buy Loyola and her family. The law
provides for an exception but Lebrudo does not fall within any of them. Thus, the waiver and transfer
of land reform rights under the Sinumpaang Salaysay is void for falliing within under the 10-year
prohibitory period specified under CARP.
MILESTONE FARMS, INC. v. OFFICE OF THE PRESIDENT

G.R. NO. 182332, 23 FEBRURY 2011, SECOND DIVISION, (NACHURA, J.)
Livestock farms are excluded in the coverage of CARP.
Milestone Farms, Inc. was incorporated with the Securities and Exchange Commission on
January 8, 1960. Among its pertinent secondary purposes includes among others “to engage in the
raising of cattle, pigs, and other livestock.” On June 10, 1988, a new agrarian reform law, Republic
Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law took effect, which
included the raising of livestock, poultry, and swine in its coverage. However, on December 4, 1990,
this Court, sitting en banc, ruled in Luz Farms v. DAR Secretary that agricultural lands devoted to
livestock, poultry, and/or swine raising are excluded from the Comprehensive Agrarian Reform
Program.
Thus, in May 1993, Milestone Farms applied for the exemption/exclusion of its 316.0422-
hectare property. Acting on the said application, the DARs Land Use Conversion and Exemption
Committee (LUCEC) of Region IV conducted an ocular inspection on Milestone Farm’s property and
arrived at the following findings: “that the area being applied for exclusion is far below the required
or ideal area which is 563 hectares for the total livestock population “ In the meantime, R.A. No. 6657
was amended by R.A. No. 7881, which was approved on February 20, 1995. Private agricultural lands
devoted to livestock, poultry, and swine raising were excluded from the coverage of the CARL.
The rulings as to the exemption changes from the DAR up to the RTC. When the case reached
the CA, the latter primarily ruled in favor of Milestone in exempting the entire property from the
coverage of CARP. However, six months earlier, without the knowledge of the CA – as the parties did
not inform the appellate court – then DAR Secretary Villa issued DAR conversion order granting
Milestone Farm’s application to convert portions of the 316.0422-hectare property from agricultural
to residential and golf courses use. The portions converted was with a total area of 153.3049
hectares. With this Conversion Order, the area of the property subject of the controversy was
effectively reduced to 162.7373 hectares. With the CA now made aware of these developments,
particularly Secretary Villa’s Conversion Order, CA had to acknowledge that the property subject of
the controversy would now be limited to the remaining 162.7373 hectares. CA, in its amended
decision, states that the subject landholding from the coverage of CARP is hereby lifted, and the
162.7373 hectare-agricultural portion thereof is hereby declared covered by the CARP.
ISSUE:
Whether or not Milestone’s property should be exempted from the coverage of CARP.
RULING:
NO. The deliberations of the 1987 Constitutional Commission show a clear intent to exclude,
inter alia, all lands exclusively devoted to livestock, swine and poultry-raising. The Court clarified in
the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall
within the definition of agriculture or agricultural activity. The raising of livestock, swine and poultry
is different from crop or tree farming. It is an industrial, not an agricultural, activity. A great portion
of the investment in this enterprise is in the form of industrial fixed assets, such as: animal housing
structures and facilities, drainage, waterers and blowers, feedmill with grinders, mixers, conveyors,
exhausts and generators, extensive warehousing facilities for feeds and other supplies, anti-pollution
equipment like bio-gas and digester plants augmented by lagoons and concrete ponds, deepwells,
elevated water tanks, pumphouses, sprayers, and other technological appurtenances. However, as
correctly held by the OP, the CA correctly held that the subject property is not exempt from the
coverage of the CARP, as substantial pieces of evidence show that the said property is not exclusively
devoted to livestock, swine, and/or poultry raising. In fact, we denied a similar petition for exemption
and/or exclusion, by according respect to the CAs factual findings and its reliance on the findings of
the DAR and the OP that: “The subject parcels of land were not directly, actually, and exclusively used
for pasture.”
Further, Milestone Farm’s admission that, since 2001, it leased another ranch for its own
livestock is fatal to its cause. While Milestone Farm’s advances a defense that it leased this ranch
because the occupants of the subject property harmed its cattle, like the CA, we find it surprising that
not even a single police and/or barangay report was filed by Milestone Farm’s to amplify its
indignation over these alleged illegal acts. Moreover, we accord respect to the CAs keen observation
that the assailed MARO reports and the Investigating Teams Report do not actually contradict one
another, finding that the 43 cows, while owned by Milestone Farm’s, were actually pastured outside
the subject property.
LAND BANK OF THE PHILIPPINES v. DEPARTMENT OF AGRARIAN REFORM and METRACO
TELE-HYGIENIC SERVICES CORPORATION
G.R. No. 171840, 4 April 2011, THIRD DIVISION (Villarama, Jr., J.)
The taking of private lands under the agrarian reform program partakes of the nature of an
expropriation proceeding. In a number of cases, we have stated that just compensation in expropriation
proceedings represents the full and fair equivalent of the property taken from its owner by the
expropriator. The measure is not the takers gain, but the owners loss. AND To compensate is to render
something which is equal in value to that taken or received.
Private respondent Metraco Tele-Hygienic Services Corporation (METRACO) is the

registered owner of three parcels of agricultural land located at San Antonio, Ramon, Isabela. The
lands are fully irrigated by the National Irrigation Administration (NIA) and planted with rice.
METRACO voluntarily offered to sell said lands under the provisions of Republic Act (R.A.) No. 6657
or the Comprehensive Agrarian Reform Law (CARL) of 1988. METRACO’s assessment
was P300,000.00 per hectare. Their offer was referred to petitioner Land Bank of the Philippines
(LBP) for valuation. Since METRACO rejected the valuation made by LBP, the latter deposited the
amount of compensation, which the former accepted without prejudice to reevaluation and eventual
payment of just compensation due for its property. METRACO then went to the Department of
Agrarian Reform Adjudication Board (DARAB)-Region 02. The DAR found untenable LBP’s position
that the basis of valuation should be the guidelines issued under DAR Administrative Order (AO) No.
5, series of 1998 and findings of the ocular inspection. It said that to do so would contravene the
Supreme Court’s declaration in Land Bank of the Philippines v. Court of Appeals that any formula or
guidelines promulgated by the bank is a violation of due process of the Constitution.
When the DAR denied its motion for reconsideration, LBP instituted before the Special
Agrarian Court (SAC) a case for determination of just compensation. During the trial, the parties
presented their witnesses and documentary evidence. In its decision, the SAC recomputed the
compensation fixed by LBP by using P9.00 as selling price of palay per kg. based on the September
25, 2001 Certification by the National Food Authority (NFA) that the government support price
for palay is P10.00 per kg. (March-August) and P9.00 per kg. (September-February). LBP moved for
reconsideration arguing that the basis of selling price of palay used by the court and acquisition of
the road and canal were in violation of DAR AO No. 05, series of 1998. The SAC, however, denied the
motion. On appeal, the CA sustained the SAC’s computation.
ISSUE:
Whether the SAC’s computation of just compensation is correct.
RULING:
NO. As clearly stated in DAR AO No. 5, the Selling Price for purposes of computing the
Capitalized Net Income (CNI), must be the average of the latest available 12-months selling prices prior
to the date of receipt of the claim folder by LBP, to be secured from the DA, Bureau of Agricultural
Statistics or other appropriate regulatory bodies. Thus, the selling price of P9.00 submitted by private
respondent sourced from the NFA (March-August and September-February without indicating the
year) and private buyer (March and October 2001) cannot be used as it was not the average obtained
within the period referred to in DAR AO No. 5 (July 2000 to May 2001). In Land Bank of the Philippines
v. Celada that the DAR was tasked to issue the rules and regulations to carry out the details of Section
17 of R.A. No. 6657. It can be safely presumed that the fluctuations in the selling price of palay were
already taken into consideration since only the average of these available prices within the 12
months prior to the receipt of the CF, will be used in computing the CNI. Hence, the SAC and CA clearly
erred in completely disregarding the data provided by the Municipal Agrarian Reform Office simply
because it contained a notation that the figures indicated for two months (October and November
2000) were not normal due to typhoons.
On the exclusion of the NIA irrigation canal and road, we find untenable petitioners argument
that said portions do not form part of the compensable area. It is true that Item II F of DAR AO No. 5
provides that those improvements introduced by the government, farmer-beneficiaries and other
third parties, shall not be paid. However, as correctly ruled by the CA, what is being compensated is
not the cost or value of the improvements introduced by the government but the value of the whole
land taken under the CARP law. This does not mean that those portions are being separately valued
as claimed by petitioner. Moreover, compensating the land upon which those improvements were
built is consistent with the principle that the equitable distribution and ownership of land sought to
be achieved through CARP is undertaken with due regard to the rights of landowners to just
compensation. Petitioners interpretation of Item II.F of DAR AO No. 5 would only lead to absurd and
unjust consequences for the landowner whose landholding a substantial portion thereof -- is not
being covered by the CARP and yet, the landowner is deprived of its use while the farmer-
beneficiaries benefit from the present improvements (irrigation canal and road) on the property
taken.
APO FRUITS CORPORATION and HIJO PLANTATION, INC. v. LAND BANK OF THE PHILIPPINES
G. R. No. 164195, 5 April 2011, EN BANC (Brion, J.)
For compensation to be considered just, it must not only be the full and fair equivalent of the
property taken; it must also be paid to the landowner without delay.
Land Bank of the Philippines (LBP) filed a second Motion for Reconsidereation of the
Supreme Court’s Resolutions of October 12, 2010 and November 23, 2010. This case was originally
handled by the Third Division of the Supreme Court. In its original Decision of February 6, 2007, the
Division affirmed the RTCs decision setting the just compensation to be paid and fixing the interest
due on the balance of the compensation due at 12% per annum. In its Resolution of December 19,
2007, the Third Division resolved the parties’ motions for reconsideration by deleting the 12%
interest due on the balance of the awarded just compensation. The parties subsequent motions to
reconsider this Resolution were denied on April 30, 2008; on May 16, 2008, entry of judgment
followed. Despite the entry of judgment, the present petitioners filed a second motion for
reconsideration that prayed as well that the case be referred to the Court en banc. Finding merit in
these motions, the Third Division referred the case to the En Banc for its disposition.
On December 4, 2009, the Court en banc denied the petitioners second motion for
reconsideration. Maintaining their belief in their demand to be granted 12% interest, the petitioners
persisted in filing another motion for reconsideration. In the interim, the Court promulgated its
Internal Rules that regulated, among others, 2nd motions for reconsideration. On October 12, 2010,
the Court en banc granted by a vote of 8 for and 4 against the petitioners motion and awarded the
12% interests the petitioners prayed for, thus affirming the interests the RTC originally awarded. The
Court subsequently denied the respondents motion for reconsideration, giving rise to the present
2nd motion for reconsideration.It was at this point that the OSG moved for leave to intervene.
ISSUE:
Whether or not there was proper payment of just compensation.
RULING:
NO. On its face, the staggering difference between the LBP’s initial valuation of the petitioners
properties (totaling P251,379,104.02) and the RTC’s valuation (totaling P1,383,179,000.00) a
difference of P1,131,799,895.98 amounting to 81% of the total price betrays the lack of good faith on
the part of the government in dealing with the landowners. The sheer enormity of the difference
between the two amounts cannot but lead us to conclude that the LBPs error was grievous and
amounted to nothing less than gross negligence in the exercise of its duty in this case, to properly
ascertain the just compensation due to the petitioners. It is undisputed that the government took the
petitioners lands on December 9, 1996; the petitioners only received full payment of the just
compensation due on May 9, 2008. This circumstance, by itself, already confirms the unconscionable
delay in the payment of just compensation.
It should be considered as highlighted in our October 12, 2010 Resolution that the properties
the government took were fully operating and earning plantations at the time of the taking. Thus, the
landowners lost not only their properties, but the fruits of these properties. These were all lost in
1996, leaving the landowners without any replacement income from their properties, except for the
possible interest for the trifling payment made at the time of the taking that, together with the
subsequent payment, only amounted to a third of the total amount due. Thus, for twelve long years,
the amount of P971,409,831.68 was withheld from the landowners.
An added dimension to this delayed payment is the impact of the delay. One impact as pointed
out above is the loss of income the landowners suffered. Another impact that the LBP now glosses
over is the income that the LBP earned from the sizeable sum it withheld for twelve long years. From
this perspective, the unaccounted-for LBP income is unjust enrichment in its favor and an inequitable
loss to the landowners. This situation was what the Court essentially addressed when it awarded the
petitioners 12% interest.
LAND BANK OF THE PHILIPPINES v. HEIRS OF SEVERINO LISTANA

The SAC has original and exclusive jurisdiction over petitions for determination of the amount
of just compensation of properties acquired under RA No. 6657. Administrative agencies have no
jurisdiction over just compensation cases.
Severino Listana (Listana) owned a parcel of land in Inlagadian, Casiguran, Sorsogon. Listana
voluntarily sold the property to the government, through the Department of Agrarian Reform, under
Republic Act (RA) No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988.
The Department of Agrarian Reform Adjudication Board (DARAB) of Sorsogon set the amount of just
compensation at P10,956,963.25 and ordered petitioner Land Bank of the Philippines (LBP) to
pay Listana the same.
Subsequently, the Provincial Agrarian Reform Adjudicator (PARAD) issued a writ of

execution ordering Land Bank Manager and Agrarian Operations Center Head Alex
A. Lorayes (Lorayes) to pay Listana P10,956,963.25. Lorayes refused. Thus, Listana filed with the
PARAD a motion for contempt against Lorayes. The LBP filed with the Regional Trial Court acting as
special agrarian court (SAC), a petition for judicial determination of the amount of just compensation
for the property. LBP challenged the amount set by the DARAB and prayed that the amount be fixed
at P5,871,689.03. Meanwhile, the PARAD granted Listana’s motion citing Lorayes for indirect
contempt and ordered his imprisonment until he complied with the DARABs Decision.The SAC
dismissed LBPs petition for judicial determination of the amount of just compensation for the
property. Thereafter, the PARAD ordered the issuance of an alias writ of execution, ordering LBP to
pay Listana P10,956,963.25. The PARAD also issued a warrant of arrest against Lorayes. LBP filed
with the RTC a petition for injunction with application for the issuance of a writ of preliminary
injunction enjoining PARAD from implementing the warrant of arrest against Lorayes. The RTC
enjoined the PARAD from implementing the warrant of arrest pending final determination of the
amount of just compensation for the property. LBP posted a P5,644,773.02 cash bond.
Listana filed with the RTC a motion for reconsideration but the RTC denied the
motion. Listana filed with the Court of Appeals a petition for certiorari and the Court of Appeals set
aside the Orders of the RTC. LBP filed with the Court a petition for review on certiorari. In Land Bank
of the Philippines v. Listana, Sr., the Court reinstated the Orders of the RTC enjoining the PARAD from
implementing the warrant of arrest pending final determination of the amount of just compensation
for the property. The Court declared void all proceedings that stemmed from Listanas motion for
contempt. The LBP filed with the RTC a motion to withdraw the P5,644,773.02 cash bond which the
RTC denied. On appeal to the CA, it dismissed LBPs petition and affirmed in toto the RTCs orders.
ISSUES
1. Whether or not the cash bond may be withdrawn.

2. Whether or not the decision of the DARAB setting the amount of just compensation is
executory.
RULING
1. NO. The dispositive portion of the 29 January 2001 Order of the RTC clearly states that the
respondent Provincial Adjudicator of the DARAB x x x is enjoined x x x from enforcing its order of
arrest against Mr. Alex A. Lorayes pending the final termination of the case before RTC Branch
52, Sorsogon upon the posting of a cash bond by Land Bank. Thus, LBP cannot withdraw the bond
pending final determination of the amount of just compensation for the property.
In its 14 October 1998 Decision, the DARAB set the amount of just compensation for the
property at P10,956,963.25 and ordered LBP to pay Listana the amount. On 18 June 1999, the PARAD
issued a writ of execution ordering Lorayes to pay Listana the amount. Lorayes refused and, later,
LBP filed with the RTC a petition for injunction with application for the issuance of a writ of
preliminary injunction. An applicant for preliminary injunction is required to file a bond executed to
the party or person enjoined, to the effect that the applicant will pay to such party or person all
damages which he may sustain by reason of the injunction. As correctly ruled by the lower courts,
the P5,644,773.02 bond shall answer for the damages Listana may sustain if the courts finally uphold
the P10,956,963.25 just compensation set by the DARAB.
2. NO. The SAC has original and exclusive jurisdiction over petitions for determination of the
amount of just compensation of properties acquired under RA No. 6657. Administrative agencies
have no jurisdiction over just compensation cases. Section 57 of RA No. 6657 states that, The Special
Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the determination
of just compensation to landowners. Thus, as a rule, the DARABs decision setting the amount of just
compensation is merely preliminary and not executory if challenged before the SAC. Execution
pending appeal of the DARAB decision is allowed only on meritorious grounds. Even then, it is the
SAC, not the DARAB, that can grant execution pending appeal because the SAC has original and
exclusive jurisdiction over just compensation cases. The determination of the amount of just
compensation is a judicial function that cannot be usurped by administrative agencies.
In the present case, LBP filed with the SAC a petition for determination of the amount of just
compensation on 6 September 1999. The PARAD issued the alias writ of execution and warrant of
arrest on 27 November 2000 and 3 January 2001, respectively. The writ of execution and warrant of
arrest were invalid because the 14 October 1998 Decision of the DARAB setting the amount
at P10,956,963.25 was merely preliminary and not executory.
HEIRS OF FELICIDAD VDA. DE DELA CRUZ v. HEIRS OF PEDRO T. FAJARDO

A compromise agreement is final and executory. Such a final and executory judgment cannot be
modified or amended.
Joaquin Garces (Garces) owned two parcels of land in Barangay Pambuan, Gapan, Nueva Ecija.
The properties were tenanted by Cervando Garcia (Garcia), Pedro Fajardo (Fajardo), and Felicidad
Vda. de Dela Cruz (Vda. de Dela Cruz). Pursuant to Presidential Decree No. 27, the Department of
Agrarian Reform identified Garcia, Fajardo and Vda. de Dela Cruz as qualified tenant-farmers. The
heirs of Garces filed with the Regional Trial Court (RTC), Judicial Region 3, Branch 23, Cabanatuan
City, acting as special agrarian court, a petition for judicial determination of just compensation and
payment of lease against Garcia, Fajardo and Vda. de Dela Cruz. During the pre-trial, the heirs of
Garces entered into a compromise agreement with Garcia, Fajardo and Vda. de Dela Cruz which the
RTC approved. Pursuant to the compromise agreement, Garcia, Fajardo and Vda. de Dela Cruz were
issued their corresponding certificates of land transfer and emancipation patents. The decision
became final and executory.
Subsequently, Vda. de Dela Cruz filed with the PARAD a petition for cancellation of
Emancipation Patent No. A-051521-H issued to Fajardo. Vda. de Dela Cruz alleged that she, not
Fajardo, was the actual tenant and possessor of the 619-square meter parcel of land covered by the
emancipation patent. The PARAD dismissed the petition for cancellation of emancipation patent
because Vda. de Dela Cruz failed to adduce substantial evidence. On appeal to the DARAB, it affirmed
the PARADs Decision. The Court of Appeals affirmed the DARAB's Decision.
ISSUE
Whether the Emancipation Patent was erroneously issued to Fajardo
RULING
NO. The RTC's Decision has long become final and executory, thus, it can no longer be
disturbed. Vda. de Dela Cruz entered into a compromise agreement with the heirs of Garces. There is
no question that under the compromise agreement, the 619-square meter parcel of land covered by
Emancipation Patent No. A-051521-H was given to Fajardo. The RTC approved the compromise
agreement.
In Inaldo v. Balagot, the Court held that: “A compromise agreement is final and executory. Such a final
and executory judgment cannot be modified or amended. If an amendment is to be made, it may
consist only of supplying an omission, or striking out a superfluity or interpreting an ambiguous
phrase therein in relation to the body of the decision which gives it life.”
Tenancy
LUCIA RODRIGUEZ AND PRUDENCIA RODRIGUEZ v. TERESITA V. SALVADOR

Agricultural tenancy is not presumed but must be proven by the person alleging it. Mere occupation or
cultivation of an agricultural land will not ipso facto make the tiller an agricultural tenant.
Teresita V. Salvador (Salvador) filed a Complaint for Unlawful Detainer, against petitioners
Lucia and Prudencia Rodriguez (Rodriguezes), mother and daughter, respectively before the
Municipal Trial Court (MTC) of Dalaguete, Cebu. Salvador alleged that she is the absolute owner of a
parcel of land issued by virtue of Free Patent No. (VII-5) 2646 in the name of the Heirs of Cristino
Salvador represented by Teresita Salvador; that the Rodriguezes acquired possession of the subject
land by mere tolerance of her predecessors-in-interest; and that despite several verbal and written
demands made by her, they refused to vacate the subject land.
In their Answer, the Rodriguezes interposed the defense of agricultural tenancy. Lucia
claimed that she and her deceased husband, Serapio, entered the subject land with the consent and
permission of respondents predecessors-in-interest, siblings Cristino and Sana Salvador, under the
agreement that Lucia and Serapio would devote the property to agricultural production and share
the produce with the Salvador siblings. Since there is a tenancy relationship between the parties, the
Rodriguezes argued that it is the Department of Agrarian Reform Adjudication Board (DARAB) which
has jurisdiction over the case and not the MTC. The MTC rendered a decision finding the existence of
an agricultural tenancy relationship between the parties, and thereby, dismissing the complaint for
lack of jurisdiction. The RTC affirmed the MTC's decision. The Court of Appeals ruled in favor of
Salvador that no tenancy relationship exists between the parties because the Rodriguezes failed to
prove that Salvador or her predecessors-in-interest consented to the tenancy relationship.
ISSUE:
Whether agricultural tenancy relationship exists between the parties.
RULING:
NO. Agricultural tenancy exists when all the following requisites are present: 1) the parties
are the landowner and the tenant or agricultural lessee; 2) the subject matter of the relationship is
an agricultural land; 3) there is consent between the parties to the relationship; 4) the purpose of the
relationship is to bring about agricultural production; 5) there is personal cultivation on the part of
the tenant or agricultural lessee; and 6) the harvest is shared between landowner and tenant or
agricultural lessee. The statements in the affidavits presented by the petitioners are not sufficient to
prove the existence of an agricultural tenancy. As correctly found by the CA, the element of consent
is lacking. Except for the self-serving affidavit of Lucia, no other evidence was submitted to show that
respondents predecessors-in-interest consented to a tenancy relationship with petitioners. Self-
serving statements, however, will not suffice to prove consent of the landowner; independent
evidence is necessary.
Aside from consent, petitioners also failed to prove sharing of harvest. The affidavits of
petitioners neighbors declaring that respondent and her predecessors-in-interest received their
share in the harvest are not sufficient. Petitioners should have presented receipts or any other
evidence to show that there was sharing of harvest and that there was an agreed system of sharing
between them and the landowners. Mere occupation or cultivation of an agricultural land will not
ipso facto make the tiller an agricultural tenant. It is incumbent upon a person who claims to be an
agricultural tenant to prove by substantial evidence all the requisites of agricultural tenancy. In the
instant case, petitioners failed to prove consent and sharing of harvest between the parties.
Consequently, their defense of agricultural tenancy must fail. The MTC has jurisdiction over the
instant case. No error can therefore be attributed to the CA in reversing and setting aside the
dismissal of respondents complaint for lack of jurisdiction. Accordingly, the remand of the case to the
MTC for the determination of the amount of damages due respondent is proper.
ESTATE OF PASTOR M. SAMSON, represented by his heir ROLANDO B. SAMSON v. MERCEDES

R. SUSANO and NORBERTO R. SUSANO
G.R. NO. 179024, 30 MAY 2011, THIRD DIVISION, (VILLARAMA, JR., J.)
It has been repeatedly held that occupancy and cultivation of an agricultural land will not ipso
facto make one a de jure tenant. Independent and concrete evidence is necessary to prove personal
cultivation, sharing of harvest, or consent of the landowner.
Pastor M. Samson owned a 1.0138-hectare parcel of land known as Lot 1108 of the Tala Estate
In 1959, Pastor was approached by his friend Macario Susano who asked for permission to occupy a
portion of Lot 1108 to build a house for his family. Since Pastor was godfather to one of Macario’s
children, Pastor acceded to Macario’s request. Macario and his family occupied 620 square meters of
Lot 1108 and devoted the rest of the land to palay cultivation. Macario’s wife Mercedes R. Susano and
their son Norberto R. Susano, insist that while no agricultural leasehold contract was executed by
Pastor and Macario, Macario religiously paid 15 cavans of palay per agricultural year to Pastor, which
rent was reduced by Pastor in 1986 to 8 cavans of palay per agricultural year.
Meanwhile, in 1981 the reclassification of the subject land into non-agricultural land was
passed by the local government covering the land. On February 28, 1989, Pastor sold Lot 1108-C to
petitioner Julian Chan. Consequently, TCT was issued in Chan’s name. According to Macario’s no
written notice was sent by Pastor to Macario prior to the sale to Chan of Lot comprising an area of
6,696 square meters. They aver that Macario came to know of the transaction only after Chan visited
the property sometime in October 1990 accompanied by an employee from the city government.
Thereafter, claiming rights due to its holding and cultivation it filed a claim to the subject land and
availed of Operation Land Transfer (OLT) Program under Presidential Decree (P.D.) No. 27. As borne
by the records, Macario’s cultivation of the property as well as Pastor’s receipt of a portion of the
produce therein lasted for a considerable length of time or more than thirty years with nary a protest
on the latter’s part. On the otherhand, Pastor claims that he did not expressly give his consent to a
tenancy relation with Macario and merely by tolerance
ISSUE:
Whether or not the Macarios are entitled to the benefits of the OLT Program under P.D. No.
27.
RULING:
NO. Applying our pronouncement in Levardo v. Yatco, we rule that the subject land cannot be
subject to the OLT program of P.D. No. 27 for two reasons: first, the subject land is less than seven
hectares; and second, Macario’s failed to show that Pastor owned other agricultural lands in excess
of seven hectares or urban land from which he derived adequate income, as required by Letter of
Instruction No. 474. Moreover, the DAR Memorandum on the "Interim Guidelines on Retention by
Small Landowners" dated July 10, 1975 is explicit:
5. Tenanted rice and/or corn lands seven (7) hectares or less shall not be
covered by Operation Land Transfer. The relation of the land owner and tenant-
farmers in these areas shall be leasehold
However, while the disputed landholding which had an original aggregate area of only 1.0138
hectares is not covered by the OLT program, the same may still be covered by P.D. No. 27, albeit under
its Operation Land Leasehold (OLL) program. The OLL program placed landowners and tenants of
agricultural land devoted to rice and corn into a leasehold relationship as of October 21, 1972.But
the fact that Macario, predecessor-in-interest, was a de jure tenant must be established. Albeit our
ruling in Co v. Intermediate Appellate Court, wherein we said that Metro Manila Zoning Ordinance
No. 81-01 did not have the effect of discontinuing rights previously acquired over lands located
within the reclassified zone which are neither residential nor light industrial in nature. However, no
independent and concrete evidence were adduced by Susanos to prove that there was indeed consent
and sharing of harvests between Pastor and Macario.
It has been repeatedly held that occupancy and cultivation of an agricultural land will not ipso
facto make one a de jure tenant. Independent and concrete evidence is necessary to prove personal
cultivation, sharing of harvest, or consent of the landowner. Substantial evidence necessary to
establish the fact of sharing cannot be satisfied by a mere scintilla of evidence; there must be concrete
evidence on record adequate to prove the element of sharing. To prove sharing of harvests, a receipt
or any other credible evidence must be presented, because self-serving statements are
inadequate. Tenancy relationship cannot be presumed; the elements for its existence are explicit in
law and cannot be done away with by conjectures. Leasehold relationship is not brought about by
the mere congruence of facts but, being a legal relationship, the mutual will of the parties to that
relationship should be primordial. For implied tenancy to arise it is necessary that all the essential
requisites of tenancy must be present.
Conversion
AYALA LAND, INC. and CAPITOL CITIFARMS, INC v. SIMEONA CASTILLO, et al.
G. R. No. 178110, 15 June 2011, THIRD DIVISION (Sereno, J.)
A conversion order is a final judgment and cannot be repeatedly assailed by respondents in

perpetuity, after they have received compensation and exhausted other means.
Capitol Citifarms, Inc. (CCFI) and its successor-in-interest Ayala Land, Inc. (ALI) filed a
Petition for Review on Certiorari under Rule 45 of the Rules of Court questioning the Decision of the
Court of Appeals (CA) which reversed the Decision of the Office of the President (OP). CCFI owned
two parcels of land mortgaged in favor of one of CCFI’s creditors, MBC which was placed under
receivership. The DAR issued a Notice of Coverage placing the property under compulsory
acquisition under the Comprehensive Agrarian Reform Law of 1988. CCFI was unable to comply with
its mortgage obligations to MBC so it foreclosed on the lien, and the land was awarded to it in an
auction sale. Subsequently, the Supreme Court ordered MBCs partial liquidation and allowed the
receiver-designate of the BSP to sell the banks assets, including the subject landholding, at their fair
market value. In a Deed of Partial Redemption, CCFI was authorized to partially redeem the two
parcels of land and sell them to a third party, pending full payment of the redemption price. Under
the Deed, the downpayment would be payable to the bank only upon approval of the exemption of
the two parcels of land from the coverage of CARL or upon their conversion to non-agricultural use.
The property was sold to petitioner ALI in an Absolute Deed of Sale. The Deed stated that MBC was
to continue to have custody of the corresponding titles for as long as any obligation remained due it.
DAR Secretary Ernesto Garilao denied the request to issue an order exempting the
landholdings of MBC from CARL and to declare a moratorium on the compulsory acquisition of MBCs
landholdings. The OP through Executive Secretary Ruben D. Torres ordered the DAR to cease and
desist from subjecting MBCs properties to the CARL or from otherwise distributing to farmer-
beneficiaries those parcels of land already covered. Subsequently, Secretary Garilao issued
Conversion Order No. 4-97-1029-051, approving the conversion and/or exemption of the 221-
hectare property in Silang.
Almost three years after the Conversion Order had been in force and effect, respondent
farmers who were tilling the subject land filed a Petition for Revocation of the Conversion Order.
They alleged that the sale in 1995 by CCFI to ALI was invalid and that CCFI and ALI were guilty of
misrepresentation in claiming that the property had been reclassified through a mere Resolution,
when the law required an ordinance of the Sanggunian. The issue of the alleged Notice of Acquisition
was never raised. Neither was there any mention of the issuance of a Notice of Coverage.
CCFI and ALI, on the other hand, argued that the claim of the farmers had prescribed, as
mandated by Section 34 of Administrative Order No. (A.O.) 1, Series of 1999, which laid down a one-
year prescriptive period for the filing of a petition to cancel or withdraw conversion. They stated
further that the farmers had already received their disturbance compensation as evidenced in
a Kasunduan, in compliance with the Conversion Order.
DAR Secretary Horacio Morales, Jr. issued an Order declaring that the action to revoke the
conversion had not yet prescribed. As for the two issues raised by the farmer-beneficiaries, these
were resolved by Secretary Morales in favor of CCFI and ALI. Secretary Morales never passed upon
or even mentioned any matter related to the Notice of Acquisition. Secretary Morales declared that
CCFI and ALI had completed the payment of disturbance compensation to the farmers, as shown by
the Kasunduan, which was a waiver of all the farmers rights over the landholding, and by
the Katunayan ng Pagbabayad, which expressly acknowledged the amounts paid as the full and final
settlement of their claims against CCFI and ALI.
The OP Decision upheld Conversion Order No. 4-97-1029-051 issued by then Secretary of the
Department of Agrarian Reform (DAR) Ernesto Garilao, as well as the Orders issued by Secretary
Hernani Braganza and Secretary Roberto Pagdanganan both affirming the conversion. The CA found
merit in the OPs rationale for maintaining the Conversion Order, yet invalidated the same on the basis
that a Notice of Coverage and a Notice of Acquisition had already been issued over the lands hence,
they could no longer be subject to conversion.
ISSUES:
1. Whether the Notice of Acquisition bars the issuance of a Conversion Order

2. Whether the Conversion Order may still be appealed
RULING:
1. NO. Assuming for a moment that the notice of acquisition exists, it is not an absolute, perpetual
ban on conversion. The provision invoked in AO 12-94, paragraph E, disallows applications for
conversion of lands for which the DAR has issued a notice of acquisition. But paragraph E falls under
heading VI, Policies and Guiding Principles. By no stretch of the imagination can a mere principle be
interpreted as an absolute proscription on conversion. Secretary Garilao thus acted within his
authority in issuing the Conversion Order, precisely because the law grants him the sole power to
make this policy judgment, despite the guiding principle regarding the notice of acquisition. The CA
committed grave error by favoring a principle over the DARs own factual determination of the
propriety of conversion.
2. NO. DAR A.O. 1, Series of 1999 lays down a one-year prescriptive period for petitions for
cancellation or withdrawal. The Conversion Order was issued by Secretary Garilao on 31 October
1997. Respondents questioned the Order only on 19 May 2000, almost two years and seven months
later. Since the action was filed during the effectivity of A.O. 01-99, its provision on prescription
should apply. The Conversion Order is final and executory. A conversion order is a final judgment
and cannot be repeatedly assailed by respondents in perpetuity, after they have received
compensation and exhausted other means. In Villorente, the Court had occasion to rebuke the would-
be beneficiaries who, after accepting the compensation stipulated in the conversion Order thereby
impliedly acknowledging the validity of the order turned around and suddenly assailed it.
Landbank, in Expropriation Proceedings
DAVAO FRUITS CORPORATION v. LAND BANK OF THE PHILIPPINES

G.R. No. 181566 and 181570, 9 March 2011, SECOND DIVISION (Carpio, J.)
LBP is an agency created to provide financial support in all phases of agrarian reform pursuant
to Section 64 of CARL. Once an expropriation proceeding for acquisition of private agricultural lands
commenced, the indispensable role of LBP begins.
Davao Fruits Corporation (DFC) owned a bamboo plantation consisting of 10 parcels of land.
DFC voluntarily offered such for sale to the government under Republic Act No. 6657 or the
Comprehensive Agraria Reform Law (CARL). Department of Agriculture (DAR) initiated the survey,
subdivision, and cancellation of the individual titles in favor of the government. Land Bank of the
Philippines (LBP) is the bank designated under the law to be the financial intermediary of the
agrarian reform program. The DAR and LBP computed the value of the property. DFC rejected the
valuation. Consequently, the Agrarian Reform Officer referred the issue on just compensation to the
Department of Agrarian Reform Adjudication Board (DARAB). DARAV fixed the valuation according
to the nature of the lot- bamboo area and brush land. DFC and DBP moved for reconsideration but
were denied. LBP filed a petition for fixing just compensation with RTC sitting as Special Agrarian
Court (SAC). DFC moved to dismiss arguing that LBP has no authority to sue on behalf of the Republic
of the Philippines and question valuation made by DAR. SAC dismissed the petition. On appeal, Court
of Appeals (CA) set aside SAC dismissal of LBP’s petition and rejected the contention that LBP has no
personality to sue and question valuation.
ISSUE:
Whether or not LBP has the personality to file petition for determination of just compensation
before the SAC
RULING:
YES. LBP is an agency created to provide financial support in all phases of agrarian reform
pursuant to Section 64 of CARL. It is vested with the primary responsibility and authority in the
valuation and compensation of covered landholdings to carry out the full implementation of the
Agrarian Reform Program. It may agree with the DAR and landowner as to the amount of just
compensation and may also disagree with them and bring the matte to court for judicial
determination. As ruled in Heirs of Roque Tabuena v. Land Bank of the Philippines, once an
expropriation proceeding for acquisition of private agricultural lands commenced, the indispensable
role of LBP begins. LBP is not merely a nominal party in determination of just compensation, but an
indispensable participant in such proceedings.there can be no judicial determination of just
compensation absent LBP’s participation. As such, LBP has the legal personality to institute a petition
for determination of just compensation before SAC.
CIVIL LAW
GENERAL PRINCIPLES
Human Relations
EUSEBIO GONZALES v. PHILIPPINE COMMERCIAL AND INTERNATIONAL BANK, et al.

G.R. No. 180257, 23 February 2011, FIRST DIVISION (Velasco, J.)
In order for Article 19 to be actionable, the following elements must be present: (1) the existence
of a legal right or duty, (2) which is exercised in bad faith, and (3) for the sole intent of prejudicing or
injuring another.
Eusebio Gonzales (Gonzales) was granted a Credit-On-Hand Loan Agreement (COHLA) by

Philippine Commercial and International Bank (PCIB) with his accounts as collateral on the limit of
the credit line. Gonzales and his spouse obtained three (3) loans from PCIB which was secured by a
real estate mortagage over a parcel of land executed by Gonzales and Spouses Jose and Jocelyn
Panlilio (Spouses Panlilio) who likewise obtained one of the loans together with Gonzales. Several
promissory notes were likewise issued specifying the solidary liability of Gonzales and Spouses
Panlilio. Thereafter, the Spouses Panlilio who received the total amount of the loan, failed to pay the
interests due from their PCIB account. When Gonzales issued a check in favor of Rene Unson (Unson),
it was dishonored by the bank due to the termination by the PCIB of the credit line under COHLA and
likewise froze the foreign account of Gonzales.
Upon the failure of PCIB to pay the check to Unson, Gonzales was forced to pay him in cash.
Gonzales likewise demanded the bank to unfreeze his account since it was not him who benefitted
from the loans but the Spouses Panlilio. However, PCIB still refused to heed his demand. Hence,
Gonzales filed a case for damages against PCIB for unjust dishonor of the check issued in favor of
Unson. The Regional Trial Court (RTC) ruled in favor of PCIB and found Gonzales solidarily liable
with spouses Panlilio and that the dishonor of the check as well as the freezing of the foreign account
was justified. The Court of Appeals (CA) affirmed.
ISSUE:
Whether or not PCIB was negligent in not giving prior notice to Gonzales in terminating the
COHLA as stipulated in the agreement.
RULING:
YES. PCIB was grossly negligent in not giving prior notice to Gonzales about its course of
action to suspend, terminate, or revoke the credit line, thereby violating the clear stipulation in the
COHLA. Indeed, the business of banking is impressed with public interest and great reliance is made
on the bank’s sworn profession of diligence and meticulousness in giving irreproachable service. Like
a common carrier whose business is imbued with public interest, a bank should exercise
extraordinary diligence to negate its liability to the depositors. In this instance, PCIB is sorely remiss
in the diligence required in treating with its client, Gonzales.
In order for Article 19 to be actionable, the following elements must be present: (1) the
existence of a legal right or duty, (2) which is exercised in bad faith, and (3) for the sole intent of
prejudicing or injuring another. The Court found that such elements are present in the instant case.
The effectivity clause of the COHLA is crystal clear that termination of the COHLA should be done
only upon prior notice served on the CLIENT. This is the legal duty of PCIB – to inform Gonzales of
the termination. However, as shown by the testimonies, PCIB failed to give prior notice to Gonzales.
Malice or bad faith is at the core of Article 19. Malice or bad faith “implies a conscious and
intentional design to do a wrongful act for a dishonest purpose or moral obliquity.” In the instant
case, PCIB was able to send a letter advising Gonzales of the unpaid interest on the loans but failed to
mention anything about the termination of the COHLA. More significantly, no letter was ever sent to
him about the termination of the COHLA. The failure to give prior notice on the part of PCIB is already
prima facie evidence of bad faith. Therefore, it is abundantly clear that this case falls squarely within
the purview of the principle of abuse of rights as embodied in Article 19.
PHILIPPINE REALTY AND HOLDINGS CORP. v. LEY CONSTRUCTION AND DEVELOPMENT

CORP.
G.R. No. 165548, 13 June 2011, THIRD DIVISION (Sereno, J.)
LEY CONSTRUCTION AND DEVELOPMENT CORP. v. PHILIPPINE REALTY AND HOLDINGS

CORP.
In order for an unjust enrichment claim to prosper, one must not only prove that the other party
benefited from one’s efforts or the obligations of others; it must also be shown that the other party was
unjustly enriched in the sense that the term unjustly could mean illegally or unlawfully.
Ley Construction and Development Corp. (LCDC) and Philippine Realty and Holdings Corp.
(PRHC) entered into four contracts where the former would construct buildings for the latter, which
included the Tektite Building. The contracts for the four buildings had the same wordings, which
settles a fixed price for each project, and had a provision stating that there shall be no increase in the
contract price unless it is pursuant to an increase in minimum wage. An increase in price of materials
was not considered.
PRHC paid them in installments, used by LCDC to purchase the necessary construction
materials. Later on, it became evident that LCDC could not finish the Tektite Building. LCDC met with
PRHC project construction manager, Engineer Dennis Abcede, to discuss the delay, which LCDC
attributed to the increase in the price of materials that meant the monthly payments insufficient.
Their meeting led to an agreement that LCDC would advance P36 M to buy the materials for the
meantime, on the condition that PRHC would escalate the contract price, which Abcede promised to
take up with PRHC board of directors.
The board denied the proposal, but Abcede did not inform LCDC. Nonetheless, Abcede sent a
letter to LCDC asking for its conformity to advance the money. The letter did not bear PRHC’s
signature. Despite this, LCDC proceeded with the construction of the Tektite Building and shelled out
P38.2 M paid directly to the suppliers instead of LCDC and PRHC’s joint account.
Upon completion of the Tektite Building, LCDC demanded the escalation price worth P38 M,
but PRHC never replied. PRHC denied any liability and claimed damages for LCDC’s delay. Thus, LCDC
filed a complaint to recover the money PRHC owed. The Regional Trial Court (RTC) ordered PRHC to
pay LCDC the amounts. The Court of Appeals (CA) reversed the decision and held that LCDC must pay
damages to PRHC for the delay in construction.
ISSUE:
Whether or not the escalation agreement was valid and, if so, to what amount.
RULING:
YES. The subsequent escalation agreement was validly entered into by the parties, but only
to the extent of P 36 million. The 9 August 1991 letter is not a simple letter, but rather a letter-
agreement contract, which, because of the existence of the consent of both parties, become valid and
binding. It is true that no representative of PRHC signed under its typewritten name, where a
signature should traditionally appear, to show the company’s acceptance and approval of the
contents of the letter-agreement. This Court, however, finds that the signature of Abcede is sufficient
to bind PRHC. As its construction manager, his very act of signing a letter embodying the P36 million
escalation agreement produced legal effect, even if there was a blank space for a higher officer of
PHRC to indicate approval thereof.
This liability of PRHC, however, has a ceiling. The escalation agreement entered into was
for P36 million the maximum amount that LCDC contracted itself to infuse and that PRHC agreed to
reimburse. Thus, the Court of Appeals was correct in ruling that the P 2,248,463.92 infused by LCDC
over and above the P36 million should be for its account, since PRHC never agreed to pay anything
beyond the latter amount. While PRHC benefited from this excess infusion, this did not result in its
unjust enrichment, as defined by law.
In order for an unjust enrichment claim to prosper, one must not only prove that the other
party benefited from one’s efforts or the obligations of others; it must also be shown that the other
party was unjustly enriched in the sense that the term unjustly could mean illegally or unlawfully.
LCDC was aware that the escalation agreement was limited to P36 million. It is not entitled to
remuneration of the excess, since it did not confer this benefit by mistake, fraud, coercion, or request.
Rather, it voluntarily infused the excess amount with full knowledge that PRHC had no obligation to
reimburse it.
ALFONSO T. YUCHENGCO v. THE MANILA CHRONICLE PUBLISHING CORPORATION, et al.

G.R. No. 184315, 28 November 2011, SPECIAL THIRD DIVISION (Peralta, J.)
The question of whether the principle of abuse of rights has been violated resulting in damages
under Article 20 or other applicable provision of law, depends on the circumstances of each case.
Several allegedly defamatory articles against Alfonso T. Yuchengco were published in The
Manila Chronicle by Chronicle Publishing Corporation. Consequently, Yuchengco filed a complaint
before the Regional Trial Court (RTC), under three separate causes of action, namely: (1) for damages
due to libelous publication against Neal H. Cruz, Ernesto Tolentino, Noel Cabrera, Thelma San Juan,
Gerry Zaragoza, Donna Gatdula, Raul Valino, Rodney P. Diola, all members of the editorial staff and
writers of The Manila Chronicle, and Chronicle Publishing (Cruz, et al.); (2) for damages due to abuse
of right against Robert Coyiuto, Jr. and Chronicle Publishing; and (3) for attorney’s fees and costs
against Cruz, et al. The trial court ruled in favor of Yuchengco. Aggrieved, Cruz, et al and Coyiuto, Jr.
sought recourse before the Court of Appeals (CA). The CA affirmed in toto the decision of the RTC.
Upon Motion for Reconsideration, the CA reversed the earlier Decision. Subsequently, Yunchengco
filed the present recourse before this Court which partially granted the petition. Cruz, et al. and
Coyiuto, Jr. later filed a Motion for Reconsideration which the Court denied. Meanwhile, respondent
Coyiuto, Jr. also filed a Motion for Leave to File Supplemental Motion for Reconsideration with
Attached Supplemental Motion. The Court resolved to recall its earlier Resolution; granted Coyiuto,
Jr.’s motion for leave to file supplemental motion for reconsideration; note the supplemental motion
for reconsideration.
In his Supplemental Motion for Reconsideration, Coyiuto, Jr. argues that he was not sued for
damages based on the libellous publications but on his personal capacity for abuse of right as
Chairman of the Board, officer, principal owner, of the Manila Chronicle Publishing Corporation
under Article 19 and 20 of the Civil Code. As such, the imposition of moral (P25 million pesos) and
exemplary (P10 million pesos) damages has no basis. He averred that there was no evidence
presented on trial to support the allegation that Coyiuto, Jr. was Chairman, principal owner and
officer of Manila Chronicle Publishing Corporation. Hence, he should not be held liable.
ISSUE:
Whether Coyiuto, Jr. should be held for damages.
RULING:
YES. Contrary to Coyiuto, Jr.’s contention, it was substantially established that he was the
Chairman of Manila Chronicle Publishing Corporation when the subject articles were
published. Coyiuto, Jr. even admitted this fact in his Reply and Comment on Request for Admission.
More importantly and contrary again to Coyiuto, Jr.’s contention, the cause of action of
petitioner based on abuse of rights, or Article 19, in relation to Article 20 of the Civil Code, warrants
the award of damages. This provision of law sets standards which must be observed in the exercise
of ones rights as well as in the performance of its duties, to wit: to act with justice; give everyone his
due; and observe honesty and good faith.
In Globe Mackay Cable and Radio Corporation v. Court of Appeals, it was elucidated that while
Article 19 lays down a rule of conduct for the government of human relations and for the maintenance
of social order, it does not provide a remedy for its violation. Generally, an action for damages under
either Article 20 or Article 21 would be proper.
Corollarilly, Article 20 provides that every person who, contrary to law, willfully or
negligently causes damage to another shall indemnify the latter for the same. It speaks of the general
sanctions of all other provisions of law which do not especially provide for its own sanction. When a
right is exercised in a manner which does not conform to the standards set forth in the said provision
and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must
be responsible. Thus, if the provision does not provide a remedy for its violation, an action for
damages under either Article 20 or Article 21 of the Civil Code would be proper.
The question of whether or not the principle of abuse of rights has been violated resulting in
damages under Article 20 or other applicable provision of law, depends on the circumstances of each
case. In the present case, it was found that Coyiuto, Jr. indeed abused his rights as Chairman of The
Manila Chronicle, which led to the publication of the libelous articles in the said newspaper, thus,
entitling petitioner to damages under Article 19, in relation to Article 20.
However, despite the foregoing, the damages awarded to petitioner appear to be too
excessive and warrants a second hard look by the Court. While there is no hard-and-fast rule in
determining what would be a fair and reasonable amount of moral damages, the same should not be
palpably and scandalously excessive. Moral damages are not intended to impose a penalty to the
wrongdoer, neither to enrich the claimant at the expense of the defendant. Moral damages are not a
bonanza. They are given to ease the defendant’s grief and suffering. Moral damages should be
reasonably approximate to the extent of the hurt caused and the gravity of the wrong done.
PERSONS AND FAMILY RELATIONS
Marriage
ROSALINO MARABLE v. MYRNA MARABLE

G.R. No. 178741, 17 January 2011 THIRD DIVISION (Villarama, Jr., J.)
Psychological incapacity as contemplated in Article 36 of the Family Code, refers to a serious

psychological illness that is afflicting party before the celebration of marriage.
Rosalino Marable (Rosalino) and Myrna Marable (Myrna) were schoolmates at the Arellano
University where they met and eventually became lovers. They married in Tanay, Rizal and were
blessed with five (5) children. Their relationship continued to gradually deteriorate and quarrels
became more frequent with one of their children apparently becoming pregnant. As a result of the
feud, Rosalino filed a petition for declaration of nullity of marriage. Rosalino presented a psychologist
which attested that his patient has Antisocial Personality Disorder that makes him rebel and hate all
his peers and families. The Regional Trial Court (RTC) granted the nullity of marriage Rosalino while
the Court of Appeals (CA) reversed and set aside the decision of the lower court.
ISSUE:
Whether or not the nullity of marriage based on psychological incapacity should be granted.
RULING:
NO. Psychological incapacity as contemplated in Article 36 of the Family Code, refers to a

serious psychological illness that is afflicting party before the celebration of marriage. The grounds
laid down in the case of Republic v. Court of Appeals clearly states that such ailment must be present
before the celebration of the marriage along with other requisites such as incurability and the gravity
of the illness. In this case, Rosalino only presented the lone testimony of his psychologist that stated
that the ailment of his patient his severe but did not prove that such ailment did not manifest before
the celebration of his marriage.
ALAIN DIO v. MA. CARIDAD DIO

G.R. No. 178044, 19 January 2011 SECOND DIVISION (Carpio, J.)
Article 50 of the Family Code does not apply to marriages which are declared
void ab initio under Article 36 of the Family Code, which should be declared void without waiting for the
liquidation of the properties of the parties.
Alain Dio (Alain) and Ma. Caridad Dio (Caridad) are childhood friends and sweethearts. They
eventually decided to get married and was blessed with five (5) children. Over time however, their
relationship eventually soured with fights becoming more frequent and toxic. Alain filed for a petition
of declaration of nullity of marriage based on the ground of psychological incapacity and presented
his testimony that his wife, Caridad, failed to fulfill essential marital obligations and would opt to
spend her time on shopping sprees, thus splurging their family savings instead of devoting it to the
welfare of the children. His psychologist also noted that Caridad is suffering from Narcissistic
Disorder which was deeply ingrained in her system since her formative years and further attested
that such ailment is incurable and long-lasting.
The Regional Trial Court (RTC) granted the petition of Alain and dissolved the marriage upon
the finding that his wife also contracted another marriage with another man while abroad. Alain
however, petitions before the court that such dissolution must only be granted after the liquidation
and appropriation of the absolute community of property between him and his wife.
ISSUE:
Whether or not the decree of declaration of nullity of marriage shall be granted only after the
appropriation and liquidation of property.
RULING:
NO. The Court has ruled in Valdez v. Court of Appeals that a void marriage, the provisions of
Articles 147 and 148 of the Family Code shall apply regarding their property relations when there is
no legal impediment with regard to their marriage. It is clear from Article 50 of the Family Code that
Section 19(1) of the Rule applies only to marriages which are declared void ab initio or annulled by
final judgment under Articles 40 and 45 of the Family Code. In short, Article 50 of the Family Code
does not apply to marriages which are declared void ab initio under Article 36 of the Family Code,
which should be declared void without waiting for the liquidation of the properties of the parties.
CYNTHIA YAMBAO v. REPUBLIC OF THE PHILIPPINES

G.R. No. 185063, 24 January 2011 SECOND DIVISION (Nachura, J.)
The psychological incapacity that is contemplated in the Family Code follows a stringent standard
that must be proven in order for the action of declaration of nullity of marriage to succeed such as: a) a true
inability to commit oneself to the essentials of marriage; (b) this inability to commit oneself must refer
to the essential obligations of marriage: the conjugal act, the community of life and love, the rendering
of mutual help, the procreation and education of offspring; and (c) the inability must be tantamount to
a psychological abnormality.
Cynthia Yambao (Cynthia) filed a petition for a declaration of nullity of marriage wherein she
states that from the early stages of her marriage with Patricio Yambao (Patricio) to the present is
plagued and festered with bickering and quarrels that gradually became more violent over time. She
illustrates further example when she states that Patricio is a gambler and bad businessman where all
of his investments went down the drain. His role as a father was also not fulfilled when he did not
even care for his children from childhood. Cynthia decided to flee the conjugal dwelling when he
made threats to kill her. She eventually consulted a psychiatrist that determined her spouse is indeed
psychologically incapacitated to fulfill essential marital obligations. Patricio meanwhile denied these
claims and said that he never threatened to kill Cynthia. Even if is a bad businessman, he still
contributes to the amortization of their family home in Paranaque.
The Regional Trial Court (RTC) dismissed the petition for lack of merit since it does meet the
strict requirement of what is required in psychological incapacity in the Family Code. The Court of
Appeals (CA) likewise affirmed the same.
ISSUE:
Whether or not the evidence proffered by Cynthia must be given merit and nullity decreed.
RULING:
NO. The psychological incapacity that is contemplated in the Family Code follows a stringent
standard that must be proven in order for the action of declaration of nullity of marriage to succeed such
as: a) a true inability to commit oneself to the essentials of marriage; (b) this inability to commit
oneself must refer to the essential obligations of marriage: the conjugal act, the community of life and
love, the rendering of mutual help, the procreation and education of offspring; and (c) the inability
must be tantamount to a psychological abnormality. The Court does not veer away from the
jurisprudence held in the Molina case. It was shown in this case that Patricio was able to diligently
fulfill his duties as a husband and father in the family and it is highly unlikely that such marriage
survived thirty (30) years and such “abnormality” be considered fatal to the life of the marriage.
JOSE REYNALDO OCHOSA v. REPUBLIC OF THE PHILIPPINES and BONA ALANO

G.R. No. 181833, 26 January 2011 SECOND DIVISION (Abad, J.)
The Court strictly follows the jurisprudence laid down in the Molina case in which it specifically
mandates that what juridical antecedence contemplates is that the ailment must be before the
celebration of the marriage, even if it is not manifested before or during the marriage.
Bona Alano’s (Bona) and Jose Reynaldo Ochosa (Jose) were lawfully wedded. The illicit affairs
of Bona however continued at the outset of the marriage and still continued when Jose was stationed
at various parts of the country due to his military duty. She even continued her infidelity even when
he was stationed at Fort Bonifacio wherever her husband was out of the living quarters. After
sometime however, Jose was incarcerated at Camp Crame for charges of rebellion against him where
he first heard that Bona was caught having sex with his driver Corporal Gagarin. He confronted the
two about it to which they admitted and subsequently filed a petition to nullify their marriage.
Jose presented the testimony of a psychiatrist that evaluated Bona’s psychological

personality. It was stated by the psychiatrist that Bona suffers from histrionic personality disorder
which can be traced to her family’s history. The Regional Trial Court (RTC) granted the petition of
Jose and decreed the nullity of marriage while the Court of Appeals (CA) on the other hand, reversed
the decision of the lower courts.
ISSUE:
Whether or not Jose Ochosa’s testimony warrants the granting of a nullity of marriage.
RULING:
NO. The Court strictly follows the jurisprudence laid down in the Molina in which it
specifically mandates that what juridical antecedence contemplates is that the ailment must be
before the celebration of the marriage, even if it is not manifested before or during the marriage. It
was not proven by Jose Ochosa that the ailment of Bona preceded the celebration of their marriage
since it was only based upon the determination of the psychiatrist that relied on Jose’s testimony
during the trial. These circumstances taints with bias the findings of the expert in diagnosing that
Bona is indeed afflicted with such grave mental state.
ESTRELLITA JULIANO-LLAVE v. REPUBLIC OF THE PHILIPPINES, et al.

G.R. No. 169766, 30 March 2011, FIRST DIVISION (DEL CASTILLO, J.)
A new law ought to affect the future, not what is past. Hence, in the case of subsequent marriage laws, no
vested rights shall be impaired that pertain to the protection of the legitimate union of a married couple.
Around 11 months before his death, Sen. Tamano married Estrellita twice initially under the
Islamic laws and tradition on May 27, 1993 in Cotabato City and, subsequently, under a civil
ceremony officiated by a Regional Trial Court (RTC) Judge at Malabang, Lanao del Sur on June 2, 1993.
Since then, Estrellita has been representing herself to the whole world as Sen. Tamano’s wife, and
upon his death, his widow. After Sen. Tamano’s death, private respondents Haja Putri Zorayda A.
Tamano (Zorayda) and her son Adib Ahmad A. Tamano (Adib), in their own behalf and in behalf of
the rest of Sen. Tamano’s legitimate children with Zorayda, filed a complaint with the RTC of Quezon
City for the declaration of nullity of marriage between Estrellita and Sen. Tamano for being
bigamous. The complaint alleged, inter alia, that Sen. Tamano married Zorayda on May 31, 1958
under civil rites, and that this marriage remained subsisting when he married Estrellita in 1993,
making the subsequent marriage of Sen. Tomano and Estrellita bigamous based on Article 35 (4) of
the Family Code.
Estrellita further averred that the deceased did not and could not have divorced Complainant
Zorayda by invoking the provision of P.D. 1083, otherwise known as the Code of Muslim Personal
Laws, for the simple reason that the marriage of the deceased with Complainant Zorayda was never
deemed, legally and factually, to have been one contracted under Muslim law as provided under Art.
186 (2) of P.D. 1083, since they (deceased and Complainant Zorayda) did not register their mutual
desire to be thus covered by this law.
Estrellita filed a Motion to Dismiss on February 20, 196 where she declared that Sen. Tamano
and Zorayda are both Muslims married under Muslim rites. Estrellita argued that the RTC has no
jurisdiction to take cognizance of the case because under Presidential Decree (PD) No. 1083, or the
Code of Muslim Personal Laws of the Philippines (Muslim Code), questions and issues involving
Muslim marriages and divorce fall under the exclusive jurisdiction of sharia courts. Thus, Estrellita
filed in November 1995 a certiorari petition with Supreme Court questioning the denial of her Motion
to Dismiss. On December 15, 1995, the Supreme Court referred the petition to the CA. Eventually,
however, the CA resolved the petition adverse to Estrellita in its Decision dated September 30,
1996. Estrellita then elevated the appellate courts judgment to this Court by way of a petition for
review on certiorari. During the pendency of the petition, the trial in RTC ensued.
On June 29, 1998, the Supreme Court upheld the jurisdiction of the RTC of Quezon
City, stating as one of the reasons that as shari’a courts are not vested with original and exclusive
jurisdiction in cases of marriages celebrated under both the Civil Code and PD 1083, the RTC, as a
court of general jurisdiction, is not precluded from assuming jurisdiction over such cases. The SC in
a resolution dated August 24, 1998 denied Estrellita’s motion for reconsideration with finality. On
the other hand, on August 18, 1998, the RTC rendered its judgment declaring Estrellita’s marriage
with Sen. Tamano as void ab initio.
ISSUE:
Whether the marriage between Estrellita and the late Sen. Tamano was bigamous.
RULING:
YES. The marriage between the late Sen. Tamano and Zorayda was celebrated in 1958,
solemnized under civil and Muslim rites.The only law in force governing marriage relationships
between Muslims and non-Muslims alike was the Civil Code of 1950, under the provisions of which
only one marriage can exist at any given time. Under the marriage provisions of the Civil Code,
divorce is not recognized except during the effectivity of Republic Act No. 394 which was not availed
of during its effectivity.
The way of divorce under PD 1083 did not severe Sen. Tamano’s prior marriage to Zorayda.
Firstly, Article 13(1) thereof provides that the law applies to marriage and divorce wherein both
parties are Muslims, or wherein only the male party is a Muslim and the marriage is solemnized in
accordance with Muslim law or this Code in any part of the Philippines. Article 13 of PD 1083 does
not provide for a situation where the parties were married both in civil and Muslim rites. Moreover,
the Muslim Code took effect only on February 4, 1977, and this law cannot retroactively override the
Civil Code which already bestowed certain rights on the marriage of Sen. Tamano and Zorayda.
REPUBLIC OF THE PHILIPPINES v. NESTOR GALANG

G.R. No. 168335, 6 JUNE 2011, THIRD DIVISION (Brion, J.)
Psychological incapacity must be characterized by (a) gravity; (b) juridical antecedence; and
(c) incurability. The defect should refer to “no less than a mental (not physical) incapacity that causes a
party to be truly incognitive of the basic marital covenants that concomitantly must be assumed and
discharged by the parties to the marriage.
On March 9, 1994, Nestor Galang and Juvy Galang contracted marriage in Pampanga.
On August 4, 1999, Nestor filed with the RTC a petition for the declaration of nullity of his marriage
with Juvy, under Article 36 of the Family Code, as amended.
He alleged that Juvy was psychologically incapacitated to exercise the essential obligations of
marriage, as she was a kleptomaniac and a swindler. He claimed that Juvy: (a) refused to wake up
early to prepare breakfast; (b) left their child to the care of their neighbors when she went out of the
house; (c) squandered a huge amount of the P15,000.00 that the respondent entrusted to her; (d)
stole the respondent’s ATM card and attempted to withdraw the money deposited in his account; (e)
falsified the respondent’s signature in order to encash a check; (f) made up false stories in order to
borrow money from their relatives; and (g) indulged in gambling. Aside from his testimony, Nestor
also presented Anna Liza S. Guiang, a psychologist, who testified that she conducted a psychological
test on Nestor. According to her, she wrote Juvy a letter requesting for an interview, but the latter did
not respond.
ISSUE:
Whether or not there is basis to nullify Nestor’s marriage to Juvy.
RULING:
NONE. There is no sufficient basis to annul the marriage on the ground of psychological
incapacity under the terms of Article 36 of the Family Code. In Leouel Santos v. Court of Appeals, et al.,
the Court first declared that psychological incapacity must be characterized by (a) gravity;
(b) juridical antecedence; and (c) incurability. The defect should refer to no less than a mental (not
physical) incapacity that causes a party to be truly incognitive of the basic marital covenants that
concomitantly must be assumed and discharged by the parties to the marriage.
In the present case, Juvy’s acts do not per se rise to the level of psychological incapacity that
the law requires. Psychological incapacity must be more than just a "difficulty," "refusal" or "neglect"
in the performance of some marital obligations. Nestor’s testimony failed to show that Juvy’s
condition is a manifestation of a disordered personality rooted in some incapacitating or debilitating
psychological condition that rendered her unable to discharge her essential marital obligation. In this
light, the acts attributed to Juvy only showed indications of immaturity and lack of sense of
responsibility, resulting in nothing more than the difficulty, refusal or neglect in the performance of
marital obligations. Also, the submitted psychological report hardly helps Nestor’s cause. The
psychologist’s report simply stressed Juvy’s negative traits which she considered manifestation’s of
Juvy’s psychological incapacity.
The Court is aware of their pronouncement in Brenda B. Marcos v. Wilson G. Marcos that the
person sought to be declared psychologically incapacitated need not be examined by the
psychologist as a condition precedent to arrive at a conclusion. If the incapacity can be proven by
independent means, no reason exists why such independent proof cannot be admitted to support a
conclusion of psychological incapacity, independently of a psychologist’s examination and report. In
this case, however, no such independent evidence has ever been gathered and adduced. To be sure,
evidence from independent sources who intimately knew Juvy before and after the celebration of her
marriage would have made a lot of difference and could have added weight to the psychologist’s
report.
The psychologist’s court testimony fared no better in proving the juridical antecedence,
gravity or incurability of Juvy’s alleged psychological defect as she merely reiterated what she wrote
in her report. Again, this testimony was totally devoid of any information or insight into Juvy’s early
life and associations, how she acted before and at the time of the marriage, and how the symptoms
of a disordered personality developed. Simply put, the psychologist failed to trace the history of Juvy’s
psychological condition and to relate it to an existing incapacity at the time of the celebration of the
marriage.
Property Relations of the Spouses
ELENITA M. DEWARA v. SPOUSES RONNIE AND GINA LAMELA and STENILE ALVERO
The presumption that the property is conjugal property may be rebutted only by strong, clear,
categorical, and convincing evidence—there must be strict proof of the exclusive ownership of one of
the spouses, and the burden of proof rests upon the party asserting it.
Eduardo Dewara (Eduardo) and petitioner Elenita Magallanes Dewara (Elenita) were
married before the enactment of the Family Code. Thus, the Civil Code governed their marital
relations. They were separated-in-fact because Elenita went to work in California while Eduardo
stayed in Bacolod City. On January 20, 1985, Eduardo, while driving a jeep which was registered in
the name of Elenita, hit respondent Ronnie Lamela (Ronnie). Ronnie filed a case for damages against
Eduardo, but Eduardo had no property in his name. Ronnie then requested the City Sheriff to levy on
Elenita’s property in order to satisfy the judgement on civil liability of Eduardo. The levy on
execution, public auction, issuance of certificate of sale, and cancellation of title of the lot in the name
of Elenita were all done while Elenita was working in California. Hence, Elenita, represented by her
attorney-in-fact, filed a case for annulment of sale against respondents. She claimed that the sale was
illegal because the said property was her paraphernal or exclusive property and could not be made
to answer for the personal liability of her husband. Respondent spouses contend that the lot was the
conjugal property of petitioner Elenita and Eduardo. They asserted that the property was acquired
during her marriage to Eduardo and the property was acquired with Eduardo’s money.
The Regional Trial Court (RTC) declared that the property was paraphernal in nature tracing
the origins of the said property based on the evidence submitted. It was revealed that it was sold by
Elenita’s father to Elenita at a drastically lower price. Hence, it ruled that the sale was essentially a
donation and was gratuitous in character. It ruled that the civil liability of Eduardo cannot be charged
to his wife, Elenita. The CA reversed the decision of the RTC stating that the gross inadequacy of the
price alone does not affect the contract of sale, and that the consent of Elenita’s parents were not
vitiated. It ruled that Elenita and Eduardo acquired the property by onerous title during their
marriage through their common fund and belonged to their conjugal partnership of gains.
ISSUE:
Whether or not the subject property is the paraphernal/exclusive property of Elenita.
RULING:
NO. All property of the marriage is presumed to belong to the conjugal partnership, unless it
be proved that it pertains exclusively to the husband or wife. Registration in the name of either does
not invalidate this presumption. The separation-in-fact does not affect the conjugal partnership.
There is no dispute that the subject property was acquired by the spouses during their marriage as
their marital relations were governed by the conjugal partnership of gains, since they were married
before the enactment of the Family Code and did not execute any prenuptial agreement as to their
property relations. Moreover, aside from Elenita’s assertions that the sale of the property by her
father to her was in the nature of a donation, there is no other evidence that convinced the Court of
the paraphernal character of the property. The presumption that the property is conjugal property
may be rebutted only by strong, clear, categorical, and convincing evidence—there must be strict
proof of the exclusive ownership of one of the spouses, and the burden of proof rests upon the party
asserting it.
Fines and pecuniary indemnities as a general rule should not be enforced upon the conjugal
property. However, if the spouse who is bound should have no exclusive property or if the property
should be insufficient, the fines may be enforced upon the partnership assets. It is just and proper for
respondent to be compensated for the serious physical injuries he suffered.
PROPERTY
Quieting of Title
PHIL-VILLE DEVELOPMENT AND HOUSING CORPORATION v. MAXIMO BONIFACIO, et al.

G.R. No. 167391, 8 June 2011, THIRD DIVISION (Villarama, Jr., J.)
In order that an action for quieting of title may prosper, two requisites must concur: (1) the
plaintiff or complainant has a legal or equitable title or interest in the real property subject of the action;
and (2) the deed, claim, encumbrance, or proceeding claimed to be casting cloud on his title must be
shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal efficacy.
Phil-Ville Development and Housing Corporation is the registered owner of three parcels of
land located in Caloocan City. Said parcels of land form part of the Maysilo Estate originally covered
by Original Certificate of Title (OCT) No. 994.
In 1961, a group composed of Eleuteria Rivera, et al., claiming to be the heirs of Maria de la
Concepcion Vidal, a co-owner of the properties of the Hacienda Maysilo, filed a petition with the Court
of First Instance (CFI) of Rizal. They prayed for the substitution of their names on OCT No. 994 in
place of Maria de la Concepcion Vidal. Said petition was granted by the CFI.
In 1996, Eleuteria Rivera filed a Supplemental Motion for the partition and segregation of
portions of the properties covered by OCT No. 994. The Regional Trial Court (RTC) of Caloocan City
granted said motion.
Thereafter, one Rosauro R. Aquino filed a petition for certiorari contesting said Order of and
impugning the partial partition and adjudication to Eleuteria Rivera of the Maysilo Estate. Meanwhile,
a writ of possession was issued in Eleuteria Rivera’s favor. Accordingly, a Notice to Vacate was served
upon Phil-Ville.
In 1997, the Court of Appeals (CA) granted Aquino’s petition and set aside the RTC’s Order
that granted Eleuteria Rivera’s prayer for partition. The appellate court likewise set aside the Order
and the Writ of Possession.
Nonetheless, Phil-Ville filed a complaint for quieting of title and damages against the
surviving heirs of Eleuteria Rivera Vda. de Bonifacio, who are Maximo R. Bonifacio, et al. The Regional
Trial Court (RTC) ordered the quieting of title and declared Phil-Ville’s title over the land as valid.
The CA reversed the decision.
ISSUE:
Whether or not the title in the name of Eleuteria Rivera constitutes a cloud over Phil-Ville’s
titles over portions of the Maysilo Estate.
RULING:
YES. Quieting of title is a common law remedy for the removal of any cloud upon, doubt, or
uncertainty affecting title to real property. Whenever there is a cloud on title to real property or any
interest in real property by reason of any instrument, record, claim, encumbrance, or proceeding that
is apparently valid or effective, but is, in truth and in fact, invalid, ineffective, voidable, or
unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud
or to quiet the title. In such action, the competent court is tasked to determine the respective rights
of the complainant and the other claimants, not only to place things in their proper places, and make
the claimant, who has no rights to said immovable, respect and not disturb the one so entitled, but
also for the benefit of both, so that whoever has the right will see every cloud of doubt over the
property dissipated, and he can thereafter fearlessly introduce any desired improvements, as well as
use, and even abuse the property.
In order that an action for quieting of title may prosper, two requisites must concur: (1) the
plaintiff or complainant has a legal or equitable title or interest in the real property subject of the
action; and (2) the deed, claim, encumbrance, or proceeding claimed to be casting cloud on his title
must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or
legal efficacy.
As regards the first requisite, Phil-Ville was able to establish its title over the real properties
subject of this action.
The second requisite in an action for quieting of title requires that the deed, claim,
encumbrance, or proceeding claimed to be casting cloud on his title must be shown to be in fact
invalid or inoperative despite its prima facie appearance of validity or legal efficacy.
Thus, the cloud on title consists of: (1) any instrument, record, claim, encumbrance or
proceeding; (2) which is apparently valid or effective; (3) but is in truth and in fact invalid, ineffective,
voidable, or unenforceable; and (4) may be prejudicial to the title sought to be quieted. The fourth
element is not present in the case at bar.
While it is true that TCT No. C-314537 in the name of Eleuteria Rivera is an instrument that
appeared to be valid but was subsequently shown to be invalid, it does not cover the same parcels of
land that are described in Phil-Ville’s titles. Foremost, Rivera’s title embraces a land measuring
14,391.54 square meters while Phil-Ville’s lands has an aggregate area of only 8,694 square
meters. On the one hand, it may be argued that Phil-Ville’s land could be subsumed within Rivera’s
14,391.54-square meter property. Yet, a comparison of the technical descriptions of the parties’ titles
negates an overlapping of their boundaries.
TOP MANAGEMENT PROGRAMS CORPORATION v. LUIS FAJARDO AND THE REGISTER OF

DEEDS OF LAS PIÑAS CITY
Quieting of title is a common law remedy for the removal of any cloud, doubt, or uncertainty
affecting title to real property. In an action for quieting of title, the plaintiffs must show not only that
there is a cloud or contrary interest over the subject real property, but that they have a valid title to it.
Emilio Gregorio (Gregorio) filed an application for the registration of title over the Lot 1-4 of
Plan Psu-204785 situated in Las Piñas, Rizal before the Court of First Instance (CFI) of Rizal. The said
court thereafter issued an order declaring as abandoned the reserved oppositions of Jose Velasquez
on Lots 1-4 and issued a decree of registration. The LRA called the attention of the Director of Lands
regarding the overlapping of Lots 1, 7 and 11 of Psu-56007-Amd awarded to Jose Velasquez and
Pablo Velasquez. Jose Velasquez (Velasquez) filed an application for registration of title over six lots
before the same court. CFI rendered a decision declaring Gregorio the absolute owner, with Lots 1-4
of Psu-204785 adjudicated to Gregorio, and requested that portions of these lots that are not
in conflict be segregated.
Based on the LRA report, Velasquez petitioned the CFI to set aside the award earlier made in
favor of Gregorio in LRC Case No. N-5035 on the ground of lack of jurisdiction and to give due course
to his application over the said lots. CFI issued an Order declaring that the application of Velasquez
be given due course insofar as Lots 1 and 7 of Ap-11135 which are identical to Lots 1 to 4, Plan Psu-
204785 in favor of Gregorio respecting the same lots as null and void. On December 6, 1966, decrees
and certificates of title were issued in favor of Velasquez. Gregorio appealed the decision to the Court
of Appeals (CA), wherein the latter has reversed the decision of the CFI.
Gregorio appealed the November 23, 1966 CFI decision in LRC Case Nos. N-5053 and N-5416
awarding Lots 1 to 4 of Psu-204785 in favor of Velasquez, docketed as CA-G.R. No. 40739-40-
R. Sometime after this, he entered into an agreement with Tomas Trinidad (Trinidad) and Luis
Fajardo (Fajardo) entitled “Kasunduan na may Pambihirang Kapangyarihan.” By virtue of this
agreement, Fajardo would finance the cost of the litigation and in return he would be entitled to one-
half of the subject property after deducting twenty percent (20%) of the total land area as attorney’s
fees for Trinidad if the appeal is successful. After the CA rendered a favorable ruling on Gregorio’s
appeal, Fajardo and Trinidad filed a civil case before the Regional Trial Court (RTC) of Pasig to enforce
their agreement with Gregorio. On May 8, 1986, said court rendered judgment in their favour.
Top Management Programs Corporation (TMPC) sought the annulment of the CFI orders on
the ground of extrinsic fraud. TMPC claimed that by virtue of a Deed of Absolute Sale dated
November 29, 1988 which was notarized on January 9, 1989, the heirs of Gregorio sold to it a parcel
of land with an area of 20,000 sq. ms., located at Las Piñas and identified as Lot 1-A Psd-293076,
being a portion of Lot 1, Psu-204785 covered by TCT No. T-4635, and that on February 20, 1989, TCT
No. T-8129 covering the said property was issued in its name. CA rendered a decision dismissing the
petition for annulment.
ISSUE:
Whether or not TMPC may quiet title and the TCT in favor of Luis Fajardo may be cancelled.
RULING:
NO. Quieting of title is a common law remedy for the removal of any cloud, doubt, or
uncertainty affecting title to real property. In an action for quieting of title, the plaintiffs must show
not only that there is a cloud or contrary interest over the subject real property, but that they have a
valid title to it.
The TCT in the name of the heirs of Emilio Gregorio issued on April 29, 1986, on its face
showed badges of irregularity in its issuance. First, the technical description stated that it covers a
portion of Lot 1, plan Psu-204785, LRC Case No. N-5416 instead of N-5053. Second, the decree
number and date of issuance, as well as OCT number clearly indicate that the original decree
pertained to Velasquez and not Gregorio. Third, the name of the registered owner in the original
certificate is not Velasquez or Gregorio but “Delta Motor Corp.” And fourth, the certificate from which
TCT No. 107729 was supposedly a transfer should have been the OCT and not those unfamiliar TCT
numbers indicated therein.
The foregoing errors are not mere typographical as TMPC claims, but serious discrepancies
in the registration process. TMPC being a mere transferee at the time the decision of the RTC of Pasig
in Civil Case No. 35305 had become final and executory on December 6, 1988, is bound by the said
judgment which ordered the heirs of Emilio Gregorio to convey Lots 1, 2, 3 & 4, Psu-204875 in favor
of private respondent and Trinidad. As such buyer of one of the lots to be conveyed to private
respondent pursuant to the court’s decree with notice that said properties are in litigation, TMPC
merely stepped into the shoes of its vendors who lost in the case. Such vested right acquired by the
private respondent under the final judgment in his favor may not be defeated by the subsequent
issuance of another certificate of title to the heirs of Gregorio respecting the same parcel of land. For
it is well-settled that being an involuntary transaction, entry of the notice of lis pendens in the primary
entry book of the Register of Deeds is sufficient to constitute registration and such entry is notice to
all persons of such claim.
Co-Ownership
BETTY B. LACBAYAN v. BAYANI S. SAMOY, JR.

G.R. No. 165427, 21 March 2011, THIRD DIVISION (Villarama, Jr., J.)
The determination as to the existence of co-ownership is necessary in the resolution of an action

for partition.
Betty B. Lacbayan (Betty) and Bayani S. Samoy, Jr. (Bayani) met through a common friend.
They had an illicit relationship until Betty gave birth to Bayani’s son.
During their illicit relationship, Betty and Bayani established a manpower services company,
together with three more incorporators. Five parcels of land were also acquired during the said
period, and were registered in Betty and Bayani’s name, as husband and wife. Eventually, however,
their relationship turned sour and they decided to part ways. Thereafter, they agreed to divide the
said properties and terminate their business partnership by executing a partition agreement.
However, they failed to agree on which property goes to who.
Hence, Betty filed a complaint for judicial partition of the said properties. The trial court
dismissed the complaint for lack of merit. In resolving the issue of ownership, the trial court gave
weight to Betty’s admission that the properties were acquired not from her personal funds but from
the income of the manpower services company over which she owns a measly 3.33% share.
Aggrieved, Betty elevated the matter to the Court of Appeals (CA). The CA, however, denied the
appeal. Hence, this petition.
ISSUES:
1. Whether or not the issue of ownership may be passed upon in an action for partition.
2. Whether or not Bayani is estopped from repudiating co-ownership over the subject realties.
RULING:
1. YES. While it is true that the complaint involved here is one for partition, the same is
premised on the existence or non-existence of co-ownership between the parties.
Betty insists she is a co-owner pro indiviso of the five real estate properties based on the
transfer certificates of title (TCTs) covering the subject properties. Bayani maintains otherwise.
Indubitably, therefore, until and unless this issue of coownership is definitely and finally resolved, it
would be premature to effect a partition of the disputed properties. More importantly, the complaint
will not even lie if the claimant, or Betty in this case, does not even have any rightful interest over the
subject properties.
2. NO. A careful perusal of the contents of the so-called Partition Agreement indicates that the
document involves matters which necessitate prior settlement of questions of law, basic of which is
a determination as to whether the parties have the right to freely divide among themselves the
subject properties.
Moreover, to follow Betty’s argument would be to allow Bayani not only to admit against his
own interest but that of his legal spouse as well, who may also be lawfully entitled co-ownership over
the said properties. Bayani is not allowed by law to waive whatever share his lawful spouse may have
on the disputed properties. Basic is the rule that rights may be waived, unless the waiver is contrary
to law, public order, public policy, morals, good customs or prejudicial to a third person with a right
recognized by law.
Curiously, Betty herself admitted that she did not assent to the Partition Agreement after
seeing the need to amend the same to include other matters. Betty does not have any right to insist
on the contents of an agreement she intentionally refused to sign.
CO GIOK LUN, et al. v. JOSE CO, et al.

G.R. No. 184454, 3 August 2011, SECOND DIVISION (Carpio, J.)
A division of property cannot be ordered by the court unless the existence of co-ownership is first
established.
The case involves two lots allegedly co-owned by two brothers, petitioner Co Giok Lun (Lun)
and Co Bon Fieng (Fieng), the father of respondent Jose Co (Co) represented by his legal heirs (Heirs
of Co). The lots are situated in Sorsogon province, one in the town of Gubat and the other in the town
of Barcelona. The petitioners are the legal heirs of Lun (Heirs of Lun) who filed a complaint for
partition and damages against Co with the Regional Trial Court (RTC) of Gubat, Sorsogon, Branch 54.
The RTC decided the case in favor of the Heirs of Lun. The RTC stated that the documentary
evidence presented in court showed that the Gubat property is indeed under Fieng’s name. However,
the chain of events prior to the purchase of the property and the evidence submitted by the Heirs of
Lun prove the presence of co-ownership.
On appeal to the Court of Appeals, it reversed the decision of the RTC and ruled in favor of
the Heirs of Co declaring the subject properties exclusively owned by Co Bon Fieng, and now by his
legal heirs. The Heirs of Lun filed a Motion for Reconsideration but the CA denied the same.
ISSUE:
Whether co-ownership existed between Lun and Fieng over the Gubat and Barcelona
properties.
RULING:
NO. The original complaint filed by Lun involves an action for partition and damages. A
division of property cannot be ordered by the court unless the existence of co-ownership is first
established.
In Ocampo v. Ocampo, the Court held that an action for partition will not lie if the claimant has
no rightful interest over the property. Basic is the rule that the party making an allegation in a civil
case has the burden of proving it by a preponderance of evidence.
In the present case, petitioners insist that their predecessor-in-interest Lun co-owned the
Gubat and Barcelona properties with his brother Fieng. To prove co-ownership over the Gubat
property, petitioners presented: (1) tax declarations from 1929 to 1983 under the name of Fieng but
paid by Lun; (2) the renewal certificate from Malayan Insurance Company Inc.; (3) the insurance
contract; and (4) the statements of account from Supreme Insurance Underwriters which named Lun
as administrator of the property. Likewise, to prove their right over the Barcelona property as legal
heirs under intestate succession, petitioners presented a Deed of Sale dated 24 August 1923 between
Chaco, as buyer, and Gabriel Gredona and Engracia Legata, as sellers, involving a price consideration
of P1,200.
On the other hand, respondents presented notarized documents: (1) Deed of Sale dated 13
October 1935, and (2) Sale of Real Property dated 6 August 1936 showing that the former owners of
the Gubat property entered into a sale transaction with Fieng, as buyer and Lun, as a witness to the
sale. They also presented tax declarations in the name of Fieng from 1937 to 1958. After Fiengs death,
Co declared the Gubat property in his name in the succeeding tax declarations. Likewise, the
respondents presented documents proving the declaration of the Barcelona property in the name of
Co.
After a careful scrutiny of the records, the Court holds that the evidence of petitioners were
insufficient or immaterial to warrant a positive finding of co-ownership over the Gubat and Barcelona
properties. The CA correctly observed that petitioners failed to substantiate with reasonable
certainty that (1) Chaco gave Fieng a start-up capital of P8,000 to be used by Lun and Fieng in setting
up a business, (2) that the Philippine Honest and Company was a partnership between Lun and Fieng,
and (3) that the Deed of Sale dated 24 August 1923 involving the Barcelona property is sufficient to
establish co-ownership. Also, petitioners were not able to prove the existence of the alleged Chinese
custom of placing properties in the name of the eldest child as provided under Article 12 of the Civil
Code.
In contrast, respondents were able to show documents of sale from the original owners of the
Gubat property rendering the claim of custom as immaterial. Also, respondents sufficiently
established that Fieng was the registered owner of the Gubat and Barcelona properties while Lun
was merely an administrator.
Easement
MARGARITA F. CASTRO v. NAPOLEON A. MONSOD

An easement or servitude is an encumbrance imposed upon an immovable for the benefit of

another immovable belonging to a different owner. The courts cannot impose or constitute any
servitude where none existed. There are therefore no judicial easements.
Margarita is the registered owner of a parcel of land located on Las Piñas City. Napoleon
Monsod on the other hand is the owner of the property adjoining the lot of Castro. There is a concrete
fence, more or less two meters high, dividing the properties. Monsod caused the annotation of an
adverse claim against 65 sq.m. of the property of Castro. The adverse claim was filed without any
claim of ownership over the property. Monsod was merely asserting the existing legal easement of
lateral and subjacent support at the rear portion of his estate to prevent the property from collapsing,
since his property is located at an elevated plateau of 15 feet, more or less, above the level of Castro’s
property. Monsod also filed a complaint for malicious mischief and malicious destruction before the
office of the barangay chairman. In defiance, Castro filed a complaint for damages with temporary
restraining order/writ of preliminary injunction before the Regional Trial Court (RTC).
ISSUE:
Whether or not the easement of lateral and subjacent support exists on the subject adjacent
properties.
RULING:
YES. An easement or servitude is an encumbrance imposed upon an immovable for the

benefit of another immovable belonging to a different owner. There are two kinds of easements
according to source. An easement is established either by law or by will of the owners. The courts
cannot impose or constitute any servitude where none existed. They can only declare its existence if
in reality it exists by law or by the will of the owners. There are therefore no judicial easements.
In the instant case, an easement of subjacent and lateral support exists in favor of Monsod. It was
established that the properties of Castro and Monsod adjoin each other. The residential house and
lot of Monsod is located on an elevated plateau of 15 feet above the level of Castro’s property. The
embankment and the riprapped stones have been in existence even before Castro became the owner
of the property. It was proven that Castro has been making excavations and diggings on the subject
embankment and, unless restrained, the continued excavation of the embankment could cause the
foundation of the rear portion of the house of Monsod to collapse, resulting in the destruction of a
huge part of the family dwelling.
A permanent injunction on the part of Castro from making injurious excavations is necessary
in order to protect the interest of Monsod. However, an annotation of the existence of the subjacent
and lateral support is no longer necessary. It exists whether or not it is annotated or registered in the
registry of property. A judicial recognition of the same already binds the property and the owner of
the same, including her successors-in-interest. Otherwise, every adjoining landowner would come to
court or have the easement of subjacent and lateral support registered in order for it to be recognized
and respected.
CRISPIN DICHOSO, JR., et al. v. PATROCINIO L. MARCOS

G.R. No. 180282 11 April 2011, SECOND DIVISION (Nachura, J.)
The convenience of the dominant estate has never been the gauge for the grant of compulsory
right of way. To be sure, the true standard for the grant of the legal right is “adequacy.”
Crispin Dischoso, Jr., et al. (the Dichosos) filed a complaint for easement of right of way
against Patrocinio L. Marcos (Marcos). Dichoso, Jr., et al. alleged that they are the owners of a parcel
of lot which has no access to a public road to and from their property. Marcos, on the other hand, is
the owner of Lot No. 1 near the Dichosos’ lot. The Dichosos claimed that they have used a portion of
Lot No. 1 in accessing the road since 1970. Marcos, however, blocked the passageway with piles of
sand. It must be noted that the Dichosos have been previously granted another passageway by the
Spouses Arce, the owners of another adjacent lot.
The trial court granted the easement of right of way in favor of the Dichosos. On appeal, the
Court of Appeals (CA) reversed and set aside the trial court’s decision. Hence, the Dichosos filed the
instant petition before the Supreme Court.
ISSUE:
Whether or not the Dichosos are entitled to a legal easement of right of way.
RULING:
NO. Admittedly, the Dichosos had been granted a right of way through the other adjacent lot
owned by the Spouses Arce. In fact, other lot owners use the said outlet in going to and coming from
the public highway. Clearly, there is an existing outlet to and from the public road.
However, the Dichosos claim that the outlet is longer and circuitous, and they have to pass
through other lots owned by different owners before they could get to the highway.
The Court found the Dichosos’ concept of what is “adequate outlet” a complete disregard of
the well-entrenched doctrine that in order to justify the imposition of an easement of right of way,
there must be real, not fictitious or artificial, necessity or it. Mere convenience for the dominant estate
is not what is required by law as the basis of setting up a compulsory easement. Even in the face of
necessity, if it can be satisfied without imposing the easement, the same should not be imposed.
The convenience of the dominant estate has never been the gauge for the grant of compulsory
right of way. To be sure, the true standard for the grant of the legal right is “adequacy.” Hence, when
there is already an existing adequate outlet from the dominant estate to a public highway, as in this
case, even when the said outlet, for one reason or another, be inconvenient, the need to open up
another servitude is entirely unjustified.
Prescription
GONZALO VILLANUEVA v. SPOUSES FROILAN AND LEONILA BRANOCO

G.R. No. 172804, 24 January 2011 SECOND DIVISION (Carpio, J.)
The ten year ordinary prescriptive period to acquire title through possession of real property in
the concept of an owner requires uninterrupted possession coupled with just title and good faith. There
is just title when the adverse claimant came into possession of the property through one of the modes
recognized by law for the acquisition of ownership or other real rights, but the grantor was not the
owner or could not transmit any right.
Gonzalo Villanueva sued Spouses Froilan in order to recover a parcel of land in their
possession. Villanueva avers that he gained ownership over the property when he purchased the land
from a third person. As proof, Villanueva presented the payment of taxes of the disputed land made
in his name. On the other hand, spouses Froilan also puts forward the payment of taxes and lawful
possession and entry of the property. The Regional Trial Court (RTC) resolved in favor of Gonzalo
Villanueva and ordered the surrender of property to Villanueva. The trial court rejected Spouses
Branoco’s claim of ownership after treating the Deed as a donation mortis causa which Rodrigo
effectively cancelled by selling the property to Vere. Thus, by the time Rodriguez sold the property
to the Spouses, she had no title to transfer.
On appeal, the Court of Appeals (CA) granted the Spouses’ appeal and set aside the trial
court's ruling. It held that the deed of donation is one of inter vivos. In his petition, Gonzalo seeks
the reinstatement of the trial court's ruling. As a consequence, the heirs of Villanueva interposed the
claim that he has acquired the property through acquisitive prescription having possessed the
property for more than ten (10) years.
ISSUE:
Whether or not Villanueva holds a superior title over the property than Spouses Froilan and
Branoco.
RULING:
NO. The ten year ordinary prescriptive period to acquire title through possession of real
property in the concept of an owner requires uninterrupted possession coupled with just
title and good faith. There is just title when the adverse claimant came into possession of the property
through one of the modes recognized by law for the acquisition of ownership or other real rights, but
the grantor was not the owner or could not transmit any right.
In the instant case however, it was proven that Villanueva when there was a conflict
regarding the deed of sale that was executed she entered and possessed the property under the
pretense of being the lawful owner. Lacking good faith possession, the only other legal recourse is to
prove that there has been open, continuous, exclusive, and notorious possession for thirty (30) years
which is not proven in the instant case.
JAMIE ABALOS and SPOUSES FELIX SALAZAR AND CONSUELO SALAZAR v. HEIRS OF VICENTE
TORIO
G.R. No. 175444, 14 December 2011, THIRD DIVISION (Brion, J.)
Ordinary acquisitive prescription requires possession in good faith and with just title for ten
(10) years. Without good faith and just title, acquisitive prescription can only be extraordinary in
character which requires uninterrupted adverse possession for thirty (30) years.
The Heirs of Vicente Torio (Heirs of Vicente) filed a Complaint for Recovery of Possession and
Damages with the Municipal Trial Court (MTC) against Jamie Abalos (Abalos) and the Spouses Felix
and Consuelo Salazar (Spouses Salazar). According to them, they are the heirs of Vicente Torio
(Vicente) and that the latter left behimnd a parcel of land measuring 2,950 square meters. During
Vicente's lifetime and through his tolerance, Abalos and Spouses Salazar were allowed to stay and
build their respective houses on the subject parcel of land. However, circumstances changed when,
in 1985, the Heirs of Vicente asked them to vacate the subject lot. They refused to as they requested,
prompting the Heirs of Vicente to file the present complaint.
Abalos and the Spouses Salazar denied the material allegations raised by the Heirs of Vicente.
Aside from their specific denial, they added that the latter's cause of action is barred by acquisitive
prescription, and that they have been in actual, continuous, and peaceful possession of the subject lot
as owners since time immemorial, as evidenced by the Real Property Tax Receipts. In the Tax Receipt
of Abalos, it was indicated that his house was built on Vicente’s land.
The Municipal Trial Court (MTC) ruled in favor of the Heirs of Vicente. The Regional Trial
Court (RTC) reversed the MTC's judgment, and held that Abalos and the Spouses Salazar have
acquired the property through prescription. The Court of Appeals (CA), finding for the Heirs of
Salazar, reinstated the MTC's decision.
ISSUE:
Whether Abalos and the Spouses Salazar have possessed the disputed lot in the concept of an
owner.
RULING:
NO. Ordinary acquisitive prescription requires possession in good faith and with just title for
ten (10) years. Without good faith and just title, acquisitive prescription can only be extraordinary in
character which requires uninterrupted adverse possession for thirty (30) years. Possession “in good
faith” consists in the reasonable belief that the person from whom the thing is received has been the
owner thereof, and could transmit his ownership. There is “just title” when the adverse claimant
came into possession of the property through one of the modes recognized by law for the acquisition
of ownership or other real rights, but the grantor was not the owner or could not transmit any right.
In this case, it is clear that, during their possession of the property, Abalos and Spouses
Salazar have acknowledge the ownership of Vicente, as shown by the Tax Declaration, in which it was
admitted that Abalos’ house was built on the land of Vicente. Therefore, having knowledge of the
same, they could not be deemed as possessors in good faith for them to acquire the property through
ordinary prescription.
OBLIGATIONS
HEIRS OF RAMON GAITE v. THE PLAZA, INC.,

G.R. No. 177685, 26 January 2011 THIRD DIVISION (Villarama, J.)
Article 1170 of the New Civil Code provides that whoever is guilty of fraud, negligence, delay,
and those who in any manner contravenes the tenor of the obligation shall be liable for damages.
The Plaza, Inc., a corporation engaged in restaurant business, engaged into a contract with
Rhogen Builders for the construction of a building in Greenbelt, Makati for the price of 7,600,000.
The former paid the price of downpayment to the latter for it to start operating on the construction
of the building.
Two (2) months later, the Building Official of Makati City ordered the stoppage of the
construction of the building since it violated the National Building Code. The Project Manager of Plaza
Inc. conducted an ocular of the progress of the building and found a notable disparity between the
reports submitted by Rhogen Builders and the actual work. As such, Plaza Inc. stated that since what
is ordered falls short of the job order, it only paid part of the amount being demanded by Rhogen.
Plaza Inc. subsequently ordered a suspension of all construction activities until all issues have
been dealt with by the construction firm. After some time, Plaza Inc. decided to terminate the contract
and sought to be compensated due to the negligence done by Rhogen Builders for which they have
incurred undue damage.
ISSUE:
Whether or not Plaza Inc. must be awarded damages due to Rhogen Builders’ fault.
RULING:
YES. Article 1170 of the New Civil Code provides that whoever is guilty of fraud, negligence,
delay, and those who in any manner contravenes the tenor of the obligation shall be liable for
damages. Rhogen Builders cannot justify that they did not commit fault or negligence since they have
already violated the law when it does not meet the standards set by the National Building Code. By
not following the standards set by law which is read into every contract, it prejudices the interest and
investment of Plaza Inc. and thus violates the agreement being contemplated.
Default
GENERAL MILLING CORPORATION v. SPS. LIBRADO RAMOS and REMEDIOS RAMOS

G.R. No. 193723, 20 July 2011, THIRD DIVISION (Velasco, Jr., J.)
Foreclosure is valid only when the debtor is in default in the payment of his obligation.
General Milling Corporation (GMC) entered into a Growers Contract with spouses Librado
and Remedios Ramos (Spouses Ramos), who mortgaged their real property to guarantee full
compliance. When Spouses Ramos failed to settle their account, GMC initiated foreclosure
proceedings wherein the property subject of the foreclosure was sold by public auction to GMC after
the required posting and publication. Thus, Spouses Ramos sought to nullify the extrajudicial
foreclosure sale as it was null and void for not complying with the requirements of posting and
publication of notices under Act No. 3135. GMC argued that it repeatedly reminded Spouses Ramos
of their liabilities under the Growers Contract and that it was compelled to foreclose the mortgage
because of Spouses Ramos’ failure to pay their obligation.
The Regional Trial Court (RTC) ruled in favor of Spouses Ramos and held that the action of
GMC in moving for the foreclosure of the spouses’ properties was premature, because the latter’s
obligation under their contract was not yet due. The Court of Appeals (CA) affirmed.
ISSUE:
Whether or not the Spouses Ramos were in default of their obligation to GMC.
RULING:
NO. There are three requisites necessary for a finding of default. First, the obligation is
demandable and liquidated; second, the debtor delays performance; and third, the creditor judicially
or extrajudicially requires the debtor’s performance. According to the CA, GMC did not make a
demand on Spouses Ramos but merely requested them to go to GMC’s office to discuss the settlement
of their account. In spite of the lack of demand made on the spouses, however, GMC proceeded with
the foreclosure proceedings. Neither was there any provision in the Deed of Real Estate Mortgage
allowing GMC to extrajudicially foreclose the mortgage without need of demand.
Indeed, Article 1169 of the Civil Code on delay requires the following: “Those obliged to
deliver or to do something incur in delay from the time the obligee judicially or extrajudicially
demands from them the fulfillment of their obligation. However, the demand by the creditor shall not
be necessary in order that delay may exist: (1) When the obligation or the law expressly so declares;
x x x”. As the contract in the instant case carries no such provision on demand not being necessary
for delay to exist, the Court agrees with the appellate court that GMC should have first made a demand
on the spouses before proceeding to foreclose the real estate mortgage.
Development Bank of the Philippines v. Licuanan finds application to the instant case: “The
issue of whether demand was made before the foreclosure was effected is essential. If demand was
made and duly received by the respondents and the latter still did not pay, then they were already in
default and foreclosure was proper. However, if demand was not made, then the loans had not yet
become due and demandable. This meant that respondents had not defaulted in their payments and
the foreclosure by petitioner was premature. Foreclosure is valid only when the debtor is in default
in the payment of his obligation.”
Solidary Obligations
JAPRL DEVELOPMENT CORP., et al. v. SECURITY BANK CORPORATION

G.R. No. 190107, 06 June 2011, THIRD DIVISION (Carpio Morales, J.)
The creditor may proceed against any one of the solidary debtors or some or all of them
simultaneously. The demand made against any one of them shall not be an obstacle to those which may
subsequently be directed against the others, so long as the debt has not been fully collected.
JAPRL Development Corporation (JAPRL), a domestic corporation engaged in fabrication,

manufacture and distribution of steel products, applied for a credit facility in the amount of Fifty
Million (P50,000,000) Pesos with Security Bank Corporation (SBC). The application was approved
and the Credit Agreement took effect on July 15, 1996.
On November 5, 2001, Peter Rafael C. Limson (Limson) and Jose Uy Arollado (Arollado),
JAPRL Chairman and President, respectively, executed a Continuing Suretyship Agreement (CSA) in
favor of SBC wherein they guaranteed the due and full payment and performance of JAPRL’s
guaranteed obligations under the credit facility. SBC soon discovered material inconsistencies in the
financial statements given by MRM (JAPRL’s financial adviser) vis-a-vis those submitted by JAPRL
when it applied for a credit facility, drawing SBC to conclude that JAPRL committed
misrepresentation. On the basis of the CSA, SBC sent a formal letter of demand dated August 20, 2003
to JAPRL, Limson and Arollado for the immediate payment of P43,926,021.41 representing JAPRL’s
outstanding obligations.
They failed to comply with SBC’s demand, hence, SBC filed a complaint for sum of money with
application for issuance of writ of preliminary attachment. Because there was a pending petition for
rehabilitation of JAPRL in another court, the Makati RTC at once ordered in open court the archiving
of SBC’s complaint for sum of money until disposition by the Quezon City RTC of JAPRL’s petition for
rehabilitation.
SBC moved to clarify the Makati RTC January 9, 2004 Order, positing that the suspension of
the proceedings should only be with respect to JAPRL but not with respect to Limson and Arollado.
The Makati RTC, by Order of February 25, 2004, maintained its order archiving the complaint.
ISSUE:
Whether or not Limson and Arollado, in their capacity as sureties, are covered by the
suspension of proceedings against a corporation in the process of rehabilitation.
RULING:
NO. According to Article 1216 of the Civil Code, the creditor may proceed against any one of
the solidary debtors or some or all of them simultaneously. The demand made against any one of
them shall not be an obstacle to those which may subsequently be directed against the others, so long
as the debt has not been fully collected. In the case of Banco de Oro-EPCI, Inc. v. JAPRL Development
Corporation, the Court holds that a creditor can demand payment from the surety solidarily
liable with the corporation seeking rehabilitation, it being not included in the list of stayed claims.
In the case at bar, Limson and Arollado, as sureties, whose liability is solidary cannot,
therefore, claim protection from the rehabilitation court, they not being the financially-distressed
corporation that may be restored, not to mention that the rehabilitation court has no jurisdiction
over them. Hence, SBC can pursue its claim against Limson and Arollado despite the pendency of
JAPRL’s petition for rehabilitation. For, by the CSA in favor of SBC, it is the obligation of the sureties,
who are therein stated to be solidary with JAPRL, to see to it that JAPRL’s debt is fully paid.
Obligations with a Penal Clause
CONTINENTAL CEMENT CORPORATION v. ASEA BROWN BOVERI, INC., BBC BROWN BOVERI,
CORP., AND TORD B. ERIKSSON
G.R. No. 171660, October 17, 2011, FIRST DIVISION (Del Castillo, J.)
Under Article 1226 of the Civil Code, the penalty clause takes the place of indemnity for damages and the
payment of interests in case of non-compliance with the obligation, unless there is a stipulation to the contrary
and that if the obligor refuses to pay the penalty, damages and interests may still be recovered on top of the
penalty.
Continental Cement Corporation (CCC) obtained the services of Asea Brown Boveri, Inc.
(ABB) and BBC Brown Boveri, Corp. (BBC) to repair its Kiln Drive Motor. Due to the repeated failure
of ABB and BCC to repair the Kiln Drive Motor, CCC filed a complaint against ABB, BCC and Tord B.
Eriksson (Eriksson), Vice-President of the Service Division of the ABB. ABB, BCC and Eriksson
claimed that under Clause 7 of the General Conditions, attached to the letter of offer issued by ABB
to CCC, the liability of ABB does not extend to consequential damages either direct or indirect.
Moreover, as to Eriksson, there is no lawful and tenable reason for CCC to sue him in his personal
capacity because he did not personally direct the repair of the Kiln Drive Motor.
ISSUE:
Whether or not the General Conditions should exculpate ABB, BCC and Eriksson from liability.
RULING:
NO. Having breached the contract it entered with CCC, ABB is liable for damages pursuant to
Articles 1167, 1170, and 2201 of the Civil Code. Based on the foregoing, a repairman who fails to
perform his obligation is liable to pay for the cost of the execution of the obligation plus damages.
Though entitled, CCC in this case is not claiming reimbursement for the repair allegedly done, but is
instead asking for damages for the delay caused by ABB.
Also, under Article 1226 of the Civil Code, the penalty clause takes the place of indemnity for
damages and the payment of interests in case of non-compliance with the obligation, unless there is
a stipulation to the contrary. In this case, since there is no stipulation to the contrary, the penalty for
delay covers all other damages (i.e. production loss, labor cost, and rental of the crane) claimed by
CCC. Article 1226 further provides that if the obligor refuses to pay the penalty, such as in the instant
case, damages and interests may still be recovered on top of the penalty. Damages claimed must be
the natural and probable consequences of the breach, which the parties have foreseen or could have
reasonably foreseen at the time the obligation was constituted. Thus, in addition to the penalties,
petitioner seeks to recover as damages production loss, labor cost and the rental of the crane.
Extinguishment of Obligations
DELTA DEVELOPMENT AND MANAGEMENT SERVICES, INC. v. ANGELES CATHERINE

ENRIQUEZ, et al.
G.R. No. 168666, 12 January 2011 FIRST DIVISION (Del Castillo, J.)
Dacion en pago extinguished the obligation to the extent it was stipulated unless either by
express or implied stipulation, it shall serve as the full payment.
Delta Management Services, Inc. (DELTA) which is owned by Ricardo De Leon, is a
corporation engaged in the trade of developing and selling real estate properties loaned from Luzon
Development Bank (LDB) for the development of Delta Homes. Spouses De Leon obtained a loan from
the bank wherein it is secured by a real estate mortgage over a number of their properties.
In 1997, DELTA executed a Contract to Sell with Angela Catherine Enriquez (Enriquez) over
the disputed land that was mortgaged by the De Leons, wherein the downpayment was paid by
Enriquez. DELTA subsequently defaulted in its obligations to the bank. Instead of foreclosing the
mortgaged properties however, the bank offered a dacion en pago.
A Deed of Assignment was executed between DELTA and LDB which transfers and conveys
certain properties of the former to the latter. It was however unknown to Enriquez that the property
she has an interest in is included in the deed of Assignment as the document is silent as to which
properties are excluded from the agreement between the two.
ISSUE:
Whether or not the dacion en pago extinguished the obligation of DELTA to the bank.
RULING:
YES. Dacion en pago extinguished the obligation to the extent it was stipulated unless either
by express or implied stipulation, it shall serve as the full payment. It is shown in this case that the
agreement entered into between the parties contemplates the extinguishment of the obligation when
it is not made with any condition or reservation.
Consignation
SOLEDAD DALTON v. FGR REALTY AND DEVELOPMENT CORPORATION, et al.

Consignation is completed at the time the creditor accepts the same without objections, or, if he
objects, at the time the court declares that it has been validly made in accordance with law. In addition,
all the requisites must be complied with for consignation to be valid. Hence, failure to notify the persons
interested in the performance of the obligation will render the consignation void.
Flora R. Dayrit (Dayrit) owned a parcel of land. Soledad Dalton (Dalton), Clemente Sasam,
Romulo Villalonga, Miguela Villarente, Aniceta Fuentes, Perla Pormento, Bonifacio Cabajar,
Carmencita Yuson, Angel Ponce, Pedro Regudo, Pedro Quebedo, Mary Cabanlit, Marciana Ancabo and
Dolores Lim (Sasam, et al.) leased portions of the property. Dayrit sold the property to FGR Realty
and Development Corporation (FGR). Dayrit and FGR stopped accepting rental payments because
they wanted to terminate the lease agreements with Dalton and Sasam, et al. In a complaint, Dalton
and Sasam, et al. consigned the rental payments with the Regional Trial Court. They failed to
notify Dayrit and FGR about the consignation. In motions, Dayrit and FGR withdrew the rental
payments. In their motions, Dayrit and FGR reserved the right to question the validity of the
consignation. Dayrit, FGR and Sasam, et al. entered into compromise agreements. In the compromise
agreements, they agreed to abandon all claims against each other. Dalton did not enter into a
compromise agreement with Dayrit and FGR. The RTC dismissed the complaint and ordered Dalton
to vacate the property. Dalton appealed to the Court of Appeals. The Court of Appeals affirmed the
RTC’s Decision.
ISSUE:
Whether the issue of valid consignation for lack of notice has already been rendered moot
and academic with the withdrawal by the Dayrit and FGR of the amounts consigned and deposited as
rental of the subject premises.
RULING:
NO. First, in withdrawing the amounts consigned, Dayrit and FGR expressly reserved the
right to question the validity of the consignation. Second, compliance with the requisites of a valid
consignation is mandatory. Failure to comply strictly with any of the requisites will render the
consignation void. Substantial compliance is not enough. In Insular Life Assurance Company, Ltd. v.
Toyota Bel-Air, Inc., the Court enumerated the requisites of a valid consignation: (1) a debt due; (2)
the creditor to whom tender of payment was made refused without just cause to accept the payment,
or the creditor was absent, unknown or incapacitated, or several persons claimed the same right to
collect, or the title of the obligation was lost; (3) the person interested in the performance of the
obligation was given notice before consignation was made; (4) the amount was placed at the disposal
of the court; and (5) the person interested in the performance of the obligation was given notice after
the consignation was made.
The giving of notice to the persons interested in the performance of the obligation is
mandatory. Failure to notify the persons interested in the performance of the obligation will render
the consignation void.
Compensation
JESUS M. MONTEMAYOR v. VICENTE D. MILLORA

Compensation shall take place when two persons, in their own right, are creditors and debtors
of each other.
Atty. Vicente D. Millora (Vicente) obtained a loan from Dr. Jesus M. Montemayor (Jesus). The
parties stipulated that the loan has a monthly interest of 2% which was later increased to 3.5%.
Vicente was able to pay at first, but later defaulted. Jesus made several demands for Vicente to settle
his obligation but to no avail. Thus, Jesus filed a Complaint for Sum of Money against Vicente before
the Regional Trial Court (RTC). Vicente filed his counterclaim for attorney’s fees, claiming that he
handled several cases for Jesus but he was summarily dismissed from handling them when the
instant complaint for sum of money was filed.
The RTC ordered Vicente to pay Jesus his monetary obligation. At the same time, it found
merit in Vicente’s counterclaim and thus ordered Jesus to pay Vicente his attorney’s fees which is
equivalent to the amount of Vicente’s monetary liability, and which shall be set-off with the amount
Vicente is adjudged to pay Jesus. The RTC denied Vicente’s Motion for Reconsideration but granted
his Motion for Issuance of a Writ of Execution of the portion of the decision concerning the award of
attorney’s fees. Vicente filed a Notice of Appeal with respect to the portion of the RTC Decision which
declared him liable to Jesus, but it was denied by the RTC on the ground that the Decision has already
become final and executory. The Court of Appeals (CA) affirmed.
ISSUE:
Whether or not despite the absence of a specific amount in the RTC Decision representing
Vicente’s counterclaim, the same could be validly offset against the specific amount of award
mentioned in the Decision in favor of Jesus.
RULING:
YES. For legal compensation to take place, the requirements set forth in Articles 1278 and
1279 must be present. A debt is liquidated when its existence and amount are determined. It is not
necessary that it be admitted by the debtor. Nor is it necessary that the credit appear in a final
judgment in order that it can be considered as liquidated; it is enough that its exact amount is known.
In the instant case, both obligations are liquidated. Vicente has the obligation to pay his debt
due to Jesus in the amount of P300,000.00 with interest at the rate of 12% per annum counted from
the filing of the instant complaint on August 17, 1993 until fully paid. Jesus, on the other hand, has
the obligation to pay attorney’s fees which the RTC had already determined to be equivalent to
whatever amount recoverable from Vicente. The said attorney’s fees were awarded by the RTC on
the counterclaim of Vicente on the basis of quantum meruit for the legal services he previously
rendered to Jesus.
It is therefore clear that in the execution of the RTC Decision, there are two parts to be
executed. The first part is the computation of the amount due to Jesus. This is achieved by doing a
simple arithmetical operation at the time of execution. The principal amount of P300,000.00 is to be
multiplied by the interest rate of 12%. The product is then multiplied by the number of years that
had lapsed from the filing of the complaint on August 17, 1993 up to the date when the judgment is
to be executed. The result thereof plus the principal of P300,000.00 is the total amount that Vicente
must pay Jesus.
The second part is the payment of attorney’s fees to Vicente. This is achieved by following the
clear wordings of the fallo of the RTC Decision which provides that Vicente is entitled to attorney’s
fees which is equivalent to whatever amount recoverable from him by Jesus. Therefore, whatever
amount due to Jesus as payment of Vicente’s debt is equivalent to the amount awarded to the latter
as his attorney’s fees. Legal compensation or set-off then takes place between Jesus and Vicente and
both parties are on even terms such that there is actually nothing left to execute and satisfy in favor
of either party.
Novation: Subrogation
REPUBLIC FLOUR MILLS CORPORATION v. FORBES FACTORS, INC.

G.R. No. 152313, October 19, 2011, SECOND DIVISION (Sereno, J.)
Legal subrogation is an equitable doctrine and arises by operation of the law, without any
agreement to that effect executed between the parties
Forbes Factors, Inc. (Forbes) was appointed as the exclusive Philippine indent representative
of Richco Rotterdam B.V. (Richco) in the sale of the latter’s commodities. Under a contract entered
into by them, Forbes was to assume the liabilities of all the Philippine buyers, should they fail to
honor the commitments on the discharging operations of each vessel, including the payment of
demurrage and other penalties. Richco shall have the option to debit the account of Forbes
corresponding to the liabilities of the buyers, and Forbes shall be deemed to be subrogated to all the
rights of Richco against these defaulting buyers. Republic Flour Mills Corporation (RFMC) purchased
Canadian barley and soybean meal from Richco, and the latter chartered four vessels to transport the
products to the Philippines. Each was covered by a contract of sale, which specifically referred to the
charter party in determining demurrage or dispatch rate. The contract also provided that RFMC
guarantees to settle any demurrage due within one month from Forbes’ presentation of the
statement. Upon the delivery of the products, RFMC failed to discharge the cargoes from the four
vessels, thus, it incurred a demurrage. Forbes demanded the payment of the demurrage, but to no
avail. Richco then informed Forbes that the demurrage due from RFMC had been debited from
Forbes’ account. Forbes then filed a complaint against RFMC, but the latter raised the defense that
the delay was due to Forbes’ inefficiency in unloading the cargo. The Regional Trial Court (RTC) ruled
in favor of Forbes, which was affirmed by the Court of Appeals (CA), but awarded exemplary damages
and attorney’s fees in favor of Forbes.
ISSUES:
1. Whether or not Forbes has the right to demand payment of demurrage from RFMC.
2. Whether or not RFMC is liable for exemplary damages and attorney’s fees.
RULING:
1. YES. Subrogation is either legal or conventional. Legal subrogation is an equitable doctrine and
arises by operation of the law, without any agreement to that effect executed between the parties;
conventional subrogation rests on a contract, arising where an agreement is made that the person
paying the debt shall be subrogated to the rights and remedies of the original creditor. The case at
bar is an example of legal subrogation, RFMC and Forbes having no express agreement on the right
of subrogation. Thus, it is of no moment that the Contracts of Sale did not expressly state that
demurrage shall be paid to Forbes. By operation of law, Forbes has become the real party-in-interest
to pursue the payment of demurrage.
2. YES. RFMC refused to honor the contract despite Forbes’ repeated demands and its proof of
payment to Richco; and despite its repeated promise to settle its outstanding obligations in the span
of almost five years. RFMC indeed acted in a wanton, fraudulent, reckless, oppressive or malevolent
manner. Because Forbes was also forced to initiate the complaint, it was only proper that it was
awarded attorney’s fees. Lastly, the CA was correct in reducing the award of exemplary damages or
attorney’s fees, since neither is meant to enrich anyone.
CONTRACTS
Mutuality of Contracts
ROLANDO T. CATUNGAL, et al. v. ANGEL S. RODRIGUEZ

G.R. No. 146839, 23 March 2011, FIRST DIVISION (Leonardo-De Castro, J.)
When the fulfillment of the condition depends upon the sole will of the debtor, the conditional
obligation shall be void. If it depends upon chance or upon the will of a third person, the obligation shall
take effect in conformity with the provisions of the Civil Code.
On December 10, 1990, a complaint for damages and injunction with Preliminary Injunction/
Temporary Restraining Order was filed by Angel S. Rodriguez (Angel) with the RTC, against the
spouses Agapita and Jose Catungal, parents of the petitioners. In the aforementioned complaint, it
was alleged that Agapita owned a parcel of land with an area of 65, 426 square meters situated in the
Barrio of Talamban, Cebu City. The said property was said to be the exclusive paraphernal property
of Agapita. On April 23, 1990, Agapita, with the consent of her husband Jose, entered into a Contract
to Sell with Angel Rodriguez. Subsequently, the Contract to Sell was upgraded into a Conditional Deed
of Sale dated July 26, 1990 between the same parties. Both the Contract to Sell and the Conditional
Deed of Sale were annotated on the title. The value of the said land was P25 Million and Rodriguez
paid the Catungals P500,000 as down payment. The pertinent provision in the Conditional Deed of
Sale states the condition that the vendee has successfully negotiated, secured and provided Road
Right of Way and that the vendee will bear the necessary expenses in order to secure the road. If the
respondent fails to do so, he must inform the spouses Catungal in order to reassess and solve the
problems. The vendee also has the option to rescind the sale.
In accordance to the Conditional Deed of Sale, Angel secured the necessary plans and surveys
and he also actively negotiated for the road right of way. Rodriguez claims that the Catungals
demanded an advance of P5 Million, which was not due under the terms of their agreement. After his
refusal to pay the advance, Rodriguez has learned that the Catungals were offering the property for
sale to third parties. Rodriguez received three letters from Atty. Jose Catungal, dated October 22,
1990, October 24, 1990, and October 29, 1990, essentially telling Rodriguez to make up his mind
about buying the land or to exercise his option to buy. Atty. Catungal also stated in the letter that
should Rodriguez fail to exercise his option to buy, they would consider the contract cancelled.
Rodriguez refused to give in to the demands. On November 15, 1990, Rodriguez received a letter
stating that the contract has been cancelled and terminated.
On January 30, 1991, the trial court ordered the issuance of the writ of preliminary injunction.
On February 1,1991, the spouses Catungal filed their answer with counterclaim alleging that they
had the right to rescind and his refusal to pay the advance was an indication that he lacked the
necessary funds to purchase the property. The Catungals also contended that Rodriguez did not have
an exclusive right to rescind the contract, it being reciprocal in nature and thus susceptible of
rescission by both parties. On the pre-trial held on December 20, 1991, the trial court denied in open
court the Catungals motion to dismiss. Atty. Catungal refused to enter into pre-trial which prompted
the court to declare the Catungals in default and to set the presentation of evidence on February 14,
1992.
On February 28, 1992, the Catungals filed a petition for Certiorari and prohibition with the
Court of Appeals, questioning the denial of the motion to dismiss and the order of default. Meanwhile,
Rodriguez proceeded to present evidence before the trial court. On May 30, 1992, the trial court
decided in favor of Rodriguez. The trial court found the Catungals guilty of misrepresentation, that
Rodriguez has diligently done his duty to fulfill the condition, that the Conditional Deed of Sale was
clear when it gave Rodriguez the right to rescind, and that the Catungals rescission had no basis. The
Catungals appealed the decision to the Court of Appeals. On August 8, 2000, the Court of Appeals
affirmed the decision of the trial court.
ISSUE:
Whether or not the Conditional Deed of Sale violated the principle of mutuality of contracts
under Article 1308 of the Civil Code.
RULING:
NO. A distinction must be made between a condition that is necessary for the perfection of a
contract and a condition imposed upon the performance of an obligation. The condition, as provided
for in the deed of sale, is imposed only on the obligation of Rodriguez to pay the remainder of the
purchase price. The controlling provision is not Article 1308, rather it is Article 1182. The condition
present is not a potestative condition since the creation of the road right of way is not solely
dependent upon the will of Rodriguez, but also on the will of third persons who own the adjacent
land. Under the purview of Article 1182 of the Civil Code, this type of condition is allowed by law.
The case is similar to the case of Romero v. Court of Appeals, wherein the court found that the
condition in a deed of sale that the balance of the purchase price will be paid when the vendor has
successfully ejected the informal settlers in the lot is not a potestative condition dependent solely
upon the will of the debtor.
PHILIPPINE SAVINGS BANK v. SPOUSES ALFREDO M. CASTILLO AND ELIZABETH C. CASTILLO,

et al.
G.R. No. 193178, 30 May 2011, SECOND DIVISION (Nachura, J.)
The unilateral determination and imposition of the increased rates is violative of the principle
of mutuality of contracts under Article 1308 of the Civil Code.
Spouses Alfredo and Elizabeth Castillo, et al. (Spouses Castillo, et al.) obtained a loan with face
value of P2,500,000.00 and 17% interest rate per annum from Philippine Savings Bank (PSB) with
real estate mortgage over lots they owned in Tondo, Manila. From the release of the loan, the highest
interest was 29% and the lowest was 15.5% per annum. Spouses Castillo, et al. were notified in
writing. They neither gave their confirmation thereto nor did they formally question the changes.
However, respondent Castillo sent several letters to PSB requesting for the reduction of the rates.
Spouses Castillo, et al. defaulted due to financial constraints. Thus, PSB initiated an
extrajudicial foreclosure sale of the mortgaged properties which were auctioned. A certificate of sale
was then issued and submitted to the Clerk of Court and to the Ex-Officio Sheriff of Manila. The same,
sans the approval of the Executive Judge of the RTC, was registered with the Registry of Deeds.
Spouses Castillo, et al. failed to redeem the property.
Spouses Castillo, et al. filed a case before the Regional Trial Court (RTC). After trial, the RTC
decided that the questioned increases of the interest were unreasonable, excessive, and arbitrary.
PSB filed a motion for reconsideration. The RTC partially granted the motion by modifying the
interest rate from 17% to 24% per annum. The case was appealed to the Court of Appeals (CA) which
modified the decision of the RTC ordering PSB to refund to the plaintiffs the amount of interest
collected in excess of 17% per annum; declaring the Extrajudicial Foreclosure conducted by the
defendants as valid; and modifying the damages awarded to PSB.
ISSUE:
Whether the CA erred in declaring that the modifications in the interest rates are
unreasonable and in sustaining the award of damages and attorney’s fees.
RULING:
NO. Here, the increase or decrease of interest rates hinge solely on the discretion of PSB,
violated the principle of mutuality of contracts, and is unconscionable; therefore void. Any stipulation
regarding the validity or compliance of the contract left solely to the will of one of the parties is
likewise invalid.
PSB cannot claim that respondent recognized the legality of the changes. Spouses Castillo, et
al. exhibits readily shows that the conformity letter signed by them pertain only to the amendment
of the interest rate review period from 90 days to 30 days. This is separate from the modification of
the interest rate itself. Moreover, Spouses Castillo, et al. assent cannot be implied from their lack of
response to the memos sent by PSB. No one receiving a proposal to change a contract is obliged to
answer the proposal; assent is therefore not implied. Likewise, it cannot be said that Spouses Castillo,
et al. recognized the rates legality when it requested for a reduction its reduction. This does not
translate into consent. Further, the letters were actually questioning the propriety of the interest
rates.
The Court is not sufficiently convinced that fraud, bad faith, or wanton disregard of
contractual obligations can be imputed to PSB simply because it unilaterally imposed the changes in
interest rates. Thus, the award of moral and exemplary damages is unwarranted. In the same vein,
Spouses Castillo, et al. cannot recover attorney’s fees and litigation expenses.
As regards the award for refund to Spouses Castillo, et al. of their interest payments in excess
of 17% per annum, the same should include legal interest. The Court has held that when an obligation
is breached, and it consists in the payment of a sum of money, the interest on the amount of damages
shall be at the rate of 12% per annum, reckoned from the time of the filing of the complaint.
Cause of Contracts
UNION BANK OF THE PHILIPPINES v. SPOUSES RODOLFO T. TIU AND VICTORIA N. TIU
G.R. Nos. 173090-91, 7 September 2011, FIRST DIVISION (Leonardo-De Castro, J.)
In the determination of the nullity of a contract based on the lack of consideration, the debtor
has the burden to prove the same. Article 1354 of the Civil Code provides that although the cause is not
stated in the contract, it is presumed that it exists and is lawful, unless the debtor proves the contrary.
Union Bank of the Philippines (Union Bank) and spouses Rodolfo T. Tiu and Victoria N. Tiu
(the spouses Tiu) entered into a Credit Line Agreement (CLA) whereby Union Bank agreed to make
available to the spouses Tiu credit facilities in such amounts as may be approved. From September
22, 1997 to March 26, 1998, the spouses Tiu took out various loans pursuant to this CLA in the total
amount of three million six hundred thirty-two thousand dollars (US$3,632,000.00), as evidenced by
promissory notes. On June 23, 1998, Union Bank advised the spouses Tiu through a letter that, in
view of the existing currency risks, the loans shall be redenominated to their equivalent Philippine
peso amount. The spouses Tiu authorized Union Bank to redenominate the loans at the rate of
US$1=P41.40 with interest of 19% for one year. Union Bank and the spouses Tiu then entered into a
Restructuring Agreement. Under the same Restructuring Agreement, the parties declared that the
loan obligation to be restructured is one hundred four million six hundred sixty-eight thousand seven
hundred forty-one pesos (P104,668,741.00) (total restructured amount). As likewise provided in the
Restructuring Agreement, the spouses Tiu executed a Real Estate Mortgage in favor of Union Bank
over their residential property inclusive of lot and improvements. The spouses Tiu undertook to pay
the total restructured amount (P104,668,741.00) via three loan facilities (payment schemes). The
spouses Tiu postulate that their payments added up to P89,407,546.79.
Asserting that the spouses Tiu failed to comply with the payment schemes set up in the
Restructuring Agreement, Union Bank initiated extrajudicial foreclosure proceedings on the
residential property of the spouses Tiu. The spouses Tiu, together with Juanita T. Tiu, Rosalinda T.
King, Rufino T. Tiu, Rosalie T. Young and Rosenda T. Tiu, filed with the Regional Trial Court (RTC) a
Complaint seeking to have the Extrajudicial Foreclosure declared null and void. The spouses Tiu
claim that from the beginning the loans were in pesos, not in dollars. The spouses Tiu further claim
that they were merely forced to sign the Restructuring Agreement and take up an additional loan
of P5,000,000.00, the proceeds of which they never saw because this amount was immediately
applied by Union Bank to interest payments. The spouses Tiu allege that the foreclosure sale of the
mortgaged properties was invalid, as the loans have already been fully paid.
The RTC rendered its Decision in favor of Union The CA ruled in favor of the spouses Tiu and
denied Union Bank’s Motion for Reconsideration.
ISSUE:
Whether the restructuring agreement is valid.
RULING:
YES. Although indeed the spouses Tiu received peso equivalents of the borrowed amounts,
the loan documents presented as evidence, i.e., the promissory notes, expressed the amount of the
loans in US dollars and not in any other currency. This clearly indicates that the spouses Tiu were
bound to pay Union Bank in dollars, the amount stipulated in said loan documents. Thus, before the
Restructuring Agreement, the spouses Tiu were bound to pay Union Bank the amount of
US$3,632,000.00 plus the interest stipulated in the promissory notes, without converting the same
to pesos. The spouses Tiu, who are in the construction business and appear to be dealing primarily
in Philippine currency, should therefore purchase the necessary amount of dollars to pay Union Bank,
who could have justly refused payment in any currency other than that which was stipulated in the
promissory notes.
Such stipulation of payment in dollars is not prohibited by any prevailing law or

jurisprudence at the time the loans were taken. In this regard, Article 1249 of the Civil Code provides:
Art. 1249. The payment of debts in money shall be made in the currency stipulated,
and if it is not possible to deliver such currency, then in the currency which is legal
tender in the Philippines.
On April 13, 1993, Central Bank Circular No. 1389 was issued, lifting foreign exchange
restrictions and liberalizing trade in foreign currency. In cases of foreign borrowings and foreign
currency loans, however, prior Bangko Sentral approval was required. On July 5, 1996, Republic Act
No. 8183 took effect, expressly repealing Republic Act No. 529 in Section 2 thereof. The same statute
also explicitly provided that parties may agree that the obligation or transaction shall be settled in a
currency other than Philippine currency at the time of payment.
Although the Credit Line Agreement between the spouses Tiu and Union Bank was entered
into on November 21, 1995, when the agreement to pay in foreign currency was still considered void
under Republic Act No. 529, the actual loans, as shown in the promissory notes, were taken out
from September 22, 1997 to March 26, 1998, during which time Republic Act No. 8183 was already
in effect.
Having established that Union Bank and the spouses Tiu validly entered into dollar loans, the
conclusion of the Court of Appeals that there were no dollar loans to novate into peso loans must
necessarily fail. Similarly, the Court of Appeals pronouncement that the novation was not supported
by any cause or consideration is likewise incorrect. This conclusion suggests that when the parties
signed the Restructuring Agreement, Union Bank got something out of nothing or that the spouses
Tiu received no benefit from the restructuring of their existing loan and was merely taken advantage
of by the bank. It is important to note at this point that in the determination of the nullity of a contract
based on the lack of consideration, the debtor has the burden to prove the same. Article 1354 of the
Civil Code provides that [a]though the cause is not stated in the contract, it is presumed that it exists
and is lawful, unless the debtor proves the contrary.
As pointed out by the trial court, the Restructuring Agreement, being notarized, is a public
document enjoying a prima facie presumption of authenticity and due execution. The Court therefore
rules that the Restructuring Agreement is valid and, as such, a valid and binding novation of loans of
the spouses Tiu entered into from September 22, 1997 to March 26, 1998 which had a total amount
of US$3,632,000.00.
Rescissible Contracts
SAMUEL U. LEE AND PAULINE LEE AND ASIATRUST DEVELOPMENT BANK, INC. v. BANGKOK
BANK PUBLIC COMPANY, LIMITED
G.R. No. 173349, 9 February 2011, FIRST DIVISION (Velasco, Jr., J.)
The presumption of fraud established under Art. 1387 of the Civil Code does not apply to
registered lands if the judgment or attachment made is not also registered.
Midas Diversified Export Corp. (MDEC) and Manila Home Textile, Inc. (MHI), both owned and
controlled by the Lee family, entered into two separate Credit Line Agreements (CLAs) with Bangkok
Bank Public Company Limited (Bangkok Bank). The Lee family guaranteed the payment of all
indebtedness of MDEC and MHI with Bangkok Bank. MDEC was also granted a loan facility by
Asiatrust Development Bank, Inc. (Asiatrust). When MDEC had defaulted in the payment of its loan,
Asiatrust initiated negotiations with MDEC and required the Lee family to provide additional
collateral that would secure the loan. Asiatrust agreed that Samuel Lee would mortgage the subject
Antipolo properties to secure the loan, and execute a Real Estate Mortgage (REM) over the properties.
Similarly, the Lee family defaulted in their obligations with Bangkok Bank and other
creditors, including the Security Bank Corp. (SBC). Hence, SBC filed a case against the Lee family for
a sum of money. The Regional Trial Court (RTC) issued a Writ of Preliminary Attachment in favor of
SBC attaching the properties of the Lee family. The writ, however, was neither registered nor
annotated on the titles of the subject Antipolo properties at the Registry of Deeds. Bangkok Bank also
filed a case before the RTC to recover the loans it extended to MDEC and MHI. A writ of preliminary
attachment was likewise issued, covering the properties of the Lee family in Antipolo, Cavite, Quezon
City, and Baguio, among others.
With MDEC still unable to make payments on its defaulting loans with Asiatrust, the latter
foreclosed the subject mortgaged Antipolo properties. Subsequently, the sale was registered.
Believing the REM and the foreclosure sale to be fraudulent, Bangkok Bank did not redeem the
subject properties. Consequently, the TCTs covering the subject properties were consolidated in the
name of Asiatrust and new titles were issued in its name without the annotation of the writs of
preliminary attachment in favor of Bangkok Bank, which were deemed cancelled. Thus, Bangkok
Bank filed the instant case for the rescission of the REM over the subject properties, annulment of the
foreclosure sale, cancellation of the new TCTs issued in favor of Asiatrust, alleging that the
presumption of fraud under Article 1387 of the Civil Code applies, considering that a writ of
preliminary attachment was issued. It also claimed that collusion and fraud transpired between the
spouses Lee and Asiatrust in the execution of the REM. The RTC dismissed the case and found no
concrete proof of the alleged fraud committed by the Lee family and Asiatrust, more so, that of a
collusion or conspiracy between them. However, the Court of Appeals (CA) reversed.
ISSUE:
Whether or not the REM executed over the subject Antipolo properties and the foreclosure
sale were committed in fraud of the Lee family’s other creditors hence, the questioned mortgage
could be rescinded.
RULING:
NO. Under Art. 1381(3) of the Civil Code, contracts, which were undertaken in fraud of
creditors when the latter cannot in any other manner collect the claims due them, are rescissible. The
presumption of fraud established under Art. 1387 does not apply to registered lands if the judgment
or attachment made is not also registered. Where the judgment rendered against the defendant has
not been entered in the records of the register of deeds, relative to an immovable belonging to the
judgment debtor, the subsequent sale of said property by the latter, shall not be rescinded upon the
ground of fraud, unless the complicity of the buyer in the fraud imputed to said vendor is established
by other means than the presumption of fraud.
While a judgment was made against the spouses Lee in favor of SBC, this, however, was not
annotated on the titles of the subject properties. In fact, there is no showing that the judgment has
ever been annotated on the titles of the subject properties. As established in the facts, there were
only two annotations at the back of the titles of the Antipolo properties: first, the REM executed in
favor of Asiatrust; and second, the writ of preliminary attachment in favor of Bangkok
Bank. Considering that the earlier SBC judgment or attachment was not, and in fact never was,
annotated on the titles of the subject Antipolo properties, prior to the execution of the REM, the
presumption of fraud under Art. 1387 of the Code clearly cannot apply.
A careful reading of Art. 1387 of the Code vis-à-vis its Art. 1385 would plainly show that in
allowing rescission in case of an alienation by onerous title, the third person who received the
property conveyed should likewise be a party to the fraud. As a general rule, whether the person,
against whom a judgment was made or some writ of attachment was issued, acted with or without
fraud, so long as the third person who is in legal possession of the property in question did not act
with fraud and in bad faith, an action for rescission cannot prosper. Asiatrust, being a third person in
good faith, should not be automatically presumed to have acted fraudulently by the mere execution
of the REM over the subject Antipolo properties, there being no evidence of fraud or bad faith.
VICELET LALICON AND VICELEN LALICON v. NATIONAL HOUSING AUTHORITY

G.R. No. 185440, 13 July 2011, THIRD DIVISION (Abad, J.)
An action for rescission can proceed from either Article 1191 or Article 1381.
The National Housing Authority (NHA) executed a Deed of Sale with Mortgage over a Quezon
City lot in favor of the spouses Isidro and Flaviana Alfaro (the Alfaros). The deed of sale provided,
among others, that the Alfaros could sell the land within five years from the date of its release from
mortgage without NHA’s prior written consent. While the mortgage on the land subsisted, the Alfaros
sold the same to their son, Victor Alfaro (Victor), who had taken in a common-law wife, Cecilia, with
whom he had two daughters, Vicelet and Vicelen Lalicon (the Lalicons). After full payment of the
loan, the NHA released the mortgage. Later, Victor transferred ownership of the land to his
illegitimate daughters. Thereafter, Victor mortgaged the land to Marcela Lao Chua (Chua), Rosa Sy,
Amparo Ong, and Ida See. Subsequently, Victor sold the property to Chua, one of the mortgagees.
The NHA filed a case before the Regional Trial Court (RTC) for the annulment of the NHA’s
1980 sale of the land to the Alfaros, the latter’s 1990 sale of the land to their son Victor, and the
subsequent sale of the same to Chua, made in violation of NHA rules and regulations. The RTC ruled
that, although the Alfaros clearly violated the five-year prohibition, the NHA could no longer rescind
its sale to them since its right to do so had already prescribed, applying Article 1389 of the New Civil
Code. However, the Court of Appeals (CA) reversed.
ISSUE:
Whether or not the NHA’s right to rescind has prescribed.
RULING:
NO. The contract between the NHA and the Alfaros forbade the latter from selling the land
within five years from the date of the release of the mortgage in their favor but the Alfaros sold the
property to Victor on November 30, 1990 even before the NHA could release the mortgage in their
favor on March 21, 1991. Clearly, the Alfaros violated the five-year restriction, thus entitling the NHA
to rescind the contract.
An action for rescission can proceed from either Article 1191 or Article 1381. It has been
held that Article 1191 speaks of rescission in reciprocal obligations within the context of Article 1124
of the Old Civil Code which uses the term resolution. Resolution applies only to reciprocal
obligations such that a breach on the part of one party constitutes an implied resolutory condition
which entitles the other party to rescission. Resolution grants the injured party the option to pursue,
as principal actions, either a rescission or specific performance of the obligation, with payment of
damages in either case. Rescission under Article 1381, on the other hand, was taken from Article
1291 of the Old Civil Code, which is a subsidiary action, not based on a party’s breach of
obligation. The four-year prescriptive period provided in Article 1389 applies to rescissions under
Article 1381.
Here, the NHA sought annulment of the Alfaro’s sale to Victor because they violated the five-
year restriction against such sale provided in their contract. Thus, the CA correctly ruled that such
violation comes under Article 1191 where the applicable prescriptive period is that provided in
Article 1144 which is 10 years from the time the right of action accrues. The NHA’s right of action
accrued on February 18, 1992 when it learned of the Alfaro’s forbidden sale of the property to
Victor. Since the NHA filed its action for annulment of sale on April 10, 1998, it did so well within the
10-year prescriptive period.
Voidable Contracts
CORNELIA M. HERNANDEZ v. CECILIO F. HERNANDEZ

G.R. No. 158576, 09 March 2011, FIRST DIVISION (PEREZ, J.)
In determining whether consent is vitiated by any of the circumstances mentioned, courts are
given a wide latitude in weighing the facts or circumstances in a given case and in deciding in their favor
what they believe to have actually occurred, considering the age, physical infirmity, intelligence,
relationship, and the conduct of the parties at the time of the making of the contract and subsequent
thereto, irrespective of whether the contract is in public or private writing.
Cornelia M. Hernandez (Cornelia), Atty. Jose M. Hernandez (Jose), Mena Hernandez (Mena)
are the pro-indiviso owners of a land situated Sto. Tomas, Batangas with an area of 80,133 square
meters. The Republic, through the Department of Public Works and Highways (DPWH), offered to
purchase a portion of the said land, for use in the expansion of the South Luzon Expressway.
The initial purchase price that was offered by the government was allegedly at P35.00 per
square meter for 14,643 square meters of the aforementioned land. The Hernandez family rejected
the offer. After a series of negotiations with the DPWH, the last offer stood at P70.00 per square
meter. They still did not accept the offer and the government was forced to file an expropriation case.
Hence, an expropriation case was filed by the Republic.
Subsequently, Cornelia and her other co-owners executed an irrevocable Special Power of
Attorney (SPA) appointing Jose’s son, Cecilio Hernandez (Cecilio) as their “true and lawful attorney”
with respect to the expropriation of the subject property.
The just compensation for the condemned properties was P1,500.00 per square meter. The
total area that was condemned for the Hernandez family was 14,643 square meters. Thus, the
Hernandez family will get a total of P21,964,500.00 as just compensation. Thereafter, Cornelia
executed a revocation of the SPA withdrawing the authority earlier granted to Cecilio in the SPA. She
also moved for the withdrawal of her one-third (1/3) share of the just compensation, which is
equivalent to P7,321,500.00—the amount a pro-indiviso owner is to receive. The trial court granted
the motion with the condition that the money shall be released only to Cecilio, the attorney-in-fact.
The trial court took cognizance of the irrevocable nature of the SPA. Cecilio, therefore, was able to get
not just one-third (1/3) of, but the entire sum of P21,964,500.00.
Cornelia received from Cecilio a check amounting to P1,123,000.00. The check was however
accompanied by a receipt and quitclaim. The check was received by Cornelia with a heavy heart. She
averred that she was forced to receive such amount because she needs the money immediately for
medical expenses due to her frail condition. In a letter, Cornelia demanded the accounting of the
proceeds. The letter was left unanswered. Hence, Cornelia filed a complaint for the annulment of
quitclaim and recovery of sum of money and damages.
The trial court nullified the quitclaim in favor of Cecilio. On appeal, the Court of Appeals (CA)
reversed and set aside the ruling of the trial court. Hence, this petition.
ISSUE:
Whether or not the receipt and the quitclaim are valid.
RULING:
NO. A contract where consent is given through mistake, violence, intimidation, undue
influence, or fraud is voidable. In determining whether consent is vitiated by any of the circumstances
mentioned, courts are given a wide latitude in weighing the facts or circumstances in a given case
and in deciding in their favor what they believe to have actually occurred, considering the age,
physical infirmity, intelligence, relationship, and the conduct of the parties at the time of the making
of the contract and subsequent thereto, irrespective of whether the contract is in public or private
writing. And, in order that mistake may invalidate consent, it should refer to the substance of the
thing which is the object of the contract, or those conditions which have principally moved one or
both parties to enter the contract.
No evidence on record would show that Cornelia agreed to give Cecilio 83.07% of the
proceeds of the sale of her land. What is on record is that Cornelia asked for an accounting of the just
compensation from Cecilio several times, but the request remained unheeded. Right at that point, it
can be already said that Cecilio violated the fiduciary relationship of an agent and a principal.
Instead of an accounting, what Cornelia received was a receipt and quitclaim document that
was ready for signing. As testified to by Cornelia, due to her frail condition and urgent need of money
in order to buy medicines, she nevertheless signed the quitclaim in Cornelio’s favor. Quitclaims are
also contracts and can be voided if there was fraud or intimidation that leads to lack of consent. The
facts show that a simple accounting of the proceeds of the just compensation will be enough to satisfy
the curiosity of Cornelia. However, Cecilio did not disclose the truth and instead of coming up with
the request of his aunt, he made a contract intended to bar Cornelia from recovering any further sum
of money from the sale of her property.
The preparation by Cecilio of the receipt and quitclaim document which he asked Cornelia to
sign, indicate that even Cecilio doubted that he could validly claim 83.07% of the price of Cornelia’s
land. Based on the attending circumstances, the receipt and quitclaim document is an act of fraud
perpetuated by Cecilio.
Very clearly, both the service contract, and the later receipt and quitclaim document, the first
vitiated by mistake and the second being fraudulent, are void.
Estoppel
LANDOIL RESOURCES CORPORATION v. AL RABIAH LIGHTING COMPANY

G.R. No. 174720, 7 September 2011, THIRD DIVISION (Peralta, J.)
Under the doctrine of estoppels, an admission or representation is rendered conclusive upon the
person making it, and cannot be denied or disproved as against the person relying thereof.
Respondent Al Rabiah entered into a Sub-Contract Agreement wherein it was assigned to

carry out the electrical works of Kuwait Oil Company's project in Ahmadi, Kuwait. Later, the project
owner had withdrawn the principal contract which led to the termination of petitioner Landoil’s and
defendant CCI’s services. Consequently, Al Rabiah's works were stopped before completion.
Later, Landoil sent a letter to Al Rabiah acknowledging its indebtedness to the latter for
unpaid completed works. However, as Landoil failed to pay any part of the amount due, the dispute
was referred to the Commercial Kully Court of Kuwait for arbitration which awarded in favor of Al
Rabiah. Thereafter, the latter filed with the RTC of Makati, an action for Enforcement of Foreign
Judgment Plus Damages against CCI and Landoil.
In its Answer, Landoil admitted the existence of the Sub-Contract Agreement, but claimed to
have no knowledge as to its genuineness and due execution. By way of Special and Affirmative
Defenses, it argued among others that Al Rabiah had no cause of action; and that since it had not been
paid by its principal contractor the value of the corresponding accomplishments done by Al Rabiah,
the latter’s cause of action had not yet accrued.
After trial, the RTC rendered its Decision in favour of Al Rabiah, holding CCI and Landoil
solidarily laible. On appeal, the CA affirmed the RTC decision. The CA ruled, among others, that
Landoil was already estopped from claiming that it was not a party to the Sub-Contract Agreement.
The CA denied the motion for reconsideration. Hence, this petition.
ISSUE:
Whether or not estoppel was properly appreciated in this case.
RULING:
YES. Landoil is estopped from denying its participation and liability under the Sub-Contract
Agreement and the enforcement of the foreign arbitral award against it. Notwithstanding its denial,
Landoil did allege in its Answer that: “x x x Defendant had not been paid by its principal contractor
the payment/value of the corresponding accomplishments done by plaintiff and that therefore,
plaintiff’s cause of action against answering defendant has not accrued.”
Such statement impliedly admits its liability under the Subcontract Agreement, but raises as
a special defense that Al Rabiah’s action is allegedly premature, as Landoil itself had not received any
payment from its principal contractor.
Thus, Landoil itself is a party to the Subcontract Agreement and has made representations in
the past binding itself to Al Rabiah for overdue accounts in favor of the latter. Under the doctrine of
estoppels, an admission or representation is rendered conclusive upon the person making it, and
cannot be denied or disproved as against the person relying thereof. Landoil is indeed barred from
adopting an inconsistent position, attitude, or course of conduct that would cause loss or injury to Al
Rabiah.
Laches
FELICIANO GAITERO and NELIA GAITERO v. GENEROSO ALMERIA and TERESITA ALMERIA
G.R. No. 181812, 8 June 2011, SECOND DIVISION (Abad, J.)
Laches is a consideration in equity and therefore, anyone who invokes it must come to court
with clean hands, for he who has done inequity shall not have equity.
Feliciano and Nelia Gaitero’s land, which they acquired from the original lot owned by Rosario
Tomagan, adjoined that of Generoso and Teresita Almeria. In June 2000, the Almerias commissioned
a relocation survey of their lot and were astonished to find that the Gaiteros intruded into their lot
by as much as 737 square meters, which is the disputed area.
To settle the dispute, the Almerias waived their rights over a 158-sqm portion of the disputed
area in Gaitero’s favor. However, Gaitero filed an affidavit of adverse claim on the Almerias’ title over
the remaining 579-sqm. Gaitero also filed an action for recovery of possession against the Almerias
before the Municipal Circuit Trial Court (MCTC).
Gaitero claimed that he was the registered owner of the lot that he inherited from his mother.
They added that the Almerias claimed a portion of their lot by virtue of a relocation survey and fenced
it close to Gaitero’s house, obstructing the latter’s passageway; and that while the Almerias returned
158 sqm of the disputed portion, they refused to return to him the remaining 579 sqm. The Almerias
alleged that they bought their lot in 1985 by virtue of an Extra-Judicial Settlement of Estate and Sale
and that it was Gaitero who unlawfully encroached on the 737-sqm portion.
The MCTC dismissed Gaitero’s complaint, but the Regional Trial Court (RTC) reversed the
decision because laches prevented the Almerias from asserting their right because it took them 15
years before doing so. The Court of Appeals (CA) reinstated the MCTC decision.
ISSUES:
Whether or not the Almerias, though the rightful owners, were prevented to assert their
rights over the land on the ground of laches.
RULING:
NO. Gaitero’s theory of laches cannot vest on him the ownership of the disputed area. To
begin with, laches is a consideration in equity and therefore, anyone who invokes it must come to
court with clean hands, for he who has done inequity shall not have equity. Here, Gaitero’s claim of
laches against the Almerias can be hurled against him. When the lot that the Almerias acquired
(Lot 9964) was registered in 1979, Gaitero had constructive, if not actual, notice that the cadastral
survey included the disputed area as part of the land that Leon Asenjo claimed. Yet, neither Gaitero
nor his mother complained or objected to such inclusion.
Worse, when Gaitero saw the subdivision plan covering Tomagan’s original Lot 9960 in 1993,
it showed that the disputed area fell outside the boundaries of Lot 9960-A, which he claimed. Still,
Gaitero did nothing to correct the alleged mistake. He is by his inaction clearly estopped from
claiming ownership of the disputed area. He cannot avail himself of the law of equity.
BAGUIO TRINITY DEVELOPERS, INC. v. THE HEIRS OF JOSE RAMOS, et al.

G.R. No. 188381, 14 December 2011, THIRD DIVISION (Abad, J.)
The present standoff cannot remain indefinitely under a titling system that assures the existence
of only one valid title for every piece of registered land. Evidently, laches cannot bar an action sought to
relieve such intolerable standoff.
Spouses Meliton Grabiles and Leona Calderon (Spouses Grabiles) were the original registered
owner of a parcel of land in Rosario, La Union. After several transfers, it was eventually sold to Baguio
Trinity Developers, Inc (Baguio Trinity). It appears, however, that in 1985, Anastacio Laroco and
Leona Javier filed a reconstitution proceeding before the Regional Trial Court (RTC) of La Union
covering the Spouses Grabiles' original title. However, for some reason, the RTC's order direct the
reconsitution of the tile in the name of one Maria Bernal. This order was annotated in Grabiles'
Original Certificate of Title (OCT).
In 1986, Melicia Silva filed a second petition purportedly on behalf of the Spouses Grabiles
for the reconstitution of their original title before the same RTC. The RTC ordered the reconstitution
of the title in the name of Grabiles. Under this title, it stated that the lot was transferred to Jose Ramos
(Ramos) and the spouses Leopoldo and Victorina Nepa (Nepas).
In 1995, Baguio Trinity filed a complaint for the recovery and declaration of nullity of title
before the Municipal Trial Court (MTC) against the heirs of Ramos and Nepa who held the
reconstituted titles. The MTC dismissed the case for lack of jurisdiction. Two years later, Baguio
Trinity filed a second complaint for recovery of property before the RTC, which was denied by the
RTC for lack of jurisdiction, after discovering that the assessed value of the property was below
PhP20,000.
In 2007, Baguio Trinity filed with the Court of Appeals (CA) a petition for the annulment of
the reconstitution orders that the RTC issued in 1986. It claimed that it had no jurisdiction to order
the reconstitution for the Grabiles' title because it was not lost, and that Grabiles could not have
authorized anyone to institute the proceedings on their behalf since they had been long dead. The CA
dismissed the petition because of procedural infirmities. Baguio Trinity filed a motion for
reconsideration, after complying with the procedural requirements, but the CA still denied the same.
The CA also ruled that, in any event, Baguio Trinity was barred by laches, since the latter had a notice
of the reconstitution orders as early as 1995, but it only filed its action to annul these orders twelve
years later.
ISSUE:
Whether Baguio Trinity was barred by laches.
RULING:
NO. Baguio Trinity finally filed before the CA an action for annulment of the reconstitution
orders on the ground that the RTC did not have jurisdiction to issue them. It is not right for the CA to
dismiss such action by reason of laches simply because no inaction is evident on Baguio Trinity’s part.
In fact, it had been an unintentional object of relay between the lower courts which contributed to
the delay in the proceedings.
The petition for annulment alleged serious charges which if true can invalidate the heirs’ title.
Such title had been subjected to two reconstitution proceedings that could have divested the true
owner of title over his property. The conflict between the two sets of titles has to be resolved. The
present standoff cannot remain indefinitely under a titling system that assures the existence of only
one valid title for every piece of registered land. Evidently, laches cannot bar an action sought to
relieve such intolerable standoff.
Compromise
SPOUSES GEORGE R. TAN and SUSAN L. TAN v. BANCO DE ORO UNIBANK, INC.,
G.R. No. 188792, G.R. Nos. 190677-78, and G.R. Nos. 190699-700, 10 January 2011, SECOND
DIVISION, (Nachura, J.)
Having been sealed with court approval, the compromise agreement shall govern the respective
rights and obligations of the parties.
After the Spouses George R. Tan and Susan L. Tan (Spouses Tan) failed to pay its obligation
with Banco De Oro Unibank, Inc. (BDO) when they fell due, BDO foreclosed the property. Spouses Tan
moved to restrain the foreclosure proceeding by posting a bond. The RTC granted the injunction
however on appeal, the CA found the bonded posted by Spouses Tan to be grossly insufficient to cover
all the damages which BDO might sustain by reason of the injunction if the court should finally decide
that Spouses Tan were not entitled to the writ. The CA remanded the case with the RTC.
In the meantime, the parties entered into a compromised agreement which the RTC
approved.
ISSUE:
Whether or not the compromise agreement shall govern the rights and obligations of the
parties.
RULING:
YES. Having been sealed with court approval, the compromise agreement shall govern the
respective rights and obligations of the parties. In view of the foregoing, the dismissal of the
consolidated petitions is in order.
ALEXANDER S. GAISANO v. BENJAMIN C. AKOL

G.R. No. 193840, 15 June 2011, FIRST DIVISION (Velasco, Jr., J.)
A compromise agreement is a contract whereby the parties make reciprocal concessions, avoid
litigation, or put an end to one already commenced.
Parties Alexander Gaisano (Gaisano) and Benjamin Akol (Akol) jointly filed an Agreement to
Terminate Action through their counsels. Both agreed to settle their claims by agreeing to terminate
the same, waiving all rights arising out of Civil Case No. 2006-010 for the recovery of shares of stock
and the Petition for Review from the aforementioned dismissal of the case. All litigation expenses
have been agreed to be borne respectively. The settlement was for the parties’ peace of mind as the
same is an initiative to reestablish goodwill and an avenue to cut costs and expenses.
Gaisano and Akol, assisted by their counsels, stated in their compromise agreement that:
1. The parties have agreed to amicably settle this case by agreeing to terminate the same, including
the cases from which it originated, with herein parties waiving any and all of their claims arising
out of or necessarily connected with this case and its originating cases.
2. The parties shall bear their own litigation expenses in this case and the originating cases.
3. This settlement is for the sole purpose of buying peace, reestablishing goodwill and limiting legal
expenses and costs and/or avoids further protracted, tedious and expensive litigation and is in no
way an admission of fault or liability on the part of the parties for any wrongful acts.
ISSUE:
Whether or not the Compromise Agreement was valid and lawful.
RULING:
YES. A compromise agreement is a contract whereby the parties make reciprocal

concessions, avoid litigation, or put an end to one already commenced. Its validity depends on its
fulfillment of the requisites and principles of contracts dictated by law; its terms and conditions being
not contrary to law, morals, good customs, public policy and public order.
A scrutiny of the agreement reveals it is a compromise agreement sanctioned under Article

2028 of the Civil Code. Its terms and conditions are not contrary to law, morals, good customs, public
policy and public order. Hence, judgment can be validly rendered thereon.
BANGKO SENTRAL NG PILIPINAS v. ORIENT COMMERCIAL BANKING CORPORATION

G.R. No. 148483, 29 June 2011, FIRST DIVISION (Villarama, Jr., J.)
A Compromise Agreement intended to resolve a matter already under litigation is a judicial

compromise.
Orient Commercial Banking Corporation (OCBC) declared a bank holiday on account of its
inability to pay all its obligations to depositors, creditors and petitioner Bangko Sentral ng Pilipinas
(BSP). OCBC filed a petition for rehabilitation with the Monetary Board. The bank was placed under
receivership and the Philippine Deposit Insurance Corporation (PDIC) was designated as Receiver.
Jose C. Go, the principal and biggest stockholder of OCBC, with his affiliate companies (Go, et
al.), challenged the said action of the PDIC before the RTC of Manila, Branch 44. Said case was
dismissed and the dismissal was appealed to the CA.
During the pendency of the said case, the Monetary Board adopted a resolution directing the
Receiver to proceed with the liquidation of OCBC. Thereafter, BSP filed before the RTC of Manila,
Branch 12 a complaint for sum of money with preliminary attachment against Go, et al. seeking to
recover deficiency obligation owed by OCBC which then stood at P1,273,959,042.97 with interest at
8.894 % per annum, overdraft obligation of P1,028,000,000.00, attorney’s fees and costs of suit. The
petition for a writ of preliminary attachment was granted, and the corresponding writ was thereafter
issued.
Go, et al. filed before the Court of Appeals (CA) a petition for certiorari questioning the orders
of the RTC of Manila, Branch 12. The CA rendered a decision dissolving the writ of attachment and
ordering the RTC to desist from proceeding the subject civil case.
Hence, the BSP filed a petition for review on certiorari before the Supreme Court assailing the
decision of the CA. Thereafter, BSP filed a manifestation informing the Court that the parties have
agreed to settle their differences and executed a Compromise Agreement, which was approved by
the RTC of Manila. Attached to the said manifestation is the motion to approve judgment based on
compromise agreement and the trial court’s order approving the same.
ISSUE:
Whether or not the Compromise Agreement has a legal effect.
RULING:
YES. A compromise agreement intended to resolve a matter already under litigation is a

judicial compromise. Having judicial mandate and entered as its determination of the controversy,
such judicial compromise has the force and effect of a judgment. It transcends its identity as a mere
contract between the parties, as it becomes a judgment that is subject to execution in accordance
with the Rules of Court.
With the final settlement of the claims of BSP against Go, et al., the issues raised in the present
petition regarding the propriety of the issuance of writ of attachment by the trial court and the grave
abuse of discretion allegedly committed by the appellate court in reversing the orders of the trial
court, have now become moot and academic. “A moot and academic case is one that ceases to present
a justiciable controversy by virtue of supervening events, so that a declaration thereon would be of
no practical use or value.” In such cases, there is no actual substantial relief to which BSP would be
entitled to and which would be negated by the dismissal of the petition.
SALES
DEVELOPMENT BANK OF THE PHILIPPINES v. BEN P. MEDRANO and PRIVATIZATION

MANAGEMENT OFFICE [PMO]
G.R. No. 167004, 7 February 2011, THIRD DIVISION (Villarama, Jr., J.)
Under Article 1475 of the Civil Code, a contract of sale is perfected the moment there is a meeting
of the minds on the thing which is the object of the contract and on the price.
Development Bank of the Philippines (DBP) sought to consolidate its ownership in Paragon
Paper Industries, Inc. (Paragon). Ben P. Medrano (Medrano), as President and General Manager of
Paragon, was instructed to convince the minority stockholders to sell their shares to DBP. Medrano
was able to convince almost everyone to sell their shares to DBP. They made proposals to DBP and
the Board of Directors of DBP approved the sale under DBP Resolution No. 4270 subject to three (3)
conditions, one of which is that prior to the implementation of the approval, 57,596 shares of
Paragon’s stock issued to the stockholders concerned shall first be surrendered to the DBP. Medrano
then indorsed and delivered to DBP all his shares. DBP accepted said shares and took over Paragon.
DBP once again instructed Medrano to convince the other minority stockholders to sell their shares,
but Medrano was able to convince only two. Thus, his commission was reduced. Thereafter, Medrano
demanded that DBP pay the value of his shares, which he had already turned over, as well as
his commission. When DBP did not heed his demand, Medrano filed a complaint for specific
performance and damages against DBP.
DBP argued that there was no perfected contract of sale as the three conditions in DBP
Resolution No. 4270 were not fulfilled. It contended that it merely exercised its right to cancel the
sale under the Resolution since certain minority stockholders refused to sell their shares. The
Regional Trial Court (RTC) ruled in favor of Medrano. The Court of Appeals (CA) affirmed and held
that that there existed between DBP and Medrano a contract of sale and the conditions imposed by
Resolution No. 4270 were merely conditions imposed on the performance of an obligation. Hence,
while under Article 1545 of the Civil Code, DBP had the right not to proceed with the agreement upon
Medrano’s failure to comply with the conditions, DBP was deemed to have waived the performance
of the conditions when it chose to retain Medrano’s shares and later transfer them to the Asset
Privatization Trust (APT).
ISSUE:
Whether or not there was a perfected contract of sale between DBP and Medrano.
RULING:
NO. As a rule, a contract is perfected upon the meeting of the minds of the two parties. Under
Article 1475 of the Civil Code, a contract of sale is perfected the moment there is a meeting of the
minds on the thing which is the object of the contract and on the price. Under the law, a contract is
perfected by mere consent, that is, from the moment that there is a meeting of the offer and
the acceptance upon the thing and the cause that constitute the contract.
In the present case, Medrano’s offer to sell the shares of the minority stockholders at the price
of 65% of the par value was not absolutely and unconditionally accepted by DBP. DBP imposed
several conditions to its acceptance and it is clear that Medrano indeed tried in good faith to comply
with the conditions given by DBP but unfortunately failed to do so. Hence, there was no birth of a
perfected contract of sale between the parties.
The application of Paragraph 1, Article 1545 of the Civil Code presupposes that there is a
perfected contract between the parties and that one of them fails in the performance of an obligation
under the contract. The present case does not fall under this article because there is no perfected
contract of sale to speak of. Medrano’s failure to comply with the conditions set forth by DBP
prevented the perfection of the contract of sale. Hence, Medrano and DBP remained as prospective-
seller and prospective-buyer and not parties to a contract of sale.
This notwithstanding, however, the Court cannot simply agree with DBP’s argument that
since there is no perfected contract of sale, DBP should not be ordered to pay Medrano any amount.
In civil law, DBP’s act of keeping the shares delivered by Medrano without paying for them
constitutes unjust enrichment. It was not proper for DBP to hold on to Medrano’s shares of stock
after it became obvious that he will not be able to comply with the conditions for the contract of
sale. From that point onwards, the prudent and fair thing to do for DBP was to return Medrano’s
shares because DBP had no just or legal ground to retain them.
DOMINGO CARABEO v. SPOUSES NORBERTO and SUSAN DINGCO

The requirement that a sale must have for its object a determinate thing is satisfied as long as,
at the time the contract is entered into, the object of the sale is capable of being made determinate
without the necessity of a new or further agreement between the parties.
Domingo Carabeo and Spouses Norberto and Susan Dingco entered into a contract
(kasunduan) for Carabeo to sell his rights over a parcel of unregistered land in Bataan for P38,000.
When Spouses Dingco tendered their initial payment of P10,000, Carabeo told them to temporarily
keep the payment because he has to settle a dispute over the land first. However, the spouses still
gave small amounts of money upon the request of Carabeo, which totaled in P9,100. Carabeo refused
to accept the spouses’ payment of the remaining balance because he said he would register the land
first. However, Spouses Dingco found out that Carabeo registered the land in his own name,
prompting the spouses to file a complaint for specific performance before the Regional Trial Court
(RTC) of Balanga, Bataan.
Carabeo asserted that the contract is void because the metes and bounds of the land were not
specified. During the pendency of the case, Carabeo died. The records are bereft of any proof that his
counsel informed the trial court of such death.
The RTC, in its decision, ordered Carabeo to sell his rights to the land. The Court of Appeals
(CA) affirmed.
ISSUES:
1. Whether or not the failure to specify the land’s metes and bounds nullifies the contract of
sale.
2. Whether or not the complaint should be dismissed because of Carabeo’s death.
RULING:
1. NO. That the kasunduan did not specify the technical boundaries of the property did not render
the sale a nullity. The requirement that a sale must have for its object a determinate thing is satisfied
as long as, at the time the contract is entered into, the object of the sale is capable of being made
determinate without the necessity of a new or further agreement between the parties. As the above-
quoted portion of the kasunduan shows, there is no doubt that the object of the sale is determinate.
2. NO. In the present case, the Spouses Dingco are pursuing a property right arising from
the kasunduan, whereas petitioner is invoking nullity of the kasunduan to protect his proprietary
interest. Assuming arguendo, however, that the kasunduan is deemed void, there is a corollary
obligation of petitioner to return the money paid by the Spouses Dingco, and since the action involves
property rights, it survives.
It bears noting that trial on the merits was already concluded before petitioner died. Since the
trial court was not informed of Carabeo’s death, it may not be faulted for proceeding to render
judgment without ordering his substitution. Its judgment is thus valid and binding upon Carabeo’s
legal representatives or successors-in-interest, insofar as his interest in the property subject of the
action is concerned.
ANTONIO FRANCISCO v. CHEMICAL BULK CARRIERS, INCORPORATED

G.R. No. 193577, September 7, 2011, SECOND DIVISION (Carpio, J.)
A purchaser of property which has been stolen from the owner acquires no title to it even though
he purchased for value and in good faith.
Antonio Francisco (Francisco) was the owner and manager of a Caltex station. Four persons,
including Gregorio Bacsa (Bacsa), came to Francisco’s Caltex station and introduced themselves as
employees of Chemical Bulk Carriers, Incorporated (CBCI). Bacsa offered to sell to Francisco a certain
quantity of CBCI’s diesel fuel. After checking Bacsa’s identification card, Francisco agreed to purchase
CBCI’s diesel fuel. The deliveries lasted for ten months and there were 17 deliveries to Francisco.
CBCI sent a demand letter to Francisco regarding the diesel fuel delivered to him but which had been
paid for by CBCI. Francisco rejected CBCI’s demand. CBCI filed a complaint for sum of money and
damages against Francisco and other unnamed defendants. According to CBCI, Petron, on various
dates, sold diesel fuel to CBCI but these were delivered to and received by Francisco. Francisco then
sold the diesel fuel to third persons from whom he received payment. CBCI alleged that Francisco
acquired possession of the diesel fuel without authority from CBCI and deprived CBCI of the use of
the diesel fuel it had paid for. CBCI argued that Francisco should have known that since only Petron,
Shell and Caltex are authorized to sell and distribute petroleum products in the Philippines, the diesel
fuel came from illegitimate, if not illegal or criminal, acts. Francisco explained that he operates the
Caltex station with the help of his family because he completely lost his eyesight due to sickness.
Francisco claimed that he asked Jovito, his son, to look into and verify the identity of Bacsa, who
introduced himself as a radio operator and confidential secretary of a certain Mr. Inawat (Inawat),
CBCI’s manager for operations. Francisco said he was satisfied with the proof presented by Bacsa.
When asked to explain why CBCI was selling its fuel, Bacsa allegedly replied that CBCI was in
immediate need of cash for the salary of its daily paid workers and for petty cash. Francisco
maintained that Bacsa assured him that the diesel fuel was not a stolen property and that CBCI
enjoyed a big credit line with Petron. Francisco maintained that he acquired the diesel fuel in good
faith and for value. The trial court ruled in Francisco’s favor and dismissed CBCI’s complaint. CBCI
appealed to the Court of Appeals. The Court of Appeals set aside the trial court’s Decision and ruled
in CBCI’s favor.
ISSUE:
Whether CBCI approved expressly or tacitly the transactions of Bacsa.
RULING:
NO. The general principle is that a seller without title cannot transfer a better title than he
has. Only the owner of the goods or one authorized by the owner to sell can transfer title to the buyer.
Therefore, a person can sell only what he owns or is authorized to sell and the buyer can, as a
consequence, acquire no more than what the seller can legally transfer. Moreover, the owner of the
goods who has been unlawfully deprived of it may recover it even from a purchaser in good
faith. Thus, the purchaser of property which has been stolen from the owner has been held to acquire
no title to it even though he purchased for value and in good faith.
The exception from the general principle is the doctrine of estoppel where the owner of the
goods is precluded from denying the seller’s authority to sell. But in order that there may be estoppel,
the owner must, by word or conduct, have caused or allowed it to appear that title or authority to sell
is with the seller and the buyer must have been misled to his damage.
In this case, it is clear that Bacsa was not the owner of the diesel fuel. Francisco was aware of
this but he claimed that Bacsa was authorized by CBCI to sell the diesel fuel. However, Francisco’s
claim that Bacsa was authorized is not supported by any evidence except his self-serving testimony.
First, Francisco did not even confirm with CBCI if it was indeed selling its diesel fuel since it is not
one of the oil companies known in the market to be selling petroleum products. This fact alone should
have put Francisco on guard. Second, it does not appear that CBCI, by some direct and equivocal act,
has clothed Bacsa with the indicia of ownership or apparent authority to sell CBCIs diesel fuel.
Francisco did not state if the identification card presented by Bacsa indicated that he was CBCI’s
agent or a mere employee. Third, the receipt issued by Bacsa was typewritten on a half sheet of plain
bond paper. There was no letterhead or any indication that it came from CBCI and such was a
personal receipt issued by Bacsa and not an official receipt issued by CBCI. Consequently, CBCI is not
precluded by its conduct from denying Bacsas authority to sell. CBCI did not hold out Bacsa or
allow Bacsa to appear as the owner or one with apparent authority to dispose of the diesel fuel.
Clearly, Bacsa cannot transfer title to Francisco as Bacsa was not the owner of the diesel fuel
nor was he authorized by CBCI to sell its diesel fuel. CBCI did not commit any act to clothe Bacsa with
apparent authority to sell the diesel fuel that would have misled Francisco. Francisco, therefore, did
not acquire any title over the diesel fuel. Since CBCI was unlawfully deprived of its property, it may
recover from Francisco, even if Francisco pleads good faith.
Double Sale
DOLORITA C. BEATINGO v. LILIA BU GASIS

In determining who has a better right in case of double sale, the guidelines set forth in Article
1544 of the Civil Code apply.
Dolorita Beatingo (Beatingo) filed a Complaint for Annulment and Cancellation of Sale,
Reconveyance, Delivery of Title and Damages against Lilia Bu Gasis (Gasis) before the Regional Trial
Court (RTC). Beatingo alleged that she bought the subject land from Flora Gasis (Flora), as evidenced
by a notarized Deed of Sale. She filed a petition for the issuance of the owner’s duplicate certificate of
title in order for her to register the sale. However, the petition was opposed by Gasis, who claimed
that she was in possession of the Original Certificate of Title (OCT) as she purchased the subject
property from Flora that was also evidenced by a Deed of Sale.
Considering the controversy as one of double sale, the RTC ruled in favor of Gasis and applied
Article 1455 of the Civil Code. Beatingo filed a Motion for New Trial and Reconsideration on the
ground that she was in possession of the subject property actually and constructively, but it was
denied by the RTC. Beatingo appealed to the Court of Appeals (CA), but it was dismissed for
Beatingo’s failure to file the Appellant’s Brief despite several extensions granted by the CA.
ISSUE:
Whether or not the rule on double sale under Article 1544 of the Civil Code should be applied.
RULING:
YES. The present controversy is a clear case of double sale, where the seller sold one property
to different buyers, first to Beatingo and later to Gasis. In determining who has a better right, the
guidelines set forth in Article 1544 of the Civil Code apply.
Admittedly, the two sales were not registered with the Registry of Property. Since there was
no inscription, the next question is who, between Beatingo and Gasis, first took possession of the
subject property in good faith. As aptly held by the trial court, it was Gasis who took possession of
the subject property and, therefore, has a better right. Indeed, the execution of a public instrument
shall be equivalent to the delivery of the thing that is the object of the contract. However, the Court
has held that the execution of a public instrument gives rise only to a prima facie presumption of
delivery. It is deemed negated by the failure of the vendee to take actual possession of the land sold.
In this case, though the sale was evidenced by a notarized deed of sale, Beatingo admitted
that she refused to make full payment on the subject property and take actual possession thereof
because of the presence of tenants on the subject property. Clearly, Beatingo had not taken
possession of the subject property or exercised acts of dominion over it despite her assertion that
she was the lawful owner thereof. Gasis, on the other hand, showed that she purchased the subject
property without knowledge that it had been earlier sold by Flora to Beatingo. She had reason to
believe that there was no defect in her title since the owner’s duplicate copy of the OCT was delivered
to her by the seller upon full payment of the purchase price. She then took possession of the subject
property and exercised acts of ownership by collecting rentals from the tenants who were occupying
it. Hence, the RTC is correct in declaring that Gasis has a better right to the subject property.
LEASE
RENE ANTONIO v. GREGORIO MANAHAN

G.R. No. 176091, 24 August 2011 SECOND DIVISION (Perez, J.)
The rule is settled that failure to pay the lease rentals must be willful and deliberate in order to
be considered as ground for dispossession of an agricultural tenant. While the term deliberate is
characterized by or results from slow, careful, thorough calculation and consideration of effects and
consequences, the term "willful" has been defined as one governed by will without yielding to reason or
without regard to reason.
Rene Antonio entered into an agricultural leasehold agreement with Gregorio Manahan, the
owner of the adverse lot wherein the former is bound by the stipulated terms that he should not
expand the property only allocated to him and that the subject land should only be dedicated to the
planting of rice and that remittance of proceeds should be done with a three-day prior notice to the
latter.
Manahan filed a complaint before the courts alleging that the failure of Antonio to remit the
agricultural proceeds and also violating the terms of the agreement by also establishing pig pens
within the area and the planting of kangkong which is certainly excluded and violative of the contract.
Antonio, on the other hands, presented evidence that the failure of such remittance is not
deliberate and willful and proceeded to show that while he indeed lacked the remittance for a
specified period, he compensated its loss for another consideration to which Manahan accepted.
Furthermore, Antonio started to yield crops and added the additional yield in much later periods to
which Antonio otherwise accepted and denied, as shown in the receipts.
ISSUE:
Whether or not the land leased to Antonio should be dispossessed from him.
RULING:
YES. The rule is settled that failure to pay the lease rentals must be willful and deliberate in
order to be considered as ground for dispossession of an agricultural tenant. While the term
deliberate is characterized by or results from slow, careful, thorough calculation and consideration
of effects and consequences, the term "willful" has been defined as one governed by will without
yielding to reason or without regard to reason. In this case, Antonio was able to present evidence that
his failure to remit was not done with malice and with deliberate intent as he compensated and tried
to fulfill his obligations as soon as possible.
The grounds however for dispossession lies in the blatant violation of the lease agreement
which only allows for the planting of rice and the non-establishment of other properties inside the
lot and its expansion.
HEIRS OF ANTONIO FERAREN, REPRESENTED BYANTONIO FERAREN, JR., JUSTINA FERAREN-

TABORA, LEAH FERAREN-HONASAN, ELIZABETH MARIE CLAIRE FERAREN-ARRASTIA, MA.
TERESA FERAREN-GONZALES, JOHANNA MICHELYNNE FERAREN YABUT, SCHELMA
ANTONETTE FERAREN-MENDOZA AND JUAN MIGUEL FERAREN YABUT v. COURT OF APPEALS
(FORMER 12TH DIVISION) AND CECILIA TADIAR
G.R. No. 159328, October 5, 2011, THIRD DIVISION (Peralta, J.)
Under Article 1678 of the Civil Code, the lessor has the option of paying one-half of the value of
the improvements that the lessee made in good faith, which are suitable to the use for which the lease is
intended, and which have not altered the form and substance of the land. On the other hand, the lessee
may remove the improvements should the lessor refuse to reimburse.
Celia Tadiar (Tadiar) filed a complaint for unlawful detainer against the Heirs of Antonio
Feraren, alleging that she and her brothers are the co-owners of the parcel of land and that the lot
was sold by their father to the Spouses Antonio and Justina Feraren (Spouses Feraren) on pacto de
retro. Tadiar and her co-heirs re-acquired the property, and thereafter, the same was leased to
Spouses Feraren who have constructed a residential lot thereon. Tadiar and her co-heirs informed
Spouses Feraren of their intention to terminate the lease contract. Spouses Feraren, in turn, offered
to sell them their house or but the lot, which were declined by Tadiar and her co-heirs and, instead,
allowed the Spouses Feraren to continue renting the property. After the death of Antonio, the his
heirs requested Tadiar to extend the lease and even volunteered to temporarily vacate the propert.
Tadiar and her co-heirs agreed and they did not even increase the rentals. Nonetheless, the heirs of
Antonio failed to comply with their commitment.
The Heirs of Antonio contended that the lot being claimed by Tadiar is their property. Even
before the Spouses Feraren entered into a contract of sale with pacto de retro with the father of
Tadiar, the former were already in possession of the remaining portion of the subject property on
the strength of a lease contract executed in their favor by the latter. Their construction of a residential
house on the subject property was by virtue of a right granted under the said contract of lease;
petitioners were very much willing to vacate the disputed lot but only upon payment of the value of
all the improvements that they have legally introduced as builders in good faith on the said lot, which
includes the house presently standing thereon as well as the concrete fence surrounding the said
house; in the alternative, they offered to buy the parcel of land subject of the complaint.
ISSUE:
Whether or not the Heirs can compel Tadiar to reimburse to them them one-half of the value
of their house.
RULING:
NO. Under Article 1678 of the Civil Code, the lessor has the option of paying one-half of the
value of the improvements that the lessee made in good faith, which are suitable to the use for which
the lease is intended, and which have not altered the form and substance of the land. On the other
hand, the lessee may remove the improvements should the lessor refuse to reimburse. It appears,
nonetheless, that in her Complaint, Tadiar prayed for the demolition of the heirs’ residential house
constructed on the subject lot. It is, thus, clear that she does not want to appropriate the
improvements. As such, the Heirs cannot compel her to reimburse to them one-half of the value of
their house. The sole right of Heirs under Article 1678 then is to remove the improvements without
causing any more damage upon the property leased than is necessary.
MANILA INTERNATIONAL AIRPORT AUTHORITY v. DING VELAYO SPORTS CENTER, INC.

G.R. No. 161718, 14 December 2011, FIRST DIVISION (Leonardo-De Castro, J.)
An express agreement which gives the lessee the sole option to renew the lease is frequent and
subject to statutory restrictions, valid and binding on the parties.
The Manila International Airport Authority (MIAA) and Salem Investment Corporation
(Salem) entered into a Contract of Lease whereby the MIAA leased in favor of Salem a parcel of land
located in front of Manila International Airport (MIA). The agreed period of the lease is 25 years,
renewable for another 25 years.
Subsequently, in a Transfer of Lease Rights and Existing Improvements, Salem conveyed in

favor of Ding Velayo Export Corporation (Velayo Export) its leasehold rights over a portion of Lot 2-
A. In turn, Velayo Export executed Transfer of Lease Rights in favor of Ding Velayo Sports Center
(Velayo Sports Center), by which it conveyed a portion of its leasehold right over a 8,481-square
meter portion of the land it was leasing from MIAA. The MIAA and Velayo Sports Center executed
another Contract of Lease covering the subject property. The Contract of Lease between MIAA and
Velayo Sports Center indicated, among others, that the latter should inform the MIAA within 60 days
prior to the expiration of the original lease term, if wishes to renew the contract.
Velayo Sports Center began occupying the subject property and paying MIAA PhP2,205.25
per month as rental fee. It later constructed a multi-million plaza with a three-storey building on the
said property, and leased the building spaces to various businesses.
MIAA later issued Administrative Order (AO) No. 4, which fixed various rates for the lease
rentals of its properties. Velayo Sports Center alleged that the AO effected an increase in its rental. As
a result, MIAA now required Velayo Sports Center to pay a total of PhP42,405 every month. Velayo
Sports Center opposed the increase, and said so in a letter addressed to MIAA. After their exchange,
MIAA kept on charging Velayo Sports Center the original monthly rental.
60 days prior to the expiration of the lease, the President of Velayo Sports Center a letter
stating his interest to renew the lease for another 25 years. MIAA declined to renew the lease, and
ordered Velayo Sports Center to vacate the property within the next five days, and to pay arrears in
lease rentals in the sum of PhP15,671,173.75. MIAA, in essence, argues that the renewal of the lease
contract cannot be made on the sole will of Velayo Sports Center
ISSUE:
Whether the renewal of the lease contract may be made to depend on the sole will of Velayo
Sports Center.
RULING:
YES. An express agreement which gives the lessee the sole option to renew the lease is
frequent and subject to statutory restrictions, valid and binding on the parties. The fact that such
option is binding only on the lessor and can be exercised only by the lessee does not render it void
for lack of mutuality. After all, the lessor is free to give or not to give the option to the lessee.
In this case, the Contract of Lease gave Velayo Sports Center the option of renewing the lease
of the subject property, the only express requirement was for respondent to notify petitioner of its
decision to renew the lease within 60 days prior to the expiration of the original lease term, which it
did. Thus, MIAA freely consented to giving respondent the exclusive right to choose whether or not
to renew the lease.
AGENCY
URBAN BANK, INC. v. MAGDALENO PEÑA

G.R. No. 145817, October 19, 2011, SECOND DIVISION (Sereno, J.)
Agency is presumed to be for compensation. Unless the contrary intent is shown, a person who
acts as an agent does so with the expectation of payment according to the agreement and to the services
rendered or results effected.
Isabela Sugar Company, Inc. (ISCI) owned a parcel of land located in Pasay City (the Pasay
property). ISCI leased the Pasay property. Without its consent and in violation of the lease
contract, the lessee subleased the land to several tenants, who in turn put up establishments. ISCI
informed the lessee and his tenants that the lease would no longer be renewed and that it intended
to take over the Pasay property for the purpose of selling it. Before the lease over the Pasay property
was to expire, ISCI and Urban Bank executed a Contract to Sell. Both parties agreed that the final
installment would be released by Urban Bank upon ISCI’s delivery of full and actual possession of the
land, free from any tenants. ISCI then instructed Atty. Magdaleno M. Peña (Peña), who was its director
and corporate secretary, to take over possession of the Pasay property against the tenants upon the
expiration of the lease. ISCI’s president, faxed a letter to Peña, confirming the latter’s engagement as
the corporation’s agent to handle the eviction of the tenants from the Pasay property. On the day the
lease contract was to expire, ISCI and Urban Bank executed a Deed of Absolute Sale over the Pasay
property for the amount agreed upon in the Contract to Sell. The title to the land was eventually
transferred to the name of Urban Bank. The lessee then duly surrendered possession of the Pasay
property to ISCI, but the unauthorized sub-tenants refused to leave the area. Pursuant to his
authority from ISCI, Peña had the gates of the property closed to keep the sub-tenants out. He also
posted security guards at the property, services for which he advanced payments.
In the meantime, the representative of ISCI asked Urban Bank for the issuance of formal
authority for Peña, since the tenants were questioning ISCI’s authority to take over the Pasay
property. In response, Urban Bank advised Peña that the bank had noted the engagement of his
services by ISCI and stressed that ISCI remained as the lawyer’s principal. To prevent the sub-tenants
from further appropriating the Pasay property, Peña filed a complaint for injunction (the First
Injunction Complaint) which was granted. At the time the First Injunction Complaint was filed, a new
title to the Pasay property had already been issued in the name of Urban Bank. When information
reached the judge that the Pasay property had already been transferred by ISCI to Urban Bank, the
trial court recalled the TRO and issued a break-open order for the property. According to Peña, it was
the first time that he was apprised of the sale of the land by ISCI and of the transfer of its title in favor
of the bank. On the same day that the TRO was recalled, Peña immediately contacted ISCI’s president,
who in turn confirmed the sale of the Pasay property. Peña told the president that because of the
break-open order, Peña would be recalling the security guards he had posted to secure the property.
The president, however, asked him to suspend the planned withdrawal of the posted guards, so that
ISCI could get in touch with Urban Bank on the matter. Peña was informed that Urban Bank would be
retaining his services in guarding the Pasay property, and that he should continue his efforts in
retaining possession thereof.
Peña then moved for the dismissal of ISCI’s First Injunction Complaint, since the Pasay
property, subject of the suit, had already been transferred to Urban Bank. The RTC-Pasay City
dismissed the complaint and recalled its earlier break-open order. Peña, now in representation of
Urban Bank, filed a separate complaint (the Second Injunction Complaint) with the RTC-Makati City,
to enjoin the tenants from entering the Pasay property, which was granted. While the Second
Injunction Complaint was pending, Peña made efforts to settle the issue of possession of the Pasay
property with the sub-tenants. Peña advanced the payment for the full and final settlement of their
claims against Urban Bank. Peña claims to have borrowed a sum of money from one of his friends in
order to maintain possession thereof on behalf of Urban Bank. Peña formally informed Urban Bank
that it could already take possession of the Pasay property. There was however no mention of the
compensation due and owed to him for the services he had rendered. Urban Bank subsequently took
actual possession of the property and installed its own guards at the premises. Peña formally
demanded from Urban Bank the payment of the 10% compensation and attorney’s fees allegedly
promised to him for securing and maintaining peaceful possession of the property.
ISSUE:
Whether or not Peña is entitled to payment for compensation for services rendered as agent
of Urban Bank.
RULING:
YES. Peña should be paid for services rendered under the agency relationship that existed
between him and Urban Bank based on the civil law principle against unjust enrichment, but the
amount of payment he is entitled to should be made, again, under the principle against unjust
enrichment and on the basis of quantum meruit.
Agency is presumed to be for compensation. But because there is no evidence that Urban
Bank agreed to pay Peña a specific amount or percentage of amount for his services, the Court turned
to the principle against unjust enrichment and on the basis of quantum meruit. Since there was no
written agreement with respect to the compensation due and owed to Atty. Peña, the Court will resort
to determining the amount based on the well-established rules on quantum meruit.
Agency is presumed to be for compensation. Unless the contrary intent is shown, a person
who acts as an agent does so with the expectation of payment according to the agreement and to the
services rendered or results effected. The agency of Peña comprised of services ordinarily performed
by a lawyer who is tasked with the job of ensuring clean possession by the owner of a property. A
stipulation on a lawyer’s compensation in a written contract for professional services ordinarily
controls the amount of fees that the contracting lawyer may be allowed to collect, unless the court
finds the amount to be unconscionable. In the absence of a written contract for professional services,
the attorney’s fees are fixed on the basis of quantum meruit, i.e., the reasonable worth of the
attorney’s services. When an agent performs services for a principal at the latter’s request, the law
will normally imply a promise on the part of the principal to pay for the reasonable worth of those
services. The intent of a principal to compensate the agent for services performed on behalf of the
former will be inferred from the principal’s request for the agents.
In this case, no extra-ordinary skills employing advanced legal training nor sophisticated
legal maneuvering were required to be employed in ejecting sub-tenants who have no lease contract
with the property owner, and whose only authority to enter the premises was unlawfully given by a
former tenant whose own tenancy has clearly expired.
WESTMONT INVESTMENT CORPORATION v. AMOS P. FRANCIA, JR., et al.

G.R. No. 194128, 7 December 2011, THIRD DIVISION (Mendoza, J.)
Principal-agent relationship must be duly established by evidence.
Amos P. Francia, Jr., Cecilia Zamora and Benjamin Francia (the Francias) filed a Complaint for
Collection of Sum of Money and Damages arising from their investments against Westmont
Investment Corporation (Wincorp) and Pearlbank Securities Inc. (Pearlbank) before the Regional
Trial Court. Amos testified that he was allegedly enticed by Ms. Lalaine Alcaraz, the bank manager of
Westmont Bank, to make an investment with Wincorp, the bank’s financial investment arm, as it was
offering interest rates that were 3% to 5% higher than regular bank interest rates. Due to the promise
of a good return of investment, he was convinced to invest. He even invited his sister, Cecilia Zamora
and his brother, Benjamin, to join him. Eventually, they placed their investment in the amounts of
₱1,420,352.72 and ₱2,522,745.34 with Wincorp in consideration of a net interest rate of 11% over a
43-day spread. When the 43-day placement matured, the Francias wanted to retire their
investments but they were told that Wincorp had no funds. Instead, Wincorp rolled-over their
placements and issued Confirmation Advices extending their placements for another 34 days. The
said confirmation advices indicated the name of the borrower as Pearlbank. They again tried to get
back the principal amount they invested plus interest but, again, they were frustrated. Constrained,
they demanded from Pearlbank their investments. The complaint against Pearlbank was dismissed,
while the case was considered submitted for decision insofar as Wincorp was concerned. The RTC
then rendered a decision in favor of the Francias and held Wincorp solely liable to them. Wincorp
interposed an appeal with the Court of Appeals. The CA affirmed with modification the ruling of the
RTC. Wincorp’s Motion for Reconsideration was likewise denied by the CA. Not in conformity,
Wincorp seeks relief with this Court via this petition for review. Wincorp would want the Court to
rule that there was a contract of agency between it and the Francias with the latter authorizing the
former as their agent to lend money to Pearlbank. According to Wincorp, the two Confirmation
Advices presented as evidence by the Francias and admitted by the court, were competent proof that
the recipient of the loan proceeds was Pearlbank.
ISSUE:
Whether Wincorp is an agent of Pearlbank.
RULING:
NO. In a contract of agency, a person binds himself to render some service or to do something
in representation or on behalf of another with the latter’s consent. It is said that the underlying
principle of the contract of agency is to accomplish results by using the services of others to do a great
variety of things. Its aim is to extend the personality of the principal or the party for whom another
acts and from whom he or she derives the authority to act. Its basis is representation.
Significantly, the elements of the contract of agency are: (1) consent, express or implied, of
the parties to establish the relationship; (2) the object is the execution of a juridical act in relation to
a third person; (3) the agent acts as a representative and not for himself; (4) the agent acts within
the scope of his authority.
In this case, the principal-agent relationship between the Francias and Wincorp was not duly
established by evidence. The records are bereft of any showing that Wincorp merely brokered the
loan transactions between the Francias and Pearlbank and the latter was the actual recipient of the
money invested by the former. Pearlbank did not authorize Wincorp to borrow money for it. Neither
was there a ratification, expressly or impliedly, that it had authorized or consented to said
transaction.
TRUST
RICHARD JUAN v. GABRIEL YAP, SR.

G.R. No. 182177, 30 March 2011, SECOND DIVISION (CARPIO, J.)
An implied trust arising from mortgage contracts is not among the trust relationships the Civil
Code enumerates. The Code itself provides, however, that such listing "does not exclude others
established by the general law on trust.
On 31 July 1995, the spouses Maximo and Dulcisima Caneda (Caneda spouses) mortgaged to
Juan Richard Juan (Juan), employee and nephew of Yap Gabriel Yap, Sr. (Yap), two parcels of land in
Talisay, Cebu to secure a loan of P1.68 million, payable within one year. On 30 June 1998, Juan sought
the extrajudicial foreclosure of the mortgage. Juan and Yap both participated in the auction sale which
was eventually won by the Juan for tendering the highest bid of P2.2 million. No certificate of sale
was issued to Juan, however, for his failure to pay the sale's commission.
On 15 February 1999, Yap and the Caneda spouses executed a memorandum of agreement
(MOA) where (1) the Caneda spouses acknowledged Yap as their "real mortgagee-creditor while
Richard Juan is merely a trustee" of Yap; (2) Yap agreed to allow the Caneda spouses to redeem the
foreclosed properties for P1.2 million; and (3) the Caneda spouses and Yap agreed to initiate judicial
action "either to annul or reform the [Contract] or to compel Richard Juan to reconvey the
mortgagee's rights" to Yap as trustor. Three days later, the Caneda spouses and Yap sued Juan in the
RTC of Cebu City to declare Yap as trustee of Juan vis a vis the Contract, annul Juan's bid for the
foreclosed properties, declare the Contract "superseded or novated" by the MOA, and require Juan to
pay damages, attorney's fees and the costs. The Caneda spouses consigned with the trial court the
amount of P1.68 million as redemption payment. In his Answer, Juan insisted on his rights over the
mortgaged properties. Juan also counterclaimed for damages and attorney's fees and the turn-over
of the owner's copy of the titles for the mortgaged properties.
The Regional Trial Court (RTC) ruled against Yap and his co-plaintifffs and granted reliefs to
Juan by declaring Juan the “true and real” mortgagee, ordering Yap to pay moral damages and
attorney’s fees, and requiring Yap to deliver the titles in question to Juan. However, the trial court
granted the Caneda spouses’ prayer to redeem the property and accordingly ordered the release of
redemption payment to Juan. Trial court gave primacy to the terms of the Contract, rejecting Yap’s
theory in light of his failure to assert beneficial interest over the mortgaged properties for nearly four
years.
The Yaps appealed to the Court of Appeals (CA). CA reversed the trial court’s ruling, declared
Yap the contract’s mortgagee, directed the lower court to release the redemption payment to Yap,
and ordered Juan to pay damages and attorney’s fee. Juan prayed for the reversal of CA’s ruling,
relying on the terms of the Contract.
ISSUE:
Whether or not an implied trust arose between Juan and Yap, binding Juan to hold the
beneficial title over the mortgaged properties in trust for Yap.
RULING:
YES. An implied trust arising from mortgage contracts is not among the trust relationships
the Civil Code enumerates. The Code itself provides, however, that such listing "does not exclude
others established by the general law on trust x x x." Under the general principles on trust, equity
converts the holder of property right as trustee for the benefit of another if the circumstances of its
acquisition make the holder ineligible "in x x x good conscience [to] hold and enjoy [it]." As implied
trusts are remedies against unjust enrichment, the "only problem of great importance in the field of
constructive trusts is whether in the numerous and varying factual situations presented x x x there
is a wrongful holding of property and hence, a threatened unjust enrichment of the defendant."
Applying these principles, the Court recognized unconventional implied trusts in contracts
involving the purchase of housing units by officers of tenants' associations in breach of their
obligations, the partitioning of realty contrary to the terms of a compromise agreement, and the
execution of a sales contract indicating a buyer distinct from the provider of the purchase money. In
all these cases, the formal holders of title were deemed trustees obliged to transfer title to the
beneficiaries in whose favor the trusts were deemed created. The Court sees no reason to bar the
recognition of the same obligation in a mortgage contract meeting the standards for the creation of
an implied trust.
The SC found Yap’s case convincing for three reasons: 1) the Caneda spouses acknowledged
Yap as the lender from whom they borrowed the funds secured by the Contract as evidenced by the
MOA and the request seeking for an extension of time directed to the Yap. Juan, therefore, was a
stranger to the loan agreement, the principal obligation the Contract merely secured; 2) Atty.
Antonio Solon, the notary public who drew up and notarized the Contract, testified that he placed
Juan's name in the Contract as the mortgagor upon the instruction of Yap. Yap himself explained that
he found this arrangement convenient because at the time of the Contract's execution, he was mostly
abroad and could not personally attend to his businesses in the country; 3) Lastly, it was Yap, not
Juan, who shouldered the payment of the foreclosure expenses. Juan's failure to explain this oddity,
coupled with the fact that no certificate of sale was issued to him (despite tendering the highest bid)
for his non-payment of the commission, undercuts his posturing as the real mortgagor.
Clearly then, Juan holds title over the mortgaged properties only because Yap allowed him to
do so. The demands of equity and justice mandate the creation of an implied trust between the two,
barring Juan from asserting proprietary claims antagonistic to his duties to hold the mortgaged
properties in trust for Yap. To arrive at a contrary ruling is to tolerate unjust enrichment, the very
evil the fiction of implied trust was devised to remedy.
CREDIT TRANSACTIONS
Loan
LOTTO RESTAURANT CORPORATION, represented by SUAT KIM GO v. BPI FAMILY SAVINGS

BANK, INC.
The Court has upheld as valid the proviso in loans that the interest rate would be made to
depend on the prevailing market rate. Such provision does not signify an automatic increase in the
interest. It simply means that the bank may adjust the interest according to the prevailing market
rate. This may result to either an increase or a decrease in the interest.
On December 23, 1999, Lotto Restaurant Corporation (Lotto) got a loan of P3,000,000.00 from
the DBS Bank (DBS) at an interest rate of 11.5% per annum. The promissory note it executed
provided that Lotto would pay DBS a monthly amortization of P35,045.69 for 180 months. To secure
payment of the loan, Lotto, represented by Suat Kim Go (Go), its General Manager, mortgaged to DBS
a condominium unit that belonged to it.
Lotto paid its monthly amortizations for 12 months from December 24, 1999 to December 24,
2000. But in January 2001, after DBS increased the interest to 19% per annum, Lotto contested the
increase and stopped paying the loan. After respondent BPI Family Savings Bank, Inc. (BPI) acquired
DBS, Lotto tried to negotiate with BPI for reduction of interest but the latter agreed to reduce it to
only 14.7% per annum, which was still unacceptable to Lotto. To satisfy its unpaid claim of
P5,283,470.26, BPI foreclosed the mortgage on Lotto's condominium unit which included interest,
penalties, fire insurance premium, attorney's fees, and estimated foreclosure expenses on October
21, 2002. BPI's computation applied an interest rate of 19% per annum for the period December 24,
2000 to November 24, 2001; and 14.7% per annum for the period December 24, 2001 to October 10,
2002.
Lotto filed against BPI with the Regional Trial Court (RTC) of Manila an action for reformation
or annulment of real estate mortgage with prayer for a temporary restraining order (TRO) and
preliminary injunction to stop the foreclosure. The RTC issued a TRO and a preliminary
injunction, enjoining the foreclosure sale of the condominium unit. On January 11, 2005 the RTC
rendered a decision in Lotto's favor, finding that DBS breached the stipulations in the promissory
note when it unilaterally increased the interest rate on its loan from 11.5% to 19% per
annum. Further, the RTC held that the mortgage on the condominium unit was void since the Lotto
Board of Directors did not authorize Go to sign the document. The RTC directed the Register of Deeds
to cancel the encumbrance on Lotto's title and ordered Lotto to pay BPI its loan of P2,990,832.00 at
P35,045.69 a month, less the amortizations that it already paid.
BPI appealed to the Court of Appeals (CA) which reversed the RTC decision. CA held that Lotto
was estopped from questioning the validity of the promissory note and the real estate mortgage
since, having authorized Go to take out a loan from the bank, it followed that it also authorized her to
provide the security that the loan required. Lotto filed a motion for reconsideration but it was denied.
Consequently, Lotto filed a petition for review with the Supreme Court.
ISSUE:
Whether or not BPI has the right to foreclose the real estate mortgage for non-payment of the
loan.
RULING:
YES. The SC denies the petition of Lotto and affirms the decision and the resolution of the CA.
Lotto claims that the real estate mortgage that Go executed was void since it did not authorize her to
execute the same and since DBS did not sign it. However, Lotto admitted in its complaint that Go had
obtained a loan from DBS on its behalf, with the condominium unit as collateral. With this admission,
Lotto should be deemed estopped from assailing the validity and due execution of that mortgage
deed. As to BPI's right to foreclose, the records show that Lotto defaulted in its obligation when it
unjustifiably stopped paying its amortizations after the first year. Consequently, there is no question
that BPI (which succeeded DBS) had a clear right to foreclose on Lotto's collateral.
SPOUSES WILFREDO AND BRIGIDA PALADA v. SOLIDBANK CORPORATION, et al.

A loan contract is perfected only upon the delivery of the object of the contract.
In February or March 1997, petitioners, spouses Wilfredo and Brigida Palada, applied for a P3
million loan. On March 17, 1997, petitioners received from the bank the amount of P1 million as
additional working capital evidenced by a promissory note and secured by a real estate mortgage in
favor of the bank covering several real properties situated in Santiago City. Due to the failure of
petitioners to pay the obligation, the bank foreclosed the mortgage and sold the properties at public
auction.
On August 19, 1999, petitioners filed a Complaint for nullity of real estate mortgage and
sheriff’s certificate of sale with prayer for damages. Petitioners alleged that the bank, without their
knowledge and consent, included their properties covered by Transfer Certificate of Title (TCT) Nos.
T-225131 and T-225132, among the list of properties mortgaged; that it was only when they received
the notice of sale from the sheriff in August 1998 that they found out about the inclusion of the said
properties; that despite their objection, the sheriff proceeded with the auction sale; and that the
auction sale was done in Santiago City in violation of the stipulation on venue in the real estate
mortgage.
The bank, in its Answer, denied the material allegations of the Complaint and averred that
since petitioners were collaterally deficient, they offered TCT Nos. T-237695, T-237696, T-225131
and T-225132 as additional collateral; that although the said properties were at that time mortgaged
to the Philippine National Bank (PNB), the bank accepted the offer and caused the annotation of the
mortgage in the original copies with the Register of Deeds with the knowledge and consent of
petitioners; and that when petitioners’ obligation to PNB was extinguished, they delivered the titles
of the four properties to the bank.
The Regional Trial Court (RTC) rendered a Decision declaring the real estate mortgage void
for lack of sufficient consideration. According to the RTC, the real estate mortgage lacks consideration
because the loan contract was not perfected due to the failure of the bank to deliver the full P3 million
to petitioners. The defendant also appears to have been motivated by bad faith amounting to fraud
when it was able to register the mortgage with the Register of Deeds at the time when the collateral
certificates of titles were still in the custody and possession of another mortgagee bank (PNB) due
also to an existing/subsisting mortgage covering the same. Definitely, the defendant resorted to some
machinations or fraudulent means in registering the contract of mortgage with the Register of Deeds.
On appeal, the Court of Appeals (CA) reversed the ruling of the RTC.
ISSUE:
Whether the real estate mortgage and the auction sale are valid.
RULING:
YES. The loan contract was perfected. Under Article 1934 of the Civil Code, a loan contract is
perfected only upon the delivery of the object of the contract. In this case, although petitioners
applied for a P3 million loan, only the amount of P1 million was approved by the bank because
petitioners became collaterally deficient when they failed to purchase TCT No. T-227331 which had
an appraised value of P1,944,000.00. Hence, on March 17, 1997, only the amount of P1 million was
released by the bank to petitioners.
Upon receipt of the approved loan on March 17, 1997, petitioners executed a promissory note
for the amount of P1 million. As security for the P1 million loan, petitioners on the same day executed
in favor of the bank a real estate mortgage over the properties covered by TCT Nos. T-237695, T-
237696, T-237698, T-143683, T-143729, T-225131 and T-225132. Clearly, contrary to the findings
of the RTC, the loan contract was perfected on March 17, 1997 when petitioners received the P1
million loan, which was the object of both the promissory note and the real estate mortgage executed
by petitioners in favor of the bank.
Claims of fraud and bad faith are unsubstantiated. There is nothing on the face of the real
estate mortgage contract to arouse any suspicion of insertion or forgery. Below the list of properties
mortgaged are the signatures of petitioners. Except for the bare denials of petitioner, no other
evidence was presented to show that the signatures appearing on the dorsal portion of the real estate
mortgage contract are forgeries. Likewise, flawed is petitioners’ reasoning that TCT Nos. T-225131
and T-225132 could not have been included in the list of properties mortgaged as these were still
mortgaged with the PNB at that time. Under our laws, a mortgagor is allowed to take a second or
subsequent mortgage on a property already mortgaged, subject to the prior rights of the previous
mortgages.
Deposit
DURBAN APARTMENTS CORPORATION v. PIONEER INSURANCE AND SURETY CORPORATION

A deposit is constituted from the moment a person receives a thing belonging to another, with
the obligation of safely keeping it and returning the same.
After Jeffrey See (See) has checked-in at Durban Apartments Corporation (Durban) (or City
Garden Hotel) and has surrendered the possession of his 2001 Suzuki Grand Vitara to Durban’s
parking attendant, the same was carnapped while it was parked unattended at the parking area of
Equitable PCI Bank. The Vitara was never recovered. See claimed that Durban was negligent which
resulted to the loss of his car. See demanded payment however this was refused by Durban and
Justimbaste.
Pioneer Insurance and Surety Corporation (Pioneer), the insurer of the See’s car, paid for the
losses and by right of subrogation, filed with the RTC of Makati City a Complaint for Recovery of
Damages against Durban. In their answer, Durban argued that See was not their client since he is
merely a guest of a certain Ching Montero and the parking privileges extended to their customers
does not include responsibility for any losses or damages to motor vehicles and its accessories in the
parking area. After trial, the RTC ruled in favor of Pioneer and ordered Durban to pay Pioneer. On
appeal, the CA affirmed the decision of the RTC.
ISSUE:
Whether or not Durban is liable for the loss of See’s car.
RULING:
YES. The records reveal that upon arrival at the City Garden Hotel, See gave notice to the
doorman and parking attendant of the said hotel, Justimbaste, about his Vitara when he entrusted its
ignition key to the latter. Justimbaste issued a valet parking customer claim stub to See, parked the
Vitara at the Equitable PCI Bank parking area, and placed the ignition key inside a safety key box
while See proceeded to the hotel lobby to check in. The Equitable PCI Bank parking area became an
annex of City Garden Hotel when the management of the said bank allowed the parking of the vehicles
of hotel guests thereat in the evening after banking hours.
The law provides that a deposit is constituted from the moment a person receives a thing
belonging to another, with the obligation of safely keeping it and returning the same. Further, the
deposit of effects made by travelers in hotels or inns shall also be regarded as necessary. The keepers
of hotels or inns shall be responsible for them as depositaries, provided that notice was given to them,
or to their employees, of the effects brought by the guests and that, on the part of the latter, they take
the precautions which said hotel-keepers or their substitutes advised relative to the care and
vigilance of their effects.
Plainly, the insured See deposited his vehicle for safekeeping with Durban, through the
latter’s employee, Justimbaste. In turn, Justimbaste issued a claim stub to See. Thus, the contract of
deposit was perfected from See’s delivery, when he handed over to Justimbaste the keys to his
vehicle, which Justimbaste received with the obligation of safely keeping and returning it. Ultimately,
petitioner is liable for the loss of See’s vehicle.
Guaranty
STAR TWO (SPV-AMC), INC. v. HOWARD KO, MIN MIN SEE KO, JIMMY ONG, and GRACE NG ONG
G.R. No. 185454, 23 March 2011, SECOND DIVISION (NACHURA, J.)
A surety (or guarantor) may bind himself for less, but not for more than the principal debtor,
both as regards the amount and the onerous nature of the conditions.
Jianshe Motorcycle Industries Philippines Corporation (Jianshe) obtained various loans from
Rizal Commercial Banking Corporation (RCBC) from 2003-2004 to finance its importation of
motorcycles, and other related goods. To secure said goods, RCBC required Jianshe to execute trust
receipts over these goods. Moreover, to secure payment of all existing and future obligations of
Jianshe to RCBC, Howard Ko, Jimmy Ong, Min Min See Ko, and Grace Ng Ong (Ko, et al.) executed a
comprehensive surety agreement with a limited liability of P50M.
Jianshe failed to pay its obligations. Thus, RCBC filed a complaint for specific performance
with prayer for a writ of preliminary attachment against Jianshe as principal, and Ko, et al. as sureties.
A writ of preliminary attachment was issued against all the properties of Jianshe and Ko, et al. as may
be sufficient to satisfy RCBC’s principal claim of P25,636,339.40. Upon motion of Ko, et al., the trial
court ordered the discharge of the attachment, and granted the motion to dismiss. In dismissing the
case, the trial court stated that there was sufficient evidence to prove that Howard Ko paid an amount
more than the limit provided under the comprehensive surety agreement.
RCBC filed a Manifestation/Substitution of Parties, considering that it had sold, transferred,

and assigned all its rights and interests in the present case to Star Two (SPV-AMC), Inc. SPV-AMC
elevated the matter to the Court of Appeals (CA). The CA ruled against SPV-AMC. Hence, this petition.
ISSUE:
Whether or not the case should be dismissed since the claim set forth in the complaint has
been paid or otherwise extinguished.
RULING:
YES. Pursuant to Article 2054 of the Civil Code that “a guarantor [or surety] may bind himself
for less, but not for more than the principal debtor, both as regards the amount and the onerous
nature of the conditions,” Ko, et al. limited their liability to P50M, which is less than Jianshe’s liability
to RCBC. Howard Ko complied with his obligations and made payments to RCBC.
The Court noted that the pieces of evidence presented by Ko, et al. were documents, such as
official receipts, trust debit advices, and passbooks, issued by no less than SPV-AMC itself. Payments
were made by Ko, et al. through the active participation of RCBC, primarily by debiting the subject
amounts from Ko, et al.’s accounts with the bank.
Admittedly, it was Jianshe, as the principal, which owed RCBC. Nowhere in SPV-AMC’s
pleadings was it claimed that Ko, et al. also owed the bank aside from their obligation as surety to
secure the principal obligation of Jianshe. Undoubtedly, the debited amounts from Howard Ko’s
accounts were made to satisfy his obligation as surety. SPV-AMC cannot now claim that the payments
were made by Jianshe as principal and not by Ko, et al. as sureties simply because the receipts were
issued in the name of Jianshe.
Pledge
UNION BANK OF THE PHILIPPINES v. ALAIN JUNIAT, et al.

G.R. No. 171569, 1 August 2011, FIRST DIVISION (Del Castillo, J.)
To have a binding effect on third parties, a contract of pledge must appear in a public instrument.
Union Bank filed with the RTC of Makati a Complaint with prayer for the issuance of ex-parte
writs of preliminary attachment and replevin against Winwood Apparel, Inc. (Winwood), Wingyan
Apparel, Inc. (Wingyan) and Alain Juniat (Juniat) its owner and operator as well as the person in
possession of the mortgaged motorized sewing machines and equipment. Union Bank alleged that
Juniat, acting for and in behalf of Winwood and Wingyan, executed a promissory note and a Chattel
Mortgage over several motorized sewing machines and other allied equipment to secure their
obligation arising from export bills transactions to petitioner in the amount of P1,131,134.35; that as
additional security for the obligation, Juniat executed a Continuing Surety Agreement in favor of
petitioner; that the loan remains unpaid; and that the mortgaged motorized sewing machines
are insufficient to answer for the obligation.
The RTC issued writs of preliminary attachment and replevin in favor of Union
Bank. Although Nonwoven was not impleaded in the complaint filed by petitioner, the RTC likewise
served summons upon Nonwoven since it was in possession of the motorized sewing machines and
equipment. Nonwoven filed an Answer contending that the unnotarized Chattel Mortgage executed
in favor of Union Bank has no binding effect on Nonwoven and that it has a better title over the
motorized sewing machines and equipment because these were assigned to it by Juniat pursuant to
their Agreement. Juniat, Winwood, and Wingyan, on the other hand, were declared in default for
failure to file an answer within the reglementary period.
Union Bank filed a Motion to Sell Chattels Seized by Replevin, praying that the motorized
sewing machines and equipment be sold to avoid depreciation and deterioration. Before the RTC
could act on the motion, Union Bank sold the attached properties for the amount of P1,350,000.00.
Nonwowen moved to cite the officers of petitioner in contempt for selling the attached properties,
but the RTC denied the same on the ground that Union Bank acted in good faith.
The RTC ruled in favor of Union Bank. On appeal, the CA reversed the ruling of the RTC. The
CA ruled that the contract of pledge entered into between Juniat and Nonwoven is valid and binding,
and that the motorized sewing machines and equipment were ceded to Nonwoven by Juniat by virtue
of a dacion en pago, the CA declared Nonwoven entitled to the proceeds of the sale of the attached
properties.
ISSUE
Whether Union Bank has a better right over the proceeds of the sale
RULING
YES. Indeed, the unnotarized Chattel Mortgage executed by Juniat, for and in behalf of
Wingyan and Winwood, in favor of petitioner does not bind Nonwoven. However, it must be pointed
out that petitioner’s primary cause of action is for a sum of money with prayer for the issuance of ex-
parte writs of attachment and replevin against Juniat, Winwood, Wingyan, and the person in
possession of the motorized sewing machines and equipment. Thus, the fact that the Chattel
Mortgage executed in favor of petitioner was not notarized does not affect petitioner’s cause of
action. Petitioner only needed to show that the loan of Juniat, Wingyan and Winwood remains unpaid
and that it is entitled to the issuance of the writs prayed for. Considering that writs of attachment and
replevin were issued by the RTC, Nonwoven had to prove that it has a better right of possession or
ownership over the attached properties. This it failed to do.
A perusal of the Agreement dated May 9, 1992 clearly shows that the sewing machines, snap
machines and boilers were pledged to Nonwoven by Juniat to guarantee his obligation. However,
under Article 2096 of the Civil Code, [a] pledge shall not take effect against third persons if a
description of the thing pledged and the date of the pledge do not appear in a public
instrument. Hence, just like the chattel mortgage executed in favor of petitioner, the pledge executed
by Juniat in favor of Nonwoven cannot bind the petitioner.
No evidence was presented by Nonwoven to show that the attached properties were
subsequently sold to it by way of a dacion en pago. Also, there is nothing in the Agreement dated May
9, 1992 to indicate that the motorized sewing machines, snap machines and boilers were ceded to
Nonwoven as payment for the Wingyan’s and Winwood’s obligation. It bears stressing that there can
be no transfer of ownership if the delivery of the property to the creditor is by way of security. In fact,
in case of doubt as to whether a transaction is one of pledge or dacion en pago, the presumption is
that it is a pledge as this involves a lesser transmission of rights and interests.
Real Estate Mortgage
SUPREME TRANSLINER, INC., MOISES C. ALVAREZ and PAULITA S. ALVAREZ v. BPI FAMILY
SAVINGS BANK, INC
G.R. No. 165617/165837, 25 February 2011, THIRD DIVISION (Villarama, J.)
In foreclosure sale, there is no actual transfer of the mortgaged real property until after the
expiration of the one-year redemption period as provided in Act No. 3135 and title thereto is
consolidated in the name of the mortgagee in case of non-redemption.
Supreme Transliner, Inc. obtained a loan in the amount of P9,853,000.00 from BPI Family
Savings Bank with a 714-square meter lot as collateral. For non-payment of the loan, the mortgage
was extrajudicially foreclosed and the property was sold to the bank as the highest bidder in the
public auction. Before the expiration of the one-year redemption period, the mortgagors notified the
bank of their intention to redeem the property. Accordingly, a Statement of Account was prepared by
the bank indicating the total amount due under the mortgage loan agreement in the amount of P
15,704,249.12. The mortgagors requested for the elimination of liquidated damages and reduction
of attorneys fees and interest (1% per month) but the bank refused. On May 21, 1997, the mortgagors
redeemed the property by paying the sum of P15,704,249.12. The mortgagors filed a complaint
against the bank to recover the allegedly unlawful and excessive charges totaling P5,331,237.77, with
prayer for damages and attorney’s fees.
The petitioners-mortgagors raise the single issue of whether the foreclosing mortgagee
should pay capital gains tax upon execution of the certificate of sale, and if paid by the mortgagee,
whether the same should be shouldered by the redemptioner. They specifically prayed for the return
of all asset-acquired expenses consisting of documentary stamps tax, capital gains tax, foreclosure
fee, registration and filing fee, and additional registration and filing fee totaling P906,142.79, with
6% interest thereon from May 21, 1997.
ISSUES:
1. Whether or not the capital gains tax upon execution of the certificate of sale.
2. Whether or not such capital gains tax should be shouldered by the redemptioner.
RULING:
1. NO, there is no legal basis for the inclusion of this charge in the redemption price. Under
Revenue Regulations (RR) No. 13-85 (December 12, 1985), every sale or exchange or other
disposition of real property classified as capital asset under Section 34(a) of the Tax Code shall be
subject to the final capital gains tax. The term sale includes pacto de retro and other forms of
conditional sale. Section 2.2 of Revenue Memorandum Order (RMO) No. 29-86 (as amended by RMO
No. 16-88 and as further amended by RMO Nos. 27-89 and 6-92) states that these conditional sales
necessarily include mortgage foreclosure sales (judicial and extrajudicial foreclosure sales). Further,
for real property foreclosed by a bank on or after September 3, 1986, the capital gains tax and
documentary stamp tax must be paid before title to the property can be consolidated in favor of the
bank.
2. Under Section 63 of Presidential Decree No. 1529 otherwise known as the Property
Registration Decree, if no right of redemption exists, the certificate of title of the mortgagor shall be
cancelled, and a new certificate issued in the name of the purchaser. But where the right of
redemption exists, the certificate of title of the mortgagor shall not be cancelled, but the certificate of
sale and the order confirming the sale shall be registered by brief memorandum thereof made by the
Register of Deeds upon the certificate of title. In the event the property is redeemed, the certificate
or deed of redemption shall be filed with the Register of Deeds, and a brief memorandum thereof
shall be made by the Register of Deeds on the certificate of title.
It is therefore clear that in foreclosure sale, there is no actual transfer of the mortgaged real
property until after the expiration of the one-year redemption period as provided in Act No. 3135
and title thereto is consolidated in the name of the mortgagee in case of non-redemption. In the
interim, the mortgagor is given the option whether or not to redeem the real property. The issuance
of the Certificate of Sale does not by itself transfer ownership.
SPOUSES FERNANDO and ANGELINA EDRALIN v. PHILIPPINE VETERANS BANK

G.R. No. 168523 09 March 2011, FIRST DIVISION (Del Castillo, J.)
The right to possess a property follows the right of ownership; consequently, it would be illogical
to hold that a person having ownership of a parcel of land is barred from seeking possession thereof.
Philippine Veterans Bank (PVB) is a commercial banking institution created by law. PVB
granted Spouses Fernando and Angelina Edralin (Edralins) a loan in the amount of P270,000.00. As
security thereof, the Edralins executed a Real Estage Mortgage (REM) in favor of PVB over a real
property in Paranaque and owned by Fernando Edralin. The REM was registered accordingly.
When the Edralins failed to pay their obligations, PVB filed a petition for extrajudicial
foreclosure. In due course, the foreclosure sale was held. PVB emerged as the highest bidder, and was
issued the corresponding certificate of sale. Upon the the Edralins’ failure to redeem the property
during the one-year period provided under Act No. 3135, PVB acquired absolute ownership of the
subject property. Consequently, PVB caused the consolidation of ownership of the subject property
in its name. A transfer certificate title was issued in favor of PVB.
Despite the foregoing, the Edralins failed to vacate and surrender possession of the subject
property to PVB. Thus, on May 24, 2006 PVB filed an ex-parte petition for the issuance of a writ of
possession. However, the same was dismissed for failure of PVB to prosecute.
On July 29, 2003, PVB again filed an ex-parte petition for the issuance of a writ of possession.
The Edralins moved to dismiss the petition on the ground of res judicata.
The trial court dismissed PVB’s application. The trial court explained that, under paragraph
(d) of the REM, PVB agreed to take possession of the Edralins’ property without any judicial
intervention. The trial court held that, assuming the contract allowed for the issuance of a writ of
possession, PVB’s right to seek possession had already prescribed. Without citing authority and
adequate explanation, the court held that PVB had only 10 years from February 24, 1983 to seek
possession of the property.
PVB filed a petition for mandamus with prayer for issuance of a preliminary mandatory
injunction before the Court of Appeals (CA). The CA ruled in favor of PVB. It held that the contractual
provision in paragraph (d) to immediately take possession of the mortgaged property without need
of judicial intervention is distinct from the right to avail of extrajudicial foreclosure under Section 7
of Act No. 3135, which was expressly reserved by PVB in paragraph (c) of the REM. Having availed
itself of the remedy of extrajudicial foreclosure, PVB, as the highest bidder, has the right to a writ of
possession. This right may be availed of any time after the buyer consolidates ownership. In fact, the
issuance of the writ of possession is a ministerial function, the right to which cannot be enjoined or
stayed, even by an action for annulment of the mortgage or the foreclosure sale itself. Hence, this
petition for review filed by the Edralins.
ISSUES:
Whether or not the issuance of the writ of possession under Act No. 3135 is subject to the
statute of limitations.
RULING:
NO. The Court has held before that the purchaser’s right “to request for the issuance of the
writ of possession of the land never prescribes.” “The right to possess a property merely follows the
right of ownership,” and it would be illogical to hold that a person having ownership of a parcel of
land is barred from seeking possession thereof.
Moreover, the provisions cited by the Edralins refer to prescription of actions. An action is
“defined as an ordinary suit in a court of justice, by which one party prosecutes another for the
enforcement or protection of a right, or the prevention or redress of a wrong.” On the other hand, “a
petition for the issuance of the writ, under Section 7 of Act No. 3135, as amended, is not an ordinary
action filed in court, by which one party ‘sues another for the enforcement or protection of a right, or
prevention or redress of a wrong.’ It is in the nature of an ex parte motion in which the court hears
only one side. It is taken or granted at the instance and for the benefit of one party, and without notice
to or consent by any party adversely affected. Accordingly, upon the filing of a proper motion by the
purchaser in a foreclosure sale, and the approval of the corresponding bond, the writ of possession
issues as a matter of course and the trial court has no discretion on this matter.”
SPOUSES HERMES P. OCHOA and ARACELI D. OCHOA v. CHINA BANKING CORPORATION

G.R. No. 192877, 23, March 2011, SECOND DIVISION (NACHURA, J.)
With respect to the venue of extrajudicial foreclosure sales, Act No. 3135, as amended, applies,
it being a special law dealing particularly with extrajudicial foreclosure sales of real estate mortgages,
and not the general provisions of the Rules of Court on Venue of Actions—stipulated venue is relevant
only to actions arising from or related to the mortgage, such as a complaint for Annulment of
Foreclosure, Sale, and Damages.
Spouses Hermes P. Ochoa and Araceli D. Ochoa (the Ochoas), and China Banking Corporation
(China Bank) entered a mortgage contract. The mortgage contract stipulated Makati City as the
exclusive venue of any suit arising from the said contract.
The Court of Appeals (CA) ruled that the stipulated exclusive venue of Makati City is binding
only on the Ochoas’ complaint for Annulment of Foreclosure, Sale, and Damages filed before the
Regional Trial Court of Parañaque City, but not on China Bank’s Petition for Extrajudicial Foreclosure
of Mortgage, which was filed with the same court.
Aggrieved, the Ochoas filed a petition for review on certiorari before the Supreme Court,
which was denied. Hence, this motion for reconsideration.
ISSUE:
Whether or not the CA erred in its ruling.
RULING:
NO. The case at bar involves the Ochoas’ mortgaged real property located in Parañaque City
over which China Bank was granted a special power to foreclose extrajudicially. Thus, by express
provision of Section 2 of Act No. 3135, as amended, the sale can only be made in Parañaque City.
The exclusive venue of Makati City, as stipulated by the parties and sanctioned by Section 4,
Rule 4 of the Rules of Court, cannot be made to apply to the Petition for Extrajudicial Foreclosure filed
by China Bank because the provisions of Rule 4 pertain to venue of actions, which an extrajudicial
foreclosure is not.
Verily then, with respect to the venue of extrajudicial foreclosure sales, Act No. 3135, as
amended, applies, it being a special law dealing particularly with extrajudicial foreclosure sales of
real estate mortgages, and not the general provisions of the Rules of Court on Venue of Actions.
Consequently, the stipulated exclusive venue of Makati City is relevant only to actions arising
from or related to the mortgage, such as petitioners’ complaint for Annulment of Foreclosure, Sale,
and Damages.
RURAL BANK OF TOBOSO, INC. (now UCPB Savings Bank) v. JEAN VENIEGAS AGTOTO
G.R. No. 175697, 23 March 2011, SECOND DIVISION (ABAD, J.)
Where the bank collected the entire amount of the loan from the proceeds of the foreclosure
sale, including the portion that was not covered by the real estate mortgage, it must return the excess
amount to the mortgagor.
Jean Veniegas Agtoto (Agtoto) executed a special power of attorney (SPA) authorizing her
husband, Rodney, to secure a loan on her behalf and mortgage a registered land that she owned. Using
the SPA, Rodney got a loan of P130,500.00 from the Rural Bank of Toboso, Inc. (the Bank), with the
P61,068.00 portion secured by a real estate mortgage on his wife’s land. The remaining P69,432.00
of the loan was secured with a chattel mortgage over two service boats and one Yanmar Marine
engine.
After paying only P14,500.00, Agtoto failed to pay her loan with the Bank. The Bank
extrajudicially foreclosed the mortgage on Agtoto’s land pegging her debt at P130,500.00 plus
interest. The land was sold at public auction, to which the Bank emerged as the highest bidder. A
certificate of sale was subsequently issued.
Later, Agtoto filed a complaint against the Bank for the annulment of the sale of her land. The
trial court rendered a decision, ordering the Bank to pay Agtoto P305,000.00, which was its bid for
her land, less the P61,068.00 due from her loan. Thereafter, the trial court issued an order, amending
the dispositive portion of its decision to include an award of 6% interest per annum on the amount
of the award, counted from the date of the auction sale until Agtoto would have been fully paid; and
that her previous payment of P14,500.00 could not be deducted from the principal loan.
Thus, Agtoto appealed to the Court of Appeals (CA). The CA affirmed the trial court’s decision
with modification in that it awarded to Agtoto P189,497.10 plus 12% interest per annum from
January 29, 1992 or the date of judicial demand until full payment. Hence, this petition.
ISSUE:
Whether or not the Bank should pay P189,497.10 to Agtoto as excess bid proceeds with 12%
interest per annum, computed from January 29, 1992, the date of judicial demand, until the award is
fully paid.
RULING:
YES. The Court found no reason to deviate from the CA’s ruling that the proceeds of the
foreclosure sale should be applied to satisfy only the debt and related charges that the foreclosed
land secured. Since the Bank collected the entire amount of the loan from the proceeds of the
foreclosure sale, including the portion that was not covered by the real estate mortgage, it must
return such to Agtoto, which amounted to P189,497.10 (P305,000.00 less the P115,502.90 portion
covered by the real estate mortgage.)
Although the Bank insisted that no excess amount remained out of the proceeds of its winning
bid after payment of what was due it, it miserably failed to present evidence to substantiate its
assertion. The Court cannot simply ignore the importance of surplus foreclosure sale proceeds
because they stand in the place of the land itself and are constructively, at least, real property that
belongs to the mortgagor.
Since the excess amount that the Bank withheld may be regarded in equity as the equivalent
of a forbearance of money, given that it charged the borrower interest for the same, the Bank should
be made to pay 12% interest on it until fully paid. Such interest should, however, be computed only
from the time the CA rendered its decision on October 27, 2005 when it determined with reasonable
certainty the amount of the surplus proceeds the Bank has to return to Agtoto.
JOSEFA S. ABALOS AND THE DEVELOPMENT BANK OF THE PHILIPPINES v. SPS. LOMANTONG
DARAPA AND SINAB DIMAKUTA
The 10-year prescriptive period applies only when the reconveyance is based on fraud which
makes a contract voidable (and that the aggrieved party is not in possession of the land whose title is to
be actually reconveyed)—it does not apply to an action to nullify a contract which is void ab initio.
The Development Bank of the Philippines (DBP) granted a P31,000.00 loan to spouses
Lomantong Darapa and Sinab Dimakuta (the Spouses). The loan was secured by a real and chattel
mortgage contract which covered: (1) a warehouse to house rice and corn mill; and (2) the equity
rights and interest of the Spouses over a parcel of land on which the warehouse is constructed. It is
further the agreement of the parties that immediately after the Spouses acquire absolute ownership
of the land mentioned on which the warehouse is erected by means of a free or sales patent or any
other title vesting them with ownership in fee simple, the mortgagors shall execute a Real Estate
Mortgage thereon in favor of DBP to replace and substitute the equity rights.
The Spouses applied for the renewal and increase of their loan using Sinab Dimakuta’s
(Dimakuta) transfer certificate title (TCT) No. T-1,997 as additional collateral. The DBP disapproved
the loan application without returning, however, TCT No. T-1,997. When the Spouses failed to pay
their loan, DBP extrajudicially foreclosed the mortgages which, unknown to the Spouses, included
TCT No. T-1,997. The Spouses failed to redeem the land under TCT No. T-1,997 which led to its
cancellation, and eventual issuance of another transfer certificate of title in DBP’s name.
When the Spouses discovered all these, they sought for the reconveyance of the land. Initially,
the bank assured them of the return of the land. However, later on, the Spouses were informed that
such return is no longer possible since the land has already been bought by Josefa S. Abalos (Abalos),
daughter of the then provincial governor.
Hence, the Spouses filed a complaint for annulment of title, recovery of possession and
damages, against DBP and Abalos. The trial court annulled the DBP’s foreclosure sale of the land
under TCT No. T-1,997 and its sale to Abalos. The DBP and Abalos assailed the trial court’s decision
before the Court of Appeals (CA); Abalos, however, later abandoned her appeal. The CA denied the
petition, and ruled that DBP had no right to foreclose the land under TCT No. T-1,997, it not having
been mortgaged. Hence, this petition. DBP avers that the land covered by Tax Declaration No. A-148
mortgaged in 1962, then untitled, is the same land now covered by TCT No. T-1,997.
ISSUE:
1. Whether or not DBP has the right to foreclose the land under TCT No. T-1,997.
2. Whether or not the Spouses’ cause of action is barred by prescription, laches and estoppel.
RULING:
1. NO. The records reveal that the land covered by TCT No. T-1,997 was not among the
properties the spouses mortgaged with the DBP in 1962.
No less than the 1962 mortgage contract and its accompanying deed of assignment show that
the land covered by Tax Declaration No. A-148 is located in Linamon, Lanao del Norte with an area
of 357 square meters and bounded “on the north by Rafael Olaybar; on the south, by National Road;
on the east by Ulpiano Jimenez; and, on the west, by Rafael Olaybar.”
On the other hand, the land covered by TCT No. T-1,997 is situated in Barrio Buruan,
Municipality of lligan, Lanao del Norte and contains an area of 342 square meters. TCT No. T-1,997
traces its roots in Original Certificate of Title (OCT) No. RP-407 (244), pursuant to a Homestead
patent granted by the President of the Philippines in 1933 under Act No. 2874, and which was
registered as early as 26 June 1933 as recorded in Registration Book No. 1, page 137 of the Office of
the Register of Deeds, Lanao del Norte.
Needless to say, the bank utterly failed to establish, by preponderance of evidence, that TCT No.
T-1,997 originated from Tax Declaration No. A-148.
2. NO. In the present petition, it cannot be concluded that the Spouses are guilty of estoppel for
the requisites are not attendant. Moreover, the records as established by the trial court show that it
was rather the DBP’s tactic which delayed the institution of the action. DBP made the Spouses believe
that there was no need to institute any action for the land would be returned to the spouses soon,
only to be told, after ten (10) years of naiveté, that reconveyance would no longer be possible for the
same land was already sold to Abalos, an alleged purchaser in good faith and for value.
The Court disagreed with the DBP’s contention that for failure to institute the action within ten
years from the accrual of the right thereof, prescription has set in, barring the Spouses from
vindicating their transgressed rights.
The 10-year prescriptive period applies only when the reconveyance is based on fraud which
makes a contract voidable (and that the aggrieved party is not in possession of the land whose title
is to be actually, reconveyed). It does not apply to an action to nullify a contract which is void ab initio,
as in the present petition. Article 1410 of the Civil Code categorically states that an action for the
declaration of the inexistence of a contract does not prescribe.
The spouses’ action is an action for “Annulment of Title, Recovery of Possession and Damages,”
grounded on the theory that the DBP foreclosed their land covered by TCT No. T-1,997 without any
legal right to do so, rendering the sale and the subsequent issuance of TCT in DBP’s name void ab
initio and subject to attack at any time conformably to the rule in Article 1410 of the Civil Code.
VIOLA CAHILIG and ANTONIO G. SIEL, JR. v. HON. EUSTAQUIO G. TERENCIO, et al.
G.R. No. 164470, 28 November 2011, FIRST DIVISION (Leonardo-De Castro, J.)
The obligation of the court to issue an ex parte writ of possession in favor of the purchaser in an
extrajudicial foreclosure sale ceases to be ministerial once it appears that there is a third party in
possession of the property who is claiming a right adverse to that of the debtor/mortgagor. However,
such third-party claim must be presented at the onset of the litigation to prosper.
Soterania G. Siel executed deeds of real estate mortgage covering a portion of Lot 402, in favor
of Moneytrend Lending Corporation, as security for two promissory notes. Moneytrend Lending
Corporation assigned the promissory notes and deeds of real estate mortgage to Mercantile Credit
Resources Corporation. In view of the non-payment of the loans, Mercantile Credit Resources
Corporation caused the extrajudicial foreclosure of the mortgages. It then acquired the mortgaged
property as the highest bidder. Soterania Siel failed to redeem the property within the prescribed
period and a final deed of sale was issued by the Sheriff. Mercantile Credit Resources Corporation
filed with the Regional Trial Court an ex-parte motion for the issuance of a writ of possession over
the subject property. The motion was granted and the Judge directed the Sheriff to place Mercantile
Credit Resources Corporation in possession of the subject property. The writ of possession was
implemented by Sheriff Victor B. Beluso by serving a notice to vacate on Viola Cahilig, who manifested
that she could turn over only her 1/6 share over the property as the other shares do not belong to
her. The Sheriff received a third party claimants affidavit executed by Antonio Siel, Jr., who claimed
that he and his siblings bought the property from their mother, Soterania Siel. Mercantile Credit
Resources Corporation filed a motion for the issuance of an alias writ of possession. Said motion was
opposed by Viola Cahilig and Antonio G. Siel, Jr. alleging that they and their siblings have been the
owners of the property since 1993, that is, before the mortgage was constituted. The motion for the
issuance of an alias writ of possession was granted and the Sheriff was directed to implement the
same, with police assistance if necessary. Cahilig and Siel, Jr.’s motion for reconsideration, motion for
inhibition and motion to quash the alias writ of possession were denied. Cahilig and Siel, Jr. instituted
a special civil action for certiorari alleging grave abuse of discretion on the part of Judge Eustaqio G.
Terencio for not quashing the alias writ of possession in view of their third-party claim and
irregularities in the mortgage transactions as the loans were allegedly not obtained by Soterania Siel
but by Viola Cahilig and Shirley Candolita. They also prayed for the issuance of a restraining order to
enjoin the implementation of the alias writ of possession. The Court of Appeals ruled in the negative
and dismissed the petition for certiorari for lack of merit. A motion for reconsideration was filed by
Cahilig and Siel, Jr but this was denied by the Court of Appeals.
ISSUE:
Whether the issuance of the writ of possession over the property subject of the foreclosure
of the real estate mortgage is proper.
RULING:
YES. As previously held in Villanueva v. Cherdan Lending Investors Corporation:
A writ of possession is an order of the court commanding the sheriff to place a person
in possession of a real or personal property. It may be issued in an extrajudicial
foreclosure of a real estate mortgage under Section 7 of Act 3135, as amended by Act
4118, either 1) within the one-year redemption period, upon the filing of a bond, or
2) after the lapse of the redemption period, without need of a bond or of a separate
and independent action.
Moreover, in Asia United Bank v. Goodland Company, Inc., it is pointed out that:
It is a time-honored legal precept that after the consolidation of titles in the buyer’s
name, for failure of the mortgagor to redeem, entitlement to a writ of possession
becomes a matter of right. As the confirmed owner, the purchaser’s right to
possession becomes absolute. There is even no need for him to post a bond, and it is
the ministerial duty of the courts to issue the same upon proper application and proof
of title. To accentuate the writs ministerial character, the Court has consistently
disallowed injunction to prohibit its issuance despite a pending action for
annulment of mortgage or the foreclosure itself.
In the case at bar, there is no dispute that private respondent caused the extrajudicial
foreclosure of the real estate mortgage pursuant to Section 7 of Act 3135, as amended by Act 4118,
over the property at issue after Soterania Siel defaulted on her loan payments when they became due
under the promissory notes she had executed. It is likewise undisputed that private respondent
purchased the same property at the extrajudicial foreclosure sale and, as a result thereof, a certificate
of sale was issued in its favor. Following Soterania Siel’s failure to redeem the property within the
prescribed period, a final deed of sale was issued by the Sheriff in the name of private respondent.
In a number of cases, it is held that the obligation of the court to issue an ex parte writ of
possession in favor of the purchaser in an extrajudicial foreclosure sale ceases to be ministerial once
it appears that there is a third party in possession of the property who is claiming a right adverse to
that of the debtor/mortgagor.
However, unlike in those cases, the third-party claim in the instant case was not presented at
the onset of litigation. In fact, it was not the original theory propounded by petitioners when they
filed a motion for reconsideration of the Order dated June 29, 2001 issued by the trial court which
first granted the writ of possession in private respondents favor. More importantly, the judicial
admissions made by petitioners in their motion were wholly incompatible with their belated claim
that they are actually vendees of Soterania Siel’s property.
BPI FAMILY SAVINGS BANK, INC. v. MA. AVRLYN T. AVENIDO & PACIFACIO A. AVENIDO
G.R. No. 175816, 7 December 2011, EN BANC (Leonardo-De Castro, J.)
If the proceeds of the sale are insufficient to cover the debt in an extrajudicial foreclosure of
mortgage, the mortgage is entitled to claim the deficiency from the debtor.
Bank of the Philippine Islands Family Savings Bank (BPI Family) filed a complaint for
collection of deficiency mortgage obligation against Pacifico and Ma. Arlyn Avenido (Spouses
Avenido). BPI Family alleged that the spouses obtained a loan in the amount of PhP2 million pesos,
secured by a real estate mortgage. When the spouses failed to pay their loan obligation despite
demand, BPI Family instituted extrajudicial foreclosure proceedings over the mortgaged property of
the spouses, in accordance with Act No. 3135. At the public auction, BPI Family was declared the
highest bidder for the property. The bid price was PhP2,142,616 was applied as partial payment of
the mortgage obligation, leaving PhP794,765.43 unpaid.
BPI Family prayed that the Regional Trial Court (RTC) order the Spouses Avenido to pay the
deficiency of their mortgage obligation, plus legal interest. In their Answer, the spouses averred that
they have already paid a substantial amount to BPI Family but, due to the latter's imposition of
unreasonable charges and penalties on their principal obligation, their payments seemed
insignificant. They argued that their indebtedness only amounted to less than PhP2 million, and the
amount was fully covered when the foreclosure was sold at public auction. As such, the spouses
prayed for the dismissal of the case against them.
In their decision, the RTC reduced the total loan of the obligation of the spouses, and denied
the claim for deficiency of BPI Family. The Court of Appeals (CA) concurred with the RTC's decision.
ISSUE:
Whether BPI Family is still entitled to collect the deficiency mortgage obligation from Spouses
Avenido.
RULING:
YES. While Act No. 3135, as amended, does not discuss the mortgagee’s right to recover the
deficiency, neither does it contain any provision expressly or impliedly prohibiting recovery. Absent
such a provision in Act No. 3135, as amended, the creditor is not precluded from taking action to
recover any unpaid balance on the principal obligation simply because he chose to extrajudicially
foreclose the real estate mortgage. Therefore, BPI Family may still collect the said deficiency without
violating the principle of unjust enrichment.
RAMONA RAMOS and THE ESTATE OF LUIS T. RAMOS v. PHILIPPINE NATIONAL BANK, et al.
The amounts named as consideration in a contract of mortgage do not limit the amount for
which the mortgage may stand as security if, from the four corners of the instrument, the intent to secure
future and other indebtedness can be gathered.
In 1973, Luis Ramos (Luis) obtained a credit line from the Philippine National Bank (PNB) for
PhP 83,000. To secure the loan, he executed a Real Estate Mortgage covering three parcels of land.
The contract stipulated that it shall stand as security for all subsequent promissory notes and
obligation, of whatever kind and nature.
On March 31, 1989, Luis and PNB entered into another cred line agreement in the amount of
PhP 50 million under the bank's sugar quedan financing program. Purusuant to their agreement, Luis
obtained an availment of PhP7.8 million, as evidenced by a promissory note. He executed a Contract
of Pledge in favor of PNB. He pledged as security the two official warehouse receipts for refined sugar
issued by Noah's Ark Sugar Refinery (Noah's Ark). Luis procured another availment for the same
amount shortly thereafter, and for which he executed another Contract of Pledge. Luis eventually
failed to settle his sugar quedan financing loans amounting to PhP 15.6 million. He issued an
Authorization in favor of PNB, stating that he authorized PNB and its duly-authorized officers, to
dispose and sell all the Quedan Receipts pledged to the bank.
On August 7, 1989, spouses Luis and Ramona Ramos (Spouses Ramos) also obtained an
agricultural loan of PhP 160,000 from PNB, as evidenced by a promissory note. This was secured by
a real estate mortgage. The spouses fully settled the agricultural loan in 1990. However, when they
demand the release of the real estate mortgage, the latter refused to heed their demand. This
prompted them to file a complaint for Specific Performance against PNB. In their complaint, they
claimed that the actions of PNB impaired the rights in the property, and caused them to lose business
opportunities. PNB countered that the Spouses Ramos had no cause of action because they knew that
the mortgage secured not only the PhP160,000 they loaned, but also the other loans the spouses
obtained from the bank -- i.e., the sugar quedan financing loan of PhP 15.6 million that remained
unpaid. As PNB remained unable to collect on the quedans because the quedans were dishonored by
the warehouseman, it claimed that the spouses Ramos' loan obligation had yet to be satisfied.
The Regional Trial Court (RTC) ruled in favor of the Spouses Ramos, holding that the
authorization issued by Luis in favor of PNB, which gave the latter the right to dispose of the property,
totally terminated the contract of pledge between him and PNB. In effect, there was a novation of
their agreement and a dacion in payment set between the parties, thereby extinguishing the loan
obligation. However, the Court of Appeals (CA) reversed the RTC's decision, noting that the
authorization letter did not provide that the ownership of the goods pledge would pass to PNB in
case of failure of the spouses to pay the loan on time. The authorization merely provided for the
appointment of PNB as the attorney-in-fact with authority, among others, to sell or dispose of the real
rights.
ISSUE:
Whether the sugar quedan loans are covered by the real estate mortgage.
RULING:
YES. Obligations arising from contracts have the force of law between the contracting parties
and should be complied with in good faith. When the terms of a contract are clear and leave no doubt
as to the intention of the contracting parties, the literal meaning of its stipulations governs.
In this case, it cannot be denied that the real estate mortgage executed by the parties provided
that it shall stand as security for any subsequent promissory note or obligation of the mortgagor to
the mortgage, whether such obligations have been contracted before, during, or after the constitution
of the mortgage. Thus, from the clear and unambiguous terms of the mortgage contract, the same has
application even to future loans and obligations of the mortgagor of any kind, not only agricultural
crop loans.
As a general rule, a mortgage liability is usually limited to the amount mentioned in the
contract. However, the amounts named as consideration in a contract of mortgage do not limit the
amount for which the mortgage may stand as security if, from the four corners of the instrument, the
intent to secure future and other indebtedness can be gathered. This stipulation is valid and binding
between the parties and is known as the “blanket mortgage clause”.
Mortgagee in Good/Bad Faith
ARMANDO V. ALANO [Deceased], Substituted by Elena Alano-Torres, v. PLANTERS

DEVELOPMENT BANK, as Successor-in-Interest of MAUNLAD SAVINGS and LOAN
ASSOCIATION, INC.
Before approving a loan, the standard practice for banks and other financial institutions is to
conduct an ocular inspection of the property offered to be mortgaged and verify the genuineness of the
title to determine the real owner or owners thereof. Failure to do so makes them mortgagees in bad
faith.
Armando V. Alano (Armando) and his brother, the late Agapito V. Alano, Jr. (Agapito),
inherited from their father a parcel of land located at Gov. Forbes St., Sampaloc, Manila. Armando
executed a Special Power of Attorney authorizing his brother to sell their property in Manila. From
the proceeds of the sale, the brothers purchased on September 22, 1988 a residential house located
at No. 60 Encarnacion St., BF Homes, Quezon City. The title of the Quezon City property, however,
was not immediately transferred to them because the duplicate and original copies of the title were
destroyed by a fire that gutted the Quezon City Hall Building.
On June 27, 1990, Agapito died leaving behind his wife, Lydia J. Alano (Lydia), and four
legitimate children, who adjudicated to themselves the property in Quezon City. Consequently, title
to the said property was reconstituted as Transfer Certificate of Title (TCT) No. 18990 and registered
solely in the names of Lydia and her four children. This prompted Armando to execute an Affidavit of
Adverse Claim which was annotated on TCT No. 18990. But because of the assurance of his nieces
that they would put things right, petitioner agreed to delay the filing of a case in court.
Meanwhile, Lydia filed with the Register of Deeds of Quezon City an Affidavit of Cancellation
of Adverse Claim, which caused the cancellation of the adverse claim annotated on TCT No. 18990.
Thereafter, by virtue of a Deed of Absolute Sale allegedly executed by her children in her favor, TCT
No. 18990 was cancelled and a new one, TCT No. 90388, was issued solely in her name.
On February 8, 1994, Slumberworld, Inc., represented by its President, Melecio A. Javier

(Javier), and Treasurer, Lydia, obtained from Maunlad Savings and Loan Association, Inc. (MSLAI) a
loan of P2.3 million, secured by a Real Estate Mortgage over the property covered by TCT No. 90388.
On April 20, 1994, Armando filed a Complaint against Lydia, Javier, MSLAI and the Register of Deeds
of Quezon City before the Regional Trial Court (RTC) of Quezon City. He sought the cancellation of
TCT No. 90388, the issuance of a new title in his name for his one-half share of the Quezon
City property, and the nullification of real estate mortgage insofar as his one-half share is concerned.
Armando insists that MSLAI is not a mortgagee in good faith as it failed to exercise due
diligence in inspecting and ascertaining the status of the mortgaged property.
On the other hand, MSLAI contends that the issue of being a mortgagee in good faith is a
question of fact, which is beyond the jurisdiction of the Supreme Court. Furthermore, MSLAI claims
no obligation to look beyond the title considering that there was no adverse claim annotated on TCT
No. 90388 covering the mortgaged property. And since the mortgaged property was occupied by the
mortgagor Lydia, there was also no need for Maunlad MSLAI to verify the extent of her possessory
rights.
ISSUE:
Whether or not Maunlad Savings and Loan Association, Inc. is a mortgagee in good faith.
RULING:
NO. Maunlad Savings and Loan Association, Inc. is not a mortgagee in good faith. Hence, the
real estate mortgage executed by Lydia was void with respect to Armando’s co-owners share in the
subject property.
The Court established that Rule 45 of the Rules of Court is not without exception. A review of
factual issues is allowed when there is a misapprehension of facts or when the inference drawn from
the facts is manifestly mistaken. Hence, as this case falls under the exception, the factual issue of
Armando’s allegation that there was a separate apartment at the back portion of the property can
still be raised and is not barred by estoppel.
The general rule that a mortgagee need not look beyond the title, does not apply to banks and
other financial institutions as greater care and due diligence is required of them. Imbued with public
interest, they are expected to be more cautious than ordinary individuals. Thus, before approving a
loan, the standard practice for banks and other financial institutions is to conduct an ocular
inspection of the property offered to be mortgaged and verify the genuineness of the title to
determine the real owner or owners thereof. Failure to do so makes them mortgagees in bad faith.
In the case at bar, Armando contends that MSLAI failed to exercise due diligence in inspecting
and ascertaining the status of the mortgaged property because during the ocular inspection, the
credit investigator failed to ascertain the actual occupants of the subject property and to discover his
apartment at the back portion of the subject property.
Clearly, while the credit investigator conducted an ocular inspection of the property as well
as a neighborhood checking and found the subject property occupied by the mortgagor Lydia and her
children, he, however, failed to ascertain whether the property was occupied by persons other than
the mortgagor. Had he done so, he would have discovered that the subject property is co-owned by
Armando and the heirs of his brother. Since MSLAI was remiss in its duty in ascertaining the status
of the property to be mortgaged and verifying the ownership thereof, it is deemed a mortgagee in
bad faith. Consequently, the real estate mortgage executed in its favor is valid only insofar as the
share of the mortgagor Lydia in the subject property. The Court need not belabor that under Article
493 of the Civil Code, a co-owner can alienate only his pro indiviso share in the co-owned property,
and not the share of his co-owners.
SUCCESSION
Probate of a Will
IN RE: IN THE MATTER OF THE PETITION TO APPROVE THE WILL OF RUPERTA PALAGANAS
WITH PRAYER FOR THE APPOINTMENT OF SPECIAL ADMINISTRATOR; MANUEL MIGUEL
PALAGANAS, et al. v. ERNESTO PALAGANAS
G.R. No. 169144, 26 January 2011 SECOND DIVISION (Abad, J.)
Nowhere in the laws does it specify that a foreign will be probated in the country where it was
executed. The petition for the allowance of a will must show, so far as known to the petitioner: (a) the
jurisdictional facts; (b) the names, ages, and residences of the heirs, legatees, and devisees of the testator
or decedent; (c) the probable value and character of the property of the estate; (d) the name of the
person for whom letters are prayed; and (e) if the will has not been delivered to the court, the name of
the person having custody of it.
On the eight of November 2001, Ruperta Palaganas, a Filipina who became a naturalized
American, died single and childless. In her last will and testament that she executed in the state of
California, she designated her brother, Sergio Palaganas as the executor of her will she left in the
Philippines and in the United States of America (USA).
Meanwhile, Ernesto, another brother of Ruperta, opposed the same and filed a petition for
the probate of Ruperta’s will and for his appointment as the special administrator of her estate. Her
nephews, Manuel and Benjamin, however contended, stating that Ernesto is not qualified to be the
administrator and that their aunt’s will must first be probated in the USA where it is executed.
The Regional Trial Court (RTC) eventually granted to Ernesto to be the special administrator
of his sister’s estate to which the nephews did not accept. The Court of Appeals (CA) likewise affirmed
the decision of the RTC.
ISSUE:
Whether or not a will executed by a foreigner abroad may be probated in

the Philippines although it has not been previously probated and allowed in the country where it was
executed.
RULING:
YES. Nowhere in the laws does it specify that a foreign will be probated in the country where
it was executed. The petition for the allowance of a will must show, so far as known to the petitioner:
(a) the jurisdictional facts; (b) the names, ages, and residences of the heirs, legatees, and devisees of
the testator or decedent; (c) the probable value and character of the property of the estate; (d) the
name of the person for whom letters are prayed; and (e) if the will has not been delivered to the
court, the name of the person having custody of it.
What the brothers may have in mind may be the reprobate of a will before it is admitted in
the Philippines. But the instant case only concerns itself with the probate of a will which is governed
by a different rule in our laws.
LAND TITLES AND DEEDS
HEIRS OF MARGARITO PABAUS v. HEIRS OF AMANDA YUTIAMCO

G.R. No. 164356, 27 July 2011, FIRST DIVISION (Villarama, Jr. J.)
Survey is the process by which a parcel of land is measured and its boundaries and contents
ascertained. A case of overlapping of boundaries or encroachment depends on a reliable, if not accurate,
verification survey.
Three adjoining parcels of land are the subject of the present case. Lots 1 and 2 are registered
in the name of Amanda L. Yutiamco (Yutiamco) under Original Certificate of Title (OCT) No. O-
104 and Transfer Certificate of Title (TCT) No. T-1428, respectively. Lot 2994, Pls-736 is owned by
Margarito Pabaus (Pabaus) and covered by OCT No. P-8649. The lots owned by Yutiamco were issued
pursuant to a judicial decree, while that of Pabaus was issued pursuant to a free patent. The heirs of
Yutiamco filed a Complaint for Cancellation of OCT No. P-8649, Recovery of Possession and Damages
against the heirs of Pabaus. They alleged that the heirs of Pabaus illegally entered upon their lands,
harvested coconuts therein and built a house on the premises, thus encroaching a substantial portion
of Yutiamco’s property. The heirs of Pabaus admitted having gathered coconuts and cut trees on the
contested properties, but asserted that they did so in the exercise of their rights of dominion as
holders of OCT No. P-8649. Three commissioners were appointed to conduct a relocation survey to
determine whether there was overlapping of the properties. The Relocation Survey Report showed
that there was indeed overlapping of the subject lands.
The Regional Trial Court (RTC) ruled in favor of the heirs of Yutiamco. It gave credence to the
finding in the Relocation Survey Report that Pabaus’ lot overlapped Yutiamco’s lands. It held that
since the land in dispute was already under the private ownership of the Yutiamcos and no longer
part of the public domain, the same could not have been the subject of a free patent. The Court of
Appeals (CA) affirmed the RTC ruling and emphasized that the heirs of Pabaus are bound by the
findings contained in the Relocation Survey Report and the Relocation Plan because not only did they
agree to the appointment of the three commissioners but the commissioner representing them also
manifested his conformity to the findings. Since the settled rule is that a free patent issued over a
private land is null and void and produces no legal effects whatsoever, and with the trial court’s
finding that the properties of Yutiamco and Pabaus overlapped as to certain areas, the CA held that
the trial court correctly declared as void the title of the heirs of Pabaus.
ISSUE:
Whether or not the Heirs of Yutiamco were able to prove the claim of overlapping.
RULING:
NO. Survey is the process by which a parcel of land is measured and its boundaries and
contents ascertained; also a map, plat or statement of the result of such survey, with the courses and
distances and the quantity of the land. A case of overlapping of boundaries or encroachment depends
on a reliable, if not accurate, verification survey. To settle the present dispute, the parties agreed to
the conduct of a relocation survey. The Manual for Land Surveys in the Philippines (MLSP) provides
for the rules in conducting relocation surveys. The MLSP laid down specific rules regarding tie lines,
point of reference and overlapping of adjoining titled lands. In this case, records failed to disclose
that the basis for relocating the missing corners was submitted to the Bureau of Lands (now Land
Management Bureau) for verification and approval as required by Section 594. This is crucial
considering that the court-appointed commissioner is a private surveyor and not a government
surveyor from the LRA or LMB-DENR. It bears stressing that in every land dispute, the aim of the
courts is to protect the integrity of and maintain inviolate the Torrens system of land registration, as
well as to uphold the law; a resolution of the parties’ dispute is merely a necessary consequence.
On the part of the heirs of Pabaus, their only evidence to support their opposition to the claim
of encroachment by the heirs of Yutiamco is the cadastral map which indicated the boundary of
Yutiamco’s property at the south of Pabaus’ lot. But as admitted by Engr. De Casa, during the cadastral
survey they conducted from 1986 to 1996, they did not send a written notice to the landowner
Amanda Yutiamco and that she plotted the boundaries of her property based merely on a tax
declaration because the cadastral survey team failed to obtain copies of OCT No. O-104 and TCT No.
T-1428 from the Registry of Deeds. The MLSP specifically required that relocation of boundary lines
is to be made using the bearings, distances and areas approved by the Director of Lands or indicated
in the Torrens titles. Hence, said cadastral map is not competent proof of the actual location and
boundaries of respondents Lots 1 and 2, Psu-213148.
Indeed, the Court has ruled that if the land covered by free patent was a private land, the
Director of Lands has no jurisdiction over it. Such free patent and the subsequent certificate of title
issued pursuant thereto are a nullity. The aggrieved party may initiate an action for cancellation of
such title. Considering, however, that the claim of overlapping has not been clearly established, it is
premature to declare the free patent issued to Margarito Pabaus null and void. Instead, the Court
deems it more appropriate to remand the case to the trial court for the conduct of a
verification/relocation survey under the direction and supervision of the LMB-DENR.
Certificate of Title
ROSALIA N. ESPINO v. SPOUSES SHARON SAMPANI BULUT and CELEBI BULUT

The certificate of title, by itself, does not vest ownership; it is merely an evidence of title over a
particular property.
Spouses Rosalia and Alfredo C. Espino (spouses Espino) are the registered owners of eleven
adjacent lots situated in Tanza, Cavite. Sometime in January 2006, Rosalia N. Espino (Espino) lost the
owner’s duplicate copies of the eleven TCTs. Espino reported the loss to the Register of Deeds (RD).
Espino likewise filed a petition for issuance of new owner’s copies of the eleven TCTs before the trial
court. The trial court granted Espino’s petition. Hence, new copies of the eleven TCTs were issued to
Espino.
Later, spouses Sharon Sampani Bulut and Celebi Bulut (the Buluts) filed with the trial court a
petition from relief from judgment. They aver that they had actual possession of the owner’s copies
of the eleven TCTS. They claim that Espino sold the said lots to on Beauregard E. Lim (Lim).
Thereafter, Lim sold the eleven lots to the Buluts, and gave them the eleven owner’s copies of the
TCTS. When the Buluts tried to register the properties in their name, they discovered the trial court’s
prior Decision and this prompted them to file the present petition.
The trial court granted the Buluts’ petition for the issuance of a writ of preliminary injunction.
The trial court ordered the RD to desist from accepting/registering any document executed by
Espino. Later, the trial court made the injunction permanent and granted the petition for relief from
judgment. The trial court said that “when the original owner’s copy of the title is in fact not lost but
is in the possession of a new owner, being the alleged buyer,” the trial court did not acquire
jurisdiction over Espino’s petition for issuance of new owner’s copies of the eleven titles. Hence, this
petition.
ISSUE:
Whether or not the trial court decided on the issue of ownership of the properties when it
granted the Buluts’ petition.
RULING:
NO. Contrary to Espino’s allegation, the trial court’s 4 September 2006 Decision and the 23
March 2007 Writ of Preliminary Injunction did not declare that the Buluts are the “new owners” of
the properties. While the trial court did restrain the Register of Deeds from accepting or registering
any document executed by Espino and any person authorized by her that will in any way encumber
or cause the transfer of the properties, the trial court did not adjudge respondents as the owners of
the properties. Moreover, the trial court does not have jurisdiction to declare respondents as the
“new owners” of the properties because this is not an issue in a petition for relief from judgment.
In this case, the Buluts’ possession of the eleven TCTs is not necessarily equivalent to
ownership of the lands covered by the TCTs. The certificate of title, by itself, does not vest ownership;
it is merely an evidence of title over a particular property. Again, the issue of ownership of the eleven
properties must be litigated in the appropriate proceedings.
MARIA TORBELA v. SPOUSES ANDRES T. ROSARIO and LENA DUQUE-ROSARIO and BANCO
FILIPINO SAVINGS AND MORTGAGE BANK
G.R. No. 140528 & 140553, 7 December 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Registration does not vest title; it is merely the evidence of such title. Land registration laws do
not give the holder any better title than what he actually has.
Under Article 2085 of the Civil Code, one of the essential requisites of the contract of mortgage
is that the mortgagor should be the absolute owner of the property to be mortgaged; otherwise, the
mortgage is considered null and void. However, an exception to this rule is the doctrine of mortgagee in
good faith.
Valeriano Semilla (Valeriano) gave Lot No. 356-A to his sister Marta Semilla, married to
Eugenio Torbela (spouses Torbela). Upon the deaths of the spouses Torbela, Lot No. 356-A was
adjudicated in equal shares among their children (Torbela siblings). The Torbela siblings executed a
Deed of Absolute Quitclaim in favor of Dr. Rosario. Another Deed of Absolute Quitclaim was
subsequently executed, this time by Dr. Rosario, acknowledging that he only borrowed Lot No. 356-
A from the Torbela siblings and was already returning the same to the latter for P1.00. Dr. Rosario
and his wife, Lena Duque-Rosario (Duque-Rosario), acquired a loan from Banco Filipino Savings and
Mortgage Bank (Banco Filipino). To secure said loan, the spouses Rosario again constituted
mortgages which also covers Lot No. 356-A among others. The Torbela siblings filed before the
Regional Trial Court (RTC) a Complaint for recovery of ownership and possession of Lot No. 356-A,
plus damages, against the spouses Rosario. The spouses Rosario afterwards failed to pay their loan
from Banco Filipino. Banco Filipino extrajudicially foreclosed the mortgages. During the public
auction, Banco Filipino was the lone bidder for the foreclosed properties for the price. The Torbela
siblings filed before the RTC their Amended Complaint, impleading Banco Filipino as additional
defendant and praying that the spouses Rosario be ordered to redeem Lot No. 356-A from Banco
Filipino. The Torbela siblings tried to redeem Lot No. 356-A from Banco Filipino, but their efforts
were unsuccessful. Upon the expiration of the one-year redemption period, the Certificate of Final
Sale and Affidavit of Consolidation covering the foreclosed properties were executed. The Torbela
siblings thereafter filed before the RTC a Complaint for annulment of the Certificate of Final Sale,
judicial cancellation of TCT No. 165813, and damages, against Banco Filipino, the Ex Officio Provincial
Sheriff, and the Register of Deeds of Pangasinan. Banco Filipino filed before the RTC a Petition for the
issuance of a writ of possession. The RTC rendered judgment in favor of Banco Filipino while it
ordered to give the Torbela siblings the right of first refusal over Lot 356-A. The Torbela siblings and
Dr. Rosario appealed the foregoing RTC judgment before the Court of Appeals. In its Decision, the
Court of Appeals affirmed the RTC’s ruling. The Court of Appeals denied the separate Motions for
Reconsideration of the Torbela siblings and Dr. Rosario. The Torbela siblings come before this Court
via the Petition for Review.
ISSUES:
1. Whether the issuance of TCT No. 52751 to Dr. Rosario bars Torbela siblings’ claim and
conclusively transfers ownership to the former.
2. Whether the Torbela siblings may still recover Lot No. 356-A considering that Dr. Rosario had
already mortgaged Lot No. 356-A to Banco Filipino.
RULING:
1. NO. Registration does not vest title; it is merely the evidence of such title. Land registration
laws do not give the holder any better title than what he actually has. Consequently, Dr. Rosario must
still prove herein his acquisition of title to Lot No. 356-A, apart from his submission of TCT No. 52751
in his name.
The Court though observes that Dr. Rosarios testimony on the execution and existence of the
verbal agreement with the Torbela siblings lacks significant details (such as the names of the parties
present, dates, places, etc.) and is not corroborated by independent evidence. In addition, Dr. Rosario
acknowledged the execution of the two Deeds of Absolute Quitclaim dated December 12,
1964 and December 28, 1964, even affirming his own signature on the latter Deed. It can also be said
that Dr. Rosario is estopped from claiming or asserting ownership over Lot No. 356-A based on his
Deed of Absolute Quitclaim dated December 28, 1964. Dr. Rosario's admission in the said Deed that
he merely borrowed Lot No. 356-A is deemed conclusive upon him. Under Article 1431 of the Civil
Code, [t]hrough estoppel an admission or representation is rendered conclusive upon the person
making it, and cannot be denied or disproved as against the person relying thereon. That admission
cannot now be denied by Dr. Rosario as against the Torbela siblings, the latter having relied upon his
representation.
Considering the foregoing, the Court agrees with the RTC and the Court of Appeals that Dr.
Rosario only holds Lot No. 356-A in trust for the Torbela siblings.
2. YES. Under Article 2085 of the Civil Code, one of the essential requisites of the contract of
mortgage is that the mortgagor should be the absolute owner of the property to be mortgaged;
otherwise, the mortgage is considered null and void. However, an exception to this rule is the
doctrine of mortgagee in good faith. Under this doctrine, even if the mortgagor is not the owner of
the mortgaged property, the mortgage contract and any foreclosure sale arising therefrom are given
effect by reason of public policy.
The Court finds that Banco Filipino is not a mortgagee in good faith. Entry Nos. 274471-
274472 were not validly cancelled, and the improper cancellation should have been apparent to
Banco Filipino and aroused suspicion in said bank of some defect in Dr. Rosarios title.
It is a well-settled rule that a purchaser or mortgagee cannot close his eyes to facts which
should put a reasonable man upon his guard, and then claim that he acted in good faith under the
belief that there was no defect in the title of the vendor or mortgagor.
While the defective cancellation of Entry Nos. 274471-274472 by Entry No. 520469 might
not be evident to a private individual, the same should have been apparent to Banco Filipino. Banco
Filipino is not an ordinary mortgagee, but is a mortgagee-bank, whose business is impressed with
public interest.
Innocent Purchaser for Value
AURORA L. TECSON, et al. v. MINERVA, MARIA, et al. ALL SURNAMED FAUSTO AND ISABEL
VDA. DE FAUSTO
G.R. No. 180683, 01 June 2011, FIRST DIVISION (Perez, J.)
An innocent purchaser for value is one who buys the property of another without notice that
some other person has a right to or interest therein and who then pays a full and fair price for it at the
time of the purchase or before receiving a notice of the claim or interest of some other persons in the
property.
Sometime in 1945, Atty. Agustin Fausto (Atty. Fausto) acquired in co-ownership with his
sister, Waldetrudes Fausto-Nadela (Waldetrudes), Lot 2189—a one thousand fifteen (1,015) square
meter parcel of land situated at Jose Zulueta Street corner National Highway in Pagadian City,
Zamboanga Del Sur. In 1953, Atty. Fausto constructed his house on a portion of the said lot.
In 1970, following a cadastral proceeding, Atty. Fausto and Waldetrudes were recognized as
co-owners of Lot 2189. Not long after, Atty. Fausto and Waldetrudes decided to partition Lot 2189.
On 25 March 1974, Engr. Aguilar prepared subdivision plan Psd-09-06-000110 (First Plan) that
divided Lot 2189 into two (2) lots, i.e., Lot 2189-A with an area of 507 square meters, and Lot 2189-
B with an area of 508 square meters.
On 6 April 1974, the Regional Director of the Bureau of Lands approved the First Plan. On 15
April 1974, Atty. Fausto and Waldetrudes formalized their decision to subdivide Lot 2189 by
executing an Agreement of Partition. Under this agreement (First Partition Agreement), Waldetrudes
was to be given absolute ownership over Lot 2189-A, while Atty. Fausto was to be conferred separate
dominion over Lot 2189-B. The First Partition Agreement, however, was never registered with the
Register of Deeds. On 14 March 1975, Atty. Fausto died. He was survived by herein respondents, who
are his wife and children. On 7 July 1977, however, Waldetrudes entered into a Contract to Sell with
herein petitioner Aurora L. Tecson (Aurora). In it, Waldetrudes undertook to sell, among others, her
"ideal share" in Lot 2189 to Aurora upon full payment of the purchase price. On 28 July 1977, Engr.
Aguilar prepared a second subdivision plan (Second Plan) for Lot 2189. The Second Plan, designated
as Psd-268803, drastically altered the division of Lot 2189 under the First Plan.
The Second Plan was approved by the Land Registration Commission on 12 August 1977. On
28 September 1977, a second partition over Lot 2189 (Second Partition Agreement) was executed
between the respondents in their capacity as heirs of Atty. Fausto on one hand, and Waldetrudes on
the other. Presumably with the Second Plan as a new basis, the agreement named Waldetrudes as the
owner of Lot 2189-B while the respondents were allocated Lot 2189-A. On 8 May 1978, Waldetrudes
sold Lot 2189-B, with an area of nine hundred sixty-four (964) square meters, to Aurora.
Seven (7) years after, or on 28 May 1987, the respondents filed a Complaint for the
Declaration of Nullity of Documents, Titles, Reconveyance and Damages against Waldetrudes and the
petitioners before the Regional Trial Court (RTC) of Pagadian City. In essence, the respondents seek
the recovery of four hundred fifty-seven (457) square meters of land from TCT No. T-4,342, which
they believe was unlawfully taken from the lawful share of their predecessor-in-interest, Atty. Fausto,
in Lot 2189.
The respondents allege that Atty. Fausto and Waldetrudes are, in actual fact, co-owners in
equal share of Lot 2189. They insist on the First Partition Agreement as the only true, correct and
binding division of Lot 2189. Hence, Atty. Fausto is entitled not merely to the meager fifty-one (51)
square meter lot actually given to him under the Second Plan and Second Partition Agreement, but
to the five hundred eight (508) square meters of land allotted for him under the original partition.
ISSUE:
Whether Atty. Tecson is an innocent purchaser for value.
RULING:
NO. The Court finds that Atty. Tecson is not an innocent purchaser for value. The proven facts
indicate that Atty. Tecson knew or, at the very least, should have known that Atty. Fausto and
Waldetrudes were co-owners in equal share of Lot 2189.
Tecson was a long-time friend and neighbor of the Faustos. Atty. Tecson himself testified that
he considered Atty. Fausto as a good friend and even admitted that he would sometimes visit the
latter in his house to play mahjong. By this, Atty. Tecson knew that Atty. Fausto has an actual interest
in Lot 2189. Also, Atty. Tecson was the one who presented the Second Partition Agreement to
Waldetrudes and the respondents.
Moreover, Waldetrudes and the respondents were not involved in the preparation of the
Second Partition Agreement and, at the time they signed the said agreement, had no knowledge of
the existence of the Second Plan. The Second Partition Agreement failed to state the specific areas
allotted for each component of Lot 2189 and made no mention of the division proposed by the Second
Plan. Being the one behind the execution of the Second Partition Agreement, there is no doubt that
Atty. Tecson knew that Lot 2189 was owned in common by Waldetrudes and Atty. Fausto. This, taken
together with the instrument’s unusual silence as to the definite area allotted for each component lot
and the Second Plan, reveals a deliberate attempt on the part of Atty. Tecson to conceal from
Waldetrudes and the respondents the unequal division of Lot 2189.
The necessity to conceal the disproportionate division of Lot 2189 can only be explained by
Atty. Tecson’s prior knowledge that such a partition is inherently defective for being contrary to the
actual sharing between Waldetrudes and Atty. Fausto. Atty. Tecson is clearly in bad faith.
THE HEIRS OF NICOLAS S. CABIGAS v. MELBA L. LIMBACO, et al.

A purchaser in good faith is one who buys the property of another without notice that some
other person has a right to or interest in such property, and pays a full and fair price for the same at the
time of such purchase or before he has notice of the claim of another person.
Lolita Cabigas and her late husband, Nicolas Cabigas (Cabigas) purchased two lots from
Salvador Cobarde (Cobarde), who in turn had purchased the lots from Ines Ouano (Ouano).
Notwithstanding the sale between Ouano and Cobarde, and because the two lots remained registered
in her name, Ouano was able to sell the same lots to the National Airports Corporation for its airport
expansion project. The National Airports Corporation promptly had the titles of the properties
registered in its name. When the airport expansion project fell through, Melba Limbaco, et al.
succeeded in reclaiming title to the two lots through an action for reconveyance filed with the lower
court. The titles over the lots were thereafter registered in their names. The lots were then
subdivided and were sold to the other respondents in this case. Thus, the heirs of Cabigas filed a
complaint for the annulment of titles of the lands registered in the names of Limbaco, et al.
The Regional Trial Court (RTC) granted the motion for summary judgment and dismissed the
complaint. According to the RTC, while the heirs of Cabigas alleged bad faith and malice on the part
of Ouano when she sold the same properties to the National Airports Corporation, they never alleged
bad faith on the part of the buyer, the National Airports Corporation. Since good faith is always
presumed, the RTC concluded that the National Airports Corporation was a buyer in good faith and
its registration of the properties in its name effectively transferred ownership over the two lots, free
from all the unrecorded prior transactions involving these properties, including the prior sale of the
lots to Cobarde. The Court of Appeals (CA) dismissed the appeal based on technicalities.
ISSUES:
1. Whether or not Spouses Cabigas are buyers in good faith.

2. Whether or not the National Airports Corporation registered the sale in bad faith.
RULING:
1. NO. A purchaser in good faith is one who buys the property of another without notice that
some other person has a right to or interest in such property, and pays a full and fair price for the
same at the time of such purchase or before he has notice of the claim of another person. It is a well-
settled rule that a purchaser cannot close his eyes to facts which should put a reasonable man upon
his guard, and then claim that he acted in good faith under the belief that there was no defect in the
title of the vendor. His mere refusal to believe that such defect exists, or his willful closing of his eyes
to the possibility of the existence of a defect in his vendors title, will not make him an innocent
purchaser for value, if it afterwards develops that the title was in fact defective, and it appears that
he had such notice of the defect as would have led to its discovery had he acted with that measure of
precaution which may reasonably be required of a prudent man in a like situation.
The case deals with registered land, a fact known to the Cabigas spouses since they received
the duplicate owner’s certificate of title from Cobarde when they purchased the land. At the time of
the sale to the Cabigas spouses, however, the land was registered not in Cobarde’s name, but in
Ouano’s name. The Cabigas spouses relied completely on Cobarde’s representation that he owned
the properties in question, and did not even bother to perform the most perfunctory of investigations
by checking the properties’ titles with the Registry of Deeds. Had the Cabigas spouses only done so,
they would easily have learned that Cobarde had no legal right to the properties they were acquiring
since the lots had already been registered in the name of the National Airports Corporation in 1952.
Their failure to exercise the plain common sense expected of real estate buyers bound them to the
consequences of their own inaction.
2. NO. Based on Article 1544 of the Civil Code, the overriding consideration to determine
ownership of an immovable property is the good or bad faith not of the seller, but of the buyer;
specifically, the Court is tasked to determine who first registered the sale with the Registry of
Property (Registry of Deeds) in good faith. Since the heirs of Cabigas never alleged that the National
Airports Corporation acted with bad faith when it registered the lots in its name, the presumption of
good faith prevails. Consequently, the National Airports Corporation, being a registrant in good faith,
is recognized as the rightful owner of the lots in question, and the registration of the properties in its
name cut off any and all prior liens, interests and encumbrances, including the alleged prior sale to
Cobarde, that were not recorded on the titles. Cobarde, thus, had no legal rights over the property
that he could have transferred to the Cabigas spouses.
Since the Cabigas spouses have no legally recognizable interest in the lots in question, it
follows that the petitioners, who are subrogated to the rights of the former by virtue of succession,
also have no legally recognizable rights to the properties that could be enforced by law. The
petitioners clearly have no cause of action against the respondents, and the RTC correctly dismissed
their complaint for annulment of title.
PHILIPPINE NATIONAL BANK v. CIRIACO JUMAMOY and HEIRS OF ANTONIO GO PACE,

represented by ROSALIA PACE
A banking institution is expected to exercise due diligence before entering into a mortgage
contract. The ascertainment of the status or condition of a property offered to it as security for a loan must be
a standard and indispensable part of its operations.
The RTC, Branch 19, of Digos City, Davao del Sur, rendered a Decision in Civil Case No. 2514
ordering the exclusion of 2.5002 hectares from Lot 13521. The trial court found that said 2.5002
hectares covered by Original Certificate of Title (OCT) No. P-4952 registered in the name of Antonio
Go Pace (Antonio) actually pertains to Ciriaco and Sesinando Jumamoy (Sesinando), Ciriaco
Jumamoy’s predecessor-in-interest. The RTC found that said lot was erroneously included in
Antonio’s free patent application which became the basis for the issuance of his OCT. It then ordered
the heirs of Antonio to reconvey said portion to Ciriaco, acknowledging Ciriaco’s actual and exclusive
possession, cultivation, and claim of ownership over the subject lot which he acquired from his father
Sesinando, who occupied and improved the lot way back in the early 1950s.
The RTC Decision became final and executory but the Deed of Conveyance issued in favor of
Ciriaco could not be annotated since said title was already cancelled. Apparently, Antonio and his
wife Rosalia mortgaged Lot 13521 to PNB as security for a series of loans. After Antonio and Rosalia
failed to pay their obligation, PNB foreclosed the mortgage and title to Lot 13521 was transferred to
PNB. Moreover, the Deed of Conveyance could not be annotated because PNB was not impleaded as
a defendant in the earlier case.
Thus, Ciriaco filed a complaint against PNB and the Paces for Declaration of Nullity of
Mortgage, Foreclosure Sale, Reconveyance and Damages. Ciriaco averred that Antonio could not
validly mortgage the entire lot to PNB as a portion thereof belongs to him (Ciriaco). He claimed that
PNB is not an innocent mortgagee/purchaser for value because prior to the execution and
registration of PNBs deed of sale with the Register of Deeds, the bank had prior notice that the
disputed lot is subject of a litigation.
ISSUE:
Whether the bank is a mortgagee/purchaser in good faith.
RULING:
NO. Undoubtedly, our land registration statute extends its protection to an innocent
purchaser for value, defined as one who buys the property of another, without notice that some other
person has a right or interest in such property and pays the full price for the same, at the time of such
purchase or before he has notice of the claims or interest of some other person in the property. An
innocent purchaser for value includes an innocent lessee, mortgagee, or other encumbrancer for
value .
Here, PNB is not an innocent purchaser for value. PNBs contention that Ciriaco failed to allege
in his complaint that PNB failed to take the necessary precautions before accepting the mortgage is
of no moment. It is undisputed that the 2.5002-hectare portion of the mortgaged property has been
adjudged in favor of Ciriaco’s predecessor-in-interest in Civil Case No. 2514. Hence, PNB has the
burden of evidence that it acted in good faith from the time the land was offered as
collateral. However, PNB miserably failed to overcome this burden. There was no showing at all that
it conducted an investigation; that it observed due diligence and prudence by checking for flaws in
the title; that it verified the identity of the true owner and possessor of the land; and, that it visited
subject premises to determine its actual condition before accepting the same as collateral.
Direct and Collateral Attack on Land Titles
ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA v. EDUARDO SORIANO, JR.,

et al. / BENJAMIN GUINTO, JR., v. ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO,
PAMPANGA
G.R. Nos. 153829/160909, 17 August 2011, FIRST DIVISION (Villarama, Jr., J.)
An action is deemed an attack on a title when its objective is to nullify the title, thereby
challenging the judgment pursuant to which the title was decreed. The attack is direct when the
objective is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack
is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment is
nevertheless made as an incident thereof.
The Roman Catholic Archbishop (RCA) of San Fernando, Pampanga, represented by Most Rev.
Paciano B. Aniceto, D.D., claimed that it is the owner of a vast tract of land located near the Catholic
Church at Poblacion, Macabebe, Pampanga and covered by Original Certificate of Title (OCT) No.
17629 issued by the Registry of Deeds of San Fernando on February 21, 1929. The RCA alleged that
several individuals unlawfully occupied the subject land and refused to vacate despite repeated
demands. Having no other recourse, the RCA filed an ejectment case before the MCTC of Macabebe-
Masantol, Pampanga against the alleged intruders. On the other hand, defendants Eduardo Soriano,
et al. (Soriano, et al.) countered that the RCA has no cause of action against them because its title is
spurious. They contended that the subject land belonged to the State, but they have already acquired
the same by acquisitive prescription as they and their predecessors-in-interest have been in
continuous possession of the land for more than thirty (30) years.
The MCTC rendered decision in favor of the RCA and held that the OCT No. 17629 in the name
of the RCA remains valid and binding against the whole world until it is declared void by a court of
competent jurisdiction. The appeal before the RTC was dismissed because of failure of defendants to
file the appeal memorandum. When defendants elevated the case to the CA, their petition for
certiorari was not given due course for failure to file the same within the extended period. Hence, the
decision ejecting the defendants from the premises became final. Thus, the RCA filed an Urgent
Motion for Immediate Issuance of a Writ of Execution, which the MCTC granted. Seeking to enjoin the
implementation of the writ of execution and the notice to vacate, Benjamin Guinto (Guinto) filed the
instant Petition for Injunction with Prayer for Issuance of a Temporary Restraining Order (TRO).
Meanwhile, during the pendency of the ejectment case at the MCTC, some of the defendants,
Soriano, et al., filed a Civil Case against the RCA for Quieting of Title and Declaration of Nullity of Title
before the RTC of Macabebe, Pampanga.
ISSUE:
Whether the civil action for Quieting of Title and Declaration of Nullity of Title filed by
defendants Soriano, et al. constitutes a collateral attack on RCA’s title.
RULING:
NO. The complaint against the RCA does not amount to a collateral attack because the action
for the declaration of nullity of OCT No. 17629 is a clear and direct attack on its title.
An action is deemed an attack on a title when its objective is to nullify the title, thereby
challenging the judgment pursuant to which the title was decreed. The attack is direct when the
objective is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the
attack is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment
is nevertheless made as an incident thereof. The complaint filed with the RTC pertinently alleged that
the claim of ownership by the RCA is spurious as its title, denominated as OCT No. 17629, is fake for
the following reasons: (1) that the erasures are very apparent and the title itself is fake; (2) it was
made to appear under Memorandum of Encumbrance Entry No. 1007 that the title is a reconstituted
title when in truth, it is not; and (3) the verification reveals that there was no petition filed before any
court where an order was issued for the reconstitution and re-issuance of an owners duplicate
copy. It is thus clear from the foregoing that the case filed questioning the genuineness of OCT No.
17629 is a direct attack on the title of the RCA.
Original Registration
REPUBLIC OF THE PHILIPPINES v. CARLOS VEGA

G.R. No. 177790, 17 January 2011, THIRD DIVISION (Sereno, J.)
If there has been substantial compliance even if there is an absence of the certification from the
CENRO or the DENR in proving that there has been a positive government act that classifies such land
as alienable and disposable, then the said application for registration may be granted.
Carlos Vega applied before the Land Registration Authority (LRA) and subsequently the
Regional Trial Court (RTC) an application for the original certificate of title over the land he currently
possess and owns along with his other siblings which has inherited the said property from their
parents.
He presented as evidence the testimony of Mr. Rodolfo Gonzales of the Community

Environment and Natural Resources Office (CENRO) which attested that the disputed property is
part of the alienable and disposable zone that can be appropriated by the State.
The OSG on the other hand posits that Carlos Vega has not met the burden of proving that
such land is alienable and disposable, and hence such property must not be sold by the State.
The RTC and the Court of Appeals (CA) granted the application of title of Carlos Vega to which
the OSG protests.
ISSUE:
Whether or not the application of registration of title of Carlos Vega should be granted.
RULING:
YES. This case is a pro hac vice and the ruling of the Court in the case does not in any way
divert from jurisprudence. The Court has noted that in various jurisprudence there has been variance
with what type of evidence would conclusively state that such property is indeed alienable and
disposable. In this case, the Court has noted that substantial compliance will do, meaning that if it can
be proven that there is a positive governmental act that the State classified such property as alienable
and disposable, the registration of title must be granted.
To establish that the land subject of the application is alienable and disposable public land,
the general rule remains: all applications for original registration under the Property Registration
Decree must include both (1) a CENRO or PENRO certification and (2) a certified true copy of the
original classification made by the DENR Secretary.
VICENTE YU CHANG AND SOLEDAD YU CHANG v. REPUBLIC OF THE PHILIPPINES

G.R. No. 171726, 23 February 2011, THIRD DIVISION (Villarama, Jr., J.)
Possession of forest land, prior to its classification as alienable and disposable land, is ineffective
since such possession may not be considered as possession in the concept of owner.
Soledad Yu Chang and her brother and co-owner, Vicente Yu Chang (Soledad and Vicente),
filed a petition for registration of title over their lots under the Property Registration Decree. Soledad
and Vicente acquired the subject property when their siblings transferred the same to them. The
subject land was originally owned by the Municipality of Pili, Camarines Sur, but was acquired by L.
Yu Chang, Soledad and Vicente’s father, through barter. The Republic of the Philippines (Republic)
opposed the said petition.
The Regional Trial Court (RTC) granted the application. On appeal, the Republic contended
that the subject land was considered a forest land and thus, cannot be alienated. The Court of Appeals
(CA) reversed the RTC and dismissed the application for land registration. The CA considered the
petition to be governed by Section 48(b) of Commonwealth Act (C.A.) No. 141 or the Public Land Act,
as amended, and held that Soledad and Vicente were not able to present incontrovertible evidence
that the subject land sought to be registered are alienable and disposable.
Soledad and Vicente claim that the subject properties could no longer be considered and
classified as forest land since there are buildings, residential houses and even government structures
existing and standing on the land. From 1949, when L. Yu Chang acquired the property through barter
and up to the filing of their application in 1997, Soledad and Vicente and their predecessors-in-
interest had been in actual physical and material possession of the land in the concept of an owner.
The Republic, for its part, maintains that Soledad and Vicente failed to prove their open, continuous,
exclusive and notorious possession of the subject lots for the period of time required by law since the
subject lands were declared as alienable and disposable only on October 30, 1986.
ISSUE:
Whether or not the application for land registration should be dismissed for failure to comply
with the requirements of Section 48(b) of the Public Land Act, as amended.
RULING:
YES. Under Section 48(b) of the Public Land Act, as amended by P.D. 1073, in order that
petitioner’s application for registration of title may be granted, they must first establish the
following: (1) that the subject land forms part of the disposable and alienable lands of the public
domain and (2) that they have been in open, continuous, exclusive and notorious possession and
occupation of the same under a bona fide claim of ownership, since June 12, 1945, or earlier.
In the instant case, Soledad and Vicente did not adduce any evidence to the effect that the lots
subject of their application are alienable and disposable land of the public domain. Instead, Soledad
and Vicente contended that the subject properties could no longer be considered and classified as
forest land since there are building structures, residential houses and even government buildings
existing and standing on the area. This, however, is hardly the proof required under the law. As
clarified by the Court in Heirs of Jose Amunategui v. Director of Forestry, a forested area classified as
forest land of the public domain does not lose such classification simply because loggers or settlers
may have stripped it of its forest cover. Parcels of land classified as forest land may actually be
covered with grass or planted with crops by kaingin cultivators or other farmers. Forest lands do not
have to be on mountains or in out-of-the-way places. The classification of land is descriptive of its
legal nature or status and does not have to be descriptive of what the land actually looks like. Unless
and until the land classified as forest land is released in an official proclamation to that effect so that
it may form part of the disposable agricultural lands of the public domain, the rules on confirmation
of imperfect title do not apply.
Moreover, during the hearing of Soledad and Vicente’s application, the Republic presented a
Report of Rene Gomez, Land Investigator/Inspector, CENRO No. V-2-3, which disclosed that the lots
applied for by Soledad and Vicente were classified as alienable and disposable under Project No. 9-E,
L.C. Map No. 3393 and released and certified as such only on October 30, 1986. Therefore, the subject
lots were declared alienable and disposable only on October 30, 1986. Prior to that period, the same
could not be the subject of confirmation of imperfect title. Soledad and Vicente’s possession of the
subject forest land prior to the date when it was classified as alienable and disposable is
inconsequential and should be excluded from the computation of the period of possession. To
reiterate, it is well settled that possession of forest land, prior to its classification as alienable and
disposable land, is ineffective since such possession may not be considered as possession in the
concept of owner. The adverse possession which can be the basis of a grant of title in confirmation of
imperfect title cases cannot commence until after forest land has been declared and alienable. Since
Soledad and Vicente failed to present well-nigh incontrovertible evidence necessary to prove their
compliance of the requirements under Section 48(b) of C.A. No. 141, the CA did not err in dismissing
their application for confirmation and registration of title.
REPUBLIC OF THE PHILIPPINES v. TEODORO P. RIZALVO, JR.

G.R. No. 172011, 07 March 2011, THIRD DIVISION (VILLARAMA, J.)
Existing law and jurisprudence provides that an applicant for judicial confirmation of imperfect
title must prove compliance with Section 14 of Presidential Decree (P.D.) No. 1529 or the Property
Registration Decree.
On December 7, 2000, Teodoro P. Rizalvo, Jr. (Teodoro) filed before the Municipal Trial Court
(MTC) of Bauang, La Union, acting as a land registration court, an application for the registration of a
parcel of land in Bauang, La Union. Teodoro alleged that he is the owner in fee simple of the subject
parcel of land; that he obtained title over the land by purchase from his mother Bibiana P. Rizalvo
(Bibiana), as evidenced by a deed of transfer dated December 31, 1962; that he is in possession of the
land; and that he has been paying real property taxes since 1952. Bibiana testified that she purchased
the lot from one Eufrecina Navarro on July 8, 1952.
The Republic, through the Office of the Solicitor General (OSG), filed an opposition alleging
that neither Teodoro nor his predecessors-in-interest had been in open, continuous, exclusive and
notorious possession and occupation of the subject property since June 12, 1945 or earlier and that
the tax declarations and tax payment receipts did not constitute competent and sufficient evidence
of ownership. The OSG also asserted that the subject property was a portion of public domain
belonging to the Republic; hence, not subject to private acquisition.
The MTC approved Teodoro’s application. On appeal, the Court of Appeals (CA) affirmed the
MTC’s decision. Hence, this petition.
ISSUE:
Whether or not Teodoro and his predecessors-in-interest were in open, continuous, adverse,
and public possession of the land in question in the manner and length of time required by law.
RULING:
NO. Existing law and jurisprudence provides that an applicant for judicial confirmation of
imperfect title must prove compliance with Section 14 of Presidential Decree (P.D.) No. 1529 or the
Property Registration Decree.
Under Section 14 (1), applicants for registration of title must sufficiently establish first, that
the subject land forms part of the disposable and alienable lands of the public domain; second, that
the applicant and his predecessors-in-interest have been in open, continuous, exclusive and
notorious possession and occupation of the same; and third, that it is under a bona fide claim of
ownership since June 12, 1945, or earlier.
The first requirement was satisfied in this case. The certification and report dated July 17,
2001 submitted by Special Investigator I Dionisio L. Picar of the Community Environment and
Natural Resources Office CENRO of San Fernando City, La Union, states that the entire land area in
question is within the alienable and disposable zone, certified as such since January 21, 1987.
Teodoro likewise met the second requirement as to ownership and possession. The MTC and
the CA both agreed that Teodoro has presented sufficient testimonial and documentary evidence to
show that he and his predecessors-in-interest were in open, continuous, exclusive and notorious
possession and occupation of the land in question. Said findings are binding upon the Court absent
any showing that the lower courts committed glaring mistakes or that the assailed judgment is based
on a misapprehension of facts.
However, the third requirement, that Teodoro and his predecessors-in-interest be in open,
continuous, exclusive and notorious possession and occupation of the subject property since June 12,
1945 or earlier, has not been satisfied. Teodoro only managed to present oral and documentary
evidence of his and his mother’s ownership and possession of the land since 1958 through a
photocopy of the deed of absolute sale dated July 8, 1958 between Eufrecina Navarro and Bibiana P.
Rizalvo.
But given the fact that Teodoro and his predecessors-in-interest had been in possession of
the subject land since 1948, is Teodoro nonetheless entitled to registration of title under Section 14
(2) of P.D. No. 1529? To this question, the Court likewise answered in the negative.
Teodoro would have been eligible for application for registration because his claim of
ownership and possession over the subject property even exceeds thirty (30) years. However, it is
jurisprudentially clear that the thirty (30)-year period of prescription for purposes of acquiring
ownership and registration of public land under Section 14 (2) of P.D. No. 1529 only begins from the
moment the State expressly declares that the public dominion property is no longer intended for
public service or the development of the national wealth or that the property has been converted into
patrimonial.
There is no evidence in this case indicating any express declaration by the State that the
subject land is no longer intended for public service or the development of the national wealth. Thus,
there appears no basis for the application of the thirty-year prescriptive period in this case.
UNION LEAF TOBACCO CORPORATION v. REPUBLIC OF THE PHILIPPINES

G.R. No. 185683, 16 March 2011, THIRD DIVISION (CARPIO-MORALES, J.)
The applicant for registration must present a copy of the original classification approved by the
Department of Environment and Natural Resources (DENR) Secretary and certified as a true copy by
the legal custodian of the official records—mere notation by a geodetic engineer on the survey plan that
property is alienable and disposable does not suffice to prove the land classification.
Union Leaf Tobacco Corporation (Union Leaf) filed four applications for land registration
covering several parcels of land before the Regional Trial Court of Agoo, La Union. Union Leaf alleged
that it is the absolute owner of those parcels of land, having bought them from various individuals;
and that its predecessors-in-interest have been in open, continuous, exclusive and notorious
possession and occupation of the properties for more than thirty (30) years. The Republic opposed
the applications, citing Article XII, Section 3 of the Constitution.
The trial court dismissed the applications of Union Leaf without prejudice for its failure to
prove its allegation that it had been in “open, continuous, exclusive and notorious possession and
occupation” of the lots. Later, the trial court reopened the applications upon Union Leaf’s motion. The
trial court then confirmed Union Leaf’s titles over the properties subject of its applications. On appeal
by the Republic, the Court of Appeals reversed the trial court’s decision. Union Leaf then filed a
petition for review before the Supreme Court, which was denied.
Hence, this motion for reconsideration. Union Leaf argues that its documentary evidence
shows that the government declared and confirmed that the subject properties are alienable and
disposable, pursuant to the Advance Plans and Consolidated Plans which all noted that the subject
lands are “inside alienable and disposable area as per project No. 5A, LC Map No. 2891.”
ISSUE:
Whether or not Union Leaf’s application for registration must be granted.
RULING:
NO. The Advance Plans and Consolidated Plans are hardly the competent pieces of evidence
that the law requires. The notation by a geodetic engineer on the survey plans that properties are
alienable and disposable does not suffice to prove these lands’ classification.
Republic v. T.A.N. Properties, Inc. directs that the applicant for registration must present a copy
of the original classification approved by the Department of Environment and Natural Resources
Secretary and certified as a true copy by the legal custodian of the official records.
The Republic failed to comply with this directive. This leaves it unnecessary to delve into the
testimonies of Union Leaf’s predecessors-in-interest respecting their alleged possession of the
subject properties.
NATIVIDAD STA. ANA VICTORIA v. REPUBLIC OF THE PHILIPPINES

To prove that the land subject of the application for registration is alienable, an applicant must
establish the existence of a positive act of the government such as a presidential proclamation or an
executive order; an administrative action; investigation reports of Bureau of Lands investigators; and a
legislative act or statute.
Natividad Sta. Ana Victoria applied for registration of a 1,729-square meter lot in Bambang,
City of Taguig, before the Metropolitan Trial Court (MeTC) of that city. The Office of the Solicitor
General (OSG) opposed the application in the usual form.
Victoria testified and offered documentary evidence to show that the subject lot is a portion
of a parcel of land originally owned by Victoria’s father, Genaro Sta. Ana, and previously declared in
his name for tax purposes. Upon Genaro’s death, Victoria and her siblings inherited the land and
divided it among themselves via a deed of partition.
The Conversion/Subdivision Plan Victoria presented in evidence showed that the land is
alienable and disposable area as certified by the Bureau of Forest Development. Victoria testified that
she and her predecessors-in-interest have been in possession of the property continuously,
uninterruptedly, openly, publicly, adversely and in the concept of owners since the early 1940s or for
more than 30 years and have been declared as owners for taxation purposes for the last 30 years. The
OSG did not present any evidence in support of its opposition.
The Metropolitan Trial Court (MeTC) granted the application for registration. The Court of
Appeals (CA) reversed the decision on the ground that Victoria failed to prove that the subject lot is
alienable and disposable land of the public domain. She could not, said the CA, rely on the notation in
the Conversion/Subdivision Plan. The CA also did not take cognizance of the DENR Certification that
Victoria submitted together with her appellee’s brief since she did not offer it in evidence during the
hearing before the trial court.
ISSUE:
Whether or not Victoria amply proved that the subject lot is alienable and disposable land of
the public domain.
RULING:
YES. To prove that the land subject of the application for registration is alienable, an applicant
must establish the existence of a positive act of the government such as a presidential proclamation
or an executive order; an administrative action; investigation reports of Bureau of Lands
investigators; and a legislative act or statute. The applicant may secure a certification from the
government that the lands applied for are alienable and disposable, but the certification must show
that the DENR Secretary had approved the land classification and released the land of the pubic
domain as alienable and disposable, and that the land subject of the application for registration falls
within the approved area per verification through survey by the PENRO or CENRO. The applicant
must also present a copy of the original classification of the land into alienable and disposable, as
declared by the DENR Secretary or as proclaimed by the President.
Since the OSG does not contest the authenticity of the DENR Certification, it seems too hasty
for the CA to altogether disregard the same simply because it was not formally offered in evidence
before the court below. More so when even the OSG failed to present any evidence in support of its
opposition to the application for registration during trial at the MeTC. The attack on Victoria’s proof
to establish the nature of the subject property was made explicit only when the case was at the appeal
stage in the Republic’s appellants brief. Only then did Victoria find it necessary to present the DENR
Certification, since she had believed that the notation in the Conversion/Subdivision Plan of the
property was sufficient.
In Llanes v. Republic, this Court allowed consideration of a CENRO Certification though it was
only presented during appeal to the CA to avoid a patent unfairness. The rules of procedure being
mere tools designed to facilitate the attainment of justice, the Court is empowered to suspend their
application to a particular case when its rigid application tends to frustrate rather than promote the
ends of justice. Denying the application for registration now on the ground of failure to present proof
of the status of the land before the trial court and allowing Victoria to re-file her application would
merely unnecessarily duplicate the entire process, cause additional expense and add to the number
of cases that courts must resolve. It would be more prudent to recognize the DENR Certification and
resolve the matter now.
There is no reason to disturb the conclusion of the trial court that Victoria amply established
her right to have the subject property registered in her name, given that she has met all the requisites
for registration of title under the Property Registration Decree.
RAMON ARANDA v. REPUBLIC OF THE PHILIPPINES

G.R. No. 172331, 24 August, 2011, FIRST DIVISION (Villarama, Jr., J.)
A person who seeks the registration of title to a piece of land on the basis of possession by himself
and his predecessors-in-interest must prove his claim by clear and convincing evidence.
Subject of a petition for original registration before the RTC is a parcel of land situated in San
Andres, Malvar, Batangas. The petition was originally filed by ICTSI Warehousing, Inc. (ICTSI-WI)
represented by its Chairman, Enrique K. Razon, Jr. The Republic through the Office of the Solicitor
General (OSG) filed its opposition on grounds that the land applied for is part of the public domain
and the applicant has not acquired a registrable title thereto under the provisions of Commonwealth
Act No. 141 as amended by Republic Act No. 6940.
ICTSI-WI sought leave of court to amend the application. The trial court admitted the
Amended Application for Registration of Title, this time filed in the name of Ramon Aranda, herein
petitioner. Aranda prayed that should the Land Registration Act be not applicable to this case, he
invokes the liberal provisions of Section 48 of Commonwealth Act No. 141, as amended, having been
in continuous possession of the subject land in the concept of owner, publicly, openly and adversely
for more than thirty (30) years prior to the filing of the application.
The trial court rendered its Decision granting the application and ordering the issuance of a
decree of registration in favor of Aranda. The Republic appealed to the CA which reversed the trial
court and held that Aranda’s evidence does not satisfactorily establish the character and duration of
possession required by law, as Aranda failed to prove specific acts showing the nature of the
possession by his predecessors-in-interest. The CA also did not give evidentiary weight to the
documents Pagpapatunay ng Pagkakaloob ng Lupa and Pagpapatunay ng Bilihang Lampasan ng
Lupa, both prepared only in the year 2000 when the application for registration was filed, as factual
proof of ownership by the parties to the compromise agreement. Aranda’s motion for
reconsideration was likewise denied by the CA.
ISSUE:
Whether Aranda established his title to the property.
RULING:
NO. The Property Registration Decree (P.D. No. 1529) provides for original registration of land
in an ordinary registration proceeding. Under Section 14(1) thereof, a petition may be granted upon
compliance with the following requisites: (a) that the property in question is alienable and disposable
land of the public domain; (b) that the applicants by themselves or through their predecessors-in-
interest have been in open, continuous, exclusive and notorious possession and occupation; and (c) that
such possession is under a bona fide claim of ownership since June 12, 1945 or earlier.
To prove that the land subject of an application for registration is alienable, an applicant must
establish the existence of a positive act of the government such as a presidential proclamation or an
executive order; an administrative action; investigation reports of Bureau of Lands investigators; and
a legislative act or a statute. The applicant may also secure a certification from the Government that
the lands applied for are alienable and disposable. Petitioner has not explained the discrepancies in
the dates of classification mentioned in the government certifications he presented as
evidence. Consequently, the status of the land applied for as alienable and disposable was not clearly
established.
Petitioner’s evidence failed to show that he possessed the property in the manner and for the
duration required by law. Petitioner presented tax declarations and the deeds of confirmation of the
1946 sale from the original owner (Lucio Olan) to Anatalio Aranda and the 1965 donation made by
the latter in favor of petitioner. But as found by the CA, the history of the land shows that it was
declared for taxation purposes for the first time only in 1981. While, as a rule, tax declarations or
realty tax payments of property are not conclusive evidence of ownership, nevertheless they are
good indicia of possession in the concept of owner, for no one in his right mind would be paying taxes
for a property that is not in his actual or constructive possession they constitute at least proof that
the holder has a claim of title over the property. Petitioner likewise failed to prove the alleged
possession of his predecessors-in-interest. Mere casual cultivation of the land does not amount to
exclusive and notorious possession that would give rise to ownership. Specific acts of dominion must
be clearly shown by the applicant.
DCD CONSTRUCTION INC. v. REPUBLIC OF THE PHILIPPINES

G.R. No. 179978, 31 August 2011 FIRST DIVISION (Villarama, Jr., J.)
Applicants for confirmation of imperfect title must prove the following: (a) that the land forms
part of the disposable and alienable agricultural lands of the public domain and (b) that they have been
in open, continuous, exclusive and notorious possession and occupation of the same under a bona fide
claim of ownership either since time immemorial or since June 12, 1945.
DCD Construction Inc. (DCD) wanted to register a parcel of land it claims to have openly,
continuously, exclusively, and notoriously possessed for the last thirty (30) years in Taytay, Danao
City. He claims to have had possessed the land by virtue of the purchase made by his predecessors.
Based on DCD’s documentary and testimonial evidence, it appears that the approved
technical description is allegedly identical to that of another lot consisting of 3,781 square
meters. 712 square meters of said lot can be segregated as salvage zone pursuant to DENR
Administrative Order No. 97-05.
The Regional Trial Court (RTC) declared the lot to be registrable and granted the petition of
DCD while the Court of Appeals subsequently reversed the decision of the trial court when the
Republic appealed its case, ratiocinating the failure of DCD to present evidence that such land was
indeed alienable and disposable.
ISSUE:
Whether or not the land can be registered.
RULING:
NO. Applicants for confirmation of imperfect title must prove the following: (a) that the land
forms part of the disposable and alienable agricultural lands of the public domain and (b) that they
have been in open, continuous, exclusive and notorious possession and occupation of the same under
a bona fide claim of ownership either since time immemorial or since June 12, 1945.
In this case, DCD was not able to prove either of the requisites when the earliest tax
declaration fail to prove anything and that he was not able to present evidence that he has been in
open, continuous, exclusive, and notorious possession of the adverse land.
PACIFICO M. VALIAO v. REPUBLIC OF THE PHILIPPINES, et al.
The burden of proof in overcoming the presumption of State ownership of the lands of the public
domain is on the person applying for registration (or claiming ownership), who must prove that
the land subject of the application is alienable or disposable. To overcome this
presumption, incontrovertible evidence must be established that the land subject of the application (or
claim) is alienable or disposable.
Pacifico, Lodovico, Ricardo, Bienvenido, all surnamed Valiao, and Nemesio Grandea (Pacifico,
et al.) filed with the Regional Trial Court an application for registration of Lot No. 2372 . Macario
Zafra and Manuel Yusay filed their Motion to Dismiss the application on the ground that the land
applied for has not been declared alienable and disposable. The Republic of the Philippines
(Republic), through the Office of the Solicitor General (OSG), opposed the application for registration
on the ground that the parcel of land applied for is a portion of public domain belonging to the
Republic, which is not subject to private appropriation. The RTC denied the Motion to Dismiss. The
RTC likewise granted Pacifico, et al.’s application for registration of the subject property. Aggrieved
by the Decision, the Zafra, Yusay and the Republic, filed an appeal with the CA, which reversed the
trial court's findings. Pacifico, et al. claim that Lot No. 2372 is an alienable and disposable portion of
the public domain. The possession of their predecessors-in interest since 1916 until 1966 had been
open, continuous and uninterrupted; thus, converting the said land into a private land. The subject
lot had already become private in character in view of the length of time the applicants and their
predecessors-in-interest had possessed the subject lot, which entitles them to the confirmation of
their title.
ISSUE:
Whether Lot No. 2372 is alienable and disposable land of the public domain.
RULING:
NO. Section 14 (1) of Presidential Decree No. (PD) 1529, otherwise known as the Property
Registration Decree provides:
SEC. 14. Who may apply. - The following persons may file in the proper Court of First
Instance an application for registration of title to land, whether personally or through
their duly-authorized representatives:
(1) Those who by themselves or through their predecessors-in-interest have been in

open, continuous, exclusive and notorious possession and occupation of alienable and
disposable lands of the public domain under a bona fide claim of ownership since June
12, 1945, or earlier.
From the foregoing, petitioners need to prove that: (1) the land forms part of the alienable
and disposable land of the public domain; and (2) they, by themselves or through their predecessors-
in-interest, have been in open, continuous, exclusive, and notorious possession and occupation of the
subject land under a bona fide claim of ownership from June 12, 1945 or earlier. These the petitioners
must prove by no less than clear, positive and convincing evidence.
Under the Regalian doctrine, which is embodied in our Constitution, all lands of the public
domain belong to the State, which is the source of any asserted right to any ownership of land. All
lands not appearing to be clearly within private ownership are presumed to belong to the State.
Accordingly, public lands not shown to have been reclassified or released as alienable agricultural
land or alienated to a private person by the State remain part of the inalienable public domain. Unless
public land is shown to have been reclassified as alienable or disposable to a private person by the
State, it remains part of the inalienable public domain. Property of the public domain is beyond the
commerce of man and not susceptible of private appropriation and acquisitive prescription.
Occupation thereof in the concept of owner no matter how long cannot ripen into ownership and be
registered as a title. The burden of proof in overcoming the presumption of State ownership of the
lands of the public domain is on the person applying for registration (or claiming ownership), who
must prove that the land subject of the application is alienable or disposable. To overcome this
presumption, incontrovertible evidence must be established that the land subject of the application
(or claim) is alienable or disposable.
There must be a positive act declaring land of the public domain as alienable and disposable.
To prove that the land subject of an application for registration is alienable, the applicant must
establish the existence of a positive act of the government, such as a presidential proclamation or an
executive order; an administrative action; investigation reports of Bureau of Lands investigators; and
a legislative act or a statute. The applicant may also secure a certification from the government that
the land claimed to have been possessed for the required number of years is alienable and disposable.
No such evidence was offered by the petitioners to show that the land in question has been
classified as alienable and disposable land of the public domain. In the absence of incontrovertible
evidence to prove that the subject property is already classified as alienable and disposable, it must
still be considered as inalienable public domain. Verily, the rules on the confirmation of imperfect
title do not apply unless and until the land subject thereof is released in an official proclamation to
that effect so that it may form part of the disposable agricultural lands of the public domain.
Jurisdiction for Land Registration
CITY OF DUMAGUETE v. PHILIPPINE PORTS AUTHORITY

G.R. No. 168973, 24 August 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Presently, jurisdiction over an application for land registration remains with the RTC where the
land is situated, except when such jurisdiction is delegated by the Supreme Court to the Metropolitan
Trial Court, Municipal Trial Courts, and Municipal Circuit Trial Courts under certain circumstances.
The City of Dumaguete, through Mayor Felipe Antonio B. Remollo (Remollo), filed before the
RTC an Application for Original Registration of Title over a parcel of land with improvements, located
at Barangay Looc, City of Dumaguete (subject property), under the Property Registration Decree.
The Republic of the Philippines, represented by the Director of Lands, and respondent
Philippine Ports Authority (PPA) filed separate Oppositions to the application for registration of the
City of Dumaguete. Both the Republic and PPA averred that the City of Dumaguete may not register
the subject property in its name since it had never been in open, continuous, exclusive, and notorious
possession of the said property for at least 30 years immediately preceding the filing of the
application; and the subject property remains to be a portion of the public domain which belongs to
the Republic.
PPA filed a Motion to Dismiss, seeking the dismissal of the case on the ground that the RTC
lacked jurisdiction to hear and decide the case. PPA argued that Section 14(1) of Presidential Decree
No. 1529, otherwise known as the Property Registration Decree, refers only to alienable and
disposable lands of the public domain under a bona fide claim of ownership. The subject property is
not alienable and disposable, since it is a foreshore land, as explicitly testified to by petitioners own
witness, Engr. Dorado. A foreshore land is not registerable.
In its Opposition to Oppositors’ Motion to Dismiss, the City of Dumaguete claimed that the
subject property was a swamp reclaimed about 40 years ago, which it occupied openly, continuously,
exclusively, and notoriously under a bona fide claim of ownership. The technical description and
approved plan of the subject property showed that the said property was not bounded by any part of
the sea. Petitioner invoked Republic Act No. 1899, which authorizes chartered cities and
municipalities to undertake and carry out, at their own expense, the reclamation of foreshore lands
bordering them; and grants said chartered cities and municipalities ownership over the reclaimed
lands.
ISSUE:
Whether the RTC has jurisdiction over the case.
RULING
YES. Under Act No. 496, otherwise known as the Land Registration Act, as amended by Act
No. 2347, jurisdiction over all applications for registration of title to land was conferred upon the
Courts of First Instance (CFI) of the respective provinces in which the land sought to be registered
was situated. Jurisdiction over land registration cases, as in ordinary actions, is acquired upon the
filing in court of the application for registration, and is retained up to the end of the litigation. The
land registration laws were updated and codified by the Property Registration Decree, and under
Section 17 thereof, jurisdiction over an application for land registration was still vested on the CFI of
the province or city where the land was situated.
Batas Pambansa Blg. 129, otherwise known as The Judiciary Reorganization Act of 1980,
created the RTC in place of the CFI. Presently, jurisdiction over an application for land registration
remains with the RTC where the land is situated, except when such jurisdiction is delegated by the
Supreme Court to the Metropolitan Trial Court, Municipal Trial Courts, and Municipal Circuit Trial
Courts under certain circumstances.
It is not disputed that the Application for Original Registration of Title filed by petitioner
before the RTC of the City of Dumaguete conformed to Section 15 of the Property Registration Decree,
which prescribes the form and contents of such applications. In its Application, petitioner prayed that
its title to the subject property, which it repeatedly alleged to have acquired through continuous and
adverse possession and occupation of the said property for more than 30 years or since 1960, be
placed under the land registration laws. The allegations and prayer in the Application of petitioner
were sufficient to vest jurisdiction on the RTC over the said Application upon the filing thereof.
As to whether or not the subject property is indeed foreshore land is a factual issue which the
RTC should resolve in the exercise of its jurisdiction, after giving both parties the opportunity to
present their respective evidence at a full-blown trial.
Reconveyance
MODESTO LEOVERAS v. CASIMERO VALDEZ

G.R. No. 169985, 15 June 2011, THIRD DIVISION (Brion, J.)
Reconveyance is a remedy only available to the rightful owner of a land.
Modesto Leoveras and Casimero Valdez were sold the ½ share of Josefa Llamas over a parcel
of land in Pangasinan. The other half, owned by Alejandra Llamas, was earlier sold to Valdez. The
land was covered by Original Certificate of Title (OCT) No. 24695. In 1977, Leoveras and Valdez
executed an Affidavit of Adverse Claim over the subject property. Both of them thereafter took
possession of their respective portions of the subject property and declared it in their name for
taxation purposes.
In 1996, Valdez learned that Leoveras had already obtained in his name two transfer
certificates of title. But since the Register of Deeds (RD) could not produce OCT No. 24695, it instead
gave “petitioner’s documents”, namely: two deeds of absolute sale by the original owner Sta. Maria,
deed of absolute sale executed by Benigna Llamas (Alejandra and Josefa’s sister), subdivision plan,
and an affidavit of confirmation of subdivision.
Valdez filed a complaint for Annulment of Title, Reconveyance and Damages, seeking the
reconveyance of the 1,004-square meter portion (TCT No. 195813), on the ground that the latter is
entitled only to 3,020 square meters (TCT No. 195812).
Leoveras claimed that in signing the Agreement, he was led to believe, based on the parties
rough estimation, that the area he actually possessed is only 3,020 square meters contrary to the
parties’ real intention - i.e., the extent of their ownership would be based on their actual possession.
Leoveras further claimed that Valdez voluntarily participated in executing the Affidavit,
which corrected the mistake in the previously executed Agreement and confirmed Leoveras’
ownership over the disputed property.
The Regional Trial Court (RTC) dismissed the complaint because Valdez failed to
preponderantly prove that Benigna’s Deed and the Affidavit are fabricated and, consequently, no
ground exists to nullify Leoveras’ titles. The Court of Appeals (CA) reversed the decision.
ISSUES:
Whether or not the CA erred in ordering the reconveyance of the parcel of land covered by
Leoveras’ titles.
RULING:
YES. While Leoveras admitted using a spurious document in securing his titles, nonetheless,
he questions the CA’s nullification of TCT No. 195812 on the ground that, per Valdez’ own admission
and the parties’ Agreement, he is the rightful owner of the land covered by this title.
The Court does not agree. Leoveras’ argument confuses registration of title with ownership.
While Leoveras’ ownership over the land covered by TCT No. 195812 is undisputed, his ownership
only gave him the right to apply for the proper transfer of title to the property in his name. Obviously,
Leoveras, even as a rightful owner, must comply with the statutory provisions on the transfer of
registered title to lands. Section 53 of Presidential Decree No. 1529 provides that the subsequent
registration of title procured by the presentation of a forged deed or other instrument is null and
void. Thus, the subsequent issuance of TCT No. 195812 gave Leoveras no better right than the tainted
registration which was the basis for the issuance of the same title. The Court simply cannot allow
Leoveras’ attempt to get around the proper procedure for registering the transfer of title in his name
by using spurious documents.
While the CA correctly nullified Leoveras’ certificates of title, the CA erred in ordering the
reconveyance of the entire subject property in Valdez’ favor. Valdez himself admitted that the 3,020-
square meter portion covered by TCT No. 195812 is Leoveras’ just share in the subject property.
Thus, although Leoveras obtained TCT No. 195812 using the same spurious documents, the land
covered by this title should not be reconveyed in favor of Valdez since he is not the rightful owner of
the property covered by this title.
LORETO LUGA (DECEASED) SUBSTITUTED BY CELERINA LUGA DECEASED (WIFE) AND

CHILDREN v. SPS. ELENA AND ROGELIO ARCIAGA
Where there is a wrongful or erroneous registration in another person’s name, the rightful
owner or one with a better right can seek reconveyance of the property and cancellation of title.
The subject parcel of land used to form part of the Y. Furukawa Daliao Plantation which, after
being turned over to the Philippine government, was initially administered by the National Abaca
and Other Fibers Corporation (NAFCO) and, later, by the Board of Liquidators (BOL), pursuant to
Republic Act No. 477, as amended. Loreto Luga (Loreto) became a tenant of the BOL and, in said
capacity, occupied the subject parcel since 1957. However, it appears that an Occupant’s Affidavit
was executed by one Honorio Romero (Honorio), a former employee of NAFCO, over a 2.5 hectare
landholding of which the land in litigation formed part. Honorio executed a Deed of Transfer of Right
over a portion of said landholding in favor of Rogelio Arciaga (Rogelio). Elena, Rogelio’s wife, filed
an application for patent/title over the subject parcel, submitting the required Occupant’s Affidavit
of Application and other documents attesting to her actual possession of the subject parcel. Elena’s
application was granted resulting in the issuance of a Transfer Certificate of Title (TCT) in her favor.
Loreto filed a complaint for reconveyance of title and damages against Elena and Rogelio,
claiming that he had been in possession of the subject parcel since 1957, among others. The Regional
Trial Court (RTC) ruled that Loreto is entitled to the land in litigation since his possession thereof
preceded that asserted by the Spouses Arciaga. The Court of Appeals (CA), however, reversed and
held that Loreto was merely allowed to occupy the land in litigation by Spouses Arciaga’s
predecessor-in-interest, Honorio.
ISSUE:
Whether or not Loreto is entitled to the subject land.
RULING:
NO. A perusal of the record shows that, as the party asserting a right superior to that claimed
by the Spouses Arciaga, Loreto failed to prove that he was a bona fide occupant of the land in
litigation. Despite his testimony and that elicited from his witnesses, Canuto Blantucas and Sofronio
Obenque, to the effect that he occupied the subject parcel in 1957, Loreto’s documentary evidence
consisting of receipts issued by the NAFCO and BOL simply showed that he was a tenant on the
plantation from 1955 to 1957, remitting a portion of the produce harvested therefrom to said
government agencies. When cross-examined by the Spouses Arciaga’s counsel, Loreto also admitted
that he did not file any application for the land and/or declare the same for taxation purposes because
he knew that he was not the owner thereof.
As a determination made by the administrative agency tasked with the disposition of lands
transferred to the Republic of the Philippines, the BOL’s award and sale of the litigated parcel in favor
of Elena deserves utmost respect when supported by substantial evidence. An action for
reconveyance of a property is, after all, a legal and equitable remedy available to a landowner whose
property has been wrongfully or erroneously registered in another’s name, after one year from the
date of the decree of registration and so long as the property has not passed to an innocent purchaser
for value. The decree of registration is respected as incontrovertible. Where there is a wrongful or
erroneous registration in another person’s name, the rightful owner or one with a better right can
seek reconveyance of the property and cancellation of title. Loreto failed to prove a right than
petitioners over the land. The Court finds that the CA correctly ordered the dismissal of the complaint
for reconveyance and damages from which the instant suit originated.
ESTRELLA TIONGCO YARED (Deceased) substituted by CARMEN M. TIONGCO a.k.a. CARMEN

MATILDE B. TIONGCO v. JOSE B. TIONGCO and ANTONIO G. DORONILA, JR.
An action for reconveyance can indeed be barred by prescription. However, there is an exception
to this rule, when based on fraud, is imprescriptible as long as the land has not passed to an innocent
buyer for value.
The present dispute involves three parcels of land namely, Lots 3244, 3246 and 1404. While
all of the Heirs of Maria Luis de Tiongco have died, they were survived by their children and
descendants. Among the legitimate children of Jose were Carmen Tiongco (Carmen) and Carmelo
Tiongco, the father of Jose B. Tiongco (Jose). Sometime in 1965, Carmen built her house on Lot 1404
and sustained herself by collecting rentals from the tenants of Lots 3244 and 3246. Carmen, as one
of the heirs of Jose, filed an adverse claim affecting all the rights, interest and participation of her
deceased father on the disputed lots. In 1983, Jose prohibited Carmen from collecting rentals from
the tenants of Lots 3244 and 3246. Jose filed a suit for recovery of possession with preliminary
injunction against several tenants of Lots 3244 and 3246 wherein he obtained a judgment in his favor.
Jose also filed a case for unlawful detainer with damages against Carmen. While the RTC ruled in
Jose’s favor, the CA reversed the RTC’s decision and ruled in favor of Carmen. In 1988, when Carmen
inquired at the Office of the Register of Deeds, she discovered that Jose had already executed an
Affidavit of Adjudication declaring that he is the only surviving heir of the registered owners. It also
appears that when the TCTs covering Lots 3244 and 1404 were issued, Jose sold the said lots to
Catalino Torre. Similarly, Lot 3246 was likewise disposed of by Jose to Antonio Doronila, Jr.
(Doronila). Catalino Torre also sold Lots 3244 and 1404 on the same date to Doronila who was issued
the corresponding new TCTs. However, Doronila sold Lot 1404 back to Jose. Lots 3244 and 3246
were also sold back to Jose. Carmen filed a complaint before the court a quo against Jose and Doronila,
Jr. RTC ruled in favor of Jose. The court a quo ruled that prescription has set in since the complaint
was filed only some sixteen (16) years after Jose caused to be registered the affidavit of adjudication.
Aggrieved, Carmen appealed to the CA which, however, sustained the trial court’s ruling.
ISSUE:
Whether or not Carmen has the better right over the properties subject of litigation.
RULING:
YES. An action for reconveyance based on implied or constructive trust must perforce
prescribe in ten (10) years from the issuance of the Torrens title over the property. However, there
is an exception. In the case of Heirs of Pomposa Saludares v. Court of Appeals, the Court held that there
is but one instance when prescription cannot be invoked in an action for reconveyance, that is, when
the plaintiff is in possession of the land to be reconveyed. In Heirs of Pomposa Saludares, the Court
explained that the Court in a series of cases has permitted the filing of an action for reconveyance
despite the lapse of more than ten (10) years from the issuance of title to the land and declared that
said action, when based on fraud, is imprescriptible as long as the land has not passed to an innocent
buyer for value. In this case, Carmen never lost possession of the said properties, and as such, she is
in a position to file the complaint with the court a quo to protect her rights and clear whatever doubts
has been cast on her title by the issuance of TCTs in Jose’s name.
The Court further observes that the sale transactions of these properties from Jose to Catalino
Torre, then to Doronila and back again to Jose were quite unusual. However, this successive transfers
of title from one hand to another could not cleanse the illegality of Jose’s act of adjudicating to himself
all of the disputed properties so as to entitle him to the protection of the law as a buyer in good faith.
In this case, when the subject properties were sold to Catalino Torre and subsequently to Doronila,
Jose was not in possession of the said properties. But regardless of such defect on transfer to third
persons, the properties again reverted back to Jose. Jose cannot claim lack of knowledge of the defects
surrounding the cancellation of the OCTs over the properties and benefit from his fraudulent actions.
The subsequent sale of the properties to Catalino Torre and Doronila will not cure the nullity of the
certificates of title obtained by respondent Jose on the basis of the false and fraudulent Affidavit of
Adjudication.
Reconstitution
REPUBLIC OF THE PHILIPPINES v. CANDIDO, DEMETILA, JESUS, ANGELITO, and TERESITA, all
surnamed VERGEL DE DIOS
Without the order for reconstitution, the order to issue a new owner’s duplicate title had no leg
to stand on.
The Regional Trial Court (RTC) granted the Petition for Reconstitution of the Burned Original
of TCT No. T-141671 and Issuance of a New Owner’s Duplicate Copy in Lieu of the Destroyed One
filed by Candido Vergel De Dios, et al. (Candido, et al.). However, on appeal, the Court of Appeals (CA)
ruled that the photocopies of the subject TCT, survey plan, technical description, tax declaration, and
certification of the Register of Deeds were not sufficient to order a reconstitution of the lost title. It
also held as insufficient evidence the Kasulatan which was executed only in 1996, long after the
original TCT was burned and the owner’s duplicate title was lost. The CA, however, noted that the
appeal merely questioned the order granting reconstitution; it did not question the order for the
issuance of a new owner’s duplicate title. Hence, it held as final and executory the portion of the
Decision ordering the issuance of a new owner’s duplicate title.
ISSUE:
Whether or not the CA erred in maintaining and declaring as final and executory the order
for the issuance of a new owner’s duplicate title despite its judgment deleting the trial court’s order
for reconstitution.
RULING:
YES. The CA erred in not deleting the trial court’s order for the issuance of a new owner’s
duplicate title to Candido, et al. after it deleted the order for reconstitution. The reconstitution of a
certificate of title denotes restoration in the original form and condition of a lost or destroyed
instrument attesting the title of a person to a piece of land. The purpose of the reconstitution of title
is to have, after observing the procedures prescribed by law, the title reproduced in exactly the same
way it has been when the loss or destruction occurred.
The lost or destroyed document referred to is the one that is in the custody of the Register of
Deeds. When reconstitution is ordered, this document is replaced with a new one. After the
reconstitution, the owner is issued a duplicate copy of the reconstituted title.
Petitioner went to great lengths to convince the CA that the order for the issuance of a
duplicate title to Candido, et al. was included in its appeal. The Court finds such exercise unnecessary.
The CA should not have been quick in declaring that such order had already become final and
executory. It really does not matter if petitioner did not specifically question the order for the
issuance of a new owner’s duplicate title. The fact that petitioner prayed for the dismissal of the
petition for reconstitution meant that it was questioning the order for reconstitution and all orders
corollary thereto. The trial court’s order for the Register of Deeds to issue a new duplicate certificate
of title was only an offshoot of its having granted the petition for reconstitution of title. Without the
order for reconstitution, the order to issue a new owner’s duplicate title had no leg to stand on.
BIENVENIDO CASTILLO v. REPUBLIC OF THE PHILIPPINES

The trial court did not acquire jurisdiction over the petition for reconstitution if the
requirements prescribed in Sections 12 and 13 of R.A. No. 26 were not complied with.
Bienvenido filed a Petition for Reconstitution and Issuance of Second Owners Copy of
Transfer Certificate of Title (TCT) No. T-16755.
Upon the Land Registration Authority’s (LRA) request, the trial court ordered Bienvenido to
submit within 15 days from receipt of the order (a) the original of the technical description of the
parcel of land covered by the lost/destroyed certificate of title, certified by the authorized officer of
the Land Management Bureau/Land Registration Authority and two duplicate copies thereof, and (b)
the sepia film plan of the subject parcel of land prepared by a duly licensed Geodetic Engineer, who
shall certify thereon that its preparation was made on the basis of a certified technical description,
and two blue print copies thereof. Bienvenido complied.
The trial court also ordered Bienvenido to supply the names and addresses of the occupants
of the subject property. He manifested that there is no actual occupant in the subject property.
The trial court’s order to conduct a hearing was posted on three public bulletin boards and
was also published twice in the Official Gazette.
During the hearing, Fernando Castillo–Bienvenido’s son and attorney-in-fact–stated that the
title was issued in the names of his parents, Bienvenido Castillo and Felisa Cruz (Felisa), and that his
mother died in 1982. He did not mention any sibling. He added that in February
2002, Bienvenido executed an Affidavit of Loss which stated that he misplaced the owner’s copy of
the certificate of title sometime in April 1993 and that all efforts to locate the same proved futile. The
title is free from all liens and encumbrances, and there are no other persons claiming interest over
the land.
The Regional Trial Court (RTC) granted the reconstitution of title. The Court of Appeals (CA)
reversed the decision on the ground that the documentary evidences presented before the trial court
were insufficient to support reconstitution. The loss of the original copy on file with the Registry of
Deeds of Bulacan may be credible, but Bienvenido failed to adequately explain the circumstances
that led to the loss of the owner’s copy.
ISSUE:
Whether or not the reconstitution of title should be granted.
RULING:
NO. There can be no reconstitution as the trial court never acquired jurisdiction over the
present case. Section 12 of R.A. No. 26 describes the requirements for a petition for reconstitution.
The Court compared the requirements of Section 12 to the allegations in Bienvenido’s

petition. Bienvenido’s petition complied with items (a), (b), (f) and (g): in paragraph 5 of the petition,
he alleged the loss of his copy of TCT No. T-16755; paragraph 6 declared that no co-owners copy of
the duplicate title has been issued; paragraph 10 stated that the property covered by the lost TCT is
free from liens and encumbrances; and paragraph 11 stated that there are no deeds or instruments
presented for or pending registration with the Register of Deeds.
There was substantial compliance as to item (c): the location of the property is mentioned in
paragraph 2; while the boundaries of the property, although not specified in the petition, refer to an
annex attached to the petition.
The petition did not mention anything pertaining to item (d). There was also a failure to fully
comply with item (e). By Fernando’s admission, there exist two other co-owners of the property
covered by TCT No. T-16755. Fernando’s siblings Emma and Elpidio were not mentioned anywhere
in the petition.
Section 13 of R.A. No. 26 prescribes the requirements for a notice of hearing of the petition.
The trial court’s order was indeed posted in the places mentioned in Section 13. The notice, however,
did not state Felisa as a registered co-owner. Neither did the notice identify Fernando’s siblings
Emma and Elpidio as interested parties.
The non-compliance with the requirements prescribed in Sections 12 and 13 of R.A. No. 26 is
fatal. Hence, the trial court did not acquire jurisdiction over the petition for reconstitution.
TORTS AND DAMAGES
Negligence
ALBERT TISON and CLAUDIO L. JABON v. SPS. GREGORIO POMASIN, et al.

Negligence, consisting in whole or in part, of violation of law, like any other negligence, is
without legal consequence unless it is a contributing cause of the injury.
Two vehicles, a tractor-trailer and a jitney, figured in a vehicular mishap along Maharlika
Highway in Barangay Agos, Polangui, Albay. Laarni Pomasin (Laarni) was driving the jitney while the
tractor-trailer was driven by Claudio Jabon (Jabon). Multiple death and injuries to those in the jitney
resulted. On the other hand, Jabon and one of the passengers in the tractor-trailer were injured.
Albert Tison (Tison), the owner of the truck, extended financial assistance to respondents by
giving them P1,000.00 each immediately after the accident and P200,000.00 to Cynthia Pomasin
(Cynthia), one of Gregorio’s daughters. Cynthia, in turn, executed an Affidavit of Desistance.
Respondents filed a complaint for damages against petitioners before the RTC of
Antipolo. They alleged that the proximate cause of the accident was the negligence, imprudence and
carelessness of Jabon. The RTC rendered judgment in favor of Tison and Jabon dismissing the
complaint for damages. The trial court likewise upheld the Affidavit of Desistance as having been
executed with the tacit consent of respondents. On appeal to the CA, it disagreed with the trial court
and ruled that the reckless driving of Jabon caused the vehicular collision. The CA disregarded the
Affidavit of Desistance executed by Cynthia because the latter had no written power of attorney from
respondents and that she was so confused at the time when she signed the affidavit that she did not
read its content.
ISSUE:
Whether or not Jabon and Tison are liable.
RULING:
NO. Clearly, the negligence of Gregorio’s daughter, Laarni was the proximate cause of the
accident. The trial court found that the jitney driver was negligent.
One reason why the trial court found credible the version of Jabon was because his
concentration as driver is more focused than that of a mere passenger. While it is logical that a
driver’s attention to the road travelled is keener than that of a mere passenger, it should also be
considered that the logic will hold only if the two are similarly circumstanced, and only as a general
rule, so that, it does not necessarily follow that between the opposing testimonies of a driver and a
passenger, the former is more credible. The factual setting of the event testified on must certainly be
considered.
The trial court did just that in the instant case. Contrary to the observation of the Court of
Appeals, the relative positions of a driver and a passenger in a vehicle was not the only basis of
analysis of the trial court. Notably, aside from Jabon’s alleged vantage point to clearly observe the
incident, the trial court also took into consideration Gregorio’s admission that prior to the accident,
the jitney was running on the curving and downward portion of the highway. The appellate court,
however, took into account the other and opposite testimony of Gregorio that it was their jitney that
was going uphill and when it was about to reach a curve, he saw the incoming truck running very fast
and encroaching the jitney’s lane.
The Court did not lose sight of the fact that at the time of the incident, Jabon was prohibited
from driving the truck due to the restriction imposed on his driver’s license, i.e., restriction code 2
and 3. As a matter of fact, Jabon even asked the Land Transportation Office to reinstate his articulated
license containing restriction code 8 which would allow him to drive a tractor-trailer. The Court of
Appeals concluded therefrom that Jabon was violating a traffic regulation at the time of the collision.
Driving without a proper license is a violation of traffic regulation. Under Article 2185 of the
Civil Code, the legal presumption of negligence arises if at the time of the mishap, a person was
violating any traffic regulation. However, in Sanitary Steam Laundry, Inc. v. Court of Appeals, we held
that a causal connection must exist between the injury received and the violation of the traffic
regulation. It must be proven that the violation of the traffic regulation was the proximate or legal
cause of the injury or that it substantially contributed thereto. Negligence, consisting in whole or in
part, of violation of law, like any other negligence, is without legal consequence unless it is a
contributing cause of the injury.
In the instant case, no causal connection was established between the tractor-trailer driver’s
restrictions on his license to the vehicular collision. Furthermore, Jabon was able to sufficiently
explain that the Land Transportation Office merely erred in not including restriction code 8 in his
license.
Principle of Vicarious Liability
RCJ BUS LINES, INCORPORATED v. STANDARD INSURANCE COMPANY, INCORPORATED

When the employee causes damage due to his own negligence while performing his own duties,
there arises the juris tantum presumption that the employer is negligent, rebuttable only by proof of
observance of the diligence of a good father of a family.
In 1994, Flor B. Mangoba (Mangoba) while driving an RCJ passenger bus, operated by RCJ Bus
Lines, Inc. (RCJ), along the National Highway at Brgy. Amlang, Rosario, La Union bumped and hit a
1991 Mitsubishi Lancer GLX owned by Rodelene Valentino (Valentino). Said vehicle was insured for
loss and damage with Standard Insurance Co., Inc. (Standard) for P450,000.00, As a direct and
proximate cause of the vehicular accident, the Mitsubishi Lancer was extensively damaged, the costs
of repairs of which were borne by Standard Insurance. By virtue of the insurance contract, Standard
Insurance paid Valentino for the repair of the Mitsubishi Lancer car. Thereafter, Standard Insurance
was subrogated to the rights of Valentino against RCJ. Despite demands, RCJ have failed and refused
to reimburse Standard Insurance the sum it paid to Valentino.
Standard filed an complaint against Mangoba and RCJ. The MeTC rendered its decision in
favor of Standard. The RTC affirmed with modification the MeTC’s Decision deleted the award for
exemplary damages. Mangoba and RCJ filed a petition for review before the appellate court. CA
affirmed RCJ’s liability as registered owner of the bus and employer of Mangoba, as well as Mangobas
negligence in driving the passenger bus. It however, deleted the award for attorney’s fees and
modified the legal interest imposed by the MeTC. The appellate court denied RCJ’s Motion for
Reconsideration for lack of merit.
ISSUE:
Whether or not RCJ is liable.
RULING:
YES. Standard may hold RCJ liable for two reasons, both of which rely upon facts
uncontroverted by RCJ. One, RCJ is the registered owner of the bus driven by Mangoba. Two, RCJ is
Mangoba’s employer.
Standard’s allegation in its amended complaint that RCJ is the registered owner of the
passenger bus with plate number NYG 363 was sufficient to state a cause of action against RCJ. The
registered owner of a vehicle should be primarily responsible to the public for injuries caused while
the vehicle is in use. The main aim of motor vehicle registration is to identify the owner so that if any
accident happens, or that any damage or injury is caused by the vehicle on the public highways,
responsibility therefor can be fixed on a definite individual, the registered owner.
Moreover, in its efforts to extricate itself from liability, RCJ proffered the defense of the
exercise of the diligence of a good father of a family. RCJ, by presenting witnesses to testify on its
exercise of diligence of a good father of a family in the selection and supervision of its bus drivers,
admitted that Mangoba is its employee. Article 2180 of the Civil Code, in relation to Article 2176,
makes the employer vicariously liable for the acts of its employees. When the employee causes
damage due to his own negligence while performing his own duties, there arises the juris tantum
presumption that the employer is negligent, rebuttable only by proof of observance of the diligence
of a good father of a family. For failure to rebut such legal presumption of negligence in the selection
and supervision of employees, the employer is likewise responsible for damages, the basis of the
liability being the relationship of pater familias or on the employer’s own negligence.
Mangoba, per testimony of his conductor, was ten meters away from the Mitsubishi Lancer
before the collision and was driving 60 to 75 kilometers per hour when the speed limit was 50
kilometers per hour. The presumption under Article 2185 of the Civil Code was thus proven true:
Mangoba, as driver of the bus which collided with the Mitsubishi Lancer, was negligent since he
violated a traffic regulation at the time of the mishap.
Proximate Cause Doctrine
SPOUSES LUIGI M. GUANIO and ANNA HERNANDEZ-GUANIO v. MAKATI SHANGRI-LA HOTEL

and RESORT, INC., also doing business under the name of SHANGRI-LA HOTEL MANILA
G.R. No. 190601, 7 February 2011, THIRD DIVISION (CARPIO-MORALES, J.)
The doctrine of proximate cause is applicable only in actions for quasi-delicts, not in actions
involving breach of contract.
Spouses Luigi M. Guanio and Anna Hernandez-Guanio (Spouses Guanio) booked their
wedding reception at the Shangri-la Hotel Makati. They claimed that during the event, their guests
complained of the delay in the service of the dinner, and the hotel’s waiters were rude and
unapologetic when confronted about the delay. Spouses Guanio thus sent a letter-complaint to
Makati Shangri-la Hotel and Resort, Inc. (MSHRI) and received an apologetic reply from Krister
Svensson (Svensson), the hotel’s Executive Assistant Manager in charge of Food and Beverage. They
nevertheless filed a complaint for breach of contract and damages before the Regional Trial Court
(RTC). MSHRI contended that while there was a delay in the service of the meals, the same was
occasioned by the sudden increase of guests to 470 from the guaranteed expected minimum number
of guests of 350 to a maximum of 380, as stated in the Banquet Event Order (BEO). Respecting the
belated service of meals to some guests, MSHRI attributed it to the insistence of Spouses Guanio’s
wedding coordinator that certain guests be served first.
Relying on the letter of Svensson, the RTC ruled in favor of Spouses Guanio. It observed that
from the tenor of the letter, MSHRI admitted that the services the Spouses Guanio received were
unacceptable and definitely not up to their standards. The Court of Appeals (CA), however, reversed
the RTC and held that the proximate cause of Spouses Guanio’s injury was the unexpected increase
in their guests.
ISSUE:
Whether or not the doctrine of proximate cause applies in the instant case.
RULING:
NO. The Court finds that since Spouses Guanio’s complaint arose from a contract, the doctrine
of proximate cause finds no application to it. The doctrine of proximate cause is applicable only
in actions for quasi-delicts, not in actions involving breach of contract. The doctrine is a device for
imputing liability to a person where there is no relation between him and another party. In such a
case, the obligation is created by law itself. But, where there is a pre-existing contractual relation
between the parties, it is the parties themselves who create the obligation, and the function of the
law is merely to regulate the relation thus created.
What applies in the present case is Article 1170 of the Civil Code. Breach of contract is defined
as the failure without legal reason to comply with the terms of a contract. It is also defined as the
failure, without legal excuse, to perform any promise which forms the whole or part of the contract.
The appellate court, and even the trial court, observed that Spouses Guanio were remiss in their
obligation to inform MSHRI of the change in the expected number of guests. The observation is
reflected in the records of the case. Spouses Guanio’s failure to discharge such obligation thus
excused MSHRI from liability for any damage or inconvenience occasioned thereby.
VALLACAR TRANSIT, INCORPORATION v. JOCELYN G. CATUBIG

Proximate cause is that cause, which, in natural and continuous sequence, unbroken by any
efficient intervening cause, produces the injury, and without which the result would not have occurred.
Quirino Cabanilla was employed as a regular bus driver by Ceres Bulilit. He got involved in a
collision with Jocelyn Catubig’s husband, Quintin, and Teddy Emparado. Quintin and Teddy were
thrown from the motorcycle. Quintin died on the spot, and Teddy died while being rushed to the
hospital. Cabanilla was charged with reckless imprudence resulting in double homicide.
The Municipal Circuit Trial Court (MCTC) ruled that Cabanilla was not criminally liable
because there was no negligence on his part. Thereafter, Jocelyn filed a complaint for damages with
the Regional Trial Court (RTC), which eventually ruled in favor of Vallacar Transit, Inc. (VTI), finding
that the proximate cause of the colision of the bus and motorcycle was the negligence of the driver of
the motorcycle, Quintin. But according to the Court of Appeals (CA), both Quintin and Cabanilla were
negligent in driving their respective vehicles. Quintin, on one hand, failed to use reasonable care for
his own safety and ignored the hazard when he tried to overtake a truck at a curve. Cabanilla, on the
other hand, was running his vehicle at a speed of 100 km/hour.
ISSUE:
Whether or not the bus company, Vallacar Transit, should be held liable for the negligence of
its employee/bus driver.
RULING:
NO. Article 2180 of the Civil Code imputing fault of negligence on the part of the employer for
the fault of negligence of its employee does not apply to VTI since the fault of negligence of its
employee driver, Cabanilla, which would have made the latter liable for quasi-delict under Article
2176 of the Civil Code, has never been established.
Proximate cause is defined as that cause, which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the injury, and without which the result would
not have occurred. The evidence shows that the driver of the bus, Cabanilla, was driving his vehicle
along the proper lane, while the driver of the motorcycle, Quintin, had overtaken a vehicle ahead of
him as he was approaching a curvature on the road, in disregard of the provision of the law on
reckless driving, at the risk of his life and that of his employee, Teddy. The presumption that
employers are negligent under Article 2180 flows from the negligence of their employees. Since there
was no fault or negligence on the part of Cabanilla, then such presumption of fault or negligence on
the part of VTI does not even arise.
Medical Negligence
DR. RUBI LI v. SPOUSES REYNALDO and LINA SOLIMAN, as parents/heirs of deceased
Angelica Soliman,
G.R. No. 165279, 07 June 2011, EN BANC (Villarama, Jr., J.)
In order to successfully pursue a medical negligence claim, a patient must prove that a health
care provider, in most cases a physician, either failed to do something which a reasonably prudent health
care provider would have done, or that he or she did something that a reasonably prudent provider
would not have done; and that that failure or action caused injury to the patient.
On July 7, 1993, 11-year old, Angelica Soliman (Angelica), daughter of Spouses Reynaldo and
Lina Soliman (Spouses Soliman) underwent a biopsy of the mass located in her lower extremity at
the St. Lukes Medical Center (SLMC). Results showed that Angelica was suffering
from osteosarcoma, osteoblastic type, a high-grade (highly malignant) cancer of the bone which
usually afflicts teenage children. Following this diagnosis and as primary intervention, Angelica’s
right leg was amputated by Dr. Jaime Tamayo (Dr. Tamayo) in order to remove the
tumor. Chemotherapy was thereafter suggested by Dr. Tamayo. He referred Angelica to another
doctor at SLMC, herein petitioner Dr. Rubi Li (Dr. Li), a medical oncologist.
On August 18, 1993, Angelica was admitted to SLMC. However, she died on September 1,
1993, just eleven (11) days after the (intravenous) administration of the first cycle of the
chemotherapy regimen. The Medico-Legal Report issued indicated the cause of death as
Hypovolemic shock secondary to multiple organ hemorrhages and Disseminated Intravascular
Coagulation. Because of this, Spouses Soliman filed a damage suit against Dr. Li, Dr. Leo Marbella, Mr.
Jose Ledesma, a certain Dr. Arriete and SLMC. Spouses Soliman charged them with negligence and
disregard of Angelicas safety, health and welfare by their careless administration of the
chemotherapy drugs, their failure to observe the essential precautions in detecting early the
symptoms of fatal blood platelet decrease and stopping early on the chemotherapy, which bleeding
led to hypovolemic shock that caused Angelica’s untimely demise. Further, it was specifically averred
that Dr. Li assured the parents that Angelica would recover in view of 95% chance of healing with
chemotherapy and when asked regarding the side effects, petitioner mentioned only slight vomiting,
hair loss and weakness. Spouses Soliman thus claimed that they would not have given their consent
to chemotherapy had Dr. Li not falsely assured them of its side effects.
On the other hand, Dr. Li denied having been negligent in administering the chemotherapy
drugs to Angelica and asserted that she had fully explained to Spouses Soliman how the
chemotherapy will affect not only the cancer cells but also the patients normal body parts, including
the lowering of white and red blood cells and platelets. She claimed that what happened to Angelica
can be attributed to malignant tumor cells possibly left behind after surgery. Few as they may be,
these have the capacity to compete for nutrients such that the body becomes so weak structurally
(cachexia) and functionally in the form of lower resistance of the body to combat infection. Such
infection becomes uncontrollable and triggers a chain of events (sepsis or septicemia) that may lead
to bleeding in the form of Disseminated Intravascular Coagulation (DIC), as what the autopsy report
showed in the case of Angelica.
ISSUE:
Whether or not Dr. Li is liable for failure to fully disclose serious side effects to the parents of
the child patient who died while undergoing chemotherapy, despite the absence of finding that she
was negligent in administering the said treatment.
RULING:
NO. There was an absence of finding that Dr. Li was negligent in administering the said
treatment. The Court established that there was adequate disclosure of material risks inherent in the
chemotherapy procedure performed with the consent of Angelica’s parents. By the nature of the
disease itself, each patient’s reaction to the chemical agents even with pre-treatment laboratory tests
cannot be precisely determined by the physician. That death can possibly result from complications
of the treatment or the underlying cancer itself, immediately or sometime after the administration of
chemotherapy drugs, is a risk that cannot be ruled out, as with most other major medical
procedures, but such conclusion can be reasonably drawn from the general side effects of
chemotherapy already disclosed.
The type of lawsuit which has been called medical malpractice or, more appropriately,
medical negligence, is that type of claim which a victim has available to him or her to redress a wrong
committed by a medical professional which has caused bodily harm. In order to successfully pursue
such a claim, a patient must prove that a health care provider, in most cases a physician, either failed
to do something which a reasonably prudent health care provider would have done, or that he or she
did something that a reasonably prudent provider would not have done; and that that failure or
action caused injury to the patient.
Moreover, the Court has recognized that medical negligence cases are best proved by
opinions of expert witnesses belonging in the same general neighborhood and in the same general
line of practice as defendant physician or surgeon. In this case, the alleged negligence of Dr. Li in the
administration of chemotherapy drugs to Angelica was not proven considering that Drs. Vergara and
Balmaceda, not being oncologists or cancer specialists, were not qualified to give expert opinion as
to whether Dr. Li’s lack of skill, knowledge and professional competence in failing to observe the
standard of care in her line of practice was the proximate cause of the patients death.
Furthermore, the doctrine of informed consent has been cited which states that “every
human being of adult years and sound mind has a right to determine what shall be done with his own
body; and a surgeon who performs an operation without his patients consent, commits an assault,
for which he is liable in damages”. It evolved into a general principle of law that a physician has a
duty to disclose what a reasonably prudent physician in the medical community in the exercise of
reasonable care would disclose to his patient as to whatever grave risks of injury might be incurred
from a proposed course of treatment, so that a patient, exercising ordinary care for his own welfare,
and faced with a choice of undergoing the proposed treatment, or alternative treatment, or none at
all, may intelligently exercise his judgment by reasonably balancing the probable risks against the
probable benefits.
The Court found it difficult to give credence to the claim that Dr. Li told the Spouses Soliman
of 95% chance of recovery for their daughter, as it was unlikely for doctors who were dealing with
grave conditions such as cancer to have falsely assured patients of chemotherapy’s success rate.
Informed consent laws in other countries generally require only a reasonable explanation of
potential harms, so specific disclosures such as statistical data, may not be legally necessary.
Diligence for Banking Institutions
PHILIPPINE NATIONAL BANK v. F.F. CRUZ AND CO., INC.

As between a bank and its depositor, where the bank’s negligence is the proximate cause of the loss and
the depositor is guilty of contributory negligence, the greater proportion of the loss shall be borne by the bank.
F.F. Cruz and Co., Inc. (FFCCI) had a combo account with Philippine National Bank (PNB) with
President Felipe Cruz and Secretary-Treasurer Angelita Cruz as signatories. Both went to the United
States of America. While they were out of the country, two checks were presented to PNB for
approval, one worth P9,950,000.00 payable to a certain Gene B. Sangalang and the other one was
for P3,260,500.31 payable to one Paul Bautista. PNB approved the checks and debited the amount
from the account of FFCCI.
When Angelita returned she discovered the amounts debited from their account and
requested PNB to credit back the amount lost. PNB refused. FFCCI then instituted a case against PNB
and FFCCI’s accountant for damages. In its defense, PNB alleged that it exercised due diligence
because it followed the standard banking procedure; and it was FFCCI which was negligent because
of its delay in reporting to PNB the anomalous transaction.
The Regional Trial Court held that although both FFCCI and PNB are guilty of negligence, it is
PNB which should bear the whole loss. According to the Court of Appeals, however, PNB and FFCCI
should bear the loss in a 60%-40% ratio, respectively.
ISSUE:
Whether or not PNB is guilty of negligence despite its defense that it followed the usual
banking procedure to verify the checks.
RULING:
YES. PNB failed to make the proper verification because the applications for the managers
check do not bear the signature of the bank verifier. PNB concedes the absence of the subject
signature but argues that the same was the result of inadvertence. It posits that the testimonies of
Geronimo Gallego, then the branch manager of PNB Timog Branch, and Stella San Diego, then branch
cashier, suffice to establish that the signature verification process was duly followed.
The Court is not persuaded. First, oral testimony is not as reliable as documentary evidence.
Second, PNB’s own witness, San Diego, testified that in the verification process, the principal duty to
determine the genuineness of the signature devolved upon the account analyst. However, PNB did
not present the account analyst to explain his or her failure to sign the box for signature and balance
verification of the subject applications for managers check, thus, casting doubt as to whether he or
she did indeed verify the signatures thereon. Third, the appellate court cannot be faulted for not
giving weight to the testimonies of Gallego and San Diego considering that the latter are naturally
interested in exculpating themselves from any liability arising from the failure to detect the forgeries
in the subject transactions. Fourth, Gallego admitted that PNB’s employees received training on
detecting forgeries from the National Bureau of Investigation. However, Emmanuel Guzman, then
NBI senior document examiner, testified, as an expert witness, that the forged signatures in the
subject applications for managers check contained noticeable and significant differences from the
genuine signatures of FFCCI’s authorized signatories and that the forgeries should have been
detected or observed by a trained signature verifier of any bank.
Given the foregoing, PNB was negligent in the handling of FFCCIs combo account, specifically,
with respect to PNB’s failure to detect the forgeries in the subject applications for managers check
which could have prevented the loss. As often ruled, the banking business is impressed with public
trust. A higher degree of diligence is imposed on banks relative to the handling of their affairs than
that of an ordinary business enterprise. Thus, the degree of responsibility, care and trustworthiness
expected of their officials and employees is far greater than those of ordinary officers and employees
in other enterprises.
In the case at bar, PNB failed to meet the high standard of diligence required by the
circumstances to prevent the fraud. In Philippine Bank of Commerce v. Court of Appeals and The
Consolidated Bank & Trust Corporation v. Court of Appeals, where the bank’s negligence is the
proximate cause of the loss and the depositor is guilty of contributory negligence, the Court allocated
the damages between the bank and the depositor on a 60-40 ratio. The same ruling applies in this
case considering that, as shown above, PNB’s negligence is the proximate cause of the loss while the
issue as to FFCCI’s contributory negligence has been settled with finality in G.R. No. 173278.
DAMAGES
Actual Damages
LETICIA TAN, et al. v. OMC CARRIERS, INC. and BONIFACIO ARAMBALA

Actual damages, to be recoverable, must not only be capable of proof, but must actually be
proved with a reasonable degree of certainty.
The record shows that the truck owned by OMC Carriers, Inc. (OMC) and driven by Bonifacio
Arambala lost its break and rammed into the house and tailoring shop owned by Leticia Tan and her
husband Celedonio Tan, instantly killing Celedonio. This prompted Leticia Tan et al. to file complaint
for damages with the RTC against OMC Carriers, Inc. (OMC) and Bonifacio Arambala. Tan et al. alleged
that the accident was due to the gross negligence of OMC and its driver and they should be held
solidarily liable. Consequently, Tan et al. demanded actual damages, moral damages, exemplary
damages, and attorney’s fees.
After trial, the RTC ruled in favor of Tan et al. and holding that OMC and Arambala solidarily
liable for damages. The RTC the amount of P355,895.00 for actual damages, P500,000.00 for the loss
of earning capacity of Celedonio Tan, P500,000.00 as moral damages, P500,000.00 as exemplary
damages and attorney’s fee.
On appeal, the CA affirmed the RTC’s findings with modification as to the amount of damages.
The CA reduced the amount of actual damages awarded by the RTC holding that only P72,295.00 was
only the amount duly supported by official receipts. The CA also deleted the RTC’s award for loss of
earning capacity since Celedonio’s earning capacity was not proven with reasonable certainty. Lastly,
the CA reduced the award of exemplary damages from P500,000.00 to P200,000.00.
ISSUES:
1. Whether or not the reduction of actual damages is proper.
2. Whether or not the deletion of the award for loss of earning capacity is proper.
3. Whether or not the reduction of exemplary damages is proper.
RULING:
1. YES. Actual damages, to be recoverable, must not only be capable of proof, but must actually
be proved with a reasonable degree of certainty. Courts cannot simply rely on speculation, conjecture
or guesswork in determining the fact and amount of damages. To justify an award of actual damages,
there must be competent proof of the actual amount of loss, credence can be given only to claims
which are duly supported by receipts.
Tan et al. do not deny that they did not submit any receipt to support their claim for actual
damages to prove the monetary value of the damage caused to the house and tailoring shop when the
truck rammed into them. Thus, no actual damages for the destruction to Leticia Tan’s house and
tailoring shop can be awarded.
Nonetheless, absent competent proof on the actual damages suffered, a party still has the
option of claiming temperate damages, which may be allowed in cases where, from the nature of the
case, definite proof of pecuniary loss cannot be adduced although the court is convinced that the
aggrieved party suffered some pecuniary loss. The photographs presented as evidence show the
extent of the damage done to the house, the tailoring shop and the Tans’ appliances and
equipment. Irrefutably, this damage was directly attributable to Arambala’s gross negligence in
handling OMC’s truck. Unfortunately, these photographs are not enough to establish the amount of
the loss with certainty. From the attendant circumstances and given the property destroyed, the
amount of P200,000.00 as a fair and sufficient award by way of temperate damages.
2. YES. As a rule, documentary evidence should be presented to substantiate the claim for loss
of earning capacity. By way of exception, damages for loss of earning capacity may be awarded
despite the absence of documentary evidence when: (1) the deceased is self-employed and earning
less than the minimum wage under current labor laws, in which case, judicial notice may be taken of
the fact that in the deceased's line of work, no documentary evidence is available; or (2) the deceased
is employed as a daily wage worker earning less than the minimum wage under current labor laws.
However, Celedonio’s alleged monthly income of P13,000.00 greatly exceeded the prevailing
monthly minimum wage; thus, the exception set forth above does not apply. Nonetheless, temperate
damages may be awarded in lieu of actual damages for loss of earning capacity where earning
capacity is plainly established but no evidence was presented to support the allegation of the injured
party’s actual income. In the present case, the income-earning capacity of the deceased was never
disputed. Therefore, Tan et al. are entitled to temperate damages in the amount of P300,000.00 to
compensate for damages for loss of the earning capacity of the deceased.
3. YES. Celedonio Tan’s death and the destruction of the petitioners’ home and tailoring shop
were unquestionably caused by the respondents’ gross negligence. The law allows the grant of
exemplary damages in cases such as this to serve as a warning to the pubic and as a deterrent against
the repetition of this kind of deleterious actions. The grant, however, should be tempered, as it is not
intended to enrich one party or to impoverish another.
OCEANEERING CONTRACTORS (PHILS.), INC. v. NESTOR N. BARRETTO, doing business as

N.N.B. LIGHTERAGE
G.R. No. 184215, 9 February 2011, FIRST DIVISION (Perez, J.)
Actual or compensatory damages are those damages which the injured party is entitled to
recover for the wrong done and injuries received when none were intended.
Nestor N. Barretto (Barretto) and Oceaneering Contractors (Phils.) Inc. (Oceaneering)

entered into a Time Charter Agreement whereby Oceaneering hired Barretto’s barge Antonieta for
the purpose of transporting construction materials from Manila to Ayungon, Negros Oriental. During
the voyage, the said barge capsized. Barretto then informed Oceaneering that it was going to proceed
with the salvage, refloating and repair of the barge. In turn, Oceaneering demanded from Barretto
the return of the unused charter payment and the reimbursement of its salvaging expenses.
Thereafter, Barretto filed a complaint for damages against Oceaneering before the Regional Trial
Court (RTC) contending that the accident was attributable to the incompetence and negligence which
attended the loading of the cargo by Oceaneering’s hired employees. Averring that the accident was
caused by the negligence of Barretto’s employees and the dilapidated hull of the barge which
rendered it unseaworthy, Oceaneering filed its counterclaims praying for the value of its cargo,
salvaging expenses, exemplary damages, attorney’s fees and litigation expenses.
The RTC dismissed Barretto’s complaint for failure to adduce evidence to prove that the
accident was due to the negligence of Oceaneering’s employees. It also dismissed Oceaneering’s
counterclaims as the value of its cargo was not included in the demand letters it served Barretto. The
Court of Appeals (CA) reversed and ruled that the sinking of the vessel created a presumption of
negligence and/or unseaworthiness which Barretto failed to overcome and gave rise to his liability
for Oceaneering’s lost cargo despite the latter’s failure to insure the same. Applying the rule, however,
that actual damages should be proved with a reasonable degree of certainty, the CA denied
Oceaneering’s claim for the value of its lost cargo.
ISSUE:
Whether or not Oceaneering is entitled to actual damages or the value of its cargo.
RULING:
YES. In finding Oceaneering’s petition impressed with partial merit, uppermost in the Court’s
mind is the fact that actual or compensatory damages are those damages which the injured party is
entitled to recover for the wrong done and injuries received when none were intended. Pertaining as
they do to such injuries or losses that are actually sustained and susceptible of measurement, they
are intended to put the injured party in the position in which he was before he was injured. Insofar
as actual or compensatory damages are concerned, Article 2199 of the Civil Code of the
Philippines provides that except as provided by law or by stipulation, one is entitled to an adequate
compensation only for such pecuniary loss suffered by him as he has duly proved.
Conformably with the said provision, the rule is long and well settled that there must be
pleading and proof of actual damages suffered for the same to be recovered. In addition to the fact
that the amount of loss must be capable of proof, it must also be actually proven with a reasonable
degree of certainty, premised upon competent proof or the best evidence obtainable. The burden of
proof of the damage suffered is, consequently, imposed on the party claiming the same who should
adduce the best evidence available in support thereof, like sales and delivery receipts, cash and check
vouchers and other pieces of documentary evidence of the same nature. In the absence of
corroborative evidence, it has been held that self-serving statements of account are not sufficient
basis for an award of actual damages. Corollary to the principle that a claim for actual damages cannot
be predicated on flimsy, remote, speculative, and insubstantial proof, courts are, likewise, required
to state the factual bases of the award.
Applying the just discussed principles to the case at bench, the Court finds that Oceaneering
correctly fault the CA for not granting its claim for actual damages or, more specifically, the portions
thereof which were duly pleaded and adequately proved before the RTC. While concededly not
included in the demand letters dated 12 March 1998 and 13 July 1998 Oceaneering served Barretto,
the former’s counterclaims for the value of its lost cargo in the sum of P4,055,700.00 and salvaging
expenses in the sum of P125,000.00 were distinctly pleaded and prayed for in the 26 January 1999
answer it filed a quo. Rather than the entire P4,055,700.00 worth of construction materials reflected
in the inventory which Engr. Oracion claims to have prepared on 29 November 1997, based on the
delivery and official receipts from Oceaneering’s suppliers, the Court is, however, inclined to grant
only the items which were duly proved by the vouchers and receipts on record. The foregoing sums
all add up to of P2,577,620.00 from which should be deducted the sum of P351,000.00 representing
the value of the nine steel pipes salvaged by Oceaneering, or a total of P2,226,620.00 in actual
damages representing the value of the latter’s lost cargo. Excluded from the computation are the
items which, on account of the dates of their procurement, could not have possibly been included in
the 29 November 1997 inventory prepared by Engr. Oracion.
PEOPLE OF THE PHILIPPINES v. ROBERTO LOPEZ y CABAL

Documentary evidence should be presented to substantiate a claim for loss of earning capacity.
Roberto Lopez (Lopez) was charged with the murder of Prudencio Melendres (Melendres).
During the trial, Melendres’ wife, Ma. Liberty Francisco Melendres (Liberty), testified as to the civil
liability of Lopez. Liberty presented receipts to show that she spent P33,000 for the burial and the
interment and P7,500 for the wake. She also presented a certification from Tanod Publishing, Inc.
(Tanod Publishing), Melendres’ employer, as to his monthly salary range, honoraria and
transportation allowance. She also sought to recover moral damages.
The Regional Trial Court (RTC) convicted Lopez of the crime charged and ordered Lopez to
pay the heirs of Melendres as follows: P50,000 as death indemnity, P50,000 as moral damages,
P40,000 as actual damages and P7,570 per month for six months as lost income. The Court of Appeals
(CA) affirmed the conviction but modified the award of monetary damages. It reduced the award of
actual damages from P40,000 to P33,000, the latter amount having been substantiated by receipts.
As to the loss of income, the CA noted that there was no accurate way to determine
Melendres’ earnings since the certification issued by Tanod Publishing did not reflect a fixed amount
but only a salary range. However, the CA held that the heirs of Melendres are still entitled to a
reasonable amount as a result of Melendres’ loss of earning capacity and deemed it proper to
increase the award from P45,420 to P200,000.
ISSUE:
Whether or not the award for loss of earning capacity should be modified.
RULING:
YES. The rule is that documentary evidence should be presented to substantiate a claim for
loss of earning capacity. In this case, Liberty presented a certification from Tanod Publishing which
showed that Melendres was a photo correspondent for Tanod Newspaper and that his monthly
salary ranges from P1,780 to P3,570 on per story basis. Liberty presented another certification
from Tanod Publishing which showed that Melendres received the total amount
of P24,990 representing payment of honoraria and transportation allowance from 1 January to 31
July 2006. The Court notes that the defense did not object when the prosecution presented these
documents before the trial court. The rule is that evidence not objected to is deemed admitted and
may be validly considered by the court in arriving at its judgment. It was also established that at the
time of his death, Melendres was 41 years old. Thus, Melendres’ net earning capacity can be derived
from two sources: (1) his monthly salary and (2) his honorarium and transportation allowance. Loss
of earning capacity is computed as follows: Net Earning Capacity = Life expectancy x Gross Annual
Income Living Expenses. Thus, the Court ordered Lopez to pay the heirs of Melendres in the modified
award of P974,220 for loss of earning capacity.
BENJAMIN BELTRAN, JR., et al. v. COURT OF APPEALS AND THE PEOPLE OF THE PHILIPPINES
The law does not require a definite degree of certainty when proving the amount of damages
claimed. It is necessary, however, to establish evidence to substantiate the claim. To justify an award for
actual damages, there must be competent proof of the actual amount of loss.
Vicente narrated that he has a farm in Sta. Elena, Bula, Camarines Sur. He knew Beltran, et al.
for about three years already as the farm that they were plowing is merely adjacent to his
farm. Vicente has two farmhouses on his farm, one of which is just near the farm of Beltran, et al.’s
father, Benjamin Beltran, Sr., while the other is located at the upper portion of his farm. In 1996,
Vicente purchased a five horsepower Yanmar engine from Yanmar Marketing in Pili, Camarines
Sur. The said engine was later on installed on his F-5 hand tractor that he acquired on 24 October
1997 from Reforsado Metal Works in Bagumbayan, Bula, Camarines Sur, for P17,000.00. The F-5
hand tractor powered by five horsepower Yanmar engine (hand tractor) valued at P29,000.00 is
being used in Vicente's farm in Sta. Elena, Bula, Camarines Sur. The same was stored outside Vicente's
farmhouse near Beltran, et al.’s father's farm.
On 20 January 1998 at about 6:30 p.m., more or less, Vicente arrived in Sta. Elena, Bula,
Camarines Sur, from his house in La Paz, Pili, Camarines Sur. Upon seeing him, his cousin, Lorencita
Nacario, immediately informed him that his hand tractor was stolen by three persons, namely:
Benjamin Beltran, Jr. and Virgilio Beltran, together with a certain Francisco Bravo. The said incident
happened at around 6:00 p.m. while Vicente was still in his house in La Paz, Pili, Camarines Sur. To
verify such information, Vicente directly went to his farmhouse, together with a certain Kagawad
Gomer Sierte, his farm helper Rafael and a certain Policarpio Tagle, Jr. Upon reaching his farmhouse,
Vicente confirmed that his hand tractor was, indeed, missing. As a result, Vicente reported the same
to the barangay and police authorities of Sta. Elena, Bula, Camarines Sur.
ISSUE:
Whether or not Vicente Ollanes is entitled for actual damages amounting to 29,000 pesos for
the stolen hand tractor.
RULING:
NO. Although the body of the hand tractor was subsequently recovered as stated in the Pre-
Trial Order and only the engine was taken by the petitioners and Francisco Bravo, it does not
necessarily follow that it was only theft of the engine of the hand tractor. The Court finds merit in
Beltran, et al.’s contention that the appellate court erred in affirming the award of actual damages,
representing the value of the stolen engine, in favor of the private complainant as the same has no
legal basis.
Article 2199 of the Civil Code provides that “except as provided by law or by stipulation, one
is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly
proved. Such compensation is referred to as actual or compensatory damages.”
Credence can be given only to claims which are duly supported by receipts. While Beltran, et
al. did not rebut the amount of P12,000.00 as the value of the engine lost, no receipt to prove such
claim has been adduced in evidence by the prosecution. In the testimony of the private complainant,
he merely stated when and where he bought the said engine but as regards its amount he did not
mention anything about it as the receipt therefor could no longer be located. Instead, the private
complainant merely stated that the whole hand tractor has a total amount of P29,000.00. He then
presented the receipt for the body of the hand tractor with a stated amount of PI 7,000.00. Thus, the
award of P12,000.00 as actual damages in favor of the private complainant is improper for lack of
any legal basis.
As regards the amount of the body of the hand tractor, though it was properly supported by
receipt, no actual damages can be awarded covering the value of the same since it was duly recovered
as stipulated by the parties during pre-trial, which was clearly stated in the Pre-Trial Order.
Attorney’s Fees
ALCATEL PHILIPPINES, INC. v. I.M. BONGAR &CO., INC. AND STRONGHOLD INSURANCE, CO.,
INC.
G.R. No. 182946, October 5, 2011, THIRD DIVISION (Abad, J.)
The court should state the reason for the award of attorney’s fees in the body of the decision. Its
unheralded appearance in the dispositive portion is, as a rule, not allowed.
Philippine Long Distance Telephone Company (PLDT) engaged the services of Alcatel
Philippines, Inc. (Alcatel) to do the civil works needed for its Fast Track Project. To carry out these
works, Alcatel entered into a subcontract with I.M. Bongar and Co., Inc. (Bongar) for the construction
of needed manholes and conduits.Two of the requirements of their agreement were that Bongar was
to post 1) a performance bond equivalent to 25% of the total value of the subcontract and 2) an
advance payment bond guarantee. Complying with these requirements, Bongar and Stronghold
Insurance Co., Inc. (SIC) executed a Surety Bond and a Performance Bond, binding themselves jointly
and severally to pay Alcatel, in the event of Bongar’s failure to perform its obligations under its
contract. In the course of periodic inspection of the progress of the works, however, Alcatel noted
that Bongar had fallen behind schedule. Alcatel also received reports of inferior work. As it turned
out, Bongar failed to finish the required works. Bongar altogether stopped further construction
activities, forcing Alcatel to take over the works. Alcatel cancelled Bongar’s contract, demanded that
it vacate and turn over possession of the construction area, and hand over all uninstalled Alcatel-
supplied materials. Since Bongar ignored the letter, Alcatel sent it another one, this time with notice
to SIC, demanding payment of their liabilities under their bonds. Both Bongar and SIC refused to
comply, thus prompting Alcatel to file an action for damages.
The Regional Trial Court (RTC) ordered Bongar and SIC to pay Alcatel, jointly and severally,
the value of the uninstalled materials and attorney’s fees and costs. But the RTC denied for lack of
evidence Alcatel’s claims for overpayment and additional costs spent for completing the subject
works. The Court of Appeals affirmed the RTC Decision but deleted the award of attorney’s fees and
costs for the reason that, while these are stated in the dispositive portion, they are not mentioned in
the body of the decision.
ISSUE:
Whether or not Alcatel is entitled to attorney’s fees.
RULING:
YES. Although attorney’s fees are not allowed in the absence of stipulation, the court can
award the same when the defendant’s act or omission has compelled the plaintiff to incur expenses
to protect his interest or where the defendant acted in gross and evident bad faith in refusing to
satisfy the plaintiff's plainly valid, just, and demandable claim. Still, the award of attorney’s fees to
the winning party lies within the discretion of the court, taking into account the circumstances of
each case. This means that such an award should have factual, legal, and equitable basis, not founded
on pure speculation and conjecture. Further, the court should state the reason for the award of
attorney’s fees in the body of the decision. Its unheralded appearance in the dispositive portion is, as
a rule, not allowed.
Here, however, although the RTC did not specifically discuss in the body of its decision its
basis for awarding attorney’s fees, its findings of fact clearly support such an award.
DEVELOPMENT BANK OF THE PHILIPPINES v. TRAVERSE DEVELOPMENT CORPORATION

AND CENTRAL SURETY AND INSURANCE COMPANY
G.R. No. 169293, October 5, 2011, FIRST DIVISION (Leonardo-De Castro, J.)
In the absence of stipulation, attorney’s fees may be recovered as actual or compensatory

damages under any of the circumstances provided for in Article 2208 of the Civil Code, and one of them
is when the defendant's act or omission has compelled the plaintiff to litigate with third persons or to
incur expenses to protect his interest.
The Development of the Philippines (DBP) granted a Real Estate Loan to Traverse
Development Corporation (Traverse) for the construction of its three-storey commercial building,
secured by a mortgage on the land on which the building was to be built. Among the conditions
imposed by DBP in the mortgage contract was Traverse’s acquisition of an insurance coverage for an
amount not less than the loan, to be endorsed in DBP’s favor. Traverse submitted to DBP three
policies in accordance with the insurance condition in the mortgage contract. FGU Insurance
Corporation (FGU) renewed Traverse’s Fire Insurance Policy for another year. However, as DBP had
already transferred the buildings insurance to Central Surety & Insurance Company (Central), for the
same terms, it returned the FGU Policy to Traverse. During the effectivity of the policy, a fire of
undetermined origin razed and gutted Traverses building. The following day, Traverse informed
Central of the mishap and requested it to immediately conduct the necessary inspection, evaluation,
and investigation. Traverse submitted to Central written proof of the loss sustained by its building,
together with its claim. Central proposed to settle Traverses claim on the basis of cost of repairs of
the affected parts of the building. Believing that this was highly inequitable and unreasonable,
Traverse denied such proposal. Having failed to arrive at a settlement, Traverse, on filed a
complaint before the RTC, against Central and DBP for payment of its claim and damages.
Traverse averred that it was obvious from the beginning that Central was unable or unwilling
to fulfill its liability under the policy. It alleged that due to the unjustifiable delay of Central to settle
its claims, it was prevented from receiving rentals for its building, its loan with DBP had increased
due to interest and penalties, and it had suffered actual damages. DBP denied that Traverse had no
knowledge of the transfer of its insurance to Central as evidenced by its payment of the premium,
documentary stamp tax, and other charges for the new insurance policy. DBP also claimed that it was
Traverse that transferred its insurance to Central to avoid delays in renewing its insurance. Central
argued that Traverse had no valid and sufficient cause of action because aside from violating material
conditions in its policy, DBP, as the endorsee of the policy, was the real party-in-interest. Central also
averred that Traverse had no one else to blame but itself for the ballooning interest of its loan and
lack of rentals since it insisted on an exaggerated, unjustified, and unreasonable claim, considering
that the building was not a total loss, as the building was only partially damaged. The Regional Trial
Court (RTC) ruled in favor of Traverse, and ordered DBP and Central to solidarily pay Traverse, and
same was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not DBP and Central should be solidarily liable for attorney’s fees.
RULING:
NO. In the absence of stipulation, attorney’s fees may be recovered as actual or compensatory
damages under any of the circumstances provided for in Article 2208 of the Civil Code, and one of
them is when the defendant's act or omission has compelled the plaintiff to litigate with third persons
or to incur expenses to protect his interest.
Even if it were true that DBP had a hand in the transfer of Traverse’s insurance coverage to
Central, such act is not sufficient to hold it solidarily liable with Central for the payment of attorney’s
fees and cost of litigation under the above provision of the Civil Code. Records show that during the
testimony of the former insurance examiner of DBP, she claimed that she had repeatedly reminded
Traverse’s President, of the impending expiration of Traverses insurance coverage with FGU. The
President, however replied that her son would not be able to attend to it as he was out of the country
at that time. Subsequently, Atty. Ruperto Zamora of Central called to draw up Traverses insurance
coverage. DBP only came to know that Traverse had already renewed its insurance policy with FGU,
after Central had already drawn up the policy. Thus, DBP could not be blamed for facilitating such
transfer in light of the previous delays in Traverse’s submission of its insurance policy. It is worthy
to note that the policy was drawn on the date that Traverse’s previous FGU policy was set to
expire. Moreover, Central was not only one of DBPs accredited insurance companies, but it also had
a local branch office, which made transactions with it faster and easier. The Court also cannot sustain
the insinuation that DBP’s lax attitude in pursuing its claim against Central was tantamount to bad
faith as to make it liable for attorney’s fees and costs of suit. Even a resort to the principle of equity
will not justify making DBP liable.
Moral Damages
PEOPLE OF THE PHILIPPINES v. HEMIANO DE JESUS and RODELO MORALES
G.R. No. 186528, 26 January 2011, FIRST DIVISION (Velasco, Jr., J)
Moral damages must also be awarded because they are mandatory in cases of murder and
homicide, without need of allegation and proof other than the death of the victim.
Armando Arasula, Hermiano de Jesus and Rodelo Morales had been drinking at the birthday
party of a certain Alejandro Hornillo. Arasula left earlier. After a few minutes, Santiago Arasula, the
brother of the victim, heard Armando shout. They soon found him lying on the ground with De Jesus
and Morales still stabbing him.
Morales denied killing Armando. De Jesus on the other hand, admitted having killed the
victim, but raised the justifying circumstance of self-defense. The Regional Trial Court rendered a
decision finding Morales and De Jesus guilty of murder. The Court of Appeals found the testimony of
Santiago Arasula to be more credible and convincing, and thus upheld the RTC decision.
ISSUES:
1. Whether or not De Jesus and Morales are guilty of murder.

2. Whether or not damages should be awarded.
RULING:
1. YES. The RTC gave more weight to the testimony of Santiago Arasula. Santiago testified in
a candid and straightforward manner, and the cross-examination conducted by the defense failed to
shake him. In the absence of evidence showing any reason or motive for the prosecution witness to
perjure himself or herself, there is no reason to deviate from the RTC’s appreciation of said testimony
and the conclusions drawn from it. As De Jesus claims that the killing was done in self-defense, the
burden is thus on him to prove unlawful aggression on the part of the victim, as well as the other
elements of the justifying circumstance of self-defense. Even if events had transpired as De Jesus
related, he still failed to show that there was unlawful aggression on the part of the victim, or the
other elements of the justifying circumstance of self-defense.
2. YES. Moral damages must also be awarded because they are mandatory in cases of murder
and homicide, without need of allegation and proof other than the death of the victim. Moral damages
in the present case should be increased to PhP 75,000, in accordance with current jurisprudence. The
CA also correctly awarded temperate damage considering that Santiago was unable to prove the
actual expenses incurred by the death of his brother. Art. 2224 of the Civil Code provides that
temperate or moderate damages, which are more than nominal but less than compensatory damages,
may be recovered when the court finds that some pecuniary loss has been suffered but its amount
can not, from the nature of the case, be proved with certainty. Exemplary damages are also proper,
as the crime was attended by the aggravating circumstance of taking advantage of superior
strength. Under Art. 2230 of the Civil Code, exemplary damages as a part of the civil liability may be
imposed when the crime was committed with one or more aggravating circumstances.
IMMACULATE CONCEPTION ACADEMY and the late DR. PAULO C. CAMPOS substituted by his
heirs, DR. JOSE PAULO E. CAMPOS ATTY. PAULO E. CAMPOS, JR. and DR. ENRIQUE E. CAMPOS
v. AMA COMPUTER COLLEGE INCORPORATED
G.R. No. 173575, 02 February 2011, SECOND DIVISION (Abad, J.)
To be entitled to moral damages, a juridical person needs to prove that it had a good reputation
and that such reputation has been besmirched.
Immaculate Conception Academy (ICA) owned a three-storey building in Dasmarias, Cavite.

AMA Computer College, Inc. (AMA) ettled on leasing the property. The parties signed a contract of
lease for 10 years. During an inspection, AMA’s Chief Operating Officer for its Cavite Campus noted
several cracks on the floor and walls of the building’s second storey. This prompted more inspections.
AMA then wrote ICA demanding the return of all that it paid within 24 hours from notice. AMA cited
the building’s structural deficiency, which it regarded as a violation of ICA’s implied warranty against
hidden defects. When its request for reimbursement remained unheeded, AMA filed an action for
breach of contract and damages with prayer for the issuance of a writ of preliminary attachment
against ICA before the Regional Trial Court (RTC). ICA then claimed for damages against AMA.
ISSUE:
Whether or not ICA is entitled to its claim for damages.
RULING:
NO. To be entitled to moral damages, ICA needed to prove that it had a good reputation and
that AMA’s action besmirched the same. Such proof is wanting in this case. Since AMA acted in a
reckless, wanton, oppressive, and malevolent manner in imputing fraud and deceit on ICA, the Court
finds ground for awarding it exemplary damages. Further, the Court holds that, having been
compelled to litigate in order to protect their interests, ICA is also entitled to attorneys fees.
AMA was not justified in rescinding the contract of lease on account of ICA’s alleged
fraudulent representation regarding the true condition of its building. The fact is that AMA’s
representatives inspected the building to determine if it was suitable for their schools needs. The
cracks on the floor and on the walls were too obvious to suggest to them that something was amiss.
It was their fault that they did not check the significance of such signs. AMA’s outright rescission of
the lease contract and demand that ICA return the deposit and advance rentals it got within 24 hours
from such demand precluded ICA, first, from contesting the findings of the local building official or
getting some structural specialists to verify such findings or, second, from making the required
repair.
RODOLFO N. REGALA v. FEDERICO P. CARIN

Moral damages are not meant to be punitive but are designed to compensate and alleviate the
physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar harm unjustly caused to a person.
Rodolfo Regala (Regala) and Federico Carin (Carin) are adjacent neighbors at Spirig Street,
BF Resort Village, Las Pinas City. When Regala decided to renovate his one storey residence by
constructing a second floor, he under the guise of merely building an extension to his residence,
approached Carin sometime in May 1998 for permission to bore a hole through a perimeter wall
shared by both their respective properties, to which Carin verbally consented on the condition that
Regala would clean the area affected by the work.
In the course of the construction of the second floor, Carin and his wife Marietta suffered from
the dust and dirt which fell on their property. As Regala failed to address the problem to Carins
satisfaction, Carin filed a letter-complaint with the Office of the City Engineer and Building Official of
Las Piñas City on June 9, 1998. However, Regala still continued the work despite several notices from
the City Engineers Office.
Carin then filed a complaint for damages before the Regional Trial Court (RTC) alleging that
instead of boring just one hole as agreed upon, Regala demolished the whole length of the wall and
that debris and dust piled up on his property. Carin thus prayed for the award of moral and exemplary
damages. Regala answered that he was the sole and exclusive owner of the wall referred to as a
perimeter wall and that securing the consent was a mere formality to facilitate the issuance of a
building permit. RTC rendered judgment in favor of Carin. The Court of Appeals (CA) affirmed the
trial court’s decision with modification by reducing the award of moral and exemplary damages to
P50,000 and P25,000, respectively. Hence, Regala’s present petition faulting the appellate court in
affirming with modification the decision of the trial court considering the absence of any competent
proof to warrant the grant of moral and exemplary damages as well as attorney’s fees.
ISSUE:
Whether or not the petition should be granted merit.
RULING:
YES. The petition is partly impressed with merit. The trial court’s award of moral and
exemplary damages, as affirmed by the appellate court, was premised on the damage and suffering
sustained by Carin arising from quasi-delict under Article 2176 of the Civil Code.
In prayers for moral damages, however, recovery is more an exception rather than the rule.
Moral damages are not meant to be punitive but are designed to compensate and alleviate the
physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar harm unjustly caused to a person. To be entitled to such
an award, the claimant must satisfactorily prove that he has suffered damages and that the injury
causing it has sprung from any of the cases listed in Articles 2219 and 2220 of the Civil Code.
Moreover, the damages must be shown to be the proximate result of a wrongful act or omission. The
claimant must thus establish the factual basis of the damages and its causal tie with the acts of the
defendant.
In the present case, Carin failed to establish by clear and convincing evidence that the injuries
he sustained were the proximate effect of Regala’s act or omission. It bears noting that Regala was
engaged in the lawful exercise of his property rights to introduce renovations to his abode. While he
initially did not have a building permit and may have misrepresented his real intent when he initially
sought Carin’s consent, the lack of the permit was inconsequential since it only rendered Regala liable
to administrative sanctions or penalties. Necessarily, the Court is not inclined to award exemplary
damages.
Regala, however, cannot steer clear from any liability whatsoever. Carin and his family’s
rights to the peaceful enjoyment of their property have, at the very least, been inconvenienced from
the incident borne of Regala’s construction work. Any pecuniary loss or damage suffered by Carin
cannot be established as the records are bereft of any factual evidence to establish the same. Nominal
damages may thus be adjudicated in order that a right of the plaintiff, Carin herein, which has been
violated or invaded by the defendant, Regala herein, may be vindicated or recognized, and not for the
purpose of indemnifying the plaintiff for any loss suffered by him.
TAXATION LAW
INCOME TAXATION
COMMISSIONER OF INTERNAL REVENUE v. FILINVEST DEVELOPMENT CORPORATION

G. R. No. 163653/167689, 19 July 2011, EN BANC (Perez, J.)
It is evident from the categorical language of Section 34(c)(2) of the 1993 NIRC which provides
that gain or loss will not be recognized in case the exchange of property for stocks results in the control
of the transferee by the transferor, alone or with other transferors not exceeding four persons.
The owner of 80% of the outstanding shares of respondent Filinvest Alabang, Inc. (FAI),
respondent Filinvest Development Corporation (FDC) is a holding company which also owned
67.42% of the outstanding shares of Filinvest Land, Inc. (FLI). FDC and FAI entered into a Deed of
Exchange with FLI whereby the former both transferred in favor of the latter parcels of land
appraised at P4,306,777,000.00. In exchange for said parcels, 463,094,301 shares of stock of FLI were
issued to FDC and FAI.
FLI requested a ruling from the Bureau of Internal Revenue (BIR) to the effect that no gain or
loss should be recognized in the aforesaid transfer of real properties. Acting on the request, the BIR
issued Ruling No. S-34-046-97 dated 3 February 1997, finding that the exchange is among those
contemplated under Section 34 (c) (2) of the old National Internal Revenue Code (NIRC) which
provides that (n)o gain or loss shall be recognized if property is transferred to a corporation by a
person in exchange for a stock in such corporation of which as a result of such exchange said person,
alone or together with others, not exceeding four (4) persons, gains control of said corporation." With
the BIR’s reiteration of the foregoing ruling upon the 10 February 1997 request for clarification filed
by FLI, the latter, together with FDC and FAI, complied with all the requirements imposed in the
ruling.
On various dates during the years 1996 and 1997, FDC also extended advances in favor of its
affiliates, namely, FAI, FLI, Davao Sugar Central Corporation (DSCC) and Filinvest Capital, Inc. (FCI).
FDC also entered into a Shareholders Agreement with Reco Herrera PTE Ltd. (RHPL) for the
formation of a Singapore-based joint venture company called Filinvest Asia Corporation (FAC),
tasked to develop and manage FDCs 50% ownership of its PBCom Office Tower Project (the Project).
With their equity participation in FAC respectively pegged at 60% and 40% in the Shareholders
Agreement, FDC subscribed to P500.7 million worth of shares in said joint venture company to RHPLs
subscription worth P433.8 million. Having paid its subscription by executing a Deed of Assignment
transferring to FAC a portion of its rights and interest in the Project worth P500.7 million, FDC
eventually reported a net loss of P190,695,061.00 in its Annual Income Tax Return for the taxable
year 1996.
FDC received from the BIR a Formal Notice of Demand to pay deficiency income and
documentary stamp taxes, plus interests and compromise penalties,
ISSUE:
Whether or not the exchange of shares of stock for property among FDC, FAI and FLI met all
the requirements for the non-recognition of the table gain under Section 40(C)(2) (c) of the NIRC
RULING:
YES. It is evident from the categorical language of Section 34(c)(2) of the 1993 NIRC which
provides that gain or loss will not be recognized in case the exchange of property for stocks results
in the control of the transferee by the transferor, alone or with other transferors not exceeding four
persons. Rather than isolating the same as proposed by the CIR, FDC's 2,579,575,000 shares or
61.03% control of FLI's 4,226,629,000 outstanding shares should, therefore, be appreciated in
combination with the 420,877,000 new shares issued to FAI which represents 9.96% control of said
transferee corporation. Together FDC's 2,579,575,000 shares (61.03%) and FAI's 420,877,000
shares (9.96%) clearly add up to 3,000,452,000 shares or 70.99% of FLI's 4,226,629,000 shares.
Since the term "control" is clearly defined as "ownership of stocks in a corporation possessing at least
fifty-one percent of the total voting power of classes of stocks entitled to one vote" under Section 34
(c)(6)[c] of the 1993 NIRC, the exchange of property for stocks between FDC FAI and FLI clearly
qualify as a tax-free transaction under paragraph 34(c)(2) of the same provision.
Against the clear tenor of Section 34(c)(2) of the 1993 NIRC, the CIR cites then Supreme Court
Justice Jose Vitug and CTA Justice Ernesto D. Acosta who, in their book Tax Law and Jurisprudence,
opined that said provision could be inapplicable if control is already vested in the exchange or prior
to exchange. Aside from the fact that that the 10 September 2002 Decision in CTA Case No. 6182
upholding the tax-exempt status of the exchange between FDC, FAI and FLI was penned by no less
than Justice Acosta himself, FDC and FAI significantly point out that said authors have acknowledged
that the position taken by the BIR is to the effect that "the law would apply even when the exchangor
already has control of the corporation at the time of the exchange." This was confirmed when,
apprised in FLI's request for clarification about the change of percentage of ownership of its
outstanding capital stock, the BIR opined as follows:
Please be informed that regardless of the foregoing, the transferors, Filinvest Development
Corp. and Filinvest Alabang, Inc. still gained control of Filinvest Land, Inc. The term 'control' shall
mean ownership of stocks in a corporation by possessing at least 51% of the total voting power of all
classes of stocks entitled to vote. Control is determined by the amount of stocks received, i.e., total
subscribed, whether for property or for services by the transferor or transferors. In determining the
51% stock ownership, only those persons who transferred property for stocks in the same
transaction may be counted up to the maximum of five (BIR Ruling No. 547-93 dated December 29,
1993).
Refund or Tax Credit of Income Tax
BELLE CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

Section 69 of the old National Internal Revenue Code (NIRC) allows unutilized tax credits to be
refunded as long as the claim is filed within the prescriptive period. This, however, no longer holds true
under Section 76 of the 1997 NIRC as the option to carry-over excess income tax payments to the
succeeding taxable year is now irrevocable.
To repeat, under the new law, once the option to carry-over excess income tax payments to the
succeeding years has been made, it becomes irrevocable. Thus, applications for refund of the unutilized
excess income tax payments may no longer be allowed.
Petitioner Belle Corporation (Belle) filed with the Bureau of Internal Revenue (BIR) its
Income Tax Return (ITR) for the first quarter of 1997. It paid through PCI Bank, an Authorized Agent
Bank of the BIR. On August 14, 1997, it filed its second quarter ITR, declaring an overpayment of
income taxes.
In view of the overpayment, no taxes were paid for the second and third quarters of 1997. Its
ITR for the taxable year ending December 31, 1997 thereby reflected an overpayment of income
taxes. Instead of claiming the amount as a tax refund, it decided to apply it as a tax credit to the
succeeding taxable year by marking the tax credit option box in its 1997 ITR.
For the taxable year 1998, its amended ITR showed an overpayment. On April 12, 2000, it
filed with the BIR an administrative claim for refund of its unutilized excess income tax payments for
the taxable year 1997. Notwithstanding the filing of the administrative claim for refund, petitioner
carried over its overpayment to the taxable year 1999 and applied a portion thereof to its
1999 Minimum Corporate Income Tax (MCIT) liability.
On April 14, 2000, due to the inaction of the respondent Commissioner of Internal Revenue
(CIR) and in order to toll the running of the two-year prescriptive period, petitioner appealed its
claim with the CTA via a Petition for Review.
On April 10, 2001, the CTA rendered a Decision denying petitioners claim for refund. Belle
sought reconsideration, but the same was denied thereby prompting Belle to elevate the matter to
the CA via a Petition for Review under Rule 43. The CA denied the petition. The CA explained that the
overpayment for taxable year 1997 can no longer be carried over to taxable year 1999 because excess
income payments can only be credited against the income tax liabilities of the succeeding taxable
year, in this case up to 1998 only and not beyond. Neither can the overpayment be refunded as the
remedies of automatic tax crediting and tax refund are alternative remedies. Belle moved for
reconsideration. The CA, however, denied the same.
ISSUE:
Whether or not Belle is entitled to a refund of its excess income tax payments for the taxable
year 1997.
RULING:
NO. The law applicable is Section 76 of the NIRC.
Unutilized excess income tax payments may be refunded within two years from the date of
payment under Section 69 of the old NIRC. Under Section 69 of the old NIRC, in case of overpayment
of income taxes, a corporation may either file a claim for refund or carry-over the excess payments
to the succeeding taxable year. Availment of one remedy, however, precludes the other.
Although these remedies are mutually exclusive, we have in several cases allowed
corporations, which have previously availed of the tax credit option, to file a claim for refund of their
unutilized excess income tax payments. Thus, under Section 69 of the old NIRC, unutilized tax credits
may be refunded as long as the claim is filed within the two-year prescriptive period.
This rule, however, no longer applies. The option to carry over excess income tax payments is
irrevocable under Section 76 of the 1997 NIRC. Under the new law, in case of overpayment of income
taxes, the remedies are still the same; and the availment of one remedy still precludes the other. But
unlike Section 69 of the old NIRC, the carry-over of excess income tax payments is no longer limited
to the succeeding taxable year. Unutilized excess income tax payments may now be carried over to
the succeeding taxable years until fully utilized. In addition, the option to carry-over excess income
tax payments is now irrevocable. Hence, unutilized excess income tax payments may no longer be
refunded.
Accordingly, since petitioner already carried over its 1997 excess income tax payments to the
succeeding taxable year 1998, it may no longer file a claim for refund of unutilized tax credits for
taxable year 1997.
BELLE CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

It is hereby clarified that although Belle Corporation may no longer file a claim for refund, it
may, however, apply the excess income tax payments for the taxable year 1997 as a tax credit to the
succeeding taxable years until fully utilized.
For Resolution is the Motion for Clarification filed by Belle Corporation. In the Motion, Belle
Corp. prays that the Decision dated January 10, 2011 be modified or clarified to indicate Belle Corp.’s
entitlement to a tax credit of unutilized excess income tax payments for the taxable year 1997.
In such case, Belle Corporation (Belle Corp.) is a domestic corporation engaged in the real
estate and property business. Belle Corp. filed with the Bureau of Internal Revenue (BIR) its Income
Tax Return (ITR) for the first quarter of 1997, showing a gross income of P741,607,495.00, a
deduction of P65,381,054.00, a net taxable income of P676,226,441.00 and an income tax due of
P236,679,254.00, which Belle Corp. paid on even date through PCI Bank, an Authorized Agent Bank
of the BIR. Belle Corp. filed with the BIR its second quarter ITR, declaring an overpayment of income
taxes in the amount of P66,634,290.00. In view of the overpayment, no taxes were paid for the
second and third quarters of 1997. Belle Corp.’s ITR for the taxable year ending December 31, 1997
thereby reflected an overpayment of income taxes in the amount of P132,043,528.00. Instead of
claiming the amount as a tax refund, Belle Corp. decided to apply it as a tax credit to the succeeding
taxable year by marking the tax credit option box in its 1997 ITR. For the taxable year 1998, Belle
Corp.'s amended ITR showed an overpayment of P106,447,318.00. Belle Corp. filed with the BIR an
administrative claim for refund of its unutilized excess income tax payments for the taxable year
1997. Notwithstanding the filing of the administrative claim for refund, Belle Corp. carried over the
amount of P106,447,318.00 to the taxable year 1999 and applied a portion thereof to its 1999
Minimum Corporate Income Tax (MCIT) liability. Due to the inaction of the Commissioner of Internal
Revenue (CIR) and in order to toll the running of the two-year prescriptive period, Belle Corp.
appealed its claim for refund of unutilized excess income tax payments for the taxable year 1997 with
the Court of Tax Appeals (CTA). CTA denied Belle Corp’s claim for refund. Upon appeal, the Court of
Appeals denied the petition of Belle Corp.
ISSUE:
Whether or not Belle Corp. properly carried over its 1997 excess income tax payments.
RULING:
YES. In the previous Decision, the Court held that Section 76 of the 1997 National Internal
Revenue Code (NIRC) and not Section 69 of the old NIRC applies. Section 76 provides that a taxpayer
has the option to file a claim for refund or to carry-over its excess income tax payments. The option
to carry-over, however, is irrevocable. Thus, once a taxpayer opted to carry-over its excess income
tax payments, it can no longer seek refund of the unutilized excess income tax payments. The
taxpayer, however, may apply the unutilized excess income tax payments as a tax credit to the
succeeding taxable years until such has been fully applied pursuant to Section 76 of the NIRC.
In the said Decision, the Court denied petitioner’s claim for refund because it has earlier opted
to carry over its 1997 excess income tax payments by marking the tax credit option box in its 1997
income tax return. The Court must clarify, however, that while Belle Corp. may no longer file a claim
for refund, it properly carried over its 1997 excess income tax payments by applying portions thereof
to its 1998 and 1999 Minimum Corporate Income Tax in the amounts of P25,596,210.00 and
P14,185,874.00, respectively. Pursuant to that ruling, Belle Corp. may apply the unutilized excess
income tax payments as a tax credit to the succeeding taxable years until fully utilized. Thus, as of the
taxable year 1999, petitioner still has an unutilized excess income tax payments of P92,261,444.00
which may be carried over to the succeeding taxable years until fully utilized.
MERCURY DRUG CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

Section 4(a) of RA No. 7432 specifically allows the 20% senior citizens’ discount to be claimed
by the private establishment as a tax credit and not merely as a tax deduction from gross sales or gross
income. The tax credit should be equivalent to the actual 20% sales discount granted to qualified senior
citizens.
Mercury Drug Corporation (Mercury Drug) sought for the refund of the 20% sales discount it
extended to qualified senior citizens under Republic Act (RA) No. 7432. When the Commissioner of
Internal Revenue (CIR) failed to act upon its claim, Mercury Drug filed a petition for review with the
Court of Tax Appeals (CTA). The CTA favored Mercury Drug by declaring that the 20% sales discount
should be treated as tax credit rather than a mere deduction from gross income. The CTA, however,
stated that the claim for tax credit must be based on the actual cost of the medicine and not the whole
amount of the 20% senior citizens discount. The Court of Appeals (CA) sustained the CTA and
interpreted the term “cost” as used in Section 4(a) of RA No. 7432 to mean the acquisition cost of the
medicines sold to senior citizens. Mercury Drug contended that the actual discount granted to the
senior citizens, rather than the acquisition cost of the item availed by senior citizens, should be the
basis for computation of tax credit.
ISSUE:
Whether or not the claim for tax credit should be based on the full amount of the 20%
discount extended to senior citizens.
RULING:
YES. Section 4(a) of RA No. 7432 specifically allows the 20% senior citizens’ discount to be
claimed by the private establishment as a tax credit and not merely as a tax deduction from gross
sales or gross income. The law however is silent as to how the cost of the discount as tax credit should
be construed.
In Bicolandia, the Court construed the term “cost” as referring to the amount of the 20%
discount extended by a private establishment to senior citizens in their purchase of medicines. The
Court finally affirmed in M.E. Holding that the tax credit should be equivalent to the actual 20% sales
discount granted to qualified senior citizens. It is worthy to mention that RA No. 7432 had undergone
two (2) amendments; first in 2003 by RA No. 9257 and most recently in 2010 by RA No. 9994. The
20% sales discount granted by establishments to qualified senior citizens is now treated as tax
deduction and not as tax credit. As the Court has likewise declared in Commissioner of Internal
Revenue v. Central Luzon Drug Corporation, this case covers the taxable years 1993 and 1994, thus,
Republic Act No. 7432 applies.
Based on the foregoing, the Court sustains Mercury Drug’s argument that the cost of discount
should be computed on the actual amount of the discount extended to senior citizens. However, the
Court gives full accord to the factual findings of the Court of Tax Appeals with respect to the actual
amount of the 20% sales discount, i.e., the sum of P3,522,123.25 for the year 1993
and P34,211,769.45 for the year 1994. Therefore, Mercury Drug is entitled to a tax credit equivalent
to the actual amounts of the 20% sales discount as determined by the Court of Tax Appeals.
VALUE-ADDED TAX
RENATO V. DIAZ and AURORA MA. F. TIMBOL v. THE SECRETARY OF FINANCE AND THE
COMMISSION OF INTERNAL REVENUE
G.R. No. 193007, 19 JULY 2011, EN BANC (Abad, J.)
The law imposes VAT on all kinds of services rendered in the Philippines for a fee, including those
specified in the list. The enumeration of affected services is not exclusive. By qualifying services with the
words all kinds, Congress has given the term services an all-encompassing meaning.
Petitioners Renato V. Diaz and Aurora Ma. F. Timbol (petitioners) filed this petition for
declaratory relief assailing the validity of the impending imposition of value-added tax (VAT) by the
Bureau of Internal Revenue (BIR) on the collections of tollway operators.
Petitioners hold the view that Congress did not, when it enacted the NIRC, intend to include
toll fees within the meaning of sale of services that are subject to VAT; that a toll fee is a users tax, not
a sale of services; that to impose VAT on toll fees would amount to a tax on public service; and that,
since VAT was never factored into the formula for computing toll fees, its imposition would violate
the non-impairment clause of the constitution.
The government avers that the NIRC imposes VAT on all kinds of services of franchise
grantees, including tollway operations, except where the law provides otherwise; that the Court
should seek the meaning and intent of the law from the words used in the statute; and that the
imposition of VAT on tollway operations has been the subject as early as 2003 of several BIR rulings
and circulars.
ISSUE:
Whether or not toll fees collected by tollway operators may subjected to value- added tax.
RULING:
YES. The law imposes VAT on all kinds of services rendered in the Philippines for a fee,
including those specified in the list. The enumeration of affected services is not exclusive. By
qualifying services with the words all kinds, Congress has given the term services an all-
encompassing meaning. The listing of specific services are intended to illustrate how pervasive and
broad is the VATs reach rather than establish concrete limits to its application. Thus, every activity
that can be imagined as a form of service rendered for a fee should be deemed included unless some
provision of law especially excludes it.
Presidential Decree (P.D.) 1112 or the Toll Operation Decree establishes the legal basis for
the services that tollway operators render. Essentially, tollway operators construct, maintain, and
operate expressways, also called tollways, at the operators’ expense. Tollways serve as alternatives
to regular public highways that meander through populated areas and branch out to local roads.
Traffic in the regular public highways is for this reason slow-moving. In consideration for
constructing tollways at their expense, the operators are allowed to collect government-approved
fees from motorists using the tollways until such operators could fully recover their expenses and
earn reasonable returns from their investments.
When a tollway operator takes a toll fee from a motorist, the fee is in effect for the latter’s use
of the tollway facilities over which the operator enjoys private proprietary rights that its contract
and the law recognize. In this sense, the tollway operator is no different from the following service
providers under Section 108 of the NIRC who allow others to use their properties or facilities for a
fee.
It does not help petitioners’ cause that Section 108 subjects to VAT all kinds of services
rendered for a fee regardless of whether or not the performance thereof calls for the exercise or use
of the physical or mental faculties. This means that services to be subject to VAT need not fall under
the traditional concept of services, the personal or professional kinds that require the use of human
knowledge and skills.
Furthermore, tollway operators not only come under the broad term all kinds of services,
they also come under the specific class described in Section 108 as all other franchise grantees who
are subject to VAT, except those under Section 119 of this Code.
LVM CONSTRUCTION CORPORATION, REPRESENTED BY ANDRES CHUA LAO v. F.T.

SANCHEZ/SOCOR/KIMWA (JOINT VENTURE), F.T. SANCHEZ CONSTRUCTION CORPORATION,
SOCOR CONSTRUCTION CORPORATION AND KIMWA CONSTRUCTION AND DEVELOPMENT
CORPORATION ALL REPRESENTED BY FORTUNATO O. SANCHEZ, JR.
G.R. No. 181961, 5 December 2011, SECOND DIVISION (Perez, J.)
Courts cannot supply material stipulations, read into the contract words it does not contain or,
for that matter, read into it any other intention that would contradict its plain import.
LVM Construction Corporation (LVM) is a duly licensed construction firm primarily engaged
in the construction of roads and bridges for the Department of Public Works and Highways (DPWH).
LVM as the contractor entered into a Subcontractor Agreement with the Joint Venture composed of
respondents as sub-contractor. The Subcontract Agreement executed by the parties provided that:
3) Payment to the SUBCONTRACTOR shall be on item of work accomplished in the subcontracted
portion of the project at awarded unit cost of the project less NINE PERCENT (9%). The
SUBCONTRACTOR shall issue a BIR registered receipt to the CONTRACTOR. 4) Ten percent (10%)
retention to be deducted for every billing of sub-contractor as prescribed under the Tender
Documents. 13) The payment to the SUBCONTRACTOR shall be made within seven (7) days after the
check issued by DPWH to CONTRACTOR has already been made good.
For work rendered in the premises, the Joint Venture sent LVM a total of 27 Billings. LVM paid
the Joint Venture a partial sum claiming that it had not yet been fully paid by the DPWH. Having
completed the sub-contracted works, the Joint Venture subsequently demanded from LVM the
settlement of its unpaid claims as well as the release of money retained by the latter in accordance
with the Sub-Contract Agreement. In a letter, LVM explained to Joint Venture the fact that its auditors
have belatedly discovered that no deductions for E-VAT had been made from its payments on Billing
Nos. 1 to 26 and that it was, as a consequence, going to deduct the 8.5% payments for said tax from
the amount still due in the premises. The Joint Venture claimed that, having issued Official Receipts
for every payment it received, it was liable to pay 10% VAT thereon and that LVM can, in turn, claim
therefrom an equivalent input tax of 10%.
With its claims still unpaid despite the lapse of more than four (4) years from the completion
of the sub-contracted works, the Joint Venture, thru its Managing Director, Fortunato O. Sanchez, Jr.,
filed against LVM the 30 June 2005 complaint for sum of money and damages which was docketed
before the Construction Industry Arbitration Commission (CIAC). LVM Answer with Compulsory
Counterclaim, maintained that it did not release the 10% retention for Billing Nos. 1 to 26 on the
ground that it had yet to make the corresponding 8.5% deductions for E-VAT which the Joint Venture
should have paid to the Bureau of Internal Revenue (BIR).
The CIAC rendered its decision granting the Joint Venture’s claims for the payment of the
retention money for Billing Nos. 1 to 26 as well as the interest thereon and the unpaid balance billing
from 6 August 1999 to 1 January 2006 in the aggregate sum of P11,307,646.68. Discounting the
contractual and legal bases for LVM’s claim that it had the right to offset its E-VAT payments from the
retention money still in its possession, the CIAC ruled that the VAT deductions the DPWH made from
its payments to LVM were for the whole project and already included all its supplies and
subcontractors.
The CIAC’s decision was likewise affirmed in toto by the CA.
ISSUE:
Whether or not the CA erred when it ruled that respondents are deemed to have already paid
value added tax merely because respondents had allegedly issued receipts for services rendered.
RULING:
NO. A contract constitutes the law between the parties who are, therefore, bound by its
stipulations which, when couched in clear and plain language, should be applied according to their
literal tenor.
Courts are obliged to give effect to the parties’ agreement and enforce the contract to the
letter. This is particularly true in this case where, in addition to the dearth of a meeting of minds
between the parties, their contemporaneous and subsequent acts fail to yield any intention to offset
the said E-VAT payments from the retention money still in LVM’s possession.
In the absence of any stipulation regarding the Joint Venture’s sharing in the VAT deducted
and withheld by the DPWH from its payment on the main contract, the CIAC and the CA correctly
ruled that LVM has no basis in offsetting the amounts of said tax from the retention still in its
possession. To recapitulate, LVM, as Contractor for the Project, was liable for the 8.5% VAT which
was withheld by the DPWH from its payments, pursuant to Section 114 (C) of the NIRC. Absent any
agreement to that effect, LVM cannot deduct the amounts thus withheld from the sums it still owed
the Joint Venture which, as Subcontractor of 30% of the Project, had its own liability for 10% VAT
insofar as the sums paid for the sub-contracted works were concerned. Although the burden to pay
an indirect tax like VAT can, admittedly, be passed on to the purchaser of the goods or services, it
bears emphasizing that the liability to pay the same remains with the manufacturer or seller like LVM
and the Joint Venture. In the same manner that LVM is liable for the VAT due on the payments made
by the DPWH pursuant to the contract on the Project, the Joint Venture is, consequently, liable for the
VAT due on the payments made by LVM pursuant to the parties Sub-Contract.
Refund or Tax Credit of Value-Added Tax
SILICON PHILIPPINES, INC. v. COMMISSIONER OF INTERNAL REVENUE

The non-presentation of the ATP and the failure to indicate the word "zero-rated" in the invoices
or receipts are fatal to a claim for credit/refund of input VAT on zero-rated sales.
Silicon Philippines, Inc., a domestic corporation and a registered Value Added Tax (VAT)
taxpayer, filed with Commissioner of Internal Revenue (CIR) an application for credit/refund of
unutilized input VAT for the period October 1, 1998 to December 31, 1998. Due to the inaction of the
CIR, Silicon filed a Petition for Review with the CTA Division alleging that for the 4th quarter of 1998,
it generated and recorded zero-rated export sales in the amount of P3,027,880,818.42, paid to the
same with the CIR and that for the said period, Silicon paid input VAT in the total amount
of P31,902,507.50, which have not been applied to any output VAT.
The CTA Division partially granted Silicon’s petition for refund of unutilized input VAT on
capital goods. CTA Division ruled that Silicon is not entitled to refund any input VAT attributable to
its zero-rated export sales since Silicon failed to present an Authority to Print (ATP) from the BIR
neither did it print on its export sales invoices the ATP and the word "zero-rated. Both parties moved
for reconsideration however both motions were denied. Silicon then appealed with the CTA En Banc.
The CTA En Banc denied the petition for lack of merit. The CTA En Banc reiterates the requirement
of [printing] the BIR permit to print on the face of the sales invoices and official receipts. Silicon
moved for reconsideration but the same was also denied.
ISSUE:
Whether or not Silicon is entitled to refund the input VAT attributable to its zero-rated sales.
RULING:
NO. In a claim for credit/refund of input VAT attributable to zero-rated sales, Section 112 (A)
of the NIRC lays down four requisites, among others, that the taxpayer must be engaged in sales
which are zero-rated or effectively zero-rated. To prove this, duly registered invoices or receipts
evidencing zero-rated sales must be presented. However, since the ATP is not indicated in the
invoices or receipts, the only way to verify whether the invoices or receipts are duly registered is by
requiring the claimant to present its ATP from the BIR. Without this proof, the invoices or receipts
would have no probative value for the purpose of refund.
Silicon failed to show that it has an ATP from the BIR and to indicate the ATP and the word
"zero-rated" in its export sales invoices. ATP need not be reflected or indicated in the invoices or
receipts because there is no law or regulation requiring it. But while there is no law requiring the
ATP to be printed on the invoices or receipts, Section 238 of the NIRC expressly requires persons
engaged in business to secure an ATP from the BIR prior to printing invoices or receipts.
Failure to print the word "zero-rated" on the sales invoices is fatal to a claim for refund of
input VAT. Similarly, failure to print the word "zero-rated" on the sales invoices or receipts is fatal to
a claim for credit/refund of input VAT on zero-rated sales. The compliance with Section 4.108-1 of
RR 7-95, requiring the printing of the word "zero rated" on the invoice covering zero-rated sales, is
essential as this regulation proceeds from the rule-making authority of the Secretary of Finance
under Section 244 of the NIRC.
MICROSOFT PHILIPPINES, INC v. COMMISSIONER OF INTERNAL REVENUE

An invoice, lacking the word “zero-rated” is not a VAT invoice and thus cannot give rise to any
input tax.
In December 2002, Microsoft filed an administrative claim for tax credit of Value Added Tax
(VAT) input taxes with the Bureau of Internal Revenue (BIR) for the year 2001. Due to the BIR's
inaction, Microsoft filed a petition for review with the Court of Tax Appeals (CTA) claiming that it is
entitled to a refund of unutilized input VAT attributable to its zero-rated sales. The CTA denied the
claim for tax credit of VAT input taxes, ruling that Microsoft failed to comply with the invoicing
requirements of National Internal Revenue Code (NIRC) and the corresponding Revenue Regulation.
It stated that Microsoft's official receipts do not bear the imprinted word “zero-rated” on its face,
thus, the official receipts cannot be considered as valid evidence to provide zero-rated sales for VAT
purposes.
ISSUE:
Whether or not Microsoft is entitled to a claim for a tax credit or refund of VAT input taxes
although the “zero-rated” is not imprinted on Microsoft's official receipts.
RULING:
NO. At the outset, a tax credit or refund, like tax exemption, is strictly construed against the
taxpayer. The taxpayer claiming the tax credit or refund has the burden of proving that he is entitled
to the refund or credit, in this case VAT input tax, by submitting evidence that he has complied with
the requirements laid down in the Tax Code and the BIR's Revenue Regulations under which such
privilege of credit or refund is accorded.
The invoicing requirements for a VAT-registered taxpayer as provided in the NIRC and
Revenue Regulations are clear. A VAT-registered taxpayer is required to comply with all the VAT
invoicing requirements to be able to file a claim for input taxes on domestic purchases for goods or
services attributable to zero-rated sales. A “VAT invoice” is an invoice that meets the requirements
of Section 4.108-1 of RR 7-95. Contrary to Microsoft's claim, RR 7-95 expressly states that “All
purchases covered by invoices other than a VAT invoice shall not give rise to any input tax.”
Microsoft's invoice, lacking the word zero-rated is not a VAT invoice and thus cannot give rise to any
input tax.
SOUTHERN PHILIPPINES POWER CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

G.R. No. 179632, 19 October 2011, THIRD DIVISION (Abad, J.)
The government should not use technicalities to hold on to money that does not belong to it.
Only a preponderance of evidence is needed to grant a claim for tax refund based on excess payment.
Southern Philippines Power Corporation (SPP), a power company that generates and sells
electricity to the National Power Corporation (NPC), applied with the Bureau of Internal Revenue
(BIR) for zero-rating of its transactions under Section 108(B)(3) of the National Internal Revenue
Code (NIRC). The BIR approved the application for taxable years 1999 and 2000. SPP filed a claim
with Commissioner of Internal Revenue (CIR) for a P5,083,371.57 tax credit or refund for 1999.
Thereafter, SPP filed a second claim of P6,221,078.44 in tax credit or refund for 2000. The amounts
represented unutilized input VAT attributable to SPP’s zero-rated sale of electricity to NPC. Before
the lapse of the two-year prescriptive period for such actions, SPP filed with the Court of Tax Appeals
(CTA) Second Division a petition for review covering its claims for refund or tax credit. The petition
claimed only the aggregate amount of P8,636,126.75 which covered the last two quarters of 1999
and the four quarters in 2000. CTA denied SPP’s claims, holding that its zero-rated official receipts
did not correspond to the quarterly VAT returns, bearing a difference of P800,107,956.61. Those
receipts only support the amount of P118,945,643.88. Further, these receipts do not bear the words
zero-rated in violation of RR 7-95. On appeal, the CTA En Banc affirmed the Second Divisions
decision.
ISSUE:
Whether or not that SPP’s sales invoices and receipts would be sufficient to prove its zero-
rated transactions.
RULING:
YES. While acknowledging that SPP’s sale of electricity to NPC is a zero-rated transaction, the
CTA En Banc ruled that SPP failed to establish that it made zero-rated sales. True, SPP submitted
official receipts and sales invoices stamped with the words BIR VAT Zero-Rate Application Number
419.2000 but the CTA En Banc held that these were not sufficient to prove the fact of sale. But NIRC
Section 110 (A.1) provides that the input tax subject of tax refund is to be evidenced by a VAT invoice
or official receipt issued in accordance with Section 113. The above does not distinguish between an
invoice and a receipt when used as evidence of a zero-rated transaction. Consequently, the CTA
should have accepted either or both of these documents as evidence of SPPs zero-rated transactions.
The Court held in Seaoil Petroleum Corporation v. Autocorp Group that business forms like
sales invoices are recognized in the commercial world as valid between the parties and serve as
memorials of their business transactions. And such documents have probative value. A claim for tax
credit or refund, arising out of zero-rated transactions, is essentially based on excess payment. In
zero-rating a transaction, the purpose is not to benefit the person legally liable to pay the tax, like
SPP, but to relieve exempt entities like NPC which supplies electricity to factories, offices, and homes,
from having to shoulder the tax burden that ultimately would be passed to the public.
EXCISE TAXES
COMMISSIONER OF INTERNAL REVENUE v. SAN MIGUEL CORPORATION

G.R. No. 184428, 23 November 2011, FIRST DIVISION (Villarama, Jr., J.)
Tax burdens are not to be imposed, nor presumed to be imposed beyond what the statute
expressly and clearly imports, tax statutes being construed strictissimi juris against the government.
San Miguel Corporation (San Miguel), a domestic corporation engaged in the manufacture
and sale of fermented liquor, produces as one of its products “Red Horse beer”. On January 1, 1998,
Republic Act (R.A.) No. 8424 or the Tax Reform Act of 1997 took effect. Thereafter, the Secretary of
Finance issued Revenue Regulations No. 17-99 increasing the applicable tax rates on fermented
liquor by 12%. Now, for the period June 1, 2004 to December 31, 2004, San Miguel was assessed and
paid excise taxes amounting to P2,286,488,861.58 for the 323,407,194 liters of Red Horse beer
products removed from its plants. Said amount was computed based on the tax rate of P7.07/liter or
the tax rate which was being applied to its products prior to January 1, 2000, as the last paragraph of
Section 1 of Revenue Regulations No. 17-99 provided that the new specific tax rate for fermented
liquors "shall not be lower than the excise tax that is actually being paid prior to January 1, 2000." San
Miguel, however, contended that the said qualification in the last paragraph of Section 1 of Revenue
Regulations No. 17-99 has no basis in the plain wording of Section 143. San Miguel argued that the
applicable tax rate was only the P 6.89/liter tax rate stated in Revenue Regulations No. 17-99. San
Miguel filed before the BIR a claim for refund or tax credit of the amount of P60,778,519.56 as
erroneously paid excise taxes. Later, said amount was reduced to P58,213,294.92 because of
prescription. As the Commissioner of Internal Revenue (CIR) failed to act on the claim, San Miguel
filed a petition for review with the CTA. CTA Second Division granted the petition and ordered CIR
to refund P58,213,294.92 to San Miguel or to issue in the latter’s favor a Tax Credit Certificate for the
said amount for the erroneously paid excise taxes. Subsequently, CTA En Banc affirmed the Decision
and Resolution of the CTA Second Division. Undaunted, CIR filed the instant petition for review on
certiorari.
ISSUE:
Whether or not the last paragraph of Section 1 of Revenue Regulations No. 17-99 finds
support in the clear and plain wording of Section 143 of the Tax Reform Act of 1997.
RULING:
YES. Section 143 of the Tax Reform Act of 1997 is clear and unambiguous. It provides for two
periods: the first is the 3-year transition period beginning January 1, 1997, the date when R.A. No.
8240 took effect, until December 31, 1999; and the second is the period thereafter. During the 3-year
transition period, Section 143 provides that "the excise tax from any brand of fermented liquor "shall
not be lower than the tax which was due from each brand on October 1, 1996." After the transitory
period, Section 143 provides that the excise tax rate shall be the figures provided under paragraphs
(a), (b) and (c) of Section 143 but increased by 12%, without regard to whether such rate is lower or
higher than the tax rate that is actually being paid prior to January 1, 2000 and therefore, without
regard to whether the revenue collection starting January 1, 2000 may turn out to be lower than that
collected prior to said date. Revenue Regulations No. 17-99, however, created a new tax rate when
it added in the last paragraph of Section 1 thereof, the qualification that the tax due after the 12%
increase becomes effective ”shall not be lower than the tax actually paid prior to January 1, 2000." As
there is nothing in Section 143 of the Tax Reform Act of 1997 which clothes the BIR with the power
or authority to rule that the new specific tax rate should not be lower than the excise tax that is
actually being paid prior to January 1, 2000, such interpretation is clearly an invalid exercise of the
power of the Secretary of Finance to interpret tax laws and to promulgate rules and regulations
necessary for the effective enforcement of the Tax Reform Act of 1997. In case of discrepancy
between the basic law and a rule or regulation issued to implement said law, the basic law prevails
as said rule or regulation cannot go beyond the terms and provisions of the basic law. It must be
stressed that the objective of issuing BIR Revenue Regulations is to establish parameters or
guidelines within which our tax laws should be implemented, and not to amend or modify its
substantive meaning and import.
DOCUMENTARY TAXES
COMMISSIONER OF INTERNAL REVENUE v. MANILA BANKERS’ LIFE INSURANCE

CORPORATION
The documentary stamp tax on insurance policies, though imposed on the document itself, is
actually levied on the privilege to conduct insurance business.
Manila Bankers’ Life Insurance Corporation (Manila Bankers’) is a duly organized domestic
corporation primarily engaged in the life insurance business. Commissioner of Internal Revenue
(CIR) organized a special team of Revenue Officers to examine the books of accounts and other
accounting records of Manila Bankers’ for taxable year 1997 and unverified prior years. Based on the
findings, CIR issued a preliminary assessment notice against Manila Bankers’ for its deficiency
internal revenue taxes for the year 1997. Manila Bankers’ agreed to all the assessments issued against
it except to the amount of P2,351,680.90 representing deficiency documentary stamp taxes on its
policy premiums and penalties.
The CIR issued against Manila Bankers’ a formal letter of demand with an assessment notice
pertaining to the documentary stamp taxes due on Manila Bankers’ policy premiums. The tax
deficiency was computed by including the increases in the life insurance coverage of two kinds of
policies: the “Money Plus Plan,” which is an ordinary term life insurance policy; and the group life
insurance policy. The amount of P818,919,000.00 comprises the increases in the sum assured for the
Manila Bankers’ ordinary insurance—the “Money Plus Plan” (P74,755,000.00), and group insurance
(P744,164,000.00).
Manila Bankers’ filed a letter of protest with the Bureau of Internal Revenue (BIR) contesting
the assessment for deficiency documentary stamp tax on its insurance policy premiums. The letter
of protest was not acted upon by the BIR within the period given. Hence, Manila Bankers filed a
petition for review with the Court of Tax Appeals (CTA) for the cancellation of the assessment notice.
The CTA rendered a decision in favor of Manila Bankers. Aggrieved, the CIR went to the Court of
Appeals (CA). The CA sustained the decision of the CTA. Hence, this petition.
ISSUE:
Whether or not Manila Bankers is liable for the deficiency computed based on the increases
in the life insurance coverage of the “Money Plus Plan”, and the group life insurance policy.
RULING:
YES. The phrase “other instruments” under Section 183 of the National Internal Revenue
Code (NIRC) as also found in the earlier version of Section 183, i.e., Section 1449(j) of the
Administrative Code of 1917, was explained in Regulations No. 26, to wit:
“Section 52. “Other instruments” defined.—The term “other instruments” includes any
instrument by whatever name the same is called whereby insurance is made or
renewed, i.e., by which the relationship of insurer and insured is created or evidenced,
whether it be a letter of acceptance, cablegrams, letters, binders, covering notes, or
memoranda.”
Whenever a master policy admits of another member, another life is insured and covered.
This means that the Manila Bankers, by approving the addition of another member to its existing
master policy, is once more exercising its privilege to conduct the business of insurance, because it is
yet again insuring a life. It does not matter that it did not issue another policy to effect this change,
the fact remains that insurance on another life is made and the relationship of insurer and insured is
created between Manila Bankers and the additional member of that master policy. In Manila Bankers’
case, its group insurance plan is embodied in a contract which in another life is insured and covered.
This means Manila Bankers, by approving the addition of another member to its existing
master policy, is once more exercising its privilege to conduct the business of insurance, because it is
yet again insuring a life. It does not matter that it did not issue another policy to effect this change,
the fact remains that insurance on another life is made and the relationship of insurer and insured is
created between Manila Bankers and the additional member of that master policy.
In Manila Bankers’ case, its group insurance plan is embodied in a contract which includes
not only the master policy, but all documents subsequently attached to the master policy. Among
these documents are the Enrollment Cards accomplished by the employees when they applied for
membership in the group insurance plan. The Enrollment Card of a new employee, once registered
in the Schedule of Benefits and attached to the master policy, becomes evidence of such employee’s
membership in the group insurance plan, and his right to receive the benefits therein. Every time
Manila Bankers registers and attaches an Enrollment Card to an existing master policy, it exercises
its privilege to conduct its business of insurance and this is patently subject to documentary stamp
tax as insurance made upon a life under Section 183.
The Court would like to make it clear that the assessment for deficiency documentary stamp
tax is being upheld not because the additional premium payments or an agreement to change the
sum assured during the effectivity of an insurance plan are subject to documentary stamp tax, but
because documentary stamp tax is levied on every document which establishes that insurance was
made or renewed upon a life.
PRUDENTIAL BANK v. COMMISSIONER OF INTERNAL REVENUE

A certificate of deposit need not be in a specific form; thus, a passbook of an interest-earning
deposit account issued by a bank is a certificate of deposit drawing interest.
Prudential Bank received from the Commissioner of Internal Revenue (CIR) a Final
Assessment Notice and a Demand Letter for deficiency Documentary Stamp Tax (DST) for the taxable
year 1995 on its Repurchase Agreement with the Bangko Sentral ng Pilipinas (BSP), Purchase of
Treasury Bills from the BSP, and on its Savings Account Plus (SAP) product. Prudential Bank
protested the assessment, but it was denied by the CIR. Thus, Prudential Bank filed a petition for
review before the Court of Tax Appeals (CTA).
The CTA First Division affirmed the assessment for deficiency DST insofar as the SAP is
concerned, but cancelled and set aside the assessment on the repurchase agreement and purchase of
treasury bills with the BSP. The CTA En Banc affirmed that Prudential Bank’s SAP is a certificate of
deposit bearing interest subject to DST under Section 180 of the old National Internal Revenue Code
(NIRC), as amended by Republic Act (RA) No. 7660. Prudential Bank’s motion for reconsideration
was denied.
ISSUE:
Whether or not Prudential Bank’s SAP is a certificate of deposit bearing interest, thus, subject
to DST.
RULING:
YES. DST is imposed on certificates of deposit bearing interest pursuant to Section 180 of the
old NIRC. A certificate of deposit is defined as a written acknowledgment by a bank or banker of the
receipt of a sum of money on deposit which the bank or banker promises to pay to the depositor, to
the order of the depositor, or to some other person or his order, whereby the relation of debtor and
creditor between the bank and the depositor is created.
In China Banking Corporation v. Commissioner of Internal Revenue, the Court held that the
Savings Plus Deposit Account, which has the following features:
1. Amount deposited is withdrawable anytime;

2. The same is evidenced by a passbook;
3. The rate of interest offered is the prevailing market rate, provided the depositor
would maintain his minimum balance in thirty (30) days at the minimum, and should
he withdraw before the period, his deposit would earn the regular savings deposit
rate;
is subject to DST as it is essentially the same as the Special/Super Savings Deposit Account
in Philippine Banking Corporation v. Commissioner of Internal Revenue, and the Savings Account-Fixed
Savings Deposit in International Exchange Bank v. Commissioner of Internal Revenue, which are
considered certificates of deposit drawing interests.
Similarly, in this case, although the money deposited in a SAP is payable anytime, the
withdrawal of the money before the expiration of 30 days results in the reduction of the interest rate.
In the same way, a time deposit withdrawn before its maturity results to a lower interest rate and
payment of bank charges or penalties.
The fact that the SAP is evidenced by a passbook likewise cannot remove its coverage from
Section 180 of the old NIRC, as amended. A document to be considered a certificate of deposit need
not be in a specific form. Thus, a passbook issued by a bank qualifies as a certificate of deposit
drawing interest because it is considered a written acknowledgement by a bank that it has accepted
a deposit of a sum of money from a depositor. Thus, Prudential Bank’s SAP is subject to DST.
REAL PROPERTY TAXATION
CITY OF PASIG, REPRESENTED BY THE CITY TREASURER and THE CITY ASSESSOR v.
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE PRESIDENTIAL COMMISSION ON
GOOD GOVERNMENT
Properties owned by the Republic of the Philippines are exempt from real property tax except
when the beneficial use thereof has been granted, for consideration or otherwise, to a taxable person.
Mid-Pasig Land Development Corporation (MPLDC) owned two parcels of land, with a total
area of 18.4891 hectares, situated in Pasig City. The properties are covered by Transfer Certificate of
Title (TCT) Nos. 337158 and 469702 and Tax Declaration Nos. E-030-01185 and E-030-01186 under
the name of MPLDC. Portions of the properties are leased to different business establishments. In
1986, the registered owner of MPLDC, Jose Y. Campos (Campos), voluntarily surrendered MPLDC to
the Republic of the Philippines.
In 2002, the Pasig City Assessors Office sent MPLDC two notices of tax delinquency for its
failure to pay real property tax on the properties for the period 1979 to
2001 totalingP256,858,555.86. Independent Realty Corporation (IRC) President Ernesto
R. Jalandoni (Jalandoni) and Treasurer Rosario Razon informed the Pasig City Treasurer that the tax
for the period 1979 to 1986 had been paid, and that the properties were exempt from tax beginning
1987. The Pasig City Treasurer informed MPLDC and IRC that the properties were not exempt from
tax. Thereafter, the Pasig City Assessors Office sent MPLDC a notice of final demand for payment of
tax for the period 1987 to 2005 totaling P389,027,814.48. On the same day, MPLDC
paid P2,000,000 partial payment under protest. MPLDC received two warrants of levy on the
properties.
The Republic of the Philippines, through the Presidential Commission on Good Government
(PCGG), filed with the RTC a petition for prohibition with prayer for issuance of a temporary
restraining order or writ of preliminary injunction to enjoin petitioner Pasig City from auctioning the
properties and from collecting real property tax. The Pasig City Treasurer offered the properties for
sale at public auction. Since there was no other bidder, Pasig City bought the properties and was
issued the corresponding certificates of sale. PCGG then filed with the RTC an amended petition for
certiorari, prohibition and mandamus against Pasig City.
The RTC granted the petition for certiorari, prohibition and mandamus. Pasig City appealed
to the Court of Appeals which set aside the RTC’s decision. On PCGG’s Motion for Reconsideration,
the CA reversed itself.
ISSUE:
Whether the properties are exempt from real estate tax.

RULING:
NO. As correctly found by the RTC and the Court of Appeals, the Republic of the Philippines
owns the properties. Campos voluntarily surrendered MPLDC, which owned the properties, to the
Republic of the Philippines. Even as the Republic of the Philippines is now the owner of the properties
in view of the voluntary surrender of MPLDC by its former registered owner, Campos, to the State,
such transfer does not prevent a third party with a better right from claiming such properties in the
proper forum. In the meantime, the Republic of the Philippines is the presumptive owner of the
properties for taxation purposes.
Section 234(a) of Republic Act No. 7160 states that properties owned by the Republic of the
Philippines are exempt from real property tax except when the beneficial use thereof has been
granted, for consideration or otherwise, to a taxable person. Thus, the portions of the properties not
leased to taxable entities are exempt from real estate tax while the portions of the properties leased
to taxable entities are subject to real estate tax. The law imposes the liability to pay real estate tax on
the Republic of the Philippines for the portions of the properties leased to taxable entities. It is, of
course, assumed that the Republic of the Philippines passes on the real estate tax as part of the rent
to the lessees.
In the present case, the parcels of land are not properties of public dominion because they
are not intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed
by the State, banks, shores, roadsteads. Neither are they intended for some public service or for the
development of the national wealth. MPLDC leases portions of the properties to different business
establishments. Thus, the portions of the properties leased to taxable entities are not only subject to
real estate tax, they can also be sold at public auction to satisfy the tax delinquency.
In sum, only those portions of the properties leased to taxable entities are subject to real
estate tax for the period of such leases. Pasig City must, therefore, issue to respondent new real
property tax assessments covering the portions of the properties leased to taxable entities. If the
Republic of the Philippines fails to pay the real property tax on the portions of the properties leased
to taxable entities, then such portions may be sold at public auction to satisfy the tax delinquency.
JUDICIAL REMEDIES
CENTRAL LUZON DRUG CORPORATION v. COMMISSIONER OF INTERNAL REVENUE

An appellant who withdraws his appeal must face the consequence of his withdrawal, such as
the decision of the court a quo becoming final and executory.
Central Luzon Drug Corporation (CLDC) is a duly registered corporation engaged in the retail
of medicines and other pharmaceutical products.
In April 2005, CLDC filed with Commissioner of Internal Revenue (CIR) a request for the
issuance of tax credit certificate in the amount of P32,170,409, representing the 20% sales discounts
allegedly granted to senior citizens for the year 2002.
CLDC filed with the Court of Tax Appeals (CTA) a petition for review. The First Division of the
CTA rendered a decision denying the CLDC’s claim for insufficiency of evidence. Aggrieved, CLDC filed
an appeal to the CTA En Banc. The CTA En Banc denied the appeal due to procedural grounds. CLDC
filed a motion for reconsideration, but the CTA En Banc denied the same.
Hence, CLDC filed a petition for review on certiorari before the Supreme Court to set aside
the resolutions of the CTA En Banc. The Court required CLDC to file a reply, but instead of filing a
reply, CLDC filed a motion to withdraw, praying that the case be dismissed without prejudice.
ISSUE:
Whether or not the case may be dismissed without prejudice.
RULING:
YES. The records show that the Court resolved to require CLDC to file a reply. Instead of
complying, CLDC opted to file a motion to withdraw. Clearly, by requiring CLDC to file its reply, the
Court has not yet deemed the case submitted for decision or resolution. Thus, the Court resolved to
grant CLDC’s motion to withdraw.
However, the Court agreed with the Office of the Solicitor General that the dismissal of the
instant case should be with prejudice. By withdrawing the appeal, CLDC is deemed to have accepted
the decision of the CTA. And since the CTA had already denied CLDC’s request for the issuance of a
tax credit certificate in the amount of P32,170,409 for insufficiency of evidence, it may no longer be
included in CLDC’s future claims. CLDC cannot be allowed to circumvent the denial of its request for
a tax credit by abandoning its appeal and filing a new claim. To reiterate, “an appellant who
withdraws his appeal x x x must face the consequence of his withdrawal, such as the decision of the
court a quo becoming final and executory.”
REVISED RULES OF COURT OF TAX APPEALS
PHILIPPINE NATIONAL BANK v. COMMISSIONER OF INTERNAL REVENUE

A pleading filed by ordinary mail or by private messengerial service is deemed filed on the day
it is actually received by the court, and not on the day it was mailed or delivered to the messengerial
service.
Philippine National Bank (PNB) filed with the Commissioner of Internal Revenue (CIR) an
administrative claim for refund for payments made in excess of its income tax liability for 1998. As
Bureau of Internal Revenue (BIR) did not act upon PNB’s claim for refund, PNB filed its Petition for
Review with the Second Division of the Court of Tax Appeals (CTA Division). Meanwhile, the BIR
issued a Tax Credit Certificate in PNB’s favor. PNB then informed the CTA Division of such tax credit
certificate, and manifested that its acceptance was without prejudice to recovering the balance of its
total claim. Thereafter, the CTA Division ruled in favor of PNB but affirmed the disallowance of eight
transactions, as they had already been reported as income for other years, had not been recorded, or
were not supported by pertinent documents. PNB moved for partial reconsideration, but was denied.
PNB filed a partial appeal by way of Petition for Review under Section 18 of Republic Act No. 9282
before the CTA En Banc. The CTA En Banc dismissed the petition for the following reasons: (1) the
Petition For Review was filed four (4) days late as it was received by the CTA En Banc four days
beyond the additional 15 days granted to PNB to file its petition; (2) the petition is not accompanied
by the duplicate original or certified true copies of the assailed Decision; and (3) the petition does
not contain an Affidavit of Service.
PNB filed a Motion for Reconsideration with Manifestation of Compliance. PNB asserted that
its petition was filed on December 23, 2005, which was the last day of the additional 15-day period
granted by the CTA En Banc, via LBC Express. PNB explained that its counsel, Atty. Flerida P. Zaballa-
Banzuela, accompanied by her administrative assistant, tried to personally file the petition with the
CTA En Banc on December 23, 2005. However, PNB claimed, that due to heavy traffic, Atty. Zaballa-
Banzuela arrived at the CTA office in Quezon City at 4:30 p.m., just as the CTA personnel were leaving
the CTA premises in their shuttle bus. PNB argued that while its petition was deposited with LBC
Express on December 23, 2005, very well within the reglementary period, CTA En Banc received it
only on December 27, 2005, as December 24 to 26, 2005 were holidays.
ISSUE:
Whether or not the Court should require the CTA En Banc to give due course to PNB’s petition
despite PNB’s failure to comply with the formal requirements of the Revised Rules of the Court of Tax
Appeals and the Rules of Court in filing a petition for review with the CTA En Banc.
RULING:
NO. The Court would like to underscore the fact that PNB failed to comply with not just one,
but three procedural rules when it filed its petition for review with the CTA En Banc. It is stated under
Section 3, Rule 1 of the Revised Rules of the Court of Tax Appeals that the Rules of Court shall apply
suppletorily. Thus, the manner in which petitions are filed before the CTA is also covered by the
relevant provision of the Rules of Court.
PNB argues that its petition was filed on time since it was mailed on the last day of the
extended period, which was on December 23, 2005. It has been established that a pleading filed by
ordinary mail or by private messengerial service is deemed filed on the day it is actually received by
the court, and not on the day it was mailed or delivered to the messengerial service. It is worthy to
note that PNB already asked for an additional period of 15 days within which to file its petition for
review with the CTA En Banc. This period expired on December 23, 2005. Knowing fully well that
December 23, 2005 not only fell on a Friday, followed by three consecutive non-working days, but
also belonged to the busiest holiday season of the year, PNB should have exercised more prudence
and foresight in filing its petition.It is, however, curious why PNB chose to risk the holiday traffic in
an effort to personally file its petition with the CTA En Banc, when it already filed a copy to the other
party, the CIR, via registered mail. Considering the circumstances, it would have been more logical
for PNB to send its petition to the CTA En Banc on the same occasion it sent a copy to the CIR,
especially since that day was already the last day given to PNB to file its petition. Moreover, PNB
offered no justification as to why it sent its petition via ordinary mail instead of registered mail.
Service by ordinary mail is allowed only in instances where no registry service exists.
The petition also is not accompanied by the duplicate original or certified true copies of the
assailed Decision in violation of Section 2, Rule 6 of the Revised Rules of the Court of Tax Appeals, in
relation to Section 6, Rule 43 of the Rules of Court. The Court has already upheld the mandatory
character of attaching duplicate originals or certified true copies of the assailed decision to a petition
for review. Moreover, pursuant to Section 7, Rule 43 of the Rules of Court, non-compliance with such
mandatory requirement is a sufficient ground to dismiss the petition. The Petition does not also
contain an Affidavit of Service, in violation of Section 13, Rule 13 of the Rules of Court. Although the
failure to attach the required affidavit of service is not fatal if the registry receipt attached to the
petition clearly shows service to the other party, it must be remembered that this was not the only
rule of procedure PNB failed to satisfy.
MERCANTILE LAW
NEGOTIABLE INSTRUMENTS LAW
Consideration
ENGR. JOSE E. CAYANAN v. NORTH STAR INTERNATIONAL TRAVEL, INC.

Under the Negotiable Instruments Law, it is presumed that every party to an instrument
acquires the same for a consideration or for value.
North Star International Travel Inc. (North Star) is a corporation engaged in the travel agency
business while Engr. Jose Cayanan (Engr. Cayanan) is the owner/general manager of JEAC
International Management and Contractor Services, a recruitment agency. Virginia Balagtas
(Balagtas), the General Manager of North Star, in accommodation and upon the instruction of its
client, Engr. Cayanan herein, sent the amount of US$60,000 to View Sea Ventures Ltd., in Nigeria from
her personal account in Citibank Makati. Virginia again sent US$40,000 to View Sea Ventures with
US$15,000 coming from Engr. Cayanan. Likewise, on various dates, North Star extended credit to
Engr. Cayanan for the airplane tickets of his clients, with the total amount of such indebtedness under
the credit extensions eventually reaching P510,035.47. When presented for payment, the checks in
the amount of P1,500,000 and P35,000 were dishonored for insufficiency of funds while the other
three checks were dishonored because of a stop payment order from Engr. Cayanan. North Star,
through its counsel, wrote Engr. Cayanan informing him that the checks he issued had been
dishonored. North Star demanded payment, but Engr. Cayanan failed to settle his obligations. Hence,
North Star instituted a criminal case charging Engr. Cayanan with violation of Batas Pambansa Blg.
22, or the Bouncing Checks Law, before the Metropolitan Trial Court (MeTC). MeTC found Engr.
Cayanan guilty beyond reasonable doubt of violation of B.P. 22. On appeal, the Regional Trial Court
(RTC) acquitted Engr. Cayanan of the criminal and civil charges. Aggrieved, North Star elevated the
case to the Court of Appeals (CA). CA reversed the decision of the RTC insofar as the civil aspect is
concerned and held Engr. Cayanan civilly liable for the value of the subject checks.
ISSUE:
Whether or not Engr. Cayanan shall be held civilly liable to North Star for the value of the
checks.
RULING:
YES. The Court held that upon issuance of a check, it is presumed that the same was issued
for valuable consideration. As Engr. Cayanan alleged that there was no consideration for the issuance
of the subject checks, it devolved upon him to present convincing evidence to overthrow the
presumption and prove that the checks were in fact issued without valuable consideration. Sadly,
however, Engr. Cayanan has not presented any credible evidence to rebut the presumption, as well
as North Star’s assertion, that the checks were issued as payment for the US$85,000 Engr. Cayanan
owed. The evidence shows that it was Engr. Cayanan who had a contract with View Sea Ventures as
he was sending contract workers to Nigeria; Balagtas’ participation was merely to send the money
through telegraphic transfer in exchange for the checks issued by Engr. Cayanan to North Star.
Indeed, the transaction between Engr. Cayanan and North Star is actually in the nature of a loan and
the checks were issued as payment of the principal and the interest. Further, the fact that Engr.
Cayanan himself specifically named North Star as the payee of the checks is an admission of his
liability to North Star and not to Virginia Balagtas, who as manager merely facilitated the transfer of
funds. Indeed, it is highly inconceivable that an experienced businessman like Engr. Cayanan would
issue various checks in sizeable amounts to a payee if these are without consideration. Thus, the
inevitable conclusion is that when Engr. Cayanan issued the subject checks to North Star as payee, he
did so to settle his obligation with North Star for the US$85,000. And since the only payment Engr.
Cayanan made to North Star was in the amount of P220,000.00, which was applied to interest due,
his liability is not extinguished. Having failed to fully settle his obligation under the checks, the
appellate court was correct in holding petitioner liable to pay the value of the five checks he issued
in favor of North Star.
INSURANCE LAW
Right of Subrogation
ASIAN TERMINALS, INC. v. MALAYAN INSURANCE, CO., INC

The right of subrogation accrues simply upon payment by the insurance company of the
insurance claim.
Malayan Insurance, Co., Inc, the insurer of the 60,000 plastic bags of soda ash dense shipped
by Shandong Weifang Soda Ash Plant from China to Manila as subrogee of the consignee, filed before
the Regional Trial Court (RTC) of Manila, Branch 35, a Complaint for damages against Asian
Terminals Inc, a duly registered domestic corporation engaged in providing arrastre and stevedoring
services. Asian contends that Malayan has no cause of action because it failed to present the insurance
contract or policy covering the subject shipment. It further argued that the Subrogation Receipt
presented by Malayan is not sufficient to prove that the subject shipment was insured and that
Malayan was validly subrogated to the rights of the consignee.
ISSUE:
Whether or not a reimbursement to Malayan Insurance is warranted.
RULING:
YES. Non-presentation of the insurance contract or policy is not fatal in the instant case. The
subrogation receipt, by itself, is sufficient to establish not only the relationship of herein private
respondent as insurer and Caltex, as the assured shipper of the lost cargo of industrial fuel oil, but
also the amount paid to settle the insurance claim. The right of subrogation accrues simply upon
payment by the insurance company of the insurance claim. Moreover, since there was no issue
regarding the validity of the insurance contract or policy, or any provision thereof, respondent had
no reason to present the insurance contract or policy as evidence during the trial.
Once the insurer pays the insured, equity demands reimbursement, as no one should benefit
at the expense of the other.
TRANSPORTATION LAW
Registered Owner Rule
FEB LEASING AND FINANCE CORPORATION (now BPI LEASING CORPORATION) v. SPOUSES
SERGIO P. BAYLON and MARITESS VILLENA-BAYLON, BG HAULER, INC., and MANUEL Y.
ESTILLOSO
G.R. No. 181398, G.R. No. 181398, 29 June 2011, SECOND DIVISION (Carpio, J.)
The registered owner of the vehicle is liable for quasi-delicts resulting from its use, even if the
vehicle has already been sold, leased or transferred to another person at the time the vehicle figured in
an accident, if the transfer is not registered with the Land Transportation Office.
An Isuzu oil tanker, registered in the name of petitioner FEB Leasing and Finance Corporation
and leased to BG Hauler, Inc., was running along Del Monte Avenue in Quezon City. While executing
a left turn upon reaching an intersection, the oil tanker hit Loretta Baylon, daughter of Spouses Sergio
and Maritess Baylon, who was then crossing the Del Monte Avenue. Due to the strong impact, Loretta
was violently thrown away resulting to her death. FEB contends that the lease contract with BG
Hauler specifically provides that BG Hauler shall be liable for any loss, damage, or injury the leased
oil tanker may cause even if FEB is the registered owner of the said oil tanker.
ISSUE:
Whether or not FEB Leasing and Finance Corp. (now BPI Leasing Corp.) should be held liable
notwithstanding an exemption provision in the financial lease contract.
RULING:
YES. In accordance with the law on compulsory motor vehicle registration, with respect to
the public and third persons, the registered owner of a motor vehicle is directly and primarily
responsible for the consequence of its operation regardless of who the actual vehicle owner might
be. Well-settled is the rule that the registered owner of the vehicle is liable for quasi-delicts resulting
from its use. Thus, even if the vehicle has already been sold, leased or transferred to another person
at the time the vehicle figured in an accident, the registered vehicle owner would still be liable for
damages caused by the accident. The sale, transfer or lease of the vehicle, which is not registered with
the Land Transportation Office, will not bind third persons aggrieved in an accident involving the
vehicle.
MARITIME COMMERCE
Doctrine of Limited Liability
AGUSTIN P. DELA TORRE v. THE HONORABLE COURT OF APPEALS, et al.

G.R. Nos. 160088 & 160565, 13 July 2011, THIRD DIVISION (Mendoza, J.)
The only person who could avail of the Limited Liability Rule is the shipowner – he is the very
person whom the Rule has been conceived to protect; charterers cannot invoke this as a defense.
Crisostomo G. Concepcion (Concepcion) owned the vessel LCT-Josephine. He entered into a

Preliminary Agreement with Roland de la Torre (Roland), wherein Concepcion agreed that the LCT-
Josephine would be chartered after its dry-docking and repair. Concepcion and the Philippine Trigon
Shipyard Corporation (PTSC), represented by Roland, entered into a Contract of Agreement, wherein
the latter would charter LCT-Josephine. Subsequently, PTSC/Roland sub-chartered LCT-
Josephine to Trigon Shipping Lines (TSL), a single proprietorship owned by Roland’s father, Agustin
de la Torre (Agustin). TSL, this time represented by Roland per Agustin’s Special Power of Attorney,
sub-chartered LCT-Josephine to Ramon Larrazabal (Larrazabal) for the transport of cargo consisting
of sand and gravel to Leyte.
During the unloading of the vessel’s cargo in Leyte, LCT-Josephine sank. Concepcion
demanded that PTSC/Roland refloat LCT-Josephine. The latter assured Concepcion that negotiations
were underway for the refloating of his vessel, but this did not materialize. This prompted
Concepcion to file a complaint for Sum of Money and Damages against PTSC and Roland. The
Regional Trial Court (RTC) declared that the efficient cause of the sinking of the LCT-Josephine was
the improper lowering or positioning of the ramp, which was well within the charge or responsibility
of the captain and crew of the vessel. The Court of Appeals (CA) affirmed. The charterers and sub-
charterers insist the application of the Limited Liability Rule to them.
ISSUE:
Whether or not the Limited Liability Rule should be applied to the charterers and sub-
charterers.
RULING:
NO. The Limited Liability Rule under the Code of Commerce has been explained to be that of
the real and hypothecary doctrine in maritime law where the shipowner or ship agent’s liability is
held as merely co-extensive with his interest in the vessel such that a total loss thereof results in its
extinction. In this jurisdiction, this rule is provided in three articles of the Code of Commerce. Article
837 specifically applies to cases involving collision which is a necessary consequence of the right to
abandon the vessel given to the shipowner or ship agent under Article 587. Similarly, Article 590 is a
reiteration of Article 587, only this time the situation is that the vessel is co-owned by several
persons. Obviously, the forerunner of the Limited Liability Rule under the Code of Commerce is
Article 587. Now, the latter is quite clear on which indemnities may be confined or restricted to the
value of the vessel pursuant to the said Rule, and these are the indemnities in favor of third persons
which may arise from the conduct of the captain in the care of the goods which he loaded on the
vessel. Thus, what is contemplated is the liability to third persons who may have dealt with the
shipowner, the agent or even the charterer in case of demise or bareboat charter.
The only person who could avail of this is the shipowner, Concepcion. He is the very person
whom the Limited Liability Rule has been conceived to protect. The petitioners cannot invoke this as
a defense. Concepcion, as the real shipowner, is the one who is supposed to be supported and
encouraged to pursue maritime commerce. Thus, it would be absurd to apply the Limited Liability
Rule against him who, in the first place, should be the one benefitting from the said rule. Even if the
contract is for a bareboat or demise charter where possession, free administration and even
navigation are temporarily surrendered to the charterer, dominion over the vessel remains with the
shipowner. Ergo, the charterer or the sub-charterer, whose rights cannot rise above that of the
former, can never set up the Limited Liability Rule against the very owner of the vessel.
The Carriage of Goods by Sea Act

NEW WORLD INTERNATIONAL DEVELOPMENT (PHILS.), INC. v. NYK-FILJAPAN SHIPPING
CORP., et al. / NEW WORLD INTERNATIONAL DEVELOPMENT (PHILS.), INC. v. SEABOARD-
EASTERN INSURANCE CO., INC.,
G.R. Nos. 171468/174241, 24 August 2011, THIRD DIVISION (Abad, J.)
The carrier and the ship shall be discharged from all liability in case of loss or damage unless
the suit is brought within one year after delivery of the goods or the date when the goods should have
been delivered.
New World International Development (Phils.), Inc. (New World) bought from DMT
Corporation (DMT) through its agent, Advatech Industries, Inc. (Advatech) three emergency
generator sets. DMT shipped the generator sets by truck from Wisconsin, United States, to LEP Profit
International, Inc. (LEP Profit) in Chicago, Illinois. From there, the shipment went by train
to Oakland, California, where it was loaded on S/S California Luna V59, owned and operated by NYK
Fil-Japan Shipping Corporation (NYK) for delivery to petitioner New World in Manila. NYK issued a
bill of lading, declaring that it received the goods in good condition.
NYK unloaded the shipment in Hong Kong and transshipped it to S/S ACX Ruby V/72 that it
also owned and operated. On its journey to Manila, however, ACX Ruby encountered
typhoon Kadiang whose captain filed a sea protest on arrival at the Manila South Harbor on October
5, 1993 respecting the loss and damage that the goods on board his vessel suffered.
Marina Port Services, Inc. (Marina), the Manila South Harbor arrastre or cargo-handling
operator, received the shipment on October 7, 1993. Upon inspection of the three container vans
separately carrying the generator sets, two vans bore signs of external damage while the third van
appeared unscathed. The shipment remained at Pier 3s Container Yard under Marinas care pending
clearance from the Bureau of Customs. Eventually, on October 20, 1993 customs authorities allowed
petitioners customs broker, Serbros Carrier Corporation (Serbros), to withdraw the shipment and
deliver the same to petitioner New Worlds job site in Makati City.
An examination of the three generator sets in the presence of New World’s representatives
and surveyors of New World’s insurer, Seaboard Eastern Insurance Company (Seaboard), revealed
that all three sets suffered extensive damage and could no longer be repaired. For these reasons, New
World demanded recompense for its loss from respondents NYK, DMT, Advatech, LEP Profit, LEP
International Philippines, Inc. (LEP), Marina, and Serbros. While LEP and NYK acknowledged receipt
of the demand, both denied liability for the loss.
Since Seaboard covered the goods with a marine insurance policy, New World sent it a formal
claim. Replying, Seaboard required New World to submit to it an itemized list of the damaged units,
parts, and accessories, with corresponding values, for the processing of the claim. However, New
World did not submit what was required of it, insisting that the insurance policy did not include the
submission of such a list in connection with an insurance claim. Reacting to this, Seaboard refused to
process the claim.
New World filed an action for specific performance and damages against all the respondents
before the RTC of Makati City which rendered a decision absolving the various respondents from
liability with the exception of NYK. On appeal, the Court of Appeals (CA) held that the submission of
the itemized listing was a reasonable requirement that Seaboard asked of New World. Further, the
CA held that the one-year prescriptive period for maritime claims applied to Seaboard, as insurer and
subrogee of New World’s right against the vessel owner. New World’s failure to comply promptly
with what was required of it prejudiced such right.
ISSUE:
Whether New World can still recover from Seabord.
RULING:
YES. The record shows that petitioner New World complied with the documentary
requirements evidencing damage to its generator sets.
The marine open policy that Seaboard issued to New World was an all-risk policy. Such a
policy insured against all causes of conceivable loss or damage except when otherwise excluded or
when the loss or damage was due to fraud or intentional misconduct committed by the insured. The
policy covered all losses during the voyage whether or not arising from a marine peril. Here, the
policy enumerated certain exceptions like unsuitable packaging, inherent vice, delay in voyage, or
vessels unseaworthiness, among others. But Seaboard had been unable to show that petitioner New
World’s loss or damage fell within some or one of the enumerated exceptions.
What is more, Seaboard had been unable to explain how it could not verify the damage that
New Worlds goods suffered going by the documents that it already submitted. Seaboard cannot
pretend that the above documents are inadequate since they were precisely the documents listed in
its insurance policy. Being a contract of adhesion, an insurance policy is construed strongly against
the insurer who prepared it.
Regarding prescription of claims, Section 3(6) of the COGSA provides that the carrier and the
ship shall be discharged from all liability in case of loss or damage unless the suit is brought within
one year after delivery of the goods or the date when the goods should have been delivered. The last
day for filing such a suit fell on October 7, 1994. The record shows that petitioner New World filed its
formal claim for its loss with Seaboard, its insurer, a remedy it had the right to take, as early as
November 16, 1993 or about 11 months before the suit against NYK would have fallen due.
In the ordinary course, if Seaboard had processed that claim and paid the same, Seaboard
would have been subrogated to petitioner New Worlds right to recover from NYK. And it could have
then filed the suit as a subrogee. But, as discussed above, Seaboard made an unreasonable demand
on February 14, 1994 for an itemized list of the damaged units, parts, and accessories, with
corresponding values when it appeared settled that New World’s loss was total and when the
insurance policy did not require the production of such a list in the event of a claim.
CORPORATION LAW
Intra-Corporate Controversies
HEIRS OF SANTIAGO C. DIVINAGRACIA v. HON. J. CEDRICK O. RUIZ

The award of moral damages, exemplary damages and attorney’s fees, awarded as an incident
to an intra-corporate case, are exempt from the rule on immediate execution.
Santiago Divinagracia (Divinagracia), in his capacity as a stockholder, filed a derivative suit
on behalf of People’s Broadcasting Service Incorporated (PBS) assailing a management contract
entered into by PBS and Bombo Radyo Holdings Incorporated (Bombo Radyo) and Rogelio Florete,
Sr. (Florete). In turn, Bombo Radyo and Florete filed a counterclaim against Divinagracia claiming
that the suit filed by him was unfounded and intended only to harass and molest them. During the
pendency of the case, however, Divinagracia died and was, thus, substituted by his heirs.
Later, RTC dismissed the derivative suit filed by Divinagracia and granting the counterclaims
of Bombo Radyo and Florete. Thereafter, the heirs of Divinagracia filed a Notice of Appeal with the
RTC. On their part, Bombo Radyo and Florete filed with the RTC a Motion for Immediate Execution
which was granted. As such, the RTC issued a Writ of Execution. This prompted the Heirs of
Divinagracia to file a petition for certiorari with the CA arguing that RTC erred in granting the writ of
execution for a counterclaim consisting of moral damages, exemplary damages and attorneys fees
despite the fact that said damages under the counterclaim consisted of an ordinary action and was
not an intra-corporate controversy. The CA dismissed the petition for certiorari holding that under
Section 4 of Rule 1 of the Interim Rules of Procedure for Intra-Corporate Controversies, "all decisions
rendered in intra-corporate controversies shall be immediately executory."
ISSUE:
Whether or not moral damages, exemplary damages, and attorney’s fees, awarded as a result
of a counterclaim in an intra-corporate case, are immediately executory.
RULING:
NO. The Court en banc issued a Resolution in A.M. No. 01-2-04-SC titled "Re: Amendment of
Section 4, Rule 1 of the Interim Rules of Procedure Governing Intra-Corporate Controversies” by
clarifying that decisions issued pursuant to said rule are immediately executory except the awards
for moral damages, exemplary damages and attorney’s fees, if any."
The amended provision expressly exempts awards for moral damages, exemplary damages,
and attorney’s fees from the rule that decisions and orders in cases covered by the Interim Rules are
immediately executory. As can be gleaned from the title of A.M. No. 01-2-04-SC, the amendment of
Section 4, Rule 1 of the Interim Rules was crafted precisely to clarify the previous rule that decisions
on intra-corporate disputes are immediately executory, by specifically providing for an exception.
Thus, the prevailing rule now categorically provides that awards for moral damages, exemplary
damages, and attorney’s fees in intra-corporate controversies are not immediately executory.
RENATO REAL v. SANGU PHILIPPINES, INC. and/ or KIICHI ABE

The fact that the parties involved in the controversy are all stockholders or that the parties
involved are the stockholders and the corporation does not necessarily place the dispute within the
ambit of the jurisdiction of the SEC (now the Regional Trial Court). The better policy to be followed in
determining jurisdiction over a case should be to consider concurrent factors such as the status or
relationship of the parties or the nature of the question that is subject of their controversy.
Renato Real (Real), a stockholder and a manager of Sangu Philippines, Inc. (Sangu), together
with 29 others filed their respective Complaints for illegal dismissal against Sangu and Kiichi Abe,
Sangu’s Vice-President and General Manager. These complaints were later consolidated. For its part,
Sangu argued that Real committed gross acts of misconduct detrimental to the company hence Real
is validly terminated. The Labor Arbiter ruled in favor of Real and his co-complainants and declared
them as illegally dismissed. Sangu appealed with the NLRC and raised the issue of lack of jurisdiction.
Sangu claimed that the case is an intra-corporate controversy over which the Labor Arbiter has no
jurisdiction.
Finding the appeal to be meritorious, the NLRC dismissed the complaint of Real for lack of
jurisdiction. The other dismissed employees are however ordered to report back to work. This
prompted Real to file a petition for certiorari with the CA. The CA however affirmed the decision of
the NLRC and ruled that aside from being a stockholder of Sangu, Real is also a corporate officer
thereof and consequently, his complaint is an intra-corporate controversy over which the labor
arbiter has no jurisdiction.
ISSUE:
Whether or not a complaint for illegal dismissal is intra-corporate and thus beyond the
jurisdiction of the Labor Arbiter.
RULING:
NO. To determine whether a case involves an intra-corporate controversy, and is to be heard

and decided by the branches of the RTC specifically designated by the Court to try and decide such
cases, two elements must concur: (a) the status or relationship of the parties, and (2) the nature of
the question that is the subject of their controversy. The first element requires that the controversy
must arise out of intra-corporate or partnership relations between any or all of the parties and the
corporation, partnership, or association of which they are not stockholders, members or associates,
between any or all of them and the corporation, partnership or association of which they are
stockholders, members or associates, respectively; and between such corporation, partnership, or
association and the State insofar as it concerns the individual franchises. The second element
requires that the dispute among the parties be intrinsically connected with the regulation of the
corporation. If the nature of the controversy involves matters that are purely civil in character,
necessarily, the case does not involve an intra-corporate controversy.
While Sangu repeatedly claim that Real was appointed as Manager pursuant to the
corporation’s By-Laws, inconsistencies in their allegations as to how Real was placed in said position,
coupled by the fact that they failed to produce any documentary evidence to prove that Real was
appointed thereto by action or with approval of the board, only leads this Court to believe Real is not
a corporate office but merely an employee of Sanggu. It has been consistently held that "[a]n ‘office’
is created by the charter of the corporation and the officer is elected (or appointed) by the directors
or stockholders." Clearly here, Sangu failed to prove that Real was appointed by the board of
directors. Thus, the Court cannot subscribe to theclaim that Real is a corporate officer. Having said
this, there is no intra-corporate relationship between the parties insofar as Real’s complaint for
illegal dismissal is concerned and that same does not satisfy the relationship test.
As to the nature of controversy test it is not difficult to see that the reasons given by Sangu
for dismissing Real have something to do with his being a Manager of respondent corporation and
nothing with his being a director or stockholder. For one, petitioner’s continuous absences in his post
in Ogino relates to his performance as Manager. Second, respondents’ loss of trust and confidence in
petitioner stemmed from his alleged acts of establishing a company engaged in the same line of
business as respondent corporation’s and submitting proposals to the latter’s clients while he was
still serving as its Manager.
Thus, when petitioner sought for reinstatement, he wanted to recover his position as
Manager, a position which however, was earlier declared to be not a corporate position. He is not
trying to recover a seat in the board of directors or to any appointive or elective corporate position
which has been declared vacant by the board. Certainly, this is a case of termination of employment
which is a labor controversy and not an intra-corporate dispute. In sum, the petitioner’s complaint
likewise does not satisfy the nature of controversy test.
With the elements of intra-corporate controversy being absent in this case, petitioner’s
complaint for illegal dismissal against respondents is not intra-corporate. Rather, it is a termination
dispute and, consequently, falls under the jurisdiction of the Labor Arbiter pursuant to Section 217 of
the Labor Code.
STRATEGIC ALLIANCE DEVELOPMENT CORPORATION v. STAR INFRASTRUCTURE

DEVELOPMENT CORPORATION, et al.
G.R. No. 187872, 11 April 2011, FIRST DIVISION (Perez, J.)
An intra-corporate dispute is understood as a suit arising from intra-corporate relations or

between or among stockholders or between any or all of them and the corporation. The combined
application of the relationship test and the nature of the controversy test has become the norm in
determining whether a case is an intra-corporate controversy or is purely civil in character.
Strategic Alliance Development Corporation (STRADEC), a domestic corporation principally

operating in Bayambang, Pangasinan, incorporated Star Infrastructure Development Corporation
(SIDC) for the purpose of engaging in the general construction business. By virtue of such
incorporation, STRADEC fully paid and owned 49% of SIDC’s shares of stock and moved its place of
business to Lipa, Batangas.
In 2004, Aderito Yujuico and Bonifacio Sumbilla, then President and Treasurer of STRADEC,
respectively, executed a promissory note for and in consideration of a loan extended to STRADEC by
Robert Wong, one of the incorporators of SIDC. As security for the loan, a pledge was constituted over
STRADEC’s entire shareholdings in SIDC. Because of STRADEC’s repeated default on its obligations,
the shares pledged were sold by way of notarial sale with Wong as the sole bidder, and who was
issued the corresponding certificates of stocks. Wong subsequently sold the shares to respondent
Cypress Tree Capital Investment, Inc. (CTCII), a corporation he formed with members of his own
family.
STRADEC filed a petition before the Regional Trial Court (RTC) of Batangas City, praying for
the nullification of the loan and pledge Yujuico and Sumbilla contracted with Wong and the avoidance
of the notarial sale, among others.
The Regional Trial Court (RTC) denied the petition because STRADEC should have filed the
case either in Bayambang, Pangasinan or in any of the residences of Yujuico, Sumbilla, or Wong,
pursuant to the Rules of Court. The Court of Appeals (CA) affirmed the decision, on the ground that
the causes of action are purely civil in nature and should abide by said rule on venue.
Before the Supreme Court (SC), STRADEC asserts that the CA grievously erred in not
characterizing their causes of action intra-corporate and place its venue and jurisdiction in RTC
Batangas City. The SC rendered a decision on November 17, 2010, qualifying STRADEC’s causes of
action as intra-corporate disputes.
SIDC, Yujuico, Sumbilla, and Wong filed a motion for reconsideration, which the SC resolved
on April 11, 2011.
ISSUES:
Whether or not the STRADEC’s suit consists of an intra-corporate dispute.
RULING:
YES. Applying the relationship test and the nature of the controversy test already discussed in
the 17 November 2010 Decision, the Court finds that STRADEC’s causes of action for the nullification
of the loan and pledge over its SIDC shareholdings contracted by respondents Yujuico and Sumbilla
as well as the avoidance of the notarial sale conducted by respondent Raymond M. Caraos both
qualify as intra-corporate disputes. It cannot, therefore, be argued that said causes of action were
misjoined with STRADEC’s third and fourth causes of action for the cancellation of the transfer of its
shares in SIDECs books, the invalidation of the 30 July 2005 and 20 July 2006 SIDC stockholders
meetings, attorneys fees and the costs.
MARY JOY ANNE GUSTILO and BONIFACIO M. PEA v. JOSE VICENTE GUSTILO III and
TERESITA YOUNG also known as TITA SY YOUNG,
G.R. No. 175497, 19 October 2011, THIRD DIVISION (Abad, J.)
Any intra-corporate issues that may be involved in determining the real owner of the property
may be threshed out in a separate proceeding in the proper commercial court.
Mary Joy Anne Gustilo (Mary Joy) and Jose Vicente Gustilo III (Jose Vicente) are heirs of their
natural father, the late Atty. Armando Gustilo, who owned several properties and was, prior to his
death, the president of A.G. Agro-Industrial Corporation (A.G. Agro). Following their father’s death,
Mary Joy and Jose Vicente entered into a Memorandum of Agreement (MOA), adjudicating between
themselves their father’s properties. One of these was Hacienda Imelda, which the MOA assigned to
Mary Joy. As it happened, however, the haciendas title remained in the name of A.G. Agro. Mary Joy
immediately took possession of the land through Mila Barco, her mother and natural guardian, and
planted sugarcane on it. Over three years later, Jose Vicente leased Hacienda Imelda to Tita Sy Young
(Young). When the lease contract was about to expire, Mary Joy had her lawyer advise Young to
surrender the land to her. But the latter refused to yield possession and continued to cultivate the
same for sugarcane. This prompted Mary Joy to file an action against Jose Vicente and Young for
recovery of possession of the hacienda, cancellation of the lease contract, and damages before the
Regional Trial Court (RTC). Jose Vicente filed a motion to dismiss mainly on the ground that the Cadiz
RTC had no jurisdiction to hear and decide intra-corporate disputes. RTC granted Jose Vicente’s
motion and dismissed the complaint for lack of jurisdiction, without prejudice to its re-filing in the
proper court. On appeal, Court of Appeals (CA) affirmed the RTC decision.
ISSUE:
Whether or not Mary Joy’s action presents an intra-corporate dispute that belongs to the
jurisdiction of a specially designated commercial court.
RULING:
YES. It can be gleaned from Mary Joy’s allegations in her complaint that her case is principally
one for recovery of possession. Immediately upon the execution of the MOA in 1993, Mary Joy took
possession of Hacienda Imelda, through her mother, and started planting sugarcane on it. Young, with
the use of force, took over the property with the farm equipment and implements. Despite several
demands to vacate and surrender Hacienda Imelda, Young continued to cultivate and plant
sugarcanes on the property up to 2002, and even entered into a new lease contract with Jose Vicente.
It must be stated that regardless of the actual condition of the title to the property, the party in
peaceable quiet possession shall not be turned out by a strong hand, violence or terror. Thus, a party
who can prove prior possession, can recover such possession even against the owner
himself. Whatever may be the character of his prior possession, if he has in his favor priority in time,
he is entitled to remain on the property until he is lawfully ejected by a person having a better right.
Here, Jose Vicente and Young mainly argued in their Motion to Dismiss that inasmuch as the
subject property is in the name of A.G. Agro, the nature of the claim or controversy is one of intra-
corporate. The Court has ruled in the past that an action to recover possession is a plenary action in
an ordinary civil proceeding to determine the better and legal right to possess, independently of title.
But where the parties raise the issue of ownership, as in this case, the courts may pass upon such
issue to determine who between the parties has the right to possess the property. This adjudication,
however, is not final and binding as regards the issue of ownership; it is merely for the purpose of
resolving the issue of possession when it is inseparably connected to the issue of ownership. The
adjudication on the issue of ownership, being provisional, is not a bar to an action between the same
parties involving title to the property.
MARC II MARKETING, INC. and LUCILA V. JOSON v. ALFREDO M. JOSON

G.R. No. 171993, 12 December 2011, SECOND DIVISION (Perez, J.)
In determining whether the RTC has jurisdiction over the controversy, the status or relationship
of the parties and the nature of the question that is the subject of their controversy must be taken into
consideration.
Marc II Marketing, Inc. is primarily engaged in buying, marketing, selling and distributing in
retail or wholesale for export or import household appliances and products and other items. Lucila
V. Joson is the President and majority stockholder of Mark II. She was also the former President and
majority stockholder of the defunct Marc Marketing, Inc. Alfredo M. Joson, on the other hand, was the
General Manager, incorporator, director and stockholder of Mark II.
Prior its incorporation, Lucila, in her capacity as President of Marc Marketing, Inc., to work as
the General Manager of Mark II engaged the services of Alfredo. Pending incorporation of Mark II,
Alfredo was designated as the General Manager of Marc Marketing, Inc., which was then in the
process of winding up its business. For occupying the said position, respondent was among its
corporate officers by the express provision of Section 1, Article IV of its by-laws. On 15 August 1994,
Mark II was officially incorporated and registered with the SEC. Accordingly, Marc Marketing, Inc.
was made non-operational. Alfredo continued to discharge his duties as General Manager but this
time under Mark II.
Mark II board of directors appointed Alfredo as one of its corporate officers with the
designation or title of General Manager to function as a managing director with other duties and
responsibilities that the Board of Directors may provide and authorized. On 30 June 1997, Mark II
decided to stop and cease its operations due to poor sales collection aggravated by the inefficient
management of its affairs. Feeling aggrieved, Alfredo filed a Complaint for Reinstatement and Money
Claim against Mark II and Lucila before the Labor Arbiter. The Labor Arbiter declared Alfredo’s
dismissal to be illegal. On appeal, the NLRC ruled in favor of Mark II and Lucila.
ISSUE:
Whether or not the RTC has jurisdiction over Alfredo’s dismissal.
RULING:
NO. In determining whether the RTC has jurisdiction over the controversy, the status or
relationship of the parties and the nature of the question that is the subject of their controversy must
be taken into consideration. Under Section 25 of the Corporation Code, a position must be expressly
mentioned in the by-laws in order to be considered as a corporate office. A careful perusal of Mark II’
by-laws, particularly paragraph 1, Section 1, Article IV, would explicitly reveal that its corporate
officers are composed only of: (1) Chairman; (2) President; (3) one or more Vice-President; (4)
Treasurer; and (5) Secretary. The position of General Manager was not among those enumerated.
Paragraph 2, Section 1, Article IV of Mark II by-laws, empowered its Board of Directors to

appoint such other officers as it may determine necessary or proper. It is by virtue of this enabling
provision that Mark II’s Board of Directors allegedly approved a resolution to make the position of
General Manager a corporate office, and, thereafter, appointed Alfredo thereto making him one of its
corporate officers. All of these acts were done without first amending its by-laws so as to include the
General Manager in its roster of corporate officers. With the given circumstances, Alfredo was not a
corporate officer of Mark II because his position as General Manager was not specifically mentioned
in the roster of corporate officers in its corporate by-laws.
That Alfredo was also a director and a stockholder of Mark II will not automatically make the
case fall within the ambit of intra-corporate controversy and be subjected to RTCs jurisdiction. To
reiterate, not all conflicts between the stockholders and the corporation are classified as intra-corporate. Other
factors such as the status or relationship of the parties and the nature of the question that is the subject
of the controversy must be considered in determining whether the dispute involves corporate matters so as
to regard them as intra-corporate controversies. As previously discussed, respondent was not a corporate
officer of Mark II but a mere employee thereof so there was no intra-corporate relationship between them.
With regard to the subject of Alfredo’s dismissal as Mark II’s General Manager, the same did not present or
relate to an intra-corporate dispute. To note, there was no evidence submitted to show that respondents
removal as petitioner corporations General Manager carried with it his removal as its director and
stockholder.
Doctrine of Separate Juridical Personality
HARPOON MARINE SERVICES, INC., et al. v. FERNAN H. FRANCISCO

G.R. No. 167751, 02 March 2011, THIRD DIVISION (Del Castillo, J.)
Obligations incurred by corporate officers are not theirs but the direct accountabilities of the
corporation they represent.
Harpoon Marine Service Inc. (Harpoon), a company engaged in ship building and ship repair,
with Rosit as its President and Chief Executive Officer (CEO), originally hired Fernan H. Francisco
(Francisco) in 1992 as its Yard Supervisor tasked to oversee and supervise all projects of the
company. In 1998, Francisco left for employment elsewhere but was rehired by Harpoon and
assumed his previous position a year after.
Francisco averred that he was unceremoniously dismissed by Rosit. He was informed that
the company could no longer afford his salary and that he would be paid his separation pay and
accrued commissions. Relying on the promise of Rosit, Francisco went to the office to receive his
separation pay and commissions, but Rosit offered only his separation pay. After several unheeded
requests, Francisco, through his counsel, sent a demand letter to Francisco asking for payment of
P70,000.00, which represents his commissions. Hence, Francisco filed an illegal dismissal complaint.
By way of defense, Harpoon averred that Francisco incurred excessive absences and
tardiness. Instead of improving his work behavior, Francisco continued to absent himself and sought
employment with another company engaged in the same line of business, thus, creating serious
damage in the form of unfinished projects. Harpoon denied having terminated Francisco as the latter
voluntarily abandoned his work after going on Absence Without Official Leave (AWOL).
The Labor Arbiter (LA) held that Francisco was validly dismissed due to his unjustified
absences and tardiness. The LA also held that Francisco was entitled to the payment of commissions.
Both parties appealed to the National Labor Relations Commission (NLRC). The NLRC found that
Francisco was illegally dismissed, and affirmed the LA’s finding that Francisco was entitled to the
payment of commissions. Harpoon elevated the case to the Court of Appeals (CA). The CA affirmed
the findings and conclusions of the NLRC. Hence, this petition.
ISSUES:
1. Whether or not Francisco was illegally dismissed.

2. Whether or not Rosit is liable for Francisco’s dismissal.
RULING:
1. YES. A scrutiny of the time card and payroll discloses that Francisco incurred only three
days of absence and no record of tardiness. As aptly held by the NLRC, the time card and payroll
presented by Harpoon do not show gross and habitual absenteeism and tardiness especially since
Francisco’s explanation of his three-day absence was not denied by Harpoon at the first instance
before the Labor Arbiter. No other evidence was presented to show the alleged absences and
tardiness. On the other hand, Solares, a coworker of Francisco has stated under oath that, as their
supervisor, Francisco was diligent in reporting for work when they heard the news concerning
Francisco’s termination from his job.
However, Francisco is not entitled to the payment of commissions. Examination of the check
vouchers presented by Francisco reveals that nothing in them provides that commissions were paid
to Francisco on account of a repair or construction of a vessel. At most, these vouchers only showed
that Francisco was paid on two occasions but were silent as to the specific purpose of payment.
2. NO. Rosit could not be held solidarily liable with Harpoon for lack of substantial evidence
of bad faith and malice on his part in terminating Francisco.
As held in the case of MAM Realty Development Corporation v. National Labor Relations
Commission, “obligations incurred by [corporate officers], acting as such corporate agents, are not
theirs but the direct accountabilities of the corporation they represent.” As such, they should not be
generally held jointly and solidarily liable with the corporation.
The general rule is grounded on the theory that a corporation has a legal personality separate
and distinct from the persons comprising it. To warrant the piercing of the veil of corporate fiction,
the officer’s bad faith or wrongdoing “must be established clearly and convincingly” as “[b]ad faith is
never presumed.”
In the case at bench, the CA’s basis for Rosit’s liability was that he acted in bad faith when he
approached Francisco and told him that the company could no longer afford his salary and that he
will be paid instead his separation pay and accrued commissions. This finding, however, could not
substantially justify the holding of any personal liability against Rosit. The records are bereft of any
other satisfactory evidence that Rosit acted in bad faith with gross or inexcusable negligence, or that
he acted outside the scope of his authority as company president. Indeed, Rosit informed Francisco
that the company wishes to terminate his services since it could no longer afford his salary. Moreover,
the promise of separation pay, according to Harpoon, was out of goodwill and magnanimity. At the
most, Rosit’s actuations only show the illegality of the manner of effecting Francisco’s termination
from service due to absence of just or valid cause and non-observance of procedural due process but
do not point to any malice or bad faith on his part. Besides, good faith is still presumed. In addition,
liability only attaches if the officer has assented to patently unlawful acts of the corporation.
Corporate Powers
MAJORITY STOCKHOLDERS OF RUBY INDUSTRIAL CORPORATION v. MIGUEL LIM

The validity of issuance of additional shares may be questioned if done in breach of trust by the
controlling stockholders.
Ruby Industrial Corporation is a domestic corporation engaged in glass manufacturing.

Reeling from severe liquidity problems beginning in 1980, Ruby filed on December 13, 1983 a
petition for suspension of payments with the SEC which was granted. The SEC Hearing Panel created
the management committee (MANCOM) for Ruby, composed of representatives from Ruby’s
creditors. Subsequently, two rehabilitation plans were submitted to the Securities and Regulations
Commission (SEC), the BENHAR/RUBY Rehabilitation Plan of the majority stockholders led by Yu
Kim Giang, and the Alternative Plan of the minority stockholders represented by Miguel Lim.
However, the implementation of both majority plans has been enjoined. Notwithstanding the
injunction order, SEC issued an Order approving the Revised BENHAR/RUBY Plan and creating a new
management committee to oversee its implementation.
The Revised BENHAR/RUBY Plan had proposed the calling for subscription of unissued
shares through a Board Resolution from the P11.814 million of theP23.7 million Authorized Capital
Stock (ACS) “in order to allow the long overdue program of the REHAB Program.” To implement the
Revised plan, RUBY’s board of directors held a special meeting and took up the capital infusion of
P11.814 Million representing the unissued and unsubscribed portion of the present ACS of P23.7
Million. The Board resolved that: The corporation be authorized to issue out of the unissued portion
of the authorized capital stocks of the corporation in the form of common stocks 11.8134.00 Million
to be subscribed and paid in full by the present stockholders in proportion to their present
stockholding in the corporation on staggered basis and that should any of the stockholders fail to
exercise their rights to buy the number of shares they are qualified to buy by making the first
installment payment of 25% on or before October 13, 1991, then the other stockholders may buy the
same and that only when none of the present stockholders are interested in the shares may there be
a resort to selling them by public auction. The minority directors claimed they were not notified of
said board meeting.
Consequently, Lim moved that the SEC declare as null and void the infusion of additional
capital made by the majority stockholders and restore the capital structure of RUBY to its original
structure prior to the time injunction was issued. Before the CA, Lim demonstrated the following
evidence to rebut the presumption of regularity: (1) it was the board of directors and not the
stockholders which conducted the meeting without the approval of the MANCOM; (2) there was no
written waivers of the minority stockholders’ pre-emptive rights and thus it was irregular to merely
notify them of the board of directors’ meeting and ask them to exercise their option; (3) there was an
existing permanent injunction against any additional capital infusion on the BENHAR/RUBY Plan,
while the CA and this Court both rejected the Revised BENHAR/RUBY Plan; (4) there was no General
Information Sheet reports made to the SEC on the alleged capital infusion, as per certification by the
SEC.
ISSUE:
Whether or not the additional capital infusion is valid.
RULING:
NO. The issuance of additional shares was done in breach of trust by the controlling
stockholders. Here, the majority sought to impose their will and, through fraudulent means, attempt
to siphon off Ruby’s valuable assets to the great prejudice of Ruby itself, as well as the minority
stockholders and the unsecured creditors.
A stock corporation is expressly granted the power to issue or sell stocks. The power to issue
shares of stock in a corporation is lodged in the board of directors and no stockholders’ meeting is
required to consider it because additional issuances of shares of stock do not need approval of the
stockholders. What is only required is the board resolution approving the additional issuance of
shares. The corporation shall also file the necessary application with the SEC to exempt these from
the registration requirements under the Revised Securities Act (now the Securities Regulation Code).
The SEC remained indifferent to the reliefs sought by the minority stockholders, saying that
the issue of the validity of the additional capital infusion was belatedly raised. Even assuming the
October 2, 1991 board meeting indeed took place, the SEC did nothing to ascertain whether indeed,
as the minority claimed: (1) the minority stockholders were not given notice as required and
reasonable time to exercise their pre-emptive rights; and (2) the capital infusion was not for the
purpose of rehabilitation but a mere ploy to divest the minority stockholders of their 40.172%
shareholding and reduce it to a mere 25.25%.
Pre-emptive right under Sec. 39 of the Corporation Code refers to the right of a stockholder
of a stock corporation to subscribe to all issues or disposition of shares of any class, in proportion to
their respective shareholdings. The right may be restricted or denied under the articles of
incorporation, and subject to certain exceptions and limitations. The stockholder must be given a
reasonable time within which to exercise their preemptive rights. Upon the expiration of said period,
any stockholder who has not exercised such right will be deemed to have waived it.
The validity of issuance of additional shares may be questioned if done in breach of trust by
the controlling stockholders. Thus, even if the pre-emptive right does not exist, either because the
issue comes within the exceptions in Section 39 or because it is denied or limited in the articles of
incorporation, an issue of shares may still be objectionable if the directors acted in breach of trust
and their primary purpose is to perpetuate or shift control of the corporation, or to “freeze out” the
minority interest. In this case, the following relevant observations should have signaled greater
circumspection on the part of the SEC -- upon the third and last remand to it pursuant to the January
20, 1998 Decision -- to demand transparency and accountability from the majority stockholders, in
view of the illegal assignments and objectionable features of the Revised BENHAR/RUBY Plan, as
found by the CA and as affirmed by the Supreme Court.
INTELLECTUAL PROPERTY LAW
Trademark
FREDCO MANUFACTURING CORPORATION v. PRESIDENT AND FELLOWS OF HARVARD

COLLEGE (HARVARD UNIVERSITY)
G.R. No. 185917, 1 June 2011, SECOND DIVISION (Carpio, J.)
A mark which is considered by the competent authority of the Philippines to be well-known

internationally and in the Philippines, whether or not it is registered here, cannot be registered by
another in the Philippines.
Fredco Manufacturing Corporation (Fredco), a corporation organized and existing in the

Philippines, filed a Petition for Cancellation of Registration No. 56561 before the Bureau of Legal
Affairs of the Intellectual Property Office (IPO) against President and Fellows of Harvard College
(Harvard University), a corporation organized and existing in Massachusetts, United States of
America.
Fredco alleged that Registration No. 56561 was issued to Harvard University in 1993 for the
mark Harvard Veritas Shield Symbol for several merchandise. Fredco alleged that the mark Harvard
was first used in the Philippines in 1982 by New York Garments Manufacturing & Export Co., Inc.
(New York Garments), a domestic corporation and Fredco’s predecessor-in-interest. In 1985, New
York Garments filed for trademark registration of the mark Harvard for goods under Class 25. The
application matured into a registration and a Certificate of Registration was issued in 1988.
Harvard University, on the other hand, alleged that it is the lawful owner of the name and
mark Harvard in numerous countries worldwide, including the Philippines. The name and mark
Harvard was adopted in 1639 as the name of Harvard College of Cambridge, Massachusetts, U.S.A.
The name and mark Harvard was allegedly used in commerce as early as 1872. Harvard University
is over 350 years old and is a highly regarded institution of higher learning in the United States and
throughout the world.
In 2002, Harvard University allegedly discovered Fredco’s website which advertises and
promotes the brand name Harvard Jeans USA without Harvard University’s consent. In 2004,
Harvard University filed an administrative complaint against Fredco before the IPO for trademark
infringement and/or unfair competition with damages.
The Bureau of Legal Affairs-IPO cancelled Harvard University’s registration of the mark
Harvard for goods under Class 25. But in an appeal to the IPO Director General, the decision was
reversed because Fredco failed to explain how New York Garments came up with the mark Harvard.
The Court of Appeals (CA) affirmed the decision.
ISSUES:
Whether or not Harvard’s Registration No. 56561 should be cancelled.
RULING:
NO. Fredco’s registration of the mark Harvard and its identification of origin as Cambridge,
Massachusetts falsely suggest that Fredco or its goods are connected with Harvard University, which
uses the same mark Harvard and is also located in Cambridge, Massachusetts.
Fredco’s registration of the mark Harvard should not have been allowed because Section 4(a)
of R.A. No. 166 prohibits the registration of a mark which may disparage or falsely suggest a
connection with persons, living or dead, institutions, beliefs, among others.
Fredco’s use of the mark Harvard, coupled with its claimed origin in Cambridge,
Massachusetts, obviously suggests a false connection with Harvard University. On this ground alone,
Fredco’s registration of the mark Harvard should have been disallowed.
Indisputably, Fredco does not have any affiliation or connection with Harvard University, or
even with Cambridge, Massachusetts. Fredco or its predecessor New York Garments was not
established in 1936, or in the U.S.A. as indicated by Fredco in its oblong logo. Fredco offered no
explanation to the Court of Appeals or to the IPO why it used the mark Harvard on its oblong logo
with the words Cambridge, Massachusetts, Established in 1936, and USA.
Harvard is the trade name of the world famous Harvard University, and it is also a trademark
of Harvard University. Under Article 8 of the Paris Convention, as well as Section 37 of R.A. No. 166,
Harvard University is entitled to protection in the Philippines of its trade name Harvard even without
registration of such trade name in the Philippines. This means that no educational entity in the
Philippines can use the trade name Harvard without the consent of Harvard University. Likewise, no
entity in the Philippines can claim, expressly or impliedly through the use of the name and mark
Harvard, that its products or services are authorized, approved, or licensed by, or sourced from,
Harvard University without the latters consent.
Section 123.1(e) of R.A. No. 8293 now categorically states that a mark which is considered by
the competent authority of the Philippines to be well-known internationally and in the Philippines,
whether or not it is registered here, cannot be registered by another in the Philippines. Section
123.1(e) does not require that the well-known mark be used in commerce in the Philippines but only
that it be well-known in the Philippines.
GEMMA ONG aka MARIA TERESA GEMMA CATACUTAN v. PEOPLE OF THE PHILIPPINES
GR No. 169440, 23 November 2011, FIRST DIVISION (Leonardo-De Castro, J.)
It is the element of likelihood of confusion that is the gravamen of trademark infringement.
On September 10, 1998, Jesse S. Lara, then Senior Investigator III at the Intellectual Property
Rights Unit of the Economic Intelligence and Investigation Bureau, Department of Finance, received
reliable information that counterfeit Marlboro cigarettes were being distributed and sold by two
Chinese nationals, Johnny Sia and Jessie Concepcion, in the areas of Tondo, Binondo, Sta. Cruz and
Quiapo, Manila. A buy-bust operation was conducted on the different sari-sari stores of Manila
located in Quiapo, Tondo, Sta. Cruz and Blumentritt areas and took samples of Marlboro cigarettes.
Initial examination made by Philip Morris, Inc. on those random sample purchases revealed that the
cigarettes were indeed fake products unauthorized by the company.
By virtue of a search warrant, they searched the house of one Jackson Ong who owns the
delivery truck delivering the fake cigarettes. Jackson Ong was not found within the premises of the
house but Gemma Ong, his common law spouse who was present therein. They found Marlboro
cigarettes stocked in several boxes containing fifty (50) reams inside each box. The RTC convicted
Gemma for Infringement under Section 155 in relation to Section 170 of Republic Act No. 8293 or the
Intellectual Property Code. On appeal, the Court of Appeals affirmed the conviction of Gemma.
ISSUE:
Whether or not Gemma’s guilt was proven beyond reasonable doubt
RULING:
YES. To establish trademark infringement, the following elements must be shown: (1) the
validity of plaintiff’s mark; (2) the plaintiff’s ownership of the mark; and (3) the use of the mark or
its colorable imitation by the alleged infringer results in likelihood of confusion. Of these, it is the
element of likelihood of confusion that is the gravamen of trademark infringement.
The prosecution was able to establish that the trademark Marlboro was not only valid for
being neither generic nor descriptive, it was also exclusively owned by PMPI, as evidenced by the
certificates of registration issued by the Intellectual Property Office of the Department of Trade and
Industry. Anent the element of confusion, both the RTC and the Court of Appeals have correctly held
that the counterfeit cigarettes seized from Gemma’s possession were intended to confuse and deceive
the public as to the origin of the cigarettes intended to be sold, as they not only bore PMPI’s mark,
but they were also packaged almost exactly as PMPI’s products.
SECURITIES AND REGULATION CODE
PHILIPPINE VETERANS BANK v. JUSTINA CALLANGAN, in her capacity as Director of the

Corporation Finance Department of the Securities and Exchange Commission and/or the
SECURITIES AND EXCHANGE COMMISSION
G.R. No. 191995, 3 August 2011, SECOND DIVISION (Brion, J.)
A public company, as contemplated by the SRC, is not limited to a company whose shares of stock
are publicly listed; even companies like the Bank, whose shares are offered only to a specific group of
people, are considered a public company, provided they meet the requirements enumerated under
Subsections 17.1 and 17.2 of the SRC and Rule 3(1)(m) of the Amended Implementing Rules and
Regulations of the SRC.
Justina F. Callangan (Callangan), the Director of the Corporation Finance Department of the
Securities and Exchange Commission (SEC), sent Philippine Veterans Bank (Bank) a letter informing
it that it qualifies as a public company under Section 17.2 of the Securities Regulation Code (SRC) in
relation with Rule 3(1)(m) of the Amended Implementing Rules and Regulations of the SRC. The Bank
is thus required to comply with the reportorial requirements set forth in Section 17.1 of the SRC.
The Bank responded by explaining that it should not be considered a public company because
it is a private company whose shares of stock are available only to a limited class or sector, i.e., to
World War II veterans, and not to the general public. Director Callangan rejected the Bank’s
explanation and assessed it a total penalty of One Million Nine Hundred Thirty-Seven Thousand Two
Hundred Sixty-Two and 80/100 Pesos (P1,937,262.80) for failing to comply with the SRC reportorial
requirements from 2001 to 2003. The Bank moved for the reconsideration of the assessment, but
Director Callangan denied the motion. The SEC En Banc also dismissed the Bank’s appeal for lack of
merit prompting the Bank to file a petition for review with the Court of Appeals (CA).
The CA dismissed the petition and affirmed the assailed SEC ruling, with the modification that
the assessment of the penalty be recomputed from May 31, 2004. The CA also denied the Bank’s
motion for reconsideration, opening the way for the Bank’s petition for review on certiorari filed with
the Supreme Court. The Supreme Court denied the Bank’s petition for failure to show any reversible
error in the assailed CA decision and resolution.
In its Motion for Reconsideration, the bank reiterates that it is not a public company subject
to the reportorial requirements under Section 17.1 of the SRC because its shares can be owned only
by a specific group of people, namely, World War II veterans and their widows, orphans and
compulsory heirs, and is not open to the investing public in general. The Bank also asks the Court to
take into consideration the financial impact to the cause of veteranism; compliance with the
reportorial requirements under the SRC, if the Bank would be considered a public company, would
compel the Bank to spend approximately P40 million just to reproduce and mail the Information
Statement to its 400,000 shareholders nationwide.
ISSUE:
Whether or not the Bank is a public company.
RULING:
YES. It is clear that a public company, as contemplated by the SRC, is not limited to a company
whose shares of stock are publicly listed; even companies like the Bank, whose shares are offered
only to a specific group of people, are considered a public company, provided they meet the
requirements enumerated under Subsections 17.1 and 17.2 of the SRC. We also cite Rule 3(1)(m) of
the Amended Implementing Rules and Regulations of the SRC, which defines a public company as any
corporation with a class of equity securities listed on an Exchange or with assets in excess of Fifty
Million Pesos (P50,000,000.00) and having two hundred (200) or more holders, at least two hundred
(200) of which are holding at least one hundred (100) shares of a class of its equity securities.
The records establish, and the Bank does not dispute, that the Bank has assets
exceeding P50,000,000.00 and has 395,998 shareholders. It is thus considered a public company that
must comply with the reportorial requirements set forth in Section 17.1 of the SRC.
Additionally, and contrary to the Banks claim, the Bank’s obligation to provide its
stockholders with copies of its annual report is actually for the benefit of the veterans-stockholders,
as it gives these stockholders access to information on the Banks financial status and operations,
resulting in greater transparency on the part of the Bank. While compliance with this requirement
will undoubtedly cost the Bank money, the benefit provided to the shareholders clearly outweighs
the expense. For many stockholders, these annual reports are the only means of keeping in touch
with the state of health of their investments; to them, these are invaluable and continuing links with
the Bank that immeasurably contribute to the transparency in public companies that the law
envisions.
CORPORATE REHABILITATION
LEONARDO S. UMALE, [deceased] represented by CLARISSA VICTORIA, JOHN LEO, GEORGE

LEONARD, KRISTINE, MARGUERITA ISABEL, and MICHELLE ANGELIQUE, ALL SURNAMED
UMALE v. ASB Realty Corp.
Being placed under corporate rehabilitation and having a receiver appointed to carry out the
rehabilitation plan do not ipso facto deprive a corporation and its corporate officers of the power to
recover its unlawfully detained property.
Amethyst Pearl Corp., owned by ASB Realty Corp., had a parcel of land in Pasig City which it
transferred in favor of ASB through a Deed of Assignment in Liquidation in 1996. Meanwhile, ASB
entered into a lease contract with Leonardo Umale over the same parcel of land for the period of
1999-2000. However, despite the expiration of the contract, Umale continued to possess the property
and pay rentals until 2003. ASB sent him a notice to terminate the contract, vacate the premises, and
demand to pay accrued rentals amounting to ₱1.2 M. When Umale failed to comply, ASB filed an
action for unlawful detainer against Umale before the Metropolitan Trial Court (MeTC).
Umale claims that the lease over the land was through a verbal agreement with Amethyst, not
ASB. He also challenged ASB Realty’s personality to recover the subject premises considering that
ASB Realty had been placed under receivership by the Securities and Exchange Commission (SEC)
and a rehabilitation receiver had been duly appointed. Under Section 14(s), Rule 4 of the
Administrative Memorandum No. 00-8-10SC, or the Interim Rules of Procedure on Corporate
Rehabilitation (Interim Rules), it is the rehabilitation receiver that has the power to take possession,
control and custody of the debtors assets. Since ASB Realty claims that it owns the subject premises,
it is its duly-appointed receiver that should sue to recover possession of the same.
ASB presented a written contract showing that it is indeed the lessor, not Amethyst.
The MeTC dismissed ASB’s complaint without prejudice, stating that ASB had no personality
because Amethyst was the real lessor since the signatories to the written lease contract were under
the name of Amethyst. The Regional Trial Court (RTC) reversed the decision and declared ASB as the
real lessor and that it did not lose its corporate personality, which included the power to sue, even if
it was under receivership. The Court of Appeals (CA) affirmed it in toto.
ISSUES:
Whether or not a corporate officer of ASB Realty (duly authorized by the Board of Directors)
can file suit to recover an unlawfully detained corporate property despite the fact that the
corporation had already been placed under rehabilitation.
RULING:
YES. Corporations, such as ASB Realty, are juridical entities that exist by operation of law. As
a creature of law, the powers and attributes of a corporation are those set out, expressly or impliedly,
in the law. Among the general powers granted by law to a corporation is the power to sue in its own
name. This power is granted to a duly-organized corporation, unless specifically revoked by another
law. The question becomes: Do the laws on corporate rehabilitation particularly PD 902-A, as
amended, and its corresponding rules of procedure forfeit the power to sue from the corporate
officers and Board of Directors?
Corporate rehabilitation is defined as the restoration of the debtor to a position of successful

operation and solvency, if it is shown that its continuance of operation is economically feasible and
its creditors can recover by way of the present value of payments projected in the plan more if the
corporation continues as a going concern than if it is immediately liquidated. It was first introduced
in the Philippine legal system through PD 902-A, as amended. The intention of the law is to effect a
feasible and viable rehabilitation by preserving a floundering business as a going concern, because
the assets of a business are often more valuable when so maintained than they would be when
liquidated. This concept of preserving the corporations business as a going concern while it is
undergoing rehabilitation is called debtor-in-possession or debtor-in-place. This means that the
debtor corporation (the corporation undergoing rehabilitation), through its Board of Directors and
corporate officers, remains in control of its business and properties, subject only to the monitoring
of the appointed rehabilitation receiver. The concept of debtor-in-possession, is carried out more
particularly in the SEC Rules, the rule that is relevant to the instant case. It states therein that the
interim rehabilitation receiver of the debtor corporation does not take over the control and
management of the debtor corporation. Likewise, the rehabilitation receiver that will replace the
interim receiver is tasked only to monitor the successful implementation of the rehabilitation plan.
There is nothing in the concept of corporate rehabilitation that would ipso facto deprive the Board of
Directors and corporate officers of a debtor corporation, such as ASB Realty, of control such that it
can no longer enforce its right to recover its property from an errant lessee.
To be sure, corporate rehabilitation imposes several restrictions on the debtor corporation.

The rules enumerate the prohibited corporate actions and transactions (most of which involve some
kind of disposition or encumbrance of the corporations assets) during the pendency of the
rehabilitation proceedings but none of which touch on the debtor corporations right to sue. The
implication therefore is that our concept of rehabilitation does not restrict this particular power, save
for the caveat that all its actions are monitored closely by the receiver, who can seek an annulment
of any prohibited or anomalous transaction or agreement entered into by the officers of the debtor
corporation.
ASIATRUST DEVELOPMENT BANK v. FIRST AIKKA DEVELOPMENT, INC. and UNIVAC
DEVELOPMENT, INC.
G.R. No. 179558, 11 June 2011, SECOND DIVISION (Nachura, J.)
The rehabilitation court must give the oppositor an opportunity to be heard despite the belated
filing of its opposition, because the determination of the true and correct amount due the oppositor is
important in assessing whether the corporation may be successfully rehabilitated
First Aikka Development, Inc. (FADI) and Univac Development, Inc. (UDI)–engaged in the
construction and development of infrastructure and other industrial and commercial projects–
availed of separate loan accommodations or credit lines with petitioner Asia Trust Development
Bank with an aggregate amount of P114 M. FADI and UDI religiously and faithfully complied with
their loan obligations, but during the Asian Financial Crisis, they could not pay their obligations in
cash. Thus, they negotiated with Asia Trust for different modes of payment and subsequently agreed
that FADI and UDI assign the receivables of their various contracts to sell involving the lots in the
residential subdivision projects they were developing, instead of paying in cash.
Nonetheless, Asia Trust insisted on collecting the loan per the loan documents. They claimed
that FADI and UDI were already in default and demanded the payment of P145,830,220.95, which
the latter denied because of the assignment of their receivables to Asia Trust.
In 2006, FADI and UDI filed a consolidated Petition for Corporate Rehabilitation with Prayer
for Suspension of Payments with the Regional Trial Court (RTC) of Baguio City. They alleged that they
were unable to pay their loan based on Asia Trust’s claim. Though they have sufficient assets to pay
their loan, FADI and UDI averred that they were not liquid. By way of rehabilitation, respondents also
sought the determination of the true and correct amount of their loan obligation with petitioner.
The RTC ordered Asia Trust to stay the enforcement of all claims whether for money or
otherwise and whether such enforcement is by court action or otherwise, against FADI and UDI, their
guarantors, and sureties not solidarily liable with the debtors. Asia Trust also belatedly filed its
opposition to the rehabilitation, which the RTC thus denied. The Court of Appeals (CA) affirmed the
decision.
ISSUES:
Whether or not Asia Trust’s opposition to the rehabilitation should be granted.
RULING:
YES. Corporate rehabilitation connotes the restoration of the debtor to a position of

successful operation and solvency, if it is shown that its continued operation is economically feasible
and its creditors can recover by way of the present value of payments projected in the rehabilitation
plan, more if the corporation continues as a going concern than if it is immediately liquidated.
Rehabilitation proceedings in our jurisdiction have equitable and rehabilitative purposes. On

the one hand, they attempt to provide for the efficient and equitable distribution of an insolvent
debtors remaining assets to its creditors; and on the other, to provide debtors with a fresh start by
relieving them of the weight of their outstanding debts and permitting them to reorganize their
affairs. The purpose of rehabilitation proceedings is to enable the company to gain a new Lease on
life and thereby allow creditors to be paid their claims from its earnings.
The determination of the true and correct amount due petitioner is important in assessing
whether FADI may be successfully rehabilitated. It is thus necessary that petitioner be given the
opportunity to be heard by the rehabilitation court. The court should admit petitioners comment on
or opposition to FADIs petition for rehabilitation and allow petitioner to participate in the
rehabilitation proceedings to determine if indeed FADI could maintain its corporate existence. A
remand of the case to the rehabilitation court is, therefore, imperative. To be sure, the successful
rehabilitation of a distressed corporation will benefit its debtors, creditors, employees, and the
economy in general.
BPI FAMILY SAVINGS BANK, INC v. PRYCE GASES, INC. INTERNATIONAL FINANCE
CORPORATION, and NEDERLANDSE FINANCIERINGS-MAATSCHAPPIJVOOR
ONTWIKKELINGSLANDEN N.V.
G.R. No. 188365, 29 June 2011, SECOND DIVISION (Carpio, J.)
Since a petition for corporate rehabilitation is considered as a special proceeding, a record on

appeal is required to perfect the appeal.
International Finance Corporation (IFC), an international organization and the Nederlandse

Financierings-Maatschappij Voor Ontwikkelingslanden N.V. (FMO), a Dutch development bank,
creditors of International Finance Corporation (IFC), filed a Petition for Rehabilitation with the
Regional Trial Court of Makati due to the failure of PGI to service its debts as well as the refusal of
PGIs parent company, the Pryce Corporation, to provide financial support to PGI. IFC and FMO
proposed a financial restructuring where PGI’s loan from BPI Family Savings Bank, Inc. (BFB) shall
be paid in ten years as it was a non-MTI creditor. BFB filed its Opposition and Motion With Leave to
Withdraw Notice of Appeal and Instead Be Allowed to File a Petition for Review. The Regional Trial
Court (RTC), Branch 138, dismissed BFB’s appeal. The RTC, Branch 138, ruled that the law clearly
states that in special proceedings, record on appeal is required to perfect the appeal. The court of
appeals affirmed stating that when BFB filed the notice of appeal, the rule in force was the Interim
Rules of Procedure on Corporate Rehabilitation which required the filing of a record on appeal.
ISSUE:
Whether or not a record on appeal is required to perfect the appeal.
RULING:
YES. Section 5 of the Interim Rules on Corporate Rehabilitation provides that the review of
any order or decision of the court or an appeal therefrom shall be in accordance with the Rules of
Court. Under A.M. No. 00-8-10-SC, a petition for corporate rehabilitation is considered a special
proceeding. Thus, the period of appeal provided in paragraph 19(b) of the Interim Rules Relative to
the Implementation of Batas Pambansa Blg. 129 for special proceedings shall apply, that is, the period
of appeal shall be 30 days since a record of appeal is required. Under Section 9, Rule 41 of the 1997
Rules of Civil Procedure, a party’s appeal by record on appeal is deemed perfected as to him with
respect to the subject matter thereof upon approval of the record on appeal filed in due time. In this
case, BFB did not perfect the appeal when it failed to file the record on appeal. The filing of the notice
of appeal on 3 November 2003 was not sufficient because at the time of its filing, the Rules required
the filing of the record on appeal and not merely a notice of appeal.
SIOCHI FISHERY ENTERPRISES, INC., JUN-JUN FISHING CORPORATION, DEDE FISHING

CORPORATION, BLUE CREST AQUA-FARMS, INC., and ILOILO PROPERTY VENTURES, INC. v.
BANK OF THE PHILIPPINE ISLANDS
G.R. No. 193872, 19 October 2011, SECOND DIVISION (Carpio, J.)
The rehabilitation plan is an indispensable requirement in corporate rehabilitation

proceedings.
Siochi Fishery Enterprises, Inc., Jun-Jun Fishing Corporation, Dede Fishing Corporation, Blue
Crest Aqua-Farms, Inc. and Iloilo Property Ventures, Inc. (Siochi Fishery et. al.) are domestic
corporations of the Siochi family. Siochi, et al. are engaged in various businesses and have
interlocking stockholders and directors. In the course of their business, Siochi et. al. borrowed from
Bank of the Philippine Islands (BPI) and from Ayala Life Assurance, Inc. total obligation amounted to
P85,362,262.05. Siochi et. al. filed with the RTC a petition for corporate rehabilitation and prayed
that the RTC (1) issue a stay order; (2) declare petitioners in a state of suspension of payments; (3)
approve petitioners proposed rehabilitation plan; and (4) appoint a rehabilitation receiver. The RTC
(1) stayed enforcement of all claims against Siochi, et al.; (2) prohibited them from disposing their
properties, except in the ordinary course of business; (3) prohibited them from paying their
obligations; (4) prohibited Siochi, et al’s suppliers from withholding supply of goods and services;
and (5) appointed Atty. Cesar C. Cruz (Atty. Cruz) as rehabilitation receiver. Further, RTC approved
Siochi, et al’s rehabilitation plan. On appeal, Court of Appeals set aside the RTC Decision.
ISSUE:
Whether or not the rehabilitation plan of Siochi, et al. be granted.
RULING:
NO. In the present case, RTC hastily approved the rehabilitation plan in the same order giving
due course to the petition. RTC failed to refer for evaluation the rehabilitation plan to the
rehabilitation receiver. Thus, the rehabilitation receiver was unable to submit his recommendations
and make modifications or revisions to the rehabilitation plan as necessary. Moreover, RTC denied
the rehabilitation receivers motion to issue an order directing Siochi et. al. and their creditors to
attend a meeting. The rehabilitation plan is an indispensable requirement in corporate rehabilitation
proceedings.
The Court notes that Siochi, et Al. failed to include a liquidation analysis in their rehabilitation
plan. Further, the Court notes that Siochi, et al. do not own all of the properties with a total estimated
value of P393,922,000. Some of the properties are owned by Ferdinand, Gerald and Jose Patrick
Siochi, and Mario Siochi, Jr. In Santos v. National Labor Relations Commission, the Court held that a
corporation is a juridical entity with legal personality separate and distinct from those acting for and
in its behalf and, in general, from the people comprising it. Incidentally, since the time of filing of the
petition for corporate rehabilitation, there has been no showing that Siochi, et al’s situation has
improved or that they have complied faithfully with the terms of the rehabilitation plan.
CONSUMER ACT
AOWA ELECTRONIC PHILIPPINES, INC v. DEPARTMENT OF TRADE AND INDUSTRY,

NATIONAL CAPITAL REGION
The Department of Trade and Industry (DTI) has the authority and mandate to act upon
complaints for violations of the Consumer Act. The DTI is tasked to protect the consumer against
deceptive, unfair, and unconscionable sales, acts, or practices
At least 273 complaints by different consumers from the year 2001 until 2007 were filed
against Aowa Electronic Philippines Inc. before the Department of Trade and Industry-National
Capital Region (DTI-NCR).
The cases complain of a common operation: Aowa’s representatives would approach a target
customer and informs the former that he/she has won a gift or is to receive some giveaways. When
the target customer expresses interest, Aowa’s representatives then verbally reveal that the same
can only be claimed or received upon purchase of an overpriced additional product, which are
represented to be of high quality. An initial gift is offered to the target customer, and upon acceptance,
the customer is invited to Aowa’s store. Then the customer is informed that he/she has qualified for
a raffle draw or contest, entitling them to claim an additional gift, which can also be received only
upon the purchase of additional products. While enticing the target customer to purchase the
additional product, Aowa’s representatives “gang up on customers.”
In case they are short of cash, customers are urged to use their credit card or to withdraw
from an Automated Teller Machine (ATM). There are even instances where Aowa’s representatives
accompany a customer to his/her residence, so the latter can produce their means of payment.
DTI-NCR filed a formal charge against AOWA for violation of Articles 50 and 52 of the
Consumer Act of the Philippines. The Adjudication Officer ruled that DTI-NCR had given prima facie
evidence that Aowa violated the Consumer Act. The DTI Appeals Committee and subsequently the
Court of Appeals (CA) affirmed such finding.
Before the Supreme Court (SC), Aowa denies that it committed fraud or deceit in violation of
the Consumer Act. Good faith must always be presumed. They postulate that like other companies,
its sales personnel are employed to convince potential customers to purchase the products they are
selling, inclusive of enthusiasm in sales talk and overzealousness, which cannot and should not be
considered as deceit.
ISSUE:
Whether or not Aowa violated the Consumer Act.
RULING:
YES. The DTI has the authority and the mandate to act upon the complaints filed against
Aowa. Article 2 of the Consumer Act clearly sets forth the policy of the State on consumer protection.
This policy is reiterated in Article 48 of the Consumer Act, which provides that the State shall
promote and encourage fair, honest and equitable relations among parties in consumer transactions
and protect the consumer against deceptive, unfair and unconscionable sales acts or practices. Verily,
as espoused by the OSG, the DTI validly invoked Article 159 of the Consumer Act in order to effectuate
this policy of the State by filing a formal charge against Aowa. It is indubitable that the DTI is tasked
to protect the consumer against deceptive, unfair, and unconscionable sales, acts, or practices, as
defined in Articles 50 and 52 of the Consumer Act.
It cannot be gainsaid that the DTI acted on the basis of about 273 consumer complaints
against Aowa, averring a common and viral scheme in carrying out its business to the prejudice of
consumers. Complaints filed by consumers residing not only within the NCR but also in the provinces
continued to be filed even after the formal charge and the issuance of the PMO.
In these trying times when fly-by-night establishments and syndicates proliferate all over the
country, lurking and waiting to prey on innocent consumers, and ganging up on them like a pack of
wolves with their sugar-coated sales talk and false representations disguised as overzealous
marketing strategies, it is the mandated duty of the Government, through its various agencies like the
DTI, to be wary and ready to protect each and every consumer. To allow or even tolerate the
marketing schemes such as these, under the pretext of promotional sales in contravention of the law
and its existing rules and regulations, would result in consumers being robbed in broad daylight of
their hard earned money. The Court shall not countenance these pernicious acts at the expense of
consumers.
BANK SECRECY LAW
RICARDO B. BANGAYAN v. RIZAL COMMERCIAL BANKING CORPORATION and PHILIP SARIA

G.R. No. 149193, 4 April 2011, THIRD DIVISION (Sereno, J.)
The bank’s purported disclosure of confidential information as regards his accounts, without
adducing further evidence, cannot be awarded any damages arising from an unsubstantiated and
unproved violation of the Bank Secrecy Act.
Ricardo Bangayan had a savings account and a current account–which had an automatic
transfer condition wherein checks issued by the depositor may be funded by any of the two accounts–
with one of the branches of Rizal Commercial Banking Corporation (RCBC).
In June 1992, Bangayan purportedly signed a Comprehensive Surety Agreement (CSA) with
RCBC in favor of nine corporations, wherein the funds in Bangayan’s accounts would be used as
security to guarantee any existing and future loan obligations these corporations may incur with
RCBC. Also in June 1992, RCBC gave letters of credit to four companies that Bangayan guaranteed for
the importation of PVC resin from Korea.
When the shipments from Korea arrived in September, the Bureau of Customs (BOC)
demanded from RCBC the remittance of import duties worth P13,265,225. The fourth letter of credit
was also negotiated in Korea shortly after, thus the Korea Exchange Bank claimed reimbursement
from RCBC.
All letters of credit were subject to investigation by the Customs Intelligence and
Investigation Service of the BOC. Philip Saria, Account Officer of RCBC Binondo Branch, signed and
executed a statement before the BOC, on the bank’s letters of credit. This prompted Bangayan to file
a complaint against RCBC, which he alleges had disclosed to a third party, the BOC, information
concerning the identity, nature, transaction and deposits including details of transaction related to
and pertaining to his deposits with the said bank, in violation of the Bank Secrecy Act.
The Regional Trial Court (RTC) dismissed the complaint because Bangayan did not introduce
evidence to substantiate his claim that RCBC shared any classified information, which the Court of
ISSUES:
Whether or not RCBC violated the Bank Secrecy Act.
RULING:
NO. Bangayan failed to identify which confidential information RCBC divulged before the BOC
that would make them liable under the said law. Section 2 of the Bank Secrecy Act provides:
All deposits of whatever nature with banks or banking institutions in the

Philippines including investments in bonds issued by the Government of the Philippines,
its political subdivisions and its instrumentalities, are hereby considered as of an
absolutely confidential nature and may not be examined, inquired or looked into by any
person, government official, bureau or office, except upon written permission of the
depositor, or in cases of impeachment, or upon order of a competent court in cases of
bribery or dereliction of duty of public officials, or in cases where the money deposited
or invested is the subject matter of the litigation.
Bangayan claims that Saria divulged confidential information through the Affidavit he
submitted to the BOC. However, nothing in Saria’s Affidavit before the BOC showed that details of
Bangayan’s bank accounts with RCBC was disclosed. If at all, Saria merely discussed his functions as
an account officer in RCBC and identified Bangayan as the one who had guaranteed the payment or
obligations of the importers under the Surety Agreement.
According to Bangayan, the responses of RCBC’s officers in relation to the BOC’s actions led
to unsavory news reports that disparaged Bangayan’s good character and reputation and exposed
him to public ridicule and contempt. However, as the appellate court correctly found, the humiliation
and embarrassment that Bangayan suffered in the business community was not brought about by the
alleged violation of the Bank Secrecy Act; it was due to the smuggling charges filed by the BOC which
found their way in the headlines of newspapers.
Both the trial and appellate courts correctly found that Bangayan did not satisfactorily
introduce evidence to substantiate his claim that defendant bank gave any classified information in
violation of the Bank Secrecy Act. Failing to adduce further evidence in the instant Petition with
respect to the banks purported disclosure of confidential information as regards his accounts,
Bangayan cannot be awarded any damages arising from an unsubstantiated and unproved violation
of the Bank Secrecy Act.
GOVERNMENT SERVICE INSURANCE SYSTEM v. THE HONORABLE 15TH DIVISION OF THE
COURT OF APPEALS and INDUSTRIAL BANK OF KOREA ET. AL.
For foreign currency deposits in the Philippines the applicable law is not Republic Act No. 1405
but Republic Act No. 6426 or the Bank Secrecy Law.
A surety bond was agreed with DOMSAT HOLDINGS, INC. as the principal and the GSIS as
administrator and the obliges are Land Bank of the Philippines, Tong Yang Merchant Bank, Industrial
Bank of Korea and First Merchant Banking Corporation collectively known as “The Banks” with the
loan granted to DOMSAT of US $ 11,000,000.00 to be used for the financing of the two-year lease of
a Russian Satellite from Intersputnik. Domsat failed to pay the loan and GSIS refused to comply with
its obligation reasoning that Domsat did not use the loan proceeds for the payment of rental for the
satellite. GSIS alleged that Domsat, with Westmont Bank (now United Overseas Bank) as the conduit,
transferred the U.S. $11 Million loan proceeds from the Industrial Bank of Korea to Citibank New
York account of Westmont Bank and from there to the Binondo Branch of Westmont Bank. The Banks
filed a complaint before the Regional Trial Court (RTC) of Makati against Domsat and GSIS.
GSIS requested for the issuance of a subpoena duces tecum to the custodian of records of
Westmont Bank to produce bank ledger covering the account of Domsat with the Westmont Bank
and other pertinent documents. The RTC issued the subpoena but nonetheless, the RTC then granted
the second motion for reconsideration by the Banks to quash the subpoena granted to GSIS. GSIS
assailed its case to the Court of Appeals and the CA partially granted it’s petition allowing it to look
into documents but not the bank ledger because the US $11,000,000.00 deposited by Domsat to
Westmont Bank is covered by R.A. 6426 or the Bank Secrecy Law.
ISSUE:
Whether or not the deposited US $ 11,000,000.00 by Domsat, Inc. to Westmont Bank is

covered by R.A. 6426.
RULING:
YES. R.A. 1405 was enacted on 1955 while R.A. 6426 was enacted on 1974. These two laws
both support the confidentiality of bank deposits. There is no conflict between them. Republic Act
No. 1405 was enacted for the purpose of giving encouragement to the people to deposit their money
in banking institutions and to discourage private hoarding so that the same may be properly utilized
by banks in authorized loans to assist in the economic development of the country. It covers all bank
deposits in the Philippines and no distinction was made between domestic and foreign deposits.
Thus, Republic Act No. 1405 is considered a law of general application. On the other hand, Republic
Act No. 6426 was intended to encourage deposits from foreign lenders and investors. It is a special
law designed especially for foreign currency deposits in the Philippines. A general law does not
nullify a specific or special law. Generaliaspecialibus non derogant. Therefore, it is beyond cavil that
Republic Act No. 6426 applies in this case. Since the accounts in question are U.S. dollar deposits, the
applicable law therefore is not Republic Act No. 1405 but Republic Act No. 6426.
CRIMINAL LAW
CRIMINAL LAW I
Proximate Cause
PEOPLE OF THE PHILIPPINES v. ORLITO VILLACORTA

G.R. No. 186412, 7 September 2011, FIRST DIVISION (Leonardo-De Castro, J.)
An accused cannot be held liable for murder if the stab wound inflicted on the victim was merely
the remote cause and its subsequent infection with tetanus might have been the proximate cause of
death.
Danilo Cruz (Cruz) and Orlito Villacorta (Villacorta) were regular customers at the store of
Cristina Mendeja (Mendeja). Mendeja narrated that on January 23, 2002, she was tending her sari-
sari store. At around two o’clock in the morning, while Cruz was ordering bread at Mendeja’s store,
Villacorta suddenly appeared and, without uttering a word, stabbed Cruz on the left side of Cruz’s
body using a sharpened bamboo stick. The bamboo stick broke and was left in Cruz’s body.
Immediately after the stabbing incident, Villacorta fled. Mendeja gave chase but failed to catch
Villacorta. When Mendeja returned to her store, she saw her neighbor Aron removing the broken
bamboo stick from Cruz’s body. Mendeja and Aron then brought Cruz to Tondo Medical Center.
Dr. Domingo Belandres, Jr. (Dr. Belandres) was Head of the Tetanus Department at the San
Lazaro Hospital. On the day of the stabbing incident, Cruz was brought to the Tondo Medical Center,
where he was treated as an out-patient. It was only on February 14, 2002 when Cruz was brought to
the San Lazaro Hospital, where he died the following day, on February 15, 2002. While admitting that
he did not personally treat Cruz, Dr. Belandres was able to determine, using Cruz’s medical chart and
diagnosis, that Cruz died of tetanus infection secondary to stab wound. The Regional Trial Court
(RTC) found Villacorta guilty of murder, qualified by treachery. Villacorta filed a notice of appeal. The
Court of Appeals promulgated its Decision affirming in toto the RTC judgment of conviction against
Villacorta.
ISSUE:
Whether Villacorta should only be held liable for slight physical injuries.
RULING:
YES. The proximate cause of Cruz’s death is the tetanus infection, and not the stab wound.
Proximate cause has been defined as that cause, which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the injury, and without which the result would
not have occurred. In this case, immediately after he was stabbed by Villacorta in the early morning
of January 23, 2002, Cruz was rushed to and treated as an out-patient at the Tondo Medical Center.
On February 14, 2002, Cruz was admitted to the San Lazaro Hospital for symptoms of severe tetanus
infection, where he died the following day, on February 15, 2002. The prosecution did not present
evidence of the emergency medical treatment Cruz received at the Tondo Medical Center, subsequent
visits by Cruz to Tondo Medical Center or any other hospital for follow-up medical treatment of his
stab wound, or Cruzs activities between January 23 to February 14, 2002.
The incubation period for tetanus infection and the length of time between the hacking incident and
the manifestation of severe tetanus infection created doubts in the mind of the Court that Javier
acquired the severe tetanus infection from the hacking incident. We explained in Urbano that: There
had been an interval of 22 days between the date of the stabbing and the date when Cruz was rushed
to San Lazaro Hospital, exhibiting symptoms of severe tetanus infection. If Cruz acquired severe
tetanus infection from the stabbing, then the symptoms would have appeared a lot sooner than 22
days later. As the Court noted in Urbano, severe tetanus infection has a short incubation period, less
than 14 days; and those that exhibit symptoms with two to three days from the injury, have one
hundred percent (100%) mortality. Ultimately, we can only deduce that Cruz’s stab wound was
merely the remote cause, and its subsequent infection with tetanus might have been the proximate
cause of Cruz's death. The infection of Cruzs stab wound by tetanus was an efficient intervening cause
later or between the time Cruz was stabbed to the time of his death.
JUSTIFYING CIRCUMSTANCES
Self-Defense
PEOPLE OF THE PHILIPPINES v. ROGELIO DOLORIDO y ESTRADA

G.R. No. 191721, 12 January 2011, FIRST DIVISION, (Velasco, Jr. J.)
Unlawful aggression must be proved first in order for self-defense to be successfully pleaded,
whether complete or incomplete.
Aniolito Avila and Adrian Avila (Avilas) were hired laborers of victim Daniel Estose (Estose),
tasked to harvest coconuts. The Avilas saw Dolorido hiding behind a coconut drier. When Estose
passed by the coconut drier, they saw Dolorido suddenly hacked Estose twice, resulting in wounds
on his arms. When Estose tried to retreat, he fell down and it was then that Dolorido stabbed him on
the left portion of his chest, which caused his death. Dolorido’s defense on the incident was that he
acted in self-defense. The Regional Trial Court (RTC) convicted Dolorido of the crime of murder
qualified by treachery. Upon appeal, the Court of Appeals affirmed the RTC judgment in toto.
ISSUES:
1. Whether or not Dolorido acted in self-defense

2. Whether or not there was treachery
RULING:
1. NO. In order for self-defense to be successfully invoked, the following essential elements
must be proved: (1) unlawful aggression on the part of the victim; (2) reasonable necessity of the
means employed to prevent or repel such aggression; and (3) lack of sufficient provocation on the
part of the person resorting to self-defense. A person who invokes self-defense has the burden of
proof of proving all the elements. However, the most important among all the elements is the element
of unlawful aggression. Unlawful aggression must be proved first in order for self-defense to be
successfully pleaded, whether complete or incomplete.
In this case, Dolorido failed to prove the existence of unlawful aggression. Threat it must be
offensive and strong, positively showing the wrongful intent to cause injury. It presupposes actual,
sudden, unexpected or imminent danger not merely threatening and intimidating action. It is present
only when the one attacked faces real and immediate threat to one’s life. Such is absent in the instant
case. The positive declaration of the Avilas proved that Dolorido hacked Estose twice and
subsequently stabbed him without any provocation.
2. YES. The essence of treachery is the sudden and unexpected attack by an aggressor on the
unsuspecting victim, depriving the latter of any chance to defend himself and thereby ensuring its
commission without risk of himself. In the case at bar, it was clearly shown that Estose was deprived
of any means to ward off the sudden and unexpected attack by Dolorido. Estose could only attempt
to parry the blows with his bare hands and as a result, he got wounded.
PEOPLE OF THE PHILIPPINES v. ANTONIO SABELLA y BRAGAIS

G.R. No. 183092, 30 May 2011, THIRD DIVISION, (Brion, J.)
The most important element in self-defense is unlawful aggression there can be no self-defense
unless the victim first committed unlawful aggression against the person who resorted to self-defense.
In the evening of September 28, 1998, Romulo Competente (Competente) was walking home
after talking to Prudencio Labides (Labides) at Marcos Verdeflor’s home. Along the way, Competente
encountered Antonio Sabella (Sabella) who suddenly hit him in the back with a bolo and threatened
to cut off his head if he did not go home. Feeling pain in his back due to the blow, Competente decided
to rest beside a nearby banana plant. Moments later, he saw Sabella stab Labides (who had just left
Marcos Verdeflor’s house) in the abdomen with a bolo about two (2) feet long. When Labides turned
away from Sabella, the latter stabbed Labides a second time in the back. Labides was declared dead
on arrival, when they arrived at the Bicol Medical Center in Naga City. Opposing the prosecution’s
allegation, Sabella claimed self-defense. The Regional Trial Court (RTC) found Sabella guilty of
murder. Upon appeal, the Court of Appeals affirmed the RTC Decision.
ISSUE:
Whether or not Sabella is guilty beyond reasonable doubt of the crime of murder
RULING:
YES. To escape liability, one who admits killing another in the name of self-defense bears the
burden of proving: (1) unlawful aggression on the part of the victim; (2) reasonable necessity of the
means employed to prevent or repel it; and (3) lack of sufficient provocation on the part of the person
claiming self-defense. In this case, Sabella miserably failed to prove unlawful aggression on the part
of Labides. There was no evidence to support the Sabella’s claim. In contrast, the physical evidence
belies the Sabella’s claim of self-defense. The number, location and severity of the hack wounds
Sabella inflicted on Labides all indicate an intention to kill, and not merely wound or defend.
Both the RTC and the CA correctly appreciated the qualifying circumstance of treachery. From
the established set of facts, Sabella’s attack on Labides was deliberate, sudden and unexpected; the
victim was unarmed and completely unaware of any impending danger to his life. The treachery
employed is all the more emphasized when we recall that Sabella stabbed the victim a second time
in the back, despite the lack of any resistance from Labides, and even after Labides had already been
stabbed in the stomach. Under the circumstances, the RTC and the CA correctly sentenced the
appellant to suffer the penalty of reclusion perpetua, regardless of the presence of the mitigating
circumstance of voluntary surrender.
PEOPLE OF THE PHILIPPINES v. ANGELITO ESQUIBEL y JESUS

G.R. No. 192465, June 8, 2011, SECOND DIVISION (Carpio, J.)
Self-defense, to be successfully invoked, must be established with certainty and proved with
sufficient satisfactory and convincing evidence that excludes any vestige of criminal aggression on the
part of the person invoking it.
In this case, the Prosecution alleged that Clark Baloloy (Baloloy) and his parents were
watching television at home. After eating dinner, Baloloy went outside the house to wash his hands,
as well as Maricel Gaboy (Gaboy). Angelito Esquibel (Esquibel), their neighbor, saw Baloloy washing
his hands and suddenly approached and stabbed him on the right side if the stomach with a knife,
then he ran away. Baloloy managed to go back inside the house and before collapsing, he told his
parents that it was Esquibel (referred to as “Butchoy”) who stabbed him. Baloloy then died. During
the trial, his parents and Gaboy positively identified Esquibel as the one Baloloy referred to as
Butchoy. The defense, on the other hand, presented Esquibel as the lone witness and invoked self-
defense. He testified that he was on a drinking spree with friends, including Baloloy. Baloloy
suddently told Esquibel in an angry tone that he will attack him, and Esquible referred to a previous
incident where Baloloy stabbed his brother. After leaving the party, Esquibel passed by Baloloy’s
house and heard Gaboy telling Baloloy that he was already there. Then Baloloy suddenly appeared
carrying a knife and lunged at him. Esquibel then use the knife to stab Baloy and fleed from the scene.
Esquibel was charged with and convicted of the crime of murder qualified by treachery under Article
248 of the Revised Penal Code. The same was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not Esquibel is guilty of the crime of murder.
RULING:
YES. First, self-defense, to be successfully invoked, must be established with certainty and
proved with sufficient satisfactory and convincing evidence that excludes any vestige of criminal
aggression on the part of the person invoking it. By invoking self-defense, the burden of evidence
shifts to appellant to show that the killing was justified and that he incurred no criminal liability. In
this case, Esquibel’s testimony was not only uncorroborated but also extremely doubtful. He merely
pointed to alleged inconsistencies in Gaboy’s testimony and to the alleged failure of Gaboy to
positively identify him since there was no light in front of the victim’s house where she was sitting.
These allegations by Esquibel were not substantiated by clear and convincing evidence. His
testimony is self-serving and deserves no weight in law over the positive and credible testimonies of
the prosecution’s witnesses, particularly Gaboy as she was candid, straightforward, firm and
unwavering in her narration of the events.
Second, there the lower courts correctly appreciated treachery as a qualifying circumstance.
The essence of treachery is the sudden and unexpected attack on an unsuspecting victim by the
perpetrator of the crime, depriving the victim of any chance to defend himself or repel the aggression,
thus, insuring its commission without risk to the aggressor and without any provocation on the part
of the victim. The sudden attack by Esquibel with a bladed weapon, with Baloloy’s back against him,
was undoubtedly treacherous. Baloloy was washing his hands outside his house when Esquibel
appeared out of nowhere and stabbed him. Baloloy was unprepared and had no means to put up a
defense. Such aggression insured the commission of the crime without risk on Esquibel.
PEOPLE OF THE PHILIPPINES v. BINGKY CAMPOS and DANNY BOY ACABO

There can be no self-defense unless there was unlawful aggression from the person injured or
killed by the accused; for otherwise, there is nothing to prevent or repel.
Bingky Campos (Bingky) and Danny Boy Acabo (Danny) were charged with the murder of
Romeo Abad (Romeo). The prosecution witness narrated that Romeo was just buying cigarettes and
candies in a store when Bingky and Danny ran towards Romeo. Danny stabbed Romeo at the lower
right side of the latter’s abdomen with a plamingko while Bingky stood nearby. Immediately after
stabbing Romeo, Danny and Bingky fled. According to the defense, while on their way to the house
of their uncle, Danny and Bingky met four men who mauled Bingky. When Bingky was able to run
away, they approached Danny and kicked his buttocks. Danny pulled out a knife and thrust it towards
one of the men. Danny then ran away to escape. Both the Regional Trial Court and the Court of
Appeals convicted the two accused with the crime charged. Danny and Bingky raised the justifying
circumstance of self-defense.
ISSUE:
Whether or not the stabbing of the victim was done in self-defense.
RULING:
NO. As can be gleaned from Danny’s testimony, there is no mention at all that Romeo was
among the four persons who allegedly attacked Danny and Bingky. Likewise, there is nothing in the
narration which evinces unlawful aggression from Romeo. Danny’s testimony shows that there was
only an attempt, not by Romeo but by Jaime and Iko, to attack him. Following his version, Danny then
became the aggressor and not the victim. Even if the version of Danny is given a semblance of truth,
that there was an attempt to hurt him, though intimidating, the same cannot be said to pose danger
to his life and limb. This conclusion was drawn from the fact that no bladed weapon was found at the
alleged scene of the crime and nobody testified about it.
For unlawful aggression to be appreciated, there must be an actual, sudden and unexpected
attack, or imminent danger thereof, not merely a threatening or intimidating attitude and the accused
must present proof of positively strong act of real aggression. For this reason, Danny’s observation
that one of the men was pulling an object from his waist is not a convincing proof of unlawful
aggression. A threat, even if made with a weapon or the belief that a person was about to be attacked,
is not sufficient. An intimidating or threatening attitude is by no means enough. In this case, other
than the self-serving allegation of Danny, there is no evidence sufficiently clear and convincing that
the victim indeed attacked him. Where no unlawful aggression is proved, no self-defense may be
successfully pleaded.
PEOPLE OF THE PHILIPPINES v. DAVID MANINGDING
G.R. No. 195665, 14 September 2011, THIRD DIVISION (Velasco, J.)
When an accused claims the justifying circumstance of self-defense, an accused admits the
commission of the act of killing. The burden of evidence, therefore, shifts to the accused’s side in clearly
and convincingly proving that the elements of self-defense exist that could justify the accused’s act.
Aladino Jorge (Aladino) is the owner of a sari-sari store and a videoke where the incident
happened. He testified that on September 13, 2006, at about 10:25 in the evening, while he was
tending to his sari-sari store, he noticed brothers Rommel Muyalde (Rommel) and Marlon Muyalde
(Marlon) conversing with each other, while seated on a bench beside his store. While this was
transpiring, David Maningding (Maningding) arrived. Marlon stood up and greeted Maningding, who
happened to be his brother-in-law. He stated that Maningding kept quiet and suddenly raised the
right hand of Marlon and stabbed him by the armpit with a knife that he was carrying. Marlon shouted
because of the pain, which caused the people in the neighborhood to come out. At this instance,
Maningding ran away. Aladino testified that he was only about one meter away from the incident’s
site as it was just right beside his sari-sari store.
The prosecution’s another witness, Rommel, testified that he is the brother of Marlon and the
brother-in-law of the Maningding. He corroborated Aladino’s testimony and stated that while Marlon
and a neighbor, Mandy Molina (Molina), were in front of Aladinos store, singing with the videoke,
Maningding arrived whom they both greeted the a but the latter did not respond. Maningding, which
apparently was armed with a knife, suddenly got hold of the victim’s right hand, raised it and made a
thrust with his left hand. He then pulled the knife and ran away. As a defense, Maningding stated that
he was on his way home from carrying passengers with his tricycle when he saw the victim with four
other people at the sari-sari store of Aladino, having a drinking spree. He stated that the victim
actually called for him and invited him for a drink, which he refused. According to Maningding, the
victim then embraced him by extending his arm to his shoulder. He testified that at this instant, he
noticed that the victim was pulling a knife from his waist with his right hand, which he was able to
grab. As he was being embraced by the victim at such time and since they both fell thereafter, he did
not know that he was actually able to stab the victim. When he saw blood coming out of the victim,
he ran away out of fear. No other witness or evidence was presented by the defense for its case. After
trial, the Regional Trial Court (RTC) convicted Maningding of the crime of murder. Maningding
appealed but the Court of Appeals affirmed the judgment of the trial court.
ISSUE:
1. Whether or not the stabbing incident is justified as Maningding only acted in self-defense.
2. Whether or not treachery existed in the case.
RULING:
1. NO. In this case, considering that at the outset, accused-appellant has already maintained
a claim of self-defense, the burden of evidence rests upon him in proving his act of stabbing as
justifiable under the circumstances. According to Article 11 of the Revised Penal Code, any person
who acts in defense of his person or rights do not incur any criminal liability provided that the
following requisites concur: (1) unlawful aggression; (2) reasonable necessity of the means
employed to prevent or repel it; and (3) lack of sufficient provocation on the part of the person
defending himself. Conversely, the accused must be able to establish that all three circumstances
concur in order for the accused’s act to be justified under the law.
In this case, the records would show that accused-appellant was clearly not able to establish
the aforementioned requisites. Worse, his sole evidence his own testimony was found by the RTC to
be so weak and devoid of any credibility as against those presented by the prosecution. From the
facts of the present case, the RTC gave credence and weight to the evidence presented by the
prosecution, whose testimonies rule out accused-appellants claim of self-defense. As earlier
explicated, We do not disturb or interfere with the findings of fact of the RTC unless there is a clear
showing of mistake or a grave abuse of discretion. From the testimonies of Rommel and Aladino,
there was no unlawful aggression on the part of the victim. If there was any, it came from accused-
appellant himself for having unsuspectingly attacked the victim, who was peacefully engaged in a
conversation with Rommel during the stabbing incident.
2. YES. In this case, it is undisputed that it was accused-appellant who stabbed and killed the
victim, which is neither a crime of parricide nor infanticide. We are, therefore, left with the issue of
whether there was treachery in the attack. Going over the records of the case, We are convinced that,
indeed, treachery was employed and present in the stabbing by accused-appellant of the victim,
which led to the latter’s ultimate death. From the testimonies of Aladino and Rommel, it cannot be
gainsaid that accused-appellant without any warning or suspicion, and taking advantage of the
circumstances, immediately attacked the victim. The victim did not have any suspicion that could
have alerted him of the impending attack. As clearly demonstrated in the trial court, the attack was
swift and unexpected, even to the eyewitnesses, Aladino and Rommel.
PEOPLE OF THE PHILIPPINES v. EDGAR CONCILLADO

When an accused admits the commission of the crime but claims the justifying circumstance of
self-defense, the burden of proof is shifted to him. When the accused miserably fails to discharge his
burden, he does not deserve an acquittal. His conviction must be sustained.
Edgar Concillado (Edgar), Erlito Concillado (Erlito) and Dolores Concillado (Dolores) were
charged with the murder of Diosdado Pido (Diosdado). The prosecution witness, Lorenzo Vias
(Lorenzo), testified that he and Diosdado attended a fiesta and when they parted ways, he saw Edgar
shoot Diosdado using a surit-surit (homemade gun). When Diosdado fell to the ground, Edgar,
Dolores and Erlito approached the victim and simultaneously stabbed him using small and long bolos.
Edgar admitted that he was the one who inflicted all the 26 wounds on the victim but claimed that he
was only acting in self-defense. He claimed that he and his wife Dolores just came home from a
drinking spree. His wife Dolores went to bed as she had a fever. Edgar urinated near their fence
when Diosdado suddenly appeared and challenged him to a fight. Diosdado immediately stabbed
him, but Edgar was able to take his surit and fired at Diosdado who continued on hacking him. Edgar
was able to parry the blows coming from Diosdado as he was able to grab a long bolo immediately
after he fired his gun. Edgar and Diosdado kept on exchanging blows until they were already outside
the former’s gate. Diosdado said that his brother Erlito was attending a fiesta when the incident
happened.
The Regional Trial Court (RTC) convicted the three accused as charged. However, the Court
of Appeals (CA) acquitted Erlito and Dolores of the crime charged and found Edgar guilty only of
homicide. The CA held that Lorenzo could not have seen Dolores stab Diosdado as Lorenzo arrived
at the crime scene only after the crime had been consummated. As regards Edgar who admitted the
killing, the CA was not convinced of his self-defense theory. However, for lack of evidence to establish
the qualifying circumstances of treachery and evident premeditation, the CA convicted Edgar only of
the crime of homicide.
ISSUE:
Whether or not Edgar was able to prove his claim of self-defense.
RULING:
NO. Unlawful aggression must be proved first in order for self-defense to be successfully
pleaded, whether complete or incomplete. There can be no self-defense unless there was unlawful
aggression from the person injured or killed by the accused; for otherwise, there is nothing to prevent
or repel. Unlawful aggression is an actual physical assault, or at least a threat to inflict real imminent
injury, upon a person. The Court subscribes to the findings of both the trial court and the CA that
there is no unlawful aggression on the part of Diosdado. According to the trial court, the distance of
the accused from the fence while he was urinating was about 1 meter, while the victim was outside
and in-between them was a bamboo fence about four feet high. With the height of the fence and his
distance from the fence, there is an impossibility of unlawful aggression on the part of the victim. It
also concluded that the victim could not have entered the yard of the accused. The dead body of
Diosdado was found lying on the road about eight meters from the house of Edgar. However, no
traces of blood could be found in the yard of the accused.
The Court also agrees with the ruling of the CA that the disparity of the injuries sustained
belies all pretensions of self-defense. Diosdado suffered a total of 26 incised, stab and bullet wounds.
On the other hand, Edgar suffered only three superficial wounds. As has been repeatedly ruled, the
nature, number and location of the wounds sustained by the victim disprove a plea of self-defense.
Moreover, during his cross-examination, Edgar admitted that he continued to inflict injuries on
Diosdado notwithstanding the fact that he was already lying lifeless on the ground. There being no
unlawful aggression to speak of, Edgar’s theory of self-defense has no leg to stand on. Having
miserably failed to discharge his burden of proof, the Court therefore finds Edgar criminally
responsible for the death of Diosdado.
PEOPLE OF THE PHILIPPINES v. LINO L. DUAVIS

G.R. No. 190861, 7 December 2011, THIRD DIVISION (Peralta, J.)
Absent the essential element of unlawful aggression, there is no self-defense.
Dante Largado, Sr. (Largado, Sr.) was just walking towards the direction of his house when
Lino Duavis (Duavis) hacked him with a bolo, hitting him on the face, leaving a wound so severe that
he immediately fell to the ground and caused his instantaneous death. An Information for the crime
of murder was then filed against Duavis. It appears that there was an altercation between the two.
They chased one another with a bolo. Duavis, invoking self-defense, claimed that there was unlawful
aggression on the part of Largado, Sr. when he hid behind a coconut tree then hacked Duavis which
the latter was able to evade. The Regional Trial Court (RTC) convicted Duavis of the crime of murder.
The Court of Appeals (CA), finding that the RTC erred in appreciating the qualifying circumstance of
evident premeditation, ruled that Duavis is guilty of the crime of homicide instead of murder.
ISSUE:
1. Whether or not all the elements of self-defense are present in this case.
2. Whether or not Duavis should be convicted of homicide, not murder.
RULING:
1. NO. It is a hornbook doctrine that when self-defense is invoked, the burden of evidence
shifts to the appellant to prove the elements of that claim, i.e., (1) unlawful aggression on the part of
the victim, (2) reasonable necessity of the means employed to prevent or repel it, and (3) lack of
sufficient provocation on the part of the person defending himself. But absent the essential element
of unlawful aggression, there is no self-defense. In the present case, Duavis failed to prove the
presence of unlawful aggression on the part of the victim. As correctly observed and ruled by the
trial court, the unarmed victim was being chased by the accused, armed with a long bolo, and upon
catching up with the victim, the accused hacked the victim, hitting him on the left side of his face and
ear, cutting major blood vessels, which caused the death of the victim instantaneously. Clearly, the
element of unlawful aggression on the part of the victim is wanting.
2. YES. In finding that Duavis is guilty of homicide, instead of murder, the CA ruled that there
was an absence of the qualifying circumstances of evident premeditation and treachery. The essence
of evident premeditation is that the execution of the criminal act must be preceded by cool thought
and reflection upon the resolution to carry out the criminal intent during a space of time sufficient to
arrive at a calm judgment. For it to be appreciated, the following must be proven beyond reasonable
doubt: (1) the time when the accused determined to commit the crime; (2) an act manifestly
indicating that the accused clung to his determination; and (3) sufficient lapse of time between such
determination and execution to allow him to reflect upon the circumstances of his act. On the other
hand, to appreciate treachery, two (2) conditions must be present, namely, (a) the employment of
means of execution that gives the person attacked no opportunity to defend himself or to retaliate,
and (b) the means of execution were deliberately or consciously adopted. The CA, therefore, did not
err when it ruled that the killing of the victim was neither attended by evident premeditation nor
treachery.
MITIGATING CIRCUMSTANCES
Incomplete Self-Defense
PEOPLE OF THE PHILIPPINES v. ALLAN GABRINO

G.R. No. 189981, 9 March 2011, FIRST DIVISION, (Velasco, Jr., J.)
In order that incomplete self-defense could prosper as a privileged mitigating circumstance,

unlawful aggression must exist.
On the 30th day of December, 1993 in the Municipality of La Paz, Province of Leyte, Allan
Gabrino (Gabrino) attacked and wounded one Joseph Belano (Belano) with the use of bladed weapon
locally known as pisaw which Gabrino had purposely provided himself. As a result, Belano sustained
wounds on his body which caused his death shortly thereafter. Two witnesses, Bartolome Custodio
(Custodio) and Ismael Moreto (Moreto), positively identified Gabrino as the assailant during the
night Balano was stabbed. Gabrino’s version of facts however, on the night the crime happened was,
he went outside of the house to urinate when Tap-ing threw a stone at him, which hit him on the
forehead and caused him to fall down. And when he saw Balano rushing towards him with an ice pick,
he immediately stabbed him and then ran away. After trial, the Regional Trial Court (RTC) convicted
the accused for the murder of Balano. The Court of Appeals (CA) affirmed the judgment of the RTC in
toto.
ISSUES:
1. Whether or not the qualifying circumstance of treachery should be appreciated.

2. Whether or not the accused is entitled to a mitigating circumstance of incomplete self-
defense.
HELD:
1. YES. Treachery was committed by accused-appellant. In this case, it is undoubted that

accused-appellant was the person who stabbed Balano and caused his death. And this killing is
neither parricide nor infanticide. The question, therefore, to be resolved in this case is whether the
killing was attended by treachery that would justify accused-appellant’s conviction of murder.
Treachery exists when "the offender commits any of the crimes against persons, employing means,
methods, or forms in the execution, which tend directly and specially to insure its execution, without
risk to the offender arising from the defense which the offended party might make." What is
important in ascertaining the existence of treachery is the fact that the attack was made swiftly,
deliberately, unexpectedly, and without a warning, thus affording the unsuspecting victim no chance
to resist or escape the attack. In People v. Lobino, The Court held that a sudden attack against an
unarmed victim constitutes treachery. In this case, it is clear accused-appellant employed treachery
in stabbing and killing Balano.
2. NO. Incomplete self-defense cannot be made as a mitigating circumstance because the

element of unlawful aggression is absent. In order that incomplete self-defense could prosper as a
privileged mitigating circumstance, unlawful aggression must exist. In People v. Manulit, People v.
Mortera, and Mendoza v. People, the Court reiterated the well-settled rule that unlawful aggression
is an indispensable requisite in appreciating an incomplete self-defense. It is any one of the two other
elements of self-defense that could be wanting in an incomplete self-defense, i.e., reasonable
necessity of the means to employed to prevent or repel it; or lack of sufficient provocation on the part
of the person defending himself; but it can never be unlawful aggression. In this case, accused-
appellant failed to demonstrate the existence of unlawful aggression that would warrant an
incomplete self-defense.
Lack of Intent to Commit So Grave a Wrong
PEOPLE OF THE PHILIPPINES v. NOEL T. SALES

The mitigating circumstance of lack of intent to commit so grave a wrong as that actually
perpetrated cannot be appreciated where the acts employed by the accused were reasonably sufficient
to produce and did actually produce the death of the victim.
Noemar and Junior, 9 and 8 years old, respectively, left their home to attend the procession
of Our Lady of Peafrancia without the permission of their parents. They did not return home that
night. When their mother, Maria Litan Sales, looked for them the next day, she found them in the
nearby Barangay of Magsaysay. For fear that they would be punished, Noemar and Junior refused to
return home but was finally convinced by Maria. Upon reaching home, Noel Sales, their father,
confronted them and therafter proceeded to whip them with a stick. Sales tied Noemar’s and Junior’s
hands and feet to a coconut tree and continued to beat them with a thick piece of wood. When the
beating finally stopped, the three walked back to the house. Maria noticed a crack in Noemar’s head
and injuries in his legs while Junior had injuries in the right portion of the head, the left cheek, and
legs. Shortly thereafter, Noemar collapsed and lost consciousness. Maria tried to revive him and
when Noemar remained motionless despite her efforts.
Noel Sales was charged with the crimes of Parricide and Slight Physical Injuries. Sales denied
the allegations and claimed that the death of Noemar was due to his weak heart; that Noemar
complained of breathing difficulties only after Noemar was being whipped and not after; and that
Noemar suffered seizures due to epilepsy. The Regional Trial Court and Court of Appeals convicted
Sales of the offenses charged.
ISSUEs:
1. Whether or not Sales was guilty of Parricide.

2. Whether or not the mitigating circumstance of intention to commit so grave a wrong.
RULING:
1. YES. Prior to whipping his sons, Sales was already furious with them because they left the
family dwelling without permission and that was already preceded by three other similar
incidents. This was further aggravated by a report that his sons stole a pedicab thereby putting him
in disgrace. Moreover, they have no money so much so that he still had to borrow so that his wife
could look for the children and bring them home. From these, it is therefore clear that Sales was
motivated not by an honest desire to discipline the children for their misdeeds but by an evil intent
of venting his anger. This can reasonably be concluded from the injuries of Noemar in his head, face
and legs. It was only when Noemar’s body slipped from the coconut tree to which he was tied and
lost consciousness that appellant stopped the beating. Had not Noemar lost consciousness, Sales
would most likely not have ceased from his sadistic act. His subsequent attempt to seek medical
attention for Noemar as an act of repentance was nevertheless too late to save the child’s life. It bears
stressing that a decent and responsible parent would never subject a minor child to sadistic
punishment in the guise of discipline.
Sales attempts to evade criminal culpability by arguing that he merely intended to discipline
Noemar and not to kill him. In order that a person may be criminally liable for a felony different from
that which he intended to commit, it is indispensible (a) that a felony was committed and (b) that the
wrong done to the aggrieved person be the direct consequence of the crime committed by the
perpetrator. Here, there is no doubt Sales in beating his son Noemar and inflicting upon him physical
injuries, committed a felony. As a direct consequence of the beating suffered by the child, he expired.
Sales’ criminal liability for the death of his son, Noemar, is thus clear.
All the elements of the crime of parricide are present in this case. In the case at bench, there
is overwhelming evidence to prove the first element, that is, a person was killed. There is likewise no
doubt as to the existence of the second element that the Sales killed the deceased. Same is sufficiently
established by the positive testimonies of Maria and Junior. As to the third element, Sales himself
admitted that the deceased is his child. While Noemar’s birth certificate was not presented, oral
evidence of filial relationship may be considered.
2. NO. There was error in appreciating the mitigating circumstance of lack of intention to
commit so grave a wrong. Sales adopted means to ensure the success of the savage battering of his
sons. He tied their wrists to a coconut tree to prevent their escape while they were battered with a
stick to inflict as much pain as possible. Noemar suffered injuries in his face, head and legs that
immediately caused his death. The mitigating circumstance of lack of intent to commit so grave a
wrong as that actually perpetrated cannot be appreciated where the acts employed by the accused
were reasonably sufficient to produce and did actually produce the death of the victim.
Voluntary Surrender
PEOPLE OF THE PHILIPPINES v. REX NIMUAN y CACHO

The mitigating circumstance of voluntary surrender cannot be appreciated when the accused
did not intend to assume responsibility for the crime when he went with the apprehending officers.
Eyewitness Alfredo Ruiz (Alfred) saw Rex Nimuan (Nimuan), a certain Boy Nieva, and the
victim Jun Ruiz (Jun) having a drinking session at a neighborhood store. Later that afternoon, Alfredo
was walking home along a path in a mango plantation. He saw Jun and Nimuan ahead of him. Unaware
of Alfredo’s presence, Nimuan hacked Jun with his bolo. Alfredo immediately ran away to call for help.
Jun died soon after due to massive loss of blood caused by the hacking according to the postmortem
report. Nimuan interposed his alibi that he was watching TV in his uncle’s house when barangay
officials came to apprehend him for Jun’s murder. Consequently, Nimuan and his mother went with
the barangay officials to the police station of Aringay, La Union, where he was detained. The Regional
Trial Court (RTC) convicted Nimuan of murder. The RTC considered the qualifying circumstance of
treachery because Nimuan hacked Jun by surprise, but it also considered the mitigating circumstance
of voluntary surrender. The Court of Appeals (CA) affirmed the decision as to the crime and the
qualifying circumstance of treachery, but declared that the mitigating circumstance was erroneous
because Nimuan went with the barangay officials not to admit the alleged crime or to voluntarily
surrender to the authorities, but only for verification purposes.
ISSUE:
Whether or not the mitigating circumstance of voluntary surrender can be appreciated
RULING:
NO. The records are replete with evidence establishing Nimuan's guilt beyond reasonable
doubt. Alfredo’s eyewitness account was corroborated by the postmortem report on the location and
severity of the wounds sustained by the victim. Both the RTC and the CA correctly appreciated the
qualifying circumstance of treachery because the attack was deliberate, sudden and unexpected,
affording the hapless, unarmed and unsuspecting victim no opportunity to resist or to defend himself.
Nimuan was correctly sentenced to suffer the penalty of reclusion perpetua since the mitigating
circumstance of voluntary surrender cannot be appreciated in his favor; the records indicate that
Nimuan did not intend to assume responsibility for the death of the victim when he and his mother
went with the barangay officials to the police station.
PEOPLE OF THE PHILIPPINES v. JAY MANDY MAGLIAN y REYES
G.R. No. 189834, 30 March 2011, FIRST DIVISION (Velasco, Jr., J.)
The essence of voluntary surrender is spontaneity and the intent of the accused to give himself
up and submit himself to the authorities either because he acknowledges his guilt or he wishes to save
the authorities the trouble and expense that may be incurred for his search and capture.
Jay Mandy (Jay) and Mary Jay Maglian (Mary), husband and wife, got into an argument one
night while having dinner. Infuriated, Jay collected all the clothes his wife gave him as a Christmas
gift and poured kerosene over them, threatening to burn them. Mary tried to stop him, but Jay poured
kerosene all over her as well, and set her and the clothes on fire. Mary was then brought to the
hospital. Mary’s aunt later transferred her to the burn unit of East Avenue Medical Center where her
condition improved, but Jay later transferred her to another hospital without a burn unit. Mary’s
condition thereafter deteriorated and eventually was unable to recover, hence, her death. Her last
words were that her husband burned her. Jay Mandy claims that it was pure accident. While he did
pour kerosene over the clothes, Mary Jay snatched from him the kerosene and the match. Jay Mandy
then went upstairs, but was surprised to hear his wife screaming that she is ablaze. They then brought
her to the hospital, and Jay Mandy also sustained minor burns in the process of helping his wife.
While his wife was at the hospital, Jay applied “red medicine” on her wounds as per the advice
of one Judge Tanguanco. Mary was transferred to several hospitals because they would not allow Jay
to apply the red medicine on her, until he finally stopped because the last hospital told Jay that his
wife’s wounds are getting worse. The Regional Trial Court (RTC) convicted Jay Mandy of parricide.
The Court of Appeals (CA) affirmed the decision. Before the Supreme Court (SC), Jay Mandy contends
that (1) he never or did not intend to commit so grave a wrong as that committed or so grave an
offense as the felony charged against him; and (2) that he voluntarily, and of his own free will,
surrendered or yielded to the police or government authorities.
ISSUE:
Whether or not Jay’s argument that the mitigating circumstance of voluntary surrender will
prosper.
RULING:
YES. An accused may enjoy the mitigating circumstance of voluntary surrender if the
following requisites are present: 1) the offender has not been actually arrested; 2) the offender
surrendered himself to a person in authority or the latters agent; and 3) the surrender was voluntary.
We explained, the essence of voluntary surrender is spontaneity and the intent of the accused to give
himself up and submit himself to the authorities either because he acknowledges his guilt or he
wishes to save the authorities the trouble and expense that may be incurred for his search and
capture.
We find that in the case of Jay Mandy, all the elements for a valid voluntary surrender were
present. Jay Mandy at the time of his surrender had not actually been arrested. He surrendered to the
police authorities. His surrender was voluntary, as borne by the certification issued by the police.
There is, thus, merit to the claim of Jay Mandy that he is entitled to the mitigating circumstance of
voluntary surrender.
It bears noting that parricide, however, according to Art. 246 of the Revised Penal Code, is
punishable by two indivisible penalties, reclusion perpetua to death. The Code provides under Art.
63(3) that when a law prescribes a penalty with two indivisible penalties and the commission of the
act is attended by some mitigating circumstance and there is no aggravating circumstance, the lesser
penalty shall be applied. But Section 3 of Republic Act No. (RA) 9346 (An Act Prohibiting the
Imposition of Death Penalty in the Philippines) provides that persons convicted of offenses punished
with reclusion perpetua, or whose sentences will be reduced to reclusion perpetua, by reason of this
Act, shall not be eligible for parole under Act No. 4103, otherwise known as the Indeterminate
Sentence Law, as amended. The proper sentence in the instant case would, thus, be reclusion
perpetua which is still the lesser penalty.
AGGRAVATING CIRCUMSTANCES
Dwelling and Illegal Possession of Firearm
PEOPLE OF THE PHILIPPINES v. ARNOLD T. AGCANAS

G.R. No. 174476, 11 October 2011, EN BANC (Sereno, J.)
Dwelling is aggravating because of the sanctity of privacy which the law accords to human
abode. The actual firearm itself need not be presented if its existence can be proved by the testimonies
of witnesses or by other evidence presented.
Warlito and Beatriz Raguirag was having dinner at home when Arnold Agcanas suddenly
entered through their kitchen door and shot Warlito at the back of his left ear. Beatriz immediately
recognized Agcanas who was her nephew. Beatriz reported the incident to the police and after a
search was done, the police found Agcanas in the house of his brother.
Agcanas was charged for the crime of murder. The Regional Trial Court found Agcanas guilty
of murder, qualified by treachery and attended by the aggravating circumstances of dwelling and use
of an illegally possessed firearm. The Court of Appeals affirmed the conviction.
ISSUES:
Whether or not the qualifying circumstance of treachery, the aggravating circumstances of

dwelling and illegal possession of firearm were sufficiently proved to convict Agcanas.
RULING:
YES. Warlito was then eating his dinner, seated with his back to the kitchen door. Suddenly,
without provocation or reason, the Agcanas entered through that door and shot the Warlito in the
head, causing the latter's instantaneous death. With the suddenness of the attack, the Warlito could
not do anything, except turn his head towards the accused.
The trial court was also correct in ruling that dwelling was an aggravating circumstance. It
has been held in a long line of cases that dwelling is aggravating because of the sanctity of privacy
which the law accords to human abode. He who goes to another's house to hurt him or do him wrong
is more guilty than he who offends him elsewhere.
The aggravating circumstance of illegal possession of firearm was likewise properly

appreciated, even though the firearm used was not recovered. The actual firearm itself need not be
presented if its existence can be proved by the testimonies of witnesses or by other evidence
presented. In the case at bar, Beatriz Raguirag testified that she saw the accused holding a gun and
then heard a gunshot. The post-mortem examination also showed that the accused died of a gunshot
wound. Thus, the presentation of the actual firearm was not indispensible to prove its existence and
use. Second, during pre-trial the accused admitted that he was not a licensed firearm holder.
Taking Advantage of Superior Strength
PEOPLE OF THE PHILIPPINES v. ALEX PALING, ERNIE VILBAR, and ROY VILBAR
G.R. No. 185390, 16 March 2011, FIRST DIVISION (Velasco, J.)
The aggravating circumstance of taking advantage of superior strength is taken into account
whenever the aggressor purposely used excessive force that is out of proportion to the means of defense
available to the person attacked. The victim need not be completely defenseless in order for the said
aggravating circumstance to be appreciated.
On the night of July 1, 1996, while Richard Nolasco (Richard) and two others were going
home, they were invited to a drinking spree at kagawad Rene Mondejar’s house by Alex Paling
(Paling), Ernie Vilbar (Vilbar), and the said kagawad. They were with the victim Walter Nolasco at
that time. They went ahead to the drinking spree while Richard just waited outside. Later on, Richard
reminded them to go home to Paling’s farmhouse where they slept, because they had to go to school
the following day. Walter was left behind.
Later that night, Walter’s uncle Francisco awoke to the sound of his dogs barking. When he
checked, he saw Walter, Ernie, and Roy Vilbar walking towards Brgy. Greenhills where Paling’s
farmhouse was located. Meanwhile, Richard, already sleeping at the farmhouse, awoke because he
heard Jeniline–Paling’s daughter–shout: “Kill him.” When Richard went to find out what was
happening, he saw Roy holding Walter while Paling and Ernie were stabbing him. When Walter was
killed, the three threatened to kill Richard too if he said anything. After that, Francisco woke up again
when he heard his dogs barking, and this time he saw Roy and Ernie running without Walter.
The next day, Walter’s body was found in a certain Jonathan Policarpio’s farmhouse. Paling
and Roy alleged they were working at different farms during that day. Ernie is at large. The Regional
Trial Court (RTC) convicted Paling and Roy of murder. The Court of Appeals (CA) affirmed the
decision. Paling contends that the CA erred in its decision because it merely relied on the testimony
of Richard, the lone eyewitness, and that the case was merely “inherited” from a presiding judge who
initially tried and heard the case.
ISSUE:
Whether or not Paling, Ernie, and Roy are guilty of murder as qualified by the aggravating
circumstance of taking advantage of superior strength.
RULING:
YES. The killing of Walter was neither attended by treachery nor evident premeditation. In
this regard, it is worth noting that qualifying circumstances cannot be presumed, but must be
established by clear and convincing evidence as conclusively as the killing itself. Similarly, the
qualifying circumstance of evident premeditation cannot also be considered since there was neither
proof that Paling and the other accused indeed planned or determined to kill Walter nor was there
any proof that the perpetrators had sufficient lapse of time between the determination and the
execution to allow them to reflect.
Despite the foregoing disquisition, the crime committed by Paling is still murder and not
homicide, since the killing of Walter is qualified by taking advantage of superior strength. The
aggravating circumstance of taking advantage of superior strength is considered whenever there is
notorious inequality of forces between the victim and the aggressors that is plainly and obviously
advantageous to the aggressors and purposely selected or taken advantage of to facilitate the
commission of the crime. It is taken into account whenever the aggressor purposely used excessive
force that is out of proportion to the means of defense available to the person attacked. The victim
need not be completely defenseless in order for the said aggravating circumstance to be appreciated.
In the present case, the victim, Walter, while being restrained by Roy, was simultaneously
stabbed by Paling and Ernie. Plainly, not only did the perpetrators outnumber their victim, more
importantly, they secured advantage of their combined strength to perpetrate the crime with
impunity. Under these circumstances, it is undeniable that there was gross inequality of forces
between the victim and the three accused.
Treachery
PEOPLE OF THE PHILIPPINES v. MARIANITO TERIAPIL Y QUINAWAYAN

G.R. No. 191361, 2 March 2011, SECOND DIVISION, (Abad, J.)
An assailant uses treachery when he suddenly and unexpectedly attacks his unsuspecting victim
and denies him any real chance to defend himself. By this, the assailant ensures the success of his attack
with no risk to his person.
Around 11:00 a.m. of November 29, 2003, two groups of men engaged in a pigeon race. One
group consisted of the victim Joel Montero (Montero), Ramil Rama (Rama), Randy Conje, and
Eduardo Arevalo (Arevalo) collectively referred to as the Montero Group. The other group consisted
of the accused Teriapil and Balonga. The latter approached the Montero group and challenged them
to a race. When the Montero group lost, they thought the accused had cheated them. Hence, they went
to look for the two to get their money back. But pillboxes met them. Nonoy, a brother of the accused
Balonga, threw the pillboxes and Teriapil shot Montero with a pen gun. Montero died on the hospital.
Teriapil denied killing Montero saying that he was at home at the time of the shooting. The defense,
however, failed to prove this.
The Regional Trial Court (RTC) found Teriapil guilty of murder and sentenced him to suffer
the penalty of reclusion perpetua. The RTC further held that accused Teriapil was also guilty of
treachery, a qualifying circumstance in the case even though the prosecution failed to prove evidence
of evident premeditation. The Court of Appeals (CA) affirmed the RTC’s decision saying that treachery
was present because during the time of his attack, Teriapil was inside his house and then shot
Montero rendering him incapable of defending himself.
ISSUE:
Whether or not treachery was present in the case
RULING:
NO. An assailant uses treachery when he suddenly and unexpectedly attacks his unsuspecting
victim and denies hi any real chance to defend himself. By this, the assailant ensures the success of
his attack with no risk to his person.
Here, the clash between the Montero group and the accused happened spontaneously. When
the Montero group got to where the accused were, they were met with pillboxes. From the order of
events it can be gleaned that the Montero group was fully alerted when the pillboxes were thrown,
and they knew that they had to defend themselves. Moreover, based on the records, the march of
events did not afford accused Teriapil and Balonga the time to plan how they would resist the
Montero group. The fact that the Montero group was met with pillboxes should have been their cue
to be in a defensive mode. Anent the second issue, Teriapil assails the inconsistencies of the
testimonies of the witnesses but the Court did not give them merit for what matters most is that the
core theory of the prosecution is solid. Therefore, the Court modified the decision of the CA finding
Teriapil guilty of homicide without the qualifying circumstance of treachery.
Conspiracy
PEOPLE OF THE PHILIPPINES v. JANJALANI, et al.

G.R. No. 188314, 10 January 2011 THIRD DIVISION (Sereno, J.)
Where acts of the accused collectively and individually demonstrate the existence of a common
design towards the accomplishment of the same unlawful purpose, conspiracy is evident and all the
perpetrators will be held liable as principals.
An RCGG bus is plying the Navotas – Makati route through the Epifanio Delos Santos Avenue
(EDSA). The conductor reluctantly agreed to allow two (2) passengers namely, Gamal Baharan
(Baharan) and Angelo Trinidad (Trinidad) to ride the said bus. His doubts continued to suspect that
the two who boarded the bus were up to no good when they each paid for both of their tickets and
were apparently fidgeting with something when he was traversing the aisle from time to time and
was eyeing him apprehensively. After some time, the two alighted at Ayala Avenue, and the conductor
felt an explosion and saw the bus apparently on fire. He sought shelter from a nearby mall and got
back to the bus and saw some passengers lying, some dead, some traumatized.
The prosecution presented evidence that shortly before the explosion, the Department of
Justice (DOJ) received a video from the terrorist Abu Sayyaf Group that they had prepared a
Valentine’s Day surprise for President Gloria Macapagal-Arroyo that included various bombing
attacks around the metro. Baharan confessed his wrongdoing at a radio station where he was
subsequently arrested along with his cohorts. His boss however, Khaddafy Janjalani, remains at-
large.
It was proven in the trial courts that Asali was trained by the terrorist group to formulate and
make bombs wherein Trinidad and Baharan in turn would execute the bombings. They were found
guilty by the Regional Trial Court.
ISSUE:
Whether or not all of the accused should be found guilty based on conspiracy.
RULING:
YES. The Court affirms the finding of the existence of conspiracy involving accused Baharan,
Trinidad, and Rohmat. Conspiracy was clearly established from the collective acts of the accused-
appellants before, during and after the commission of the crime. As correctly declared by the trial
court in its Omnibus Decision: Asalis clear and categorical testimony, which remains unrebutted on
its major points, coupled with the judicial admissions freely and voluntarily given by the two other
accused, are sufficient to prove the existence of a conspiracy hatched between and among the four
accused, all members of the terrorist group Abu Sayyaf, to wreak chaos and mayhem in the
metropolis by indiscriminately killing and injuring civilian victims by utilizing bombs and other
similar destructive explosive devices.
While said conspiracy involving the four malefactors has not been expressly admitted by
accused Baharan, Angelo Trinidad, and Rohmat, more specifically with respect to the latters
participation in the commission of the crimes, nonetheless it has been established by virtue of the
aforementioned evidence, which established the existence of the conspiracy itself and the
indispensable participation of accused Rohmat in seeing to it that the conspirators criminal design
would be realized.
In People v. Geronimo, the Court pronounced that it would be justified in concluding that the
defendants therein were engaged in a conspiracy when the defendants by their acts aimed at the
same object, one performing one part and the other performing another part so as to complete it,
with a view to the attainment of the same object; and their acts, though apparently independent, were
in fact concerted and cooperative, indicating closeness of personal association, concerted action and
concurrence of sentiments.
PEOPLE OF THE PHILIPPINES v. BARANGAY CAPTAIN TONY TOMAS, SR., BENEDICTO

DOCTOR, and NESTOR GATCHALIAN
G.R. No. 192251, 16 February 2011, FIRST DIVISION (Velasco, J.)
Conspiracy: Mere presence at the scene of the crime at the time of its commission without proof
of cooperation or agreement to cooperate is not enough to constitute one a party to a conspiracy.
At around 9:45 in the evening on July 19, 2006, the victim (Estrella), with her mother
Damiana Doctor (Damiana) and caretakers Liezl Toledo (Liezl) and Angelita Duque (Angelita), were
traversing the road towards her house in Barangay Baybayaos, Mayantoc, Tarlac after she had parked
her rented car at the house of Liezl’s mother-in-law, Erlinda Toledo. They had just come from the
clinic of Dr. Salvador for a medical check-up of Damiana.
Estrella was walking slightly ahead of her mother and Angelita when Tomas, Sr., Doctor and
Gatchalian suddenly came out from the side of the road. Tomas, Sr. and Doctor are cousins of Estrella.
Thereupon, without saying anything, Tomas, Sr. drew a gun and shot Estrella twice at a distance of
about 1.5 meters away. Gatchalian, without a gun, allegedly supported Tomas, Sr. by standing in a
blocking position along the road, while Doctor positioned himself at the back of Damiana and Angelita
and poked a handgun at them, telling them to lie face down on the ground, though they did not totally
drop on the road but were in a kneeling position.
When Tomas, Sr. fired the first two shots at Estrella, the latter fell down but the former still
followed it with three more shots when she was already prone on the ground. After the five shots,
Tomas, Sr., Doctor and Gatchalian fled towards the house of Tomas, Sr. Liezl, who was standing about
four meters away from Estrella, shouted, “Saklulu, tulungan ninyo kami (Help, help us)”, then ran to
her house. Meanwhile, Angelita came to the aid of 80-year-old Damiana, who suffered a hypertensive
attack after seeing what happened to her daughter. Angelita waved her hand to seek assistance from
Barangay Kagawad Yolanda Pablo (KagawadPablo) who came out on the road.
ISSUE:
Whether or not there was conspiracy
RULING:
YES, conspiracy duly proven. Conspiracy exists when two or more persons come to an
agreement concerning the commission of a crime and decide to commit it. It may be proved by direct
or circumstantial evidence consisting of acts, words or conduct of the alleged conspirators before,
during and after the commission of the felony to achieve a common design or purpose. Conspiracy
requires the same degree of proof required to establish the crime proof beyond reasonable doubt; as
mere presence at the scene of the crime at the time of its commission without proof of cooperation
or agreement to cooperate is not enough to constitute one a party to a conspiracy.
In the instant case, the ascertained facts of the shooting to death of Estrella with treachery
established beyond reasonable doubt the commission of the crime of murder. Tomas, Sr.s guilt has
been proved beyond reasonable doubt. To be equally guilty for murder, it must be shown that Doctor
and Gatchalian conspired with Tomas, Sr., for in a conspiracy, every act of one of the conspirators in
furtherance of a common design or purpose of such a conspiracy is the act of all. From the clear
testimony of Angelita and Liezl, it has been duly established that Doctors contemporaneous act was
made in furtherance of the common purpose of killing Estrella and ensuring impunity from the act.
Indeed, Doctors cooperation in the shooting of Estrella ensured its accomplishment and their
successful escape from the crime scene. Doctor is, thus, equally guilty and liable for the murder of
Estrella on account of conspiracy.
ANTONIO Y. DE JESUS, SR., et. al. v. SANDIGANBAYAN-FOURTH DIVISION AND PEOPLE OF THE
PHILIPPINES
G.R. Nos. 182539-40, 21 February 2011, SECOND DIVISION (Abad, J.)
The prosecution is not required to prove conspiracy by evidence that the three local officials sat
down and came to an agreement to commit the crimes of which they were charged. Such conspiracy
may be proved by a number of circumstances from which one may infer that the accused were animated
by a common criminal purpose.
The Office of the Ombudsman charged the accused public officers Antonio Y. de Jesus, Sr. (De
Jesus, Sr.), Mayor of Anahawan, Southern Leyte, Anatolio A. Ang (Ang), his Vice-Mayor, and Martina
S. Apigo (Apigo), the Treasurer, of falsification of public document before the Sandiganbayan and all
three, along with Antonio de Jesus, Jr. (De Jesus, Jr.), the mayor’s son, of violation of Republic Act
(R.A.) 3019.
The first information alleged that De Jesus, Sr., Ang, and Apigo (accused local officials)
falsified the Requests for Quotation and Abstract of Proposal of Canvass on by making it appear that
Cuad Lumber and Hinundayan Lumber submitted quotations for the supply of coco lumber, when
they did not in fact do so, in violation of Article 171 of the Revised Penal Code. The second information
alleges that, taking advantage of their positions, the three municipal officers gave unwarranted
advantage to De Jesus, Jr., who operated under the name Anahawan Coco Lumber Supply, by
awarding to him the supply of coco lumber. After the prosecution rested its case, all three-accused
filed a motion for leave to file demurrer to evidence, which motion the Sandiganbayan denied. Rather
than present evidence, however, they proceeded to file their demurrer, in effect waiving their right
to present evidence. The prosecution opposed the demurrer.
The Sandiganbayan rendered judgment, convicting the accused local officials of the crimes
charged. It, however, acquitted accused De Jesus, Jr. Upon denial of their motion for Reconsideration
they came to the Supreme Court on petition for review.
ISSUE:
Whether or not the Sandiganbayan erred in finding that there is conspiracy among the
accused local officials, hence, charging them of the two crimes.
RULING:
NO. The prosecution is not required to prove conspiracy by evidence that the three local
officials sat down and came to an agreement to commit the crimes of which they were charged. Such
conspiracy may be proved by a number of circumstances from which one may infer that the accused
were animated by a common criminal purpose.
Here, the accused municipal treasurer certified by her signature that a canvass of suppliers
was undertaken and that their quotations on the Requests for Quotations were correct. This
obviously did not take place since the document lacked the required signatures of two supposed
bidders. Besides, the Cuad Lumber’s owner testified that he took no part in the canvass and that his
business name was Cuad General Merchandise and not Cuad Lumber as stated in the Requests.
During pre-trial the defense admitted that the accused local officials signed the Requests for
Quotation and the Abstract of Proposal of Canvass despite the absence of bidders’ signatures. The
accused local officials acted in concert.
The Court also found their signing in two capacities unusual or irregular. Normally, the roles
of witnesses are performed by subordinates since superior officers assume the job of assessing the
correctness of the transaction. This circumstance is suspicious and supports the belief that the
accused local officials conspired to falsify the documents to favor the mayor’s son. Hence, there is
conspiracy on the case at hand.
PEOPLE OF THE PHILIPPINES v. EFREN PATELAN LAMBERTE @ KALBO and MARCELINO RUIZ
NIMUAN @ CELINE, MARCELINO RUIZ NIMUAN
G.R. No. 182918, 6 June 2011, THIRD DIVISION, (Brion, J.)
In conspiracy, the act of one is the act of all; each of the accused is equally guilty of the crime
committed.
Eulalia Garcia was tending her sari-sari store when Marcelino Nimuan (Nimuan) and Efren
Lamberte (Lamberte) came to borrow her gas lamp. She noticed that both were drunk and armed.
They said they were looking for a bullet that fell on the ground. After finding the bullet, she asked
them where they were going and they answered, “We are going to kill the doctor.” Shortly thereafter,
the victim (Dr. Jose Villanueva), on board a truck, passed by Garcia’s store on the way to his poultry
farm. Nimuan and Lamberte followed on foot. Ten (10) minutes later, Garcia heard two (2) gunshots
coming from the direction of the poultry farm.
It appears that the victim arrived at his poultry farm to deliver medicines and bread to his
workers. Subsequently, the workers heard gunfire coming from the victim’s direction. Manolong
went down to investigate. On hearing a second shot, Manolong ran towards the parked truck and saw
the victim lying on the ground with a gunshot wound in his stomach. Manolong called his
companions, yelling that the victim had been shot. On hearing Manolong’s cries for help, Yaranon and
Anasario ran toward Building 5. On the way, they met Nimuan and Lamberte. Nimuan kicked Yaranon
three times and hit him on the stomach with the butt of the carbine he was holding, while Lamberte
poked a shotgun at Anasario.
Nimuan and Lamberte threatened Yaranon and Anasario with harm should they tell anyone
that they were responsible for the killing of the victim. The prosecution filed case before the Regional
Trial Court (RTC). RTC found Nimuan guilty of murder. Upon appeal, the Court of Appeals (CA),
affirmed RTC Decision.
ISSUE:
Whether or not Nimuan and Lamberte were in conspiracy
RULING:
YES. The testimonies of the prosecution witnesses clearly prove that a conspiracy existed in
the commission of the crime. Garcia testified that Nimuan and Lamberte had the common design of
killing the victim. The fact that each one was armed with a firearm shows that they acted with the
singular purpose of killing the victim. Both accused threatened workers Manolong, Yaranon and
Anasario with harm should they tell anyone that they (accused) killed the victim. Under these facts,
it does not matter who actually shot the victim because of the conspiracy that existed. In conspiracy,
the act of one is the act of all; each of the accused is equally guilty of the crime committed. Further,
the CA correctly appreciated the qualifying circumstance of treachery as the victim was shot at the
back. The attack was deliberate, sudden and unexpected; it afforded the unsuspecting victim no
opportunity to resist or defend himself.
PEOPLE OF THE PHILIPPINES v. RESTITUTO CARANDANG, HENRY MILAN AND JACKMAN
CHUA
G.R. No. 175926, 6 July 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Evidence need not establish the actual agreement among the conspirators showing a
preconceived plan or motive for the commission of the crime. Proof of concerted action before, during
and after the crime, which demonstrates their unity of design and objective, is sufficient. When
conspiracy is established, the act of one is the act of all regardless of the degree of participation of each.
The sister of Henry Milan (Milan) went to the La Loma Police Station 1 to inform the police
that a drug deal would take place in her house. SPO2 Wilfredo Pilar Red, Police Officer (PO2) Dionisio
Alonzo, SPO1 Estores and SPO1 Montecalvo then proceeded to the house of Milan. When the group
of police officers reached the house, they saw Milan, Restituto Carandang (Carandang) and Jackman
Chua (Chua) inside. When the police introduced themselves Milan suddenly shut the door of the
house. PO2 Alonzo and SPO2 Red forcibly opened the door and when it opened, gunshots rang out
and PO2 Alonzo and SPO2 Red were hit and instantly killed. SPO1 Montecalvo, who was behind the
two fallen policemen, was also hit. SPO1 Estores then went inside the house and pulled SPO1
Montecalvo out.
Milan was brought to the hospital while Carandang and Chua locked themselves in the house.
It was around 11 pm to 12 a.m. when they finally surrendered. Milan, Carandang, and Chua were then
charged with Murder and Frustrated Murder. After the trial, the Regional Trial Court (RTC) rendered
judgment finding Milan, Carandang and Chua guilty of the offenses charged. This was affirmed by the
Court of Appeals. Milan and Chua were the only ones who brought the appeal to the Supreme Court,
alleging that they did not conspire with Carandang for the commission of the offenses; and that it was
only Carandang who shot the victims.
ISSUE:
Whether or not Milan and Chua conspired with Carandang to commit the offense of murder
and frustrated murder.
RULING:
YES. Conspiracy exists when two or more persons come to an agreement concerning the
commission of a felony and decide to commit it. Evidence need not establish the actual agreement
among the conspirators showing a preconceived plan or motive for the commission of the crime.
Proof of concerted action before, during and after the crime, which demonstrates their unity of design
and objective, is sufficient. When conspiracy is established, the act of one is the act of all regardless
of the degree of participation of each.
The conclusion that Milan and Chua conspired with Carandang was established by their acts
(1) before Carandang shot the victims (Milans closing the door when the police officers introduced
themselves, allowing Carandang to wait in ambush), and (2) after the shooting (Chua’s directive to
Milan to attack SPO1 Montecalvo and Milan’s following such instruction). Contrary to the
suppositions of the Milan and Chua, these facts are not meant to prove that Chua is a principal by
inducement, or that Milan’s act of attacking SPO1 Montecalvo was what made him a principal by
direct participation. Instead, these facts are convincing circumstantial evidence of the unity of
purpose in the minds of the three. As co-conspirators, all three are considered principals by direct
participation.
Neither can the rapid turn of events be considered to negate a finding of conspiracy. Unlike
evident premeditation, there is no requirement for conspiracy to exist that there be a sufficient
period of time to elapse to afford full opportunity for meditation and reflection. Instead, conspiracy
arises on the very moment the plotters agree, expressly or impliedly, to commit the subject felony.
PEOPLE OF THE PHILIPPINES v. FLORENCIO AGACER, et al.

G.R. No. 177751, 14 December 2011, FIRST DIVISION (Del Castillo, J.)
Conspiracy exists when two or more persons come to an agreement concerning the commission
of a felony and decide to commit it.
Florencio, Franklin, Elynor, Eric and Eddie, all surnamed Agacer, were charged with murder
for the killing of Cesario Agacer (Cesario). According to the prosecution witnesses, Cesario was
clearing a section of his farm and preparing the beddings for the rice seedlings intended for the
coming planting season when the Florencio, et al. suddenly emerged from a nearby banana plantation
and surrounded Cesario. Visibly intimidated, Cesario moved backwards and retreated to where the
other farm laborers were working. However, Franklin set afire the rice straws that covered Cesario’s
rice seedlings. This prompted Cesario to return to put out the fire and save his rice seedlings. At this
point, Franklin and Eric started throwing stones at Cesario which forced the latter to retreat again.
Thereafter, Florencio, while standing side by side with Eric, signaled Cesario to come closer.
Cesario obliged but when he was just around five meters away from the group, Eddie suddenly pulled
out a gun concealed inside a sack and shot Cesario hitting him in the left portion of his chest. Almost
simultaneously, Elynor took aim at Cesario with his bow and arrow but missed his mark. Florencio,
et al. then immediately left the scene of the crime. The Regional Trial Court (RTC) convicted Florencio,
et al. as charged. The Court of Appeals (CA) affirmed.
ISSUES:
Whether or not conspiracy was sufficiently established.
RULING:
YES. Conspiracy exists when two or more persons come to an agreement concerning the
commission of a felony and decide to commit it. In conspiracy, it is not necessary to adduce direct
evidence of a previous agreement to commit a crime. It may be shown through circumstantial
evidence, deduced from the mode and manner in which the offense was perpetrated, or inferred from
the acts of the accused themselves when such lead to a joint purpose and design, concerted action,
and community of interest. Proof of a previous agreement and decision to commit the crime is not
essential but the fact that the malefactors acted in unison pursuant to the same objective suffices.
Here, while there is no proof of any previous agreement among appellants to commit the
crime and while it was established during trial that Eddie alone shot Cesario, the acts of all appellants
before, during and after the incident establish the existence of conspiracy to kill Cesario beyond
reasonable doubt. First, all of them emerged at the same time from a banana plantation beside the
ricefield. Second, they surprised Cesario by immediately surrounding him. Third, all of them were
armed at the time of the incident. Eddie had a shotgun concealed in a sack, Florencio was armed with
a bolo, Elynor had a bow and arrow, while Eric and Franklin had stones in their hands. Fourth, Eric
and Franklin struck Cesario with stones moments before the shooting. Fifth, Eddie immediately shot
Cesario at close range while the latter was approaching the group of appellants upon being
summoned by Florencio. Sixth, Florencio, Franklin, Eric and Elynor stood just a meter away from
Eddie when he shot Cesario, but did not do anything to stop or dissuade Eddie from the assault.
Seventh, after Cesario was shot, all appellants departed from the scene of the crime together.
Undoubtedly, the acts of the assailants constitute proof of their unanimity in design, intent
and execution. They performed specific acts with closeness and coordination as to unmistakably
indicate a common purpose and design to ensure the death of Cesario. The Court thus upholds the
lower court’s finding that appellants conspired to commit the crime of murder against Cesario.
PEOPLE OF THE PHILIPPINES v. NELIDA DEQUINA Y DIMAPANAN, JOSELITO JUNDOC Y

JAPITANA & NORA JINGABO Y CRUZ
G.R. No. 177570, 19 January 2011, FIRST DIVISION, (Leonardo-Castro, J.)
Conspiracy may be deduced from the mode and manner in which the offense was perpetrated.
Based on a report given by the informant, Police Officer III Wilfredo Masanggue and SPO1
Anthony Blanco parked their mobile patrol car along Juan Luna Street while waiting for a male and
two females who would be coming from Baguio City to deliver unknown quantity of marijuana. A taxi
cab arrived with a man and two women each one of them carrying a black travelling bag. As the trio
fitted the descriptions given to them, they intently watched and monitored their movements. As the
patrol car got closer behind them, Dequina noticed its presence. She started walking in a more
hurried pace which prompted SPO1 Blanco to chase them. While trying to get away, Dequina dropped
her bag and bundles of dried leaves wrapped in transparent plastic bags case into view. Dequina,
Jundoc and Jingabo were arrested and were charged with Violations of Section 4, in relation to Section
21, paragraphs (e-l), (f), (m), and (o) of Republic Act No. 6425, otherwise known as the Dangerous
Drugs Act of 1972, as amended by Republic Act No. 7659. The Regional Trial Court found Dequina,
Jundoc and Jingabo guilty as charged. The Court of Appeals affirmed their conviction.
ISSUES:
Whether or not conspiracy exists
RULING:
YES. Conspiracy can be inferred from and proven by acts of the accused themselves when
said acts point to a joint purpose and design, concerted action, and community of interests. Although
the same degree of proof required for establishing the crime is required to support a finding of the
presence of conspiracy, it need not be proven by direct evidence. Conspiracy may be deduced from
the mode and manner in which the offense was perpetrated. This was shown when by their account,
the three accused left Iloilo together, stayed in Manila for a while, left for Dau, Mabalacat, Pampanga
and returned to Manila thereafter. They were together when the apprehending police officers
pounced on them near the pier premises on their way back to Iloilo, each of them carrying a travelling
bag which contained marijuana.
HOW CRIMINAL LIABILITY IS TOTALLY EXTINGUISHED
PEOPLE OF THE PHILIPPINES v. JULIET OLACO y POLER

G.R. No. 197042, 17 October 2011, FIRST DIVISION (Leonardo- De Castro, J.)
According to Article 89(1) of the Revised Penal Code, criminal liability is totally extinguished by
the death of the convict, as to the personal penalties; and as to pecuniary penalties, liability therefor is
extinguished only when the death of the offender occurs before final judgment.
Juliet Olaco y Poler (Olaco) was charged with Qualified Theft. When arraigned, Olaco pleaded
not guilty. The Regional Trial Court (RTC) rendered a decision finding Olaco guilty. Olaco was
committed to the Correctional Institution for Women. Olaco filed an appeal before Court of Appeals
(CA) which denied the appeal and affirmed with modification RTC judgment.
Subsequently, the Superintendent IV of the Correctional Institution for Women informed CA

that Olaco had died. Olaco’s counsel still filed, on behalf of the deceased, Notice of Appeal which CA
gave due course. Accordingly, CA elevated the records to the Court.
ISSUE:
Whether or not Olaco’s death extinguishes her criminal liability
RULING:
YES. Olaco died during the pendency of her appeal; thus, her criminal liability for qualified
theft as well her civil liability arising from or based on said crime has been extinguished. According
to Article 89(1) of the Revised Penal Code, criminal liability is totally extinguished by the death of the
convict, as to the personal penalties; and as to pecuniary penalties, liability therefor is extinguished
only when the death of the offender occurs before final judgment.
The Court already laid down the guidelines regarding extinguishment of liability due to death
of convict in the case of People v. Bayotas. As held in the case, death of the accused pending appeal of
his conviction extinguished criminal liability as well as civil liability based solely thereon. Claim fir
civil liability survives notwithstanding the death of the accused if the same may also be predicated
on a source of obligation other than delict. Where civil liability survives, action for recovery may be
pursued by filing separate civil action subject to Section 1, Rule 111 of Rules of Court. In the case at
bar, Olasco’s appeal was still pending and no final judgment had been rendered at the time of her
death.
CRIMINAL LAW II
CRIMES AGAINST PUBLIC INTEREST
Illegal Possession and Use of False Treasury or Bank Notes and Other Instruments of Credit
MARK CLEMENTE Y MARTINEZ @ EMANNUEL DINO v. PEOPLE OF THE PHILIPPINES

Possession of false treasury or bank notes alone, without anything more, is not a criminal
offense. For it to constitute an offense under Article 168 of the Revised Penal Code, the possession must
be with intent to use said false treasury or bank notes.
In this case, the Prosecution alleged that Mark Clemente (Clemente) is a detainee at the
Manila City Jail. Francis Dela Cruz (Dela Cruz), an informant and an inmate, approached Jail Officers
Domingo David (David) and Michael Passilan (Passilan), and narrated that he received a counterfeit
P500.00 bill from Clemente with orders to buy a bottle of soft drink from the Jail Bakery. The bakery
employee, however, recognized the bill as a fake and refused to accept the same. David, Passilan, and
Dela Cruz went to Clemente’s cell for a surprise inspection. Dela Cruz returned to Clemente his
P500.00 bill. When Passilan frisked Clemente, he recovered a wallet where 23 pieces of P500.00 were
found, all of which were suspected to be counterfeit. They confiscated the same and marked them.
The 24 bills were turned over to the Bangko Sentral ng Pilipinas (BSP) for analysis. It was found that
all of them are counterfeit.
On the other hand, Clemente simply raised the defense of frame-up. He was inside his room
when Passilan entered his room. Without any warning, Passilan frisked him and confiscated his
wallet containing one (1) P1,000.000 bill. Clemente followed Passilan and David when they left, and
he saw Passilan place P500.00 bills inside his wallet. He was then told that the P500.00 bills were
counterfeit and he was being charged with illegal possession and use thereof. The Regional Trial
Court (RTC) found Clemente guilty of the crime of illegal possession and use of false blank notes
under Article 168 of the Revised Penal Code. The same was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not Clemente is guilty of illegal possession and use of false blank notes.
RULING:
NO. The elements of the crime charged for violation of said law are: (1) that any treasury or
bank note or certificate or other obligation and security payable to bearer, or any instrument payable
to order or other document of credit not payable to bearer is forged or falsified by another person;
(2) that the offender knows that any of the said instruments is forged or falsified; and (3) that he
either used or possessed with intent to use any of such forged or falsified instruments. As held in
People v. Digoro, possession of false treasury or bank notes alone, without anything more, is not a
criminal offense. For it to constitute an offense under Article 168, the possession must be with intent
to use said false treasury or bank notes.
In this case, the prosecution failed to show that Clemente used the counterfeit money or that
he intended to use the counterfeit bills. Dela Cruz, to whom Clemente supposedly gave the fake
P500.00 bill to buy soft drinks, was not presented in court. According to the jail officers, they were
only informed by Dela Cruz that Clemente asked the latter to buy soft drinks at the jail bakery using
a fake P500.00 bill. In short, the jail officers did not have personal knowledge that Clement asked Dela
Cruz to use the P500.00 bill. Their account, however, is hearsay and not based on the personal
knowledge.
Falsification by Public Officer, Employee; or Notary or Ecclesiastical Minister
ROSALIO S. GALEOS v. PEOPLE OF THE PHILIPPINES

G.R. Nos. 174730-37, 09 February 2011, THIRD DIVISION (Villarama, J.)
One is guilty of falsification in the accomplishment of his information and personal data sheet if
he withholds material facts which would have affected the approval of his appointment and/or
promotion to a government position.
Ong was appointed Officer-in-Charge (OIC)-Mayor of the Municipality of Naga, Cebu on April
16, 1986. He was elected Mayor of the same municipality in 1988 and served as such until 1998. Ong
extended permanent appointments to Galeos and Federico T. Rivera (Rivera) for the positions of
Construction and Maintenance Man and Plumber I, respectively, in the Office of the Municipal
Engineer. Prior to their permanent appointment, Galeos and Rivera were casual employees of the
municipal government.
In their individual Statement of Assets, Liabilities and Net Worth (SALN) for the year 1993,
Galeos answered "No" to the question: "To the best of your knowledge, are you related within the
fourth degree of consanguinity or of affinity to anyone working in the government?" while Rivera
indicated "n/a" on the space for the list of the names of relatives referred to in the said query.4 The
boxes for "Yes" and "No" to the said query were left in blank by Galeos in his 1994 and 1995 SALN.5
Rivera in his 1995 SALN answered "No" to the question on relatives in government.6 In their 1996
SALN, both Galeos and Rivera also did not fill up the boxes indicating their answers to the same
query.7Ong’s signature appears in all the foregoing documents as the person who administered the
oath when Galeos and Rivera executed the foregoing documents.
In a letter-certification dated June 1, 1994 addressed to Ms. Benita O. Santos, Regional

Director, Civil Service Commission (CSC), Regional Office 7, Cebu City, it was attested that: This is to
certify that pursuant to the provisions of R.A. 7160, otherwise known as the Local Government Code
of 1991, all restrictions/requirements relative to creation of positions, hiring and issuance of
appointments, Section 325 on the limitations for personal services in the total/supplemental
appropriation of a local government unit; salary rates; abolition and creation of positions, etc.;
Section 76, organizational structure and staffing pattern; Section 79 on nepotism; Section 80, posting
of vacancy and personnel selection board; Section 81 on compensation, etc. have been duly complied
with in the issuance of this appointment.
This is to certify further that the faithful observance of these restrictions/requirements was
made in accordance with the requirements of the Civil Service Commission before the appointment
was submitted for review and action.
ISSUE:
Whether or not falsification of public documents was committed
RULING:
YES. The elements of falsification in the above provision are as follows: (a) the offender
makes in a public document untruthful statements in a narration of facts; (b) he has a legal obligation
to disclose the truth of the facts narrated by him; and (c) the facts narrated by him are absolutely
false.
In addition to the afore-cited elements, it must also be proven that the public officer or
employee had taken advantage of his official position in making the falsification. In falsification of
public document, the offender is considered to have taken advantage of his official position when (1)
he has the duty to make or prepare or otherwise to intervene in the preparation of a document; or
(2) he has the official custody of the document which he falsifies. Likewise, in falsification of public
or official documents, it is not necessary that there be present the idea of gain or the intent to injure
a third person because in the falsification of a public document, what is punished is the violation of
the public faith and the destruction of the truth as therein solemnly proclaimed.
Since petitioner Galeos answered "No" to the question in his 1993 SALN if he has relatives in
the government service within the fourth degree of consanguinity, he made an untruthful statement
therein as in fact he was related to Ong, who was then the municipal mayor, within the fourth degree
of consanguinity, he and Ong being first cousins (their mothers are sisters). As to his 1994, 1995 and
1996 SALN, Galeos left in blank the boxes for the answer to the similar query. In Dela Cruz v. Mudlong,
it was held that one is guilty of falsification in the accomplishment of his information and personal
data sheet if he withholds material facts which would have affected the approval of his appointment
and/or promotion to a government position. By withholding information on his relative/s in the
government service as required in the SALN, Galeos was guilty of falsification considering that the
disclosure of such relationship with then Municipal Mayor Ong would have resulted in the
disapproval of his permanent appointment pursuant to Article 168 (j) (Appointments), Rule XXII of
the Rules and Regulations Implementing the Local Government Code of 1991 (R.A. No. 7160). All the
elements of falsification of public documents by making untruthful statements have been established
by the prosecution.
ZAFIRO L. RESPICIO v. PEOPLE OF THE PHILIPPINES

G.R. Nos. 178701 and 178745, 6 June 2011, THIRD DIVISION (Carpio-Morales, J.)
The untruthful assertion of petitioner not having been made in an affidavit or in a statement
required by law to be sworn in, he is, without any doubt, liable for falsification under paragraph 4 of
Article 171 of the Revised Penal Code.
Zafiro Respiscio (Respicio) was the Commissioner of the Bureau of Immigration and
Deportation (BID), when eleven (11) Indian nationals who were facing criminal charges for drug
trafficking, left the country on the basis of the BID Self-Deportation Order (SDO) stating that the BID
has not received any prior request to hold their departure and that there is no indication that they
are the subject of any written complaints before any government agency nor before any private
person. The SDO was signed by Respicio, then Associate Commissioners Bayani Subido (Subido) and
Manuel Roxas (Roxas). Such issuance resulted in the filing before the Sandiganbayan by the Office of
the Special Prosecutor (OSP) of information charging them of falsification of official document under
Article 171 of the Revised Penal Code and for violation of Section 3(e) of Republic Act (RA) No. 3019.
The Indians were charged for violation of the Dangerous Drugs Acts and were subjected to
preliminary investigation. The NBI Deputy Director then informed Respicio of the matter and
requested for the necessary records. The Indians’ counsel recommended the NBI Director for their
deportation for violating immigration laws. Such was endorsed to Respicio for appropriate action
with the information that the criminal cases are under preliminary investigation. After the
preliminary investigation, State Prosecutor Reynaldo Lugtu (Lugtu) filed an information against the
Indians. Respicio referred the endorsement to Lugtu for appropriate action. Before such
endorsement was received by Lugtu, the Indians already signed their requests for self-deportation,
to which an SDO was issued by Respicio.
Respicio disclaimed knowledge that the Indians were already charged before the trial court,
that Lugtu never communicated to him that he had filed the information, but he admitted being aware
of the preliminary investigation. The Sandiganbayan exonerated Subido and Roxas, but found
Respicio guilty as charged.
ISSUES:
1. Whether or not Respicio is guilty of falsification of official document.

2. Whether or not Respicio is guilty of violation of Section 3(e), RA No. 3019.
RULING:
1. YES. The elements of falsification under Article 171, par. 4 of the Revised Penal Code
charged are: (a) the offender is a public officer; (b) the accused takes advantage of his official position;
(c) accused knows that what he imputes is false; (d) the falsity involves a material fact; (e) there is a
legal obligation for him to narrate the truth; (f) and such untruthful statements are not contained in
an affidavit or a statement required by law to be sworn in. Respicio untruthfully stated that there is
no indication from the records that the Indians are the subject of any written complaints before any
government agency nor before any private person. For that statement is belied by documentary
evidence as per the endorsement letters. What is material in this case is that there was a pending
preliminary investigation against the Indians, contrary to the statement in the SDO that there is no
indication from the records that they are the subject of any written complaint which pending
preliminary investigation called for the provisional dismissal of the deportation case. The untruthful
assertion of Respicio not having been made in an affidavit or in a statement required by law to be
sworn in, he is, without any doubt, liable for falsification.
2. YES. Sec. 3(e), RA No. 3019 provides that one of the corrupt practices of any public officer
which are declared to be unlawful is causing any undue injury to any party, including the
Government, or giving any private party any unwarranted benefits, advantage or preference in the
discharge of his official, administrative or judicial functions through manifest partiality, evident bad
faith or gross inexcusable negligence. This provision shall apply to officers and employees of offices
or government corporations charged with the grant of licenses or permits or other concessions.
The elements of the offense are thus: (a) the accused is a public officer discharging
administrative, judicial or official functions; (b) one must have acted with manifest partiality, evident
bad faith or inexcusable negligence; (c) the action caused undue injury to any party including the
Government, or has given any party unwarranted benefit, advantage or preference in the discharge
of his functions. Such elements which must be indubitably proved are whether Respicio acted with
manifest partiality or evident bad faith, and whether such action caused undue injury to any party
including the Government, or gave any party unwarranted benefit, advantage or preference in the
discharge of his functions. Both elements are present in this case. Partiality is differentiated from bad
faith, as the former is synonymous with "bias" which excites a disposition to see and report matters
as they are wished for rather than as they are, and the latter does not simply connote bad judgment
or negligence; it imputes a dishonest purpose or some moral obliquity and conscious doing of a
wrong; a breach of sworn duty through some motive or intent or ill will; it partakes of the nature of
fraud. There is partiality and evident bad faith on the part of Respicio as he never was aware of a case
filed in court. Even if indeed that were true, he had priorly been informed that the Indians were
undergoing preliminary investigation. He eventually admitted knowledge of the pendency of a
preliminary investigation of the criminal cases against the Indians before he issued the SDO.
Falsification by Private Individuals and Use of Falsified Documents
LTC. ROBERTO K. GUILLERGAN (Ret.) v. PEOPLE OF THE PHILIPPINES

G.R. No. 185493, 02 February 2011, FIRST DIVISION (Abad, J.)
The elements of falsification of documents under paragraph 1, Article 172 are: 1) the offender
is a private individual or a public officer or employee who did not take advantage of his official position;
2) the offender committed any of the acts of falsification enumerated in Article 171; and 3) the
falsification was committed in a public or official or commercial document.
The Office of the Ombudsman indicted Roberto K. Guillergan (Guillergan) for estafa through
falsification of public documents before the Sandiganbayan. Evidence shows that Guillergan directed
Chief Clerk of the Comptrollers Office to cause the preparation of payrolls of the CIAs. The AFP Anti-
Graft Board filed a complaint against Rio, Butcon, Maclang, Jr., Seclon, and Guillergan for violating
Articles of War 94 in relation to Article 217 of the Revised Penal Code (RPC).
After preliminary investigation, the Office of the Ombudsman-Visayas issued a resolution

recommending the dismissal of the case for lack of merit. On April 21, 1992, however, the
ombudsman investigator issued a memorandum, recommending the filing of charges of illegal use of
public funds against Rio and the exoneration of the other respondents. In a memorandum[ dated
February 11, 1993, the review panel in the Office of the Special Prosecutor affirmed the
recommendation. However, the Office of the Special Prosecutor recommended the filing of charges
against all the accused before the Sandiganbayan. Consequently, an Information was filed against
them for estafa under Article 315, par. 2(a), in relation to Article 171 of the RPC. While the case was
pending, Rio died, prompting the Sandiganbayan to dismiss the case against him.
On January 20, 2006, the parties submitted a stipulation of facts with motion for judgment
based on such stipulations. On June 30, 2008, the Sandiganbayan Second Division rendered judgment,
finding Guillergan guilty of falsification penalized under Article 172 of the RPC and sentenced him to
suffer the penalty of imprisonment for 2 years and 4 months as minimum to 4 years, 9 months and
10 days as maximum. The court acquitted the other accused on the ground of lack of proof of their
guilt beyond reasonable doubt.
ISSUES:
Whether or not the Sandiganbayan can convict Guillergan of violation of Article 172 of the
RPC under an Information that charged him with estafa in relation to Article 171 of the code
RULING:
YES. The Information alleged that Guillergan committed falsification by making it appear in
several public documents that P1,519,000.00 in AFP funds intended for the CIAs payroll were paid
for that purpose when in truth these were just given to Rio, resulting in damage and prejudice to the
government. Although the charge was estafa in relation to Article 171 of the RPC, the facts alleged in
the information sufficiently made out a case for violation of Article 172 of which Guillergan was
convicted. What is important is that the Information described the latter offense intelligibly and with
reasonable certainty, enabling Guillergan to understand the charge against him and suitably prepare
his defense.
What is punished in falsification of a public document is the violation of the public faith and
the destruction of the truth as solemnly proclaimed in it. Generally, the elements of Article 171 are:
1) the offender is a public officer, employee, or notary public; 2) he takes advantage of his official
position; and 3) that he falsifies a document by committing any of the ways it is done. On the other
hand, the elements of falsification of documents under paragraph 1, Article 172 are: 1) the offender
is a private individual or a public officer or employee who did not take advantage of his official
position; 2) the offender committed any of the acts of falsification enumerated in Article 171; and 3)
the falsification was committed in a public or official or commercial document. All of the foregoing
elements of Article 172 are present in this case.
First. Guillergan was a public officer when he committed the offense charged. He was the
comptroller to the PC/INP Command in Region 6. His official function was limited to keeping the
records of the resources that the command received from Camp Crame. Still, he took the liberty of
intervening in the preparation of the time record, book, and payrolls in question. Second. The
Information alleged that Guillergan committed the offense charged by causing it to appear that
persons participated in an act or a proceeding when they did not in fact so participate. In this case,
the Sandiganbayan found that Guillergan ordered Butcon to sign the receive portion of the payrolls
as payee to make it appear that persons whose names appeared on the same had signed the
document when they in fact did not. Third. There is no dispute that the falsification was committed
on the time record, book, and payrolls which were public documents.
CRIMES COMMITTED BY PUBLIC OFFICERS
Malversation of Public Funds
JOSE T. TUBOLA, JR. v. SANDIGANBAYAN and PEOPLE

The failure of a public officer to have duly forthcoming any public fund or property with which
he is chargeable, upon demand by any duly authorized officer, shall be prima facie evidence that he
has put such missing funds or property to personal uses.
Jose T. Tubola, Jr. (Tubola, Jr.) was the cashier of the National Irrigation Administration (NIA)-
Aganan, Sta. Barbara River Irrigation System in Iloilo City. The Commission on Audit (COA) State
Auditing Examiners Yvonne Gotera (Gotera) and Theresita Cajita (Cajita) conducted an audit
examination of Tubola, Jr.’s account which indicated a shortage of P93,051.88. Gotera and Cajita thus
sent a letter of demand to Tubola, Jr. directing him to account for the shortage. Tubola, Jr. refused to
receive the letter, hence, Gotera and Cajita sent it by registered mail. Tubola, Jr. was thereupon
charged of committing malversation of public funds before the Sandiganbayan.
By way of defense, Tubola, Jr. claimed that he was assigned as cashier since 1978 and was
also in charge of payment of salaries of more than 2,000 field employees in the NIA Jalaur Project;
declared that his task of keeping the collected irrigation fees was temporarily assigned to Editha
Valeria (Valeria) upon instruction of his superior, Regional Director Manuel Hicao, for Tubola, Jr. was
also handling the payroll of around 2,000 employees. Tubola, Jr. further declared that no accounting
of the collected fees was undertaken since he trusted Valeria, who directly remitted them to the bank,
after he signed the statement of collection without reading the contents thereof. Further, Tubola, Jr.
presented “vales” and “chits” involving the total amount of P115,661.66 representing loans extended
by Valeria to certain NIA employees and even COA auditors. And he identified “chits” and “vales”
dated 1975 to 1981 inclusive representing loans extended prior to the audit period. The
Sandiganbayan found Tubola, Jr. guilty beyond reasonable doubt of the crime of malversation of
public funds. Hence, this appeal.
ISSUE:
Whether or not Tubola, Jr. is guilty of malversation of public funds.
RULING:
YES. All the above-mentioned elements are here present. Tubola, Jr. was a public officer─ he
occupied the position of cashier at the NIA. By reason of his position, he was tasked to regularly
handle irrigation fees, which are indubitably public funds pertaining to the NIA, and to remit them
to the depositary bank.
As established by the prosecution, Tubola, Jr. was the one who remitted irrigation fees
collected from June 25, 1982 to October 31, 198327 inclusive, so that even if the Court were to credit
petitioner’s allegation that Valeria had actually taken over his function of collecting the irrigation fees,
the collections were still, in fact by his admission, turned over to him. In fact, Tubola, Jr.’s admission
that his signature was required before remitting the irrigation fees to the depositary bank reinforces
the fact that he had complete control and custody thereof. As to the element of misappropriation,
indeed Tubola, Jr. failed to rebut the legal presumption that he had misappropriated the fees to his
personal use, his disclaimer being self-serving.
As for Tubola, Jr.’s explanation that the unaccounted fees were extended as loans to
employees as evidenced by “vales” and “chits” found in his drawer which involved a total of
P79,044.51, it fails. If this claim were true, Tubola, Jr. could have at least promptly collected them,
and/or offered the testimonies of the employees-obligors to prove good faith on his part. As for the
“vales” and “chits” that he offered in evidence, as the same were admittedly incurred before the period
of audit, they are immaterial.
ZACARIA A. CANDAO, ABAS A. CANDAO, AND ISRAEL B. HARON v. PEOPLE OF THE

PHILIPPINES AND SANDIGANBAYAN
G.R. No. 186659-710, October 19, 2011, FIRST DIVISION (Villarama,Jr., J.)
The following elements are essential for conviction in malversation cases: (1) that the
offender is a public officer; (2) that he had custody or control of funds or property by reason of the
duties of his office; (3) that those funds or property were public funds or property for which he was
accountable; and (4) that he appropriated, took, misappropriated or consented or, through
abandonment or negligence, permitted another person to take them.
The Commission on Audit (COA) constituted a team of auditors from the central office to
conduct an Expanded Special Audit of the Office of the Regional Governor, Autonomous Region for
Muslim Mindanao (ORG-ARMM). As stated in Special Audit Office (SAO) Report submitted by the
audit team, it was found that illegal withdrawals were made from the depository accounts of the
agency through the issuance of checks payable to the order of Israel B. Haron (Haron) without the
required disbursement vouchers. COA demanded from Haron to produce and restitute to the ARMM-
Regional Treasurer immediately the full amount and submit his explanation together with the official
receipt issued by the ARMM Regional Treasurer in acknowledgment of such restitution. The Office of
the Special Prosecutor, Office of the Ombudsman-Mindanao, filed in the Sandiganbayan criminal
cases for malversation of public funds against the following ORG-ARMM officials/employees: Zacaria
A. Candao (Regional Governor), Israel B. Haron (Disbursing Officer II), Abas A. Candao (Executive
Secretary) and Pandical M. Santiago (Cashier). They were charged with violation of Article 217 of the
Revised Penal Code, as amended. The Sandiganbayan found Haron guilty as charged and committed
conspiracy with Zacaria Candao and Abas Candao.
ISSUE:
Whether or not Zacaria, Abas, and Haron are guilty of malversation of public funds.
RULING:
YES. The following elements are essential for conviction in malversation cases: (1) that the
offender is a public officer; (2) that he had custody or control of funds or property by reason of the
duties of his office; (3) that those funds or property were public funds or property for which he was
abandonment or negligence, permitted another person to take them.
All the foregoing elements were satisfactorily established by the prosecution in this case.
Zacaria, Abas and Haron have not rebutted the legal presumption that with the Haron’s failure to
account for the illegally withdrawn amounts covered by the subject checks when demanded by the
COA, they misappropriated and used the said funds for their personal benefit. The Sandiganbayan
categorically ruled that the disbursement vouchers were inexistent at the time of the issuance of the
subject checks and expanded special audit.
GUILLERMO E. CUA v. PEOPLE OF THE PHILIPPINES

To justify conviction for malversation of public funds or property, the prosecution has only to
prove that the accused received public funds or property and that he could not account for them, or did
not have them in his possession and could not give a reasonable excuse for their disappearance.
On June 29, 1994, a regular audit was conducted on the cash account and accountable forms
of Guillermo Cua (Cua), then a Revenue Collection Agent of the Bureau of Internal Revenue (BIR) in
Olongapo City. The initial findings of said audit, based on the documents and cash produced by Cua,
revealed no cash shortage on his account. The accountable forms consisting of Revenue Official
Receipts and the documentary stamps were complete and intact. Based on Cua’s cash book, all his
collections were remitted to the Philippine National Bank (PNB). The total amount of ₱340,950.37,
for which Cua was accountable, appeared to have been deposited at the PNB, Olongapo City Branch.
As part of the examination process, however, a confirmation from the government depository bank
is required to verify the initial audit. Thus, on July 14, 1994, Soto sent a letter to the depository bank,
PNB, requesting confirmation or verification of the authenticity of the official receipts and deposit
slips attached to the collection reports of petitioner.
In a reply dated August 24, 1994, PNB returned the letter-request with a notation that the
amounts stated in three of the official receipts did not tally with their records, that the official receipt
numbers should be specified to facilitate verification of the other deposit slips, and that petitioner
had not made any deposit from June 8 to 27, 1994. Soto proceeded to the PNB to discuss the matter
with Florida Francisco (Francisco), the State Auditor assigned at the Olongapo City Branch, who
checked and verified the official receipts and deposit slips presented by petitioner. In his Letter-reply
dated February 17, 1994, addressed to Soto, Felixberto De Guzman (De Guzman), Department
Manager of the PNB Olongapo City Branch, detailed the discrepancies in the amounts stated in the
actual receipts in the possession of the PNB and the amounts stated in the receipts.
Soto prepared a letter of demand dated August 23, 1994, which contained a summary of the
discrepancies as noted by the PNB, and disclosed that Cua had incurred a cash shortage amounting
to ₱291,783.00. Soto then requested Cua to come to her office to personally receive the demand
letter. Cua then wrote a reply letter dated August 23, 1994, addressed to the resident auditor,
admitting his cash shortage purportedly to get even with the BIR which failed to promote him but
promised to pay the amount as soon as possible. Thereafter, a special arrangement was made
between the BIR and Cua, wherein the former would withhold the salary of the latter and apply the
same to the shortage incurred until full payment of the accountability was made.
ISSUE:
Whether or not the prosecution proved the guilt of Cua
RULING:
YES. The elements of the crime of malversation of public funds are: (1) that the offender is a
public officer; (2) that he had the custody or control of funds or property by reason of the duties of
his office; (3) that those funds or property were public funds or property for which he was
abandonment or negligence, permitted another person to take them. In the present case, all the
elements are present and have been proven by the prosecution.
With respect to the first three elements, it has been established that petitioner was a revenue
collection agent of the BIR. He was a public officer who had custody of public funds for which he was
accountable. Anent the fourth element, such was established when the PNB confirmed that there was
a discrepancy in the amounts actually received by the PNB and the amounts stated in the receipts
reported by petitioner.
This Court has held that to justify conviction for malversation of public funds or property, the
prosecution has only to prove that the accused received public funds or property and that he could
not account for them, or did not have them in his possession and could not give a reasonable excuse
for their disappearance. An accountable public officer may be convicted of malversation even if there
is no direct evidence of misappropriation, and the only evidence is that there is a shortage in his
accounts which he has not been able to satisfactorily explain. In the present case, considering that
the shortage was duly proven by the prosecution, petitioner’s retaliation against the BIR for not
promoting him clearly does not constitute a satisfactory or reasonable explanation for his failure to
account for the missing amount.
CRIMES AGAINST PERSONS

Murder
PEOPLE OF THE PHILIPPINES v. ALVIN DEL ROSARIO

Treachery is employed to ensure the commission of the crime without the concomitant risk to
the aggressor.
At about 9:00 p.m., Edwin had a drinking spree with Salvador and Samson Gepiga in their
home at Barangay G. del Pilar, Bulan, Sorsogon. At some point during the said spree, Edwin went out
of the house to answer the call of nature. Angelita, the witness, was standing by the main door while
Edwin urinated when Alvin Del Rosario (Del Rosario) suddenly appeared and stabbed Edwin with a
machete. She immediately brought Edwin to Bulan Municipal Hospital; and then transferred him to
Sorsogon Provincial Hospital, where Edwin died.
Dr. De Castro found the cause of death as cardio-respiratory arrest, stab wound, and
hypovolemic shock. He explained that Edwin sustained a stab wound on the right upper quadrant
with laceration, the part of the intestine coming out, and damaged the following abdominal organs,
i.e., perforated lesser curvature of [the] stomach was thru and thru; perforated second part of [the]
duodenum, thru and thru; lacerated middle colic artery behind the stomach with extensive bleeding;
lacerated mesenteric vessels; and perforated ileum, thru and thru. Dr. De Castro opined that, based
on the location of the stab wound, the victim was in front of the assailant face to face with the latter
when attacked. However, it was also possible that the assailant was at the back of the victim by hitting
the anterior part from behind holding the patient.
The Regional Trial Court rendered a guilty verdict for the crime of Murder. Del Rosario, on
appeal argues that he should be made liable for homicide only. He claims that treachery did not attend
the killing of Edwin.
ISSUE:
Whether or not treachery attended the killing.
RULING:
YES. That treachery or alevosia was present is incontrovertible. The essence of this qualifying
circumstance is the sudden and unexpected attack by the assailant on an unsuspecting victim,
depriving the latter of any real chance to defend himself. It is employed to ensure the commission of
the crime without the concomitant risk to the aggressor.
Concededly, appellants attack, coming from behind, on the unarmed Edwin, was sudden,
unprovoked, unexpected, and deliberate. Edwin was in no position and without any means to defend
himself. By all indications, Edwin was left with no opportunity to evade the knife thrusts, to defend
himself, or to retaliate. In sum, the finding of treachery stands.
PEOPLE OF THE PHILIPPINES v. CHARLIE ABAÑO Y CAÑARES

G.R. No. 188323, 21 February 2011, THIRD DIVISION (Brion, J.)
Treachery qualified the killing to murder as the victim was asleep at the time of the assault; the
victim could not have possibly defended himself against his assailant.
Charlie Abaño (Abaño) was charged of the crime of murder for the death of Cesar Cabase
(Cabase). According to the witness and wife of Cabase, Richelda, the former was asleep together with
their youngest daughter Criselda, when suddenly Abaño entered their room focused a flashlight on
him and began hacking him with a bolo. Richelda retreated to the corned of the room while she
embraced their grandson. Thereafter, Abaño focused the flashlight on her but Criselda began to cry.
At that point, Abaño left.
During the arraignment, Abaño pleaded not guilty to the crime charged. He argued that
during the incident he was sleeping, hence, it is impossible for him to be in the house of Cabase. The
Regional Trial Court convicted him of the crime of murder. The Court of Appeals affirmed the
decision.
ISSUE:
Whether or not Abaño is guilty of the crime of murder.
RULING:
YES. The Court found no reason to disturb the findings of the RTC, as affirmed by the CA. The
eyewitness Richelda’s account of the incident is worthy of belief as it was a straight forward account
consistent with the presented physical evidence. The witness had no reason to falsify and she was
only interested in having the real killer punished; no motive affecting her credibility was ever
imputed against her. On the other hand, the Abaño failed to show by convincing evidence that it was
physically impossible for him to have been at the scene of the crime during its commission; he was
only a short 300 meters away.
Treachery qualified the killing to murder as the victim was asleep at the time of the assault;
the victim could not have possibly defended himself against his assailant. Since neither aggravating
nor mitigating circumstances attended the commission of the felony, the lower courts properly
imposed the penalty of reclusion perpetua.
PEOPLE OF THE PHILIPPINES v. ROMEO ANCHES

Although the attack on the victim was frontal, it was deliberate, sudden and unexpected,
affording the hapless, unarmed and unsuspecting victim no opportunity to resist or to defend himself.
Romeo Anches was charged with the crime of murder with the qualifying circumstance of
treachery. According to witness, Manuel Pomicpic, he saw the victim Vicente Pabalay standing in a
waiting shed when Romeo Anches and Edgardo Cruz riding in a motorcycle, stopped in front of
Pabalay and asked him to ride the motorcycle and he will bring him to the place where the victim will
be going. Pabalay refused the offer and went to the other side of the highway, the victim stopped. As
he turned around, Anches shot him several times. Pabalay then asked for help in nearby house owned
by Nilda Pimicpic, who asked Pabalay who shot him. Pabalay answer Anches did.
Upon arraignment, Anches pleaded not guilty contending that he was not in the area when
the crime happened. The Regional Trial Court convicted Anches with the crime charged. The Court of
Appeals affirmed the decision.
ISSUE:
Whether or not the qualifying circumstance of treachery is tenable even if the victim was shot
frontal.
RULING:
YES. The Court found no reason to disturb the findings of the RTC, as affirmed by the CA. The
records are replete with evidence establishing Anches’ guilt beyond reasonable doubt. The
eyewitness account of Manuel Pomicpic, supported by the victim’s antemortem statement, is more
plausible than Anches’ alibi. Both the RTC and the CA correctly appreciated the qualifying
circumstance of treachery; although the attack on the victim was frontal, it was deliberate, sudden
and unexpected, affording the hapless, unarmed and unsuspecting victim no opportunity to resist or
to defend himself. The appellant was correctly sentenced to suffer the penalty of reclusion perpetua
since there was no aggravating circumstance attending the commission of the crime. To conform to
recent jurisprudence, however, we increase the awarded exemplary damages from P25,000.00 to
P30,000.00.
PEOPLE OF THE PHILIPPINES v. ROSENDO REBUCAN y LAMSIN

There is treachery when the offender commits any of the crimes against the person, employing
means, methods, or forms in the execution thereof which tend directly and specially to insure its
execution, without risk to himself arising from the defense which the offended party might make.
Rosendo Rebucan (Rosendo) was charged with the crime of double murder for stabbing 65-
year old Felipe Lagera (Felipe) and his one-year old grandchild Ranil Tagpis (Ranil) with a bolo.
Felipe sustained three hacking wounds while Ranil was stabbed because Felipe was holding him in
his arms when Rosendo stabbed him (Felipe) the second time. It appears that Rosendo was avenging
his wife’s sexual molestation by Felipe and his son. The Regional Trial Court (RTC) convicted Rosendo
as charged. The Court of Appeals (CA), however, convicted Rosendo with two separate crimes of
murder as the evidence of the prosecution failed to prove the existence of a complex crime of double
murder.
ISSUE:
1. Whether or not the lower courts properly appreciated the qualifying circumstance of
Treachery.
2. Whether or not Roesndo should be convicted of two separate counts of murder
RULING:
1. YES. In the instant case, the evidence of the prosecution established the fact that the killings
of Felipe and Ranil were attended by treachery, thus qualifying the same to murder.
As can be gleaned from her testimony, Carmela firmly and categorically pointed to Rosendo
as the person who entered the house of Felipe. She clearly stated that the attack was not preceded
by any fight or altercation between Rosendo and Felipe. Without any provocation, Rosendo suddenly
delivered fatal hacking blows to Felipe. The abruptness of the unexpected assault rendered Felipe
defenseless and deprived him of any opportunity to repel the attack and retaliate. As Felipe was
carrying his grandson Ranil, the child unfortunately suffered the same fatal end as that of his
grandfather. In the killing of Ranil, the trial court likewise correctly appreciated the existence of
treachery. The said circumstance may be properly considered, even when the victim of the attack
was not the one whom the defendant intended to kill, if it appears from the evidence that neither of
the two persons could in any manner put up defense against the attack or become aware of it.
Furthermore, the killing of a child is characterized by treachery even if the manner of assault is not
shown. For the weakness of the victim due to his tender years results in the absence of any danger
to the accused.
2. YES. The Court agrees with the appellate court that Rosendo should be held liable for two
(2) separate counts of murder, not the complex crime of double murder. Article 48 of the Revised
Penal Code provides that “[w]hen a single act constitutes two or more grave or less grave felonies, or
when an offense is a necessary means for committing the other, the penalty for the most serious
crime shall be imposed, the same to be applied in its maximum period.” There are, thus, two kinds of
complex crimes. The first is known as compound crime, or when a single act constitutes two or more
grave or less grave felonies. The second is known as complex crime proper, or when an offense is a
necessary means for committing the other. The Court finds that there is a paucity of evidence to
prove that the instant case falls under any of the two classes of complex crimes. The evidence of the
prosecution failed to clearly and indubitably establish the fact that Felipe and Ranil were killed by a
single fatal hacking blow from Rosendo. The eyewitness testimony of Carmela did not contain any
detail as to this material fact. To a greater degree, it was neither proven that the murder of Felipe
was committed as a necessary means for committing and/or facilitating the murder of Ranil and vice
versa. As the factual milieu of the case at bar excludes the application of Article 48 of the Revised
Penal Code, Rosendo should be made liable for two separate and distinct acts of murder.
PEOPLE OF THE PHILIPPINES v. LARRY TORRES, SR.

G.R. No. 190317, 22 August 2011 THIRD DIVISION (VELASCO, JR., J.)
The elements of treachery are: (1) the employment of means of execution that gives the person
attacked no opportunity to defend himself or to retaliate; and (2) the means of execution was deliberate
or consciously adopted.
In this case, Larry Torres Sr. (Torres) is accused of the crime of murder. The prosecution
presented the evidence that Torres was with his friends and Santonia, the victim on a drinking spree
in one of their friend’s houses. Upon handing Santonia the drink however, there was a ruckus and
what was revealed was that there was an argument between the two. Not wanting to add flame to
the heated argument, Santonia opted to get out of the house and rest. He was however shot from
behind by Torres in the head and was declared dead upon arrival.
The defense however denied these allegations and instead averred that Santonia pointed a
gun at him. Torres was provoked and not wanting to be put in peril, the two struggled for the gun so
that it would not be fired upon the other. The gun fired in the direction of Santonia which fatally
wounded him. He also presented that he had a good relationship with the Santonias. The Regional
Trial Court (RTC) convicted Torres of the crime of murder qualified by treachery. It was affirmed by
the Court of Appeals (CA).
ISSUE:
Whether or not Torres is guilty of murder by treachery
RULING:
YES. The qualifying circumstance of treachery is present when the offender commits any of
the crimes against persons, employing means, methods or forms in its execution which tend directly
and especially to ensure its execution, without risk to himself or herself arising from any defense
which the offended party might make The elements of treachery are: (1) the employment of means
of execution that gives the person attacked no opportunity to defend himself or to retaliate; and (2)
the means of execution was deliberate or consciously adopted.
In this case, there was treachery when Santonia who was on his way back home did not do
even any provocation to warrant the firing of the gun. Torres exploited that weakness and
opportunity to inflict hurt upon Santonia so that the latter could not afford any defense or retaliation.
PEOPLE OF THE PHILIPPINES v. CLEOFE BAROQUILLO

G.R. No. 184960, 24 August 2011 FIRST DIVISION (LEONARDO-DE CASTRO, J.)
The qualifying circumstance of treachery is present when the offender commits any of the crimes
against persons, employing means, methods or forms in its execution which tend directly and especially
to ensure its execution, without risk to himself or herself arising from any defense which the offended
party might make.
Cleofe Baroquillo is accused of the crime of murder by way of treachery wherein the
prosecution was able to present and subsequently prove the evidence that Baroquillo is involved in
an affair with a woman who is married, namely, Lorenza Madeloso. As the amorous relationship
blossomed, Baroquillo wanted to have the husband of Madeloso killed. Baroquillo enlisted the help
of another man, Leonardo in which they were able to corner Madeloso’s husband, Nelson. Baroquillo
held Nelson who struggled but his efforts were only futile when Leonardo was able to fire the trigger
that immediately ended the life of Madeloso’s husband. It was averred by the prosecution that
Madeloso’s cries were feigned and not genuine when she saw her deceased husband.
The defense denied the allegations and instead interposed the defense of alibi that it would
be impossible for them to commit the crime since they were in another locality to attend a birthday
party.
ISSUE:
Whether or not Baroquillo should be guilty of the crime of murder by way of treachery.
RULING:
YES. The qualifying circumstance of treachery is present when the offender commits any of
the crimes against persons, employing means, methods or forms in its execution which tend directly
and especially to ensure its execution, without risk to himself or herself arising from any defense
which the offended party might make
It was established in this case that Nelson was attacked with treachery because aside from
having had no idea of what was to befall him when he stood up as Cleofe and Leonardo approached
him, Nelson was also defenseless against the sudden gunshots Leonardo delivered to him. The fact
that the attack on Nelson was frontal does not preclude the presence of treachery in this case as the
same made the attack no less unexpected and sudden.
PEOPLE OF THE PHILIPPINES v. ANGELINO YANSON

For treachery to be considered, two elements must concur: (1) the employment of means of
execution that gives the persons attacked no opportunity to defend themselves or retaliate; and (2) the
means of execution were deliberately or consciously adopted.
In the afternoon of May 12, 1991, Elmo Galfo (Galfo) and the victim, Carlito Magan (Magan),
were drinking whisky in the store of a certain Lorna Tamson (Tamson). After a while, they were
joined by Angelino Yanson (Yanson) and Salcedo. They finished drinking at around 8:45 in the
evening after which Galfo and Magan walked home together. After traversing a distance of about half
a kilometer, Galfo noticed two persons following them, one of whom suddenly stabbed Magan at the
back. Galfo positively identified the Yanson as the person who stabbed Magan. Galfo tried to approach
the Magan but Yanson and his companion, Salcedo, rushed towards him thus prompting him to run
away for safety. While running, however, he managed to look back and saw Yanson and Salcedo stab
the victim some more. According to Dr. Edgardo Jabasa, the Provincial Health Officer of Guimaras, the
victim suffered eight stab wounds, two of which were fatal and were inflicted at the back.
ISSUE:
Whether or not Yanson is guilty of murder
RULING:
YES. There is treachery when the offender commits any of the crimes against persons,
employing means, methods, or forms in the execution, which tend directly and specially to insure its
execution, without risk to the offender arising from the defense which the offended party might make.
The essence of treachery is that the attack comes without a warning and in a swift, deliberate, and
unexpected manner, affording the hapless, unarmed, and unsuspecting victim no chance to resist or
escape. For treachery to be considered, two elements must concur: (1) the employment of means of
execution that gives the persons attacked no opportunity to defend themselves or retaliate; and (2)
the means of execution were deliberately or consciously adopted.
The prosecution established that appellant suddenly stabbed the victim from behind thereby
giving him no opportunity to resist the attack or defend himself. As correctly observed by the
appellate court: It is apparent that there was treachery in the killing of [Magan]. As surely testified
by [Galfo], [appellant] followed the unsuspecting victim when he was going home and thereafter,
deliberately stabbed him in the back which resulted in the falling of [Magan] to the ground and
rendering him defenseless to [appellant's] further attacks. Verily, [appellant] employed means which
insured the killing of [Magan] and such means assured him from the risk of [Magan's] defense had he
made any. It must also be noted that [Magan] was stabbed four times in the back and two of these
wounds were the proximate cause of his death. Stabbing from behind is a good indication of
treachery.
PEOPLE OF THE PHILIPPINES v. MICHAEL BOKINGCO alias MICHAEL BOKINGCO and

REYNANTE COL
G.R. No. 187536, 10 August 2011, SECOND DIVISION, (Perez, J.)
In evident premeditation, it is indispensable to show how and when the plan to kill was hatched
or how much time had elapsed before it was carried out.
Prosecution’s witness Dante Vitalicio testified that he saw Michael Bokingco enter the house
of Noli Pasion. A few minutes later, he heard a commotion from Pasion’s apartment. He headed to
said unit to check. He saw Bokingco hitting something on the floor. Upon seeing Vitalicio, Bokingco
allegedly attacked him with a hammer in his hand. A struggle ensued and Vitalicio was hit several
times. Vitalicio managed to push Bokingco away. Bokingco tried to chase Vitalicio but was eventually
subdued by a co-worker. Reynante Col, on the other hand, went after Elsa, the wife of Noli Pasion. He
forced her to open the vault at the pawnshop. However, since Elsa did not know the lock combination,
Col was unsuccessful. Pasion and Vitalicio were brought to the hospital. Pasion expired a few hours
later while Vitalicio was treated for his injuries.
During the prelimnary investigation, Bokingco admitted that he conspired with Col to kill
Pasion and that they planned the killing several days before because they got fed up with Pasion. The
Regional Trial Court found Bokingco and Col guilty of murder. The Court of Appeals affirmed the
findings of the trial court but reduced the penalty to reclusion perpetua in view of Republic Act No.
7659.
ISSUE:
Whether the qualifying circumstances of evident premeditation was properly appreciated to

convict Bokingco of murder
RULING:
NO. There is no question that BOKINGCO attacked and killed Pasion. Bokingco made two
separate and dissimilar admissions: first, in his extrajudicial confession taken during the preliminary
investigation where he admitted that he and Col planned the killing of Pasion; and second, when he
testified in open court that he was only provoked in hitting Pasion back when the latter hit him in the
head. On the basis of his extrajudicial confession, Bokingco was charged for murder qualified by
evident premeditation and treachery.
Bokingco admitted in open court that he killed Pasion. But the admitted manner of killing is
inconsistent with evident premeditation. To warrant a finding of evident premeditation, the
prosecution must establish the confluence of the following requisites: (a) the time when the offender
was determined to commit the crime; (b) an act manifestly indicating that the offender clung to his
determination; and (c) a sufficient interval of time between the determination and the execution of
the crime to allow him to reflect upon the consequences of his act. It is indispensable to show how
and when the plan to kill was hatched or how much time had elapsed before it was carried out. In
the instant case, no proof was shown as to how and when the plan to kill was devised. Bokingco
admitted in court that he only retaliated when Pasion allegedly hit him in the head. Despite the fact
that Bokingco admitted that he was treated poorly by Pasion, the prosecution failed to establish that
Bokingco planned the attack.
Also, it was during the preliminary investigation that Bokingco mentioned his and Cols plan
to kill Pasion. Bokingco’s confession was admittedly taken without the assistance of counsel in
violation of Section 12, Article III of the 1987 Constitution. A downgrade of conviction from murder
to homicide is proper for Bokingco for failure of the prosecution to prove the presence of the
qualifying circumstances.
Homicide
PEOPLE OF THE PHILIPPINES v. RODEL LANUZA

G.R. No. 188562, 17 August 2011 FIRST DIVISION (Leonardo-De Castro, J.)
Evidence to prove intent to kill in crimes against persons may consist, inter alia, of the means
used by the malefactors; the nature, location and number of wounds sustained by the victim; the conduct
of the malefactors before, at the time of, or immediately after the killing of the victim; the circumstances
under which the crime was committed; and the motive of the accused.
Rodel Lanuza (Lanuza) is accused of the crime of frustrated homicide. The prosecution was
able to present the evidence that the victim is an outgoing security guard while Lanuza was the
incoming security guard. The victim placed the gun, together with one bullet, on top of the security
guard’s table. Although he was turning over six bullets to the Lanuza, the victim asserted that the five
others were inside a drawer on the security guard’s table at their office upstairs. The victim inquired
to Lanuza why the latter was not able to report to the shift that had been given to him but instead got
a reply with a shot to the buttocks. Lanuza attempted to fire a second time but was unable to do so, it
only ticked. The victim was able to secure treatment from a nearby hospital when he struggled to
ride his motorcycle. The Regional Trial Court (RTC) found Lanuza guilty of the crime charged and
was likewise affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not there was intent to kill and that Lanuza is guilty of frustrated homicide.
RULING:
YES. The elements of frustrated homicide are: (1) the accused intended to kill his victim, as
manifested by his use of a deadly weapon in his assault; (2) the victim sustained fatal or mortal
wound/s but did not die because of timely medical assistance; and (3) none of the qualifying
circumstance for murder under Article 248 of the Revised Penal Code, as amended, is
present.Evidence to prove intent to kill in crimes against persons may consist, inter alia, of the means
used by the malefactors; the nature, location and number of wounds sustained by the victim; the
conduct of the malefactors before, at the time of, or immediately after the killing of the victim; the
circumstances under which the crime was committed; and the motive of the accused. In this case, the
intent was proven by the use of a gun which is a lethal weapon and the subsequent act of the accused
to pull the trigger the second time which indicates an intent to kill the victim.
The prosecution has satisfactorily proven that accused-appellant intended to kill private
complainant based on the method of attack, the weapon used, and the location of the gunshot wound.
Accused-appellant shot private complainant with a shotgun at close range hitting the latters
abdomen. Resultantly, private complainant sustained a wound that could have caused his death if not
for the timely medical attention given to him. As aptly elaborated by the RTC: The medical certificate
shows that the gunshot hit the body of the private complainant, causing injuries to his spleen and left
kidney. In fact, the hemopentoneum referred to therein means that there was bleeding inside his
abdomen and that 100 cc of blood was taken from it. As a result, the attending physician had to
operate on him, repair his spleen and place a drain in the vicinity of the kidney. Moreover, the private
complainant had to be confined at the provincial hospital for twelve days, a fact underscoring the
gravity of his condition. Clearly, one does not have to be a physician to realize that a person would
die if the said injuries would remain untreated. Accordingly, the accused must be deemed to have
performed the last act necessary to kill the private complainant.
Rape
PEOPLE OF THE PHILIPPINES v. JERWIN QUINTAL y BEO, VICENTE BONGAT y TARIMAN,

FELIPE QUINTAL y ABARQUEZ and LARRY PANTI y JIMENEZ
There is a guideline provided by jurisprudence in scrutinizing the testimony of the victim,

namely: (a) while an accusation for rape can be made with facility, it is difficult to prove but more
difficult for the person accused, though innocent, to disprove;(b) in view of the intrinsic nature of the
crime of rape where only two persons are usually involved, the testimony of the complainant must be
scrutinized with extreme caution; and (c) the evidence for the prosecution must stand or fall on its own
merits and cannot be allowed to draw strength from the weakness of the evidence of the defense.
Vicente Bongat (Bongat), together with 15-year old Jerwin Quintal y Beo (Jerwin), 16-year
old Felipe Quintal y Abarquez (Felipe) and Larry Panti y Jimenez (Larry) were charged in an
Information for Rape. AAA narrated that on 29 August 2002 at around 9:45 p.m., she attended a wake
in Barangay YYY, Virac, Catanduanes. Upon leaving the wake to go to her grandmother’s house in
Barangay XXX, she noticed that Jerwin was following her. AAA recognized Jerwin because they go to
the same school. When she was about to enter the house of her grandmother, Jerwin and Felipe, who
were with a certain Maria, approached AAA and invited her to attend a birthday party. AAA acceded
and went with the trio towards Barangay ZZZ. They went inside a dark nipa hut near a rice field and
AAA saw Vicente and Larry thereat. AAA was then made to sit on a bench by Felipe and the four
accused went to converse with each other outside the nipa hut. When the accused came back, they
covered her mouth with a handkerchief, and tied her hands and feet to the posts with a nylon string.
The accused watched in delight while each of them took turns in raping her. Jerwin ravished her twice
while the rest of the accused raped her once. After they finished with AAA, Jerwin untied her hands
and feet. Vicente and Larry went home while Jerwin and Felipe accompanied AAA to her
grandmother’s house.
For the defense, Bongat assails the credibility of AAA’s testimony. He insists that it was
impossible for AAA to have clearly and positively identified him as one of the perpetrators
considering that AAA claimed that it was very dark inside the nipa hut where she was supposedly
raped. Bongat assails the testimony of AAA that she went with Jerwin to a place unknown to her,
despite not personally knowing him. Bongat claims this incredibility in her testimony created serious
doubt as to the reliability of her allegations. Appellant argues that contrary to AAAs allegations, there
was no clear intent on her part to resist the alleged sexual acts. AAA failed to shout for help. Neither
did she present any proof of body injuries to clearly prove that she resisted the alleged rape.
Moreover, AAA told her mother about the incident only because the latter noticed her to have been
walking in an unusual manner. Bongat asserts that he should have been convicted only of simple
seduction as conspiracy was not proven among the accused.
ISSUE:
Whether or not Bongat was guilty of rape.
RULING:
NO. Upon a careful scrutiny of the records of this case, this Court is not convinced beyond
reasonable doubt that appellant, as well as the other accused, committed the crime of rape against
AAA. First, AAA testified that she does not personally know Jerwin and Felipe. However, when the
two allegedly invited her to go with them to a party, she readily accepted the invitation and in fact,
went with them. Moreover, AAA was seen playing cards with Jerwin and his group in the wake, as
testified by Maria, Felipe, Jerwin and Federico. Second, AAA recounted that the nipa hut where she
was brought by the accused was very dark. And yet, AAA readily identified Vicente and Larry inside
the hut, as two of those who raped her. Incidentally, it was unclear how AAA was able to identify
Vicente and Larry because she was never asked, not by the prosecution nor the defense, on how she
came to know the two accused. Third, the medical certificate only contained one finding, that there
was a round-the-clock abrasion in the labia minora. This is not at all conclusive nor corroborative to
support the charge of rape. At most, this indicates that AAA had sexual intercourse. We find the
medical finding lacking in relation to the testimony of AAA on how she was ravished by four men.
Although a medical examination is not an indispensable element in a prosecution of rape, it could
have corroborated an otherwise vague and dubious testimony of the victim. In fact, Dr. Tatad
admitted that he only examined AAA’s private parts based on her statement that she was raped.
Furthermore, in her sworn statement before the police, AAA related that her mouth was injured. She
also testified in court that her hands and feet were tied to a post by a nylon string. Naturally, AAA
would have sustained injuries in her hands and feet. But all these injuries were never examined by
the medico-legal officer nor did AAA allege the existence of those injuries.
Fourth, AAA’s belated reporting of the rape incident has relevance in this case, especially
when it appears that she really had no intention at all to inform her mother, not until the latter
actually asked her why she was walking in an unusual manner. Fifth, BBB allegedly went to the
Barangay Kagawad and the Tanod, who happens to be her cousin, to report the rape incidents.
However, when Fernando and Eddie testified, they claimed that they were initially informed by BBB
about a marriage proposal by Jerwin’s parents. It was only during the meeting that they learned about
the alleged rape. Sixth, to fuel further suspicion as to whether a rape incident actually transpired,
BBB never bothered to ask AAA about the whole incident. She accepted AAAs testimony hook, line
and sinker. In the same breadth, it can be recalled that Eddie, the Barangay Tanod, testified that BBB
dictated to him what was written in the yellow paper which contained the supposed admissions of
rape by the accused. Eddie did not appear to have asked or interrogated the accused about the
incident. Likewise, Dr. Tatad merely examined AAAs private parts on the basis of her claim that she
was raped. Seventh, in an unusual twist, records show that AAA was seen visiting Jerwin in jail for at
least six (6) times. These incidents are documented in a logbook presented in court by the defense
and which was not refuted by the prosecution.
THE PEOPLE OF THE PHILIPPINES v. JOSE GALVEZ y BLANCA,

G.R. No. 181827, 02 February 2011, FIRST DIVISION (Leonardo-De Castro, J.)
We have consistently held that actual force or intimidation need not be employed in incestuous
rape of a minor.
Around 12:00 o’clock midnight, AAA was in their house in Bulacan. While she was sleeping,
Jose Galvez (Galvez) crawled beside her and inserted his penis in her vagina. She pushed Galveez but
the latter threatened her with a knife which he poked at her side. He told her not to tell anyone. After
inserting his penis in her vagina, he touched her breasts. She told the pastor of her church about the
incident sometime in June during a church service. She and her pastor thereafter went to the police
station to give her statement, which she identified in Court. She testified that this was the first time
that accused raped her.
AAA also testified that the June 21, 2002 incident was not the first time that the accused raped
her. She testified that she has been raped several times but she could not remember the dates. Her
grandfather raped her many times, almost every day since she was thirteen (13) years old up to when
she was fourteen (14) years old. Even so, she only reported the incident to her aunt in 2002 because
she could not bear what Galvez was doing to her. Galvez was convicted only on the incident that
happened on June 21, 2002 but was acquitted with the other rape charges.
Hence, on appeal, Galvez claims that like the rest of the charges against him, the complaint
under Criminal Case No. 3094-M-2002 should suffer the same fate. According to him, the discrepancy
in AAAs testimony on March 31, 2003 and that on February 2, 2004 as to whether she was raped
before June 21, 2002 goes into her credibility and candor. Galvez likewise attacks AAA’s credibility
on the ground that the physical evidence presented yielded no proof of external signs of physical
injuries, implying that this negates the contention that AAA was raped.
ISSUE:
Whether or not the fact that there are no proof of external signs of physical injuries negates
the fact of rape.
RULING:
NO. The shallow healed laceration at 9:00 o’clock position on complainant’s hymen,
presented in the testimony of Dr. Viray, is in fact convincing physical evidence of the rape, especially
considering the age of AAA and the fact that accused-appellant used a knife to threaten her. Thus, in
People v. Cuadro, the Court has held: Further, the medical findings of Dr. Obedoza are indicative of
rape. It is not indispensable that marks of external bodily injuries should appear on the victim of rape.
Considering that in the commission of the first, second and third rapes, appellant threatened the
victim with a knife, it is logical that no external injuries would appear on her body. What is more
telling is that the victim, at her young age, sustained lacerations in her genitalia. The Court have ruled
that lacerations, whether healed or fresh, are the best physical evidence of forcible defloration.
More importantly, even if we assume for the sake of argument that AAA did not put up a
struggle against accused-appellant, the Court have consistently held that actual force or intimidation
need not be employed in incestuous rape of a minor. Thus, in the case at bar, the moral and physical
dominion of the ascendant is sufficient to take the place of actual force or intimidation.
PEOPLE OF THE PHILIPPINES v. ERNESTO FRAGANTE y AYUDA

The absence of violence or offer of resistance would not affect the outcome of the case because
the overpowering and overbearing moral influence of the father over his daughter takes the place of
violence and offer of resistance required in rape cases committed by an accused who did not have blood
relationship with the victim.
In this case, in ten Informations were filed on 14 July 1998, Ernesto (Fragante) was charged
with nine (9) counts of acts of lasciviousness and one (1) count of rape all committed against his own
minor daughter AAA. The incidents happened sometime in April 1993 to May 1993, sometime
between June 1993 and August 1993, between October 1993 and December 1993, sometime in
January 1994, August-September 1994, when AAA was around twelve (12) years old, and in
September 1995, at the age of thirteen (13), AAA was raped by her father Ernesto. In the evening of
October 25, 1997, her father started massaging her breast and AAA removed his hands and stood up
but she was bitten and pushed towards the bed. Her father strangled her and asked whether she
preferred to be strangled first and she answered no. He started touching her private parts again and
this time she continued warding off his hands and when she heard their car entering their garage,
she told her father that her mother had arrive. That was the only time she was allowed to leave but
was stopped by her father and warned not tell her mother what happened.
During arraignment on April 26, 1999, the accused entered separate pleas of Not Guilty to all
the crimes charged. Joint trial ensued thereafter. The prosecution presented the following witnesses:
[AAA], BBB, CCC, and Dr. Bernadette Madrid. The defense presented Ernesto Fragante as the sole
witness.
ISSUE:
Whether or not Ernesto is guilty of the nine (9) counts of acts of lasciviousness and one (1)
count of rape.
RULING:
The Court sustains appellant's conviction for seven (7) counts of acts of lasciviousness and
one (1) count of rape. The Court acquits appellant for two (2) counts of acts of lasciviousness on the
ground of reasonable doubt. It must be stressed that the gravamen of rape is sexual congress with a
woman by force and without consent. In People v. Orillosa, we held that actual force or intimidation
need not be employed in incestuous rape of a minor because the moral and physical dominion of the
father is sufficient to cow the victim into submission to his beastly desires.14 When a father commits
the odious crime of rape against his own daughter, his moral ascendancy or influence over the latter
substitutes for violence and intimidation. The absence of violence or offer of resistance would not
affect the outcome of the case because the overpowering and overbearing moral influence of the
father over his daughter takes the place of violence and offer of resistance required in rape cases
committed by an accused who did not have blood relationship with the victim. In this case, AAA's
testimony clearly showed how appellant took advantage of his relationship with and his moral
ascendancy over his minor daughter when he had carnal knowledge of her. As found by the Court of
Appeals, appellant instilled fear on AAA's mind every time he sexually molested her.
For the case on Acts of Lasciviousness, first, appellant's repeated touching, fondling, and
sucking of AAA's breasts and inserting his finger into AAA's vagina with lewd designs undoubtedly
constitute lascivious conduct under Section 2(h) of the Implementing Rules and Regulations of
Republic Act No. 7610. Second, appellant, as a father having moral ascendancy over his daughter,
coerced AAA to engage in lascivious conduct, which is within the purview of sexual abuse. Third, AAA
is below 18 years old at the time of the commission of the offense, based on her testimony which was
corroborated by her Birth Certificate33 presented during the trial. Since all three elements of the
crime were present, the conviction of appellant for acts of lasciviousness was proper.
PEOPLE OF THE PHILIPPINES v. EVILIO MILAGROSA

It is well settled that an accused may be convicted of rape based solely on the testimony of the
victim, as long as she is competent and credible.
On March 3, 2004, at around 7:00 in the morning, in the Province of Quezon, 16-year old AAA
was alone in their house and had just finished washing the dishes when a person (later identified as
Evilio Milagrosa) came. Evilio grabbed AAA and forcibly carried her to a grassy area outside the
house. AAA struggled but Evilio, who was stronger, prevailed. She was also frightened when she
noticed a balisong tucked at Evilio’s waist. Evilio removed AAA’s clothes, inserted his penis into her
vagina, thereby consummating sexual intercourse with AAA. Evilio thereafter left, cautioning AAA
not to tell anyone about the incident
Evilio was charged with the crime of rape. However, he argues that he could not have carried
AAA to the grassy area as she insisted; it was 7:00 in the morning and the neighbors would have
heard her screams. She could also have easily grabbed his balisong and struck him with it. Finally, he
raised alibi as his defense stating that he was in Camp Crame at that time.
The prosecution presented AAA as its sole witness. AAA testified that she had known Evilio
for a long time as he was a friend of her father. She added that their house is in an isolated place; from
there, she cannot even see the house of their nearest neighbor. The Regional Trial Court convicted
Evilio, the court found the testimony of AAA as credible. The Court of Appeals affirmed the decision.
ISSUE:
Whether or not Evilio is guilty of the crime of rape.
RULING:
YES. The Court found no reason to disturb the findings of the RTC that the CA wholly affirmed.
It is well settled that an accused may be convicted of rape based solely on the testimony of the victim,
as long as she is competent and credible. The unique nature of the crime of rape (which is usually
committed in a private place where only the perpetrator and the rape victim are present) allows this
evidentiary approach and the conclusion the lower courts reached.
The defense of alibi, presented with no corroborating evidence, also deserves scant
consideration. The Court noted in this regards that no record or any witness attesting to the presence
of the accused at Camp Crame at the time of the incident, was ever presented. Between the positive
and straightforward testimony of AAA and Evilio’s defense of alibi, the victim’s testimony deserves
great evidentiary weight. Lastly, to conform with recent jurisprudence, the Court modified the CA
decision and award exemplary damages in the amount of P30,000.00 on account of the moral
corruption, perversity and wickedness of the accused, who is 55 years old, in sexually assaulting a
16-year old girl.
PEOPLE OF THE PHILIPPINES v. PORFERIO MASAGCA, JR. Y PADILLA

Incestuous rape is not an ordinary crime that can be easily invented because of its heavy
psychological toll. It is unlikely that a young woman of tender years would be willing to concoct a story,
which would subject her to a lifetime of gossip and scandal among neighbors and friends and even
condemn her father to death.
Porferio Masagca (Masagca) and four of his children including AAA lived in Barangay Sto.
Domingo, Virac, Catanduanes. At around seven o’clock on the evening of September 10, 2000, after
his other children had left to watch a TV program, the Masagca laid down beside his daughter AAA,
removed her blanket, and held her right hand. He, thereafter, removed her short pants and
underwear, laid on top of her, and inserted his penis into her vagina for about one minute.
Throughout the incident, AAA did not say anything as the appellant threatened to hit her on the
mouth if she would make any noise.
Another incident transpired when Masgaca and his children this time resided at his parents’
home in Barangay J.M. Alberto (Poniton), Virac, Catanduanes. At around ten o’clock in the evening,
AAA was awakened by her father’s arrival. He removed her shorts and underwear as he lowered his
own shorts and underwear to his knees, and managed to insert at least an inch of his penis into her
vagina for one minute. AAA’s struggle proved fruitless as he tightly held her right hand. Again, he
threatened to hit her on the mouth if she reported the incident to anyone.
AAA’s experience with her father was repeated on October 14, 2001, at around ten o’clock in
the evening in the same house. AAA recalled that her father again inserted his penis into her vagina
for one minute and moved his buttocks. She struggled, but her father was far stronger. This time,
Magsaca did not say anything to her. Seven days later, AAA revealed her ordeals to her aunt. This
disclosure led to charges against Magsaca for three (3) counts of rape. Masagca denied the allegations
against him contesting that he was working in Alybay during the dates when the crime was
commited. The Regional Trial Court convicted Masagca with three counts of rape. The Court of
ISSUE:
Whether or not Masagca is guilty of rape.
RULING:
YES. The Court held that the prosecution successfully established the elements of rape. AAA
positively identified Masagca as her rapist. In rape cases, the accused may be convicted solely on the
testimony of the victim, provided it is credible, convincing, and consistent with human nature and
the normal course of things. The examination of the records shows no indication that the should view
AAA’s testimony in a suspicious light. The doctrine in People v. Efren Maglente y Cervantes finds
particular application in this case: When the offended party is a young and immature girl testifying
against a parent, courts are inclined to lend credence to her version of what transpired. Youth and
immaturity are given full weight and credit. Incestuous rape is not an ordinary crime that can be
easily invented because of its heavy psychological toll. It is unlikely that a young woman of tender
years would be willing to concoct a story, which would subject her to a lifetime of gossip and scandal
among neighbors and friends and even condemn her father to death.
Masagca’s defenses of denial cannot prevail over AAA’s testimony that she had been raped
and her positive identification of Masagca as her rapist. Denial and alibi are the weakest of all
defenses because they are easy to concoct and fabricate. To be believed, denial must be supported by
a strong evidence of innocence; otherwise, it is regarded as purely self-serving. Alibi, on the other
hand, is rejected when the prosecution sufficiently establishes the identity of the accused. The facts
in this case do not present any exceptional circumstance warranting a deviation from these
established rules.
PEOPLE OF THE PHILIPPINES v. JENNY TUMAMBING y TAMAYO

If the victim’s testimonies raise serious doubts and inconsistencies especially regarding the
identity of the suspect, the Court cannot affirm the conviction of the accused.
DK, the complainant testified that at around 2:00 a.m. on June 26, 2004, somebody entered
the room and poked a knife at DK threatening to kill her if she made any noise. He removed DK’s
clothes and undressed himself. He then succeeded in ravishing her. When he was about to leave, DK
turned the lights on and saw his face. DK then recognized him as the person who passed by her
cousin’s room several times in the afternoon of the previous day. She identified the man to be Jenny
Tumambing (Tumambing). The doctor who examined DK found several fresh lacerations on her
genitals. When the police arrested Tumambing, he denied committing the crime stating that he slept
over the house of his employer, and went to bed at about 9:00 p.m. and woke up at around 6:00 a.m.
The Regional Trial Court (RTC) found Tumambing guilty beyond reasonable doubt of the
crime charged and the same was affirmed by the Court of Appeals (CA) saying that her testimony was
categorical and even cited People v. Reyes where the Court ruled that it would be easy for a person
who gained familiarity with the appearance of another to identify the latter even from a distance.
ISSUE:
Whether or not the circumstances mentioned by DK are sufficient to convict Tumambing of
the crime of Rape
RULING:
NO. In order for there to be a successful prosecution of a criminal action, two things must be
proven. First is the identification of the author and his actual commission of the crime. An ample
proof that a crime has been committed has no use if the prosecution is unable to convincingly prove
the offender’s identity. Hence, the consitutional presumption of innocence is not demolished. In the
present case, both the RTC and the CA gave credence to DK’s testimony, but the courts mentioned
appear to have overlooked or misinterpreted certain critical evidence in the case. The Court’s reading
of her testimony shows her reluctance and uncertainty in identifying the suspect when the barangay
chairman arranged for her to meet Tumambing.
DK’s reaction upon seeing Tumambing seemingly contradicts her statement that she was
indeed familiar with Tumambing. If she really recognised Tumambing as the author of the crime, her
natural reaction would be one of outright fury or some revealing emotion, and not reluctance in
pointing to him despite the chairman’s assurance that she would be protected. Moreover, there was
also another suspect other than Tumambing named Alvin Quiatcho. In the confrontation between her
and Quiatcho, she also said that she could not recall, and even suggested that Quiatcho give his sperm
in order for it to be tested hence, entertaining the possibility that Quiatcho might have been the one
who raped her and not Tumambing who she identified as the man who violated her and that she
could not be mistaken in identifying that it was Tumambing. Moreover, Crispin Dizon, an executive
officer of the same barangay corroborated the barangay chairman’s testimony.
The testimonies of neutral witnesses to the confrontation between DK and Tumambing prove
that she was quite reluctant in pointing to the author of the crime committed. She was even asked
four times with the reassurance of protection, but she failed to answer with the proper conviction.
DK also did not refute the testimonies of the neutral witnesses that she could not point to the accused
Tumambing as her rapist during their initial confrontation. By the nature of rape, the court has to
rely more often on the sole testimony of the victim. For this reason, courts always subject the victim’s
testimony to the most rigid and careful scrutiny. But again, if the victim’s testimonies raise serious
doubts and inconsistencies especially regarding the identity of the suspect as stated above, the Court
cannot affirm the conviction of the accused.
PEOPLE OF THE PHILIPPINES v. FLORANTE RELANES

G.R. No. 175831, 12 April 2011, EN BANC (Del Castillo, J.)
AAA cried while recounting her awful experience at the hands of her own father so that the court
had to order a brief recess for her to regain her composure. Such display of emotion is a clear indication
regarding the truth of the rape charges.
AAA, then 8 years old, is the daughter Florante Relanes (Relanes) and BBB. When BBB was
away vending vegetables, Relanes, having a bolo with him, would carry AAA to a bedroom inside their
house. Inside the bedroom, he would undress AAA, mount her, and insert his penis to AAA’s vagina
and then do a push and pull movement. After that, Relanes would threaten AAA with the bolo, saying
the he will kill AAA and her family if AAA would report the incident to anyone. The sexual abuse was
repeated many times, usually on a Thursday night, when BBB is away vending vegetables. AAA got
pregnant. Despite her pregnancy, Relanes continued to have sexual intercourse with AAA until
Relanes left for Manila.
When Relanes was gone, AAA finally told BBB about AAA’s sexual ordeals in the hands of her
father. Thus, Relanes was charged in two separate informations with the crime of rape. The trial court
convicted Relanes of the crimes charged under the two informations. On appeal, the Court of Appeals
affirmed Relanes’ conviction. Hence, this petition.
ISSUE:
Whether or not Relanes is guilty beyond reasonable doubt of the crime of rape.
RULING:
YES. The Court has thoroughly reviewed the records and found that indeed the prosecution
has sufficiently and convincingly proved that Relanes had carnal knowledge of AAA through force
and intimidation sometime in August 2002 and on January 9, 2003. Records bear out the convincing
manner in which AAA testified and did so with candor and consistency in recounting the material
points of the criminal incidents. She vividly recounted the sexual ordeal that she suffered sometime
in August 2002 at the hands of her father.
AAA cried while recounting her awful experience at the hands of her own father so that the
court had to order a brief recess for her to regain her composure. Such display of emotion is a clear
indication regarding the truth of the rape charges.
Relanes’ defense of denial and alibi should be dismissed outright in light of his positive
identification by the victim AAA. It is an established jurisprudential rule that denial and alibi, being
negative self-serving defenses, cannot prevail over the affirmative allegations of the victim and her
categorical and positive identification of Relanes as her assailant.
PEOPLE OF THE PHILIPPINES v. VICENTE PUBLICO

G.R. No. 183569, 13 April 2011, THIRD DIVISION (Sereno, J.)
The act of poking a knife at a woman is sufficient to render her powerless, leaving her with the
impossible choice of either allowing the accused to use her to satisfy his lust or to resist the desires of
the accused at the risk of her own life.
AAA and BBB are daughters of Vicente Publico (Publico). Sometime in June 1996, at around
three o’clock in the afternoon, while her mother and her brothers were out working and her younger
sister AAA was in school, BBB was sent by her father to buy kerosene to be used for his massage.
When she arrived at their house, Publico suddenly dragged her inside the room. He then poked a
sharp weapon at BBB and took her shorts off. After removing her shorts, he removed his briefs and
had sexual intercourse with her. After that fateful day in June 1996, Publico raped her several more
times for a period of two years or until she reached the age of eighteen. Whenever BBB tried to resist
her father’s attempts to have sexual intercourse with her, he would maul her until she was left with
no other choice but to yield to his desires. Eventually, Publico got BBB pregnant. She gave birth to
their child in June 1997.
On the evening of 21 February 1999 at their house, Publico asked AAA to come to him. AAA
approached her father and saw that he was holding a bolo. Publico ordered AAA to take off her panty.
She refused to take it off, so the former removed it himself. He then mounted AAA and attempted to
insert his penis into her vagina. The physiological state of AAA made full penetration impossible—
she was only a twelve-year-old virgin and her vagina was still too tight; the mere attempt to have
sexual intercourse with her caused her immense pain. Frustrated and enraged, Publico started
hurling tirades at her. Soon thereafter one of their neighbors knocked on their door. Publico opened
the door and left the house with AAA.
AAA told her older brother of Publico’s attempt to rape her. Thus, Publico was charged with
attempted rape. Thereafter, the older brother informed BBB of the incident with AAA. Hence, BBB
filed a separate complaint charging Publico with rape. The two cases were consolidated. By way of
defense, Publico denied the accusations and presented alibis. The trial court rendered a joint
decision, convicting Publico of attempted rape and rape. On appeal, the appellate court affirmed
Publico’s conviction. Hence, this petition.
ISSUE:
1. Whether or not Publico is guilty of attempted rape and rape.

2. Whether or not minority could be considered as a qualifying circumstance in this case.
RULING:
1. YES. After a thorough examination of the testimonies of BBB and AAA, it is clear to the Court
that the testimonies are spontaneous, clear, candid, and free from serious contradictions. The Court
maintains that testimonies of rape victims who are young and of tender age are credible. The
revelation of an innocent child whose chastity was abused deserves full credence. Furthermore, the
Court has held that a rape victim’s testimony is entitled to greater weight when she accuses a close
relative of having raped her. Publico contends that the testimony of BBB that she did not resist
because she was afraid that her father might stab her with the sharp weapon with which he poked
her should not be given weight, since it is “too presumptuous or imaginary considering there is yet
no testimony on her part that accused had attempted to stab her.” The Court cannot fathom why it
should require rape victims to establish that the accused attempted to stab them before the accused
can be convicted of the crime of rape. The poking with a sharp weapon to coerce BBB into submission
already establishes force and/or intimidation as contemplated by the Revised Penal Code. The act of
poking a knife at a woman is sufficient to render her powerless, leaving her with the impossible
choice of either allowing the accused to use her to satisfy his lust or to resist the desires of the accused
at the risk of her own life. It has been held that the mere display of a knife is sufficient to bring a
woman to submission.
Lastly, Publico relies heavily on Dr. Regino Mercado’s Medical Certificate, which states that
no hymenal laceration was found on AAA. According to Publico, the negative findings in the Medical
Certificate only show or indicate that the accused did not attempt to insert his penis into the vagina
of AAA. This argument of Publico is wrong and does not exculpate him from the charge of attempted
rape. Had there been a hymenal laceration, it would no longer be merely an attempted rape. It would
already be indicative that the crime of rape was indeed consummated.
2. NO. The Court has held that for minority to be considered as a qualifying circumstance in
the crime of rape, minority must not only be alleged in the Information, but must also be established
with moral certainty. The Court noted that while the Information alleged that BBB was only 16 years
old at the time she was first raped, no other evidence, documentary or otherwise—except for BBB’s
testimony—was presented to prove her minority at the time of the commission of the offense. The
same is true for AAA. Thus, the prosecution failed to discharge the burden of proving the minority of
AAA and BBB.
PEOPLE OF THE PHILIPPINES v. ERNESTO MERCADO

G.R. No. 189847, 30 May 2011, THIRD DIVISION, (Brion, J.)
The date of the commission of the rape is not an essential element of the crime of rape, for the
gravamen of the offense is carnal knowledge of a woman.
AAA is the fifth child of Ernesto Mercado (Mercado) and BBB. Sometime in 2000, BBB (AAA’s
mother) and CCC (AAA’s sister), went to Ambalite, Pugo, La Union. AAA, her two other siblings, and
the Mercado, were left in their house at Rosario, La Union. At around 8:00 a.m., and while AAA was
doing her school assignment, Mercado entered her room and sat in a corner. Afterwards, Mercado
sat beside AAA, kissed her on the right cheek, and removed her shorts and panty. Mercado threatened
to kill AAA if she shouted. Mercado then removed his shorts and briefs, went on top of AAA, and
inserted his penis into her vagina.
AAA also recalled that at around 2:00 p.m. of July 26, 2000, while BBB was at the market and
AAA’s siblings were at their aunt’s house, Mercado again sexually abused her. Sometime in 2003, AAA
and Mercado were cleaning a banana grove when the latter told her to take a rest. AAA did as
instructed, and while she was resting, Mercado embraced her and kissed her on the cheek and lips.
Mercado removed AAA’s clothes and panty, and laid her on the grass. Mercado took off his own shorts
and briefs, went on top of AAA, and inserted his penis into her vagina.
According to AAA, Mercado sexually abused her five (5) times from 2000 to 2003. The
prosecution charged Mercado with three (3) counts of rape before the RTC. Mercado denied the
charges against him, and claimed that his brother was the one who raped AAA. The Regional Trial
Court (RTC) found Mercado guilty beyond reasonable doubt of two (2) counts of rape, and sentenced
him to suffer the penalty of reclusion perpetua for each count. The Court of Appeals (CA) affirmed
the RTC decision.
ISSUE:
Whether or not Mercado is guilty beyond reasonable doubt of two (2) counts of rape
RULING:
YES. The Court finds AAA’s testimony regarding the rape that happened on July 26, 2000, to
be deficient; it lacked specific details on how the rape was committed. AAA’s statement that she had
been fucked for the second time by the appellant in the same house, without nothing more, is
insufficient to establish carnal knowledge with moral certainty. Every charge of rape is a separate
and distinct crime and each must be proved beyond reasonable doubt. The lower courts were thus
correct in convicting Mercado of only two (2) counts of rape. Further, Mercado’s argument that AAA’s
testimony is unreliable due to the inconsistencies in the dates when the rapes were committed is
unmeritorious. At any rate, the date of the commission of the rape is not an essential element of the
crime of rape, for the gravamen of the offense is carnal knowledge of a woman. The discrepancies in
the actual dates the rapes took place are not serious errors warranting a reversal of the appellants
conviction. What is decisive in a rape charge is the victim’s positive identification of the accused as
the malefactor.
PEOPLE OF THE PHILIPPINES v. ROSAURO ASETRE Y DURAN

G.R. No. 175834, 8 June 2011, FIRST DIVISION, (Del Castillo, J.)
Under Article 266-B of the Revised Penal Code, the penalty for rape committed under the
circumstances is reclusion perpetua.
The prosecution established that Rosauro Asetre (Asetre) was the common-law husband of
"DDD", who is the aunt of "AAA". According to "AAA", she started living with "DDD" and Asetre when
she was still small. "AAA" narrated that in March 2001, particularly during her summer vacation at
"BBB", Asetre raped her four times. The first rape happened during the first week of March 2001 at
around noontime. Asetre took off her clothes then inserted his penis into her vagina. "AAA" felt pain
in her private parts. "AAA" struggled against the advances of appellant but to no avail. Appellant even
threatened "AAA" that she and "DDD" would be killed if she would report the incident. Thereafter,
Asetre sexually molested "AAA" three more times. The second rape transpired during the second
week of March 2001; while the third rape was committed shortly thereafter. The fourth and last rape
incident happened on March 23, 2001.
Another witness for the prosecution was Dr. Jeffrey M. Barcena (Dr. Barcena) who testified
that on April 25, 2001, he conducted a medical examination on "AAA". He testified that "AAA" had
multiple old hymenal lacerations which could have been caused by anything which penetrated her
vagina. He also noted a recent abrasion on the labia minora. The prosecution charged Asetre with
four (4) counts of rape before the Regional Trial Court (RTC). RTC found Asetre guilty as charged.
Upon appeal, the Court of Appeals affirmed RTC Decision.
ISSUE:
Whether or not Asetre is guilty beyond reasonable doubt of four (4) counts of rape
RULING:
NO. The Court finds that the evidence presented by the prosecution showed that Asetre is
guilty of only one count of rape, and not four counts. The Informations charged Asetre with having
raped "AAA" on the first week, second week, and third week, of March 2001, and on March 23, 2001.
However, as argued by the defense, the testimony of "AAA" with regard to the first three incidents
particularly on the dates when and the places where the offenses were supposedly committed
contains disturbing discrepancies.
The Court thus could not agree with the findings of the trial court and the CA that the
inconsistencies in the testimony of "AAA" regarding the first three rape incidents are inconsequential.
These inconsistencies create a reasonable doubt in our mind as to whether Asetre did in fact rape
"AAA" during those occasions. Consequently, we are constrained to acquit Asetre of the charges of
rape allegedly committed during the first week, second week, and third week, of March 2001 based
on reasonable doubt.
In contrast, "AAA’s" testimony as regards the March 23, 2001 incident was candid and
consistent. She never wavered in her narration that through threats and intimidation, Asetre had
carnal knowledge of her against her will. As regards the March 23, 2001 incident, the prosecution
established that Asetre had carnal knowledge of "AAA" through force, threat or intimidation. "AAA’s"
confusion relative to the first three incidents does not warrant his acquittal as regards the March 23,
2001 incident; neither does it detract us from the fact that she was indeed raped by Asetre on March
23, 2001.
PEOPLE OF THE PHILIPPINES v. ITO PINIC

G.R. No. 186395, 8 June 2011, FIRST DIVISION, (Perez, J.)
A man commits rape by having carnal knowledge of a child under twelve (12) years of age even
in the absence of any of the following circumstances: (a) through force, threat or intimidation; (b) when
the offended party is deprived of reason or otherwise unconscious; or (c) by means of fraudulent
machination or grave abuse of authority.
In an Information it was alleged, “That on or about the month of April 2001, Ito Pinic (Pinic),
did then and there wilfully, unlawfully, and feloniously had carnal knowledge of one [AAA], a seven
(7) year old girl, by means of force and against the latters will and consent.” It was only on 27 January
2003 that Pinic was apprehended and committed to the Bureau of Jail Management and Penology by
virtue of an Alias Warrant of Arrest issued by the trial court.
On trial, AAA testified that sometime in April 2001, she, together with playmates JJJ and a
certain MJR, played bahay-bahayan outside the house of Victorio Pinic a.k.a. Balulang. On that same
day, her neighbor Pinic, who was armed with a bolo/knife, summoned her to the house of Balulang.
Inside the house, he threatened to cut her ears with his bolo. He undressed her and removed her
panty. Thereafter, he took off his own pants and inserted his penis into her vagina. She felt pain. He
withdrew his penis after about ten (10) seconds but inserted it again after ten (10) seconds. After
five (5) seconds, he withdrew it again but inserted it once more after five (5) seconds. He also inserted
his finger and licked her vagina. After consummating the act, Pinic sent her home and warned her not
to tell anyone of the incident.
Sometime in the same month of April 2001, AAA complained to her father FFF that her anus
was painful. When her mother MMM examined her, she confided that she was raped by Pinic. The
prosecution filed a case against Pinic before the Regional Trial Court (RTC). RTC convicted Pinic of
the crime of rape. Upon appeal, the Court of Appeals affirmed RTC Decision.
ISSUE:
Whether or not Pinic is guilty beyond reasonable doubt of the crime of rape
RULING:
YES. Owing to the manner of the commission of rape, the sole testimony of the victim may be
sufficient to convict the accused so long as the court finds the testimony credible, natural, convincing
and consistent with human nature and the normal course of things. More so, when the testimony is
supported by the medico-legal findings of the examining physician. Invoking the three (3) well-
entrenched principles that guide the court in the determination of the guilt of an accused, Pinic
maintains that the sole testimony of AAA should not be made the basis for his conviction. The Court
is not convinced. The testimonies of the private complainant are scrutinized by this court with
extreme caution. These testimonies from direct, cross, re-direct and re-cross examination were given
on different dates. It can be clearly seen that they are consistent save for the minor inconsistencies.
Settled is the rule, however, that when the testimony of the victim is supported by the physicians
finding of penetration, there is sufficient foundation to conclude that the requisites of carnal
knowledge existed. Moreover, AAA positively identified Pinic as her assailant. The bare denial of the
Pinic cannot prevail over the positive identification and credible testimony of AAA as we have
consistently ruled that a categorical testimony generally prevails over a bare denial.
PEOPLE OF THE PHILIPPINES v. CONRADO LAOG y RAMIN

Article 266-B of the Revised Penal Code, as amended, provides only a single penalty for the
composite acts of rape and the killing committed by reason or on the occasion of the rape. Rape with
homicide was consummated, and it is immaterial that the person killed is someone other than the
woman victim of the rape.
AAA and Jennifer Patawaran-Rosal, were walking along the rice paddies when they were
stopped by Conrado Laog (Laog), who was then holding an ice pick and lead pipe. Laog led them to a
grassy area where he struck Rosal in the head with the lead pipe. This caused Rosal to fall down after
which Laog stabbed her multiple times. Laog then turned to AAA whom he also hit on the head with
the lead pipe and subsequently raped the latter. After raping AAA, Laog covered her with grass and
left her to die. Fortunately, AAA was able to crawl towards her uncle’s farm. AAA was brought to the
hospital where she stayed for three weeks and during which she learned that Rosal had died.
Conrado Laog was charged with murder and rape but he pleaded not guilty. Both the Regional
Trial Court and the Court of Appeals found Laog guilty of the crimes charged.
ISSUES:
1. Whether or not AAA’s testimony is sufficient to convict Laog.

2. Whether or not the offenses Laog were convicted of by the lower courts were proper.
RULING:
1. YES. Here, both the trial and appellate courts gave credence and full probative weight to
the testimony of AAA, the lone eyewitness to Jennifer’s killing and was herself brutally attacked by
Laog who also raped her. Indeed, records bear out that AAA became so tense and nervous when she
took the witness stand for the first time that the trial court had to cut short her initial direct
examination. However, during the next hearing she was able to narrate her harrowing ordeal in a
clear and straightforward manner, describing in detail how Laog waylaid them and mercilessly hit
and attacked her and Jennifer with a lead pipe and ice pick before raping her.
On the other hand, Laog merely interposed the defense of denial and alibi. He claimed that at
the time of the incident, he was at his house with his children and nephew cooking dinner. His
defense, however, cannot prevail over the straightforward and credible testimony of AAA who
positively identified him as the perpetrator of the murder and rape. With AAA’s familiarity and
proximity with the appellant during the commission of the crime, her identification of Laog could not
be doubted or mistaken. In fact, AAA, upon encountering appellant, did not run away as she never
thought her own uncle would harm her and her friend. Moreover, the most natural reaction of victims
of violence is to strive to see the appearance of the perpetrators of the crime and observe the manner
in which the crime is being committed. There is no evidence to show any improper motive on the
part of AAA to testify falsely against Laog or to falsely implicate him in the commission of a crime.
2. NO. Laog should not have been convicted of the separate crimes of murder and rape. The
facts alleged and proven clearly show that the crime committed by Laog is rape with homicide, a
special complex crime provided under Article 266-B, paragraph 5 of the Revised Penal Code, as
amended by R.A. No. 8353. Composite crimes are neither of the same legal basis as nor subject to the rules
on complex crimes in Article 48 of the Revised Penal Code, since they do not consist of a single act giving
rise to two or more grave or less grave felonies [compound crimes] nor do they involve an offense being
a necessary means to commit another [complex crime proper]. However, just like the regular complex
crimes only a single penalty is imposed for each of such composite crimes although composed of two
or more offenses.
Article 266-B of the Revised Penal Code, as amended, provides only a single penalty for the
composite acts of rape and the killing committed by reason or on the occasion of the rape. Considering
that the prosecution in this case was able to prove both the rape of AAA and the killing of Jennifer
both perpetrated by Laog, he is liable for rape with homicide under the above provision. There is no
doubt that Laog killed Jennifer to prevent her from aiding AAA or calling for help once she is able to
run away, and also to silence her completely so she may not witness the rape of AAA, the original
intent of appellant. His carnal desire having been satiated, Laog purposely covered AAAs body with
grass, as he did earlier with Jennifers body, so that it may not be easily noticed or seen by passersby.
Laog indeed thought that the savage blows he had inflicted on AAA were enough to cause her death
as with Jennifer.
PEOPLE OF THE PHILIPPINES v. ANIECTO BULAGAO

G.R. No. 184757, 5 October 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Courts look with disfavor upon retractions, because they can easily be obtained from witnesses
through intimidation or for monetary considerations. Hence, a retraction does not necessarily negate
an earlier declaration. The recantation, even of a lone eyewitness, does not necessarily render the
prosecution’s evidence inconclusive.
AAA was the victim of rape perpetrated by her adoptive brother, Aniceto Bulagao (Bulagao).
AAA, who was then 14 years old, was adopted by BBB and CCC at a very young age. The two incidents
of rape committed by Bulagao upon AAA occurred in the houses of her brother DDD and the second,
in the house of her sister. Two Informations were filed against Bulagao for the crime of rape. When
it was time for the defense to present their evidence, it presented as its witness AAA, who recanted
her testimony for the prosecution. She testified that the sexual encounters between her and Bulagao
were consensual; and that she fabricated the charge of rape against Bulagao because she was
supposedly angry with him. AAA stated that she was recanting her previous testimony because she
purportedly was no longer angry with Bulagao.
On cross-examination, AAA clarified that she fabricated the charge of rape because she was
angry with Bulagao for making her do laundry work for him. But when asked if she consented and
voluntarily submitted herself to Bulagao, she answered in the negative. AAA has already been
released from the custody of the DSWD and was alone by herself for some time, but she now lives
with the family of Bulagao. On redirect examination, AAA testified that accused-appellant did not
force himself upon her. Despite AAA’s retraction of her testimony against Bulagao, the Regional Trial
Court (RTC) convicted Bulagao of the two counts of rape. According to the RTC, AAA was initially in
the custody of DSWD when she testified against Bulagao but at the time she retracted her testimony,
she was already living again with the family of Bulagao. Clearly, AAA was totally dependent on
Bulagao’s family since she was an orphan and retracted her testimony to keep her relationship with
Bulagao’s family. The Court of Appeals later affirmed the same.
ISSUE:
Whether or not Bulagao should be convicted of raping AAA considering that the latter
retracted her initial testimony against the former.
RULING:
YES. Courts look with disfavor upon retractions, because they can easily be obtained from
witnesses through intimidation or for monetary considerations. Hence, a retraction does not
necessarily negate an earlier declaration. Moreover, it would be a dangerous rule to reject the
testimony taken before a court of justice, simply because the witness who has given it later on
changes his mind for one reason or another. The recantation, even of a lone eyewitness, does not
necessarily render the prosecution’s evidence inconclusive. In the case at bar, the determination by
the trial court of the credibility of AAA’s accusation and recantation is facilitated by the fact that her
recantation was made in open court, by testifying for the defense. Unlike in cases where recantations
were made in affidavits, the trial court in this case had the opportunity to see the demeanor of AAA
not only when she narrated the sordid details of the alleged rape by her adoptive brother, but also
when she claimed that she made up her previous rape charges out of anger. As such, it is difficult to
overlook the fact that the trial court convicted Bulagao even after examining the young witness as
she made a complete turnaround and admitted to perjury.
However, even if we disregard the elusive and incommunicable evidence of the witnesses'
deportment on the stand while testifying, it is clear which of the narrations of AAA was sincere and
which was concocted. AAA’s testimony for the prosecution, which was taken when she was in the
custody of the DSWD, was clear, candid, and bereft of material discrepancies. All Bulagao can harp on
in his appellants brief was AAA’s failure to recall the length of the knife used in the assaults, a minor
and insignificant detail not material to the elements of the crime of rape. She remained steadfast on
cross-examination even as defense counsel tried to Bulagao’s father when she was seven years
old. This is in stark contrast to her testimony for the defense, where AAA, now living with Bulagao‘s
family, claimed that she fabricated a revolting tale of rape simply because Bulagao made her do
laundry. AAA’s recantation even contradicts the testimony of Bulagao himself. While AAA claims in
her retraction that she had consensual sex with her brother, Bulagao testified that they merely kissed
and that AAA’s purported motive for the rape charges was monetary.
As furthermore observed by both the trial court and the Court of Appeals, the cross-examination of
AAA as a defense witness revealed that it was taken at a time when AAA had nowhere to go and was
forced to stay with the family of Bulagao and upon a reliance on the family’s implied commitment to
send Bulagao to Mindanao.
PEOPLE OF THE PHILIPPINES v. BERNABE PANGILINAN y CRISOSTOMO
For in rape cases, the date of the commission is not an essential element of the offense; what is
material is its occurrence.
In an Information filed, Bernabe Pangilinan (Pangilinan) was charged of criminally

committing acts of lasciviousness upon the person of AAA, a minor subjected to sexual abuse. While
AAA was two years old, she lived with her aunt BBB. At around 10 p.m. of July 27, 2001, while her
aunt was out working, she was asked to cook adobo by Pangilinan which she did. Suddenly,
Pangilinan approached her and pointed a samurai at her. Pangilinan then kissed her neck and mashed
her breast. It was not the first time that Pangilinan did that to her.
On the trial of the case, AAA testified that there are three incidents she remembers. First was
when Pangilinan kissed her and touched her private parts. The second time was when Pangilinan
pointed a samurai at her, took her to a room and removed her clothes and kissed her on her lips and
touched her private organ. He then laid on top of her and tried to insert his penis to her private organ.
His organ touched her vagina; that she felt pain in her vagina but there was no blood. And the third
time was when Pangilinan kissed her and mashed her breast. She did not tell her aunt because he
threatened to kill both of them.
Pangilinan 's defense was the testimony of her wife, BBB, that she was able to talk to AAA
which revealed to her it was her cousin CCC who molested her. And that the findings of the attending
physician that there was no hymenal laceration. The Regional Trial Court (RTC) found him guilty for
the crime of rape. The Court of Appeals (CA) affirmed the decision of the RTC.
ISSUE:
Whether or not the accused is guilty beyond reasonable doubt for the crime of rape.
RULING:
YES. The Supreme Court finds that AAA remained steadfast in her assertion that appellant
raped her through force and intimidation with the use of a samurai. She testified that his penis was
inserted into her vagina and that she felt pain because of the penetration. Rape is committed even
with the slightest penetration of the woman's sex organ. Eventhough it is only the testimony of AAA,
the court finds her testimony able to meet the test of credibility. It is also note that no woman, much
less a child of such tender age, would willingly submit herself to the rigors, the humiliation and the
stigma attendant upon the prosecution of rape, if she were not motivated by an earnest desire to put
the culprit behind bars.
The defense of the accused that there is no hymenal laceration is untenable as Proof of
hymenal laceration is not an element of rape. While it appears from AAA's testimony that she was
not raped precisely on July 27, 2001 as what appellant did was kiss her lips and mash her breast on
that day, however, her entire testimony in the witness stand positively shows that appellant with the
use of force and intimidation had carnal knowledge of her at some other time. For in rape cases, the
date of the commission is not an essential element of the offense; what is material is its occurrence.
Notably, the information alleges that the crime of rape was committed "on or about July 27, 2001,"
thus the prosecution may prove that rape was committed on or about July 27, 2001, i.e., few months
or years before, and not exactly on July 27, 2001.
PEOPLE OF THE PHILIPPINES v. JOJO DELA PAZ y TABOCAN

G.R. No. 182412, 28 November 2011, SECOND DIVISION (Brion, J.)
Sexual intercourse with a mentally retarded woman incapable of giving rational consent
constitutes rape.
Jojo Dela Paz (Dela Paz) was charged with the rape of AAA, a 30-year old woman who suffers
from mental retardation. Dela Paz and AAA were neighbors, whose houses were located in the same
residential compound, when the rape occurred. Dela Paz, whenever he would take a bath, would call
AAA to join him in the common comfort room of the compound. Once inside, Dela Paz would kiss and
embrace AAA, undress her, make her lie down on the floor, proceed to lie on top of her, insert his
organ into hers, and make pumping motions with his buttocks. After some time, AAA’s mother
noticed AAA’s swelling abdomen and began to suspect that AAA was pregnant. AAA was brought to
a doctor and it was confirmed that she was pregnant. It was then that she told her mother about
what Dela Paz did to her in the communal comfort room. They reported the matter to the police and
Dela Paz was arrested. The Regional Trial Court (RTC) convicted him as charged, which the Court of
ISSUE:
Whether or not the Dela Paz is guilty of the crime of rape.
RULING:
YES. The Court’s review confirms that the CA and the RTC correctly appreciated the evidence
in arriving at their findings of fact. The Court found no such grave abuse of discretion and in fact
found, after due consideration of the facts on record, that indeed AAA is intellectually disabled and
yet was a credible witness. Her positive identification of Dela Paz as her comfort room lover and as
the father of her child established his sexual relationship with her. By law and jurisprudence, sexual
intercourse with a mentally retarded woman incapable of giving rational consent constitutes rape.
The RTC and the CA correctly rejected the defenses of denial and alibi as these are the weakest
of defenses and are easy to concoct and fabricate. In this case, Dela Paz’s alibi is not persuasive for
his failure to demonstrate the physical impossibility of his presence at the crime scene; for instance,
he himself admitted that the crime scene was only about one kilometer away from his place of work.
Likewise, his denial is unpersuasive in light of AAA’s positive and credible testimony on the sexual
intercourse he instigated and essentially forced upon her at the communal comfort room.
PEOPLE OF THE PHILIPPINES v. HENRY ARPON y JUNTILLA

Each and every charge of rape is a separate and distinct crime that the law requires to be
proven beyond reasonable doubt.
Henry Arpon (Arpon) was charged with eight (8) counts of rape in separate Informations.
AAA narrated that when she was only eight years old, Arpon, her uncle, raped her inside their house.
She could not remember, though, the exact month and date of the incident. AAA also testified that
Arpon raped her again in July 1999 for five times on different nights. Arpon was then drinking alcohol
with BBB, the stepfather of AAA, in the house of AAA’s neighbor. He came to AAA’s house, took off
her panty and went on top of her. He made her hold his penis then he left. When asked again how
Arpon raped her for five nights in July of the said year, AAA narrated that he pulled down her panty,
went on top of her and pumped. She felt pain as he put his penis into her vagina. AAA further related
that Arpon raped her again twice in August 1999 at nighttime. He kissed her and then he took off his
shirt, went on top of her and pumped. AAA said that she did not tell anybody about the rapes because
Arpon threatened to kill her mother if she did.
She only filed a complaint when he proceeded to also rape her younger sister, DDD. Both the
Regional Trial Court (RTC) and the Court of Appeals (CA) convicted Arpon of one (1) count of
statutory rape and seven (7) counts of qualified rape.
ISSUE:
Whether or not Arpon is guilty of all counts of rape charged against him.
RULING:
NO. Presently, Article 266-A of the Revised Penal Code defines the crime of rape by sexual
intercourse. In particular, Article 266-A(1)(d) spells out the definition of the crime of statutory rape,
the elements of which are: (1) that the offender had carnal knowledge of a woman; and (2) that such
a woman is under twelve (12) years of age or is demented. The said provision came into existence
by virtue of Republic Act No. 8353, or the Anti-Rape Law of 1997, which took effect on October 22,
1997. Prior to this date, the crime of rape was penalized under Article 335 of the Revised Penal Code.
Manifestly, the elements of statutory rape in the said provisions of law are essentially the same. Thus,
whether the first incident of rape charged in this case did occur in 1995, i.e., before the amendment
of Article 335 of the Revised Penal Code, or in 1998, after the effectivity of the Anti-Rape Law of 1997,
the prosecution has the burden to establish the fact of carnal knowledge and the age of AAA at the
time of the commission of the rape.
As regards the first incident of rape, the RTC credited with veracity the substance of AAA’s
testimony. In the instant case, the Court has thoroughly scrutinized the testimony of AAA and the
Court found no cogent reason to disturb the finding of the RTC that Arpon indeed committed the first
incident of rape charged. AAA positively identified Arpon as the perpetrator of the dastardly crimes.
With tears in her eyes, she clearly and straightforwardly narrated the said incident of rape. Anent the
five incidents of rape that were alleged to have been committed in July 1999, the Court disagrees with
the ruling of the trial court that all five counts were proven with moral certainty. From her testimony,
AAA merely described a single incident of rape. She made no reference whatsoever to the other four
instances of rape that were likewise supposedly committed in the month of July 1999. The same is
also true for the two (2) counts of rape allegedly committed in August 1999. AAA narrated only one
incident of rape.
It is settled that each and every charge of rape is a separate and distinct crime that the law
requires to be proven beyond reasonable doubt. The prosecution’s evidence must pass the exacting
test of moral certainty that the law demands to satisfy the burden of overcoming the appellant’s
presumption of innocence. Thus, including the first incident of rape, the testimony of AAA was only
able to establish three instances when Arpon had carnal knowledge of her.
PEOPLE OF THE PHILIPPINES v. LUISITO LALICAN y ARCE

Violent crimes usually fill their victims with dread and terrible fear for their lives. Rarely would
they mentally record details of the startling events as they happen with the expectation that they would
get some subpoena in some future time to testify in some future court.
SHINE was renting a room in Luisito Lalican (Lalican)’s two-storey house in Tayuman for the
past seven months. SHINE stayed at the ground floor while Lalican and his family were at the second
floor. At around 9:00 to 10:00 a.m. on July 10, 2005, she heard Lalican knock on her door asking for
help because he allegedly had a fight with his wife. SHINE declined to intervene, and when she started
to close the door, Lalican resisted and forced it open. He closed the door and pointed a knife at
SHINE’s neck which shocked her and stopped her from yelling for help. It was then that Lalican
grabbed and undressed her, pushed her on the floor and had his way with her. After the incident,
SHINE proceeded to the bathroom, at first stopped by Lalican, and later left the house and reported
the incident to the police. When the policemen came to Lalican’s house, SHINE declined to enter.
On the trial of the case, Dr. Soliman, a medico-legal officer testified that shine had (1) no
extragenital physical injuries on her body; (2) that the hymen was reduced to carunculae
myrtiformis; and (3) that succeeding sexual intercourse may not produce any new hymenal injury.
Lalican then denied raping SHINE. He said that he was attending the wake of a friend’s mother the
previous day, and returned to his house around 6:00 a.m. the next day. He recounted seeing SHINE’s
boyfriend, Francis, walking out of her room and leaving the house after taking a bath and then he
went to sleep. He was only woken up at around 10:00 a.m. because the policemen were looking for
him. The Regional Trial Court (RTC) found Lalican guilty of raping SHINE and the said decision was
affirmed by the Court of Appeals (CA).
Lalican was assailing SHINE’s inconsistent statements particularly how one version states
that SHINE was pushed on the floor and another version of her statement said Lalican made her lie
down. Lalican also assails other inconsistencies saying that SHINE’s statements could not be believed.
ISSUE:
Whether or not the Lalican is guilty beyond reasonable doubt of raping SHINE.
RULING:
NO. Violent crimes usually fill their victims with dread and terrible fear for their lives. Rarely
would they mentally record details of the startling events as they happen with the expectation that
they would get some subpoena in some future time to testify in some future court. What is important
is that the core of SHINE’s testimony that Lalican barged into her room, threatened to butcher her
with a knife if she resisted, and forced herself in to her, remains unchanged. The manner of how it
was done, or inconsistencies over very small details is immaterial in determining whether or not
there is rape for the victim cannot humanly grasp all the details happening during the startling event.
Thus, perfect testimonies repeated with precision and consistency often indicate rehearsals a
coaching.
Lalican also failed to show competent evidence showing bad faith or some sinister motive in
the part of SHINE to accuse him of rape. Moreover, it was quite unlikely that SHINE would
spontaneously walk to the police station to voice her outrage and convince the policemen if she had
no genuine cause to gripe about.
PEOPLE OF THE PHILIPPINES v. JIMMY ALVERIO

G.R. No. 194259, 16 MARCH 2011, FIRST DIVISION (Velasco, J.)
A medical certificate is not even necessary to prove the crime of rape. The gravamen of rape is
carnal knowledge of a woman through force and intimidation.
AAA went to a dance party with her friends at the barangay hall near her grandmother’s
house. At about 2:00 a.m., she noticed that her friends were gone so she decided to go home. While
she was walking, Alverio blocked her way and dragged her towards the back of the barangay hall.
Alverio undressed her, kissed her, and inserted his penis into her vagina, all the while poking a knife
at AAA’s side. AAA no longer resisted because Alverio said he would retaliate if she did. When Alverio
was done, he threatened AAA that he would kill her if she told anyone, and then left. Too stunned to
move, AAA sat on the road beside the barangay hall until morning, where her uncle found her. The
uncle took her home, and then she told her parents what happened. Alverio and AAA are cousins.
Alverio’s defense was that he was at the dance but he never saw AAA, and that he went home
at 12:00 midnight. The Regional Trial Court (RTC) convicted Alverio of rape. The Court of Appeals
(CA) affirmed the decision. However, Alverio claims that the prosecution failed to prove his guilt
beyond reasonable doubt, and that the court erred in convicting him based on the uncorroborated
testimony of a single witness.
ISSUE:
Whether or not Alverio was guilty of rape based on the single testimony of the rape victim.
RULING:
YES. In cases involving the prosecution for forcible rape, corroboration of the victim’s
testimony is not a necessary condition to a conviction for rape where the victim’s testimony is
credible, or clear and convincing or sufficient to prove the elements of the offense beyond a
reasonable doubt. As such, appellate courts generally do not disturb the findings of the trial court
with regard to the assessment of the credibility of witnesses, the reason being that the trial court has
the unique opportunity to observe the witnesses first hand and note their demeanor, conduct and
attitude under grilling examination. More importantly, courts generally give full credence to the
testimony of a complainant for rape, especially one who is only a minor.
The exceptions to this rule are when the trial courts findings of facts and conclusions are not
supported by the evidence on record, or when certain facts of substance and value likely to change
the outcome of the case have been overlooked by the lower court, or when the assailed decision is
based on a misapprehension of facts. However, this Court finds none of these exceptions present in
the instant case.
In addition, Alverio submits that although the medical certificate was presented as evidence,
its contents were never testified to by the signatory himself and, as such, cannot be considered as
corroborative of the claim of the victim that she was raped. Such argument, however, cannot prosper.
Medical evidence is dispensable and merely corroborative in proving the crime of rape. Besides, a
medical certificate is not even necessary to prove the crime of rape. The gravamen of rape is carnal
knowledge of a woman through force and intimidation. The elements needed to prove the crime of
rape under paragraph 1(a) of Article 266-A of the Revised Penal Code are: (1) the offender is a man;
(2) the offender had carnal knowledge of a woman; and (3) the act is accomplished by using force or
intimidation. All these elements were sufficiently proved by the prosecution. The testimony of AAA
overwhelmingly proves that Alverio raped her with the use of force and intimidation.
PEOPLE OF THE PHILIPPINES v. HERMIE M. JACINTO

G.R. No. 194259, 16 MARCH 2011, FIRST DIVISION (Velasco, J.)
When the offender is a minor under 18 years, the penalty next lower than that prescribed by law
shall be imposed, but always in the proper period. However, for purposes of determining the proper
penalty because of the privileged mitigating circumstance of minority, the penalty of death is still the
penalty to be reckoned with.
FFF, the victim’s father, and Jacinto were neighbors. Jacinto was well known to FFF and his
family because they had been neighbors their whole life, and Jacinto had to pass FFF’s house to get
to the road. FFF had two daughters, the 5-year-old AAA and CCC. One day, FFF asked his daughters
to buy something from the store. CCC came back without AAA. At the store, a witness Julito Apiki saw
Jacinto place AAA on his lap. The three of them left the store at the same time, but Jacinto held AAA
by the hand as they went further down their area. Jacinto then made AAA lie down on the ground,
removed her panties, boxed her chest, and inserted his penis into her vagina. Afterwards, AAA went
home crying. FFF, her mother, and the neighbors saw AAA covered in mud, bleeding, and crying,
saying that Jacinto raped her. They went to the police station to report the incident and to the health
center for a medical examination, where several abrasions on the body and hymenal lacerations were
found on AAA.
Jacinto claimed that he was at a birthday party in his aunt’s house at the time AAA was raped.
He also pointed that it was Julito who was with AAA, not him. His relatives corroborated his
statement. The Regional Trial Court (RTC) convicted Jacinto of rape. Later on, the RTC granted the
defense’s motion to reopen trial, where new evidence showed that Jacinto was 17 years old when the
crime was committed. The RTC considered the privileged mitigating circumstance of minority and
lowered the sentence from death penalty to reclusion perpetua. The Court of Appeals (CA) affirmed
the decision but modified the penalty to six (6) years and one (1) day to twelve (12) years of prision
mayor, as minimum, to seventeen (17) and four (4) months of reclusion temporal, as maximum.
ISSUE:
1. Whether or not Jacinto was guilty of rape.

2. Whether or not Jacinto was entitled to the penalty of reclusion perpetua, instead of the
death penalty, for the privileged mitigating circumstance of his minority.
RULING:
1. YES. That the crime of rape has been committed is certain. The vivid narration of the acts
culminating in the insertion of Jacinto’s organ into the vagina of five-year-old AAA and the medical
findings of the physicians sufficiently proved such fact. The Court should not, however, overlook the
fact that a victim of rape could readily identify her assailant, especially when he is not a stranger to
her, considering that she could have a good look at him during the commission of the crime. AAA had
known Jacinto all her life. Moreover, Jacinto and AAA even walked together from the road near the
store to the situs criminus that it would be impossible for the child not to recognize the man who
held her hand and led her all the way to the rice field.
For alibi to prosper, it is necessary that the corroboration is credible, the same having been
offered preferably by disinterested witnesses. The defense failed thuswise. Its witnesses cannot
qualify as such, they being related or were one way or another linked to each other. Even assuming
for the sake of argument that we consider the corroborations on his whereabouts, still, the defense
of alibi cannot prosper. The Court reiterates, time and again, that the court must be convinced that it
would be physically impossible for the accused to have been at the locus criminis at the time of the
commission of the crime.
2. YES. Sec. 6 of Republic Act No. 9344 exempts a child above fifteen (15) years but below
eighteen (18) years of age from criminal liability, unless the child is found to have acted with
discernment, in which case, the appropriate proceedings in accordance with the Act shall be
observed. In the present case, we agree with the Court of Appeals that: (1) choosing an isolated and
dark place to perpetrate the crime, to prevent detection; and (2) boxing the victim xxx, to weaken her
defense are indicative of then seventeen (17) year-old Jacinto’s mental capacity to fully understand
the consequences of his unlawful action. Nonetheless, the corresponding imposable penalty should
be modified. The birth certificate of AAA shows that she was born on 3 December 1997. Considering
that she was only five (5) years old when Jacinto defiled her on 28 January 2003, the law prescribing
the death penalty when rape is committed against a child below seven (7) years old applies. The
following, however, calls for the reduction of the penalty: (1) the prohibition against the imposition
of the penalty of death in accordance with Republic Act No. 9346; and (2) the privileged mitigating
circumstance of minority of the Jacinto, which has the effect of reducing the penalty one degree lower
than that prescribed by law, pursuant to Article 68 of the Revised Penal Code.
PEOPLE OF THE PHILIPPINES v. CARLO DUMADAG Y ROMIO

The gravamen of the offense of rape is sexual intercourse with a woman against her will or
without her consent.
AAA, 16 years of age at the time she testified, declared that in an early morning, she was on
her way home after hearing the midnight mass at BBB, CCC, DDD. She was a little bit behind Thelma,
Carlos and Clarence, all surnamed Dumadag. All of a sudden, Carlo Dumadag (Dumadag) approached
her from behind and poked a knife on her threatening to stab her if she shouts. He pulled her towards
the house of Joel Boyet Ursulum (Ursulum). Once inside, she was forced to remove her pants and
panty because of fear. Dumadag also removed his pants and brief and pushed her on a bamboo bed.
Pointing the knife at the left portion of her abdomen, he ordered her to hold his penis against her
vagina. He succeeded in having carnal knowledge of her. After he was through, they stayed inside the
house until six o’ clock in the morning of that day. All this time, he continued to hold the knife.
Pleading that she be allowed to go home, he finally let her go after threatening to kill her if she reports
the incident to her parents. AAA decided not to disclose what transpired due to fear. Nevertheless,
AAAs uncle, EEE learned from Dumadag himself that the latter had sexual intercourse with her. Her
uncle relayed the information to her father who confronted her about the incident. After confirming
the same from AAA, they decided to report the matter to the police where she was investigated and
her sworn statement taken. In a physical examination conducted on AAA, it was indicated that there
was laceration on AAA’s hymen.
On the other hand, Dumadag does not deny having had sexual intercourse with AAA. Instead,
he claimed that it was voluntary and without the use of force since they were lovers. The Regional
Trial Court (RTC) convicted him of the crime of rape, and the same was affirmed by the Court of
Appeals (CA).
ISSUE:
Whether or not the rape was committed through force and intimidation.
RULING:
YES. The gravamen of the offense of rape is sexual intercourse with a woman against her will
or without her consent. Based on the records, AAA candidly and categorically recounted the manner
Dumadag threatened her and succeeded in having sexual intercourse with her against her will. The
Court is then convinced of the truth and sincerity in the account of AAA. It bears to stress that as a
rule, testimonies of child victims of rape are given full weight and credit for youth and immaturity
are badges of truth.
Neither is it improbable for Dumadag to employ such criminal design in the presence of his
own family especially when overcome by lust. It is a common judicial experience that rapists are not
deterred from committing their odious act by the presence of people nearby. Lust is no respecter of
time and place. As established, AAA was silenced by Dumadag’s threat of killing her with a knife. Thus,
the reason for AAA’s failure to shout or cry for help is because she was overcome by fear. It has been
held that minors, like AAA, could be easily intimidated and cowed into silence even by the mildest
threat against their lives.
Qualified Rape
PEOPLE OF THE PHILIPPINES v. NILO ROCABO

G.R. No. 193482, 2 March 2011, THIRD DIVISION, (Brion, J.)
Since the rape incidents happened on April 27 and May 1, 1999, the applicable laws are Article
266-A and Article 266-B of the Revised Penal Code, as amended.
Nilo Rocabo (Rocabo) was charged with three counts of incestuous rape committed against
his 11-year-old daughter AAA on April 27 and 29, 1999 and May 1, 1999. AAA, the complainant,
testified that in all three occasions, Rocabo asked her to go inside the room, removed her shorts and
underwear, and told her to lie down. Rocabo then undressed himself, kissed her, and inserted his
private organ into her vagina. The medical examination on AAA revealed an old healed hymenal
laceration. Rocabo denied all the charges stating that he was with Emie Dagami on April 27, 1999 and
that BBB, the mother, and their children were at home with him on April 29 and May 1.
The Regional Trial Court (RTC) acquitted Rocabo for the alleged rape committed on April 29,
1999, but found him guilty of 2 counts of incestuous rape committed on April 27 and May 1, 1999
and the same was affirmed by the Court of Appeals (CA) giving full credence to AAA’s testimony and
noting that was improbable for a child of tender years to concoct a tale of sexual molestation
committed by her own father just because she was persuaded to do so by her mother. Rocabo was
sentenced to reclusion perpetua for two counts of rape and ordered to pay AAA P75,000 as moral
damages and P25,000 as exemplary damages for each count.
ISSUE:
Whether or not the RTC and CA erred in imposing the proper penalty on Rocabo.
RULING:
YES. The Court affirmed the conviction of rape beyond reasonable doubt and reject Rocabo’s
denial. Not only is denial an inherently weak defense, it cannot also prevail over the positive
testimony of the offended party.
In the present case, the Informations charging the appellant with the crimes of rape clearly
alleged that the appellant had carnal knowledge of his daughter, AAA, who was only 11 years old
when the rapes were committed on April 27 and May 1, 1999. Hence, the applicable laws are Article
266-A and Article 266-B of the Revised Penal Code.
The prosecution's evidence clearly shows AAA's age and filiation by Rocabo; thus, the Court
finds Rocabo guilty of qualified rape punishable by reclusion perpetua for each count of qualified
rape, without eligibility for parole. However, the Court modified Rocabo’s civil liability to include civil
indemnity and to increase the exemplary damages awarded. Civil indemnity is automatically
awarded upon proof of the commission of the crime by the offender. According to jurisprudence, the
offended party is entitled to P75,000 as civil indemnity, P75,000 as moral damages, and P30,000 as
exemplary damages to deter other persons with perverse or aberrant sexual behavior from sexually
abusing their children.
PEOPLE OF THE PHILIPPINES v. EDGARDO OGARTE y OCOB

G.R. No. 182690, 30 May 2011, FIRST DIVISION, (Leonardo-De Castro, J.)
Rape is a serious transgression with severe consequences for both the accused and the
complainant.
In this case, on or about the 1st and 3rd day of November, 1996, Edgardo Ogarte y Ocob
(Ogarte) moved by lewd and unchaste desire and by means of force, violence and intimidation,
succeeded in having sexual intercourse with AAA, his 16-year-old daughter, against her will and
without her consent. According to AAA, the first instance of rape happened in their home. AAA
claimed that while she was sleeping beside her four younger sisters, Ogarte woke her up, held her
hands brought her to the kitchen wherein she was forced to lie down on the floor. Ogarte proceeded
to take off her pants and underwear and insert his penis into her vagina. AAA averred that she cried
in pain and pleaded with her father not to do it but Ogarte told her to be silent and threatened to kill
her if she told her mother, who was at that time in Zamboanga del Sur. AAA kept her silence even
when her mother arrived the following day. Subsequently, on November 3, 1996, AAA alleged that
she was again raped by Ogarte. This occurred when she reluctantly obeyed to help Ogarte gather
some firewood in the wooded area near their house. AAA narrated that Ogarte still carrying the bolo
he used to cut the wood, pulled her shoulders and told her not to make any noise. AAA recounted
how Ogarte then went on to remove her undergarments, and consummated his sexual desires. After
Ogarte was done, he again warned and threatened AAA against breaking her silence.
AAA, believing that she would again be violated by Ogarte again, she mustered the courage to
reveal to her mother the events that transpired on November 1 and 3, 1996. Upon learning about
this, Ogarte, in his anger, pulled AAA and was about to stab her when he was stopped by AAA’s mother
who arrived just in time. Thereafter, AAAs mother told her to keep quiet about what her father did
to her. AAA told her grandmother BBB her ordeal in the hands of her own father. AAA and BBB went
to the National Bureau of Investigation (NBI) in Dipolog City where they executed the sworn
affidavits that were used as bases for the charges against Ogarte. The Regional Trial Court (RTC)
found Ogarte guilty as charged in both criminal cases and imposed on him the supreme penalty of
death for each count of rape. On intermediate appellate review, the Court of Appeals affirmed RTC
Decision.
ISSUE:
Whether or not Ogarte is guilty beyond reasonable doubt of two (2) counts of qualified rape
RULING:
YES. Ogarte was convicted of two counts of rape by using force and intimidation, qualified by
the concurrent circumstances of AAAs minority and Ogartes relationship with AAA. In an effort to
escape the penalty of death, as imposed by Article 335 of the Revised Penal Code when the crime of
simple rape is qualified, Ogarte claims that the courts below erred in appreciating AAAs minority as
a qualifying circumstance, because it was never duly proven by the prosecution. The Court disagreed.
The qualifying circumstances of age and relationship were not only properly alleged in the
information but were also duly established by the prosecution during the trial of the cases against
Ogarte. Records show that AAA submitted a certification from the Office of the Local Civil Registrar
that her birth records appear in its Register of Births and that her date of birth is listed as June 24,
1980. This certification qualifies as an authentic document. It is also a settled rule that rape may be
proven by the lone uncorroborated testimony of the offended victim, as long as her testimony is clear,
positive, and probable. The RTC was correct in imposing upon Ogarte the penalty of death as it found
Ogarte guilty beyond reasonable doubt of two counts of qualified rape, AAA being Ogartes 16-year-
old daughter when the rapes were committed.
PEOPLE OF THE PHILIPPINES v. BENJAMIN PADILLA y UNTALAN

G.R. No. 182917, 8 June 2011, FIRST DIVISION, (Leonardo De Castro, J.)
In the prosecution of statutory rape cases, force, intimidation and physical evidence of injury
are not relevant considerations; the only subject of inquiry is the age of the woman and whether carnal
knowledge took place.
AAA testified that in September of the year 1999, her mother, BBB, went to work abroad.
Since then, AAA had been living in their house with Benjamin Padilla (Padilla). AAA related that the
incidents of rape charged against Padilla occurred in November 1999, on January 13, 2001 and on
January 14, 2001. In November 1999, AAA recounted that she was changing her clothes as she was
about to go to school. While AAA was changing clothes, Padilla came in, held her arm with his left
hand and his right hand held a bolo. He pushed AAA and the latter fell down on the floor. He told her
not to shout or he would kill her. He proceeded to remove AAA’s short pants and panty. He then went
on top of AAA and inserted his penis into her vagina. Afterwards, he removed his penis, put on his
brief and shorts. As to the alleged second incident of rape, AAA related that the same likewise
occurred in the evening. The third incident of rape allegedly took place on January 14, 2001, at dawn
as AAA slept. Padilla woke up AAA and whispered to her not to shout or he would kill her. He then
removed her shorts and panty and went on top of her, inserted his penis in her vagina. Thereafter,
Padilla left.
AAA said that at noontime on January 14, 2001, she and her younger siblings went to the
house of her aunt, FFF. There, she reported the incidents of rape to FFF. They then waited for AAA’s
grandmother, GGG, and the latter accompanied AAA to the police station. SPO2 Badua recorded the
report in the police blotter and advised GGG that AAA should undergo medical examination. When
GGG and AAA returned, SPO2 Badua took the sworn statement of AAA and he thereafter filed three
(3) criminal complaints in court against Padilla. The Regional Trial Court (RTC) found Padilla guilty
beyond reasonable doubt of three (3) counts of rape. Upon appeal, the Court of Appeals (CA) affirmed
RTC Decision.
ISSUE:
Whether or not Padilla is guilty beyond reasonable doubt of three (3) counts of qualified
rape
RULING:
YES. The element of carnal knowledge was primarily established by the testimony of AAA.
The testimony of AAA that Padilla had sexual intercourse with her was also corroborated by the
medical findings of Dr. Taganas that AAA was no longer physically a virgin. Thus, the Court rules that
the element of carnal knowledge of AAA by Padilla was sufficiently proven in each of the three (3)
counts of rape in this case. Padilla cannot likewise rely on his defense of alibi to disprove the
testimony of AAA. Verily, denial and alibi are inherently weak defenses and constitute self-serving
negative evidence, which cannot be accorded greater evidentiary weight than the positive
declaration of a credible witness. As to the second element of statutory rape, the fact that AAA was
under 12 years of age when the incidents of rape occurred had likewise been clearly established in
the instant case. During the pre-trial conference before the RTC, the parties stipulated that AAA was
born on February 28, 1989 and such fact was also evidenced by the Certificate of Live Birth of AAA.
The age of AAA and her relationship to Padilla qualify the three (3) counts of rape in this case, as
provided for under Article 266-B of the Revised Penal Code.
PEOPLE OF THE PHILIPPINES v. LUCRESIO ESPINA

G.R. No. 183564, 29 June 2011, SECOND DIVISION (Brion, J.)
Sexual intercourse with a girl below 12 years old is statutory rape. In this type of rape, force and
intimidation are immaterial; the only subject of inquiry is the age of the woman and whether carnal
knowledge took place.
On December 7, 1997, AAA, together with her stepmother BBB and stepsister CCC, went to
the dance hall in Barangay Bantigue, Isabel, Leyte, to watch the "benefit dance." At around 11:00 p.m.,
AAA went outside the dance hall to look for her friends. Suddenly, her father, Lucresio Espina
(Espina), called from a nearby mango tree and told her that he has an errand for her. AAA went with
Espina. When they arrived at a "distant dark place, Espina removed his short pants and brief and
removed AAA's panty, ordered her to lie down, went on top of her, and inserted his penis in her
vagina. AAA shouted for help, but Espina covered her mouth with his hands. Thereafter, Espina
ordered AAA to put her panty back on. When Espina asked why there was so much blood in her anus,
AAA replied that it came from her vagina. Espina then threatened to kill her if she reported the
incident to anyone. Espina brought AAA to their house and ordered her to change her clothes. Espina
took AAA's clothes and hid them. Afterwards, they returned to the dance hall. At the dance hall, BBB
told AAA that she had been looking for her. AAA, BBB and CCC returned to their house at around 1:00
a.m.
When AAA was already asleep, DDD, Espina's sister, told BBB to examine AAA because she
noticed that the latter had difficulty climbing the stairs. BBB examined AAA's body and saw blood in
her vagina. When BBB confronted AAA, the latter stated that she had been molested by Espina. BBB
accompanied AAA to the Municipal Health Center of Isabel, Leyte, where the latter was examined.
The prosecution charged Espina before the Regional Trial Court (RTC) with the crime of rape. RTC
found Espina guilty beyond reasonable doubt of qualified rape. On appeal, the Court of Appeals (CA)
affirmed the RTC judgment.
ISSUE:
Whether or not Espina is guilty beyond reasonable doubt of the crime of qualified rape
RULING:
YES. AAA positively identified the appellant as the one who raped her. Her testimony was
clear and straightforward; she was consistent in her recollection of the details of her sexual abuse. In
addition, her testimony was corroborated by the medical findings of Dr. Cerillo. The Court, likewise,
find unmeritorious the Padilla's twin defenses of denial and alibi. Denial could not prevail over the
victim's direct, positive and categorical assertion. It is settled that alibi necessarily fails when there
is positive evidence of the physical presence of the accused at the crime scene or its immediate
vicinity. The prosecution, therefore, positively established the elements of statutory rape under
Article 266-A(d) of the Revised Penal Code. First, Padilla succeeded in having carnal knowledge with
the victim. Not only did AAA identify her father as her rapist, she also recounted the sexual abuse in
detail. Second, the prosecution established that AAA was below 12 years of age at the time of the rape.
During the pre-trial, the parties admitted that AAA was only 11 years old at the time of the
commission of the crime.
PEOPLE OF THE PHILIPPINES v. MARCIANO DOLLANO, JR.

In the crime of Statutory Rape, what the law punishes is carnal knowledge of a woman below
twelve (12) years of age; Qualified Rape is committed when the victim is under eighteen (18) years of
age and the offender is a parent, ascendant, step-parent, guardian, relative by consanguinity or affinity
within the third civil degree, or the common law spouse of the parent of the victim.
The prosecution alleged that AAA was raped by her father, Marciano Dollano (Dollano). The
first incident occurred at nighttime, inside their house, but AAA could not recall the exact date when
it happened. At that time, she was home, together with her two younger brothers, her sister BBB, and
Dollano. While she and her siblings were sleeping inside their room, Dollano, who was beside her,
removed her shorts and panty, went on top of her, then inserted his penis in her vagina. She felt pain
after that. However, she could not ask help from her brothers, who were sound asleep, because of
fear as her father was then holding a bolo. The second incident took place when she was in grade II
inside a hut. As in the first incident, the second rape happened at nighttime while she, her brothers,
and sister were sleeping. These incidents were allegedly repeated for the third, fourth, and fifth times.
AAA did not have the courage to tell anybody about her ordeal. She only had the chance to reveal the
incidents when her sister suffered appendicitis and they needed the assistance of the Department of
Social Work and Development (DSWD). Also, BBB was raped twice by her father, Dollano. The first
incident took place when BBB was more than 12 years old. She was living with Dollano, together with
her sister and younger brothers. It was also nighttime and while she and her siblings were sleeping,
when she was raped. The second incident happened when BBB was 14 years old, again in their house
and was raped in the same manner as the first incident.
The defense, on the other hand, presented the brother of AAA and BBB who testified that he
did not believe that their father could rape her sisters. In a sudden turn of events, more than four
years after they testified in court for the prosecution, AAA and BBB retracted their previous
testimonies that they were raped by their father. AAA explained that she was recanting her previous
testimony because she had forgiven her father and he already suffered for a long time and repented
for what he had done. She claimed that she filed the case against her father because the latter had
been maltreating her. BBB likewise recanted her earlier testimony and claimed that she had forgiven
Dollano. The Regional Trial Court (RTC) convicted Dollano of two counts of Statutory Rape and two
counts of Qualfied Rape, and was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not Dollano is guilty beyond reasonable doubt of the crimes of Statutory and
Qualified Rape.
RULING:
YES. In the crime of Statutory Rape, what the law punishes is carnal knowledge of a woman
below 12 years of age. Thus, the only subject of inquiry is the age of the woman and whether carnal
knowledge took place. The law presumes that the victim does not and cannot have a will of her own
on account of her tender years. As clearly shown in the narration of facts, the prosecution was able
to establish that Dollano succeeded in having carnal knowledge with AAA in 1995, or three months
after the death of her mother. The incident was repeated in 1997. AAAs testimony was corroborated
by the medical findings. It was also established through AAA’s birth certificate that she was born on
September 10, 1987. Thus, at the time of the commission of the first rape incident in 1995, AAA was
only eight (8) years old; and at the time of the second rape incident in 1997, she was only 10 years
old. Statutory rape was, therefore, committed in 1995 and 1997.
As to BBB, considering that she was less than 18 years of age, and considering further that
the crimes were committed by her own father, the CA was correct in convicting Dollano of Qualified
Rape. Article 266-B of the RPC is applicable which states that the death penalty shall be imposed if
the crime of rape is committed with an aggravating/qualifying circumstance, as when the victim is
under eighteen (18) years of age and the offender is a parent, ascendant, step-parent, guardian,
relative by consanguinity or affinity within the third civil degree, or the common law spouse of the
parent of the victim.
PEOPLE OF THE PHILIPPINES v. RODEL SINGSON

G.R. No. 194719, 21 September 2011, THIRD DIVISION (Abad, J.)
Testimonial evidence, to be believed, must not only come from credible lips but must be credible
in substance. A story that defies reason and logic and above all runs against the grain of common
experience cannot persuade.
MJ and Rodel Singson are sweethearts from January to September 2003. In the evening of
December 22, 2003 MJ and her mother, LK, attended the simbang gabi from 9:00 p.m. to 10:00 p.m.
After the mass, LK wanted to join some church members to go caroling. Since MJ felt sleepy, she bade
her mother leave to go home at about 11:30 p.m. On reaching home, MJ prepared to go to bed but
someone knocked at their door. Thinking it was her mother, she opened it and, to her surprise, saw
Rodel standing at the door. Rodel said that he wanted to talk to MJ about renewing their relation. She
was at first hesitant to entertain him because he appeared drunk but she eventually let him in. After
talking with Rodel at the living room for about 45 minutes, MJ asked him to leave and he did. MJ then
entered her room. But, suddenly, Rodel appeared and sprayed something on her face that made her
feel weak and dizzy. Her vision also became blurred. After undressing her, Rodel touched her body
in various parts. Eventually, he violated her. She could only cry until she lost consciousness.
MJ then woke up to the screams of her brother who was gripping Rodel by the bedroom
window. As it turned out, when LK came home at 2:00 a.m., she knocked at MJ’s bedroom to check if
she had gotten home safely but LK got no answer. Worried, LK used a key to open the door and she
saw MJ naked and unconscious on the bed. Noticing unfamiliar clothes on the floor, LK became
suspicious and looked around. When she checked under the bed, she saw Rodel there in his
underwear. LK shouted for help, waking up her sister who happened to be the barangay chairman of
their village. Some barangay tanods came. They moved MJ to another room and arrested Rodel. It
was to her aunt that MJ told her story because the incident affected her mother deeply. Rodel, on the
other hand, insisted that he and MJ freely had sexual intercourse borne of their mutual affection. He
did not rape her. But, declining to give credence to his defense, the Regional Trial Court (RTC) found
Rodel guilty of rape. The Court of Appeals (CA) affirmed the RTC decision.
ISSUE:
Whether Rodel raped MJ after spraying her with drugs that weakened her resistance and
eventually rendered her unconscious.
RULING:
NO. One of the ways of committing rape, according to Article 335 of the Revised Penal Code,
as amended by Section 11 of Republic Act 7659, is by having carnal knowledge of a woman when she
has been deprived of reason or otherwise rendered unconscious. The prosecution claims that this
was Rodel’s crime. But the Court doubts MJs story. MJs story is at variance with what she said in her
December 23, 2003 affidavit which she executed only hours after the incident. The testimony of LK,
MJs mother, is just as dubious.
Testimonial evidence, to be believed, must not only come from credible lips but must be
credible in substance. A story that defies reason and logic and above all runs against the grain of
common experience cannot persuade. Here, the prosecutions account failed to pass these tests. It
seems, considering all the testimonies that what happened is that, since they were alone in the house,
Rodel and MJ lost control and made love. When MJs mother suddenly showed up and opened her
daughters room with a key, Rodel hid under the bed. But the suspicious mother, finding her daughter
naked, looked for him under the bed. LK summoned her sister, the barangay chairman, her son and
her brother-in-law, both tanods and seized Rodel. Asked if she preferred getting married to
continuing her studies, MJ must have chosen the latter. And, to save face, her relatives who had
political power made it look like Rodel raped her.
PEOPLE OF THE PHILIPPINES v. MARCELO PEREZ

G.R. No. 191265, 14 September 2011, SECOND DIVISION (Perez, J.)
Inconsistent statements of the victim in the crime of rape or other trivial matters will not lie to
contradict the credible testimony of the victim and are not essential to establish the guilt of the accused
as long as the elements are duly proven.
AAA was awakened by Marcelo Perez (Perez), her brother-in-law, who dragged her to the
bathroom. Inside the bathroom, Perez covered AAA’s mouth with a piece of cloth. Perez then removed
his clothes and then began undressing AAA. He put his brief into AAAs mouth. He forced AAA down
and then inserted his penis into AAA’s vagina. Perez managed to slash the wrist of AAA who then lost
consciousness. On cross-examination, AAA narrated that she did not offer any resistance because
appellant threatened her with a knife. When AAA regained consciousness, she found herself beside
her mother BBB.
BBB testified that she was in Manila when her daughter CCC called up to inform her that AAA
was raped. BBB, together with AAA, proceeded to the police station to report the incident. She saw
the wound on AAAs wrist, as well as the brief placed by Perez inside AAA’s mouth. Dr. Tirzo de los
Reyes, Jr. (Dr. de los Reyes) conducted a physical examination on AAA two (2) days after the alleged
rape incident, and issued a medico-legal certification. Perez, on the other hand, never testified inspite
of numerous re-settings of the trial. The defense rested their case without presenting any
documentary or any other testimonial evidence. The Regional Trial Court (RTC) rendered judgment
finding appellant guilty beyond reasonable doubt of the crime of rape. Perez filed a notice of appeal.
The Court of Appeals affirmed the trial court’s Decision in toto.
Perez attacks the credibility of the victim by pointing out alleged incredulities and
inconsistencies in her testimony. The claim of AAA that her mother was inside the house when the
rape was allegedly committed ran counter to her statement that her mother was in fact in Manila at
that time. Perez contest the findings contained in the medico-legal report. The absence of fresh
laceration or any sign of trauma does not jive with AAA’s claim that she was raped through the use
of force and intimidation. On the other hand, the Office of the Solicitor General (OSG) dismissed the
inconsistencies in AAA’s testimony as inconsequential. The OSG belittles the medical findings on the
absence of laceration or trauma on the victim’s body as the same is not indispensable to prove the
crime of rape.
ISSUE:
Whether the prosecution was able to prove the guilt of Perez beyond reasonable doubt
despite the inconsistent statement of AAA as to her mother’s whereabouts at the time of the incident
and the absence of laceration in the medico-legal report.
RULING:
YES. The elements necessary to sustain a conviction for rape are: (1) that the accused had
carnal knowledge of the victim; and (2) that said act was accomplished (a) through the use of force
or intimidation, or (b) when the victim is deprived of reason or otherwise unconscious, or (c) when
the victim is under 12 years of age or is demented. All elements of rape under Article 266-A of the
Revised Penal Code were sufficiently proved through the statement of AAA alone. The offender is a
man who had carnal knowledge of AAA when he forced himself upon the latter. Appellant
accomplished his purpose through the use of threat, i.e. threatening to kill AAA. In fact, it is under
these same threats that AAA was not able to resist nor summon for help.
The inconsistency of AAA’s statement pertaining to the presence of BBB at the crime scene can be
easily dismissed. Indeed, the presence of BBB at the locus criminis is of no moment. It is not an
essential element to establish the crime of rape. The inconsistent statements of AAA pertaining to
BBB may be attributed to the fact that she was very confused at that time and she is not expected to
remember each and every detail of the events that transpired that day, especially matters which are
trivial and inconsequential. The appellate court is likewise correct in downplaying the medico-legal
findings which it ruled as merely corroborative in character and is not an element of rape. The prime
consideration in the prosecution of rape is the victim's testimony, not necessarily the medical
findings; a medical examination of the victim is not indispensable in a prosecution for rape. The
victim's testimony alone, if credible, is sufficient to convict.
PEOPLE OF THE PHILIPPINES v. JOSELITO ORJE y BORCE

Rape is no longer considered a personal crime but a crime against persons. In effect, rape may
now be prosecuted de oficio.
AAA, 16 years old, woke up with the feeling of something heavy pressing on her body. It
turned out to be her father, Joselito Orje (Orje), on top of her. At that point, Orje proceeded to strip
her of her shorts, then her underwear and then inserted his penis into her vagina. She attempted to
shout and struggled to break free, but her efforts proved futile at the start as Orje was holding her
hands and covering her mouth at the same time. Eventually, however, she succeeded in extricating
herself and got hold of a chair which she threw at Orje. AAA further narrated that two days after that
harrowing incident, Orje slapped her for arriving home late. Thereafter, AAA repaired to her bedroom
and took a bath. As she was combing her hair after her bath, Orje suddenly came up from behind and
started to fondle her breasts. This turn of events prompted AAA to run to her cousin (BBB) for help
and, in the latter’s house, AAA confided what she had just gone through. BBB informed her parents
who, in turn, reported the matter to the police. AAA also testified that, apart from the above incidents,
Orje also molested her in twice before. She, however, kept both painful episodes to herself out of fear
that her father would make good on his threat to kill her mother. AAA likened the abuse she received
in the hands of her father to being treated as a prostitute. On the witness stand, she stated wanting
her father to land in jail for what he had done to her.
The defense called to the witness stand AAA who earlier executed a Sinumpaang Salaysay
(affidavit of desistance), in which she expressed her desire to desist from pursuing the sham case
against her father. As she explained while testifying this time, the rape incidents never happened.
AAA pointed to her aunt, CCC, as having compelled her to falsely accuse her father to get back at him
for leaving the family when AAA was barely nine years old. AAA also testified being mad at Orje for
the slap she got after arriving home late one rainy night. The Regional Trial Court (RTC) found Orje
guilty beyond reasonable doubt of the crime charged. On appeal, the Court of Appeals affirmed the
RTC’s Decision.
ISSUE:
Whether AAA’s affidavit of desistance is a ground for the dismissal of the case.
RULING:
NO. Rape is no longer considered a personal criminal offense listed as among the crimes
against chastity defined and punishable under Title 11 of the RPC, as amended. Republic Act No. (RA)
8353, or the Anti-Rape Law of 1997, has reclassified rape as a crime against persons. In effect, rape
may now be prosecuted de oficio; a complaint for rape commenced by the offended party is no longer
necessary for its prosecution. As corollary proposition, an affidavit of desistance by the complaining
witness is not, by itself, a ground for the dismissal of a rape action over which the court has already
assumed jurisdiction.
Courts look with disfavor on affidavits of desistance and/or retraction. In People v. Bation,
the Court explained why: An affidavit of desistance can easily be secured from poor and ignorant
witnesses, usually for monetary considerations and because it is quite incredible that after going
through the process of having the accused apprehended by the police, positively identifying him as
the rapist, and enduring humiliation and examination of her private parts, the victim would suddenly
declare that the wrongful act of the accused does not merit prosecution. And still another reason: An
affidavit of desistance is merely an additional ground to buttress the accused’s defenses, not the sole
consideration that can result in acquittal. There must be other circumstances which, when coupled
with the retraction or desistance, create doubts as to the truth of the testimony given by the witnesses
at the trial and accepted by the judge.
Accused-appellant cannot plausibly bank on AAA’s affidavit of desistance, complemented by

her testimony for the defense, as an exonerating vehicle for his dastardly act. Other than the
retraction or desistance affidavit, nothing in the records would show any other circumstance of
substance accepted by the trial court that would becloud the veracity of AAAs earlier inculpating
testimony. As long as the complaining witness musters the test of credibility and consistency, her
testimony deserves full faith and confidence and cannot be discarded. And if such testimony is clear
and credible to establish the crime beyond reasonable doubt, a conviction of rape based on it may lie
even if she subsequently retracted her earlier testimony.
PEOPLE OF THE PHILIPPINES v. ARNEL MANJARES

When a woman declares that she has been raped, she says in effect all that is necessary to show
that rape has been committed and, where her testimony passes the test of credibility, the accused can
be convicted on the basis thereof.
Arnel Manjares (Manjares) was charged of having raped his own daughter AAA in 164
different occasions, from the period of April 1992 until September 1995. AAA was only 14 years old
when her father started raping her. AAA testified in open court how his father sexually molested her
when her mother is not in the house. She narrated that her father would wake her up and forcibly
insert his finger then his penis into her vagina. Manjares threatened AAA not to tell anyone or else he
would hurt her and her siblings. AAA was able to write in her diary some of the incidents when her
father raped her. She was impregnated by her own father when she was 17 years old. It was only at
that time that she was able to disclose her ordeal to her mother and relatives. The Regional Trial
Court (RTC) convicted Manjares for the crime of twenty-seven (27) counts of rape. The Court of
Appeals (CA) affirmed. Manjares now argues that the testimony of AAA was inconsistent and
uncorroborated and that the elements of the crime of rape under Article 335 of the Revised Penal
Code were not present in the facts of the instant case.
ISSUE:
Whether or not the prosecution was able to prove the guilt of Manjares beyond reasonable
doubt.
RULING:
YES. Given that the incidents of rape occurred prior to the enactment of Republic Act No.
8353 (Anti-Rape Law of 1997), the applicable law is Article 335 of the Revised Penal Code. The
elements of rape under the said provision of law are: (1) the offender had carnal knowledge of the
victim; and (2) such act was accomplished through force or intimidation; or when the victim is
deprived of reason or otherwise unconscious; or when the victim is under 12 years of age. Contrary
to appellant’s assertions, all the essential elements of rape are present in the case at bar. The evidence
on record, particularly the victim’s detailed and damning testimony, clearly proves that the appellant
had carnal knowledge of his own minor daughter on multiple occasions.
In a prosecution for rape, the accused may be convicted solely on the basis of the testimony
of the victim that is credible, convincing, and consistent with human nature and the normal course of
things, as in this case. There is a plethora of cases which tend to disfavor the accused in a rape case
by holding that when a woman declares that she has been raped, she says in effect all that is necessary
to show that rape has been committed and, where her testimony passes the test of credibility, the
accused can be convicted on the basis thereof. Furthermore, the Court has repeatedly declared that
it takes a certain amount of psychological depravity for a young woman to concoct a story which
would put her own father to jail for the rest of his remaining life and drag the rest of the family
including herself to a lifetime of shame. For this reason, courts are inclined to give credit to the
straightforward and consistent testimony of a minor victim in criminal prosecutions for rape.
The Court has previously held that the delay in reporting a rape could be attributed to the
victim’s tender age and the appellant’s threats. A rape victim’s actions are oftentimes influenced by
fear, rather than reason. In incestuous rape, this fear is magnified because the victim usually lives
under the same roof as the perpetrator or is at any rate subject to his dominance because of their
blood relationship.
SIMPLE RAPE
PEOPLE OF THE PHILIPPINES v. SIXTO PADUA y FELOMINA

For the victim’s minority to be appreciated, the prosecution must prove through independent
evidence that the victim was less than 12 years old when the rape was committed.
In 1991, six-year-old AAA was playing at the balcony of their house while her mother and
siblings were not around. His uncle, Sixto Padua (Padua), was watching TV when he told AAA to sit
beside him and remove her shorts and underwear. Padua then removed his own clothing and then
inserted his penis in AAA’s vagina. AAA did not tell anyone what happened because she did not know
that what was done to her was wrong. She only realized that she was sexually abused when she was
in 6th grade, when she was about 12 or 13. After she graduated from elementary, she told her sister
CCC what happened. CCC later on confessed that she experienced the same thing with Padua when
she was also younger. Eventually, their father found out and took AAA to the police. The medical
examination showed that AAA was indeed no longer a virgin.
The Regional Trial Court (RTC) convicted Padua of rape and it appreciated AAA’s minority
based on her testimony, which Padua failed to rebut. The Court of Appeals (CA) affirmed the decision
as to the crime but did not appreciate AAA’s minority because it was not proven. Instead, the CA
appreciated force and intimidation, noting that Padua’s relation to AAA had been proven by his own
admission. It stressed that in incestuous rape, the moral ascendancy of the accused over the victim
takes the place of force and intimidation
ISSUE:
Whether or not Padua is guilty only of simple rape.
RULING:
YES. We agree with the CA that the appellant cannot be held liable for qualified, much less
statutory, rape; the prosecution failed to prove by independent evidence the age of AAA, much less
the allegation that she was under the age of 12 when she was raped. The appellate court properly
appreciated force and intimidation. In rape committed by a close kin, such as the victim's father,
stepfather, uncle, or the common-law spouse of her mother, it is not necessary that actual force or
intimidation be employed; moral influence or ascendancy takes the place of violence or intimidation.
Thus, the CA properly convicted the appellant for simple rape whose penalty is reclusion
perpetua. We, however, clarify the applicable law. The CA held that the appellant was guilty of simple
rape under Article 266-A(1) of the Revised Penal Code. However, the crime was committed in 1991,
i.e., prior to the passage of the law imposing the death penalty for rape cases and prior to the new
rape law. The law then in place Article 335 of the Revised Penal Code should apply. Under this law,
simple rape is punishable by reclusion perpetua.
PEOPLE OF THE PHILIPPINES v. ANTONIO OTOS alias ANTONIO OMOS
The accused can only be convicted of simple rape if the prosecution failed to present a birth
certificate or other authentic document (such as a baptismal certificate), and to make a positive and
unequivocal manifestation that the victim was below seven years old at the time of the incident.
On the night of June 14, 2000, Otos brought his five-year-old stepdaughter AAA to the
cornfield in their farm. He laid the victim down, took off her panties, and inserted his penis into her
vagina. AAA felt extreme pain. Thereafter, he went home, threatening AAA not to tell her mother
about the incident or he would kill her. After that incident, Otos still raped AAA many times. She
suffered stomachache and felt pain whenever she urinated. One day when Otos was not around, AAA
told her mother, BBB, about the incidents. BBB got mad, prompting herself and AAA to leave the
house thereafter. The medical examination revealed that AAA had an inflamed labia minora with
multiple abrasions and that she suffered from a urinary tract infection.
The prosecution charged Otos of multiple rape. Otos denied the accusations and claimed that
BBB fabricated the story out of anger because he struck her and ejected her from their house. The
Regional Trial Court (RTC) convicted Otos of qualified rape and sentenced him to the penalty of death.
The Court of Appeals (CA) downgraded the offense to simple rape because there was no independent
evidence that AAA was below seven years old, and that Otos was incorrectly claimed as the
stepfather, when in fact he is merely the common law spouse of BBB.
ISSUE:
Whether or not Otos is guilty of simple rape only.
RULING:
YES. Where the victim is a child, the absence of medical evidence of penetration does not
negate the commission of rape. The presence of hymenal lacerations is not a required element in the
crime of rape. What is essential is evidence of penetration, however slight, of the labia minora, which
circumstance was proven beyond doubt by the testimony of AAA. Besides, the prime consideration
in the prosecution of rape is the victim's testimony, not necessarily the medical findings; a medical
examination of the victim is not indispensable in a prosecution for rape. The victim's testimony alone,
if credible, is sufficient to convict. AAA was categorical and straightforward in narrating the sordid
details of how the appellant ravished her.
We find that the CA correctly downgraded Otos’ offense to simple rape due to the
prosecution’s failure to present AAAs birth certificate or other authentic document (such as a
baptismal certificate), and to make a positive and unequivocal manifestation that AAA was indeed
five years old at the time of the incident.
PEOPLE OF THE PHILIPPINES v. RONALDO SALUDO

The act of holding a knife by itself is strongly suggestive of force or, at least, intimidation, and
threatening the victim with a knife is sufficient to bring a woman into submission.
AAA was then 14 years old who lives in a nipa hut with her mother and her younger sister.
AAA and Ronaldo Saludo (Saludo) are neigbors. One evening, AAA’s mother attended a pabasa, so it
was just AAA and her younger sister in their home. That night, AAA was awakened when she felt
someone entered their hut. It was Saludo. Immediately after seeing Saludo, AAA stood up and shouted
at Saludo on what he was doing there. Saludo approached her and closed her mouth with his hand.
AAA pushed Saludo but the latter poke a “balisong” knife at her. There and then, Saludo took off her
shorts and panty. Then Saludo placed himself on top of her, tried hard to insert his penis to her vagina.
Ultimately, Saludo succeeded in raping AAA. Saludo threatened AAA that she and her mother would
be killed, if AAA would tell anybody what have transpired. After he uttered his threat to her, Ronaldo
Saludo left the place. The incident happened for three more times.
Sometime thereafter, AAA’s mother became suspicious since AAA’s abdomen is becoming
bigger. Hence, AAA told her mother that she was raped and impregnated by Saludo. As a result, Saludo
was charged with four counts of rape. By way of defense, Saludo raised denial and alibi. Saludo also
attempted to discredit AAA’s testimony. The trial court found Saludo guilty of four counts of rape. On
appeal, the appellate court affirmed the conviction. Hence, this appeal.
ISSUE:
1. Whether or not Saludo is guilty of four counts of simple rape.

2. Whether or not the qualifying circumstance of use of a deadly weapon may be appreciated
in this case.
RULING:
1. YES. The prosecution’s evidence established beyond reasonable doubt all elements of rape
committed against AAA on four occasions. The supposed defects in AAA’s testimony, pointed out by
Saludo, do not diminish AAA’s credibility. It should be remembered that the declarations on the
witness stand of rape victims who are young and immature deserve full credence. Here, AAA was
only 14 years old when she was mercilessly corrupted by a conscienceless human being with bestial
desires. With more reason must we accord to her greater understanding, consideration, and
sensitivity as she relives, through her testimony, her harrowing experiences at Saludo’s hands.
Saludo plays up the fact that during the sexual assault, AAA did not offer any tenacious
resistance; and argues that the requisite of force and intimidation for the crime of rape is lacking. The
Court disagreed. Physical resistance need not be established in rape when threats and intimidation
are employed and the victim submits herself to the embrace of her rapist because of fear. Saludo in
this case held a knife against AAA during the rapes. The act of holding a knife by itself is strongly
suggestive of force or, at least, intimidation, and threatening the victim with a knife is sufficient to
bring a woman into submission. Saludo further avers that AAA’s behavior during and after the alleged
rapes were not in accordance with human conduct and experience. Not every victim of rape can be
expected to act with reason or in conformity with the usual expectations of everyone. The workings
of a human mind placed under emotional stress are unpredictable; people react differently. Some
may shout, some may faint, while others may be shocked into insensibility.
2. NO. While AAA, in the instant case, testified that Saludo was able to rape her after
threatening her with a knife, the use of a deadly weapon in the commission of the rape was not alleged
in the Informations. Thus, even when it was proved, Saludo’s use of a knife cannot be appreciated as
a qualifying circumstance, and it cannot affect the penalty to be imposed upon Saludo. Accordingly,
Saludo should be sentenced to reclusion perpetua for each of the four counts of simple rape.
PEOPLE OF THE PHILIPPINES v. JONIE DOMINGUEZ

For rape incidents in which the victim is below 12 years old, proof of threats, force or
intimidation, is not necessary; for relationship to aggravate or qualify the crime of rape committed
against a minor, the accused must be a relative of the victim within the third civil degree.
AAA, was allegedly raped twice by her grandfather, Jonie Dominquez (Dominguez), first in
2001, when she was only nine (9) years old, and the second, in 2002, when Dominguez inserted his
two fingers into AAA’s sex organ under the circumstance of intimidation with a knife. BBB, on the
other hand, was allegedly raped seven times: first in 2000, when she was 12 years old through force,
violence, and intimidation, and moral ascendancy; and again from 2001 to 2002, committed by the
insertion of a finger into BBB’s sex organ, also through force, violence, intimidation and moral
ascendancy. AAA and BBB chose to stay silent about the rape incidents, until their mother
accidentally overheard Dominguez in his drinking session, boasting that their vaginas were already
wide. The girls were brought to a doctor for examination, and it was found that AAA’s hymen was
intact, but no finding that the child could have been molested. In contrast, BBB was found to have old
hymenal lacerations.
Dominguez was charged with nine (9) counts of rape with the aggravating circumstance of
relationship as a special qualifying circumstance. During trial, AAA and BBB testified that Dominquez
had employed trickery so that either of them would be left alone with him and thereafter raped, with
threats of harm to her person or her family. As to the second rape, AAA was silent on the alleged
sexual intercourse. She in fact did not mention it, but merely testified that the accused inserted his
fingers into her vagina on two occasions. Dominguez raised the defense of denial and alibi, that he
was in the mountains on the dates that he was alleged to have committed the crimes. The Regional
Trial Court (RTC) found him guilty of two (2) counts of Statutory Rape and six (6) counts of Simple
Rape. The same was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not the prosecution established Dominguez’s guilt beyond reasonable doubt.
RULING:
YES. The prosecution was able to show the existence of the elements of rape under the
amended Revised Penal Code, effectuated by R.A. No. 8353, or the Anti-Rape Law of 1997. Thus, rape
is committed: (1) by a man who shall have carnal knowledge of a woman under any of the following
circumstances: (a) through force, threat, or intimidation; (b) when the offended party is deprived of
reason or otherwise unconscious; (c) by means of fraudulent machination or grave abuse of
authority; and (d) when the offended party is under twelve (12) years of age or is demented, even
though none of the circumstances mentioned above be present; and (2) by any person who, under
any of the circumstances mentioned, shall commit an act of sexual assault by inserting his penis into
another person’s mouth or anal orifice, or any instrument or object, into the genital or anal orifice of
another person.
In this case, before and after the violations, the intimidation took the form of threats that the
victims’ family would be killed by Dominguez. He also employed trickery and took advantage of his
authority over his grandnieces. Under these circumstances, he was able to have carnal knowledge of
BBB and commit a series of sexual assaults against both her and AAA. The two incidents of rape
against AAA happened before she reached 12 years of age, she being 9 and 10 then. For those
incidents, proof of threats, force or intimidation, is not necessary. However, contrary to the claim of
the prosecution, the accused’s relationship to the victims cannot be considered as an aggravating
circumstance. For relationship to aggravate or qualify the crime of rape committed against a minor,
the accused must be a relative of the victim within the third civil degree. As a brother of the victims’
paternal grandmother, he is but a relative within the fourth civil degree. This relationship cannot
qualify the crime as to merit the punishment of reclusion perpetua to death under Article 266-B of
the Revised Penal Code, as amended. Thus, the rape of BBB by means of carnal knowledge was simple
rape.
PEOPLE OF THE PHILIPPINES v. TERENCIO FUNESTO

G.R. No. 182237, 03 August 2011, SECOND DIVISION (BRION, J.)
In People v. Pruna, the Court set out the following guidelines in appreciating age, either as an
element of the crime or as a qualifying circumstance and that the Regional Trial Court must make a
categorical finding of the party’s age.
The prosecution alleges Terencio Funesto of the crime of rape wherein they presented
evidence that when the mother, BBB, was in a prayer meeting, Funesto took advantage of AAA, a nine-
year old, being alone in their house, and forcibly inserted his penis into her vagina. There was a
residue of blood and AAA was unable to move and push Funesto away. Upon coming back from the
prayer meeting, BBB noticed the residue of blood and inquired her daughter what happened to which
AAA divulged. BBB confronted Funesto but was stopped since the latter threatened to kill her if she
made any reports to law enforcement. She took her daughter the next day to the hospital due to the
pain of urinating and incapability to stand. The findings of the physician found the presence of semen
in AAA’s vagina.
The Regional Trial Court (RTC) found Funesto guilty of the crime of statutory rape wherein it
concluded that even if the prosecution failed to present the evidence of birth certificate that
authenticates AAA’s birth, it was not objected by the opposing party, as such, it may be admitted. The
Court of Appeals (CA) likewise ratiocinated in the same wise.
ISSUE:
Whether or not Funesto should be guilty of statutory rape.
RULING:
NO. Funesto should only be guilty of the crime of simple rape for the failure of the prosecution
to present and likewise prove the evidence of the qualifying circumstance of age when it comes to
statutory rape. The prosecution has the burden of proving the age and the Court has set in the case
of People v. Pruna that the best evidence to prove such age is the birth certificate of the victim and
other such documents such as baptismal certificate and school records. None supporting documents
nor testimonies were heard, and as such Funesto should only be liable for the crime of simple rape.
Sweetheart Theory or Sweetheart Defense
PEOPLE OF THE PHILIPPINES v. REYNALDO OLESCO

The ‘sweetheart theory’ or ‘sweetheart defense’ is an oft-abused justification that rashly derides
the intelligence of this Court and sorely tests our patience. For the Court to even consider giving credence
to such defense, it must be proven by compelling evidence. The defense cannot just present testimonial
evidence in support of the theory, as in the instant case. Independent proof is required—such as tokens,
mementos, and photographs.
One evening, AAA passed by a bakery where Reynaldo Olesco (Olesco) was working.
Thereafter, somebody pulled AAA and covered her mouth with a hanky which caused her to be
unconscious. When she regained consciousness, AAA found herself naked beside Olesco inside a
room located near the bakery. Her whole body ached, especially her cheeks, tummy and her private
part. AAA then slapped Olesco and asked him why he raped her. Olesco answered that he would kill
her should she report the incident to the police. After a while, Olesco told AAA to go home. She
dressed up immediately and went home running. After two days, AAA reported the incident to the
authorities. Thus, Olesco was charged with the crime of rape. Olesco interposed as defense the
sweetheart theory. Both the trial court and the appellate court found Olesco guilty beyond reasonable
doubt of the crime of rape. Hence, this appeal.
ISSUE:
Whether or not Olesco is guilty of the crime of rape.
RULING:
YES. The Court of Appeals (CA) correctly disregarded Olesco’s claim that he did not use force
nor resort to intimidation in the commission of the crime. The Court agreed with the CA that Olesco’s
act of pulling AAA and covering her face with drug-laced handkerchief is synonymous with force.
Moreover, Both the trial court and the CA properly disregarded Olesco’s claim that he and AAA were
sweethearts. The ‘sweetheart theory’ or ‘sweetheart defense’ is an oft-abused justification that rashly
derides the intelligence of this Court and sorely tests our patience. For the Court to even consider
giving credence to such defense, it must be proven by compelling evidence. The defense cannot just
present testimonial evidence in support of the theory, as in the instant case. Independent proof is
required—such as tokens, mementos, and photographs. There is none presented here by the defense.
In any event, the claim is inconsequential since it is well-settled that being sweethearts does
not negate the commission of rape because such fact does not give Olesco license to have sexual
intercourse against AAA’s will, and will not exonerate him from the criminal charge of rape. Being
sweethearts does not prove consent to the sexual act. Thus, having failed to satisfactorily establish
that AAA voluntarily consented to engage in sexual intercourse with him, the said act constitutes rape
on the part of the Olesco.
PEOPLE OF THE PHILIPPINES v. FELIPE MIRANDILLA, JR.
Bare invocation of sweetheart theory cannot alone, stand. To be credible, it must be

corroborated by documentary, testimonial, or other evidence such as letters, notes, photos, mementos,
or credible testimonies of those who know the lovers.
AAA was with her sister at the plaza during the eve of the fiesta in their barangay. AAA went
out of the dancing hall to buy candies in a nearby store. While making her way back through the
crowd, a man grabbed her hand, his arm wrapped her shoulders, with a knife’s point thrust at her
right side. He would later be identified as Felipe Mirandilla, Jr. For 39 days, AAA was repeatedly raped
by Mirandilla until she was able to escape and report the incident to the police.
Mirandilla was charged with kidnapping with rape, 4 counts of rape, and rape through sexual
assault. The Regional Trial Court (RTC) found Mirandilla guilty. Upon appeal, the Court of Appeals
(CA) affirmed with modification the RTC ruling, convicting Mirandilla. It found him guilty instead of
the special complex crime of kidnapping with rape, 4 counts of rape, and one count of rape by sexual
assault. Mirandilla maintains that he and AAA were live-in partners and that their repeated sexual
intercourse was consensual.
ISSUES:
1. Whether or not the Sweetheart Theory was successfully proven by Mirandilla.

2. Whether or not the charges filed against Mirandilla were proper.
RULING:
1. NO. Mirandilla’s bare invocation of sweetheart theory cannot alone, stand. To be credible,
it must be corroborated by documentary, testimonial, or other evidence. Usually, these are letters,
notes, photos, mementos, or credible testimonies of those who know the lovers. The sweetheart
theory as a defense, however, necessarily admits carnal knowledge, the first element of rape.
Effectively, it leaves the prosecution the burden to prove only force or intimidation, the coupling
element of rape. Love, is not a license for lust. This admission makes the sweetheart theory more
difficult to defend, for it is not only an affirmative defense that needs convincing proof; after the
prosecution has successfully established a prima facie case, the burden of evidence is shifted to the
accused, who has to adduce evidence that the intercourse was consensual. Taken individually and as
a whole, the defense witnesses testimonies contradicted each other and flip-flopped on materials
facts, constraining this Court to infer that they concocted stories in a desperate attempt to exonerate
the accused.
2. NO. To reiterate, the six informations charged Mirandilla with kidnapping and serious
illegal detention with rape (Crim. Case No. 9278), four counts of rape (Crim. Case Nos. 9274-75-76-
77), and one count of rape through sexual assault. AAA was able to prove each element of rape
committed under Article 266-A, par.1(a) of the Revised Penal Code (RPC), that (1) Mirandilla had
carnal knowledge of her; (2) through force, threat, or intimidation. She was also able to prove each
element of rape by sexual assault under Article 266-A, par. 2 of the Revised Penal Code: (1) Mirandilla
inserted his penis into her mouth; (2) through force, threat, or intimidation.
However, no matter how many rapes had been committed in the special complex crime of
kidnapping with rape, the resultant crime is only one kidnapping with rape. This is because these
composite acts are regarded as a single indivisible offense as in fact R.A. No. 7659 punishes these acts
with only one single penalty. In a way, R.A. 7659 depreciated the seriousness of rape because no
matter how many times the victim was raped, like in the present case, there is only one crime
committed the special complex crime of kidnapping with rape. It having been established that
Mirandilla’s act was kidnapping and serious illegal detention (not forcible abduction) and on the
occasion thereof, he raped AAA several times, We hold that Mirandilla is guilty beyond reasonable
doubt of the special complex crime of kidnapping and serious illegal detention with rape, warranting
the penalty of death. However, in view of R.A. No. 9346 entitled, An Act Prohibiting the Imposition of
Death Penalty in the Philippines, the penalty of death is hereby reduced to reclusion perpetua,
without eligibility for parole.
CRIMES AGAINST PERSONAL LIBERTY AND SECURITY
Kidnapping
PEOPLE OF THE PHILIPPINES v. AIDA MARQUEZ

The Court, in elucidating on the elements of Article 270, stated that while one of the essential
elements of this crime is that the offender was entrusted with the custody of the minor, what is actually
being punished is not the kidnapping but the deliberate failure of that person to restore the minor to his
parents or guardians.
Carolina Cunanan Merano (Merano) was working at a beauty parlor as a beautician. She had
a three-month old daughter Justine Bernadette C. Merano (Justine). Merano met Aida Marquez
(Marquez) at the said beauty parlor. Merano confessed to easily trusting Marquez because aside from
her observation that Marquez was close to her employers, Marquez was also nice to her and her co-
employees, and was always giving them food and tip. On September 6, 1998, after a trip to a beach in
Laguna, Marquez borrowed Justine to buy her some clothes, milk and food. Merano agreed because
it was usual for Marquez to bring Justine some things whenever Marquez came to the parlor. When
Marquez failed to return Justine in the afternoon as promised, Merano went to her employers’ house
to ask them for Marquez’s address. However, Merano said that her employers just assured her that
Justine will be returned to her soon. Merano searched for her daughter but her efforts were
unsuccessful until she received a call from Marquez on November 11, 1998. During that call, Marquez
told Merano that she will return Justine to Merano the following day, and asked Merano for
P50,000.00 for the expenses that she incurred while Justine was with her. Marquez did not return
Justine the following day. Hence, Merano sought the help of then Mayor Alfredo Lim. Mayor Lim
referred her to Inspector Eleazar of San Pedro, Laguna.
On February 11, 1999, Marquez called Merano up again to tell her to pick up her daughter at
Modesto Castillo’s (Castillo) house in Tiaong, Quezon. Accompanied by police officers, Merano went
to Castillo’s house. Castillo informed Merano that Marquez sold Justine to him and his wife for
P60,000.00. Castillo even gave Merano a photocopy of the handwritten “Kasunduan” wherein Merano
purportedly gave Justine to the Castillo spouses. Merano then learned from Castillo that in an effort
to legalize the adoption of Justine, the Castillos turned over custody of Justine to the Reception and
Study Center for Children of the Department of Social Welfare and Development. Hence, Marquez
was charged with kidnapping and failure to return a minor pursuant to Article 270 of the Revised
Penal Code (RPC). The trial court found Marquez guilty beyond reasonable doubt of the crime
charged. On appeal, the appellate court affirmed the conviction of Marquez. Hence, this appeal.
ISSUE:
Whether or not Marquez is guilty of kidnapping and failure to return a minor under Art. 270
of the RPC.
RULING:
YES. The crime has two essential elements: (1) The offender is entrusted with the custody of
a minor person; and (2) The offender deliberately fails to restore the said minor to his parents or
guardians. The Court, in elucidating on the elements of Article 270, stated that while one of the
essential elements of this crime is that the offender was entrusted with the custody of the minor,
what is actually being punished is not the kidnapping but the deliberate failure of that person to
restore the minor to his parents or guardians.
It is clear from the records of the case that Marquez was entrusted with the custody of Justine.
Whether this is due to Merano’s version of Marquez borrowing Justine for the day, or due to
Marquez’s version that Merano left Justine at her house, it is undeniable that in both versions,
Marquez agreed to the arrangement, i.e., to temporarily take custody of Justine. It does not matter,
for the first element to be present, how long said custody lasted as it cannot be denied that Marquez
was the one entrusted with the custody of the minor Justine. Thus, the first element of the crime is
satisfied. As to the second element, neither party disputes that on September 6, 1998, the custody of
Justine was transferred or entrusted to Marquez. Whether this lasted for months or only for a couple
of days, the fact remains that Marquez had, at one point in time, physical and actual custody of Justine.
Marquez’s deliberate failure to return Justine, a minor at that time, when demanded to do so by the
latter’s mother, shows that the second element is likewise undoubtedly present in this case.
PEOPLE OF THE PHILIPPINES v. JOEL BALUYA y NOTARTE

G.R. NO. 181822, 13 April 2011, SECOND DIVISION, (Peralta, J.)
Leaving a child in a place from which he did not know the way home, even if he had the freedom
to roam around the place of detention, would still amount to deprivation of liberty. For under such a
situation, the child’s freedom remains at the mercy and control of the abductor.
Glodil Castillon, who at that time was nine years old, was playing in front of their house
located along Laon Laan St., Sampaloc, Manila. While in the midst of play, he saw herein Joel Baluya.
Baluya then called Glodil's attention and summoned him to come forth. Immediately thereafter,
Baluya seized him by twisting his right arm, pointed a knife at him and told him that if Baluya’s wife,
Marissa, would not show up Glodil's mother would not see him anymore. Baluya and Glodil then
boarded a jeepney and went to Novaliches. It was Glodil's first time to reach Novaliches. Glodil
played, ate and slept with Baluya's children until the afternoon of the same day. During that period,
Baluya returned from time to time to check on them and bring them food. At 3:30 p.m. of the same
day, Baluya again called up Gloria and, while shouting, asked if his wife was already there. He then
threatened Gloria by saying that kapag hindi mo ipakita saakin si Marissa, hindi mo na makikita ang
anak mo. Subsequently, Gloria was able to talk to Marissa and convince her to meet with Baluya at
the Novaliches public market. Unknown to Baluya, the police already had a plan to arrest him, which
they did when he showed up to meet with his wife. In the meantime, around 4:00 p.m. of August 31,
2003, Glodil was able to seize an opportunity to escape while Baluya was away. He walked from the
place where Baluya left him in Novaliches until he reached their house and it took him around four
hours to do so. He was able to trace back their house by reading the signboard of the jeepneys and
following the route of those that pass by his place of residence.
Baluya in his defense argued that the victim is free to go home if he wanted to because he was
not confined, detained or deprived of his liberty and that there is no evidence to show that Glodil
sustained any injury. Further, Baluya alleges that Glodil was not forcibly taken, but instead
voluntarily went with appellant to Novaliches.
ISSUE:
Whether or not Joel Baluya is guilty of kidnapping and serious illegal detention.
RULING:
YES. The elements of kidnapping and serious illegal detention under Article 267 of the
Revised Penal Code (RPC) are: (1)The offender is a private individual; (2) he/she kidnaps or detains
another or in any other manner deprives the latter of his liberty; (3) The act of detention or
kidnapping is illegal; and (4) in the commission of the offense, any of the following circumstances are
present: (a) the kidnapping or detention lasts for more than 3 days; or (b) it is committed by
simulating public authority; or (c) any serious physical injuries are inflicted upon the person
kidnapped or detained or threats to kill him are made; or (d) the person kidnapped or detained is a
minor, female, or a public officer.
The presence of the first element is not in issue as there is no dispute that Baluya is a private
individual. As to the second element of the crime, the deprivation required by Article 267 of the RPC
means not only the imprisonment of a person, but also the deprivation of his liberty in whatever form
and for whatever length of time. It involves a situation where the victim cannot go out of the place of
confinement or detention or is restricted or impeded in his liberty to move. If the victim is a child, it
also includes the intention of the accused to deprive the parents of the custody of the child. In the
present case, Glodil was in the control of Baluya as he was kept in a place strange and unfamiliar to
him. Because of his tender age and the fact that he did not know the way back home, he was then and
there deprived of his liberty. The intention to deprive Glodil's parents of his custody is also indicated
by Baluya's actual taking of the child without the permission or knowledge of his parents, of
subsequently calling up the victim’s mother to inform her that the child is in his custody and of
threatening her that she will no longer see her son if she failed to show his wife to him.
Baluya's arguments that the victim is free to go home if he wanted to because he was not
confined, detained or deprived of his liberty and that there is no evidence to show that Glodil
sustained any injury, cannot hold water. For kidnapping to exist, it is not necessary that the offender
kept the victim in an enclosure or treated him harshly. Where the victim in a kidnapping case is a
minor, it becomes even more irrelevant whether the offender forcibly restrained the victim. It
remains undisputed that it was his first time to reach Novaliches and that he did not know his way
home from the place where he was left. It just so happened that the victim had the presence of mind
that, when he saw an opportunity to escape, he ran away from the place where Baluya left him.
Moreover, he is intelligent enough to read the signboards of the passenger jeepneys he saw and
follow the route of the ones going to his place of residence.
PEOPLE OF THE PHILIPPINES v. JERRY JACALNE GUTIERREZ

For there to be kidnapping, it is enough that the victim is restrained from going home. If the
victim is a minor, the duration of his detention is immaterial.
Jerry Gutierrez (Guttierez) was charged with the Kidnapping and Serious Illegal Detention of
seven-year old Jomarie Rosales (Rosales). Rosales alleged that she was on her way home when
Gutierrez accosted her and forced her to go with him to his house where she was detained for about
an hour. After which Gutierrez finally released her and Rosales went home. It was only three days
later that Rosales was able to tell her mother about the incident. The Regional Trial Court (RTC) and
the Court of Appeals (CA) found Gutierrez guilty of the crime charged.
ISSUE:
Whether or not Gutierrez is guilty of the crime of Kidnapping with Illegal Detention.
RULING:
YES. Records show that the prosecution has established the elements of the crime. It is
undisputed that Gutierrez is a private individual. As to the second, third and fourth elements, we
agree with the trial court, as affirmed by the CA, that Rosales’ and Marissa’s testimonies adequately
showed that indeed, appellant kidnapped Rosales, a minor, and detained her for more or less an hour.
The essence of the crime of kidnapping is the actual deprivation of the victims liberty, coupled with
the intent of the accused to effect it. It includes not only the imprisonment of a person but also the
deprivation of his liberty in whatever form and for whatever length of time. It involves a situation
where the victim cannot go out of the place of confinement or detention, or is restricted or impeded
in his liberty to move.
In this case, Gutierrez dragged Rosales, a minor, to his house after the latter refused to go
with him. Upon reaching the house, he tied her hands. When Rosales pleaded that she be allowed to
go home, he refused. Although Rosales only stayed outside the house, it was inside the gate of a fenced
property which is high enough such that people outside could not see what happens inside. Moreover,
when Gutierrez tied the hands of Rosales, the formers intention to deprive Rosales of her liberty has
been clearly shown. For there to be kidnapping, it is enough that the victim is restrained from going
home. Because of her tender age, and because she did not know her way back home, she was then
and there deprived of her liberty. This is irrespective of the length of time that she stayed in such a
situation. It has been repeatedly held that if the victim is a minor, the duration of his detention is
immaterial. This notwithstanding the fact also that appellant, after more or less one hour, released
Rosales and instructed her on how she could go home.
Grave Threats
SANTIAGO PAERA v. PEOPLE OF THE PHILIPPINES

G.R. No. 181626, 30 MARCH 2011, SECOND DIVISION, (Carpio, J.)
Article 282 of the RPC holds liable for Grave Threats any person who shall threaten another with
the infliction upon the person x x x of the latter or his family of any wrong amounting to a crime.
As punong barangay of Mampas, Bacong, Negros Oriental, Santiago Paera (Paera) allocated
his constituents use of communal water coming from a communal tank by limiting distribution to the
residents of Mampas, Bacong. The tank sits on a land located in the neighboring barangay of Mampas,
Valencia and owned by complainant Vicente Darong (Vicente), father of complainant Indalecio
Darong (Indalecio). Despite Paera’s scheme, Indalecio continued drawing water from the tank. Paera
reminded Indalecio of the water distribution scheme and cut Indalecio’s access. The following day,
Paera inspected the tank after constituents complained of water supply interruption. Paera
discovered a tap from the main line which he promptly disconnected. To stem the flow of water from
the ensuing leak, Paera, using a borrowed bolo, fashioned a wooden plug. It was at this point when
Indalecio arrived. What happened next is contested by the parties. According to the prosecution,
Paera, without any warning, picked-up his bolo and charged towards Indalecio, shouting Patyon
tikaw! (I will kill you). Paera claims, however, it was Indalecio who threatened him with a bolo,
angrily inquiring why Paera had severed his water connection. This left Paera with no choice but to
take a defensive stance using the borrowed bolo, prompting Indalecio to scamper. Municipal Circuit
Trial Court (MCTC) found Paera guilty as charged. Upon appeal to the Regional Trial Court (RTC)
affirmed MCTC Decision.
ISSUE:
Whether or not Paera is guilty of three counts of Grave Threats
RULING:
YES. Article 282 of the RPC holds liable for Grave Threats any person who shall threaten
another with the infliction upon the person x x x of the latter or his family of any wrong amounting
to a crime. This felony is consummated as soon as the threats come to the knowledge of the person
threatened. Applying these parameters, it is clear that Paera’s threat to kill Indalecio and Diosetea
and crack open Vicente’s skull are wrongs on the person amounting to (at the very least) homicide
and serious physical injuries as penalized under the Revised Penal Code. These threats were
consummated as soon as Indalecio, Diosetea, and Vicente heard Paera utter his threatening remarks.
Having spoken the threats at different points in time to these three individuals, albeit in rapid
succession, Paera incurred three separate criminal liabilities.
CRIMES AGAINST PROPERTY
Robbery with HOMICIDE
PEOPLE OF THE PHILIPPINES v. NGANO SUGAN, NGA BEN LATAM, FRANCING, GAGA LATAM,
SALIGO KUYAN and KAMISON AKOY
G.R. No. 192789, 23 MARCH 2011, THIRD DIVISION (Brion, J.)
There is no crime of robbery with homicide committed by a band. If robbery with homicide is
committed by a band, the indictable offense would still be denominated as robbery with homicide.
Gaga Latam, Saligo Kuyan, Ngano Sugan (Ngano), Nga Ben Latam and one alias Francing, all
armed with guns, entered Fortunato Delos Reyes’ (Fortunato) residence and declared a hold up.
Kamison Akoy (Kamison) and Cosme Latam (Cosme) stayed outside and acted as lookouts. Once
inside, the armed men ordered Fortunato, his wife Thelma, and their son Nestor, to drop to the floor.
The armed men inquired from them where the money and other valuables were hidden; thereafter,
they took cash, personal belongings, and an air gun. Ngano then brought Nestor outside the house
and shot him. Nestor’s brother Reggie ran to his parents’ house when he heard the gunshot. When he
arrived, Kamison and Cosme pointed a knife and a gun at him, respectively, and told him not to enter
the house. Reggie then heard Nestor shout that he had been hit. Thereafter, all the seven-armed men
left. Reggie rushed Nestor to the hospital, but the latter died due to multiple gunshot wounds.
The prosecution charged all seven men with the special complex crime of robbery with
homicide. Ngano, Nga Ben, and alias Francing are at large, while Cosme died in detention. The
Regional Trial Court (RTC) convicted Gaga, Saligo, and Kamison of of robbery with homicide
committed by a band. The Court of Appeals (CA) affirmed the decision.
ISSUE:
Whether or not Gaga, Saligo, and Kamison are guilty of the special complex crime of robbery
with homicide by a band.
RULING:
NO. There is robbery with homicide when a homicide is committed either by reason, or on
occasion, of the robbery. To sustain a conviction for robbery with homicide, the prosecution must
prove the following elements: (1) the taking of personal property belonging to another; (2) with
intent to gain; (3) with the use of violence or intimidation against a person; and (4) on the occasion
or by reason of the robbery, the crime of homicide, as used in its generic sense, was committed. A
conviction requires certitude that the robbery is the main purpose and objective of the malefactor,
and the killing is merely incidental to the robbery. The intent to rob must precede the taking of human
life but the killing may occur before, during or after the robbery.
In the present case, no doubt exists, based on Gaga, Saligo, and Kamison’s and their
companions’ actions that their overriding intention was to rob Fortunato’s house. The following facts
are established and undisputed: the armed men entered Fortunato’s house and ordered its occupants
to drop to the ground; they asked for the location of the money and other valuables; they took cash,
personal belongings, and an air gun. While it was undisputed that only Ngano shot Nestor, the lower
courts correctly found Gaga, Saligo, and Kamison liable for robbery with homicide. Case law
establishes that whenever homicide has been committed by reason of or on the occasion of the
robbery, all those who took part as principals in the robbery will also be held guilty as principals of
robbery with homicide although they did not take part in the homicide, unless it appears that they
sought to prevent the killing.
We, however, point out that the lower courts found Gaga, Saligo, and Kamison guilty of
robbery with homicide committed by a band. This is an erroneous denomination of the crime
committed, as there is no crime of robbery with homicide committed by a band. If robbery with
homicide is committed by a band, the indictable offense would still be denominated as robbery with
homicide under Article 294(1) of the Revised Penal Code. The element of band would be appreciated
as an ordinary aggravating circumstance.
Qualified Theft
PEOPLE OF THE PHILIPPINES v. BERNARD MIRTO

G.R. 193479, 19 October 2011, THIRD DIVISION (Velasco, Jr., J.)
Elements of Qualified Theft are: a) taking of personal property; b) said property belongs to
another; c) taking done with intent to gain; d) done without the owner’s consent; e) accomplished
without the use of violence or intimidation against persons, nor of force upon things; and f) done with
grave abuse of confidence.
In this case, there were seven information for Qualified Theft filed against Bernard Mirto
(Mirto) for stealing and depositing to his personal account the proceeds of bags cement paid to him.
It was alleged that Mirto was a branch manager of Union Cement Corporation (UCC). Mirto confided
to Restituto Renolo (Renolo) that he had misappropriated company funds. Renolo advised him to
explain his misdeeds to Assistant Vice President and Head of UCC-North Luzon Reynaldo Santos (AVP
Santos). Renolo faxed the letter of Mirto to AVP Santos. The latter instructed an audit team to conduct
a special audit. The team found that UCC cement bags were sold directly to buyers with credit line
and that as payment, buyers issued “Pay to Cash” checks as instructed by Mirto. UCC claimed that
Mirto gravely abused the trust and confidence reposed on him as Branch Manager and violated
company policies. Specifically, he used the credit line of accredited dealers in favor of those who had
no credit line. He instructed customers that payments be made in the form of “Pay to Cash”. He did
not remit the checks but these were either encashed or deposited in his personal account. Mirto
pleaded not guilty.
The Regional Trial Court (RTC) acquitted Mirto in three charges but found him guilty of
committing Qualified Theft in four charges. The RTC relied on the admission of Mirto. It ruled that
Mirto was never authorized by UCC to retain and deposit checks. On appeal, Court of Appeals (CA)
affirmed the conviction of Mirto ruling that Mirto had no right to possess the checks and was obliged
to turn over to UCC the payments he received.
ISSUE:
Whether or not Mirto is guilty of qualified theft
RULING:
YES. In the case at bar, all the elements of Qualified Theft are present in the case. The first and
second elements are abundantly clear. There can be no doubt that the money collected through check
payments are personal properties belong to UCC. The collected amount belongs to UCC. When Mirto
received it, he is obliged to turn over to UCC for he had no right to retain it. The third element is also
present. The intent to gain is amply established through affidavit of UCC’s customer that she was
instructed to make payment in form of check that is payable to cash. Upon receipt, Mirto deposited it
to his bank account. Equally clear is the presence of the fifth element, there being no violence or
intimidation in the taking. Lastly, grave abuse of confidence is clear from the nature of his position.
Mirto was a credit and collection officer of UCC. His position entailed a high degree of confidence,
having access to funds collected from UCC clients. By using the trust and confidence reposed in him,
Mirto was able to perpetrate the theft of UCC funds to the grave prejudice of the latter.
Estafa
LYZAH SY FRANCO v. PEOPLE OF THE PHILIPPINES

STEVE BESARIO v. PEOPLE OF THE PHILIPPINES
G.R. No. 171328/ G.R. No. 171335, 16 February 2011, FIRST DIVISION (Del Castillo, J.)
The elements of the crime of estafa under the foregoing provision are: (1) there must be a false
pretense, fraudulent acts or fraudulent means; (2) such false pretense, fraudulent act or fraudulent
means must be made or executed prior to or simultaneously with the commission of the fraud; (3) the
offended party must have relied on the false pretense, fraudulent act or fraudulent means and was thus
induced to part with his money or property; and (4) as a result thereof, the offended party suffered
damage.
Lyzah Sy Franco (Franco) assisted Lourdes in buying a 2nd hand car and introduced herself as
Assistant Administrative Coordinator of Final Access Marketing which was engaged in the sale and
financing of second-hand and repossessed vehicles. Franco and Lourdes went to a showroom on
Houston Street, San Juan, Metro Manila, where Lourdes immediately chose a blue Mazda 323 car from
those that were on display. Franco went to the house of Lourdes and presented a sales proposal, she
was with Besario and Rule, whom she introduced as her superiors. Rule then made a presentation on
the Mazda 323 car informing Lourdes that she can buy it for P130,000.00 with a downpayment of
P80,000.00 and the balance to be paid in 12 equal monthly installments. Rule also told Lourdes that
the car would be delivered within three days from receipt of her money. Lourdes agreed to pay the
downpayment the following day. The car, however, was not delivered as promised. Meanwhile,
Lourdes and her husband returned to the showroom on Houston Street, San Juan, where they saw
the Mazda car already clean. The security guard told them it was ready for release in the afternoon.
When the car was still undelivered, Lourdes sought the aid of Hoy Gising, a television show that
broadcasts grievances of people against fraudulent schemes. During a visit to the shows office,
Lourdes learned that 12 other persons were victimized by the group of Franco.
ISSUE:
Whether or not Franco is guilty of Estafa.
RULING:
YES. Petitioners presented themselves to Lourdes as persons possessing the authority and
capacity to engage in the financing of used vehicles in behalf of Final Access Marketing. This was a
clear misrepresentation considering their previous knowledge not only of Erlindas complaint but
also of several others as regards the failure of Final Access Marketing to deliver the motor vehicles
bought. Lourdes relied on their misrepresentations and parted with her money. Almost a week
passed by, but petitioners and Rule did not deliver the said motor vehicle. They also did not fulfill
their subsequent promise to provide a replacement or to refund her payment. When Lourdes visited
the office of Final Access Marketing to demand the return of her money, it was already closed. She
could not locate any of them except for Franco who denied any wrongdoing. Consequently, she
suffered damage.
The manner in which petitioners transacted business with Erlinda and Lourdes as well as
their awareness of 12 other similar complaints with Hoy Gising were sufficient to establish the
existence of a modus operandi. Franco’s attempt to escape culpability by feigning ignorance of the
previously failed transactions on the delivery of vehicles by Final Access Marketing cannot be
countenanced. As gleaned from the testimony of Erlinda, Franco was already with Final Access
Marketing at the time these transactions occurred. She was therefore familiar with the companys
procedure and policy on the sales of second-hand vehicles. She even accompanied Lourdes to
showrooms and introduced her to Besario and Rule. As an employee of Final Access Marketing,
Franco was expected to be familiar with its daily activities. It would be unworthy of belief that she
did not know of the complaints for the unexplained failure of Final Access Marketing to deliver
vehicles to its customers.
PEOPLE OF THE PHILIPPINES v. VIRGINIA BABY MONTANER

The elements of estafa under paragraph 2(d), Article 315 of the Revised Penal Code are: (1) the
postdating or issuance of a check in payment of an obligation contracted at the time the check was
issued; (2) lack of sufficiency of funds to cover the check; and (3) damage to the payee.
Virginia Baby Montaner (Montaner) is charged with the crime of estafa in which the
prosecution was able to present and prove the evidence that in exchange for cash, the former
presented to her victim, Reynaldo Solis, various post-dated checks. Montaner promised that the
checks she issued were fully funded. It proved otherwise when Solis tried to encash them in
Prudential Bank which established that the date of presentation of checks to Solis, the account was
already closed. Despite several demand letters, Montaner was unable to comply with her obligation
of paying back the loan to Solis. The defense, on the other hand, presented that the checks she issued
were borrowed from her by Marlyn Galope since the latter was in dire need of money. She gave the
ten checks to Galope, signed the same albeit the space for the date, amount and payee were left blank
so that the checks cannot be used for any negotiation. She further told Galope that the checks were
not funded. When she learned that a case was filed against her for estafa, she confronted Marlyn
Galope and the latter told her that money will not be given to her if she will not issue the said checks.
The Regional Trial Court (RTC) found Montaner guilty of estafa and was likewise affirmed by the
Court of Appeals (CA).
ISSUE:
Whether or not Montaner is guilty of estafa.
RULING:
YES. The elements of estafa under paragraph 2(d), Article 315 of the Revised Penal Code are:
(1) the postdating or issuance of a check in payment of an obligation contracted at the time the check
was issued; (2) lack of sufficiency of funds to cover the check; and (3) damage to the payee.
From the circumstances narrated above, it was evident that Solis would not have
given P50,000.00 cash to appellant had it not been for her issuance of the 10 Prudential Bank
checks. These postdated checks were undoubtedly issued by appellant to induce Solis to part with
his cash. However, when Solis attempted to encash them, they were all dishonored by the bank
because the account was already closed.
Attempted Estafa
ELVIRA LATEO Y ELEAZAR, FRANCISCO ELCA Y ARCAS, AND BARTOLOME BALDEMOR Y

MADRIGAL v. PEOPLE OF THE PHILIPPINES
Attempted estafa is committed when the accused commenced the commission of the crime of
estafa but they failed to perform all the acts of execution which would produce the crime, not by reason
of their own spontaneous desistance but because of their apprehension by the authorities before they
could obtain the amount (ie. there is only the intent to cause damage and not the damage itself).
The Prosecution alleged that Elvira Lateo (Lateo) and Francisco Elca (Elca) financed the
titling of the 122 hectares of land in Muntinlupa allegedly owned by Elca. The title to the property
had not transferred to Elca’s name due to a discrepancy between the Deed of Sale and the Transfer
Certificate Title (TCT). Elca offered to assign to Eleonor Lucero (Lucero) 70 hectares of said land. She
was then introduced to Bartolome Baldemor (Baldemor), Oscar Lalota (Lalota), and Nolasco de
Guzman (de Guzman). Lucero then released a sum of money to Elca, Lateo and Baldemor. Elca told
Lucero that certain portions of the property will first be put in Lateo’s name and would later be
assigned to her. However, upon verification with the Register of Deeds, Lucero discovered that the
titles of the property were actually registered in the names of another. Lucero then demanded the
return of the money. As they have no money to return, they instead offered a 5-hecatre property in
Bacoor, Cavite, allegedly owned by Elca and demanded an additional sum of money for the transfer
of the title. When Lucero verified with the Land Management Bureau (LMB), she discovered that Elca
only had a pending application for the sales patent over a 4-hectare area of the land, prompting her
to file a complaint.
The Defense alleged that Lucero, Lateo, and Lalota called a meeting regarding the proposal of
Lucero to finance the titling of Elca’s land. She proposed that 22 out of 122 hectares of the land would
be given to the old tenants of the property, the 30 hectares would be titled in Elca’s name and the
other 70 hectares would be her profit as financier. Lucero told Elca that upon verification from the
Register of Deeds, she found that all the documents submitted by Lalota necessary for titling were
falsified. Lalota then disappeared with the money. Lucero offered to buy Elca’s land in Bacoor and
she informed her that the land was not yet titled and Lucero agreed to pay in advance. However,
Lucero gave no advance payment. The Regional Trial Court (RTC) convicted Elca, Lateo, and
Baldemor of the crime of attempted estafa, as charged. The same was affirmed by the Court of Appeals
(CA).
ISSUE:
Whether or not Elca, Lateo and Baldemor are guilty of attempted estafa.
RULING:
YES. In this case, the transaction involving the Bacoor property was a continuation of the
transaction involving parcels of land in Muntinlupa. When Lucero discovered that Elca’s certificates
of title over the Muntinlupa property were fake, Elca offered, as substitute, the 5-hectare portion of
his purported 14-hectare lot in Bacoor but asked for an additional sum of money. As it turned out,
Elca did not own 14 hectares in Bacoor. He merely had an inchoate right over the Bacoor property.
Elca’s application was later amended to cover only 4 hectares. Clearly, Elca was in no position to
transfer ownership of the 5-hectare Bacoor property at the time they offered it to Lucero. Likewise,
their parody that Elca owned 14 hectares in Bacoor, Cavite, and was offering a 5-hectare portion of
it, in substitution of the Muntinlupa property, and demanding a sum of money from Lucero,
constituted fraud and deceit.
They commenced the commission of the crime of estafa but they failed to perform all the acts
of execution which would produce the crime, not by reason of their own spontaneous desistance but
because of their apprehension by the authorities before they could obtain the amount. Since only the
intent to cause damage and not the damage itself had been shown, the RTC and the CA correctly
convicted them of attempted estafa.
Malicious Mischief
ROBERT TAGUINOD v. PEOPLE OF THE PHILIPPINES

Under Article 327 of the Revised Penal Code, the elements of crime of malicious mischief are: a)
that the offender deliberately caused damage to the property of another; b) such act does not constitute
arson or other crimes involving destruction; and c) act of damaging another’s property be committed
merely for the sake of damaging it.
Pedro Ang (Ang) was driving his CRV from the 3rd basement parking while Robert Taguinod
(Taguinod) was driving his Vitara from the 2nd basement parking. When they were about to queue at
the corner to pay the parking fees, the vehicles were edging each other. The CRV was ahead of the
queue, but the Vitara tried to overtake which resulted to the touching of their side mirrors. Ang’s wife
and daughter alighted from CRV and confronted Taguinod, the latter appeared to be hostile, so Ang
told his wife and daughter to go back to the CRV. While they were returning, Taguinod accelerated
the Vitara and moved backward as if to hit them. Ang was able to pay the parking fee ahead of
Taguinod. When CRV was at the upward ramp leading to the exit, Vitara bumped the CRV’s rear
portion and pushed CRV until it hit the stainless steel railing located at the exit portion of the ramp.
CRV sustained damage at the back bumper spare tires and the front bumper. Thereafter, an
information against Taguinod for Malicious Mischief was filed. The Metropolitan Trial Court (MeTC)
found Taguinod guilty. On appeal, the Regional Trial Court (RTC) affirmed the conviction. The Court
of Appeals (CA) partially granted the petition for review by modifying the award of damages.
ISSUE:
Whether or not the conviction of Taguinod for the crime of Malicious Mischief should be
sustained
RULING:
YES. The Court finds that the prosecution has proven its case against Taguinod. Under Article
327 of the Revised Penal Code, the elements of crime of malicious mischief are: a) that the offender
deliberately caused damage to the property of another; b) such act does not constitute arson or other
crimes involving destruction; and c) act of damaging another’s property be committed merely for the
sake of damaging it.
In the case at bar, the hitting of the back portion of the CRV by Taguinod was clearly deliberate
as indicated by the evidence on record. The version of Ang that Taguinod chased him and that the
Vitara pushed Vitara until it reached the stairway railing was more believable than that Taguinod’s
version that it was Ang who moved backward and deliberately hit the Vitara. The act of damaging the
rear bumper of the CRV does not constitute arson or other crimes involving destruction. When the
Vitara bumped the CRV, Taguinod was just giving vent to his anger and hate as result of a heated
encounter between him and And. Therefore, the evidence on record shows that prosecution had
proved the guilt of Taguinod beyond reasonable doubt.
ILLEGAL MARRIAGES
Bigamy
CENON TEVES v. PEOPLE OF THE PHILIPPINES

A judicial declaration of nullity is required before a valid subsequent marriage can be

contracted; or else, what transpires is a bigamous marriage, reprehensible and immoral and is
punishable under the Revised Penal Code.
Cenon Teves (Cenon) is accused of the crime of bigamy when he contracted a marriage with
Thelma Teves. (Thelma) Subsequently after their marriage, Thelma left the country for work. It was
during her sojourn abroad that she was able to learn that Cenon was married to another woman. Not
believing what she has learned, she confirmed with the National Statistics Office (NSO) and obtained
a copy of the certificate of marriage between the two on Meycauayan, Bulacan. During the pendency
of the bigamy case in the lower court, the Regional Trial Court (RTC) declared the nullity of marriage
between Cenon and Thelma on the basis of physical incapability to fulfill essential marital obligations.
The said decision became final. The RTC convicted the charges of bigamy against Cenon but the latter
appealed stating that since his marriage has now been finally been declared null and void, the charges
of bigamy must not prosper since it retroacts to the very date of marriage, the law treating it as non-
existent. The Court of Appeals (CA) however disregarded his defense and affirmed in toto the
conviction of the RTC.
ISSUE:
Whether or not Cenon should be guilty of bigamy despite the declaration of nullity of
marriage.
RULING:
YES. A judicial declaration of nullity is required before a valid subsequent marriage can be
contracted; or else, what transpires is a bigamous marriage, reprehensible and immoral and is
punishable under the Revised Penal Code. To be liable for the crime of bigamy, it must be shown that
he executed a second marriage during the time that he was legally married and that it has not yet
been lawfully dissolved.
ATILANO O. NOLLORA, JR. v. PEOPLE OF THE PHILIPPINES

G.R. No. 191425, 7 September 2011, SECOND DIVISION (Carpio, J.)
In case of a marriage between a Muslim and a non-Muslim, solemnized not in accordance with
Muslim law or this Code, the Family Code of the Philippines, or Executive Order No. 209, shall apply.
Regardless of his professed religion, Nollora cannot claim exemption from liability for the crime of
bigamy.
Jesusa Pinat Nollora (Jesusa) and Atilano O. Nollora, Jr. (Nollora) got married on April 6, 1999.
Jesusa heard rumors that her husband has another wife and because of anxiety and emotional stress,
she left Saudi Arabia and returned to the Philippines. Upon arrival in the Philippines, Jesusa learned
that indeed, Atilano O. Nollora, Jr. contracted a second marriage with Rowena P. Geraldino (Rowena)
on December 8, 2001. Upon learning this information, Jesusa confronted Rowena at the latter’s
workplace and asked her if she knew of the first marriage between her and Nollora, to which Rowena
allegedly affirmed and despite this knowledge, she allegedly still married Nollora.
Nollora admitted having contracted two (2) marriages, the first with Jesusa and the second
with Rowena. He, however, claimed that he was a Muslim convert way back on January 10, 1992,
even before he contracted the first marriage with Jesusa. As a Muslim convert, he is allegedly entitled
to marry four (4) wives as allowed under the Muslim or Islam belief. He claimed that Jesusa knew
that he was a Muslim convert prior to their marriage because he told this fact when he was courting
her in Saudi Arabia and the reason why Jesusa filed the instant case was due to hatred having learned
of his second marriage with Rowena. He explained that in his Marriage Contract with Jesusa Pinat, it
is indicated that he was a Catholic Pentecostal but that he was not aware why it was placed as such
on said contract. In his Marriage Contract with Rowena P. Geraldino, the religion Catholic was also
indicated because he was keeping as a secret his being a Muslim since the society does not approve
of marrying a Muslim.
Rowena alleged that she was only a victim in this incident of bigamous marriage. She claimed
that she does not know Jesusa and only came to know her when this case was filed. The trial court
convicted Nollora and acquitted Rowena. Nollora appealed but the appellate court dismissed
Nollora’s appeal and affirmed the trial court’s decision. The appellate court likewise denied Nollora’s
motion for reconsideration.
ISSUE:
Whether Nollora is guilty beyond reasonable doubt of the crime of bigamy.
RULING:
YES. The circumstances in the present case satisfy all the elements of bigamy. (1) Nollora is
legally married to Pinat; (2) Nollora and Pinats marriage has not been legally dissolved prior to the
date of the second marriage; (3) Nollora admitted the existence of his second marriage to Geraldino;
and (4) Nollora and Geraldinos marriage has all the essential requisites for validity except for the
lack of capacity of Nollora due to his prior marriage. Before the trial and appellate courts, Nollora put
up his Muslim religion as his sole defense. He alleged that his religion allows him to marry more than
once. Granting arguendo that Nollora is indeed of Muslim faith at the time of celebration of both
marriages, Nollora cannot deny that both marriage ceremonies were not conducted in accordance
with the Code of Muslim Personal Laws, or Presidential Decree No. 1083. Indeed, Article 13(2) of the
Code of Muslim Personal Laws states that in case of a marriage between a Muslim and a non-Muslim,
solemnized not in accordance with Muslim law or this Code, the [Family Code of the Philippines, or
Executive Order No. 209, in lieu of the Civil Code of the Philippines] shall apply. Nolloras religious
affiliation is not an issue here. Neither is the claim that Nolloras marriages were solemnized
according to Muslim law. Thus, regardless of his professed religion, Nollora cannot claim exemption
from liability for the crime of bigamy.
Nollora asserted in his marriage certificate with Geraldino that his civil status is single.
Moreover, both of Nollora’s marriage contracts do not state that he is a Muslim. Although the truth
or falsehood of the declaration of one’s religion in the marriage certificate is not an essential
requirement for marriage, such omissions are sufficient proofs of Nollora’s liability for bigamy.
CRIMES AGAINST HONOR
Libel
DIONISIO LOPEZ y ABERASTURI v. PEOPLE OF THE PHILIPPINES

G.R. No. 172203, 14 FEBRUARY 2011, FIRST DIVISION (Del Castillo, J.)
To determine whether a statement is defamatory, the words used are to be construed in their
entirety and should be taken in their plain, natural and ordinary meaning as they would naturally be
understood by persons reading them, unless it appears that they were used and understood in another
sense.
In the early part of November 2002, while exercising his official duties as Mayor of Cadiz City,
Salvador Escalante (Escalante) saw billboards with the printed phrase CADIZ FOREVER with a blank
space before the word NEVER directly under said phrase. He became intrigued and wondered on
what the message conveyed since it was incomplete. Some days later, Escalante received a phone call
relating that the blank space preceding the word NEVER was filled up with the added words BADING
AND SAGAY. The next day, he saw the billboards with the phrase CADIZ FOREVER BADING AND
SAGAY NEVER printed in full.
Jude Martin Jaropillo (Jude) is a licensing officer of the Permit and License Division of Cadiz
City. While on a licensing campaign, he was able to read the message on the billboards. He wondered
what fault the person alluded therein has done as the message is so negative. He felt that the message
is an insult to the mayor since it creates a negative impression, as if he was being rejected by the
people of Cadiz City. He claimed that he was giving his testimony voluntarily and he was not being
rewarded, coerced or forced by anybody. Nenita Bermeo (Nenita), a retired government employee of
Cadiz City, was at Delilah’s Coffee [Shop] in the morning of November 19, 2002 when she heard the
Dionisio Lopez (Lopez) shouting Bading, Bading, Never, Never. She and the tricycle drivers drinking
coffee were told by Lopez, “You watch out I will add larger billboards.” When she went around Cadiz
City, she saw larger billboards with the phrase CADIZ FOREVER BADING AND SAGAY NEVER, thus
confirming what Lopez had said. With the message, she felt as if the people were trying to disown
Escalante. According to her, Lopez has an ax to grind against the mayor. Like Jude, she was not also
forced or rewarded in giving her testimony. Bernardita Villaceran (Bernardita) also found the
message unpleasant because Mayor Escalante is an honorable and dignified resident of Cadiz City.
According to her, the message is an insult not only to the person of the mayor but also to the people
of Cadiz City.
Escalante admitted having placed all the billboards because he is aware of all the things
happening around Cadiz City. He mentioned BADING because he was not in conformity with the many
things the mayor had done in Cadiz City. He insisted that he has no intention whatsoever of referring
to Bading as the Tuta of Sagay. He contended that it was private respondent who referred to Bading
as Tuta of Sagay. He further maintained that his personal belief and expression was that he will never
love Bading and Sagay. He concluded that the message in the billboards is just a wake-up call for Cadiz
City.
ISSUE:
Whether the printed phrase CADIZ FOREVER, BADING AND SAGAY NEVER is libelous
RULING:
NO. A libel is defined as a public and malicious imputation of a crime or of a vice or defect,
real or imaginary or any act, omission, condition, status or circumstance tending to cause the
dishonor, discredit or contempt of a natural or juridicial person or to blacken the memory of one who
is dead.
A charge is sufficient if the words are calculated to induce the hearers to suppose and
understand that the person or persons against whom they were uttered were guilty of certain
offenses or are sufficient to impeach the honesty, virtue or reputation or to hold the person or
persons up to public ridicule. Tested under these established standards, we cannot subscribe to the
appellate courts finding that the phrase CADIZ FOREVER, BADING AND SAGAY NEVER tends to
induce suspicion on private respondent’s character, integrity and reputation as mayor of Cadiz City.
There are no derogatory imputations of a crime, vice or defect or any act, omission, condition, status
or circumstance tending, directly or indirectly, to cause his dishonor. Neither does the phrase in its
entirety, employ any unpleasant language or somewhat harsh and uncalled for that would reflect on
private respondents’ integrity. Obviously, the controversial word NEVER used by petitioner was
plain and simple. In its ordinary sense, the word did not cast aspersion upon private respondent’s
integrity and reputation much less convey the idea that he was guilty of any offense. Simply worded
as it was with nary a notion of corruption and dishonesty in government service, it is our considered
view to appropriately consider it as mere epithet or personal reaction on private respondent’s
performance of official duty and not purposely designed to malign and besmirch his reputation and
dignity more so to deprive him of public confidence. Indeed, the prosecution witnesses were able to
read the message printed in the billboards and gave a negative impression on what it says.
As observed by the OSG, at the time the billboards were erected and during the incumbency
of private respondent as mayor of Cadiz City, these witnesses were either employed in the Cadiz City
Hall or active in the project of the city government. Bernardita was a member of the Clean and Green
Program of Cadiz City; Jude was employed as a licensing officer under the Permit and License Division
of the Cadiz City Hall and Nenita held the position of Utility Worker II of the General Services Office
of Cadiz City. These witnesses, according to the OSG, would naturally testify in his favor. They could
have verbicide the meaning of the word NEVER. Prudently, at the least, the prosecution could have
presented witnesses within the community with more independent disposition than these witnesses
who are beholden to private respondent.
ISAGANI M. YAMBOT, LETTY JIMENEZ-MAGSANOC, JOSE MA. D. NOLASCO, ARTEMIO T.

ENGRACIA, JR. and VOLT CONTRERAS v. Hon. ARTEMIO TUQUERO in his capacity as Secretary
of Justice, and ESCOLASTICO U. CRUZ, JR.
Like fair commentaries on matters of public interest, fair reports on the same should thus be
included under the protective mantle of privileged communications.
Volt Contreras (Contreras) wrote an article in the Philippine Daily Inquirer (PDI) that Makati
Regional Trial Court (RTC) Judge Escolastico Cruz, Jr. (Judge Cruz) mauled the trial court’s
administrative officer Robert Mendoza. Judge Cruz filed a libel case against Contreras for the latter’s
false and malicious article, which states: “According to Mendoza, Cruz still has a pending case of
sexual harassment filed with the Supreme Court (SC) by Fiscal Maria Lourdes Garcia.” While Judge
Cruz presses that no such suit was filed against him, Contreras contends that his news article
constituted a fair and true report of a matter of grave public interest as it involved the conduct of a
regional trial court judge.
The prosecutor issued a resolution finding probable cause and filed an Information for libel
against Contreras and five other PDI staff. Secretary of Justice Artermio Tuquero dismissed PDI’s
petition for review of the prosecutor’s resolution. The Court of Appeals (CA) likewise dismissed PDI’s
petition for certiorari.
ISSUE:
Whether or not the PDI staff are guilty of libel.
RULING:
NO. It can be easily discerned that the article merely reported the statement of Mendoza that
there was allegedly a pending case of sexual harassment against Judge Cruz and that said article did
not report the existence of the alleged sexual harassment suit as a confirmed fact. Judge Cruz never
alleged, much less proved, that Mendoza did not utter such statement. Nevertheless, Judge Cruz
concludes that there was malice on the part of the PDI Staff by asserting that they did not check the
facts. He claimed that the report got its facts wrong, pointing to a certification from the Deputy Court
Administrator attesting to the pendency of only two administrative cases against him, both of which
bear captions not mentioning sexual harassment.
The questioned portion of the news article, while unfortunately not quite accurate, on its own,
is insufficient to establish the element of malice in libel cases. We have held that malice connotes ill
will or spite and speaks not in response to duty but merely to injure the reputation of the person
defamed, and implies an intention to do ulterior and unjustifiable harm. Malice is present when it is
shown that the author of the libelous remarks made such remarks with knowledge that it was false
or with reckless disregard as to the truth or falsity thereof.
A newspaper especially one national in reach and coverage, should be free to report on events
and developments in which the public has a legitimate interest with minimum fear of being hauled
to court by one group or another on criminal or civil charges for libel, so long as the newspaper
respects and keeps within the standards of morality and civility prevailing within the general
community. Like fair commentaries on matters of public interest, fair reports on the same should
thus be included under the protective mantle of privileged communications, and should not be
subjected to microscopic examination to discover grounds of malice or falsity. The concept of
privileged communication is implicit in the constitutionally protected freedom of the press, which
would be threatened when criminal suits are unscrupulously leveled by persons wishing to silence
the media on account of unfounded claims of inaccuracies in news reports.
SPECIAL PENAL LAWS
R.A. No. 4103, Indeterminate Sentence Law
ROSANA ASIATICO y STA. MARIA v. PEOPLE OF THE PHILIPPINES

Sec. 1 of the Indeterminate Sentence Law mandates that, in case of a special law, the accused
shall be sentenced to an indeterminate sentence, the maximum term of which shall not exceed the
maximum fixed by said law and the minimum shall not be less than the minimum term prescribed by the
same.
Rosana Asiatico y Sta. Maria (Rosana) and her co-accused Aldrin Estrella y Sta. Maria (Aldrin)
were charged in two (2) separate Informations with violation of Sec. 11, Art. II of Republic Act No.
(RA) 9165 or the Comprehensive Dangerous Drugs Act of 2002 before the Regional Trial Court. Due
to an informant’s tip regarding an illegal drug trade involving Rosana and Aldrin, PO3 Victor Santos
formed a team to conduct a buy-bust operation. The team was composed of PO2 Jorge Gorgonia who
was assigned as team leader, and PO1 Sadjid Angara (PO1 Angara), PO1 Antonio Madlangbayan (PO1
Madlangbayan), PO1 Rommel Alfaro, PO1 Oscar Escudero and PO1 Pedro Sangada, as back-up. PO1
Angara was designated as poseur-buyer. The removal of PO1 Angara’s cap was the pre-arranged
signal to signify the consummation of the transaction.
Thereafter, the buy-bust team proceeded to the target area with the informant. The informant
introduced PO1 Angara as buyer of shabu to Rosana. PO1 Angara wanted to buy three hundred pesos
(P300) worth of shabu. After a few minutes, Aldrin arrived in the scene and showed them two (2)
plastic sachets containing three hundred pesos (P300) worth of shabu. All of a sudden, Aldrin decided
to back out then whispered to Rosana that there was something bulging on the waist of poseur-buyer.
PO1 Angara sensed that his disguise was discovered and he immediately performed the pre-arranged
signal by removing his cap. PO1 Madlangbayan immediately advanced to arrest Rosana and Aldrin.
PO1 Madlangbayan Rosana and recovered one (1) plastic sachet from her. PO1 Angara frisked Aldrin
and recovered two (2) plastic sachets from him. The officers informed the Rosana and Aldrin of their
constitutional rights. Thereafter, PO1 Madlangbayan separately wrapped the recovered plastic
sachets with newspapers and labeled them Joy and Ako, respectively.
The Regional Trial Court (RTC) found Rosana and Aldrin guilty beyond reasonable doubt of
the crime charged and sentenced each to suffer the penalty of imprisonment of twelve (12) years and
one (1) day and a fine of PhP 300,000.00. Only Rosana appealed. The Court of Appeals (CA) sustained
the judgment of conviction by the RTC, ruling that the prosecution sufficiently established the
elements of illegal possession of dangerous drugs, through the testimony of PO1 Angara; contrary to
Rosana’s contention that non-compliance with the procedure in Sec. 21 of R.A. 9165 ipso facto
invalidates the seizure.
ISSUE:
1. Whether Rosana’s conviction is proper despite the prosecution’s failure to establish the
chain of custody of the confiscated drugs.
2. Whether the penalty imposed is correct.
RULING:
1. YES. Rosana was found to have in her possession 0.05 gram of shabu. There was nothing in
the records showing that she had authority to possess it. Jurisprudence also teaches Us that mere
possession of a prohibited drug constitutes prima facie evidence of knowledge or animus possidendi
sufficient to convict an accused in the absence of any satisfactory explanation. Rosana also failed to
present contrary evidence to rebut her possession of the shabu. Moreover, the chain of custody of the
seized prohibited drugs was adequately established in the instant case. Admittedly, a testimony
about a perfect chain is not always the standard as it is almost always impossible to obtain an
unbroken chain. What is of utmost importance is the preservation of the integrity and the evidentiary
value of the seized items. Here, there was substantial compliance with the law and the integrity of
the drugs seized from Rosana was preserved.
2. NO. Sec. 11(3) of RA 9165 provides that illegal possession of less than five (5) grams of
shabu is penalized with imprisonment of twelve (12) years and one (1) day to twenty (20) years, and
a fine ranging from three hundred thousand pesos (PhP 300,000) to four hundred thousand pesos
(PhP 400,000). The imposed fine of PhP 300,000 is proper under the premises. As regards the
imprisonment sentence, the courts a quo erred in imposing a straight penalty of imprisonment of
twelve (12) years and one day. Sec. 1 of the Indeterminate Sentence Law mandates that, in case of a
special law, the accused shall be sentenced to an indeterminate sentence, the maximum term of which
shall not exceed the maximum fixed by said law and the minimum shall not be less than the minimum
term prescribed by the same. Thus, applying the ISL to the imposable penalties under Sec. 11(3) of
RA 9165, We find, under the circumstances, the penalty of imprisonment from twelve (12) years and
one (1) day, as minimum, to fourteen (14) years and eight (8) months, as maximum, to be proper.
P.D. No. 968, Probation Law
ARNEL COLINARES v. PEOPLE OF THE PHILIPPINES

G.R. No. 182748, 13 December 2011, EN BANC (Abad, J.)
Under the probation law, the accused who appeals from the judgment of conviction is
disqualified from availing himself of the benefits of probation.
Arnel Colinares (Arnel) was charged with frustrated homicide before the Regional Trial Court
(RTC). Rufino P. Buena (Rufino) testified that he and Jesus Paulite (Jesus) went out to buy cigarettes
at a nearby store. On their way, Jesus took a leak by the roadside with Rufino waiting nearby. From
nowhere, Arnel sneaked behind and struck Rufino twice on the head with a huge stone, about 15
inches in diameter. Rufino fell unconscious as Jesus fled. Rufino suffered two lacerated wounds on
the forehead, along the hairline area. The doctor testified that these injuries were serious and
potentially fatal but Rufino chose to go home after initial treatment. The RTC convicted Arnel with
frustrated homicide. On appeal, Arnel sought conviction for the lesser crime of attempted homicide
with the consequent reduction of the penalty imposed on him. The Court of Appeals (CA) affirmed
the RTC.
ISSUES:
1. Whether or not Arnel is guilty of frustrated homicide.

2. Given a finding that Arnel is entitled to conviction for a lower offense and a reduced
probationable penalty, whether or not he may still apply for probation on remand of the case
to the trial court.
RULING:
1. NO. The main element of attempted or frustrated homicide is the accused’s intent to take
his victim’s life. The prosecution has to prove this clearly and convincingly to exclude every possible
doubt regarding homicidal intent. And the intent to kill is often inferred from, among other things,
the means the offender used and the nature, location, and number of wounds he inflicted on his
victim. Here, Arnel struck Rufino on the head with a huge stone. The blow was so forceful that it
knocked Rufino out. Considering the great size of his weapon, the impact it produced, and the
location of the wounds that Arnel inflicted on his victim, the Court is convinced that he intended to
kill him. The Court is inclined, however, to hold Arnel guilty only of attempted, not frustrated,
homicide. If the victim’s wounds are not fatal, the crime is only attempted murder or attempted
homicide. Taken in its entirety, there is a dearth of medical evidence on record to support the
prosecution’s claim that Rufino would have died without timely medical intervention. Thus, the
Court finds Arnel liable only for attempted homicide and entitled to the mitigating circumstance of
voluntary surrender.
2. YES. Ordinarily, Arnel would no longer be entitled to apply for probation, he having
appealed from the judgment of the RTC convicting him for frustrated homicide. But, the Court finds
Arnel guilty only of the lesser crime of attempted homicide and holds that the maximum of the
penalty imposed on him should be lowered to imprisonment of four months of arresto mayor, as
minimum, to two years and four months of prision correccional, as maximum. With this new penalty,
it would be but fair to allow him the right to apply for probation upon remand of the case to the RTC.
It is true that under the probation law, the accused who appeals from the judgment of
conviction is disqualified from availing himself of the benefits of probation. But, as it happens, two
judgments of conviction have been meted out to Arnel: one, a conviction for frustrated homicide by
the RTC, now set aside; and, two, a conviction for attempted homicide by the Supreme Court. Here,
however, Arnel did not appeal from a judgment that would have allowed him to apply for probation.
He did not have a choice between appeal and probation. He was not in a position to say, “By taking
this appeal, I choose not to apply for probation.” The stiff penalty that the trial court imposed on him
denied him that choice. Thus, a ruling that would allow Arnel to now seek probation under this
Court’s greatly diminished penalty will not dilute the sound ruling in Francisco. It remains that those
who will appeal from judgments of conviction, when they have the option to try for probation, forfeit
their right to apply for that privilege. In a real sense, the Court’s finding that Arnel was guilty, not of
frustrated homicide, but only of attempted homicide, is an original conviction that for the first time
imposes on him a probationable penalty. Had the RTC done him right from the start, it would have
found him guilty of the correct offense and imposed on him the right penalty of two years and four
months maximum. This would have afforded Arnel the right to apply for probation.
R.A. No. 7610, Special Protection of Children Against Child Abuse, Exploitation and
Discrimination
JOJIT GARINGARAO v. PEOPLE OF THE PHILIPPINES

G.R. No. 192760, 20 July 2011, SECOND DIVISION (Carpio, J.)
In lascivious conduct under the coercion or influence of any adult, there must be some form of
compulsion equivalent to intimidation which subdues the free exercise of the offended party’s free will.
16-year old AAA was brought by her parents BBB and CCC to the Virgen Milagrosa Medical
Center due to fever and abdominal pain. While AAA was confined, BBB left the hospital to process
AAA’s Medicare papers while CCC also left to attend to their store. AAA was left alone in her room.
When BBB returned, AAA informed him that she wanted to go home. Despite the advice of the doctor
for her to remain in the hospital, AAA was adamant that she be allowed to leave. Upon reaching home,
AAA informed her parents that she was sexually abused by Jojit Garingarao (Garingarao), a nurse on
duty at the time she was left alone in the hospital.
The City Prosecutor filed an Information for Acts of Lasciviousness in relation to Republic Act
(RA) No. 7160. AAA testified that Garingarao went inside her room and feigning that he needed to
physically examine AAA, proceeded to touch her breasts and then slid his finger inside AAA’s private
parts despite AAA’s protests. Garingarao denied the allegations. Also, Garingarao claimed that the
filing of the case against him was made in retaliation because of a heated argument that occurred
between BBB and Garingarao over AAA’s medications. Both the Regional Trial Court (RTC) and the
Court of Appeals (CA) found Garingarao guilty. The CA, however, modified the decision stating that
although Garingarao was charged with Acts of Lasciviousness in relation to RA 7160, Garingarao
should be convicted only of violating RA 7160. Under Section 5(b) of RA 7610, the offender shall be
charged with rape or lascivious conduct under the Revised Penal Code (RPC) only if the victim is
below 12 years old; otherwise, the provisions of RA 7610 shall prevail.
ISSUE:
Whether or not Garingarao should be convicted of violating RA 7160.
RULING:
YES. In this case, the prosecution established that Garingarao touched AAA’s breasts and
inserted his finger into her private part for his sexual gratification. Garingarao used his influence as
a nurse by pretending that his actions were part of the physical examination he was doing. Garingarao
persisted on what he was doing despite AAAs objections. AAA twice asked Garingarao what he was
doing and he answered that he was just examining her.
The Court has ruled that a child is deemed subject to other sexual abuse when the child is the
victim of lascivious conduct under the coercion or influence of any adult. In lascivious conduct under
the coercion or influence of any adult, there must be some form of compulsion equivalent to
intimidation which subdues the free exercise of the offended party’s free will. The Court has already
ruled that it is inconsequential that sexual abuse under RA 7610 occurred only once. Section 3(b) of
RA 7610 provides that the abuse may be habitual or not. Hence, the fact that the offense occurred
only once is enough to hold Garingarao liable for acts of lasciviousness under RA 7610.
R.A. No. 3019, Anti-Graft and Corrupt Practices Act
VAN D. LUSPO v. PEOPLE OF THE PHILIPPINES

SUPT. ARTURO H. MONTANO and MARGARITA TUGAOEN v. PEOPLE OF THE PHILIPPINES
C/INSP. SALVADOR C. DURAN, SR., v. PEOPLE OF THE PHILIPPINES
G.R. No. 188487/ G.R. No. 188541/G.R. No. 188556, 14 February 2011,
SECOND DIVISION (Nachura, J.)
In Cabrera v. Sandiganbayan, the Court explained that there are two ways for a public official
to violate this provision in the performance of his functions, namely: (a) by causing undue injury to any
party, including the government; or (b) by giving any private party any unwarranted benefits,
advantage, or preference.
The Office of the Directorate for Comptrollership (ODC) issued two Advices of Sub-Allotment
(ASA), each amounting to 5 million pesos purportedly for the purchase of combat, clothing, and
individual equipment (CCIE) for the North Capital Command (CAPCOM). The ASAs where approved
FOR THE CHIEF PNP by Director Guillermo Domondon, Chief Director of ODC, and signed for him by
Police Superintendent Van Luspo (Luspo), Chief, Fiscal Division, Budget and Fiscal Services of the
ODC. The ASAs were issued without an approved personnel program from the Directorate for
Personnel.
Upon receipt of the ASAs, P/Supt. Arturo Montano (Montano), Chief Comptroller, North
CAPCOM, directed Police Chief Inspector Salvador Duran, Sr. (Duran), Chief, Regional Finance Service
Unit, North CAPCOM, to prepare and draw 100 checks of P100,000.00 each, for a total of
P10,000,000.00. The checks were all dated August 12, 1992 and payable respectively to DI-BEN
Trading, MT Enterprises, J-MOS Enterprises, and Triple 888 Enterprises, each to receive 25 checks.
All enterprises were owned and operated by Margarita Tugaoen (Tugaoen), who collected the
proceeds of the checks from the United Coconut Planters Bank (UCPB). Tugaoen did not deliver any
CCIE in exchange for the P10 million worth of checks, because the amount was allegedly intended as
payment for the previously accumulated debts of the PNP.
The non-delivery was confirmed by P/CInsp. Isaias Braga (Braga), Chief Logistics Officer,
North CAPCOM, and Rolando Flores, Supply Accountable Officer, North CAPCOM. Both declared that,
while they received CCIE in 1992, the same came from the PNP Logistics Command and not from
Tugaoen, and that the value of the items they received was just P5,900,778.80 and had no relation at
all to the P10 million CCIE purchase under investigation. Their statements were corroborated by
P/Supt. Jesus Arceo, Chief of the Supply Center of PNP Logistics Command.
ISSUE:
Whether or not Luspo, Montano, Tugaoen, Duran violated Section 3(e) of R.A. No. 3019
RULING:
YES as to Montano, Tugaoen and Duran, but not to Luspo. The Office of the Directorate for
Comptrollership assists the PNP Chief in determining how the PNP funds will be sub-allocated to the
regional commands and their support units. Any determination made would then be executed by the
Fiscal Services and Budget Division by issuing an ASA with Nazareno’s signature as the chief financial
director of the PNP, in favor of the appropriate command or support unit.
Section 26 of R.A. No. 6975 also empowers the PNP Chief to issue implementing policies for
the micromanagement of the entire force. In the exercise of such power, Nazareno issued a letter-
directive on March 20, 1992, entitled Delegation of Authority, wherein he delegated to his
subordinate officers several of his customary authority, ranging from the approval or disapproval of
projects to the signing of correspondence and working papers in his behalf. As testified to by defense
witness Dalut, DC referred to Director for Comptrollership, who, at that time, was Domondon.
Domondon thereafter sub-delegated such authority to his subordinates Luspo and Osia, through a
memorandum dated January 31, 1991. Relying on the memorandum, Luspo signed ASA Nos. 001-
500-138-92 SN 4361 and 001-500-139-92 SN 4362 on August 11, 1992, releasing P10 million from
the Personal Services Fund in favor of North CAPCOM for the purchase of CCIE.
Again, Luspo committed no prohibited act; neither did he violate any law, rule, or internal
order when he signed the ASAs. Logically, his signature in the ASAs cannot be considered as an overt
act in furtherance of one common design to defraud the government. Given the above premises, the
acquittal of Luspo is inevitable. Unfortunately, the immediately preceding disquisition does not apply
to Duran, Montano, and Tugaoen. After receiving the ASAs, Montano instructed Duran to prepare and
draw 100 checks for P100,000.00 each for four (4) payees, DI-BEN Trading, MT Enterprises, J-MOS
Enterprises, and Triple 888 Enterprises, the supposed suppliers of the CCIE. The checks were all
dated August 12, 1992 and signed by both Montano and Duran. Montano thereafter released them to
Tugaoen, the owner of the four enterprises, without the required liquidating and supporting
documents mandated by Section 4(6) of Presidential Decree (P.D.) No. 1445, which provides that
claims against government funds shall be supported by complete documentation. In the succeeding
days, Tugaoen encashed the checks with UCPB, without delivering in exchange a single piece of CCIE
for the uniformed personnel of North CAPCOM.
VIRGINIA M. GUADINES v. SANDIGANBAYAN AND PEOPLE OF THE PHILIPPINES

G.R. No. 164891, 6 June 2011, THIRD DIVISION (Villarama, Jr, J.)
The term undue injury in the context of Section 3 (e) of the Anti-Graft and Corrupt Practices Act
punishing the act of causing undue injury to any party, has a meaning akin to that civil law concept of
actual damage.
By virtue of a public bidding for the materials to be used in the construction of a Navotas
Bridge in Polilo, Quezon, a contract was awarded to V.M. Guadines Construction Supply owned by
Virginia Guadines (Guadines). A purchase order was issued by the Provincial Government of Quezon
for the construction materials, consisting of lumber, which were stockpiled along the road away from
the bridge, and received by Bernie Azaula (Azaula), Barangay Chairman and Member of the
Sangguniang Bayan. A team of Department of Environment and Natural Resources (DENR) officials
from the Community and Environment Resources (CENR) confiscated 73 pieces of lumber which
were stockpiled, pending submission of certain required documents. They were subsequently
marked as confiscated. Since Azaula volunteered to take custody as a public official of the community,
the CENR returned the seized lumber to him. The Sangguniang Bayan requested DENR to donate the
seized lumber instead so it can be used for the delayed construction of the bridge as they remain
stockpiled and abandoned by the owner. Azaula opposed the proposal, insisting that Guadines be
paid for said materials. Polilo Mayor Rosendo Escara (Mayor Escara) requested the Provincial
Engineer’s Office (PEO) to assist in the immediate construction. The Municipal Treasurer then issued
in inspection report stating that the materials delivered by V.M. Guadines and received in good
condition.
When the construction was finished, Azaula requested for the issuance of disbursement
voucher authorizing the provincial treasurer to pay V.M. Guadines, and Azaula received the payment
from the treasurer for the materials. CENR filed a memorandum stating that despite the warnings,
the confiscated lumbers were still used, and recommending for proper charges against Azaula as the
custodian thereof. The Provincial Auditor then conducted an investigation, and found that the
materials used in the bridge construction were the same ones confiscated by the CENR. Thus, there
was no need for the government to pay for the purchase price of the lumber, and ordered V.M.
Guadines to refund the amount paid by the government. Consequently, the Sangguniang Bayan
Member May Estuita filed a complaint against Guadines, Azaula, and Escara for violation of Section
3(e), Republic Act (RA) No. 3019. The Sandiganabayan convicted them as charged, finding Guadines
acted in conspiracy with Azaula and Escara in defrauding the provincial government under the
contract for purchase of construction materials.
ISSUE:
Whether or not Guadines acted in conspiracy with Azaula and Escara in violating Sec. 3(e),
RA No. 3019.
RULING:
YES. The Court explained the elements of the crime in Santos v. People: As may be noted, what
contextually is punishable is the act of causing any undue injury to any party, or the giving to any
private party of unwarranted benefits, advantage or preference in the discharge of the public officer’s
functions. The term undue injury in the context of Section 3 (e) of the Anti-Graft and Corrupt Practices
Act punishing the act of causing undue injury to any party, has a meaning akin to that civil law concept
of actual damage. The Court said so in Llorente vs. Sandiganbayan, thus: In jurisprudence, undue
injury is consistently interpreted as actual damage. Undue has been defined as more than necessary,
not proper, [or] illegal; and injury as any wrong or damage done to another, either in his person,
rights, reputation or property; that is, the invasion of any legally protected interest of another. Actual
damage, in the context of these definitions, is akin to that in civil law
By accepting payment for delivery of lumber found to be without supporting documents as

required by law, Guadines caused undue injury or damage to the provincial government which had
no obligation to pay for confiscated lumber considered as government property. In fact, it is only the
DENR Secretary or his representative who can dispose of such confiscated lumber in accordance with
forestry laws and regulations. The Sandiganbayan’s finding that it was Guadines’ lumber which were
later confiscated by CENR and used in the bridge construction, was satisfactorily established by the
prosecutions documentary and testimonial evidence. When the defendants by their acts aimed at the
same object, one performing one part, and the other performing another part so as to complete it,
with a view to the attainment of the same object, and their acts though apparently independent, were
in fact concerted and cooperative, indicating closeness of personal association, concerted action and
concurrence of sentiments, the court will be justified in concluding that said defendants were
engaged in a conspiracy.
In this case, the finding of conspiracy was well-supported by evidence, as Guadines’

participation and cooperation was indispensable in defrauding the government of the amount paid
for the said confiscated lumber. Without doubt, her acts in making delivery to Azaula instead of the
provincial government or PEO, evading apprehension for the illegally cut logs and yet pursuing
clearance for the release of the said products by appealing to the local sanggunian, and later accepting
payment with the assistance of Azaula and Escara - all clearly showed her complicity in the
anomalous disbursement of provincial government funds allocated for the bridge construction
project.
ELFREN L. ALVAREZ v. PEOPLE OF THE PHILIPPINES

G.R. No. 192591, 29 June 2011, FIRST DIVISION (Villarama, Jr., J.)
Under the second mode of the crime defined in Section 3(e) of RA No. 3019, damage is not
required. In order to be found guilty under the second mode, it suffices that the accused has given
unjustified favor or benefit to another, in the exercise of his official, administrative or judicial functions.
Elfren Alvarez (Alvarez) was the Mayor of the Municipality (now City) of Muñoz, Nueva Ecija,
at the time of the transaction. The Sangguniang Bayan of Munoz approved the adoption of the
construction project of a shopping mall under the Build-Operate-Transfer (BOT) arrangement with
Australian-Professional, Inc. (API), on a property of the municipal government, at the back of the
Municipal Hall. A Memorandum of Agreement (MOA) was then entered into between API and Alvarez.
The site was occupied by government structures which were demolished at the instance of Alvarez
to give way to the construction project. However, no mall was constructed as API stopped work
within just a few months. Alvarez then was charged before the Sandiganbayan for violation of Section
3(e) of Republic Act (RA) No. 3019. He contended that the municipal government did not spend any
amount for the shopping mall project and that it was an unsolicited proposal under the BOT law. The
Sandiganbayan convicted Alvarez as charged.
ISSUE:
Whether or not Alvarez violated Section 3(e) of RA No. 3019.
RULING:
YES. To be convicted under the said provision, the following elements must be established:
(1) the accused must be a public officer discharging administrative, judicial or official functions; (2)
he must have acted with manifest partiality, evident bad faith or inexcusable negligence; and (3) that
his action caused any undue injury to any party, including the government, or giving any private party
unwarranted benefits, advantage or preference in the discharge of his functions.
In this case, the information alleged that while being a public official and in the discharge of
his official functions and taking advantage of such position, Alvarez acting with evident bad faith or
gross inexcusable negligence or manifest partiality unlawfully gave API unwarranted benefits,
advantage or preference by awarding to it the contract for the construction of the shopping mall
under the BOT scheme despite the fact that it was not a licensed contractor and does not have the
experience and financial qualifications to undertake such costly project, among others, to the damage
and prejudice of the public service.
The third element of Sec. 3(e) of RA No. 3019 may be committed in three ways, i.e., through
manifest partiality, evident bad faith or gross inexcusable negligence. Proof of any of these three in
connection with the prohibited acts mentioned in the provision is enough to convict. Damage or
injury caused by Alvarez’s acts though alleged in the information, thus need not be proven for as long
as the act of giving any private party unwarranted benefits, advantage or preference either through
manifest partiality, evident bad faith or gross inexcusable negligence was satisfactorily established.
Contrary his assertion, the prosecution was able to successfully demonstrate that he acted with
manifest partiality and gross inexcusable negligence in awarding the BOT contract to an unlicensed
and financially unqualified private entity.
RUPERTO A. AMBIL, JR. v. SANDIGANBAYAN AND PEOPLE OF THE PHILIPPINES

G.R. Nos. 175457 & 175482, 6 July 2011, FIRST DIVISION (Villarama, Jr., J.)
Lawmakers opted to use private party rather than private person to describe the recipient of
the unwarranted benefits, advantage or preference for a reason. A private party is more comprehensive
in scope to mean either a private person or a public officer acting in a private capacity to protect his
personal interest.
Ruperto Ambil, Jr. (Ambil, Jr.) and Alexandrino R. Apelado, Sr. (Apelado, Sr.) were charged
with violation of Section 3(e) of Republic Act (RA) No. 3019, otherwise known as the Anti-Graft and
Corrupt Practices Act. The prosecution alleged that Ambil, Jr., who was then the Provincial Governor
of Eastern Samar, and Apelado, Sr., the Provincial Warden, released Mayor Francisco Adalim, who
was then accused and detained for murder.
Ambil, Jr.’s defense was that there was imminent danger to the person of Adalim – he being
detained in the company of inmates who were put away by his sister, Atty. Juliana Adalim-White and
that some of the guards were linked with his political opponents. Meanwhile, Apelado, Sr. claimed
that he was confronted by Atty. White assailing the detention of his brother Mayor Adalim, and who
informed him that he was under the governor. Thus, he claimed he was forced to relinquish custody
over Mayor Adalim. The Sandiganbayan found both accused guilty.
ISSUES:
1. Whether or not Ambil, Jr. and Apelado, Sr. are guilty of violating Section 3(e) of R.A. No. 3019.
2. Whether or not Ambil, Jr. and Apelado, Sr. are entitled to the justifying circumstances of
Article 11(5) and Article 11(6) of the Revised Penal Code (RPC), respectively.
3. Whether or not conspiracy exists between the accused.
RULING:
1. YES. Accused were charged with violation of Section 3(e) of R.A. No. 3019 or the Anti-Graft
and Corrupt Practices Act. As to the first element, there is no question that accused are public officers
discharging official functions and that jurisdiction over them lay with the Sandiganbayan. Jurisdiction
of the Sandiganbayan over public officers charged with violation of the Anti-Graft Law is provided
under Section 4 of Presidential Decree No. 1606, as amended by R.A. No. 8249. Thus, the jurisdiction
of the Sandiganbayan over Ambil, Jr. is beyond question. The same is true as regards Apelado, Sr. As
to him, a Certification from the Provincial Government Department Head of the HRMO shows that his
position as Provincial Warden is classified as Salary Grade 22. Nonetheless, it is only when none of
the accused are occupying positions corresponding to salary grade 27 or higher shall exclusive
jurisdiction be vested in the lower courts. Here, Apelado, Sr. was charged as a co-principal with
Governor Ambil, Jr., over whose position the Sandiganbayan has jurisdiction. Accordingly, he was
correctly tried jointly with said public officer in the proper court which had exclusive original
jurisdiction over them the Sandiganbayan.
The second element, for its part, describes the three ways by which a violation of Section 3(e)
of R.A. No. 3019 may be committed, that is, through manifest partiality, evident bad faith or gross
inexcusable negligence. In this case, we find that petitioners displayed manifest partiality and evident
bad faith in transferring the detention of Mayor Adalim to petitioner Ambil, Jr.’s house. There is no
merit to Ambil, Jr.’s contention that he is authorized to transfer the detention of prisoners by virtue
of his power as the Provincial Jailer of Eastern Samar. Significantly, it is the provincial government
and not the governor alone which has authority to exercise control and supervision over provincial
jails. Further, Section 3, Rule 114 of the Revised Rules of Criminal Procedure provides that the power
to order the release or transfer of a person under detention by legal process is vested in the court,
not in the provincial government, much less the governor. Likewise, amply established beyond
reasonable doubt is the third element of the crime. As mentioned above, in order to hold a person
liable for violation of Section 3(e), R.A. No. 3019, it is required that the act constituting the offense
consist of either (1) causing undue injury to any party, including the government, or (2) giving any
private party any unwarranted benefits, advantage or preference in the discharge by the accused of
his official, administrative or judicial functions.
2. NO. Ambil, Jr. invokes the justifying circumstance of fulfillment of duty or lawful exercise
of right or office. As we have earlier determined, Ambil, Jr. exceeded his authority when he ordered
the transfer and detention of Adalim at his house. Needless to state, the resulting violation of the Anti-
Graft Law did not proceed from the due performance of his duty or lawful exercise of his office. In
like manner, Apelado, Sr. invokes the justifying circumstance of obedience to an order issued for
some lawful purpose. While the order for Adalim’s transfer emanated from Ambil, Jr., neither said
order nor the means employed by Apelado, Sr. to carry it out was lawful. In his capacity as the
Provincial Jail Warden of Eastern Samar, Apelado, Sr. fetched Mayor Adalim at the provincial jail and,
unarmed with a court order, transported him to the house of petitioner Ambil, Jr. This makes him
liable as a principal by direct participation under Article 17(1) of the RPC.
3. YES. Conspiracy was sufficiently demonstrated by petitioner Apelado, Sr.’s willful

cooperation in executing Ambil, Jr.’s order to move Adalim from jail, despite the absence of a court
order. Apelado, Sr., a law graduate, cannot hide behind the cloak of ignorance of the law. The Rule
requiring a court order to transfer a person under detention by legal process is elementary. Truth be
told, even Ambil, Jr. who is unschooled in the intricacies of the law expressed reservations on his
power to transfer Adalim.
JOSE CATACUTAN v. PEOPLE OF THE PHILIPPINES

G.R. No. 175991, 31 August 2011 FIRST DIVISION (Del Castillo, J.)
Section 3(e) of the Anti-Corrupt and Graft Practices Act which states that one is liable if he
causes undue injury to the State when he is a public official, must be completed by the following
requisites: the accused must be a public officer discharging administrative, judicial or official functions;
he must have acted with manifest partiality, evident bad faith or inexcusable negligence; and his action
caused any undue injury to any party, including the government or gave any private party unwarranted
benefits, advantage or preference in the discharge of his functions.
Jose Catacutan is charged with the crime of violation of the Anti-Corrupt and Graft Practices
Act wherein the prosecution states that during his tenure as the Officer-in-Charge of the Surigao del
Norte of Arts and Trades (SNSAT), despite the promotion of Georgito Posesano and Magdalena
Divinagracia by the Civil Service Commission (CSC), he downright rejected to promote them since he
believes that they should not be merited of such promotion, and therefore ignored the written orders
of the Commission on Higher Education (CHED).
In his defense, Catacutan averred that he was not able to promote the two employees due to
the fact that there were some procedural lapses that bar such action. According to him, the
appointment papers were prepared by SNSAT Administrative Officer, Crispin Noguera, using blank
forms bearing the letterhead of SNSAT and not of the CHED Regional Office who made the
appointments. He likewise claimed that he received only the duplicate copies of the appointments
contrary to the usual procedure where the original appointment papers and other supporting
documents are returned to his office. Finally, he asserted that the transmittal letter from the CHED
did not specify the date of effectivity of the appointments. He alleged that his refusal to implement
the appointments of the private complainants was not motivated by bad faith but he just wanted to
protect the interest of the government by following strict compliance in the preparation of
appointment papers.
The Regional Trial Court (RTC) convicted Catacutan based on the ground that his actions
constituted fraud that caused damage to the employees who must be promoted. It was likewise
affirmed by the Sandiganbayan in toto.
ISSUE:
Whether or not Catacutan should be held guilty.
RULING:
YES. All the elements of the offense charged have been successfully proven by the
prosecution. First, petitioner could not have committed the acts imputed against him during the time
material to this case were it not for his being a public officer, that is, as the Officer-In-Charge
(Principal) of SNSAT. As such public officer, he exercised official duties and functions, which include
the exercise of administrative supervision over the school such as taking charge of personnel
management and finances, as well as implementing instruction as far as appointment of teachers.
Second, petitioner acted with evident bad faith in refusing to implement the appointments of
private complainants. As held by the Sandiganbayan: While petitioner may have laudable objectives
in refusing the implementation of private complainants valid appointments, the Court fails to see how
he can still claim good faith when no less than the higher authorities have already sustained the
validity of the subject appointments and have ordered him to proceed with the implementation. It is
well to remember that good intentions do not win cases, evidence does.
Third, undue injury to the private complainants was duly proven to the point of moral
certainty. Here, the private complainants suffered undue injury when they were not able to assume
their official duties as Vocational Supervisors III despite the issuance of their valid appointments. As
borne out by the records, they were able to assume their new positions only on November 19, 1997.
So in the interregnum from June to November 1997, private complainants failed to enjoy the benefits
of an increased salary corresponding to their newly appointed positions.
B.P. Blg. 22, Bouncing Checks Law
JAIME ALFEREZ v. PEOPLE OF THE PHILIPPINES AND PINGPING CO

Receipts for registered letters and return receipts do not by themselves prove receipt; they must
be properly authenticated to serve as proof of receipt of the letter, claimed to be a notice of dishonor.
Jaime Alferez (Alferez) bought construction materials for which he issued 3 checks as
payment. These checks, when presented, were dishonored for being drawn against a closed account.
Alferez was then charged with 3 counts of violation of Batas Pambansa Bilang (BP Blg.) 22. The
prosecution presented evidence such as the three checks allegedly issued by Alferez, the registry
receipt of the Post Office, and the face and dorsal side of the registry receipt. 10 months after the
prosecution rested its case, Alferez filed a Demurrer to Evidence arguing that the prosecution failed
to provide proof that he received the notice of dishonor or demand letter. The Municipal Trial Court
in Cities (MTCC) denied the demurrer and rendered judgment against Alferez. Both the Regional Trial
Court (RTC) and the Court of Appeals (CA) affirmed the MTCC decision.
ISSUE:
Whether or not the prosecution was able to prove Alferez’s guilt beyond reasonable doubt
for violation of BP 22.
RULING:
NO. The elements of the crime are, as follows: (1) the making, drawing, and issuance of any
check to apply on account or for value; (2) the knowledge of the maker, drawer, or issuer that at the
time of issue he does not have sufficient funds in or credit with the drawee bank for the payment of
the check in full upon its presentment; and (3) the subsequent dishonor of the check by the drawee
bank for insufficiency of funds or credit, or dishonor for the same reason had not the drawer, without
any valid cause, ordered the bank to stop payment.
In this case, the first and third elements of the crime have been adequately established. The
prosecution, however, failed to prove the second element. Because this element involves a state of
mind which is difficult to establish, Section 2 of B.P. Blg. 22 creates a presumption of knowledge of
insufficiency of funds. The prosecution merely presented a copy of the demand letter, together with
the registry receipt and the return card, allegedly sent to Alferez. However, there was no attempt to
authenticate or identify the signature on the registry return card. Receipts for registered letters and
return receipts do not by themselves prove receipt; they must be properly authenticated to serve as
proof of receipt of the letter, claimed to be a notice of dishonor. To be sure, the presentation of the
registry card with an unauthenticated signature, does not meet the required proof beyond
reasonable doubt that petitioner received such notice. It is not enough for the prosecution to prove
that a notice of dishonor was sent to the drawee of the check. The prosecution must also prove actual
receipt of said notice, because the fact of service provided for in the law is reckoned from receipt of
such notice of dishonor by the drawee of the check.
The absence of a notice of dishonor necessarily deprives the accused an opportunity to

preclude a criminal prosecution. As there is insufficient proof that Alferez received the notice of
dishonor, the presumption that he had knowledge of insufficiency of funds cannot arise. This is so
even if Alferez did not present his evidence to rebut the documentary evidence of the prosecution as
he had waived his right to present evidence for having filed a demurrer to evidence without leave of
court.
R.A. No. 8042, Illegal Recruitment
PEOPLE OF THE PHILIPPINES v. ROSARIO ROSE OCHOA

It is well-settled that to prove illegal recruitment, it must be shown that appellant gave
complainants the distinct impression that she had the power or ability to send complainants abroad for
work such that the latter were convinced to part with their money in order to be employed.
Rosario Ochoa (Ochoa) is charged with the crime of illegal recruitment in a large scale and
estafa by the prosecution wherein they were able to state that from February 1997 up to April 1999
in Quezon City, Rosario Ochoa recruited fifteen (15) persons which includes Robert Gubat, Junior
Agustin, and many others. Ochoa promised them an employment opportunity in Saudi Arabia and
Taiwan in exchange for a large consideration. Ochoa received the placement fees from her victims
although she has no authority to do so, as she was not licensed by the necessary government agencies.
Ochoa’s promise of employment did not materialize thus the complainants asked for a refund
of their money. However, Ochoa has not able to give back their money hence they decided to file a
case of illegal recruitment in large scale and estafa against Ochoa. Ochoa contends that she has
employed by AXIL International Services and Consultant (AXIL) as recruiter on December 20, 1997.
AXIL had a temporary license to recruit Filipino workers for overseas employment. She claims to
have remitted the money to AXIL but the latter failed to issue a receipt. The Regional Trial Court
(RTC) found Ochoa guilty of illegal recruitment in a large scale and estafa. The Court of Appeals (CA)
however directed the issue to the Supreme Court since it does not have jurisdiction over the case.
ISSUE:
Whether or not Ochoa committed illegal recruitment constituting economic sabotage.
RULING:
YES. It is well-settled that to prove illegal recruitment, it must be shown that appellant gave
complainants the distinct impression that she had the power or ability to send complainants abroad
for work such that the latter were convinced to part with their money in order to be employed. It is
shown in this case that all those who complained were able to testimony with consistency that Ochoa
had given them the illusion that she was clothed with power and authority to recruit laborers for
work abroad wherein she was able to get them to give the necessary vital documents such as birth
certificate, passports, and placement fees.
Under the last paragraph of Section 6 of Republic Act No. 8042, illegal recruitment shall be
considered an offense involving economic sabotage if committed in a large scale, that is, committed
against three or more persons individually or as a group. Here, there are eight private complainants
who convincingly testified on Ochoas acts of illegal recruitment.
In view of the overwhelming evidence presented by the prosecution, we uphold the verdict
of the RTC, as affirmed by the Court of Appeals, that Ochoa is guilty of illegal recruitment constituting
economic sabotage. Section 7(b) of Republic Act No. 8042 provides that the penalty of life
imprisonment and a fine of not less than P500,000.00 nor more than P1,000.000.00 shall be imposed
when the illegal recruitment constitutes economic sabotage.
Syndicated Illegal Recruitment
PEOPLE OF THE PHILIPPINES v. HADJA JARMA LALLI y PURIH, et al.

G.R. No. 195419, 12 October 2011, SECOND DIVISION (Carpio, J.)
The elements of syndicated illegal recruitment are: a) offender undertakes activity within the
meaning of “recruitment and placement” under Labor Code; b) he has no valid license or authority
required by law to enable one to fully engage in recruitment and placement; and c) illegal recruitment
is committed by a group of 3 or more persons conspiring with one another.
The case is a consolidated case for Illegal Recruitment and Trafficking in Persons. Lolita
Plando (Plando), 23 years old, met Ronnie Aringoy (Aringoy) and Rachel Cañete. Aringoy asked if
Plando is interested to work in Malaysia. Aringoy told her that she will work as restaurant
entertainer. Since Plando has no passport, she borrowed the passport of her sister. Aringoy brought
Plando to Hadja Jarma Lalli y Purih (Lalli), who will accompany Plando to Malaysia. Lalli introduced
Nestor Relampagos (Relampagos) to Plando as their financer. On the scheduled date of departure,
Plando met with Lalli, Arangay, and two other ladies who will be her workmates. Arangay gave
Plando boat ticket for the vessel bound for Malaysia. Upon arrival, Relampagos introduced Plando
and two other ladies to the Chinese Malay “Boss”, their employer. The Boss brought them to a
restaurant. A Filipina woman working at the restaurant told them that the place is a prostitution den.
Plando and her companions went back to the hotel and told Lalli and Relampagos that they refused
to work as prostitutes. Thereafter, Boss brought them to Pipen Club where they will entertain
customers. Plando was forced to work as entertainer in the club. Customers booked her either for
short time or overnight. For several days, she was forced to have sexual intercourse with different
guys. Plando was able to escape the ordeal when she had the chance to contact her sister who is also
working in Malaysia.
For the defense, Lalli claimed that she only met Plando on board the vessel while the vessel
was at sea and that the meeting was purely coincidental. They boarded the same van but parted ways
after. Aringoy admitted that he personally knows Plando and her interest to work in Malaysia. He
claimed that he merely told Plando to go to Lalli to ask pertinent information on job opportunities in
Malaysia. Aringoy presented witnesses who testified that Plando worked as GRO before. The ticketing
clerk of the vessel was presented in court and testified that Lalli bought tickets for her travel to
Malaysia, not only for herself but also for other women passengers. Regional Trial Court (RTC) found
Lalli and Aringoy guilty. Court of Appeals (CA) affirmed in toto.
ISSUE:
Whether or not there was syndicated illegal recruitment
RULING:
YES. Given the broad definition of recruitment and placement, even the mere act of referring
someone for placement abroad can be considered recruitment. Such act of referral, in connivance
with someone without the requisite authority or POEA license, constitutes illegal recruitment. In its
simplest terms, illegal recruitment is committed by persons who, without authority from the
government, give the impression that they have the power to send workers abroad for employment
purposes.
In this case, the trial court, as affirmed by the appellate court, found Lalli, Aringoy and
Relampagos to have conspired and confederated with one another to recruit and place Lolita for work
in Malaysia, without a POEA license. The three elements of syndicated illegal recruitment are present
in this case, in particular: (1) the accused have no valid license or authority required by law to enable
them to lawfully engage in the recruitment and placement of workers; (2) the accused engaged in
this activity of recruitment and placement by actually recruiting, deploying and transporting Lolita
to Malaysia; and (3) illegal recruitment was committed by three persons (Aringoy, Lalli and
Relampagos), conspiring and confederating with one another.
Aringoy claims and admits that he only referred Lolita to Lalli for job opportunities to
Malaysia. Such act of referring, whether for profit or not, in connivance with someone without a POEA
license, is already considered illegal recruitment, given the broad definition of recruitment and
placement in the Labor Code. Lalli, on the other hand, completely denies any involvement in the
recruitment and placement of Lolita to Malaysia, and claims she only met Lolita for the first time by
coincidence on board the ship M/V Mary Joy. Lallis denial does not deserve credence because it
completely conflicts with the testimony of Aringoy who claims he referred Lolita to Lalli who had
knowledge of the job opportunities in Malaysia. The conflicting testimonies of Lalli and Aringoy on
material facts give doubt to the truth and veracity of their stories, and strengthens the credibility of
the testimony of Lolita, despite allegations of irrelevant inconsistencies.
R.A. No. 9165, Comprehensive Dangerous Drugs Act of 2002
PEOPLE OF THE PHILIPPINES v. CARLO MAGNO AURE y ARNALDO and MELCHOR AUSTRIACO
y AGUILA
G.R. No. 185163, 17 January 2011, FIRST DIVISION, (Velasco, Jr., J.)
When the owner-possessor of drugs has not shown any proof that he was duly authorized by law
to possess them or any evidence to rebut his animus possidendi of the shabu found in his possession, then
he is guilty of violating RA 9165
On August 26, 2003, an informant came to the Office of the Makati Anti-Drug Abuse Council
Cluster 2 and reported that a certain Carlo, later identified as Carlo Magno Aure, was rampantly
selling illegal drugs along F. Nazario Street, Barangay Singkamas, Makati City. MADAC operative
Bilason was assigned as the poseur-buyer. Aure together with Austracio provided Bilason with six
thousand pesos worth of shabu. After ascertaining that what Aure gave him was shabu, Bilason
lighted his cigarette to signal to his team members that the transaction with Aure was already
consummated. Eventually, Aure and Austriaco were brought to the AIDSOTF office. The Regional
Trial Court convicted Aure and Austracio for violating Section 5 and 11, Article II of Republic Act No.
9165. On appeal to the Court of Appeals, the CA affirmed the judgment of the RTC.
ISSUE:
Whether or not Aure and Austracio are guilty of violating Section 5 and 11, Article II of
Republic Act No. 9165
RULING:
YES. Aure and Austracio failed to show any palpable error, arbitrariness, or oversight on the
findings of fact of the trial and appellate courts as to warrant a review of such findings. In the
prosecution for the crime of illegal sale of prohibited drugs under Sec. 5, Art. II of RA 9165, the
following elements must concur: (1) the identities of the buyer and seller, object, and consideration;
and (2) the delivery of the thing sold and the payment for it. What is material to the prosecution for
illegal sale of dangerous drugs is the proof that the transaction or sale actually occurred, coupled with
the presentation in court of the substance seized as evidence. In the instant case, all these were
sufficiently established by the prosecution.
The elements necessary for the prosecution of illegal possession of dangerous drugs are: (1)
the accused is in possession of an item or object which is identified to be a prohibited drug; (2) such
possession is not authorized by law; and (3) the accused freely and consciously possessed the said
drug. In the instant case, a brown bag was found inside the car of Aure. It yielded a plastic sachet
of shabu weighing 86.23 grams wrapped in red wrapping paper, small plastic sachets, and an
improvised plastic tooter. Considering that during the sale to Bilason, it was from the same bag that
Austriaco took the sachet of shabu, per order of Aure, the owner-possessor of said bag and its
contents is no other than Aure, who has not shown any proof that he was duly authorized by law to
possess them or any evidence to rebut his animus possidendi of the shabu found in his car during the
buy-bust operation.
PEOPLE OF THE PHILIPPINES v. LORIE VILLAHERMOSA y LECO

What is material to a prosecution for illegal sale of dangerous drugs is proof that the illicit
transaction took place, coupled with the presentation in court of the corpus delicti or the illicit drug as
evidence.
On 31 October 2002, PDEA received a telephone call from a concerned citizen that a certain
Tomboy, whose name was later known to be Lorie Villahermosa y Leco (Villahermosa) was engaged
in the rampant selling of illegal drugs inside the Manila South Cemetery. A buy-bust operation was
conducted against Villahermosa. After the consummation of the sale, Silverio gave their pre-
arranged signal, PO2 Tizon subsequently approached Villahermosa. PO2 Tizon then introduced
himself to Villahermosa as PDEA officer and subsequently effected her arrest for selling prohibited
drugs. Afterwards, Villahermosa was brought to MADAC Cluster 3 Office at the barangay hall of
Barangay Sta. Cruz, Makati City, for investigation. The items recovered from Villahermosa were all
marked by PO2 Tizon at the MADAC Cluster 3 Office, PO2 Tizon marked the two (2) plastic sachets
containing white crystalline substance by placing thereon the initials of the poseur-buyer,
Villahermosa was, thereafter, brought by the members of the buy-bust team to the PNP Crime
Laboratory at Camp Crame for drug testing. PO2 Tizon, on the other hand, brought the seized items
also to the PNP Crime Laboratory for examination. After a meticulous evaluation of all the
documentary, the trial court concluded that the prosecution has sufficiently proven all the elements
of the offenses charged against appellant. Thus, the trial court held Villahermosa guilty beyond
reasonable doubt of violating Sections 5, 11 and 12, Article II of Republic Act No. 9165 otherwise
known as Comprehensive Dangerous Drugs Act of 2002. Aggrieved, Villahermosa appealed to the
Court of Appeals (CA), CA affirmed the trial court Decision.
ISSUE:
Whether or not Villahermosa is guilty beyond reasonable doubt of violating the provisions of
R.A. No. 9165
RULING:
YES. In prosecution for illegal sale of dangerous drugs, the following elements must concur:
(1) the identity of the buyer and the seller, the object and the consideration of the sale; and (2) the
delivery of the thing sold and the payment therefor. The commission of the offense of illegal sale of
prohibited drugs requires merely the consummation of the selling transaction, which happens the
moment the buyer receives the drug from the seller. In the present case, Villahermosa was further
found to have in her possession six (6) more small plastic sachets of shabu with a total weight of 0.67
gram, which were the same kind of dangerous drug she was caught selling in flagrante delicto. The
said six (6) small plastic sachets of shabu were similarly presented in court, which Silverio and PO2
Tizon both identified to be the same objects recovered from Villahermosa while she was being frisked
by PO2 Tizon on the occasion of her arrest for illegally selling shabu.
Beyond cavil, the prosecution clearly established beyond reasonable doubt of Villahermosa’s
guilt for the offense of illegal sale of shabu, a dangerous drug, in violation of Section 5, Article II of
Republic Act No. 9165. It bears stressing that violation of Section 12, Article II of Republic Act No.
9165 was already consummated the moment Villahermosa was found in possession of the said
articles without the necessary license or prescription. What is primordial is the proof of the illegal
drugs and paraphernalia recovered from Villahermosa.
PEOPLE OF THE PHILIPPINES v. MANUEL CRUZ Y CRUZ

What is material to be establish for prosecution of illegal sale of shabu is the proof that the
transaction or sale transpired, coupled with the presentation in court of the corpus delicti.
The Prosecution alleged that the Philippine National Police (PNP) District Anti-Illegal Drugs
Special Operation Team (DAID-SOT) was informed by a male informant that a certain alias Maning
was engaged in selling illegal drugs. DAID-SOT Chief then directed police officer Nemesio Gallano
(Gallano) to verify the information by making phone calss to the people he knew in the place of the
alleged sale of illegal drugs, to which all of them positively responded and disclosed that he is
involved in such sale. A buy-bust operation then was conducted and Gallano was the poseur-buyer
and Darwin Boiser (Boiser) as his back-up. The buy-bust team proceeded to the target area, parked
their vehicles, and the male informant went to the house of Maning. The male informant introduced
Gallano who was in need of shabu. Maning asked Gallano for money and the latter handed the marked
money consisting of four (4) pieces of P500.00 peso bills, in exchange of one piece plastic sachet
containing white crystalline substance. Upon the pre-arranged signal of Gallano, the buy-bust team
arrested Maning, marked the plastic sachet of the substance subject of the sale. Thereafter, Manuel
Cruz (Manuel), alias Maning, was brought to DAID-SOT for investigation. Two (2) plastic sachets of
the substance were also seized from him and were brought for laboratory examination, in which they
yielded positive result for the presence of shabu.
On the other hand, the defense presented the lone testimony of Cruz, who denied all the
accusations. He claimed that while waiting for his turn to use a comfort room in his house, 4 to 5 male
persons in civilian clothes introduced themselves to be policemen, entered the gate of his house and
immediately arrested and handcuffed him for his alleged refusal to cooperate and to give them tong.
He was then brought to Fort Bonifacio and was detained for the alleged recovery of shabu. The
following day, he learned that he was charged with the illegal sale of shabu. The Regional Trial Court
(RTC) convicted him as charged, and the same was affirmed by the Court of Appeals (CA). Cruz now
contends that his warrantless arrest was illegal as he was not committing any crime at the time of his
arrest.
ISSUES:
1. Whether or not Cruz is guilty of the crime of sale of illegal drugs.

2. Whether or not his warrantless arrest is valid.
RULING:
1. YES. In this case, the prosecution successfully established the elements of the crime beyond
moral certainty. Cruz was caught in flagrante delicto delivering one piece plastic sachet containing
white crystalline substance to Gallano, the poseur-buyer, for a consideration of P2,000.00. The white
crystalline substance was later on confirmed to be methamphetamine hydrochloride or shabu per
chemistry report issued by the PNP Crime Laboratory. During trial, Gallano positively identified Cruz
as the same person who sold and handed him the plastic sachet in exchange for P2,000.00. When the
said one piece plastic sachet containing white crystalline substance confirmed to be shabu was
presented in court, Gallano identified it to be the same object sold to him by Cruz because of the
markings found thereon, which he, himself, has written at the place where Cruz was arrested. Gallano
similarly identified in court the recovered buy-bust money from appellant consisting of four (4)
pieces of P500 peso bills amounting to P2,000.00 with markings. With the foregoing, it is clear that
the sale transaction of illicit drug between the poseur-buyer and the appellant was successfully
consummated.
2. YES. In a buy-bust operation, the violator is caught in flagrante delicto and the police
officers conducting the same are not only authorized but also duty-bound to apprehend the violator
and consequently search him for anything that may have been part of or used in the commission of
the crime. In this case, after the police operatives of DAID-SOT received information from their male
informant regarding Cruz’s criminal activity, an entrapment plan was then set up. The same was
made specifically to test the veracity of the informant’s tip and to subsequently arrest the malefactor
if the report is found to be true. The prosecution’s evidence positively showed that Cruz agreed to
sell shabu to the poseur-buyer, who was introduced to him by the male informant. He was, in fact,
caught red-handed plying his illegal trade. Thus, the warrantless arrest of Cruz was legal and within
the confines of law. In the same breath, it cannot be doubted that the sachet of shabu seized from him
during the legitimate buy-bust operation is admissible and was properly admitted in evidence
against him.
PEOPLE OF THE PHILIPPINES v. ARNOLD CASTRO Y YANGA

Possession of dangerous drugs constitutes prima facie evidence of knowledge or animus

possidendi sufficient to convict an accused in the absence of a satisfactory explanation of such
possession.
The Prosecution alleged that members of the Galas Police Station, received a report from a
male informant that a certain alias Idol had been illegally selling drugs. A buy-bust operation team
was then formed, which included police officers Jaime Armenta (Armenta), as the poseur-buyer, and
Napoleon Zamora (Zamora). The buy-bust team went to the target area. Upon arrival, Armenta was
introduced to Arnold Castro (Castro), alias Idol, as a prospective buyer of shabu. Armenta handed the
100-peso buy-bust money to Castro, and the latter gave him a translucent plastic sachet containing
white crystalline substance. Upon the pre-arranged signal, the buy-bust team arrested Castro,
informed him of his violation, frisked him and recovered from his pocket two (2) more transparent
plastic sachets of white crystalline substance and the marked money. Armenta and Zamora took
custody of the three (3) plastic sachets and the marked money, respectively. When they reached their
office, Armenta marked the plastic sachet with his initials, the same also goes with Zamora. After they
were brought to the laboratory, the 3 plastic sachets tested positive for shabu.
On the other hand, Castro claimed that he was taking a rest in front of their house when a
police mobile car suddenly parked in front of him. He was forced to board the car and was brought
to the Galas Police Station, where a plastic sachet was shown to him. After he denied ownership
thereof, a police officer then allegedly told him that he would be released only if he had money. The
Regional Trial Court (RTC) found him guilty of violating Sections 5 and 11, Article II of Republic Act
No. (RA) 9165, as charged, and the same was affirmed by the Court of Appeals (CA).
ISSUE:
1. Whether or not Castro is guilty of illegal sale of dangerous drugs.

2. Whether or not Castro is guilty of illegal possession of dangerous drugs
RULING:
1. YES. In this case, the poseur-buyer, Armenta positively identified Castro during trial as the
seller of the illegal drugs. He also testified that, using the marked money, he paid for the object of the
crime.
2. YES. With respect to the charge of illegal possession of dangerous drugs under Section 11,
Article II of RA 9165, the evidence of the prosecution has sufficiently established the elements
thereof, to wit: (1) the accused is in possession of an item or object which is identified to be a
prohibited drug; (2) such possession is not authorized by law; and (3) the accused freely and
consciously possessed the said drug. Pertinently, possession of dangerous drugs constitutes prima
facie evidence of knowledge or animus possidendi insufficient to convict an accused in the absence
of a satisfactory explanation of such possession. As a consequence, the burden of evidence is shifted
to the accused to explain the absence of knowledge or animus possidendi. In the case at bar, Castro
miserably failed to discharge such burden.
RUEL AMPATUAN ALIAS RULE v. PEOPLE OF THE PHILIPPINES

In every prosecution for illegal sale of prohibited drugs, the presentation in evidence of the
seized drug, as an integral part of the corpus delicti, is most material. Thus, it is vital that the identity of
the prohibited drug be proved with moral certainty.
The Prosecution alleged that a buy-bust operation was conducted against a certain suspected
drug pusher by the name of Totong Ibrahim (Ibrahim). Police officers Arnel Micabalo (Micabalo) and
Francisco Caslib (Caslib) went to the house of Ibrahim posing as buyers. The policemen saw Ruel
Ampatuan and his wife, Linda, at the gate of the fence. They talked to the couple and pretended to
buy for a party, marijuana worth P500.00. The couple to wait outside the fence and then went inside
the house. The couple came out with another man, Maguid Lumna (Lumna). Ampatuan asked for the
payment, to which then poseur¬-buyers handed the marked money to Linda. Ampatuan then showed
the marijuana contained in one pack. Upon the pre-arranged signal, the rest of the police officers
proceeded to the scene, and the couple and Lumna were arrested and brought to the police station.
The seized object was turned over by the police station to the crime laboratory. The sample taken
yielded positive result for the presence of marijuana.
The Defense countered that Ampatuan, Linda, and his security guard, Lumna, went to the
house of Linda’s classmate for a lunch. While inside the house, they saw Ibrahim outside with two
companions. At that point, five police officers entered the premises where Ibrahim was and one of
them fired his gun. Failing to capture Ibrahim as he fled the scene, the police officers accused
Ampatuan to be the owner of the black bag containing marijuana samples carried by the police
officers. Ampatuan denied the ownership thereof and his participation in the sale or possession of
drugs. Ampatuan, Linda, and Lumna were charged with the crime of illegal sale of dangerous drugs.
The Regional Trial Court (RTC) convicted only Ampatuan, as charged. The same was affirmed by the
Court of Appeals (CA).
ISSUE:
Whether or not Ampatuan is guilty of the crime of illegal sale of dangerous drugs.
RULING:
YES. First, in a prosecution for illegal sale of dangerous drugs, the following elements must
be proven: (1) that the transaction or sale took place; (2) that the corpus delicti or the illicit drug was
presented as evidence; and (3) that the buyer and seller were identified. The presence of these
elements is sufficient to support the RTC’s finding of Ampatuan’s guilt. What is material is the proof
that the transaction or sale actually took place, coupled with the presentation in court of the
prohibited or regulated drug. The delivery of the contraband to the poseur-buyer and the receipt of
the marked money consummate the buy-bust transaction between the entrapping officers and the
accused. The presentation in court of the corpus delicti the body or substance of the crime establishes
the fact that a crime has actually been committed.
All of the elements are present in this case. The prosecution established that a buy-bust
operation was conducted by the members of the police force to entrap a drug pusher named Ibrahim.
However, despite his absence in the target area, the entrapment operation ensued within the same
place between the police officers who acted as poseur-buyers and Ampatuan. The Court found credit
to the straight-forward testimony of Caslib. Absence of any ill-will on the part of the prosecution
witnesses who were the best witnesses in prosecution for illegal sale of drugs, Ampatuan is guilty of
the said crime. Second, the following are the links that must be established in the chain of custody in
a buy-bust situation: (1) the seizure and marking, if practicable, of the illegal drug recovered from
the accused by the apprehending officer; (2) the turnover of the illegal drug seized by the
apprehending officer to the investigating officer; (3) the turnover by the investigating officer of the
illegal drug to the forensic chemist for laboratory examination; and (4) the turnover and submission
of the marked illegal drug seized from the forensic chemist to the court.
PEOPLE OF THE PHILIPPINES v. CHITO GRATIL y GUELAS

For conviction of the crime of illegal sale of prohibited or regulated drugs, the following
elements must concur: (1) the identities of the buyer and the seller, the object, and the consideration;
and (2) the delivery of the thing sold and the payment for it.
The Prosecution alleged that a confidential informant arrived at the PNP Central Narcotics
Office and talked to police officer Nolasco Cortez (Cortez) regarding the alleged illegal drug activity
of Chito Gratil (Gratil). A buy-bust operation team was then formed and police officer Manglo acted
as the poseur-buyer. Manglo and the confidential informant proceeded to the house of Gratil. But
then they went to another place. The confidential informant told Gratil that the money for the
purchase of shabu was already available. Gratil instructed the confidential informant to go to back to
his house in the afternoon so that the transaction on the shabu could be completed and that it should
be fast. After the meeting and the informant returned to the Central Narcotics Office and reported the
same. That afternoon, the buy-bust team went back to Gratil’s house. Manglo and Gratil were
introduced to each other. Upon learning that Manglo was the buyer of shabu, Gratil begged leave to
get the stuff outside and then left Manglo and the confidential informant in the sala of the groundfloor.
Gratil then returned and handed over a white plastic bag to Manglo which the latter verified if it
contained shabu. He found four heat sealed plastic bags containing crystalline substance. When
accused Gratil asked for the money, Manglo handed the marked P500 bill. Upon the pre-arranged
signal, Gratil was arrested. The seized plastic sachet was marked and then forwarded to the PNP
crime laboratory, and tested positive fo shabu.
On the other hand, Gratil countered that he was on his way to his cousins’ house when he saw
people running at an alley going towards him. Suddenly someone grabbed him by the collar and told
him to go to the police station for investigation. The Regional Trial Court (RTC) convicted him of
illegal sale of dangerous drugs, as charged.
ISSUE:
Whether or not Gratil is guilty of illegal sale of dangerous drugs.
RULING:
YES. In prosecutions involving the illegal sale of drugs, what is material is proof that the
transaction or sale actually took place, coupled with the presentation in court of the prohibited or
regulated drug as evidence. For conviction of the crime of illegal sale of prohibited or regulated drugs,
the following elements must concur: (1) the identities of the buyer and the seller, the object, and the
consideration; and (2) the delivery of the thing sold and the payment for it. Based on the records of
this case, the foregoing requisites are present. The proof of the shabu transaction was established by
prosecution witness Manglo, the poseur-buyer, who made a positive identification of the appellant
as the one who gave him the bag and to whom he gave the marked money during the buy-bust
operation.
Contrary to Gratil’s contention, the failure to conduct an inventory and to photograph the
confiscated items in the manner prescribed under the said provision of law applicable at the time of
appellants arrest and which is now incorporated as Section 21(1) of Republic Act (RA) No. 9165 that
repealed Republic Act No. 6425 cannot be used as a ground for his exoneration from the charge
against him, as the identity and integrity of the evidence was never put into serious doubt in the
course of the proceedings of this case.
PEOPLE OF THE PHILIPPINES v. JOEL GASPAR y WILSON

In cases involving violations of the Dangerous Drugs Act, credence is given to prosecution
witnesses who are police officers for they are presumed to have performed their duties in a regular
manner, unless there is evidence to the contrary suggesting ill-motive on the part of the police officers.
Joel Gaspar (Gaspar) was charged in four separate Informations for different violations of
Republic Act No. 9165 (RA 9165) or the Comprehensive Dangerous Drugs Act of 2002. Upon
receiving a text message that sale of shabu was in progress at the house of Gaspar, a buy-bust
operation was immediately conducted. Upon reaching the house of Gaspar, the police officers saw
two persons just outside the door. They saw that Gaspar handed something to Leomar San Antonio
(San Antonio). After San Antonio left Gaspar’s house, the police officers stopped San Antonio and
asked him what was handed to him by Gaspar. When they saw shabu in his hands, the police
immediately arrested San Antonio. Meanwhile, Police Officer 1 German Soreta (PO1 Soreta), who
acted as the poseur-buyer, approached Gaspar and told him that he was going to buy drugs. When
the sale was consummated, PO1 Soreta arrested Gaspar. The Regional Trial Court (RTC) convicted
Gaspar as charged. The RTC stated that given the presumption of regularity in the performance of
the police officers official duty and absent any clear showing of bias, malice or ill-motive on the part
of the prosecution witness, PO1 Soreta, the court gives credence to his testimony. The Court of
ISSUE:
Whether or not the prosecution was able to discharge its burden of establishing all the
elements of the crime charged.
RULING:
YES. In Criminal Case No. 12840-D, all the elements of the crime were present. PO1 Soreta
testified that he was the poseur-buyer in the buy-bust operation conducted and identified Gaspar as
seller of the plastic sachet containing shabu in exchange for a consideration of P200.00. The sale was
consummated after the exchange of buy-bust money and plastic sachet occurred. In People v. Encila,
the Court held that the delivery of the contraband to the poseur-buyer and the receipt of the marked
money consummate the buy-bust transaction between the entrapment officers and the accused. The
crime of illegal sale of dangerous drugs is committed as soon as the sale transaction is consummated.
On the other hand, under Section 11, Article II of RA 9165, the elements of the offense of illegal
possession of dangerous drugs are: (1) the accused is in possession of an item or object which is
identified to be a prohibited drug; (2) such possession is not authorized by law; and (3) the accused
freely and consciously possessed the said drug. Again, in Criminal Case No. 12841-D, all of these
elements were duly proven. PO1 Soreta properly identified Gaspar as the one he transacted with in
the buy-bust operation and later arrested after the sale took place. After being arrested in flagrante
delicto, the police officers found in Gaspar’s possession two small transparent plastic sachets each
containing 0.04 gram of shabu, a prohibited drug, which Gaspar was not authorized to possess. Here,
Gaspar failed to show that the police officers deviated from the regular performance of their duties.
Gaspar’s defense of denial is weak and self-serving. Unless corroborated by other evidence, it cannot
overcome the presumption that the police officers have performed their duties in a regular and
proper manner.
MICHAEL SAN JUAN y CRUZ v. PEOPLE OF THE PHILIPPINES

G.R. No. 177191, 30 May 2011, SECOND DIVISION, (Nachura, J.)
Transport as used under the Dangerous Drugs Act is defined to mean: to carry or convey from
one place to another.
Michael San Juan (San Juan), together with Pineda and Coderes, was charged with the crime
of Transporting Illegal Drugs. According to the Prosecution, the Intelligence Unit of the Pasay City
Police, conducted surveillance to arrest violators of the law along Senator Gil Puyat Avenue in Pasay
City. While cruising along Senator Gil Puyat Ave., the police officers noticed a Toyota Corolla sedan
car. SPO2 Aure and PO2 Dayawon approached the driver side of the car, SPO2 Aure knocked on the
cars window. When the driver opened the cars windows, SPO2 Aure asked for the Official Receipt
(OR) and the Certificate of Registration (CR) of the car but none was produced. SPO2 Aure was about
to accost San Juan, when a commotion ensued at the passenger side of the car because PO2 Jovenir
noticed that the passenger was trying to hide a plastic bag under his seat, the contents of which
accidentally came out. The contents were discovered to be plastic containers containing white
crystalline substance which the police officers suspected to be shabu. SPO2 Aure instructed San Juan
to alight. When he was frisked, SPO2 Aure recovered two small plastic sachets containing white
crystalline substance. At the back seat of the car was Coderes. Upon questioning, Coderes replied that
the owner of the shabu was a certain Mike who was waiting for the accused at her condominium unit.
Immediately thereafter, the police officers, with San Juan, went to the condominium for a
follow-up operation. Upon reaching the unit, Coderes pretended to knock on the door but the police
officers did not notice that she had a key with her. Coderes immediately opened the door, went inside
the unit and locked herself in. The police officers forcibly opened the door and rearrested Coderes.
They then searched the unit for Mike, but they discovered that Coderes was the only one inside. From
Cityland Condominium, the police officers brought all the accused to the Pasay City Police
Headquarters for investigation. The Regional Trial Court (RTC) convicted San Juan, Pineda, and
Coderes of the crime charged. Aggrieved, San Juan, appealed their case. The Court of Appeals (CA)
affirmed the ruling of the RTC.
ISSUE:
Whether or not San Juan is guilty beyond reasonable doubt for transportation of dangerous
drugs
RULING:
NO. From the foregoing facts of the case, it is clear that a conviction for transportation of
dangerous drugs cannot stand. Transport as used under the Dangerous Drugs Act is defined to mean:
to carry or convey from one place to another. The essential element of the charge is the movement
of the dangerous drug from one place to another. In the present case, although San Juan and his co-
accused were arrested inside a car, the car was not in transit when they were accosted. From the
facts found by the RTC, that car was parked and stationary. The prosecution failed to show that any
distance was travelled by San Juan with the drugs in his possession. The conclusion that San Juan
transported the drugs merely because he was in a motor vehicle when he was accosted with the
drugs has no basis and is mere speculation. The rule is clear that the guilt of the accused must be
proved with moral certainty. All doubts should be resolved in favor of the accused. It is the
responsibility of the prosecution to prove the element of transport of dangerous drugs, namely, that
transportation had taken place, or that the accused had moved the drugs some distance.
PEOPLE OF THE PHILIPPINES v. ARNEL ZAPATA y CANILAO
G.R. No. 184054, 19 October 2011, SECOND DIVISION (Brion, J.)
What is material to the prosecution of illegal sale of dangerous drugs is the proof that the
transaction or sale actually took place, coupled with the presentation in court of the corpus delicti of
evidence.
Arnel Zapata y Canilao (Zapata) was charged with illegal sale of dangerous drugs under
Section 5, Article II of Republic Act No. 9165. Regional Trial Court (RTC) found Zapata guilty of the
mentioned crime and held that the witnesses for the prosecution were able to prove that a buy bust
operation indeed took place and that the shabu was brought to and duly identified in the court. RTC
found no improper motive on the part of the police to falsely testify against Zapata. On appeal, the
Court of Appeals (CA) affirmed the RTC decision in toto. It held that poseur buyer positively identified
Zapata as the person who gave him 2 transparent plastic sachet in exchange for P300.00 it added that
the sachets were submitted to Philippine National Police (PNP) Crime Laboratory for examination,
and found positive for shabu. It further ruled that the chain of custody over the seized items was not
shown to have been broken.
ISSUE:
Whether or not Zapata’s conviction stands
RULING:
YES. For a successful prosecution of offenses involving illegal sale of drugs under Section 5,
Article II of RA No. 9165, the following elements must be proven: a) identity of the buyer and the
seller, the object of sale, and the consideration; and b) delivery of the thing sold and payment
therefor. What is material to the prosecution of illegal sale of dangerous drugs is the proof that the
transaction or sale actually took place, coupled with the presentation in court of the corpus delicti of
evidence.
In the case at bar, the prosecution showed the presence of all these elements. PO3 John
Salceda narrated in detail on how the police conducted a surveillance on Zapata for two months. PO3
Salcedo duly identified Zapata as the person who sold to him 2 sachets in exchange for P300.00. The
content was confirmed to be shabu. The marked money was identified by the arresting officers. PO1
Edwin Carlos corroborated the testimony of PO3 Salceda. Significantly, Zapata failed to produce
convincing proof that the prosecution witnesses had improper motive when they testified. The chain
of custody was unbroken. Evidence showed that PO3 Salcedo received two sachets from Zapata. PO3
Salceda and PO1 Carlos brought it to the police station. PO3 Salceda immediately marked the sachets
and turned it over to SPO3 Danilo Fernandez who made appropriate requests for laboratory
examination. Urine sample of Zapata and the 2 marked sachets were forwarded to PNP Crime
Laboratory. Both were found positive for presence of shabu. Prosecution established the crucial link
in the chain of custody from the time they were first seized until brought for examination and
presented in court. Clearly, the evidetiary and integrity value of the drugs seized were duly proven
not to have been compromised.
RAUL DAVID v. PEOPLE OF THE PHILIPPINES

The deliberate elimination of the classification of dangerous drugs is the main reason that under
RA No. 9165, the possession of any kind of dangerous drugs is now penalized under the same section.
After receiving information from a certain Victor Garcia that a person was selling illegal
drugs, the Intelligence Operatives of the Concepcion Police Station conducted a surveillance on the
place from May 25, 2003 until June 23, 2003 when they applied for a search warrant which was
granted on the same day. Before implementing the search warrant, police officers conducted another
surveillance during which it observed that several students were going inside Raul David’s (David)
house. It was also during that time that the poseur buyer was able to buy shabu from David. The
search team composed of PO3 Mario Flores, PO2 Henry Balatbat, SPO1 Rustico Basco, and PO1 Roger
Paras implemented the search warrant with the presence of the barangay captain. The search team,
before conducting the search, sought permission from David. PO3 Flores found 6 sachets of
marijuana and 3 plastic sachets of substance suspected to be shabu on top of a padlocked cabinet
underneath the stairs. Thereafter, police operatives took pictures of the items searched and the
barangay captain signified a certificate of good search. The confiscated items were then turned over
to Investigator Simplifico Cunanan. David was charged in two separate information with illegal
possession of shabu and illegal possession of marijuana.
During arraignment, David pleaded not guilty. He claimed that PO3 Flores grabbed him and
pulled him though his clothes and announced their authority to search. PO3 Flores allegedly saw
marijuana on top of cabinet. Afterwards, he was asked of the whereabouts of shabu. He was taken to
the police station, but he was not informed of his right to counsel. The Regional Trial Court (RTC)
found the accused guilty of illegal possession of marijuana and shabu. Court of Appeals (CA) affirmed
the conviction with modification.
ISSUE:
1. Whether or not David’s conviction should be sustained

2. Whether or not David should be convicted of single offense of possession of different kinds
of dangerous drugs
RULING:
1. YES. For a prosecution for illegal possession of dangerous drug to prosper, it must be shown
that: a) accused was in possession of an item or object identified to be prohibited or regulated drug;
b) such possession is not authorized by law; and c) accused was freely and consciously aware of being
in possession of the drug. In the present case, PO3 Flores found 6 sachets of marijuana and 3 sachets
of shabu, both classified as dangerous drugs under the law. The prosecution was able to prove the
unbroken chain of custody of the items seized. Witnesses for prosecution were able to categorically
testify that the dangerous drugs were found in the residence of David. As shown in Chemistry Report,
the 3 sachets were positive for shabu and the 6 for marijuana. The items were photographed and
barangay captain signed a certificate of good search. It is apparent that the integrity and evidentiary
value of the item seized were well- preserved.
2. YES. The deliberate elimination of the classification of dangerous drugs is the main reason that
under RA No. 9165, the possession of any kind of dangerous drugs is now penalized under the same
section. Absent any clear interpretation as to the application of the penalties, the Court shall construe
in favor of David. Thus, David may only be convicted of a single offense of possession of dangerous
drugs if caught in possession of different kinds of dangerous drugs in a single occasion.
PEOPLE OF THE PHILIPPINES v. ASMAD BARA y ASMAD

G.R. No. 184808, 14 November 2011, SECOND DIVISION (Brion, J.)
The delivery of the illicit drug to the poseur-buyer and the receipt by the seller of the marked
money successfully consummate the buy-bust transaction.
Senior Police Officer (SPO) 1 Rodolfo Ramos informed members of Western Police District,
District Anti-Illegal Drugs-Special Operations Group (DAID-SOG), about a planned buy-bust
operation after receiving information that Asmad Bara (Bara) was selling drugs on M. Adriatico
Street, Malate Manila.For the operation, they prepared two P100.00 bills and designated Police
Officer (PO)1 Alexander delos Santos as the poseur-buyer. Informant identified and introduced PO1
Delos Santos to Bara; PO1 Delos Santos asked about P200.00 worth of shabu from the Appellant.
Upon completion of the transaction, PO1 Delos Santos grabbed the Bara’s hand and introduced
himself as a police officer. The plastic sachet was handed to SPO1 Ramos.
At the police station, SPO1 Ramos handed the confiscated item to the desk investigator, who
marked it with the initials "AAB." Police Superintendent (P/Supt.) Marcelino Pedrozo, Jr. prepared a
covering request for laboratory examination and forwarded the confiscated item to the Philippine
National Police (PNP) Crime Laboratory for qualitative analysis. Police Inspector (P/Insp.) Maritess
Mariano, the PNP Forensic Chemical Officer, examined the submitted specimen and found it positive
for shabu. Bara was charged before the Regional Trial Court (RTC) with violation of Section 5, Article
II of R.A. No. 9165. The RTC convicted Bara. Such conviction was affirmed by the Court of Appeals
(CA).
ISSUE:
Whether or not the guilt of Bara for violation of Section 5, Article II of R.A. No. 9165 has been
proven beyond reasonable doubt.
RULING:
YES. In a prosecution for illegal sale of dangerous drugs, the following elements must be duly
established: (1) the identity of the buyer and the seller, the object, and the consideration; and (2) the
delivery of the thing sold and the payment therefor. The delivery of the illicit drug to the poseur-
buyer and the receipt by the seller of the marked money successfully consummate the buy-bust
transaction. What is material, therefore, is the proof that the transaction or sale transpired, coupled
with the presentation in court of the corpus delicti. Prosecution was successful in proving that the
buy-bust operation took place and the shabu subect of sale was brought to, and duly identified in,
court. PO1 Delos Santos was able to identify the appellant as the seller and the white crystalline
substances contained in the seized plastic sachet were examined and confirmed to be shabu, per
Chemistry Report.
The chain of custody of the confiscated item from the appellant is unbroken. PO1 Delos Santos
received the plastic sachet from the appellant, the former handed it to SPO1 Ramos. Thereafter, the
buy-bust team brought the appellant and the seized item to the police station. Upon arrival, SPO1
Ramos immediately handed the seized item over to the investigator, who marked it with the
appellant’s initials "AAB." The request for laboratory examination was made on the same day and,
together with this request, forwarded the seized item to the PNP Crime Laboratory for qualitative
analysis. The contents was found positive for the presence of shabu and PO1 Delos Santos was able
to identify the plastic sachet in court to be the same.
PEOPLE OF THE PHILIPPINES v. GREGG C. BUENAVENTURA

What is material to the prosecution for illegal sale of dangerous drugs is the proof that the
transaction or sale actually took place, coupled with the presentation in court of evidence of corpus
delicti.
In a buy bust operation, upon getting near the Gregg Buenaventura (Buenaventura), the
informant introduced PO1 Espares to the former as the one who wanted to buy shabu. Buenaventura
then asked how much and in reply, PO1 Espares said that he wanted to buy PHP200.00 worth of
shabu simultaneously handing, the PHP200.00 marked money to Buenaventura. In turn, the latter
took out from his right pocket a transparent plastic sachet containing white crystalline substance
which he handed to PO1 Espares. After getting hold of the plastic sachet, PO1 Espares lit a cigarette,
which was their pre-arranged signal signifying that the transaction had been consummated. Sensing
that something was amiss, Buenaventura immediately ran towards his house and locked the door.
PO1 Espares, together with his teammates who by then were with the former having responded to
the pre-arranged signal, followed and after announcing that they are police officers commanded
Buenaventura to open the door which was not done. Momentarily, they heard voices coming from
the roof-top and saw the suspect, together with another person, jump towards the kangkungan, a
watery part at the back of suspects house. Eventually, PO1 Espares and his companions were able to
corner and arrest Buenaventura. Recovered from Buenaventura was the marked buy-bust money
where PO1 Espares placed the markings MPE/GCB representing his initials and that of Buenaventura,
respectively, and the date 8.05.03 of the buy[-]bust operation. The specimen subject of the operation
was likewise marked by PO1 Espares with the markings MPE/GCB 08-05-03 and signed by him for
identification purposes. Buenaventura was later brought to the police station for investigation and
filing of the appropriate charges. At the police station, an investigation was conducted wherein PO1
Espares and PO3 Edilberto Sanchez executed a Joint Affidavit of Arrest.
Testifying in his defense, Buenaventura denied the allegations that he was engaged in illegal
selling of drugs. He further testified on cross-examination that it was only from his neighbors that he
learned that policemen came to his house while he was at his friend Pilo’s house. While at first, he
claims that he saw the soldier for the first time on August 5, 2003, he testified in the later part of his
cross-examination that two weeks prior to August 5, 2003 he already had a fight with the soldier.
Thus, on said date, when he heard loud knocks on the door, thinking it was the soldier trying to
avenge himself as a result of their quarrel, he ran with his friend, Edgardo Habana, and jumped into
the flooded kangkungan area lest he be shot.
ISSUE:
Whether or not Buenaventura is guilty of illegal sale of dangerous drugs
RULING:
YES. Police Officer (P0) 1 Michael Espares (Espares) and P03 Edilberto Sanchez (Sanchez),
police officers of Pasig City, provided clear and detailed testimonies, and corroborated each others
account of the entrapment or buy-bust operation their team conducted on August 5, 2003, during
which, they caught accused-appellant in flagrante delicto or while in the commission of the offense
of illegally selling dangerous drugs.
The entrapment operation was planned in response to a tip given by a confidential informant.
P01 Espares was designated as the poseur-buyer and two P100 bills were marked with his initials
ME. P03 Sanchez and the other members of the entrapment team positioned themselves nearby to
observe the transaction between PO1 Espares and accused-appellant. P01 Espares confidently
recalled the exchanges between him and accused-appellant. PO1 Espares then executed the pre-
arranged signal to let the other police officers know that the buy-bust transaction had been
consummated. Accused-appellant, already sensing that something was wrong, attempted to escape
by locking himself up in his house and jumping off the roof to an adjoining vacant lot. The police
officers pursued and eventually arrested accused-appellant, and seized from him the marked bills in
his possession. The plastic sachet containing white crystalline substance, obtained by PO1 Espares
from accused-appellant, was duly marked at the place where accused-appellant was apprehended.
Thereafter, the contents of the plastic sachet were subjected to forensic examination which yielded
positive results for methamphetamine hydrochloride, otherwise known as shabu.
PEOPLE OF THE PHILIPPINES v. MANUEL PALOMA Y ESPINOSA

G.R. No. 178544, 23 February 2011, SECOND DIVISION (Abad, J.)
To prove the crime of illegal sale of drugs under Section 5, Article II of R.A. 9165, the prosecution
is required to prove (a) the identity of the buyer and the seller as well as the object and consideration of
the sale; and (b) the delivery of the thing sold and the payment given for the same. Further, the
prosecution must present in court evidence of corpus delicti.
Manuel Paloma (Paloma) was charged of violation of R.A. 9165 or the Dangerous Drugs Act
of 2002. At the trial, PO2 Bernard Amigo testified that at about 1:00 p.m. on April 23, 2003 the Batasan
Police Station got a tip from an informant that accused Paloma was selling illegal drugs at in
Commonwealth, Quezon City. The station chief directed PO2 Amigo and PO1 Arnold Peñalosa to
conduct a buy-bust operation involving Paloma. When the buy-bust team arrived at Pacomara Street,
they saw Paloma standing beside a man and a woman. PO1 Peñalosa and the informant approached
them; PO2 Amigo, the witness, stood as back-up some 15 meters away. From where he stood, he saw
PO1 Peñalosa talking to Paloma. Momentarily, PO1 Peñalosa waved his hand, signifying that he had
made the purchase. On seeing the pre-arranged signal, PO2 Amigo approached and arrested Paloma;
PO1 Peñalosa for his part arrested Paloma’s companions, later on identified as Noriel Bamba
(Bamba) and Angie Grotel (Grotel). PO2 Amigo recovered from Paloma’s pants pocket a plastic sachet
with a white crystalline substance and the marked P100.00 bill.
After the police officers informed Paloma, Bamba, and Grotel of their rights during custodial
investigation, they brought them to the police station and turned them over to the desk officer. The
arresting officers also turned over the three sachets of suspected shabu that they seized. According
to PO2 Amigo, two of these sachets were those that PO1 Peñalosa bought from Paloma. The police
eventually let Bamba and Grotel go for the reason that the police officers found no illegal drugs in
their possession. In his defense, Paloma denied that such a buy-bust operation took place. He claimed
that at the time of the alleged buy-bust, he was with his 80-year-old mother at their house on
Pacomara Street, taking a nap. Suddenly, five armed men in civilian clothes barged into the house and
woke him up. Two of them held him by the arms while the others searched the house. Although the
men found nothing, they handcuffed him and brought him to the police station. The Regional Trial
Court found Paloma guilty beyond reasonable doubt. The Court of Appeals affirmed the decision of
the lower court.
ISSUE:
Whether or not the prosecution failed to establish that the crime was committed
RULING:
YES. Here, the proof of the sale of illegal drugs is wanting. One. Under the "objective" test set
by the Court in People v. Doria, the prosecution must clearly and adequately show the details of the
purported sale, namely, the initial contact between the poseur-buyer and the pusher, the offer to
purchase, the promise or payment of the consideration, and, finally, the accused’s delivery of the
illegal drug to the buyer, whether the latter be the informant alone or the police officer. This proof is
essential to ensure that law-abiding citizens are not unlawfully induced to commit the offense.
Here, PO2 Amigo’s testimony miserably failed to establish the required details of the
supposed illegal drug sale during his direct examination. All that PO2 Amigo could say was that PO1
Pealosa and the informant approached Paloma, talked to him, and then PO1 Pealosa made the pre-
arranged signal that the sale had been consummated. Since he was standing at a great distance during
the purported buy-bust, PO2 Amigo could not provide the details of the offer to buy the drug and the
acceptance of that offer. Indeed, he did not see Paloma take money from PO1 Pealosa nor Pealosa
take delivery of the prohibited substance from Paloma. The cross-examination of PO2 Amigo does
not help.
While law enforcers enjoy the presumption of regularity in the performance of their duties,
this presumption is disputable by contrary proof and cannot prevail over the constitutional right of
the accused to be presumed innocent. The totality of the evidence presented in this case does not
support Paloma’s conviction for violation of Section 5, Article II of R.A. 9165, since the prosecution
failed to prove beyond reasonable doubt all the elements of the offense.
PEOPLE OF THE PHILIPPINES v. BERTHA PRESAS y TOLENTINO

G.R. No. 182525, 02 March 2011, FIRST DIVISION, (Perez, J.)
As long as integrity and evidentiary value of the said illegal drugs are properly preserved, non-
compliance with the requirements under justifiable grounds shall not render void and invalid such
seizures of and custody over said items.
Two separate Informations were filed before the Regional Trial Court (RTC) against Bertha
Tolentino Presas (Presas) which her of an alleged illegal possession and use of shabu. Stating that the
accused sold, distributed and handed to Makati Anti Drug Abuse Council (MADAC) operative Gerardo
Farias (Farias), a police poseur buyer, a plastic sachet which was found positive to the test of
weighing zero point zero six (0.06) gram of shabu on or about the July 30, 2003 in Makati. Thereafter,
PO2 Tolentino, member of the buy-bust team, asked her to empty her pockets, and the buy-bust
money as well as another plastic sachet was recovered from her. Presas testified that she was dragged
out of her house and forcefully boarded her in to a vehicle. She denied selling shabu and any
knowledge of a buy-bust operation.
The RTC ruled the prosecution's evidence as sufficient to prove the elements for illegal sale
of shabu and held Presas as guilty of violation of Section 5, Article II of Republic Act No. 9165 and
sentencing her to suffer life imprisonment and to pay a fine of P500,000.00. She was however
acquitted of the charge of illegal possession of shabu. The Court of Appeals (CA) affirmed the decision.
Furthermore, CA assured for the credibility of the prosecution witnesses and rejected appellant’s
defense of denial, challenging the credibility of witnesses and claiming that certain regulations
providing for the chain of custody of seized drugs were not followed, holding the same as inherently
weak.
ISSUE:
Whether or not the Presas is guilty beyond reasonable doubt for violating the Comprehensive
Drugs Act
RULING:
YES. The Court ruled that the guilt of the appellant was established beyond reasonable doubt.
The Court maintains that in every prosecution for illegal sale of shabu under Section 5, Art. II of
Republic Act No. 9165 or the Comprehensive Dangerous Drugs Act of 2002, the following elements
must be sufficiently proved: (1) the identity of the buyer and the seller, the object and the
consideration; and (2) the delivery of the thing sold and the payment therefor. All these elements
were duly established as Presas was caught in flagrante delicto during a buy-bust operation.
Furthermore, the Court also affirms the credibility of the prosecution witnesses as they were
able to positively testify that the sale of shabu took place. Presas contention that the non-
representation of the forensic chemist renders the laboratory findings as hearsay evidence; however,
said non-representation is not fatal to the case. Appellant failed to impute any ill-motives on their
part to falsely testify against her. In the absence of any credible evidence to the contrary, their
testimonies enjoy the presumption of regularity.
Presas argue that the evidence adduced by the prosecution was not able to establish without
a doubt, that the dangerous drugs presented in court were the very same one allegedly sold by her.
She insists that the police officers failed to strictly abide by the requirements of Section 21 of RA 9165
as regards the proper custody of dangerous drugs seized in the course of the alleged buy-bust
operation. After due consideration, the Court held that failure of the prosecution to show that the
police officers complied strictly with the required physical inventory and photograph of the evidence
does not automatically render the items seized inadmissible. At any rate, the prosecution has shown
that the chain of custody of the seized items was not broken. Accordingly, as long as integrity and
evidentiary value of the said illegal drugs are properly preserved, non-compliance with the
requirements under justifiable grounds shall not render void and invalid such seizures of and custody
over said items.
PEOPLE OF THE PHILIPPINES v. RONALDO MORALES y FLORES alias Ronnie, and RODOLFO
FLORES y MANGYAN alias Roding.
What is material to the prosecution for illegal sale of dangerous drugs is the proof that the
transaction or sale actually took place, coupled with the presentation in court of evidence of corpus
delicti.
Acting on a tip from an informant that there is rampant selling of illegal drugs, a buy-bust
operation against Ronaldo Morales (Ronnie) and Rodolfo Flores (Roding) was conducted. The team,
headed by SPO2 Dante Rebolado (SP02 Rebolado), was composed of five (5) to six (6) members. Two
(2) pieces of P100.00 peso bills with Serial No. NR-699933 and No. LU-631498 were prepared, along
with 23 cut-out money-sized papers or boodle money. The initials WAA were marked on the two (2)
P100.00 peso bills. After the briefing, the team proceeded to the area and positioned himself inside a
vehicle, which was parked five (5) meters away from the target house. PO1 Alano and the informant
was approached by a man who identified himself as Roding, and the latter invited them to go inside
the house where they were met by Ronnie. The informant then ordered one (1) kilo of marijuana
from Ronnie for P3,000.00. Ronnie ordered Roding to get the money from PO1 Alano while he went
inside a room. A few seconds later, Ronnie went out of the room and handed PO1 Alano a green
transparent plastic bag containing two (2) brown folded envelopes, the contents of which are bricks
of dried marijuana. Immediately after verifying the contents as marijuana, PO1 Alano introduced
himself as a police officer and arrested Ronnie. Roding was able to go out of the house but he was
later on arrested by PO1 Buenafe, who responded to the scene when he noticed a commotion outside
the target house. The boodle money was seized from Roding. Appellants were brought to the South
Metro Narcotics District Office in Fort Bonifacio.
While at the police station, PO1 Alano placed his initials on each of the brown envelopes
containing the marijuana before bringing it to the Philippine National Police (PNP) Crime Laboratory.
The defense belied the allegations that there was a buy-bust operation conducted wherein they were
caught red-handed selling marijuana. On cross-examination, Ronnie claimed that he knew Roding
only two (2) days before they were arrested or on 16 August 1998 while Roding apparently came to
know Ronnie as early as November 1997.
ISSUE:
Whether or not Ronnie and Roding are guilty of illegal sale of drugs.
RULING:
YES. From his testimony, it can be culled that PO1 Alano gave P3,000.00 to Roding in
exchange for the green plastic sachet handed to PO1 Alano by Ronnie. His testimony was
corroborated by PO1 Buenafe, who in turn, was able to eventually recover the marked money from
Roding. Upon examination by the forensic chemist, it was proven that the green plastic bag bought
from appellants contains marijuana. Verily, all the elements of the sale of illegal drugs were
established.
Instigation
PEOPLE OF THE PHILIPPINES v. NENITA LEGASPI y LUCAS

It is an established rule that when an accused is charged with the sale of illicit drugs, the
following defenses cannot be set up:(1) that facilities for the commission of the crime were intentionally
placed in his way; or (2) that the criminal act was done at the solicitation of the decoy or poseur-buyer
seeking to expose his criminal act; or (3) that police authorities feigning complicity in the act were
present and apparently assisted in its commission.
San Andres and Sabo were assigned to the Mayor Special Action Team (MSAT), Pasig City
Police Station. On April 22, 2003, at around 4:00 p.m., a certain informant, whose identity remained
confidential, approached San Andres to report about the rampant incidence of drug abuse at
Centennial Village, Pinagbuhatan, Pasig City and about the drug pusher who was identified as
Legaspi. After gathering all the necessary details, San Andres immediately informed his superior,
Police Inspector Villaruel, who instructed him, Sabo, PO1 Aldrin Mariano, and PO1 Roland Panis to
conduct a buy-bust operation. Villaruel designated San Andres to act as the poseur-buyer and gave
him two pieces of one hundred-peso (₱100.00) bills to be used as buy-bust money. Mariano was
tasked to be the team leader, and he, along with the rest of the team, served as San Andress backup.
At around 5:15 p.m., the team reached Centennial Village, where after a briefing on their operations,
San Andres, together with the informant, proceeded to Legaspis house, while the others strategically
placed themselves in the entrapment area, keeping San Andres within their view. Upon seeing
Legaspi, who was just outside her house, the informant introduced San Andres to her as a scorer.
Legaspi asked them how much they wanted to score, to which San Andres replied ₱200.00 panggamit
lang. After San Andres gave Legaspi the buy-bust money, which he had previously marked with his
initials ABS, Legaspi reached into her pocket and gave him one heat-sealed plastic sachet containing
the suspected shabu. As soon as San Andres got the sachet, he scratched his head, to signal to his team
that the transaction was over. He thereafter introduced himself as a police officer, informed Legaspi
of her rights, and marked the sachet he had received from her with his initials. The team then brought
Legaspi to Rizal Medical Center for a check-up, and then to the police station wherein they filed the
appropriate charges against her.
On appeal, Legaspi contends that she was instigated to commit the crime, as she was not the
one who sought out San Andres to sell him shabu. She avers that San Andress own testimony clearly
shows that he had suggested the commission of the crime by offering her ₱200.00 for the purchase
of shabu. Legaspi claims that this is supported by her testimony wherein she denied selling shabu to
San Andres or to anyone for that matter. This, she says, is confirmed by the fact that she has no police
or criminal record.
ISSUE:
Whether or not there was instigation
RULING:
NO. Where the criminal intent originates in the mind of the instigating person and the accused
is lured into the commission of the offense charged in order to prosecute him, there is instigation and
no conviction may be had. Where, however, the criminal intent originates in the mind of the accused
and the criminal offense is completed, even after a person acted as a decoy for the state, or public
officials furnished the accused an opportunity for the commission of the offense, or the accused was
aided in the commission of the crime in order to secure the evidence necessary to prosecute him,
there is no instigation and the accused must be convicted. The law in fact tolerates the use of decoys
and other artifices to catch a criminal.
In the case at bar, the police officers, after receiving a report of drug trafficking from their
confidential informant, immediately set-up a buy-bust operation to test the veracity of the report and
to arrest the malefactor if the report proved to be true. The prosecution evidence positively showed
that Legaspi agreed to sell ₱200.00 worth of shabu to San Andres, who was then posing as a buyer.
Legaspi was never forced, coerced, or induced to source the prohibited drug for San Andres. In fact,
San Andres did not even have to ask her if she could sell him shabu. Legaspi was merely informed
that he was also a scorer; and as soon as she learned that he was looking to buy, she immediately
asked him how much he needed. Under the circumstances, the police officers were not only
authorized but were under an obligation to arrest Legaspi even without an arrest warrant as the
crime was committed in their presence.
PEOPLE OF THE PHILIPPINES v. ROMEO DANSICO Y MONAY A.K.A. “LAMYAK” AND AUGUSTO
CUADRA Y ENRIQUEZ
To determine whether there is instigation or entrapment, we held in People v. Doria that the
conduct of the apprehending officers and the predisposition of the accused to commit the crime must be
examined.
The Camarines Narcotics Provincial Office organized a buy-bust operation against appellants
Romeo Dansico (Dansico) and Augusto Cuadra (Cuadra). A poseur buyer and informant Willie Paz
was used by the polic. Paz went to the nipa hut owned by Dansico, informing them that he wanted to
buy marijuana. After three hours, Dansico and Cuadra returned with a brick, allegedly marijuana,
wrapped in newspaper. The police then arrested the two. Dansico and Cuadra pleaded not guilty to
the crime charged. The two argues that they were victims of frame-up and police extortion. The
Regional Trial Court convicted the two with the crime of illegal sale of marijuana. The Court of
Appeals affirmed the decision. In the Supreme Court, Dansico and Cuadra raised one of the issues
that the prosecution failed to establish the existence of a buy-bust operation and for the first time
raised the issue that they were instigated by the police to sell marijuana.
ISSUE:
Whether or not Dansico and Cuadra are guilty of illegal sale of marijuana with the defense
that the police instigated them into selling the drug.
RULING:
YES. To determine whether there is instigation or entrapment, we held in People v. Doria that
the conduct of the apprehending officers and the predisposition of the accused to commit the crime
must be examined: In buy-bust operations demands that the details of the purported transaction
must be clearly and adequately shown. This must start from the initial contact between the poseur-
buyer and the pusher, the offer to purchase, the promise or payment of the consideration until the
consummation of the sale by the delivery of the illegal drug subject of the sale. The manner by which
the initial contact was made, whether or not through an informant, the offer to purchase the drug,
the payment of the "buy-bust" money, and the delivery of the illegal drug, whether to the informant
alone or the police officer, must be the subject of strict scrutiny by courts to insure that law-abiding
citizens are not unlawfully induced to commit an offense. Criminals must be caught but not at all cost.
At the same time, however, examining the conduct of the police should not disable courts into
ignoring the accused's predisposition to commit the crime. If there is overwhelming evidence of
habitual delinquency, recidivism or plain criminal proclivity, then this must also be considered.
Courts should look at all factors to determine the predisposition of an accused to commit an offense
in so far as they are relevant to determine the validity of the defense of inducement.
In the present case, Paz testified to his initial contact with the confidential informant, on one
hand, and with the appellants, on the other. Acting as the poseur-buyer, Paz asked the appellants if
they had P5,000.00 worth of marijuana which the appellants told him was equivalent to one (1) kilo.
Paz and the appellants initially haggled over the price before the appellants left to get the marijuana
after receiving payment. The appellants were immediately arrested by the group of P/Insp. Vargas
after the marijuana was handed to Paz. Dionasco and Cuadra’s conversation with Paz best illustrates
that they were not at all instigated to sell marijuana, but were, in fact, engaged in the business of
selling marijuana.
R.A. No. 6539, Anti-Carnapping Law
PEOPLE OF THE PHILIPPINES v. RENATO LAGAT y GAWAN a.k.a. RENAT GAWAN and JAMES
PALALAY y VILLAROSA
Unexplained possession of a property raises a presumption that the party in possession is

responsible for the unlawful taking of the same. For such presumption to arise, it must be proven that:
(a) the property was stolen; (b) it was committed recently; (c) that the stolen property was found in the
possession of the accused; and (d) the accused is unable to explain his possession satisfactorily.
Renato Lagat y Gawan (Lagat), and James Palalay y Villarosa (Palalay) were charged with the
crime of Carnapping as defined under Section 2 and penalized under Section 14 of Republic Act No.
6539 for stealing and carrying away one (1) unit YASUKI tricycle then driven and owned by Jose Biag.
In the course of the commission of carnapping, or on occasion thereof, Lagat and Palalay killed Biag.
Police Officer 2 (PO2) Arthur Salvador, testified that they received a report from Esteban that the
cavans of palay stolen from him were seen at Alice Palay Buying Station in Alicia, Isabela, in a tricycle
commandeered by two unidentified male persons. At Alice Palay Buying Station, they saw the tricycle
described to them by their chief, with the cavans of palay, and Lagat and Palalay. PO2 Salvador
averred that he and his team were about to approach the tricycle when Lagat and Palalay scampered
to different directions. After collaring Lagat and Palalay , they brought them to the Alicia PNP Station
together with the tricycle and its contents. PO2 Salvador asseverated that when they reached the
station, they asked Lagat and Palalay if they had any papers to show for both the tricycle and the
palay, to which the two did not answer. PO2 Salvador then continued that when they unloaded the
tricycle, they discovered bloodstains inside and outside the sidecar. He also personally found a wallet
containing the tricycles Certificate of Registration and Official Receipt issued by the Land
Transportation Office in the name of Jose Biag. When they asked the two about their discoveries,
Lagat and Palalay voluntarily answered that the name in the papers is that of the owner of the tricycle,
whom they killed and dumped along Angadanan and San Guillermo Road, when they carnapped his
tricycle. Thereafter, they coordinated with the PNP of Angadanan Police Station, and together with
the two accused, they proceeded to Angadanan-San Guillermo Road, where they found Biag’s body in
a ravine just after the bridge near the road.
After the prosecution rested its case during trial, Lagat and Palalay filed a Motion to Dismiss on
Demurrer to Evidence without leave of court on the ground that the prosecution failed to prove their
guilt beyond reasonable doubt. Lagat and Palalay also claimed that the circumstantial evidence
presented by the prosecution was not sufficient to convict them. The Regional Trial Court (RTC)
found Lagat and Palalay guilty beyond reasonable doubt of qualified carnapping. The RTC held that
despite the absence of an eyewitness, the prosecution was able to establish enough circumstantial
evidence to prove that Lagat and Palalay committed the crime. Lagat and Palalay asked the RTC to
reconsider its Decision which the RTC denied. Lagat and Palalay went to the Court of Appeals (CA),
which however, affirmed the RTC’s ruling.
ISSUE:
Whether or not Lagat and Palalay are guilty of qualified carnapping.
RULING:
YES. The elements of carnapping as defined and penalized under the Anti-Carnapping Act of
1972 are the following: (1) That there is an actual taking of the vehicle; (2) That the vehicle belongs
to a person other than the offender himself; (3) That the taking is without the consent of the owner
thereof; or that the taking was committed by means of violence against or intimidation of persons, or
by using force upon things; and (4) That the offender intends to gain from the taking of the vehicle.
The records of this case show that all the elements of carnapping are present and were proven during
trial. The tricycle, which was definitively ascertained to belong to Biag, as evidenced by the
registration papers, was found in Lagat and Palalays possession. Aside from this, the prosecution was
also able to establish that Lagat and Palalay fled the scene when the Alicia PNP tried to approach
them at the palay buying station. To top it all, Lagat and Palalay failed to give any reason why they
had Biag’s tricycle. Their unexplained possession raises the presumption that they were responsible
for the unlawful taking of the tricycle.
Lagat and Palalays intent to gain from the carnapped tricycle was also proven as they were
caught in a palay buying station, on board the stolen tricycle, which they obviously used to transport
the cavans of palay they had stolen and were going to sell at the station. When a person is killed or
raped in the course of or on the occasion of the carnapping, the crime of carnapping is qualified and
the penalty is increased pursuant to Section 14 of Republic Act No. 6539, as amended.
R.A. No. 8484, Access Devices Regulation Act
MARK SOLDEDAD Y CRISTOBAL v. PEOPLE OF THE PHILIPPINES

R.A. No. 8484 does not define the word "possession." Thus, the Court held that use the term as
defined in Article 523 of the Civil Code, that is, "possession is the holding of a thing or the enjoyment of
a right."
Sometime in June 2004, private complainant Henry C. Yu (Yu) received a call on his mobile
phone from a certain "Tess" or "Juliet Villar" (later identified as Rochelle Bagaporo), a credit card
agent, who offered a Citi financing loan assistance at a low interest rate. Enticed by the offer, Yu
invited Bagaporo to go to his office in Quezon City. While in his office, Bagaporo indorsed Yu to her
immediate boss, a certain “Arthur” (later identified as petitioner Mark Soledad). In their telephone
conversation, Soledad told Yu to submit documents to a certain "Carlo" (later identified as Ronald
Gobenchiong). Yu submitted various documents, such as his Globe handyphone original platinum
gold card, identification cards and statements of accounts. During the first week of August 2004, Yu
received his Globe handyphone statement of account wherein he was charged for two (2) mobile
phone numbers, which were not his. Upon verification with the phone company, Yu learned that he
had additional five (5) mobile numbers in his name, and the application for said cellular phone lines
bore the picture of Soledad and his forged signature. Yu also checked with credit card companies and
learned that his Citibank Credit Card database information was altered and he had a credit card
application with Metrobank Card Corporation (Metrobank).
Thereafter, Yu and Metrobank’s junior assistant manager Jefferson Devilleres lodged a

complaint with the National Bureau of Investigation (NBI) which conducted an entrapment
operation. During the entrapment operation, NBI’s Special Investigator Salvador Arteche (Arteche),
together with some other NBI operatives, arrived in Las Piñas. Arteche posed as the delivery boy of
the Metrobank credit card. Upon reaching the address written on the delivery receipt, Arteche asked
for Henry Yu. Soledad responded that he was Henry Yu and presented to Arteche two (2)
identification cards which bore the name and signature of private complainant, while the picture
showed the face of Soledad. Soledad signed the delivery receipt. Thereupon, Arteche introduced
himself as an NBI operative and apprehended Soledad. Soledad was charged of violation of R.A. 8484
or the Access Device Regulation of 1998. The Regional Trial Court convicted Soledad. The Court of
ISSUE:
Whether or not Soledad was legally in “possession” of the credit card subject of the case.
RULING:
YES. The trial court convicted Soledad of possession of the credit card fraudulently applied
for, penalized by R.A. No. 8484. The law, however, does not define the word "possession." Thus, the
Court held that use the term as defined in Article 523 of the Civil Code, that is, "possession is the
holding of a thing or the enjoyment of a right." The acquisition of possession involves two elements:
the corpus or the material holding of the thing, and the animus possidendi or the intent to possess it.
Animus possidendi is a state of mind, the presence or determination of which is largely dependent
on attendant events in each case. It may be inferred from the prior or contemporaneous acts of the
accused, as well as the surrounding circumstances.
In this case, prior to the commission of the crime, Soledad fraudulently obtained from private
complainant Yu various documents showing the latter’s identity. He, thereafter, obtained cellular
phones using Yu’s identity. Undaunted, he fraudulently applied for a credit card under the name and
personal circumstances of private complainant. Upon the delivery of the credit card applied for, the
"messenger" (an NBI agent) required two valid identification cards. Soledad thus showed two
identification cards with his picture on them, but bearing the name and forged signature of Yu. As
evidence of the receipt of the envelope delivered, Soledad signed the acknowledgment receipt shown
by the messenger, indicating therein that the content of the envelope was the Metrobank credit card.
Soledad materially held the envelope containing the credit card with the intent to possess.
Contrary to Soledad’s contention that the credit card never came into his possession because it was
only delivered to him, the above narration shows that he, in fact, did an active part in acquiring
possession by presenting the identification cards purportedly showing his identity as Henry Yu.
Certainly, he had the intention to possess the same. Had he not actively participated, the envelope
would not have been given to him. Moreover, his signature on the acknowledgment receipt indicates
that there was delivery and that possession was transferred to him as the recipient. Undoubtedly,
petitioner knew that the envelope contained the Metrobank credit card, as clearly indicated in the
acknowledgment receipt, coupled with the fact that he applied for it using the identity of private
complainant.
P.D. 969, Anti-Pornography Act
FREDRIK FELIX P. NOGALES, GIANCARLO P. NOGALES, ROGELIO P. NOGALES, MELINDA P.

NOGALES, PRISCILA B. CABRERA, PHIL-PACIFIC OUTSOURCING SERVICES CORPORATION and
3 X 8 INTERNET v. PEOPLE OF THE PHILIPPINES and PRESIDING JUDGE TITA BUGHAO
ALISUAG
To stress, P.D. No. 969 mandates the forfeiture and destruction of pornographic materials
involved in the violation of Article 201 of the Revised Penal Code, even if the accused was acquitted.
The operatives of the Special Task Force of the NBI implemented a search warrant and seized
the following items: (1) Ten units of Central Processing Units (CPUs); (2) Ten units of monitors; (3)
Ten (10) units of keyboard; (4) Ten units of mouse; and (5) Ten units of AVRs. The Regional Trial
Court (RTC) then issued an order granting the prayer of SI Meez to keep the seized items in the NBI
evidence room and under his custody with the undertaking to make said confiscated items available
whenever the court would require them. Aggrieved by the issuance of the said order, the named
persons in the search warrant filed a Motion to Quash Search Warrant and Return Seized Properties.
On appeal, Nogales, et al. argue that there is no evidence showing that they were the source of
pornographic printouts presented by the NBI to the RTC or to the City Prosecutor of Manila in I.S. No.
07H-13530. Since the hard disks in their computers are not illegal per se unlike shabu, opium,
counterfeit money, or pornographic magazines, said merchandise are lawful as they are being used
in the ordinary course of business, the destruction of which would violate not only procedural, but
substantive due process.
ISSUE:
Whether or not there was grave abuse of discretion on the part of the CA in ordering the
removal and destruction of the hard disks containing the pornographic and obscene materials.
RULING:
NO. The argument of petitioners is totally misplaced considering the undisputed fact that the
seized computer units contained obscene materials or pornographic files. Had it been otherwise,
then, petitioner’s argument would have been meritorious as there could be no basis for destroying
the hard disks of petitioners computer units. While it may be true that the criminal case for violation
of Article 201 of the Revised Penal Code was dismissed as there was no concrete and strong evidence
pointing to them as the direct source of the subject pornographic materials, it cannot be used as basis
to recover the confiscated hard disks. At the risk of being repetitious, it appears undisputed that the
seized computer units belonging to them contained obscene materials or pornographic files. Clearly,
petitioners had no legitimate expectation of protection of their supposed property rights.
The CA is correct in stating that the removal of the hard disk from the CPU is a reliable way
of permanently removing the obscene or pornographic files. Clearly, the provision directs the
forfeiture of all materials involved in violation of the subject law. The CA was lenient with petitioners
in modifying the ruling of the RTC in that the CPUs and softwares, which were initially ordered to be
retained by the NBI, should be released in their favor with only the hard disk removed from the CPUs
and destroyed. If the softwares are determined to be violative of Article 201 of the RPC, unlicensed
or pirated, they should also be forfeited and destroyed in the manner allowed by law. The law is clear.
Only licensed softwares that can be used for legitimate purposes should be returned to petitioners.
Taking into account all the circumstances of this case, the Court holds that the destruction of
the hard disks and the softwares used in any way in the violation of the subject law addresses the
purpose of minimizing if not totally eradicating pornography. This will serve as a lesson for those
engaged in any way in the proliferation of pornography or obscenity in this country. The Court is not
unmindful of the concerns of petitioners but their supposed property rights must be balanced with
the welfare of the public in general.
P.D. 705, Possession of Timber
CRISOSTOMO VILLARIN v. PEOPLE OF THE PHILIPPINES

G.R. No. 175289, 31 August 2011 FIRST DIVISION (Del Castillo, J.)
Mere possession of timber without the legal documents required under forest laws and
regulations makes one automatically liable of violation of Section 68, Presidential Decree (P.D.) No. 705.
Lack of criminal intent is not a valid defense.
Villarin and his cohorts are charged with the crime of violating Section 68, of Presidential
Decree No. 705 (PD 705) of the possession timber without the necessary legal documents. Various
testimonies and evidence were collated by the prosecution such as the television footage of RTV
which recorded the coconut timber being tried to be concealed by some men in order to be
transported to a bridge in order to be a material in its repair. Supporting evidence from the same
locality stated that such timber were being transported to and fro from one place to another by a
jeepney. The Department of Environmental and Natural Resources (DENR) Strike Team
apprehended the suspects and gained possession of the said timber. Villarin presented the evidence
that he only tried to be benevolent and tried to fulfill the wishes of his constituents as a barangay
captain in repairing the dilapidated bridge that obstructs the everyday transport to and from their
locality.
ISSUE:
Whether or not Villarin and his cohorts should be liable for the violation of Presidential
Decree No. 705.
RULING:
YES. Mere possession of timber without the legal documents required under forest laws and
regulations makes one automatically liable of violation of Section 68, Presidential Decree (P.D.) No.
705. Lack of criminal intent is not a valid defense.
Philippine Fisheries Code

SEA LION FISHING CORPORATION v. PEOPLE OF THE PHILIPPINES
When an instrument or tool used in a crime is being claimed by a third-party not liable to the
offense, such third-party must first establish its ownership over the same.
Seventeen Chinese fishermen were charged with the violation of Section 97 and Section 87 of
R.A. 8550 (Philippine Fisheries Code of 1998) in two separate Informations after the Philippine
Marines, Coast Guard and barangay officials, who received reports of poaching activities, arrested
them in Palawan. Meanwhile, Sea Lion Fishing Corp., alleging that it owns the vessel, filed an urgent
motion for release of evidence. The Office of the Provincial Prosecutor released two resolutions,
which states that the vessel can only be released upon proper showing of evidence that Sea Lion owns
the vessel, upon the posting of a bond, and upon approval of the Provincial Committee on Illegal
Entrants. Sea Lion failed to comply.
The Regional Trial Court (RTC) convicted the 17 Chinese fishermen. After the decision was
promulgated, only then did Sea Lion filed a Motion for Reconsideration praying that the confiscation
of the F/V Sea Lion be deleted from the ruling. The RTC denied the motion. The Court of Appeals (CA)
likewise denied Sea Lion’s petition. Sea Lion claims that the vessel should be released because they
are the owner thereof, and its captain and crew were not among those accused in the criminal cases
pursuant to Art. 45 of the Revised Penal Code (RPC). They added that they were denied due process
when they were not notified of the judicial proceedings relative to the confiscation of the fishing
vessel.
The Office of the Solicitor General counters that R.A. 8550 applies, which provides that the
vessel used in connection with or in direct violation of the provisions of RA 8550 shall be subjected
to forfeiture in favor of the government without mention of any distinction as to who owns the vessel.
ISSUE:
Whether or not Sea Lion can claim the fishing vessel which was subject to forfeiture in the
criminal case against the Chinese fishermen.
RULING:
NO. Sea Lion’s claim of ownership of F/V Sea Lion is not supported by any proof on record.
The only document on record that is relevant in this regard is a request for the release of the F/V Sea
Lion based on Sea Lion’s alleged ownership filed with the Provincial Prosecutor. While the latter
authorized the release of said fishing vessel, this was conditioned upon Sea Lion’s submission of a
proof of ownership and the filing of a bond, with which they failed to comply. Even when judicial
proceedings commenced, nothing was heard from them. No motion for intervention or any
manifestation came from Sea Lion’s end during the period of arraignment up to the rendition of
sentence. While Sea Lion later explained before the CA that its inaction was brought about by its
inability to put up the required bond due to financial difficulties, the same is still not a sufficient
justification for it to deliberately not act at all.
It was only after the trial court ordered the confiscation of F/V Sea Lion in its assailed twin
Sentences that Sea Lion was heard from again. It has been established beyond reasonable doubt that
F/V Sea Lion was used by the 17 Chinese fishermen in the commission of the crimes. On the other
hand, Sea Lion presented no evidence at all to support its claim of ownership of F/V Sea Lion.
Therefore, the forfeiture of F/V Sea Lion in favor of the government was proper.
REMEDIAL LAW
CRIMINAL PROCEDURE
Jurisdiction
ANGELITO MAGNO v. PEOPLE OF THE PHILIPPINES, et al.

G.R. No. 171542, 6 August 2011, THIRD DIVISION (Brion, J.)
The Sandiganbayan, not the CA, has appellate jurisdiction over the RTCs decision not to allow
Atty. Sitoy to prosecute the case on behalf of the Ombudsman
On May 14, 2003, the Office of the Ombudsman filed an information for multiple frustrated
murder and double attempted murder against several accused, including Angelito Magno (Magno),
who were public officers working under the National Bureau of Investigation.
During the scheduled arraignment, Magno, in open court, objected to the formal appearance
and authority of Atty. Sitoy, who was there as private prosecutor to prosecute the case for and on
behalf of the Office of the Ombudsman. The Office of the Ombudsman submitted its comment, while
the accused submitted their joint opposition. Magno, likewise submitted his comments to the
opposition of the other co-accused.
The Regional Trial Court (RTC) issued an Order, ruling that "the Ombudsman is proper, legal
and authorized entity to prosecute this case to the exclusion of any other entity/person other than
those authorized under R.A. 6770”. In the Court of Appeals (CA), the court held that the prosecutor
could appear. The case was elevated to the Supreme Court where Magno insists that the
Sandiganbayan has jurisdiction over the case, hence, the CA erred in rendering its decision over the
case.
ISSUE:
Whether or not the contention of Magno that the Sandiganbayan has the jurisdiction over his
case is meritorious.
RULING:
YES. The Sandiganbayan, not the CA, has appellate jurisdiction over the RTC’s decision not to
allow Atty. Sitoy to prosecute the case on behalf of the Ombudsman. In cases where none of the
accused are occupying positions corresponding to Salary Grade "27" or higher, as prescribed in the
said Republic Act No. 6758, or military or PNP officers mentioned above, exclusive original
jurisdiction thereof shall be vested in the proper regional trial court, metropolitan trial court,
municipal trial court, and municipal circuit trial court, as the case may be, pursuant to their respective
jurisdictions as provided in Batas Pambansa Blg. 129, as amended.
The Sandiganbayan shall exercise exclusive appellate jurisdiction over final judgments,
resolutions or orders of regional trial courts whether in the exercise of their own original jurisdiction
or of their appellate jurisdiction as herein provided. Also, it has exclusive original jurisdiction over
petitions for the issuance of the writs of mandamus, prohibition, certiorari, habeas corpus,
injunctions, and other ancillary writs and processes in aid of its appellate jurisdiction and over
petitions of similar nature, including quo warranto, arising or that may arise in cases filed or which
may be filed under Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986: Provided, That the
jurisdiction over these petitions shall not be exclusive of the Supreme Court.
The procedure prescribed in Batas Pambansa Blg. 129, as well as the implementing rules that
the Supreme Court has promulgated and may hereafter promulgate, relative to appeals/petitions for
review to the Court of Appeals, shall apply to appeals and petitions for review filed with the
Sandiganbayan. In all cases elevated to the Sandiganbayan and from the Sandiganbayan to the
Supreme Court, the Office of the Ombudsman, through its special prosecutor, shall represent the
People of the Philippines, except in cases filed pursuant to Executive Order Nos. 1, 2, 14 and 14-A,
issued in 1986.
In case private individuals are charged as co-principals, accomplices or accessories with the
public officers or employees, including those employed in government-owned or controlled
corporations, they shall be tried jointly with said public officers and employees in the proper courts
which shall exercise exclusive jurisdiction over them. Thus, it is clear: the Sandiganbayan has
exclusive appellate jurisdiction over resolutions issued by RTCs in the exercise of their own original
jurisdiction or of their appellate jurisdiction.
Institution of Criminal Actions
BUREAU OF CUSTOMS v. PETER SHERMAN, et. al.

All criminal actions commenced by complaint or information are prosecuted under the direction
and control of public prosecutors. In the prosecution of special laws, the exigencies of public service
sometimes require the designation of special prosecutors from different government agencies to
assist the public prosecutor. The designation does not, however, detract from the public prosecutor
having control and supervision over the case.
Mark Sensing Philippines, Inc. (MSPI) caused the importation of 255, 870,000 pieces of
finished bet slips and 205, 200 rolls of finished thermal papers from June 2005 to January 2007. MSPI
facilitated the release of the shipment from the Clark Special Economic Zone (CSEZ), where it was
brought, to the Philippine Charity Sweepstakes Office (PCSO) for its lotto operations in Luzon. MSPI
did not pay duties or taxes, however, prompting the Bureau of Customs (BOC) to file, under its Run
After The Smugglers (RATS) Program, a criminal complaint before the Department of Justice against
herein respondents MSPI Chairman Peter Sherman, et. al. (Sherman, et. al) for violation of the Tariff
and Customs Code of the Philippines, as amended and Republic Act No. 7916.
State Prosecutor Rohaira Lao-Tamano, by Resolution of March 25, 2008, found probable
cause against Sherman, et. al and accordingly recommended the filing of Information against them.
Sherman, et. al filed a petition for review before the Secretary of Justice during the pendency of which
the Information was filed before the Court of Tax Appeals (CTA). The Secretary of Justice reversed
the State. The Secretary asked the prosecutor to widthraw the information. Prosecutor Lao-Tamano
filed before the CTA a motion to withdraw the information.
The CTA, by the herein assailed Resolution of September 3, 2009, granted the withdrawal of,
and accordingly dismissed the Information. BOC's motion for reconsideration filed was Noted
Without Action by the CTA by Resolution; it then filed a petition for certiorari before the Supreme
Court.
ISSUE:
Whether or not petition of BOC is meritorious.
RULING:
NO. It is well-settled that prosecution of crimes pertains to the executive department of the
government whose principal power and responsibility is to insure that laws are faithfully executed.
Corollary to this power is the right to prosecute violators. All criminal actions commenced by
complaint or information are prosecuted under the direction and control of public prosecutors. In
the prosecution of special laws, the exigencies of public service sometimes require the designation of
special prosecutors from different government agencies to assist the public prosecutor. The
designation does not, however, detract from the public prosecutor having control and supervision
over the case.
As stated in the above-quoted ratio of the October 14, 2009 Resolution of the CTA, it noted
without action petitioner's motion for reconsideration, entry of judgment having been made as no
Motion for Execution was filed by the State Prosecutor. By merely noting without action BOC's motion
for reconsideration, the CTA did not gravely abuse its discretion. For, as stated earlier, a public
prosecutor has control and supervision over the cases. The participation in the case of a private
complainant, like petitioner, is limited to that of a witness, both in the criminal and civil aspect of the
case.
Parenthetically, BOC is not represented by the Office of the Solicitor General (OSG) in
instituting the present petition, which contravenes established doctrine that "the OSG shall represent
the Government of the Philippines, its agencies and instrumentalities and its officials and agents in
any litigation, proceeding, investigation, or matter requiring the services of lawyers.
Real Party in Interest
CITY GOVERNMENT OF TUGUEGARAO, represented by ROBERT P. GUZMAN v. RANDOLPH S.

TING
G.R. Nos. 192435-36, September 14, 2011, FIRST DIVISION, (Villarama, Jr., J.)
A private complainant in a criminal case before the Sandiganbayan is allowed to appeal only
the civil aspect of the criminal case after its dismissal by said court.
In connection with the allegedly anomalous purchase of lot by then City Mayor Ting, a
complaint was filed by Robert P. Guzman (Guzman) for violation of Section 3(g) of Republic Act (R.A.)
No. 3019 (Anti-Graft and Corrupt Practices Act) against Ting. Initially the Ombudsman found
probable cause for the filing of two informations against Ting. However when Ting move for
reinvestigation which was treated as a motion for reconsideration, the Ombudsman reversed herself
and found no probable cause to charge the Ting with violation of Section 3(g) of R.A. No. 3019. As
such, the Office of the Special Prosecutor moved for the withdrawal of the informations against Ting.
This motion was granted by the Sandiganbayan thereby causing the dismissal of the case. Guzman
appealed before the Supreme Court. In his comment, Ting alleged that Guzman cannot represent
Tuguegarao City before the courts as he is not a proper party.
ISSUE:
Whether or not Guzman has the necessary legal standing to represent the City Government
of Tuguegarao in the present action.
RULING:
NO. Section 4 (c) of P.D. No. 1606, as amended, clearly provides that "In all cases elevated to
the Sandiganbayan and from the Sandiganbayan to the Supreme Court, the Office of the Ombudsman,
through its special prosecutor, shall represent the People of the Philippines, except in cases filed
pursuant to Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986."
A private complainant in a criminal case before the Sandiganbayan is allowed to appeal only
the civil aspect of the criminal case after its dismissal by said court. While Guzman’s name was
included in the caption of the cases as private complainant during the preliminary investigation and
re-investigation proceedings in the Office of the Ombudsman, he is not the offended party or private
complainant in the main case. As evident from a reading of the informations, it is the City of
Tuguegarao which suffered damage as a consequence of the subject purchase of lands by the
respondent and hence is the private complainant in the main case.
The Court has previously held that the "party" referred to in the rule is the original party in
the main case aggrieved by the order or decision in the main case. Hence, only the aggrieved original
party in the main case is the only proper party as petitioner. One who has not been an original party
in the main case has no personality to file a petition under said rule.
Probable Cause
CLAY & FEATHER INTERNATIONAL, INC., et al. v. ALEXANDER T. LICHAYTOO and CLIFFORD T.
LICHAYTOO
G.R. No. 193105, 30 May 2011, SECOND DIVISION, (Nachura, J.)
In determining probable cause, the average person weighs facts and circumstances without
resorting to the calibrations of the rules of evidence of which he has no technical knowledge. He relies
on common sense. A finding of probable cause does not require an inquiry as to whether there is
sufficient evidence to secure a conviction. It is enough that the act or omission complained of constitutes
the offense charged.
Raul Arambulo (Arambulo) and Adam E. Jimenez III (Jimenez) and Alexander T. Lichaytoo
and Clifford Lichaytoo are stockholders and incorporators of Clay & Feather International, Inc. (CFII),
a domestic corporation engaged in the business of marketing guns and ammunitions. Arambulo is
the President of CFII, while Jimenez is a member of the Board of Directors. On the other hand,
Alexander is the Corporate Secretary of CFII, while Clifford is its Chief Finance Officer/Treasurer.
In a complaint-affidavit dated April 4, 2008, Arambulo et al. charged the Lichaytoos before
the Office of the City Prosecutor with the crime of five counts of Qualified Theft. Arambulo et al.
alleged that sometime in February 2006 to November 2007, Lichaytoos, by virtue of their positions
in CFII and with grave abuse of confidence, intentionally, maliciously, and feloniously, with intent to
gain and to profit thereby, took several firearms owned by CFII without the knowledge and consent
of the corporation and its stockholders.
In their defense, Lichaytoos claim lack of probable cause since the complaint was merely a
harassment suit. In fact, according to them CFII does not have a Euro bank account in its name, and
that the corporation uses the Euro bank accounts of Lichaytoos wherein they deposited their
payment for the guns they acquired. Nonetheless, as to the opposing claims, when the issue of
probable cause reached the Court of Appeals (CA), the latter ruled in the affirmative. Hence, the
petition.
ISSUE:
Whether or not there is probable cause for the commission of qualified theft.
RULING:
YES. Probable cause, for purposes of filing a criminal information, has been defined as such
facts as are sufficient to engender a well-founded belief that a crime has been committed and that
respondent is probably guilty thereof, and should be held for trial. Probable cause is meant such set
of facts and circumstances, which would lead a reasonably discreet and prudent man to believe that
the offense charged in the Information, or any offense included therein, has been committed by the
person sought to be arrested. A finding of probable cause needs only to rest on evidence showing
that, more likely than not, a crime has been committed and that it was committed by the accused.
Probable cause demands more than bare suspicion, but it requires less than evidence that would
justify a conviction.
In the instant case, the affidavit-complaint and the pleadings filed with the Office of the City
Prosecutor sufficiently show all the elements of theft. The evidence on hand sufficiently shows that,
more likely than not, the crime of Qualified Theft has been committed and the same was committed
by Lichaytoos. There was unlawful taking by Lichaytoos of the subject firearms that incontestably
belonged to CFII. The taking was without the consent of the owner CFII and was accomplished
without the use of violence against or intimidation of persons or force upon things. Furthermore, the
subject firearms were taken with grave abuse of confidence in as much as Lichaytoos could not have
taken the subject firearms if not for the positions that they held in the company. This last
circumstance qualifies the offense charged. However, our pronouncement as to the existence of
probable cause does not delve into the merits of the case; neither do we pronounce that the evidence
is sufficient to secure a conviction.
GEORGE MILLER v. SECRETARY HERNANDO B. PEREZ

G.R. No. 165412, 30 May 2011, THIRD DIVISION, (Villarama, Jr., J.)
In a preliminary investigation, a full and exhaustive presentation of the parties evidence is not
required, but only such as may engender a well-grounded belief that an offense has been committed and
that the accused is probably guilty thereof. Certainly, it does not involve the determination of whether
or not there is evidence beyond reasonable doubt pointing to the guilt of the person. Only prima
facie evidence is required; or that which is, on its face, good and sufficient to establish a given fact, or
the group or chain of facts constituting the party's claim or defense; and which, if not rebutted or
contradicted, will remain sufficient. Therefore, matters of evidence, such as who are the conspirators,
are more appropriately presented and heard during the trial.
George Miller was stabbed inside the National Bilibid Prison after he sends letters to
authorities as to the persons involved in drug trade. Consequently, informations were filed pursuant
to the finding of probable cause to several suspects. Further, a certain Bernardino was later on
implicated based on several testimonies of those earlier charged. Bernardino, consequently opposed
the implication and charge arguing that there is no probable cause and the implications were merely
based on conjectures and suspicions. In addition, accordingly, there was considerable length of time
before the said affidavits were executed.
ISSUE:
Whether or not considerable length of time before affidavits implicating Bernardino negates
the existence of probable cause.
RULING:
NO. Probable cause is defined as the existence of such facts and circumstances as would excite
the belief in a reasonable mind, acting on the facts within the knowledge of the prosecutor, that the
person charged was guilty of the crime for which he was prosecuted. To determine the existence of
probable cause, there is need to conduct preliminary investigation. A preliminary investigation
constitutes a realistic judicial appraisal of the merits of a case. Its purpose is to determine whether
(a) a crime has been committed; and (b) whether there is a probable cause to believe that the accused
is guilty thereof. It is a means of discovering which person or persons may be reasonably charged
with a crime.
The term probable cause does not mean actual and positive cause nor does it import absolute
certainty. It is merely based on opinion and reasonable belief. Thus, a finding of probable cause does
not require an inquiry into whether there is sufficient evidence to procure a conviction. It is enough
that it is believed that the act or omission complained of constitutes the offense charged. Precisely,
there is a trial for the reception of evidence of the prosecution in support of the charge. Hence, the
testimonies and affidavits implicating Bernardino were enough to conclude the existence of probable
cause for the latter’s suspected act of being the mastermind.
JOSEPH ANTHONY M. ALEJANDRO, et. al v. ATTY. JOSE A. BERNAS, et al.

It is settled that the determination of whether probable cause exists to warrant the prosecution
in court of an accused should be consigned and entrusted to the DOJ, as reviewer of the findings of public
prosecutors. The courts duty in an appropriate case is confined to the determination of whether the
assailed executive or judicial determination of probable cause was done without or in excess of
jurisdiction or with grave abuse of discretion amounting to want of jurisdiction.
Joseph Anthony Alejandro (Alejandro) is the lessee-purchaser of a condominium unit of the

lessor-seller Oakridge Properties, Inc. (OPI). Alejandro sub-leased the Unit to Firdausi, et. al to be
used as a law office. However, a defect in the air-conditioning unit prompted the latter to suspend
payments until the problem is fixed by the management. Instead of addressing the defect, OPI
instituted an action for ejectment before the MeTC of Pasig City, against Alejandro for the latter’s
failure to pay rentals. Alejandro, for his part, interposed the defense of justified suspension of
payments.
During the pendency of the ejectment case, OPI, allegedly through Atty. Marie Lourdes Sia-
Bernas, ordered that the Unit be padlocked. In an Order, the MeTC directed OPI to remove the padlock
of the Unit and discontinue the inventory of the properties. The order was reiterated when the MeTC
issued a Temporary Restraining Order in favor of Alejandro. However, OPI, allegedly through Atty.
Jose Bernas, again padlocked the Unit and even cut off the electricity, water and telephone facilities.
The MeTC ruled in favor of Alejandro. The court found Alejandros suspension of payment
justified. The decision was, however, reversed and set aside by the Regional Trial Court (RTC) whose
decision was in turn affirmed by the CA. Alejandro, et.al then filed a criminal complaint for grave
coercion against Bernas, et.al with the Office of the City Prosecutor (OCP) of Pasig. The OCP held that
the latter could not be charged with grave coercion as no violence was employed by the by them in
padlocking the leased premises and cutting off of facilities; and that they may be held liable for unjust
vexation only. The appeal to the Secretary of Justice was dismissed. Undaunted, Alejandro, et.al
elevated the matter to the CA which not only recognized the DOJs authority to dismiss the petition
on technicality pursuant to its rules of procedure, but also found that there was no probable cause
for the crime of grave coercion. It held that the mere presence of the security guards was insufficient
to cause intimidation. The CA likewise denied the motion for reconsideration. Hence, this petition.
ISSUE:
Whether or not grave coercion can be committed through intimidation alone without
violence.
RULING:
NO. It is the policy of the courts to accord respect to the discretion granted to the prosecutor
and for reasons of practicality, the Court, as a rule, does not interfere with the prosecutors
determination of probable cause for otherwise, courts would be swamped with petitions to review
the prosecutors findings in such investigations. The courts duty in an appropriate case is confined to
the determination of whether the assailed executive or judicial determination of probable cause was
done without or in excess of jurisdiction or with grave abuse of discretion amounting to want of
jurisdiction.
The Court finds that the mere presence of the security guards is insufficient to cause
intimidation to the Alejandro, et.al. There is intimidation when one of the parties is compelled by a
reasonable and well-grounded fear of an imminent and grave evil upon his person or property, or
upon the person or property of his spouse, descendants or ascendants, to give his consent. Material
violence is not indispensable for there to be intimidation. Intense fear produced in the mind of the
victim which restricts or hinders the exercise of the will is sufficient.
As aptly held by the CA, it was not alleged that the security guards committed anything to
intimidate Alejandro, et. al, nor was it alleged that the guards were not customarily stationed there
and that they produced fear on the part of the latter. To determine the degree of the intimidation, the
age, sex and condition of the person shall be borne in mind. Here, Alejandro, et. al who were allegedly
intimidated by the guards are all lawyers who presumably know their rights. The presence of the
guards in fact was not found by them to be significant because they failed to mention it in their Joint
Affidavit-Complaint. What they insist is that, the mere padlocking of the Unit prevented them from
using it for the purpose for which it was intended. This, according to the Alejandro, et. al, is grave
coercion on the part of Bernas, et.al. In the crime of grave coercion, violence through material force
or such a display of it as would produce intimidation and, consequently, control over the will of the
offended party is an essential ingredient.
Warrantless Arrest
PEOPLE OF THE PHILIPPINES v. NG YIK BUN, et al.

G.R. No. 180452, 10 January 2011, FIRST DIVISION (Velasco, Jr., J.)
A police officer may effect an arrest without a warrant on the basis of Sec. 5(a), Rule 113 of the
Rules of Court, as the offense is deemed committed in his presence or within his view.
Capt. Danilo Ibon of Task Force Aduana received information from an operative that there
was an ongoing shipment of contraband in Barangay Bignay II, Sariaya, Quezon Province. Capt. Ibon
formed a team in coordination with a Philippine National Police detachment, and, along with the
operative, the team then proceeded to Villa Vicenta Resort in Barangay Bignay II, Sariaya. The
members of the team were able to observe the goings-on at the resort from a distance of around 50
meters. They spotted six Chinese-looking men, namely, Ng Yik Bun, Kwok Wai Cheng, Chang Chaun
Shi, Chua Shilou Hwan, Kan Shun Min and Raymond S. Tan (Ng Yik Bun, et. al), loading bags containing
a white substance into a white van. Having been noticed, Capt. Ibon identified his team and asked
Chua Shilou Hwan (Hwan) what they were loading on the van. Hwan replied that it was shabu and
pointed, when probed further, to Raymond Tan as the leader. A total of 172 bags of
suspected shabu were then confiscated. A laboratory report prepared later by Police Inspector Mary
Jean Geronimo on samples of the 172 confiscated bags showed the white substance to be shabu.
An Amended Information for violation of Sec. 16, Article III of RA 6425 was filed against Ng
Yik Bun, et. al, who entered a plea of not guilty upon re-arraignment. The Regional Trial Court (RTC)
convicted them of the crime charged. In questioning the RTC Decision before the Court of Appeals
(CA), Bun, Cheng, Shi, Min, and Tan raised the lone issue of: whether the trial court erred in ruling
that there was a valid search and arrest despite the absence of a warrant. The appellate court
affirmed in toto the RTC Decision. Hence, the petition.
ISSUE:
Whether there was a valid search and arrest despite the absence of a warrant.
RULING:
YES. A settled exception to the right guaranteed under Art. 3, Sec. 2 of the1987 Constitution
is that of an arrest made during the commission of a crime, which does not require a warrant. Such
warrantless arrest is considered reasonable and valid under Rule 113, Sec. 5(a) of the Revised Rules
on Criminal Procedure which refers to arrest in flagrante delicto. In the instant case, contrary to
accused-appellants contention, there was indeed a valid warrantless arrest in flagrante
delicto. Consider the circumstances immediately prior to and surrounding the arrest of accused-
appellants: (1) the police officers received information from an operative about an ongoing shipment
of contraband; (2) the police officers, with the operative, proceeded to Villa Vicenta Resort
in Barangay Bignay II, Sariaya, Quezon; (3) they observed the goings-on at the resort from a distance
of around 50 meters; and (4) they spotted the six accused-appellants loading transparent bags
containing a white substance into a white L-300 van.
Evidently, the arresting police officers had probable cause to suspect that accused-appellants
were loading and transporting contraband, more so when Hwan, upon being accosted, readily
mentioned that they were loading shabu and pointed to Tan as their leader. Thus, the arrest of
accused-appellants who were caught in flagrante delicto of possessing, and in the act of loading into
a white L-300 van, shabu, a prohibited drug under RA 6425, as amended is valid.
In People v. Alunday, we held that when a police officer sees the offense, although at a distance,
or hears the disturbances created thereby, and proceeds at once to the scene, he may effect an arrest
without a warrant on the basis of Sec. 5(a), Rule 113 of the Rules of Court, as the offense is deemed
committed in his presence or within his view. In the instant case, it can plausibly be argued that
accused-appellants were committing the offense of possessing shabu and were in the act of loading
them in a white van when the police officers arrested them. As aptly noted by the appellate court, the
crime was committed in the presence of the police officers with the contraband, inside transparent
plastic containers, in plain view and duly observed by the arresting officers. And to write finis to the
issue of any irregularity in their warrantless arrest, the Court notes, as it has consistently held, that
accused-appellants are deemed to have waived their objections to their arrest for not raising the
issue before entering their plea.
PEOPLE OF THE PHILIPPINES v. ERNESTO UYBOCO y RAMOS

G.R. No. 178039, 19 January 2011, FIRST DIVISION (Perez, J.)
A valid hot pursuit arrest necessitates two stringent requirements before a warrantless arrest
can be effected: (1) an offense has just been committed; and (2) the person making the arrest has
personal knowledge of facts indicating that the person to be arrested has committed it.
Nimfa Celiz (Celiz) and her wards, siblings Jeson Kevin and Jeson Kirby Dichaves, were taken
and brought to a house in Merville Subdivision, Paranaque. The kidnappers called Jepson Dichaves
(Jepson), the Nimfa's employer and the parent of the siblings, and asked for ransom in exchange for
the release of the captives. Both Celiz and Jepson were able to recognize the voice of the kidnapper,
as he had several business transactions with Jepson and they have talked several times over the past
four years.
When they finally agreed to the ransom amount, Ernesto Uyboco (Uyboco), the captor, asked
Jepson to bring the ransom alone at Pancake House in Magallanes Commerical Center. After receiving
the information, Jespon informed General Jewel Canson (Gen. Canson) and General Panfilo Lacson
(Gen. Lacson), and the two coordinated with the other police officers regarding the capture of
Uyboco. They assigned one group of police officers at the meeting place and one group of officers at
Fort Bonifacio, where Uyboco was expected to pass.
Uyboco arrived at the meeting place aboard a red Nissan vehicle. Two police officers were
assigned at the Magallanes Commerical Center to capture the pay-off on camera and video. Once
Uyboco got the bag with the ransom money from Jepson’s trunk, the former informed him where he
could find Celiz and his sons, before heading off. The police officers assigned to apprehend Uyboco
were informed that the red vehicle he was boarding was headed their way, and so they followed and
blocked the vehicle. They introduced themselves as police officers and accosted Uyboco.
Afterwards, Uyboco was charged with three counts of kidnapping with ransom. The Regional
Trial Court (RTC) and the Court of Appeals (CA) both found him guilty beyond reasonable doubt of
the crime charged.
ISSUE:
Whether or not Uyboco’s warrantless arrest was valid.
RULING:
YES. For a valid hot pursuit arrest, under Sec. 5 of Rule 113 of the Rules of Court, there are
two stringent requirements that must be met: (1) an offense has just been committed; and (2) the
person making the arrest has personal knowledge of facts indicating that the person to be arrested
has committed it.
In this case, the records show that both requirements are present in this case. The police
officers present in Magallanes Commercial Center were able to witness the pay-off which effectively
consummates the crime of kidnapping. They all saw Uyboco take the money from the car trunk of
Jepson. Such knowledge was then relayed to the other police officers stationed in Fort Bonifacio
where Uyboco was expected to pass by. For the second requisite, it is sufficient for the arresting team
that they were monitoring the pay-off for a number of hours long enough for them to be informed
that it was indeed Uyboco, who was the kidnapper. This is equivalent to personal knowledge based
on probable cause, because the Rules on Criminal Procedure does not require the arresting officers
to personally witness the commission of the offense with their own eyes.
Sufficiency of Information
PEOPLE OF THE PHILIPPINES v. ROBERT P. BALAO, et al.

G.R. No. 176819,26 January 2011, SECOND DIVISION (CARPIO, J.)
The fundamental test in determining the adequacy of the averments in an information is

whether the facts alleged, if hypothetically admitted, would establish the essential elements of the crime.
Matters extrinsic or evidence aliunde should not be considered.
On 5 March 2001, Ombudsman Prosecutor II Raul V. Cristoria filed with

the Sandiganbayan an information against respondents Robert P. Balao (Balao), Josephine
C. Angsico(Angsico), Virgilio V. Dacalos (Dacalos), Felicisimo F. Lazarte, Jr. (Lazarte, Jr.), Josephine T.
Espinosa, Noel A. Lobrido, and Arceo C. Cruz (Balao, et. al) for violation of Section 3(e) of Republic
Act No. 3019 (RA 3019), as amended. The Sandiganbayan found the 5 March 2001 information
inadequate, that the participation of each of the accused did not appear clear in the resolution, much
less in the Information. Assistant Special Prosecutor Niduaza filed with the Sandiganbayan a
memorandum recommending that the 5 March 2001 information be maintained.
Balao, et al. filed a motion to quash the information. The Sandiganbayan denied Lazarte’s
motion to quash but granted Balao, Angsico, and Dacalos motions. The Sandiganbayan finds that the
information with respect to Balao, Angsico and Dacalos, fail to state the acts or omissions of
Balao, Angsico and Dacalos with sufficient particularity so as to enable them to make a carefully
considered plea to the charges against them. The prosecution does not describe how
accused Balao, et al. may have known or when they became aware of the alleged anomalies, before
they allegedly caused payment to the alleged errant contractor. The said Memorandum states only
that they failed to enforce the contract against the alleged errant private contractor, which is not even
the act imputed against them in the information. Hence, the present petition.
ISSUE:
Whether or not the allegations in the information were adequate.
RULING:
YES. The fundamental test in determining the adequacy of the averments in an information
is whether the facts alleged, if hypothetically admitted, would establish the essential elements of the
crime. Matters extrinsic or evidence aliunde should not be considered.
The essential elements of Section 3(e) of RA 3019, as amended are as follows: (1) That the
accused are public officers or private persons charged in conspiracy with them; (2) That said public
officers committed the prohibited acts during the performance of their official duties or in relation to
their public positions; (3) That they caused undue injury to any party, whether the Government or a
private party; (4) That such injury was caused by giving unwarranted benefits, advantage or
preference to such parties; and (5) That the public officers acted with manifest partiality, evident bad
faith or gross inexcusable negligence.
Clearly, the allegations in the 5 March 2001 information, if hypothetically admitted, would
establish the essential elements of the crime. The information stated that (1) Balao, Lazarte,
Jr., Angsico, and Dacalos were the general manager, team head of the Visayas Management Office,
and Visayas division manager, respectively, of the National Housing Authority; (2) they committed
the prohibited acts in or about the month of March, 1992, while in the performance of their official
functions; (3) they caused undue injury to the Government in the amount of P232,628.35, supposedly
for the excavation and roadfilling works on the Pahanocoy Sites and Services Project in Bacolod City
despite the fact that no such works were undertaken; (4) they gave unwarranted benefits, advantage
and preference to accused Arceo C. Cruz and A.C. Construction and themselves; and (5) they acted
with deliberate intent, with manifest partiality and evident bad faith.
PEOPLE OF THE PHILIPPINES v. NOEL DION

It is clear from Section 11, Rule 110 of the Revised Rules of Criminal Procedure that the
requirement of indicating in the complaint or information the date of the commission of the offense
applies only when such date is a material ingredient of the offense.
Noel Dion (Dion) was accused of raping AAA, a minor, in two separate occasions. Thus, two
separate complaints were filed directly before the Regional Trial Court (RTC). The RTC convicted
Dion with two counts of statutory rape. On appeal, Dion questioned the second Information as
defective for its failure to state the exact, or at least the approximate, date the purported rape was
committed, thus, violating his constitutional right to be informed of the nature and cause of the
accusation against him. The Court of Appeals (CA), affirming the RTC Decision, upheld the validity of
the second complaint and held that in a prosecution for rape, the material fact or circumstance to be
considered is the occurrence of the rape, not the time of its commission.
ISSUE:
Whether or not the failure to state in the complaint the exact date the purported crime of rape
was committed warrants the acquittal of Dion.
RULING:
NO. It is clear from Section 11, Rule 110 of the Revised Rules of Criminal Procedure that the
requirement of indicating in the complaint or information the date of the commission of the offense
applies only when such date is a material ingredient of the offense. In People v. Cantomayor, the Court
explained when the time of the commission of the crime becomes relevant: “[T]he time of the
commission of the crime assumes importance only when it creates serious doubt as to the
commission of the rape or the sufficiency of the evidence for purposes of conviction. The date of the
commission of the rape becomes relevant only when the accuracy and truthfulness of the
complainant’s narration practically hinge on the date of the commission of the crime.”
Applying this principle in a statutory rape case, the Court held: “We have repeatedly held that
the date of the commission of rape is not an essential element of the crime. It is not necessary to state
the precise time when the offense was committed except when time is a material ingredient of the
offense. In statutory rape, time is not an essential element. What is important is that the information
alleges that the victim was a minor under twelve years of age and that the accused had carnal
knowledge of her, even if the accused did not use force or intimidation on her or deprived her of
reason.”
In the case at bar, it is clear that the prosecution’s evidence consisting of AAA’s credible and
straightforward testimony, and the certification from the Municipality of Rosales, Pangasinan Office
of the Municipal Civil Registrar as to AAA’s date of birth, are sufficient to sustain Dion’s
conviction. The defense raised by Dion, which consisted of an alibi with respect to the April 2001
incident and denial as regards the June 16, 2001 allegation, were not strong enough to create a doubt
on AAA’s credibility.
Prescription
PRESIDENTIAL AD HOC FACT-FINDING COMMITTEE ON BEHEST LOANS v. OMBUDSMAN

ANIANO A. DESIERTO, et al.
G.R. No. 135703, 15 April 2009, SECOND DIVISION, (Carpio Morales, J.)
It was well-nigh impossible for the State, the aggrieved party, to have known the violations of
R.A. No. 3019 at the time the questioned transactions were made because, as alleged, the public officials
concerned connived or conspired with the "beneficiaries of the loans." Thus, the Court agrees
that the prescriptive period for the offenses with which the respondents were
charged should be computed from the discovery of the commission thereof and not from the day of such
commission.
The Presidential Ad Hoc Fact Finding Committee on Behest Loans, represented by Orlando L.
Salvador filed a complaint against Panfilo O. Domingo, Conrado S. Reyes, Zosimo C. Malabanan, Jose
R. Tengco, Jr., Placido L. Mapa, Jr., Verden C. Dangilan, Armando T. Romualdez, Vilma S. Romualdez,
Juan L. Syquian, and Alfredo T. Romualdez, for violation of Section 3(e) and (g) of Republic Act (R.A.)
No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act.
The Ombudsman Aniano A. Desierto dismissed the complaint against Panfilo O. Domingo,
Conrado S. Reyes, Zosimo C. Malabanan, and Jose R. R. Tengco, Jr. arguing that prescription has
already intervened in the prosecution of the offenses charged. According to the Ombudsman the
reckoning period for purposes of prescription shall begin to run from the time the public instruments
came into existence. In the case at bar, the subject financial accommodations were entered into by
virtue of public documents during the period of 1975 to 1976 and for purposes of computing the
prescriptive period, the aforementioned principles in the Dinsay, Villalon and Sandiganbayan cases
will apply. Records show that the complaint was referred and filed with this Office on October 1, 1997
or after the lapse of more than twenty years from the violation of the law. Deducible therefore, the
offenses charged have already prescribed or forever barred by the Statute of Limitations.
ISSUE:
Whether or not prescription sets in.
RULING:
NO. As explained in Presidential Ad Hoc Fact-Finding Committee on Behest Loans v.

Ombudsman Desierto:
In cases involving violations of R.A. No. 3019 committed prior to the February
1986 EDSA Revolution that ousted President Ferdinand E. Marcos, we ruled that the
government as the aggrieved party could not have known of the violations at the time
the questioned transactions were made. Moreover, no person would have dared to
question the legality of those transactions. Thus, the counting of the prescriptive period
commenced from the date of discovery of the offense in 1992 after an exhaustive
investigation by the Presidential Ad Hoc Committee on Behest Loans.
Applying the foregoing settled rule, the counting of the prescriptive period commenced from
the discovery of the offenses in 1992 after an exhaustive investigation by the Committee. When the
complaint was filed in 1997 or after about five years, prescription had not set in.
Res Judicata
HON. WALDO Q. FLORES, et al. v. ATTY. ANTONIO F. MONTEMAYOR

G.R. No. 170146, 8 June 2011, SPECIAL THIRD DIVISION, (Villarama, Jr., J.)
Res Judicata in prison grey or Double jeopardy attaches only (1) upon a valid indictment, (2)
before a competent court, (3) after arraignment, (4) when a valid plea has been entered, and (5) when
the defendant was convicted or acquitted, or the case was dismissed or otherwise terminated without
the express consent of the accused. The Court has held that none of these requisites applies where the
Ombudsman only conducted a preliminary investigation of the same criminal offense against the
respondent public officer. The dismissal of a case during preliminary investigation does not constitute
double jeopardy, preliminary investigation not being part of the trial.
This is a motion for reconsideration from the Supreme Court’s Decision which found Atty.
Antonio Montemayor administratively liable for failure to declare in his 2001 and 2002 Sworn
Statement of Assets and Liabilities two expensive cars registered in his name, in violation of Section
7, Republic Act (R.A.) No. 3019 in relation to Section 8 (A) of R.A. No. 6713. According to Montemayor
he was subjected to two administrative/criminal Investigations equivalently resulting in violation of
his constitutional right against double jeopardy. Montemayor asserts that since the PAGC charge
involving non-declaration in his 2001 and 2002 SSAL was already the subject of investigation by the
Ombudsman, along with the criminal complaint for unexplained wealth, the former can no longer be
pursued without violating the rule on double jeopardy.
ISSUE:
Whether or not Montemayor was subjected to double Jeopardy.
RULING:
NO. The same wrongful act committed by the public officer can subject him to civil,
administrative and criminal liabilities. The Court held in Tecson v. Sandiganbayan:
It is a basic principle of the law on public officers that a public official or

employee is under a three-fold responsibility for violation of duty or for a wrongful act
or omission. This simply means that a public officer may be held civilly, criminally, and
administratively liable for a wrongful doing. Thus, if such violation or wrongful act
results in damages to an individual, the public officer may be held civilly liable to
reimburse the injured party. If the law violated attaches a penal sanction, the erring
officer may be punished criminally. Finally, such violation may also lead to suspension,
removal from office, or other administrative sanctions. This administrative liability is
separate and distinct from the penal and civil liabilities.
Dismissal of a criminal action does not foreclose institution of an administrative proceeding

against the same respondent, nor carry with it the relief from administrative liability. Res judicata did
not set in because there is no identity of causes of action. Moreover, the decision of the Ombudsman
dismissing the criminal complaint cannot be considered a valid and final judgment. On the criminal
complaint, the Ombudsman only had the power to investigate and file the appropriate case before
the Sandiganbayan.
Arraignment
SPOUSES ALEXANDER TRINIDAD and CECILIA TRINIDAD v. VICTOR ANG

G.R. No. 192898,31 January 2011, THIRD DIVISION (Brion, J.)
Section 11, Rule 116 of the Rules of Court limits the deferment of the arraignment to a period of
60 days reckoned from the filing of the petition with the reviewing office.
The Office of the City Prosecutor, Masbate City, issued a Resolution recommending the filing
of an information for Violation of Batas Pambansa Bilang 22 against the Trinidads. The Trinidads
filed with the Department of Justice (DOJ) a petition for review challenging this Resolution.
Meanwhile, the Office of the City Prosecutor filed before the MTCC an Information for Violation
of Batas Pambansa Bilang 22 against the Trinidads. The latter filed a Manifestation and Motion to
Defer Arraignment and Proceedings and Hold in Abeyance the Issuance of Warrants of Arrest praying,
among others, for the deferment of their arraignment in view of the pendency of their petition for
review before the DOJ. It was granted, but upon reconsideration, it ordered and set the arraignment
on September 10, 2009.
The Trinidads filed a petition for certiorari before the Regional Trial Court (RTC) but was
denied contending that the MTCC judge did not err in setting the arraignment of the Trinidads after
the lapse of one (1) year and ten (10) months from the filing of the petition for review with the DOJ.
After the amendment of the Rules on December 1, 2000, the Supreme Court applied the 60-day limit
on suspension of arraignment in case of a pendency of a petition for review with the DOJ.
ISSUE:
Whether or not the MTCC correctly proceeded with arraignment pending the appeal with the
DOJ.
RULING:
YES. While the pendency of a petition for review is a ground for suspension of the
arraignment, the Section 11, Rule 116 of the Rules of Court limits the deferment of the arraignment
to a period of 60 days reckoned from the filing of the petition with the reviewing office. It follows,
therefore, that after the expiration of said period, the trial court is bound to arraign the accused or to
deny the motion to defer arraignment.
In the present case, the Trinidads filed their petition for review with the DOJ on October 10,
2007. When the RTC set the arraignment of the petitioners on August 10, 2009, 1 year and 10 months
had already lapsed. This period was way beyond the 60-day limit provided for by the Rules.
Demurrer to Evidence
HON. JUDGE JESUS B. MUPAS, Presiding Judge, Regional Trial Court, Branch 112 and
CARMELITA F. ZAFRA, Chief Administrative Officer, DSWD v. PEOPLE OF THE PHILIPPINES
As a general rule, an order granting the accused’s demurrer to evidence amounts to an acquittal.
There are certain exceptions, however, as when the grant thereof would not violate the constitutional
proscription on double jeopardy.
Carmelita F. Zafra (Zafra) was Supply Officer V of the Department of Social Welfare and
Development (DSWD). She arranged for the withdrawal for replacement, of 200 cartons of Bear
Brand Powdered Milk that were nearing their expiry date, through DSWD personnel Marcelina
Beltran (Beltran) and Manuelito Roga (Roga). Zafra instructed Beltran to have someone from the
DSWD Property Division withdraw the 200 cartons of milk from the DSWD-Villamor Airbase Relief
Operation Center (DSWD-VABROC). Beltran relayed this instruction to Roga. On the appointed date,
however, no one from the Property Division arrived to pick up the milk cases. Instead, three
unidentified persons on board a four-wheeler truck came and hauled the 200 cases of milk. One of
the three persons who came to pick up the milk cases introduced herself to Roga as Ofelia Saclayan,
who turns out to be Zafra’s sister.
The Ombudsman also filed two Informations against the three for violating the Anti-Graft and
Corrupt Practices Act (R.A. 3019) and malversation under Article 217 of the Revised Penal Code.
Before the Regional Trial Court (RTC) and after the prosecution presented its evidence, Zafra filed a
Motion for Demurrer to Evidence because the prosecution failed to establish the elements of the
crime of malversation and that she violated R.A. 3019. The RTC granted the demurrer to evidence
and acquitted Zafra.
The Court of Appeals (CA) revoked and set aside the grant of Zafra’s demurrer to evidence,
finding Judge Jesus Mupas committed grave abuse of discretion through his grant of private
respondents demurrer, which consequently resulted in her acquittal.
ISSUE:
Whether or not the CA erred in revoking Zafra’s demurrer to evidence.
RULING:
NO. The lower court’s grant of the demurrer to evidence of Zafra was attended by grave abuse
of discretion. The prosecution’s evidence was, prima facie, sufficient to prove the criminal charges
filed against her for her inexcusable negligence, subject to the defense that she may present in the
course of a full-blown trial. The lower court improperly examined the prosecution’s evidence in the
light of only one mode of committing the crimes charged; that is, through positive acts. The appellate
court correctly concluded that the crime of malversation may be committed either through a positive
act of misappropriation of public funds or passively through negligence by allowing another to
commit such misappropriation.
As a general rule, an order granting the accused’s demurrer to evidence amounts to an

acquittal. There are certain exceptions, however, as when the grant thereof would not violate the
constitutional proscription on double jeopardy. For instance, this Court ruled that when there is a
finding that there was grave abuse of discretion on the part of the trial court in dismissing a criminal
case by granting the accused’s demurrer to evidence, its judgment is considered void.
In the instant case, having affirmed the CA finding grave abuse of discretion on the part of the
trial court when it granted Zafra’s demurrer to evidence, we deem its consequent order of acquittal
void.
GOODLAND COMPANY, INC. v. ABRAHAM CO andCHRISTINE CHAN

G.R. No. 196685,14 December 2011, SECOND DIVISION (CARPIO, J.)
A judgment of acquittal cannot be recalled or withdrawn by another order reconsidering the

dismissal of the case, nor can it be modified except to eliminate something which is civil or
administrative in nature. One exception to the rule is when the prosecution is denied due process of
law. Another exception is when the trial court commits grave abuse of discretion in dismissing a criminal
case by granting the accused’s demurrer to evidence.
Goodland Company, Inc. (Goodland) and Smartnet Philippines, Inc. (Smartnet) are part of the
Guy Group of Companies, owned and controlled by the family of Mr. Gilbert Guy. Goodland allowed
the use of its Makati property, by way of accommodation, as security to the loan facility
of Smartnet with Asia United Bank (AUB). Mr. Guy, Goodlands Vice President, was allegedly made to
sign a Real Estate Mortgage (REM) document in blank. Upon signing the REM, Mr. Guy delivered the
same to AUB together with the original owners copy of the TCT covering the Makati property. About
two (2) years thereafter, Goodland found out that the REM signed in blank by Mr. Guy has been
allegedly filled up or completed and annotated at the back of the title of the Makati property.
Thereafter, charge of falsification against Co and Chan was filed. After the prosecution formally
offered its evidence and rested its case, Co and Chan filed a Motion for Leave of Court to File Demurrer
to Evidence with attached Demurrer to Evidence claiming that the prosecution failed to substantiate
its claim that they are guilty of the crime charged. The MeTC granted the Demurrer to Evidence.
Goodland filed a petition under Rule 65 with the RTC. The RTC denied the petition.The CA affirmed.
ISSUE:
Whether the CA committed grave abuse of discretion in affirming the dismissal of the criminal
case on demurrer to evidence in complete disregard of material prosecution evidence which clearly
establishes Co and Chan’s criminal liability for falsification of public documents.
RULING:
NO. An order granting an accused’s demurrer to evidence is a resolution of the case on the
merits, and it amounts to an acquittal. Generally, any further prosecution of the accused after an
acquittal would violate the constitutional proscription on double jeopardy.It is settled that a
judgment of acquittal cannot be recalled or withdrawn by another order reconsidering the dismissal
of the case, nor can it be modified except to eliminate something which is civil or administrative in
nature. One exception to the rule is when the prosecution is denied due process of law. Another
exception is when the trial court commits grave abuse of discretion in dismissing a criminal case by
granting the accused’s demurrer to evidence.
However, the present case is replete with evidence to prove that the CA was correct in
denying Goodland’s certiorari on appeal. The CA made its decision after its careful examination of the
records of the case. The CA found that Guy signed the subject Real Estate Mortgage and was
authorized by the Board of Directors to do so, and none of Goodland’s witnesses have personal
knowledge of the circumstances of the discussions between Guy and Asia United Bank. Goodland,
however, failed to prove that (1) the subject Real Estate Mortgage was in blank at the time it was
submitted to Asia United Bank; (2) Co and Chan filled-in the blanks in the Real Estate Mortgage; and
(3) Guy did not appear before the notary public. It was with reason, therefore, that the CA declared
that the evidence for Goodland failed miserably in meeting the quantum of proof required in criminal
cases to overturn the constitutional presumption of innocence. Grave abuse of discretion may not be
attributed to a court simply because of its alleged misappreciation of evidence.
Motion for Reconsideration
ANTONIO LEJANO v. PEOPLE OF THE PHILIPPINES

G.R. No. 176389/G.R. No. 176864, 18 January 2011, EN BANC (Abad, J.)
A motion for reconsideration after an acquittal is possible but only on grounds which are
exceptional and narrow as when the court that absolved the accused gravely abused its discretion,
resulting in loss of jurisdiction, or when a mistrial has occurred.
The Court reversed the judgment of the Court of Appeals (CA) and acquitted the accused in
this case, Hubert Jeffrey P. Webb, Antonio Lejano, Michael A. Gatchalian, Hospicio Fernandez, Miguel
Rodriguez, Peter Estrada, and Gerardo Biong of the charges against them on the ground of lack of
proof of their guilt beyond reasonable doubt. Lauro G. Vizconde, an immediate relative of the victims,
asked the Court to reconsider its decision, claiming that it denied the prosecution due process of law;
seriously misappreciated the facts; unreasonably regarded Alfaro as lacking credibility; issued a
tainted and erroneous decision; decided the case in a manner that resulted in the miscarriage of
justice; or committed grave abuse in its treatment of the evidence and prosecution witnesses.
ISSUE:
Whether a judgment of acquittal can be reconsidered.
RULING:
NO. As a rule, a judgment of acquittal cannot be reconsidered because it places the accused
under double jeopardy. To reconsider a judgment of acquittal places the accused twice in jeopardy
of being punished for the crime of which he has already been absolved. There is reason for this
provision of the Constitution. In criminal cases, the full power of the State is ranged against the
accused. If there is no limit to attempts to prosecute the accused for the same offense after he has
been acquitted, the infinite power and capacity of the State for a sustained and repeated litigation
would eventually overwhelm the accused in terms of resources, stamina, and the will to fight.
Of course, on occasions, a motion for reconsideration after an acquittal is possible. But the
grounds are exceptional and narrow as when the court that absolved the accused gravely abused its
discretion, resulting in loss of jurisdiction, or when a mistrial has occurred. In any of such cases, the
State may assail the decision by special civil action of certiorari under Rule 65.
Here, although complainant Vizconde invoked the exceptions, he has been unable to bring his
pleas for reconsideration under such exceptions. For instance, he avers that the Court must ensure
that due process is afforded to all parties and there is no grave abuse of discretion in the treatment
of witnesses and the evidence. But he has not specified the violations of due process or acts
constituting grave abuse of discretion that the Court supposedly committed. His claim that the highly
questionable and suspicious evidence for the defense taints with serious doubts the validity of the
decision is, without more, a mere conclusion drawn from personal perception.
Newly Discovered Evidence
LENIDO LUMANOG et al. v. PEOPLE OF THE PHILIPPINES

G.R. NO. 182555, 8 FEBRUARY 2011, EN BANC, (VILLARAMA, JR., J.)
Newly discovered evidence must be one that could not, by the exercise of due diligence, have
been discovered before the trial in the court below.
Lenido Lumanog and Augusto Santos seek the reversal of their conviction for murder on
several grounds. One of which is the claimed lack of positive identification of them based on an
affidavit of Orencio G. Jurado, Jr. As to the affidavit of Jurado, Jr., the said affiant claimed that he had
a heated argument with Inspector Roger Castillo during one of the hearings before the trial court
because Inspector Castillo was urging him "to confirm that those arrested by the joint team of CID
and PARAK-DILG were exactly the same people/suspects described by the guards to which he firmly
declined". Jurado alleged that he was surprised to see the faces of the suspects flashed on TV several
days after Herbas and Alejo gave their statements at Camp Karingal because they did not fit the
description given by witnesses Herbas and Alejo.
ISSUE:
Whether or not the presentation of the affidavit of Jurado as to the identity of the accused
may be considered as newly discovered evidence.
RULING:
NO. Evidently, the accused seeks the introduction of additional evidence to support the
defense argument that there was no positive identification of the killers. To justify a new trial or
setting aside of the judgment of conviction on the basis of such evidence, it must be shown that the
evidence was "newly discovered" pursuant to Section 2,Rule 121 of the Revised Rules of Criminal
Procedure, as amended.
Evidence, to be considered newly discovered, must be one that could not, by the exercise of
due diligence, have been discovered before the trial in the court below. Movant failed to show that
the defense exerted efforts during the trial to secure testimonies from police officers like Jurado, or
other persons involved in the investigation, who questioned or objected to the apprehension of the
accused in this case. Hence, the belatedly executed affidavit of Jurado does not qualify as newly
discovered evidence that will justify re-opening of the trial and/or vacating the judgment. In any case,
we have ruled that whatever flaw that may have initially attended the out-of-court identification of
the accused, the same was cured when all the accused-appellants were positively identified by the
prosecution eyewitness during the trial.
Appeal
EDWARD GARRICK VILLENA and PERCIVAL DOROJA v. PEOPLE OF THE PHILIPPINES, et al.
G.R. No. 184091,31 January 2011, SECOND DIVISION (Nachura, J.)
While it is true that an appeal is perfected upon the mere filing of a notice of appeal and that
the trial court thereupon loses jurisdiction over the case, this principle presupposes that the party filing
the notice of appeal could validly avail of the remedy of appeal and had not lost standing in court.
Police Inspector (P/Insp.) Edward Garrick Villena and Police Officer 1 (PO1) Percival Doroja,
were indicted for the crime of robbery (extortion). Villena and Doroja failed to appear before the trial
court to adduce evidence in their defense. The Regional Trial Court (RTC) convicted them. During the
promulgation of judgment, they again failed to appear despite proper notices to them at their
addresses of record. The promulgation was made and the RTC issued warrants of arrest against them.
They subsequently filed their separate notices of appeal before the RTC. In the said notices, they
explained that they failed to attend the promulgation of judgment because they did not receive any
notice thereof because they were transferred to another police station. The RTC denied due course
to Villena and Doroja notices of appeal.
The Court of Appeals (CA) resolved to deny the same for failure to show prima facie evidence
of any grave abuse of discretion on the part of the RTC. Hence, this petition ascribing error to the CA
in dismissing their petition. They argue that the CA erred in upholding the RTC in its denial of their
respective notices of appeal since they already contained the required manifestation and information
as to the cause of their non-appearance on the scheduled promulgation on September 3, 2007, i.e.,
lack of notice.
ISSUE:
Whether or not the CA erred in upholding the RTC in its denial of their respective notices of
appeal.
RULING:
NO. While it is true that an appeal is perfected upon the mere filing of a notice of appeal and
that the trial court thereupon loses jurisdiction over the case, this principle presupposes that the
party filing the notice of appeal could validly avail of the remedy of appeal and had not lost standing
in court. In this case, Villena and Doroja have lost their standing in court by their unjustified failure
to appear during the trial and, more importantly, during the promulgation of judgment of conviction,
and to surrender to the jurisdiction of the RTC.
Notably, however, Villena and Doroja did not proffer any documentary and convincing proof
of their supposed transfer, not even to inform the court as to which police station they were
transferred. Villena and Doroja were duty bound to inform the RTC of their transfer, assuming its
truth, so that notices may be sent to their respective new mailing addresses. They were remiss in the
discharge of this responsibility.
Even if Villena and Doroja notices of appeal were given due course, the CA would only be
constrained to dismiss their appeal. This is because Villena and Doroja, who had standing warrants
of arrest but did not move to have them lifted, are considered fugitives from justice. Since it is safe to
assume that they were out on bail during trial, Villena and Doroja were deemed to have jumped bail
when they failed to appear at the promulgation of their sentence. Under Section 8, Rule 124 of the
Rules of Court, once an accused escapes from prison or confinement, jumps bail, as in this case, or
flees to a foreign country, he loses his standing in court. Unless he surrenders or submits to the
jurisdiction of the court, he is deemed to have waived any right to seek relief from the court.
JUDITH YU v. HON. ROSA SAMSON-TATAD and THE PEOPLE OF THE PHILIPPINES

G.R. No. 170979, 9 February 2011, THIRD DIVISION, (Brion, J.)
If the modes of appeal to the CA (in cases where the RTC exercised its appellate jurisdiction) and
to this Court in civil and criminal cases are the same, no cogent reason exists why the periods to appeal
from the RTC (in the exercise of its original jurisdiction) to the CA in civil and criminal cases under
Section 3 of Rule 41 of the 1997 Rules of Civil Procedure and Section 6 of Rule 122 of the Revised Rules
of Criminal Procedure should be treated differently.
In a May 26, 2005 decision, the Regional Trial Court (RTC) convicted Judith Yu (Yu) as
charged. Fourteen days later, or on June 9, 2005, Yu filed a motion for new trial with the RTC, alleging
that she discovered new and material evidence that would exculpate her of the crime for which she
was convicted. In an October 17, 2005 order, Judge Rosa Samson-Tatad denied Yu’s motion for new
trial for lack of merit.
On November 16, 2005, Yu filed a notice of appeal with the RTC, alleging that pursuant to our
ruling in Neypes v. Court of Appeals, she had a fresh period of 15 days from November 3, 2005, the
receipt of the denial of her motion for new trial, or up to November 18, 2005, within which to file a
notice of appeal.
On November 24, 2005, Judge Rosa Samson-Tatad ordered Yu to submit a copy of Neypes for
his guidance. Consequently, on December 8, 2005, the prosecution filed a motion to dismiss the
appeal for being filed 10 days late, arguing that Neypes is inapplicable to appeals in criminal cases.
ISSUE:
Whether or not the fresh period rule enunciated in Neypes applies to appeals in criminal
cases.
RULING:
YES. The right to appeal is not a constitutional, natural or inherent right it is a statutory
privilege and of statutory origin and, therefore, available only if granted or as provided by statutes.
In Neypes, the Court modified the rule in civil cases on the counting of the 15-day period within which
to appeal. The Court categorically set a fresh period of 15 days from a denial of a motion for
reconsideration within which to appeal.
While Neypes involved the period to appeal in civil cases, the Courts pronouncement of a
fresh period to appeal should equally apply to the period for appeal in criminal cases under Section
6 of Rule 122 of the Revised Rules of Criminal Procedure, for the following reasons: First, BP 129, as
amended, the substantive law on which the Rules of Court is based, makes no distinction between
the periods to appeal in a civil case and in a criminal case. Section 39 of BP 129 categorically states
that the period for appeal from final orders, resolutions, awards, judgments, or decisions of any
court in all cases shall be fifteen days counted from the notice of the final order, resolution, award,
judgment, or decision appealed from. When the law makes no distinction, this Court also ought not
to recognize any distinction. Second, the provisions of Section 3 of Rule 41 of the 1997 Rules of Civil
Procedure and Section 6 of Rule 122 of the Revised Rules of Criminal Procedure, though differently
worded, mean exactly the same. There is no substantial difference between the two provisions
insofar as legal results are concerned the appeal period stops running upon the filing of a motion for
new trial or reconsideration and starts to run again upon receipt of the order denying said motion
for new trial or reconsideration. It was this situation that Neypes addressed in civil cases. No reason
exists why this situation in criminal cases cannot be similarly addressed. Third, while the Court did
not consider in Neypes the ordinary appeal period in criminal cases under Section 6, Rule 122 of the
Revised Rules of Criminal Procedure since it involved a purely civil case, it did include Rule 42 of the
1997 Rules of Civil Procedure on petitions for review from the RTCs to the Court of Appeals, and Rule
45 of the 1997 Rules of Civil Procedure governing appeals by certiorari to this Court, both of which
also apply to appeals in criminal cases.
Clearly, if the modes of appeal to the CA (in cases where the RTC exercised its appellate
jurisdiction) and to this Court in civil and criminal cases are the same, no cogent reason exists why
the periods to appeal from the RTC (in the exercise of its original jurisdiction) to the CA in civil and
criminal cases under Section 3 of Rule 41 of the 1997 Rules of Civil Procedure and Section 6 of Rule
122 of the Revised Rules of Criminal Procedure should be treated differently.
JOEL GALZOTE y SORIAGA v. JONATHAN BRIONES and PEOPLE OF THE PHILIPPINES

G.R. No. 164682, 14 September 2011, SECOND DIVISION (Brion, J.)
As a rule, the denial of a motion to quash is an interlocutory order and is not appealable; an
appeal from an interlocutory order is not allowed under Section 1(b), Rule 41 of the Rules of Court.
Neither can it be a proper subject of a petition for certiorari which can be used only in the absence of an
appeal or any other adequate, plain and speedy remedy. The plain and speedy remedy upon denial of an
interlocutory order is to proceed to trial.
The prosecution filed an Information for robbery in an uninhabited place against Joel Galzote
(Galzote) before the Metropolitan Trial Court (MeTC). Galzote moved to quash the above information
by alleging that it was patently irregular and fatally flawed in form and in substance. The MeTC
denied the petitioners motion to quash. Likewise, the MeTC denied his motion for reconsideration.
Galzote went to the Regional Trial Court (RTC) via a petition for certiorari where he argued
that the MeTC committed grave abuse of discretion in not granting his motion to quash. The RTC
dismissed the petition and denied the subsequent motion for reconsideration. He then filed a petition
for certiorari before the Court of Appeals (CA) which dismissed the petition. The CA held that Galzote
lost his right to appeal when he failed to appeal within the 15-day reglementary period. Likewise, the
CA denied his motion.
Hence, the present petition for review on certiorari. Galzote claims that his recourse to a
petition for certiorari before the CA was proper. He argues that both the MeTC and the RTC
committed grave abuse of discretion when they denied his motion to quash.
ISSUE:
Whether or not a petition for certiorari under Rule 65 is proper in order to assail the dismissal
of a motion to quash the Information.
RULING:
NO. In the usual course of procedure, a denial of a motion to quash filed by the accused results
in the continuation of the trial and the determination of the guilt or innocence of the accused. If a
judgment of conviction is rendered and is appealed, the accused can then raise the denial of his
motion to quash not only as an error committed by the trial court but as an added ground to overturn
the latter’s ruling.
In this case, Galzote did not proceed to trial but opted to immediately question the denial of
his motion to quash via a special civil action for certiorari under Rule 65 of the Rules of Court.
As a rule, the denial of a motion to quash is an interlocutory order and is not appealable; an
appeal from an interlocutory order is not allowed under Section 1(b), Rule 41 of the Rules of Court.
Neither can it be a proper subject of a petition for certiorari which can be used only in the absence of
an appeal or any other adequate, plain and speedy remedy. The plain and speedy remedy upon denial
of an interlocutory order is to proceed to trial. Thus, a direct resort to a special civil action
for certiorari is an exception rather than the general rule, and is a recourse that must be firmly
grounded on compelling reasons.
ANSELMO DE LEON CUYO v. PEOPLE OF THE PHILIPPINES

G.R. No. 192164, 12 October 2011, SECOND DIVISION, (Sereno, J.)
The fresh period of 15 days is allowed within which to file a notice of appeal, counted from the
receipt of the order dismissing a motion for new trial or a motion for reconsideration.
Anselmo Cuyo (Cuyo) filed a complaint for illegal possession of firearms against Alejo Cuyo.
On 20 November 2003, Cuyo appeared before Judge Samuel H. Gaerlan with regard to the application
for a search warrant by the Criminal Investigation and Detective Group (CIDG) for the search of the
house of Alejo, and, in the course of the proceedings, made untruthful statements under oath. Alejo
filed a complaint for perjury against Cuyo in which Cuyo was found guilty beyond reasonable doubt
of the offense of perjury under Article 183 of the Revised Penal Code and sentenced him to
imprisonment of four (4) months and one (1) day to one (1) year.
Cuyo filed a Motion for Reconsideration of the Decision, but the motion was subsequently
denied. He subsequently filed a Motion for Probation. The MTCC denied Cuyo’s latter motion on the
ground that it had been filed beyond the reglementary period of fifteen (15) days as provided by
Section 4 of Presidential Decree No. 968, as amended, or the Probation Law of 1976. The Motion for
Probation was received by the court when the decision has already become Final and
Executory.
Cuyo filed a Petition under Rule 65 before the Regional Trial Court (RTC) alleging that the
MTCC had committed grave abuse of discretion amounting to lack or excess of jurisdiction when it
denied his Motion for Probation. He asserted that the fresh period rule should also be applied to
criminal cases. Cuyo prayed for a liberal construction and application of the rules. The RTC denied
the Petition and ruled that the application period had lapsed when Cuyo neither surrendered nor
filed a motion for leave to avail himself of the remedies under the Rules of Court. In addition, the RTC
ruled that Cuyo failed to implead private complainant AlejoCuyo in violation of Rule 65, Section 5.
This rule mandates that Cuyo should join as private respondent the person interested in sustaining
the proceedings of the court.
Cuyo filed the present Rule 45 Petition for Review, assailing the Order of the RTC. He contends
that the RTC erred in computing the 15-day period provided in the Probation Law; and in dismissing
the petition on procedural issues without determining whether Cuyo is entitled to avail himself of
the benefits of probation.
ISSUE:
Whether or not the RTC erred in computing the 15-day period provided in the Probation Law.
RULING:
NO. While it may be correct to say that Cuyo failed to comply with the rule cited in Rule 65,
Sec. 5, it would not be correct to dismiss the petition based on this provision. Rule 3, Sec. 11 states
that neither misjoinder nor non-joinder of parties is a ground for the dismissal of an action. Thus, the
trial court should have ordered Cuyo to add private complainant as a respondent to the case.
Nevertheless, we agree with the RTC that the Motion for Probation was filed out of time.
CIVIL PROCEDURE
Jurisdiction
M.A. JIMENEZ ENTERPRISES, INC., represented by CESAR CALIMLIM and LAILA BALOIS v. THE
HONORABLE OMBUDSMAN, JESUS P. CAMMAYO, et al.
It is well settled that the determination of probable cause against those in public office during a
preliminary investigation is a function that belongs to the Ombudsman. The Ombudsman is vested with
the sole power to investigate and prosecute, motu proprio or upon the complaint of any person, any act
or omission, which appears to be illegal, unjust, improper, or inefficient. It has the discretion to
determine whether a criminal case, given its attendant facts and circumstances, should be filed or not.
The Department of Public Works and Highways (DPWH) entered into a contract for the
proposed construction of the Baguio General Hospital (BGH) and Medical Center Building Phase I. An
excavation was made under the control and supervision of Proj. Engineer Arturo Santos.
Construction of a provisional slope protection measure in the construction and excavation area was
then started. Unfortunately, heavy rains triggered the collapse of the portion of the slope protection,
resulting in landslide. M.A. Jimenez Enterprise, Inc. (M.A. Jimenez) alleged that the slide caused cracks
in the house owned by it and prejudiced the integrity of the house. Thus, it complained about the
project to DPWH.
DPWH-CAR then submitted a memorandum to the DPWH Regional Director which stated
among other that the affected part of the lot claimed by the affected part of the lot claimed by M.A.
Jimenez is actually part of the BGH property. Royson subsequently proceeded to build reinforced
concrete slope protection, a grouted riprap, and a retaining wall for the compound. However, on June
8, 2000, when the reinforced concrete slope protection, grouted riprap, and retaining wall for the
compound were already substantially completed, the retaining wall of the BGHMC Project collapsed.
Asserting that its property was damaged as a result, M.A. Jimenez, through its
representatives, Cesar Calimlim and Laila Balois, filed an Affidavit-Complaint against Jesus Cammayo,
et al. before the Office of the Ombudsman. The Office of the Ombudsman dismissed the complaint
after finding no probable cause to hold any of the respondents.
ISSUE:
Whether or not Ombudsman acted with grave abuse of discretion or without jurisdiction in
dismissing the complaint against Jesus Cammayo, et al.
RULING:
NO. It is well-settled that the determination of probable cause against those in public office
during a preliminary investigation is a function that belongs to the Ombudsman. The Ombudsman is
vested with the sole power to investigate and prosecute, motu proprio or upon the complaint of any
person, any act or omission, which appears to be illegal, unjust, improper, or inefficient. It has the
discretion to determine whether a criminal case, given its attendant facts and circumstances, should
be filed or not.
The Court respects the relative autonomy of the Ombudsman to investigate and prosecute,
and refrains from interfering when the latter exercises such powers either directly or through the
Deputy Ombudsman, except when there is grave abuse of discretion. Indeed, the Ombudsman’s
determination of probable cause may only be assailed through certiorari proceedings before the
Court on the ground that such determination is tainted with grave abuse of discretion defined as such
capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. For there to be
a finding of grave abuse of discretion, it must be shown that the discretionary power was exercised
in an arbitrary or despotic manner by reason of passion or personal hostility, and the abuse of
discretion must be so patent and gross as to amount to an evasion of a positive duty or to a virtual
refusal to perform the duty enjoined or to act in contemplation of law.
In this case however, an assiduous examination of the records, as well as the assailed
resolution and order of the Ombudsman dismissing the case against all the respondents for
insufficiency of evidence, shows that the Ombudsman did not act with grave abuse of discretion.
PEOPLE OF THE PHILIPPINES v. LUIS J. MORALES

G.R. No. 166355, 30 May 2011, THIRD DIVISION (Brion, J.)
Since Expocorp is a private corporation, not a government-owned or controlled corporation,

Morales, as Expocorp's president who now stands charged for violating Section 3(e) of R.A. No. 3019 in
this capacity, is beyond the Sandiganbayan's jurisdiction.
On June 13, 1991, then President Corazon Aquino issued Administrative Order No. 223 to
commemorate the 100th anniversary of the declaration of Philippine Independence and thereby
created the Committee for the National Centennial Celebrations in 1998. In 1993, then President
Fidel V. Ramos issued Executive Order No. 128 (EO 128) which renamed the Committee as the
"National Centennial Commission" (NCC).
The Philippine Centennial project was marred by numerous allegations of anomalies, among
them, the lack of public biddings. In 1998, Senator Ana Dominique Coseteng delivered a privilege
speech in the Senate denouncing these anomalies. Because of this speech, the Senate Blue Ribbon
Committee conducted an investigation on the Philippine Centennial project. In 1999, then President
Joseph Estrada created the Ad Hoc and Independent Citizen's Committee (AHICC), also for the
purpose of investigating these alleged anomalies. Both the Senate Blue Ribbon Committee and the
AHICC recommended to the Office of the Ombudsman that a more exhaustive investigation of the
Philippine Centennial project be conducted.
The investigation that followed resulted in the filing in 2001 of an Information by the
Ombudsman's Fact-Finding and Investigation Bureau against respondent Luis J. Morales (Morales),
the acting president of Expocorp at the time relevant to the case. The Information against Morales
was for violation of Section 3(e) of Republic Act (R.A.) No. 3019. Morales questioned the jurisdiction
of Sandiganbayan over his case. However, the Sandiganbayan after considering the arguments of the
parties ruled that the position of a president of a government-owned or controlled corporation
clearly falls within its jurisdiction.
ISSUE:
Whether or not the contention that Expocorpo was an extension of the NCC, hence within the
jurisdiction of Sandiganbayan is tenable.
RULING:
NO. Expocorp is a private corporation as found by the Sandiganbayan. It was not created by
a special law but was incorporated under the Corporation Code and was registered with the
Securities and Exchange Commission. It is also not a government-owned or controlled corporation.
A government-owned or controlled corporation must be owned by the government, and in the case
of a stock corporation, at least a majority of its capital stock must be owned by the government.
Meanwhile, Section 5, Article XIII of the 1973 Constitution defines the jurisdiction of the
Sandiganbayan:
Sec. 5. The [BatasangPambansa] shall create a special court, to be known as

Sandiganbayan, which shall have jurisdiction over criminal and civil cases involving graft
and corrupt practices and such other offenses committed by public officers and
employees, including those in government-owned or controlled corporations, in relation
to their office as may be determined by law.
Since Expocorp is a private corporation, not a government-owned or controlled corporation,

Morales, as Expocorp's president who now stands charged for violating Section 3(e) of R.A. No. 3019
in this capacity, is beyond the Sandiganbayan's jurisdiction.
HOME GUARANTY CORPORATION v. R-II BUILDERS INC. AND NATIONAL HOUSING

AUTHORITY
G.R. No. 192649, 22 June 2011, SPECIAL FIRST DIVISION (Perez, J.)
Jurisdiction, once acquired, cannot be easily ousted, it is equally settled that a court acquires
jurisdiction over a case only upon the payment of the prescribed filing and docket fees.
Two contentions are raised before the Supreme Court: (a) the Entry of Appearance filed by
Atty. Lope E. Feble of the Toquero Exconde Manalang Feble Law Offices as collaborating counsel for
respondent R-II Builders, Inc. (R-II Builders), with prayer to be furnished all pleadings, notices and
other court processes at its given address; and (b) the motion filed by R-II Builders, seeking the
reconsideration of Court's decision dated 9 March 2011.
In urging the reversal of the Court's decision, R-II Builders argues that it filed its complaint
with the Manila RTC which is undoubtedly vested with jurisdiction over actions where the subject
matter is incapable of pecuniary estimation; that through no fault of its own, said complaint was
raffled to Branch 24, the designated Special Commercial Court (SCC) tasked to hear intra-corporate
controversies; that despite the determination subsequently made by Branch 24 of the Manila RTC
that the case did not involve an intra-corporate dispute, the Manila RTC did not lose jurisdiction over
the same and its Executive Judge correctly directed its re-raffling to Branch 22 of the same Court; that
the re-raffle and/or amendment of pleadings do not affect a court's jurisdiction which, once acquired,
continues until the case is finally terminated; that since its original Complaint, Amended and
Supplemental Complaint and Second Amended Complaint all primarily sought the nullification of the
Deed of Assignment and Conveyance (DAC) transferring the Asset Pool in favor of petitioner Home
Guaranty Corporation (HGC), the subject matter of the case is clearly one which is incapable of
pecuniary estimation; and, that the court erred in holding that the case was a real action and that it
evaded the payment of the correct docket fees computed on the basis of the assessed value of the
realties in the Asset Pool.
ISSUE:
Whether or not the lower court erred in ruling that the correct docket fees were not paid.
RULING:
NO. Even then, the question of the Manila RTC's jurisdiction over the case is tied up with R-II
Builder's payment of the correct docket fees, which should be paid in full upon the filing of the
pleading or other application which initiates an action or proceeding. While it is, consequently, true
that jurisdiction, once acquired, cannot be easily ousted, it is equally settled that a court acquires
jurisdiction over a case only upon the payment of the prescribed filing and docket fees. Already
implicit from the filing of the complaint in the City of Manila where the realties comprising the Asset
Pool are located, the fact that the case is a real action is evident from the allegations of R-II Builders'
original Complaint, Amended and Supplemental Complaint and Second Amended Complaint which
not only sought the nullification of the DAC in favor of HGC but, more importantly, prayed for the
transfer of possession of and/or control of the properties in the Asset Pool. Its current protestations
to the contrary notwithstanding, no less than R-II Builders - in its opposition to HGC's motion to
dismiss - admitted that the case is a real action as it affects title to or possession of real property or
an interest therein. Having only paid docket fees corresponding to an action where the subject matter
is incapable of pecuniary estimation, R-II Builders cannot expediently claim that jurisdiction over the
case had already attached.
LAND BANK OF THE PHILIPPINES v. HEIRS OF SEVERINO LISTANA

G.R. No. 182758, May 30, 2011, SECOND DIVISION, (Carpio, J.)
The DARAB’s decision setting the amount of just compensation is merely preliminary and not
executory if challenged before the SAC. Execution pending "appeal" of the DARAB decision is allowed
only on meritorious grounds. Even then, it is the SAC, not the DARAB, that can grant execution pending
"appeal" because the SAC has original and exclusive jurisdiction over just compensation cases.
The Department of Agrarian Reform Adjudication Board (DARAB) commenced a summary

administrative proceedings to determine the amount of just compensation of Severino Listana’s
(Listana) property, wherein DARAB set the amount at P10,956,963.25 and ordered Land Bank of the
Philippines (LBP) to pay Listana the same. Thereafter, the Provincial Agrarian Reform Adjudicator
(PARAD) issued a writ of execution ordering Land Bank Manager and Agrarian Operations Center
Head Alex A. Lorayes (Lorayes) to pay Listana. Lorayes refused. Thus, Listana filed with the PARAD a
motion for contempt against Lorayes. Thereafter, LBP filed with the Regional Trial Court acting as
Special Agrarian Court (SAC), a petition for judicial determination of the amount of just compensation
for the property. LBP challenged the amount set by the DARAB and prayed that the amount be fixed
at P5,871,689.03.
Lorayes was cited in contempt. In its 25 October 2000 Order, the SAC dismissed LBP’s petition
for judicial determination of the amount of just compensation for the property. LBP appealed the 25
October 2000 Order.PARAD ordered the issuance of an alias writ of execution, ordering LBP to pay
Listana P10,956,963.25. The PARAD granted Listana’s motion for contempt. In its 20 August 2000
Order, the PARAD cited Lorayes for indirect contempt and ordered his imprisonment until he
complied with the DARAB’s 14 October 1998 Decision. In its 25 October 2000 Order, the SAC
dismissed LBP’s petition for judicial determination of the amount of just compensation for the
property. LBP appealed the 25 October 2000 Order. In its 27 November 2000 Resolution, the PARAD
ordered the issuance of an alias writ of execution, ordering LBP to pay Listana P10,956,963.25. On 3
January 2001, the PARAD issued a warrant of arrest against Lorayes.
LBP filed with the Regional Trial Court (RTC) a petition for injunction with application for the
issuance of a writ of preliminary injunction enjoining PARAD from implementing the warrant of
arrest against Lorayes. In its 29 January 2001 Order, the RTC enjoined the PARAD from implementing
the warrant of arrest pending final determination of the amount of just compensation for the
property. LBP posted a P5,644,773.02 cash bond.
ISSUE:
Whether or not the DARAB can grant execution pending appeal.
RULING:
NO. The SAC has original and exclusive jurisdiction over petitions for determination of the
amount of just compensation of properties acquired under RA No. 6657. Administrative agencies
have no jurisdiction over just compensation cases. Section 57 of RA No. 6657 states that, "The Special
Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the determination
of just compensation to landowners.” As a rule, the DARAB’s decision setting the amount of just
compensation is merely preliminary and not executory if challenged before the SAC. Execution
pending "appeal" of the DARAB decision is allowed only on meritorious grounds. Even then, it is the
SAC, not the DARAB, that can grant execution pending "appeal" because the SAC has original and
exclusive jurisdiction over just compensation cases. The determination of the amount of just
compensation is a judicial function that cannot be usurped by administrative agencies. In Apo Fruits
Corporation v. Court of Appeals, the Court held that:
It is now settled that the valuation of property in eminent domain is essentially a judicial
function which is vested with the RTC acting as Special Agrarian Court. The same cannot be lodged
with administrative agencies and may not be usurped by any other branch or official of the
government. In the present case, LBP filed with the SAC a petition for determination of the amount
of just compensation on 6 September 1999. The PARAD issued the alias writ of execution and warrant
of arrest on 27 November 2000 and 3 January 2001, respectively. The writ of execution and warrant
of arrest were invalid because the 14 October 1998 Decision of the DARAB setting the amount at
P10,956,963.25 was merely preliminary and not executory.
In any event, the Court has reinstated the 29 January 2001 Order of the RTC enjoining the
PARAD from implementing the warrant of arrest pending final determination of the amount of just
compensation for the property. Land Bank of the Philippines v. Listana, Sr. has long become final and
executory and can no longer be disturbed.
SPS EULOGIA & RAMON MANILA v. SPS EDERLINDA &DANIEL MANZO

G.R. No. 163602, 7 September 2011, FIRST DIVISION (VILLARAMA, JR., J.)
Lack of jurisdiction as a ground for annulment of judgment refers to either lack of jurisdiction
over the person of the defending party or over the subject matter of the claim. Thus, petitioner must
show not merely an abuse of jurisdictional discretion but an absolute lack of jurisdiction. Lack of
jurisdiction means absence of or no jurisdiction; that is, the court should not have taken cognizance of
the petition because the law does not vest it with jurisdiction over the subject matter.
The controversy stemmed from an action for ejectment filed by the Sps. Manzo, against the
Sps. Manila, before the Metropolitan Trial Court (MeTC) of Las Pinas City which ruled in favor of the
Sps. Manzo.
On appeal, the Regional Trial Court (RTC) reversed and set aside the MeTC decision. Sps. Manzo
filed a motion for reconsideration which the RTC denied for having been filed beyond the fifteen (15)-
day period. Consequently, the actual decision became final and executory.
Thereafter, Sps. Manzo filed a petition for annulment of the RTC decision in the Court of Appeals (CA).
By Decision, the CA granted the petition, annulled the RTC decision and reinstated the MeTC decision.
With the denial of their motion for reconsideration, Sps, Manila filed the present petition.
ISSUE:
Whether or not the CA erred in annulling the judgment of the RTC on the ground of lack of
jurisdiction when it has not even been shown that the RTC had no jurisdiction over the person of Sps.
Manzo or the subject matter of the claim.
RULING:
YES. Lack of jurisdiction as a ground for annulment of judgment refers to either lack of
jurisdiction over the person of the defending party or over the subject matter of the claim. Thus,
petitioner must show not merely an abuse of jurisdictional discretion but an absolute lack of
jurisdiction. Lack of jurisdiction means absence of or no jurisdiction; that is, the court should not have
taken cognizance of the petition because the law does not vest it with jurisdiction over the subject
matter.
There is no dispute that the RTC is vested with appellate jurisdiction over ejectment cases
decided by the MeTC, MTC or MCTC. We note that Sps. Manila’s attack on the validity of the RTC
decision pertains to a relief erroneously granted on appeal. While the court in an ejectment case may
delve on the issue of ownership or possession de jure solely for the purpose of resolving the issue of
possession de facto, it has no jurisdiction to settle with finality the issue of ownership and any
pronouncement made by it on the question of ownership is provisional in nature.
In this case, the RTC acted in excess of its jurisdiction in deciding the appeal of Sps. Manzo
when it ordered the Sps. Manzo to execute a deed of absolute sale in favor of the Sps. Manila. Such
erroneous grant of relief, however, is but an exercise of jurisdiction by the RTC. Jurisdiction is not the
same as the exercise of jurisdiction. As distinguished from the exercise of jurisdiction, jurisdiction is
the authority to decide a cause, and not the decision rendered therein. Thus, while Sps. Manzo
assailed the content of the RTC decision, they failed to show that the RTC did not have the authority
to decide the case on appeal. The CA therefore erred in annulling the RTC decision on the ground of
lack of jurisdiction as said court had jurisdiction to take cognizance of the appeal.
Actions affecting title to or possession of real property or an interest therein (real actions) shall
be commenced and tried in the proper court that has territorial jurisdiction over the area where the
real property or any part thereof is situated. A petition for the cancellation of a Transfer Certificate of
Title involving real property is a real action.
Republic of the Philippines is the registered owner of two (2) parcels of land known as the
Tala Estate. Under Proclamation No. 843, a portion of the Tala Estate was reserved for housing,
resettlement sites and related purposes by the government under the supervision and
administration of the National Housing Authority (NHA).On the other hand, Sps. Guilalas, are the
registered owners of a parcel of land located in San Jose Del Monte, Bulacan.
Eventually, the NHA started the development of the portion of the Tala Estate. However, Sps.
Guilalas resisted the development of the area claiming that a portion of their land was encroached
upon by the government. After an investigation was by NHA, it was found that the land owned by the
Sps. Guilalas was part and parcel of the Tala Estate.Thus, the Republic filed a Complaint for
Cancellation of Title them. In their Answer, Sps. Guilalas claimed that the RTC of Caloocan City had
no jurisdiction over the case since their lot is situated in Bulacan. Further, they maintained that they
have been in open, adverse and continuous possession of the subject lot since birth and have been
actually tilling the same in the concept of an owner.
After trial, the Regional Trial Court (RTC) rendered a Decision in favor of the Sps. Guilalas.
The Republic, through the Office of the Solicitor General (OSG), sought recourse before the CA. The
CA concluded that based on the evidence, it is apparent that Sps. Guilalas’ lot is beyond the
boundaries of the Tala Estate. Thus, outside the jurisdiction of the RTC Caloocan City. Hence, this
petition.
ISSUE:
Whether or not the RTC of Caloocan has jurisdiction over the Republic’s petition to cancel
Sps. Guilalas’ TCT over the latter’s lot situated in Bulacan.
RULING:
YES. At the outset, the Republic primarily sought the cancellation of Sps. Guilalas’ TCT over
the lot in question, which is clearly a real action. Section 1, Rule 14 of the 1997 Rules of Civil
Procedure provides that actions affecting title to or possession of real property or an interest therein
(real actions) shall be commenced and tried in the proper court that has territorial jurisdiction over
the area where the real property or any part thereof is situated. Considering that the lot in question
was not within the territorial jurisdiction of RTC of Caloocan City, it was but proper for the RTC to
have dismissed the complaint.
ATTY. MARIETTA D. ZAMORANOS v. PEOPLE OF THE PHILIPPINES et al.

G.R. No. 193902, 1 June 2011, SECOND DIVISION, (Nachura, J.)
True, the Sharia Circuit Court is not vested with jurisdiction over offenses penalized under the
RPC. Nonetheless, it must be pointed out that even in criminal cases, the trial court must have
jurisdiction over the subject matter of the offense.
On May 3, 1982, Marietta Zamoranos (Zamoranos) wed Jesus De Guzman (De Guzman), a
Muslim convert, in Islamic rites. Prior thereto, Zamoranos was a Roman Catholic who had converted
to Islam on April 28, 1982. Subsequently, on July 30, 1982, the two wed again, this time, in civil rites
before Judge Perfecto Laguio of the RTC, Quezon City.A little after a year, on December 18, 1983,
Zamoranos and De Guzman obtained a divorce by talaq. The dissolution of their marriage was
confirmed by the Sharia Circuit District Court.
Zamoranos married anew on December 20, 1989. As she had previously done in her first
nuptial to De Guzman, Zamoranos wed Samson Pacasum, Sr. (Pacasum) under Islamic rites. However,
despite having three children, the relationship between Zamoranos and Pacasum turned sour and, in
1998, the two were de facto separated. Pacasum filed a flurry of cases against Zamoranos such as:
Petition for Declaration of a Void Marriage on account of Zamoranos alleged previous marriage with
de Guzman; and Criminal complaint for Bigamy.
As to the civil case for declaration of Void marriage the trial court rendered a decision in favor
of Zamoranos, dismissing the petition of Pacasum for lack of jurisdiction. As to the criminal case for
Bigamy however, the RTC refused to acknowledge the civil case decision dismissing the declaration
for void marriage filed by Pacasum and instead proceeded to the case. Consequently, Zamoranos filed
for the quashal of the information which was denied. Thus, Zamoranos filed a petition
for certiorari for the nullification of the order of the RTC.
ISSUE:
Whether or not the RTC gravely abused its discretion when it failed to similarly dismissed the
case for bigamy notwithstanding the decision of the other RTC dismissing the petition for declaration
of Void marriage on account of valid divorce by Talaq between Zamoranos and de Guzman.
RULING:
YES. Albeit generally, a special civil action for certiorari and prohibition is not the proper
remedy to assail the denial of a motion to quash an information. Under exceptional circumstances
the RTC, which heard the case for Bigamy, should have taken cognizance of the categorical
declaration of the RTC handling the civil case that Zamoranos is a Muslim, whose first marriage to
another Muslim, De Guzman, was valid and recognized under Islamic law. In fact, the same court
further declared that Zamoranos divorce from De Guzman validly severed their marriage ties.
True, the Sharia Circuit Court is not vested with jurisdiction over offenses penalized under
the RPC. Nonetheless, it must be pointed out that even in criminal cases, the trial court must have
jurisdiction over the subject matter of the offense. In this case, the charge of Bigamy hinges on
Pacasums claim that Zamoranos is not a Muslim, and her marriage to De Guzman was governed by
civil law. This is obviously far from the truth, and the fact of Zamoranos Muslim status should have
been apparent.
One of the effects of irrevocable talaq, as well as other kinds of divorce, refers to severance of
matrimonial bond, entitling one to remarry. Therefore, the first Marriage between Marietta
Zamoranos and Jesus de Guzman having been entered first under Muslim Rites albeit with a
subsequent civil wedding rightfully puts it under the coverage of the Muslim code in which divorce
by Talaq is recognized. Hence, it stands to reason that Zamoranos divorce from De Guzman, as
confirmed by an Ustadz and Judge Jainul of the Sharia Circuit Court, and attested to by Judge Usman,
was valid, and, thus, entitled her to remarry Pacasum in 1989. Consequently, the RTC, handling the
criminal case is without jurisdiction to try Zamoranos for the crime of Bigamy.
ATIKO TRANS, INC and CHENG LIE NAVIGATION CO., LTD. v. PRUDENTIAL GUARANTEE AND
ASSURANCE, INC.
G.R. No. 167545, 17 August 2011, FIRST DIVISION, (Del Castillo, J)
Where service of summons upon the defendant principal is coursed thru its co-defendant agent, and the
latter happens to be a domestic corporation, the rules on service of summons upon a domestic private juridical
entitymust be strictly complied with. Otherwise, the court cannot be said to have acquired jurisdiction over the
person of both defendants.
On December 11, 1998, 40 coils of electrolytic tinplates were loaded on board M/S Katjana
in Kaohsiung, Taiwan for shipment to Manila. The shipment was covered by Bill of Lading issued by
Cheng Lie Navigation Co., Ltd. with Oriental Tin Can & Metal Sheet Manufacturing Co., Inc. as the
notify party. The cargoes were insured against all risks via insurance issued by Prudential Guarantee
and Assurance, Inc. Upon discharge of the cargoes, it was found that one of the tinplates was
damaged, crumpled and dented on the edges. The sea van in which it was kept during the voyage was
also damaged, presumably while still on board the vessel and during the course of the voyage.
Oriental then filed its claim against the policy. Satisfied that Orientals claim was compensable,
Prudential paid Oriental P205, 220.97 representing the amount of losses it suffered due to the
damaged cargo.
Prudential filed with the MeTC of Makati City a Complaint for sum of money against Cheng
Lie and Atiko Trans, Inc. The MeTC rendered its judgment by default declaring Cheng Lie and Atiko
solidarily liable to pay Prudential. Atiko then filed a Notice of Appeal. The RTC rendered its Decision
dismissing the appeal and affirming the Decision of the MeTC. The CA likewise affirmed the decision
of the MeTC.
ISSUES:
1. Whether the decision of the MeTC is null and void for failure to acquire jurisdiction over the
person of Atiko considering that the summons were not properly served on them.
2. Whether the decision of the MeTC is null and void for failure to acquire jurisdiction over the
person of Cheng Lie considering that the summons were not properly served on them.
RULINGS:
1. NO. MeTC properly acquired jurisdiction over the person of Atiko. When the defendant is
a domestic corporation, service of summons may be made only upon the persons enumerated in
Section 11, Rule 14 of the Rules of Court. However, jurisdiction over the person of the defendant can
be acquired not only by proper service of summons but also by defendants voluntary appearance
without expressly objecting to the court’s jurisdiction, as embodied in Section 20, Rule 14 of the Rules
of Court.
In the case at bench, when Atiko filed its Notice of Appeal, Memorandum of Appeal Motion
for Reconsideration of the April 8, 2003 Decision of the RTC, and Petition for Review, it never
questioned the jurisdiction of the MeTC over its person. The filing of these pleadings seeking
affirmative relief amounted to voluntary appearance and, hence, rendered the alleged lack of
jurisdiction moot.
2. YES. As it was amended by A.M. No. 11-3-6-SC, Section 12 of Rule 14 of the Rules of Court,
when the defendant is a foreign juridical entity, service of summons may be made upon: Its resident
agent designated in accordance with law for that purpose; the government official designated by law
to receive summons if the corporation does not have a resident agent; or, any of the corporations
officers or agents within the Philippines.
Summons was served upon Cheng Lie in any manner prescribed above. It should be recalled
that Atiko was not properly served with summons as the person who received it on behalf of Atiko,
is its cashier who is not one of the corporate officers enumerated in Section 11 of Rule 14 of the Rules
of Court. The MeTC acquired jurisdiction over the person of Atiko not thru valid service of summons
but by the latter’s voluntary appearance. Thus, there being no proper service of summons upon Atiko
to speak of, it follows that the MeTC never acquired jurisdiction over the person of Cheng Lie. To rule
otherwise would create an absurd situation where service of summons is valid upon the purported
principal but not on the latter’s co-defendant cum putative agent despite the fact that service was
coursed thru said agent. Indeed, in order for the court to acquire jurisdiction over the person of a
defendant foreign private juridical entity under Section 12, Rule 14 of the Rules of Court, there must
be prior valid service of summons upon the agent of such defendant.
Small Claims
ERNESTO Z. ORBE v. JUDGE MANOLITO Y. GUMARANG

A.M. No. MTJ-11-1792, 26 September 2011, THIRD DIVISION, (Peralta, J.)
The exigency of prompt rendition of judgment in small claims cases is a matter of public policy.
Ernesto Z. Orbe (Orbe), the plaintiff in a small claim case, filed an administrative case against
Judge Manolito Y. Gumarang (Judge Gumarang), the Pairing Judge, Municipal Trial Court (MTC), Imus,
Cavite for Violation of the Rule of Procedure for Small Claims Cases and the Code of Judicial Conduct.
Orbe alleged that the Judge Gumarang violated the Rule of Procedure for Small Claims Cases for
failure to decide the civil case within five (5) days from receipt of the order of reassignment. In sum,
it took Judge Gumarang more than two (2) months to render a decision on the subject case due to the
series of postponements which occurred during the pendency of the case.
For his part, Judge Gumarang pointed out that the Rule needed clarification since, as in his
case, the five (5) working days should be construed to refer to five (5) calendared trial dates falling
on Thursdays only, considering that he allotted only one day, that is Thursday, to hear and try small
claims cases. The OCA found Judge Gumarang guilty of Gross ignorance of the law and recommended
the filing of a regular administrative case against Judge Gumarang.
ISSUE:
Whether or not Judge Gumarang violated the Rule of Procedure for Small Claims Cases
RULING:
YES. Section 22 of the Rule of Procedure for Small Claims Cases clearly provides that the judge
shall hear and decide the case within five (5) days from the receipt of the order of reassignment. The
theory behind the small claims system is that ordinary litigation fails to bring practical justice to the
parties when the disputed claim is small, because the time and expense required by the ordinary
litigation process is so disproportionate to the amount involved that it discourages a just resolution
of the dispute. The small claims process is designed to function quickly and informally. There are no
lawyers, no formal pleadings and no strict legal rules of evidence.
Thus, the intent of the law in providing the period to hear and decide cases falling under the
Rule of Procedure for Small Claims Cases, which is within five (5) days from the receipt of the order
of assignment, is very clear. The exigency of prompt rendition of judgment in small claims cases is a
matter of public policy. There is no room for further interpretation; it does not require respondent's
exercise of discretion. He is duty-bound to adhere to the rules and decide small claims cases without
undue delay.
When the rules of procedure are clear and unambiguous, leaving no room for interpretation,
all that is needed to do is to simply apply it. Failure to apply elementary rules of procedure constitutes
gross ignorance of the law and procedure. In the instant case, neither good faith nor lack of malice
will exonerate respondent, as the rules violated were basic procedural rules.
Doctrine of Exhaustion of Administrative Remedies
UNIVERSAL ROBINA CORP. v. LAGUNA LAKE DEVELOPMENT AUTHORITY

G.R. No. 191427, 30 May 2011, THIRD DIVISION, (Carpio Morales, J.)
The doctrine of exhaustion of administrative remedies is a cornerstone of our judicial

system. The thrust of the rule is that courts must allow administrative agencies to carry out their
functions and discharge their responsibilities within the specialized areas of their respective
competence.
Laguna Lake Development Authority (LLDA) held that Universal Robina Corp’s waste water
treatment facility failed comply with environmental laws and rendered them liable for penalties.
Universal Robina challenged by certiorari the twin orders before the Court of Appeals (CA),
attributing to LLDA grave abuse of discretion in disregarding its documentary evidence, and
maintaining that the lack of any plain, speedy or adequate remedy from the enforcement of LLDAs
order justified such recourse as an exception to the rule requiring exhaustion of administrative
remedies prior to judicial action.
The CA went on to chide Universal Robina’s petition for certiorari as premature since the law
provides for an appeal from decisions or orders of the LLDA to the DENR Secretary or the Office of
the President, a remedy which should have first been exhausted before invoking judicial intervention.
Universal Robina cites deprivation of due process and lack of any plain, speedy or adequate remedy
as grounds which exempted it from complying with the rule on exhaustion of administrative
remedies.
ISSUE:
Whether or not Universal Robina failed to exhaust administrative remedies.
RULING:
YES. Executive Order No. 192 was issued on June 10, 1987 for the salutary purpose of
reorganizing the DENR, charging it with the task of promulgating rules and regulations for the control
of water, air and land pollution as well as of promulgating ambient and effluent standards for water
and air quality including the allowable levels of other pollutants and radiations. EO 192 also created
the Pollution Adjudication Board under the Office of the DENR Secretary which took over the powers
and functions of the National Pollution Control Commission with respect to the adjudication of
pollution cases, including the latters role as arbitrator for determining reparation, or restitution of
the damages and losses resulting from pollution. Universal Robina had thus available administrative
remedy of appeal to the DENR Secretary. Its contrary arguments to show that an appeal to the DENR
Secretary would be an exercise in futility as the latter merely adopts the LLDAs findings is at best,
speculative and presumptuous.
The RTC acted in excess of its jurisdiction in deciding the appeal of Sps. Manzo when it
ordered the Sps. Manzo to execute a deed of absolute sale in favor of the Sps. Manila. Such erroneous
grant of relief, however, is but an exercise of jurisdiction by the RTC. Thus, while Sps. Manzo assailed
the content of the RTC decision, they failed to show that the RTC did not have the authority to decide
the case on appeal. The CA therefore erred in annulling the RTC decision on the ground of lack of
jurisdiction as said court had jurisdiction to take cognizance of the appeal.
Cause of Action
VIRRA MALL TENANTS ASSOCIATION, INC. v. VIRRA MALL GREENHILLS ASSOC., INC., et al.
G.R. No. 182902, 5 October 2011, SECOND DIVISION, (Sereno, J.)
Ortigas and Company, Limited Partnership is the owner of the Greenhills Shopping Center.
Ortigas and Virra Realty entered into a Contract of Lease over a portion of the GSC. The 25-year lease
was to expire on 15 November 2000. Pursuant thereto, Virra Realty constructed a commercial
building, the Virra Mall Shopping Center (Virra Mall), which was divided into either units for lease or
units whose leasehold rights were sold. Thereafter, Virra Realty organized Virra Mall Greenhills
Association (VMGA), an association of all the tenants and leasehold right holders, who managed and
operated Virra Mall. In the First Contract of Lease, VMGA assumed and was subrogated to all the
rights, obligations and liabilities of Virra Realty.
On 22 November 2000, VMGA, through its president, William Uy (Uy), requested from Ortigas
the renewal of the First Contract of Lease. VGMA secured two insurance policies to protect Virra Mall
against damage by fire and other causes. On 3 September 2001, Ortigas entered into a Contract of
Lease (Second Contract of Lease) with Uy effective 2 November 2001 to 31 December 2004. On 11
September 2001, the latter assigned and transferred to petitioner Virra Mall Tenants Association
(VMTA) all his rights and interests over the property.
Ortigas filed a Complaint for Specific Performance with Damages and Prayer for Issuance of
a Writ of Preliminary Attachment against several defendants, including herein respondents. It
accused them of fraud, misappropriation and conversion of substantial portions of the insurance
proceeds for their own personal use unrelated to the repair and restoration of Virra Mall. VMTA filed
a complaint-in-intervation. It claimed that as the assignee or transferee of the rights and obligations
of Uy in the Second Contract of Lease, and upon the order of Ortigas, it had engaged the services of
various contractors. Herein respondents moved for the dismissal of the Complaint-in-Intervention
on the ground that it stated no cause of action
ISSUE:
Whether or not VMTA failed to state a cause of action.
HELD:
NO. VMTA has a cause of action. VMTA, in its Complaint-in-Intervention, explicitly laid down
its cause of action as follows:
“Pursuant to and by virtue of such claim, defendant VMGA and defendant VMGA
Board Members, impleaded as party defendants herein, received, at various times, from
their insurance broker, and it is in their custody, the insurance proceeds arising out of
such claim which, as of January 8, 2003, aggregated P48.6-Million. Having failed to
deliver the said proceeds to the real beneficiary inspite of due notice and demand,
plaintiff Ortigas herein instituted the present action against all the defendants to
compel delivery of the said insurance proceeds which are being unlawfully and illegally
withheld by all the defendant VMGA and defendant VMGA Board Members inspite of
written demands made therefor. Worse, a portion of said insurance proceeds,
aggregating P8.6-Million had already been disbursed and misappropriated in breach of
trust and fiduciary duty.”
It is clear from the foregoing allegations that VMTAs purported right is rooted in its claim that
it is the real beneficiary of the insurance proceeds, on the grounds that it had (a) facilitated the repair
and restoration of the insured infrastructure upon the orders of Ortigas, and (b) advanced the costs
thereof. Corollarily, respondents have a duty to reimburse it for its expenses since the insurance
proceeds had already been issued in favor of respondent VMGA, even if the latter was not rightfully
entitled thereto.
Finally, the imputed act or omission on the part of respondents that supposedly violated the
right of VMTA was respondent VMGAs refusal, despite demand, to release the insurance proceeds it
received to reimburse the former for the expenses it had incurred in relation to the restoration and
repair of Virra Mall. Clearly, then, VMTA was able to establish its cause of action.
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED MININGCOMPANY

Absence of a cause of action (as opposed to the failure to state a cause of action), estoppel, and
pari delicto are not grounds in a Motion to Dismiss under Section 1, Rule 16 of the Rules of Court. Rather,
such defenses raise evidentiary issues and should therefore be threshed out during the trial. To sustain a
Motion to Dismiss for lack of cause of action, the complaint must show that the claim for relief does not
exist and not only that the claim was defectively stated or is ambiguous, indefinite or uncertain.
Lepanto Consolidated Mining Company (Lepanto) filed with the Regional Trial Court (RTC)
of Makati City a Complaint against NM Rothschild & Sons (Australia) LTD (NM) praying for a
judgment declaring the loan and hedging contracts between the parties void for being contrary to
Article 2018 of the Civil Code and for damages. The Complaint was docketed and raffled. Upon
Lepanto’s motion, the trial court authorized their counsel to personally bring the summons and
Complaint to the Philippine Consulate General in Sydney, Australia for the latter office to effect
service of summons on NM.
NM filed a Special Appearance With Motion to Dismiss on the following grounds: (a) the court
has not acquired jurisdiction over its person due to the defective and improper service of summons;
(b) the Complaint failed to state a cause of action and Lepanto does not have any against NM; (c) the
action is barred by estoppel; and (d) respondent did not come to court with clean hands. Thereafter,
NM filed twin Motions to take deposition and to serve interrogatories.
The RTC denied the Motion to Dismiss. According to the trial court, there was a proper service
of summons and that the complaint sufficiently stated a cause of action. The other allegations in the
said Motion were brushed aside as matters of defense best be ventilated during the trial. Likewise,
the motion for reconsideration (MR) and the twin motions were denied and disallowed, respectively.
On petition for certiorari, the Court of Appeals (CA) ruled that since the denial of a Motion to Dismiss
is an interlocutory order, it cannot be the subject of a Petition for Certiorari, and may only be
reviewed by an appeal from the judgment after trial. Likewise, the MR was denied. Hence, this
petition.
ISSUE:
Whether or not the RTC erred in disregarding the other grounds stated in the motion to
dismiss, stating that such are defenses which may be raised during trial.
RULING:
NO. As correctly ruled by both the trial court and the CA, the alleged absence of a cause of
action (as opposed to the failure to state a cause of action), the alleged estoppel, and the argument
of pari delicto in the execution of the challenged contracts, are not grounds in a Motion to Dismiss as
enumerated in Section 1, Rule 16 of the Rules of Court. Rather, such defenses raise evidentiary issues
closely related to the validity and/or existence of respondents alleged cause of action and should
therefore be threshed out during the trial.
As regards the allegation of failure to state a cause of action, while the same is usually
available as a ground in a Motion to Dismiss, said ground cannot be ruled upon in the present Petition
without going into the very merits of the main case. Further, we have held that to sustain a Motion to
Dismiss for lack of cause of action, the complaint must show that the claim for relief does not exist
and not only that the claim was defectively stated or is ambiguous, indefinite or uncertain.
As to the issue on the lack of jurisdiction over NM’s person due to an improper service of
summons, the Court held that the summons was served on NM through the DFA, with Lepanto’s
counsel personally bringing the summons and Complaint to the Philippine Consulate General in
Sydney, Australia.
PHILIPPINE ARMY v. SPOUSES MAJOR CONSTANCIOPAMITTAN (Ret.) et al.

G.R. No. 187326, 15 June 2011, SECOND DIVISION, (Carpio, J.)
The RTC dismissed the complaint for lack of cause of action considering that the State as the
owner has the right to use the subject property. Citing Custodio v. Court of Appeals, the RTC held that
there is no cause of action for lawful acts done by the owner on his property although such acts may
cause incidental damage or loss to another.
Spouses Major Constancio Pamittan et al. filed a complaint for Damages, Injunction with
Prayer for a Writ of Preliminary Mandatory Injunction, and Temporary Restraining Order against
Philippine Army. Pamittan et al. averred that they have been occupying and residing on the land
which is part of the Breeding Station of the Department of Agriculture (DA), located in Sitio San
Carlos, Barangay Upi in Gamu, Isabela for the past twenty to thirty years. Their occupation of the land
was allegedly pursuant to a prior arrangement between the DA and the then higher authorities in
Camp Melchor F. dela Cruz, on the condition that the DA retains ownership over the land. Pamittan
et al. averred that on 3 July 2006, upon orders of Philippine Army, active elements of the 5th Infantry
Division, PA, tore down, demolished, and dismantled their houses. Pamittan et al., through their
counsel, demanded in writing that Philippine Army and their subordinates cease and desist from
further demolishing their dwellings; otherwise, they would sue for damages. The demolition crew
continued tearing down other houses despite the demand letter claiming that the demolition was
illegal because of lack of a court order.
The Office of the Solicitor General moved to dismiss the complaint, arguing that the complaint
states no cause of action. The OSG claims that the Philippine Army was merely exercising right of
ownership to the property in which ownership the Pamittan et al. similarly failed to establish in their
complaint.
ISSUE:
Whether or not Pamittan et al. failed to state a cause of action which warrants a dismissal.
RULING:
YES. Generally, a motion to dismiss based on failure to state a cause of action hypothetically
admits the truth of the allegations in the complaint and in order to sustain a dismissal based on lack
of cause of action, the insufficiency of the cause of action must appear on the face of the
complaint. However, this rule is not without exception. Thus, a motion to dismiss does not admit
allegations of which the court will take judicial notice are not true, nor does the rule apply to legally
impossible facts, nor to facts inadmissible in evidence, nor to facts which appear by record or
document included in the pleadings to be unfounded. Indeed, in some cases, the court may also
consider, in addition to the complaint, other pleadings submitted by the parties and the annexes or
documents appended to it.
In this case, the RTC considered other pleadings, aside from the complaint, filed by both
parties, including the annexes in determining the sufficiency of the cause of action.It is undisputed
that Pamittan et al. neither own nor lease the land on which they constructed their houses.
Nevertheless, Pamittan et al. insist that the demolition of their houses upon orders of the Philippine
Army was illegal because their houses stood on property which forms part of the DA Breeding Station
and not within the military reservation. However, as found by the RTC, Pamittan et al.’s contention
is belied by the survey report of the Department of Environment and Natural Resources (DENR). In
its order the RTC found that contrary to Pamittan et al.’s allegations in their complaint, the land
occupied by them is within the military reservation based on the survey conducted by the DENR. The
Assistant Chief of the Surveys Division reported that the Survey Team found that the area occupied
by the 82 household dwellers with an area of about 27,251 square meters is within the perimeter of
the military reservation.
CRISTINA TRINIDAD ZARATE ROMERO
G.R. No. 163827, 17 August 2011, FIRST DIVISION, (Villarama, Jr., J)
If any of element of a valid cause of action is absent, the complaint becomes vulnerable to a
motion to dismiss on the ground of failure to state a cause of action.
Corazon Zarate Romero and his brother Gonzalo Zarate co-owned a property located
in Dagupan City, Province of Pangasinan, with a four-storey hotel erected thereon. It appears that
sometime in 1975, Corazon and Gonzalo obtained a loan from Development Bank of the Philippines.
As collateral, they executed a real estate mortgage over the subject property in favor of DBP. On the
alleged failure of the two borrowers to pay their amortizations, DBP foreclosed the real estate
mortgage on September 15, 1983. Purportedly, no redemption was made within one year, and thus,
DBP consolidated ownership over the subject property.
When Corazon passed away, her sole heir, her daughter respondent Cristina Trinidad Zarate
Romero, asserted ownership over the subject property to the extent of one-half thereof. However,
respondent discovered that the property was already registered as early as June 13, 1989 in the name
of DBP. Romero filed before the Regional Trial Court a complaint for reconveyance, quieting of title
and damages with prayer for a temporary restraining order and writ of preliminary injunction to
prevent DBP from conducting any auction sale on the subject property during the pendency of the
case. The RTC, after hearing, issued a TRO restraining DBP from proceeding with its scheduled
auction of the disputed. DBP filed a petition for certiorari before the CA. The CA dismissed the petition
on procedural grounds. It held that the petition questioning the first three orders was filed late as the
petition should have been filed within 60 days from receipt of the assailed orders.
ISSUES:
Whether or not Romero has a cause of action.
RULING:
YES. A cause of action is the act or omission by which a party violates a right of another. A
complaint states a cause of action when it contains three essential elements: (1) a right in favor of
the plaintiff by whatever means and whatever law it arises; (2) the correlative obligation of the
defendant to respect such right; and (3) the act or omission of the defendant violates the right of the
plaintiff. If any of these elements is absent, the complaint becomes vulnerable to a motion to dismiss
on the ground of failure to state a cause of action.
Evidently, all the above elements of a cause of action are alleged in the complaint: (1) the legal
right of the respondent over the subject property foreclosed premised on the fact that she is the sole
heir of one of the owners who is entitled to the right of redemption; (2) the correlative obligation of
defendant DBP, as the foreclosing entity, to respect such right of redemption; and (3) the act or
omission of the defendant in violation of the legal right, i.e., the act of DBP and its co-defendant Zarate
to cause the ostensible foreclosure of the subject property and the subsequent execution of a deed of
conditional sale between the defendants even prior to the lapse of redemption period to deprive
respondents mother of her right over the property.
Real Party in Interest

STEFAN TITO MIÑOZA v. HON. CESAR TOMAS LOPEZ, IN HIS OFFICIAL CAPACITY AS MAYOR
AND CHAIR, et. al.
G.R. No, 170914, 13 April 2011, FIRST DIVISION (Del Castillo, J.)
There can be no legal duel in court when the one who demands satisfaction from the alleged
offender is not even the offended party.
For several years since 1988, Stefan Tito Miñoza (Miñoza) was the duly licensed owner and
operator of the Loon Cockpit Arena in Cogon Norte, Loon, Bohol. Because of the dilapidation of the
building, the increasing rentals and the lot owner's notice for him to vacate by October 2001, he
transferred his business operation to Brgy. Lintuan in Loon. Miñoza began the construction of a new
cockpit after securing from the municipal officials a building permit, an electrical permit and a fencing
permit. By the end of 2001, the cockpit was certified by the municipal engineer as 65% complete.
Municipal Mayor Cesar Tomas Lopez (Mayor Lopez) issued in favor of Miñoza a temporary permit to
hold cockfights at the newly built cockfighting.
Six days later, however, the Sangguniang Bayan issued Resolution declaring the cockpit in
Brgy. Lintuan as unlicensed and that the only licensed cockpit is the one in Cogon Norte. As a result,
Mayor Lopez revoked Miñoza's temporary license to operate. Subsequently, Municipal Ordinance No.
03-001 Series of 2003 or the "Cockfighting Ordinance of Loon" was approved to regulate cockfighting
in the municipality. Pursuant thereto, the Sangguniang Bayan enacted Resolution which opened for
public bidding a 25-year franchise of the cockpit operation in Loon. Marcelo Epe (Marcelo) was
declared the winner and a franchise for the cockpit operation in Loon was granted in his favor by
way of Municipal Ordinance No. 03-007, Series of 2003.
Miñoza filed a Complaint with the Regional Trial Court (RTC) against Mayor Lopez alleging
that the bidding was rigged and fraudulently manipulated to benefit Marcelo, Mayor Lopez's rumored
business partner and financial backer. Considering the rigged bidding, Miñoza claimed that the
ordinance awarding the franchise to Marcelo has no basis. The Regional Trial Court (RTC) dismissed
the complaint resolving that Miñoza is not a proper party to sue since he was not even part of the
bidding process. In the Court of Appeals (CA), Miñoza questioned the decision of the lower court. The
CA likewise dismissed the petition.
ISSUE:
Whether or not Miñoza has the standing to challenge the bidding proceedings and the
issuance of the ordinance.
RULING:
NO. It is a general rule that every action must be prosecuted or defended in the name of the
real party-in-interest, who stands to be benefited or injured by the judgment in the suit, or the party
entitled to the avails of the suit.
Miñoza, not being one of the bidders clearly has no personality to contest the alleged rigged
bidding as well as to pray for the annulment of Ordinance which granted the franchise to Marcelo.
The fact that he owns the cockpit in Brgy. Lintuan does not clothe him with legal standing to have the
bidding proceedings annulled and Marcelo stripped off of the cockpit franchise. Even assuming that
the bidding proceeding was rigged thereby disqualifying Marcelo as a bidder, the highest bidder
would still be Jose, and not Miñoza who was not even a participant. Contrary to his claim that Jose
was his representative, records show that Jose acted in his personal capacity when he applied to be
one of the bidders of the cockpit franchise. Never was it shown that he was bidding on behalf of
someone else, particularly Miñoza.
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED MININGCOMPANY

A real party in interest is the party who stands to be benefited or injured by the judgment in the
suit, or the party entitled to the avails of the suit. We shall not go so far as to dismiss a case filed by the
proper party using its former name when adequate identification is presented.
petition.
ISSUE:
Whether or not NM is a real party in interest.
RULING:
NO. Lepanto argues that the present Petition should be dismissed on the ground that NM no
longer existed as a corporation at the time said Petition was filed. Lepanto points out that as of the
date of the filing of the Petition, there is no such corporation that goes by the name NM Rothschild
and Sons (Australia) Limited. On the other hand, NM averred that it started to refer to itself as Investec
Australia Limited. NM claims that NM Rothschild and Sons (Australia) Limited still exists as a
corporation under the laws of Australia under said new name. It presented before us documents
evidencing the process in the Australian Securities & Investment Commission on the change of its
company name.
The Court find the submissions of petitioner on the change of its corporate name satisfactory
and resolve not to dismiss the present Petition for Review on the ground of not being prosecuted
under the name of the real party in interest. The Court did not go so far as to dismiss a case filed by
the proper party using its former name when adequate identification is presented. A real party in
interest is the party who stands to be benefited or injured by the judgment in the suit, or the party
entitled to the avails of the suit.
TOMAS R. OSMEA v. THE COMMISSION ON AUDIT

G.R. No. 188818, 31 May 2011, EN BANC, (Brion, J.)
Every plea for a liberal construction of the Rules must at least be accompanied by an explanation
of why the party-litigant failed to comply with the Rules and by a justification for the requested liberal
construction.
The COA rendered Mayor Tomas Osmea (Osmea) of Cebu personally liable for ordering the
change or extra work orders without the supplemental agreement required by law, or the prior
authorization from the Sanggunian regarding the construction of the venue for the Palarong
Pambansa to be hosted by Cebu. The Office of the Mayor of Cebu City received the June 8,
2009 Resolution of the COA on June 29, 2009. A day before, however, Osmea left for the United States
of America for his check-up after his cancer surgery in April 2009 and returned to his office only
on July 15, 2009. Thus, it was only on July 27, 2009that Osmea filed the present petition
for certiorari under Rule 64 to assail the COAs Resolution of June 8, 2009.
ISSUE:
Whether or not the petition for certiorari under Rule 64 may be granted albeit filed late.
RULING:
YES. Several times in the past, we emphasized that procedural rules should be treated with
utmost respect and due regard, since they are designed to facilitate the adjudication of cases to
remedy the worsening problem of delay in the resolution of rival claims and in the administration of
justice. From time to time, however, we have recognized exceptions to the Rules but only for the most
compelling reasons where stubborn obedience to the Rules would defeat rather than serve the ends
of justice. Where strong considerations of substantive justice are manifest in the petition, this Court
may relax the strict application of the rules of procedure in the exercise of its legal jurisdiction.
Osmea cites the mandatory medical check-ups he had to undergo in Houston, Texas after his
cancer surgery in April 2009 as reason for the delay in filing his petition for certiorari. Due to his
weakened state of health, he claims that he could not very well be expected to be bothered by the
affairs of his office and had to focus only on his medical treatment. He could not require his office to
attend to the case as he was being charged in his personal capacity.
The Court find Osmeas reasons sufficient to justify a relaxation of the Rules. Although the
service of the June 8, 2009 Resolution of the COA was validly made on June 29, 2009 through the
notice sent to the Office of the Mayor of Cebu City, we consider July 15, 2009 the date he reported
back to office as the effective date when he was actually notified of the resolution, and the reckoning
date of the period to appeal. If we were to rule otherwise, we would be denying Osmea of his right to
appeal the Decision of the COA, despite the merits of his case. Notably, the court found merit to the
claim in this case which perhaps substantiated the relaxation of the rules of procedure. As to the main
case the court held that the City of Cebu tacitly approved these orders, rendering a supplemental
agreement or authorization from the Sanggunian unnecessary.
Death of Party
JOSE RAMILO O. REGALADO v. CHAUCER B. REGALADO AND GERARD R. CUEVAS

The heirs of the deceased may be allowed to be substituted for the deceased, without requiring
the appointment of an executor or administrator and the court may appoint a guardian ad litem for the
minor heirs. The court shall forthwith order said legal representative or representatives to appear and
be substituted within a period of thirty (30) days from notice.
This is case Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing
the twin Resolutions of the Court of Appeals (CA), entitled Hugo C. Regalado, represented by Jose
Ramilo O. Regalado v. Chaucer B. Regalado and Jose Gerard R. Cuevas.
The first assailed Resolution dismissed Jose Regalado’s (Jose) appeal. He sought
reconsideration and asked for leniency in the application of the Rules of Court. Attached in his motion
were copies of the pleadings pertinent and relevant to his petition. Jose asserted that he was
authorized to sign the verification and certification of non-forum shopping in behalf of Hugo
Regalado (Hugo) by virtue of a Special Power of Attorney attached to the complaint filed together
with the motion for reconsideration.
Chaucer Regalado (Chaucer) and Gerard Cuevas (Gerard) opposed the motion and
manifested that Hugo died on April 23, 2008, even before the challenged decision of the Regional
Trial Court (RTC) was rendered on May 15, 2008. On December 15, 2009, Atty. Miguel B. Albar,
counsel of Hugo, furnished the CA with a notice of Hugo’s death on April 23, 2008, together with a list
of the latter’s legal representatives. On October 15, 2010, the CA denied the motion for
reconsideration, from this denial, Jose is now before the Supreme Court, seeking for the reversal of
the CAs issuances. He argues that after the death of Hugo Regalado, he did not lose his right or interest
over the case since he is one of the compulsory heirs. As such, he signed the petition before the CA,
not as an agent of Hugo Regalado, but as a compulsory heir.
ISSUE:
Whether or not the contention of petitioner Jose Regalado is meritorious.
RULING:
YES. The action that led to the present controversy was one for cancellation of title, which is
a real action affecting as it does title to or possession of real property. It is an action that survives or
is not extinguished upon the death of a party, pursuant to Section 1, Rule 87 of the Rules of Court.
Section 16, Rule 3 lays down the procedure that must be observed when a party dies in an action that
survives. The heirs of the deceased may be allowed to be substituted for the deceased, without
requiring the appointment of an executor or administrator and the court may appoint a guardian ad
litem for the minor heirs. The court shall forthwith order said legal representative or representatives
to appear and be substituted within a period of thirty (30) days from notice. If no legal representative
is named by the counsel for the deceased party, or if the one so named shall fail to appear within the
specified period, the court may order the opposing party, within a specified time, to procure the
appointment of an executor or administrator for the estate of the deceased and the latter shall
immediately appear for and on behalf of the deceased. The court charges in procuring such
appointment, if defrayed by the opposing party, may be recovered as costs.
Hugo passed away on April 23, 2008, but the notice of his death was served to the CA by his
counsel only on December 15, 2009. Although Hugo died as early as the pendency of the proceedings
before the RTC, the non-fulfillment of the requirement before said court is excusable since the RTC
rendered a decision on May 15, 2008, or before the expiration of the 30-day period set by the rule.
This notwithstanding, it was still error for the CA to dismiss the appeal. After receiving the notice of
Hugo death, together with a list of his representatives, it was incumbent upon the appellate court to
order the latter’s appearance and cause their substitution as parties to the appeal. The belated filing
of the notice must not prejudice the deceased party’s legal representatives; the rules clearly provide
that it is a mere ground for a disciplinary action against the erring counsel. Instead of abiding by the
course of action set forth by the rules, the CA adopted a myopic examination of the procedural facts
of the case. It focused simply on the validity of the Special Power of Attorney, and completely
disregarded the notice of Hugo death. Indeed, nothing is more unfortunate in law than when a
counsel’s remedial faux pas is improperly addressed by a court.
Venue
GOLDEN ARCHES DEVELOPMENT CORPORATION v. ST. FRANCIS SQUARE HOLDINGS, INC.

G.R. No. 183843, 19 January 2011, THIRD DIVISION (Carpio-Morales, J.)
The proper venue was at the place where the petitioner or defendant was
actually been residing (or holding its principal office) at the time petitioner filed its complaint, although
its Articles of Incorporation states another address.
Golden Arches Development Corporation entered into a lease contract over a property owned
by Prince City Realty, Inc. located at the corner of Julia Vargas Avenue and Bank
Drive, Ortigas Center, Mandaluyong City.Golden Arches wanted to pre-terminate the contract
however amicable negotiations between the parties having failed.St. Francis Square filed an action
for breach of contract and damages before the RTC of Mandaluyong. Golden Arches filed a Motion to
Dismiss for lack of cause of action and improper venue. It claimed that St. Francis Square maintained
its principal address in Makati, hence, the complaint should have been filed in Makati.Opposing the
Motion to Dismiss, St. Francis Square claimed that it had closed down its office in Makati effective
December 31, 2005 as it now holds office in Mandaluyong City of which Golden Arches is aware. The
RTC denied the motion to dismiss. The CA affirmed.
ISSUE:
Whether or not the case should be dismissed for having been filed on the wrong venue.
RULING:
NO. With respect to a domestic corporation, it is in a metaphysical sense a resident of the

place where its principal office is located as stated in the articles of incorporation. In the instant case,
although St. Francis Square’s Amended Articles of Incorporation of 2007 indicates that its principal
business address is at Makati, venue was properly laid in Mandaluyong since that is where it
had actually been residing (or holding its principal office) at the time it filed its complaint.
Service/Notice
REPUBLIC OF THE PHILIPPINES v. RESINS, INCORPORATED

It is the registry receipt issued by the mailing office and the affidavit of the person mailing, which
proves service made through registered mail. Absent one or the other, or worse both, there is no proof
of service. Mere certification of the RTC Clerk of Court is insufficient because the Clerk of Court may not
be the person who did the mailing.
Resins, Inc. filed Land Registration Case before the Regional Trial Court (RTC) for judicial
confirmation of title over eight (8) parcels of land. Pursuant to the LRA recommendation, the
application for original registration of titles was amended. The OSG entered its appearance as counsel
of the Republic. On 17 March 1993, the RTC rendered its Judgment in favor of Resins, Inc. but despite
the favorable judgment, Resins, Inc., was unable to have the lots registered in its name because of
typographical errors in the RTC’s 17 March 1993 Judgment. Resins, Inc. moved to correct the
typographical errors but the two (2) errors were corrected. RTC issued an Order granting Resins,
Inc.’s motion. Despite notice to the Solicitor General, he or his representative did not appear in the
hearing of June 18, 1999, nor did he file an opposition to the motion. The Motion for Reconsideration
filed by the Republic was denied. The Republic filed a Petition for Certiorari before the CA which
denied such Petition.
ISSUE:
Whether or not there was proper service to the Republic of the March 17 judgment.
RULING:
NO. When service of notice is an issue, the rule is that the person alleging that the notice was
served must prove the fact of service. The burden of proving notice rests upon the party asserting its
existence. In civil cases, service made through registered mail is proved by the registry receipt issued
by the mailing office and an affidavit of the person mailing of facts showing compliance with Section
13, Rule 13 of the 1997 Rules on Civil Procedure.
OSG’s denial of receipt of the 17 March 1993 Judgment required Resins, Inc. to show proof
that the Judgment was sent through registered mail and that it was received by the Republic. While
the certification from the RTC Clerk of Court and photocopies of the return slips prove that the
Republic was served the judgment, it does not follow that the Republic, via the OSG, actually received
the judgment. Receipts for registered letters and return receipts do not prove themselves, they must
be properly authenticated in order to serve as proof of receipt of the letters. Resins, Inc. also did not
show a certification from the postmaster that notice was duly issued and delivered to the OSG such
that service by registered mail may be deemed completed. It cannot be stressed enough that it is the
registry receipt issued by the mailing office and the affidavit of the person mailing, which proves
service made through registered mail. Absent one or the other, or worse both, there is no proof of
service.
Mere certification of the RTC Clerk of Court is insufficient because the Clerk of Court may not
be the person who did the mailing. The certification in this case is also not under oath. There must be
an affidavit of the person who actually did the mailing. It is clear that the certification does not state
that the Clerk of Court did the mailing. Mere photocopies of the return slips are also insufficient. The
original copies of the registry receipt or, in lieu thereof, the unclaimed notice and a certification from
the postmaster of the issuance of notice, should be presented.
MA. LIGAYA B. SANTOS v. LITTON MILLS INCORPORATED

G.R. NO. 170646, 22 JUNE 2011, FIRST DIVISION, (DEL CASTILLO, J.)
Rules of procedure should be relaxed when there is substantial and subsequent compliance.
Ma. Ligaya B. Santos (Santos) filed a case of illegal dismissal against Litton Mills Incorporated.
The Labor Arbiter and NLRC ruled against Santos. Consequently, Santos filed a Petition
for Certiorari with the Court of Appeals (CA). However, the CA dismissed the petition for failure of
Santos to indicate in the petition the actual addresses of the parties. Santos filed a Motion for
Reconsideration explaining that her petition substantially complied with the provisions of Section 3,
Rule 46 of the Rules of Court because it indicated that the parties may be served with notices and
processes of the Court through their respective counsels whose addresses were specifically
mentioned therein. The CA denied the motion for reconsideration.
ISSUE:
Whether or not the failure to indicate in the petition the actual addresses of the parties and
instead indicating the counsel’s address warrants the dismissal of the petition.
RULING:
NO. In the petition for certiorari filed before the CA, Santos indeed failed to indicate the actual
addresses of the parties. However, she clearly mentioned that the parties may be served with the
Court's notices or processes through their respective counsels whose addresses were clearly
specified.
The mention of the parties' respective counsel's addresses constitutes substantial compliance
with the requirements of Section 3, Rule 46 of the Rules of Court which provides in part that "the
petition shall contain the full names and actual addresses of all the petitioners and respondents." Our
observation further finds support in Section 2, Rule 13 which pertinently provides that "if any party
has appeared by counsel, service upon him shall be made upon his counsel or one of them, unless
service upon the party himself is ordered by the Court." As we held in Garrucho v. Court of
Appeals, "notice or service made upon a party who is represented by counsel is a nullity. Notice to
the client and not to his counsel of record is not notice in law."
Moreover, in her motion for reconsideration, Santos explained that she was of the honest
belief that the mention of the counsel's address was sufficient compliance with the rules. At any rate,
she fully complied with the same when she indicated in her Motion for Reconsideration the actual
addresses of the parties. Hence, we are at a loss why the CA still proceeded to deny Santos’ petition
for certiorari and worse, even declared that: "Instead of rectifying the deficiencies of the petition, the
Santos chose to avoid compliance, arguing more than revising the mistakes explicitly pointed out."
Multiplicity of Suits
ARTURO SARTE FLORES v. SPOUSES ENRICO L. LINDO, JR. and EDNA C. LINDO
G.R. No. 183984 , 13 April 2011, SECOND DIVISION (Carpio, J.)
The rule is that a mortgage-creditor has a single cause of action against a mortgagor-debtor,
that is, to recover the debt. The mortgage-creditor has the option of either filing a personal action for
collection of sum of money or instituting a real action to foreclose on the mortgage security. An election
of the first bars recourse to the second, otherwise there would be multiplicity of suits in which the debtor
would be tossed from one venue to another depending on the location of the mortgaged properties and
the residence of the parties.
Edna Lindo (Edna) obtained a loan from Arturo Flores (Flores) amounting to P400,000. To
secure the loan, Edna executed a Deed of Real Estate Mortgage (the Deed) covering a property in the
name of Edna and her husband Enrico Lindo, Jr. (Enrico). Edna also signed a Promissory Note and
the Deed for herself and for Enrico as his attorney-in-fact. Edna issued three checks as partial
payments for the loan. All checks were dishonored for insufficiency of funds, prompting Flores to file
a Complaint for Foreclosure of Mortgage with Damages against respondents. The case was raffled to
the Regional Trial Court of Manila, Branch 33 (RTC, Branch 33). RTC Branch 33 rendered a decision
that Flores was not entitled for judicial foreclosure of the mortgage since the deed executed by Edna
was without consent and authority of Enrico
Flores then filed a Complaint for Sum of Money with Damages against Enrico and Edna. It was
raffled to Branch 42 (RTC, Branch 42) of the Regional Trial Court of Manila. Enrico and Edna prayed
for the dismissal of the complaint. RTC Manila Branch 42 denied the motion of Enrico and Edna.
Enrico and Edna then filed a petition for certiorari and mandamus before the Court of Appeals
(CA). The CA rendered a decision that RTC Branch 42 committed grave abuse of discretion in issuing
its decision. The CA ruled that under the Rules of Court, a party may not institute more than one suit
for a single cause of action, since this will amount to multiplicity of suits.
ISSUE:
Whether or not the CA committed reversible error in dismissing the complaint for collection
of sum of money on the ground of multiplicity of suits.
RULING:
YES. The rule is that a mortgage-creditor has a single cause of action against a mortgagor-
debtor, that is, to recover the debt. The mortgage-creditor has the option of either filing a personal
action for collection of sum of money or instituting a real action to foreclose on the mortgage security.
An election of the first bars recourse to the second, otherwise there would be multiplicity of suits in
which the debtor would be tossed from one venue to another depending on the location of the
mortgaged properties and the residence of the parties.
The two remedies are alternative and each remedy is complete by itself. If the mortgagee opts
to foreclose the real estate mortgage, he waives the action for the collection of the debt, and vice
versa. The Court has ruled that if a creditor is allowed to file his separate complaints simultaneously
or successively, one to recover his credit and another to foreclose his mortgage, he will, in effect, be
authorized plural redress for a single breach of contract at so much costs to the court and with so
much vexation and oppressiveness to the debtor.
Payment of Docket Fees
SAMUEL JULIAN v. DEVELOPMENT BANK OF THEPHILIPPINES and THE CITY SHERIFF

G.R. No. 174193,7December 2011, FIRST DIVISION (DEL CASTILLO, J.)
Payment of the full amount of docket fees within the prescribed period is both mandatory and
jurisdictional.
Thelma Julian (Thelma) obtained a housing loan from Development Bank of the Philippines
(DBP) secured by a real estate mortgage. Thelma died. Because of arrearages in the monthly
amortizations, DBP foreclosedthe mortgaged property. Thereafter, the actual occupants of the
mortgaged property, spouses Dela Cruz, offered to purchase the property. DBP accepted the offer and
executed a Deed of Conditional Sale. However, spouses De la Cruz failed to pay 72 monthly
amortizations resulting in the rescission of the said deed. Notwithstanding, spouses De la Cruz
refused to vacate the premises compelling DBP to file an Unlawful Detainer case. Judgment was
rendered in favor of DBP. However, before the Writ of Execution could be carried out, Samuel Julian
(Samuel) filed a civil case questioning the public auction. During the course of the proceedings, a
series of postponements were made at the instance of both parties due to an impending amicable
settlement. Eventually, the parties were able to reach a settlement. Thus, in an Order, the Regional
Trial Court (RTC) directed both parties to submit a joint motion to dismiss the case.
However, almost two years passed without the parties complying with the said Order.
Consequently, the RTC dismissed the case for failure of the parties to comply for an unreasonable
length of time. Samuel timely filed a Notice of Appeal but failed to pay the docket and other lawful
fees. The Court of Appeals (CA) dismissed the appeal for non-payment of the required docket and
other lawful fees.
ISSUE:
Whether the CA erred in applying strictly the rules on docket fees
RULING:
NO. Payment of the full amount of docket fees within the prescribed period is both mandatory
and jurisdictional. It is a condition sine qua non for the appeal to be perfected and only then can a
court acquire jurisdiction over the case. The requirement of an appeal fee is not a mere technicality
of law or procedure and should not be undermined except for the most persuasive of reasons. Non-
observance would be tantamount to no appeal being filed thereby rendering the challenged decision,
resolution or order final and executory.
Admittedly, this rule is not without recognized qualifications. The Court has declared that in
appealed cases, failure to pay the appellate court docket fee within the prescribed period warrants
only discretionary as opposed to automatic dismissal of the appeal and that the court shall exercise
its power to dismiss in accordance with the tenets of justice and fair play and with great deal of
circumspection considering all attendant circumstances. In the case at bench, the justifications
presented by Samuel for the non-payment of the docket fees are oversight and the lack of advice from
his counsel. Unfortunately, the reasons presented are neither convincing nor adequate to merit
leniency.
PACIFIC UNION INSURANCE COMPANY v. CONCEPTS & SYSTEMS DEVELOPMENT,

INCORPORATED
G.R. No. 183528, 23 February 2011, (Nachura, J.)
The Court have, in numerous instances, relaxed the Rules when an appellant altogether fails to
pay the docket fees; with greater reason should a liberal stance be taken in this case considering that
the appellate docket fees were actually paid and the only detail lacking is a specific breakdown of the
fees settled.
On February 17, 2007, the Regional Trial Court (RTC) rendered a decision in favor of
Concepts and System Development Inc. Pacific Union Insurance was ordered to pay P12,271,948.24
with a right to claim reimbursement from Perez the principal obligor.
When its motion for reconsideration was denied, Pacific Union Insurance appealed to the CA.
On July 9, 2007, Pacific Union Insurance filed its notice of appeal with the RTC. On July 10, 2007, the
RTC issued an Order granting the notice of appeal upon the finding that the same was filed and the
appeal docket fee therefor was paid within the reglementary period allowed by law.
In its first assailed resolution, the Court of Appeals (CA) dismissed Pacific Union Insurance’s
appeal for failure to pay the docket and other legal fees based on the absence of the proof of payment
of docket fees from the records transmitted by the RTC clerk of court.
ISSUE:
Whether or not the CA is correct that Pacific Union Insurance’s right to appeal was lost.
RULING:
NO. While it is desirable that the Rules of Court be faithfully and even meticulously observed,
courts should not be so strict about procedural lapses that do not really impair the administration of
justice. This is based, no less, on the Rules of Court which itself calls for a liberal construction of its
provisions, with the objective of securing for the parties a just, speedy, and inexpensive disposition
of every action and proceeding.
The dismissal of Pacific Union Insurance’s appeal was based on the absence of the proof of
payment of docket fees from the records transmitted by the RTC clerk of court. This procedural lapse
is too inconsequential to prejudice the administration of justice, considering that the required fees
were actually paid, as shown in the July 10, 2007 RTC Order granting the notice of appeal which
explicitly declares that the appeal docket fee therefor was paid within the reglementary period
allowed by law. That Pacific Union Insurance’s counsel mistakenly thought that no payment was
made, and thus prayed, in her motion for reconsideration, for the chance to pay the fees belatedly, is
of no moment. The fact is, there was actual payment.
DAVID LU v. PATERNO LU YM, SR., et al.

G.R. Nos. 153690, 157381 & 170889, 15 February 2011, EN BANC (Carpio-Morales, J.)
The test in determining whether the subject matter of an action is incapable of pecuniary
estimation is by ascertaining the nature of the principal action or remedy sought.
The case stemmed from the complaint for Declaration of Nullity of Share Issue, Receivership
and Dissolution filed before the Regional Trial Court (RTC) by David Lu, et al. (David, et al.) against
Paterno Lu Ym, Sr. and sons (Lu Ym father and sons) and Ludo & Luym Development Corporation
(LLDC). The RTC ruled in favor of David, et al. by annulling the issuance of the shares of stock
subscribed and paid by Lu Ym father and sons at less than par value, and ordering the dissolution
and asset liquidation of LLDC. The appeal of the trial court’s Decision remains pending with the Court
of Appeals (CA).
In 2008, the Court held that the complaint filed by David, et al. was incapable of pecuniary
estimation, thus, the trial court acquired jurisdiction. However, the Court, in its 2009 Resolution,
ruled that the trial court did not acquire jurisdiction over the case for David Lu, et al.’s failure to pay
the correct docket fees, hence, all interlocutory matters and incidents subject of the present petitions
must consequently be denied. Hence, the present Motion for Reconsideration.
ISSUE:
Whether or not the trial court acquired jurisdiction over the complaint filed by David, et al.
RULING:
YES. Upon a considered, thorough reexamination, the Court grants David Lu’s Motion for
Reconsideration. The assailed Resolutions of August 4, 2009 and September 23, 2009, which turn
turtle settled doctrines, must be overturned. The Court thus reinstates the August 26, 2008
Decision wherein a three-tiered approach was utilized to analyze the issue on docket fees:“In the
instant case, however, the Court cannot grant the dismissal prayed for because of the following
reasons: First, the case instituted before the RTC is one incapable of pecuniary
estimation. Hence, the correct docket fees were paid. Second, John and LLDC are estopped from
questioning the jurisdiction of the trial court because of their active participation in the proceedings
below, and because the issue of payment of insufficient docket fees had been belatedly raised before
the Court of Appeals, i.e., only in their motion for reconsideration. Lastly, assuming that the docket
fees paid were truly inadequate, the mistake was committed by the Clerk of Court who assessed the
same and not imputable to David; and as to the deficiency, if any, the same may instead be considered
a lien on the judgment that may thereafter be rendered.”
The complaint filed by David, et al. is one for declaration of nullity of share issuance. The main
relief prayed for both in the original complaint and the amended complaint is the same, that is, to
declare null and void the issuance of 600,000 unsubscribed and unissued shares to Lu Ym father and
sons, et al. for a price of 1/18 of their real value, for being inequitable, having been done in breach of
directors fiduciary’s duty to stockholders, in violation of the minority stockholders rights, and with
unjust enrichment.
As judiciously discussed in the Courts August 26, 2008 Decision, the test in determining
whether the subject matter of an action is incapable of pecuniary estimation is by ascertaining
the nature of the principal action or remedy sought. The Court explained that the annulment of the
shares, the dissolution of the corporation and the appointment of receivers/management committee
are actions which do not consist in the recovery of a sum of money. If, in the end, a sum of money or
real property would be recovered, it would simply be the consequence of such principal
action. Therefore, the case before the RTC was incapable of pecuniary estimation. IN FINE, the Court
holds that David Lu, et al.’s complaint is one incapable of pecuniary estimation, hence, the correct
docket fees were paid.
DO-ALL METALS INDUSTRIES, INC., et al. v. SECURITY BANK CORP., et al.

G.R. No. 176339, 10 January 2011, SECOND DIVISION (Abad, J.)
A supplemental complaint is like any complaint and the rule is that the filing fees due on a
complaint need to be paid upon its filing, failure of which, no damages can be awarded by the court.
Dragon Lady Industries, Inc., owned by spouses Domingo Lim and Lely Kung Lim (the Lims)
took out loans from Security Bank Corporation (the Bank). Unable to pay the loans on time, the Lims
assigned some of their real properties to the Bank to secure the same, including a building and the
lot on which it stands (the property). The Bank offered to lease the property to the Lims through
petitioner Do-All Metals Industries, Inc. (DMI) primarily for business although the Lims were to use
part of the property as their residence. DMI and the Bank executed a two-year lease contract but the
Bank retained the right to pre-terminate the lease. The contract also provided that, should the Bank
decide to sell the property, DMI shall have the right of first refusal. Before the lease was up, the Bank
gave notice to DMI that it was pre-terminating the lease. Wanting to exercise its right of first refusal,
DMI tried to negotiate with the Bank the terms of its purchase.
The Lims eventually filed a complaint with the Regional Trial Court (RTC) for damages with
prayer for the issuance of a temporary restraining order (TRO) or preliminary injunction against the
Bank. The Bank offered no objection to the issuance of a TRO since it claimed that it never prevented
DMI or its employees from entering or leaving the building. For this reason, the RTC directed the
Bank to allow DMI and the Lims to enter the building and get the things they left there. The latter
claimed, however, that on entering the building, they were unable to find the movable properties
they left there. In a supplemental complaint, DMI and the Lims alleged that the Bank surreptitiously
took such properties, resulting in additional actual damages to them of over P27 million.
The RTC rendered a decision in favor of DMI and the Lims. It ordered the Bank to pay the
plaintiffs P27,974,564.00 as actual damages, P500,000.00 as moral damages, P500,000 as exemplary
damages, and P100,000.00 as attorneys fees. The Bank moved for reconsideration of the decision,
questioning among other things the RTCs authority to grant damages considering plaintiffs failure to
pay the filing fees on their supplemental complaint. The RTC denied the motion. On appeal to the CA,
the latter found for the Bank, reversed the RTC decision, and dismissed the complaint as well as the
counterclaims. DMI and the Lims filed a motion for reconsideration but the CA denied the same,
hence this petition.
ISSUE:
Whether the RTC can award damages considering DMI and Lims’ failure to pay the filing fees
in the supplemental complaint against the Bank.
RULING:
NO. As to the damages that plaintiffs claim under their supplemental complaint, their stand
is that the RTC committed no error in admitting the complaint even if they had not paid the filing fees
due on it since such fees constituted a lien anyway on the judgment award. But this after-judgment
lien, which implies that payment depends on a successful execution of the judgment, applies to cases
where the filing fees were incorrectly assessed or paid or where the court has discretion to fix the
amount of the award. None of these circumstances obtain in this case.
Here, the supplemental complaint specified from the beginning the actual damages that the
plaintiffs sought against the Bank. Still plaintiffs paid no filing fees on the same. And, while petitioners
claim that they were willing to pay the additional fees, they gave no reason for their omission nor
offered to pay the same. They merely said that they did not yet pay the fees because the RTC had not
assessed them for it. But a supplemental complaint is like any complaint and the rule is that the filing
fees due on a complaint need to be paid upon its filing. The rules do not require the court to make
special assessments in cases of supplemental complaints.
To aggravate plaintiffs omission, although the Bank brought up the question of their failure to pay
additional filing fees in its motion for reconsideration, plaintiffs made no effort to make at least a late
payment before the case could be submitted for decision, assuming of course that the prescription of
their action had not then set it in. Clearly, plaintiffs have no excuse for their continuous failure to pay
the fees they owed the court. Consequently, the trial court should have treated their Supplemental
Complaint as not filed.
Litis Pendencia/Res Judicata (Forum Shopping)
HEIRS OF MAXIMINO DERLA, et. al v. HEIRS OF CATALINA DERLA VDA. DE HIPOLITO, et al.
The rule of res judicata which forbids the reopening of a matter once judicially determined by
competent authority applies as well to the judicial and quasi-judicial acts of public, executive or
administrative officers and boards acting within their jurisdiction as to the judgments of courts having
general judicial powers.
The petitioners are the surviving heirs of the late Maximino Derla (Derla). With his first wife,
the late Leonora Padernal, Derla had two children, Zelda and Juna. His children by his second wife
and surviving widow Sabina Perlas were Geraldine, Aida, and Alma. Zelda acts as the petitioners'
attorney-in-fact. Catalina Vda. De Hipolito (Catalina) is Derla's cousin who was married to the late
Ricardo Hipolito (Hipolito), having one daughter, Mae Hipolito. Except for Vina U. Casaway, by virtue
of individual sales (fishpond) patents issued by the Department of Agriculture and Natural Resources
(DANR), are the registered owners of a 23.9-hectare fishpond area (the subject fishpond area) in
SitioBiyawa, Barrio Panabo, Municipality of Tagum, Davao.
Hipolito filed a fishpond application covered by Derla’s permit. Derla then filed his own
fishpond application, which the Director of Fisheries approved.Derla filed a complaint for the
declaration of nullity of transfer of right in a fishpond permit. However, Hipolito pursuant to R.A. No.
5743 filed Sales Application with the subject fishpond.The Court of Appeals then dismissed Derla’s
complaint. After some time after the EDSA Revolution, Catalina, the wife of Hipolito filed with the
Office of the President for the Revival of the Fishpond Sale Application. The OP decided that the
husband of Catalina complied with all the terms and conditions, hence, he acquired all the vested
rights. Derla filed a motion for reconsideration, which the OP denied.
Derla then filed before the RTC a complaint for annulment and cancellation of original
certificates of title filed. The RTC dismissed the petition. Derla elevated the case to the Court of
Appeals, the court dismissed the appeal. The case is elevated to the Supreme Court. Derla asset that
there can be no res judicata as the decision rendered by the Office of the President is null and void
for having overturned an earlier final and executory decision and not giving them opportunity to be
heard.
ISSUE:
Whether or not res judicata has set in the instant petition.
RULING:
YES. There can be no mistake as to the presence of all the elements of res judicata in this case.
The parties, although later substituted by their respective successors-in-interest, have been the same
from the very beginning and in all the proceedings affecting the subject fishpond area. The concerned
agencies and the lower courts have validly ruled on the rights to the subject fishpond area, the validity
of the documents covering it, and even the actions associated and related to it. The subject fishpond
area is undoubtedly the same subject matter involved in O.P. Case No. 4732 and the petition now
before us.
The similarity between the two causes of action cannot be impugned. The facts and evidence
which supported Catalina's petition for revival of Hipolito's fishpond sales application in O.P. Case
No. 4732 are the same facts and evidence now before us; hence, the difference of actions in the two
cases is of no moment. In O.P. Case No. 4732, the action was to revive Hipolito's fishpond sales
application, which, when granted, gave the respondents the right to the subject fishpond area,
eventually leading to their ownership over the same. The action in Civil Case No. 97-15, the case that
was elevated to become this petition, is for the nullification of the respondents' respective titles to
the subject fishpond area on the ground that the respondents have no right thereto. If we allow the
nullification of these titles on the ground presented by the petitioners, then we would also be
nullifying the decision in O.P. Case No. 4732, because it is the decision in that case which gave the
respondents the right to the subject fishpond area.
Notwithstanding the difference in the forms of the two actions, the doctrine of res judicata
still applies considering that the parties were litigating over the same subject fishpond area. More
importantly, the same contentions and evidence as advanced by the petitioners in this case were
already used to support their arguments in the previous cause of action. While it is true that this
Court has declared that the doctrine of res judicata applies only to judicial or quasi-judicial
proceedings, and not to the exercise of administrative powers, we have also limited the latter to
proceedings purely administrative in nature. Therefore, when the administrative proceedings take
on an adversary character, the doctrine of res judicata certainly applies.
PRESIDENTIALCOMMISSION ON GOOD GOVERNMENT (PCGG) v. SANDIGANBAYAN (Second

COMMERCIAL BANKING CORPORATION (RCBC)
The discontinuance of a case not on the merits does not bar another action on the same subject
matter. In other words, res judicata as a bar by prior judgment does not apply in a case decided not
judged upon the merits.
By virtue of Presidential Decree (P.D.) No. 1193, as amended by P.D. No. 1394, then President
Ferdinand E. Marcos authorized Tourist Duty Free Shops, Inc. (TDFSI) to establish, operate and
maintain duty and tax free stores at all international airports and seaports, as well as at selected
hotels, tourist resorts, and commercial or trading centers throughout the country. PCGG issued to
TDFSI a Sequestration Order and a subsequent a Freeze Order directing the Manager of RCBC to
freeze any withdrawals, transfers or remittances from the funds of TDFSI in the said bank. As a
countermeasure, TDFSI filed before the Court a Petition for Certiorari, Prohibition and Injunction
with Preliminary Injunction and/or Restraining Order to annul and stop the enforcement of the
Sequestration Order. In that case, the Court ruled in favor of PCGG without prejudice to the filing of a
case before the Sandiganbayan. The resolution had become final and executory.
Meanwhile, TDFSI filed a Complaint for Injunction and Specific Performance with Prayer for
Issuance of Restraining Order and/or Preliminary Mandatory and Prohibitory Injunction against the
PCGG, Bank of America (BA) and RCBC before the Sandiganbayan which was dismissed. When
elevated to the Court, the latter reversed and set it aside. Consequently, the case was remanded for
further proceedings. The Sandiganbayan issued the first assailed Resolution granting TDFSIs motion
for the issuance of a writ of preliminary mandatory and prohibitory injunction. While recognizing the
PCGGs authority to issue the Sequestration Order to carry out its vital task of recovering justly and
expeditiously ill-gotten wealth, the Sandiganbayan found that the continued implementation of said
Order would greatly cause irreparable damage to TDFSI.
Aggrieved, the PCGG filed an Urgent Motion to Recall the Writ and a Motion for
Reconsideration. The Sandiganbayan then ordered to hold in abeyance the resolution of the motions
named in the preceding paragraph and other related incidents. In the same resolution, the court
suspended the implementation of the writ. On January 23, 2002, the Sandiganbayan later denied
PCGG’s motion for reconsideration. On even date, the Sandiganbayanset the case for pre-trial, and for
trial. Hence, this petition for certiorari.
ISSUE:
Whether or not res judicata applies in this case, considering the prior dismissal by this Court
of TDFSI’s petition to stop the enforcement of the Sequestration Order.
RULING:
NO. The Court’s resolution relied upon by PCGG clearly states that it merely disposed of the
preliminary issue of whether or not the Court should grant TDFSIs prayer for the issuance of a
temporary restraining order against the PCGGs Sequestration and Freeze Orders. It appears that after
the issuance of the above resolution and upon the issuance of Executive Order No. 14 vesting the
Sandiganbayan with the exclusive and original jurisdiction over ill-gotten wealth cases to be
prosecuted by the PCGG with the assistance of the Office of the Solicitor General, TDFSI filed a petition
to dismiss the case which the Court granted. Apparently, the case was dismissed by the Court without
prejudice to its re-filing with the Sandiganbayan. Clearly, there is no final determination yet of the
validity of the assailed Sequestration and Freeze Orders. The said Resolution relied on by PCGG is
only an interlocutory order and an incident of the dismissed case. PCGG cannot therefore rely on the
principles of res judicata, litis pendentia or law of the case.
As the dismissal was without prejudice, it was not a judgment on the merits. A judgment on
the merits is one rendered after a determination of which party is right, as distinguished from a
judgment rendered upon some preliminary or formal or merely technical point. In other words, the
discontinuance of a case not on the merits does not bar another action on the same subject matter.
To be sure, the provisional remedy, like any other interlocutory order, cannot survive the
main case of which it is but an incident. The findings of fact and opinion of a court when issuing (or
denying) the writ of preliminary injunction are interlocutory in nature and made even before the trial
on the merits is commenced or terminated[ Thus, the interlocutory order of the Court died with the
dismissal of the main case. The right of TDFSI to re-file the main case carries with it its right to apply
for the provisional remedies available under the Rules of Court.
ASIA UNITED BANK, CHRISTINE T. CHAN, AND FLORANTE C. DEL MUNDO v. GOODLAND
COMPANY, INC.
G.R. No. 191388, March 9, 2011, FIRST DIVISION (Del Castillo, J.)
One of the ways forum shopping can be committed is the filing of multiple cases based on the same
cause of action, but with different prayers or splitting causes of action, where the ground for dismissal is also
either litis pendentia or res judicata.
Goodland Company, Inc. (Goodland) executed a Real Estate Mortgage (REM) over two parcels
of land in favor of Asia United Bank (AUB). Goodland then filed a complaint Regional Trial Court
(RTC) for the annulment of the REM on the ground that the same was falsified and done in
contravention of the parties verbal agreement (annulment case). While the annulment case was
pending, RMNI defaulted in the payment of its obligation to AUB, prompting the latter to exercise its
right under the REM to extrajudicially foreclose the mortgage. The mortgaged properties were sold
in public auction to AUB as the highest bidder. Before AUB could consolidate its title, Goodland filed
another complaint before the RTC against AUB and its officers, Christine Chan (Chan) and Florante
del Mundo (del Mundo). It sought to annul the foreclosure sale and to enjoin the consolidation of title
in favor of AUB (injunction Case), asserting the alleged falsified nature of the REM. A few days
later, AUB consolidated its ownership over the foreclosed properties and obtained new titles in its
name. AUB, Chan and del Mundo then filed a Motion to Dismiss with Opposition to a Temporary
Restraining Order in the Injunction Case. They brought to the RTC’s attention Goodland’s forum
shopping given the pendency of the annulment case. They argued that the two cases both rely on the
alleged falsification of the real estate mortgage as basis for the reliefs sought.
ISSUE:
Whether or not the filing of the annulment and injunction cases constitute forum shopping.
RULING:
YES. There is forum shopping when a party repetitively avails of several judicial remedies in
different courts, simultaneously or successively, all substantially founded on the same transactions
and the same essential facts and circumstances, and all raising substantially the same issues either
pending in or already resolved adversely by some other court. Forum shopping can be committed in
three ways: (1) filing multiple cases based on the same cause of action and with the same prayer, the
previous case not having been resolved yet (where the ground for dismissal is litis pendentia); (2)
filing multiple cases based on the same cause of action and the same prayer, the previous case having
been finally resolved (where the ground for dismissal is res judicata); and (3) filing multiple cases
based on the same cause of action, but with different prayers (splitting causes of action, where the
ground for dismissal is also either litis pendentia or res judicata).
The cause of action in the annulment case is the alleged nullity of the REM is allegedly
violative of Goodland’s right to the mortgaged property. It serves as the basis for the prayer for the
nullification of the REM. The injunction case involves the same cause of action, inasmuch as it also
invokes the nullity of the REM as the basis for the prayer for the nullification of the extrajudicial
foreclosure and for injunction against consolidation of title. While the main relief sought in the
annulment case is ostensibly different from the main relief sought in the injunction case, the cause of
action which serves as the basis for the said reliefs remains the same the alleged nullity of the
REM. Thus, what is involved here is the third way of committing forum shopping, i.e., filing multiple
cases based on the same cause of action, but with different prayers. As previously held by the Court,
there is still forum shopping even if the reliefs prayed for in the two cases are different, so long as
both cases raise substantially the same issues.
BANK OF THE PHILIPPINE ISLANDS v. PIO ROQUE S. COQUIA, JR.

Res judicata dictates that a judgment on the merits rendered by a court of competent
jurisdiction operates as an absolute bar to a subsequent action involving the same cause of action since
that judgment is conclusive not only as to the matters offered and received to sustain it but also as to
any other matter which might have been offered for that purpose and which could have been adjudged
therein; the principle of immutability of final judgment renders it unalterable as nothing further can be
done except to execute it.
Pio Roque Coquia (Coquia), a senior manager in Bank of the Philippine Islands (BPI) branch,
alleged that he was instructed to take a vacation leave on account of an internal audit to be conducted
in BPI Branch. Two days after he returned to work, he was asked to continue his leave of absence
until the auditors shall have concluded their examination. In a notice, he was placed under preventive
suspension for 30 days due to further investigation of the various irregularities found to have been
committed by him. Coquia received a show cause memo directing him to explain in writing why no
disciplinary action should be taken against him for committing serious offenses/violations of bank
policies on the basis of the internal auditor’s findings. He was also advised in the memo that a hearing
will be held to give him an opportunity to ventilate his side. A Notice of Termination was served on
Coquia. Thus, he filed a complaint for illegal dismissal against BPI.
The Labor Arbiter (LA) ruled in favor Coquia and awarded damages in his favor, but the same
was reversed by the National Labor Relations Commission (NLRC). The Court of Appeals (CA) denied
Coquia’s appeal and sustained the NLRC’s deletion of the award of backwages and moral and
exemplary damages. The CA likewise sustained the award of separation pay as reinstatement was no
longer possible due to strained relation between petitioner BPI and Coquia. BPI now submits that the
CA acted in excess of its jurisdiction in ruling that Coquia is entitled to separation pay because its
jurisdiction is confined only to the lone issue of whether the deletion of the award of damages and
attorney’s fees was proper. BPI also argues that the propriety of the payment of separation pay is the
subject matter of an earlier petition it filed, so that the portion granting such award in favor of
respondent Coquia should not be binding on the parties. At any rate, according to BPI, the CA ruling
on the matter is erroneous since Coquia’s acts of fraud and dishonesty amounted to serious
misconduct and breach of trust and confidence which justify his dismissal and do not give him the
right to separation pay.
ISSUE:
Whether or not Coquia is entitled to separation pay.
RULING:
NO. BPI’s prayer to set aside the award of separation pay is barred by the principle of res
judicata. In its concept as a bar by prior judgment under Section 47(b) of Rule 39 of the Rules of Court,
res judicata dictates that a judgment on the merits rendered by a court of competent jurisdiction
operates as an absolute bar to a subsequent action involving the same cause of action since that
judgment is conclusive not only as to the matters offered and received to sustain it but also as to any
other matter which might have been offered for that purpose and which could have been adjudged
therein.
In this case, CA rendered a decision holding the dismissal of Coquia as legal since violations
of bank’s policies, rules and regulations, amount to an abuse of the trust reposed in him by his
employer. As a result, the NLRC’s award of separation pay and accumulated leave credits were
reversed and set aside. However, the CA, on equitable grounds, still granted Coquia financial
assistance for his 26 years of service to the bank. This decision became final and executor. Therefore,
in view of this significant development, BPI’s prayer to set aside the award of separation pay in favor
of Coquia has already become moot as the same has already been set aside in the CA decision which
had long become final and executory.
Thus, the Court may not pass upon the same issues which had been finally adjudicated since
a final and executory judgment can no longer be attacked by any of the parties or be modified, directly
or indirectly, even by the Supreme Court. This principle of immutability of final judgment renders it
unalterable as nothing further can be done except to execute it. A judgment must be final at some
definite time as it is only proper to allow the case to take its rest on grounds of public policy and
sound practice. Although there are recognized exceptions to this fundamental principle, such as nunc
pro tunc entries, void judgments and cases which would not cause any prejudice to any party, none
of these exceptions obtain in this case.
JOHN ANTHONY B. ESPIRITU, et al. v. MANUEL N. TANKIANSEE et al.

There is forum shopping when two or more actions or proceedings, founded on the same cause,
are instituted by a party on the supposition that one or the other court would make a favorable
disposition. Where a partys petition for certiorari and subsequent appeal seek to achieve one and the
same purpose, there is forum shopping which is a sufficient ground for the dismissal of
the certiorari petition.
John Anthony B. Espiritu, for himself and as attorney-in-fact of Westmont Investment

Corporation, et al. filed a Petition for Issuance of Shares of Stock and/or Return of Management and
Control with the against United Overseas Bank Limited et al., (UOBP Group). Subsequently, Manuel
N. Tankiansee et al. filed a Motion for Leave to Intervene and to Admit Attached Petition-In-
Intervention. The Espiritu group filed a Notice to Take Deposition. The trial court denied the motion
for production of documents and notice to take depositions because, as modes of discovery, the same
were filed beyond the 15-day reglementary period.
The Espiritu Groups filed a petition for certiorari before the Court of Appeals (CA) challenging
the validity of the Order for having been issued with grave abuse of discretion. Meanwhile, while this
case was pending resolution before the appellate court or on February 2, 2004, the trial court
rendered a Decision in the main case. From this judgment, Espiritu group, except Westmont
Investment Corporation, filed a notice of appeal. For its part, Westmont Investment Corporation filed
an Ex Abundanti Ad Cautelam Notice of Appeal and a Petition for Certiorari and Mandamus.
Tankiansee claim that Espiritu et al. are guilty of forum shopping. On February 2, 2004, the
trial court rendered a summary judgment in the main case. Espiritu’s, except Westmont Investment
Corporation, thereafter filed a notice of appeal. Westmont Investment Corporation chose to file an ex
abundant ad cautelam notice of appeal and a petition for certiorari and mandamus. All three cases
seek to annul the February 2, 2004 Decision of the trial court. According to Tiankiansee, the present
recourse has the same objective, that is, to reopen the trial courts February 2, 2004 Decision which
is pending review before the Court of Appeals. Considering that Espiritu et al. have a commonality of
interest, the splitting of the causes of action on the same cause is tantamount to forum shopping.
ISSUE:
Whether or not there is forum shopping.
RULING:
YES. The appeal before the Court of Appeals is the appropriate and adequate remedy, and the
certiorari petition, subject matter of this case, constitutes forum shopping.As stated earlier, while this
case was pending review before the Court of Appeals or on February 2, 2004, the trial court rendered
a Decision in the main case. From this judgment, Espiritu et al., except Westmont Investment
Corporation, filed a notice of appeal. This case was now pending resolution before the appellate
court. For its part, Westmont Investment Corporation filed an Ex Abundanti Ad Cautelam Notice Of
Appeal and a Petition for Certiorari and Mandamus.
With these developments, the instant petition should be denied because (1) Espiritu et al.’s
appeal before the appellate court is the appropriate and adequate remedy, and (2)
the certiorari petition, subject matter of this case, constitutes forum shopping.
Espiritu et al.’s appeal and certiorari petition effectively seek to annul the February 2, 2004
Decision of the trial court. In their pending appeal before the appellate court, the latter argued, among
others, that they were unduly deprived of their right to avail of modes of discovery, specifically, the
deposition taking subject matter of this case. This is one of their arguments in their appeal which
prays for the annulment of the February 2, 2004 Decision on due process grounds. On the other hand,
Westmont who is also among the petitioners argued in their certiorari petition that the disallowance
of the taking of the subject depositions deprived them of the opportunity to bring to fore crucial
evidence determinative of this case. In fine, the appeal and certiorari petition raise similar
arguments and effectively seek to achieve the same purpose of annulling the February 2, 2004
Decision which petitioners Espiritu and Westmont perceive to be in gross error.
SOCIAL SECURITY COMMISSION v. RIZAL POULTRY and LIVESTOCK ASSOCIATION, INC., et al.
Res judicata applies which preclude the SSC from resolving anew the existence of employer-
employee relationship, which issue was previously determined in the NLRC case.
Alberto Angeles filed before the Social Security Commission (SSC) to compel Rizal Poultry
and Livestock Association, Inc. or BSD Agro Industrial Development Corporation to remit to the Social
Security System all contributions due for and in his behalf. Rizal Poultry et al. countered with a
Motion to Dismiss citing rulings of the National Labor Relations Commission and Court of Appeals
regarding the absence of employer-employee relationship between Angeles and Rizal Poultry et al.
The SSC did not take into consideration the decision of the NLRC. It denied the motion to
dismiss. According to SSC, while it is true that the parties before the NLRC and in this case are the
same, the issues and subject matter are entirely different. The labor case is for illegal dismissal with
demand for backwages and other monetary claims, while the present action is for remittance of
unpaid SSS contributions. In other words, although in both suits Rizal Poultry et al. invoke lack of
employer-employee relationship, the same does not proceed from identical causes of action as one is
for violation of the Labor Code while the instant case is for violation of the SSS Law.
ISSUE:
Whether or not res judicata applies so as to preclude the SSC from resolving anew the
existence of employer-employee relationship, which issue was previously determined in the NLRC
case.
RULING:
YES. Res judicata embraces two concepts: (1) bar by prior judgment and (2) conclusiveness
of judgment. There is bar by prior judgment when, as between the first case where the judgment was
rendered and the second case that is sought to be barred, there is identity of parties, subject matter,
and causes of action. Thus, if a particular point or question is in issue in the second action, and the
judgment will depend on the determination of that particular point or question, a former judgment
between the same parties or their privies will be final and conclusive in the second if that same point
or question was in issue and adjudicated in the first suit. Identity of cause of action is not required
but merely identity of issue.
Verily, the principle of res judicata in the mode of conclusiveness of judgment applies in this
case. The first element is present in this case. The NLRC ruling was affirmed by the Court of Appeals.
The NLRC case was clearly decided on its merits; likewise on the merits was the affirmance of the
NLRC by the Court of Appeals. With respect to the element of identity of parties, we hold that there
is substantial compliance. Further, an identity in the cause of action need not obtain in order to
apply res judicata by conclusiveness of judgment. An identity of issues would suffice. The mandatory
coverage under the Social Security Act is premised on the existence of an employer-employee
relationship. In the instant case, therefore, res judicata in the concept of conclusiveness of judgment
applies. The judgment in the NLRC case pertaining to a finding of an absence of employer-employee
relationship between Angeles and Rizal Poultry et al. is conclusive on the SSC case.
MAKING ENTERPRISES, INC. AND SPOUSES JOAQUIN TAMANO AND ANGELITA TAMANO v.
JOSE MARFORI AND EMERENCIANA MARFORI
G.R. No. 152239, 17 August 2011, FIRST DIVISION, (Villarama, Jr., J.)
Forum-shopping exists when two or more actions involve the same transactions, essential facts,
and circumstances; and raise identical causes of action, subject matter, and issues.
Jose F. Marfori (Marfori) acquired a five-storey commercial building, known as the Marsman
Building, from the Development Bank of the Philippines. As the land on which the building stood was
owned by the Philippine Ports Authority (PPA), Marfori entered into a contract of lease of the said lot
with the PPA. The contract was for a period of twenty-five years, renewable for a similar period, and
was subject to the condition that upon the expiration of lease, the building and all other
improvements found on the leased premises shall become the PPAs sole property. Marfori then
incurred huge expenses for the rehabilitation of the building and leased some portions of the building
to the PPA. Marfori executed a dacion en pago and assignment of rights transferring the ownership
of the Marsman Building to Making Enterprises, Inc., and spouses Joaquina and AngelitaTamano,on
the condition that Making would assume all of Marfori’s obligations.
Marfori’s wife, Emerenciana, alleged that she did not consent to the transfer of the Marsman
Building to Making. She claimed that the building is part of their conjugal property as it was acquired
during their marriage. She filed with the Regional Trial Court (RTC) a complaint for Recovery of
Ownership, Annulment of Contract with Damages, Receivership, Accounting and Preliminary
Injunction with Prayer for Restraining Order. The RTC denied the prayer for the issuance of a writ of
preliminary injunction and the application for receivership.
Emerenciana filed before the Court of Appeals (CA) a petition for certiorari and receivership
with prayer for preliminary injunction. The CA dismissed the petition for being insufficient in form and
substance. Spouses Tamano countered that respondents had lost all their rights to the building after
they ceded it to Making in 1987. They also charged respondents with forum shopping. They argued
that when Emerenciana’s application for a writ of preliminary injunction and receivership was
denied by the RTC, she appealed the denial to the CA. When she failed to obtain a favorable action,
she and her husband filed a petition with the Supreme Court involving the same subject matter and
the same issues as in Emerenciana’s earlier petition in the CA.
ISSUE:
Whether or not Spouses Marfori are guilty of forum shopping.
RULING:
YES. The petition for appointment of a receiver for the Marsman Building was originally filed
by Emerenciana before the RTC. The RTC denied the prayer for the issuance of a writ of preliminary
injunction and the application for receivership. Emerenciana filed a motion for reconsideration,
which was denied by the RTC. She then filed a petition for certiorari and receivership with prayer for
preliminary injunction before the CA. The petition was dismissed for being insufficient in form and
substance. She sought reconsideration of the dismissal, and her motion was likewise denied by the
CA. Records show that two days earlier, while Emerciana’s motion for reconsideration of the CA
resolution dismissing her petition was still pending resolution before the CA, she and her husband
filed with the Supreme Court a consolidated petition, praying for the appointment of a receiver over
the Marsman Building.
There is forum-shopping when as a result of an adverse decision in one forum, or in
anticipation thereof, a party seeks a favorable opinion in another forum through means other than
appeal or certiorari. Forum-shopping exists when two or more actions involve the same transactions,
essential facts, and circumstances; and raise identical causes of action, subject matter, and issues.
Applying the above test, there is no question that there is identity of parties, cause of action and
reliefs sought between the two cases pending before the CA and SC.
Verification
MAKILITO B. MAHINAY v. HON. IRENEO LEE GAKO, JR., Presiding Judge, RTC-Br.5, Cebu City
and JOCELYN B. SORENSEN
G.R. No. 165338, G.R. No. 179375, 28 November 2011, FIRST DIVISION (Del Castillo, J.)
Verification of pleading is not an empty ritual bereft of any legal importance. It is intended to
secure an assurance that the allegations contained in the pleading are true and correct; are not
speculative or merely imagined; and have been made in good faith. Nonetheless, non-compliance or a
defect in the verification does not necessarily render the pleading fatally defective. The court may order
its submission or correction or act on the pleading if the attending circumstances are such that strict
compliance with the Rule may be dispensed with in order that the needs of justice may be served
thereby.
Constantina H. Sanchez, Josefina H. Lopez and Susan Honoridez are the registered owners
(the owners) of a parcel of land known as Lot 5 located in Cebu City. Makilito Mahinay (Mahinay)
filed a complaint for specific performance against the owners and one Felimon Suarez (Suarez), to
compel them to convey Lot 5 to him. Mahinay alleged that in an earlier case he filed against the
owners, the parties therein arrived at a Compromise Agreement wherein the owners gave him
preferential right to buy a 200-square meter portion of Lot 5 on condition that he will withdraw said
case. The RTC rendered a Decision debunking the owner’s theory of equitable mortgage. The CA
affirmed the RTC Decision.
About a year later, Mahinay and Suarez filed a Joint Manifestation. To pave the way for the
complete implementation of the RTC’s final Decision and have Lot 5 registered in his name, Mahinay
filed an Omnibus Motion. The RTC, then already presided by Judge Gako, issued a Resolution granting
Mahinay’s motion. The branch sheriff placed Mahinay in actual and physical possession of the entire
Lot 5. However, the TCT could not be surrendered to him as the same was already in possession of
Sorensen by virtue of a Real Estate Mortgage executed by the owners subsequent to the filing of
Mahinay’s complaint. Mahinay filed a Motion to Issue an Order Directing Sorensen to turn over the
TCT to him. Judge Gako issued the assailed Resolution denying Mahinay’s motion. On petition for
certiorari, the CA dismissed the case n a Resolution promulgated on April 24, 2007, however, the CA
outrightly dismissed Sorensen’s petition for her failure to state that the allegations in her petition are
true and correct not only based on her personal knowledge but also based on authentic records.
Sorensen filed a Motion for Reconsideration and to remedy the defect in her petition submitted an
Amended Petition with corrected verification. But the CA was not moved by Sorensen’s subsequent
compliance and, consequently, denied her motion in a Resolution dated August 3, 2007. Hence, the
petition.
ISSUE:
Whether or not the CA erred in dismissing the petition for certiorari.
RULING:
NO. The CA did not err in dismissing Sorensen’s petition for certiorari. Sorensen admits that
due to inadvertence she failed to state in the verification portion of her petition that the allegations
therein are true and correct based on authentic records. Nonetheless, such omission, according to
Sorensen, does not justify the outright dismissal of her petition; and that after all, the absence of
verification is a mere formal, not jurisdictional, defect. She misses the point.
The rule requiring certain pleadings to be verified is embodied in Section 4, Rule 7 of the
Rules of Court. Verification of pleading is not an empty ritual bereft of any legal importance. It is
intended to secure an assurance that the allegations contained in the pleading are true and correct;
are not speculative or merely imagined; and have been made in good faith. A pleading may be verified
by stating that the pleaders have read the allegations in their petition and that the same are true and
correct based either on their personal knowledge or authentic records, or based both on their personal
knowledge and authentic records.
Nonetheless, the Rules and jurisprudence on the matter have it that the court may allow such
deficiency to be remedied. In Altres v. Empleo, this Court pronounced for the guidance of the bench
and the bar that non-compliance x xx or a defect [in the verification] does not necessarily render the
pleading fatally defective. The court may order its submission or correction or act on the pleading if
the attending circumstances are such that strict compliance with the Rule may be dispensed with in
order that the needs of justice may be served thereby. In this case, no circumstances were present in
Sorensen’s petition which would warrant the liberal application of the rules to serve the needs of
justice.
EDITO PAGADORA v. JULIETA S. ILAO

G.R. No. 165769,12 December 2011, THIRD DIVISION (PERALTA, J.)
Verification is merely a formal, not jurisdictional, requirement, affecting merely the form of the
pleading such that non-compliance therewith does not render the pleading fatally defective.
Julieta Ilao acquired, under a Contract to Sell, a piece of land. The contract stipulated that the
balance of the purchase price was payable upon proof by the vendee that the boundaries of the
property had already been relocated and that the fence thereon had been constructed. Hence,
immediately after the sale, Ilao as vendee had commissioned the survey of the property, but the work
had been stalled because, on several occasions, the occupant of the adjoining lot, herein petitioner
Pagadora, had allegedly prevented the surveyor from completing the task. When at length the work
was finished, Ilao then sought to fence off the property yet again, the work stood to a halt because
Pagadora, as was the case during the survey, allegedly hindered Ilao’s workers from completing the
work and even threatened them with bodily harm. Hence, Ilao filed a complaint for forcible entry. In
Pagadora’s Answer to the complaint, he pointed out that the complaint was infirm, lacking as it did
an exact reference on when the alleged forcible entry took place, and also because it did not state that
Ilao had been in physical possession of the disputed property prior to him. Accordingly, he prayed
for the dismissal of the case as the controversy did not fall under the MeTCs jurisdiction, the
allegations in the complaint being insufficient to constitute forcible entry.
The MeTC dismissed the complaint for Ilao’s failure to establish her cause of action for
forcible entry. The RTC reversed. The Court of Appeals (CA) only made short shrift of the appeal for
two reasons: first, the petition itself does not contain a written explanation on why a copy thereof
was served on Ilao by registered mail, instead of by the preferred mode of personal service
and, second, the attached verification did not comply with Section 4, Rule 7, as amended by A.M. No.
00-2-10-SC. Pagadora now assails the outright dismissal of his petition for review on a technicality,
and advocates for a liberal interpretation of the rules of procedure to better serve the ends of justice.
ISSUE:
Whether the CA erred in dismissing the appeal
RULING:
YES. It is settled that liberal construction of the rules may be invoked in situations where
there may be some excusable formal deficiency or error in a pleading, provided that the same does
not subvert the essence of the proceeding and it at least connotes a reasonable attempt at compliance
with the rules. A liberal application of procedural rules requires that: (1) there is justifiable cause or
plausible explanation for non-compliance and (2) there is compelling reason to convince the court
that the outright dismissal would seriously impair or defeat the administration of justice.
Verification is merely a formal, not jurisdictional, requirement, affecting merely the form of
the pleading such that non-compliance therewith does not render the pleading fatally defective. It is
simply intended to provide an assurance that the allegations are true and correct and not a product
of the imagination or a matter of speculation, and that the pleading is filed in good faith. The court
may in fact order the correction of the pleading if verification is lacking or it may act on the pleading
although it may not have been verified, where it is made evident that strict compliance with the rules
may be dispensed so that the ends of justice may be served. In the present case, Pagadora’s
subsequent compliance via his motion for reconsideration should also have inspired an attitude of
liberality.
FRANCIS BELLO, represented herein by his daughter and attorney-in-fact, Geraldine Bello-
Ona v. BONIFACIO SECURITY SERVICES, INC. and SAMUEL TOMAS
G.R. No. 188086, 2 August 2011, SECOND DIVISION, (Brion, J)
Verification is substantially complied with when one who has ample knowledge to swear to the
truth of the allegations in the complaint or petition signs the verification, and when matters alleged in
the petition have been made in good faith or are true and correct.
In July 2001, the BSSI hired Bello as a roving traffic marshal to manage traffic and to conduct
security and safety-related operations in the Bonifacio Global City.In October 2002, Bello was
assigned as roving traffic marshal at the BGC. On October 25, 2002, he filed an indefinite leave of
absence when his new assignment took effect.On November 5, 2002, Bello filed a complaint against
the BSSI and its General Manager, respondent Samuel Tomas, with the National Labor Relations
Commission, claiming that he had been constructively dismissed when he was demoted from a
detachment commander to a mere traffic marshal.
The Labor Arbiter found that Bello was illegally dismissed, noting that the BSSI failed to
adduce evidence that Bello abandoned his employment. The NLRC affirmed the labor arbiter’s
decision. On a petition for certiorari, The CA nullified the NLRC resolutions, finding the records bereft
of evidence substantiating the labor arbiters and the NLRCs conclusions that Bello had been
constructively dismissed.
ISSUE:
Whether or not the petition should be dismissed outright for defective verification
RULING:
NO. Verification of a pleading is a formal, not jurisdictional, requirement intended to secure

the assurance that the matters alleged in a pleading are true and correct.Thus, the court may simply
order the correction of unverified pleadings or act on them and waive strict compliance with the
rules. It is deemed substantially complied with when one who has ample knowledge to swear to the
truth of the allegations in the complaint or petition signs the verification, and when matters alleged
in the petition have been made in good faith or are true and correct.
In this case, we find that the petitions verification substantially complied with the
requirements of the rules. The SPA authorized Bello-Ona to represent Bello in the case
entitled Francis Bello v. Bonifacio Security Services, Inc. and/or Samuel Tomas, (CA) Case No. 047829-
06; NLRC-N[CR] Case No. 00-11-09529-2002 the case from which the present petition originated. As
the daughter of Bello, Bello-Ona is deemed to have sufficient knowledge to swear to the truth of the
allegations in the petition, which are matters of record in the tribunals and the appellate court below.
Summons
REPUBLIC OF THE PHILIPPINES, represented by the Department of Public Works and

Highways, through the Hon. Secretary, HERMOGENES EBDANE v. ALBERTO A. DOMINGO
G.R. No. 175299, 14 September 2011, FIRST DIVISION (Leonardo De Castro, J.)
Summons is a writ by which the defendant is notified of the action brought against him. Service
of such writ is the means by which the court acquires jurisdiction over his person. Jurisdiction over the
person of the defendant is acquired through coercive process, generally by the service of summons issued
by the court, or through the defendant's voluntary appearance or submission to the court. When the
defendant is the Republic of the Philippines, service may be effected on the Solicitor General
Alberto A. Domingo (Domingo) filed a Complaint for Specific Performance with

Damages against the Department of Public Works and Highways (DPWH), Region III, in the
RTC. Thereafter, summons was issued by the RTC. The Proof of Service of the Sheriff dated stated
that the summons was served through Nora Cortez, Clerk III of said DPWH office.
Subsequently, Domingo filed a Motion to Declare Defendant in Default in view of the failure
of the DPWH Region III to file a responsive pleading within the reglementary period. After hearing of
the said motion, the Regional Trial Court (RTC) declared the DPWH Region III in default. After the ex
parte presentation of Domingo’s evidence, the RTC rendered judgment in his favour. Thereafter,
Domingo filed a Motion for Issuance of Writ of Execution, asserting that the DPWH Region III failed
to file an appeal or a motion for new trial and/or reconsideration. The RTC granted the aforesaid
motion and a Writ of Execution was then issued. The Republic of the Philippines, represented by the
Office of the Solicitor General (OSG), filed with the Court of Appeals a Petition for Annulment of
Judgment with Prayer for the Issuance of a TRO Order and/or a Writ of Preliminary Injunction.
The Republic argued that it was not impleaded as an indispensable party in the civil case filed
against DPWH Region III; that the contracts sued upon were entered into by the Regional Director,
Assistant Regional Director and/or Project Manager of the DPWH Region III for and in behalf of the
Republic of the Philippines, which purportedly was the real party to the contract; that, under the law,
the statutory representatives of the government for purposes of litigation are either the Solicitor
General or the Legal Service Branch of the Executive Department concerned; that since no summons
was issued to either of said representatives, the trial court never acquired jurisdiction over the
Republic. The Court of Appeals (CA) dismissed the Republic’s Petition ruling, in essence, that the
aforesaid statutory representatives are not the only entities eligible to receive a summons on behalf
DPWH. The Republic filed a Motion for Reconsideration, but was denied. Hence, the instant petition.
ISSUE:
Whether or not the CA correctly dismissed the Petition for Annulment of Judgment filed by
the Republic.
RULING:
YES. Under the first paragraph of Section 2, Rule 47 of the Rules of Court, the annulment of a
judgment may be based only on the grounds of extrinsic fraud and lack of jurisdiction. As such, ‘lack
of jurisdiction’ refers to either lack of jurisdiction over the person of the defending party or over the
subject matter of the claim. Further, summons is a writ by which the defendant is notified of the
action brought against him. Service of such writ is the means by which the court acquires jurisdiction
over his person. Jurisdiction over the person of the defendant is acquired through coercive process,
generally by the service of summons issued by the court, or through the defendant's voluntary
appearance or submission to the court.
In the instant case, the Complaint filed by Domingo specifically named as defendant the
DPWH Region III. As correctly argued by the Republic, the DPWH and its regional office are merely
the agents of the former (the Republic), which is the real party in interest. Thus, as mandated by
Section 13, Rule 14 of the Rules of Court, the summons in this case should have been served on the
OSG. Domingo ought to bear in mind that it is the duty of the plaintiff to implead all the necessary or
indispensable parties for the complete determination of the action. It was, thus, incumbent upon him
to name and implead the proper defendant in this case, i.e., the Republic, and cause the service of
summons to be made upon the officer mandated by law, that is, the OSG. As Domingo failed to
discharge this burden, he cannot now be allowed to shift the blame on the DPWH Region III or hold
in estoppel the OSG.
Motion to Dismiss
SEVERINO S. CAPIRAL v. SIMEONA CAPIRAL ROBLES and VICENTE CAPIRAL

Insofar as hearings on a motion to dismiss are concerned, Section 2, Rule 16 of the Rules of Court
sanctions trial-type proceedings in the sense that the parties are allowed to present evidence and argue
their respective positions before the court
The instant petition arose from a Complaint for Partition with Damages filed with the RTC
of Malabon City by Simeona and Vicente against Severino and five other persons, all
surnamed Capiral, whom the former claims to be their co-heirs. Severino filed a Motion to
Dismiss. The Regional Trial Court (RTC) set the motion to dismiss for a trial-type hearing. Severino
filed a Motion to Resolve praying that an Order be issued by the RTC resolving the Motion to Dismiss.
The RTC denied this motion to resolve. Severino filed a Motion for Reconsideration (MR) contending
that there is no longer any need to set the case for hearing for the reception of evidence to prove the
allegations in the Motion to Dismiss considering that, in their Opposition, Simeona and Vicente failed
to deny nor rebut the material factual allegations in the said Motion. The RTC still denied the MR.
Thereafter, Severino filed a special civil action for certiorari with the Court of Appeals (CA),
arguing that the RTC is guilty of grave abuse of discretion in issuing the abovementioned Orders. The
CA dismissed the petition. Like, his MR was denied. Hence, this petition.
ISSUE:
Whether or not the CA erred when it held that the trial-type hearing required by the RTC for
the resolution of the motion to dismiss is in accord with Section 2, Rule 16 of the Rules of Court.
RULING:
NO. Insofar as hearings on a motion to dismiss are concerned, Section 2, Rule 16 of the Rules
of Court sanctions trial-type proceedings in the sense that the parties are allowed to present evidence
and argue their respective positions before the court.
Issues raised in a motion to dismiss have to be determined in accordance with the evidence
and facts presented, not on the basis of unsubstantiated allegations and that the courts could not
afford to dismiss a litigant's complaint on the basis of half-baked conclusions with no evidence to
show for it. In emphasizing the need for a formal hearing, this Court held that the demand for a clear
factual finding to justify the grant or denial of a motion to dismiss cannot be dispensed with. To this
end, Section 2, Rule 16 of the Rules of Court allows not only a hearing on the motion to dismiss, but
also for the parties to submit their evidence on the questions of fact involved, which may be litigated
extensively at the hearing or hearings on the motion. During the said hearings, the parties are allowed
to submit their respective evidence, and even rebut the opposing parties' evidence.
ORLANDO A. RAYOS, et. al v. THE CITY OF MANILA

G.R. No. 196063,14 December 2011, SECOND DIVISION (CARPIO, J.)
An order denying a motion to dismiss is interlocutory and not appealable. An order denying a
motion to dismiss does not finally dispose of the case, and in effect, allows the case to proceed until the
final adjudication thereof by the court. In case of denial of an interlocutory order, the immediate remedy
available to the aggrieved party is to file a special civil action for certiorari under Rule 65 of the Rules
of Court.
The City of Manila filed a complaint for eminent domain filed against Remedios V.
De Caronongan, et al. The City of Manila alleged that it passed Ordinance No. 7949 authorizing the
City Mayor to acquire by expropriation, negotiation or by any other legal means the parcel of land co-
owned by De Caronongan, et al. for P1,000.00 per square meter. De Caronongan, et al. conveyed their
willingness to sell the property to the City of Manila, but at the price of P50,000.00 per square meter
which they claimed was the fair market value of the land at the time. Orlando Rayos, et al. filed a
Motion to Dismiss on the grounds that Ordinance No. 7949 is unconstitutional. The trial court denied
the motion to dismiss. Rayos, et al. then filed this petition, captioned as a petition for review on
certiorari and declaratory relief.
ISSUE:
Whether Rayos et al. availed of the proper remedy.
RULING:
NO. An order denying a motion to dismiss is interlocutory and not appealable. An order
denying a motion to dismiss does not finally dispose of the case, and in effect, allows the case to
proceed until the final adjudication thereof by the court. In case of denial of an interlocutory order,
the immediate remedy available to the aggrieved party is to file a special civil action
for certiorari under Rule 65 of the Rules of Court.
Even if the Court treats the present petition as a petition for certiorari under Rule 65, which
is the proper remedy to challenge the order denying the motion to dismiss, the same must be
dismissed for violation of the principle of hierarchy of courts. Likewise, assuming the present petition
is one for declaratory relief, this Court has only appellate, not original, jurisdiction over such a
petition.
While this Court may treat a petition for declaratory relief as one for prohibition or
mandamus, over which this Court exercises original jurisdiction, it must be stressed that this special
treatment is undertaken only in cases with far reaching implications and transcendental issues that
need to be resolved, which is absent in this case.
Dismissal of Actions
PHILIPPINE CHARTER INSURANCE CORPORATION v. EXPLORER MARITIME CO., LTD., OWNER

OF THE VESSEL M/V EXPLORER, et al.
The failure of the plaintiff to prosecute the action without any justifiable cause within a
reasonable period of time will give rise to the presumption that he is no longer interested in obtaining
the relief prayed for. Consequently, the Complaint may be dismissed even absent any allegation and proof
of the plaintiff's lack of interest to prosecute the action, or of any prejudice to the defendant resulting
from the failure of the plaintiff to comply with the rules.
Philippine Charter Insurance Corporation (PCIC), as insurer-subrogee, filed with the Regional
Trial Court (RTC) a Complaint against the unknown owner of the vessel M/V Explorer (common
carrier), Wallem Philippines Shipping, Inc. (ship agent), Asian Terminals, Inc. (arrastre), and
Foremost International Port Services, Inc. (broker). PCIC sought to recover the value of lost or
damaged shipment it paid to the insured.
Foremost International Port Services, Inc. filed a Motion to Dismiss, which was later denied
by the trial court. The Unknown Owner of the vessel M/V Explorer, and Wallem Philippines Shipping,
Inc. filed a Motion to Dismiss on the ground that PCIC failed to prosecute its action for an
unreasonable length of time. PCIC allegedly filed its Opposition, claiming that the trial court has not
yet acted on its Motion to Disclose. In said motion, PCIC supposedly prayed for the trial court to order
Wallem Philippines Shipping, Inc. to disclose the true identity and whereabouts of defendant
Unknown Owner of the Vessel M/V Explorer.
The trial court issued an Order dismissing the civil case for failure of PCIC to prosecute for an
unreasonable length of time. Upon receipt of the order of dismissal, PCIC allegedly realized that its
Motion to Disclose was inadvertently filed with another branch of the RTC of Manila, where the
similar case involving the vessel M/V Taygetus was raffled to, and not with the branch where the
present case was pending. Thus, PCIC filed a Motion for Reconsideration (MR) which was
subsequently denied. The Court of Appeals (CA) affirmed and denied the subsequent MR. Hence, this
Petition for Review on Certiorari.
ISSUE:
Whether or not the CA erred in affirming the trial court’s dismissal of the case on the ground
of failure to prosecute.
RULING:
YES. The basis for the dismissal by the trial court is Section 3, Rule 17 and Section 1, Rule 18
of the Rules of Court. In the fairly recent case of Espiritu v. Lazaro, the Court, in affirming the dismissal
of a case for failure to prosecute on account of the omission of the plaintiff therein to move to set the
case for pre-trial for almost one year from their receipt of the Answer, issued several guidelines in
effecting such dismissal:
It bears stressing that the sanction of dismissal may be imposed even absent
any allegation and proof of the plaintiff's lack of interest to prosecute the action, or of
any prejudice to the defendant resulting from the failure of the plaintiff to comply
with the rules. The failure of the plaintiff to prosecute the action without any
justifiable cause within a reasonable period of time will give rise to the presumption
that he is no longer interested in obtaining the relief prayed for.
In the case at bar, the alleged Motion to Disclose was filed on November 19,
1997. Respondents filed the Motion to Dismiss on December 5, 2000. By that time, PCICs inaction was
thus already almost three years. There is therefore no question that the failure to prosecute in the
case at bar was for an unreasonable length of time. Consequently, the Complaint may be dismissed
even absent any allegation and proof of the plaintiff's lack of interest to prosecute the action, or of
any prejudice to the defendant resulting from the failure of the plaintiff to comply with the rules. The
burden is now on PCIC to show that there are compelling reasons that would render the dismissal of
the case unjustified.
The only explanation that the PCIC can offer for its omission is that it was waiting for the
resolution of its Motion to Disclose, which it allegedly filed with another branch of the
court. According to PCIC, it was premature for it to move for the setting of the pre-trial conference
before the resolution of the Motion to Disclose. The Court however disagree. Explorer Maritime Co.,
Ltd., which was then referred to as the Unknown Owner of the vessel M/V Explorer, had already been
properly impleaded pursuant to Section 14, Rule 3 of the Rules of Court.
Pre-Trial
TRINIDAD ALICER, et. al v. ALBERTO COMPAS, et al.

G.R. No. 187720, 30 May 2011, SECOD DIVISION (Carpio, J.)
Under Section 5, Rule 18 of the Rules of Civil Procedure, non-appearance of the defendant at the
pre-trial conference allows the plaintiff to present his evidence ex parte
The instant petition stems from the complaint filed by Alberto Compas against Winefreda
Pineda, et. al before the Regional Trial Court (RTC), for Reconveyance of Title and damages. After all
the answers have been filed and preliminary matters disposed of, the court a quo set the pre-trial
conference. However, prior to the March 13-14, 2003 pre-trial conference, counsel for Alberto
Compas moved for the postponement of the hearings to March 20-21, 2003 on the ground of prior
commitment. Likewise on the same ground, Trinidad Alicer, et. al through counsel moved for
postponement of the trial dates given to them.
It appears that both motions for postponement did not reach the trial court on time hence the
case was still called for hearing on March 13, 2003. On the said date only the following parties were
in attendance: Edgar Selda and his counsel Atty. Alexander Ang, Rural Bank of Carigara (Leyte) and
its counsel Atty. Nilo Aldrin Lucinario and Trinidad Alicer and one of her counsels Atty. Samuel
Lagunzad. Incidentally, the pre-trial conference was rescheduled to June 5, 2003 which was once
more reset to July 25, 2003. When the case was called for pre-trial on July 25, 2003, all parties were
present except for Trinidad Alicer and the heirs of Arturo Alicer and their counsel/s. Upon motion of
counsel for the plaintiff, Compas, et. al were declared in default by the court a quo. Afterward, pre-
trial proceeded and after which a pre-trial order was issued by the trial court of even date. Thereafter,
trial of the case ensued.
Trinidad Alicer, et. al. filed a Motion to Lift Default Order dated July 25, 2003 alleging inter
alia that they did not receive a notice of the pre-trial scheduled on July 25, 2003, which motion was
denied by the trial court on February 23, 2005 for insufficiency in form and substance of the motion
and for not being accompanied by an affidavit of merit. A motion for reconsideration thereon was
also denied on May 12, 2005, hence the instant petition for certiorari. Alicer, et. al filed with the Court
of Appeals (CA) a petition for certiorari, alleging that they did not receive a resolution from the trial
court denying or granting their motion for postponement dated 8 March 2003. The CA however
denied the petition.
ISSUE:
Whether or not the CA erred in affirming the order of the trial court declaring Alicer, et. al in
de fault.
RULING:
NO. In this case, the trial court declared petitioners in default for failing to attend the pre-trial
conference. Under Section 5, Rule 18 of the Rules of Civil Procedure, non-appearance of the defendant
at the pre-trial conference allows the plaintiff to present his evidence ex parte.
The Court agreed with the CA in sustaining the default order of the trial court. There was no
grave abuse of discretion on the part of the trial court in declaring petitioners in default because they
failed to appear during the pre-trial conference. The findings of fact of the Court of Appeals,
specifically that petitioners were served notice of the pre-trial conference, is conclusive upon this
Court which is limited to reviewing errors of law. Besides, petitioners cannot claim that they were
denied substantial justice considering that they can still appeal the judgment of the trial court on the
main case, which they did.
NATIONAL POWER CORPORATION, represented by its President CYRIL DEL CALLAR v. JUDGE
SANTOS B. ADIONG, RTC, BRANCH 8, MARAWI CITY
A.M. No.RTJ-07-2060, 27 July 2011 FIRST DIVISION (Villarama, J.)
It is elementary and plain that the holding of such a pre-trial conference is mandatory and
failure to do so is inexcusable.
An administrative complaint was filed by the National Power Corporation against Judge
Santos B. Adiong (Judge Adiong) for gross ignorance of the law, manifest partiality and conduct
unbecoming a member of the Judiciary. In one of the cases filed by NPC, Judge Adiong failed to
conduct a pre-trial conference and erred in conducting the series of hearings in the case without
determining the existence of necessary pre-conditions before the court could take cognizance of the
case.
ISSUE:
Whether or not Judge Adiong is administratively liable for failing to conduct a pre-trial
conference.
RULING:
YES. Judge Adiong failed to conduct a pre-trial conference contrary to elementary rules of
procedure which he should have known all too well considering his long years of service in the bench.
The mandatory character of pre-trial is embodied in Administrative Circular No. 3-99 dated January
15, 1999, and found its way in Section 2, Rule 18 of the Rules of Court, which imposes a duty upon
the plaintiff to promptly move ex parte that the case be set for pre-trial. To further implement the
pre-trial guidelines, this directive was reiterated in Administrative Matter No. 03-1-09-SC entitled
Guidelines to be Observed by Trial Court Judges and Clerks of Court in the Conduct of Pre-Trial and
Use of Deposition-Discovery Measures which recognized the importance of pre-trial and the
deposition-discovery measures as vital components of case management in trial courts.
To further show that the Court is serious in implementing the rules on pre-trial, in Alviola v.
Avelinothe Court imposed the penalty of suspension on a judge who merely failed to issue a pre-trial
order within ten (10) days after the termination of the pre-trial conference as mandated by
Paragraph 8, Title I (A) of A.M. No. 03-1-09-SC.
Here, Judge Adiong failed to conduct the pre-trial conference itself. It is elementary and plain
that the holding of such a pre-trial conference is mandatory and failure to do so is inexcusable. When
the law or procedure is so elementary, such as the provisions of the Rules of Court, not to know it or
to act as if one does not know it constitutes gross ignorance of the law. Such ignorance of a basic rule
in court procedure, as failing to conduct pre-trial, sadly amounts to gross ignorance and warrants a
corresponding penalty.
Computation of Time
SPOUSES RUBEN and MYRNA LEYNES v. FORMER TENTH DIVISION OF THE COURT OF
APPEALS, et al.
G.R. No. 154462, 19 January 2011, FIRST DIVISION (LEONARDO-DE CASTRO, J.)
In computing said 10-day period, non-working days (Saturdays, Sundays, and legal holidays)
are excluded from the counting of the period only when the last day of the period falls on such days. Rule
22 does not provide for any other circumstance in which non-working days would affect the counting of
a prescribed period.
A complaint for forcible entry, damages, and attorney’s fees was filed by spouses Superales
against the spouses Leynes before the Municipal Circuit Trial Court (MCTC). Summons together with
a copy of the aforementioned Complaint was served on the spouses Leynes on May 10, 2000, giving
them ten (10) days from receipt within which to file their answer pursuant to Section 6 of the Rules
on Summary Procedure. The 10-day period for the filing of the spouses Leynes answer prescribed on
May 20, 2000, a Saturday.The spouses Leynes filed their Answer with Counterclaim on May 22, 2000.
The MCTC rendered its Judgment denying the spouses Leynes Motion to Admit Belatedly
Filed Answer and resolving the case entirely in the spouses Superales favor, which the Regional Trial
Court (RTC) affirmed. The spouses Leynes then filed a Petition for Certiorari with the Court of
Appeals (CA) which dismissed the spouses Leynes petition outright for being the wrong remedy and
for failure to state the material dates. Spouses Leynes filed the instant Petition for Certiorari charging
the CA, as well as the RTC and the MCTC, with grave abuse of discretion.
ISSUE:
Whether the MCTC was correct in not admitting the answer for having been filed out of time.
RULING:
NO. In computing said 10-day period, non-working days (Saturdays, Sundays, and legal
holidays) are excluded from the counting of the period only when the last day of the period falls on
such days. Rule 22 does not provide for any other circumstance in which non-working days would
affect the counting of a prescribed period.
In the instant case, the last day of the 10-day period within which the spouses Leynes should
have filed their answer, May 20, 2000, fell on a Saturday. The next working day was May 22, 2000, a
Monday, on which the spouses Leynes did file their Answer with Counterclaim. Based on the
aforequoted rules, the spouses Leynes answer was filed within the reglementary period, and they
were not in default. The MCTC should not have rendered an ex parte Judgment against them.
Judgment
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) v. GROUP MANAGEMENT CORPORATION

(GMC) AND LAPU-LAPU DEVELOPMENT & HOUSING CORPORATION (LLDHC)
G.R. No. 167000/ G.R. No. 169971, 8 June 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Supervening events refer to facts which transpire after judgment has become final and
executory or to new circumstances which developed after the judgment has acquired finality, including
matters which the parties were not aware of prior to or during the trial as they were not yet in existence
at that time.
Lapu-Lapu Development & Housing Corporation (LLDHC) was the registered owner of
seventy-eight (78) lots situated in Barrio Marigondon, Lapu-Lapu City. LLDHC and the Government
Service Insurance System (GSIS) entered into a Project and Loan Agreement for the development of
the subject lots. For LLDHC's failure to fulfill its obligations, GSIS foreclosed the mortgage. Group
Management Corporation (GMC) offered to purchase on installments the subject lots from GSIS. GSIS
accepted the offer and executed a Deed of Conditional Sale over the subject lots.
LLDHC filed a complaint for Annulment of Foreclosure with Writ of Mandatory Injunction
against GSIS before the Regional Trial Court (RTC) of Manila. It rendered a decision contending that
GSIS was unable to prove the alleged violations committed by LLDHC to warrant foreclosure of the
mortgage. Meanwhile, GMC filed its own motion before Lapu-Lapu RTC who rendered a decision-
ordering defendant LLDHC to execute the final deed of absolute sale. Armed with the decision
rendered by RTC Manila, LLDC filed before the Court of Appeals (CA) a petition for annulment of
judgment of Lapu-Lapu RTC. The CA dismissed the petition. Hence, the petition.
ISSUE:
Whether or not the decision of RTC Manila can be considered as a supervening event.
RULING:
NO. It is well-settled that once a judgment attains finality, it becomes immutable and
unalterable. It may not be changed, altered or modified in any way even if the modification were for
the purpose of correcting an erroneous conclusion of fact or law. This is referred to as the "doctrine
of finality of judgments," and this doctrine applies even to the highest court of the land.
Both GSIS and LLDHC claim that the execution of the decision and orders in Civil Case No.
2203-L should be stayed because of the occurrence of "supervening events" which render the
execution of the judgment "impossible, unfair, unjust and inequitable." However, in order for an
event to be considered a supervening event to justify the alteration or modification of a final
judgment, the event must have transpired after the judgment has become final and executor. Since
the Manila RTC decision does not constitute a supervening event, there is therefore neither reason
nor justification to alter, modify or annul the Lapu-Lapu RTC Decision and Orders, which have long
become final and executory. Thus, in the present case, GMC must not be deprived of its right to enjoy
the fruits of a final verdict.
JOEB ALIVIADO, et. al v. PROCTER & GAMBLE PHILS., INC., et al.

The filing by P&G of several pleadings after receipt of the resolution denying its first motion for
reconsideration does not in any way bar the finality or entry of judgment.
On March 9, 2010, the Supreme Court rendered a Decision holding: (a) that Promm-Gem, Inc.
(Promm-Gem) is a legitimate independent contractor; (b) that Sales and Promotions Services (SAPS)
is a labor-only contractor consequently its employees are considered employees of Procter & Gamble
Phils., Inc. (P&G); (c) that Promm-Gem is guilty of illegal dismissal; (d) that SAPS/P&G is likewise
guilty of illegal dismissal; (e) that petitioners are entitled to reinstatement; and (f) that the dismissed
employees of SAPS/P&G are entitled to moral damages and attorney’s fees there being bad faith in
their dismissal.
P&G filed a Motion for Reconsideration, an Opposition. On the other hand, Aliviado, et. al.
filed a Motion for Partial Reconsideration and Comment to P&G’s motion, which was denied. Entry of
Judgment was made on July 27, 2010. Before any of the parties received the notice of Entry of
Judgment, P&G filed on a Motion for Leave to File Motion to Refer the Case to the Supreme Court En
Banc with Second Motion for Reconsideration and Motion for Clarification and a Motion to Refer the
Case to the Supreme Court En Banc with Second Motion for Reconsideration and Motion for
Clarification.
Thereafter, P&G filed a Manifestation and Motion praying that its Motion for Leave to File
Motion to Refer the Case to the Supreme Court En Banc with Second Motion for Reconsideration and
Motion for Clarification be granted.
ISSUE:
Whether or not a second motion for reconsideration may be filed by P&G.
RULING:
NO. It is immaterial that the Entry of Judgment was made without the Court having first
resolved P&Gs second motion for reconsideration. This is because the issuance of the entry of
judgment is reckoned from the time the parties received a copy of the resolution denying the first
motion for reconsideration. The filing by P&G of several pleadings after receipt of the resolution
denying its first motion for reconsideration does not in any way bar the finality or entry of judgment.
Besides, to reckon the finality of a judgment from receipt of the denial of the second motion for
reconsideration would be absurd. First, the Rules of Court and the Internal Rules of the Supreme
Court prohibit the filing of a second motion for reconsideration. Second, some crafty litigants may
resort to filing prohibited pleadings just to delay entry of judgment.
To rule that finality of judgment shall be reckoned from the receipt of the resolution or order
denying the second motion for reconsideration would result to an absurd situation whereby courts
will be obliged to issue orders or resolutions denying what is a prohibited motion in the first place,
in order that the period for the finality of judgments shall run, thereby, prolonging the disposition of
cases. Moreover, such a ruling would allow a party to forestall the running of the period of finality of
judgments by virtue of filing a prohibited pleading; such a situation is not only illogical but also unjust
to the winning party.
AIRLINE PILOTS ASSOCIATION OF THE PHILIPPINES v. PHILIPPINE AIRLINES, INC.

G.R. No. 168382 , 6 June 2011, FIRST DIVISION (Del Castillo, J.)
Settled in law is that once a decision has acquired finality, it becomes immutable and
unalterable, thus can no longer be modified in any respect. Subject to certain recognized exceptions, the
principle of immutability leaves the judgment undisturbed as "nothing further can be done except to
execute it.”
The present controversy stemmed from a labor dispute between respondent Philippine
Airlines, Inc. (PAL) and Airline Pilots Association of the Philippines (ALPAP), the legitimate labor
organization and exclusive bargaining agent of all commercial pilots of PAL. Claiming that PAL
committed unfair labor practice, ALPAP filed on December 9, 1997, a notice of strike against
respondent PAL with the DOLE. Upon PAL’s petition and considering that its continued operation is
impressed with public interest, the DOLE Secretary assumed jurisdiction over the labor dispute.
ALPAP then filed with the Labor Arbiter a complaint for illegal lockout against PAL. On PAL’s
motion, the LA consolidated the petition. The LA then dismissed the complaint of lockout filed by
ALPAP. Meanwhile, several ALPAP members filed separate individual complaints for illegal dismissal
and non-payment of monetary benefits against PAL. The case reached up to the Supreme Court,
hence, all cases filed attained finality. ALPAP then filed before the Office of the DOLE a motion,
requesting the DOLE to conduct an appropriate proceeding to determine who among its officers and
members should be reinstated and deemed to have lost their employment. PAL on the other hand,
contends that the issue has been resolved by the Supreme Court already, hence, the case attained its
finality since the SC is the highest arbiter of the land. After careful consideration of the factual
antecedents, the Office concludes that the issue has been resolved with finality by the highest tribunal
of the land, the Supreme Court.
The case was raised to the Court of Appeals (CA) via petition for review. The CA dismissed
the petition. ALPAP filed a petition before the Supreme Court contending that the CA merely took
notice of the motions when the issues raised therein sprang from the DOLE Secretary’s exercise of
authority to assume jurisdiction over the a labor dispute which have remained unresolved.
ISSUE:
Whether or not the contention of ALPAP is tenable.
RULING:
NO. There was no grave abuse of discretion on the part of the CA in merely noting ALPAP’s
twin motions in due deference to a final and immutable judgment rendered by the Supreme Court.
From the June 1, 1999 DOLE Resolution, which declared the strike of June 5, 1998 as illegal and
pronounced all ALPAP officers and members who participated therein to have lost their employment
status, an appeal was taken by ALPAP. This was dismissed by the CA in CA-G.R. SP No. 54880, which
ruling was affirmed by this Court and which became final and executory on August 29, 2002.
In the instant case, ALPAP seeks for a conduct of a proceeding to determine who among its
members and officers actually participated in the illegal strike because, it insists, the June 1, 1999
DOLE Resolution did not make such determination. However, as correctly ruled by Sto. Tomas and
Imson and affirmed by the CA, such proceeding would entail a reopening of a final judgment which
could not be permitted by this Court. Settled in law is that once a decision has acquired finality, it
becomes immutable and unalterable, thus can no longer be modified in any respect. Subject to certain
recognized exceptions, the principle of immutability leaves the judgment undisturbed as "nothing
further can be done except to execute it."
True, the dispositive portion of the DOLE Resolution does not specifically enumerate the
names of those who actually participated in the strike but only mentions that those strikers who
failed to heed the return-to-work order are deemed to have lost their employment. This omission,
however, cannot prevent an effective execution of the decision. As was held in Reinsurance Company
of the Orient, Inc. v. Court of Appeals, any ambiguity may be clarified by reference primarily to the
body of the decision or supplementary to the pleadings previously filed in the case. In any case,
especially when there is an ambiguity, "a judgment shall be read in connection with the entire record
and construed accordingly." There is no necessity to conduct a proceeding to determine the
participants in the illegal strike or those who refused to heed the return to work order because the
ambiguity can be cured by reference to the body of the decision and the pleadings filed.
her Attorney-in-Fact MARINA T. ENTIERRO
Immutability of Judgement: A judgment which has acquired finality becomes immutable and
unalterable, hence, may no longer be modified in any respect except to correct clerical errors or
mistakes, all the issues between the parties being deemed resolved and laid to rest. Further, it can no
longer be disturbed or reopened no matter how erroneous it may be. Although judicial determinations
are not infallible, judicial error should be corrected through appeals, not through repeated suits on the
same claim.
Francisco Entierro (Francisco) died intestate and left behind a parcel of land (subject
property). Francisco’s spouse, Basilia Tabile (Basilia), and their legitimate children (Basilia, et al.),
executed a Deed of Sale with Declaration of Heirship. At the same time, sold the subject property to
spouses Selga. By reason of said sale, the title in Francisco’s name was cancelled and replaced under
Sps. Selga’s names.
Seven years later, Sony Entierro Brar, represented by her sister-in-law and attorney-in-fact,
Marina T. Entierro, filed before the RTC a Complaint for Annulment of Sale with Damages against Sps.
Selga. She claimed that she was one of the legitimate children of Francisco and Basilia, and that she
had been preterited. The Regional Trial Court (RTC) ruled in favour of Brar. It ruled that the property
relation of the heirs was governed by the provisions on co-ownership. Basilia, et al., validly sold all
their rights and interests over the subject property, excluding the rights and interests over the same
pertaining to Brar. The said decision eventually became final and executory.
In a Letter, Brar informed Sps. Selga that she was exercising her right to redeem her share in
the subject property. The latter’s counsel, however, rejected the demand. This prompted Brar to
institute a Complaint for Legal Redemption with Damages. In their Answer, Sps. Selga invoked the
res judicata and/or forum shopping. The RTC ruled in favour of the Sps. Selga. The CA reversed the
said ruling and held that Brar had validly exercised her right to redemption of the subject property
and was not barred by the final judgment and the judgment had already become final.Hence, the
instant petition.
ISSUE:
Whether or not the court in the second case can order that Brar has the right to redeem the
subject property despite the fact that the court in the first case already rendered a final and executory
decision which was silent on the topic.
RULING:
NO. In her Complaint in first case, Brar already alleged her right to redemption and prayed,
among others, that the RTCorder him to be legally entitled to redeem the subject property. However,
the Decision neither discussed the right to redemption nor ordered in its decretal portion for Sps.
Selga to accept Brar’s offer to redeem the subject property. The Court hold that the silence of the
Decision does not mean that RTC did not take cognizance of the same, but rather, that RTC did not
deem Brar entitled to said right.
Regardless of whether or not the RTC erred in not ordering the redemption, said judgment
can no longer be reviewed or corrected. Any such error could only be reviewed or corrected on
appeal. Although respondent initially filed an appeal of said judgment before the Court of Appeals,
she eventually filed a motion to withdraw the same, which was granted by the appellate court. Hence,
the Decision attained finality.
SPS EULOGIA & RAMON MANILA v. SPS EDERLINDA &DANIEL MANZO

G.R. No. 163602, 7 September 2011, FIRST DIVISION (VILLARAMA, JR., J.)
An action for annulment of judgment cannot and is not a substitute for the lost remedy of appeal.
The controversy stemmed from an action for ejectment filed by the Sps. Manzo, against the
Sps. Manila, before the Metropolitan Trial Court (MeTC) of Las Pinas City which ruled in favor of the
Sps. Manzo.
On appeal, the Regional Trial Court (RTC) reversed and set aside the MeTC decision. Sps. Manzo
filed a motion for reconsideration which the RTC denied for having been filed beyond the fifteen (15)-
day period. Consequently, the actual decision became final and executory.
Thereafter, Sps. Manzo filed a petition for annulment of the RTC decision in the Court of Appeals (CA).
By Decision, the CA granted the petition, annulled the RTC decision and reinstated the MeTC decision.
With the denial of their motion for reconsideration, Sps, Manila filed the present petition.
ISSUE:
Whether or not the remedy of annulment of judgment is available where the ordinary
remedies of new trial, appeal, petition for relief, among others, were lost through the fault of Sps.
Manzo.
RULING:
NO. A petition for annulment of judgments or final orders of the RTX in civil actions can only
be availed of where the ordinary remedies of new trial, appeal, petition for relief or other appropriate
remedies are no longer available through no fault of the petitioner. It is a remedy granted only under
exceptional circumstances and such action is never resorted to as a substitute for a party’s own
neglect in not promptly availing of the ordinary or other appropriate remedies. The only grounds
provided in Sec. 2, Rule 47 are extrinsic fraud and lack of jurisdiction.
In this case, Sps. Manzo alleged that the loss of remedies against the RTC decision was
attributable to their former counsel’s late filing of their motion for reconsideration and failure to file
any proper petition to set aside the said decision. The Court is not persuaded. As party litigants, they
should have constantly monitored the progress of their case. Such negligence of counsel is binding
on the client, especially when the latter offered no plausible explanation for his own inaction. This is
true especially where he does not complain against the manner his counsel handles the suit.
THE LAW FIRM OF RAYMUNDO A. ARMOVIT v. COURT OF APPEALS and BENGSON

COMMERCIAL BUILDING, INC.
G.R. No. 154559, 5 October 2011, FIRST DIVISION, (Leonardo-De Castro, J.)
When there is a conflict between the dispositive portion or fallo of a decision and the opinion of
the court contained in the text or body of the judgment, the former prevails over the latter.
Bengson Commercial Building, Inc. (BCBI) obtained loans from the GSIS secured by real estate
and chattel mortgages. When BCBI defaulted in the payment of the amortizations, GSIS extrajudicially
foreclosed the mortgaged properties and sold them at public auction where it emerged as the highest
bidder. With the Armovit Law Firm as its counsel, BCBI filed an action to annul the extrajudicial
foreclosure which was granted by the RTC, which was also affirmed by the CA with modifications.
Such judgment became final and executory, which under the fallo provides that 20% contingent fee
computed on the value to be recovered by favorable judgment in the cases and many others has been
agreed as compensation.
Neither party filed a Motion for Reconsideration from the decision of the Court. Thus, the
Decision became final and executory. However, Armovit Law Firm filed an Omnibus motion praying,
among other things, that a final assessment of its attorney’s fees be computed at 20% on the value of
all the properties recovered by the BCBI, deducting the amount already paid which is 20% of the
money judgment for P 1.9 M; and that a write of execution for the full payment of the balance of its
attorney’s fees be issued.
ISSUE:
Whether or not the Appellate and Trial courts erred in defying the SC in its final and executory
decision awarding petitioner a contingent fee of twenty percent of all recoveries.
HELD:
NO. The petition is devoid of merit. It is basic that when there is a conflict between the
dispositive portion or fallo of a decision and the opinion of the court contained in the text or body of
the judgment, the former prevails over the latter. An order of execution is based on the disposition,
not on the body of the decision. This rule rests on the theory that the fallo is the final order while the
opinion in the body is merely a statement ordering nothing.
The confusion created in the case at bar shows yet another reason why mere
pronouncements in bodies of Decisions may not be the subject of execution: random statements can
easily be taken out of context and are susceptible to different interpretations. When not enshrined in
a clear and definite order, random statements in bodies of Decisions can still be the subject of another
legal debate, which is inappropriate and should not be allowed in the execution stage of litigation.
Consequently, the trial court cannot be considered to have committed grave abuse of
discretion in denying the execution of the statement in the body of the Court’s1991 Decision that "we
do not find Atty. Armovit’s claim for ‘twenty percent of all recoveries’ to be unreasonable." All things
considered, it was the interpretation of Armovit Law Firm, not that of the trial court, which had the
effect of varying the final and executory Decision of the Court in G.R. No. 90983. The instant Petition
for Certiorari should therefore fail.
COL. FRANCISCO DELA MERCED, substituted by his heirs namely, LUIS CESAR DELA MERCED,
et. al v. GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) and Spouses VICTOR and
MILAGROS MANLONGAT
A transferee pendent lite of registered land, whose title bears a notice of a pending litigation
involving his transferor’s title to the said land, is bound by the outcome of the litigation, whether it be
for or against his transferor. Given this principle, the modification of the final decision against the
transferor in order to include the transferee pendent lite does not violate the doctrine of immutability
of final judgments. His inclusion does not add to or change the judgment; it is only a legal consequence
of the established doctrine that a final judgment binds the privy of a litigating party.
This case stemmed from a case (G.R. No. 140398) that has been already finally decided by the
Court in Dela Merced, et. al’s favour. The Court remanded the case to the lower court for execution.
GSIS opposed the motion for execution, citing as basis Section 39 of Republic Act No. 8291 (RA 8291),
also known as the GSIS Act of 1997. The said provision allegedly exempts GSIS funds and properties
from attachment, garnishment, execution, levy and other court processes. Although both titles
contained notices of lis pendens carried over from GSISs title, the RD claimed that the writ of
execution must first be modified to include the cancellation of derivative titles of the GSIS title.
Before the Court is a Petition for Review assailing the validity of the Order of Branch 160 of
the Regional Trial Court (RTC) of Pasig City. GSIS argues that petitioner’s motion was properly
denied because it seeks to modify a final and executory Decision. The Decision in G.R. No. 140398
only ordered the cancellation of GSISs titles over the subject properties. It did not order the
cancellation of all derivative titles of GSIS’s transferees; nor did it order the GSIS to perform acts such
as providing the RD with the technical descriptions.Further, GSIS opines that the holders of the
derivative titles are not bound by the judgment against GSIS because these holders are strangers to
the action between GSIS and petitioners.
Dela Merced, et. al counter, as regards GSIS’s alleged exemption, is that the GSIS can no longer
raise the issue of exemption from execution given that the Court had already rendered its Decision
on that question. They further posit that the Decision in G.R. No. 140398 can be enforced against
GSIS’s transferees pendent lite because these transferees were given notice of the pendency of the
case by virtue of the notice of lis pendens that had been inscribed on GSIS’s title. With regard to the
issuance of new titles for Lot 10, Block 2 and Lot 8, Block 8, petitioners argue that GSIS can be
compelled to provide the RD with their respective technical descriptions. This power is granted to
the courts under Section 10, Rule 39 of the Rules of Court..
ISSUE:
Whether or not a final and executory judgment against GSIS can be enforced against their
successors-in-interest or holders of derivative titles.
RULING:
YES. A notice of lis pendens is an announcement to the whole world that a particular real
property is in litigation, serving as a warning that one who acquires an interest over said property
does so at his own risk, or that he gambles on the result of the litigation over the said property. Once
a notice of lis pendens has been duly registered, any cancellation or issuance of the title of the land
involved as well as any subsequent transaction affecting the same, would have to be subject to the
outcome of the litigation. In other words, upon the termination of the litigation there can be no risk
of losing the property or any part thereof as a result of any conveyance of the land or any
encumbrance that may be made thereon posterior to the filing of the notice of lis pendens.
The filing of a notice of lis pendens has a twofold effect: (1) to keep the subject matter of the
litigation within the power of the court until the entry of the final judgment to prevent the defeat of
the final judgment by successive alienations; and (2) to bind a purchaser, bona fide or not, of the land
subject of the litigation to the judgment or decree that the court will promulgate subsequently.
NILO PADRE v. FRUCTOSA BADILLO, et al.

A void judgment is no judgment at all. It cannot be the source of any right nor the creator of any
obligation. All acts performed pursuant to it and all claims emanating from it have no legal effect.
The Regional Trial Court (RTC) rendered judgment in a civil case (Civil Case No. A-514) for
Ownership and Recovery of Possession with Damages in favor of Fructosa Badillo, et. al and against
therein defendants, including Consesa Padre. This Decision became final and executor. The Badillo
family filed another complaint against those who occupy their property which included some of the
defendants in the aforesaid civil case. The case was filed with the MTC and was docketed as Civil Case
No. 104. Interpreting the suit of the Badillo family as an action to revive the dormant judgment in the
previous civil case, the court recognized the right of the Badillo family to finally have such judgment
enforced. The Motion for Reconsideration was denied. By way of a special civil action for certiorari,
Nilo Padre elevated the case to the RTC to question the MTCs jurisdiction but RTC dismissed said
petition on the ground that it was filed late. Moreover, the RTC upheld the MTCs jurisdiction over the
case, affirming the MTCs ratiocination that an action for enforcement of a dormant judgment is a
personal action, and hence may be filed either at the court of the place where plaintiffs reside or
where the defendants reside. Motion for Reconsideration was denied.
ISSUE:
Whether or not MTC validly acquired jurisdiction over the case.
RULING:
NO. What determines the nature of the action and which court has jurisdiction over it are the
allegations in the complaint and the character of the relief sought. In their complaint in Civil Case No.
104, some of the allegations of the Badillo family, which petitioner never opposed and are thus
deemed admitted by him, states that under paragraph 6 of their complaint, the Badillos alleged that
judgment in Civil Case No. A-514 had become final and had been executed. Further, in paragraph 7,
they alleged that in 1990, the defendants re-entered the property and despite repeated demands they
refused to vacate the same. Thus, the Badillos were not at all seeking a revival of the judgment. In
reality, they were asking the MTC to legally oust the occupants from their lots.
Whether the case filed by the Badillo family is a real or a personal action is irrelevant.
Determining whether an action is real or personal is for the purpose only of determining venue. In
the case at bar, the question raised concerns jurisdiction, not venue.
Although the Badillo family correctly filed a case for accion publiciana, they pleaded their case
before the wrong court. In civil cases involving realty or interest therein not within Metro Manila, the
MTC has exclusive original jurisdiction only if the assessed value of the subject property or interest
therein does not exceed P20,000.00. As the assessed value of the property subject matter of this case
is P26,940.00, and since more than one year had expired after the dispossession, jurisdiction
properly belongs to the RTC. Hence, the MTC has no judicial authority at all to try the case in the first
place. A decision of the court without jurisdiction is null and void; hence, it could never logically
become final and executory. Such a judgment may be attacked directly or collaterally.
REPUBLIC OF THE PHILIPPINES v. SPOUSES FLORENCIO DE CASTRO and ROMELIA CALIBOSO

DE CASTRO
G.R. No. 189724, 7 February 2011, THIRD DIVISION, (Carpio Morales, J.)
A petition for annulment of judgment under Rule 47 is a remedy granted only under exceptional
circumstances where a party, without fault on his part, has failed to avail of the ordinary or other
appropriate remedies provided by law. Such action is never resorted to as a substitute for a party’s own
neglect in not promptly availing of the ordinary or other appropriate remedies.
The Director of the Bureau of Lands issued Free Patent in the name of Marcelino Manipon
(Manipon). An investigation conducted by the representatives of LMB, Manila on the issuance of Free
Patent showed that the lot is not an alienable and disposable land of the public domain since it is
within the established reservation for the exclusive use of non-Christian tribes, now known as
the Paitan Mangyan Reservation. Consequently, the Republic of the Philippines, through the Office of
the Solicitor General, filed a Complaint for Cancellation of TCT and Reversion against Manipon.
Notably, Manipon had, at the time of the filing of the complaint, been dead for ten years.
The trial court rendered a Decision nullifying Manipon’s Free Patent and ordering the
reversion of the lot to the State. No motion for reconsideration of the trial court’s decision, or appeal
therefrom was filed, hence, the decision became final and executory. On Republic’s motion, the trial
court, by Order of April 29, 2004, issued a writ of execution on August 2, 2005.The writ was served
on Manipon on March 29, 2005 and implemented on July 20, 2006.
On March 15, 2007, Manipon’s filed a petition for annulment of judgment of the trial court’s
decision of October 9, 2002 before the Court of Appeals on grounds that it did not acquire jurisdiction
over the person of Manipon as he had been dead when the complaint was filed. Manipon maintain
that they did not receive a copy of the trial court’s decision and that they came to know of it only
when the trial courts sheriff personally served upon them a copy of the writ of execution of the
decision.
ISSUE:
Whether or not the petition for annulment of judgement is proper.

RULING:
NO. Before a party can avail of the reliefs provided for by Rule 47, i.e., annulment of
judgments, final orders, and resolutions, it is a condition sine qua non that one must have failed
to move for new trial in, or appeal from, or file a petition for relief against said issuances or take other
appropriate remedies thereon, through no fault attributable to him. If he failed to avail of those cited
remedies without sufficient justification, he cannot resort to the action for annulment provided in
Rule 47, for otherwise he would benefit from his own inaction or negligence
In the instant case, not only did Manipons fail to avail of the ordinary and appropriate
remedies in assailing the questioned judgments of the trial court, but he also failed to show to the
satisfaction of this Court that he could not have availed of the ordinary and appropriate remedies
under the Rules. Upon notice of the writ of execution on, by Manipons own information, Manipons if
indeed they were completely unaware of the trial court’s decision had available remedies to question
it. They could have promptly filed a motion to quash the writ of execution or, in the alternative,
a petition for relief from judgment under Rule 38 of the 1987 Rules of Civil Procedure. That they had
ample opportunity to do so is gathered from the fact that the writ of execution of the decision was
not immediately implemented by the sheriff as it was satisfied only on July 20, 2006. Having failed to
avail of any of the aforesaid remedies without any justification, Manipons are barred from resorting
to the action for annulment of judgment under Rule 47; otherwise, they would benefit from their own
inaction or negligence.
DANILO L. PAREL v. HEIRS OF SIMEON PRUDENCIO

G.R. No. 192217, March 2, 2011, FIRST DIVISION (Velasco, J.)
As a general rule, once a judgment becomes final and executory, all the issues between the
parties are deemed resolved and laid to rest. All that remains is the execution of the decision which is a
matter of right. However, one of the instances where a writ of execution may be appealed is when there
has been a change in the situation of the parties making the execution inequitable or unjust and in order
to serve substantial justice.
Simeon Prudencio (Simeon) filed a complaint for recovery of possession and damages against
Danilo Parel (Parel), alleging that he was the owner of a two-story house. Simeon allowed Parel and
his parents to live on the ground floor of the house since his wife was the elder sister of Parel’s father.
Simeon needed the whole house back and thus informed Parel and his parents that they had to vacate
the place. Parel’s parents acceded to Simeon’s demand. Parel, however, remained in the house with
his family despite repeated demands on him to surrender the premises. Parel countered that the land
on which Simeon’s house was constructed was in his father’s name. His father did not have enough
funds to build a house and thus made a deal with Simeon for them to just contribute money for the
construction of the house. Parel’s father and Simeon were, thus, co-owners of the house of which
Simeon claims sole ownership.
The Regional Trial Court (RTC) ruled in favor of Parel, but the same was reversed by the Court
of Appeals (CA). The Supreme Court affirmed the CA’s decision and the same became final and
executory. Simeon then filed a motion for issuance of writ of execution. In his comment, Parel prayed
that the monthly rental he was ordered to pay be recomputed. The RTC issued a writ of execution.
However, Parel filed a motion for reconsideration on the said issuance but the same was denied. Parel
then filed a Supplemental Petition with Urgent Motion for Issuance of Temporary Restraining Order
and/or Writ of Preliminary Injunction to enjoin the RTC from enforcing the judgment against him.
ISSUE:
Whether or not the writ of execution may be appealed.
RULING:
YES. As a general rule, once a judgment becomes final and executory, all the issues between
the parties are deemed resolved and laid to rest. All that remains is the execution of the decision
which is a matter of right. However, one of the instances where a writ of execution may be appealed
is when there has been a change in the situation of the parties making the execution inequitable or
unjust. This case falls under such exception. The fact that Parel has left the property under dispute is
a change in the situation of the parties that would make execution inequitable or unjust.
Moreover, there are exceptions that have been previously considered by the Court as
meriting a relaxation of the rules in order to serve substantial justice. These are: (1) matters of life,
liberty, honor or property; (2) the existence of special or compelling circumstances; (3) the merits of
the case; (4) a cause not entirely attributable to the fault or negligence of the party favored by the
suspension of the rules; (5) a lack of any showing that the review sought is merely frivolous and
dilatory; and (6) the other party will not be unjustly prejudiced thereby. Parel’s situation merits a
relaxation of the rules since special circumstances are involved; to determine if his allegation were
true would allow a final resolution of the case.
ANICETO CALUBAQUIB, et al. v. REPUBLIC OF THE PHILIPPINES

Due process rights are violated by a motuproprio rendition of a summary judgment.
President Manuel L. Quezon issued Proclamation No. 80, which declared a 39.3996-hectare
landholding in Tuguegarao, Cagayan, a military reservation site. The proclamation expressly stated
that it was being issued "subject to private rights, if any there be."
On January 16, 1995, the Republic filed before the RTC of Tuguegarao, Cagayan a complaint
for recovery of possession against Aniceto Calubaquib et al. alleging that sometime in 1992,
Calubaquib et al. unlawfully entered the military reservation through strategy and stealth and took
possession of a five-hectare portion thereof. Calubaquib et al. filed an answer denying the allegation
that they entered the subject property through stealth and strategy sometime in 1992.
Given the trial court's opinion that the basic facts of the case were undisputed, it advised the
parties to file a motion for summary judgment. Notably, neither party filed the motion. In fact, the
Republic expressed on two occasions its objection to a summary judgment. It explained that
summary judgment is improper given the existence of a genuine and vital factual issue, which is
Calubaquib et al.'s claim of ownership over the subject property. It argued that the said issue can
only be resolved by trying the case on the merits. Notwithstanding, the absence of motion, the Trial
court rendered a summary judgment which was subsequently affirmed by the CA.
ISSUE:
Whether or not the rendition of summary judgement is proper.

RULING:
NO. Summary judgments are proper when, upon motion of the plaintiff or the defendant, the
court finds that the answer filed by the defendant does not tender a genuine issue as to any material
fact and that one party is entitled to a judgment as a matter of law.
The filing of a motion and the conduct of a hearing on the motion are important because these
enable the court to determine if the parties' pleadings, affidavits and exhibits in support of, or against,
the motion are sufficient to overcome the opposing papers and adequately justify the finding that, as
a matter of law, the claim is clearly meritorious or there is no defense to the action. The non-
observance of the procedural requirements of filing a motion and conducting a hearing on the said
motion warrants the setting aside of the summary judgment.
In the case at bar, the trial court proceeded to render summary judgment with neither of the
parties filing a motion therefor. In fact, the Republic itself filed an opposition when the trial court
directed it to file the motion for summary judgment. The Republic insisted that the case involved a
genuine issue of fact. Under these circumstances, it was improper for the trial court to have persisted
in rendering summary judgment. Considering that the remedy of summary judgment is in derogation
of a party's right to a plenary trial of his case, the trial court cannot railroad the parties' rights over
their objections.
MAXIMINA A. BULAWAN v. EMERSON B. AQUENDE

G.R. No. 182819, 22 June 2011, SECOND DIVISION, (Carpio, J.)
It will be the height of inequity to allow Aquende’s title to be nullified without being given the
opportunity to present any evidence in support of his ostensible ownership of the property. Much more,
it is tantamount to a violation of the constitutional guarantee that no person shall be deprived of
property without due process of law.
Maximina Bulawan (Bulawan) filed a complaint for annulment of title, reconveyance and
damages against Lourdes Yap. The subject property herein was occupied by Emerson B. Aquende
(Aquende) with title under his name. Aquende did not receive any notice nor summons regarding the
complaint by Bulawan against Yap which affected his property. Nonetheless, the trial court and as
affirmed by the CA ruled in favor of Bulawan. The decision became final and executory wherein writ
of execution was issued.
In a letter the Register of Deeds informed Aquende of the trial courts writ of execution and
required Aquende to produce the TCT so that a memorandum of the lien may be annotated on the
title. Aquende wrote a letter to the Register of Deeds questioning the trial courts writ of execution
against his property. Aquende alleged that he was unaware of any litigation involving his property
having received no summons or notice thereof, nor was he aware of any adverse claim as no notice
of lis pendens was inscribed on the title.The trial court denied Aquende’s Notice of Appearance with
Third Party Motion and prayer for partial annulment of the trial court’s Decision.
Consequently, Aquende filed a petition for annulment of judgment before the Court of Appeals on the
grounds of extrinsic fraud and lack of jurisdiction. The CA granted the petition. Thus, Bulawan
questions the propriety of the grant of annulment of judgement.
ISSUE:
Whether or not the petition for annulment of judgement is proper.
RULING:
YES. In a petition for annulment of judgment, the judgment may be annulled on the grounds
of extrinsic fraud and lack of jurisdiction. Fraud is extrinsic where it prevents a party from having a
trial or from presenting his entire case to the court, or where it operates upon matters pertaining not
to the judgment itself but to the manner in which it is procured. The overriding consideration when
extrinsic fraud is alleged is that the fraudulent scheme of the prevailing litigant prevented a party
from having his day in court.On the other hand, lack of jurisdiction refers to either lack of jurisdiction
over the person of the defending party or over the subject matter of the claim, and in either case the
judgment or final order and resolution are void. Where the questioned judgment is annulled, either
on the ground of extrinsic fraud or lack of jurisdiction, the same shall be set aside and considered
void.
In his petition for annulment of judgment, Aquende alleged that there was extrinsic fraud
because he was prevented from protecting his title when Bulawan and the trial court failed
to implead him as a party.Aquende also maintained that the trial court did not acquire jurisdiction
over his person and, its Decision is not binding on him. In its Decision, the Court of Appeals found
merit in Aquende’s petition and declared that the trial court did not acquire jurisdiction
over Aquende. Moreover, annulment of judgment is a remedy in law independent of the case where
the judgment sought to be annulled was rendered. Consequently, an action for annulment of
judgment may be availed of even if the judgment to be annulled had already been fully executed or
implemented.
SPOUSES JUANITO MAHUSAY AND FRANCISCA MAHUSAY v. B.E. SAN DIEGO, INC.
G.R. NO. 179675, 1 June 2011, SECOND DIVISION, (Nachura, J.)
It is a settled rule is that a judgment which has acquired finality becomes immutable and
unalterable; hence, it may no longer be modified in any respect except only to correct clerical errors or
mistakes.
Spouses Juanito and Francisca Mahusay (Spouses Mahusay) purchased several lots owned by
B.E. San Diego, Inc. payable in monthly installments. Due to spouses Mahusay’s nonpayment of the
monthly amortizations since October 1978, B.E. San Diego was constrained to file a case. After some
time the Decision in favor of B.E. San Diego became final and executory, and entry of judgment was
made in due course on January 19, 2002. Thereafter, in the execution of the decision, the parties
disagreed, particularly in the computation of the amount to be paid by spouses Mahusay.
On May 6, 2004, B.E. San Diego filed a Motion for Clarification of the decision. It prayed for
the inclusion of the penalties and interest in the computation of unpaid amortizations, which it
claimed is customary in real estate business and compliant with the Contracts to Sell, for the proper
execution and implementation of the CA Decision. Spouses Mahusay opposed the motion contending
that a simple reading of the Motion for Clarification would show that it was not intended to clarify
but to amend the decision. They argued that the inclusion of 12% interest per annum is a very serious
and material amendment, because under the original Decision, spouses Mahusay would be required
to pay only P352,992.00, which is the amount of the unpaid amortizations for the said lots; while in
the Amended Decision, they would be liable for P5,175,688.59, per computation made by B.E. San
Diego.
ISSUE:
Whether or not the motion for clarification amounts to alteration of final judgement.
RULING:
NO. Clarification after final judgment is, however, allowed when what is involved is a clerical
error, or not a correction of an erroneous judgment, or dispositive portion of the Decision. Where
there is an ambiguity caused by an omission or mistake in the dispositive portion, the court may
clarify such ambiguity, mistake, or omission by an amendment; and in so doing, it may resort to the
pleadings filed by the parties, the court’s finding of facts and conclusions of law as expressed in the
body of the decision.
In the case at bar, there is no dispute that, in 1973 spouses Mahusay entered into two
Contracts to Sell with B.E. San Diego, respectively for the purchase of several lots. Spouses
Mahusay’sobligation to pay the purchase price for the lots was never denied. Accordingly, the
contractual stipulation that spouses Mahusay shall pay the monthly amortizations is binding and
enforceable. It is the law between the parties. Spouses Mahusay stopped paying the amortizations in
October 1978, leaving a total unpaid balance of P352, 992.00 as of January 30, 1979. As it turned out,
the final decision held spouses Mahusay liable for the payment of all the unpaid amortizations,
including amortizations yet to be paid, until the expiration of the contract. Apparently, the decision
was silent on the payment of the interest/penalty for the delay in payments, which led to the Motion
for Clarification filed by B.E. San Diego.
Based on the foregoing facts and circumstances, the Court finds no reversible error in
clarifying the original Decision. B.E. San Diego’s Motion for Clarification did not really partake of the
nature of a motion for reconsideration, as to amend the final Decision. There was nothing substantial
to vary, considering that the issues between the parties were deemed resolved and laid to rest. It is
unmistakably clear that spouses Mahusay do not deny the execution of the Contracts to Sell and, in
fact, admit their liability for the unpaid amortizations of the lots purchased. The persistent violations
of the contracts and the continuous delay in spouses Mahusay’s payments cannot simply be
overlooked. There was a compelling reason for the clarification of the original Decision to include the
payment of all penalties and interest due on the unpaid amortizations, as provided in the contracts.
Considering that the validity of the contracts was never put in question, and there is nothing on
record to suggest that the same may be contrary to law, morals, public order, or public policy, there
is nothing unlawful in the stipulation requiring the payment of interest/penalty at the rate agreed
upon in the contract of the parties.
MANUEL YBIERNAS et al. v. ESTER TANCO-GABALDON, et al.

A summary judgement is a final judgement which can be subject of a motion for new trial.
A summary judgement in favor of Manuel Ybiernas et al. were issued by the Regonal Trial
Court (RTC) as to the ownership of the land subject of the case. Consequently, Ester Tanco-Gabaldon
et al. filed an appeal before the CA and filed a motion for new trial based on newly discovered
evidence as to the ownership of the land. In opposition, Ybiernas et al. argued that the questioned
decision was a partial summary judgment which could not be the subject of a motion for new trial.
ISSUE:
Whether or not the summary judgement is a final judgement which can be the subject of a
motion for new trial.
RULING:
YES. A final judgment or order is one that finally disposes of a case, leaving nothing more for
the court to do in respect thereto, such as an adjudication on the merits which, on the basis of the
evidence presented at the trial, declares categorically what the rights and obligations of the parties
are and which party is in the right, or a judgment or order that dismisses an action on the ground
of res judicata or prescription, for instance. Just like any other judgment, a summary judgment that
satisfies the requirements of a final judgment will be considered as such.
A summary judgment is granted to settle expeditiously a case if, on motion of either party,
there appears from the pleadings, depositions, admissions, and affidavits that no important issues of
fact are involved, except the amount of damages. The RTC judgment in this case fully determined the
rights and obligations of the parties relative to the case for quieting of title and left no other issue
unresolved, except the amount of damages. Hence, it is a final judgment.
In leaving out the determination of the amount of damages, the RTC did not remove its
summary judgment from the category of final judgments. In fact, under Section 3,Rule 35 of the Rules
of Court, a summary judgment may not be rendered on the amount of damages, although such
judgment may be rendered on the issue of the right to damages.
EUGENIO BASBAS, et. al v. BEATA SAYSON and ROBERTO SAYSON, JR.

G.R. No. 172660, 24 August 2011, FIRST DIVISION, (DEL CASTILLO, J)
When the Answer specifically denies the material averments of the complaint or asserts
affirmative defenses, or in other words raises an issue, a summary judgment is proper provided that the
issue raised is not genuine.
Beata Sayson and her husband Roberto Sayson, Sr. filed a Petition for Registration of an
agricultural land located in Leyte. . The said application was opposed by the Republic of the
Philippines and Eugenio Basbas, Sr., Teofilo Aras and Rufino Aras. The Court of First Instance (CFI)
rendered a Decision adjudicating to the spouses Sayson said agricultural land and approving its
registration under their names. On appeal, the Court of Appeals (CA) affirmed in toto the decision of
the CFI.
An Alias Writ of Possession was issued on April 6, 1989 but this could also not be
implemented in view of the refusal of Eugenio Sr. and his son Eugenio Basbas, Jr. An Alias Writ of
Possession was issued on April 6, 1989 but this could also not be implemented in view of the refusal
of Eugenio Sr. and his son Eugenio Basbas, Jr. The RTC approved the on the relocation survey and
Eugenio Sr., Teofilo and Rufino, as well as Gervacio Basbas, et. al to vacate the subject property.
Beata and Roberto filed an Omnibus Motion for Judgment on the Pleadings and/or Summary
Judgment. They contended that since petitioners’ Answer failed to tender an issue, they having
expressly admitted the material allegations in the complaint, a judgment on the pleadings or
summary judgment is proper.In resolving respondents Omnibus Motion for Judgment on the
Pleadings and/or Summary Judgment, the RTC found that petitioners’ Answer does not essentially
tender an issue since the material allegations of the Complaint were admitted. On appeal, the Court
of Appeals affirmed the decision of the RTC.
ISSUE:
Whether or not the case is proper case for summary judgment.
RULING:
YES. What distinguishes a judgment on the pleadings from a summary judgment is the
presence of issues in the Answer to the Complaint. When the Answer fails to tender any issue, that is,
if it does not deny the material allegations in the complaint or admits said material allegations of the
adverse partys pleadings by admitting the truthfulness thereof and/or omitting to deal with them at
all, a judgment on the pleadings is appropriate.On the other hand, when the Answer specifically
denies the material averments of the complaint or asserts affirmative defenses, or in other words
raises an issue, a summary judgment is proper provided that the issue raised is not genuine. A
genuine issue means an issue of fact which calls for the presentation of evidence, as distinguished
from an issue which is fictitious or contrived or which does not constitute a genuine issue for trial.
To resolve the issues of whether a revival of judgment is the proper action and whether
respondents are the proper parties thereto, the RTC merely needed to examine the following: 1) the
RTC Order dated September 13, 1989, to determine whether same is a judgment or final order
contemplated under Section 6, Rule 39 of the Rules of Court; and, 2) the pleadings of the parties and
pertinent portions of the records showing, among others, who among the respondents were
oppositors to the land registration case, the heirs of such oppositors and the present occupants of the
property. Plainly, these issues could be readily resolved based on the facts established by the
pleadings. A full-blown trial on these issues will only entail waste of time and resources as they are
clearly not genuine issues requiring presentation of evidence.
Petitioners aver that the RTC should not have granted respondents Motion for Judgment on
the Pleadings and/or Summary Judgment because of the controverted stipulations and the first three
issues enumerated in the Pre-trial Order, which, according to them, require the presentation of
evidence. These stipulations and issues, however, when examined, basically boil down to questions
relating to the propriety of the action resorted to by respondents, which is revival of judgment, and
to the proper parties thereto the same questions which we have earlier declared as not constituting
genuine issues.
PILIPINO TELEPHONE CORPORATION v. RADIOMARINE NETWORK (SMARTNET)

PHILIPPINES, INC.
GR No. 160322, 24 August 2011, THIRD DIVISION, (Abad, J)
When the facts as pleaded appear uncontested or undisputed, then there is no real or genuine
issue. Summary judgment is proper in such a case.
Pilipino Telephone Corporation expressed its willingness to buy in 1997 from Radiomarine
Network, Inc. 300,000 units of various brands of cellular phones and accessories. Piltel agreed to sell
to Smartnet a 3,500-square meter lot. Smartnet agreed to pay Piltel P180 million as down payment
with the balance of P380 million to be partly set off against the obligations that Piltel was to incur
from its projected purchase of cellular phones and accessories from Smartnet.
Smartnet failed to pay the P380 million balance of the purchase price on or about the date it
fell due. On December 19, 1997 Piltel returned P50 million to Smartnet, a portion of the P180 million
down payment that it received. Smartnet later requested Piltel for the return of the remaining P130
million but the latter failed to do so. Smartnet filed a complaint for rescission of their contract to sell
or its partial specific performance before the Regional Trial Court. Smartnet filed a motion for partial
summary judgment for the return of the down payment it paid Piltel which the RTC granted. Piltel
filed with the Court of Appeals a special civil action for certiorari with application for a temporary
restraining order and a writ of preliminary injunction. But the CA dismissed the petition, prompting
Piltel to challenge such dismissal.
ISSUE:
Whether or not there are genuine issues of fact to be tried in this case.
RULING:
NO. A genuine issue of fact is that which requires the presentation of evidence, as
distinguished from a sham, fictitious, contrived or false issue. When the facts as pleaded appear
uncontested or undisputed, then there is no real or genuine issue. Summary judgment is proper in
such a case. Both Piltel and Smartnet admit that they entered into a contract to sell covering a land
owned by Piltel; that Smartnet agreed to pay Piltel P560 million for it, with a down payment of P180
million; and that Smartnet failed to pay the balance of the purchase price on or about April 30,
1997.With these common admissions, it is clear that there are no genuine issues of fact as to the
existence and nature of the contract to sell as well as Smartnet’s failure to pay the balance of the
purchase price within the agreed period. Thus, the RTC was correct in skipping trial and deciding the
case through a summary judgment based on the undisputed facts.
Motion for Reconsideration
ELLERY MARCH G. TORRES v. PAGCOR, represented by ATTY. CARLOS R. BAUTISTA, JR.,

G.R. No. 193531, 4 December 2011, EN BANC (Peralta, J.)
The use of a facsimile transmission in filing a motion for reconsideration is not sanctioned by
the Uniform Rules on Administrative Cases in the Civil Service. As we stated earlier, the motion for
reconsideration may be filed only in two ways, either by mail or personal delivery.
Ellery March Torres was a Slot Machine Operations Supervisor (SMOS) of Philippine
Amusement and Gaming Corporation (PAGCOR). On the basis of an alleged intelligence report of
padding of the Credit Meter Readings (CMR) of the slot machines at PAGCOR-Hyatt Manila which
involved the slot machine and internal security personnel of, and in connivance with slot machine
customers, PAGCOR's Corporate Investigation Unit (CIU) allegedly conducted an investigation to
verify the veracity of such report. The CIU discovered the fraudulent scheme of CMR padding. The
CIU identified the members of the syndicate who were responsible for such CMR padding, which
included Torres. Thereafter, the CIU served Torres with a Memorandum of Charges for dishonesty,
serious misconduct, fraud and violation of office rules and regulations which were considered grave
offenses where the penalty imposable is dismissal. Later, Torres received a letter from the Managing
Head of PAGCOR's Human Resource and Development Department, dismissing him from the service.
Torres then filed with the CSC a Complaint against PAGCOR and its Chairman for illegal
dismissal, non-payment of backwages and other benefits. PAGCOR filed its Comment wherein it
alleged, among others, that petitioner failed to perfect an appeal within the period and manner
provided by the Uniform Rules on Administrative Cases in the Civil Service Law.
The CSC, treating Torres’ complaint as an appeal from the PAGCOR's decision dismissing
petitioner from the service, issued a Resolution denying Torres’ appeal. In so ruling, the CSC found
that the issue for resolution was whether Torres’ appeal had already prescribed which the former
answered in the positive. Torres’ motion for reconsideration was denied. The Court of Appeals (CA)
affirmed. In dismissing the petition, the CA concluded that PAGCOR's decision dismissing Torres
from the service had already attained finality since there was no motion for reconsideration filed by
latter in the manner and within the period provided for under the Revised Uniform Rules on the
Administrative Cases in the Civil Service.
ISSUE:
Whether or not the CA erred when it affirmed the CSC's dismissal of the appeal for being filed
beyond the reglementary period.
RULING:
YES. Sections 37, 38, 39, and 43 of the Revised Uniform Rules on Administrative Cases in the
Civil Service are applicable to this case. Clearly, a motion for reconsideration may either be filed by
mail or personal delivery. When a motion for reconsideration was sent by mail, the same shall be
deemed filed on the date shown by the postmark on the envelope which shall be attached to the
records of the case. On the other hand, in case of personal delivery, the motion is deemed filed on the
date stamped thereon by the proper office. And the movant has 15 days from receipt of the decision
within which to file a motion for reconsideration or an appeal therefrom.
Torres received a copy of the letter/notice of dismissal on August 4, 2007; thus, the motion
for reconsideration should have been submitted either by mail or by personal delivery on or before
August 19, 2007. However, records do not show that Torres’ had filed his motion for
reconsideration. In fact, the CSC found that the non-receipt of petitioner's letter reconsideration was
duly supported by certifications issued by PAGCOR employees.
Even assuming arguendo that Torres indeed submitted a letter reconsideration which he
claims was sent through a facsimile transmission, such letter reconsideration did not toll the period
to appeal. The mode used by Torres in filing his reconsideration is not sanctioned by the Uniform
Rules on Administrative Cases in the Civil Service. As we stated earlier, the motion for
reconsideration may be filed only in two ways, either by mail or personal delivery. The filing of
pleadings through fax machines is inadmissible as evidence. A facsimile is not a genuine and authentic
pleading. It is, at best, an exact copy preserving all the marks of an original. Without the original, there
is no way of determining on its face whether the facsimile pleading is genuine and authentic and was
originally signed by the party and his counsel. It may, in fact, be a sham pleading.
FERNANDO V. GONZALES v. COMMISSION ON ELECTIONS, et al.
G.R. No. 192856, March 8, 2011, EN BANC (Villarama, J.)
In the cases where a motion for reconsideration was held to be pro forma, the motion was so
held because (1) it was a second motion for reconsideration, or (2) it did not comply with the rule that
the motion must specify the findings and conclusions alleged to be contrary to law or not supported by
the evidence, or (3) it failed to substantiate the alleged errors, or (4) it merely alleged that the decision
in question was contrary to law, or (5) the adverse party was not given notice thereof.
Fernando Gonzales (Gonzales) and Reno Lim (Lim) filed their certificates of candidacy for the
position of Representative of the 3rd congressional district of the Province of Albay in the 2010
elections. Stephem Bichara (Bichara) filed a petition for disqualification and cancellation of
certificate of candidacy (COC) on the ground that Gonzales is a Spanish national and that he failed to
elect Philippine citizenship upon reaching the age of majority. Gonzales denied having willfully made
false and misleading statement in his COC regarding his citizenship. The COMELEC Second Division
granted the petition and declared Gonzales to be disqualified as a candidate. Gonzales filed a motion
for reconsideration of the resolution as the petition was improper. The COMELEC En Banc denied the
motion and affirmed his disqualification. The motion for reconsideration filed by Gonzalez was pro
forma and hence it did not suspend the effects of the resolution disqualifying him as a candidate,
conformably with Sections 1 and 4, Rule 19 of the COMELEC Rules of Procedure in relation to Section
7 of COMELEC Resolution No. 8696. Gonzales no contends that the COMELEC gravely abused its
discretion when it disqualified him and denied his motion for reconsideration.
ISSUE:
Whether or not the motion for reconsideration was pro forma, thus, did not suspend the
effects of the COMELEC resolution disqualifying Gonzales as a candidate.
RULING:
NO. Mere reiteration of issues already passed upon by the court does not automatically make
a motion for reconsideration pro forma. What is essential is compliance with the requisites of the
Rules. Indeed, in the cases where a motion for reconsideration was held to be pro forma, the motion
was so held because (1) it was a second motion for reconsideration, or (2) it did not comply with the
rule that the motion must specify the findings and conclusions alleged to be contrary to law or not
supported by the evidence, or (3) it failed to substantiate the alleged errors, or (4) it merely alleged
that the decision in question was contrary to law, or (5) the adverse party was not given notice
thereof.
In this case, the motion for reconsideration filed by Gonzalez failed to show that it suffers
from the foregoing defects. Although the motion repeatedly stressed that the people of the 3rd District
of Albay chose the Gonzales to represent them in the House of Representatives, it also reiterated his
position that the petition filed by Bichara is time-barred, adding that it was just an act of political
harassment. But the main argument asserts that the evidence of Bichara was insufficient to justify
the Second Division’s ruling that Gonzalez is not a natural-born Filipino and hence disqualified to be
a candidate. Under prevailing jurisprudence, to successfully challenge Gonzalez’s disqualification,
Bichara must clearly demonstrate that Gonzalez’s ineligibility is so patently antagonistic to
constitutional and legal principles that overriding such ineligibility and thereby giving effect to the
apparent will of the people would ultimately create greater prejudice to the very democratic
institutions and juristic traditions that our Constitution and laws so zealously protect and promote.
The COMELEC thus seriously erred in ruling that Gonzalez’s motion for reconsideration
was pro forma. Gonzalez’s motion for reconsideration having been timely filed, the resolution had not
become final and executory. Considering that at the time of the proclamation of Gonzalez who
garnered the highest number of votes for the position of Representative in the 3rd district of Albay,
the resolution declaring Gonzalez disqualified as a candidate for the said position was not yet final,
he had at that point in time remained qualified. Therefore, his proclamation by the PBOC was valid
or legal.
SPOUSES ANTONIO F. ALAGAR AND AURORA ALAGAR v. PHILIPPINE NATIONAL BANK

G.R. No. 171870, March 16, 2011, SECOND DIVISION (Abad, J.)
A motion for reconsideration which raised new arguments complies with requirements of
Sections 1 and 2, Rule 37 of the Rules of Court. Thus, it cannot be considered pro forma and will not toll
the running of the period to appeal.
Spouses Antonio and Aurora Alagar (Spouses Alagar) obtained a loan from Philippine
National Bank (PNB) secured by a mortgage. Spouses Alagar subsequently increased their loan with
corresponding amendments to the mortgage. Meanwhile, PNB gave New Taj Resources, Inc., a
corporation owned by Spouses Alagar, a loan secured by a mortgage. Spouses Alagar also executed a
joint and solidary agreement that bound them with other persons to pay the corporate loan to the
bank. After a few years, Spouses Alagar negotiated with PNB as to the outstanding balance on their
personal loan and requested the condonation of interests so they could settle their debt. Meantime
they paid PNB, while awaiting approval of their request. When PNB granted it, they paid the balance
and sought the release of the title to them. PNB refused, however, citing their other unsettled account.
Spouses Alagar filed a petition for mandamus to compel PNB to release the title to them,
claiming that they already paid their personal loan. The Regional Trial Court (RTC) ruled in favor of
the Spouses Alagar. RTC denied PNB’s motion for failing to raise new matters. This prompted PNB to
file a notice of appeal. The RTC denied the same on the ground that the bank filed it beyond the
required 15-day period. The court said that, since PNB’s motion for new trial or reconsideration
was pro forma, it did not toll the running of the period to appeal.
Meantime, on motion of Spouses Alagar, RTC issued a writ of execution against PNB. This
prompted the PNB to file a special civil action of certiorari. In view of RTC’s conflicting directives,
PNB filed a motion for clarification. RTC resolved’ PNBs motion for clarification and recalling in the
meantime the writ of execution that it issued. The CA annulled all the RTCs orders when the RTC
denied as pro forma PNB’s motion for reconsideration. The CA held that the motion was not pro
forma and, therefore, it tolled the running of the period to appeal. PNB did not belatedly file its notice
of appeal, as it still had three days to elevate RTC’s decision to the CA. Consequently, the decision did
not become final and executory and could not be the subject of a writ of execution. Spouses Alagar
assert that PNB availed of the wrong remedy when it filed a special civil action of certiorari before
the CA rather than one of mandamus to compel the RTC to give due course to its notice of appeal after
the latter held that its pro forma motion for reconsideration did not toll the period of appeal which
had then already elapsed
ISSUE:
Whether or not the CA erred in failing to rule that PNB’s petition before it was not the proper
remedy for assailing the order that denied due course to its appeal.
RULING:
NO. A reading of PNB’s allegations in its petition shows that its action was not only
for certiorari and prohibition but also for mandamus. PNB alleged that by its whimsical, capricious
and arbitrary actions the RTC deprived the PNB of its appeal, leaving it with no other plain, speedy,
and adequate remedy in the ordinary course of law. The PNB petition also specifically prayed the CA
to direct the trial court to give due course to its appeal. Following the rule that the nature of an action
is determined by the allegations of the pleading and the character of the relief sought, it is
unmistakable it was also a petition for mandamus.
Spouses Alagar fail to show any reversible error in the CA’s decision. That court’s finding that
PNB’s motion for reconsideration was not pro forma and, therefore, tolled the running of PNBs period
to appeal, is supported by the evidence on record. The motion for reconsideration specified the RTCs
findings and conclusions in its decision that PNB thought to be contrary to law. The latter even raised
new arguments, not previously considered by RTC which even the latter recognized. From all
indications, the motion for reconsideration complied with requirements of Sections 1 and 2, Rule 37
of the Rules of Court. Thus, it was grave abuse of discretion for the trial court to have simply
concluded that the motion was pro forma and did not toll the running of the period to appeal. The
RTC should have given due course to PNB’s appeal.
Extrinsic Fraud
PEOPLE OF THE PHILIPPINES, et. al v. HON. COURT OF APPEALS,AND SOCORRO FLORECE

Extrinsic fraud refers to any fraudulent act of the prevailing party in litigation committed
outside of the trial of the case, whereby the defeated party is prevented from fully exhibiting his side of
the case by fraud or deception practiced on him by his opponent.
The instant case stemmed from a criminal complaint filed by the People, et. al against Hilario
Florece (Hilario) and his wife Socorro Florece (Socorro) for falsification of public document. In the
said complaint, Felix, et. al alleged that after the death of their parents, they, together with their other
siblings, orally partitioned thee parcel of land owned by their parents amongst themselves. Later,
Felix decided to erect a nipa hut in said parcel of land. However, Hilario protested the same, claiming
that said parcel of land was already registered under his name and that he acquired the same by
virtue of a deed of transfer from his parents. Hilario’s parents, in turn, acquired the property from
the Felix, et. al as evidenced by a Deed of Absolute Sale.
Claiming that they never executed said Deed of Absolute Sale, Felix, et. al filed a complaint
before the Provincial Prosecutors Office, which after finding probable cause, filed the corresponding
Information with the MCTC which found Hilario and Socorro guilty of the crime charged. The
Regional Trial Court (RTC) affirmed and denied the motion for reconsideration. Hilario died pending
appeal.
Thereafter, Socorro filed a Petition for Review with the Court of Appeals (CA). The CA
acquitted her stating that although the prosecution was able to prove that the questioned deed was
indeed forged, nevertheless, the CA pointed out that Hilario and Socorro were not parties and were
never shown to have participated in the execution of the Deed of Absolute Sale, and thus, could not
be presumed to be the forgers thereof. Hence, this petition under Rule 45.
ISSUE:
Whether or not the CA had committed reversible error and/or grave abuse of discretion in
reversing the Decision of the RTC which convicted the respondent Socorro on the ground of extrinsic
fraud.
RULING:
NO. Extrinsic fraud refers to any fraudulent act of the prevailing party in litigation committed
outside of the trial of the case, whereby the defeated party is prevented from fully exhibiting his side
of the case by fraud or deception practiced on him by his opponent, such as by keeping him away
from court, by giving him a false promise of a compromise, or where the defendant never had the
knowledge of the suit, being kept in ignorance by the acts of the plaintiff, or where an attorney
fraudulently or without authority connives at his defeat.
In the instant case, none of the foregoing circumstances exist. The records would show that
in the CA, the People of the Philippines was represented by the Office of the Solicitor General (OSG).
Thus, the People of the Philippines was not prevented from fully exhibiting its case before the CA.
The fact that Felix, et. al were not able to participate in the proceedings before the CA is
immaterial. Insofar as they are concerned, they were not parties to the criminal case. As private
complainants in the said case, they were merely witnesses for the prosecution. It is well-settled that
in criminal cases where the offended party is the State, the interest of the private complainant or the
private offended party is limited to the civil liability. If a criminal case is dismissed by the trial court
or if there is an acquittal, an appeal therefrom on the criminal aspect may be undertaken only by the
State through the Solicitor General. Only the Solicitor General may represent the People of
the Philippines on appeal. The private offended party or complainant may not take such
appeal. However, the said offended party or complainant may appeal the civil aspect despite the
acquittal of the accused.
AFP MUTUAL BENEFITASSOCIATION, INC. v. REGIONAL TRIAL COURT, MARIKINA CITY

BRANCH 193 and SOLID HOMES, INC.
G.R. No. 183906, 14 February 2011, SECOND DIVISION, (Abad, J.)
Res judicata is the principle that a matter may not, generally, be relitigated once it has been
judged on the merits.
In 1976 Investco, Inc. (Investco) entered into a contract to sell to Solid Homes, Inc. certain
properties in Quezon City and in Marikina City. But, because Solid Homes defaulted in payments,
Investco sued for specific performance and damages. During the pendency of the action, Investco sold
the properties to the Armed Forces of the Philippines Mutual Benefits Association, Inc.
(AFPMBAI). Following full payment of the consideration of the sale, the Register of Deeds issued new
certificates of title to AFPMBAI covering the properties.
Subsequently, Solid Homes filed an action against the Register of Deeds, AFPMBAI, and
Investco with the Regional Trial Court (RTC) of Marikina City for annotation of lis pendens and
damages. When the matter reached the Court through two related cases, it rendered a decision,
directing the Register of Deeds to cancel Solid Homes notice of lis pendens on AFPMBAIs titles and
declared AFPMBAI a buyer in good faith and for value.
On August 26, 2003 Solid Homes filed another action with the RTC of Marikina City to cancel
the same certificates of title of AFPMBAI. On motion filed by the latter, however, the RTC issued an
order, dismissing the complaint on ground of res judicata in view of the decision in the previous
actions. Solid Homes filed a motion for reconsideration but the RTC denied it. Undeterred, Solid
Homes filed a petition for relief from judgment, that is, from the order of dismissal, claiming that
Investco and AFPMBAI committed extrinsic fraud in the proceedings that led to the judgment that
the Court rendered against Solid Homes.
ISSUE:
Whether or not Solid Homes petition for relief based on AFPMBAIs alleged fraud in acquiring
its titles to the subject property is barred by res judicata.
RULING:
YES. The extrinsic fraud that will justify a petition for relief from judgment is that fraud which
the prevailing party caused to prevent the losing party from being heard on his action or
defense. Such fraud concerns not the judgment itself but the manner in which it was obtained. For
example, the petition of a defending party would be justified where the plaintiff deliberately caused
with the process servers connivance the service of summons on defendant at the wrong address and
thus succeeded in getting a judgment by default against him.
Here, the fraud that Solid Homes proposed as ground for its petition for relief is Investco and
AFPMBAIs alleged prior knowledge of the sale of the disputed lands to Solid Homes, which fraud goes
into the merit of the case rather than on Solid Homes right to be heard on its action. In effect the RTC
will rehear the issue of whether or not AFPMBAI was a buyer in good faith, an issue barred by res
judicata since the Court has already decided the same with finality in the latters favor. The principle
of res judicata holds that issues actually and directly resolved in a former suit cannot be raised in any
future case between the same parties.
Execution, Satisfaction and Effect of Judgments
SPOUSES FRANCISCO D. YAP and WHELMA S. YAP v. SPOUSES ZOSIMO DY, SR., et al.
G.R. No. 171868/ G.R. No. 171991, 27 July 2011, FIRST DIVISION (Villarama, J.)
As held in Natino v. Intermediate Appellate Court, the tender of the redemption money may be
made to the purchaser of the land or to the sheriff. If made to the sheriff, it is his duty to accept the tender
and execute the certificate of redemption.
The Tirambulos executed a Real Estate Mortgageover Lots 1, 4, 5, 6 and 8 in favor of the Rural
Bank of Dumaguete, Inc., predecessor of Dumaguete Rural Bank, Inc. (DRBI), to secure a P105,000
loan extended by the latter to them. Later, the Tirambulos obtained a second loan for P28,000 and
also executed a Real Estate Mortgage over Lots 3 and 846 in favor of the same bank on August 3,
1978.
The Tirambulos defaulted to pay their loans to DRBI. Thus, DRBI extrajudicially foreclosed
the December 3, 1976 mortgage and had Lots 1, 4, 5, 6 and 8 sold at public auction, wherein DRBI
was proclaimed as the highest bidder and bought said lots for P216, 040.93. Upon redemption, the
Dys and the Maxinos went to the Office of the Sheriff of Negros Oriental and paid P50,625.29
(P40,000.00 for the principal plus P10,625.29 for interests and Sheriffs Commission) to effect the
redemption.
In a letter to the Provincial Sheriff on May 31, 1984, the Yaps refused to take delivery of the
redemption price arguing that one of the characteristics of a mortgage is its indivisibility and that
one cannot redeem only some of the lots foreclosed because all the parcels were sold for a single
price at the auction sale. On June 1, 1984, the Provincial Sheriff wrote the Dys and the Maxinos
informing them of the Yaps refusal to take delivery of the redemption money and that in view of said
development, the tender of the redemption money was being considered as a consignation.
ISSUE:
Whether or not the Tirambulos are correct in tendering their payment to the Sheriff.
RULING:
YES. Here, the Dys and the Maxinos complied with Section 31, Rule 39 of the Rules of Court.
Well within the redemption period, they initially attempted to pay the redemption money not only
to the purchaser, DRBI, but also to the Yaps. Both DRBI and the Yaps however refused, insisting that
the Dys and Maxinos should pay the whole purchase price at which all the foreclosed properties were
sold during the foreclosure sale. Because of said refusal, the Dys and Maxinos correctly availed of the
alternative remedy by going to the sheriff who made the sale. As held in Natino v. Intermediate
Appellate Court, the tender of the redemption money may be made to the purchaser of the land or to
the sheriff. If made to the sheriff, it is his duty to accept the tender and execute the certificate of
redemption.
YOLANDA LEACHON CORPUZ v. SERGIO V. PASCUA, Sheriff III. Municipal Trial Court in Cities,
Trece Martires City, Cavite
A.M. No. P-11-2972, 28 September 2011, FIRST DIVISION, (Leonardo-De Castro, J.)
The power of the court in executing judgments extends only to properties unquestionably
belonging to the judgment debtor alone.
In a criminal case filed with MTCC against Juanito Corpuz (Juanito) filed by Alicia Panganiban
(Panganiban) for violation of Batas Pambansa Blg. 22, the parties entered into a compromise
agreement. In the compromise agreement, which the court approved, Juanito undertook to pay
Panganiban the sum of Batas Pambansa Blg. 22. Consequently, the criminal case was provisionally
dismissed. However, Juanito failed to pay as scheduled. Hence, a writ of execution was issued by the
MTCC to ordering the levy of the properties of Juanito though Sheriff Sergio Pascua (Pascua). Later,
Sheriff Pascua went to the office of Yolanda Corpuz (Yolanda), the wife of Juanito, demanding the
surrender of her Toyota Town Ace Noah. According to Yolanda, Sheriff Pascua tried to forcibly open
the vehicle. Embarrassed by the incident, Yolanda filed an administrative case against Pascua.
For his part, Pascua alleged that the property is presumed to be conjugal, hence covered by
the Writ of Execution issued by the MTCC. In its report, the Office of the Court Administrator (OCA)
recommended that a regular administrative case be filed against Pascua holding that Pascua is guilty
of neglect of duty.
ISSUE:
Whether or not Pascua’s act of levying the car belonging to Yolanda is proper.
RULING:
NO. The power of the court in executing judgments extends only to properties
unquestionably belonging to the judgment debtor alone. An execution can be issued only against a
party and not against one who did not have his day in court. The duty of the sheriff is to levy the
property of the judgment debtor not that of a third person. A sheriff is not authorized to attach or
levy on property not belonging to the judgment debtor. The sheriff may be liable for enforcing
execution on property belonging to a third party. If he does so, the writ of execution affords him no
justification, for the action is not in obedience to the mandate of the writ. Sheriff Pascua cannot rely
on the presumption that the vehicle is the conjugal property of Juanito and Yolanda. Article 160 of
the New Civil Code provides that all property of the marriage is presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively to the husband or to the wife." However,
for this presumption to apply, the party who invokes it must first prove that the property was
acquired during the marriage. Proof of acquisition during the coverture is a condition sine qua non
to the operation of the presumption in favor of the conjugal partnership. Thus, the time when the
property was acquired is material. There is no such proof in the records of the present case.
Moreover, when Sheriff Pascua proceeded in levying upon Yolanda’s vehicle, he digressed far
from the procedure laid down in Section 9, Rule 39 of the Rules of Court for the enforcement of
judgments which clearly states that the levy upon the properties of the judgment obligor may be had
by the executing sheriff only if the judgment obligor cannot pay all or part of the full amount stated
in the writ of execution. If the judgment obligor cannot pay all or part of the obligation in cash,
certified bank check, or other mode acceptable to the judgment obligee, the judgment obligor is given
the option to immediately choose which of his property or part thereof, not otherwise exempt from
execution, may be levied upon sufficient to satisfy the judgment. If the judgment obligor does not
exercise the option immediately, or when he is absent or cannot be located, he waives such right, and
the sheriff can now first levy his personal properties, if any, and then the real properties if the
personal properties are insufficient to answer for the judgment. Therefore, the sheriff cannot and
should not be the one to determine which property to levy if the judgment obligor cannot
immediately pay because it is the judgment obligor who is given the option to choose which property
or part thereof may be levied upon to satisfy the judgment.
In this case, Sheriff Pascua totally ignored the established procedural rules. Without giving
Juanito the opportunity to either pay his obligation under the MTCC judgment in cash, certified bank
check, or any other mode of payment acceptable to Panganiban; or to choose which of his property
may be levied upon to satisfy the same judgment, Sheriff Pascua immediately levied upon the vehicle
that belonged to Juanito’s wife, Yolanda.
TERESITA GUERRERO-BOYLON v. ANICETO BOYLES, Sheriff III,
Municipal Trial Court in Cities, Branch 2, Cebu City
A.M. No. P-09-2716, 11 October 2011, EN BANC, (Per Curiam)
A sheriff’s compliance with the Rules is not merely directory but mandatory. A sheriff is expected
to know the rules of procedure pertaining to his functions as an officer of the court.
Teresita Guerrero-Boylon (Boylon) charges Aniceto Boyles (Boyles), Sheriff III, Municipal
Trial Court (MTC) in Cities, Branch 2, Cebu City, with neglect of duty in connection with his delay and
refusal to implement the writ of execution/demolition (writ) issued in a forcible entry case docketed
as Civil Case No. R-75.
Boylon is the daughter of Asuncion T. Guerrero, the plaintiff in Civil Case No. R-75. In behalf
of her mother, Boylon moved to implement the final and executory decision in Civil Case No. R-75 in
July 2005. The court in due course issued a writ and assigned Boyles to implement it. According to
Boylon, the scheduled demolition did not take place as Boyles did not show up on time and could not
be reached. In another planned demolition scheduled for the last quarter of 2005, Boyles also failed
to show up. Boyles offered varied excuses to Boylon to justify his non-appearances and his failure to
implement the writ. The writ remained unserved despite Boylon’s entreaties to Boyles for its
immediate service. Boyles also failed to comply with his representations to Boylon that he would
serve the notices to vacate on the occupants of the property. At the intervention of Hon. Anatalio S.
Necesario, the judge who issued the writ, Boyles designated a certain Manuel Tipgos to deliver the
notices to the other occupants in the property. The notices, however, failed to reach the intended
recipients.
Court Administrator Christopher O. Lock required Boyles to file his comment to the letter-
complaint. Boyles denied the accusations in the letter-complaint and prayed for the dismissal of the
complaint. He explained that immediately after the issuance of the writ, he went to serve the writ to
the occupants of the property. Boyles claimed that he failed to implement the writ because none of
the defendants in the civil case were then occupying the property. Boyles also claimed that he refused
to implement the writ because the structures to be demolished were located at a different parcel of
land. He further claimed that Tipgos was not a party to the forcible entry case. Boyles insisted that he
and his team tried to serve the notices to vacate. However, he could not immediately serve them as
he had other court processes to attend to. Boyles also explained that service of the notices to vacate
could not be made either because the gates of the property were locked or because no one answered
their calls. The last attempt of Boyles’s team to serve the notices was through designating Manuel
Tipgos to deliver the notices.
ISSUE:
Whether or not Boyles is liable for simple neglect of duty.
RULING:
NO. A sheriff’s compliance with the Rules is not merely directory but mandatory. A sheriff is
expected to know the rules of procedure pertaining to his functions as an officer of the court.
In this case, the Court finds that Boyles was remiss in performing his mandated duties. In the
first place, Boyles failed to implement and enforce the writ within the prescribed period provided
under the Rules. As the records show, Boyles failed to serve the writ and the notices to vacate to the
occupants of the property within three (3) days. Moreover, Boyles failed to evict the occupants of the
subject property, and to remove their personal belongings, and the structures and improvements
they introduced. Aside from these, Boyles failed to make periodic reports, thus depriving the court of
the opportunity to know and ensure the speedy execution of its decision.
Finally, court personnel should be constantly reminded that any impression of impropriety,
misdeed or negligence in the performance of official functions must be avoided. Those who work in
the Judiciary must adhere to high ethical standards to preserve the courts good name and standing.
They should be examples of responsibility, competence and efficiency, and they must discharge their
duties with due care and utmost diligence, since they are officers of the Court and agents of the law.
Indeed, any conduct, act or omission violative of the norms of public accountability and that may
diminish the faith of the people in the Judiciary should not be allowed.
RUBEN C. REYES v. TANG SOAT ING (JOANNA TANG) and ANDO G. SY

G.R. No. 185620,14 December 2011, SECOND DIVISION (PEREZ, J.)
The burden of evidence to prove lack of compliance with Section 15, Rule 39 of the Rules of Court
rests on the party claiming lack thereof. Notwithstanding the validity of the execution sale and
consolidation of ownership over the subject property upon the lapse of the redemption period, Section
107 of Presidential Decree No. 1529 contemplates the filing of a separate and original action before the
RTC, acting as a land registration court.
MFR Farms, Inc. (MFR) filed a complaint for Enforcement of Easement and Damages with
Prayer for Preliminary Injunction and Restraining Order against Tang and Sy. MFR complained of the
latter’s commercial and industrial use of their property and sought the enforcement of the
encumbrance contained in their title. MFR likewise asked for the payment of damages suffered by its
pig farm resulting from Tang and Sy’s illegal use of their property. The RTC granted MFRs complaint.
The Court of Appeals affirmed. Both parties filed their separate appeals by certiorari to this Court,
unfortunately, both were dismissed for late payment of legal fees and late filing of the petition. Upon
motion of MFR, the RTC issued a Writ of Execution.After more than five (5) years after the execution
sale and Tang and Sy’s failure to redeem, MFR filed a Motion asking the RTC to issue an order
directing the Register of Deeds to issue a new certificate of title in the name of MFR. The RTC denied
the Motion holding that a mere motion is not sufficient for the cancellation of a certificate of title.
MFR filed a Petition with the same prayer. The RTC granted the Petition. The CA reversed.
Reyes argues that to require him to file his petition in another court would unduly divest the
RTC of its jurisdiction to enforce its final and executory decision. Reyes invokes our ruling in Natalia
Realty, Inc. v. Court of Appeals where we declared that jurisdiction of the court to execute its judgment
continues even after the judgment has become final for the purpose of enforcement of judgment.
ISSUE:
Whether the execution sale of the subject property void.
RULING:
NO. The burden of evidence to prove lack of compliance with Section 15, Rule 39 of the Rules
of Court rests on the party claiming lack thereof. Tang and Sy made no attempt to meet this burden
of evidence, simply maintaining lack of notice of the entire proceedings (execution and issuance of a
new title over the subject property) before the trial court. The Court cannot subscribe to Tang and
Sy’s belated posturing. The disputable presumption that official duty has been regularly performed
was not overcome by them. On the whole, their silence and inaction for eight (8) years from the time
the subject property was validly levied upon by the RTC, bars them from claiming invalidity of the
execution proceedings.
SPOUSES BENJAMIN and NORMA GARCIA v. ESTER GARCIA, et al.

G.R. No. 169157,14November 2011, THIRD DIVISION (PERALTA, J.)
Knowledge of the existence of the pending litigation estops a party from invoking the rule on
indispensable party to question the jurisdiction of the court.
Emilio Garcia (Emilio) had nine (9) children with his first wife, including Rita and Benjamin,
and Ester, Amado, Adela, Rosa and David, all surnamed Garcia. Emilio had 8 children with his second
wife, Monica. Emilio died intestate. Benjamin and Rita executed a Deed of Extrajudicial Settlement of
Estate, declaring themselves as the sole and only heirs of Emilio, and adjudicating unto themselves
the subject property. Emilio’s daughters (Irma and Imelda) of his second marriage filed a complaint
against Rita and Benjamin for the annulment of title but the parties, thereafter, entered into a
Compromise Agreement which was approved by the court. However, Ester, et. al filed a complaint for
reconveyance, against Rita, Benjamin, and Monica and her children. They alleged that as heirs of
Emilio they are entitled to their shares to the property.
The Regional Trial Court (RTC) ruled in favor of Ester Garcia, et al. The CA affirmed. The
decision then attained finality. Meanwhile, Norma filed a Petition for Quieting of Title claiming that,
as buyer, she is the owner of a portion of the property subject of the writ and that she was not made
a party to the reconveyance case. The case, however, was dismissed on the ground of res judicata.
The corresponding Writ of Execution was issued but petitioners Benjamin and Garcia opposed the
implementation of the writ. The RTC denied the motion to quash. In a special civil action
for certiorari, the Court of Appeals (CA) found no grave abuse of discretion on the part of the RTC in
issuing the above orders.
ISSUE:
Whether the CA erred in affirming the execution of the writ.
RULING:
NO. Although, Ester Garcia, et al. were not parties to the annulment case or to the compromise
agreement, their rights to the subject property as heirs of Emilio were recognized. Although it was
not specifically stated in the compromise agreement, the shares of the children of the first marriage
should be taken from portions in the name of Rita and Benjamin. Benjamin’s claim that the portion
of the property registered in his name is not covered by the compromise agreement, certainly, has
no leg to stand on.
As for the claim of non-inclusion of Norma in the reconveyance case, Norma, however, is
estopped from invoking the rule on indispensable party to exclude her and her property from the
execution writ. The CA has thoroughly explained the circumstances showing Norma’s knowledge of
the existence of the pending litigation involving the subject property which includes the portion
registered in her name. Therefore, she is now estopped from claiming that the RTC had not acquired
jurisdiction over her and thus not bound by the decision sought to be executed.
PROSERPINA V. ANICO v. EMERSON B. PILIPIA, Sheriff IV, Office of the Clerk of Court, Regional
Trial Court, Manila
A.M. No. P-11-2896, 2 August 2011, EN BANC, (Corona, CJ)
The sheriff is required to secure the court’s prior approval of the estimated expenses and fees
needed to implement the court process.
Proseprina Anico (Anico) was a party who obtained a favorable judgment in a case for
collection of sum of money, specific performance, and damages. A Writ of Execution was issued for
the implementation of said decision. The writ was forwarded to the Office of the Clerk of Court, RTC,
Manila and was assigned to Sheriff Emerson Pilipia for execution. Anico called Pilipia and inquired
the status of the execution. Pilipia demanded the amount of P5,000.00 to defray his expenses in the
implementation of the writ. Anico made another follow-up on the status of the writ since the same
remained unimplemented. She claimed that Pilipia again demanded the amount of P2,000.00,
allegedly to defray his gasoline expenses. Anico inquired again, this time from Branch 32, the status
of the writ. She then learned that Pilipia made no return of the writ even after a lapse of one
year. Dissatisfied, Anico filed the instant administrative complaint against respondent sheriff.
Sheriff Pilipia denied the accusations against him. He claimed that he immediately served the
writ and notice to pay judgment to defendant Robin Taguinod but, being a seafarer, he was out of the
country. He instead opted to leave the copies of the writ and notice to defendant's relative. He also
attempted to serve the same writ and notice to pay judgment to the other defendant, Jerome T.
Cayabyab, at the Coastguard Headquarters, but to no avail, as defendant was allegedly on board a
ship.Pilipiaasserted that he did not violate any rule in the implementation of the writ and was never
remiss in the performance of his duties and responsibilities as an officer of the court.
The Office of the Court Administrator (OCA) found Pilipia guilty of conduct prejudicial to the
best interest of the service and recommended the penalty of suspension of one (1) year.
ISSUE:
Whether or not OCA’s recommendation should be adopted.
RULING:
YES. Under Section 9, Rule 141 of the Rules of Court, the sheriff is required to secure the
court’s prior approval of the estimated expenses and fees needed to implement the court process.
The rule requires the sheriff executing writs or processes to estimate the expenses to be incurred.
Upon the approval of the estimated expenses, the interested party has to deposit the amount with
the Clerk of Court and ex-officio Sheriff. The expenses shall then be disbursed to the executing Sheriff
subject to his liquidation within the same period for rendering a return on the process or writ. Any
unspent amount shall be refunded to the party who made the deposit. In the instant case, none of
these procedures were complied with by respondent sheriff.
Likewise, Section 14, Rule 39 of the Rules of Courtprovide that it is mandatory for sheriffs to
execute and make a return on the writ of execution within 30 days from receipt of the writ and every
30 days thereafter until it is satisfied in full or its effectivity expires. Even if the writs are unsatisfied
or only partially satisfied, sheriffs must still file the reports so that the court, as well as the litigants,
may be informed of the proceedings undertaken to implement the writ.
Appeal
SPOUSES ROGELIO MARCELO and MILAGROS MARCELO v. LBC BANK

The Court of Appeals shall have the power to try cases and conduct hearings, receive evidence
and perform any and all acts necessary to resolve factual issues raised in cases falling within its original
and appellate jurisdiction, including the power to grant and conduct new trials or further proceedings.
Spouses Rogelio and Milagros Marcelo (Spouses Marcelo) obtained a P3 million loan from
LBC Bank. Spouses Marcelo then obtained another loan from LBC Bank in the amount of P2.3 million.
The two loans were secured by a real estate mortgage over a parcel of land located in Baliuag,
Bulacan. Spouses Marcelo defaulted in the payment of their loans. Consequently, LBC Bank sought
the extra-judicial foreclosure of the real estate mortgage.
The Office of the Clerk of Court and the Ex-Officio Sheriff of Malolos, Bulacan, issued a Notice
of Sheriff’s Sale. After the posting and publication of the Notice of Sale, the mortgaged property was
sold at a public auction. LBC Bank, being the highest bidder, was issued a Certificate of Sale, which
was eventually registered with the Bulacan Registry of Deeds. Spouses Marcelo failed to redeem the
property within the prescribed period. As a result, LBC Bank’s Mecauayan Branch Manager, Ricardo
B. Milan, Jr. (Milan), executed an Affidavit of Consolidation of Title, which was filed with the Bulacan
Registry of Deeds. Spouses Marcelo’s title to the subject property was cancelled and TCT No. T-
145323 was issued in LBC Bank’s name. LBC Bank then filed with the Regional Trial Court (RTC) an
issuance of a writ of possession over the foreclosed property which was granted.
The Spouses Marcelo filed a petition for certiorari with the Court of Appeals (CA). The CA
initially granted the petition. However, LBC Bank filed a motion for reconsideration attaching several
affidavits. The CA amended its decision granting the motion for reconsideration. The Court then
denied the motion for reconsideration filed by Spouses Marcelo.
ISSUE:
Whether or not the Court of Appeals can admit new evidence in a special civil action for
certiorari.
RULING:
NO. In Maralit v. Philippine National Bank, where Maralit questioned the appellate court’s
admission and appreciation of a belatedly submitted documentary evidence, the Court held that in a
special civil action for certiorari, the Court of Appeals has ample authority to receive new evidence
and perform any act necessary to resolve factual issues. The Court explained further:
Section 9 of Batas Pambansa Blg. 129, as amended, states that, "The Court of
Appeals shall have the power to try cases and conduct hearings, receive evidence and
perform any and all acts necessary to resolve factual issues raised in cases falling within
its original and appellate jurisdiction, including the power to grant and conduct new
trials or further proceedings."
Likewise, in VMC Rural Electric Service Cooperative, Inc. v. Court of Appeals, the Court held that
“It is already settled that under Section 9 of Batas Pambansa Blg. 129, as amended by Republic Act
No. 7902 (An Act Expanding the Jurisdiction of the Court of Appeals, amending for the purpose of
Section Nine of Batas Pambansa Blg. 129 as amended, known as the Judiciary Reorganization Act of
1980), the Court of Appeals — pursuant to the exercise of its original jurisdiction over Petitions for
Certiorari — is specifically given the power to pass upon the evidence, if and when necessary, to
resolve factual issues.”
Clearly, the Court of Appeals did not err in admitting the evidence showing LBC Bank’s
express ratification of Milan’s consolidation of the title over the subject property. Further, the Court
of Appeals did not err in admitting such evidence in resolving LBC Bank’s motion for reconsideration
in a special civil action for certiorari. To rule otherwise will certainly defeat the ends of substantial
justice.
LAND BANK OF THE PHILIPPINES v. COURT OF APPEALS and ELIZABETH DIAZ, represented
by FRANCISCA P. DE GUZMAN as Attorney-in-Fact
The proper mode of appeal from decisions of Regional Trial Courts sitting as SACs is by petition
for review under Rule 42 of the Rules of Court and not through an ordinary appeal under Rule 41.
Elizabeth Diaz (Diaz) was a registered owner of a parcel of agricultural land situated in Nueva
Ecija. The Department of Agrarian Reform (DAR) then expropriated the land. DAR valued the
expropriated land, however, Diaz was not satisfied with the valuation, thus, she filed a complaint
against Land Bank of the Philippines (LBP) before a Special Agrarian Court (SAC) through her
attorney-in-fact Francisca De Guzman (De Guzman). SAC adopted the valuation of DAR. Diaz then
filed a motion for reconsideration, which was denied.
The case was elevated to the Court of Appeals (CA). Upon motion, DAR and LBP failed for file
their appellees’ brief. LBP then filed a motion for leave to admit the brief and to dismiss the petition
maintaining the contention that wrong remedy was availed by the party. According to LBP, ordinary
appeal is the wrong remedy, the proper mode being by way of petition for review, citing Section 60
of the Comprehensive Agrarian Reform Law. Hence, LBP concluded that the CA has no jurisdiction
over the case. CA denied the petition of LBP.
ISSUE:
Whether or not the mode of appeal used by the lawyer of Diaz is correct.
RULING:
NO. Following Land Bank of the Philippines v. De Leon, the proper mode of appeal from
decisions of Regional Trial Courts sitting as SACs is by petition for review under Rule 42 of the Rules
of Court and not through an ordinary appeal under Rule 41. The Court, in the immediately cited case
of Land Bank, observing that "before the instant case reached us, Land Bank of the Philippines had
no authoritative guideline on how to appeal decisions of SACs considering the seemingly conflicting
provisions of Sections 60 and 61 of RA 6657," held that "Sec. 60 of RA 665712 clearly and
categorically states that the said mode of appeal petition for review should be adopted."
There is no conflict between Sections 60 and 61 of RA 6657 inasmuch as the Rules of Court
do not at all prescribe the procedure for ordinary appeals as the proper mode of appeal for decisions
of Special Agrarian Courts. Section 61 in fact makes no more than a general reference to the Rules of
Court and does not even mention the procedure for ordinary appeals in Section 2, Rule 41 of the 1997
Revised Rules of Civil Procedure as the appropriate method of elevating to the Court of Appeals
decisions of Special method of elevating to the Court of Appeals decisions of Special Agrarian Courts
in eminent domain cases. Moreover, the failure to mention Special Agrarian Courts in Section 1 of
Rule 43 of the Revised Rules of Civil Procedure cannot be construed to mean that a petition for review
is not permissible for decisions of the said special courts. In fact, the said Rule is not relevant to
determine whether a petition for review is the proper mode of appeal from decisions of Regional
Trial Courts in agrarian cases, that is, why they act as Special Agrarian Courts. Section 1 of Rule 43 of
the 1997 Revised Rules of Civil Procedure merely mentions the Court of Tax Appeals and the other
different quasi-judicial agencies without exclusivity in its phraseology.
Lastly, far from being in conflict, Section 61 of RA 6657 can easily be harmonized with Section
60. The reference to the Rules of Court means that the specific rules for petitions for review in the
Rules of Court and other relevant procedures in appeals filed before the Court of Appeals shall be
followed in appealed decisions of Special Agrarian Courts. Considering that RA 6657 cannot and does
not provide the details on how the petition for review shall be conducted, a suppletory application of
the pertinent provisions of the Rules of Court is necessary. In fact, Section 61 uses the word "review"
to designate the mode by which the appeal is to be effected. The reference therefore by Section 61 to
the Rules of Court only means that the procedure under Rule 42 for petitions for review is to be
followed for appeals in agrarian cases.
REBECCA T. ARQUERO v. CA, et al.

A defendant declared in default retains the right to appeal from the judgment by default on the
ground that the plaintiff failed to prove the material allegations of the complaint, or that the decision is
contrary to law, even without need of the prior filing of a motion to set aside the order of default except
that he does not regain his right to adduce evidence. The appellate court, in turn, can review the assailed
decision and is not precluded from reversing the same based solely on the evidence submitted by the
plaintiff.
Congress approved Republic Act (RA) No. 6765, wherein several schools were converted into
national schools and integrated with the Palawan National School (PNS) in the City of Puerto
Princesa, Province of Palawan, as branches thereof. The law also provides that the Palawan
Integrated National Schools (PINS) shall be headed by a Vocational School Superintendent (VSS) who
shall be chosen and appointed by the Secretary of the Department of Education, Culture, and Sports
(now the DepEd). However, no VSS was appointed. Instead, then DECS Region IV Office designated
then PNS Principal Eugenio J. dela Cuesta in a concurrent capacity as Officer-in-Charge (OIC) of the
PINS. After the retirement of Dela Cuesta, Rebecca Arquero (Arquero) took over as Secondary School
Principal of the PNS. Dr. Giron however withdrew the designation of Arquero as OIC of the PINS,
enjoining her from submitting to the Regional Office all appointments and personnel movement
involving the PNS and the satellite schools. Arquero then appealed to the Civil Service Commission
assailing the withdrawal of her designation as OIC of the PINS. She filed a Motion for Reconsideration
and/or Clarification before the Office of the DepEd Secretary as to the designation of (private
respondent) Norma Brillantes.
Dr. Giron filed a formal charge against petitioner who continued to defy the orders issued by
the Regional Office relative to the exercise of her functions as OIC of the PINS despite the designation
of Brillantes as such. The administrative complaint charged Arquero with grave misconduct, gross
insubordination and conduct prejudicial to the best interest of the service. In turn, Arquero filed the
Petition for Quo Warranto before the Regional Trial Court (RTC) against De Jesus, et.al. Arquero
argued that the designation of Brillantes deprived her of her right to exercise her function and
perform her duties in violation of her right to security of tenure.
The RTC rendered a Judgment by Default, declaring Arquero as the lawful Principal and Head
of the Palawan Integrated National High School who is lawfully entitled to manage the operation and
finances of the school subject to existing laws. On appeal, the CA reversed and set aside the RTC
decision. Hence, this petition.
ISSUE:
Whether or not De Jesus, et. al could not have appealed the RTC decision having been declared
in default.
RULING:
NO. One of the remedies of a party declared in default under Sec. 2, Rule 41 is that “He may
also appeal from the judgment rendered against him as contrary to the evidence or to the law, even
if no petition to set aside the order of default has been presented by him.” Undoubtedly, a defendant
declared in default retains the right to appeal from the judgment by default on the ground that the
plaintiff failed to prove the material allegations of the complaint, or that the decision is contrary to
law, even without need of the prior filing of a motion to set aside the order of default except that he
does not regain his right to adduce evidence. The appellate court, in turn, can review the assailed
decision and is not precluded from reversing the same based solely on the evidence submitted by the
plaintiff.
In an appeal by certiorari under Rule 45, only questions of law may be reviewed.
Republic of the Philippines is the registered owner of two (2) parcels of land known as the
Tala Estate. Under Proclamation No. 843, a portion of the Tala Estate was reserved for housing,
resettlement sites and related purposes by the government under the supervision and
administration of the National Housing Authority (NHA).On the other hand, Sps. Guilalas, are the
registered owners of a parcel of land located in San Jose Del Monte, Bulacan.
Eventually, the NHA started the development of the portion of the Tala Estate. However, Sps.
Guilalas resisted the development of the area claiming that a portion of their land was encroached
upon by the government. After an investigation was by NHA, it was found that the land owned by the
Sps. Guilalas was part and parcel of the Tala Estate.Thus, the Republic filed a Complaint for
Cancellation of Title them. In their Answer, Sps. Guilalas claimed that the RTC of Caloocan City had
no jurisdiction over the case since their lot is situated in Bulacan. Further, they maintained that they
have been in open, adverse and continuous possession of the subject lot since birth and have been
actually tilling the same in the concept of an owner.
After trial, the Regional Trial Court (RTC) rendered a Decision in favor of the Sps. Guilalas.
The Republic, through the Office of the Solicitor General (OSG), sought recourse before the CA. The
CA concluded that based on the evidence, it is apparent that Sps. Guilalas’ lot is beyond the
boundaries of the Tala Estate. Thus, outside the jurisdiction of the RTC Caloocan City. Hence, this
petition.
ISSUE:
Whether or not the Republic can raise questions of fact in its petition for review on certiorari
under Rule 45.
RULING:
NO. The well-entrenched rule in our jurisdiction that only questions of law may be
entertained by this Court in a petition for review on certiorari is not ironclad and admits certain
exceptions, such as when (1) the conclusion is grounded on speculations, surmises or conjectures;
(2) the inference is manifestly mistaken, absurd or impossible; (3) there is grave abuse of discretion;
(4) the judgment is based on a misapprehension of facts; (5) the findings of fact are conflicting; (6)
there is no citation of specific evidence on which the factual findings are based; (7) the findings of
absence of facts are contradicted by the presence of evidence on record; (8) the findings of the Court
of Appeals are contrary to those of the trial court; (9) the Court of Appeals manifestly overlooked
certain relevant and undisputed facts that, if properly considered, would justify a different
conclusion; (10) the findings of the Court of Appeals are beyond the issues of the case; and (11) such
findings are contrary to the admissions of both parties.
After a careful review of the records, this Court finds no just reason to warrant the application
of any of the foregoing exceptions to the general rule. In the case at bar, based on the findings of fact
of the RTC, as affirmed by the CA, the property of Sps. Guilalas does not encroach the Tala Estate and
correctly falls within the territorial jurisdiction of San Jose Del Monte, Bulacan, and not Caloocan
City. This factual finding binds this Court and is no longer subject to review. Thus, absent a showing
of an error of law committed by the court below, or of whimsical or capricious exercise of judgment,
or a demonstrable lack of basis for its conclusions, this Court may not disturb its factual
findings. Moreover, well-established is the rule that factual findings of the Court of Appeals are
conclusive on the parties and carry even more weight when the said court affirms the factual findings
of the trial court.
METROPOLITAN BANK & TRUST COMPANY v. SPOUSES EDMUNDO MIRANDA and JULIE
MIRANDA
G.R. No. 187917, 19 January 2011, SECOND DIVISION (NACHURA, J.)
Only questions of law may be raised before the Court in a Petition for Review under Rule 45 of
the Revised Rules of Civil Procedure. The Court is not a trier of facts, and it is not the function of this
Court to reexamine the evidence submitted by the parties.
Spouses Edmundo Miranda and Julie Miranda (Sps. Miranda) obtained a loan, from
Metropolitan Bank & Trust Company (Metrobank) and executed a real estate mortgage. Sps. Miranda
encountered difficulties in paying their loans. Consequently, Metrobank caused the extrajudicial
foreclosure and auction sale of the mortgaged properties. Claiming that the extrajudicial foreclosure
was void, Sps. Miranda filed a complaint for Nullification of the Foreclosure Proceedings and
Damages while alleging non-compliance with the publication requirement. Metrobank answered the
complaint, denying its material allegations and asserting the validity of the foreclosure proceedings.
The Regional Trial Court (RTC) rendered a decision annulling the extrajudicial foreclosure
proceedings having found no proof of publication of the sheriff’s notice of sale. It further held that,
when Metrobank foreclosed the mortgaged properties, respondents loan account was still
outstanding for there was an overpayment of interests amounting to P1,529,922.00. Thus, the
foreclosure proceedings were without factual and legal basis. The Court of Appeals (CA) dismissed
the appeal. Metrobank appealed to the Supreme Court insisting on the validity of the foreclosure
proceedings. Essentially, it argues that foreclosure proceedings enjoy the presumption of regularity,
and the party alleging irregularity has the burden of proving his claim.
ISSUE:
Whether there was compliance with the requirements of foreclosure.
RULING:
YES. Only questions of law may be raised before this Court in a Petition for Review under
Rule 45 of the Revised Rules of Civil Procedure. This Court is not a trier of facts, and it is not the
function of this Court to reexamine the evidence submitted by the parties. It has been our consistent
ruling that the question of compliance or non-compliance with notice and publication requirements
of an extrajudicial foreclosure sale is a factual issue, and the resolution thereof by the trial court is
generally binding on this Court.
BARANGAY DASMARIAS v. CREATIVE PLAY CORNERSCHOOL, et al.

G.R. No. 169942,24 January 2011, FIRST DIVISION (DEL CASTILLO, J.)
The Court of Appeals, after it has already allowed petitioner an extension of 15 days within
which to file a petition for review, may only grant a further extension when presented with the most
compelling reason but same is limited only to a period of 15 days.
Barangay Dasmarias thru Ma.Encarnacion R. Legaspi (Legaspi) filed a Complaint-

Affidavit before the Office of the Prosecutor of Makati charging Creative Play Corner School (CPC)
and its alleged owners with Falsification and Use of Falsified Documents. Lebron and Colina,
individual respondents, denied having falsified the subject documents. They averred that
Barangay Dasmarias' assertion that they were owners of CPC is a mere allegation without proof. The
prosecutor recommended the dismissal of the case because of failure to establish probable cause.
The DOJ, on April 25, 2005, dismissed the Petition for Review after finding that no error which would
justify the reversal of the assailed resolution was committed by the prosecutor and that the petition
was filed late. Upon appeal with the Court of Appeals (CA), after two motions for extension were
granted, the barangay filed its Petition for Review only on June 7, 2005. The CA dismissed the petition
for having been filed out of time.
The Barangay filed a Motion for Reconsideration explaining that the request for extension
was allegedly on account of a sudden death in the family of the handling lawyer. Also, it claimed that
the slight delay in the filing of the petition did not after all result to the prejudice of respondents.
More importantly, it believed that the merits of the case justify the relaxation of technical rules. The
CA saw no reason to grant petitioner's Motion for Reconsideration. This notwithstanding, the
Barangay still firmly believes that the case should have been resolved on the merits and hence, it is
now before this Court via this Petition for Review on Certiorari.
ISSUE:
Whether the CA gravely erred in dismissing the Petition for Review on a mere technicality, without
considering the substantive grounds on which the Petition for Review was based.
RULING:
NO. From the above, it is clear that the CA, after it has already allowed petitioner an extension
of 15 days within which to file a petition for review, may only grant a further extension when
presented with the most compelling reason but same is limited only to a period of 15 days. Thus,
when the CA denied Barangay Dasmarias’ Second Motion for Extension of five days, it was merely
following the provision of the rules after it found the reason for the second extension as not
compelling. And, considering that the CA has already sufficiently explained how it was able to arrive
at the conclusion that there is no compelling reason for such second extension, the Court deemed it
unnecessary to repeat the same especially since we are in total agreement with the ratiocination of
the CA.
ALEXANDER B. GATUS v. SOCIAL SECURITY SYSTEM

G.R. No. 174725,26 January 2011, FIRST DIVISION (Leonardo-De Castro, J.)
Questions of fact may not be taken up in a petition for review on certiorari, only questions of
law.
Gatus was a covered member of the SSS. He suffered chest pains and was confined at the
Central Luzon Doctors Hospital in Tarlac City. He was diagnosed to be suffering from Coronary Artery
Disease (CAD): Triple Vessel and Unstable Angina. His medical records showed him to be
hypertensive for 10 years and a smoker. On account of his CAD, he was given by the SSS the following
EC/SSS Permanent Partial Disability (PPD) benefits. Sometime in 2003, an SSS audit revealed the
need to recover the EC benefits already paid to him on the ground that his CAD, being attributed to
his chronic smoking, was not work-related. He was notified thereof through a letter dated July 31,
2003. Convinced that he was entitled to the benefits, he assailed the decision but the SSS maintained
its position. The SSS also denied his motion for reconsideration. The ECC denied his appeal. The CA
affirmed.
ISSUE:
Whether the disease was work-related, and hence, covered by SSS benefits.
RULING:
NO. The burden of proof is on petitioner to show that he was entitled to the benefits he had
applied for, to which Gatus failed to establish by substantial evidence. Also, the questioned Decision
deemed as established fact that petitioner is a cigarette smoker; but petitioner vehemently denies
this, saying there is no competent evidence to prove he had that habit. What petitioner would like
this Court to do is to pass upon a question of fact, which the ECC, the SSS, and the Court of Appeals
have used to deny his claim for compensation. This is not allowed under Section 1 of Rule 45, which
states that "[t]he petition shall raise only questions of law which must be distinctly set forth." Hence,
questions of fact may not be taken up in a petition for review on certiorari such as this case now
before us.
There is no doubt that petitioner deserves sympathy because even the benefits already given
to him were questioned after the SSS found that he was a chronic cigarette smoker. For humanitarian
reasons, as he pursued his claim all the way to the Court as an indigent litigant, and due to his
advancing age, we would like to clarify that what had already been given him should no longer be
taken away from him. But he is not entitled to further compensation for his condition.
SPS. IRENEO T. FERNANDO v. MARCELINO T. FERNANDO

G.R. No. 191889,31 January 2011, THIRD DIVISION (CARPIO-MORALES, J.)
Petitions for review on certiorari under Rule 45 are limited to questions of law as the Court is
not a trier of facts, the rule admits of exceptions including when the factual findings of the trial and
appellate courts are conflicting, in which event this Court may still pass on the same.
The spouses Fernando and Irineos sisters, Juliana T. Fernando (Juliana) and Celerina T.
Fernando (Celerina) were the registered co-owners of three parcels of land. The Ireneo sisters died.
Marcelino T. Fernando (Marcelino) is their full-blood brother. It appears that on November 3, 1994,
Ireneo and Juliana presented before the Register of Deeds of Quezon City a Deed of Partition with
Sale wherein they partitioned equally among themselves the aforementioned properties, thereby
terminating their co-ownership. Still in the same deed, Juliana agreed to sell Lot No. 24 to spouses
Fernando. Marcelino caused the annotation of an Affidavit of Adverse Claim on the TCTs, claiming a
right and interest over the properties, being one of the heirs of his late sister Celerina and also
alleging that Celerina’s signatures on the deed of partition was a forgery as she had passed away on
April 28, 1988, before the deed was purportedly executed in 1994, and that the purported sale by
Juliana of her share over Lot No. 24 in favor of petitioners was simulated and fictitious due to lack of
any valid consideration, which questioned acts had effectively deprived him of his right of pre-
emption or redemption as Celerinas heir.
The RTC ruled in favor of spouses Fernando. It ratiocinated that since there appeared to be
no dispute as to the genuineness of Celerina and Julianas signatures, the notarization of the document
at a later date did not render it void or without legal effect, but merely opened the notary public to
prosecution for possible violation of notarial laws. On appeal, the Court of Appeals (CA) reversed the
trial court’s decision. It held that the deed is void in light of the clear forgery of the signature of
Celerina who could not have given her consent thereto more than six years after her death.
ISSUE:
Whether or not the CA erred in holding that the deed is not genuine.
RULING:
NO. Petitions for review on certiorari under Rule 45 are limited to questions of law as the
Court is not a trier of facts, the rule admits of exceptions including when the factual findings of the
trial and appellate courts are conflicting, in which event this Court may still pass on the same.
A scrutiny of the deed reveals, however, several significant irregularities which belie
petitioners claim of its authenticity. It is thus all too glaring that the deed could not have been, as
advanced by petitioners, actually executed in 1986. For if indeed it was, and without belaboring the
obvious, the entry for the notarial year after the words Series of should have been left in blank,
consistent with the other entries which the notary public would fill in (upon notarization at a later
date). And it bears noting that petitioners never even bothered to present the notary public to testify
on the circumstances surrounding the belated notarization of the deed.
SPOUSES AMADO O. IBAEZ and ESTHER A. RAFAEL-IBAEZ v. REGISTER OF DEEDS

OF MANILA AND CAVITE and PHILIPPINE VETERANS BANK (PVB)
G.R. No. 192500, 2 February 2011, SECOND DIVISION, (Nachura, J.)
Failure to file appellants brief within the period granted by the appellate court results in the
abandonment of the appeal which can lead to its dismissal.
A petition for Injunction and Damages was filed by Spouses Amado O. Ibaez and Esther A.
Rafael-Ibaez, against Philippine Veterans Bank. The Regional Trial Court (RTC) decided against
spouses Ibaez, who eventually elevated the case to the Court of Appeals (CA) via a Notice of Appeal.
In a Notice, spouses Ibaez and their counsel were required to file their appellants brief within 45 days
from receipt of the Notice.
The case was dismissed by the CA on the ground of spouses Ibaez failure to file their appellant
brief despite receipt the Notice sent by the appellate court. The CA thus considered the appeal
abandoned, and accordingly dismissed the same. Noteworthy however is the fact that the notice was
sent by the court to a wrong address.
ISSUE:
Whether or not the dismissal is proper.
RULING:
NO. Indeed, the failure to file appellants brief within the period granted by the appellate
court results in the abandonment of the appeal which can lead to its dismissal upon failure to move
for its reconsideration. However, since it was duly proven that neither spouses Ibaez nor their
counsel actually received the Notice to file brief sent by the CA, there was no abandonment of the
appeal. The CA has, therefore, erred in dismissing spouses Ibaez’ appeal.
F.A.T. KEE COMPUTER SYSTEMS, INC. v. ONLINE NETWORKS INTERNATIONAL, INC.

G.R. No. 171238, 2 February 2011, FIRST DIVISION, (LEONARDO DE CASTRO, J.)
Petition for review on certiorari of the Rules of Court dictates that a petition for review
on certiorari shall raise only questions of law, which must be distinctly set forth. This rule is, however,
subject to exceptions, one of which is when the findings of fact of the Court of Appeals and the RTC are
conflicting.
F.A.T. Kee Computer Systems, Inc. is a domestic corporation engaged in the business of selling
computer equipment and conducting maintenance services for the units it sold. ONLINE is also a
domestic corporation principally engaged in the business of selling computer units, parts and
software. ONLINE sold computer printers to FAT KEE. However, FAT KEE failed to pay its obligations
to ONLINE without any valid reason. ONLINE filed a Complaint for Sum of Money against FAT KEE.
ONLINE asserted in the Complaint that FAT KEE, through its President Frederick Huang, Jr.,
offered to pay its US dollar obligations in Philippine pesos using the exchange rate of P40: US$1. FAT
KEE duly answered the complaint alleging, inter alia, that it did not reach an agreement with ONLINE
for the payment of its obligations in US dollars.
During the trial FAT KEE insisted that the conversion rate they agreed upon was P34:US$1
and not P40 as insisted by ONLINE. The Regional Trial Court (RTC) and Court of Appeals (CA) differs
on the propriety of using the exchange rate. Consequently, when the case was brought to the Supreme
Court via Rule 45, this question was in issue.
ISSUE:
Whether or not the case involves a question of fact.
RULING:
YES. The Court finds that, indeed, questions of fact are being invoked by FAT KEE. A question
of law arises when there is doubt as to what the law is on a certain state of facts, while there is a
question of fact when the doubt arises as to the truth or falsity of the alleged facts. For a question to
be one of law, the same must not involve an examination of the probative value of the evidence
presented by the litigants or any of them.
Rule 45, Section 1 of the Rules of Court dictates that a petition for review
on certiorari shall raise only questions of law, which must be distinctly set forth. This rule is,
however, subject to exceptions, one of which is when the findings of fact of the Court of Appeals and
the RTC are conflicting. Said exception applies to the instant case.
AURORA B. GO v. ELMER SUNBANUN et al.

G.R. N0. 168240, 9 February 2011, FIRST DIVISION, (Del Castillo, J.)
Henceforth, this "fresh period rule" shall also apply to Rule 40 governing appeals from the
Municipal Trial Courts to the Regional Trial Courts; Rule 42 on petitions for review from the Regional
Trial Courts to the Court of Appeals; Rule 43 on appeals from quasi-judicial agencies to the Court of
Appeals and Rule 45 governing appeals by certiorari to the Supreme Court. The new rule aims to
regiment or make the appeal period uniform, to be counted from receipt of the order denying the motion
for new trial, motion for reconsideration (whether full or partial) or any final order or resolution.
In November 2000, Elmer Sunbanun et al. filed a suit for damages against Aurora, before the
Regional Trial Court (RTC) of Cebu. On January 26, 2004, the RTC rendered judgment finding
Aurora liable and ordering her to pay moral damages, attorney’s fees, litigation expenses and costs.
Aurora’s former counsel of record, Atty. Jude Henritz R. Ycong, belatedly discovered about
this adverse judgment when he received from Elmer Sunbanun et al.’s counsel a Motion to Direct
Issuance of Entry of Judgment and Writ of Execution on March 16, 2004. It turned out that although
he had already previously informed the court of his new office address, the court mistakenly sent the
January 26, 2004 Decision to his former office address. He raised this in his opposition to the motion
filed by Elmer Sunbanun et al. Finding this point meritorious, the court denied Elmer Sunbanun et
al.’s motion, ruling that the judgment against Aurora has not yet attained finality as the 15-day period
to appeal, counted from March 16, 2004, has not yet lapsed.
Aurora filed her Motion for Reconsideration on March 31, 2004, the last day to file her
appeal. The court in its April 27, 2004 Order denied said motion. Atty. Ycong received the notice of
denial on May 6, 2004, thus giving his client a day left to file her appeal. Explaining that Aurora has
been busy campaigning for the local elections as she was running for the position of town mayor in
Calubian, Leyte and that he and his client have yet to discuss the pros and cons of appealing the case,
Atty. Ycong sought for the relaxation of the procedural rules by filing an extension of 15 days to file
Auroras notice of appeal. Atty. Ycong thereafter filed the Notice of Appeal on May 11, 2004.
ISSUES:
Whether or not the right to appeal is barred for being filed out of time.
RULING:
NO. In spite of Aurora’s error, the fresh period rule amendment as held in Neypes v. Court of
Appeals will be applied to her benefit. In Neypes, the Court held that a litigant is given another fresh
period of 15 days to perfect an appeal after receipt of the order of denial of his/her motion for
reconsideration/new trial before the RTC. Procedural laws may be given retroactive effect to actions
pending and undetermined at the time of their passage, there being no vested rights in the rules of
procedure. Neypes, which we rendered in September 2005, has been applied retroactively to a
number of cases wherein the original period to appeal had already lapsed subsequent to the denial
of the motion for reconsideration. Aurora’s situation is no exception, and thus she is entitled to
benefit from the amendment of the procedural rules.
The denial of Auroras Motion for Reconsideration of the trial courts January 26, 2004
decision was received by her former counsel on May 6, 2004. Sans her motion for extension to file a
notice of appeal, with the fresh period rule under Neypes, she still has until May 21, 2004 to file her
notice of appeal and thus, had timely filed her notice of appeal on May 11, 2004.
MARCELO G. GANADEN, et al. v. THE HONORABLE COURT OF APPEALS, et al.

G.R. Nos. 170500 & 170510-11, 1 JUNE 2011, THIRD DIVISION, (Villarama, JR., J.)
A respondent who is found administratively liable by the Office of the Ombudsman and is slapped
with a penalty of suspension of more than one month from service has the right to file an appeal with
the CA under Rule 43 of the 1997 Rules of Civil Procedure, as amended. But although a respondent is
given the right to appeal, the act of filing an appeal does not stay the execution of the decision of the
Office of the Ombudsman.
The Ombudsman found NPC’s Ganaden, Bautista and Narciso liable for dishonesty and
imposed upon them the penalty of dismissal. Aggrieved, Ganaden et al. filed separate petitions for
review before the CA. Meanwhile, Ganaden et al. availed of the early retirement program from the
NPC. At the time the Decision of dismissals of the Ombudsman came to their attention, they were
already employed at the National Transmission Commission (TRANSCO).
Hence, on September 19, 2005, the Office of the Ombudsman issued a

1st Indorsement referring to Alan T. Ortiz, President and Chief Executive Officer of TRANSCO. In the
1st Indorsement, the Office of the Ombudsman requested from TRANSCO the issuance of Orders for
Dismissal from the service of Ganaden, Bautista and Narciso.
In compliance with the aforesaid 1st Indorsement, Ortiz issued Orders of Dismissalagainst
Ganaden, Bautista, and Narciso. Aggrieved again, Ganaden et al. filed with the CA a verified petition to
cite Ortiz in contempt for issuing the orders of dismissal and suspension. Ganaden et al. claimed that
by virtue of their appeal to the CA the execution of the Decisions, by the Ombudsman, was
automatically stayed even without a restraining order. Thus, Ortiz’s issuance of orders of dismissal
was an outright violation of the authority of the CA amounting to contempt.
ISSUE:
Whether or not administrative decisions of the Office of the Ombudsman imposing the
penalties of dismissal are stayed pending appeal.
RULING:
NO. Section 7, Rule III of the Rules of Procedure of the Office of the Ombudsman, as amended
by Administrative Order No. 17, dated September 15, 2003, provides:
SECTION 7. Finality and Execution of Decision. Where the respondent is

absolved of the charge, and in case of conviction where the penalty imposed is public
censure or reprimand, suspension of not more than one month, or a fine equivalent to
one month salary, the decision shall be final, executory and unappealable. In all other
cases, the decision may be appealed to the Court of Appeals on a verified petition for
review under the requirements and conditions set forth in Rule 43 of the Rules of Court,
within fifteen (15) days from receipt of the written Notice of the Decision or Order
denying the Motion for Reconsideration.
An appeal shall not stop the decision from being executory. In case the penalty is suspension
or removal and the respondent wins such appeal, he shall be considered as having been under
preventive suspension and shall be paid the salary and such other emoluments that he did not receive
by reason of the suspension or removal.
THE ESTATE OF SOLEDAD MANINANG AND THE LAW FIRM OF QUISUMBING TORRES v. THE
HONORABLE COURT OF APPEALS, et al.
Grave abuse of discretion implies a capricious and whimsical exercise of judgment that is
equivalent to lack of jurisdiction, or where the power is exercised in an arbitrary or despotic manner by
reason of passion, prejudice or personal aversion amounting to an evasion of positive duty or to a virtual
refusal to perform the duty enjoined, or to act at all in contemplation of law.
Clemencia Aseneta (Clemencia), through Bernardo Aseneta (Bernardo), filed a reconveyance

case (Reconveyance Case) involving a Diliman property and a Cubao property against Spouses
Salvacion and Agustin Ladanga (Spouses Ladanga). During the pendency of the Reconveyance case,
Clemencia died. She was substituted by Bernardo. Probate proceedings of Clemencia’s estate
(Probate Case) took place between Soledad Maninang (Maninang), represented by Law Firm of
Quisumbing Torres (QT), and Bernardo. The Probate Case was eventually decided based on a
compromise agreement executed by Bernardo, Maninang, and their respective counsels. While the
Probate Case was still pending, the parties to the Reconveyance Case Bernardo and spouses Ladanga
allegedly entered into a Compromise Agreement with respect to the Cubao property. The
Reconveyance Case then proceeded and was decided in favor of Clemencia’s estate. The trial court
ordered the reconveyance of both the Diliman property and the Cubao property to Bernardo for and
in behalf of Clemencia.
Spouses Ladanga appealed the adverse decision in the Reconveyance Case to the Court of
Appeals (CA). Estate of Soledad Maninang (Estate of Maninang) and QT then joined Bernardo as
appellees in the Reconveyance Case by filing a Motion for Joinder of Additional Parties. Without
acting on the Motion for Joinder of Additional Parties, the CA affirmed the trial court’s decision with
respect to the Diliman property. The Supreme Court (SC) affirmed the CA Decision with respect to
the Diliman property, which decision eventually attained finality (G.R. No. 145874).
Meanwhile, the Estate of Maninang and QT filed a Motion for Partial Reconsideration of the
CA Decision affirming the trial court’s decision with respect to the Diliman property. They prayed
for the nullification of the compromise agreement executed by Bernardo and Spouses Ladanga over
the Cubao property; or, in the alternative, they sought a declaration that no such compromise
agreement actually existed between Bernardo and Spouses Ladanga. The CA refused to act on the
said motion because of the then pending appeal of the CA Decision in the SC. Hence, the instant
petition.
ISSUE:
Whether or not the Estate of Maninang and QT have a right to adjudicate their claims to the
Cubao property in the appeal in the Reconveyance Case, such that the CA gravely abused its discretion
in denying them the opportunity to participate therein.
RULING:
NO. Petitioners claim that they have an interest in the properties of Clemencia’s estate by
virtue of the decision in the Probate Case which gave them a certain share in those properties. They
thus seek to join the appeal in the Reconveyance Case so that the Cubaoproperty would be
adjudicated to Clemencia’s estate. But the said motion is moot because the Cubao property had
already been adjudicated in favor of Clemencia’s estate with finality by the trial court in the
Reconveyance Case. The trial court’s February 24, 1995 Decision ordered the spouses Ladanga to
reconvey the Cubao property to Clemencia’s estate, and this was not appealed. What was appealed
to the CA (in CA-G.R. CV No. 51242) was the order to reconvey the Diliman property. That the appeal
in the Reconveyance Case (CA-G.R. CV No. 51242) only involved the Diliman property was finally
determined by the Court in G.R. No. 145874. In short, there is no need for petitioners to join the
appeal in the Reconveyance Case because: first, such appeal covered the Diliman property and not
the Cubao property; and second, as to the Cubao property, it has already been settled with finality
that such property must be reconveyed by the spouses Ladanga to Clemencias estate.
Based on the foregoing, the CA did not gravely abuse its discretion when it did not allow
petitioners to join and participate in the appeal in the Reconveyance Case. Grave abuse of discretion
implies a capricious and whimsical exercise of judgment that is equivalent to lack of jurisdiction, or
where the power is exercised in an arbitrary or despotic manner by reason of passion, prejudice or
personal aversion amounting to an evasion of positive duty or to a virtual refusal to perform the duty
enjoined, or to act at all in contemplation of law. In the case at bar, while the CA’s actions may not
have been ideal (it should have simply denied petitioners’ motions instead of refraining from acting
on them), the same did not amount to a grave abuse of discretion considering that the issues raised
by petitioners were not related to the subject matter before the CA. The petitioners’ interest is in the
Cubao property, while the subject of the appeal before the CA was the Diliman property.
HEIRS OF RODOLFO CRISOSTOMO (EUPROCINIA, ROYCE and IRISH CRISOSTOMO) v. RUDEX

INTERNATIONAL DEVELOPMENT CORPORATION
GR No. 176129, 24 August 2011, FIRST DIVISION, (Leonardo-De Castro, J)
Where no element of intent to delay the administration of justice could be attributed to

petitioners, a one-day delay does not justify their petitions dismissal.
On December 17, 2001, Rodolfo and Euprocinia Crisostomo were bought a house and lot at a
subdivision developed by the Rudex International Development Corporation (Rudex). When the
spouses moved in to their new house, they started to notice several construction defects on the house
and inadequate facilities in the subdivision. Rodolfo asked his wife Euprocinia to discontinue paying
their monthly amortizations and to ask for a rescission of the contract.
Rodolfo filed a Complaint[ for violation of Presidential Decree Nos. 1344 and 957, and Board
Resolution No. 579 of 1995, before the Housing and Land Use Regulatory Board. The HLURB issued
a judgment by default declaring the rescission of the contract to sell. On a review, the HLURB ordered
spouses Crisostomo to turn over possession of the unit to Rudex and ordering spouses Crisostomo to
pay respondent reasonable compensation for the use of the unit. The heirs of Rodolfo filed an appeal
to the Office of President which upheld the rescission of the contract.
ISSUE:
Whether or not the Court of Appeals erred in dismissing the petition for review filed by the
Heirs of Rodolfo before it, on the ground that the petition was filed late.
RULING:
YES. The purpose in limiting the period of appeal is to forestall or avoid an unreasonable
delay in the administration of justice and to put an end to controversies. Where no element of intent
to delay the administration of justice could be attributed to petitioners, a one-day delay does not
justify their petitions dismissal.
In this case, the last day for filing the petition for review was on September 13, 2006. The
petitioners entrusted the drafting of their petition with their counsel, who in turn entrusted the
attaching of the required annexes to the petition with her secretary. The secretary resigned from her
job sometime later to avoid giving her employer problems for unexpected absences in the future.
Aside from this, the petitioners also submitted an Affidavit from the secretary, who narrated her
ordeal that day and why she was not able to inform her employer of the whereabouts of the
petition. A certification from the doctor of one of the secretary’s children was also submitted to prove
that the secretary indeed brought her children to the doctor on September 14, 2006, the deadline for
filing the petition for review with the Court of Appeals.
D. M. WENCESLAO AND ASSOCIATES, INC. v. CITY OF PARANAQUE, et al.

G.R. No. 170728, 31 August 2011, FIRST DIVISION (Villarama, J.)
The payment of appellate docket fees is not a mere technicality of law or procedure. It is an
essential requirement, without which the decision or final order appealed from becomes final and
executory as if no appeal was filed.
D.M. Wenceslao and Associates, Inc. (D.M. Wenceslao) is a domestic corporation engaged in
the construction business. It is the registered owner of more than 200,000 square meters of
reclaimed land in Barangay Tambo, Paraaque City, now known as the Aseana Business Park.In 1996,
the City of Paranaque passed Ordinance No. 96-16, providing for the market values of the properties
within its jurisdiction as basis for assessment and real property taxation. The ordinance also
provided for a discount of 70% of the base value of the developed lots in the area, for low, sunken
and undeveloped parcels of land, such as the lots reclaimed and owned by D.M. Wenceslao.
The City Assessor of Paranaque, however, assessed D.M. Wenceslao’s lots based on the rates
applicable to Barangay Baclaran, which rates were higher than those applicable to properties in
Barangay Tambo. D.M. Wenceslao informed the City Assessor of the wrongful assessment in 1998;
hence, starting on the 3rd quarter of 1998, the Tambo rates were used, although D.M. Wenceslao
claimed that the discount provision in the ordinance was still not applied. Subsequently, the City
Treasurer declared D.M. Wenceslao’s properties delinquent and included them in the auction sale.
This prompted D.M. Wenceslao to file with the Regional Trial Court (RTC) a Complaint for collection
of excess real property taxes and damages with prayer for the issuance of a temporary restraining
order and/or preliminary injunction seeking to restrain respondents from enforcing the foreclosure
sale. The RTC denied the prayer for the issuance of a writ of preliminary injunction. Thus, to prevent
its properties from being auctioned, D.M. Wenceslao paid under protest the amount real property
taxes.
The RTC issued an Order granting the motion to dismiss. On appeal to the CA, it dismissed D.M.
Wenceslao’s appeal for its failure to pay the required docketing fees. The CA denied the Motion for
Reconsideration.
ISSUE
Whether the CA erred in dismissing petitioners appeal for late payment of docket fees.
RULING
NO. The rule that appellate court docket and other lawful fees must be paid within the period
for taking an appeal is stated in Section 4, Rule 41 of the 1997 Rules of Civil Procedure.
In this case, D.M. Wenceslao received a copy of the trial court's Order on May 14, 2004. Thus,
pursuant to Section 3, Rule 41, in relation to Section 1, Rule 22, it had until May 31, 2004 within which
to perfect its appeal by filing within that period the notice of appeal and paying the appellate docket
and other legal fees. On May 17, 2004, petitioner filed its notice of appeal within the reglementary
period. It must be noted, however, that it paid the required docket fees only on October 20, 2004, or
late by almost five months.
It bears stressing that payment of docket and other fees within this period is mandatory for
the perfection of the appeal. Otherwise, the right to appeal is lost. This is so because a court acquires
jurisdiction over the subject matter of the action only upon the payment of the correct amount of docket
fees regardless of the actual date of filing of the case in court. The payment of appellate docket fees is
not a mere technicality of law or procedure. It is an essential requirement, without which the decision
or final order appealed from becomes final and executory as if no appeal was filed.
Provisional Remedies
ADVENT CAPITAL AND FINANCE CORPORATION v. ROLAND YOUNG

G.R. No. 183018, 3 August 2011, SECOND DIVISION, (Carpio, J)
The dismissal of the replevin case for failure to prosecute results in the restoration of the parties’
status prior to litigation, as if no complaint was filed at all. Claims for damages on account of improper
or irregular seizure in replevin cases should be filed in the same case that is the main action, and with
the court having jurisdiction over the case at the time of the application.
Advent Capital and Finance Corporation (Advent) filed for corporate rehabilitation with the
Regional Trial Court (RTC). On 27 August 2001, the rehabilitation court issued a Stay Order which
states that the enforcement of all claims whether for money or otherwise, and whether such
enforcement is by court action or otherwise, against Advent, its guarantors and sureties
not solidarily liable with it, is stayed. The rehabilitation court approved the rehabilitation plan
submitted by Advent. Included in the inventory of Advents assets was the subject 1996 Mercedes
Benz E230 which remained in Roland Young’s (Young) possession at the time.
Young’s obstinate refusal to return the subject car, after repeated demands, prompted Advent
to file the replevin case. After Advent’s posting of P3,000,000 replevin bond, which was double the
value of the subject car at the time the trial court issued a Writ of Seizure directing the Sheriff to seize
the subject car from Young. Upon receipt of the Writ of Seizure, Young turned over the car to Advent,
which delivered the same to the rehabilitation receiver. On 28 April 2005, the trial court issued an
Order dismissing the replevin case without prejudice for Advent’s failure to prosecute.
On 8 July 2005, Young filed an omnibus motion, praying that Advent return the subject car
and pay him P1.2 million in damages for the improper and irregular seizure of the subject car, to be
charged against the replevin bond. The trial court denied this motion. Young filed a petition for
certiorari and mandamus with the Court of Appeals (CA) seeking to annul the trial courts Orders. The
CA ruled in favor of Young and annulled the assailed rulings of the trial court.
ISSUES:
1. Whether or not the CA committed reversible error in directing the return of the seized car
to Young.
2. Whether or not the CA erred in ordering the trial court to set a hearing for the
determination of damages against the replevin bond.
RULING:
1. NO. The CA is correct in ordering the return of the seized car to Young since this is the
necessary consequence of the dismissal of the replevin case for failure to prosecute without
prejudice. Upon the dismissal of the replevin case for failure to prosecute, the writ of seizure, which
is merely ancillary in nature, became functus officio and should have been lifted. There was no
adjudication on the merits, which means that there was no determination of the issue who has the
better right to possess the subject car. Advent cannot therefore retain possession of the subject car
considering that it was not adjudged as the prevailing party entitled to the remedy of replevin.
The dismissal of the replevin case for failure to prosecute results in the restoration of the
parties status prior to litigation, as if no complaint was filed at all. To let the writ of seizure stand
after the dismissal of the complaint would be adjudging Advent as the prevailing party, when
precisely no decision on the merits had been rendered. Accordingly, the parties must be reverted to
their status quo ante. Since Young possessed the subject car before the filing of the replevin case, the
same must be returned to him, as if no complaint was filed at all.
2. YES. Section 10, Rule 60 of the Rules of Court governs claims for damages on account of
improper or irregular seizure in replevin cases. It provides that in replevin cases, as in receivership
and injunction cases, the damages to be awarded upon the bond shall be claimed, ascertained, and
granted in accordance with Section 20 of Rule 57. The provision essentially allows the application to
be filed at any time before the judgment becomes executory. It should be filed in the same case that
is the main action,and with the court having jurisdiction over the case at the time of the application.In
this case, there was no application for damages against Stronghold resulting from the issuance of the
writ of seizure before the finality of the dismissal of the complaint for failure to prosecute. It appears
that Young filed his omnibus motion claiming damages against Stronghold after the dismissal order
issued by the trial court dismissing the replevin suit. Young is barred from claiming damages against
the replevin bond.
THUNDER SECURITY AND INVESTIGATION AGENCY/LOURDES M. LASALA v. NATIONAL FOOD

AUTHORITY (REGION I) and NFA REGIONAL BIDS AND AWARDS COMMITTEE (REGION I)
G.R. No. 182042, 27 July 2011, FIRST DIVISION (Villarama, Jr., J.)
It bears stressing that an injunction is not a remedy to protect or enforce contingent, abstract,
or future rights; it will not issue to protect a right not in esse and which may never arise, or to restrain
an act which does not give rise to a cause of action. There must exist an actual right.
Thunder Security and Investigation Agency (Thunder Security) entered into a Contract for
Services with National Food Authority (NFA) Region 1. Subsequently, the law governing the bidding
procedure for service contracts in the government was repealed. Since Thunder Security’s contract
with NFA was about to expire, NFA invited bidders. Thunder Security paid a bidding fee to participate
in the bidding process. However, their bid was rejected due to its failure to submit the required
documents under the new law governing the bidding. Thunder Security protested and contended
that until the implementing rules and regulations of can be promulgated, no bidding shall take place.
Notwithstanding, NFA rejected Thunder Security’s application. Thunder Security filed before
the Regional Trial Court (RTC) a Petition for Prohibition and Preliminary Injunction, with a prayer
for the issuance of a Temporary Restraining Order (TRO) plus Damages, seeking, among others, to
enjoin respondents from awarding the contract to another security agency. The RTC issued a TRO
against respondents. Correlatively, in its Order dated August 27, 2003, the RTC granted the writ of
preliminary injunction in favor of petitioner and directed respondents to desist from terminating
petitioners services until further orders from the RTC.
ISSUE:
Whether or not the CA erred in setting aside the RTC orders which granted injunctive relief
to Thunder security.
RULING:
NO. For the writ to issue, two requisites must be present, namely, the existence of the right
to be protected, and that the facts against which the injunction is to be directed are violative of said
right. It is necessary that one must show an unquestionable right over the premises.
In this case, it is apparent that when the RTC issued its December 1, 2005 Order, Thunder
Security has no more legal rights under the service contract which already expired on September 15,
2003. Therefore, it has not met the first vital requisite that it must have material and substantial
rights that have to be protected by the courts. It bears stressing that an injunction is not a remedy to
protect or enforce contingent, abstract, or future rights; it will not issue to protect a right not in esse
and which may never arise, or to restrain an act which does not give rise to a cause of action. There
must exist an actual right. Verily, petitioner cannot lay claim to an actual, clear and positive right
based on an expired service contract.
Moreover, well-entrenched in this jurisdiction is that no court can compel a party to agree to
a contract through the instrumentality of a writ of preliminary injunction. A contract can be renewed,
revived or extended only by mutual consent of the parties. By issuing the assailed orders most
particularly its December 1, 2005 Order, the RTC in effect extended the life of the parties expired
contract in clear contravention of our earlier pronouncements.
SPS. GONZALO T. DELA ROSA & CRISTETA DELA ROSA v. HEIRS OF JUAN VALDEZ and
SPOUSES POTENCIANO MALVAR AND LOURDES MALVAR
A preliminary mandatory injunction is more cautiously regarded than a mere prohibitive

injunction since, more than its function of preserving the status quo between the parties, it also
commands the performance of an act. Accordingly, the issuance of a writ of preliminary mandatory
injunction is justified only in a clear case, free from doubt or dispute. When the complainant's right is
doubtful or disputed, he does not have a clear legal right and, therefore, the issuance of a writ of
preliminary mandatory injunction is improper. While it is not required that the right claimed by
applicant, as basis for seeking injunctive relief, be conclusively established, it is still necessary to show,
at least tentatively, that the right exists and is not vitiated by any substantial challenge or contradiction.
The instant Petition traces its roots to a Complaint for Quieting of Title and Declaration of
Nullity of Transfer Certificates of Title involving the subject property, filed before the RTC by Manila
Construction Development Corporation of the Philippines (MCDC), against Gonzalo and Cristetadela
Rosa (spouses Dela Rosa) and Juan, Jose, Pedro and Maria, all surnamed De la Cruz, docketed as Civil
Case No. 00-6015. Complaints-in-intervention were filed in the said case by (1) North East Property
Ventures, Inc. (NEPVI), and (2) spouses Valdez and spouses Malvar. The spouses Malvar were the
grantees/assignees under a Deed of Absolute Transfer/Conveyance over the subject property
executed by the spouses Dela Rosa on September 6, 2001. Noticeably, MCDC; Intervenor North East
Property Ventures, Inc. and Intervenor Valdez spouses and Malvar spouses under separate
applications have commonly prayed for the relief of mandatory injunction; although plaintiff MCDC
initially sought for the relief of preventive injunction; however, all the prayers for reliefs of
mandatory injunction have conjoined against defendants dela Rosa spouses and the other occupants
of Lot 4, the land in controversy.
The Regional Trial Court (RTC) granted the joint prayer for the issuance of a writ of
preliminary mandatory injunction of the spouses Valdez and spouses Malvar. The Court of Appeals
(CA) rendered its Decision dismissing the Sps. Dela Rosa’s Petition for Certiorari and, thus, upholding
the RTC Orders dated December 16, 2002 and February 28, 2003. The appellate court agreed with
the RTC that there are ample justifications for the issuance of the writ of preliminary mandatory
injunction in favor of the spouses Valdez and spouses Malvar.
Sps. Dela Rosa sought the issuance of a temporary restraining order (TRO) and/or writ of
preliminary injunction before the Supreme Court. The Court issued a TRO enjoining the Court of
Appeals, the RTC, and the spouses Valdez and spouses Malvar, and their agents, representatives, and
anyone acting on their behalf, from implementing and enforcing the Decision dated June 10, 2003
and Resolution dated July 24, 2003 of the Court of Appeals in CA-G.R. SP No. 76081. Sps. Valdez and
Sps. Malvar filed several motions to lift the TRO, but these were all denied by the Court, hence, the
TRO remained effective and binding.
ISSUE:
Whether or not the court erred in issuing a writ of preliminary mandatory injunction, which
placed the spouses Valdez and spouses Malvar in possession of the subject property during the
pendency of Civil Case No. 00-6015.
RULING:
NO. A preliminary mandatory injunction is more cautiously regarded than a mere prohibitive
injunction since, more than its function of preserving the status quo between the parties, it also
commands the performance of an act. Accordingly, the issuance of a writ of preliminary mandatory
injunction is justified only in a clear case, free from doubt or dispute. When the complainant's right
is doubtful or disputed, he does not have a clear legal right and, therefore, the issuance of a writ of
preliminary mandatory injunction is improper. While it is not required that the right claimed by
applicant, as basis for seeking injunctive relief, be conclusively established, it is still necessary to
show, at least tentatively, that the right exists and is not vitiated by any substantial challenge or
contradiction.
Sine dubio, the grant or denial of a writ of preliminary injunction in a pending case, rests on
the sound discretion of the court taking cognizance of the case since the assessment and evaluation
of evidence towards that end involve findings of facts left to the said court for its conclusive
determination. Hence, the exercise of judicial discretion by a court in injunctive matters must not be
interfered with except when there is grave abuse of discretion. Grave abuse of discretion in the
issuance of writs of preliminary injunction implies a capricious and whimsical exercise of judgment
that is equivalent to lack of jurisdiction, or where the power is exercised in an arbitrary or despotic
manner by reason of passion, prejudice or personal aversion amounting to an evasion of positive
duty or to a virtual refusal to perform the duty enjoined, or to act at all in contemplation of law.
In the instant Petition, the Court finds that the RTC did not commit grave abuse of discretion
in issuing the writ of preliminary mandatory injunction in favor of the spouses Valdez and spouses
Malvar. Consequently, the Court of Appeals did not commit any reversible error in dismissing the
spouses Dela Rosas Petition for Certiorari.
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT (PCGG) v. SANDIGANBAYAN (Second

COMMERCIAL BANKING CORPORATION (RCBC)
Before a writ of preliminary injunction may be issued, there must be a clear showing that there
exists a right to be protected and that the acts against which the writ is to be directed are violative of
established right.
By virtue of Presidential Decree (P.D.) No. 1193, as amended by P.D. No. 1394, then President
Ferdinand E. Marcos authorized Tourist Duty Free Shops, Inc. (TDFSI) to establish, operate and
maintain duty and tax free stores at all international airports and seaports, as well as at selected
hotels, tourist resorts, and commercial or trading centers throughout the country. PCGG issued to
TDFSI a Sequestration Order and a subsequent a Freeze Order directing the Manager of RCBC to
freeze any withdrawals, transfers or remittances from the funds of TDFSI in the said bank. As a
countermeasure, TDFSI filed before the Court a Petition for Certiorari, Prohibition and Injunction
with Preliminary Injunction and/or Restraining Order to annul and stop the enforcement of the
Sequestration Order. In that case, the Court ruled in favor of PCGG without prejudice to the filing of a
case before the Sandiganbayan. The resolution had become final and executory.
Meanwhile, TDFSI filed a Complaint for Injunction and Specific Performance with Prayer for
Issuance of Restraining Order and/or Preliminary Mandatory and Prohibitory Injunction against the
PCGG, Bank of America (BA) and RCBC before the Sandiganbayan which was dismissed. When
elevated to the Court, the latter reversed and set it aside. Consequently, the case was remanded for
further proceedings. The Sandiganbayan issued the first assailed Resolution granting TDFSIs motion
for the issuance of a writ of preliminary mandatory and prohibitory injunction. While recognizing the
PCGGs authority to issue the Sequestration Order to carry out its vital task of recovering justly and
expeditiously ill-gotten wealth, the Sandiganbayan found that the continued implementation of said
Order would greatly cause irreparable damage to TDFSI.
Aggrieved, the PCGG filed an Urgent Motion to Recall the Writ and a Motion for
Reconsideration. The Sandiganbayan then ordered to hold in abeyance the resolution of the motions
named in the preceding paragraph and other related incidents. In the same resolution, the court
suspended the implementation of the writ. On January 23, 2002, the Sandiganbayan later denied
PCGG’s motion for reconsideration. On even date, the Sandiganbayanset the case for pre-trial, and for
trial. Hence, this petition for certiorari.
ISSUE:
Whether or not the Sandiganbayan erred in issuing the writ of preliminary mandatory and
prohibitory injunction against the implementation of the Sequestration Order of the PCGG directed
against TDFSI.
RULING:
YES. The Court held that the Sandiganbayan gravely abused its discretion amounting to lack
or excess of jurisdiction in issuing the questioned preliminary injunctive writ. The grounds relied
upon by the Sandiganbayan are not sufficient to warrant the issuance of said writ. The documentary
evidence listed above merely show that TDFSI is a corporation, that a sequestration order signed by
a PCGG Commissioner was issued against it, and that no action for recovery of ill-gotten wealth was
filed by PCGG against TDFSI at the time the inquiry was made.
Under Section 3, Rule 58 of the Rules of Court, it can be inferred that two (2) requisites must
exist to warrant the issuance of an injunctive relief, namely: (1) the existence of a clear and
unmistakable right that must be protected; and (2) an urgent and paramount necessity for the writ
to prevent serious damage. Without making a definitive conclusion as to the validity of the
Sequestration and Freeze Orders, the Court concluded that the pieces of evidence enumerated above
do not, in any way, show that TDFSI has a right to be protected and that the implementation of the
Sequestration and Freeze Orders is violative of its rights.
Pending the determination of whether or not the subject properties are ill-gotten, there is an
obvious and imperative need for preliminary, provisional measures to prevent concealment,
disappearance, destruction, dissipation, or loss of the assets and properties subject of the suits, or to
restrain or foil acts that may render moot and academic, or effectively hamper, delay or negate efforts
to recover the same. The implementation of these orders should, therefore, not be restrained unless
there is a clear ground to do so. More so in this case, considering that the Sandiganbayan’s
conclusions are contrary to established jurisprudence.
SPOUSES ISAGANI AND DIOSDADO CASTRO v. SPOUSES REGINO SE ANDVIOLETA DELA CRUZ,
et al.
G.R. No. 190122, 10 January 2011, THIRD DIVISION (Carpio Morales, J.)
The issuance of the writ of preliminary mandatory injunction depends on the sound judicial
discretion of the trial court which must not be interfered with except when there is manifest abuse.
Spouses Eduardo and Charito Perez (Spouses Perez) obtained a P250,000 loan from Spouses
Isagani and Diosdada Castro (Spouses Castro), to secure which they executed a real estate mortgage
covering an unregistered parcel of land. Spouses Perez having failed to settle their loan, Spouses
Castro extrajudicially foreclosed the mortgage and, as the highest bidder at the public auction, bought
the property. It turned out that before the foreclosure, Spouses Perez, contrary to a provision of the
real estate mortgage, sold the property to Spouses Regino Se and Violeta dela Cruz (Spouses dela
Cruz). Spouses Castro thus filed a complaint against Spouses Perez and Spouses dela Cruz, for
annulment of Deed of Sale and Tax Declaration (TD) and damages before the Regional Trial Court
(RTC).
During the pendency of Spouses Castro’s complaint against Spouses Perez and Spouses dela
Cruz, they filed an ex-parte motion before the RTC for the issuance of a writ of possession over the
property by virtue of the foreclosure of the mortgage of the sale to them of the property. Spouses
Castro’s motion was granted and a writ of possession dated was issued and enforced against Spouses
dela Cruz who were evicted from the property. Spouses dela Cruz then prayed for the issuance of a
writ of preliminary mandatory injunction to restore them to physical possession of the property,
which prayer the RTC granted. Spouses Castro’s motion for reconsideration was denied, hence, they
filed a petition for certiorari before the Court of Appeals. Finding no grave abuse of discretion in the
issuance of the Order, the appellate court denied the petition.
ISSUE:
Whether the issuance of the writ of preliminary mandatory injunction proper.
RULING:
YES. For an injunctive writ to issue, a clear showing of extreme urgency to prevent
irreparable injury and a clear and unmistakable right to it must be proven by the party seeking it.
The primary objective of a preliminary injunction, whether prohibitory or mandatory, is to preserve
the status quo until the merits of the case can be heard. Indeed, the rule is well-entrenched that for
grave abuse of discretion to exist as a valid ground for the nullification of an injunctive writ, there
must be a capricious and whimsical exercise of judgment, equivalent to lack or excess of
jurisdiction. Or the power must be exercised in an arbitrary manner by reason of passion or personal
hostility, and it must be patent and gross as to amount to an evasion of a positive duty or a virtual
refusal to perform a duty enjoined by law.
Recall that respondent Spouses dela Cruz had long before the foreclosure of the mortgage or
sometime in 1997 bought and took possession of the property, and had in fact cancelled the seller-
respondent Spouses Perez TD and had one issued in their name. By petitioners seeking ex parte the
issuance to them on February 1999 of a writ of possession over the property, which was granted and
the writ enforced against respondent Spouses de la Cruz, they disturbed the status quo ante
litem. The trial court did not thus commit grave abuse of discretion when it issued the writ of
preliminary mandatory injunction in favor of Spouses de la Cruz.
For the enforcement of the writ of possession against respondent Spouses dela Cruz, who did
not take part in the foreclosure proceedings, would amount to taking of real property without the
benefit of a proper judicial intervention. The procedural shortcut with petitioners is
impermissible. Even Article 433 of the Civil Code instructs that Actual possession under claim of
ownership raises disputable presumption of ownership. The true owner must resort to judicial
process for the recovery of the property. The contemplated judicial process is not through an ex-
parte petition as what petitioners availed of, but a process wherein a third party, Spouses de la Cruz
herein, is given an opportunity to be heard.
MILAGROS SALTING v. JOHN VELEZ and CLARISSA R. VELEZ

Injunction is not a remedy to protect or enforce contingent, abstract, or future rights—it will
not issue to protect a right not in esse and which may never arise, or to restrain an act which does not
give rise to a cause of action.
John Velez and Clarissa Velez (Velezes) filed a complaint for ejectment against Milagros
Salting (Salting) involving a property covered by TCT No. 38079. The Velezes obtained a favorable
decision and ordered Salting to vacate the subject parcel of land. The decision became final and
executory, after which the Velezes filed a motion for execution which was opposed by Salting. Salting
prayed that a TRO be issued, restraining Velezes and all persons acting for and in their behalf from
executing the MeTC decision. She further sought the declaration of nullity of the sale by the heirs of
Villamena to Velezes involving the subject parcel of land, and, consequently, the cancellation of the
title to the property in Velezes’ name. The Regional Trial Court (RTC) granted the writ of preliminary
injunction applied for. The Court of Appeals (CA) set aside the RTC Decision finding grave abuse of
discretion in on the part of the RTC in issuing writ of preliminary injunction. It concluded that the
Velezes had no clear and unmistakable right to possession over the subject parcel of land hence, the
Velezes were not entitled to the writ of preliminary injunction.
ISSUE:
Whether Salting is entitled to the issuance of a writ of preliminary injunction.
RULING:
NO. Section 3, Rule 58 of the Rules of Court enumerates the grounds for the issuance of
preliminary injunction. And as clearly explained in Ocampo v. Sison Vda. de Fernandez,
To be entitled to the injunctive writ, the applicant must show that there exists
a right to be protected which is directly threatened by an act sought to be enjoined.
Furthermore, there must be a showing that the invasion of the right is material and
substantial and that there is an urgent and paramount necessity for the writ to
prevent serious damage. The applicant’s right must be clear and unmistakable. In the
absence of a clear legal right, the issuance of the writ constitutes grave abuse of
discretion. Where the applicant’s right or title is doubtful or disputed, injunction is
not proper. The possibility of irreparable damage without proof of an actual existing
right is not a ground for injunction.
A clear and positive right especially calling for judicial protection must be
shown. Injunction is not a remedy to protect or enforce contingent, abstract, or future
rights; it will not issue to protect a right not in esse and which may never arise, or to
restrain an act which does not give rise to a cause of action. There must exist an actual
right. There must be a patent showing by the applicant that there exists a right to be
protected and that the acts against which the writ is to be directed are violative of
said right.
In this case, the enforcement of the writ of execution which would evict Salting from her
residence is manifestly prejudicial to her interest. However, she possesses no legal right that merits
the protection of the courts through the writ of preliminary injunction. Her right to possess the
property in question has been declared inferior or inexistent in relation to respondents in the
ejectment case in the MeTC decision which has become final and executory.
HON. EDUARDO ERMITA v. HON. JENNY LIND R. ALDECOA-DELORINO, et al.
G.R. No. 177130, 7 June 2011, EN BANC, (Carpio Morales, J.)
To be entitled to a preliminary injunction to enjoin the enforcement of a law assailed to be

unconstitutional, the party must establish that it will suffer irreparable harm in the absence of injunctive
relief and must demonstrate that it is likely to succeed on the merits, or that there are sufficiently serious
questions going to the merits and the balance of hardships tips decidedly in its favor.
Executive Order No. 486 was issued on January 12, 2006 by then President Gloria Macapagal-
Arroyo. The Executive issuance in effect reduces protective tariff rates from 10% to 5% on the entry
of inexpensive products, particularly plastic food packaging, from ASEAN Free Trade (AFTA) member
countries into the Philippines.
Association of Petrochemical Manufacturers of the Philippines (APMP), an organization

composed of manufacturers of petrochemical and resin products, opposed the implementation of
E.O. 486. Contending that the E.O. would affect local manufacturers, it filed a petition before the RTC
of Makati, seeking the declaration of its unconstitutionality for being violative of Sec. 4 of Republic
Act No. 6647 which prohibits the President from increasing or reducing taxes while Congress is in
session and Sec. 402(e) of the Tariff and Customs Code. It thereupon prayed for the issuance of a writ
of preliminary injunction to enjoin its implementation.
Judge Jenny Lind R. Aldecoa Delorino, then Presiding Judge of the Regional Trial Court of
Makati City, Branch 137, by Omnibus Order granted in favor of APMP writ of preliminary injunction,
and enjoined the government from implementing Executive Order No. 486. Consequently, Hon.
Ermita contends that Judge Delorino gravely abused her discretion in assuming jurisdiction over the
petition for prohibition and granting the writ of preliminary injunction as the exercise of the quasi-
legislative functions of the President cannot be enjoined. He avers that writs of prohibition lie only
against those persons exercising judicial, quasi-judicial or ministerial functions. Further, Ermita
contends that the grant of injunctive relief was not supported by fact and law, for what APMP sought
to be protected was future economic benefits which may be affected by the implementation of the
E.O. benefits which its members have no right to since protective tariff rates are government
privileges wherein no one can claim any vested right to.
ISSUES:
1. Whether or not Judge Delorino erred in assuming jurisdiction over the petition for
prohibition and not granting Ermita’s motion to dismiss the petition;
2. Whether or not Judge Delorino erred in granting the writ of preliminary injunction in favor
of APMP.
RULING:
1. NO. Although, Prohibition lies against judicial or ministerial functions, but not against
legislative or quasi-legislative functions. Be that as it may, a perusal of the petition of APMP before
the trial court readily shows that it is not a mere petition for prohibition with application for the
issuance of a writ of preliminary injunction. For it is also one for certiorari as it specifically alleges
that E.O. 486 is invalid for being unconstitutional. Petitions for certiorari and prohibition are
appropriate remedies to raise constitutional issues and to review and/or prohibit or nullify, when
proper, acts of legislative and executive officials. Thus, even if the petition was denominated as one
for prohibition, Judge Delorino did not err in treating it also as one for certiorari and taking
cognizance of the controversy.
2. YES. It is well to emphasize that the grant or denial of a writ of preliminary injunction in a
pending case rests on the sound discretion of the court taking cognizance thereof. In the present case,
however, where it is the Government which is being enjoined from implementing an issuance which
enjoys the presumption of validity, such discretion must be exercised with utmost caution. It is thus
ineluctable that for it to be entitled to the writ, the APMP must show that it has a clear and
unmistakable right that is violated and that there is an urgent necessity for its issuance. That APMP
had cause of action and the standing to interpose the action for prohibition did not ipso facto call for
the grant of injunctive relief in its favor without it proving its entitlement thereto.
Contrary to Judge Delorino’s ruling, APMP failed to adduce any evidence to prove that it had
a clear and unmistakable right which was or would be violated by the enforcement of E.O. 486. The
filing of the petition at the court a quo was anchored on APMP and its member’s fear of loss or
reduction of their income once E.O. 486 is implemented and imported plastic and similar products
flood the domestic market due to reduced tariff rates. As correctly posited by Hon. Ermita, APMP was
seeking protection over future economic benefits which, at best, it had an inchoate right to. More
importantly, tariff protection is not a right, but a privilege granted by the government and, therefore,
APMP cannot claim redress for alleged violation thereof.
Special Civil Actions
HOME DEVELOPMENT MUTUAL FUND (HDMF) v. SPOUSES FIDEL AND FLORINDA SEE AND
SHERIFF MANUEL L. ARIMADO
G.R. No. 170292, 22 June 2011, THIRD DIVISION (Del Castillo, J.)
A party that loses its right to appeal by its own negligence cannot seek refuge in the remedy of
a writ of certiorari.
Spouses Fidel and Florinda See (Spouses See) were the highest bidder in the extrajudicial
foreclosure sale of a property that was mortgage to Home Development Mutual Fund (Pag-ibig).
Spouses See paid the bid price to Sheriff Manuel Arimado (Sheriff Arimado), who thereafter received
the certificate of sale.
After the expiration of the redemption period, Pag-ibig refused to surrender its certificate of
title to Spouses See because it had not yet received payment from Sheriff Arimado. Spouses See then
filed a complaint for specific performance with the damages against Pag-ibig. Both parties however
entered into a compromise agreement. Parties did not seek for motion for reconsideration.
Sheriff Arimado then failed to meet his undertaking to pay Pag-ibig. The trial court then
proceeded to rule on the issue of whether Pag-ibig is liable to release the title to Spouses See. The
Regional Trial Court (RTC) favored the Spouses See. The Court of Appeals (CA) affirmed the decision
of the lower court and denied the petition filed by Pag-ibig.
ISSUE:
Whether or not the CA erred in denying due course to HDMF’s petition for certiorari.
RULING:
NO. Certiorari is a limited form of review and is a remedy of last recourse. It is proper only
when appeal is not available to the aggrieved party. In the case at bar, the February 21, 2002 Decision
of the trial court was appealable under Rule 41 of the Rules of Court because it completely disposed
of respondent-spouses case against Pag-ibig. Pag-ibig does not explain why it did not resort to an
appeal and allowed the trial court’s decision to attain finality. In fact, the February 21, 2002 Decision
was already at the stage of execution when Pag-ibig belatedly resorted to a Rule 65 Petition for
Certiorari. Clearly, Pag-ibig lost its right to appeal and tried to remedy the situation by resorting to
certiorari. It is settled, however, that certiorari is not a substitute for a lost appeal, especially if the
parties own negligence or error in the choice of remedy occasioned such loss or lapse.
Moreover, even assuming arguendo that a Rule 65 certiorari could still be resorted to, Pag-
ibig’s petition would still have to be dismissed for having been filed beyond the reglementary period
of 60 days from notice of the denial of the motion for reconsideration. Pag-ibig admitted receiving
the trial courts Order denying its Motion for Reconsideration on March 22, 2002; it thus had until
May 21, 2002 to file its petition for certiorari. However, Pag-ibig filed its petition only on May 24,
2002, which was the 63rd day from its receipt of the trial courts order and obviously beyond the
reglementary 60-day period.
Pag-ibig stated that its petition for certiorari was filed within sixty (60) days from receipt
of the copy of the writ of execution by Pag-ibig on 07 May 2002, which writ sought to enforce the
Decision assailed in the petition This submission is beside the point. Rule 65, Section 4 is very clear
that the reglementary 60-day period is counted from notice of the judgment, order or resolution
being assailed, or from notice of the denial of the motion for reconsideration, and not from receipt of
the writ of execution which seeks to enforce the assailed judgment, order or resolution. The date of
Pag-ibig’s receipt of the copy of the writ of execution is therefore immaterial for purposes of
computing the timeliness of the filing of the petition for certiorari.
ERIC YU v. HONORABLE JUDGE AGNES REYES-CARPIO, in her official capacity as Presiding

Judge, Regional Trial Court of Pasig-Branch 261 and CAROLINE T. YU
An act of a court or tribunal can only be considered as with grave abuse of discretion when such
act is done in a capricious or whimsical exercise of judgment as is equivalent to lack of jurisdiction. The
abuse of discretion must be so patent and gross as to amount to an evasion of a positive duty or to a
virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, as where the
power is exercised in an arbitrary and despotic manner by reason of passion and hostility. Furthermore,
the use of a petition for certiorari is restricted only to truly extraordinary cases wherein the act of the
lower court or quasi-judicial body is wholly void
Eric Yu (Eric) filed a declaration of nullity of marriage against Caroline T. Yu (Caroline) before
the Regional Trial Court (RTC) in Pasig City. Judge Leili Cruz Suarez issued an order stating that
petition of Eric is already submitted for resolution. Geraldine moved to submit the incident on the
declaration of nullity of marriage for resolution of the court. However, Eric opposed the motion
claiming that the incident of the declaration of nullity of marriage cannot be resolved without the
presentation of evidence. Judge Suarez issued an order in favor of petitioner’s opposition. Geraldine
then filed and successfully moved for the inhibition of Judge Suarez. The case was then raffled to
Judge Agnes Reyes-Carpio (Judge Reyes-Carpio). Thereafter, Geraldine filed an omnibus motion
sought for the strict observance of the rule on the declaration of absolute nullity previously ruled by
Judge Suarez. Moreover, she asked that the incident on the declaration of nullity of marriage be
already submitted for resolution.
Judge Reyes-Carpio, granted the omnibus motion. She ratiocinated that the main action is the
declaration of nullity of marriage of the parties and the issues relating to property relations, custody,
and support are merely ancillary incidents. Eric moved for the reconsideration of the decision but it
was denied. Eric then filed a petition for certiorari under Rule 65 with the Court of Appeals (CA). The
CA dismissed the petition and affirmed the judgment trial court. Hence, the petition.
ISSUE:
Whether or not the CA committed grave abuse of discretion amounting to lack of jurisdiction
in holding that petition for certiorari is not a proper remedy of Yu.
RULING:
NO. A Petition for Certiorari under Rule 65 is the proper remedy in assailing that a judge has
committed grave abuse of discretion amounting to lack or excess of jurisdiction. The term grave
abuse of discretion has a specific meaning. An act of a court or tribunal can only be considered as
with grave abuse of discretion when such act is done in a capricious or whimsical exercise of
judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross
as to amount to an evasion of a positive duty or to a virtual refusal to perform a duty enjoined by law,
or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic
manner by reason of passion and hostility. Furthermore, the use of a petition for certiorari is
restricted only to truly extraordinary cases wherein the act of the lower court or quasi-judicial body
is wholly void. From the foregoing definition, it is clear that the special civil action of certiorari under
Rule 65 can only strike an act down for having been done with grave abuse of discretion if the
petitioner could manifestly show that such act was patent and gross. But this is not the case here.
Nowhere in the petition was it shown that the acts being alleged to have been exercised with
grave abuse of discretion (1) the Orders of the RTC deferring the presentation of evidence on custody,
support, and property relations; and (2) the appellate court’s Decision of upholding the Orders were
patent and gross that would warrant striking down through a petition for certiorari under Rule 65.
At the very least, Eric should prove and demonstrate that the RTC Orders and the CA Decision were
done in a capricious or whimsical exercise of judgment. This, however, has not been shown in the
petition.
MARIA LAARNI L. CAYETANO v. THE COMMISSION ON ELECTIONS AND DANTE O. TINGA

The Court can only review via certiorari a decision, order, or ruling of the COMELEC en banc in
accordance with Section 7, Article IX-A of the Constitution.
Dante O. Tinga (Tinga) and Maria Laarni Cayetano (Cayetano) were candidates for the
position of Mayor of Taguig City. Cayetano was proclaimed as the winner. Tinga then filed an election
protest against Cayetano before the Commission on Elections (COMELEC), alleging election frauds
and irregularities committed by Cayetano. The latter then filed a counter-protest, raised affirmative
defense of insufficiency in form and content of the election protest and she prayed for the dismissal
of the complaint.
COMELEC released a preliminary conference order, whereby, Cayetano protested by filing a

motion for reconsideration. However, COMELEC denied her motion. Thus, Cayetano filed a motion
for certiorari before the Supreme Court assailing that COMELEC committed grave abuse of discretion
when it released the preliminary conference order. Tinga refuted the allegations of Cayetano and
raised the procedural infirmity in the instant petition.
ISSUE:
Whether or not the Supreme Court can review the interlocutory order of the COMELEC.
RULING:
NO. The general rule is that a decision or an order of a COMELEC Division cannot be elevated
directly to this Court through a special civil action for certiorari. Furthermore, a motion to reconsider
a decision, resolution, order, or ruling of a COMELEC Division shall be elevated to the COMELEC En
Banc. However, a motion to reconsider an interlocutory order of a COMELEC Division shall be
resolved by the division which issued the interlocutory order, except when all the members of the
division decide to refer the matter to the COMELEC En Banc. Thus, in general, interlocutory orders
of a COMELEC Division are not appealable, nor can they be proper subject of a petition for certiorari.
To rule otherwise would not only delay the disposition of cases but would also unnecessarily clog the
Court docket and unduly burden the Court. This does not mean that the aggrieved party is without
recourse if a COMELEC Division denies the motion for reconsideration. The aggrieved party can still
assign as error the interlocutory order if in the course of the proceedings he decides to appeal the
main case to the COMELEC En Banc.
The Court has already ruled in Reyes v. RTC of Oriental Mindoro, that "it is the decision, order
or ruling of the COMELEC En Banc that, in accordance with Section 7, Art. IX-A of the Constitution,
may be brought to the Supreme Court on certiorari." Plainly, from the foregoing, the Court has no
jurisdiction to review an order, whether final or interlocutory, even a final resolution of a division of
the COMELEC. Stated otherwise, the Court can only review via certiorari a decision, order, or ruling
of the COMELEC en banc in accordance with Section 7, Article IX-A of the Constitution.
REPUBLIC OF THE PHILIPPINES v. CPO MAGDALENO PERALTA (Ret.), et al.

G.R. No. 184253, 6 July 2011, SECOND DIVSION (Carpio, J.)
When a person agreed to comply with terms and regulations of the contract, judicial action is
no longer necessary to evict him from the property. The assent means that he authorized the
extrajudicial taking of the possession of the property.
When CPO Magdaleno Peralta (Peralta), et. al were still in active service at the Philippine
Navy, all of them were awarded military quarters. They entered into contract of lease with the BNS
Commander for their occupation of the said quarters. Subsequently, Philippine Navy and Marines
occupying BNS quarters formed the Navy Enlisted Homeowners Association, Inc. (NEHAI). However,
even after their retirement, they continued to occupy thei assigned quarters. NEHAI filed before the
Regional Trial Court (RTC) petition for declaratory relief against DENR, LMB and AFP Officers Village.
It claimed that its members, as actual occupants, have right of first priority to purchase the property.
Some of the NEHAI members received a letter advising them to vacate their respective quarters.
NEHAI informed BNS Commander of their pending petition for declaratory relief. To forestall their
ejectment, Peralta, et. al, filed complaint for injunction against Philippine Navy. Trial Court granted
the application. On appeal, Court of Appeals (CA) dismissed the petition for lack of merit and ruled
that trial court acted within its jurisdiction in issuing the writ. Republic argued that judicial action is
not necessary to evict Peralta, et al from the leased military quarters because their contract of lease
have long expired.
ISSUE:
Whether or not it is indispensable for the Republic to file an ejectment suit before it may evict
NEHAI members from the subject military housing quarters
RULING:
NO. Peralta, et al agreed to comply with regulations of the contract of lease. In view of this,
judicial action is no longer necessary to evict Peralta, et al from the military quarters. They authorized
Republic to extrajudicially take over the possession of the leased military housing quarters after their
retirement. In the case at bar, they had long retired from military service. Therefore, they are no
longer entitled to stay in the military quarters because their contracts of lease have been terminated
by their retirement from the service. The naval facility is outside the commerce of man and the lease
of quarters to military personnel in the service is merely incidental to their military service. Such
lease is not an ordinary lease of residential or commercial building. Upon retirement of the military
personnel, their quarters have to be occupied by the military personnel in the active service who
replace them.
FERDINAND A. CRUZ v. JUDGE HENRICK F. GINGOYON, [Deceased], JUDGE JESUS B. MUPAS,

Acting Presiding Judge, Regional Trial Court Branch 117, Pasay City
G.R. No. 170404, 28 September 2011, FIRST DIVISION, (Del Castillo, J.)
A pleading containing derogatory, offensive or malicious statements submitted to the court or

judge wherein proceedings are pending is considered direct contempt.
In ruling in the case for abatement filed by Ferdinand A. Cruz (Cruz) against his neighbor
Benjamin Mina, Jr. (Mina), Judge Henrick F. Gingoyon (Judge Gingoyon) of Regional Trial Court (RTC)
of Pasay City (RTC Pasay) declared that the "basketball goal" which was permanently attached to the
second floor of Mina’s residence was a nuisance however Cruz lacked "locus standi” to file a case since
the law provides that an action for abatement of nuisance should be commenced by the city or
municipal mayor and not by a private individual.
Cruz moved for reconsideration. As requested by Cruz, his motion for reconsideration was
set for hearing. Judge Gingoyon directed him to substantiate his serious charge or show cause and
why he should not be punished for contempt. However at the scheduled date for hearing, Cruz failed
to appear which prompted Judge Gingoyon to issue a Show Cause Order against Cruz. In his response,
Cruz reiterated his allegations against the court. Later, Judge Gingoyon found Cruz guilty of direct
contempt of court holding that Cruz’s open accusation without factual basis that the judge is
communicating with the defendant is an act that brings the court into disrepute or disrespect; or
offends its dignity, affront its majesty, or challenge its authority. Judge Gingoyon ordered the
imprisonment of Cruz for two (2) days and pay the fine of 2, 000. Consequently, an Order of Arrest
was issued against Cruz.
Cruz filed an Urgent Ex-Parte Motion to Post Bond and Quash Warrant of Arrest however the
same was denied. During the pendency of the case, Judge Gingoyon was killed. As such, the incumbent
Judge, Judge Jesus B. Mupas was directed to submit a comment as much as the charge for contempt
was against the court and not to the Judge in their personal capacity.
ISSUE:
Whether or not Cruz is guilty of Contempt of Court.
RULING:
YES. Contemptuous statements made in pleadings filed with the court constitute direct
contempt. A pleading containing derogatory, offensive or malicious statements submitted to the
court or judge in which the proceedings are pending has been held to be equivalent to ‘misbehavior
committed in the presence of or so near a court or judge as to interrupt the proceedings before the
same’ within the meaning of Rule 71, § 1 of the Rules of Court and, therefore, constitutes direct
contempt.
The act of Cruz in openly accusing Judge Gingoyon of communicating with the defendant off
the record, without factual basis, brings the court into disrepute. The accusation in the Motion for
Reconsideration and the Compliance submitted by Cruz to the court is derogatory, offensive and
malicious. The accusation taints the credibility and the dignity of the court and questions its
impartiality. It is a direct affront to the integrity and authority of the court, subjecting it to loss of
public respect and confidence, which ultimately affects the administration of justice.
Furthermore, assuming that the conclusion of Cruz is justified by the facts, it is still not a valid
defense in cases of contempt. "Where the matter is abusive or insulting, evidence that the language
used was justified by the facts is not admissible as a defense. Respect for the judicial office should
always be observed and enforced."
NM ROTHSCHILD & SONS (AUSTRALIA) LTD. v. LEPANTO CONSOLIDATED MINING COMPANY

A Motion to Dismiss is an interlocutory order. The general rule is that the denial of a Motion to
Dismiss cannot be questioned in a special civil action for Certiorari which is a remedy designed to correct
errors of jurisdiction and not errors of judgment. However, when the denial is tainted with grave abuse
of discretion, the grant of the extraordinary remedy of Certiorari may be justified.
petition.
ISSUE:
Whether or not the Resort to a Petition for Certiorari with the Court of Appeals was proper.
RULING:
YES. The Court have held time and again that an order denying a Motion to Dismiss is an
interlocutory order which neither terminates nor finally disposes of a case as it leaves something to
be done by the court before the case is finally decided on the merits. The general rule, therefore, is
that the denial of a Motion to Dismiss cannot be questioned in a special civil action
for Certiorari which is a remedy designed to correct errors of jurisdiction and not errors of
judgment. However, we have likewise held that when the denial of the Motion to Dismiss is tainted
with grave abuse of discretion, the grant of the extraordinary remedy of Certiorari may be
justified. By grave abuse of discretion is meant “Such capricious and whimsical exercise of judgment
that is equivalent to lack of jurisdiction. The abuse of discretion must be grave as where the power is
exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and must be
so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the
duty enjoined by or to act all in contemplation of law.”
CHINA BANKING CORPORATION v. ARMI S. ABEL

G.R. No. 182547, 10 January 2011, SECOND DIVISION (ABAD, J.)
Orders for the issuance of a writ of possession are issued as a matter of course upon the filing of
the proper motion and approval of the corresponding bond since no discretion is left to the court to deny
it.
In a foreclosure sale, China Banking Corporation (China Bank) acquired title over Armi S.
Abels’ property, she having failed to pay her loan. To enforce its ownership, China Bank filed with the
Regional Trial Court (RTC) an ex parte petition for the issuance of a writ of possession in its favor.
The RTC rendered a decision, granting China Banks petition and directing the issuance of a writ of
possession over the property in its favor. Abel appealed from this decision but lost her appeal in the
Court of Appeals (CA). She filed a petition for review before the Supreme Court but this, too,
failed. She filed a motion for reconsideration and a second similar motion without success. The
Courts judgment became final and executory and, eventually, the record of her case was remanded
to the RTC for execution. China Bank filed a motion for execution with the RTC.
Abel filed a motion to cancel and reset the hearing on the ground that she needed more time
to comment on or oppose the banks motion. The RTC granted her the 10-day period she asked but
from notice. Abels failed to file her opposition to or comment on the motion for execution, the RTC
issued an Order granting China Banks motion. After being served with the notice to vacate, Abel filed
an omnibus urgent motion for reconsideration and to admit her opposition to the banks motion for
execution. However, the day after receiving her motion, the RTC denied the same for lack of merit.
The sheriff implemented the writ against Abel and placed China Bank in possession of the subject
property. Abel filed a petition for certiorari with the CA. Abel took back possession of the premises
on the strength of a Temporary Restraining Order (TRO) that the CA issued. The CA then set aside
the orders of the RTC. China Bank moved for its reconsideration but the CA denied this. The CA ruled
that the RTC committed grave abuse of discretion in granting the banks motion for execution, noting
that the latter court gave Abel 10 days from notice of its order, not 10 days from the issuance of such
order, within which to file her opposition.
ISSUE:
Whether the CA erred in setting aside the RTC’s Orders on the ground of failure to observe
due process respecting Abels right to be heard on the banks motion for execution.
RULING:
YES. The CA erred in attributing grave abuse of discretion to the RTC. Although the RTC
caused the issuance of the writ of execution before it could establish that Abels 10 days from notice
within which to file her opposition had lapsed, she filed with that court on June 21, 2007 an urgent
motion for reconsideration with her opposition to the motion for execution attached. The Court,
acting on her motion, denied it on the following day, June 22, 2007. Any perceived denial of her right
to be heard on the banks motion for execution had been cured by her motion for reconsideration and
the RTCs action on the same. She cannot complain that the court acted on her motion more promptly
than she expected especially since she actually offered no legitimate reason for opposing the issuance
of a writ of possession in the banks favor.
Orders for the issuance of a writ of possession are issued as a matter of course upon the filing
of the proper motion and approval of the corresponding bond since no discretion is left to the court
to deny it. The RTCs issuance of such writ conformably with the express provisions of law cannot be
regarded as done without jurisdiction or with grave abuse of discretion. Such issuance being
ministerial, its execution by the sheriff is likewise ministerial.
CEFERINA LOPEZ TAN v. SPOUSES APOLINAR P. ANTAZO and GENOVEVA O. ANTAZO

G.R. No. 187208, 23 February 2011, FIRST DIVISION, (Perez, J.)
Petition for certiorari under Rule 65 of the Rules of Court is a pleading limited to correction of
errors of jurisdiction or grave abuse of discretion amounting to lack or excess of jurisdiction. Its
principal office is to keep the inferior court within the parameters of its jurisdiction or to prevent it from
committing such a grave abuse of discretion amounting to lack or excess of jurisdiction.
Spouses Apolinar and Genoveva Antazo (Sps. Antazo) are the registered owners of two
parcels of land. An accion reinvindicatoria suit with damages, was filed by Sps. Antazo against
Ceferina Lopez Tan (Tan) for encroaching on their properties. On 25 July 2008, the Regional Trial
Court (RTC) rendered judgment favoring Sps. Antazo.
Tan filed a motion for reconsideration but was later denied by the RTC. Aggrieved, Tan filed
a petition for certiorari before the Court of Appeals (CA) which dismissed the petition for adopting a
wrong remedy or mode of appeal. Tan filed a motion for reconsideration but it was subsequently
denied. Hence, the petition.
ISSUE:
Whether or not the special civil action for certiorari before the Court of Appeals as a remedy
against the Decision and Resolution of the Regional Trial Court is correct.
RULING:
NO. A petition for certiorari under Rule 65 of the Rules of Court may issue only when the
following requirements are alleged in and established by the petition: (1) that the writ is directed
against a tribunal, a board or any officer exercising judicial or quasi-judicial functions; (2) that such
tribunal, board or officer has acted without or in excess of jurisdiction, or with grave abuse of
discretion amounting to lack or excess of jurisdiction; and (3) that there is no appeal or any plain,
speedy and adequate remedy in the ordinary course of law.
Only the first requisite is here present. Ceferina Lopez Tan correctly impleaded the trial court
judge in her certiorari petition. Regarding to the second requisite, it is well-settled that a petition
for certiorari against a court which has jurisdiction over a case will prosper only if grave abuse of
discretion is manifested. The burden is on the part of Ceferina Lopez Tan to prove not merely
reversible error, but grave abuse of discretion amounting to lack or excess of jurisdiction on the part
of the RTC issuing the impugned order. Mere abuse of discretion is not enough; it must be grave. The
term grave abuse of discretion is defined as a capricious and whimsical exercise of judgment so
patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty
enjoined by law, as where the power is exercised in an arbitrary and despotic manner because of
passion or hostility.
Anent the third requisite, a writ of certiorari will not issue where the remedy of appeal is
available to the aggrieved party. The party aggrieved by a decision of the Court of Appeals is
proscribed from assailing the decision or final order of said court via Rule 65 of the Rules of Court
because such recourse is proper only if the party has no plain, speedy and adequate remedy in the
course of law. Furthermore, certiorari cannot be availed of as a substitute for the lost remedy of an
ordinary appeal.In this case, the remedy of appeal under Rule 42 of the Rules of Court was clearly
available to Ceferina Lopez Tan. She however chose to file a petition for certiorari under Rule 65. As
the Court of Appeals correctly surmised and pointed out,Ceferina Lopez Tan availed of the remedy
of certiorari to salvage her lost appeal.
SPS. VICENTE DIONISIO AND ANITA DIONISIO v. WILFREDO LINSANGAN

An action for unlawful detainer sufficiently alleges the following: a) initially, defendant has
possession of property by contract or tolerance; b) possession became illegal upon notice to defendant;
c) still, defendant remains in possession depriving plaintiff of the enjoyment of his property; and d)
within a year from last demand to vacate the property, the plaintiff files a complaint for ejectment.
Gorgonio Cruz (Cruz) owned agricultural lands that his tenant Romualdo San Mateo
(Romulado) cultivated. Upon Romualdo’s death, his widow, Emiliana San Mateo (Emiliana), got
Cruz’s permission to stay on the property provided she would vacate it upon demand. Spouses
Vicente and Anita Dionisio (Sps. Dionisio) bought the property from Cruz. Sps. Dionision learned that
Emiliana had left the property and it was already Wilfredo Linsangan (Linsangan) who occupied it
under “Kasunduan ng Bilihan ng Karapatan”. Sps. Dionisio demanded Linsangan to vacate the land
but he declined, prompting the filing the eviction suit.
At the pre-trial Sps. Dionisio amended their complaint. Municipal Trial Court (MTC) ordered
Linsangan to vacate the land and remove his house from it. Further, MTC ordered Linsangan to pay
reasonable compensation for the use of land. Regional Trial Court (RTC) affirmed the MTC holding
that the case was one for forcible entry. On review, Court of Appeals (CA) held that by amending their
complaint, Sps. Dionisio effectively changed their cause of action from unlawful detainer to recovery
of possession which fell outside the jurisdiction of MTC.
ISSUES:
1. Whether or not the action is one for unlawful detainer.

2. Whether or not Sps. Dionisio’s amendment of their complaint effectively changed their
cause of action from one of the ejectment to one of recovery of possession.
RULING:
1. YES. An action for unlawful detainer sufficiently alleges the following: a) defendant has
possession of property by contract or tolerance; b) possession became illegal upon notice to
defendant; c) defendant remains in possession depriving plaintiff of the enjoyment of his property;
and d) within a year from last demand, the plaintiff files a complaint for ejectment. If defendant had
possession of land upon mere tolerance of the owner, such tolerance should be present at the
beginning of possession. In the case at bar, based on the amended complaint, Sps. Dionisio allowed
Emiliana to stay on the land for the meantime. But, without knowledge, she sold her right of tenancy
to Linsangan. Sps. Dionisio demanded that he leave the land, but he refused. These allegations clearly
imply the Sps. Dionisio’s “tolerance” of Emiliana’s stay for the meantime that they did not yet need
the land.
2. NO. The amended complaint has essentially identical allegations. The only new ones are
that the Sps. Dionisio allowed Emiliana, Romualdo’s widow to stay out of their kindness; that
Linsangan cannot deny that Cruz was the previous registered owner and that he sold it to Sps.
Dionisio; and that a person occupying another’s land by the latter’s tolerance is bound by an implied
promise to leave upon demand. To determine if an amendment introduces a different cause of action,
the test is whether such amendment now requires the defendant to answer for liability which is
completely different from that stated in the original complaint. In the case at bar, both the original
and the amended complaint required Linsangan to defend his possession based on the allegation that
he stayed on the land after Emiliana left out of the owner’s mere tolerance. Linsangan need not to file
new answer.
ROSA DELOS REYES v. SPOUSES FRANCISCO ODONES , et al.
G.R. No. 178096, March 23, 2011, SECOND DIVISION (Nachura, J.)
A complaint sufficiently alleges a cause of action for unlawful detainer if it recites the following:
(1) initially, possession of property by the defendant was by contract with or by tolerance of the plaintiff;
(2) eventually, such possession became illegal upon notice by plaintiff to defendant of the termination
of the latter's right of possession; (3) thereafter, the defendant remained in possession of the property
and deprived the plaintiff of the enjoyment thereof; and (4) within one year from the last demand on
defendant to vacate the property, the plaintiff instituted the complaint for ejectment.
Rosa Delos Reyes (Delos Reyes) filed a complaint for unlawful detainer with preliminary
injunction against Spouses Francisco and Arwenia Odones (Spouses Odones), Noemi Otales (Otales),
and Gregorio Ramirez (Ramirez). She alleged that she is the registered owner of the parcel of land
and that Spouses Odones, Otales and Ramirez are staying on the property with house/improvements
therein with mere tolerance of Dela Rosa only without any contract and for which there is an implied
understanding to vacate upon demand. She made a verbal demand for them to vacate the premises
which they refused and for which a written notice was sent advising them to leave within fifteen (15)
days from the receipt thereof. Spouses Odones, Otales, and Ramirez claimed that they are the owners
of the lot and denied that their occupancy was by virtue of tolerance.
The Municipal Trial Court (MTC) ruled in favor of Dela Rosa, but was set aside by the Regional
Trial Court (RTC), as affirmed by the Court of Appeals (CA). The RTC held that the complaint failed to
aver acts constitutive of forcible entry or unlawful detainer since it did not state how entry was
effected or how and when the dispossession started. Hence, the remedy should either be accion
publiciana or accion reivindicatoria in the proper RTC. The CA added that in order to justify an action
for unlawful detainer, the owner’s permission or tolerance must be present at the beginning of the
possession.
ISSUE:
Whether or not the complaint sufficiently allege facts constitutive of unlawful detainer.
RULING:
YES. A complaint sufficiently alleges a cause of action for unlawful detainer if it recites the
following: (1) initially, possession of property by the defendant was by contract with or by tolerance
of the plaintiff; (2) eventually, such possession became illegal upon notice by plaintiff to defendant of
the termination of the latter's right of possession; (3) thereafter, the defendant remained in
possession of the property and deprived the plaintiff of the enjoyment thereof; and (4) within one
year from the last demand on defendant to vacate the property, the plaintiff instituted the complaint
for ejectment.
Contrary to the findings of the RTC and the CA, Dela Rosa’s allegations in the complaint clearly
makes out a case for unlawful detainer, essential to confer jurisdiction over the subject matter on the
MTC. She alleged that she is the owner of the lot; that Spouses Odones, Otales, and Ramirez are
occupying the lot by virtue of her tolerance; and that she sent a letter to them demanding that they
vacate the property, but they failed and refused to do so. The complaint was filed within one year
from the time the last demand to vacate was made. Firm is the rule that as long as these allegations
demonstrate a cause of action for unlawful detainer, the court acquires jurisdiction over the subject
matter.

ALEJANDRO S. URRO, IN HIS CAPACITY AS THE NEW APPOINTEE VICE HEREIN PETITIONER
HON. LUIS MARIO M. GENERAL, NATIONAL POLICE COMMISSION
G.R. No. 191560, March 29, 2011, EN BANC (Brion, J.)
For a petition for quo warranto to be successful, the suing private individual must show a clear
right to the contested office. His failure to establish this right warrants the dismissal of the suit for lack
of cause of action; it is not even necessary to pass upon the right of the defendant who, by virtue of his
Then President Gloria Macapagal-Arroyo (PGMA) appointed Imelda Roces (Roces) as acting
Commissioner of the NAPOLCOM, representing the civilian sector, and later as acting NAPOLCOM
Commissioner. When Roces died, PGMA appointed the Luis Mario General (General)
as acting NAPOLCOM Commissioner in place of Roces. Also, PGMA appointed Eduardo Escueta
(Escueta) as acting NAPOLCOM Commissioner and designated him as NAPOLCOM Vice Chairman.
Later, PGMA appointed Alejandro Urro (Urro) in place of the General, Constancia de Guzman in place
of Celia Leones, and Escueta as permanent NAPOLCOM Commissioners. DILG Head Executive
Assistant/Chief-of-Staff Pascual Veron Cruz, Jr. (Cruz) issued separate congratulatory letter to Urro.
After being furnished a copy of the congratulatory letter, General filed a petition for quo warranto
questioning the validity of Urro’s appointment on the ground that it violates the constitutional
prohibition against midnight appointments. However, the newly elected President, Benigno S.
Aquino III, issued Executive Order No. 2 (E.O. No. 2) revoking the appointments issued by the by
PGMA in violation of the constitutional ban on Midnight Appointments. Urro posits that General is
not a real part-in-interest to file the petition for quo warranto since he was merely appointed in an
acting capacity and could be removed from office at anytime.
ISSUE:
Whether or not General has a cause of action to file a petition for quo warranto.
RULING:
NO. Quo warranto is a remedy to try disputes with respect to the title to a public office.
Generally, quo warranto proceedings are commenced by the Government as the proper party-
plaintiff. However, under Section 5, Rule 66 of the Rules of Court, an individual may commence such
action if he claims to be entitled to the public office allegedly usurped by another. The person
instituting the quo warranto proceedings in his own behalf must show that he is entitled to the office
in dispute; otherwise, the action may be dismissed at any stage. Emphatically, Section 6, Rule 66 of
the same Rules requires the petitioner to state in the petition his right to the public office and the
respondent’s unlawful possession of the disputed position. The Court already held that for a petition
for quo warranto to be successful, the suing private individual must show a clear right to the
contested office. His failure to establish this right warrants the dismissal of the suit for lack of cause
of action; it is not even necessary to pass upon the right of the defendant who, by virtue of his
Since General merely holds an acting appointment, he clearly does not have a cause of action
to maintain the present petition. The essence of an acting appointment is its temporariness and its
consequent revocability at any time by the appointing authority. General, in a quo
warranto proceeding who seeks reinstatement to an office, on the ground of usurpation or illegal
deprivation, must prove his clear right to the office for his suit to succeed; otherwise, his petition
must fail.
SPOUSES MANUEL AND FLORENTINA DEL ROSARIO v. GERRY ROXAS FOUNDATION, INC.
The allegations in the complaint and the reliefs prayed for are the determinants of the nature
of the action and of which court has jurisdiction over the action.
Spouses Manuel and Florentina Del Rosario (Spouses Del Rosario) filed a complaint for
Unlawful Detainer against Gerry Roxas Foundation Inc. Spouses Del Rosario alleged in their
Complaint before the MTCC, among others, that: (1) sometime in 1991, without their consent and
authority, Roxas Foundation took full control and possession of the subject property, developed the
same and used it for commercial purposes; and (2) they allowed the Roxas Foundation for several
years, to make use of the land without any contractual or legal basis. Spouses Del Rosario thus
conclude that Roxas Foundation’s possession of subject property is only by tolerance. On the other
hand, Roxas Foundation raised as an affirmative defense the spouses Del Rosario’s lack of cause of
action.
ISSUE:
Whether or not the complaint state a cause of action for unlawful detainer.
RULING:
NO. Taken in its entirety, the allegations in the complaint establish a cause of action for
forcible entry, and not for unlawful detainer. In their Complaint, spouses Del Rosario maintained that
Roxas Foundation took possession and control of the subject property without any contractual or
legal basis. Assuming that these allegations are true, it hence follows that Roxas Foundation’s
possession was illegal from the very beginning. Therefore, the foundation of spouses Del Rosario’s
complaint is one for forcible entry that is the forcible exclusion of the original possessor by a person
who has entered without right. Thus, there can be no tolerance as the spouses Del Rosario alleged
that Roxas Foundation’s possession was illegal at the inception.
Corollarily, since the deprivation of physical possession, as alleged in the complaint and as
earlier discussed, was attended by strategy and force, this Court finds that the proper remedy for the
spouses Del Rosario was to file a Complaint for Forcible Entry and not the instant suit for unlawful
detainer. Consequently, the spouses should have filed a Complaint for Forcible Entry within the
reglementary one-year period from the time of dispossession which however they failed to do so.

CRISTINA TRINIDAD ZARATE ROMERO
G.R. No. 163827, 17 August 2011, FIRST DIVISION, (Villarama, Jr., J)
The petition questioning the first three orders was filed late as the petition should have been
filed within 60 days from receipt of the assailed orders.
Corazon Zarate Romero and his brother Gonzalo Zarate co-owned a property located
in Dagupan City, Province of Pangasinan, with a four-storey hotel erected thereon. It appears that
sometime in 1975, Corazon and Gonzalo obtained a loan from Development Bank of the Philippines.
As collateral, they executed a real estate mortgage over the subject property in favor of DBP. On the
alleged failure of the two borrowers to pay their amortizations, DBP foreclosed the real estate
mortgage on September 15, 1983. Purportedly, no redemption was made within one year, and thus,
DBP consolidated ownership over the subject property.
When Corazon passed away, her sole heir, her daughter respondent Cristina Trinidad Zarate
Romero, asserted ownership over the subject property to the extent of one-half thereof. However,
respondent discovered that the property was already registered as early as June 13, 1989 in the name
of DBP. Romero filed before the Regional Trial Court a complaint for reconveyance, quieting of title
and damages with prayer for a temporary restraining order and writ of preliminary injunction to
prevent DBP from conducting any auction sale on the subject property during the pendency of the
case. The RTC, after hearing, issued a TRO restraining DBP from proceeding with its scheduled
auction of the disputed. DBP filed a petition for certiorari before the CA. The CA dismissed the petition
on procedural grounds. It held that the petition questioning the first three orders was filed late as the
petition should have been filed within 60 days from receipt of the assailed orders.
ISSUES:
Whether or not the petition for certiorari assailing the orders pertaining to the grant of the
TRO and the writ of injunction were filed out of time.
RULING:
YES. The petition for certiorari assailing the orders pertaining to the grant of the TRO and the
writ of injunction were filed out of time. Notice of the issuance of the TRO was received by DBP on
the same day it was granted, November 24, 1998; thus, the petition for certiorari should have been
filed not later than January 23, 1999. The denial of the motion for reconsideration of the order
granting the writ of injunction, on the other hand, was received by DBP on March 18, 1999 and thus,
it had only until May 17, 1999 to file the petition for certiorari. DBP, however, filed its petition only
on June 23, 1999.
CITY OF MANILA v. MELBA TAN TE

G.R. No. 169263, 21 September 2011, THIRD DIVISION (Peralta J.)
Expropriation proceedings are governed by Rule 67 of the Rules of Court which dispenses with
the filing of an extraordinary motion to dismiss. The present rule requires the filing of an answer as
responsive pleading to the complaint. Thus, the defendant who has objections to the taking of his
property is now required to file an answer and in it raise all his available defenses against the allegations
in the complaint for eminent domain.
Then Manila City Lito Atienza approved Ordinance No. 7951, an expropriation measure
authorizing him to acquire by negotiation or expropriation certain real property where low-cost
housing units could be built and then awarded to bona fide residents therein. One of those included
was the property of Meba Tan Te (Te). Te acquired the property from one Emerlinda. It was already
occupied by several families whose leasehold rights have already expired. Tesecured a writ of
execution from a previous ejectment case, but it remained unexecuted, as it was opposed
by(petitioner) City of Manila.
Between the time an order of execution and a writ of demolition were issued, the City of
Manila filed an expropriation complaint against the property. The RTC dismissed the first compliant
upon motion to dismiss by Te for failure to show that an ordinance authorised the expropriation, and
non-compliance with Republic Act 7279 (Urban Development and Housing Act of 1992).
The City of Manila then filed a second complaint for expropriation before the RTC Manila and
attached a copy of Ordinance No. 7951. Meanwhile, Te submitted a motion to dismiss based on the
former’s non-compliance with R.A. No. 7279. The City moved that it be allowed to enter the property,
but before it could be resolved, the trial court issued its Order dismissing the complaint. The City of
Manila interposed an appeal to the Court of Appeals (CA) which, finding no merit therein, dismissed
the same. It then sought reconsideration, but it was denied.
ISSUE:
Whether or not the CA erred in dismissing the appeal on the ground that it failed to note that
the RTC’s dismissal of its complaint was premature, in that it has been denied an opportunity to show
previous compliance with the requirements of R.A. No. 7279.
RULING:
YES. Expropriation is a two-pronged proceeding: first, the determination of the authority of

the plaintiff to exercise the power and the propriety of its exercise and second, the determination by
the court of the just compensation. It is governed by Rule 67 of the Rules of Court which dispenses
with the filing of an extraordinary motion to dismiss. The present rule requires the filing of an answer
as responsive pleading to the complaint. Thus, the defendant in an expropriation case who has
objections to the taking of his property is now required to file an answer and in it raise all his available
defenses against the allegations in the complaint for eminent domain. While the answer is bound by
the omnibus motion rule, much leeway is nevertheless afforded to the defendant because
amendments may be made in the answer within 10 days from its filing. Also, failure to file the answer
does not produce all the disastrous consequences of default in ordinary civil actions, because the
defendant may still present evidence on just compensation.
Thus, the trial court in this case should have denied Te’s motion to dismiss and required her
to submit instead an answer within the reglementary period. This is because whether the City of
Manila has observed the provisions of R.A. No. 7279 before resorting to expropriation, and whether
respondent owns other properties than the one sought to be expropriated, and whether she is
actually a small property owner beyond the reach of eminent domain powers, are indeed issues in
the nature of affirmative defenses which require the presentation of evidence aliunde. Besides,
Section 1, Rule 16 of the Rules of Court does not consider these matters grounds for a motion to
dismiss, and an action can be dismissed only on the grounds authorized by this provision.
EDNA LOPEZ DELICANO, EDUARDO ALBERTO LOPEZ, MARIO DIEZ CRUZ,HOWARD E.

MENESES, and CORAZON E. MENESES v. PECHATEN CORPORATION
G.R. No. 191251, 7 September 2011, SECOND DIVISION (Carpio, J.)
“The right of the plaintiff to enter upon the property of the defendant and appropriate the same
to public use or purpose shall not be delayed by an appeal from judgment. But if the appellate court
determines that plaintiff has no right of expropriation, judgment shall be rendered ordering the
Regional Trial Court to forthwith enforce the restoration to the defendant of the possession of
the property, and to determine the damages which the defendant sustained and may recover by reason
of the possession taken by the plaintiff.” (Section 11, Rule 67 of the Rules of Civil Procedure)
Pechaten Corporation (Pechaten) is the registered owner of the subject property. Pechaten
and Dalmacia Meneses, etc. entered into a two-year lease contract involving the property.
Subsequently, the lessees executed a waiver of their rights or interest in the lease contract in favor
of Virgilio Meneses, the son of Dalmacia Meneses. When the lease contract expired, Pechaten
offered Virgilio to renew the lease or purchase the property. Virgilio, however, ignored the offer and
failed to pay monthly rentals. It then sent a demand letter to Virgilio to vacate the property and pay
accrued rentals. When Virgilio refused, Pechaten filed with the MeTC a case for unlawful detainer
with damages against him.
The MeTC rendered a judgment in favor of Pechaten. On appeal, the Regional Trial Court
(RTC) affirmed the MeTC judgment. Meanwhile, the City of Manila filed a complaint for expropriation
against Pechaten involving the property. The RTC issued an Order of Expropriation in favor of the
City of Manila.
Upon the death of Virgilio, he was substituted by his heirs, Edna Delicano, et. al. In view of the
Orders of the RTC involving the property in the expropriation case, theyfiled a motion for
reconsideration (MR). The RTC issued an Order partially reconsidering its Decision. On appeal, the
Court of Appeals (CA) affirmed the RTC decision. Pechaten then filed a MR. In its supplemental MR, it
attached a copy of the final and executor Decision of the CA-Special 6th Division in the related
expropriation case which dismissed the complaint for eminent domain filed by the City of Manila. It
alleged that the decision is a supervening event which warrants the reconsideration of the Decision
of the CA in this unlawful detainer case. The CA agreed. Hence, this petition.
ISSUE:
Whether or not Edna Delicano, et. al. are still entitled to retain possession over the subject
property despite the dismissal of the expropriation case.
RULING:
NO. Section 11, Rule 67 of the Rules of Civil Procedure provides that “The right of the plaintiff
to enter upon the property of the defendant and appropriate the same to public use or purpose shall
not be delayed by an appeal from judgment. But if the appellate court determines that plaintiff
has no right of expropriation, judgment shall be rendered ordering the Regional Trial Court
to forthwith enforce the restoration to the defendant of the possession of the property, and to
determine the damages which the defendant sustained and may recover by reason of the possession
taken by the plaintiff.”
In this case, the CA-Special 6th Division, in the related expropriation case, held that the
expropriation of the property was not for public use. In its final and executory Decision, it found that
the expropriation was intended for the sole benefit of the family of Virgilio Meneses. Therefore, it is
only proper that respondent should be restored to its rightful possession of the property in
accordance with Section 11, Rule 67 of the Rules of Civil Procedure.
PHILIPPINE GUARDIANS BROTHERHOOD, INC., REPRESENTED BY ITS SECRETARY-GENERAL

GEORGE “FGBF GEORGE” DULDULAO v. COMMISSION ON ELECTIONS (COMELEC)
G.R. No. 190529, 22 March 2011, EN BANC (Brion, J.)
Contempt is classified into direct and indirect. Direct contempt, which may be summary, is
committed "in the presence of or so near a court as to obstruct or interrupt the proceedings before the
same, including disrespect toward the court, offensive personalities toward others, or refusal to be
sworn or to answer as a witness, or to subscribe an affidavit or deposition when lawfully required to do
so.
The incidents in this case arose from the Status Quo Order directing the Commission on
Elections (COMELEC) to restore and maintain the Philippine Guardians Brotherhood, Inc. (PGBI) to
its situation prior to the issuance of COMELEC Resolution striking out PGBI in the list of candidates
under the party-list system in the May 10, 2010 elections pending the final determination of PGBI’s
qualification to be voted upon as a party-list organization.
COMELEC published a list of candidates. However, PGBI was not included. COMELEC then
responded to the Status Quo order of the Court, asking the latter to reconsider and/or recall its order.
PGBI then filed its comment to the motion filed alleging that COMELEC posited seemingly misleading
and innocuous reasons in seeking reconsideration. The Court then granted PGBI’s petition and
annulled the resolution of COMELEC. Before the elections, PGBI filed a manifestation before the Court.
However, COMELEC reiterated the arguments it previously raised. Hence, this petition.
ISSUE:
Whether or not COMELEC is guilty of contempt of Court.
RULING:
YES. Based on the recited antecedent facts, it cannot be disputed that the COMELC did not
comply with the Status Quo Order; it simply pleaded insurmountable and tremendous operational
constraints and costs implications as reasons for its avoidance to the Court’s Order. It essentially
posited that compliance with our Status Quo Order was rendered impossible by the automation of
the May 10, 2010 elections.
However, given the COMELEC’s own self-imposed deadline of February 4, 2010 for the
correction of errors and omissions, prior to printing, of the published list of participating party-list
groups and organizations in the May 10, 2010 elections, the COMELEC’s deadline could only mean
that the it had determined that changes in the official ballot could still be made at any time prior to
the deadline. In the context of the cases then pending involving the registration of party-list
organizations, the deadline was a clear signal from the COMELEC that the cases would have to be
resolved before the deadline; otherwise, the COMELEC could not be held liable for their non-
inclusion.
However, in an exercise as important as an election, the COMELEC cannot make a declaration
and impose a deadline, and, thereafter, expect everyone to accept its excuses when it backtracks on
its announced declaration. The COMELEC knew very well that there were still cases pending for
judicial determination that could have been decided before the deadline was set. To be excused, the
COMELEC needed more than its generalized descriptions of the process of ballot printing and the
alleged problems it faced. It needs reasons on how and why the deadline was set, as well as detailed
and specific reasons why PGBI could no longer be listed while other errors and omissions could still
be remedied.
Unfortunately for the COMELEC, the Court did not see that kind of justification in its
Compliance. Like the COMELEC, the Court expects obedience to and respect for their Orders and
Resolutions, and the Court cannot be sidetracked based solely on supposed operational constraints
caused by the automated polls. Its treatment of the Status Quo Order simply meant that even before
the COMELEC deadline, a definitive ruling that a party-list organization should be included in the list
to be voted upon would have been for naught, as the COMELEC would have anyway pleaded
automation constraints. Even if its excuse had been meritorious, the COMELEC effectively would have
been guilty of misrepresentation on an election matter and in dealing with the Court.
ALTERNATIVE DISPUTE RESOLUTION
LICOMCEN INCORPORATED v. FOUNDATION SPECIALISTS, INC.

G.R. No. 167022, 4 April 2011, THIRD DIVISION, (BRION, J.)
The Court declared that the bare fact that the parties incorporated an arbitration clause in their
contract is sufficient to vest the CIAC with jurisdiction over any construction controversy or claim
between the parties. The arbitration clause in the construction contract ipso facto vested the CIAC with
jurisdiction.
LICOMCEN Incorporated is a domestic corporation engaged in the business of operating

shopping malls in the country. LICOMCEN was granted by the City of Legazpi the right to the
construction of a Citimall. Since the Citimall was envisioned to be a high-rise structure, LICOMCEN
contracted Foundation Specialists, Inc. (FSI) to do initial construction works, specifically, the
construction and installation of bored piles foundation.
Subsequently, however, LICOMCEN instructed FSI to hold all construction activities on the
project, in view of a pending administrative case against the officials of the City Government of
Legaspi and LICOMCEN filed before the Ombudsman. In response, FSI sent a letter, requesting
payment of costs incurred on account of the suspension. FSI repeated its demand for payment.
LICOMCEN replied to FSIs demands for payment objecting to some of the claims. FSI sent a final
demand letter to LICOMCEN for payment. Since LICOMCEN took no positive action on FSIs demand
for payment, FSI filed a petition for arbitration with the Construction Industry Arbitration
Commission (CIAC).
LICOMCEN principally raises the question of the CIACs jurisdiction, insisting that FSIs claims
are non-arbitrable. In support of its position, LICOMCEN cites their arbitration clause which provides
for a condition precedent before the case can be filed before CIAC. LICOMCEN contends that FSI failed
to comply with the condition precedent for arbitration laid down in GC-61 of the GCC. An arbitrable
dispute under GC-61 must first be referred to and settled by LICOMCEN, which has 30 days to resolve
it. If within a period of 30 days from receipt of LICOMCENs decision on the dispute, either party does
not officially give notice to contest such decision through arbitration, the said decision shall remain
final and binding. However, should any party, within 30 days from receipt of LICOMCENs decision,
contest said decision, the dispute shall be submitted for arbitration under the Construction Industry
Arbitration Law. Further, LICOMCEN posits that only disputes in connection with or arising out of
the execution of the Works are subject to arbitration. LICOMCEN construes the phrase execution of
the Works as referring to the physical construction activities, since Works under the arbitration clause
specifically refer to the structures and facilities required to be constructed and completed for the
Citimall project. It considers FSIs claims as mere contractual monetary claims that should be litigated
before the courts of Legaspi City.
ISSUE:
Whether or not CIAC has jurisdiction.
RULING:
YES. The jurisdiction of the CIAC may include but is not limited to violation of specifications
for materials and workmanship; violation of the terms of agreement; interpretation and/or
application of contractual time and delays; maintenance and defects; payment, default of employer
or contractor and changes in contract cost. Excluded from the coverage of this law are disputes
arising from employer-employee relationships which shall continue to be covered by the Labor Code
of the Philippines.
The jurisdiction of courts and quasi-judicial bodies is determined by the Constitution and the
law. It cannot be fixed by the will of the parties to a dispute; the parties can neither expand nor
diminish a tribunals jurisdiction by stipulation or agreement. The text of Section 4 of E.O. 1008 is
broad enough to cover any dispute arising from, or connected with construction contracts, whether
these involve mere contractual money claims or execution of the works. Considering the intent
behind the law and the broad language adopted, LICOMCEN erred in insisting on its restrictive
interpretation of GC-61. The CIACs jurisdiction cannot be limited by the parties’ stipulation that only
disputes in connection with or arising out of the physical construction activities (execution of the
works) are arbitrable before it.
In fact, all that is required for the CIAC to acquire jurisdiction is for the parties to a
construction contract to agree to submit their dispute to arbitration. An arbitration agreement or a
submission to arbitration shall be in writing, but it need not be signed by the parties, as long as the
intent is clear that the parties agree to submit a present or future controversy arising from a
construction contract to arbitration.Under GC-61 and GC-05 of the GCC, read singly and in relation
with one another, the Court sees no intent to limit resort to arbitration only to disputes relating to
the physical construction activities. As to the condition precedent, if the CIACs jurisdiction can
neither be enlarged nor diminished by the parties, it also cannot be subjected to a condition
precedent. To reiterate, all that is required for the CIAC to acquire jurisdiction is for the parties to
agree to submit their dispute to voluntary arbitration. The mere existence of an arbitration clause in
the construction contract is considered by law as an agreement by the parties to submit existing or
future controversies between them to CIAC jurisdiction, without any qualification or condition
precedent.
EVIDENCE
Chain of Custody
PEOPLE OF THE PHILIPPINES v. ALBERTO BACUS ALCUIZAR
G.R. No. 189980, 6 April 2011, FIRST DIVISION, (Perez, J.)
Verily, the failure of the police officers to mark the dangerous drugs immediately after their
seizure and the vague recollection concerning the custody of the drugs from the residence of Alcuizar
up to the time it was submitted to the crime laboratory constitute a huge and significant gap in the
chain of custody which substantially affects the identity of the corpus delicti.
Alberto Alcuizar (Alcuizar) was charged with the crime of illegal possession of shabu in
violation of Section 11 of Republic Act No. 9165. The accused claims that the prosecution failed to
prove the very corpus delicti of the crime, considering that the chain of custody of the same is
unreliable. Alcuizar cites the failure of the police officer to mark the evidence immediately after
purportedly taking it from him. This omission, Alcuizar contends, renders the chain of custody
dubious.Alcuizar also points out the failure of the police officers to give or leave a copy of the
inventory receipt upon the accused or any of his family members pursuant to Section 21 of Republic
Act No. 9165 which are all without substantial reason to support as to its omission.
ISSUE:
Whether or not Alcuizar’s guilt was established beyond reasonable doubt.
RULING:
NO. In People v. Laxa, where the buy-bust team failed to mark the confiscated marijuana
immediately after the apprehension of the accused, the Court held that the deviation from the
standard procedure in anti-narcotics operations produced doubts as to the origins of the marijuana.
Consequently, the Court concluded that the prosecution failed to establish the identity of the corpus
delicti.The Court made a similar ruling in People v. Kimura, where the Narcom operatives failed to
place markings on the seized marijuana at the time the accused was arrested and to observe the
procedure and take custody of the drug.
Based on testimony, it was not indicated who had initial control and custody of the plastic
packs of shabu upon their confiscation. SPO1 Agadier merely claims that he turned them over to SPO1
Navales without specifying whether the latter received it while they were still inside theAlcuizar’s
house or at the police station. It is also not clear who was in possession of the plastic packs
of shabu while in transit. Moreover, SPO1 Navales did not testify to confirm the statement of SPO1
Agadier.
To successfully prosecute a case of illegal possession of dangerous drugs, the following

elements must be established: (1) the accused is in possession of an item or object which is identified
to be a prohibited drug; (2) such possession is not authorized by law; and (3) the accused freely and
consciously possessed the said drug.
Alcuizar is presumed to have been in possession of the prohibited drugs when they were
found in his house. While this presumption may be true, it is certainly not conclusive and may be
rebutted by contrary evidence. It is worthy to reiterate that this Court entertains serious doubts as
to whether the prohibited drugs were indeed found in Alquizar’s house considering that there were
no other witnesses presented to prove it. And it is by the same doubt that constrains this Court to
acquit Alquizar.
FRANCISCO IMSON y ADRIANO v. PEOPLE OF THE PHILIPPINES
G.R. No. 193003, 13 July 2011, EN BANC (Carpio, J.)
The failure of the policemen to make a physical inventory and to photograph the two plastic
sachets containing shabu do not render the confiscated items inadmissible in evidence.
During a buy-bust operation, Pajares, Pineda, the confidential informant, and other
policemen arrived at Raja Matanda Street at around 10:30 p.m. There, they saw Fransico Imson
(Imson) talking with Dayao. Thereafter, they saw Imson giving Dayao a transparent plastic sachet
containing white crystalline substance. Pajares approached the two men and introduced himself. He
immediately apprehended Imson while Pineda ran after Dayao who tried to escape. The policemen
confiscated two plastic sachets containing the suspected shabu. The policemen brought Imson and
Dayao to the Langaray Police Station where Imson and Dayao executed their joint sworn statements
and where PO1 Ariosto B. Rana marked the two plastic sachets with RDS and FIA. The two plastic
sachets were sent to the Philippine National Police - Northern Police Crime Laboratory Office for
examination. Both tested positive for shabu.
Third Assistant State Prosecutor Marcos filed two informations dated 27 January 2003 for
illegal possession of dangerous drugs against Imson and Dayao.The RTC found Imson and Dayao
guilty beyond reasonable doubt of illegal possession of dangerous drugs.
Appellant contends that they should be acquitted because of the procedural lapses committed
by the police operatives who failed to conduct a physical inventory of the subject specimen and to
photograph the same resulting in the failure of the prosecution to prove their guilt of the crime
charged.
ISSUE:
Whether or not Imson raises as issue that the two plastic sachets containing shabu were
inadmissible in evidence because the integrity of the chain of custody was impaired.
RULING:
NO. The failure of the policemen to make a physical inventory and to photograph the two
plastic sachets containing shabu do not render the confiscated items inadmissible in evidence. In
People v. Campos, the Court held that the failure of the policemen to make a physical inventory and to
photograph the confiscated items are not fatal to the prosecutions cause. In People v. Resurreccion,
the Court likewise held that the failure of the policemen to immediately mark the confiscated items
does not automatically impair the integrity of chain of custody.
The failure to strictly comply with Sec. 21(1), Art. II of RA 9165 does not necessarily render
an accused’s arrest illegal or the items seized or confiscated from him inadmissible. What is of utmost
importance is the preservation of the integrity and the evidentiary value of the seized items, as these
would be utilized in the determination of the guilt or innocence of the accused.
What Section 21 of R.A. No. 9165 and its implementing rule do not expressly specify is the
matter of marking of the seized items in warrantless seizures to ensure that the evidence seized upon
apprehension is the same evidence subjected to inventory and photography when these activities are
undertaken at the police station rather than at the place of arrest. Consistency with the chain of
custody rule requires that the marking of the seized items to truly ensure that they are the same
items that enter the chain and are eventually the ones offered in evidence should be done (1) in the
presence of the apprehended violator (2) immediately upon confiscation. To be able to create a first
link in the chain of custody, then, what is required is that the marking be made in the presence of the
accused and upon immediate confiscation. Immediate Confiscation has no exact definition. Thus, in
People v. Gum-Oyen, testimony that included the marking of the seized items at the police station and
in the presence of the accused was sufficient in showing compliance with the rules on chain of
custody. Marking upon immediate confiscation contemplates even marking at the nearest police
station or office of the apprehending team.
The presumption is that the policemen performed their official duties regularly. In order to
overcome this presumption, Imson must show that there was bad faith or improper motive on the
part of the policemen, or that the confiscated items were tampered. Imson failed to do so.
PEOPLE OF THE PHILIPPINES v. JHON-JHON ALEJANDRO y DELA CRUZ @ NOGNOG

G.R. No. 176350, 10 August 2011, SECOND DIVISION, (Brion, J)
Marking after seizure is the starting point in the custodial link; hence, it is vital that the seized
contraband be immediately marked because succeeding handlers of the specimens will use the markings
as reference.
An informant pointed at Jhon-Jhon Alejandro as a seller of illegal drugs. The police planned
an entrapment operation wherein PO1 Mengote was designated as the poseur-buyer. Alejandro and
the confiscated items were brought to the police station where the seized items were forwarded to
the Philippine National Police Crime Laboratory. The Regional Trial Court (RTC) found Alejandro
guilty of violating Section 5, Article II of R.A. No. 9165. On appeal, the Court of Appeals (CA) affirmed
the decision of the RTC.
ISSUE:
Whether or not Alejandro is guilty of violating RA 9165.
RULING:
NO. The prosecutions failure to comply with Section 21, Article II of R.A. No. 9165, and with
the chain of custody requirement of this Act compromised the identity of the item seized, leading to
the failure to adequately prove the corpus delicti of the crime charged.
Elements necessary for the prosecution of illegal sale of drugs under Section 5 of R.A. No.
9165 are: (1) the identity of the buyer and the seller, the object and the consideration; and (2) the
delivery of the thing sold and the payment therefor. What is material in the prosecution for illegal
sale of dangerous drugs is proof that the transaction or sale actually took place, coupled with the
presentation in court of evidence of the corpus delicti. To remove any doubt or uncertainty on the
identity and integrity of the seized drug, the evidence must definitely show that the illegal drug
presented in court is the very same illicit drug actually recovered from Alejandro. Otherwise, the
prosecution for drug pushing under R.A. No. 9165 fails.
Thus, crucial in proving chain of custody is the marking of the seized drugs or other related
items immediately after they are seized from the accused. Marking means the placing by the
apprehending officer or the poseur-buyer of his/her initials and signature on the items seized.
Marking after seizure is the starting point in the custodial link; hence, it is vital that the seized
contraband be immediately marked because succeeding handlers of the specimens will use the
markings as reference.
In the present case, the records do not show that the apprehending team marked the seized items
with their initials immediately upon confiscation. If at the first instance or opportunity, the
apprehending team did not mark the seized item/s, then there is nothing to identify it later on as it
passes from one hand to another.Notably, the testimonies of the prosecution witnesses failed to
identify the person who took custody of the seized item at the police station. Although the request
for laboratory examination was signed by P/Supt. Fegarido, the Chief of the District Drug
Enforcement Group, we cannot assume that he was the person who received the seized item from
PO1 Mengote, in the absence of any testimony proving such fact.
CESAR D. CASTRO v. PEOPLE OF THE PHILIPPINES

G.R. No. 193379, 15 August 2011, THIRD DIVISION, (Velasco, Jr., J)
The custodial chain would include testimony about every link in the chain or movements of the
illegal drug, from the moment of seizure until it is finally adduced in evidence.
The Intelligence and Operation Section of Laoag City Police Station received a phone call from
a concerned citizen that a male person wearing green t-shirt and brown maong bought shabu near
the Iglesia Ni Cristo. A team was dispatched to the area where they found Cesar Castro (Castro), a
known drug personality wearing a green t-shirt. Upon recognizing the police officers, Castro brought
something out from his pocket and threw it at his back. The things thrown by the accused were plastic
sachets of shabu, lighter and a coin. He could not answer when he was asked whether or not he had
authority to possess illegal drug. They brought the accused to the police station and he was indorsed
to Investigation Section.
The Regional Trial Court (RTC) found Castro guilty of violating Sec. 11, Art. II of RA 9165. The
Court of Appeals (CA) affirmed the judgment of the trial court. Hence, the petition.
ISSUE:
Whether or not the chain of custody of the alleged seized shabu has been established.
RULING:
YES. As a mode of authenticating evidence, the chain of custody rule requires that the
presentation and admission of the seized prohibited drug as an exhibit be preceded by evidence to
support a finding that the matter in question is what the proponent clams it to be. Ideally, the
custodial chain would include testimony about every link in the chain or movements of the illegal
drug, from the moment of seizure until it is finally adduced in evidence.
Record shows that the chain of custody rule has been sufficiently observed. The prosecution
had proved with moral certainty, thru the testimony of their key witnesses that what was seized from
Castro in the afternoon of July 25, 2003 near a church building in Laoag City was the very same item
presented in court after it was subjected to qualitative examination and was tested positive for
methamphetamine hydrochloride.
PEOPLE OF THE PHILIPPINES v. ADRIANO PASCUA y CONCEPCION

G.R. No. 194580, 31 August 2011, THIRD DIVISION (Velasco, Jr., J.)
RA 9165s IRR provides that non-compliance with the stipulated procedure, under justifiable
grounds, shall not render void and invalid such seizures of and custody over said items, for as long as
the integrity and evidentiary value of the seized items are properly preserved by the apprehending
officers. What is significant in the requirement is the preservation of the integrity and evidentiary value
of the seized items.
Adriano Pascua y Concepcion (Adriano) was charged with violation of Sec. 5, Art. II of
Republic Act No. (RA) 9165 or the Comprehensive Dangerous Drugs Act of 2002. During his
arraignment, Adriano pleaded not guilty. The Regional Trial Court (RTC) found the accused guilty of
the offense charged. It found that the evidence of the prosecution established the elements of illegal
sale of drugs as the accused was caught in flagrante delicto via a buy-bust operation. On the other
hand, the RTC noted that the defense merely offered denial as its defense while failing to overturn
the presumption of regularity in the performance of official duties accorded to the buy-bust team.
On appeal, Adriano averred that the trial court erred in finding him guilty beyond reasonable
doubt despite the prosecutions non-compliance with Sec. 21 of RA 9165 on the chain of custody of
seized drugs. He alleged that the prosecution failed to prove the integrity of the seized drug. He also
raised as error his conviction based solely on the testimony of Police Officer 1 Willie Tadeo (PO1
Tadeo).
The People, represented by the Office of the Solicitor General (OSG), countered that the
integrity and chain of custody of the seized item was duly established during the trial. It was further
argued that not all those who came into possession of the seized drugs have to be presented as a
witness as long as the chain of custody was not broken and the seized drugs were properly identified.
Moreover, the OSG argued that the failure of the prosecution to comply with Sec. 21 of RA 9165 did
not overcome the application of the presumption of regularity in the performance of regular duty
accorded to the police officers involved in the buy-bust operation. The OSG furthermore argued that
the defense of bare denial cannot be given greater evidentiary weight than the positive declarations
of the complainant. It added that no evidence was shown that the police officers in the buy-bust
operation had any ill motive to make false charges against the accused.
The Court of Appeals (CA) affirmed the ruling of the RTC.
ISSUES:
1. Whether Adriano is guilty beyond reasonable doubt despite the prosecution’s non-
compliance with RA 9165 on chain of custody of seized drugs.
2. Whether Adriano is guilty beyond reasonable doubt despite the prosecutions failure to
prove the integrity of the seized drug.
RULING:
1. YES. In every case of illegal sale of dangerous drugs, the prosecution is obliged to establish
the following essential elements: (1) the identity of the buyer and the seller, the object of the sale and
the consideration; and (2) the delivery of the thing sold and its payment. What is material is the proof
that the transaction or sale actually took place, coupled with the presentation in court of the corpus
delicti as evidence. The delivery of the illicit drug to the poseur-buyer and the receipt by the seller of
the marked money successfully consummate the buy-bust transaction.
The CA did not err in finding accused-appellant guilty beyond reasonable doubt. As the
records show, the identities of the buyer, PO1 Tadeo, and the seller, accused-appellant, were
established. The object of the sale, 0.084 gram of shabu, and the consideration, Php200, were likewise
adequately shown by the prosecution. There is also no question as to the delivery of the shabu sold
and the payment for it.
2. YES. Apart from establishing the elements in the illegal sale of drugs, it must further be
shown by the prosecution that the drugs seized and tested are the same as the corpus
delicti presented in court. In People v. Rosialda, we reiterated jurisprudence to the effect that leeway
is given to the prosecution as regards compliance with the chain of custody requirement. We have
previously underscored that RA 9165s IRR provides that non-compliance with the stipulated
procedure, under justifiable grounds, shall not render void and invalid such seizures of and custody
over said items, for as long as the integrity and evidentiary value of the seized items are properly
preserved by the apprehending officers.What is significant in the requirement is the preservation of
the integrity and evidentiary value of the seized items. Indeed, non-compliance with the provisions
of RA 9165 on the custody and disposition of dangerous drugs is not necessarily fatal to the
prosecutions case. Neither will it render the arrest of an accused illegal nor the items seized from her
inadmissible.
In the instant case, the chain of custody over the seized drugs was testified on by PO1 Tadeo.
After the buy-bust was completed, PO1 Tadeo marked the plastic sachet sold by accused-appellant
with the initials WCT. PO1 Michael Sarangaya, who arrested accused-appellants co-accused Carmelo,
marked the plastic sachet from Carmelo with MCS. A request for laboratory examination of the seized
items was made (Exhibit A). Afterwards, PO1 Tadeo personally brought the request and the seized
items to the PNP crime laboratory. The same specimens tested positive for shabu as evidenced in
Chemistry Report No. D-768-2003 (Exhibit B) and were subsequently presented during trial
(Exhibits C and C-1). As aptly shown by the prosecution, the chain of custody was shown to have been
unbroken in accordance with RA 9165 and its IRR.
PEOPLE OF THE PHILIPPINES v. LUIS PAJARIN y DELA CRUZ and EFREN PALLAYA y TUVIERA
G.R. No. 190640, 12 January 2011, SECOND DIVISION, (Abad, J)
Failure of the police to comply with the procedure laid down in R.A. 9165 would not render void
the seizure of the prohibited substance for as long as the apprehending officers give justifiable reason
for their imperfect conductand show that the integrity and evidentiary value of the confiscated items
had not been compromised.
Luis Pajarin (Pajarin) and Efren Pallaya (Pallaya) were charged with violation of Section 5 in
relation to Sections 26 and 11 (3) in relation to Section 13, respectively, of Article II of Republic Act
(R.A.) 9165 or the Comprehensive Dangerous Drugs Act of 2002. A buy bust operation was
conducted. Pajarin opened the compartment of his red scooter and took from it one heat-sealed
transparent plastic sachet containing a white crystalline substance. The police searched the red
scooter’s compartment and recovered another plastic sachet containing the same substance.
The Regional Trial Court (RTC) found both accused guilty of the crime charged and imposed
on them the penalty of life imprisonment and a fine of P500,000.00. On appeal to the Court of Appeals
(CA), the latter rendered a decision affirming the RTC decision.
ISSUE:
Whether or not Section 21 (a), Article II of the Implementing Rules and Regulations of R.A.
9165 was complied with.
RULING:
NO. Section 21 (a), Article II of the Implementing Rules and Regulations of R.A. 9165, requires
the immediate inventory of and photograph the seized item in the presence of the accused or his
representative or responsible third persons mentioned but always taking care that the integrity and
evidentiary value of the seized articles are preserved. The Court has held in numerous cases that the
failure of the police to comply with the procedure laid down in R.A. 9165 would not render void the
seizure of the prohibited substance for as long as the apprehending officers give justifiable reason
for their imperfect conduct and show that the integrity and evidentiary value of the confiscated items
had not been compromised.
Here, the prosecution failed to show that the substances allegedly seized from the accused
were the same substances presented in court to prove their guilt. Here, the police officers did not
mark the sealed plastic sachets to show that they were the same things they took from the
accused. Rather, the marking on the items were done by the station investigator who would have no
way of knowing that the substances were really seized from the accused. The marking of captured
items immediately after they are seized from the accused is the starting point in the custodial
link. This step is vital because succeeding handlers of the specimens will use the markings as
reference.
PEOPLE OF THE PHILIPPINES v. JACQUILINE PAMBID y CORTEZ

G.R. No. 192237, 26 January 2011, FIRST DIVISION, (Velasco, Jr., J)
Non-compliance with Sec. 21 of the IRR does not make the items seized inadmissible. What is
imperative is the preservation of the integrity and the evidential value of the seized items as the same
would be utilized in the determination of the guilt or innocence of the accused
On September 18, 2003, a confidential informant arrived at the Station Anti-Illegal Drugs,
Station 4, Novaliches, Quezon City. PO2 Collado, the poser buyer, proceeded to the house of alias Jack,
who was later identified as Pambid. Pambid gave PO2 Collado a plastic sachet containing white
crystalline substance.PO2 Collado introduced himself to Pambid as a policeman, recovered another
plastic sachet from her left hand, and arrested her. They then brought her to the station. After trial,
the Regional Trial Court (RTC) found Pambid guilty of violating Section 5 and Section 11, Article II of
R.A. No. 9165. On appeal, the Court of Appeals (CA) affirmed the judgment of the RTC.
ISSUE:
Whether or not the proper custody of seized dangerous drugs as provided under R.A. No.
9165 was complied with.
RULING:
YES. Section 21 of the Implementing Rules and Regulations of RA 9165 provides for the
Custody and Disposition of Confiscated, Seized and/or Surrendered Dangerous Drugs, Plant Sources
of Dangerous Drugs, Controlled Precursors and Essential Chemicals, Instruments/Paraphernalia
and/or Laboratory Equipment.Non-compliance with Sec. 21 of the IRR does not make the items
seized inadmissible. What is imperative is the preservation of the integrity and the evidential value
of the seized items as the same would be utilized in the determination of the guilt or innocence of the
accused.
In the instant case, the chain of custody can be easily established through the following link:
(1) PO2 Collado marked the seized sachets subject of the buy-bust with MBC, his own initials; (2) a
request for laboratory examination of the seized items marked MBC was signed by C/Supt. Wong; (3)
the request and the marked items seized were received by the PNP Crime Laboratory; (4) Chemistry
Report No. D-1007-03 confirmed that the marked items seized from accused-appellant were
methylamphetamine hydrochloride; and (5) the marked items were offered in evidence as Exhibits
B-1 and B-2.
Hence, it is clear that the integrity and the evidentiary value of the seized drugs were
preserved. The court finds no reason to overturn the findings of the trial court that the drugs seized
from accused-appellant were the same ones presented during trial. Accordingly, it is but logical to
conclude that the chain of custody of the illicit drugs seized from accused-appellant remains
unbroken, contrary to the assertions of accused-appellant
PEOPLE OF THE PHILIPPINES v. SEVILLANO DELOS REYES y LANTICAN

GR No. 181039, 31 January 2011, THIRD DIVISION, (Villarama, Jr., J)
It is fatal for the prosecution to fail to prove that the specimen submitted for laboratory
examination was the same one allegedly seized from the accused.
On October 16, 2002, the Los Baos Police Station, through SPO1 Camilo Palisoc (SPO1
Palisoc), received a tip from an informant that Sevillano Delos Reyes (Delos Reyes) was
selling shabu. Thus, Los Baos Police Chief Police Senior Inspector Raymond Perlado instructed PO2
Ortega and SPO1 Palisoc to conduct a buy-bust operation. SPO1 Palisoc, the designated poseur-buyer,
received an aluminum foil containing white crystalline substance. With the assistance of barangay
officials, they entered Delos Reyes’ house and recovered five plastic sachets of shabu on top of the
bed. Therafter, Delos Reyes was brought to the police station where he was detained. The Regional
Trial court (RTC) rendered judgment acquitting Delos Reyes for illegal possession of dangerous drugs
but found him guilty of illegal sale of dangerous drugs. The Court of Appeals (CA) affirmed the
decision of the RTC with modification as to his sentence.
ISSUE:
Whether or not Delos Reyes is guilty of illegal sale of dangerous drugs.
RULING:
NO. Section 21, paragraph 1, Article II of R.A. No. 9165 provides for the procedure in seizure
and custody of illegal drugs. Evident however from the records of the case is the fact that the
members of the buy-bust team did not comply with the procedure laid down in Section 21 of R.A. No.
9165. Although there were elected public officials from the barangay who were present during the
buy-bust operation, nothing in his testimony, nor in the facts stipulated by the parties shows that
there was physical inventory of the seized items or that there was photographing thereof in the
presence of Delos Reyes, his representative or counsel, a representative of media and the Department
of Justice, as required by Section 21 of R.A. No. 9165.
Here, the first link in the chain of custody starts with SPO1 Palisoc, the designated poseur-
buyer, to whom appellant allegedly handed over the shabu contained in an aluminum foil. The second
link is when SPO1 Palisoc marked the aluminum foil with SLD, then turned them over to PO2
Cabaluna.The third link is when PO2 Cabaluna delivered the specimen to the PNP Crime Laboratory
Service 4, together with a request for examination signed by P/Sr. Insp. Perlado. Records show and
parties stipulated that it was received by one PO1 Golfo, Jr. at the crime laboratory. The continuity of
the chain, however, becomes unclear after the evidence reached the hands of PO1 Golfo, Jr. as the
next part of the chain established by the prosecution already relates to the examination conducted
by P/Insp. Huelgas, the forensic chemist. The records are bereft of any proof from whom P/Insp.
Huelgas received the specimen she examined and where it was kept for safekeeping after the
examination was conducted up to the time it was presented in court.
Non-compliance by the apprehending/buy-bust team with Section 21 is not fatal. Mere

failure to comply with Section 21 will not render an accused’s arrest illegal or the items
seized/confiscated from him inadmissible. But what is of utmost importance is the preservation of
the integrity and the evidentiary value of the seized items, as the same would be utilized in the
determination of the guilt or innocence of the accused. This function in buy-bust operations is
performed by the chain of custody requirement which ensures that doubts concerning the identity
of the evidence are removed. Hence, in a long line of cases, we have considered it fatal for the
prosecution to fail to prove that the specimen submitted for laboratory examination was the same
one allegedly seized from the accused.
PEOPLE OF THE PHILIPPINES v. RUFINO VICENTE, JR. y CRUZ

G.R. No. 188847, 31 January 2011, FIRST DIVISION, (Velasco Jr., J)
Non-compliance with the procedural requirements under RA 9165 and its IRR relative to the
custody, photographing, and drug-testing of the apprehended persons is not a serious flaw that can
render void the seizures and custody of drugs in a buy-bust operation.
On May 31, 2003, an informant arrived at the District Anti-Illegal Drugs at the Southern Police
District, Fort Bonifacio, Taguig, Metro Manila. The informant reported that a certain Paks was
pushing shabu on P. Mariano St., Ususan, Taguig, Metro Manila. PO2 Boiser proceeded to Ususan
accompanied by the informant. Once there, the informant pointed Paks to PO2 Boiser. They were at
a distance of 10 meters when they both saw Paks peddling drugs to several persons. After confirming
the informants report, they went back to the police station to recount what they had seen to P/Insp.
Anicoche. Thereafter, a team was dispatched to conduct a buy-bust operation. Paks, satisfied that
PO2 Boiser was indeed a drug user, agreed to sell PhP 500 worth of shabu. Paks was then arrested
and detained. The Regional Trial court Found Vicente, Jr. guilty of violating Section 5, 1 st paragraph,
Article II of RA 9165. The Court of Appeals affirmed the findings of the trial court.
ISSUE:
Whether or not Vicente Jr. is guilty of violating RA 9165.
RULING:
YES. Sec. 21 of RA 9165 need not be followed as an exact science. Non-compliance with Sec.
21 does not render an accused’s arrest illegal or the items seized/confiscated from him inadmissible.
Non-compliance with the procedural requirements under RA 9165 and its IRR relative to the custody,
photographing, and drug-testing of the apprehended persons is not a serious flaw that can render
void the seizures and custody of drugs in a buy-bust operation. We have thus emphasized that what
is essential is the preservation of the integrity and the evidentiary value of the seized items, as the
same would be utilized in the determination of the guilt or innocence of the accused.
Any doubts as to the chain of custody requirement were clarified during the cross-
examination of PO2 Boiser. Prosecutions involving illegal drugs depend largely on the credibility of
the police officers who conducted the buy-bust operation.Oft-repeated is the rule that in cases
involving violations of the Comprehensive Dangerous Drugs Act, credence is given to prosecution
witnesses who are police officers for they are presumed to have performed their duties in a regular
manner, unless there is evidence to the contrary. Absent any indication that the police officers were
ill-motivated in testifying against the accused, full credence should be given to their testimonies.
PEOPLE OF THE PHILIPPINES v. ERLINDA CAPUNO y TISON

The presumption of regularity in the performance of official duties obtains only when nothing
in the records suggests that the law enforcers involved deviated from the standard conduct of official
duty as provided for in the law. But where the official act in question is irregular on its face, an adverse
presumption arises as a matter of course.
Erlinda Capuno y Tison (Capuno) was charged of illegal sale of shabu, under Section 5, Article
II of Republic Act (R.A.) No. 9165 or the Comprehensive Dangerous Drugs Act of 2002. The prosecution
presented Police Officer 1 (PO1) Jose Gordon Antonio and PO1 Fortunato Jiro III at the trial while
Capuno and Maria Cecilia Salvador took the witness stand for the defense. Capuno denied that she
had been selling illegal drugs. She likewise contends that the prosecution failed to show an unbroken
chain of custody in the handling of the seized specimen. She claims that the apprehending team did
not mark the seized items upon confiscation. Moreover, there was no showing that the police
inventoried or photographed the seized items in her presence or her counsel, a representative of the
media and the Department of Justice (DOJ), and any elected public official.
The Regional Trial Court (RTC) found Capuno guilty. The Court of Appeals (CA) affirmed.
Hence, the petition.
ISSUE:
Whether or not Capuno was correctly found guilty.
RULING:
NO. To remove any doubt or uncertainty on the identity and integrity of the seized drug,
evidence must definitely show that the illegal drug presented in court is the same illegal drug actually
recovered from the appellant; In the present case, the procedure bodied in Section 21, paragraph 1,
Article II of R.A. No. 9165, however, was not shown to have been complied with by the members of
the buy-bust team, and nothing on record suggests that they had extended reasonable efforts to
comply with the said statutory requirement in handling the evidence. From the testimonies of the
police officers, it is clear that the apprehending team, upon confiscation of the drug, immediately
brought the appellant and the seized specimen to the police station. No physical inventory and
photograph of the seized items were taken in the presence of the appellant or her counsel, a
representative from the media and the DOJ, and an elective official.
In sustaining Capuno’s conviction, the CA relied on the evidentiary presumption that official
duties have been regularly performed. This presumption obtains only when nothing in the records
suggests that the law enforcers involved deviated from the standard conduct of official duty as
provided for in the law. But where the official act in question is irregular on its face, as in this case,
an adverse presumption arises as a matter of course.
Sufficiency of Evidence
PEOPLE OF THE PHILIPPINES v. ROLANDO LAYLO y CEPRES

The elements necessary for the prosecution of illegal sale of drugs are: a) identity of the buyer
and seller, object, and consideration; and b) delivery of the thing sold and the payment.
Two separate information against Rolando Laylo y Cepres (Laylo) and Melitona Ritwal
(Ritwal) were filed before Regional Trial Court (RTC) for attempted sale of illegal drugs. Both pleaded
not guilty. The prosecution presented two witnessess: PO1 Angelito Reyes and PO1 Gem Pastor, the
poseur-buyer in the attempted sale of illegal drugs. The prosecution claimed that while the police
officers were in front of a sari- sari store, Laylo and Ritwal approached them and asked if they want
shabu. PO1 Reyes asked them if they have it. Laylo then brought out two plastic bags containing shabu
and told the officers that it costs P200 per plastic. Upon hearing this, PO1 Reys and PO1 Pastor
introduced themselves as cops and immediately arrested Laylo. Ritwal tried to get away but was
frisked by PO1 Pastor. The latter found another sachet of shabu. The officers marked the three plastic
sachets of shabu recovered and forwarded them to the Philippine National Police Crime Laboratory
for forensic testing. Forensic Chemist Police Inspector found the recovered items positive for shabu.
The defense, on the other hand, presented Laylo and his three neighbors. According to them, Laylo
and Ritwal were walking on the streets when two men grabbed them. They were dragged to a house
and two plastic sachets of shabu were placed in their pockets. Thereafter, Laylo and Ritwal were
brought to police station where, despite protests claims that drugs were planted, they were arrested
and charged.
The Regional Trial Court (RTC) found Laylo and Ritwal guilty beyond reasonable doubt giving
credence to the testimonies of police officers, who were presumed to have performed their duties in
a regular manner. The Court of Appeals (CA) affirmed the decision of the RTC. Hence, the petition.
ISSUE:
Whether or not there is enough evidence to sustain the prosecution of illegal sale of
dangerous drugs.
RULING:
YES. The elements necessary for the prosecution of illegal sale of drugs are: a) identity of the
buyer and seller, object, and consideration; and b) delivery of the thing sold and the payment. In the
present case, PO1 Reyes narrated the circumstances of the illegal sale which was corroborated by
testimony of PO1 Pastor. From the testimonies given, PO1 Reyes and PO1 Pastor identified
themselves as poseur- buyers in the sale. Both positively identified Laylo as the seller of the substance
contained in sachets which were found to be positive for shabu. The same sachets were identified by
the prosecution witnesses when presented in court. The consideration of P200 per sachet had been
made known by Laylo to the officers. However, the sale was interrupted when officers introduced
themselves as cops. Thus, the sale was not consummated but merely attempted. From the
testimonies, the prosecution was able to establish that there was attempt to sell shabu. Therefore,
the elements of crime charged were sufficiently established by evidence.
PEOPLE OF THE PHILIPPINES v. ANDREW ROBLE

G.R. No. 192188, 11 April 2011, FIRST DIVISION (Velasco, Jr., J.)
While a buy-bust operation is legal and has been proved to be an effective method of
apprehending drug peddlers, due regard to constitutional and legal safeguards must be undertaken.
A buy-bust operation was conducted in Looc, Danao City wherein Andrew Roble (Roble)
feloniously sold and delivered two plastic packets containing shabu. City Prosecutor
DamancioSuralta (Suralta) issued a resolution, filing information against Roble.
The prosecution presented witnesses attesting to guilt of the accused. Meanwhile, Robles
defended that he was not in Looc when the buy-bust operation occurred.
The Regional Trial Court (RTC) convicted Roble of the crime charged against him. The Court
of Appeals (CA) affirmed the decision.
Upon appeal to the Supreme Court, Roble contends that the CA erred in finding that the
assessment by the trial court of the credibility of the witnesses and their testimonies deserves great
respect and remaining unconvinced that the lower court overlooked any important fact or
misapprehended any relevant information, which will properly negate or erode its assessment that
he is guilty of the crime charged against him.
ISSUE:
Whether or not the contentions of Roble is meritorious.
RULING:
YES. It is hornbook doctrine that the evaluation of the trial court of the credibility of the
witnesses and their testimonies is entitled to great weight and is generally not disturbed upon appeal.
However, such rule does not apply when the trial court has overlooked, misapprehended, or
misapplied any fact of weight or substance. In the instant case, circumstances are present that, when
properly appreciated, would warrant the acquittal of Roble.
In the instant case, the prosecution has failed to prove all the elements of the crime with moral
certainty. A careful perusal of the testimony of PO2 Laurel readily reveals that there is serious doubt
as to the identity of the seller. In his testimony, PO2 Laurel stated that when the transaction took
place at 6:30 p.m., he was inside a parked tricycle located seven (7) meters away from where the
transaction took place. Significantly the transaction occurred behind a store and not along the road.
Add to this the fact that it happened at dusk, making it harder to see. Considering all these, it is,
therefore, highly improbable that PO2 Laurel actually saw accused-appellant. In fact, he testified that
the poseur-buyer approached a certain person and that he only assumed it was accused-appellant to
whom the poseur-buyer was talking. Clearly, PO2 Laurels testimony cannot establish with moral
certainty the identity of the seller. It baffled this Court why the prosecution did not present the
poseur-buyer as he would be the best person to identify the identity of the seller. No justifiable reason
was submitted as to why Cuizons testimony could not be presented.
Even more doubtful is the identity and integrity of the dangerous drug itself. In prosecutions
for illegal sale of dangerous drugs, the existence of dangerous drugs is a condition sine qua non for
conviction. Thus, it must be established that the substance bought during the buy-bust operation is
the same substance offered in court. The chain of custody requirement performs this function in that
it ensures that unnecessary doubts concerning the identity of the evidence are removed.
Judicial Admission
LANDOIL RESOURCES CORPORATION v. AL RABIAH LIGHTING COMPANY

It is well-settled that judicial admissions cannot be contradicted by the admitter who is the party
himself and binds the person who makes the same, and absent any showing that this was made thru
palpable mistake, no amount of rationalization can offset it.
Al Rabiah entered into a Sub-Contract Agreement wherein it was assigned to carry out the
electrical works of Kuwait Oil Company's project in Ahmadi, Kuwait. Later, the project owner had
withdrawn the principal contract which led to the termination of Landoil’s and CCI’s
services. Consequently, Al Rabiah's works were stopped before completion. Later, Landoil sent a
letter to Al Rabiah acknowledging its indebtedness to the latter for unpaid completed works.
However, as Landoil failed to pay any part of the amount due, the dispute was referred to the
Commercial Kully Court of Kuwait for arbitration which awarded in favour of Al Rabiah. Thereafter,
the latter filed with the Regional Trial Court (RTC) an action for Enforcement of Foreign Judgment
Plus Damages against CCI and Landoil.
In its Answer, Landoil admitted the existence of the Sub-Contract Agreement, but claimed to
have no knowledge as to its genuineness and due execution. By way of Special and Affirmative
Defenses, it argued among others that Al Rabiah had no cause of action; and that since it had not been
paid by its principal contractor the value of the corresponding accomplishments done by Al Rabiah,
the latter’s cause of action had not yet accrued.
After trial, the RTC rendered its Decision in favour of Al Rabiah, holding CCI and Landoil
solidarily laible. On appeal, the Court of Appeals (CA) affirmed the RTC decision. The CA ruled, among
others, that Landoil was already estopped from claiming that it was not a party to the Sub-Contract
Agreement. The CA denied the motion for reconsideration. Hence, this petition.
ISSUE:
Whether or not a Philippine Court, in enforcing a foreign judgment that has become final and
executory, has the jurisdiction to alter, amend or expand such final foreign judgment;
RULING:
YES. We are not convinced with Landoil’s contention that as appearing in the dispositive
portion of the foreign arbitral award, there is only one defendant adjudged liable to Al Rabiah, i.e.,
Land Oil Resources Company (Construction Consortium Incorporation); thus, the party against
whom the Writ of Execution may be directed. It claims that it is not the same as Land Oil Resources
Company; that it was not a party to the proceedings before the foreign arbitrator as it is a different
entity.It avers that the RTC and the CA erred and committed grave abuse of discretion in amending
and modifying the foreign arbitral award so as to include it which is a corporation different from the
entity adjudged liable in the foreign arbitral award.
The CA correctly found, Landoil’s argument that the party adjudged liable under the foreign
arbitral award was a different entity from it was only raised for the first time in Landoil’s motion for
reconsideration filed with it; thus, could not be entertained.
Likewise, in its appeal brief, it also acknowledged being the defendant against whom the
arbitral award was being enforced. Indeed, Landoil had never claimed in the RTC that it was not
the party referred to in the foreign arbitral award. Moreover, in its Memorandum filed with the RTC,
it again made admission that it was the party referred to in the foreign arbitral award. It is well-
settled that judicial admissions cannot be contradicted by the admitter who is the party himself and
binds the person who makes the same, and absent any showing that this was made thru palpable
mistake, no amount of rationalization can offset it.
REPUBLIC OF THE PHILIPPINES, represented by the Chief of the Philippine National Police v.
THI THU THUY T. DE GUZMAN
A party who judicially admits a fact cannot later challenge that fact as judicial admissions are
a waiver of proof; production of evidence is dispensed with. A judicial admission also removes an
admitted fact from the field of controversy. Consequently, an admission made in the pleadings cannot
be controverted by the party making such admission and are conclusive as to such party, and all proofs
to the contrary or inconsistent therewith should be ignored, whether objection is interposed by the party
or not. The allegations, statements or admissions contained in a pleading are conclusive as against the
pleader. A party cannot subsequently take a position contrary of or inconsistent with what was pleaded.
Thi Thu Thuy T. De Guzman (De Guzman) is the proprietress of Montaguz General
Merchandise (MGM), a contractor accredited by the Philippine National Police (PNP) for supply of
office and construction materials and equipment. The PNP Engineering Services released a
reacquisition and issue vouchers for the acquisition of various building materials. MGM and PNP
executed a contract of agreement wherein PNP procured construction materials from MGM. MGM
delivered the said materials, however, PNP did not pay. De Guzman through his counsel demanded
the payment from PNP for the construction materials it procured in favor of PNP.
PNP replied, informing the counsel of the payment made to MGM via check. De Guzman
reiterated the demand and denying that he received the check. De Guzman filed a complaint for
collection for sum of money against the PNP. The PNP filed a motion to dismiss. PNP’s counsel, Atty.
Bueno made a testimony in court stating, “Your Honor, in order to expedite the trial, we will admit
that this witness was contracted to deliver the construction supplies or materials. We will admit that
she complied, that she actually delivered the materials. We will admit that Land Bank Corporation
check was issued although we will not admit that the check was not released to her, as a matter of
fact, we have the copy of the check. We will admit that Warrant Register indicated that the check was
released although we will not admit that the check was not received by the De Guzman.”
Regional Trial Court (RTC) rendered a decision in favor of De Guzman due to the admissions
made by PNP’s counsel. The Court of Appeals (CA) affirmed the decision of the lower court upon
appeal.
ISSUE:
Whether or not the judicial admissions made by the lawyer of PNP can be admitted as
evidence in the case.
RULING:
YES. A party who judicially admits a fact cannot later challenge that fact as judicial admissions
are a waiver of proof; production of evidence is dispensed with. A judicial admission also removes an
admitted fact from the field of controversy. Consequently, an admission made in the pleadings cannot
be controverted by the party making such admission and are conclusive as to such party, and all
proofs to the contrary or inconsistent therewith should be ignored, whether objection is interposed
by the party or not. The allegations, statements or admissions contained in a pleading are conclusive
as against the pleader. A party cannot subsequently take a position contrary of or inconsistent with
what was pleaded.
PNP admitted to the existence and validity of the Contract of Agreement executed between
the PNP and MGM, as represented by De Guzman, on December 11, 1995. It likewise admitted that
MGM delivered the construction materials subject of the Contract, not once, but several times during
the course of the proceedings. The only matter PNP assailed was De Guzman’s allegation that she had
not yet been paid. If Cruz’s testimony were true, the petitioner should have put respondent in her
place the moment she sent a letter to the PNP, demanding payment for the construction materials
she had allegedly delivered. Instead, PNP replied that it had already paid respondent as evidenced by
the LBP check and the receipt she supposedly issued. This line of defense continued on, with the
petitioner assailing only the respondent’s claim of nonpayment, and not the rest of respondent’s
claims, in its motion to dismiss, its answer, its pre-trial brief, and even in open court during the
respondent’s testimony.
PNP’s admissions were proven to have been made in various stages of the proceedings, and
since De Guzman has not shown us that they were made through palpable mistake, they are
conclusive as to the petitioner. Hence, the only question to be resolved is whether the PNP was paid
under the December 1995 Contract of Agreement. The RTC and the CA correctly ruled that PNP’s
obligation has not been extinguished. Its obligation consists of payment of a sum of money. In order
for PNP’s payment to be effective in extinguishing its obligation, it must be made to the proper
person.
Best Evidence Rule
RICO ROMMEL ATIENZA v. BOARD OF MEDICINE and EDITHA SIOSON

That the two kidneys of Editha were in their proper anatomical locations at the time she was
operated on, is presumed under Section 3, Rule 131 of the Rules of Court. Biology, include the structural
make-up and composition of living things such as human beings which the court may take judicial
notice.
Editha Sioson (Editha) went to Rizal Medical Center for check-up due to her lumbar pains.
The tests revealed that her right kidney is normal. It was ascertained, however, that her left kidney
is non-functioning and non-visualizing. Thus, she underwent kidney operation. Romeo Sioson
(Romeo) filed a complaint for gross negligence and/or incompetence before the BOM against the
doctors, which includes Rico Rommel Atienza (Atienza), who allegedly participated in the fateful
kidney operation. It was alleged in the complaint that the gross negligence and/or incompetence
committed by the said doctors, consists of the removal of fully functional right kidney, instead of the
left non-functioning and non-visualizing kidney. The complaint was heard by the Board of Medicine
(BOM). After complainant Romeo presented his evidence, Editha Sioson, filed her formal offer of
documentary evidence. Attached to the formal offer of documentary evidence are her Exhibits A to D
which consists of certified photocopy of the X-ray Request, which she offered for the purpose of
proving that her kidneys were both in their proper anatomical locations at the time she was operated.
Rico Rommel Atienza filed his comments/objections to EdithaSioson’s formal offer of

exhibits. He alleged that said exhibits are inadmissible because the same are mere photocopies, not
properly identified and authenticated, and intended to establish matters which are hearsay. He added
that the exhibits are incompetent to prove the purpose for which they are offered.
ISSUES:
1. Whether or not the rules of evidence are strictly applied before the BOM.
2. Whether or not the Best Evidence Rule applies
3. Whether or not the exhibits constitute a hearsay evidence
RULING:
1. NO. It is well-settled that the rules of evidence are not strictly applied in proceedings before
administrative bodies such as the BOM. Further, the admission of the exhibits did not prejudice the
substantive rights of Atienza because, at any rate, the fact sought to be proved thereby, that the two
kidneys of Editha were in their proper anatomical locations at the time she was operated on, is
presumed under Section 3, Rule 131 of the Rules of Court. Unquestionably, the rules of evidence are
merely the means for ascertaining the truth respecting a matter of fact. Thus, they likewise provide
for some facts which are established and need not be proved, such as those covered by judicial notice,
both mandatory and discretionary. Laws of nature involving the physical sciences, specifically
biology, include the structural make-up and composition of living things such as human beings. In
this case, we may take judicial notice that Edithas kidneys before, and at the time of, her operation,
as with most human beings, were in their proper anatomical locations.
2. NO. The subject of inquiry in this case is whether respondent doctors before the BOM are
liable for gross negligence in removing the right functioning kidney of Editha instead of the left non-
functioning kidney, not the proper anatomical locations of Edithas kidneys. As previously discussed,
the proper anatomical locations of Edithas kidneys at the time of her operation at the RMC may be
established not only through the exhibits offered in evidence. In fact, the introduction of secondary
evidence, such as copies of the exhibits, is allowed. Witness Dr. Nancy Aquino testified that the
Records Office of RMC no longer had the originals of the exhibits because it transferred from the
previous building, x xx to the new building. Ultimately, since the originals cannot be produced, the
BOM properly admitted Editha’s formal offer of evidence and, thereafter, the BOM shall determine
the probative value thereof when it decides the case.
3. NO. These exhibits do not constitute hearsay evidence of the anatomical locations of
Editha’s kidneys. To further drive home the point, the anatomical positions, whether left or right, of
Editha’s kidneys, and the removal of one or both, may still be established through a belated
ultrasound or x-ray of her abdominal area.
Extrajudicial Confession
PEOPLE OF THE PHILIPPINES v. RODOLFO CAPITLE and ARTURO NAGARES

G.R. No. 175330, 12 January 2011, SECOND DIVISION, (Carpio,J)
Extra-judicial confession accompanied by photographs taken during the signing,

thumbmarking, and swearing of the extrajudicial confession is admissible in evidence.
Barangay Chairman Avelino Pagalunan (Pagalunan) was gunned down by four men. On
September 29, 1993, Arturo Nagares was apprehended by the Pasig Police on account of his
conviction in another case for Frustrated Homicide. On September 30, 1993, Ruiz Constantino
(Constantino) gave his statement identifying Arturo Nagares (Nagares) from the four pictures
presented to him as one of the three armed assailants of Pagalunan. On October 19, 1993, while under
detention at the NBI, Nagares executed an extrajudicial confession to the killing of Pagalunan.
Witness Solomon Molino (Molino) identified Ramil Marquina (Marquina) in a police line-up.
He also gave a written statement before the Pasig Police identifying Rodolfo Capitle (Capitle). A
criminal charge sheet for Murder was filed against Capitle, Nagares and Marquina. The Regional Trial
Court (RTC) rendered a decision finding Capitle and Nagares guilty as charged, while acquitting
Marquina. On appeal, the Court of Appeals (CA) affirmed the trial court’s decision. Hence, the petition.
ISSUE:
Whether or not Nagares’ extra-judicial confession is admissible in evidence
RULING:
YES. Based on the records, Nagares extrajudicial confession was voluntarily given, and thus
admissible. As found by the Court of Appeals, (1) there is no evidence of compulsion or duress or
violence on the person of Nagares; (2) Nagares did not complain to the officers administering the
oath during the taking of his sworn statement; (3) he did not file any criminal or administrative
complaint against his alleged malefactors for maltreatment; (4) no marks of violence were observed
on his body; and (5) he did not have himself examined by a physician to support his claim.
Likewise negating Nagares claim of a coerced confession are the photographs taken during
the signing, thumbmarking, and swearing of the extrajudicial confession. All the pictures depicted a
cordial and pleasant atmosphere devoid of any sign of torture, threat, duress or tension on Nagares
person. In fact, the photographs showed Nagares smiling.Further, the records show that Nagares was
duly assisted by an effective and independent counsel during the custodial investigation in the NBI.
Hearsay
SOCIAL SECURITY COMMISSION AND SOCIAL SECURITY SYSTEM v. TERESA G. AVILA

Mere allegation is not evidence and is not equivalent to proof. Charges based on mere suspicion and
speculation likewise cannot be given credence. Mere uncorroborated hearsay or rumor does not constitute
substantial evidence.
Teresa G. Favila (Teresa) filed a Petition befiore Social Security Commission (SSC), averring
that after she was married to Florante Favila (Florante) and the latter designated her as the sole
beneficiary in the E-1 Form he submitted before Social Security System (SSS). When they begot their
children, her husband likewise designated each one of them as beneficiaries. Teresa further averred
that when Florante died, his pension benefits under the SSS were given to their only minor child at
that time, but only until his emancipation at age 21. Believing that as the surviving legal wife she is
likewise entitled to receive Florantes pension benefits, Teresa subsequently filed her claim for said
benefits before the SSS. The SSS, however, denied the claim. SSS averred that the claim for Florante’s
pension benefits was initially settled in favor of Teresa as guardian of the minor child. Teresa was
paid the monthly pension for a total period of 57 months when the minor child reached the age of
21. The claim was, however, re-adjudicated and the balance of the five-year guaranteed pension was
again settled in favor of child. SSS also alleged that the sister of Florante wrote a letter stating that
her brother had long been separated from Teresa. She alleged therein that the couple lived together
for only ten years and then decided to go their separate ways because Teresa had an affair with a
married man with whom, as Teresa herself allegedly admitted, she slept with four times a week. SSS
also averred that an interview conducted in Teresa’s neighborhood revealed that although she did
not cohabit with another man after her separation with Florante, there were rumors that she had an
affair with a police officer. To support Teresas non-entitlement to the benefits claimed, SSS cited the
provisions of Sections 8(k) and 13 of Republic Act (RA) No. 1161, as amended otherwise known as
Social Security (SS) Law.
ISSUE:
Whether or not the allegation that Teresita had an affair with another man should be given
credence to prove the latter’s non-entitlement to death benefits.
RULING:
NO. The basic rule is mere allegation is not evidence and is not equivalent to proof. Charges
based on mere suspicion and speculation likewise cannot be given credence. Mere uncorroborated
hearsay or rumor does not constitute substantial evidence.
In this case, the Court agrees Teresa that her alleged affair with another man was not
sufficiently established. The Memorandum of SSS Senior Analysts Liza Agilles and Jana Simpas
reveals that it was Florante who was in fact living with a common law wife and their three minor
children at the time of his death. Susan even filed her own claim for death benefits with the SSS but
same was, however, denied. While SSC believes that the foregoing constitutes substantial evidence of
Teresa’s amorous relationship, we, however, find otherwise. It is not hard to see that the claim of
Teresa’s cohabitation with a married man is a mere allegation without proof. Likewise, the interviews
conducted by SSS revealed rumors only that Teresa had an affair with a certain police officer. Notably,
not one from those interviewed confirmed that such an affair indeed existed. With respect to Teresa,
there is not enough proof to establish Teresa’s alleged relationship with another man since they did
not live as husband and wife.
Previous Conduct as Evidence
METROPOLITAN BANK AND TRUST COMPANY v. MARINA B. CUSTODIO

G.R. No. 173780, March 21, 2011, THIRD DIVISION (Sereno, J.)
Evidence that one did or did not do a certain thing at one time is not admissible to prove that
one did or did not do the same or a similar thing at another time.
Marina Custodio (Custodio) is a bank teller employed at Metropolitan Bank and Trust
Company (Metrobank). The latter however filed a complaint for a sum of money for the cash shortage
allegedly committed by Custodio. Aside from presenting evidence which will prove the alleged act,
Metrobank also argues that respondent Custodio’s prior involvement in a cash shortage in its Cubao
branch is admissible as evidence to prove a scheme or habit on her part. The trial court ruled in favor
of Metrobank but the same was reversed by the Court of Appeals (CA). Hence, the petition.
ISSUE:
Whether or not Custodio’s prior involvement in a cash shortage in another branch

conclusively proves her responsibility for the loss.
RULING:
NO. The general evidentiary rule is that evidence that one did or did not do a certain thing at
one time is not admissible to prove that one did or did not do the same or a similar thing at another
time. However, evidence of similar acts may be received to prove a specific intent or knowledge,
identity, plan system, scheme, habit, custom or usage and the like. Evidence of similar acts may
frequently become relevant, especially to actions based on fraud and deceit, because it sheds light on
the state of mind or knowledge of a person; it provides insight into such person's motive or intent; it
uncovers a scheme, design or plan, or it reveals a mistake.
In this case however, respondent Custodios prior involvement in a cash shortage in

Metrobank’s another branch does not conclusively prove that she is responsible for the loss of
PhP600,000 in the present branch. Although the previous cash shortage in Cubao could possibly shed
light on the intent, scheme or habit of respondent Custodio, that previous cash shortage is not
sufficient to affirm a definitive finding of fact that she took the funds in the Laoag City branch. If the
prior cash shortage in Cubao showed a reasonable intent or habit on the part of respondent, then
there was no reason for petitioner Metrobank to continue to employ her, considering the degree of
trust and confidence required of a bank teller. Nevertheless, respondent Custodio continued to serve
the bank even after the case in petitioner Metrobank’s Cubao branch. Her continued employment was
an affirmation that she was still worthy of the bank’s trust, insofar as she was allowed to continue to
handle sums of money in the Laoag City branch.
Res Gestae
PEOPLE OF THE PHILIPPINES v. ROMY FALLONES Y LABANA

G.R. No. 190341, March 16, 2011, THIRD DIVISION (Abad, J.)
For spontaneous statements to be admitted in evidence, the following must concur: 1) the
principal act, the res gestae, is a startling occurrence; 2) the statements were made before the declarant
had time to contrive or devise; and 3) the statements concerned the occurrence in question and its
immediately attending circumstances.
Romy Fallones y Labana (Fallones) was charged with rape. Alice was a retardate, but died
while the trial was ongoing thus she was unable to testify. Alice’s sister, Amalia, testified that her
mother told Alice, to look for their brother. Since their brother arrived without Alice, her mother
asked Amalia to look for her. Amalia looked in places where they often played and this led her near
Fallones’ house. Amalia heard someone crying out from within, “Tama na, tama
na!” Recognizing Alice’s voice, Amalia repeatedly knocked on the door until Fallones opened
it. Amalia saw her sister standing behind him. As Amalia went in to take her sister out, Alice held out
a sanitary napkin and, crying, said that Fallones had given her the napkin. Alice’s shorts were wet and
blood-stained. On their way home, Alice recounted to Amalia that Fallones brought her to his
bathroom, pulled down her shorts, and ravished her. She said that Fallones wet her shorts to make it
appear that she tripped and had her monthly period. Along the way, they met an uncle and told him
what happened. On their arrival, their father brought Alice to the barangay while Amalia returned to
Fallones house where she saw her uncle, some relatives, and neighbors accosting and beating
Fallones. Shortly after, some barangay officials arrived and intervened. Fallones, on the other hand,
denied the accusations. Fallones was found guilty of simple rape.
ISSUE:
Whether or not the spontaneous utterances during and after the incident of rape is admissible
in evidence.
RULING:
YES. Res gestae refers to statements made by the participants or the victims of, or the
spectators to, a crime immediately before, during, or after its commission. These statements are a
spontaneous reaction or utterance inspired by the excitement of the occasion, without any
opportunity for the declarant to fabricate a false statement. An important consideration is whether
there intervened, between the occurrence and the statement, any circumstance calculated to divert
the mind and thus restore the mental balance of the declarant; and afford an opportunity for
deliberation. For spontaneous statements to be admitted in evidence, the following must concur: 1)
the principal act, the res gestae, is a startling occurrence; 2) the statements were made before the
declarant had time to contrive or devise; and 3) the statements concerned the occurrence in question
and its immediately attending circumstances.
Here, the Court considers a res gestae Amalia’s recital of what she heard Alice utter when she
came and rescued her and Fallones’ act of forcing himself into Alice is a startling event. And Amalia
happened to be just outside his house when she heard Alice cry out “tama na, tama na!” When
Fallones opened the door upon Amalia’s incessant knocking, Alice came out from behind him,
uttering “Amalia, may napkin na binigay si Romy o.” The admissibility of Alice’s spontaneous
statements rests on the valid assumption that they were spoken under circumstances where there
had been no chance to contrive. It is difficult to lie in an excited state and the impulsiveness of the
expression is a guaranty of trustworthiness.
Deposition at a Former Proceeding
REPUBLIC OF THE PHILIPPINES v. SANDIGANBAYAN (FOURTH DIVISION), et al.

G.R. No. 152375,16 December 2011, EN BANC (BRION, J.)
Before a party can make use of the deposition taken at the trial of a pending action, Section 4,
Rule 23 of the Rules of Court does not only require due observance of its sub-paragraphs (a) to (d); it
also requires, as a condition for admissibility, compliance with the rules on evidence. Thus, even Section
4, Rule 23 of the Rules of Court makes an implied reference to Section 47, Rule 130 of the Rules of Court
before the deposition may be used in evidence.
Republic of the Philippines, through the Presidential Commission on Good Government

(PCGG), filed a complaint against Jose L. Africa, Manuel H. Nieto, Jr., Ferdinand E. Marcos, Imelda R.
Marcos, Ferdinand R. Marcos, Jr., Juan Ponce Enrile, and Potenciano Ilusorio (Ilusorio, et. al)
for reconveyance, reversion, accounting, restitution, and damages before the Sandiganbayan (Civil
Case No. 0009, the main case). It was alleged that Ilusorio, et. al illegally manipulated the purchase of
the major shareholdings of Cable and Wireless Limited in Eastern Telecommunications Philippines,
Inc. (ETPI), which shareholdings Jose Africa and Manuel Nieto, Jr. held for themselves and, through
their holdings and the corporations they organized, beneficially for Ferdinand E. Marcos and Imelda
R. Marcos. Victor Africa (Africa), son of the late Jose L. Africa, was not impleaded in and so is plainly
not a party to the main case. Civil Case No. 0009 spawned numerous incidental cases, among them,
Civil Case No. 0130. The present respondents were not made parties either in Civil Case No. 0130.
The PCGG filed a Very Urgent Petition for Authority to Hold Special Stockholders Meeting for
[the] Sole Purpose of Increasing [ETPIs] Authorized Capital Stock. In the proceedings to resolve the
Urgent Petition, the testimony of Mr. Maurice V. Bane (former director and treasurer-in-trust of ETPI)
was taken by way of deposition upon oral examination. The notice of deposition-taking also states
that the PCGG shall use the Bane deposition in evidence in the main case. On the scheduled deposition
date, only V. Africa was present and he cross-examined Bane. During the trial of the main case, PCGG
filed a motion to admit Bane’s deposition as evidence but it was denied by the Sandiganbayan on
April 1, 1998on the ground that the witnesses, whose testimony in the incident cases is sought to be
adopted, are not available for cross-examination in the Sandiganbayan. PCGG did not in any way
question the resolution, and instead made its Formal Offer of Evidence. Significantly, the Bane
deposition was not included as part of its offered exhibits. Rectifying the omission, PCGG filed
an Urgent Motion and/or Request for Judicial Notice which was again denied. The respondents
thereafter separately filed their respective demurrers to evidence. PCGG filed another motion to
Admit Supplemental Offer of Evidence (Re: Deposition of Maurice Bane) but it was again denied. The
Sandiganbayan ratiocinated that its 1998 resolution has become final in view of plaintiffs failure to
file any motion for reconsideration or appeal within the 15-day reglementary period. Hence, this
petition for certiorari.
ISSUE:
Whether the Bane deposition is admissible
RULING:
NO. The consolidation of Civil Case No. 0009 and Civil Case No. 0130 did not dispense with
the usual requisites of admissibility since this was a type of consolidation for trial. There is nothing
in the records that would even suggest that the Sandiganbayan in fact intended a merger of causes of
action, parties and evidence.
Also, before a party can make use of the deposition taken at the trial of a pending action,
Section 4, Rule 23 of the Rules of Court does not only require due observance of its sub-paragraphs
(a) to (d); it also requires, as a condition for admissibility, compliance with the rules on
evidence. Thus, even Section 4, Rule 23 of the Rules of Court makes an implied reference to Section
47, Rule 130 of the Rules of Court before the deposition may be used in evidence. Under such rule,
the witness himself, if available, must be produced in court as if he were testifying de novo since his
testimony given at the former trial is mere hearsay. The deposition of a witness, otherwise available,
is also inadmissible for the same reason. In the instant case, the Sandiganbayan has no basis to
presume that the unavailability of Bane remains up to this time to justify the use of the same
deposition in another case or proceeding.The burden of establishing its existence rests on the party
who seeks the admission of the evidence.
Also, the parties to the first proceeding must be the same as the parties to the later
proceeding. Physical identity, however, is not required; substantial identity or identity of
interests suffices, as where the subsequent proceeding is between persons who represent the parties
to the prior proceeding by privity in law, in blood, or in estate. In the present case, the PCGG failed to
impute, much less establish, the identity of interest or privity between the then opponent, Africa, and
the present opponents, the respondents. While Africa and the respondents are all ETPI stockholders,
this commonality does not establish at all any privity between them neither doesthe sequestration
of their shares result in the integration of their rights and obligations which remain distinct and
personal to them.
Lastly, it cannot be said that the individual notices it sent to the respondents would be
sufficient to bind them to the conduct of the then opponents’ (Africas) cross-examination since, to
begin with, they were not even parties to the action. One not a party to an action, and neither in
privity nor in substantial identity of interest with any of the parties in the same action, can be bound
by the action or omission of the latter, by the mere expedient of a notice. Thus, we cannot simply
deduce a resultant waiver of the right to cross-examine from the respondents’ mere failure to attend
the deposition-taking despite notice sent by PCGG.
Expert Testimony
EDWIN TABAO y PEREZ v. PEOPLE OF THE PHILIPPINES

The relative weight and sufficiency of expert testimony is peculiarly within the province of the
trial court to decide, considering the ability and character of the witness, his actions upon the witness
stand, the weight and process of the reasoning by which he has supported his opinion, his possible bias
in favor of the side for whom he testifies, the fact that he is a paid witness, the relative opportunities for
study and observation of the matters about which he testifies, and any other matters which deserve to
illuminate his statements.
At around 10:00 p.m. of January 21, 1993, Edwin Tabao (Tabao) was driving his Toyota
Corolla car bearing plate number PCH-111 along Governor Forbes corner G. Tuazon Street towards
Nagtahan when it suddenly ramped on an island divider, bumping Rochelle Lanete who was crossing
the street. As a result of the impact, Rochelle was thrown into the middle of the road on her back.
Thereafter, Leonardo Mendez speeding blue Toyota Corona car with plate number PES-764 ran over
Rochelle’s body. Bystanders armed with stones and wooden clubs followed Mendez car until it
stopped near the Nagtahan Flyover. Francisco Cielo, a newspaper delivery boy, pleaded with the
bystanders not to hurt Mendez. Cielo went inside Mendez car, sat beside him, got his drivers license,
and ordered him to move the car backwards. Mendez followed his order, but his car hit the center
island twice while backing up. Cielo went out of the car and approached the sprawled body of
Rochelle; he and the petitioner brought Rochelles body inside Mendez car. The three of them (the
petitioner, Cielo and Mendez) brought Rochelle to the UST Hospital, where she died on February 6,
1993 due to septicemia secondary to traumatic injuries.
On appeal, the petitioner claims that the Court of Appeals (CA) violated Section 49, Rule 130
of the Revised Rules of Court when it disregarded the testimony of defense witness Police Senior
Inspector Danilo Cornelio who testified that the petitioner’s car could not have bumped the victim
because the latter’s body was not thrown in line with the car, but on its side. The petitioner argues
that P/Sr. Insp. Cornelio is highly qualified in the field of traffic accident investigation, and as such,
his statements are backed-up by [the] principles of applied physics, engineering, and mathematics.
ISSUE:
Whether or not the CA was correct in disregarding the testimony of the defense witness Police
Inspector Danilo Cornelio.
RULING:
YES. Section 49, Rule 130 of the Revised Rules of Court states that the opinion of a witness on
a matter requiring special knowledge, skill, experience or training, which he is shown to possess, may
be received in evidence. The use of the word may signify that the use of opinion of an expert witness
is permissive and not mandatory on the part of the courts. Allowing the testimony does not mean,
too, that courts are bound by the testimony of the expert witness. The testimony of an expert witness
must be construed to have been presented not to sway the court in favor of any of the parties, but to
assist the court in the determination of the issue before it, and is for the court to adopt or not to adopt
depending on its appreciation of the attendant facts and the applicable law. It has been held of expert
testimonies:
Although courts are not ordinarily bound by expert testimonies, they may place whatever
weight they may choose upon such testimonies in accordance with the facts of the case. The relative
weight and sufficiency of expert testimony is peculiarly within the province of the trial court to
decide, considering the ability and character of the witness, his actions upon the witness stand, the
weight and process of the reasoning by which he has supported his opinion, his possible bias in favor
of the side for whom he testifies, the fact that he is a paid witness, the relative opportunities for study
and observation of the matters about which he testifies, and any other matters which deserve to
illuminate his statements. The opinion of the expert may not be arbitrarily rejected; it is to be
considered by the court in view of all the facts and circumstances in the case and when common
knowledge utterly fails, the expert opinion may be given controlling effect. The problem of the
credibility of the expert witness and the evaluation of his testimony is left to the discretion of the trial
court whose ruling thereupon is not reviewable in the absence of abuse of discretion.
The Court emphasized that P/Sr. Insp. Cornelio was not an eyewitness to the incident; his
testimony was merely based on the Traffic Accident Report prepared by SPO4 Edgar Reyes who
himself did not witness the incident. At any rate, nowhere in P/Sr. Insp. Cornelios testimony did he
conclusively state that the petitioner could not have been involved in the incident. From the
foregoing, it is clear that P/Sr. Insp. Cornelio did not discount the possibility that the victim could
have been thrown on the side. He likewise admitted that the location of an accident victim in relation
to the vehicle would also depend on the speed of the vehicle and the point of impact.
Conclusive Presumption
ENRICO SANTOS v. NATIONAL STATISTICS OFFICE

G.R. No. 171129, 6 April 2011, FIRST DIVISION, (Del Castillo, J.)
The rule on estoppel against tenants is subject to a qualification. It does not apply if the
landlord’s title has expired, or has been conveyed to another, or has been defeated by a title paramount,
subsequent to the commencement of lessor-lessee relationship. In other words, if there was a change in
the nature of the title of the landlord during the subsistence of the lease, then the presumption does not
apply. Otherwise, if the nature of the landlord’s title remains as it was during the commencement of the
relation of landlord and tenant, then estoppel lies against the tenant.
On February 10, 2004, Enrico Santos (Santos) filed a Complaint for Unlawful Detainer in the
Municipal Trial Court (MTC). He claimed therein that he is the registered owner of the property. On
January 2, 1998, he entered into a Contract of Lease with the National Statistics Office (NSO) on said
property for a monthly rental. This contract was further extended for the second and third time. For
failing to pay despite demand the rentals for the months of December 2003 and January 2004 and for
its refusal to vacate the property even after the termination of the lease contracts on December 31,
2003, Santos sent NSO a formal demand for the latter to pay its unpaid monthly rentals and to vacate
the property. Notwithstanding receipt, NSO still refused to pay and to vacate the property. Hence, the
complaint.
In its Answer, NSO, through the Office of the Solicitor General, alleged that Santos and his wife
obtained a loan from China Banking Corporation, the payment of which was secured by a Real Estate
Mortgage constituted over the subject property. It claimed that when Santos entered into a contract
of lease with it in 1998, he did not inform NSO of the existence of said loan. When petitioner failed to
pay his obligation with China Bank, the property was eventually sold in an extrajudicial foreclosure
sale where said bank emerged as the highest bidder. Since Santos likewise failed to redeem the
property within the redemption period, title to the same was consolidated in favor of China Bank and
TCT was issued in its name on August 21, 2000. Despite this and again without informing NSO, NSO
misrepresented himself as still the absolute owner of the subject property and entered into the
second and third contracts of lease with NSO in February and September 2003. According to NSO, it
was only in November 2003 that it knew of the foreclosure of the subject property when it received
a letter from China Bank informing it that as early as August 2000, title to the property had already
been effectively consolidated in the name of the bank. Hence, China Bank advised NSO that as the
new and absolute owner of the subject property, it is entitled to the rental payments for the use and
occupancy of the leased premises from the date of consolidation. Santos having ceased to be the
owner of said property, NSO believed that the second and third contracts of lease it entered with him
had ceased to be in effect. Hence, Santos has no legal right to demand that NSO pay him said rentals
and vacate the leased premises.
ISSUE:
Whether or not the conclusive presumption that tenant is not permitted to deny the title of
his landlord at the time of the commencement of the relation of landlord and tenant between them
applies.
RULING:
NO. The conclusive presumption found in Sec. 2(b), Rule 131 of the Rules of Court provides
that “The tenant is not permitted to deny the title of his landlord at the time of the commencement
of the relation of landlord and tenant between them.” It is clear therefore that “what a tenant is
estopped from denying is the title of his landlord at the time of the commencement of the landlord-
tenant relation. If the title asserted is one that is alleged to have been acquired subsequent to the
commencement of that relation, the presumption will not apply." Hence, "the tenant may show that
the landlord’s title has expired or been conveyed to another or himself; and he is not estopped to
deny a claim for rent, if he has been ousted or evicted by title paramount."
While Santos appears to have already lost ownership of the property at the time of the
commencement of the tenant-landlord relationship between him and NSO, the change in the nature
of Santos’ title, as far as NSO is concerned, came only after the commencement of such relationship
or during the subsistence of the lease. This is precisely because at the time of the execution of the
second and third contracts of lease, NSO was still not aware of the transfer of ownership of the leased
property to China Bank. It was only in November 2003 or less than two months before the expiration
of said contracts when NSO came to know of the same after it was notified by said bank. This could
have been the reason why NSO did not anymore pay Santos the rents for the succeeding months of
December 2003 and January 2004. Thus, it can be said that there was a change in the nature of Santos’
title during the subsistence of the lease that the rule on estoppel against tenants does not apply in
this case. Santos’ reliance on said conclusive presumption must, therefore, necessarily fail since there
was no error on the part of the CA when it entertained NSO’s assertion of a title adverse to Santos.
Authentication and Proof of Documents
ADELAIDA MENESES (deceased), substituted by her heir MARILYN M. CARBONEL-GARCIA v.

ROSARIO G. VENTUROZO
Section 20, Rule 132 of the Rules of Court provides that before any private document offered as
authentic is received in evidence, its due execution and authenticity must be proved either: (a) by anyone
who saw the document executed or written; or (b) by evidence of the genuineness of the signature or
handwriting of the maker.
Rosario Venturozo (Venturozo) filed a complaint for ownership, possession and damages in
the Regional Trial Court (RTC) of Dagupan City against Adelaida Meneses (Meneses), alleging that
she is the absolute owner of an untitled coconut land in Pangasinan. Venturozo alleged that she
purchased the property from spouses Basilio de Guzman (De Guzman) and Crescencia Abad (Abad)
on January 31, 1973 as evidenced by a Deed of Absolute Sale, and that the vendors, in turn, purchased
the property from Meneses as evidenced by a Deed of Absolute Saledated June 20, 1966. Venturozo
alleged that she has been in possession of the land until Meneses, with some armed men, grabbed
possession of the land and refused to vacate despite repeated demands.
Meneses stated that Venturozo is the daughter of De Guzman, the vendee in the Deed of
Absolute Sale dated June 20, 1966 that Meneses purportedly executed. Meneses alleged that she
never signed any Deed of Absolute Sale and that the said deed is a forgery. Consequently, the Deed of
Absolute Sale dated January 31, 1973 is likewise null and void. In her Counterclaim, Meneses stated
that in view of the nullity of the falsified Deed of Absolute Sale of the subject property, and the fact
that Venturozo and her father had never been in actual possession of the property, Venturozo is
under legal obligation to execute a deed of reconveyance over the said property in her favor.
The RTC declared the deeds of sale void ab initio for being a forgery, thus ruling in favor of
Meneses. The Court of Appeals (CA) reversed the decision because Meneses failed to present clear
and convincing evidence to overcome the evidentiary force of the questioned Deed of Absolute Sale
dated June 1966, which appears on its face to have been executed with all the formalities required by
law.
ISSUE:
Whether or not the deed of absolute sale complied with the formalities required by law, which
would give it evidentiary force.
RULING:
NO. The necessity of a public document for contracts, which transmit or extinguish real rights
over immovable property, as mandated by Article 1358 of the Civil Code, is only for convenience; it
is not essential for validity or enforceability. As notarized documents, Deeds of Absolute Sale carry
evidentiary weight conferred upon them with respect to their due execution and enjoy the
presumption of regularity which may only be rebutted by evidence so clear, strong and convincing
as to exclude all controversy as to falsity. The presumptions that attach to notarized documents can
be affirmed only so long as it is beyond dispute that the notarization was regular. A defective
notarization will strip the document of its public character and reduce it to a private instrument.
Consequently, when there is a defect in the notarization of a document, the clear and convincing
evidentiary standard normally attached to a duly-notarized document is dispensed with, and the
measure to test the validity of such document is preponderance of evidence.
In this case, it should be pointed out that contrary to the finding of the Court of Appeals, the
Deed of Sale dated June 20, 1966 did not comply with the formalities required by law. Section 20,
Rule 132 of the Rules of Court provides that before any private document offered as authentic is
received in evidence, its due execution and authenticity must be proved either: (a) by anyone who
saw the document executed or written; or (b) by evidence of the genuineness of the signature or
handwriting of the maker. In regard to the genuineness of petitioners signature appearing on the
Deed of Absolute Sale dated June 20, 1966, the Court agrees with the trial court that her signature
therein is very much different from her specimen signatures and those appearing in the pleadings of
other cases filed against her, even considering the difference of 17 years when the specimen
signatures were made. Hence, the Court rules that petitioners signature on the Deed of Absolute Sale
dated June 20, 1966 is a forgery.
The Court finds the Notary Publics testimony self-serving and unreliable, because although
he testified that petitioner was the one who submitted her residence certificate to him on June 21,
1966, the next day after the Deed of Absolute Sale was executed on June 20, 1966, Crescencia de
Guzman, respondents mother, testified that she and her husband got the residence certificate from
petitioner and gave it to the Notary Public on June 21, 1966. Thus, it is doubtful whether the Notary
Public really knew the identity of the vendor who signed the Deed of Absolute Sale dated June 20,
1966.
Substantial Evidence
STERLING SELECTIONS CORPORATION v. LAGUNA LAKE DEVELOPMENT AUTHORITY (LLDA)

AND JOAQUIN G. MENDOZA, IN HIS CAPACITY AS GENERAL MANAGER OF LLDA
G.R. No. 171427, March 30, 2011, SECOND DIVISION (Nachura, J.)
Factual findings of administrative bodies on technical matters within their area of expertise
should be accorded not only respect but even finality if they are supported by substantial evidence even
if they are not overwhelming or preponderant.
One of Sterling Selections Corporation’s (Sterling) neighbors filed a complaint with the
Barangay Chairman against the former for creating loud unceasing noise and emitting toxic fumes,
coming from the manufacturing plant of the former’s predecessor, Unson, Faustmann and Company,
Inc. During conciliation proceedings, Sterling’s management undertook to relocate its operations
within a month. The parties signed an agreement to that effect. However, Sterling failed to abide by
the undertaking and continued to manufacture its products. Another neighbor of Sterling, wrote a
letter to the Barangay Chairman to complain about the loud noise and offensive toxic fumes coming
from the manufacturing plant. She also filed a formal complaint with the Department of Environment
and Natural Resources (DENR). The complaint was endorsed by the DENR to one of the agencies
under it, respondent Laguna Lake Development Authority (LLDA), which had territorial and
functional jurisdiction over the matter. Subsequently, the Monitoring and Enforcement Section-
Pollution Control Division of LLDA conducted an inspection of Sterling’s premises. According to the
LLDA, it was observed that the wastewater generated by Sterling’s operations was drained directly
to the sewer canal. However, since the wastewater was not yet for disposal, no sample could be
collected during the inspection. A Notice of Violation and a Cease and Desist Order (CDO) were served
on Sterling after it was found that it was operating without an LLDA Clearance and Permit.
Meanwhile, the complaint was endorsed by the LLDA to the Office of the Mayor. After hearing and
investigation, the Office of the Mayor issued a Closure Order against Sterling after finding that it was
operating without the requisite business permit.
Sterling then filed a petition for mandamus before the Regional Trial Court (RTC), contending
that, as a cottage industry, its jewelry business is exempt from the requirement to secure a permit
from the LLDA, it asked the court to order the latter to issue a certificate of exemption in its favor.
The RTC denied the petition, ruling that mandamus does not lie to compel the performance of a
discretionary duty. Nonetheless, the RTC allowed petitioner to file an amended petition
for certiorari and mandamus. Intervenors Alicia Maceda (Maceda), Ma. Corazon G. Logarta (Logarta),
and Rosario Charito Planas (Planas) filed a motion for intervention which was admitted by the RTC.
The RTC ruled against Sterling, and the same was affirmed by the Court of Appeals (CA).
ISSUE:
Whether or not the factual findings of LLDA is supported by substantial evidence.
RULING:
YES. It is a doctrine of long-standing that factual findings of administrative bodies on

technical matters within their area of expertise should be accorded not only respect but even finality
if they are supported by substantial evidence even if they are not overwhelming or
preponderant. Courts will not interfere in matters which are addressed to the sound discretion of the
government agency entrusted with regulation of activities coming under the special and technical
training and knowledge of such agency. The exercise of administrative discretion is a policy decision
and a matter that is best discharged by the government agency concerned and not by the courts.
The motives of the intervenors for filing the complaint are no longer relevant. Regardless of
what these motives may have been, the fact remains that the LLDA found Sterling to have violated
the pertinent environmental and regulatory laws. The Court recognizes the right of Sterling to engage
in business and to profit from its industry. However, the exercise of the right must conform to the
laws and regulations laid down by the competent authorities.

PTE., LTD.
The burden of proof rests upon the party who asserts the affirmative of an issue. And in labor
cases, the quantum of proof necessary is substantial evidence, or such amount of relevant evidence,
which a reasonable mind might accept as adequate to justify a conclusion.
Wilfredo Y. Antiquina (Antiquina) was hired, through manning agency Magsaysay Maritime
Corporation (MMC), to serve as Third Engineer on the vessel, M/T Star Langanger, which was owned
and operated by respondent Masterbulk Pte., Ltd. (Masterbulk). According to his contract of
employment, his engagement on the vessel was for a period of nine (9) months at a salary of
US$936.00 per month. Seven months later, he suffered a fracture on his lower left arm after a part
fell down on him. After formally informing MMC of his decision to forego the medical procedure
recommended by the company physician, Antiquina filed a complaint for permanent disability
benefits, sickness allowance, damages and attorney’s fees against herein respondents.
The Labor Arbiter ruled in favor of Antiquina. MMC appealed to the NLRC, who dismissed the
petition. In the Court of Appeals (CA), MMC appealed. The CA noted in making its decision that the
NLRC appeared to have followed the rule that the conclusions of the LA when sufficiently
corroborated by evidence on record be accorded respect by appellate tribunals. The CA modified its
decision.
Antiquina appealed to the Supreme Court. One of his contention was that the CA commited
grave abuse of discretion in not admitting and considering the evidence submitted by him showing
that he is a member of the union.
ISSUE:
Whether or not the contention of Antiquina is tenable.

RULING:
YES. The Court finds merit in Antiquina’s contention that it would be more in keeping with
the interest of fairness and substantial justice for the CA to likewise admit and review his evidence
despite being submitted only on appeal. There appears to be no justification for relaxing the rules of
procedure in favor of the employer and not taking the same action in the case of the employee,
particularly in light of the principle that technical rules of procedure shall be liberally construed in
favor of the working class in accordance with the demands of substantial justice. We have also
previously held that rules of procedure and evidence should not be applied in a very rigid and
technical sense in labor cases in order that technicalities would not stand in the way of equitably and
completely resolving the rights and obligations of the parties.
In line with the objective of dispensing substantial justice, the Court has examined the
evidence belatedly submitted by Antiquina to the CA. Unfortunately, even with this procedural
concession in favor of him, the Court does not find any sufficient basis to overturn the CA’s May 31,
2005 Decision on the merits. To recall, it was Antiquina’s assertion in his Position Paper that he is
entitled to US$80,000.00 as medical unfitness benefits under Article 20.1.5 of the CBA with AMOSUP,
which provision he merely quoted in his pleading. The Labor Arbiter awarded the amount of
US$80,000.00 as permanent medical unfitness benefits, citing the said AMOSUP CBA as his basis for
the award. The Court of Appeals found that such award was not supported by any evidence, in view
of petitioner’s failure to present a copy of the AMOSUP CBA and proof of his membership in said
union.
In National Union of Workers in Hotels, Restaurants and Allied Industries-Manila Pavilion Hotel
Chapter v. National Labor Relations Commission, the Court held that “the burden of proof rests upon
the party who asserts the affirmative of an issue. And in labor cases, the quantum of proof necessary
is substantial evidence, or such amount of relevant evidence which a reasonable mind might accept
as adequate to justify a conclusion."
ABOSTA SHIPMANAGEMENT CORPORATION v. NATIONAL LABOR RELATIONS COMMISSION

(FIRST DIVISION) and ARNULFO R. FLORES
Substantial evidence is more than a mere scintilla. It means such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion, even if other minds, equally
reasonable, might conceivably opine otherwise.
Arnulfo R. Flores (Flores) was employed with Abosta Ship Management Corporation. Flores
was repatriated due to alleged infractions committed while on board the vessel. In reaction, he filed
a complaint for illegal dismissal on January 13, 1998 against the agency and Panstar.
The Labor Arbiter (LA) dismissed the complaint for lack of merit. He found that the evidence
the agency and Panstar presented were convincing enough to prove that Flores was a serious threat
to the safety of the vessel and its crew. He noted that Flores failed to refute the agencys and Panstars
allegations that he incited the crew to rebel against the authority of the Master and the vessels senior
officers. He also found Flores to have been paid all his monetary entitlements. On appeal by Flores,
the National Labor Relations Commission (NLRC) reversed the LA’s ruling. The NLRC found that the
agency and Panstar failed to prove (1) that Flores termination of employment was for a just or
authorized cause and (2) that he was accorded due process. It opined that the main basis for the
dismissal action against Flores was the accusation that he agitated the crew to rebel against the
authorities of M/V Morning Charm, as reported by the Chief Officer (Chief Mate) and the 1st Assistant
Engineer. The reports, the NLRC believe, did not constitute proof of the validity of the dismissal.
Accordingly, the NLRC declared Flores to have been illegally dismissed.
The Court of Appeals (CA) dismissed the petition due to insufficiency in substance, as the
petitioner failed to show that the NLRC committed grave abuse of discretion in reversing the LA’s
decision finding Flores dismissal legal. It sustained the NLRCs conclusion that the dismissal was
without a valid cause and that Flores was denied due process.
ISSUE:
Whether or not there was substantial evidence
RULING:
YES. After a careful and objective study of the parties submissions, we find that there is
substantial evidence on record supporting Flores dismissal. Substantial evidence is more than a mere
scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support
a conclusion, even if other minds, equally reasonable, might conceivably opine otherwise.
The agency succeeded in showing, by substantial evidence, that its principal (Panstar) had a
valid reason for terminating Flores employment. The Master, Capt. B.H. Mun, decided to dismiss him
not only for agitating the crew to rebel against the authorities of the vessel M/V Morning Charm
(which the NLRC considered as the main reason for the dismissal), but for several other infractions.
As the records show, and as Capt. B.H. Mun stressed in his letter of November 17, 1997 to the agency
management, Flores was also charged with inefficiency or neglect of duty, insubordination, insolent
and disrespectful behavior, and other actuations which made him unfit for his position and rank.
It is clear that the letters of Chief Officer De Luna and 1st Assistant Engineer Escarolato
Panstars Capt. Chung, detailing how Flores agitated the crew (with charges of mismanagement of the
vessel), and Capt. B.H. Muns letter to the agency all depict a radio officer who undermined the
authority of the shipmaster and the other officers in the guise of raising labor-management issues on
board the vessel. Additionally and as an indication of his disrespect for the vessels management, as
well as his low regard for his work, he neglected his duties as radio officer and disobeyed Capt. B.H.
Muns instructions on several occasions. It is no surprise that his record of service yielded a very poor
assessment or a no further employment assessment. The NLRC grossly erred in rejecting the letters
as proof of the validity of Flores dismissal. It misappreciated the contents of the letters, especially
that of Capt. B.H. Mun. They did not contain a mere accusation of wrongdoing. The letters made direct
affirmative statements on Flores transgressions, all of which only elicited angry denials from him.
More significantly, he failed to refute the charges in the compulsory arbitration proceedings, as the
labor arbiter emphasized in his decision. This aspect of the case should have been given due
consideration by the NLRC.
Circumstantial Evidence
BENJAMIN JESALVA v. PEOPLE OF THE PHILIPPINES

An accused mere denial cannot outweigh the circumstantial evidence clearly establishing his
culpability in the crime charged. It is well-settled that the positive declarations of a prosecution witness
prevail over the bare denials of an accused.
Benjamin Jesalva (Jesalva) was charged with the crime of Murder. In the version of the
prosecution, the latter highlighted that, per testimony of Gloria Haboc, Leticia disclosed to her that
petitioner was courting Leticia. However, Leticia Aldemo (Leticia) told Jesalva that they should just
remain as friends because she was already married, and that she loved her handsome husband.
Moreover, the prosecution asseverated that, at around 12:20 a.m. of September 9, 1992, while
conducting patrol in St. Rafael Subdivision, together with other police officers, Senior Police Officer 1
Edgardo Mendoza (SPO1 Mendoza), by using his flashlight, saw petitioner on board his vehicle alone.
Upon sight, petitioner immediately started his vehicle and drove toward the town proper of
Sorsogon, which was directly opposite his residence in Ticol, Sorsogon, disregarding SPO1 Mendozas
calls. Lastly, at about 1:00 p.m. of September 9, 1992, petitioner, together with his first cousin Fiscal
Jose Jayona (Fiscal Jayona), went to the police station, wherein he voluntarily intimated to SPO4
William Desder (SPO4 Desder) that Leticia jumped out of his vehicle. At about 1:20 p.m. of September
9, 1992, SPO2 Enrique Renoria, together with other police officers, Fiscal Jayona, and petitioner
inspected the place, which petitioner identified as the place where he and Leticia sat. They found
bloodstains thereat.
In his relatively short stint on the witness stand, Jesalva denied that he killed Leticia. He
testified that he did not have any reason to kill her, and that he had many reasons why he should not
kill her.
The Regional Trial Court (RTC) ruled in favor of the prosecution, finding Jesalva guilty beyond
reasonable doubt based on circumstantial evidence, not of the crime of Murder, but of Homicide.
Aggrieved, Jesalva appealed to the Court of Appeals (CA). The CA affirmed the RTC’s ruling.
Undaunted, petitioner filed a Motion for Reconsideration, which the CA, however, denied. Jesalva
argues that no evidence was ever introduced as to how, when, and where Leticia sustained her
injuries. No witness ever testified as to who was responsible for her injuries. He refutes the
prosecution’s contention that, even if he took the 6th Street, the same could still lead to the 7th Street,
where Leticias house is located. Jesalva stresses that Olbes should have been considered as a suspect
in this case, considering that he was the last person seen with Leticia when she was still alive. On the
other hand, respondent People of the Philippines, through the OSG, insists that the CA, affirming the
RTCs ruling, did not err in convicting petitioner on the basis of circumstantial evidence, because the
particular circumstances enumerated by both the RTC and the CA satisfactorily meet the
requirements of the rules and of jurisprudence for conviction.
ISSUE:
Whether the accused can be convicted based on the circumstantial evidence presented.
RULING:
YES. Direct evidence of the commission of the crime charged is not the only matrix wherefrom
a court may draw its conclusions and findings of guilt. There are instances when, although a witness
may not have actually witnessed the commission of a crime, he may still be able to positively identify
a suspect or accused as the perpetrator of a crime as when, for instance, the latter is the person last
seen with the victim immediately before and right after the commission of the crime. This is the type
of positive identification, which forms part of circumstantial evidence. In the absence of direct
evidence, the prosecution may resort to adducing circumstantial evidence to discharge its burden.
Crimes are usually committed in secret and under condition where concealment is highly probable.
If direct evidence is insisted upon under all circumstances, the guilt of vicious felons who committed
heinous crimes in secret or in secluded places will be hard, if not well-nigh impossible, to prove.
Thus, there can be a verdict of conviction based on circumstantial evidence when the
circumstances proved form an unbroken chain which leads to a fair and reasonable conclusion
pinpointing the accused, to the exclusion of all the others, as the perpetrator of the crime. However,
in order that circumstantial evidence may be sufficient to convict, the same must comply with these
essential requisites, viz.: (a) there is more than one circumstance; (b) the facts from which the
inferences are derived are proven; and (c) the combination of all the circumstances is such as to
produce a conviction beyond reasonable doubt.
Jesalva’s mere denial cannot outweigh the circumstantial evidence clearly establishing his
culpability in the crime charged. It is well-settled that the positive declarations of a prosecution
witness prevail over the bare denials of an accused. The evidence for the prosecution was found by
both the RTC and the CA to be sufficient and credible, while Jesalva’s defense of denial was weak, self-
serving, speculative, and uncorroborated. Petitioners silence as to the matters that occurred during
the time he was alone with Leticia is deafening. An accused can only be exonerated if the prosecution
fails to meet the quantum of proof required to overcome the constitutional presumption of
innocence. We find that the prosecution has met this quantum of proof in this case.
PEOPLE OF THE PHILIPPINES v. FEDERICO LUCERO

G.R. No. 188705, 2 March 2011, FIRST DIVISION (Velasco, Jr., J.)
Conviction based on circumstantial evidence can be upheld, provided that the circumstances
proven constitute an unbroken chain which leads to one fair and reasonable conclusion that point to
the accused, to the exclusion of all others, as the guilty person.
Before the Regional Trial Court (RTC), Federico Lucero (Lucero) was charged of Rape with
Homicide. The prosecution presented Alejandro Dao (Dao), the Purok Leader. He testified that he
saw Lucero with other guy drinking outside a shop. He noticed that Lucero was wearing green short
pants. Jao was awakened by his daughter’s shouting that someone entered room of AAA. Jao claimed
that he saw Lucero running away, wearing briefs only and covering top of his head. Also, Jao testified
that he saw Lucero washing his green short pants and that he and the policeman saw scratches on
the back of Lucero. Prosecution also presented Anastacio Langgoy (Langgoy) as witness. Langgoy
testified that he was awakened by AAA’s voice calling for help and that he saw someone came out of
his house identified as Lucero. PO2 Gurrea also testified that Lucero admitted killing AAA and showed
him the knife used to kill AAA. Dr. Rodaje, NBI Medico Legal Officer, found several stab wounds and
contusions and hymenal lacerations. For his defense, Lucero claimed that he was only forced to admit
the killing because PO2 Guerra threatened to beat him to death.
RTC found no proof of maltreatment or torture on part of police and further held that enough
circumstantial evidence was presented to prove the guilt of the accused. In Lucero’s appeal to the
Court of Appeals (CA), he questioned the identification of him made by witnesses Jao and Langgoy
and assailed the trial court’s appreciation of alleged illegally- obtained evidence. The CA found that
enough circumstantial evidence was present to convict Lucero. Even so, the extrajudicial admission
to PO2 Guerra was inadmissible since Lucero was deprived of his right to counsel when he was
questioned. The bloodied shirt and knife found in room of Lucero were also inadmissible being fruits
of poisonous tree.
ISSUE:
Whether or not the circumstantial evidence is enough to uphold guilt of Lucero beyond
reasonable doubt
RULING:
YES. Even if the confession and the evidence gathered, bloodied shirt and knife, were
disregarded, the evidence that remain still supports the conviction of Lucero. The rules of evidence
allow a trial court to rely on circumstantial evidence to support its conclusion of guilt. Circumstantial
evidence is that evidence which proves a fact ot series of facts from which the facts in issue may be
established by inference. At times, resort to such is imperative since to insist on direct testimony
would result in setting criminals accused and deny proper protection to the community. As held by
the Court in People v. Pascual, in special complex crime of rape with homicide, resort to circumstantial
evidence is usually unavoidable because in rape, it is generally unwitnessed and very often only the
victim is left to testify. It becomes even more difficult to prove when rape is with homicide because
the victim could no longer testify. Under Section 3, Rule 133 of the Rules of Court, circumstantial
evidence shall be sufficient for conviction when the following requisites are complied with: a) there
is more than one circumstance; b) facts from which inferences are derived are proved; and c)
combination of all circumstances is such as to produce conviction beyond reasonable doubt.
In the case at bar, setting aside the bloodied shirt and knife, the CA and RTC relied on several
circumstances to justify the conviction. The circumstances given by the witnesses, taken altogether,
lead to inescapable conclusion that Lucero is guilty. Also, the positive identification of Langgoy can
be relied on as he remained unshaken in his testimony even under cross- examination. Langgoy’s
testimony dovetails with that of Jao. Therefore, the circumstantial evidence presented can support
the view that Lucero is guilty of committing rape with homicide.
Alibi/Denial
PEOPLE OF THE PHILIPPINES v. JUANITO APATTAD

G.R. No. 193188, 10 August 2011, THIRD DIVISION, (Velasco, Jr., J)
Alibi and denial cannot prevail over the positive identification of the accused as the perpetrator
of the crime.
Juanito Apattad (Apattad), the father of minor AAA, raped the latter four times. The first rape
was sometime in 2001 where AAA was just seven years old. It was repeated on June 10, 2003, June
11, 2003 and June 13, 2003. Apattad denied the accusation of rape hurled against him and claimed
that his wife was the one who initiated the criminal complaint against him because she thinks that he
has a mistress.
Between the two versions of the incident, the trial court gave credence to the version of the
prosecution and adjudged Apattad guilty of rape. The Court of Appeals (CA) affirmed the judgment
of conviction of the trial court. Hence, the petition.
ISSUE:
Whether or not Apattad is guilty of rape.
RULING:
YES. In People v. Estoya, the Court laid down the jurisprudential guidelines in assessing the
proffered defense of alibi. Jurisprudential rules and precepts guide this Court in assessing the
proffered defense. One, alibis and denials are generally disfavored by the courts for being weak. Two,
they cannot prevail over the positive identification of the accused as the perpetrators of the
crime. Three, for alibi to prosper, the accused must prove not only that they were somewhere else
when the crime was committed, but also that it was physically impossible for them to be at the scene
of the crime at the time of its commission. Fourth, alibi assumes significance or strength only when it
is amply corroborated by credible and disinterested witnesses. Fifth, alibi is an issue of fact that
hinges on the credibility of witnesses, and the assessment made by the trial court unless patently and
clearly inconsistent must be accepted.
In the present case, AAA positively identified accused-appellant in her testimony as the very
perpetrator of the crime of rape committed against her. Alibi and denial cannot prevail over the
positive identification of the accused as the perpetrator of the crime. Moreover, for alibi to prosper,
it is not enough for the accused to prove that he was in another place when the crime was committed
as he must likewise prove that it was physically impossible for him to be present at the crime scene
or its immediate vicinity at the time of its commission. As correctly observed by the trial court, a
distance of three (3) kilometers does not make it physically impossible for Apattad to be at the scene
of the crime at the time it was committed.
PEOPLE OF THE PHILIPPINES v. AVELINO SUBESA y MOSCARDON

Denial is one of the weakest of all defenses because it is easy to concoct and fabricate. To be
believed, denial must be supported by a strong evidence of innocence; otherwise, it is regarded as
purely self-serving. A young girl’s revelation that she had been raped, coupled with her voluntary
submission to a medical examination and willingness to undergo public trial where she could be
compelled to give out the details of an assault on her dignity, cannot be so easily dismissed as mere
concoction.
Five separate informations were filed against Avelino Subesa (Subesa) with the Regional Trial
Court (RTC). The Informations allege that Subesa committed various sexual felonies in relation to
R.A. No. 7610 against his own four minor daughters. These sexual acts range from acts of
lasciviousness to rape. Upon arraignment, Subesa, assisted by counsel, pleaded not guilty to all the
charges. The criminal actions were then jointly tried. In the course of the trial, the prosecution
presented the testimonies of the (private complainants_ AAA, BBB, CCC, DDD, their mother, EEE, and
Dr. Josiah Joma Espanta who issued the medical certificates showing lacerations in the victims’
hymen. For its part, the defense presented the sole testimony of Subesa denying the allegations in the
complaint.
After the trial, the RTC found Subesa guilty of sexually abusing his daughters. The Court of
Appeals (CA) affirmed with modification. Hence, the petition.
ISSUE:
Whether or not there Subesa is guilty of the crimes charged.
RULING:
YES. In almost all cases of sexual abuse, the credibility of the victim’s testimony is crucial in view
of the intrinsic nature of the crime where only the persons involved can testify as to its occurrence. In this
case, the Court finds no reason to disturb the findings of the RTC, as affirmed by the CA. Time and
again, the Court has emphasized that the manner of assigning values to declarations of witnesses at
the witness stand is best and most competently performed by the trial judge who has the unique and
unmatched opportunity to observe the demeanor of witnesses and assess their credibility. In essence,
when the question arises as to which of the conflicting versions of the prosecution and the defense is
worthy of belief, the assessment of the trial court is generally given the highest degree of respect, if
not finality. The assessment made by the trial court is even more enhanced when the CA affirms the
same, as in this case.
The Court finds that the prosecution successfully proved beyond reasonable doubt the
charges of rape and acts of lasciviousness against Subesa. All his four children positively identified
him as their molester. In rape cases, the accused may be convicted solely on the testimony of the
victim, provided it is credible, convincing, and consistent with human nature and the normal course
of things. Its examination of the records shows no indication that the Court should view the testimony
of the private complainants in a suspicious light.
The defense of denial interposed by Subesa cannot prevail over the positive testimony of his
children. Denial is one of the weakest of all defenses because it is easy to concoct and fabricate. To be
believed, denial must be supported by a strong evidence of innocence; otherwise, it is regarded as
purely self-serving. In this case, Subesa did not refute the charges by any independent evidence other
than his mere denial. Further, it has been repeatedly held that a young girl’s revelation that she had
been raped, coupled with her voluntary submission to a medical examination and willingness to
undergo public trial where she could be compelled to give out the details of an assault on her dignity,
cannot be so easily dismissed as mere concoction. When a woman or a girl-child says that she was
raped, she says in effect all that is necessary to show that rape has indeed been committed.
Inconsistencies
PEOPLE OF THE PHILIPPINES v. EVANGELINE SOBANGEE y EDAO

G.R. No. 186120, 31 January 2011, FIRST DIVISION (Velasco, Jr., J.)
Minor variances in the details of the witnesses accounts, more frequently than not, are badges
of truth rather than indicia of falsehood, and they often bolster the probative value of their testimonies.
Evangeline Sobangee y Edao (Sobangee) was charged of violating Section 5, Article II of

Republic Act No. (RA) 9165 or the Comprehensive Dangerous Drugs Act of 2002, for selling shabu.
Sobangee denied the charges. She also claimed that testimonies of the prosecution witnesses were
inconsistent, particularly, the date of the buy-bust operation, the time the buy-bust team left their
office, the stops made on the way to the target area, the location of the operatives during the buy-
bust, where the seized items were marked, the denomination of the buy-bust money, the identity of
the operative who informed accused-appellant of her constitutional rights, and the identity of the
alleged confidential informant.
The Regional Trial Court (RTC) convicted Sobangee ruling that the prosecution witnesses, the
arresting officers, had the presumption of regularity in the performance of official functions working
in their favor. The Court of Appeals (CA) affirmed. Hence, the petition.
ISSUE:
Whether or not the CA erred in finding Sobangee guilty beyond reasonable doubt of having
violated Sec. 5, Art. II of Republic Act No. 9165.
RULING:
NO. The trial court explained that the inconsistencies found in the testimonies of the
witnesses for the prosecution were minor and even made their testimonial evidence more believable
and unrehearsed. The Court agree with the trial and appellate courts in this respect. Minor variances
in the details of the witnesses accounts, more frequently than not, are badges of truth rather than
indicia of falsehood, and they often bolster the probative value of their testimonies. For a successful
appeal, the inconsistencies brought up should pertain to that crucial moment when the accused was
caught selling shabu, not to peripheral matters. What is material to the prosecution of the illegal sale
of dangerous drugs is proof that the transaction actually took place, coupled with the presentation in
court of the corpus delicti. The transaction between accused-appellant and the poseur-buyer and the
presentation in court of the shabu seized from her were adequately established, as can be gleaned
from the records.
PEOPLE OF THE PHILIPPINES v. EDGARDO FERMIN Y GREGORIO AND JOB MADAYAG, JR., Y
BALDERAS
G.R. No. 179344, 3 August 2011, SECOND DIVISION, (Perez, J)
The proof of the supposed buy-bust operation rests exclusively on the prosecution.
A police informant identified accused Job B. Madayag, Jr. (Madayag, Jr.) alias Rolan and
Edgardo G. Fermin (Fermin) alias Jon-Jon as sellers of illegal drugs. A buy-bust operation was
conducted wherein Fermin and Madayag Jr. were taken to the police station and all the pieces of
evidence were turned over to the desk officer, and the desk officer turned them over to the police
investigator.
PO2 Pascua affirmed in open court that he arrested and bodily frisked Fermin and was able
to recover one plastic sachet and one (1) .38 Paltik Revolver. However, he contradicted the previous
statement of PO2 Ibasco that PO1 Valencia was the one who got hold of Madayag, Jr. He testified that
it was PO2 Ibasco who arrested Madayag, Jr. and recovered from the latter the buy-bust money. He
contradicted himself when, on the earlier part of his testimony he said that all the pieces of evidence
including the plastic sachet which was the subject of sale were in his possession until they were
turned over to the investigator, he later testified that PO2 Ibasco recovered one plastic sachet from
Madayag, Jr. Nonetheless, the two police officers were one in testifying that a Joint Affidavit about the
conducted operation was executed by them at the police station.
The Regional Trial Court (RTC) found Fermin and Madayag, Jr. guilty of violating Section 5,
Article II of Republic Act No. 9165. Upon appeal before the Court of Appeals, the judgment of the trial
court that the two accused were guilty beyond reasonable doubt of the offense charged was affirmed.
ISSUE:
Whether or not there was really a buy-bust operation conducted.
RULING:
NO. In a prosecution for illegal sale of dangerous drugs, the following elements must be
proven: (1) that the transaction or sale took place; (2) that the corpus delicti or the illicit drug was
presented as evidence; and (3) that the buyer and seller were identified. The presence of these
elements is sufficient to support the trial courts finding of appellants guilt. What is material is the
proof that the transaction or sale actually took place, coupled with the presentation in court of the
prohibited or regulated drug. The delivery of the contraband to the poseur-buyer and the receipt of
the marked money consummate the buy-bust transaction between the entrapping officers and the
accused.
While the entrenched rule is that the assessment of witnesses and their testimonies is a
matter best undertaken by the trial court which had the opportunity to observe the demeanor,
conduct or attitude of the witnesses, the findings of the lower court on this point will be reversed on
appeal, if it overlooked substantial facts and circumstances which, if considered, would materially
affect the result of the case. The court found irreconcilable conflicts in the recollections about the
principal factum probandum which is the buy-bust itself.
There were contradictions as to who arrested Madayag, Jr and recovered the buy-bust money.
Another material contradiction was that coordination was made with the Philippine Drug
Enforcement Agency where in fact, none was made. Lastly, there was a contradiction on who was in
possession of the sachet of drugs which is vital on the chain of custody of the corpus delicti. The proof
of the supposed buy-bust operation rests exclusively on the prosecution. The clear inconsistencies
on important points cannot be disregarded where the issue is ones liberty. The contradictory
statements of the main prosecution witnesses need not even be appreciated together with the
defense position.
RADITO AURELIO y REYES v. PEOPLE OF THE PHILIPPINES

Inconsistencies in the testimonies of witnesses that refer to trivial and insignificant details do not destroy
their credibility. Moreover, minor inconsistencies serve to strengthen rather than diminish the prosecution’s case
as they tend to erase any suspicion that the testimonies have been rehearsed thereby negating any misgiving that
the same were perjured.
Two Informations charging petitioner Radito Aurelio y Reyes (Radito) with violation of
Sections 5 and 11, Article II of Republic Act (R.A.) No. 9165 or The Comprehensive Dangerous Drugs
Act of 2002were filed with the Regional Trial Court (RTC) and raffled off to Branch 213.Upon motion
of the prosecution, the two cases were consolidated. When petitioner was arraigned, he entered a
plea of not guilty to the charges. Thereafter, pre-trial and trial ensued.
The RTC rendered its Judgment convicting Radito for violation of Sections 5 and 11, Article II
of R.A. No. 9165. The Court of Appeals (CA) affirmed with modification the Judgment of the trial court
by increasing the penalty of imprisonment imposed on the petitioner in both cases. Radito filed a
Motion for Reconsideration but it was denied by the CA.
ISSUES
Whether the credibility of the prosecution’s witnesses is adversely affected by several

inconsistencies in their testimonies
RULING
NO. After a thorough review of the inconsistencies mentioned by the petitioner, we find that
they do not relate to the elements of the offenses committed. Rather, they tend to focus on minor and
insignificant matters. These inconsistencies do not detract from the fact that the prosecutions key
witness who conducted the entrapment, identified the petitioner as the same person who sold the
dangerous drug to him and from whose possession another plastic sachet containing shabu was
recovered.
Inconsistencies in the testimonies of witnesses that refer to trivial and insignificant details
do not destroy their credibility. Moreover, minor inconsistencies serve to strengthen rather than
diminish the prosecutions case as they tend to erase any suspicion that the testimonies have been
rehearsed thereby negating any misgiving that the same were perjured.Testimonies of witnesses
need only to corroborate each other on important and relevant details concerning the principal
occurrence. Besides, it is to be expected that the testimony of witnesses regarding the same incident
may be inconsistent in some aspects because different persons may have different impressions or
recollection of the same incident.
In the absence of evidence of any ill-motive on the part of the police officers who apprehended
the petitioner, the presumption of regularity in the performance of official duty prevails. The
presumption that official duty has been regularly performed was not overcome since there was no
proof showing that SPO2 Bacero and PO1 Jacuba were impelled by improper motive. There is,
therefore, no basis to suspect the veracity of their testimonies.
DNA
JESSE U. LUCAS v. JESUS S. LUCAS

In some states, to warrant the issuance of the DNA testing order, there must be a show cause
hearing wherein the applicant must first present sufficient evidence to establish a prima facie case or a
reasonable possibility of paternity or good cause for the holding of the test. In these states, a court order
for blood testing is considered a search, which, under their Constitutions (as in ours), must be preceded
by a finding of probable cause in order to be valid. Hence, the requirement of a prima facie case, or
reasonable possibility, was imposed in civil actions as a counterpart of a finding of probable cause.
Jesse U. Lucas (Jesse) filed a Petition to Establish Illegitimate Filiation with Motion for the
Submission of Parties to DNA Testing. Jesus Lucas (Jesus) was not served with a copy of the petition.
Nonetheless, Jesus learned of the petition to establish filiation. His counsel therefore went to the trial
court on August 29, 2007 and obtained a copy of the petition.
Jesse filed with the RTC a Very Urgent Motion to Try and Hear the Case. Hence, on September
3, 2007, the RTC, finding the petition to be sufficient in form and substance, issued the Order setting
the case for hearing and urging anyone who has any objection to the petition to file his opposition.
The court also directed that the Order be published once a week for three consecutive weeks in any
newspaper of general circulation in the Philippines, and that the Solicitor General be furnished with
copies of the Order and the petition in order that he may appear and represent the State in the case.
After learning of the September 3, 2007 Order, Jesus filed a motion for reconsideration .Jesus
averred that the petition was not in due form and substance because Jesse could not have personally
known the matters that were alleged therein. He argued that DNA testing cannot be had on the basis
of a mere allegation pointing to Jesus as Jesse’s father. Consequently, there must be at least a prima
facie showing of its necessity before it should be granted.
ISSUE:
Whether or not a prima facie showing necessary before a court can issue a DNA testing order.
RULING:
YES. Although a paternity action is civil, not criminal, the constitutional prohibition against
unreasonable searches and seizures is still applicable, and a proper showing of sufficient justification
under the particular factual circumstances of the case must be made before a court may order a
compulsory blood test. Courts in various jurisdictions have differed regarding the kind of procedures
which are required, but those jurisdictions have almost universally found that a preliminary showing
must be made before a court can constitutionally order compulsory blood testing in paternity
cases. We agree, and find that, as a preliminary matter, before the court may issue an order for
compulsory blood testing, the moving party must show that there is a reasonable possibility of
paternity. As explained hereafter, in cases in which paternity is contested and a party to the action
refuses to voluntarily undergo a blood test, a show cause hearing must be held in which the court can
determine whether there is sufficient evidence to establish a prima facie case which warrants
issuance of a court order for blood testing.
The same condition precedent should be applied in our jurisdiction to protect the putative
father from mere harassment suits. Thus, during the hearing on the motion for DNA testing, the
petitioner must present prima facie evidence or establish a reasonable possibility of paternity.
Notwithstanding these, it should be stressed that the issuance of a DNA testing order remains
discretionary upon the court. The court may, for example, consider whether there is absolute
necessity for the DNA testing. If there is already preponderance of evidence to establish paternity
and the DNA test result would only be corroborative, the court may, in its discretion, disallow a DNA
testing.
SPECIAL PROCEEDINGS
Settlement of Estate
RAMON S. CHING AND PO WING PROPERTIES, INC. v. HON. JANSEN R. RODRIGUEZ, in his
capacity as Presiding Judge of the RTC-Br.6 of Manila, et al.
A special proceeding is a remedy by which a party seeks to establish a status, a right, or a
particular fact. It is distinguished from an ordinary civil action where a party sues another for the
enforcement or protection of a right, or the prevention or redress of a wrong. To initiate a special
proceeding, a petition and not a complaint should be filed.
Joseph Cheng, et.al. filed a Complaint against Ching, et. al and all persons claiming rights or
titles from Ramon Ching (Ramon) and his successors-in-interest. In the Complaint, they alleged six
causes of action, emphasizing on Ramon Ching’s fraudulent acts which resulted to the latter claiming
the entire estate of the late Antonio Ching, Cheng et. al’s predecessor-in-interest.
Ching, et.al filed with the Regional Trial Court (RTC) a Motion to Dismiss. The RTC denied said
motion. Thereafter, Cheng, et.al filed an amended complaint adding a seventh cause of action (release
of CPPA totalling P4M in the custody of Metrobank) and impleading a new party-defendant
(Metrobank). Ching, et.al again filed a Motion to Dismiss the Amended Complaint on the alleged
ground of the RTC's lack of jurisdiction over the subject matter of the Complaint. They argued that
jurisdiction pertains to a probate or intestate court and not to the RTC acting as an ordinary court.
The RTC denied the said motion. The Court of Appeals (CA) affirmed. Hence, this petition.
ISSUE:
Whether or not the CA erred in affirming the RTC’s denial of the Amended Complaint as the
latter arguably sought the release of the trust funds c/o of Metrobank to Cheng et.al., the latter's
declaration as heirs of Antonio, and the propriety of Ramon's disinheritance, which suit partakes of
the nature of a special proceeding and not an ordinary action for declaration of nullity.
RULING:
NO. Although the Complaint and Amended Complaint sought, among others, the
disinheritance of Ramon and the release in favor of the Cheng, et.al of the CPPA now under
Metrobank's custody, the civil case remains to be an ordinary civil action, and not a special
proceeding pertaining to a settlement court. An action for reconveyance and annulment of title with
damages is a civil action, whereas matters relating to settlement of the estate of a deceased person
such as advancement of property made by the decedent, partake of the nature of a special
proceeding. Under Article 916 of the NCC, disinheritance can be effected only through a will wherein
the legal cause therefor shall be specified. This Court agrees with the RTC and the CA that while the
Complaint and Amended Complaint sought the disinheritance of Ramon, no will or any instrument
supposedly effecting the disposition of Antonio's estate was ever mentioned. Hence, despite the
prayer for Ramon's disinheritance, the civil case does not partake of the nature of a special
proceeding and does not call for the probate court's exercise of its limited jurisdiction.
They also argue that the prayers in the Amended Complaint, seeking the release of the CPPA
under Metrobank's custody and the nullification of the instruments subject of the complaint,
necessarily require the determination of the status as Antonio's heirs. It bears stressing that what
was prayed for was the declaration as the rightful owners of the CPPA which was in Mercedes'
possession prior to the execution of the Agreement and Waiver. The respondents also prayed for the
alternative relief of securing the issuance by the RTC of a hold order relative to the CPPA to preserve
Antonio's deposits with Metrobank during the pendency of the case. It can thus be said that the
prayer relative to the CPPA was premised on Mercedes' prior possession of and their alleged
collective ownership of the same, and not on the declaration of their status as Antonio's heirs.
Further, it also has to be emphasized that the respondents were parties to the execution of the
Agreement and Waiver prayed to be nullified. Hence, even without the necessity of being declared as
heirs of Antonio, Cheng, et.al. have the standing to seek for the nullification of the instruments in the
light of their claims that there was no consideration for their execution, and that Ramon exercised
undue influence and committed fraud against them.
In sum, the Court agrees with the CA that the nullification of the subject documents could be
achieved in an ordinary civil action, which in this specific case was instituted to protect the
respondents from the supposedly fraudulent acts of Ramon. In the event that the RTC will find
grounds to grant the reliefs prayed for, the only consequence will be the reversion of the properties
subject of the dispute to the estate of Antonio. The civil case was not instituted to conclusively resolve
the issues relating to the administration, liquidation and distribution of Antonio's estate, hence, not
the proper subject of a special proceeding for the settlement of the estate of a deceased person under
Rules 73-91 of the Rules of Court.
EDUARDO G. AGTARAP v. SEBASTIAN AGTARAP, et. al.

G.R. No. 177099/G.R. No. 177192, 8 June 2011, SECOND DIVISION (Nachura, J.)
The general rule is that the jurisdiction of the trial court, either as a probate or an intestate
court, relates only to matters having to do with the probate of the will and/or settlement of the estate
of deceased persons, but does not extend to the determination of questions of ownership that arise
during the proceedings.
Eduardo Agtarap (Eduardo) filed with the Regional Trial Court (RTC), Branch 114, Pasay City,
a verified petition for the judicial settlement of the estate of his deceased father Joaquin Agtarap
(Joaquin). The petition alleged that Joaquin died intestate on November 21, 1964 in Pasay City
without any known debts or obligations. During his lifetime, Joaquin contracted two marriages, first
with Lucia Garcia (Lucia), and second with Caridad Garcia (Caridad). Lucia died on April 24, 1924.
Joaquin and Lucia had three childrenJesus (died without issue), Milagros, and Jose (survived by three
children, namely, Gloria, Joseph, and Teresa). Joaquin married Caridad on February 9, 1926. They
also had three childrenEduardo, Sebastian, and Mercedes (survived by her daughter Cecile). At the
time of his death, Joaquin left two parcels of land with improvements in Pasay City.
RTC issued a resolution appointing Eduardo as regular administrator of Joaquin’s estate.

After which, the estate was ripe for distribution to the heirs of Joaquin. Eduardo then rendered a true
and just accounting of his administration from his date of assumption. However, some of the heirs
filed for the respective motions for reconsideration in the decision of the court in the partition of the
estate. The RTC then denied the motions. The case was then appealed to the Court of Appeals who
dismissed the petition.
Eduardo now comes before the Supreme Court, assailing the decisions rendered by the lower
court. One of the errors he posited is the RTC’s jurisdiction to determine questions of ownership.
According to him, the power and authority properly belongs to another court with general
jurisdiction.
ISSUE:
Whether or not the RTC has jurisdiction to rule on the ownership of the subject real
properties.
RULING:
NO. The general rule is that the jurisdiction of the trial court, either as a probate or an
intestate court, relates only to matters having to do with the probate of the will and/or settlement of
the estate of deceased persons, but does not extend to the determination of questions of ownership
that arise during the proceedings. The patent rationale for this rule is that such court merely
exercises special and limited jurisdiction. As held in several cases, a probate court or one in charge of
estate proceedings, whether testate or intestate, cannot adjudicate or determine title to properties
claimed to be a part of the estate and which are claimed to belong to outside parties, not by virtue of
any right of inheritance from the deceased but by title adverse to that of the deceased and his estate.
All that the said court could do as regards said properties is to determine whether or not they should
be included in the inventory of properties to be administered by the administrator. If there is no
dispute, there poses no problem, but if there is, then the parties, the administrator, and the opposing
parties have to resort to an ordinary action before a court exercising general jurisdiction for a final
determination of the conflicting claims of title.
However, this general rule is subject to exceptions as justified by expediency and

convenience. First, the probate court may provisionally pass upon in an intestate or a testate
proceeding the question of inclusion in, or exclusion from, the inventory of a piece of property
without prejudice to the final determination of ownership in a separate action. Second, if the
interested parties are all heirs to the estate, or the question is one of collation or advancement, or the
parties consent to the assumption of jurisdiction by the probate court and the rights of third parties
are not impaired, then the probate court is competent to resolve issues on ownership. Verily, its
jurisdiction extends to matters incidental or collateral to the settlement and distribution of the estate,
such as the determination of the status of each heir and whether the property in the inventory is
conjugal or exclusive property of the deceased spouse.
The Court holds that the general rule does not apply to the instant case considering that the
parties are all heirs of Joaquin and that no rights of third parties will be impaired by the resolution of
the ownership issue. More importantly, the determination of whether the subject properties are
conjugal is but collateral to the probate court’s jurisdiction to settle the estate of Joaquin.
her Attorney-in-Fact MARINA T. ENTIERRO
Res judicata under the first concept or as a bar against the prosecution of a second action exists
when there is identity of parties, subject matter and cause of action in the first and second actions. The
judgment in the first action is final as to the claim or demand in controversy, including the parties and
those in privity with them, not only as to every matter which was offered and received to sustain or
defeat the claim or demand, but as to any other admissible matter which might have been offered for
that purpose and of all matters that could have been adjudged in that case. In contrast, res
judicata under the second concept or estoppel by judgment exists when there is identity of parties and
subject matter but the causes of action are completely distinct. The first judgment is conclusive only as
to those matters actually and directly controverted and determined and not as to matters merely
involved herein.
Francisco Entierro (Francisco) died intestate and left behind a parcel of land (subject
property). Francisco’s spouse, Basilia Tabile (Basilia), and their legitimate children (collectively
referred to as Basilia, et al.), executed a Deed of Sale with Declaration of Heirship. At the same time,
sold the subject property to (petitioners) spouses Selga for P120,000.00. By reason of said sale, the
title in Francisco’s name was cancelled and replaced under Sps. Selga’s names.
Seven years later, Sony Entierro Brar (Brar), represented by her sister-in-law and attorney-
in-fact, Marina T. Entierro, filed before the Regional Trial Court (RTC) a Complaint for Annulment of
Sale with Damages against Sps. Selga. She claimed that she was one of the legitimate children of
Francisco and Basilia, and that she had been preterited. The RTC ruled in favour of Brar. It ruled that
the property relation of the heirs was governed by the provisions on co-ownership. Basilia, et al.,
validly sold all their rights and interests over the subject property, excluding the rights and interests
over the same pertaining to Brar. The said decision eventually became final and executory.
In a Letter, Brar informed Sps. Selga that she was exercising her right to redeem her share in
the subject property. The latter’s counsel, however, rejected the demand. This prompted Brar to
institute a Complaint for Legal Redemption with Damages. In their Answer, Sps. Selga invoked the
res judicata and/or forum shopping. The RTC ruled in favour of the Sps. Selga. The Court of Appeals
(CA) reversed the said ruling and held that Brar had validly exercised her right to redemption of the
subject property and was not barred by the final judgment in the first case herein narrated stating
that what had became final and conclusive was only with respect to the filiation and the right to
inherit, but not as to the right to redeem the property sold by her co-heirs. Hence, the instant petition.
ISSUE:
Whether or not res judicata applies in this case.
RULING:
YES. Res judicata has two concepts. The first is bar by prior judgment under Rule 39, Section
47(b), and the second is conclusiveness of judgment under Rule 39, Section 47(c). The case at bar
satisfies the four essential requisites of res judicata under the first concept, bar by prior
judgment, viz:
1. finality of the former judgment;

2. the court which rendered it had jurisdiction over the subject matter and the parties;
3. it must be a judgment on the merits; and
4. there must be, between the first and second actions, identity of parties, subject matter and
causes of action.
It is not disputed that the first Decision had become final and executory. There is also no
question that the RTC had jurisdiction over the subject matter and parties and that its Decision was
a judgment on the merits, i.e., one rendered after a consideration of the evidence or stipulations
submitted by the parties at the trial of the case. Controversy herein arises from the fourth
requirement: the identity of parties, subject matter and, particularly, the causes of action between
the first and second case. Evidently, there is identity of parties. There is also identity of subject matter
as both involved Brar’s rights and interests over the subject property as Francisco’s legitimate child
and compulsory heir. Finally, there is identity of causes of action which is the sale of the entire subject
property by Basilia, et al., to Sps. Selga without Brar’s knowledge and consent. Further, Brar’s right
to redeem the share in the subject property also arose from the said sale. Hence, res judicata applies.
ATTY. RICARDO B. BERMUDO v. FERMINA TAYAG-ROXAS
G.R. No. 172879, 2 February 2011, SECOND DIVISION, (Abad, J.)
Rule 109 of the Rules of Court does not apply to decisions regarding a lawyer’s right to fix his
attorneys fees for the legal services he rendered because this suit did not settle his account as
administrator.
Atty. Ricardo Bermudo (Atty. Bermudo) as executor, filed a petition for his appointment as
administrator of the estate of Artemio Hilario and for the allowance and probate of the latter’s will
before the Regional Trial Court (RTC) of Angeles City. The testator instituted Fermina Tayag-Roxas
as his only heir but several persons, who claimed to be Hilario’s relatives, opposed the petition. The
RTC rendered a decision, allowing the will and recognizing Roxas as Hilario’s sole heir. On appeal,
the Court of Appeals (CA) and the Court affirmed the RTC decision.
When the decision constituting Roxas as the sole heir became final, Atty. Bermudo who also
served as counsel for her in the actions concerning her inheritance filed a motion to fix his legal fees
and to constitute a charging lien against the estate for the legal services he rendered. The RTC granted
him fees equivalent to 20% of the estate and constituted the same as lien on the estates
property. Roxas appealed the order to the CA.
The CA rendered a decision that modified the RTC Order, limiting Atty. Bermudo’s
compensation as administrator to what Section 7, Rule 85 of the Rules of Court provides and making
his lawyer’s fees 20% of the value of the land belonging to the estate. Atty. Bermudo subsequently
filed a motion with the RTC for execution and appraisal of the estate on which his 20% compensation
would be based. The RTC granted the motion and ordered Roxas to pay Atty. Bermudo P12,
644,300.00 as attorney’s fees with interest at the rate of 6% per annum. Consequently, Roxas
challenged the order before the CA through a petition for certiorari.
ISSUES:
1. Whether or not the Roxas special civil action of certiorari must be denied since her remedy
should have been an appeal from the settlement of his account as administrator;
2. Whether or not Atty. Bermudo, as administrator, is also entitled to collect attorney’s fees;
RULING:
1. NO. Section 1, Rule 109 of the Revised Rules of Court enumerates the orders or judgments
in special proceedings from which parties may appeal. One of these is an order or judgment which
settles the account of an executor or administrator. The rationale behind this multi-appeal mode is
to enable the rest of the case to proceed in the event that a separate and distinct issue is resolved by
the court and held to be final.But the earlier award in Atty. Bermudo’s favor did not settle his account
as administrator. Rather, it fixed his attorneys fees for the legal services he rendered in the suit
contesting Roxas’ right as sole heir. Consequently, Section 1 (d) of Rule 109 does not apply.
Atty. Bermudo filed a motion for execution of the award in his favor which could be carried
out only after the RTC shall have determined what represented 20% of the value of the estates
lands. The fixing of such value at P12, 644,300.00 was not appealable since it did not constitute a new
judgment but an implementation of a final one. Indeed, an order of execution is not
appealable. Consequently, Roxas remedy in contesting the RTCs exercise of discretion in ascertaining
what constitutes 20% of the value of the estates lands is a special civil action of certiorari.
2. YES. Atty. Bermudo did not only serve as administrator of the estate. He also served as
Roxas counsel in the suit that assailed her right as sole heir. Atty. Bermudo brought the contest all
the way up to this Court to defend her rights to her uncle’s estate. And Atty. Bermudo
succeeded. Acting as counsel in that suit for Roxas was not part of his duties as administrator of the
estate. Consequently, it was but just that he is paid his attorneys fees.Besides, Atty. Bermudos right
to attorney’s fees had been settled with finality. This Court can no longer entertain Roxas lament that
he is not entitled to those fees.
DIOSDADO S. MANUNGAS v. MARGARITA AVILA LORETO and FLORENCIA AVILA PARREO

G.R. No. 193161, 22 August 2011, THIRD DIVISION, (Velasco, Jr., J.)
The Court has considered an appointment of a special administrator as an interlocutory or

preliminary order to the main case for the grant of letters of administration in a testate or intestate
proceeding.
Engracia Manungas (Engracia) was the wife of Florentino Manungas (Floretino). They had no
children. Instead, they adopted Samuel David Avila (Avila). Florentino died intestate
while Avila predeceased his adoptive mother. Avila was survived by his wife Sarah Abarte Vda. De
Manungas. Engracia filed a Motion for Partition of Estate in the intestate estate proceedings of
Florentino of which she was the administratrix. There, she stated that there are no other legal and
compulsory heirs of Florentino except for herself, Avila and a Ramon Manungas whom she
acknowledged as the natural son of Florentino. Meanwhile, Avila’s widow executed a Waiver of
Rights and Participation in favor of Engracia. A Decree of Final Distribution was issued in the intestate
estate proceedings of Florentino distributing the properties to Engracia and Ramon Manungas, the
surviving heirs.
The Regional Trial Court (RTC) appointed Parreo, the niece of Engracia, as the Judicial
Guardian of the properties and person of her incompetent aunt. Parreo then instituted a complaint
of illegal detainer and damages with the Municipal Trial Court against the spouses Diosdado Salinas
Manungas and Milagros Pacifico. The MTC issued a summary judgment in favor of Engracia. The RTC
affirmed the decision of the MTC. On November 4, 2002, the RTC issued another Order reversing itself
and ordering the revocation of its earlier appointment of Parreo as the administrator of the Estate of
Manungas while appointing Diosdado as the Special Administrator. The Court of Appeals (CA)
rendered a decision finding that the RTC acted with grave abuse of discretion in revoking its earlier
appointment of Parreo as the administrator of the Estate of Manungas and appointing Diosdado
instead.
ISSUE:
Whether or not the RTC Order dated November 4, 2002 is an interlocutory order
RULING:
YES. The Court has considered an appointment of a special administrator as an interlocutory

or preliminary order to the main case for the grant of letters of administration in a testate or intestate
proceeding. The appointment or removal of special administrators, being discretionary, is thus
interlocutory and may be assailed through a petition for certiorari under Rule 65 of the Rules of
Court. The Order dated November 4, 2002 is clearly an interlocutory order. As such, the order cannot
be the subject of an appeal under Rule 45 of the Rules of Court as argued by petitioner. The proper
remedy is the filing of a Petition for Certiorari under Rule 65.Verily, Margarita and Florencia made
use of the proper mode of review by filing a petition for certiorari under Rule 65 with the CA.
Margarita and Florencia filed the petition well within the prescribed period under this rule.
Writ of Amparo
ARTHUR BALAO, et al. v. GLORIA MACAPAGAL-ARROYO, et al.

G.R. No. 186050,13 December 2011, EN BANC (VILLARAMA, JR., J.)
Section 18 of the Amparo Rule provides that if the allegations in the petition are proven by
substantial evidence, the court shall grant the privilege of the writ and such reliefs as may be proper
and appropriate; otherwise, the privilege shall be denied.
Arthur Balao, et al. filed a Petition for the Issuance of a Writ of Amparo in favor of James Balao
(Balao) who was abducted by unidentified armed men. Balao was among those who founded the
Cordillera Peoples Alliance (CPA), a coalition of non-government organizations (NGOs) working for
the cause of indigenous peoples in the Cordillera Region. In 1988, while working for the CPA, he was
arrested on the charge of violation of the Anti-Subversion Law but the case was eventually dismissed
for lack of evidence.
Gloria Macapagal Arroyo, et al. claimed that there is no allegation of specific wrongdoing
against them that would show their knowledge, involvement or participation in the abduction of
James; that the petition failed to meet the requirement in the Rule on the Writ of Amparo that claims
must be established by substantial evidence. The Regional Trial Court (RTC) ruled for the issuance of
the writ.
ISSUE:
Whether the totality of evidence satisfies the degree of proof required by the Amparo Rule to
establish an enforced disappearance.
RULING:
NO. Section 18 of the Amparo Rule provides that if the allegations in the petition are proven
by substantial evidence, the court shall grant the privilege of the writ and such reliefs as may be
proper and appropriate; otherwise, the privilege shall be denied.
Assessing the evidence on record, the Court finds that the participation in any manner of
military and police authorities in the abduction of James has not been adequately proven. The
identities of the abductors have not been established, much less their link to any military or police
unit. There is likewise no concrete evidence indicating that James is being held or detained upon
orders of or with acquiescence of government agents.
However, the Court agrees with the trial court in finding that the actions taken by Arroyo, et
al. are very limited, superficial and one-sided. They clearly failed to discharge their burden of
extraordinary diligence in the investigation of James’ abduction. Such ineffective investigation extant
in the records of this case prevents us from completely exonerating the Arroyo, et al. from allegations
of accountability for James disappearance.
LT. COL. ROGELIO BOAC, et. al. v. ERLINDA T. CADAPAN AND CONCEPCION E. EMPEÑO
G.R. Nos. 184461-62/G.R. No. 184495/G.R. No. 187109, 31 May 2011, EN BANC (Carpio-
Morales, J.)
There is no need to file a motion for execution for an amparo or habeas corpus decision. Since
the right to life, liberty and security of a person is at stake, the proceedings should not be delayed and
execution of any decision thereon must be expedited as soon as possible since any form of delay, even for
a day, may jeopardize the very rights that these writs seek to immediately protect.
Sherlyn Cadapan (Cadapan), Karen Empeño (Karen), and Manuel Merino (Manuel) were
adubted by armed men in Sam Miguel, Bulacan. They were herded into a jeep and sped towards an
undisclosed location. The families of there victims scoured to nearby police precints and military
campus in the hope of finding them but the same yielded nothing. Spouses Asher and Erlinda
Cadapan (Spouses Cadapan) and Concepcion Empeño (Empeño) filed a petition for habeas corpus
before the Supreme Court, impleading Generals Romero Tolentino and Jovito Palparan (Gen.
Palparan), Lt. Col. Rogelio Boac (Lt. Boac), et. al.
The Court then issued the writ of habeas corpus, returnable to the presiding justice of the
Court of Appeals. In their answer, the impleaded respondents denied that the three victims are in the
custody of the military. They testified that they are not familiar with the victims and they have
inquired among their subordinates about the reported abduction and their inquiry yielded to
nothing. The Court of Appeals (CA) then dismissed the habeas corpus petition since the evidence is
not strong. Spouses Cadapan and Empeño, filed a motion for reconsideration and presented newly
discovered evidence that they have gathered.
Spouses Cadapan and Empeño then filed before the Court a petition for writ of amparo which
impleaded the previous respondents of the case and added then president, Gloria Macapagal-Arroyo.
The Supreme Court issued the writ of amparo, asked the appellate court to consolidate the petition
of habeas corpus and writ of ampara. The motion for reconsideration for the writ of habeas corpus
was then granted. However, the writ of amparo was not issued since the appellate court believes that
it will be superfluity to issue the latter. Lt. Boac then challenged the decision rendered by the
appellate court via petition for review. Meanwhile, Spouses Cadapan and Empeño, filed their own
petition for review assailing the appellate court’s decision in the writ of amparo case.
ISSUE:
Whether or not the appellate court erred in rendering a decision that the writ of amparo or
habeas corpus needs a motion for execution.
RULING:
YES. Contrary to the ruling of the appellate court, there is no need to file a motion for
execution for an amparo or habeas corpus decision. Since the right to life, liberty and security of a
person is at stake, the proceedings should not be delayed and execution of any decision thereon must
be expedited as soon as possible since any form of delay, even for a day, may jeopardize the very
rights that these writs seek to immediately protect.
The Solicitor General’s argument that the Rules of Court supplement the Rule on the Writ of
Amparo is misplaced. The Rules of Court only find suppletory application in an amparo
proceeding if the Rules strengthen, rather than weaken, the procedural efficacy of the writ. As it is,
the Rule dispenses with dilatory motions in view of the urgency in securing the life, liberty or security
of the aggrieved party. Suffice it to state that a motion for execution is inconsistent with the
extraordinary and expeditious remedy being offered by an amparo proceeding.
In fine, the appellate court erred in ruling that its directive to immediately release Sherlyn,
Karen and Merino was not automatically executory. For that would defeat the very purpose of having
summary proceedings in amparo petitions. Summary proceedings, it bears emphasis, are
immediately executory without prejudice to further appeals that may be taken therefrom.
EDITA BURGOS v. PRESIDENT GLORIA MACAPAGAL-ARROYO, et al.

G.R. No. 183711/G.R. No. 183712/G.R. No. 183713, 5 July 2011, EN BANC (Brion, J.)
Under Section16, Rule 102 of the Rules of Court, a person to whom a writ is directed, who
neglects or refuses to obey or make a return of the same according to the command thereof or files a
false return may also be punished by the court or judge for contempt.
On June 2010, the Court issued a Resolution referring the present case to the Commission on
Human Rights (CHR), as the Court’s directly commissioned agency tasked with the continuation of
the investigation of Jonas Joseph Burgos’ abduction , with the obligation to report its factual findings
and recommendations. The Court found the referral necessary as the investigation of the PNP-CIDG
and the AFP Provost Marshal had been less than complete for there were significant lapses in
handling the investigation. On particular, the Court highlighted the PNP-CIDG’s failure to identify the
cartographic sketches of two of the five abductors of Burgos based on their interview with
eyewitnesses. No significant follow through was made by PNP-CIDG in ascertaining the identities of
the sketches despite the evidentiary leads provided by State Prosecutor of DOJ.
The CHR found that the enforced disappearance of Jonas Burgos had transpired; and that his
constitutional rights to life, liberty, and security, were violated by the Government have been fully
determined. Jeffrey Cabintoy, one of the eyewitness, had a clear recollection of the face of Harry
Agagen Baliaga, Jr. as one of the principal abductors, apart from the faces of two cartographic
sketches, after he has shown the pictures in the PMA Yearbook of Batch Sanghaya 2000. The same
photo was shown to detained former 56th IB Army trooper Edmond Dag-uman, who also positviely
identified Lt. Harry Baliaga, Jr. The CHR also pointed out that most if not all of the actual abductors
would have been identified had it not for evidentiary difficulties put up by some police and military
elites. The deliberate refusal of The Judge Advocate General Roa to provide the CHR with the
requested documents does not only defy the Supreme Court directive but ipso facto created a
disputable presumption that AFP personnel were responsible for the abduction and that their
superiors would be found accountable.
ISSUE:
Whether or not the CHR findings are sufficient for the Court to issue a writ of amparo, writ of
habeas corpus, and declare respondents in contempt.
RULING:
NO, with regard to issuance of writ of amparo. The Court hold in abeyance the rulings on the
merits in the Amparo aspect of the present case and refer this case back to the CA in order to allow
Lt. Baliaga to file comments on CHR Report. The CA shall continue with the hearing of the Amparo
petition in light of the evidence previously submitted, the proceedings already conducted, and the
subsequent developments in the case particularly the CHR report. Thereafter, CA shall rule on the
merits of Amparo petition. Court also note that The Judge Advocate General failed to provide CHR
with copies of documents requested relevant to the case and thereby disobeyed Court’s resolution.
Under Section 16 of the Rule on the Writ of Amparo, any person who otherwise disobeys or resists a
lawful process or order of the court may be punished for contempt. In relation to this, TJAG Roa and
Deputy Chief of Staff Personnel are ordered to show cause and explain why they should not be help
in contempt.
YES, with regard to issuance of writ of habeas corpus. In light of the new evidence obtained
by the CHR, particularly the positive identification of Lt. Baliaga as one of the direct perpetrators in
abduction of Jonas Burgos, the Court set aside the dismissal of habeas corpus petition and issue anew
the writ of habeas corpus returnable to the Presiding Justice of CA who shall refer the writ to the
same CA division that decided the habeas corpus petition. Lt. Baliaga is ordered to be impleaded as
party and is required together with the incumbent AFP Chief of Staff, incumbent Philippine Army
Commanding General, and Commanding Officer of 56th IB at the time of disappearance to produce
the person of Burgos and to show cause why he should not be released from detention.
NO, with regard to declaration of contempt. Under Section16, Rule 102 of the Rules of Court,
a person to whom a writ is directed, who neglects or refuses to obey or make a return of the same
according to the command thereof or files a false return may also be punished by the court or judge
for contempt. For Edita Burgos to succeed in her petition to declare respondents in contempt for
filing false returns in the habeas corpus proceedings before the CA, she has the burden of proving
beyond reasonable doubt that the respondents had custody of Jonas Burgos. It is to be noted that at
the time of the CA proceedings, pieces of evidence were merely circumstantial and do not provide a
direct link between respondents and abduction of Jonas Burgos. However, the subsequent
developments in the case have given a twist to otherwise clear conclusion. The Court conclude that
CA’s dismissal of contempt charges should be provisional without prejudice of refiling the charge in
future should Edita Burgos find this step warranted by the evidence in the proceedings related to
Jonas Burgos’ disappearance.
Cancellation or Correction of Entries in the Civil Registry
REPUBLIC OF THE PHILIPPINES v. JULIAN EDWARD EMERSON COSETENG-MAGPAYO

G.R. No. 189476, 2 February 2011, THIRD DIVISION (Carpio-Morales, J.)
When a petition for cancellation or correction of an entry in the civil register involves
substantial and controversial alterations including those on citizenship, legitimacy of paternity or
filiation, or legitimacy of marriage, a strict compliance with the requirements of Rule 108 of the Rules
of Court is mandated.
Julian Edward Emerson Coseteng-Magpayo (Julian) filed before the Regional Trial Court
(RTC) of Quezon City a petition to change his name to Julian Edward Emerson Marquez Lim Coseteng.
He claimed that his parents, Fulvio M. Magpayo Jr. and Anna Dominique Marquez-Lim Coseteng, were
never legally married as shown by certifications from the National Statistics Office and Julian’s
academic records. After due notice and publication and no opposition to the petition having been
filed, an order of general default was entered by the trial court which then allowed Julian to present
evidence ex parte. The RTC granted the petition and ordered the correction of Julian’s birth
certificate by deleting the entry for the date and place of marriage of his parents thereby changing
Julian’s last name to Coseteng. The name of Julian’s father was likewise deleted in his birth certificate.
The Republic of the Philippines (Republic) filed a motion for reconsideration but it was
denied. Thus, it filed the present petition for review contending that the deletion of the entry on the
date and place of marriage of Julian’s parents from his birth certificate has the effect of changing his
civil status from legitimate to illegitimate, hence, any change in civil status of a person must be
effected through an appropriate adversary proceeding.
ISSUE:
Whether or not the change in Julian’s legitimacy is a substantial change, thereby making Rule
103 of the Rules of Court inapplicable.
RULING:
YES. A person can effect a change of name under Rule 103 (CHANGE OF NAME) using valid
and meritorious grounds including (a) when the name is ridiculous, dishonorable or extremely
difficult to write or pronounce; (b) when the change results as a legal consequence such as
legitimation; (c) when the change will avoid confusion; (d) when one has continuously used and been
known since childhood by a Filipino name, and was unaware of alien parentage; (e) a sincere desire
to adopt a Filipino name to erase signs of former alienage, all in good faith and without prejudicing
anybody; and (f) when the surname causes embarrassment and there is no showing that the
desired change of name was for a fraudulent purpose or that the change of name would prejudice
public interest. Julian’s reason for changing his name cannot be considered as one of, or analogous
to, recognized grounds, however. The change being sought in Julian’s petition goes so far as to affect
his legal status in relation to his parents. It seeks to change his legitimacy to that of illegitimacy. Rule
103 then would not suffice to grant Julian’s supplication. Since Julian’s desired change affects his civil
status from legitimate to illegitimate, Rule 108 applies.
Rule 108 clearly directs that a petition which concerns one’s civil status should be filed in the
civil registry in which the entry is sought to be cancelled or corrected, that of Makati in the present
case, and all persons who have or claim any interest which would be affected thereby should be made
parties to the proceeding. As earlier stated, however, the petition of Julian was filed not
in Makati where his birth certificate was registered but in Quezon City. And as the above-mentioned
title of the petition filed by Julian before the RTC shows, neither the civil registrar of Makati nor his
father and mother were made parties thereto. Republic v. Labrador mandates that a petition for
a substantial correction or change of entries in the civil registry should have as respondents the civil
registrar, as well as all other persons who have or claim to have any interest that would be affected
thereby. It cannot be gainsaid that change of status of a child in relation to his parents is a substantial
correction or change of entry in the civil registry.
LEGAL ETHICS AND PRACTICAL EXERCISES
LEGAL PROFESSION AND THE PRACTICE OF LAW
Nature and Characteristics of Disciplinary Actions
RE: LETTER-COMPLAINT OF ATTY. ARIEL SAMSON C. CAYETUNA, et al.

A.M. OCA IPI No. 08-127-CA-J, 11 January 2011, EN BANC (VELASCO, JR., J.)
There are three ways by which administrative proceedings against judges may be instituted:
(1) motu proprio by the Supreme Court; (2) upon verified complaint with affidavits of persons having
personal knowledge of the facts alleged therein or by documents which may substantiate said
allegations; or (3) upon an anonymous complaint supported by public records of indubitable integrity.
Also, in administrative proceedings, the burden of proof that respondent committed the acts complained
of rests on the complainant.
A letter-complaint was filed by a litigant before the Presidential Action Center (PAC) of the
Office of the President requesting assistance for the resolution of the case which has been pending
before the CA Mindanao Station for almost a year since its filing. Justice Elbinias received a copy of
said letter-complaint and assigned Atty. Cayetuna to draft the letter-reply explaining what transpired
with the case which had already been decided. Justice Elbinias, however, asked Atty. Cayetuna to sign
the letter-reply and he would simply note it. This was not palatable to Atty. Cayetuna who balked at
signing the letter-reply.
Atty. Cayetuna wrote then Chief Justice Reynato S. Puno a confidential letter narrating how
he was instantly terminated by Justice Elbinias due to his refusal to sign a letter-reply to a litigant. He
charged Justice Elbinias with Gross Inefficiency, Gross Inefficiency, Bribe Solicitation, Drinking
Liquor in Office Premises, Personal Use of Government Property and Resources, Falsification of a
Favored Employees Daily Time Record, Disrespect Towards fellow Justices, Oppression through
Intemperate, Oppressive and Threatening Language, and Grave Abuse of Authority.
ISSUE:
Whether Justice Elbinias is guilty of the charges
RULING:
NO. The Court is constrained to dismiss the instant case for being unsubstantiated. There are
three ways by which administrative proceedings against judges may be instituted: (1) motu
proprio by the Supreme Court; (2) upon verified complaint with affidavits of persons having personal
knowledge of the facts alleged therein or by documents which may substantiate said allegations; or
(3) upon an anonymous complaint supported by public records of indubitable integrity. Also, in
administrative proceedings, the burden of proof that respondent committed the acts complained of
rests on the complainant.
In the instant case, complainants not only failed to execute a verified complaint but also never
submitted their affidavits showing personal knowledge of the allegations embodied in their letter-
complaints. They have not shown, much less submitted, substantial evidence supporting their
allegations.
RE: ANONYMOUS LETTER RELATIVE TO THE ALLEGED CORRUPTION IN THE COURT OF
APPEALS, CAGAYAN DE ORO CITY
A.M. No. 07-6-14-CA, 18 January 2011, EN BANC (Carpio Morales, J.)
Where one, such as the present anonymous letter-writer, seeks the imposition of a penalty upon
a judicial officer or magistrate on the ground of corruption, among others, it behooves him/her to
establish the charge beyond reasonable doubt, for the general rules with regard to admissibility of
evidence in criminal cases apply.
Pertinent portions of the letter are as follows, quoted verbatim: “We are respectfully
requesting you to take action of the corruption in the Court of Appeals, Cagayan de Oro City. It is
highly politicize or shall we say Politicize Judiciary. Wherein those with political connections and
influence can always get favorable decisions or resolutions and worst, those cases whose merits are
not favorable to the people in power would not be decided and left in the dust in one corner of the
stockroom.”
The writer then proceeded to enumerate numerous instances of alleged corruption and
impropriety, including, among others: unwarranted delay in the resolution of pending cases; and
failure to act on an amicable settlement of a case submitted for resolution and approval.
ISSUE:
Whether or not the amount of proof required to prove a magistrate’s corruption in the
performance of his/her duties had been satisfied.
RULING:
NO. Where one, such as the present anonymous letter-writer, seeks the imposition of a
penalty upon a judicial officer or magistrate on the ground of corruption, among others, it behooves
him/her to establish the charge beyond reasonable doubt, for the general rules with regard to
admissibility of evidence in criminal cases apply. The Court finds that the writer failed to discharge
the burden.
OFFICE OF THE COURT ADMINISTRATOR (OCA) vs. JESUS VINCENT M. CARBON III, formerly
Clerk III, Regional Trial Court, Zamboanga City
A.M. No. P-10-2836, 28 September 2011, SECOND DIVISION (Brion, J.)
Separation from the service renders a former employee out of the reach of the government’s
administrative processes with respect to the former employment, but this claim does not hold true if the
separation from the service was in contemplation of and to escape administrative liability from an
offense that took place and was investigated while the employee was still in the service
Joie Ramos filed a complaint with the OCA against Judge Gregorio dela Pea III, Presiding Judge
of the RTC. Joie claimed that during the pendency of the case filed by his wife before the sala of Judge
Dela Pea, the latter asked money from him, and that he gave the latter around P300,000.00. However,
when Joie refused to give more money to Judge Dela Pea, the latter dismissed the case. In support of
his allegations, Joie attached to his complaint the affidavit of Carbon. During the investigation before
the CA, Judge Dela Pea appeared and testified, but neither Joie nor his witnesses appeared. As a result,
the Court dismissed the administrative complaint against Judge Dela Pea due to insufficiency of
evidence and directed an investigation about the involvement of Carbon III in view of his admissions
relating to his participation to the complained acts against Judge Dela Pea in his affidavit pursuant to
the Court’s authority to motu proprio investigate court personnel even in the absence of a direct
complaint or of a complainant, and to discipline erring members and employees after the observance
of due process.
Carbon III, however, did not appear in the investigation against him despite notice, nor did
he submit any evidence in his defense. He even stopped reporting for work without the benefit of any
approved leave of absence. Subsequently, he filed his resignation, but this resignation was never
approved due to his failure to submit the required clearance. Carbon III, however, never resurfaced.
The Court resolved to drop from the Rolls the name of Carbon III and declare his position vacant.
ISSUE:
Whether or not Carbon III may still be held administratively liable for grave misconduct while
in service despite the fact that his name has already been dropped from the rolls and is separated
from the service.
RULING:
YES. His absence without leave and dropping from the rolls did not place him outside the
Court’s reach as he apparently intended; he cannot use his disappearance as a shield against liability
for his actions while he was in office. Separation from the service renders a former employee out of
the reach of the government’s administrative processes, but this claim does not hold true if the
separation from the service was to escape administrative liability from an offense that took place and
was investigated while the employee was still in the service.
After he has been heard through his affidavit and after giving him the opportunity to explain
himself and to put up his defenses, he cannot now hide under the claim of denial of due process. Joie’s
complaint was regarding the bribery allegedly perpetrated by Judge Dela Pea through Carbon III.
Thus, it was a complaint, likewise, against the latter to which he responded with an admission that
he indeed secured sums from Joie under the representation that these were to be given to Judge Dela
Pea. In the ensuing formal investigation, Carbon III failed to appear despite notice and conveniently
dropped out of sight. Under these facts, the Court maintains its continuing jurisdiction to hold Carbon
administratively liable as a court employee for an illegality committed while in the service.
On the merits, he is guilty of gross misconduct. He admitted in his affidavit that he followed
up Joie’s wife’s case with Judge Dela Pea and that he handed over to the latter sums of money from
Joie. What remained proven was a case-fixing activity where Carbon III was a direct participant as
the middleman and fixer between the decision maker and the litigant. Thus viewed, the respondents
flawed character and unfitness for a position in the Judiciary stand out, aggravated by his shallow
scheme to escape liability by dropping out of sight.
MAKILITO B. MAHINAY vs. HON. IRENEO LEE GAKO, JR., Presiding Judge, RTC-Br.5, Cebu City
and JOCELYN B. SORENSEN; JOCELYN B. SORENSEN vs. MAKILITO B. MAHINAY
G.R. No. 165338, G.R. No. 179375; 28 November 2011; FIRST DIVISION (Del Castillo, J.)
Since judges must be free to judge, without pressure or influence from external forces or factors,
they should not be subject to intimidation, the fear of civil, criminal or administrative sanctions for acts
they may do and dispositions they may make in the performance of their duties and functions.
Disciplinary proceedings against judges do not complement, supplement, or substitute judicial remedies.
Administrative complaints are not intended to coerce judges to rule in complainants favor.
Mahinay filed a complaint for specific performance against the owners of a parcel of land and
one Felimon Suarez (Suarez), to compel them to convey the land to him. Mahinay alleged that, in an
earlier case, they arrived at a Compromise Agreement wherein the owners gave him preferential
right to buy a 200-square meter portion of Lot 5 if he will withdraw the said case. The trial court thus
issued a Judgment based on said Compromise Agreement. However, the owners sold the entire Lot 5
to Suarez without first offering the same to Mahinay. According to Mahinay, said transaction violated
his preferential right to buy as he was willing and capable of buying the property. The owners
asserted that there was no violation as the transaction between them and Suarez was actually an
equitable mortgage and not a sale. The RTC ruled in favor of Mahinay. The CA affirmed the RTC
Decision.
About a year later, Mahinay and Suarez filed a Joint Manifestation informing the RTC that in
compliance with its Decision, Suarez executed a Deed of Conveyance in favor of Mahinay, who, in
turn, deposited with the RTC the amount of P300,000.00. To pave the way for the complete
implementation of the RTC’s Decision, Mahinay filed an Omnibus Motion seeking to compel the
owners to vacate the property and turn over to him the owner’s copy of the lots TCT. The RTC, then
already presided by Judge Gako, issued a Resolution granting Mahinay’s motion. The branch sheriff
placed Mahinay in actual and physical possession of the entire Lot 5. However, the TCT could not be
surrendered to him as the same was already in possession of Sorensen by virtue of a Real Estate
Mortgage executed by the owners subsequent to the filing of Mahinay’s complaint. Mahinay filed a
Motion to Issue an Order Directing Sorensen to turn over the TCT to him. Judge Gako issued the
assailed Resolution denying Mahinay’s motion. Mahinay contends that Judge Gako acted with gross
ignorance of the law.
ISSUE:
Whether or not Judge Gako acted with gross ignorance of the law and abdication of judicial
duty.
RULING:
NO. Mahinay’s allegations are not based on his sincere and strong belief that Judge Gako
should be disciplined. They are mere ploys calculated to induce Judge Gako to grant his motion. We
cannot countenance such lamentable scheme of Mahinay. It is settled that disciplinary proceedings
against judges do not complement, supplement, or substitute judicial remedies. Administrative
complaints are not intended to coerce judges to rule in complainants favor.
Law and logic decree that administrative or criminal remedies are neither alternative nor
cumulative to judicial review where such review is available, and must wait on the result
thereof. Indeed, since judges must be free to judge, without pressure or influence from external forces
or factors, they should not be subject to intimidation, the fear of civil, criminal or administrative
sanctions for acts they may do and dispositions they may make in the performance of their duties
and functions; and it is sound rule, which must be recognized independently of statute, that judges
are not generally liable for acts done within the scope of their jurisdiction and in good faith; and that
exceptionally, prosecution of the judge can be had only if there be a final declaration by a competent
court in some appropriate proceeding of the manifestly unjust character of the challenged judgment
or order. Indeed, unless it can be shown that their acts are tainted with bad faith, malice, corrupt
purpose, or ignorance, judges cannot be held administratively liable for rendering an erroneous
judgment simply because they are not infallible. Instead of threatening Judge Gako with
administrative charges, Mahinay could have simply awaited the resolution of the case.
DUTIES AND RESPONSIBILITIES OF A LAWYER
Duties and Responsibilities of a Lawyer to the Society
RE: RESOLUTION OF THE COURT DATED 1 JUNE 2004 IN G.R. NO. 72954 AGAINST ATTY.
VICTOR C. AVECILLA
A.C. No. 6683, 21 June 2011, EN BANC (PEREZ, J.)
Taking judicial records, such as a rollo, outside court premises, without the court's consent, is
an administratively punishable act.
The Office of the Chief Attorney (OCAT) submitted a Memorandum opining that Atty. Avecilla
may be administratively charged, as a member of the bar, for taking out the rollo of a case to fulfill a
personal agenda. Atty. Avecilla shifts the blame on the person whose signature actually appears on
the tracer card of the case and who, without authority, took the subject rollo in his name.
ISSUE:
Whether or not Atty. Avecilla can be held administratively liable?
RULING:
YES. Taking judicial records, such as a rollo, outside court premises, without the court's
consent, is an administratively punishable act. The act of borrowing a rollo for unofficial business
entails the employment of deceit not becoming a member of the bar. It presupposes the use of
misrepresentation and, to a certain extent, even abuse of position on the part of the Atty. Avecilla
because the lending of rollos are, as a matter of policy, only limited to official purposes. As a lawyer
then employed with the government, Atty. Avecilla clearly violated Rule 6.02, Canon 6 of the Code of
Professional Responsibility which provides that a lawyer in the government service shall not use his
public position to promote or advance his private interests, nor allow the latter to interfere with his
public duties. Atty. Avecilla is meted the penalty of suspension from the practice of law for 6 months.
RODOLFO A. ESPINOSA and MAXIMO A. GLINDO v. ATTY JULIETA A. OMAÑA

A.C. No. 9081, 12 October 2011, SECOND DIVISION, (Carpio, J.)
The extrajudicial dissolution of the conjugal partnership without judicial approval is void. A
notary public should not facilitate the disintegration of a marriage and the family by encouraging the
separation of the spouses and extrajudicially dissolving the conjugal partnership.
Espinosa and his wife Elena Marantal, sought Omana’s legal advice on whether they could
legally live separately and dissolve their marriage. Omaña then prepared a document entitled
“Kasunduan Ng Paghihiwalay.” Espinosa and Marantal started implanting the conditions of the said
contract. However, Marantal took custody of all their children and took possession of most of the
conjugal property. Espinosa sought the advice of Glindo, his fellow employee who is a law graduate,
who informed him that the contract executed by Omaña was not valid. They hired the services of a
lawyer to file a complaint against Omaña. Omaña denied that she prepared the contract. She admitted
that Espinosa went to see her and requested for the notarization of the contract but she told him that
it was illegal. Omaña alleged that Espinosa returned the next day while she was out of the office and
managed to persuade her part-time office staff to notarize the document. Her office staff forged her
signature and notarized the contract.
ISSUE:
Whether or not Omaña violated the Code of Professional Responsibility in notartizing the
“Kasunduan Ng Paghihiwalay.”
HELD:
YES. A notary public should not facilitate the disintegration of a marriage and the family by
encouraging the separation of the spouses and extrajudicially dissolving the conjugal partnership,
which is exactly what Omaña did in this case. We cannot accept Omaña’s allegation that it was her
part-time office staff who notarized the contract. Even if it were true that it was her part-time staff
who notarized the contract, it only showed Omaña’s negligence in doing her notarial duties. We
reiterate that a notary public is personally responsible for the entries in his notarial register and he
could not relieve himself of this responsibility by passing the blame on his secretaries or any member
of his staff.
In preparing and notarizing a void document, Omaña violated Rule 1.01, Canon 1 of the Code
of Professional Responsibility which provides that [a] lawyer shall not engage in unlawful, dishonest,
immoral or deceitful conduct. Omaña knew fully well that the Kasunduan Ng Paghihiwalay has no
legal effect and is against public policy. Therefore, Omaña may be suspended from office as an
attorney for breach of the ethics of the legal profession as embodied in the Code of Professional
Responsibility.
Duties and Responsibilities of a Lawyer to the Legal Profession
TOMAS P. TAN, JR. v. ATTY. HAIDE V. GUMBA,

A.C. No. 9000, 5 October 2011, FIRST DIVISION, (Villarama, Jr., J.)
A lawyer may be disciplined for misconduct committed either in his professional or private
capacity.
Tan, a self-made businessman with a tailoring shop, filed a verified Complaint against Atty.
Gumba. Tan narrated that Atty. Gumba asked to be lent ₱350,000.00, promising to pay with 12%
interest after one year, and offering by way of security a parcel of land. Atty. Gumba showed Tan a
Special Power of Attorney (SPA) executed by Atty. Gumba’s parents and verbally assured Tan that
she was authorized to sell or encumber the entire property. Tan consulted Atty. Payte and was
assured that the documents provided by Atty. Gumba were valid. Thus, Tan agreed to lend money to
Atty. Gumba. Atty. Gumba executed in Tan’s favor an open Deed of Absolute Sale over the said parcel
of land, attaching thereto the SPA. Tan was made to believe that if Atty. Gumba fails to pay the full
amount of the loan with interest on due date, the deed of sale may be registered. Accordingly, he gave
the amount of ₱350,000.00 to Atty. Gumba. Atty. Gumba, however, defaulted on her loan obligation
despite Tan’s repeated demands. Tan went to the Register of Deeds to register the sale, only to find
out that Atty. Gumba deceived him since the SPA did not give Atty. Gumba the power to sell the
property but only empowered Atty. Gumba to mortgage the property solely to banks.
ISSUE:
Whether or not Atty. Gumba be administratively liable for violating Canon 1 and Canon 7 of
the Code of Professional Responsibility
RULING:
YES. Canon 7 of the Code of Professional Responsibility mandates all lawyers to uphold at all
times the dignity and integrity of the legal profession. Lawyers are similarly required, under Rule
1.01, Canon 1 of the same Code, not to engage in any unlawful, dishonest and immoral or deceitful
conduct. Here, Atty. Gumba’s actions clearly show that she deceived Tan into lending money to her
through the use of documents and false representations and taking advantage of her education and
Tan’s ignorance in legal matters. By her misdeed, Atty. Gumba has eroded not only Tan’s perception
of the legal profession but the public’s perception as well. Her actions constitute gross misconduct
for which she may be disciplined. Regarding Tan’s prayer that Atty. Pascua be disbarred, the Court
finds that suspension from the practice of law is sufficient to discipline Atty. Gumba. In this case, the
penalty of suspension of six months is sufficient.
PACITA CAALIM-VERZONILLA v. ATTY. VICTORIANO G. PASCUA

A.C. No. 6655, 11 October 2011, EN BANC, (Villarama, J.)
As a lawyer, respondent is expected at all times to uphold the integrity and dignity of the legal
profession and refrain from any act or omission which might lessen the trust and confidence reposed by
the public in the integrity of the legal profession.
Verzonilla alleges that Atty. Pascua prepared and notarized two Deeds of Extra-Judicial
Settlement of the Estate of Deceased Lope Caalim with Sale. The first deed was for a consideration of
P250,000 and appears to have been executed and signed by Lope’s surviving spouse and her children
in another’s favor. The second deed was for a consideration of P1,000,000 and appears to have been
executed by and for the benefit of the same parties as the first deed. The two deeds have identical
registration numbers, page numbers and book numbers in the notarial portion. Verzonilla avers that
both deeds are spurious because all the heirs’ signatures were falsified. Atty. Pascua’s admitted that
he drafted and notarized another instrument that did not state the true consideration of the sale so
as to reduce the capital gains and other taxes due on the transaction. The Integrated Bar of the
Philippines (IBP) found Atty. Pascua administratively liable on account of his indispensable
participation in an act designed to defraud the government. He recommended that Atty. Pascua be
suspended from the practice of law and that his notarial commission, if still existing, be revoked.
ISSUE:
Whether or not Atty. Pascua be suspended from practice of law for violating the Code of
Professional Responsibility
RULING:
YES. With Atty. Pascua’s admission, he cannot escape liability for making an untruthful
statement in a public document for an unlawful purpose. As the second deed indicated an amount
much lower than the actual price paid for the property sold, Atty. Pascua abetted in depriving the
Government of the right to collect the correct taxes due. Not only did Atty. Pascua assist the
contracting parties in an activity aimed at defiance of the law, he likewise displayed lack of respect
for and made a mockery of the solemnity of the oath in an Acknowledgment. By notarizing such illegal
and fraudulent document, he is entitling it full faith and credit upon its face, which it obviously does
not deserve considering its nature and purpose. Moreover, while Atty. Pascua’s duty as a notary
public, it is nevertheless incumbent upon him to guard against any illegal or immoral arrangement
or at least refrain from being a party to its consummation. In this case, Atty. Pascua proceeded to
notarize the second deed despite knowledge of its illegal purpose. His purported desire to
accommodate the request of his client will not absolve respondent who, as a member of the legal
profession, should have stood his ground and not yielded to the importuning of his clients.
Duties and Responsibilities of a Lawyer to the Courts
TERESITA D. SANTECO v. ATTY. LUNA B. AVANCE

A.C. No. 5834, 22 February 2011, EN BANC (Per Curiam)
Appearing as counsel despite a lawyer’s suspension is considered as failure to comply with Court
directives and thus constitutes gross misconduct, insubordination or disrespect which merits a
suspension or even disbarment.
In an En Banc Decision, the Court found Atty. Avance guilty of gross misconduct for, among
others, abandoning her client’s cause in bad faith and persistent refusal to comply with lawful orders
directed at her without any explanation for doing so. She was ordered suspended from the practice
of law for a period of five years. Subsequently, while Atty. Avance’s five-year suspension from the
practice of law was still in effect, the Presiding Judge of the RTC of Iba, Zambales sent a letter-report
to the Court Administrator informing the latter that Atty. Avance had appeared and actively
participated in three cases wherein she misrepresented herself as Atty. Liezl Tanglao. When opposing
counsels confronted her and showed to the court a certification regarding her suspension, Atty.
Avance admitted and conceded that she is Atty. Luna B. Avance, but qualified that she was only
suspended for three years and that her suspension has already been lifted.
ISSUE:
Whether or not Atty. Avance should be disbarred.
RULING:
YES. As an officer of the court, it is a lawyer’s duty to uphold the dignity and authority of the
court. The highest form of respect for judicial authority is shown by a lawyer’s obedience to court
orders and processes. Failure to comply with Court directives constitutes gross misconduct,
insubordination or disrespect which merits a lawyer’s suspension or even disbarment. Appearing as
counsel despite a lawyer’s suspension is considered as failure to comply with Court directives and
thus constitutes gross misconduct, insubordination or disrespect. Atty. Avance’s cavalier attitude in
repeatedly ignoring orders of the Supreme Court constitutes utter disrespect to the judicial
institution. Atty. Avance’s conduct indicates a high degree or irresponsibility. A Court’s Resolution is
not to be construed as a mere request, nor should it be complied with partially, inadequately, or
selectively. Atty Avance’s obstinate refusal to comply with the Court’s orders not only betrays
recalcitrant flaw in her character; it also underscores her disrespect of the Court’s lawful orders
which is only too deserving of reproof. Under Section 27, Rule 138 of the Rules of Court a member of
the bar may be disbarred or suspended from office as an attorney for gross misconduct and/or for a
willful disobedience of any lawful order of a superior court.
RE: LETTER OF THE UP LAW FACULTY ENTITLED RESTORING INTEGRITY: A STATEMENT BY

THE FACULTY OF THE UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW ON THE
ALLEGATIONS OF PLAGIARISM AND MISREPRESENTATION IN THE COURT
A.M. No. 10-10-4-SC, June 7, 2011, EN BANC (Leonardo-De Castro, J.)
Contumacious speech or conduct directed against a court or judicial officer, if committed by a

member of the Bar, may likewise subject the offender to disciplinary proceedings under the Code of
Professional Responsibility, which prescribes that lawyers observe and promote due respect for the
courts. In such disciplinary cases, the sanctions are not penal but administrative such as, disbarment,
suspension, reprimand or admonition.
The ponencia of Justice del Castillo in Vinuya, et al. v. Executive Secretary was promulgated,
which was the basis of a charge of plagiarism against Justice del Castillo by the counsel of the losing
party. The international authors reacted and wrote letters to the SC, stating that this is a case of
“possible plagiarism” and that their arguments may have been “misread” as the decision was contrary
to what the articles are forwarding. The faculty of the University of the Philippines College of Law
(UP Law faculty) issued a statement which, in part, said that the hopes of brave Filipinas in the case
were “crushed by a singularly reprehensible act of dishonesty and misrepresentation by the Highest
Court of the land,” calling it a “clear and obvious plagiarism”. In arriving at a contrary conclusion than
those of the articles allegedly plagiarized, the statement says that the “intellectual dishonesty” was
exacerbated by “transforming it into an act of intellectual fraud by copying works in order to mislead
and deceive.” This statement was posted online and was sent to the SC. In a resolution, the SC asked
the UP Law Faculty to show cause as to why they should not be disciplined as members of the Bar for
failure “to uphold the dignity and authority of the SC, to which they owe fidelity according to the oath
they have taken as attorneys, and not to promote distrust in the administration of justice.” The UP
Law Faculty filed their Common Compliance, which states their “noble intentions” and hinging their
lack of liability on freedom of expression and academic freedom. The UP Law Faculty prayed that the
Court’s Decision finding them liable for disciplinary measures be reconsidered and set aside.
ISSUES:
Whether there is a violation of Canon 11 of the Code of Professional Responsibility.
RULING:
YES. Canon 11 provides that “a lawyer shall observe and maintain the respect due to the
courts and to judicial officers and should insist on similar conduct by others.” More specifically, Rule
11.03 states that “a lawyer shall abstain from scandalous, offensive or menacing language or behavior
before the Courts.” In a lawyer’s relations with the courts, a lawyer may not divide his personality so
as to be an attorney at one time and a mere citizen at another. Accordingly, as a member of the bar
and an officer of the courts, the members of the UP Law Faculty are duty bound to uphold the dignity
and authority of this Court, to which they owe fidelity according to the oath they have taken as such
attorney, and not to promote distrust in the administration of justice. When the criticism comes from
persons outside the profession who may not have a full grasp of legal issues or from individuals
whose personal or other interests in making the criticism are obvious, the Court may perhaps tolerate
or ignore them. However, when law professors are the ones who appear to have lost sight of the
boundaries of fair commentary and worse, would justify the same as an exercise of civil liberties, this
Court cannot remain silent for such silence would have a grave implication on legal education in our
country. While a lawyer is entitled to present his case with vigor and courage, such enthusiasm does
not justify the use of offensive and abusive language. Language abounds with countless possibilities
for one to be emphatic but respectful, convincing but not derogatory, illuminating but not offensive.
Anent the contention of freedoms, the Court reminds that “freedom is not freedom from
responsibility, but freedom with responsibility.” The right to criticize the courts and judicial officers
must be balanced against the equally primordial concern that the independence of the Judiciary be
protected from due influence or interference.
The Court even paid attention to the sharp contrast between the civil tenor of letters of the
international authors and the antagonistic irreverence of the statement issued by the UP Law Faculty.
Notwithstanding that the international authors are beyond the disciplinary reach of the SC, they still
obviously took pains to convey their objections in a deferential and scholarly manner. Accordingly,
the mark of the true intellectual is one who can express his opinions logically and soberly without
resort to exaggerated rhetoric and unproductive recriminations.
JUDGE RENE B. BACULI vs. ATTY. MELCHOR A. BATTUNG

A.C. No. 8920, 28 September 2011, SECOND DIVISION (Brion, J.)
Litigants and counsels, particularly the latter because of their position and avowed duty to the
courts, cannot be allowed to publicly ridicule, demean and disrespect a judge, and the court that he
represents. It is the duty of a lawyer, as an officer of the court, to uphold the dignity and authority of the
courts. Respect for the courts guarantees the stability of the judicial institution; without this guarantee,
the institution would be resting on very shaky foundations.
Judge Baculi filed a complaint for disbarment with the Commission on Discipline of the
Integrated Bar of the Philippines (CoD-IBP) against Atty. Battung, alleging that the latter violated
Canons 11 and 12 of the Code of Professional Responsibility (CPR). According to Judge Baculi, he
asked Atty. Battung to tone down his voice because he was shouting, but the latter shouted at the top
of his voice, threatened to “file gross ignorance” against the Judge multiple times, and challenged the
judge to a fight, despite already being cited for contempt. Atty. Battung filed his Answer, essentially
saying that it was Judge Baculi who disrespected him, by saying, “you justify your negligence before
this court”, which, according to Atty. Battung, created a negative impression against him.
The IBP found that the Atty. Battung failed to observe Canon 11 of the CPR that requires a
lawyer to observe and maintain respect due the courts and judicial officers. The Atty. Battung also
violated Rule 11.03 that provides that a lawyer shall abstain from scandalous, offensive or menacing
language or behavior before the courts. With respect to the charge of violation of Canon 12 of the
CPR, the Commissioner found that the evidence submitted is insufficient.
ISSUE:
Whether or not Atty. Battung is guilty of violating Canons 11 and Rule 11.03 of the CPR.
RULING:
YES. Atty. Battung disrespected Judge Baculi by shouting at him inside the courtroom during
court proceedings in the presence of litigants and their counsels, and court personnel. He acted in a
manner that clearly showed disrespect for his position even after the latter had cited him for
contempt. In fact, after initially leaving the court, he returned to the courtroom and disrupted the
ongoing proceedings. These actions were not only against the person, the position and the stature of
Judge Baculi, but against the court as well whose proceedings were openly and flagrantly disrupted,
and brought to disrepute by Atty. Battung.
A lawyer who insults a judge inside a courtroom completely disregards the latters role,
stature and position in our justice system. When the Atty. Battung publicly berated and brazenly
threatened Judge Baculi that he would file a case for gross ignorance of the law against the latter,
he effectively acted in a manner tending to erode the public confidence in Judge Baculi’s competence
and in his ability to decide cases. Incompetence is a matter that, even if true, must be handled with
sensitivity in the manner provided under the Rules of Court; an objecting or complaining lawyer
cannot act in a manner that puts the courts in a bad light and bring the justice system into disrepute.
The Court suspends Atty. Battung from the practice of law for 1 year.
Duties and Responsibilities of a Lawyer to his Clients
ERLINDA R. TAROG v. ATTY. ROMULO L. RICAFORT

A.C. No. 8253, 15 March 2011, EN BANC, (PER CURIAM)
The Code of Professional Responsibility demands the utmost degree of fidelity and good faith
in dealing with the moneys entrusted to lawyers because of their fiduciary relationship.
The Arnulfo Tarog engaged Atty. Ricafort’s service regarding their bank-foreclosed
property in the Bicol region. Atty. Ricafort required the Tarogs to produce P65,000.00 to deposit in
court to counter the P60,000.00 deposited by the buyer of the foreclosed property. Since the Tarogs
only have P60,000.00, a loan was solicited from one Sia, who issued a check in that amount in the
name of Arnulfo. When Arnulfo said that he had first to encash the check at the bank, Atty. Ricafort
persuaded him to entrust the check to him instead so that he would be the one to encash it and then
deposit the amount in court. However, after some time and upon verification, Atty. Ricafort informed
them that he had not deposited the amount in court, but in his own account. He promised to return
the money. Despite several inquiries about when the amount would be returned, however, the Tarogs
received mere assurances from Atty. Ricafort that the money was in good hands.
The Tarogs further claimed that the RTC where their complaint for annulment of sale was
being heard had required the parties to file their memoranda. For that purpose, they paid P15,000.00
to Atty. Ricafort, but he did not file the memorandum. Arnulfo demanded by his letter that Atty.
Ricafort return the P65,000.00, plus interest, and the P15,000.00 paid for the filing of the
memorandum. No reply was received. Following his investigation, the Integrated Bar of the
Philippines - Commission on Bar Discipline recommended that Atty. Ricafort be indefinitely
suspended and be ordered to return the amounts.
ISSUE:
Whether or not Atty. Ricafort violated Canon 15, Rules 16.01, 16.02 and 16.03 of Canon 16,
and Canon 17 of the Code of Professional Responsibility
RULING:
YES. Undoubtedly, Atty. Ricafort was required to hold in trust any money and property of
his clients that came into his possession and he needed to be always mindful of the trust and
confidence his clients reposed in him. Thus, having obtained the funds from the Tarogs in the course
of his professional employment, he had the obligation to deliver such funds to his clients (a) when
they became due, or (b) upon demand. Atty. Ricafort’s act of obtaining amounts from the Tarogs
under the pretexts that the amount would be deposited in court and that he would prepare and file
the memorandum for the Tarogs erected a responsibility to account for and to use the amounts in
accordance with the particular purposes intended. For him to deposit the amount of P65,000.00 in
his personal account without the consent of the Tarogs and not return it upon demand, and for him
to fail to file the memorandum and yet not return the amount of P15,000.00 upon demand constituted
a serious breach of his fiduciary duties as their attorney. He reneged on his duty to render an
accounting to his clients showing that he had spent the amounts for the particular purposes intended.
He was thereby presumed to have misappropriated the moneys for his own use to the prejudice of
his clients and in violation of the clients trust reposed in him.
Atty. Ricafort’s plain abuse of the confidence reposed in him by his clients rendered him
liable for violation of the Code of Professional Responsibility. His acts and actuations constituted a
gross violation of general morality and of professional ethics that impaired public confidence in the
legal profession and deserved punishment. The Court finds and declares Atty. Ricafort guilty and,
accordingly, disbar him. Atty. Ricafort is ordered to return to Erlinda R. Tarog, the wife of deceased
Arnulfo, the sums of P65,000.00 and P15,000.00, plus interest of six percent per annum.
PATRICIO GONE v. ATTY. MACARIO GA

A.C. No. 7771, 6 April 2011, FIRST DIVISION (Perez, J.)
It is settled that a lawyer is not obliged to act as counsel for every person who may wish to
become his client. He has the right to decline employment subject however, to the provision of Canon 14
of the Code of Professional Responsibility. Once he agrees to take up the cause of a client, he owes fidelity
to such cause and must always be mindful of the trust and confidence reposed to him.
Gone filed a complaint for disciplinary action against Atty. Ga, his counsel in a labor case, for
the latter’s failure to reconstitute or turn over the records of the case in his possession. Atty. Ga
explained that as far as he could recall, during the pendency of their motion for reconsideration, the
NLRC Office caught fire. Although worried of the records of their case, he was relieved when he
received summons from the NLRC setting the case for hearing. However, in the two scheduled
hearings set by the NLRC, Gone failed to appear. For such absence, the NLRC allegedly shelved their
case. Atty. Ga averred that had it not been for the instant complaint, he would not have, as he never,
heard from complainant Gone since 1984. What he was aware of was the latter’s abandonment of his
family way back in 1978. Gone’s wife is the relative of Atty. Ga, being the daughter of his first cousin.
The Integrated Bar of the Philippines-Commission on Bar Discipline recommended Atty. Ga be
censured for violation of Rule 1.03, Canon 18 of the Code of Professional Responsibility.
ISSUE:
Whether or not Atty. Ga violated the Code of Professional Responsibility.
RULING:
YES. Atty. Ga breached his duties when he failed to reconstitute or turn over the records of
the case to his client Gone. His negligence manifests lack of competence and diligence required of
every lawyer. His failure to comply with the request of his client was a gross betrayal of his fiduciary
duty and a breach of the trust reposed upon him by his client. It is settled that a lawyer is not obliged
to act as counsel for every person who may wish to become his client. He has the right to decline
employment subject however, to the provision of Canon 14 of the Code of Professional Responsibility.
The moment he agreed to handle the case, he owes fidelity to his client’s cause and must always be
mindful of the trust and confidence reposed to him. He was bound to give it his utmost attention, skill
and competence. Public interest requires that he exerts his best efforts and all his learning and ability
in defense of his client’s cause. Those who perform that duty with diligence and candor not only
safeguard the interests of the client, but also serve the ends of justice. They do honor to the bar and
help maintain the community’s respect for the legal profession. As counsel, his failure to
communicate with his client deliberately disregarding its request for an audience or conference is an
unjustifiable denial of its right to be fully informed of the developments in and the status of its case.
Atty. Ga’s sentiments against Gone is not a valid reason for him to renege on his obligation as
a lawyer. If Atty. Ga believed that he will not be able to represent complainant effectively because of
what the latter has done to his family, then he should have withdrawn his services as a lawyer. For
the fact that he is retained as Gone’s lawyer, he was duty bound to give his best service. His failure to
do so constitutes an infringement of his oath.
NEMESIO FLORAN and CARIDAD FLORAN v. ATTY. ROY PRULE EDIZA

A.C. No. 5325, 19 October 2011, SECOND DIVISION, (Carpio, J.)
The practice of law is a privilege bestowed by the State on those who show that they possess the
legal qualifications for it. Lawyers are expected to maintain at all times a high standard of legal
proficiency and morality, including honesty, integrity and fair dealing.
Spouses Floran were defendants on an action for judicial foreclosure of mortgage on the
house situated on the land they own. Spouses Floran sought the assistance of Atty. Ediza, who
succeeded to have the case dismissed based on non-compliance with barangay conciliation
procedures. Subsequently, the Spouses Floran sold the land to Phividec Industrial Authority
(Phividec). Phividec required the couple to execute a waiver in Phividecs favor. When his help was
sought, Atty. Ediza informed the Spouses Floran to have the original owner of the land, Epal, sign a
Deed of Absolute Sale in their favor. Atty. Ediza gave the Spouses Floran several documents for Epal
to sign. Caridad visited Epal and acquired her approval and expressed assent to the conveyance, as
evidenced by a Deed of Absolute Sale made by Epal in favor of Nemesio. Atty. Ediza received an
amount for the titling of the remaining portion of the land. However, even after numerous follow-
ups, Atty. Ediza failed to fulfill his promises. After the lapse of two years, with the land still
unregistered, the Spouses Floran asked Atty. Ediza for the return of their money. Atty. Ediza refused.
Spouses Floran presented their complaint before the Integrated Bar of the Philippines (IBP)
Misamis Oriental. During the conference called by the IBP, Atty. Ediza refused to return the money
but promised to tear a document evidencing sale by the Spouses Floran to him of their property. The
Spouses Floran claimed that they had no knowledge that they executed such document in favor of
Atty. Ediza and suspected that they might have signed a document earlier which Atty. Ediza told them
not to read.
ISSUE:
Whether or not Atty. Ediza should be held administratively liable.
RULING:
YES. The practice of law is a privilege bestowed by the State on those who show that they
possess the legal qualifications for it. Lawyers are expected to maintain at all times a high standard
of legal proficiency and morality, including honesty, integrity and fair dealing. They must perform
their fourfold duty to society, the legal profession, the courts and their clients, in accordance with the
values and norms of the legal profession as embodied in the Code of Professional Responsibility.
Atty. Ediza deceived the Spouses Floran when he asked them to unknowingly sign a deed of
sale transferring a portion of their land to Atty. Ediza and gave Caridad several documents for Epal
to sign. Atty. Ediza made it appear that Epal conveyed her rights to the land to him and not to the
Spouses Floran. Moreover, when the sale of the Spouses Floran’s land pushed through, Atty. Ediza
received half of the amount from the proceeds given by the buyer and falsely misled the Spouses
Floran into thinking that he will register the remaining portion of the land. Lamentably, Atty. Ediza
played on the naivety of the Spouses Floran to deprive them of their valued property. This is an
unsavory behavior from a member of the legal profession. Aside from giving adequate attention, care
and time to his client’s case, a lawyer is also expected to be truthful, fair and honest in protecting his
client’s rights. Once a lawyer fails in this duty, he is not true to his oath as a lawyer.
ROGELIO ESTAVILLO v. ATTYS. GEMMO GUILLERMO and ERME LABAYOD

A.C. 6899, 16 November 2011 SECOND DIVISION (BRION, J.)
Under Canon 18 of the Code of Professional Responsibility, a lawyer shall serve his client with
competence and diligence. Pursuant to Rule 18.03 cited by the complainant, A lawyer shall not neglect
a legal matter entrusted to him, and his negligence in connection therewith shall render him liable.
Estavillo employed the legal services of Attys. Guillermo and Labayod for the case charged
against them. However, their case was derailed when the lawyers answered beyond the time given
to them by the court. Furthermore, the Estavillos aver that the lawyers did not inform them of the
dates of the hearings and other incidents to the case. In one instance, they waited at the law office,
only to be shunned away by their counsels telling them that they have a lot of work to do and they
are busy.
The lawyers meanwhile offered the defense that they have represented their clients in all of
the proceedings except in one case where they had an emergency meeting and that the case argued
before the court is actually a different issue and thus the regular rules of procedure must apply to
which they adhered to.
The clients instigated an action against them to which the Integrated Bar of the Philippines
found Atty. Guillermo and Labayod guilty of gross negligence and recommended a suspension of
three (3) months for both lawyers.
ISSUE:
Whether or not Attys. Guillermo and Labayod should be held administratively liable.
RULING:
YES. Under Canon 18 of the Code of Professional Responsibility, a lawyer shall serve his
client with competence and diligence. Pursuant to Rule 18.03, a lawyer shall not neglect a legal matter
entrusted to him, and his negligence in connection therewith shall render him liable. It betrays a lack
of the necessary competence and diligence required by the Code of Professional Responsibility in
responding to the courts summons for the Estavillos to make an appearance in the case and to file an
answer to the complaint. The respondents, especially Atty. Guillermo who was supposed to be the
lead counsel for the Estavillos, misappreciated the urgency and the importance of the courts
summons.
MARITES FREEMAN v. ATTY. ZENAIDA REYES

A.C. 6246, 15 November 2011 EN BANC (PER CURIAM)
Law advocacy, it has been stressed, is not capital that yields profits. The returns it births are
simple rewards for a job done or service rendered. It is a calling that, unlike mercantile pursuits which
enjoy a greater deal of freedom from government interference, is impressed with public interest, for
which it is subject to State regulation.
Freeman avers that after the death of her British husband, Atty. Reyes came to arrange all the
necessary documents such as visa applications in order to orchestrate the seamless travel of Freeman
to the United Kingdom. Reyes asked Freeman to shoulder her travel expenses to the UK to which the
latter agreed. Despite follow-ups however, there was no reply coming from Atty. Reyes. The lone
update Freeman got was the picture of the burial of her husband from the friend of her deceased
spouse. Reyes also asked sums of money and gifts as panlagay or grease money to the officials at the
British Embassy to facilitate Freeman’s visa application.
Reyes also offered to help as counsel to get the insurance policy of the deceased husband in
the UK to which Freeman eventually discovered that Reyes sent letters to the insurance companies
claiming that she is the wife and that the funds be transferred to Reyes’ accounts.
ISSUE:
Whether or not Atty. Reyes should be held administratively liable.
RULING:
YES. Law advocacy is not capital that yields profits. The returns it births are simple rewards
for a job done or service rendered. It is a calling that, unlike mercantile pursuits which enjoy a greater
deal of freedom from government interference, is impressed with public interest, for which it is
subject to State regulation. The relation between attorney and client is highly fiduciary in
nature. Being such, it requires utmost good faith, loyalty, fidelity, and disinterestedness on the part
of the attorney. Its fiduciary nature is intended for the protection of the client. The Canon of
Professional Ethics provides that the lawyer should refrain from any action whereby for his personal
benefit or gain, he abuses or takes advantage of the confidence reposed in him by his client. Money
of the client or collected for the client, or other trust property coming into the possession of the
lawyer, should be reported and accounted for promptly and should not, under any circumstances, be
commingled with his own or be used by him.
LYDIA CASTRO-JUSTO v. ATTY. RODOLFO GALING
A.C. 6174, 16 November 2011, SECOND DIVISION (PEREZ, J.)
There is conflict of interest when a lawyer represents inconsistent interests of two or more
opposing parties. The test is whether or not in behalf of one client, it is the lawyer’s duty to fight for an
issue or claim, but it is his duty to oppose it for the other client.
Castro-Justo engaged the services of Atty. Galing in connection with the issuance of the
bounced checks of a councilor of Manila. Having received the compensation for his legal services,
Atty. Galing sent to the councilor a demand letter. He further advised his client, Castro-Justo, to wait
until the lapse of time indicated in the letter.
With the time already lapsed, Castro-Justo moved to file a criminal charge against the erring
public official. It was discovered upon the filing of the motions however that Galing also represents
the councilor which is the reason why Castro-Justo instigated an action to have Galing
administratively liable for representing an opposing client, manifesting conflict of interest.
In his defense, Atty. Galing avers that he drafted the letter of Castro-Justo based on his long
friendship with Castro-Justo and not grounded on his professional capacity.
ISSUE:
Whether or not Atty. Galing should be held administratively liable for violating the Code of
Professional Ethics
RULING:
YES. A lawyer-client relationship can exist notwithstanding the close friendship between
Atty. Galing and Castro-Justo. The relationship was established the moment Castro-Justo sought legal
advice from Atty. Galing regarding the dishonored checks. By drafting the demand letter respondent
further affirmed such relationship. The fact that the demand letter was not utilized in the criminal
complaint filed and that Atty. Galing was not eventually engaged by Castro-Justo to represent her in
the criminal cases is of no moment. There is conflict of interest when a lawyer represents inconsistent
interests of two or more opposing parties. The test is whether or not in behalf of one client, it is the
lawyer’s duty to fight for an issue or claim, but it is his duty to oppose it for the other client.
2004 RULES ON NOTARIAL PRACTICE
RIZALINA L. GEMINA v. ATTY. ISIDRO S. MADAMBA

A.C. No. 6689, 24 August 2011 SECOND DIVISION (Brion, J.)
Under the 2004 Rules on Notarial Practice, the respondent’s failure to make the proper entry or
entries in his Notarial Register of his notarial acts, his failure to require the presence of a principal at
the time of the notarial acts, and his failure to identify a principal on the basis of personal knowledge by
competent evidence are grounds for the revocation of a lawyer’s commission as a notary public.
Gemina charged Atty. Madamba with deceit, malpractice and gross negligence. Gemina alleged
that she is an heir of the registered owner of several parcels of land located in Laoag City. These
parcels of land were unlawfully sold in connivance with Atty. Madamba. The documents pertaining
to the transactions over these lands were notarized by Atty. Madamba either without the presence of
the affiants or with their forged signatures. She alleges that, by notarizing documents through false
representations, without the signatories personally present before him as required under the
Notarial Law, Atty. Madamba should be held guilty of dishonesty and conduct unbecoming of a
member of the Philippine Bar.
In his Comment, Atty. Madamba admitted Gemina’s allegations on the notarization of the
subject documents, but denied any participation in the sale and transfer of the lands covered by the
documents. He claimed that it was his secretary who prepared and drafted the documents. He
claimed that his only participation was to affix his signature on the documents; he was already 82
years old and insulin dependent, so he had no more time to prepare documents and enter documents
in his notarial register. He begged for leniency and consideration from the Court, and asked for
forgiveness for his inadvertent acts. He apologized and committed himself not to repeat these
misdeeds.
ISSUE
Whether Atty. Madamba should be disciplined
RULING
YES. From Atty. Madamba’s own admissions, it cannot be doubted that he is guilty of the
charges against him. His admissions show that he had notarized documents without reading them
and without ascertaining what the documents purported to be. Because he completely entrusted to
his secretary the maintenance of his Notarial Register, inaccuracies resulted in the entry of the
notarial acts in his Notarial Register.
A notary public is empowered to perform a variety of notarial acts, most common of which are
the acknowledgement and affirmation of documents or instruments. In the performance of these
notarial acts, the notary public must be mindful of the significance of the notarial seal affixed on
documents: it converts a document from a private to a public instrument, after which it may be
presented as evidence without need for proof of its genuineness and due execution. Thus,
notarization should not be treated as an empty, meaningless, or routinary act. A notary public
exercises duties calling for carefulness and faithfulness. Notaries must inform themselves of the facts
they certify to; most importantly, they should not take part or allow themselves to be part of illegal
transactions.
The Notarial Law and the 2004 Rules on Notarial Practice, moreover, require a duly
commissioned notary public to make the proper entries in his Notarial Register and to refrain from
committing any dereliction or any act which may serve as cause for the revocation of his commission
or the imposition of administrative sanctions. Under the same Rules, the respondent’s failure to make
the proper entry, his failure to require the presence of a principal at the time of the notarial acts, and
his failure to identify a principal on the basis of personal knowledge by competent evidence are
grounds for the revocation of a lawyers commission as a notary public.
ATTY. FLORITA S. LINCO v. ATTY. JIMMY D. LACEBAL

A.C. No. 7241, 17 October 2011, THIRD DIVISION, (Peralta, J.)
Notarization is not an empty, meaningless, routinary act. It is invested with substantive public
interest, such that only those who are qualified or authorized may act as notaries
public. A notarial document is by law entitled to full faith and credit upon its face.
Linco claimed that she is the widow of the late Atty. Alberto Linco (Atty. Linco), the registered
owner of a parcel of land in Rizal. Linco alleged that Lacebal, a notary public, notarized a deed of
donation allegedly executed by her husband in favor of a minor. The notarial acknowledgment
thereof also stated that Atty. Linco and the mother of the donee, allegedly personally appeared before
Lacebal on July 30, 2003, despite the fact that Linco’s husband died on July 29, 2003.
Consequently, by virtue of the purported deed of donation, the Register of Deeds of Antipolo
City cancelled her late husband’s title and issued a new title in the name of the minor. Aggrieved,
Linco filed an administrative complaint and claimed that Lacebal's reprehensible act in connivance
with Toledo was not only violative of her and her children's rights but also in violation of the law and
his duty as a notary public.
ISSUE:
Did Lacebal violate the Notarial Law and the Code of Professional Responsibility?
RULING:
YES. Atty. Linco was already dead when Lacebal notarized the deed of donation. Lacebal
likewise admitted that he knew that Atty. Linco died a day before he notarized the said deed. Lacebal
also notarized the document after the lapse of more than 20 days from July 8, 2003, when he was
allegedly asked to notarize the deed of donation. The sufficient lapse of time from the time he last
saw Atty. Linco should have put him on guard and deterred him from proceeding with the
notarization of the deed of donation. However, Lacebal chose to ignore the basics of notarial
procedure. The fact that Lacebal previously appeared before him in person does not justify his act of
notarizing the deed of donation, considering the affiant's absence on the very day the document was
notarized. In the notarial acknowledgment of the deed of donation, Lacebal attested that Atty. Linco
personally came and appeared before him on July 30, 2003. Yet obviously, Atty. Linco could not have
appeared before him on July 30, 2003, because the latter died on July 29, 2003.
Clearly, Lacebal made a false statement and violated Rule 10.01 of the Code of Professional
Responsibility and his oath as a lawyer. Faithful observance and utmost respect of the legal solemnity
of the oath in an acknowledgment or jurat is sacrosanct. Notarization is not an empty, meaningless,
routinary act. It is invested with substantive public interest, such that only those who are qualified
or authorized may act as notaries public. A notarial document is by law entitled to full faith and credit
upon its face. Lacebal should not notarize a document unless the persons who signed the same are
the very same persons who executed and personally appeared before him to attest to the contents
and truth of what are stated therein.
JUDICIAL ETHICS
Impartiality of Judges
ATTY. FACUNDO T. BAUTISTA v. JUDGE BLAS O. CAUSAPIN, JR., Presiding Judge, Regional
Trial Court, Branch 32, Guimba, Nueva Ecija
A.M. No. RTJ-07-2044, 22 June 2011, FIRST DIVISION (LEONARDO-DE CASTRO, J.)
The disregard of established rule of law which amounts to gross ignorance of the law makes a
judge subject to disciplinary action. The conduct of a judge must be free from any whiff of impropriety
not only with respect to the performance of his judicial duties but also to his behavior outside his sala
and even as a private individual.
Atty. Bautista is the counsel of the plaintiffs in a complaint for partition on December 2005.
Judge Causapin granted defendant’s motions for extension to file their answer thrice despite lacking
the requisite notice of the time and place of hearing. Plaintiffs filed a motion to declare defendant in
default, which was set for hearing, but was reset multiple times due to the defendant’s absence.
Finally resolving plaintiff’s motion on September 2006, Judge Causapin dismissed the plaintiff’s
complaint on the ground of defects in the certificate of non-forum shopping. Atty. Bautista also
questioned Judge Causapin’s impartiality considering that Judge Causapin was seen having a drinking
spree with one of the defendants in the case and that they are both active members of the Masonic
Organization. Atty. Bautista also alleged that he was categorically requested by Judge Causapin to
withdraw the motion to declare defendants in default since, as assured by said Judge, the plaintiffs’
civil case for partition was already strong and there was no chance of plaintiffs losing the case. Atty.
Bautista filed an administrative case against Judge Causapin for gross ignorance of the law and gross
misconduct.
ISSUE:
Whether or not Judge Causapin is guilty of gross ignorance and gross misconduct.
RULING:
YES. Before a complaint can be dismissed for lack of a proper certificate of non-forum
shopping, notice and hearing are required. However, Judge Causapin had the discretion in the civil
case of either (1) setting a preliminary hearing specifically on the defect in the plaintiffs’ certificate
of non-forum shopping; or (2) proceeding with the trial of the case and tackling the issue in the course
thereof. In both instances, parties are given the chance to submit arguments and evidence for or
against the dismissal of the complaint. Judge Causapin neither conducted such a preliminary hearing
or trial on the merits prior to dismissing the case. Where the law involved is simple and elementary,
lack of conversance therewith constitutes gross ignorance of the law. Judges are expected to exhibit
more than just cursory acquaintance with statutes and procedural laws. They must know the laws
and apply them properly in all good faith. Judicial competence requires no less. The mistake
committed by the judge is not a mere error of judgment that can be brushed aside for being minor.
On the other hand, Judge Causapin’s drinking sprees with the defendants and request for Atty.
Bautista to withdraw plaintiff’s motion to declare defendants in default are evidently improper.
These render suspect his impartiality. A judge should so behave at all times as to promote public
confidence in the integrity and impartiality of the judiciary. The conduct of a judge must be free from
any whiff of impropriety not only with respect to the performance of his judicial duties but also to his
behavior outside his sala and even as a private individual.
Propriety of Judges
MANSUETA T. RUBIN vs. JUDGE JOSE Y. AGUIRRE, JR.
A.M. No. RTJ-11-2267, 19 January 2011, THIRD DIVISION (Brion, J.)
Court employees have no business meeting with litigants or their representatives under any
circumstance. This prohibition is more compelling when it involves a judge who, because of his position,
must strictly adhere to the highest tenets of judicial conduct; a judge must be the embodiment of
competence, integrity, and independence.
Rubin charged Judge Aguirre before the Office of the Court Administrator (OCA) of Graft and
Corruption, Betrayal of Public Trust, Grave Abuse of Authority of a Judge, Manifest Bias and Partiality,
and Violation of Judicial Conduct.
Rubin alleged that she is the widow of the late Feliciano Rubin who was appointed as the
Judicial Administrator of the Estate of the late Spouses Dioscoro and Emperatriz Rubin; that her late
husband was the victim of the acts complained of against Judge Aguirre during the conduct of the
special proceedings. She alleged that Judge Aguirre extorted money from the aforesaid Estate by
lending expertise in connivance with another lawyer in pursuing an alleged labor claim against the
Estate; that Judge Aguirre had threatened the Judicial Administrator to cite him for contempt and sell
the estate’s properties if he will not pay the said labor claims; that this harassment caused anxiety
against her late husband which made his health condition deteriorate so fast that facilitated his death;
that her late husband was forced to pay the amount by depositing it in court but no recipient would
claim the amount; that Judge Aguirre was grossly ignorant of the law when he appointed a Special
Administrator after her late husband refused to follow his unlawful orders; that Judge Aguirre had
extended unwarranted advantage to the newly appointed Judicial Administratrix of the Estate, Aileen
Rubin, through his manifest bias and partiality and evident bad faith towards Mansueta; and that
Judge Aguirre ordered Aileen Rubin to enter into the Estate, and having entered therein, she and her
cohorts ransacked the premises, took out records, personal belongings of Mansueta’s late husband,
Feliciano.
Judge Aguirre claimed that the complaint contained malicious and scurrilous allegations that
smacked of harassment. He asserted that his appointment of Aileen Rubin as Special Administratrix
was affirmed by the Court of Appeals (CA) and by the Supreme Court.
In its report, the OCA recommended that the case be docketed as a regular administrative
case considering the failure of Judge Aguirre to explain in his Comment why he invited Mr. Feliciano
Rubin to see him personally in court. The Investigating Justice found that except for the charge of
Conduct Unbecoming of a Judge and Violation of Judicial Conduct, the other charges against Judge
Aguirre were bereft of factual and legal basis. The Investigating Justice found that Judge Aguirre
committed an impropriety when he sent a letter to Mr. Feliciano Rubin to discuss and to expedite a
possible extra-judicial settlement of the estate of the deceased Spouses Rubin, in violation of Canon
2 of the Code of Judicial Conduct which states that a judge should avoid impropriety and the
appearance of impropriety in all activities.
ISSUE:
Whether or not Judge Aguirre is guilty of impropriety, and should therefore be held
administratively liable.
RULING:
YES. First, the complainants’ claims of alleged devious schemes, clever machinations, and
connivance employed by Judge Aguirre to extort money from the Estate of the Spouses Dioscoro and
Emperatriz Rubin are unsupported by evidence. The same holds true over the allegations of bias and
partiality in the appointment of the Aileen as Judicial Administratix. The orders to pay out of the
estate were issued to enforce a final and executory decision of the NLRC in the case. Moreover, the
propriety of the order of the appointment of Aileen was upheld by the CA and the SC.
In addition, a judge cannot be held liable for an erroneous decision in the absence of malice
or wrongful conduct in rendering it. We also held that for liability to attach for ignorance of the law,
the judge must not only act erroneously but must be established to have been motivated by bad faith,
dishonesty, hatred, or some other like motive. Mansueta failed to prove any of these circumstances
in this case.
Despite these findings, we find that Judge Aguirre committed an impropriety when he sent a
letter, in his official letterhead, to Mr. Feliciano Rubin to discuss a matter pending before his own
court. The act was improper considering that Judge Aguirre opened himself to suspicions in handling
the case. His action also raised doubts about his impartiality and about his integrity in performing his
judicial function.
VICTORIANO SY vs. Judge OSCAR DINOPOL, Regional Trial Court, Branch 24, Koronadal City
A.M. No. RTJ-09-2189, 18 January 2011, EN BANC (PER CURIAM)
Propriety and the appearance of propriety are essential to the performance of all the activities
of a judge. Business and financial dealings with a party would create a doubt about a judge’s fairness
and impartiality in deciding the case and would tend to corrode the respect and dignity of the court. It
is considered as conduct unbecoming of a judge.
Sy filed a complaint against Judge Dinopol for Conduct Unbecoming a Member of the Judiciary
and for Gross Ignorance of the Law, alleging that while a civil case, in which he and his wife sought
the declaration of nullity of the foreclosure proceedings against Metrobank, was pending before
Judge Dinopol’s sala, the judge inhibited himself from acting on the case. This notwithstanding, and
to Sy’s surprise, Judge Dinopol still handled a case involving a petition for the issuance of a writ of
possession filed by Metrobank, a matter closely intertwined with Sy’s case.
Sy further alleged that despite the issuance by the RTC Marawi City of a stay order and the
approval of the rehabilitation plan, as well as the pendency of Metrobank’s petition before the CA
assailing the validity of the stay order, Judge Dinopol ordered that the writ of possession be
implemented. In addition, Sy claimed that while his case was pending in Judge Dinopol’s sala, the
judge asked him for commodity loans in the form of construction materials to be used in the
construction of the judge’s house and that the judge borrowed his vehicle. The transactions were
evidenced by delivery receipts, disbursement vouchers, official receipts, and an acknowledgement to
prove his claim. Judge Dinopol denied Sy’s accusations.
The OCA Report found no basis for the charge of ignorance of the law on the part of Judge
Dinopol, but found him liable for conduct unbecoming a judge.
ISSUE:
1. Whether or not Judge Dinopol is guilty of gross ignorance of the law

2. Whether or not Judge Dinopol is guilty of conduct unbecoming of a judge.
RULING:
Anent the first issue:

NO. Judge Dinopol cannot be disciplined for ignorance of the law. In issuing the writ of
possession and in directing its re-implementation when it was returned unsatisfied the first time it
was enforced, Judge Dinopol acted in accordance with the rules and jurisprudence on the matter.
Further, regardless of whether there is a pending suit for the annulment of the mortgage or the
foreclosure itself, the purchaser is entitled to a writ of possession, without prejudice of course to the
eventual outcome of the annulment case. Once the writ of possession is issued, the trial court has no
alternative but to enforce the writ without delay. A stay order only affects claims filed against the
assets and properties belonging to a debtor. Properties that have already been foreclosed, and those
whose titles have already passed on to the winning bidder are no longer considered properties of the
debtor. In such case, it is a ministerial duty on the part of the trial court to grant a possessory
writ over the foreclosed properties.
Anent the second issue:

YES. Judge Dinopol is guilty of conduct unbecoming of a judge. Judge Dinopol’s business
dealings with Sy would create a doubt about his fairness and impartiality in deciding the case and
would tend to corrode the respect and dignity of the court. Propriety and the appearance of propriety
are essential to the performance of all the activities of a judge.
By his own admissions, Judge Dinopol failed to observe these ethical standards. In his
Answer/Comment, Judge Dinopol admitted that he talked with Sy on several occasions to discuss the
case, and that Sy requested him to delay the resolution of the writ of possession. His actions no doubt
created the inference that at some point, he acceded to Sy’s requests to delay the proceedings. This
conclusion is bolstered by his knowledge that the counsel for Metrobank was instructed to
immediately secure the order for the issuance of the writ of possession. Regardless of the
representations allegedly made to him by Sy, Judge Dinopol should have immediately issued the writ
of possession in Metrobank’s favor.
From these, the Court finds that Judge Dinopol compromised not only his impartiality but
also his independence and integrity as a judge. His actions diminished public confidence and public
trust in him as a judge. His actions gave the public the impression and the appearance that he can be
influenced by extraneous factors - other than the legal arguments and the court evidence in
discharging his judicial functions. Considering his numerous breaches of the standard ethical conduct
demanded of judges, the Court finds Judge Dinopol unfit to discharge the functions of a judge. The
severest penalty of dismissal from the service, with forfeiture of all retirement benefits and
disqualification from reinstatement or reappointment to any public office, shall be imposed.
VIVIAN T. DABU v. EDUARDO RODEN E. KAPUNAN, MA. THERESA CORTEZ, LEILA O. GALO
AND SUZETTE O. TIONGCO
A.M. No. RTJ-00-1600, 01 February 2011, EN BANC (PER CURIAM)
Falsification of an official document such as court records is considered dishonesty and a grave
offense. The commission of the acts warrants the penalty of dismissal from service.
Dabu was appointed 4th Assistant Provincial Prosecutor for Pampanga and was then
transferred and re-assigned to Guagua, Pampanga, to serve Branches 50, 51 and 52 of the Regional
Trial Court therein. Dabu however noticed that unlike in Branch 50, she was not being called upon to
intervene or investigate cases involving annulment of marriages in Branches 51 and 52, both
presided by Judge Kapunan, despite the fact that the cases for annulment of marriage were being
raffled equally among the five branches. She then found out that the records were being falsified and
made to appear that a prosecutor appeared during the supposed hearings of the annulment cases,
when, in truth, the prosecutors who supposedly appeared were either on leave or had already been
re-assigned to another station. Judge Kapunan failed to specifically deny under oath his participation
in the anomalous cases or to challenge the genuineness of his signature appearing in the court
records. While the case is pending, Judge Kapunan died. On the other hand, Galo failed to appear in
the proceedings or file any comment, or any pleading. She even admitted to Dabu on at least two
occasions that she had processed certain cases involving annulment of marriage with the go signal of
Judge Kapunan. Consequently, Cortez admitted preparing the questioned orders, decisions, minutes
of hearings, and transcripts, claiming that she only acted upon the instructions of Galo.
ISSUE:
Whether or not the accused are guilty of falsification of public documents?
RULING:
YES. Court employees, from the presiding judge to the lowliest clerk, being public servants in
an office dispensing justice, should always act with a high degree of professionalism and
responsibility. Their conduct must not only be characterized by propriety and decorum, but must
also be in accordance with the law and court regulations. No position demands greater moral
righteousness and uprightness from its holder than an office in the judiciary. Court employees should
be models of uprightness, fairness and honesty to maintain the people's respect and faith in the
judiciary. They should avoid any act or conduct that would diminish public trust and confidence in
the courts. Indeed, those connected with dispensing justice bear a heavy burden of responsibility.
Falsification of an official document such as court records is considered a grave offense. It

also amounts to dishonesty. Under the Administrative Code of 1987, dishonesty and falsification are
considered grave offenses warranting the penalty of dismissal from service upon commission of the
first offense. Furthermore, falsification of an official document is punishable as a criminal offense
under Article 171 of the Revised Penal Code. The penalty of dismissal, however, can no longer be
imposed and carried out with respect to the late Judge Kapunan. The administrative complaints
against him have become moot and academic and the case should be deemed closed and terminated.
ASHARY M. ALAUYA, CLERK OF COURT, SHARI'A DISTRICT COURT, MARAWI CITY v. JUDGE
CASAN ALI L. LIMBONA, SHARI'A CIRCUIT COURT, LANAO DEL SUR,
A.M. No. SCC-98-4, 22 March 2011, EN BANC, (PER CURIAM)I8
No officer or employee in the civil service shall engage directly or indirectly, in any
electioneering or partisan political campaign.
The Office of the Court Administrator (OCA) received a letter from a Clerk of Court in Marawi
City. Alauya reported that numerous verbal complaints had been received against Judge Limbona for:
(a) not reporting to his station; (b) having filed a certificate of candidacy as a party-list candidate
while serving in the Judiciary and while receiving his salary as a judge; and (c) obtaining from the
post office, without sufficient authority, checks representing benefits for court employees. A request
was also received from a "concerned citizen" that the court in Tamparan, Lanao del Sur, be moved to
Cotabato City where Judge Limbona resided since the judge had been reporting to Tamparan only
once a year since 1994. Upon the OCA's inquiry, the Commission on Elections (COMELEC) confirmed
that based on their records, a certain Limbona filed his certificate as a party-list candidate in the May
1998 elections. OCA confirmed, too, that Judge Limbona failed to submit any notice or information
about his candidacy. The OCA forthwith advised the Finance Services Office to discontinue the
payment of Judge Limbona's salary. The OCA confirmed the authenticity of Judge Limbona's
signatures on the certificate of candidacy in the May 1998 congressional elections with the National
Bureau of Investigation (NBI). the OCA recommended that Judge Limbona be found guilty of
dishonesty and be dismissed from the service with forfeiture of retirement and other privileges and
be barred from re-employment in the public service, and that he be made to refund all
salaries/allowances he received from March 26, 1998 to November 30, 1998 without prejudice to
the filing of an appropriate case in court.
ISSUE:
Whether or not Judge Limbona be found guilty of gross misconduct and dishonesty
RULING:
YES. Judge Limbona committed grave offenses which rendered him unfit to continue as a
member of the Judiciary. When he was appointed as a judge, he took an oath to uphold the law, yet
in filing a certificate of candidacy as a party-list representative without giving up his judicial post,
Judge Limbona violated not only the law, but the constitutional mandate that "no officer or employee
in the civil service shall engage directly or indirectly, in any electioneering or partisan political
campaign." The NBI investigation on the authenticity of his signatures on the certificate of candidacy
unqualifiedly established that the judge signed the certificate of candidacy, thus negating his claim
that his signatures were forged. For his continued performance of his judicial duties despite his
candidacy for a political post, Judge Limbona is guilty of grave misconduct in office.
OFFICE OF THE COURT ADMINISTRATOR v. JUDGE MA. ELLEN M. AGUILA

A.M. No. RTJ-07-2087, 07 June 2011, EN BANC (LEONARDO-DE CASTRO, J.)
Failure to disclose a pending administrative complaint in the Personal Data Sheet filed upon
one’s assumption of office when one already had notice of the adverse decision therein constitutes
dishonesty, considered a grave offense under the Administrative Code of 1987.
Ramon Ona-Ligaya wrote a letter, addressed to the Chief Justice and the Judicial and Bar
Council (JBC), expressing disappointment over the appointment of Aguilar as judge of the RTC of
Burgos, Pangasinan, since she had been charged with several criminal offenses involving moral
turpitude including Falsification of Public Document, Perjury and Estafa. Accordingly, when Aguilar
was asked in the Personal Data Sheet (PDS), during her application for the Judiciary, whether there
is any pending civil, criminal or administrative (including disbarment) case or complaint filed against
her pending before any court, prosecution office, any other office, agency or instrumentality of the
government, or the Integrated Bar of the Philippines, Atty. Aguilar wrote none, despite a pending
complaint for Dishonesty and Misconduct before the Office of the Ombudsman. Aguilar explained that
she thought her retirement as Legal Officer of Olongapo City rendered functus officio the
administrative case against her and the unusual penalties attendant to the administrative charges
such as removal, suspension or censure had been mooted by her retirement.
ISSUE:
Whether or not Aguilar is guilty of a grave offense under the Administrative Code.
RULING:
YES. Judge Aguilar’s failure to disclose the administrative case against her in her PDS filed
upon her assumption of office when she already had notice of the adverse decision therein
constitutes dishonesty, considered a grave offense under the Administrative Code of 1987, as well as
the Uniform Rules on Administrative Cases in the Civil Service, with the corresponding penalty of
dismissal from service even for the first offense. The accomplishment of the Personal Data Sheet is a
requirement under the Civil Service Rules and Regulations for employment in the government. Since
truthful completion of PDS is a requirement for employment in the Judiciary, the importance of
answering the same with candor need not be gainsaid.
Under Section 11, Rule 140 of the Rules of Court, a judge found guilty of a serious charge, such
as dishonesty, may be subjected to any of the following penalties: a.) dismissal from the service,
forfeiture of all or part of the benefits; b.) suspension from office without salary and other benefits
for more than three but not exceeding six months or c.) a fine of more than P20,000.00 but not
exceeding P40,000.00. Accordingly, the Court finds it appropriate to impose a suspension of six
months without pay in light of the above discussed extenuating circumstances.
Diligence of Judges
PROSECUTOR HILARIO RONSON H. TILAN v. JUDGE ESTER PISCOSO-FLOR

A.M. No. RTJ-09-2188, 10 January 2011, THIRD DIVISION (BRION, J.)
Judges need to decide cases promptly and expeditiously. Delay in the disposition of cases, it must
again be stated, is a major cause in the erosion of public faith and confidence in the justice system. For
this fundamental and compelling reason, judges are required to decide cases and resolve motions with
dispatch within the reglementary period. Failure to comply constitutes gross inefficiency, a lapse that
warrants the imposition of administrative sanctions against the erring magistrate.
Tilan was then handling two criminal cases pending promulgation, and another case for
Libel, pending arraignment before Judge Piscoso-Flor. Prosecutor Tilan claimed that in two of those
cases, Judge Piscoso-Flor resorted to the issuance of an order requiring the submission of the parties’
memoranda to circumvent the statutory period for the resolution of cases. Prosecutor Tilan then
charged Judge Piscoso-Flor with gross inefficiency, gross negligence and dishonesty.
ISSUE:
Whether Judge Piscoso-Flor is guilty of gross inefficiency, gross negligence and dishonesty
RULING:
YES. It cannot be over emphasized that judges need to decide cases promptly and
expeditiously. Delay in the disposition of cases is a major cause in the erosion of public faith and
confidence in the justice system. For this fundamental and compelling reason, judges are required to
decide cases and resolve motions with dispatch within the reglementary period. Failure to comply
constitutes gross inefficiency, a lapse that warrants the imposition of administrative sanctions
against the erring magistrate.
In the instant case, although Judge Piscoso-Flor claimed that she had requested for an
extension of time to decide, there was no showing that the request was ever granted. Over and above
this consideration, she allowed the parties to control the period of disposition of the case through
their lukewarm response to her call for the submission of memoranda, which she had to do twice. She
could have acted more firmly, considering that she only inherited the case, which implies that it had
been on the docket for quite some time. In any event, Judge Piscoso-Flor should have known that the
Court may grant extension of time to file memoranda, but the ninety (90) day period for deciding the
case shall not be interrupted thereby.
OFFICE OF THE COURT ADMINISTRATOR vs. FORMER JUDGE LEONARDO L. LEONIDA, OF THE
REGIONAL TRIAL COURT BRANCH 27, STA. CRUZ, LAGUNA
A.M. No. RTJ-09-2198, 18 January 2011, EN BANC (Per Curiam)
The failure of a judge of a lower court to decide a case within the reglementary period, which is
within three (3) months from the date of submission for decision, warrants administrative sanction.
A judicial audit and inventory of pending cases was conducted by the Office of the Court
Administrator (OCA), in RTC Branch 27, Sta. Cruz, and in Branch 74, Malabon. Judge Leonida was the
presiding judge of Branch 27 and assisting judge of Branch 74.
The then Court Administrator issued a Memorandum on the audit team’s findings, and in its
evaluation of the charges against Judge Leonida, the OCA recommended that for his failure to resolve
motions in ten (10) civil cases; decide eleven (11)criminal cases, and twenty-seven (27) civil cases in
Branch 27, and to decide ninety-one (91) criminal cases and sixteen (16) civil cases in Branch 74, he
be found guilty of gross incompetency and inefficiency, and fined the amount of P50,000.00 pesos to
be deducted from his retirement benefits.
ISSUE
Whether or not Judge Leonida should be held administratively liable for his failure to decide
the cases within the reglementary period.
RULING:
YES. The failure of a judge to decide a case within the reglementary period warrants
administrative sanction. The Court treats such cases with utmost rigor for any delay in the
administration of justice; no matter how brief, deprives the litigant of his right to a speedy disposition
of his case. Not only does it magnify the cost of seeking justice; it undermines the people’s faith and
confidence in the judiciary, lowers its standards and brings it to disrepute.
No less than Section 15 (1), Article 8 of the 1987 Constitution mandates that all cases or
matters filed before all lower courts shall be decided or resolved within three (3) months from the
date of submission. The prescribed period is a firm mandatory rule for the efficient administration of
justice, prevention of needless delays, and for the orderly and speedy discharge of judicial
business. In the same vein, Canon 3, Rule 3.05 of the Code of Judicial Conduct is emphatic in enjoining
judges to administer justice without delay by disposing of the courts business promptly and deciding
cases within the period prescribed by law. Only in certain meritorious cases, that is, those involving
difficult questions of law or complex issues, may a longer period to decide the case be allowed but
only upon proper application for extension of the period has been made by the concerned judge.
In this case, the findings of the OCA showed that Judge Leonida failed to decide almost 150
cases. Judge Leonida openly admitted his culpability in the delay of disposition of cases. He cannot
take refuge behind the common excuse of heavy caseload to justify his failure to decide and resolve
cases promptly. He could have asked the Court for a reasonable period of extension to dispose of the
cases but did not.
JOSEFINA NAGUIAT v. JUDGE MARIO B. CAPELLAN

A.M. No. MTJ-11-1782, 23 March 2011, FIRST DIVISION, (Velasco, JR., J.)
The Court has time and again admonished judges to be prompt in the performance of their
solemn duty as dispenser of justice, since undue delays erode the people’s faith in the judicial system.
Naguiat was the president and general manager of the plaintiff corporation in an ejectment
case which the corporation filed. According to the complaint filed against Judge Capellan, the
corporation, pursuant to the orders of the court, submitted its position paper. Over seven months
after its receipt of the last position paper, the MTCC, presided by Judge Capellan, issued an order
dismissing the case on the ground that the corporation’s representative lacked the personality to file
the said ejectment case. Judge Capellan admitted the filing of the pleadings adverted to, except as to
the filing by the corporation of its position paper. He attributed the delay in rendering judgment to
the numerous pleadings that had to be filed, postponements, and the purported failure of Naguiat to
file its position paper. He went on to state that in barely four months from the date of the filing of the
case, he had conducted and terminated the pre-trial conference and ordered the submission of
position papers. The Court directed the parties to file their respective papers and/or additional
evidence. Upon referral by the Court, the Office of Court Administrator (OCA) found the commission
of at least four procedural lapses that caused unnecessary delay in the final resolution of the civil
case. The OCA, thus, recommended that Judge Capellan be adjudged guilty, as charged, and penalized
accordingly.
ISSUE:
Whether or not Judge Capellan shall be held guilty for undue delay
RULING:
YES. Indeed, Judge Capellan committed several lapses in his handling and eventual
disposition of the civil case. In his Order, Judge Capellan dismissed the civil case on the ground that
one Joseph Jacob, Naguiat’s representative, was not authorized to appear for the corporation because
his authority, as reflected in the corporate secretary’s certificate appended to the complaint, was for
another case. In effect, the ground for dismissing the civil case existed and was apparent upon the
filing of the basic complaint. Yet, Judge Capellan allowed the case to unnecessarily drag on for more
than five years. Another procedural lapse attributable to Judge Capellan relates to his having allowed
several unnecessary postponements which contributed to the delay in the resolution of what was
otherwise a simple case. Judge Capellan did not exert his authority to expedite the summary
proceedings of the case. He was oblivious to the basic objectives of summary procedures, one of
which is to obviate dilatory practices and unnecessary delays which have long been the bane of
ejectment proceedings. Given the summary nature of ejectment proceedings, allowing 14
postponements during the preliminary conference stage of the case strikes this Court as not only
highly inappropriate but well-nigh improvident.
ATTY. RANDY P. BARENG v. JUDGE ZENAIDA R. DAGUNA

A.M. No. RTJ-10-2246, 1 June 2011, THIRD DIVISION (BRION, J.)
Rule 3 of the Code of Judicial Conduct provides for a judge’s diligent discharge of his
administrative responsibilities, professional competence in court management, and performance of the
administrative functions or other judges and court personnel.
Atty. Bareng is the counsel of one of the accused in a criminal case for double murder. The
consolidated cases were subsequently re-raffled to the RTC Manila, Branch 19, presided by Judge
Daguna. Atty. Bareng accused Judge Daguna of gross misconduct and manifest abuse of functions of
her office. Allegedly, Judge Daguna acknowledged that she had knowledge of the failure to mail her
31 July 2007 Order; that her 21 May 2008 Order giving due course to the Notice of Appeal was not
released on time; and that she attempted to escape responsibility as regards the failure of the court
staff in mailing the said twin Orders by stating that they were resolved on time. Judge Daguna’s
issuance of the 31 July 2007 Order is beyond the 90-day reglementary period reckoned from the
Motion for Reconsideration dated 31 January 2007.
ISSUE:
Whether or not Judge Dacuna is guilty of gross misconduct and manifest abuse of functions
of her office.
RULING:
YES. Judge Daguna violated Rule 3 of the Code of Judicial Conduct which provides for a judge’s
diligent discharge of his administrative responsibilities, professional competence in court
management, and performance of the administrative functions or other judges and court personnel.
There was also a delay in sending the records of the appealed case to the CA. Rule 3.05, Canon 3 of
the Code of Judicial Conduct provides that a judge shall dispose of the courts business promptly and
decide cases within the required periods.
In addition to gross inefficiency, Judge Daguna is also guilty of delay in rendering an order, as
well as delay in transmitting the records of a case. Based on Rule 140 of the Rules of Court, the penalty
for a less serious charge is either suspension or a fine.
Competence of Judges
SPOUSES DEMOCRITO AND OLIVIA LAGO vs. JUDGE GODOFREDO B. ABUL, JR.
A.M. No. RTJ-10-2255, 17 January 2011, SECOND DIVISION (Nachura, J.)
Though not every judicial error bespeaks ignorance of the law or of the rules, and that, when
committed in good faith, does not warrant administrative sanction, the rule applies only in cases within
the parameters of tolerable misjudgment. When the law or the rule is so elementary, not to be aware of
it or to act as if one does not know it constitutes gross ignorance of the law.
Spouses Lago were the defendants in a civil action filed before Judge Abul’s court. Spouses
Lago filed a complaint charging Judge Abul of the RTC with acts and omissions violative of the
Standards of Conduct Prescribed for Judges by Law, the Rules of Court, and the Code of Judicial
Conduct, particulary: (1) when the civil complaint with prayer for the issuance of a TRO was filed,
Judge Abul assumed jurisdiction thereon and, without the mandated raffle and notification and
service of summons to the adverse party, issued a 72-hour TRO; (2) when Judge Abul set the case for
summary hearing, purportedly to determine whether the TRO could be extended for another period,
when the hearing should be set within 72 hours from the issuance of the TRO; (3) when he eventually
granted an extension of an already expired TRO to a full 20-day period; and (4) when he issued a writ
of preliminary injunction in favor of the adverse party without prior notice to the Spouses Lago and
without the required hearing.
The Office of the Court Administrator (OCA) found that Judge Abul was grossly ignorant of
the law and rules of procedure, and recommended that he be meted a fine, with a stern warning that
a repetition of the same or any similar infraction shall be dealt with more severely.
ISSUE:
Whether or not Judge Abul should be held administratively liable.
RULING:
YES. Judge Abul’s acts are contrary to what is prescribed by Rule 58 of the Rules of Court on
preliminary injunction. Though not every judicial error bespeaks ignorance of the law or of the rules,
and that, when committed in good faith, does not warrant administrative sanction, the rule applies
only in cases within the parameters of tolerable misjudgment. When the law or the rule is so
elementary, not to be aware of it or to act as if one does not know it constitutes gross ignorance of
the law. One who accepts the exalted position of a judge owes the public and the court proficiency in
the law, and the duty to maintain professional competence at all times. When a judge displays an
utter lack of familiarity with the rules, he erodes the confidence of the public in the courts. A judge is
expected to keep abreast of the developments and amendments thereto, as well as of prevailing
jurisprudence. Ignorance of the law by a judge can easily be the mainspring of injustice.
In the absence of fraud, dishonesty, or corruption, the acts of a judge in his judicial capacity
are not subject to disciplinary action. However, the assailed judicial acts must not be in gross
violation of clearly established law or procedure, which every judge must be familiar with. Every
magistrate presiding over a court of law must have the basic rules at the palm of his hands and
maintain professional competence at all times.
OFFICE OF THE COURT ADMINISTRATOR vs. JUDGE BENJAMIN P. ESTRADA and JUDGE
JOSEFINA GENTILES-BACAL
A.M. No. RTJ-09-2173, 18 January 2011, EN BANC (Brion, J.)
The intention to uphold the right of the accused to liberty cannot justify their action in excess of
their authority, in violation of existing regulations. The vacuum in a first level court created by the
absence of a presiding judge, is not remedied by a take-over of the duties of the still-to-be appointed or
designated judge for the court.
Anomalies were found by the officer-in-charge of the Court Management Office. Several
orders were issued by RTC Judge Gentiles-Bacal and RTC Judge Estrada dismissing the cases then
pending in the MTCC. The OCA found Judge Estrada and Judge Bacal guilty of gross ignorance of the
law for taking cognizance of cases pending before another court, the MTCC. The two judges admitted
the acts, although they tried to avoid liability by professing that they did not intend to violate the law
and that they acted as they did out of their desire to uphold the right of the accused to liberty in the
cases they took cognizance of. The OCA recommended that both judges be fined P40,000.00.
ISSUE:
Whether or not Judge Estrada and Judge Gentiles-Bacal should be held administratively liable.
RULING:
YES. There is no question about the guilt of the two judges. Their shared intention to uphold
the right of the accused to liberty cannot justify their action in excess of their authority, in violation
of existing regulations. The vacuum in a first level court, such as the MTCC created by the absence of
a presiding judge, is not remedied by a take-over of the duties of the still-to-be appointed or
designated judge for the court, which exactly was what Judge Estrada and Judge Bacal did. The
remedy lies in the Guidelines in the Selection and Appointment of Executive Judges and Defining their
Powers, Prerogatives and Duties, which provides that, Judge Bacal, as executive judge of the RTC,
should have designated a municipal judge within her area of supervision, to act on the pending cases.
She took time (two months as she claimed) in making the designation, which delayed action, by itself,
is a negative reflection on her performance as an executive judge. Clearly, Judge Estrada and Judge
Bacal are guilty of gross ignorance of the law.
IMELDA R. MARCOS vs. JUDGE FERNANDO VIL PAMINTUAN

A.M. No. RTJ-07-2062, 18 January 2011, EN BANC (Per Curiam)
The judiciary cannot keep those who cannot meet the exacting standards of judicial conduct and
integrity. This being so, in the performance of the functions of their office, judges must endeavour to act
in a manner that puts them and their conduct above reproach and beyond suspicion. They must act
with extreme care for their office indeed is burdened with a heavy load of responsibility.
Marcos filed a complaint-affidavit charging Judge Pamintuan with Gross Ignorance of the Law
for reversing motu proprio the final and executory order of then Acting Presiding Judge Antonio
Reyes in a civil case. The Office of the Court Administrator (OCA) recommended that Judge
Pamintuan be dismissed from the service for Gross Ignorance of the Law and for violation the Code of
Judicial Conduct.
ISSUE:
Whether or not Judge Pamintuan should be held administratively liable for allegedly
modifying an already final and executor judgment.
RULING:
YES. It is axiomatic that when a judgment is final and executory, it becomes immutable and
unalterable. It may no longer be modified in any respect either by the court which rendered it or even
by this Court. The doctrine of immutability and inalterability of a final judgment has a two-fold
purpose, to wit: (1) to avoid delay in the administration of justice; and (2) to put an end to judicial
controversies, at the risk of occasional errors. Controversies cannot drag on indefinitely.
It is inexcusable for Judge Pamintuan to have overlooked such basic legal principle no matter
how noble his objectives were at that time. Judges owe it to the public to be well-informed, thus, they
are expected to be familiar with the statutes and procedural rules at all times. When the law is so
elementary, not to know it or to act as if one does not know it, constitutes gross ignorance of the law.
Verily, he failed to conform to the high standards of competence required of judges under the Code
of Judicial Conduct. Competence is a mark of a good judge. When a judge exhibits an utter lack of
know-how with the rules or with settled jurisprudence, he erodes the public’s confidence in the
competence of our courts. Ignorance of the law, which everyone is bound to know, excuses no
one - not even judges.
Notably, this is not Judge Pamintuan’s first and sole administrative case. He must bear in
mind that membership in the judiciary circumscribes one’s personal conduct and imposes upon him
certain restrictions, the faithful observance of which is the price one has to pay for holding such a
distinguished position. His conduct must be able to withstand the most searching public scrutiny, for
the ethical principles and sense of propriety of a judge are essential to the preservation of the people’s
faith in the judicial system lest public confidence in the judiciary would be eroded by the
incompetent, irresponsible and negligent conduct of judges. The Court cannot take his previous
infractions lightly. His violations are serious in character. Having been previously warned and
punished for various infractions, Judge Pamintuan now deserves the ultimate administrative penalty
− dismissal from service.
IN THE MATTER OF THE CHARGES OF PLAGIARISM, ETC. AGAINST ASSOCIATE JUSTICE

MARIANO C. DEL CASTILLO.
A.M. No. 10-7-17-SC, 12 October 2010, EN BANC (PER CURIAM)
Only errors of judges tainted with fraud, corruption, or malice are subject of disciplinary action.
Malicious intent was viewed as an essential element, as plagiarism is essentially a form of fraud where
intent to deceive is inherent.
The judicial system is based on the doctrine of stare decisis, which encourages courts to cite
historical legal data, precedents, and related studies in their decisions.
SC Justice Del Rosario is the ponente of the decision on Vinuya, et al. v. Executive Secretary
decision, where the petition was dismissed. The counsels for petitioners Vinuya, et al., Attys. Harry
Roque and Rommel Bagares, filed a Supplemental Motion for Reconsideration on July 19, 2010
raising the plagiarism allegedly committed by Justice del Castillo for using the works of three foreign
legal authors. Three sources from foreign legal authors, an article published in the Yale Law Journal
of International Law, a book published by the Cambridge University Press, and an article published
in the Case Western Reserve Journal of International Law, were twisted and used without proper
attribution and made to look that these sources support the judgement’s arguments in dismissing
their petition when in fact, these sources even make a firm case for the petition’s claims.
ISSUE:
Whether or not Justice del Castillo is guilty of the plagiarism case.
HELD:
NO. The Court dismisses the plagiarism charges against Justice del Castillo. The attributions
were accidentally deleted and were present in the original drafts of Justice del Castillo. Malicious
intent was viewed as an essential element, as “plagiarism is essentially a form of fraud where intent
to deceive is inherent.” Plagiarism as defined in Black’s Dictionary of Law, the deliberate and knowing
presentation of another person’s original ideas or creative expressions as one’s own. The Court
declared that “plagiarism presupposes intent and a deliberate, conscious effort to steal another’s
work and pass it off as one’s own.” Justice del Castillo never intended to claim as the original author
of the passages.
The Court, thus, declared that “only errors of judges tainted with fraud, corruption, or malice
are subject of disciplinary action” and these were not present in Justice del Castillo’s case; the failure
was not attended by any malicious intent not to attribute the lifted passages to the foreign authors.
While the academic publishing model is based on the originality of the writers thesis, the judicial
system is based on the doctrine of stare decisis, which encourages courts to cite historical legal data,
precedents, and related studies in their decisions. The judge is not expected to produce original
scholarship in every respect. The strength of a decision lies in the soundness and general acceptance
of the precedents and long held legal opinions it draws from.
GAUDENCIO B. PANTILO III v. JUDGE VICTOR A. CANOY

A.M. No. RTJ-11-2262, 9 February 2011, FIRST DIVISION (VELASCO, JR., J.)
Grant of bail despite the absence of any application or petition is a clear deviation from the
procedure laid down in Sec. 17 of Rule 114 of the Revised Rules on Criminal Procedure and may warrant
a penalty of fine.
Pantilo charged Judge Canoy with several counts of gross ignorance of the law and
procedures, grave abuse of authority, and appearance of impropriety, alleging that the accused in the
homicide case against Pantilo’s brother had been released from detention upon the order of Judge
Canoy after the accused posted bail in the amount of PhP 30,000. However, Pantilo learned that no
Information had yet been filed in Court that would serve as the basis for the approval of the bail.
ISSUE:
Whether or not Judge Canoy is guilty of violation of Supreme Court Rules and directives.
RULING:
YES. Rule 114 of the Revised Rules on Criminal Procedure allows that any person in custody
who is not yet charged in court may apply for bail with any court in the province, city or municipality
where he is held. In the case at bar, the accused did not file any application or petition for the grant
of bail with the RTC. Despite the absence of any written application, Judge Canoy verbally granted
bail. This is a clear deviation from the procedure laid down in Rule 114. Worse, Judge Canoy did not
require Melgazo to sign a written undertaking containing the conditions of the bail under Sec. 2, Rule
114 to be complied with by Melgazo. As regards the insistence of Judge Canoy that such may be
considered as constructive bail, there is no such species of bail under the Rules. Hence, Judge Canoy
is guilty of violation of Supreme Court rules, directives, and circulars. He is meted the penalty of Php
11,000 and is sternly warned that a repetition of similar or analogous infractions in the future shall
be dealt with more severely.
JOSEPHINE JAZMINES TAN v. JUDGE SIBANAH E. USMAN

A.M. No. RTJ-11-2666, 15 February 2011, EN BANC (CARPIO MORALES, J.)
Failure to follow basic legal commands as prescribed by law and the rules is tantamount to gross
ignorance of the law which may be penalized by dismissal, suspension or fine.
Tan claims that during the hearing of the Motion for Inhibition, Judge Usman became very
emotional, coerced her to testify without the assistance of counsel, and demanded a public apology
from her; and that while she requested to refer the motion to the Executive Judge, Judge Usman
interrogated her relentlessly following which he issued an order citing Tan in contempt. Judge Usman
explained that since he issued his Order in an official capacity, the remedy of Tan was to file a motion
for reconsideration or an appeal, not an administrative case and that he gave complainant a
maximum of 30 days detention to give her a wider opportunity to either apologize or divulge the
name of her informant, so that even before the expiration of the period, the court can lift the Order
of Contempt.
ISSUE:
Whether or not Judge Usman is grossly ignorant of the law.
RULING:
YES. Failure to follow basic legal commands as prescribed by law and the rules is tantamount
to gross ignorance of the law. Contrary to Judge Usman’s claim, Tan has no remedy of appeal but may
avail of the remedies of certiorari or prohibition, as provided by Section 2 of Rule 71. The penalty for
direct contempt if imprisonment is imposed should not, as Section 1 of Rule 71 provides, exceed 10
days. Moreover, an order of direct contempt is not immediately executory or enforceable.
Under Section 8(9), Rule 140 of the Rules of Court, gross ignorance of the law or procedure
being classified as a serious charge for which the imposable penalty may be dismissal from the
service, forfeiture of all or part of the benefits, suspension from office without salary and other
benefits for more than three but not exceeding six months; or a fine of more than P20,000.00 but not
exceeding P40,000.00. Judge Sibanah Usman is fined in the amount of P30,000.
LYDELLE L. CONQUILLA v. JUDGE LAURO G. BERNARDO

A.M. No. MTJ-09-1737, 09 February 2011, SECOND DIVISION (CARPIO, J.)
Under Section 8(9), Rule 140 of the Rules of Court, gross ignorance of the law or procedure is
classified as a serious charge for which the imposable penalty may be dismissal, suspension or fine.
A criminal complaint for direct assault was filed against Conquilla before the MTC. Judge
Bernardo conducted a preliminary investigation and found probable cause to hold Conquilla for trial.
Judge Bernardo then issued a warrant of arrest with the bail fixed at P12,000. Upon motion of
Conquilla, Judge Bernardo issued an order reducing the bail to P6,000. On the same date, Conquilla
posted cash bail of P6,000 for her provisional liberty. Conquilla then filed an administrative
complaint, alleging that first level court judges no longer have the authority to conduct preliminary
investigations. Conquilla further submits that Judge Bernardo usurped the power of the prosecutor,
who was not even given the chance to comment on Conquilla’s Motion to Reduce Bail. Furthermore,
Conquilla alleged that when she learned about the warrant of arrest, she called Judge Bernardo’s wife,
who said she would help in having the bail reduced to P6,000.00 and would have the case for direct
assault against herein complainant dismissed provided herein Conquilla cancel the wife’s debt of
P35,000.00 and grant her another loan.
ISSUE:
Whether or not Judge Bernardo is guilty of gross ignorance of the law which would warrant
a suspension.
RULING:
YES. Rule 112 of the Revised Rules on Criminal Procedure, provides that the preliminary
investigation of cases falling under the original jurisdiction of the MTC shall be conducted by the
prosecutor. Clearly, MTC judges are no longer authorized to conduct preliminary investigation. It was
therefore incumbent upon Judge Bernardo to forward the records of the case to the Office of the
Provincial Prosecutor for preliminary investigation, instead of conducting the preliminary
investigation himself. While Rule 114 of the Rules of Court allows a judge to grant bail in bailable
offenses and to increase or decrease bail, it assumes that the judge has jurisdiction over the case. In
this case, Judge Bernardo conducted the preliminary investigation without authority and issued the
warrant of arrest. Thus, these acts are void for want of jurisdiction. Under Rule 140, gross ignorance
of the law or procedure is classified as a serious charge for which the imposable penalty may be
dismissal from the service, forfeiture of all or part of the benefits, suspension from office without
salary and other benefits for more than three but not exceeding six months; or a fine of more than
P20,000.00 but not exceeding P40,000.00.
Moreover, Canon 4 of the New Code of Judicial Conduct stresses the importance of propriety
and the appearance of propriety to the performance of all the activities of a judge. Furthermore,
judges and members of their families are prohibited from asking for or accepting any gift, bequest,
loan or favor in relation to anything done or to be done or omitted to be done by him in connection
with the performance of judicial duties.
MARCIANO ALCARAZ v. JUDGE FATIMA GONZALES-ASDALA

A.M. No. RTJ-11-2272, 16 February 2011, FIRST DIVISION (PEREZ, J.)
A judge may not be held administratively accountable for not acting upon a motion with a
defective notice of hearing.
Alcaraz filed with the Office of the Ombudsman a Complaint-Affidavit charging Judge Fatima
Gonzales-Asdala of neglect or refusal to act on matters pending before her sala, in violation of Section
3(f) of Republic Act No. 3019. As chief basis of the charge, Alcaraz cited Judge Gonzales-Azdala’s
inexcusable failure to act on the Emelita Mariano’s motion for execution pending appeal for an
ejectment case where Mariano obtained a favorable decision.
ISSUE:
Whether or not Judge Gonzales-Asdala is guilty of undue delay or absolute neglect in

resolving Mariano’s motion.
RULING:
NO. No administrative fault may be attributed on the part of Judge Gonzales-Asdala. The Rules
of Court require every written motion, except those that the court may act upon without prejudicing
the rights of an adverse party, to be set for hearing by its proponent. When a motion ought to be
heard, the same rules prescribe that it must be served to the adverse party with a notice of hearing.
An inspection of Emelita’s motion for execution pending appeal discloses a defective notice of
hearing. The notice was directed to the Branch Clerk of Court instead of being addressed to the
adverse party. The notice also failed to specify a date and time of the hearing. Therefore, the motion
is a mere scrap of paper.
Accordingly, a judge may not be held administratively accountable for not acting upon a mere
scrap of paper. To impose upon judges a positive duty to recognize and resolve motions with
defective notices of hearing would encourage litigants to an unbridled disregard of a simple but
necessary rule of a fair judicial proceeding.
RENE C. RICABLANCA v. JUDGE HECTOR B. BARILLO

A.M. No. MTJ-08-1710, 15 February 2011, EN BANC (CARPIO MORALES, J.)
When the law is so elementary, not to be aware of it constitutes gross ignorance of the law since
a judge, having applied for the position and appointed as such, is presumed to know the law.
While Judge Barillo was still Acting Presiding Judge of the MTC, he issued orders archiving
five criminal cases cognizable by the RTC, instead of forwarding them to the Office of the Provincial
Prosecutor for review and appropriate action. Ricablanca, Court Stenographer I of the MTC charged
Judge Barillo with Grave Judicial Misconduct and Gross Ignorance of the Law.
ISSUE:
Whether or not Judge Barillo is guilty of gross ignorance of the law.
RULING:
YES. In issuing the orders archiving the five criminal cases, Judge Barillo failed to consider
that he was acting not as a trial judge but an investigating judge of an MTC whose actions were thus
governed by Section 5, Rule 112 of the Rules of Criminal Procedure on preliminary investigations. He
ought to have known that after conducting preliminary investigation on the criminal cases, it was his
duty to transmit his resolution thereon to the provincial or city prosecutor for appropriate action.
His failure to do so betrays an utter lack of familiarity with the Rules.
The complaint against Judge Barillo is for gross ignorance of the law in which the acts
complained of must not only be contrary to existing law and jurisprudence; it must have been
motivated by bad faith, fraud, dishonesty or corruption the presence of which in the present case is
not clear. Be that as it may, such leeway afforded a judge does not mean that he should not evince
due care in the performance of his adjudicatory functions. Sanctions are still in order as such lapses
in judgment cannot be countenanced. A judge, having applied for the position and appointed as such,
is presumed to know the law. Thus, when the law is so elementary, not to be aware of it constitutes
gross ignorance of the law. A judge owes it to himself and his office to know basic legal principles by
heart and to harness that knowledge correctly and justly, failing which public’s confidence in the
courts is eroded.
JUDGE NAPOLEON INOTURAN v. JUDGE MANUEL Q. LIMSIACO, JR.,

A.M. No. MTJ-01-1362, 22 February 2011, EN BANC (PER CURIAM)
Despite lack of bad faith, fraud, dishonesty, and corruption, gross ignorance of the law may be
found in a case which speaks of suspicious circumstances affecting the Judge’s integrity and competence.
Executive Judge Garvilles found that the supposed property bond by one accused in criminal
cases allegedly approved by Judge Manuel Limsiaco does not exist. Moreover, Judge Limsiaco acted
without authority when he approved the property bond despite the fact that the application for bail
should have been filed with any of the 14 Branches of the Bacolod City Regional Trial Court. Judge
Garvilles also found that Judge Limsiaco ordered the release of some accused although they did not
post bail.
ISSUE:
Whether or not Judge Limsiaco is guilty of gross ignorance of the law.
RULING:
YES. Judge Limsiaco failed to give a satisfactory explanation why he issued the Release Order
although accused Balucero did not post bail and was not under detention. Likewise, as stated by Judge
Garvilles, respondent judge acted without authority in approving Baluceros alleged application for
bail. Section 17, Rule 114 of the Revised Rules of Criminal Procedure provides that if the accused is
arrested in a province, city of municipality, other than where the case is pending, bail may be filed
with any Regional Trial Court of said place, or if no judge thereof is available, with any metropolitan
trial judge, municipal trial judge, or municipal circuit trial judge therein. Here, Judge Limsiaco should
not have approved Baluceros application for bail. It is only one of the 14 Branches of the RTC in
Bacolod City which has the authority to act thereon.
Clearly, Judge Limsiaco blatantly disregarded the Rules and settled jurisprudence
tantamount to gross ignorance of the law. To constitute gross ignorance of the law, the acts
complained of must not only be contrary to existing law and jurisprudence, but were motivated by
bad faith, fraud, dishonesty, and corruption. The facts obtaining in this case speak of suspicious
circumstances affecting Judge Limsiaco’s integrity and competence too glaring to ignore.
Canon 1 (Rule 1.01) of the Code of Judicial Conduct provides that a judge should be the
embodiment of competence, integrity and independence. Canon 3 states that a judge should perform
his official duties honestly and with impartiality and diligence. By his actuations, Judge Limsiaco has
shown his incompetence and lack of integrity which obviously blemish the image of the judiciary.
LYDIA A. BENANCILLO v. Judge VENANCIO J. AMILA

A.M. No. RTJ-08-2149, 9 March 2011, FIRST DIVISION, (Del Castillo, J.)
Even acts that are not per se improper can nevertheless be perceived by the larger community
as such. Be it stressed that judges are held to higher standards of integrity and ethical conduct than
attorneys and other persons not [vested] with public trust.
Benancillo avers that Branch 1 of RTC Tagbilaran City, acting as the Family Court, issued a
Temporary Protection Order (TPO) against her live-in partner, Paul John Belot (Belot). The TPO
included a directive to Belot to turn over to her personal effects, including properties in their diving
business Underworld. Meanwhile, their business partners filed a motion for intervention with
respect to the properties of Underworld to which Benancillo opposed. Benancillo alleges that when
Branch 2, presided by Judge Amila, was designated as the new Family Court in Tagbilaran City, her
case was transferred to the said court. Acting on the pending incidents, Judge Amila denied both
Belot’s motion for reconsideration and the intervenors’ motion for intervention. Judge Amila
incorporated in the resolution a cease-and-desist order prohibiting the intervenors from taking
possession of the properties of Underworld. Benancillo claims that Judge Amila called her and her
counsel to a meeting in his chambers. They agreed to the meeting, but they did not proceed when
they learned that the intervenors were joining them. Subsequently, Judge Amila issued an Order
reversing his previous denial of intervenor’s motion. According to Benancillo, the Judge Amila’s
conduct smacks of impropriety and partiality. She further charges the Judge Amila with grave abuse
of discretion, gross ignorance of the law and procedure and knowingly rendering an unjust
judgment/order for issuing the questioned Orders. In Judge Amila’s comment, he said that the
"complainant . . . is only a live-in partner with no specific address who was branded repeatedly by
Belot as a ‘prostitute’ and one ‘only after his money’." The Office of the Court Administrator (OCA)
found Judge Amila acted inappropriately.
ISSUE:
Whether or not Judge Amila should be held guilty of conduct unbecoming of a judge
RULING:
YES. Judge Amila should be reminded of Sections 1 and 6, Canon 4 of the New Code of Judicial
Conduct for the Philippine Judiciary. In this case, Judge Amila acted inappropriately in calling the
complainant and the intervenors to a meeting inside his chambers. His explanation that he called the
said meeting to advice the parties that he will rescind his Order is not acceptable. This act of Judge
Amila would logically create an impression to complainant that the meeting of the judge with the
intervenors had turned his views around towards issuing a revocation of his Order. Further, it is
reprehensible for a judge to humiliate a lawyer, litigant or witness. The act betrays lack of patience,
prudence and restraint. Thus, a judge must at all times be temperate in his language. He must choose
his words, written or spoken, with utmost care and sufficient control. The wise and just man is
esteemed for his discernment. Pleasing speech increases his persuasiveness. Even acts that are not
per se improper can nevertheless be perceived by the larger community as such. Be it stressed that
judges are held to higher standards of integrity and ethical conduct than attorneys and other persons
not vested with public trust. Accordingly, Judge Amila is hereby found guilty of conduct unbecoming
of a judge.
ATTY. RAFAEL T. MARTINEZ, and SPOUSES DAN and EDNA REYES v. JUDGE GRACE GLICERIA
F. DE VERA
A.M. No. MTJ-08-1718, 16 March 2011, SECOND DIVISION, (Carpio, J.)
An administrative complaint is not the appropriate remedy for every irregular or erroneous
order or decision issued by a judge where a judicial remedy is available, such as a motion for
reconsideration, an appeal, or a petition for certiorari.
Spouses Reyes, with Atty. Martinez as counsel of record, are defendants in a case for
ejectment with damages heard before the sala of Judge De Vera. After the termination of the
preliminary conference, Sps. Reyes and Atty. Martinez averred that Judge De Vera issued a pre-trial
order directing the parties to submit their position paper within ten (10) days from receipt of the
pre-trial order. The pre-trial order was received by Atty. Martinez on November 21, 2007. Hence,
they have until December 1, 2007 within which to file their position paper. However, since the day
falls on Saturday, they filed their position paper together with their evidence by registered mail on
December 3, 2007. Judge De Vera denied the admission of the position paper on the ground that the
same was filed out of time. On January 2, 2008, Atty. Martinez filed a motion for reconsideration. On
January 6, 2008, Martinez received the adverse decision dated December 28, 2007 in favor of the
plaintiff therein. The complainants claimed that Judge De Vera, in denying the admission of their
position paper and the evidence attached to it, is obviously ignorant of the basic and elementary
provision of the rules. Sps. Reyes and Atty. Martinez filed a complaint before the Office of the Court
Administrator (OCA). OCA found Judge De Vera guilty of gross ignorance of law.
ISSUE:
Whether or not Judge De Vera should be held administratively liable for issuing the Order
denying the admission of the position paper of the complainants on the ground that the same was
filed out of time
RULING:
NO. From Judge De Vera’s Supplemental Rejoinder, we learn that "the envelope showing that
the position paper was sent through registered mail on December 3, 2007 was not stitched to the
Record and was in fact found in the drawer of a court personnel, on October 27, 2008." Contrary to
Atty. Martinez’s allegations, the circumstances surrounding the loss and subsequent discovery of the
envelope point to Judge De Vera’s good faith. We acknowledge that compared to the present
administrative proceedings, it would have been far simpler for Judge De Vera to immediately verify
the submission of complainants’ position paper to the court at the time of her preparation of the
questioned order. Albeit belated, Judge De Vera exerted reasonable efforts to rectify the errors of her
staff. The inconvenience caused by the present administrative case could be considered as sufficient
penalty against Judge De Vera, and should serve as a reminder to her to diligently discharge
administrative responsibilities, and to maintain professional competence in court management. To
constitute gross ignorance of the law, it is not enough that the subject decision, order or actuation of
Judge De Vera in the performance of her official duties is contrary to existing law and jurisprudence
but, most importantly, she must be moved by bad faith, fraud, dishonesty or corruption. Good faith
and absence of malice, corrupt motives or improper considerations are sufficient defenses in which
a judge charged with ignorance of the law can find refuge. Moreover, an administrative complaint is
not the appropriate remedy for every irregular or erroneous order or decision issued by a judge
where a judicial remedy is available, such as a motion for reconsideration, an appeal, or a petition for
certiorari.
RE: COMPLAINT OF CONCERNED MEMBERS OF CHINESE GROCERS ASSOCIATION (CGA)

AGAINST JUSTICE SOCORRO B. INTING OF THE COURT OF APPEALS
A.M. OCA IPI No. 10-177-CA-J, 12 April 2011, EN BANC (BRION, J.)
In administrative proceedings, the complainant has the burden of proving the allegations in
the complaint with substantial evidence.
Romualdo dela Cruz filed a petition for the issuance of a new owner’s duplicate copy of TCT
No. 42417, claiming that the old owner’s duplicate copy had been misplaced. This petition was
assigned to the sala of then Judge Inting, Presiding Judge of Branch IV, RTC Manila. Judge Inting issued
an order granting dela Cruz’ petition, and the new owner’s duplicate title was given to dela Cruz.
However, the Concerned Members of Chinese Grocers Association (CGA) claimed that Judge Inting
acted with gross neglect when she granted dela Cruz’ petition, pointing out that the Deed of Absolute
Sale, the basis for dela Cruz’ interest and right to file the petition, should have aroused Judge Inting’s
suspicion as it was allegedly signed on behalf of CGA by Ang E. Bio, who already died. CGA also found
it suspicious that Judge Inting did not question dela Cruz on the particulars of the sale.
ISSUE:
Whether Judge/Justice Inting is guilty of misconduct in granting Dela Cruz’ petition.
RULING:
NO. The law under Presidential Decree No. 1529 or the Property Registration Decree, clearly
allows a person who is not the owner of the property to file the petition for a new duplicate certificate,
provided the person has interest in the property. As a public document, the subject Deed of Absolute
Sale has in its favor the presumption of regularity. In the present case however, no one from CGA
appeared during the proceedings to oppose dela Cruz’ petition. Given the lack of any evidence to
assume otherwise, Justice Inting correctly relied on the notarized Deed of Sale’s presumption of
regularity. Moreover, the RTC, acting only as a land registration court with limited jurisdiction, has
no jurisdiction to pass upon the question of actual ownership of the land covered by the lost owner's
duplicate copy of the certificate of title.
In administrative proceedings, the complainant has the burden of proving the allegations in
the complaint with substantial evidence, i.e., that amount of relevant evidence which a reasonable
mind might accept as adequate to justify a conclusion. In the absence of evidence to the contrary, the
presumption that the judge regularly performed her duties will prevail.
ETHICS OF OTHER COURT EMPLOYEES
Custody of Court and Other Funds
OFFICE OF THE COURT ADMINISTRATOR vs. VICTORIO A. DION

A.M. No. P-10-2799, 18 January 2011, EN BANC (PER CURIAM)
All collections from bail bonds, rental deposits, and other fiduciary collections shall be deposited
within 24 hours by the Clerk of Court concerned, upon receipt thereof, with the Landbank of
the Philippines. Moreover, collecting officers are required to promptly issue official receipts for all
money received by them.
A financial audit of the Fiscal Monitoring Division (FMD) under the Office of the Court
Administrator (OCA) was conducted on the books of account of the Municipal Circuit Trial Court
(MCTC) of San Fabian-San Jacinto, Pangasinan. The audit team discovered unreported and
unremitted collections that Dion, its former Clerk of Court, made in connection with his duties.
Initially trying to refute the evidence presented against him, Dion eventually admitted the
misdeed. Later, he settled his accountability. The OCA recommended Dion’s dismissal for dishonesty
and grave misconduct.
ISSUE:
Whether or not Dion should be held administratively liable for failing to report and remit to
the court his collections made in connection with his duties as a former Clerk of Court.
RULING:
YES. Dion violated OCA Circular 50-95, which states that all collections from bailbonds, rental
deposits, and other fiduciary collections shall be deposited within 24 hours by the Clerk of Court
concerned, upon receipt thereof, with the Landbank of the Philippines. Likewise, he violated OCA
Circular 26-97, which directed judges and clerks of court to compel collecting officials to strictly
comply with the provisions of the Auditing and Accounting Manual citing Article VI, Sections 61 and
113 which required collecting officers to promptly issue official receipts for all money received by
them. It is evident that Dion willfully betrayed the trust placed by the Court in him as Clerk of
Court. The Court imposes the penalty of dismissal on him.
OFFICE OF THE COURT ADMINISTRATOR vs. MARISSA U. ANGELES

A.M. No. P-10-2880, A.M. No. P-11-2887; 18 January 2011; EN BANC (PER CURIAM)
Dishonesty and grave misconduct warrants dismissal from public service. There is no other
office in the government service exacts a greater demand for moral righteousness and uprightness from
an employee than in the judiciary.
MTC Judge Aldea-Arocena complained to RTC Judge Jurado, informing him of the alleged
failure of Angeles to remit/deposit cash and bail bonds and other collections of the court. On a
separate occasion, the Office of the Court Administrator (OCA) Audit Team conducted a financial
examination on the books of accounts of the MTC where Angeles is the Clerk of Court.
Upon the appointment of Judge Florendo as a replacement to Judge Jurado, she was asked to
commence investigation on Angeles. On the same day investigation was commenced, Angeles
tendered her resignation. Judge Florendo recommended Angeles’ dismissal for dishonesty and grave
misconduct on the following bases: (1) failure to immediately account for the excess in the cash bond
she received; (2) failure to issue appropriate receipts; (3) failure to safekeep monies received; and,
(4) failure to remit/deposit cash bonds in the government depository upon receipt.
ISSUE:
Whether or not Angeles should be dismissed from service.
RULING:
YES. Angeles failed to dispute or disprove the charges against her. Angeles’ resignation is of
no consequence, as there is no showing in the records that the Court accepted her resignation.
Dishonesty is defined by the Civil Service Commission (CSC) as any act of which shows lack
of integrity or a disposition to defraud, cheat, deceive or betray. It consists of an intent to violate the
truth, in a matter of fact relevant to one’s office or connected with the performance of his duties. In
the instant case, the failure of Angeles to call the appropriate attention regarding the excess of the
amount paid is an indication of predisposition to defraud her.
Clerks of Court, as accountable officers, are mandated to request receipts from proper
agencies. Thus, issuance of temporary receipts, more so none issuance at all as in this case, is a clear
violation of said prohibition as it would create doubt on the validity of said exactions and would have
an effect on the trustworthiness of the employee as well as the Court itself. Further, it is mandated
that all fiduciary collections shall be deposited immediately by the Clerk of Court concerned, upon
receipt thereof, with an authorized government depository bank (Land Bank). In the instant case,
Angeles committed a serious infraction in her failure to deposit on time the courts collection. Clearly,
there was gross neglect of duty. Her subsequent turnover of said cash deposits will not exonerate her
from liability. Clerks of Court are not supposed to keep funds in their personal possession. Even
undue delay in the remittances of the amounts that they collect at the very least constitutes
misfeasance.
OFFICE OF THE COURT ADMINISTRATOR v. MS. MIRA THELMA V. ALMIRANTE

A.M. No. P-07-2297, 21 March 211, THIRD DIVISION, (Brion, J.)
The role of the Clerks of Court as judicial officers entrusted with the delicate function in the
collection of legal fees, and they are expected to correctly and effectively implement regulations.
Requested by the presiding judge of the court, an audit team from the Office of the Court
Administrator (OCA) conducted an audit on the books of accounts of the MTC, Argao, Cebu. The
request arose from the alleged failure of Almirante to turn over to Clerk of Court the Fiduciary
Account passbook, deposit slips, and official receipts for the Judiciary Development Fund (JDF),
Special Allowance for the Judiciary Fund (SAJF) and the Fiduciary Fund (FF). Almirante served as OIC
Clerk of Court for 2005. On the recommendation of the OCA, the Court directed Almirante to explain
in writing why no disciplinary action should be taken against her for: (1) misappropriating the
exhibit money in a criminal case; (2) her failure to regularly submit her Monthly Report of Collections
and Deposits in violation of OCA Circular Nos. 32-93 and 113-2004; and (3) her failure to submit her
collections for the SAJF and the JDF on time. OCA recommended Almirante be found liable for simple
neglect of duty and be fined with an amount of Eight Thousand Pesos (P8, 000.00).
ISSUE:
Whether or not Almirante be held liable for simple neglect of duty

RULING:
YES. Almirante has been remiss in the performance of her administrative responsibilities as
then Officer-in-Charge. Her omissions partake of violations of specific rules and regulations
governing the duties and responsibilities of Clerks of Court (or their authorized substitutes) in the
collection and custody of legal funds/fees. The Court finds the OCA’s recommendation to be well-
founded except for the penalty. Indeed, Almirante should be penalized for she had been remiss in the
performance of her duties as OIC Clerk of Court. The OCA’s recommended fine, however, is not
proportionate with the penalty that could have been imposed had Almirante not been given the
chance for an early separation. Since the penalty for simple neglect is one (1) month and one (1) day
up to six (6) months suspension, the fine imposable on Almirante should at least be the equivalent of
one (1) month suspension, or P9,612.00 based on Almirante’s personnel records. In this manner,
there is proportion between the suspension that should have been imposed and the fine, as the
substitute penalty under the circumstances.
OFFICE OF THE COURT ADMINISTRATOR v. ATTY. MAGDALENA L. LOMETILLO, Former Clerk

of Court VII, VICTORIA S. PATOPATEN, Cashier II, LINDA C. GUIDES, Administrative Officer I,
LENNY GEMMA P. CASTILLO, Clerk III, and BRENDA M. LINACERO, Clerk III, All of Regional
Trial Court, Iloilo City, A.M. No. P-09-2637,
29 March 2011, EN BANC, (PER CURIAM)
The Clerks of Court perform a very delicate function as custodian of the court's funds, revenues,
records, property and premises. Hence, they are entrusted with the primary responsibility of correctly
and effectively implementing regulations regarding fiduciary funds and are thus, liable for any loss,
shortage, destruction or impairment of such funds and property.
In view of the compulsory retirement of Atty. Lometillo as the Clerk of Court, The Office of the
Court Administrator (OCA) conducted a financial audit on the books of accounts of his office in RTC
Iloilo City, covering transactions from November 1993 to February 2004. Irregularities were
unearthed by the OCA Financial Audit Team based on the Report of Collections presented and the
inventory of unused Official Receipts. OCA recommended that Atty. Lometillo be held liable for
violation of the 2002 Revised Manual for Clerks of Courts for the Initial shortages incurred in the
Clerk of Court General Fund (CCGF), Special Allowance for the Judiciary Fund (SAJF), Judiciary
Development Fund (JDF), Sheriff General Fund (SGF) and the Fiduciary Fund.
ISSUE:
Whether or not Atty. Lometillo is guilty of gross inefficiency and gross neglect of duty
RULING:
YES. It appears that Atty. Lometillo utterly failed to perform her duties with the degree of
diligence and competence expected of a clerk of court. The late deposit of collections cannot be
countenanced. Atty. Lometillo did not exert all available means to comply with the directives, like
negotiating with the depositary bank for an everyday pick-up service or requesting for police back-
up in transporting deposits to the bank. No amount of convenience or expediency can justify Atty.
Lometillo’s excuse from making arrangements with the bank for a pick-up service, thrice a week. The
rules are plain enough to command strict compliance. Atty. Lometillo should have imbibed her
primary responsibility of correctly and effectively implementing regulations regarding fiduciary
funds. Safekeeping of funds and collections is essential to an orderly administration of justice, and no
protestation of good faith can override the mandatory nature of the circulars designed to promote
full accountability for government funds. Atty. Lometillo’s failure to exhibit administrative leadership
and ability renders Atty. Lometillo guilty of negligence, incompetence and gross inefficiency in the
performance of her official duty as Clerk of Court. Thus, the penalty of dismissal from service is
proper considering her failure to exercise supervision over her administrative staff resulting in
commission of blatant infractions against the Rules.
OFFICE OF THE COURT ADMINISTRATOR v. NELIA D.C. RECIO, ET AL.

A.M. No. P-04-1813, 31 May 2011, EN BANC (PER CURIAM)
The role of clerks of courts as judicial officers entrusted with the delicate function with regard
to collection of legal fees thus the unwarranted failure to fulfill these responsibilities deserves
administrative sanction and not even the full payment of the collection shortages will exempt the
accountable officer from liability.
The Audit Team of the Court Management Office which covered the accountability period of
Clerk of Court Recio found discrepancies between the amounts recorded in the cashbook and those
reflected in the official receipts. It also discovered, as per sampling of official receipts, that the latter
appeared to be tampered on its face.
ISSUE:
Whether or not Recio is Gross Misconduct, Dishonesty and Gross Neglect of Duty.
RULING:
YES. Recio failed to present a satisfactory explanation regarding her cash shortages and to
refute the accuracy of the financial audit. Clearly, Recio's failure to remit these collections upon
demand by the Court constitutes as prima facie evidence that she has put such missing funds to
personal use. Recio likewise violated Circular No. 50-95 due to her delay in the remittance of the
court collections.
Settled is the role of clerks of courts as judicial officers entrusted with the collection of legal
fees. They are expected to correctly and effectively implement regulations relating to proper
administration of court funds. Clerks of court perform a delicate function as designated custodians of
the court's funds, revenues, records, properties and premises. As such, they are generally regarded
as treasurer, accountant, guard and physical plant manager thereof. It is the clerks of court’s duty to
faithfully perform their duties and responsibilities as such to the end that there was full compliance
with function, that of being custodians of the court’s funds and revenues, records, properties, and
premises. They are the chief administrative officers of their respective courts. Clerks of court are
officers of the law who perform vital functions in the prompt and sound administration of justice.
Their office is the hub of adjudicative and administrative orders, processes and concerns. Thus, the
unwarranted failure to fulfill these responsibilities deserves administrative sanction and not even
the full payment of the collection shortages will exempt the accountable officer from liability.
OFFICE OF THE COURT ADMINISTRATOR vs. ELSIE C. REMOROZA

A.M. No. P-05-2083, A.M. No. P-06-2263; 6 September 2011, EN BANC (Abad, J.)
The Court cannot countenance any dishonesty and malversation committed by those responsible
for safekeeping and handling of its funds. Any lenience towards their infractions will ultimately diminish
the faith and trust of the people in the judiciary.
The Audit Team of the Court conducted a financial audit of the accountabilities some court
officials of the MTC of Mauban, Quezon. The audit showed a shortage in Remoroza’s collections. The
subsidiary ledgers of the Court’s Accounting Division also showed that Remoroza and Alpajora failed
to submit their monthly reports for collections, deposits, and withdrawals involving the Judiciary
Development Fund (JDF), General Fund (GF), Special Allowance for the Judiciary Fund (SAJF) and the
Fiduciary Fund (FF).
The Court resolved to docket the report as a regular administrative complaint against
Remoroza; direct Remoroza and Alpajora to explain and restitute the shortage. Alpajora told the
Court that she had already restored the shortages required of her. What remained is the case of
Remoroza. The OCA finds Remoroza guilty of gross dishonesty and grave misconduct and
recommends her dismissal from the service. It also asks that she be directed to restitute her
shortages for the different court funds.
ISSUE:
Whether or not Remoroza committed a breach of duty a) to account for and deposit without
delay her collections of court funds and b) render the corresponding monthly report of collections,
deposits and withdrawals.
RULING:
YES. The Court cannot countenance any dishonesty and malversation committed by those
responsible for safekeeping and handling of its funds. Any lenience towards their infractions will
ultimately diminish the faith and trust of the people in the judiciary. Remoroza deserves to be
dismissed from the service, with forfeiture of all her leave credits and retirement privileges and with
prejudice to reemployment in any branch or instrumentality of the government. She must also
restitute her shortages.
Notably, respondent Remoroza repeated exactly the same offenses for which she was
previously found guilty and penalized. She is apparently incorrigible. What makes the matter worse
is that she had returned to work barely five months and yet she already incurred huge shortages
affecting four separate court funds placed in her safekeeping. Remoroza also twice requested for
additional time to submit her written explanation to the audit results yet did not. She also snubbed
the Courts show cause order. Her defiance demonstrates extreme insolence and arrogance, making
her unfit for government service.
Impartiality and Conflicts of Interest
MILAGROS VILLACERAN and OMAR T. MIRANDA v. Judge MAXWEL S. ROSETE and Process
Server EUGENIO TAGUBA
A.M. No. MTJ-08-1727, 22 March 2011, EN BANC, (PER CURIAM)
Court personnel shall not solicit or accept any gift, favor or benefit based on any or explicit
understanding that such gift, favor or benefit shall influence their official actions.
Villaceran and her husband were the accused for violation of Batas Pambansa Blg. 22 with
the MTCC. Another judge initially heard the case, but upon his inhibition, the cases were re-raffled to
another branch presided over by Judge Rosete. Villaceran alleged that her lawyer, Atty. Edmar
Cabucana, assured her that the change of judge was advantageous to them because the Judge Rosete
was easier to talk to, was an associate in their law firm, and was his brother’s schoolmate. After their
presentation of evidence, Atty. Cabucana told her to produce P50,000.00 for Judge Rosete in exchange
for a favorable decision. Taguba, the process server, subsequently asked about the money and
informed her that Judge Rosete had drafted a decision acquitting them. Villaceran instructed their
driver to deliver the amount to the office of Atty. Cabucana, and to demand a receipt therefor. Their
driver returned with a provisional receipt duly signed by Taguba. After referral by the Court, the
Investigating Judge recommended that Judge Rosete be exonerated from the charge against him for
insufficiency of evidence. He noted that Villaceran had no personal knowledge of the corrupt practice
attributed to Judge Rosete. Upon referral of the case to the Office of the Court Administrator (OCA),
the OCA reocommended that Taguba be held guilty of corruption and be dismissed from the service.
ISSUES:
Whether or not Taguba shall be held guilty of corruption
RULING:
YES. Court personnel are expected to act and behave in a manner that should uphold the
honor and dignity of the Judiciary, if only to maintain the people's confidence in the Judiciary. This
expectation is enforced by Section 2, Canon I of the Code of Conduct for Court Personnel which
mandates that "[c]ourt personnel shall not solicit or accept any gift, favor or benefit based on any or
explicit understanding that such gift, favor or benefit shall influence their official actions." Section
2(e), Canon III, on the other hand, mandates that "[c]ourt personnel shall not x x x [s]olicit or accept
any gift, loan, gratuity, discount, favor, hospitality or service under circumstances from which it could
reasonably be inferred that a major purpose of the donor is to influence the court personnel in
performing official duties." Taguba clearly violated the norms of conduct as the allegations against
him stood completely uncontroverted. Taguba's act of collecting or receiving money from a litigant
constitutes grave misconduct in office. Grave misconduct is a grave offense that carries the extreme
penalty of dismissal from the service even on a first offense. Dismissal carries with it the forfeiture of
retirement benefits, except accrued leave credits, and perpetual disqualification from re-
employment in the government service.
The Court notes that Taguba has been suspended twice before. At any rate, the penalty of
dismissal can no longer be imposed because the Court approved Taguba’s application for disability
retirement. In lieu of dismissal, given the gravity of respondent Taguba’s offense, the disability
retirement benefits still due him is declared forfeited.
DANELLA G. SONIDO v. JOSEFINA G. ILOCSO, Clerk III, Regional Trial Court, Branch 80,
Morong, Rizal
A.M. No. P-10-2794, 01 June 2011, THIRD DIVISION (BRION, J.)
Acts that constitute conduct prejudicial to the best interest of the service refer to acts or
omissions that violate the norm of public accountability and diminish or tend to diminish the people’s
faith in the judiciary.
Sonido filed an administrative complaint against Clerk III Ilocso for Obstruction of Justice and
Grave Misconduct. Sonido alleged that Ilocso repeatedly failed to give her a copy of the warrant
pursuant to a criminal complaint Sonido filed. Despite Ilocso’s assurance to Sonido that copies of the
warrant had already been mailed to the proper authorities for implementation, Sonido learned from
the authorities that there was no such warrant issued or implemented resulting to the failure to
arrest the accused in the criminal case because the accused has left the country. In her defense, Ilocso
attributed the delay or omission in the preparation and release of the warrant of arrest to her heavy
workload as clerk in charge of criminal cases in a court where almost 700 cases were pending.
ISSUE:
Whether or not Ilocso is guilty of simple neglect of duty.
RULING:
NO. Ilocso’s infraction is more serious than simple neglect of duty. The delay in the release of
the warrant of arrest did not happen because Ilocso simply forgot about it or her workload was so
heavy that it took her several months to prepare and release it. The delay was by design and was not
an innocent lapse or mistake. Ilocso waited for the proper time to give Sonido a copy of the warrant
and to send copies to the implementing police authorities. The proper time obviously was when the
accused could no longer be arrested because she had already left the country. The facts all lead the
Court to conclude that the release of the warrant was delayed to favor the accused. Ilocso could not
have missed the urgency of Sonido’s request for a copy of the warrant of arrest since Sonido kept on
coming back for it. For knowingly delaying the release of the warrant of arrest, Ilocso had placed the
court in a very negative light. It prejudiced the Courts standing in the community as it projected an
image of a Court that is unable to enforce its processes on time. For this reason, we find her liable not
only for simple neglect of duty, but for the more serious offense of conduct prejudicial to the best
interest of the service.
While the Rules do not provide a definition or enumeration of the acts that constitute conduct
prejudicial to the best interest of the service, they refer to acts or omissions that violate the norm of
public accountability and diminish or tend to diminish the people’s faith in the judiciary. The Civil
Service Commission classifies conduct prejudicial to the best interest of the service as a grave offense
punishable by suspension without pay from six months and one day to one year for the first offense,
and dismissal from the service for the second offense.
Compliance with Court Procedures
MANUEL P. CALAUNAN v. REYNALDO B. MADOLARIA, SHERIFF IV, REGIONAL TRIAL COURT,

BRANCH 217, QUEZON CITY
A.M. No. P-10-2810, 08 February 2011, EN BANC (CARPIO MORALES, J)
A Sheriff who does not follow Section 10(c) of Rule 39 of the Rules of Court which requires notice
and demand constitutes simple neglect of duty, which is a less grave offense punishable by one month
and one day to six months suspension.
Calaunan contracted to purchase a house and lot at a subdivision owned by La Savoie
Development Corporation. After Calaunan had fully paid the purchase price of the property, the Deed
of Absolute Sale had not been delivered to him, as well as the title. He thus filed a complaint before
the Housing and Land Use Regulatory Board (HLURB) against La Savoie. The HLURB rendered
judgment in favor of complainant which was affirmed by the HLURB Board of Commissioners, and
eventually by the Office of the President. However, On account of a Decision the Quezon City RTC in
favor of La Savoie, the trial court issued a Writ of Execution. To enforce the Writ, a contingent
composed of armed men in fatigue uniforms, barangay officials, a few civilians, a representative from
La Savoie and Madaloria, Sheriff IV of the RTC, repaired to the subdivision. Madaloria, rudely and
arrogantly told him that he could not enter his house as it had been padlocked. Later, Calaunan
discovered that his house was already demolished, hence, spawned the present administrative case.
ISSUE:
Whether or not Sheriff Madolaria’s acts result to a misconduct which warrant suspension.
RULING:
YES. Sheriffs, as officers of the court and agents of the law, are bound to use prudence, due
care, and diligence in the discharge of their official duties. Where rights of individuals are jeopardized
by the sheriffs’ actions, they may be properly fined, suspended, or dismissed from office by virtue of
this Court’s administrative supervision over the judicial branch of the government.
In the case at bar, Sheriff Madolaria failed to comply with the procedure laid down in Section
10(c) of Rule 39 of the Rules of Court in the implementation of a writ of execution which requires that
the sheriff must first give notice of such writ and a demand to the judgment obligor to vacate the
property within three days. Only after such period can the sheriff enforce the writ by the removal of
defendant and his personal belongings. A sheriff who enforces the writ without the required notice
or before the expiration of the three-day period runs afoul with Section 10(c) of Rule 39. Failure to
observe the requirements of Section 10(c), Rule 39 of the Rules of Court constitutes simple neglect
of duty, which is a less grave offense punishable by one month and one day to six months suspension.
OFFICE OF THE COURT ADMINISTRATOR v. Atty. ROSARIO E. GASPAR

A.M. No. P-07-2325, 28 February 2011, THIRD DIVISION (BRION, J.)
Simple neglect of duty as the failure of an employee to give proper attention to a required task
or to discharge a duty due to carelessness or indifference. It is classified as a less grave offense,
punishable by suspension or fine.
An administrative charge was filed by the Office of the Court Administrator against Atty.
Rosario Gaspar, Branch Clerk of Court of the RTC of Balanga City after the audit team found records
showing her failure to issue the writs of execution in court judgments rendered against forfeited
surety bonds. The audit team found: first, the failure of Atty. Gaspar to comply with A.M. No. 04-7-02-
SC regarding the new guidelines on the documentary requirements for surety bail bond applications;
and second, the failure to issue the corresponding writs of execution on cancelled or forfeited bail
bonds.
ISSUE:
Whether or not Atty. Gaspar is liable for simple neglect of duty.
RULING:
YES. Section 1, Canon IV of the Code of Conduct for Court Personnel commands court
personnel to perform their official duties properly and with diligence at all times. As the image of the
courts, as the administrators and dispensers of justice, is not only reflected in their decisions,
resolutions or orders but also mirrored in the conduct of court personnel, it is incumbent upon every
court personnel to observe the highest degree of efficiency and competency in his or her assigned
tasks. The failure to meet these standards warrants the imposition of administrative sanctions.
Simple neglect of duty as the failure of an employee to give proper attention to a required
task or to discharge a duty due to carelessness or indifference. As distinguished from gross neglect
of duty which is characterized by want of even the slightest care, or by conscious indifference to the
consequences, or by flagrant and palpable breach of duty, there is nothing in the records to show that
Atty. Gaspar willfully and intentionally omitted to issue the subject writs of execution. Simple neglect
of duty is classified as a less grave offense, punishable by suspension without pay for one month and
one day to six months for the first offense. However, a fine may be imposed instead of the penalty of
suspension.
DY TEBAN TRADING CO., INC. v. ARCHIBALD C. VERGA

A.M. No. P-11-2914, 16 March 2011, THIRD DIVISION, (Carpio Morales, J.)
The sheriff's responsibility in the execution of a writ is mandatory and purely ministerial. Once
the writ is placed in his hand, it becomes his duty, to proceed with reasonable speed to enforce the writ
to the letter, ensuring at all times that the implementation of the judgment is not unjustifiably deferred,
unless the execution of which is restrained by the court.
Leo C. Dy, on behalf of Dy Teban Trading Co., Inc. (Dy Teban), charges Verga, Sheriff IV of RTC
with Dishonesty, Graft and Corruption, Gross Inefficiency, Neglect of Duty and Usurpation of Judicial
Authority in connection with the Writ of Execution issued by the trial court following the finality of
its decision in the case, "Dy Teban Trading Co., Inc. v. Peter Dy, et al.,". RTC granted the petition in
favor of Dy Teban. Dy laments, however, that Verga never implemented the writ as he was "cavorting
or transacting with the judgment debtors." He draws attention to Verga’s Return of Service which
shows that he did not serve copies of the writ to the judgment obligors because of an alleged decision
of the CA. Additionally, Dy faults Verga for causing the lifting of the notices of garnishment earlier
served upon the judgment obligors despite the absence of any directive for the purpose from the
court. He thus finds Verga liable for usurpation of authority of the judge. OCA gave the
recommendation that Verga be found guilty of Grave Misconduct, Dishonesty and Neglect of Duty and
be suspended from office.
ISSUE:
Whether or not Verga shall be held liable for Grave Misconduct, Dishonesty and Neglect of
Duty
RULING:
YES. A sheriff is guilty of violating the Rules of Court if he fails to observe the following: (1)
prepare an estimate of expenses to be incurred in executing the writ, for which he must seek the
court's approval; (2) render an accounting; and (3) issue an official receipt for the total amount he
received from the judgment debtor. The rule requires that the sheriff execute writs or processes to
estimate the expenses to be incurred. Upon the approval of the estimated expenses, the interested
party has to deposit the amount with the Clerk of Court and Ex-Officio Sheriff. The expenses shall then
be disbursed to the executing Sheriff, subject to his liquidation, within the same period for rendering
a return on the process or writ. Any unspent amount shall be refunded to the party who made the
deposit. A sheriff cannot just unilaterally demand sums of money from a party-litigant without
observing the proper procedural steps; otherwise, such act would amount to dishonesty or extortion.
Verga’s unilateral and repeated demands for sums of money from a party-litigant, purportedly to
defray the expenses of execution, without obtaining the approval of the trial court for such purported
expense and without rendering to that court an accounting thereof, in effect, constituted dishonesty
and extortion. That conduct, therefore, fell far too short of the required standards of public service.
MA. CHEDNA ROMERO v. PACIFICO B. VILLAROSA, JR.

A.M. No. P-11-2913, 12 April 2011, EN BANC (PER CURIAM)
Grave abuse of authority, is a misdemeanor committed by a public officer, who under color of
his office, wrongfully inflicts upon any person any bodily harm, imprisonment or other injury; it is an act
of cruelty, severity, or excessive use of authority.
Romero was the plaintiff in a claim for damages, which was settled by way of a compromise
agreement. After failing to receive the amount agreed in full, Romero filed a Motion for the Issuance
of a Writ of Execution, which the MTC granted. The judgment obligor had delivered the amount of
P20,000.00 to Sheriff Villarosa, as supported by a certification executed by the latter himself. Romero
filed an administrative complaint against Villarosa with grave abuse of authority, conduct
unbecoming of a government employee, dishonesty and estafa. Sheriff Villarosa, in his defense,
alleged that for unknown reasons, Romero refused to receive the final amount of P6,000 from him,
prompting him to deposit the amount by way of consignation with the OIC Clerk of Court of the MTC.
ISSUE:
Whether or not Sheriff Villarosa is guilty of conduct unbecoming of a government employee,

grave abuse of authority, and dishonesty, characterized by serious nonfeasance.
RULING:
YES. Sheriff Villarosa manifestly failed to observe Section 9 of Rule 39 of the Rules of Court.
Given the numerous amounts that were remitted to him by the judgment obligor on various
occasions, at no instance did he turn over such amounts within the same day that they were received
by him. Sheriffs are officers of the court who serve and execute writs addressed to them by the court,
and who prepare and submit returns on their proceedings. As officers, they must discharge their
duties with great care and diligence, perform faithfully and accurately what is incumbent upon them,
and at all times show a high degree of professionalism in the performance of their duties. In
contravention of his duties, numerous irregularities in the transactions of Sheriff Villarosa were
observed this Court such as delivery of the amounts he received directly to Romero instead of the
Clerk of Court. In the execution of judgments for money, it is the clerk of court, and not the sheriff,
who should deliver the amount to the judgment obligee.
With regard to grave abuse of authority, such has been defined as a misdemeanor committed
by a public officer, who under color of his office, wrongfully inflicts upon any person any bodily harm,
imprisonment or other injury; it is an act of cruelty, severity, or excessive use of authority. On the
other hand, dishonesty has been defined as the disposition to lie, cheat, deceive, or defraud;
untrustworthiness; lack of integrity; lack of honesty, probity or integrity in principle; lack of fairness
and straightforwardness; disposition to defraud, deceive or betray. A sheriff is a front-line
representative of the justice system in this country. Such is present in this case. Once he loses the
peoples trust, he diminishes the peoples faith in the judiciary. High standards of conduct are expected
of sheriffs who play an important role in the administration of justice.
JUDGE RENATO A. FUENTES v. ATTY. ROGELIO F. FABRO

A.M. No. P-10-2791, 6 April 2011, THIRD DIVISION (BRION, J.)
Failure of the Clerk of Court to transmit the records to the appellate court within 30 days after
the perfection of appeal, may be considered as gross negligence of duty.
Judge Fuentes wrote the Office of the Court Administrator (OCA) to report the negligence
committed by Atty. Fabro and Civil Records In-Charge Salazar, in not elevating to the CA for more
than six years the records of a civil case entitled Teodoro Polinar, et al. v. Hon. Antonio D. Laolao. In
his second letter to the OCA, Judge Fuentes again reported the negligence of Atty. Fabro and Salazar
for failing to elevate to the CA the records of another Civil Case. Atty. Fabro averred that the records
of the case have been elevated to the CA and that Salazar admitted that it was her own fault when the
record mixed up with the files of old cases.
ISSUE:
Whether or not Atty. Fabro is guilty of gross negligence of duty.
RULING:
YES. The Rules of Court provide that within 30 days after the perfection of appeal, the clerk
of court of the lower court has the duty to transmit the records to the appellate court. Judge Fuentes
gave due course to the appeals but the records were not transmitted to the CA within the 30-day
period provided in the Rules. The records of the civil case were transmitted only after more than six
years while the records of the other civil case was were mailed two years after the issuance of the
Order directing their transmittal to the CA. Clearly, Atty. Fabro, as the clerk of court of the lower court,
was grossly remiss in his duty. The fine imposed is P20,000.00 considering the number of incidents
of delay and the considerable time involved.
OFFICE OF THE COURT ADMINISTRATOR v. EFREN E. TOLOSA

Misconduct is defined as a transgression of some established or definite rule of action; more

particularly, it is an unlawful behavior by the public officer. Failure to comply with a ministerial duty is
considered as a misconduct
.
The RTC directed the Office of the Court Administrator (OCA) to take appropriate action on
its report that Tolosa, Sheriff IV of RTC, Sorsogon City, who was the one originally designated to
implement the writ of execution, violated Section 9, par. 2, Rule 39 of the Rules of Civil Procedure
when he did not turn over the checks that came into his possession to the Clerk of Court of the court
that issued the writ on the same day he received them.
ISSUE:
Whether or not Tolosa is guilty of Grave Misconduct.
RULING:
YES. Section 14, Rule 39 of the Rules of Court mandates a sheriff to make a return of the writ
of execution to the Clerk of Court or to the Judge issuing it immediately upon satisfaction, in part or
in full, of the judgment. If the judgment cannot be satisfied in full, the sheriff shall make a report to
the court within 30 days after his receipt of the writ and state why full satisfaction could not be made.
Failure of a sheriff to make periodic reports on the status of a writ of execution warrants
administrative liability. The Writ of Execution specifically directed Tolosa to enforce and implement
the decision pursuant to the provision of the Rules of Court, and to return the writ within the time
provided for by law but he simply ignored the instructions to him. A sheriff has no discretion
whatsoever with respect to the disposition of the amounts he receives. As an officer of the court,
sheriffs are chargeable with the knowledge of what is the proper action to take in case there are
questions in the writ which need to be clarified, and the knowledge of what he is bound to comply.

particularly, it is an unlawful behavior by the public officer. The misconduct is grave if it involves any
of the additional elements of corruption, and willful intent to violate the law or to disregard
established rules.
SUSANA E. FLORES v. ARIEL D. PASCASIO

Dishonesty means a disposition to lie, cheat, deceive or defraud; untrustworthiness; lack of

integrity, lack of honesty, probity or integrity in principle. Under Section 52, B(2), Rule IV of the Revised
Uniform Rules on Administrative Cases in the Civil Service, dishonesty is punishable by dismissal from
the service.
Flores filed an administrative complaint against Pascasio, Sheriff III in the MTCC Olongapo
City for Grave Misconduct and Grave Abuse of Authority. Flores claimed that Pascasio manipulated
the bidding process of levied personal properties to make it appear that Flores submitted a bid of
only P1,200.00 instead of her bid of P10,200.00. Flores further alleged that Pascasio even scolded her
for questioning the conduct of the auction sale.
ISSUE:
Whether or not Pascasio is guilty of dishonesty in the performance of official duty instead of
grave misconduct and grave abuse of authority as charged.
RULING:
YES. In disregarding the bid of Flores, which was the highest submitted bid, Pascasio violated
Section 19, Rule 39 of the Rules of Civil Procedure which directs that sale of personal property should
be made in such parcels as likely to bring the highest price.
Sheriffs play an important role in the administration of justice and high standards are
expected of them. Their conduct, at all times, must not only be characterized by propriety and
decorum but must, at all times, be above suspicion. The Court defines misconduct as any unlawful
conduct, on the part of a person concerned in the administration of justice, prejudicial to the rights
of the parties or to the right determination of the cause. It generally means wrongful, improper and
unlawful conduct motivated by a premeditated, obstinate or intentional purpose. Dishonesty means
a disposition to lie, cheat, deceive or defraud; untrustworthiness; lack of integrity, lack of honesty,
probity or integrity in principle; lack of fairness and straightforwardness; and disposition to defraud,
deceive or betray. Under the Revised Uniform Rules on Administrative Cases in the Civil Service,
dishonesty is punishable by dismissal from the service.
DEVELOPMENT BANK OF THE PHILIPPINES v. ATTY. JEOFFREY S. JOAQUINO

A.M. No. P-10-2835, 08 June 2011, SECOND DIVISION (NACHURA, J.)
Clerks of court occupy a sensitive position in the judicial system, they are required to safeguard
the integrity of the court and its proceedings.
DBP is the defendant in a civil case. The RTC rendered a partial summary judgment upon
motion of the plaintiff. The RTC directed DBP to release insurance proceeds to the plaintiff. DBP filed
a notice of appeal to the CA. The plaintiff moved for execution pending appeal of the partial judgment,
which the RTC granted. DBP asked for reconsideration but the same was denied. Joaquino issued a
writ of execution. Aggrieved, DBP filed a petition for certiorari before the CA, and in granting the
petition, the CA annulled the writs issued by the RTC. However, consequently, the appeal of DBP to
the CA pertaining to the partial summary judgment was dismissed. Joaquino issued another writ of
execution. Sheriff Alimurung sent a Notice of Sale at Public Auction to the DBP, which the DBP
opposed, contending that the decision is not yet final and executory. Alimurung proceeded with the
auction sale with various properties of DBP as the subject. DBP filed a verified letter-complaint before
the Office of the Court Administrator (OCA), charging Clerk of Court Joaquino with grave misconduct,
abuse of authority, and gross ignorance of the law.
ISSUE:
Whether or not Joaquino are guilty of gross ignorance of the Rules and dereliction of duty.
RULING:
YES. The issuance of writs of execution runs counter to the Rules. Clerks of court occupy a
sensitive position in the judicial system, they are required to safeguard the integrity of the court and
its proceedings, to earn and preserve respect therefor, to maintain loyalty thereto and to the judge
as superior officer, to maintain the authenticity and correctness of court records, and to uphold the
confidence of the public in the administration of justice. Clerks of court play a key role in the
complement of the court and, thus, cannot be permitted to slacken on their jobs under one pretext or
another. Joaquino is sternly warned that a repetition of the same or similar offense in the future shall
merit his dismissal from the service.
SUPREME COURT v. EDDIE V. DELGADO, JOSEPH LAWRENCE M. MADEJA, WILFREDO A.
FLORENDO
A.M. No. 2011-07-SC, 4 October 2011, EN BANC, (Per Curiam)
The conduct and behavior of all officials and employees of an office involved in the
administration of justice, from the highest judicial official to the lowest personnel, requires them to live
up to the strictest standard of honesty, integrity and uprightness in order to maintain public confidence
in the judiciary.
SC Associate Justice Antonio T. Carpio caused the transmittal of two (2) sealed Agenda to the
Office of Clerk of Court Second Division (OCC-SD) for the latter to prepare the minutes. Contained in
the Agenda are the itemized lists of cases taken up by the Second Division during the sessions held
on 30 May and 1 June 2011, as well as the handwritten marginal notes of Justice Carpio showing the
specific actions adopted by the division on each case item. During the initial investigation, Delgado
candidly admitted that he took pages 58, 59 and 70 from one of the copies of the 30 May 2011 Agenda
as a favor to Madeja and Florendo. As it turned out, after Delgado received the copies of the Agenda
for stitching, he was approached by Madeja and Florendo who expressed interest on certain items
apparently included in the Agenda and asked for a copy. Delgado professed that out of pakikisama,
he removed the would-be missing pages from one of the copies entrusted to him and gave them to
Madeja and Florendo. Madeja and Florendo, however, would eventually return these pages to
Delgado because, purportedly, none of the items about which they were interested was in them. The
Office of Administrative Services (OAS) considered Delgado guilty of Grave Misconduct for his
unauthorized removal of pages. The OAS also found Madeja and Florendo guilty of Conduct
Prejudicial to the Best Interest of the Service.
ISSUE:
Whether or not Delgada, Majeda and Florendo are liable for grave misconduct
RULING:
YES. Insofar as the involvement of Delgado is concerned, there is no longer any issue to be
resolved, for he has been consistent with his admission of involvement. It is, therefore, already settled
fact that Delgado was the person who actually removed the pages from the Agenda. The evidence at
hand, however, point out that Madeja and Florendo, indeed, connived with Delgado in removing the
pages. Their act of causing the removal of several pages of the Agenda is a malevolent transgression
of their duties as court personnel particularly, as employees detailed at the OCC-SD. The act is
unauthorized and a blatant disregard of the standard operating procedures observed by the office in
handling confidential documents, such as the Agenda. It compromised the ability of the OCC-SD to
efficiently perform its functions and also imperiled the environment of confidentiality the office is
supposed to be clothed with.
Court employees, as the Code of Conduct for Court Personnel puts it, serve as sentinels of
justice and any act of impropriety on their part immeasurably affects the honor and dignity of the
Judiciary and the people’s confidence in it. Delgado, Majeda and Florendo palpably failed to meet the
high standard expected from them as court employees. Their conduct is neither excusable nor
tolerable. They, through their acts, have proven themselves to be unfit for continued employment in
the judiciary.
Competence of Court Personnel
Judge PHILBERT I. ITURRALDE, MARTIN GUMARANG, et. al. vs. OIC Branch Clerk of Court
BABE SJ. RAMIREZ, Clerk VIOLETA P. FLORDELIZA and Sheriff IV CARLOS A. SALVADOR
A.M. No. P-03-1730, EN BANC, 18 January 2011, (PER CURIAM)
Those who are part of the machinery dispensing justice, from the presiding judge to the lowliest
clerk, must conduct themselves with utmost decorum and propriety to maintain the public’s faith and
respect for the judiciary. Misconduct is defined as a transgression of some established or definite rule of
action; more particularly, it is an unlawful behavior by the public officer. The misconduct is grave if it
involves any of the additional elements of corruption, willful intent to violate the law or to disregard
established rules.
Judge Iturralde, et. al. were the plaintiffs in a civil case for specific performance. The judge
therein rendered judgment based on a compromise agreement and caused the issuance of a writ of
execution. They alleged that they did not receive a copy of Judge’s order granting their motion;
neither did Ramirez issue the writ of execution. About a month after, they went to the court to inquire
about the status of their motion. They came upon clerk Flordeliza who appeared surprised and
seemed at a loss. They insisted that Flordeliza look for the records. When found, they discovered to
their dismay that the court order (with the original and all carbon copies) was still attached to the
records. At that point the defendants already had a copy of the order. When they confronted clerk
Ramirez and on their insistence and in the absence of any valid reason not to act, Ramirez was
compelled to issue the writ. However, Sheriff Salvador refused to implement the writ.
They then filed a motion for the issuance of an alias writ of execution, which the trial court
granted. Ramirez issued the alias writ, which was, however, defective as it had no case number and
the two principal defendants both natural persons were only mentioned in the case title as “ET
AL”. They believe that the defects were designed to hide the principal defendants’ identities and to
frustrate the garnishment and/or levy. After the issuance of the alias writ, for the second time,
Salvador refused to enforce the alias writ of execution.
Judge Iturralde, et. al., filed a complaint against Ramirez, et. al., for grave misconduct and
conduct prejudicial to the interest of the service. Investigator Atienza found Ramirez, et.al. liable for
the difficulties Judge Iturralde, et. al. suffered in the execution of the favorable judgment they had
secured in the civil case.
ISSUE:
1. Whether or not Clerks Ramirez and Flordeliza are administratively liable.

2. Whether or not Sheriff Salvador is administratively liable.
RULING:
Anent the first issue:

YES. The explanation by Ramirez and Flordeliza that the process of issuance and service of
court orders to parties take time cannot erase the fact that they were patently remiss in the
performance of their duties. Had Judge Iturralde not made a personal inquiry into the status of the
case, the order could have remained attached to the records, unserved for a longer period. Ramirez
compounded the problem by issuing a defective writ.
Ramirez and Flordeliza are guilty not only of negligence but also of conduct prejudicial to the
interest of the service. At the very least, they placed the court in a bad light as they presented an
image of a court whose personnel were bumbling and remiss in performing their duties, to the
prejudice of the administration of justice. Court employees bear the burden of observing exacting
standards of ethics and morality. This is the price one pays for the honor of working in the
judiciary. Those who are part of the machinery dispensing justice, from the presiding judge to the
lowliest clerk, must conduct themselves with utmost decorum and propriety to maintain the public’s
faith and respect for the judiciary. However, Ramirez and Flordeliza acted in a way that could cause
an erosion of public trust in the judiciary. As had happened in this case, the non-service of the court
order granting the motion for execution and the delayed issuance of the writ of execution stalled the
execution of the judgment in the civil case. This is a classic case of justice delayed.
Anent the second issue:

YES. the Court finds Sheriff Salvador liable for grave misconduct for his refusal to implement
the writ of execution in the civil case and for interposing obstacles in the enforcement of the writ on
grounds not within the scope of his duty. It is obvious from Salvador’s actuations that he was
interposing obstacles to prevent the speedy enforcement of the alias writ of execution, for reasons
only known to him. The result, of course, was Salvador’s failure to levy on the personal assets of the
defendants who are natural persons.

particularly, it is an unlawful behavior by the public officer. The misconduct is grave if it involves any
of the additional elements of corruption, willful intent to violate the law or to disregard established
rules. In the present case, it has been shown that Salvador willfully violated established rules. By the
nature of their functions, sheriffs must conduct themselves with propriety and decorum, to be above
suspicion. Sheriffs are court officers and, like everyone else in the judiciary, are called upon to
discharge their sworn duties with great care and diligence. They cannot afford to err in serving court
writs and processes and in implementing court orders lest they undermine the integrity of their office
and the efficient administration of justice.
FREDDY H. REYES vs. VIVIAN L. PABILANE

A.M. No. P-09-2696, 12 January 2011, THIRD DIVISION (Carpio Morales, J.)
Failure to reflect in the minutes of the hearings in the civil case the correct documentary
evidence offered in evidence constitutes simple neglect of duty.
Reyes charged Pabilane, Court Interpreter of the MTC with maliciously and deliberately
failing to make an accurate record of the minutes of the proceedings in a civil case filed by Reyes’ wife
before the RTC, where Pabilane was once the court interpreter. Pabilane reportedly fail to indicate
that a witness presented is for Reyes’ wife and to indicate the correct documentary evidence
presented. The Office of the Court Administrator (OCA) concluded that Pabilane is guilty of simple
neglect of duty, and accordingly recommended that she be fined in the amount of P3,000.00.
ISSUE:
Whether or not Pabilane should be held administratively liable for allegedly failing to enter
into the minutes of the hearings the accurate and complete documentary evidence marked.
RULING:
YES. A court interpreter is duty-bound to prepare and sign the minutes of court
sessions which is an important document, for it gives a brief summary of the events that take place
thereat including a statement of the date and time of the session; the name of the judge, clerk of court,
court stenographer, and court interpreter who are present; the names of the counsel for the parties
who appear; the parties presenting evidence; the names of the witnesses who
testified; the documentary evidence marked; and the date of the next hearing.
In the present case, Pabilane failed to reflect in the minutes of the hearings in the civil case
the correct documentary evidence offered in evidence. Such failure constitutes simple neglect of duty,
defined as the failure to give attention to a task expected of him and signifies a disregard of a duty
resulting from carelessness or indifference.
Simple neglect of duty is, under the Revised Uniform Rules on Administrative Cases in the
Civil Service, classified as a less grave offense punishable by one month and one day to six months
suspension for the first offense. The Omnibus Civil Service Rules and Regulations provide that a fine
may be imposed in the alternative.
ANGELITA D. MAYLAS v. JUANCHO M. ESMERIA

A.M. No. P-11-2932, 30 May 2011, THIRD DIVISION (BRION, J.)
The execution of the writ of possession issued by the Court is the judge’s responsibility while the
Sheriff’s duty, is only to implement the writ and this duty is ministerial.
Maylas filed an administrative complaint against Esmeria, Sheriff IV of the RTC in Masbate
City, with grave misconduct, gross ignorance of the law and incompetence. Maylas alleged that the
omission by Esmeria, of executing the court-issued writ of possession by filing a motion to secure the
assistance of a geodetic engineer, without furnishing a copy of the motion to the parties, is
tantamount to gross ignorance of the law and procedure. Moreover, Maylas charged Esmeria of
distorting the facts to unduly favor his friends. Esmeria argued that the issue is judicial in nature; it
was his ministerial duty, as sheriff, to implement the writ.
ISSUE:
Whether or not Esmeria is guilty of gross ignorance of the law.
RULING:
NO. Esmeria had nothing to do with the writ of execution. It was the judge’s responsibility as
the writ was issued by the court. Esmeria’s duty, it must be stressed, is only to implement the writ
and this duty is ministerial. Lastly, vis-a-vis the lack of hearing of the Motion for the Assistance of a
Geodetic Engineer, the same was eventually granted by the trial court. Evidently, if Maylas really
believes that they were deprived of the required procedural due process, she should have impleaded
as respondent either the presiding judge or the branch clerk of court, for these are the court officers
primarily responsible in the setting and granting/denying of a motion. In grumbling against Sheriff
Esmeria about the alleged erroneous issuance of the motion, Maylas had ended up barking on the
wrong tree.
JUDGE EDILBERTO G. ABSIN v. EDGARDO A. MONTALLA
A.M. No. P-10-2829, 21 June 2011, EN BANC (PER CURIAM)
Failure to submit the TSNs within the period prescribed under Administrative Circular No. 24-
90 constitutes gross neglect of duty.
Judge Absin, Presiding Judge of the RTC in Zamboanga del Sur, charged Montalla,
stenographer of the same court, with neglect of duty in failing to submit the required transcripts of
stenographic notes (TSNs) despite repeated reminders from the court. Montalla, however, claimed
that he was prevented from performing his tasks due to poor health as he was diagnosed with
pulmonary tuberculosis, peptic ulcer, and diabetes.
ISSUE:
Whether or not Montalla is guilty of gross neglect of duty classified as a grave offense.
RULING:
YES. The failure to submit the TSNs within the period prescribed under Administrative
Circular No. 24-90 constitutes gross neglect of duty. Gross neglect of duty is classified as a grave
offense and punishable by dismissal even if for the first offense pursuant to the Uniform Rules on
Administrative Cases in the Civil Service. Montalla’s utter disregard of the court directives and the
reminders from his superiors and his lapses in the performance of his duty as a court stenographer
caused delay in the speedy disposition of the case. Montalla repeatedly failed to submit the required
TSNs for several years.
As a stenographer, Montalla should realize that the performance of his duty is essential to the
prompt and proper administration of justice, and his inaction hampers the administration of justice
and erodes public faith in the judiciary. The Court has expressed its dismay over the negligence and
indifference of persons involved in the administration of justice. No less than the Constitution
mandates that public officers must serve the people with utmost respect and responsibility. Public
office is a public trust, and Montalla has without a doubt violated this trust by his failure to fulfill his
duty as a court stenographer. Moreover, this is not the first time that Montalla was charged with
neglect of duty for delay in the submission of the TSNs.
SULTAN PANDAGARANAO A. ILUPA v. MACALINOG S. ABDULLAH

A.M. No. SCC-11-16-P, 1 June 2011, THIRD DIVISION (BRION, J.)
The alleged erroneous entries on the Certificate of Divorce cannot be attributed to the Clerk of
Court considering that it is only his duty to receive, file and register the certificate of divorce presented
to him for registration.
Ilupa charged Clerk of Court Abdullah of the Sharia Circuit Court (ShCC) in Marawi City with
abuse of authority in relation with the issuance of a certificate of divorce. In support of the charge,
Ilupa alleged that Abdullah exhibited ignorance of his duties as clerk of court when he issued a
certificate of divorce relying mainly on an illegal Kapasadan or Agreement. He claims that the
agreement was executed under duress and intimidation; the certificate of divorce itself is defective
and unreliable as there were erroneous entries in the document and unfilled blanks. Abdullah argued
that contrary to the Ilupa’s claim, there was a divorce agreement, in the Maranao dialect, attached to
the divorce certificate.
ISSUE:
Whether or not Clerk of Court Abdullah is guilty of abuse of authority.
RULING:
NO. Evidently, Clerk of Court Abdullah merely performed his ministerial duty in accordance
with the law. The alleged erroneous entries on the Certificate of Divorce cannot be attributed to
Abdullah considering that it is only his duty to receive, file and register the certificate of divorce
presented to him for registration. Further, even if there were indeed erroneous entries on the
certificate of divorce, such errors cannot be corrected nor cancelled through an administrative
complaint.
Aside from Ilupa’s bare allegation, there was no substantial evidence presented to prove the
charge. It is a settled rule in administrative proceedings that the complainant has the burden of
proving the allegations in his or her complaint with substantial evidence. In the absence of evidence
to the contrary, the presumption that the respondent has regularly performed his duties will prevail.
Discipline of Court Personnel
OFFICE OF THE COURT ADMINISTRATOR vs. CLAUDIO M. LOPEZ

A.M. No. P-10-2788, 18 January 2011, EN BANC (PER CURIAM)
In an administrative case, the quantum of proof required is only substantial evidence. The
dismissal of the criminal case is not a ground for the dismissal of the administrative case.
Lopez was charged with a violation of the Dangerous Drugs Act. Meanwhile, the Office of the
Court Administrator (OCA) filed an administrative complaint against Lopez.
An investigating judge was then designated to conduct the investigation on the

administrative matter. During the investigation, Lopez informed the investigating judge that he was
adopting the demurrer to evidence he filed in the criminal case as evidence in this administrative
case. Nevertheless, Lopez wasa found guilty of Grave Misconduct and Conduct Unbecoming a
Government Employee. The OCA agreed.
ISSUE:
Whether or not Lopez should be held administratively liable.
RULING:
YES. The present case is an administrative case, not a criminal case. Therefore, the quantum
of proof required is only substantial evidence, or that amount of relevant evidence which a
reasonable mind might accept as adequate to support a conclusion. The dismissal of the criminal case
against the respondent in an administrative case is not a ground for the dismissal of the
administrative case. Each case is different and must be disposed of according to the facts and the law
applicable to each case.
The evidence showed that Lopez is the occupant of the place where dried marijuana fruiting
tops were recovered. Without the necessary permit from the government to possess the same, such
is a flagrant violation of the law and is considered a grave misconduct. The Court defines misconduct
as a transgression of some established and definite rule of action, more particularly, unlawful
behavior or gross negligence by a public officer. The misconduct is grave if it involves any of the
additional elements of corruption, willful intent to violate the law, or to disregard established rules,
which must be established by substantial evidence. An act need not be tantamount to a crime for it
to be considered as grave misconduct as in fact, crimes involving moral turpitude are treated as a
separate ground for dismissal under the Administrative Code.
Court employees, from the presiding judge to the lowliest clerk, being public servants in an
office dispensing justice, should always act with a high degree of professionalism and responsibility.
Their conduct must not only be characterized by propriety and decorum, but must also be in
accordance with the law and court regulations. Court employees should be models of uprightness,
fairness and honesty to maintain the peoples respect and faith in the judiciary. They should avoid any
act or conduct that would diminish public trust and confidence in the courts. Indeed, those connected
with dispensing justice bear a heavy burden of responsibility.
EXECUTIVE JUDGE LEONILO B. APITA v. MARISSA M. ESTANISLAO

A.M. No. P-06-2206, 16 March 2011, SECOND DIVISION, (Carpio, J.)
Exhorting court personnel to exhibit the highest sense of dedication to their assigned duty
necessarily precludes requiring them to perform any work outside the scope of their assigned job
description, save for duties that are identical with or are subsumed under their present functions.
The court interpreter in Branch 7 of the RTC of Tacloban City, was appointed as Clerk IV
under the CA, leaving the former position in RTC vacant. Judge Apita designated Estanislao, a legal
researcher, to act as Court Interpreter in the said Branch until the vacancy was filled up. However,
Estanislao refused claiming that her designation was a demotion tantamount to removal from the
service without cause; that interpreting during trials was not included in the duties and
responsibilities of her present position; and that she was not defying Judge Apita’s directive, but
merely asserting her right as a civil service employee holding a permanent appointment. In Judge
Apita’s Complaint for insubordination filed in the Office of the Court Administrator (OCA), Judge
Apita requested the OCA to rule whether his directive designating Estanislao as Court Interpreter in
Branch 7 was valid and if so, whether Estanislao may be subjected to administrative sanctions for
insubordination. OCA found Estanislao liable for insubordination.
ISSUE:
Whether or not Estanislao should be held liable for insubordination
RULING:
NO. While the Manual provides that court personnel may perform other duties the presiding
judge may assign from time to time, said additional duties must be directly related to, and must not
significantly vary from, the court personnel’s job description. However, in case of a sudden vacancy
in a court position, the judge may temporarily designate a court personnel with the competence and
skills for the position even if the duties for such position are different from the prescribed duties of
the court personnel. The temporary designation shall last only for such period as is necessary to
designate temporarily a court personnel with the appropriate prescribed duties. Such temporary
designation cannot go on for an indefinite period, or until the vacancy is filled up like in the
designation by Judge Apita to Estanislao in this case. While the executive judge may not require
court personnel to perform work outside the scope of their job description, except duties that are
identical with or are subsumed under their present functions. In this case, since Estanislao’s job
description is that of Legal Researcher, Judge Apita may not designate her to act as Court Interpreter
indefinitely or until the vacancy is filled up. The said designation will require Estanislao to perform
work, which is outside the scope of her job description and which involves duties not identical with
or subsumed under Estanislao’s current functions. To do so would violate the express language of
Section 7, Canon IV of the Code of Conduct for Court Personnel.
JUDGE JEOFFRE W. ACEBIDO v. LUDYCISSA A. HALASAN, JOEL A. LARGO

A. M. No. P-10-2803, 30 March 2011, SECOND DIVISION, (Carpio, J.)
Court employees are enjoined to adhere to the exacting standards of morality and decency in
their professional and private conduct in order to preserve the good name and integrity of the court of
justice
Judge Acebido wrote a letter addressed to the Office of the Court Administrator (OCA),
objecting to the application for promotion of Largo who was applying for the position of Process
Server. Judge Acebido alleged that sometime in October 2008, he learned that Largo had an illicit
relationship with Halasan, who was married and only separated-in-fact. Judge Acebido alleged that
he recommended that Largo and Halasan be detailed to separate courts and his recommendation was
approved by the Executive Judge. Halasan disclosed that her relationship with Largo started
sometime in July 2008. On the other hand, Largo admitted that the relationship lasted for three
months or until he and Halasan were detailed to separate courts. In view of the admissions made by
respondents, the OCA stated that there is no need to require further proof of the relationship. OCA
recommended Halasan and Largo be found guilty of disgraceful and immoral conduct and be both
suspended from the office for six (6) months and one (1) day without pay.
ISSUE:
Whether or not respondents Halasan and Largo are guilty of disgraceful and immoral
conduct.
RULING:
YES. Halasan and Largo are guilty of disgraceful and immoral conduct for which they may be
held administratively liable. Due to their admission of their relationship, there is no need to present
any other evidence to prove the allegations in Judge Acebido’s letter. Under the Civil Service Rules,
immoral conduct is a grave offense punishable with suspension from six months and one day to one
year for the first offense. Considering that this is the first offense on the part of Largo, and that his
relationship with Halasan had already ceased and they were no longer working in the same station,
we deem it proper to impose the penalty of suspension in its minimum period to Largo. As regards
respondent Halasan, the Court is not precluded from tempering justice with mercy, considering the
following circumstances in this case: (1) Halasan has been separated in fact from her husband for
four years when the relationship with Largo happened; (2) She has been an employee of the Court
for 19 years; (3) She solely supports five of her children who lives with her, including three minor
children, one of whom is very sickly; (4) She volunteered to be detailed to another station to stay
away from Largo and to cut the relationship; (5) Largo admitted that he took advantage of Halasan’s
emotional weakness and vulnerability; and (6) This case is the first time that Halasan is being found
administratively liable. Hence, instead of the penalty of suspension, the Court imposes upon
respondent Halasan a fine of P10,000.
EMMANUEL M. GIBAS, JR., v. MA. JESUSA E. GIBAS and FRANCONELLO S. LINTAO

A.M. No. P-09-2651, 23 March 2011, SECOND DIVISION, (Carpio, J.)
Every employee of the judiciary should be an example of integrity, uprightness and honesty. Like
any public servant, he must exhibit the highest sense of honesty and integrity not only in the performance
of his official duties but in his personal and private dealings with other people, to preserve the courts
good name and standing.
This is an administrative complaint for immorality filed by Emmanuel against his wife Jesusa
and Franconello. Jesusa was then Court Stenographer I of the MTC but was detailed at RTC while
Franconello was Sheriff IV of the same RTC. Emmanuel accused his wife, Jesusa of having an illicit
relationship with Franconello. Jesusa filed a Motion to Dismiss, asserting that since she had been
dropped from the rolls and the complaint against her was filed only on September 2007, the Court
no longer had jurisdiction over her person. Records show that Jesusa was dropped from the rolls
effective February 2007 for absence without official leave (AWOL). However, upon verification from
the Office of the Administrative Services, the Office of the Court Administrator (OCA) discovered that
Jesusa was re-employed as Clerk III and assumed office at the RTC, Office of the Clerk of Court, Baguio
City. Further investigation revealed that when Jesusa applied for the new position, she did not
disclose in her personal data sheet that she had a pending administrative charge of immorality and
that she was dropped from the rolls due to AWOL. Upon referral by the Court, the Investigating Judge
found Jesusa and Franconello guilty of immorality. The OCA recommended that Jesusa and
Franconello be dismissed from service.
ISSUE:
Whether or not Jesusa is guilty of immorality
RULING:
YES. OCA’s report finding that Jesusa accomplished her personal data for her re-employment
as Clerk III without disclosing that she had a pending administrative case for immorality resulted to
an administrative charge against Jesusa for falsification of personal data sheet. Such case is still
pending with the Court. On the charge of immorality, Emmanuel was able to substantiate the charge
of immorality against Jesusa and Franconello. The incriminating pictures submitted by complainant
clearly showed the intimate and illicit relationship between Jesusa and Franconello and belied
Jesusa’s claim that they are just friends. Similarly, this is the first offense for Jesusa. Hence, the Court
deems the recommended penalty of dismissal inappropriate. In accordance with the prescribed
penalty in the Uniform Rules on Administrative Cases in the Civil Service, the penalty of six months
and one day is sufficient considering that this is Jesusa’s first offense for immorality.
MARY JANE ABANAG v. NICOLAS B. MATUTE

A.M. No. P-11-2922, 4 April 2011, THIRD DIVISION (Brion, J.)
Mere sexual relations between two unmarried and consenting adults are not enough to warrant
administrative sanction for illicit behavior. The Court has repeatedly held that voluntary intimacy
between a man and a woman who are not married, where both are not under any impediment to marry
and where no deceit exists, is neither a criminal nor an unprincipled act that would warrant disbarment
or disciplinary action.
Abanag is a 23-year old unmarried woman. She alleged that Matute courted her and protested
his undying love for her. Matute promised to marry her, hence they lived together as husband and
wife. When Abanag got pregnant, Matute asked Abanag to abort the baby. When Abanag refused,
Matute started to be cold towards her and eventually abandoned her. She then filed an administrative
case against Matute for disgraceful and immoral conduct. Matute filed a comment vehemently
denying the allegations of Abanag. He contends that the charges against him were baseless, false, and
fabricated. The Executive Judge recommended the dismissal of the complaint against Matute.
ISSUE:
Whether or not the acts of Matute can be considered as disgraceful or grossly immoral.
RULING:
NO. Mere sexual relations between two unmmaried and consenting adults are not enough to
warrant administrative sanction for illicit behavior. The Court has repeatedly held that voluntary
intimacy between a man and a woman who are not married, where both are not under any
impediment to marry and where no deceit exists, is neither a criminal nor an unprincipled act that
would warrant disbarment or disciplinary action.
While the Court has the power to regulate official conduct and, to a certain extent, private
conduct, it is not within our authority to decide on matters touching on employees’ personal lives,
especially those that will affect their and their family’s future. The Court cannot intrude into the
question of whether they should or should not marry. However, the Court took this occasion to
remind judiciary employees to be more circumspect in their adherence to their obligations under the
Code of Professional Responsibility. The conduct of court personnel must be free from any taint of
impropriety or scandal, not only with respect to their official duties but also in their behavior outside
the Court as private individuals. This is the best way to preserve and protect the integrity and the
good name of our courts.
AN ANONYMOUS COMPLAINT AGAINST ATTY. PORTIA DIESTA, BRANCH CLERK OF COURT,

REGIONAL TRIAL COURT, BRANCH 263, PASIG CITY and LUZ SANTOS-TACLA, CLERK III, SAME
COURT
A.M. No. P-05-1970, 30 May 2011, THIRD DIVISION (BRION, J.)
The less grave offenses of simple neglect of duty and of simple misconduct carry the penalty of
suspension for one month and one day to six months for the first offense.
The Office of the Court Administrator (OCA) received an undated anonymous letter complaint
against Atty. Diesta and Santos-Tacla alleging dishonesty, conduct prejudicial to the best interest of
the service, and violation of Republic Act No. 3019 (the Anti-Graft and Corrupt Practices Act). In the
letter, the anonymous writer charged Atty. Diesta of not reporting for work on time, of collecting
commissioners’ fees for ex parte hearings, of not subjecting to raffle the publication of cases and
judicial notices, and of illegally practicing law by appearing in court for his practitioner-father. Tacla,
on the other hand, was charged of being tardy and being frequently absent, of falsifying her entry in
the attendance logbook and on her daily time record, and of acting as runner for Atty. Diesta. The
supporting documents were attached to the letter-complaint. OCA recommends that Atty. Diesta and
Tacla be reprimanded.
ISSUE:
Whether or not Atty. Diesta and Tacla are guilty of simple misconduct.
RULING:
YES. There are admissions and ample evidence to support a finding of culpability on the part
of Atty. Diesta and Tacla. Both are guilty of less grave offenses and, disagreeing with OCA’s
recommendation of reprimand, the Court metes penalties in accordance to the Omnibus Rules
Implementing Book V of Executive Order No. 292. The less grave offenses of simple neglect of duty
and of simple misconduct carry the penalty of suspension for one month and one day to six months
for the first offense. Atty. Diesta is guilty of simple neglect of duty for losing the attendance logbook,
and she is also guilty of simple misconduct for asking for a commissioner’s fee and for failing to have
the publication of official notices raffled. She should be suspended for three months. Tacla, who is
guilty of simple misconduct for not faithfully accomplishing her daily time record, should be
suspended for one month and one day.
JOHN A. MENDEZ, ANGELITO CABALLERO and IVY CABALLERO v. NERISSA A. BALBUENA

The Code of Judicial Ethics mandates that court personnel must not only be, but also be
perceived to be, free from any impropriety with respect to both their official duties and their behavior
anywhere else.
Balbuena, a court interpreter, demanded an apology from Mendez since two of Balbuena’s
boarders were almost sideswiped by the motorcycle of Mendez’s co-workers. Mendez’s co-workers
did what Balbuena demanded and apologized to one of the boarders. Not content with the apology
given by Mendez’ co-workers, Balbuena turned her ire on Mendez, so Mendez decided to stay away
from Balbuena. Mendez reported to the police officers that Balbuena barged into his place, ransacked
his room, and threw all his clothes out into the street. In addition, Balbuena told Mendez to
immediately leave the premises, threatening that she would secure police assistance to bodily carry
him from his rented room to the street.
ISSUE:
Whether or not Balbuena is guilty of oppression and of conduct unbecoming a court employee
acts that amount to simple misconduct.
RULING:
YES. The Code of Judicial Ethics mandates that court personnel must not only be, but also be
perceived to be, free from any impropriety with respect to both their official duties and their behavior
anywhere else. Employees of the judiciary should be very circumspect in how they conduct
themselves inside and outside the office, particularly when they use agents of the law in their actions.
By Balbuena’s actions, she directly implied that she was using her court position to unilaterally
enforce what she wanted which is to harass Mendez. By so doing, she brought the image of the
judiciary to disrepute, as this is not the way of the law and of those who enforce the law. It matters
not that her acts were not work-related. Employees of the judiciary should be living examples of
uprightness, not only in the performance of official duties, but also in their personal and private
dealings with other people, so as to preserve at all times the good name and standing of the courts in
the community. Any scandalous behavior or any act that may erode the peoples esteem for the
judiciary is unbecoming of an employee. Professionalism, respect for the rights of others, good
manners and right conduct are expected of all judicial officers and employees. At all times, court
employees should avoid situations which tend to arouse suspicions that they are utilizing their
official position for personal gain or advantage, to the prejudice of the public.
LINA LAURIA-LIBERATO VS. NESTOR M. LELINA

A.M. No. P-09-2703, 5 September 2011, THIRD DIVISION (Peralta, J.)
Employees of the Judiciary serve as sentinels of justice and any act of impropriety on their part
immeasurably affects the honor and dignity of the Judiciary and the people's confidence in it. No other
office in the government service exacts a greater demand for moral righteousness and uprightness from
an employee than in the Judiciary. This exacting standard applies not only to the court employee's norm
of conduct pertaining to the discharge of his official duties, but also to his personal dealings, which must
be within the parameters of morality, propriety, and decency.
Lauria-Liberato’s late grandfather was the owner of a parcel of land. Her grandfather allowed
Lelina to occupy a portion of the property, provided Lelina would pay rent. Lelina never paid rent.
Subsequently, Lauria-Liberato found out that the title of the land is no longer under her grandfather’s
name but is already under Lelina’s name, based on an Affidavit of Relinquishment purportedly
executed by Lauria-Liberato’s grandfather in favor of Lelina. Lauria-Liberato refuted Lelina’s claim
of the genuineness of the Affidavit because his father has already died at the date of the supposed
execution of the Affidavit. A criminal complaint for Estafa through Falsification of Public Documents
was filed against Lelina, to which Lelina was found guilty.
An administrative complaint was likewise filed by Lauria-Liberato against Lelina for grave
misconduct, dishonesty, and conduct prejudicial to the best interest of the service, but this was
deferred pending resolution of the criminal case. After the final conviction in the criminal case, the
Office of the Court Administrator (OCA) recommended that Lelina be found guilty of dishonesty and,
accordingly, be dismissed from the service. The OCA found Lelina’s dishonest conduct to be gravely
injurious to the noble and untarnished image of the court.
ISSUE:
Whether or not Lelina should be held administratively liable for dishonesty committed
outside the performance of his duties as Clerk of Court.
RULING:
YES. The Code of Conduct for Court Personnel stresses that employees of the Judiciary serve
as sentinels of justice and any act of impropriety on their part immeasurably affects the honor and
dignity of the Judiciary and the people's confidence in it. No other office in the government service
exacts a greater demand for moral righteousness and uprightness from an employee than in the
Judiciary. Clerks of Court, in particular, are the chief administrative officers of their respective courts.
They must show competence, honesty and probity, having been charged with safeguarding the
integrity of the court and its proceedings. This exacting standard applies not only to the court
employee's norm of conduct pertaining to the discharge of his official duties, but also to his personal
dealings, which must be within the parameters of morality, propriety, and decency.
As Clerk of Court, his act of executing an Affidavit of Relinquishment which stated that a dead
person personally appeared before the Bureau of Lands and relinquished his rights was a willful
perversion of the truth that greatly prejudiced the rights and interests of the heirs of the deceased. To
compound the defraudation, Lelina presented the said affidavit in support of his application for free
patent over the subject parcel of land that eventually led to the issuance titles under his
name. Although the execution of the document was done in his personal capacity, and not in any way
related to his duties as Clerk of Court II, being a court personnel, the act of defraudation he
perpetrated, which caused damage and prejudice of the heirs of the deceased, amounted to grave
misconduct and clearly degraded the integrity of the Judiciary as a respectable
institution. Misconduct is defined as a transgression of some established and definite rule of action,
more particularly, unlawful behavior or gross negligence by a public officer; and the misconduct is
grave if it involves any of the additional elements of corruption, such as willful intent to violate the
law or to disregard established rules, which must be established by substantial evidence. His
reprehensible act should be sanctioned, and he should be purged from the Judiciary.
FALSIFICATION OF DAILY TIME RECORDS OF MA. EMCISA A. BENEDICTOS

A.M. No. P-10-2784 (Formerly A.M. No. 05-3-138-RTC), 19 October 2011, FIRST DIVISION,
(LEONARDO-DE CASTRO, J.)
Dishonesty, being in the nature of a grave offense, carries the extreme penalty of dismissal from
the service with forfeiture of retirement benefits except accrued leave credits, and perpetual
disqualification for reemployment in government service.
The Office of the Court Administrator (OCA) requested Executive Judge Agloro of the RTC
Malolos City, Bulacan, to instruct Benedictos to submit her DTRs/bundy cards for September and
October 2004 within five days, otherwise, the OCA would recommend the withholding of Benedictos’
salaries. Benedictos submitted her bundy cards for August, October, and November 2004, which the
OCA referred to Atty. Emmanuel L. Ortega (Atty. Ortega), Clerk of Court, for verification of his
signatures appearing thereon. Atty. Ortega reported that only his signature on Benedictos’ bundy
card for November 2004 was true and genuine; and he disowned his purported signatures on
Benedictos’ bundy cards for August and October 2004. On three separate occasions, the OCA required
Benedictos to file her comment, however, Benedictos failed to comply to all. Finally, the Court deemed
Benedictos to have waived her right to file a comment on Atty. Ortegas letter.
ISSUE:
Whether or not the Courts erred in convicting the accused of falsification her daily time
records despite her silence.
RULING:
NO. Refusal to face the charges against her head-on is contrary to the principle in criminal
law that the first impulse of an innocent person, when accused of wrongdoing, is to express his or her
innocence at the first opportune time. Moreover, as a result of its own analytical study of the evidence
on record, the Court is convinced that Atty. Ortega’s signatures appearing on Benedictos’ bundy cards
for August and October 2004 were indeed forged. The marked differences between Atty. Ortega’s
purported signatures on the two bundy cards and Atty. Ortegas admitted genuine signatures are
easily discernible even to the naked eye.
Benedictos’ falsification of her bundy cards is tantamount to dishonesty. Dishonesty is

defined as the disposition to lie, cheat, deceive, or defraud; untrustworthiness; lack of integrity; lack
of honesty, probity or integrity in principle; lack of fairness and straightforwardness; disposition to
defraud, deceive or betray. Dishonesty, being in the nature of a grave offense, carries the extreme
penalty of dismissal from the service with forfeiture of retirement benefits except accrued leave
credits, and perpetual disqualification for reemployment in government service.

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