jurisdiction -- rem

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G.R. No. 131282 January 4, 2002 GABRIEL L. DUERO, petitioner, vs. HON.COURT OF APPEALS, and BERNARDO A. ERADEL, respondents. QUISUMBING, J.: This petition for certiorari assails the Decisionl dated September 17, 1997, of the Court of Appeals in CA-G.R. No. SP No.. 2340- UDK, entitled Bernardo Eradel vs. Non. Ermelino G. Andal, setting aside all proceedings in Civil Case No.1075, Gabriel L. Duero vs. Bernardo Eradel, before the Branch 27 of the Regional Trial Court of Tandag, Surigao del Sur . The pertinent facts are as follow. Sometime in 1988, according to petitioner, private respondent Bemardo Eradel 2 entered and occupied petitioner's land covered by Tax Declaration No. A-16-13-302, located in Baras, San Miguel, Surigao del Sur. As shown in the tax declaration, the land had an assessed value of P5,240. When petitioner politely informed private respondent that the land was his and requested the latter to vacate the land, private respondent refused, but instead threatened him with bodily harm. Despite repeated demands, private respondent remained steadfast in his refusal to leave the land. On June 16, 1995, petitioner filed before the RTC a complaint for Recovery of Possession and Ownership with Damages and Attorney's Fees against private respondent and two others, namely, Apolinario and Inocencio Ruena. Petitioner appended to the complaint the aforementioned tax declaration. The counsel of the Ruenas asked for extension to file their Answer and was given until July 18, 1995. Meanwhile, petitioner and the, Ruenas executed a compromise agreement, which became the trial court's basis for a partial judgment rendered on January 12, 1996. In this agreement, the Ruenas through their counsel, Atty. Eusebio Avila, entered into a Compromise Agreement with herein petitioner, Gabriel Duero. Inter alia, the agreement stated that the Ruenas recognized and bound themselves to respect the ownership and possession of Duero. 3 Herein private respondent Eradel was not a party to the agreement, and he was declared in default for failure to file his answer to the complaint. 4 Petitioner presented his evidence ex parte on February 13, 1996. On May 8, 1996, judgment was rendered in his favor, and private respondent was ordered to peacefully vacate and turn over Lot No.1065 Cad. 537-D to petitioner; pay petitioner P2,000 annual rental from 1988 up the time he vacates the land, and P5,000 as attorney's fees and the cost of the suit. 5 Private respondent received a copy of the decision on May 25, 1996. On June 10, 1996, private respondent filed a Motion for New Trial, alleging that he has been occupying the land as a tenant of Artemio Laurente, Sr., since 1958. He explained that he turned over the complaint and summons to Laurente in the honest belief that as landlord, the latter had a better right to the land and was responsible to defend any adverse claim on it. However, the trial court denied the motion for new trial.1âwphi1.nêt Meanwhile, RED Conflict Case No.1029, an administrative case between petitioner and applicant-contestants Romeo, Artemio and Jury Laurente, remained pending with the Office of the Regional Director of the Department of Environment and Natural Resources in Davao City. Eventually, it was forwarded to the DENR Regional Office in Prosperidad, Agusan del Sur . On July 24, 1996, private respondent filed before the RTC a Petition for Relief from Judgment, reiterating the same allegation in his Motion for New Trial. He averred that unless there is a determination on who owned the land, he could not be made to vacate the land. He also averred that the judgment of the trial court was void inasmuch as the heirs of Artemio Laurente, Sr., who are indispensable parties, were not impleaded. On September 24, 1996, Josephine, Ana Soledad and Virginia, all surnamed Laurente, grandchildren of Artemio who were claiming ownership of the land, filed a Motion for Intervention. The RTC denied the motion. On October 8, 1996, the trial court issued an order denying the Petition for Relief from Judgment. In a Motion for Reconsideration of said order, private respondent alleged that the RTC had no jurisdiction over the case, since the value of the land was only P5,240 and therefore it was under the jurisdiction of the municipal trial court. On November 22, 1996, the RTC denied the motion for reconsideration. On January 22, 1997, petitioner filed a Motion for Execution, which the RTC granted on January 28. On February 18, 1997, Entry of Judgment was made of record and a writ of execution was issued by the RTC on February 27,1997. On March 12,1997, private respondent filed his petition for certiorari before the Court of Appeals. The Court of Appeals gave due course to the petition, maintaining that private respondent is not estopped from assailing the jurisdiction 'of the RTC, Branch 27 in Tandag, Surigao del Sur, when private respondent filed with said court

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Page 1: Jurisdiction -- Rem

G.R. No. 131282           January 4, 2002

GABRIEL L. DUERO, petitioner, vs.HON.COURT OF APPEALS, and BERNARDO A. ERADEL, respondents.

QUISUMBING, J.:

This petition for certiorari assails the Decisionl dated September 17, 1997, of the Court of Appeals in CA-G.R. No. SP No.. 2340- UDK, entitled Bernardo Eradel vs. Non. Ermelino G. Andal, setting aside all proceedings in Civil Case No.1075, Gabriel L. Duero vs. Bernardo Eradel, before the Branch 27 of the Regional Trial Court of Tandag, Surigao del Sur .

The pertinent facts are as follow.

Sometime in 1988, according to petitioner, private respondent Bemardo Eradel2 entered and occupied petitioner's land covered by Tax Declaration No. A-16-13-302, located in Baras, San Miguel, Surigao del Sur. As shown in the tax declaration, the land had an assessed value of P5,240. When petitioner politely informed private respondent that the land was his and requested the latter to vacate the land, private respondent refused, but instead threatened him with bodily harm. Despite repeated demands, private respondent remained steadfast in his refusal to leave the land.

On June 16, 1995, petitioner filed before the RTC a complaint for Recovery of Possession and Ownership with Damages and Attorney's Fees against private respondent and two others, namely, Apolinario and Inocencio Ruena. Petitioner appended to the complaint the aforementioned tax declaration. The counsel of the Ruenas asked for extension to file their Answer and was given until July 18, 1995. Meanwhile, petitioner and the, Ruenas executed a compromise agreement, which became the trial court's basis for a partial judgment rendered on January 12, 1996. In this agreement, the Ruenas through their counsel, Atty. Eusebio Avila, entered into a Compromise Agreement with herein petitioner, Gabriel Duero. Inter alia, the agreement stated that the Ruenas recognized and bound themselves to respect the ownership and possession of Duero.3 Herein private respondent Eradel was not a party to the agreement, and he was declared in default for failure to file his answer to the complaint.4

Petitioner presented his evidence ex parte on February 13, 1996. On May 8, 1996, judgment was rendered in his favor, and private respondent was ordered to peacefully vacate and turn over Lot

No.1065 Cad. 537-D to petitioner; pay petitioner P2,000 annual rental from 1988 up the time he vacates the land, and P5,000 as attorney's fees and the cost of the suit.5 Private respondent received a copy of the decision on May 25, 1996.

On June 10, 1996, private respondent filed a Motion for New Trial, alleging that he has been occupying the land as a tenant of Artemio Laurente, Sr., since 1958. He explained that he turned over the complaint and summons to Laurente in the honest belief that as landlord, the latter had a better right to the land and was responsible to defend any adverse claim on it. However, the trial court denied the motion for new trial.1âwphi1.nêt

Meanwhile, RED Conflict Case No.1029, an administrative case between petitioner and applicant-contestants Romeo, Artemio and Jury Laurente, remained pending with the Office of the Regional Director of the Department of Environment and Natural Resources in Davao City. Eventually, it was forwarded to the DENR Regional Office in Prosperidad, Agusan del Sur .

On July 24, 1996, private respondent filed before the RTC a Petition for Relief from Judgment, reiterating the same allegation in his Motion for New Trial. He averred that unless there is a determination on who owned the land, he could not be made to vacate the land. He also averred that the judgment of the trial court was void inasmuch as the heirs of Artemio Laurente, Sr., who are indispensable parties, were not impleaded.

On September 24, 1996, Josephine, Ana Soledad and Virginia, all surnamed Laurente, grandchildren of Artemio who were claiming ownership of the land, filed a Motion for Intervention. The RTC denied the motion.

On October 8, 1996, the trial court issued an order denying the Petition for Relief from Judgment. In a Motion for Reconsideration of said order, private respondent alleged that the RTC had no jurisdiction over the case, since the value of the land was only P5,240 and therefore it was under the jurisdiction of the municipal trial court. On November 22, 1996, the RTC denied the motion for reconsideration.

On January 22, 1997, petitioner filed a Motion for Execution, which the RTC granted on January 28. On February 18, 1997, Entry of Judgment was made of record and a writ of execution was issued by the RTC on February 27,1997. On March 12,1997, private respondent filed his petition for certiorari before the Court of Appeals.

The Court of Appeals gave due course to the petition, maintaining that private respondent is not estopped from assailing the jurisdiction 'of the RTC, Branch 27 in Tandag, Surigao del Sur, when private respondent filed with said court his Motion for Reconsideration And/Or Annulment of Judgment. The Court of Appeals decreed as follows:

IN THE LIGHT OF ALL THE FOREGOING, the Petition is GRANTED. All proceedings in "Gabriel L. Duero vs. Bernardo Eradel, et. al. Civil Case 1075" filed in the Court a quo, including its Decision, Annex "E" of the petition, and its Orders and Writ of Execution and the turn over of the property to the Private Respondent by the Sheriff of the Court a quo, are declared null and void and hereby SET ASIDE, No pronouncement as to costs.

SO ORDERED.6

Petitioner now comes before this Court, alleging that the Court of Appeals acted with grave abuse of discretion amounting to lack or in excess of jurisdiction when it held that:

I.

...THE LOWER COURT HAS NO JURISDICTION OVER THE SUBJECT MA TTER OF THE CASE.

II

...PRIVATE RESPONDENT WAS NOT THEREBY ESTOPPED FROM QUESTIONING THE JURISDICTION OF THE LOWER COURT EVEN AFTER IT SUCCESSFULLY SOUGHT AFFIRMATIVE RELIEF THEREFROM.

III

...THE FAlLURE OF PRIVATE RESPONDENT TO FILE HIS ANSWER IS JUSTIFIED. 7

The main issue before us is whether the Court of Appeals gravely abused its discretion when it held that the municipal trial court had jurisdiction, and that private respondent was not estopped from assailing the jurisdiction of the RTC after he had filed several motions before it. The secondary issue is whether the Court of appeals erred in holding that private respondent's failure to file an answer to the complaint was justified.

Page 2: Jurisdiction -- Rem

At the outset, however, we note that petitioner through counsel submitted to this Court pleadings that contain inaccurate statements. Thus, on page 5 of his petition,8 we find that to bolster the claim that the appellate court erred in holding that the RTC had no jurisdiction, petitioner pointed to Annex E9 of his petition which supposedly is the Certification issued by the Municipal Treasurer of San Miguel, Surigao, specifically containing the notation, "Note: Subject for General Revision Effective 1994." But it appears that Annex E of his petition is not a Certification but a xerox copy of a Declaration of Real Property. Nowhere does the document contain a notation, "Note: Subject for General Revision Effective 1994." Petitioner also asked this Court to refer to Annex F,10 where he said the zonal value of the disputed land was P1.40 per sq.m., thus placing the computed value of the land at the time the complaint was filed before the RTC at P57,113.98, hence beyond the jurisdiction of the municipal court and within the jurisdiction of the regional trial court. However, we find that these annexes are both merely xerox copies. They are obviously without evidentiary weight or value.

Coming now to the principal issue, petitioner contends that respondent appellate court acted with grave abuse of discretion. By "grave abuse of discretion" is meant such capricious and whimsical exercise of judgment which is equivalent to an excess or a lack of jurisdiction. The abuse of discretion must be 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, 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 or hostility.11 But here we find that in its decision holding that the municipal court has jurisdiction over the case and that private respondent was not estopped from questioning the jurisdiction of the RTC, respondent Court of Appeals discussed the facts on which its decision is grounded as well as the law and jurisprudence on the matter.12 Its action was neither whimsical nor capricious.

Was private respondent estopped from questioning the jurisdiction of the RTC? In this case, we are in agreement with the Court of Appeals that he was not. While participation in all stages of a case before the trial court, including invocation of its authority in asking for affirmative relief, effectively bars a party by estoppel from challenging the court's jurisdiction,13 we note that estoppel has become an equitable defense that is both substantive and remedial and its successful invocation can bar a right and not merely its equitable enforcement.14Hence, estoppel ought to be applied with caution. For estoppel to apply, the action giving rise thereto must be unequivocal and intentional because, if misapplied, estoppel may become a tool of injustice.15

In the present case, private respondent questions the jurisdiction of RTC in Tandag, Surigao del Sur, on legal grounds. Recall that it was petitioner who filed the complaint against private respondent and two other parties before the said court,16 believing that the RTC had jurisdiction over his complaint. But by then, Republic Act 769117 amending BP 129 had become effective, such that jurisdiction already belongs not to the RTC but to the MTC pursuant to said amendment. Private respondent, an unschooled farmer, in the mistaken belief that since he was merely a tenant of the late Artemio Laurente Sr., his landlord, gave the summons to a Hipolito Laurente, one of the surviving heirs of Artemio Sr., who did not do anything about the summons. For failure to answer the complaint, private respondent was declared in default. He then filed a Motion for New Trial in the same court and explained that he defaulted because of his belief that the suit ought to be answered by his landlord. In that motion he stated that he had by then the evidence to prove that he had a better right than petitioner over the land because of his long, continuous and uninterrupted possession as bona-fide tenant-lessee of the land.18But his motion was denied. He tried an alternative recourse. He filed before the RTC a Motion for Relief from Judgment. Again, the same court denied his motion, hence he moved for reconsideration of the denial. In his Motion for Reconsideration, he raised for the first time the RTC's lack of jurisdiction. This motion was again denied. Note that private respondent raised the issue of lack of jurisdiction, not when the case was already on appeal, but when the case, was still before the RTC that ruled him in default, denied his motion for new trial as well as for relief from judgment, and denied likewise his two motions for reconsideration. After the RTC still refused to reconsider the denial of private respondent's motion for relief from judgment, it went on to issue the order for entry of judgment and a writ of execution.

Under these circumstances, we could not fault the Court of Appeals in overruling the RTC and in holding that private respondent was not estopped from questioning the jurisdiction of the regional trial court. The fundamental rule is that, the lack of jurisdiction of the court over an action cannot be waived by the parties, or even cured by their silence, acquiescence or even by their express consent.19 Further, a party may assail the jurisdiction of the court over the action at any stage of the proceedings and even on appeal.20 The appellate court did not err in saying that the RTC should have declared itself barren of jurisdiction over the action. Even if private respondent actively participated in the proceedings before said court, the doctrine of estoppel cannot still be properly invoked against him because the question of lack of jurisdiction may be raised at anytime and at any stage of the action.21Precedents tell us that as a general rule, the jurisdiction of a court is not a question of acquiescence as a matter of fact, but an issue of conferment as a matter of law.22 Also, neither waiver

nor estoppel shall apply to confer jurisdiction upon a court, barring highly meritorious and exceptional circumstances.23 The Court of Appeals found support for its ruling in our decision in Javier vs. Court of Appeals, thus:

x x x The point simply is that when a party commits error in filing his suit or proceeding in a court that lacks jurisdiction to take cognizance of the same, such act may not at once be deemed sufficient basis of estoppel. It could have been the result of an honest mistake, or of divergent interpretations of doubtful legal provisions. If any fault is to be imputed to a party taking such course of action, part of the blame should be placed on the court which shall entertain the suit, thereby lulling the parties into believing that they pursued their remedies in the correct forum. Under the rules, it is the duty of the court to dismiss an action 'whenever it appears that the court has no jurisdiction over the subject matter.' (Sec. 2, Rule 9, Rules of Court) Should the Court render a judgment without jurisdiction, such judgment may be impeached or annulled for lack of jurisdiction (Sec. 30, Rule 132, Ibid), within ten (10) years from the finality of the same. [Emphasis ours.]24

Indeed, "...the trial court was duty-bound to take judicial notice of the parameters of its jurisdiction and its failure to do so, makes its decision a 'lawless' thing."25

Since a decision of a court without jurisdiction is null and void, it could logically never become final and executory, hence appeal therefrom by writ of error would be out of the question. Resort by private respondent to a petition for certiorari before the Court of Appeals was in order .

In holding that estoppel did not prevent private respondent from questioning the RTC's jurisdiction, the appellate court reiterated the doctrine that estoppel must be applied only in exceptional cases, as its misapplication could result in a miscarriage of justice. Here, we find that petitioner, who claims ownership of a parcel of land, filed his complaint before a court without appropriate jurisdiction. Defendant, a farmer whose tenancy status is still pending before the proper administrative agency concerned, could have moved for dismissal of the case on jurisdictional grounds. But the farmer as defendant therein could not be expected to know the nuances of jurisdiction and related issues. This farmer, who is now the private respondent, ought not to be penalized when he claims that he made an honest mistake when he initially submitted his motions before the RTC, before he realized that the controversy was outside the RTC's cognizance but within the jurisdiction of the municipal trial court. To hold him in estoppel as

Page 3: Jurisdiction -- Rem

the RTC did would amount to foreclosing his avenue to obtain a proper resolution of his case. Furthermore, if the RTC's order were to be sustained, he would be evicted from the land prematurely, while RED Conflict Case No.1029 would remain unresolved. Such eviction on a technicality if allowed could result in an injustice, if it is later found that he has a legal right to till the land he now occupies as tenant-lessee.1âwphi1.nêt

Having determined that there was no grave abuse of discretion by the appellate court in ruling that private respondent was not estopped from questioning the jurisdiction of the RTC, we need not tarry to consider in detail the second issue. Suffice it to say that, given the circumstances in this case, no error was committed on this score by respondent appellate court. Since the RTC had no jurisdiction over the case, private respondent had justifiable reason in law not to file an answer, aside from the fact that he believed the suit was properly his landlord's concern.

WHEREFORE, the petition is DISMISSED. The assailed decision of the Court of Appeals is AFFIRMED. The decision of the Regional Trial Court in Civil Case No.1075 entitled Gabriel L. Duero vs. Bernardo Eradel, its Order that private respondent turn over the disputed land to petitioner, and the Writ of Execution it issued, areANNULLED and SET ASIDE. Costs against petitioner .

SO ORDERED.

Bellosillo, Mendoza, De Leon, Jr., JJ., concur. Buena, J., on official leave.

Page 4: Jurisdiction -- Rem

[G.R. No. 129638.  December 8, 2003]

ANTONIO T. DONATO, petitioner, vs. COURT OF APPEALS, FILOMENO ARCEPE, TIMOTEO BARCELONA, IGNACIO BENDOL, THELMA P. BULICANO, ROSALINDA CAPARAS, ROSITA DE COSTO, FELIZA DE GUZMAN, LETICIA DE LOS REYES, ROGELIO GADDI, PAULINO GAJARDO, GERONIMO IMPERIAL, HOMER IMPERIAL, ELVIRA LESLIE, CEFERINO LUGANA, HECTOR PIMENTEL, NIMFA PIMENTEL, AURELIO G. ROCERO, ILUMINADA TARA, JUANITO VALLESPIN, AND NARCISO YABUT, respondents.

D E C I S I O N

AUSTRIA-MARTINEZ, J.:

Before us is a “petition for review on certiorari” filed on July 17, 1997 which should be a petition for certiorari under Rule 65 of the Rules of Court.  It assails the Resolutions[1] datedMarch 21, 1997 and June 23, 1997 issued by the Court of Appeals in CA-G.R. SP No. 41394.[2]

The factual background of the case is as follows:

Petitioner Antonio T. Donato is the registered owner of a real property located at Ciriaco Tuason Street, San Andres, Manila, covered by Transfer Certificate of Title No. 131793 issued by the Register of Deeds of the City of Manila on November 24, 1978.  On June 7, 1994, petitioner filed a complaint before the Metropolitan Trial Court (Branch 26) of Manila (MeTC) for forcible entry and unlawful detainer against 43 named defendants and “all unknown occupants” of the subject property.[3]

Petitioner alleges that: private respondents had oral contracts of lease that expired at the end of each month but were impliedly renewed under the same terms by mere acquiescence or tolerance; sometime in 1992, they stopped paying rent; on April 7, 1994, petitioner sent them a written demand to vacate; the non-compliance with said demand letter constrained him to file the ejectment case against them.[4]

Of the 43 named defendants, only 20 (private respondents,[5] for brevity) filed a consolidated Answer dated June 29, 1994 wherein they denied non-payment of rentals.  They contend that they cannot be evicted because the Urban Land Reform Law guarantees security of tenure and priority right to purchase the subject property; and that there was a negotiation for the purchase of the lots occupied by them but when the negotiation reached a passive stage, they decided to continue payment of rentals and tendered payment to petitioner’s counsel and thereafter initiated a petition for consignation of the rentals in Civil

Case No. 144049 while they await the outcome of the negotiation to purchase.

Following trial under the Rule on Summary Procedure, the MeTC rendered judgment on September 19, 1994 against the 23 non-answering defendants, ordering them to vacate the premises occupied by each of them, and to pay jointly and severally P10,000.00 per month from the date they last paid their rent until the date they actually vacate, plus interest thereon at the legal rate allowed by law, as well as P10,000.00 as attorney’s fees and the costs of the suit.  As to the 20 private respondents, the MeTC issued a separate judgment[6] on the same day sustaining their rights under the Land Reform Law, declaring petitioner’s cause of action as not duly warranted by the facts and circumstances of the case and dismissing the case without prejudice.

Not satisfied with the judgment dismissing the complaint as against the private respondents, petitioner appealed to the Regional Trial Court (Branch 47) of Manila (RTC).[7] In a Decision[8] dated July 5, 1996, the RTC sustained the decision of the MeTC.

Undaunted, petitioner filed a petition for review with the Court of Appeals (CA for brevity), docketed as CA-G.R. SP No. 41394.  In a Resolution dated March 21, 1997, the CA dismissed the petition on two grounds: (a) the certification of non-forum shopping was signed by petitioner’s counsel and not by petitioner himself, in violation of Revised Circular No. 28-91;[9] and, (b) the only annex to the petition is a certified copy of the questioned decision but copies of the pleadings and other material portions of the record as would support the allegations of the petition are not annexed, contrary to Section 3, paragraph b, Rule 6 of the Revised Internal Rules of the Court of Appeals (RIRCA).[10]

On April 17, 1997, petitioner filed a Motion for Reconsideration,[11] attaching thereto a photocopy of the certification of non-forum shopping duly signed by petitioner himself[12] and the relevant records of the MeTC and the RTC.[13] Five days later, or on April 22, 1997, petitioner filed a Supplement[14] to his motion for reconsideration submitting the duly authenticated original of the certification of non-forum shopping signed by petitioner.[15]

In a Resolution[16] dated June 23, 1997 the CA denied petitioner’s motion for reconsideration and its supplement, ruling that “petitioner’s subsequent compliance did not cure the defect in the instant petition.”[17]

Hence, the present petition anchored on the following grounds:

I.

RESPONDENT COURT OF APPEALS GRAVELY ERRED IN DISMISSING THE PETITION BASED ON HYPER-TECHNICAL GROUNDS BECAUSE:

A.     PETITIONER HAS SUBSTANTIALLY COMPLIED WITH SUPREME COURT CIRCULAR NO. 28-91. MORE, PETITIONER SUBSEQUENTLY SUBMITTED DURING THE PENDENCY OF THE PROCEEDINGS A DULY AUTHENTICATED CERTIFICATE OF NON-FORUM SHOPPING WHICH HE HIMSELF SIGNED AND EXECUTED IN THE UNITED STATES.

B.     PETITIONER HAS SUBSTANTIALLY COMPLIED WITH SECTION 3, RULE 6 OF THE REVISED INTERNAL RULES OF THE COURT OF APPEALS.  MORE, PETITIONER SUBSEQUENTLY SUBMITTED DURING THE PENDENCY OF THE PROCEEDINGS COPIES OF THE RELEVANT DOCUMENTS IN THE CASES BELOW.

C.     PETITIONER HAS A MERITORIOUS APPEAL, AND HE STANDS TO LOSE SUBSTANTIAL PROPERTY IF THE APPEAL IS NOT GIVEN DUE COURSE.  THE RULES OF PROCEDURE MUST BE LIBERALLY CONSTRUED TO DO SUBSTANTIAL JUSTICE.

II.

RESPONDENT COURT OF APPEALS GRAVELY ERRED IN NOT RULING THAT ALL THE ELEMENTS OF UNLAWFUL DETAINER ARE PRESENT IN THE CASE AT BAR.

III.

RESPONDENT COURT OF APPEALS ERRED IN NOT RULING THAT THE RTC MANILA, BRANCH 47, COMMITTED REVERSIBLE ERROR IN AFFIRMING THE FINDING OF MTC MANILA, BRANCH 26, THAT PRIVATE RESPONDENTS CANNOT BE EJECTED FROM THE SUBJECT PROPERTY WITHOUT VIOLATING THEIR SECURITY OF TENURE EVEN IF THE TERM OF THE LEASE IS MONTH-TO-MONTH WHICH EXPIRES AT THE END OF EACH MONTH.  IN THIS REGARD,

A.     RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE

Page 5: Jurisdiction -- Rem

RTC MANILA COMMITTED REVERSIBLE ERROR IN NOT RULING THAT TENANTS UNDER P.D. 1517 MAY BE EVICTED FOR NON-PAYMENT OF RENT, TERMINATION OF LEASE OR OTHER GROUNDS FOR EJECTMENT.

B.      RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN NOT RULING THAT THE ALLEGED “PRIORITY RIGHT TO BUY THE LOT THEY OCCUPY” DOES NOT APPLY WHERE THE LANDOWNER DOES NOT INTEND TO SELL THE SUBJECT PROPERTY, AS IN THE CASE AT BAR.

C.     RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN RULING THAT THE SUBJECT PROPERTY IS LOCATED WITHIN A ZONAL IMPROVEMENT AREA OR APD.

D.     RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN NOT RULING THAT PRIVATE RESPONDENTS’ NON-COMPLIANCE WITH THE CONDITIONS UNDER THE LAW RESULT IN THE WAIVER OF PROTECTION AGAINST EVICTION.

E.      RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN NOT RULING THAT PRIVATE RESPONDENTS CANNOT BE ENTITLED TO PROTECTION UNDER P.D. 2016 SINCE THE GOVERNMENT HAS NO INTENTION OF ACQUIRING THE SUBJECT PROPERTY.

F.      RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN FINDING THAT THERE IS AN ON-GOING NEGOTIATION FOR THE SALE OF THE SUBJECT PROPERTY AND THAT IT RENDERS THE EVICTION OF PRIVATE RESPONDENTS PREMATURE.

G.     RESPONDENT COURT OF APPEALS SHOULD HAVE RULED THAT THE RTC MANILA COMMITTED REVERSIBLE ERROR IN NOT RULING THAT THE ALLEGED CASE FOR CONSIGNATION DOES NOT BAR THE EVICTION OF PRIVATE RESPONDENTS.

IV.

RESPONDENT COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT RESPONDENTS SHOULD PAY PETITIONER A REASONABLE COMPENSATION FOR THEIR USE AND OCCUPANCY OF THE SUBJECT PROPERTY IN THE AMOUNT OF AT LEAST P10,000.00 PER MONTH FROM THE DATE THEY LAST PAID RENT UNTIL THE TIME THEY ACTUALLY VACATE THE SAME, WITH LEGAL INTEREST AT THE MAXIMUM RATE ALLOWED BY LAW UNTIL PAID.

V.

RESPONDENT COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT RESPONDENTS SHOULD PAY PETITIONER ATTORNEY’S FEES AND EXPENSES OF LITIGATION OF AT LEAST P20,000.00, PLUS COSTS.[18]

Petitioner submits that a relaxation of the rigid rules of technical procedure is called for in view of the attendant circumstances showing that the objectives of the rule on certification of non-forum shopping and the rule requiring material portions of the record be attached to the petition have not been glaringly violated and, more importantly, the petition is meritorious.

The proper recourse of an aggrieved party from a decision of the CA is a petition for review on certiorari under Rule 45 of the Rules of Court.  However, if the error, subject of the recourse, is one of jurisdiction, or the act complained of was perpetrated by a court with grave abuse of discretion amounting to lack or excess of jurisdiction, the proper remedy available to the aggrieved party is a petition for certiorari under Rule 65 of the said Rules.  As enunciated by the Court in Fortich   vs. Corona :[19]

Anent the first issue, in order to determine whether the recourse of petitioners is proper or not, it is necessary to draw a line between an error of judgment and an error of jurisdiction.  An error of judgment is one which the court may commit in the exercise of its jurisdiction, and which error is reviewable only by an appeal.  On the other hand, an error of jurisdiction is one where the act complained of was issued by the court, officer or a quasi-judicial body without or in excess of jurisdiction, or with grave abuse of discretion which is tantamount to lack or in

excess of jurisdiction.  This error is correctible only by the extraordinary writ of certiorari.[20] (Emphasis supplied).

Inasmuch as the present petition principally assails the dismissal of the petition on ground of procedural flaws involving the jurisdiction of the court a quo to entertain the petition, it falls within the ambit of a special civil action for certiorari under Rule 65 of the Rules of Court.

At the time the instant petition for certiorari was filed, i.e., on July 17, 1997, the prevailing rule is the newly promulgated 1997 Rules of Civil Procedure.  However, considering that the CA Resolution being assailed was rendered on March 21, 1997, the applicable rule is the three-month reglementary period, established by jurisprudence.[21] Petitioner received notice of the assailed CA Resolution dismissing his petition for review on April 4, 1997.  He filed his motion reconsideration on April 17, 1997, using up only thirteen days of the 90-day period. Petitioner received the CA Resolution denying his motion on July 3, 1997 and fourteen days later, or on July 17, 1997, he filed a motion for 30-day extension of time to file a “petition for review” which was granted by us; and petitioner duly filed his petition on August 15, 1997, which is well-within the period of extension granted to him.

We now go to the merits of the case.

We find the instant petition partly meritorious.

The requirement regarding the need for a certification of non-forum shopping in cases filed before the CA and the corresponding sanction for non-compliance thereto are found in the then prevailing Revised Circular No. 28-91.[22] It provides that the petitioner himself must make the certification against forum shopping and a violation thereof shall be a cause for the summary dismissal of the multiple petition or complaint. The rationale for the rule of personal execution of the certification by the petitioner himself is that it is only the petitioner who has actual knowledge of whether or not he has initiated similar actions or proceedings in other courts or tribunals; even counsel of record may be unaware of such fact.[23] The Court has ruled that with respect to the contents of the certification, the rule on substantial compliance may be availed of.  This is so because the requirement of strict compliance with the rule regarding the certification of non-forum shopping simply underscores its mandatory nature in that the certification cannot be altogether dispensed with or its requirements completely disregarded, but it does not thereby interdict substantial compliance with its provisions under justifiable circumstances.[24]

The petition for review filed before the CA contains a certification against forum shopping but said certification was signed by petitioner’s counsel.  In submitting the certification of non-forum shopping duly signed by himself in his motion for

Page 6: Jurisdiction -- Rem

reconsideration,[25] petitioner has aptly drawn the Court’s attention to the physical impossibility of filing the petition for review within the 15-day reglementary period to appeal considering that he is a resident of 1125 South Jefferson Street, Roanoke, Virginia, U.S.A. were he to personally accomplish and sign the certification.

We fully agree with petitioner that it was physically impossible for the petition to have been prepared and sent to the petitioner in the United States, for him to travel from Virginia, U.S.A. to the nearest Philippine Consulate in Washington, D.C., U.S.A., in order to sign the certification before the Philippine Consul, and for him to send back the petition to the Philippines within the 15-day reglementary period.  Thus, we find that petitioner has adequately explained his failure to personally sign the certification which justifies relaxation of the rule.

We have stressed that the rules on forum shopping, which were precisely designed to promote and facilitate the orderly administration of justice, should not be interpreted with such absolute literalness as to subvert its own ultimate and legitimate objective[26] which is simply to prohibit and penalize the evils of forum-shopping.[27] The subsequent filing of the certification duly signed by the petitioner himself should thus be deemed substantial compliance, pro hac vice.

In like manner, the failure of the petitioner to comply with Section 3, paragraph b, Rule 6 of the RIRCA, that is, to append to his petition copies of the pleadings and other material portions of the records as would support the petition, does not justify the outright dismissal of the petition.  It must be emphasized that the RIRCA gives the appellate court a certain leeway to require parties to submit additional documents as may be necessary in the interest of substantial justice.  Under Section 3, paragraph d of Rule 3 of the RIRCA,[28] the CA may require the parties to complete the annexes as the court deems necessary, and if the petition is given due course, the CA may require the elevation of a complete record of the case as provided for under Section 3(d)(5) of Rule 6 of the RIRCA.[29] At any rate, petitioner attached copies of the pleadings and other material portions of the records below with his motion for reconsideration.[30] In Jaro vs. Court of Appeals,[31] the Court reiterated the doctrine laid down in Cusi -Hernandez vs. Diaz [32]  and Piglas-Kamao   vs. National Labor Relations Commission [33] that subsequent submission of the missing documents with the motion for reconsideration amounts to substantial compliance which calls for the relaxation of the rules of procedure.  We find no cogent reason to depart from this doctrine.

Truly, in dismissing the petition for review, the CA had committed grave abuse of discretion amounting to lack of jurisdiction in putting a premium on technicalities at the expense of a just resolution of the case.

Needless to stress, "a litigation is not a game of technicalities."[34] When technicality deserts its function of being an aid to justice, the Court is justified in exempting from its operations a particular case.[35] Technical rules of procedure should be used to promote, not frustrate justice.  While the swift unclogging of court dockets is a laudable objective, granting substantial justice is an even more urgent ideal.[36]

The Court’s pronouncement in Republic vs. Court of Appeals [37]  is worth echoing: “cases should be determined on the merits, after full opportunity to all parties for ventilation of their causes and defenses, rather than on technicality or some procedural imperfections.  In that way, the ends of justice would be better served.”[38] Thus, what should guide judicial action is that a party litigant is given the fullest opportunity to establish the merits of his action or defense rather than for him to lose life, honor or property on mere technicalities.[39]This guideline is especially true when the petitioner has satisfactorily explained the lapse and fulfilled the requirements in his motion for reconsideration,[40] as in this case.

In addition, petitioner prays that we decide the present petition on the merits without need of remanding the case to the CA. He insists that all the elements of unlawful detainer are present in the case.  He further argues that the alleged “priority right to buy the lot they occupy” does not apply where the landowner does not intend to sell the subject property, as in the case;  that respondents cannot be entitled to protection under P.D. No. 2016 since the government has no intention of acquiring the subject property, nor is the subject property located within a zonal improvement area;  and, that assuming that there is a negotiation for the sale of the subject property or a pending case for consignation of rentals, these do not bar the eviction of respondents.

We are not persuaded. We shall refrain from ruling on the foregoing issues in the present petition for certiorari.  The issues involved are factual issues which inevitably require the weighing of evidence. These are matters that are beyond the province of this Court in a special civil action for certiorari. These issues are best addressed to the CA in the petition for review filed before it.  As an appellate court, it is empowered to require parties to submit additional documents, as it may find necessary, or to receive evidence, to promote the ends of justice, pursuant to the last paragraph of Section 9, B.P. Blg. 129, otherwise known as The Judiciary Reorganization Act of 1980, to wit:

The Intermediate Appellate Court 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.

WHEREFORE, the petition is PARTLY GRANTED. The Resolutions dated March 21, 1997 and June 23, 1997 of the Court of Appeals in CA-G.R. SP No. 41394 are REVERSED and SET ASIDE.  The case is REMANDED to the Court of Appeals for further proceedings in CA-G.R. No. 41394, entitled, “Antonio T. Donato vs. Hon. Judge of the Regional Trial Court of Manila, Branch 47, Filomeno Arcepe, et al.”

SO ORDERED.

Puno, (Chairman), Quisumbing, Callejo, Sr., and Tinga, JJ., concur.

Page 7: Jurisdiction -- Rem

G.R. No. 144025           December 27, 2002

SPS. RENE GONZAGA and LERIO GONZAGA, petitioners, vs.HON. COURT OF APPEALS, Second Division, Manila, HON. QUIRICO G. DEFENSOR, Judge, RTC, Branch 36, Sixth Judicial Region, Iloilo City, and LUCKY HOMES, INC., represented by WILSON JESENA, JR., as Manager, respondents.

D E C I S I O N

CORONA, J.:

Before this Court is a petition for review on certiorari seeking the reversal of the decision1 of the Court of Appeals dated December 29, 1999 and its resolution dated June 1, 2000 in CA-G.R. SP No. 54587.

The records disclose that, sometime in 1970, petitioner-spouses purchased a parcel of land from private respondent Lucky Homes, Inc., situated in Iloilo and containing an area of 240 square meters. Said lot was specifically denominated as Lot No. 19 under Transfer Certificate of Title (TCT) No. 28254 and was mortgaged to the Social Security System (SSS) as security for their housing loan. Petitioners then started the construction of their house, not on Lot No. 19 but on Lot No. 18, as private respondent mistakenly identified Lot No. 18 as Lot No. 19. Upon realizing its error, private respondent, through its general manager, informed petitioners of such mistake but the latter offered to buy Lot No. 18 in order to widen their premises. Thus, petitioners continued with the construction of their house. However, petitioners defaulted in the payment of their housing loan from SSS. Consequently, Lot No. 19 was foreclosed by SSS and petitioners’ certificate of title was cancelled and a new one was issued in the name of SSS. After Lot No. 19 was foreclosed, petitioners offered to swap Lot Nos. 18 and 19 and demanded from private respondent that their contract of sale be reformed and another deed of sale be executed with respect to Lot No. 18, considering that their house was built therein. However, private respondent refused. This prompted petitioners to file, on June 13, 1996, an action for reformation of contract and damages with the Regional Trial Court of Iloilo City, Branch 36, which was docketed as Civil Case No. 17115.

On January 15, 1998, the trial court2 rendered its decision dismissing the complaint for lack of merit and ordering herein petitioners to pay private respondent the amount of P10,000 as

moral damages and another P10,000 as attorney’s fees. The pertinent conclusion of the trial court reads as follows:

"Aware of such fact, the plaintiff nonetheless continued to stay in the premises of Lot 18 on the proposal that he would also buy the same. Plaintiff however failed to buy Lot 18 and likewise defaulted in the payment of his loan with the SSS involving Lot 19. Consequently Lot 19 was foreclosed and sold at public auction. Thereafter TCT No. T-29950 was cancelled and in lieu thereof TCT No. T-86612 (Exh. ‘9’) was issued in favor of SSS. This being the situation obtaining, the reformation of instruments, even if allowed, or the swapping of Lot 18 and Lot 19 as earlier proposed by the plaintiff, is no longer feasible considering that plaintiff is no longer the owner of Lot 19, otherwise, defendant will be losing Lot 18 without any substitute therefore (sic). Upon the other hand, plaintiff will be unjustly enriching himself having in its favor both Lot 19 which was earlier mortgaged by him and subsequently foreclosed by SSS, as well as Lot 18 where his house is presently standing.

"The logic and common sense of the situation lean heavily in favor of the defendant. It is evident that what plaintiff had bought from the defendant is Lot 19 covered by TCT No. 28254 which parcel of land has been properly indicated in the instruments and not Lot 18 as claimed by the plaintiff. The contracts being clear and unmistakable, they reflect the true intention of the parties, besides the plaintiff failed to assail the contracts on mutual mistake, hence the same need no longer be reformed."3

On June 22, 1998, a writ of execution was issued by the trial court. Thus, on September 17, 1998, petitioners filed an urgent motion to recall writ of execution, alleging that the court a quo had no jurisdiction to try the case as it was vested in the Housing and Land Use Regulatory Board (HLURB) pursuant to PD 957 (The Subdivision and Condominium Buyers Protective Decree). Conformably, petitioners filed a new complaint against private respondent with the HLURB. Likewise, on June 30, 1999, petitioner-spouses filed before the Court of Appeals a petition for annulment of judgment, premised on the ground that the trial court had no jurisdiction to try and decide Civil Case No. 17115.

In a decision rendered on December 29, 1999, the Court of Appeals denied the petition for annulment of judgment, relying mainly on the jurisprudential doctrine of estoppel as laid down in the case of Tijam vs. Sibonghanoy.4

Their subsequent motion for reconsideration having been denied, petitioners filed this instant petition, contending that the Court of Appeals erred in dismissing the petition by applying the principle

of estoppel, even if the Regional Trial Court, Branch 36 of Iloilo City had no jurisdiction to decide Civil Case No. 17115.

At the outset, it should be stressed that petitioners are seeking from us the annulment of a trial court judgment based on lack of jurisdiction. Because it is not an appeal, the correctness of the judgment is not in issue here. Accordingly, there is no need to delve into the propriety of the decision rendered by the trial court.

Petitioners claim that the recent decisions of this Court have already abandoned the doctrine laid down in Tijam vs. Sibonghanoy.5 We do not agree. In countless decisions, this Court has consistently held that, while an order or decision rendered without jurisdiction is a total nullity and may be assailed at any stage, active participation in the proceedings in the court which rendered the order or decision will bar such party from attacking its jurisdiction. As we held in the leading case of Tijam vs. Sibonghanoy:6

"A party may be estopped or barred from raising a question in different ways and for different reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, and of estoppel by laches.

x x x

"It has been held that a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after

obtaining or failing to obtain such relief, repudiate, or question that same jurisdiction x x x x [T]he question whether the court had jurisdiction either of the subject matter of the action or of the parties was not important in such cases because the party is

barred from such conduct not because the judgment or order of the court is valid and conclusive as an adjudication, but for the

reason that such a practice can not be tolerated –– obviously for reasons of public policy."

Tijam has been reiterated in many succeeding cases. Thus, in Orosa vs. Court of Appeals;7 Ang Ping vs. Court of Appeals;8 Salva vs. Court of Appeals;9 National Steel Corporation vs. Court of Appeals;10 Province of Bulacan vs. Court of Appeals;11 PNOC Shipping and Transport Corporation vs. Court of Appeals,12 this Court affirmed the rule that a party’s active participation in all stages of the case before the trial court, which includes invoking the court’s authority to grant affirmative relief, effectively estops such party from later challenging that same court’s jurisdiction.

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In the case at bar, it was petitioners themselves who invoked the jurisdiction of the court a quo by instituting an action for reformation of contract against private respondents. It appears that, in the proceedings before the trial court, petitioners vigorously asserted their cause from start to finish. Not even once did petitioners ever raise the issue of the court’s jurisdiction during the entire proceedings which lasted for two years. It was only after the trial court rendered its decision and issued a writ of execution against them in 1998 did petitioners first raise the issue of jurisdiction ─ and it was only because said decision was unfavorable to them. Petitioners thus effectively waived their right to question the court’s jurisdiction over the case they themselves filed.

Petitioners should bear the consequence of their act. They cannot be allowed to profit from their omission to the damage and prejudice of the private respondent. This Court frowns upon the undesirable practice of a party submitting his case for decision and then accepting the judgment but only if favorable, and attacking it for lack of jurisdiction if not.13

Public policy dictates that this Court must strongly condemn any double-dealing by parties who are disposed to trifle with the courts by deliberately taking inconsistent positions, in utter disregard of the elementary principles of justice and good faith.14 There is no denying that, in this case, petitioners never raised the issue of jurisdiction throughout the entire proceedings in the trial court. Instead, they voluntarily and willingly submitted themselves to the jurisdiction of said court. It is now too late in the day for them to repudiate the jurisdiction they were invoking all along.

WHEREFORE, the petition for review is hereby DENIED.

SO ORDERED.

Puno, (Chairman), Panganiban, Sandoval-Gutierrez, and Morales, JJ., concur.

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[G.R. No. 124644.  February 5, 2004]ARNEL ESCOBAL, petitioner, vs. HON. FRANCIS

GARCHITORENA, Presiding Justice of the Sandiganbayan, Atty. Luisabel Alfonso-Cortez, Executive Clerk of Court IV of the Sandiganbayan, Hon. David C. Naval, Presiding Judge of the Regional Trial Court of Naga City, Branch 21, Luz N. Nueca,respondents.

D E C I S I O NCALLEJO, SR., J.:

This is a petition for certiorari with a prayer for the issuance of a temporary restraining order and preliminary injunction filed by Arnel Escobal seeking the nullification of the remand by the Presiding Justice of the Sandiganbayan of the records of Criminal Case No. 90-3184 to the Regional Trial Court (RTC) of Naga City, Branch 21.

The petition at bench arose from the following milieu:

The petitioner is a graduate of the Philippine Military Academy, a member of the Armed Forces of the Philippines and the Philippine Constabulary, as well as the Intelligence Group of the Philippine National Police. On March 16, 1990, the petitioner was conducting surveillance operations on drug trafficking at the Sa Harong Café Bar and Restaurant located along Barlin St., Naga City. He somehow got involved in a shooting incident, resulting in the death of one Rodney Rafael N. Nueca. On February 6, 1991, an amended Information was filed with the RTC of Naga City, Branch 21, docketed as Criminal Case No. 90-3184 charging the petitioner and a certain Natividad Bombita, Jr. alias “Jun Bombita” with murder.  The accusatory portion of the amended Information reads:

That on or about March 16, 1990, in the City of Naga, Philippines, and within the jurisdiction of this Honorable Court by virtue of the Presidential Waiver, dated June 1, 1990, with intent to kill, conspiring and confederating together and mutually helping each other, did, then and there, willfully, unlawfully and feloniously attack, assault and maul one Rodney Nueca and accused 2Lt Arnel Escobal armed with a caliber .45 service pistol shoot said Rodney Nueca thereby inflicting upon him serious, mortal and fatal wounds which caused his death, and as a consequence thereof, complainant LUZ N. NUECA, mother of the deceased victim, suffered actual and compensatory damages in the amount of THREE HUNDRED SIXTY-SEVEN THOUSAND ONE HUNDRED SEVEN & 95/100 ( P 367,107.95) PESOS, Philippine Currency, and moral and exemplary damages in the amount of ONE HUNDRED THIRTY-FIVE THOUSAND ( P 135,000.00) PESOS, Philippine Currency.[1]

On March 19, 1991, the RTC issued an Order preventively suspending the petitioner from the service under Presidential

Decree No. 971, as amended by P.D. No. 1847.  When apprised of the said order, the General Headquarters of the PNP issued on October 6, 1992 Special Order No. 91, preventively suspending the petitioner from the service until the case was terminated.[2]

The petitioner was arrested by virtue of a warrant issued by the RTC, while accused Bombita remained at large.  The petitioner posted bail and was granted temporary liberty.

When arraigned on April 9, 1991,[3] the petitioner, assisted by counsel, pleaded not guilty to the offense charged.  Thereafter, on December 23, 1991, the petitioner filed a Motion to Quash [4] the Information alleging that as mandated by Commonwealth Act No. 408,[5] in relation to Section 1, Presidential Decree No. 1822 and Section 95 of R.A. No. 6975, the court martial, not the RTC, had jurisdiction over criminal cases involving PNP members and officers.

Pending the resolution of the motion, the petitioner on June 25, 1993 requested the Chief of the PNP for his reinstatement. He alleged that under R.A. No. 6975, his suspension should last for only 90 days, and, having served the same, he should now be reinstated.  On September 23, 1993,[6] the PNP Region V Headquarters wrote Judge David C. Naval requesting information on whether he issued an order lifting the petitioner’s suspension.  The RTC did not reply.  Thus, on February 22, 1994, the petitioner filed a motion in the RTC for the lifting of the order of suspension. He alleged that he had served the 90-day preventive suspension and pleaded for compassionate justice.  The RTC denied the motion on March 9, 1994.[7] Trial thereafter proceeded, and the prosecution rested its case.  The petitioner commenced the presentation of his evidence.  On July 20, 1994, he filed a Motion to Dismiss[8] the case. CitingRepublic of the Philippines v. Asuncion, et al.,[9] he argued that since he committed the crime in the performance of his duties, the Sandiganbayan had exclusive jurisdiction over the case.

On October 28, 1994, the RTC issued an Order[10] denying the motion to dismiss.  It, however, ordered the conduct of a preliminary hearing to determine whether or not the crime charged was committed by the petitioner in relation to his office as a member of the PNP.

In the preliminary hearing, the prosecution manifested that it was no longer presenting any evidence in connection with the petitioner’s motion. It reasoned that it had already rested its case, and that its evidence showed that the petitioner did not commit the offense charged in connection with the performance of his duties as a member of the Philippine Constabulary. According to the prosecution, they were able to show the following facts:  (a) the petitioner was not wearing his uniform during the incident; (b) the offense was committed just after midnight; (c) the petitioner was drunk when the crime was committed; (d) the petitioner was in the

company of civilians; and, (e) the offense was committed in a beerhouse called “Sa Harong Café Bar and Restaurant.”[11]

For his part, the petitioner testified that at about 10:00 p.m. on March 15, 1990, he was at the Sa Harong Café Bar and Restaurant at Barlin St., Naga City, to conduct surveillance on alleged drug trafficking, pursuant to Mission Order No. 03-04 issued by Police Superintendent Rufo R. Pulido.  The petitioner adduced in evidence the sworn statements of Benjamin Cariño and Roberto Fajardo who corroborated his testimony that he was on a surveillance mission on the aforestated date.[12]

On July 31, 1995, the trial court issued an Order declaring that the petitioner committed the crime charged while not in the performance of his official function.  The trial court added that upon the enactment of R.A. No. 7975,[13] the issue had become moot and academic. The amendatory law transferred the jurisdiction over the offense charged from the Sandiganbayan to the RTC since the petitioner did not have a salary grade of “27” as provided for in or by Section 4(a)(1), (3) thereof.  The trial court nevertheless ordered the prosecution to amend the Information pursuant to the ruling in Republic v. Asuncion[14] and R.A. No. 7975. The amendment consisted in the inclusion therein of an allegation that the offense charged was not committed by the petitioner in the performance of his duties/functions, nor in relation to his office.

The petitioner filed a motion for the reconsideration [15] of the said order, reiterating that based on his testimony and those of Benjamin Cariño and Roberto Fajardo, the offense charged was committed by him in relation to his official functions.  He asserted that the trial court failed to consider the exceptions to the prohibition. He asserted that R.A. No. 7975, which was enacted on March 30, 1995, could not be applied retroactively.[16]

The petitioner further alleged that Luz Nacario Nueca, the mother of the victim, through counsel, categorically and unequivocably admitted in her complaint filed with the People’s Law Enforcement Board (PLEB) that he was on an official mission when the crime was committed.

On November 24, 1995, the RTC made a volte face and issued an Order reversing and setting aside its July 31, 1995 Order.  It declared that based on the petitioner’s evidence, he was on official mission when the shooting occurred.  It concluded that the prosecution failed to adduce controverting evidence thereto.  It likewise considered Luz Nacario Nueca’s admission in her complaint before the PLEB that the petitioner was on official mission when the shooting happened.

The RTC ordered the public prosecutor to file a Re-Amended Information and to allege that the offense charged was committed by the petitioner in the performance of his duties/functions or in relation to his office; and, conformably to

Page 10: Jurisdiction -- Rem

R.A. No. 7975, to thereafter transmit the same, as well as the complete records with the stenographic notes, to the Sandiganbayan, to wit:

WHEREFORE, the Order dated July 31, 1995 is hereby SET ASIDE and RECONSIDERED, and it is hereby declared that after preliminary hearing, this Court has found that the offense charged in the Information herein was committed by the accused in his relation to his function and duty as member of the then Philippine Constabulary.

Conformably with R.A. No. 7975 and the ruling of the Supreme Court in Republic v. Asuncion, et al., G.R. No. 180208, March 11, 1994:

(1)          The City Prosecutor is hereby ordered to file a Re-Amended Information alleging that the offense charged was committed by the Accused in the performance of his duties/functions or in relation to his office, within fifteen (15) days from receipt hereof;

(2)          After the filing of the Re-Amended Information, the complete records of this case, together with the transcripts of the stenographic notes taken during the entire proceedings herein, are hereby ordered transmitted immediately to the Honorable Sandiganbayan, through its Clerk of Court, Manila, for appropriate proceedings.[17]

On January 8, 1996, the Presiding Justice of the Sandiganbayan ordered the Executive Clerk of Court IV, Atty. Luisabel Alfonso-Cortez, to return the records of Criminal Case No. 90-3184 to the court of origin, RTC of Naga City, Branch 21. It reasoned that under P.D. No. 1606, as amended by R.A. No. 7975,[18] the RTC retained jurisdiction over the case, considering that the petitioner had a salary grade of “23.”  Furthermore, the prosecution had already rested its case and the petitioner had commenced presenting his evidence in the RTC; following the rule on continuity of jurisdiction, the latter court should continue with the case and render judgment therein after trial.

Upon the remand of the records, the RTC set the case for trial on May 3, 1996, for the petitioner to continue presenting his evidence.  Instead of adducing his evidence, the petitioner filed a petition for certiorari, assailing the Order of the Presiding Justice of the Sandiganbayan remanding the records of the case to the RTC.

The threshold issue for resolution is whether or not the Presiding Justice of the Sandiganbayan committed a grave abuse of his discretion amounting to excess or lack of jurisdiction in ordering the remand of the case to the RTC.

The petitioner contends that when the amended information was filed with the RTC on February 6, 1991, P.D. No. 1606 was

still in effect.  Under Section 4(a) of the decree, the Sandiganbayan had exclusive jurisdiction over the case against him as he was charged with homicide with the imposable penalty of reclusion temporal, and the crime was committed while in the performance of his duties.  He further asserts that although P.D. No. 1606, as amended by P.D. No. 1861 and by R.A. No. 7975 provides that crimes committed by members and officers of the PNP with a salary grade below “27” committed in relation to office are within the exclusive jurisdiction of the proper RTC, the amendment thus introduced by R.A. No. 7975 should not be applied retroactively.  This is so, the petitioner asserts, because under Section 7 of R.A. No. 7975, only those cases where trial has not begun in the Sandiganbayan upon the effectivity of the law should be referred to the proper trial court.

The private complainant agrees with the contention of the petitioner.  In contrast, the Office of the Special Prosecutor contends that the Presiding Justice of the Sandiganbayan acted in accordance with law when he ordered the remand of the case to the RTC.  It asserts that R.A. No. 7975 should be applied retroactively.  Although the Sandiganbayan had jurisdiction over the crime committed by the petitioner when the amended information was filed with the RTC, by the time it resolved petitioner’s motion to dismiss on July 31, 1995, R.A. No. 7975 had already taken effect.  Thus, the law should be given retroactive effect.

The Ruling of the Court

The respondent Presiding Justice acted in accordance with law and the rulings of this Court when he ordered the remand of the case to the RTC, the court of origin.

The jurisdiction of the court over criminal cases is determined by the allegations in the Information or the Complaint and the statute in effect at the time of the commencement of the action, unless such statute provides for a retroactive application thereof.  The jurisdictional requirements must be alleged in the Information.[19] Such jurisdiction of the court acquired at the inception of the case continues until the case is terminated.[20]

Under Section 4(a) of P.D. No. 1606 as amended by P.D. No. 1861, the Sandiganbayan had exclusive jurisdiction in all cases involving the following:

(1)     Violations of Republic Act No. 3019, as amended, otherwise known as the Anti-Graft and Corrupt Practices Act, Republic Act No. 1379, and Chapter II, Section 2, Title VII of the Revised Penal Code;

(2)     Other offenses or felonies committed by public officers and employees in relation to their office, including those employed in government-owned or controlled corporations, whether simple or

complexed with other crimes, where the penalty prescribed by law is higher than prision correccional or imprisonment for six (6) years, or a fine of P6,000.00 ….[21]

However, for the Sandiganbayan to have exclusive jurisdiction under the said law over crimes committed by public officers in relation to their office, it is essential that the facts showing the intimate relation between the office of the offender and the discharge of official duties must be alleged in the Information.  It is not enough to merely allege in the Information that the crime charged was committed by the offender in relation to his office because that would be a conclusion of law.[22] The amended Information filed with the RTC against the petitioner does not contain any allegation showing the intimate relation between his office and the discharge of his duties.  Hence, the RTC had jurisdiction over the offense charged when on November 24, 1995, it ordered the re-amendment of the Information to include therein an allegation that the petitioner committed the crime in relation to office. The trial court erred when it ordered the elevation of the records to the Sandiganbayan.  It bears stressing that R.A. No. 7975 amending P.D. No. 1606 was already in effect and under Section 2 of the law:

In cases where none of the principal accused are occupying positions corresponding to salary grade “27” or higher, as prescribed in the said Republic Act No. 6758, or PNP officers occupying the rank of superintendent or higher, or their equivalent, exclusive 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 jurisdiction as provided in Batas Pambansa Blg. 129.

Under the law, even if the offender committed the crime charged in relation to his office but occupies a position corresponding to a salary grade below “27,” the proper Regional Trial Court or Municipal Trial Court, as the case may be, shall have exclusive jurisdiction over the case.  In this case, the petitioner was a Police Senior Inspector, with salary grade “23.”  He was charged with homicide punishable by reclusion temporal.  Hence, the RTC had exclusive jurisdiction over the crime charged conformably to Sections 20 and 32 of Batas Pambansa Blg. 129, as amended by Section 2 of R.A. No. 7691.

The petitioner’s contention that R.A. No. 7975 should not be applied retroactively has no legal basis.  It bears stressing that R.A. No. 7975 is a substantive procedural law which may be applied retroactively.[23] IN LIGHT OF ALL THE FOREGOING, the petition is DISMISSED.  No pronouncement as to costs. SO ORDERED. Puno, (Chairman), Quisumbing, Austria-Martinez, and Tinga, JJ., concur.

Page 11: Jurisdiction -- Rem

G.R. No. 155001             January 21, 2004

DEMOSTHENES P. AGAN, JR., JOSEPH B. CATAHAN, JOSE MARI B. REUNILLA, MANUEL ANTONIO B. BOÑE, MAMERTO S. CLARA, REUEL E. DIMALANTA, MORY V. DOMALAON, CONRADO G. DIMAANO, LOLITA R. HIZON, REMEDIOS P. ADOLFO, BIENVENIDO C. HILARIO, MIASCOR WORKERS UNION-NATIONAL LABOR UNION (MWU-NLU), and PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION (PALEA),petitioners, vs.PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS and SECRETARY LEANDRO M. MENDOZA, in his capacity as Head of the Department of Transportation and Communications, respondents,

MIASCOR GROUNDHANDLING CORPORATION, DNATA-WINGS AVIATION SYSTEMS CORPORATION, MACROASIA-EUREST SERVICES, INC., MACROASIA-MENZIES AIRPORT SERVICES CORPORATION, MIASCOR CATERING SERVICES CORPORATION, MIASCOR AIRCRAFT MAINTENANCE CORPORATION, and MIASCOR LOGISTICS CORPORATION, Petitioners-in-Intervention,

FLORESTE ALCONIS, GINA ALNAS, REY AMPOLOQUIO, ROSEMARIE ANG, EUGENE ARADA, NENETTE BARREIRO, NOEL BARTOLOME, ALDRIN BASTADOR, ROLETTE DIVINE BERNARDO, MINETTE BRAVO, KAREN BRECILLA, NIDA CAILAO, ERWIN CALAR, MARIFEL CONSTANTINO, JANETTE CORDERO, ARNOLD FELICITAS, MARISSA GAYAGOY, ALEX GENERILLO, ELIZABETH GRAY, ZOILO HERICO, JACQUELINE IGNACIO, THELMA INFANTE, JOEL JUMAO-AS, MARIETTA LINCHOCO, ROLLY LORICO, FRANCIS AUGUSTO MACATOL, MICHAEL MALIGAT, DENNIS MANALO, RAUL MANGALIMAN, JOEL MANLANGIT, CHARLIE MENDOZA, HAZNAH MENDOZA, NICHOLS MORALES, ALLEN OLAÑO, CESAR ORTAL, MICHAEL ORTEGA, WAYNE PLAZA, JOSELITO REYES, ROLANDO REYES, AILEEN SAPINA, RAMIL TAMAYO, PHILLIPS TAN, ANDREW UY, WILLIAM VELASCO, EMILIO VELEZ, NOEMI YUPANO, MARY JANE ONG, RICHARD RAMIREZ, CHERYLE MARIE ALFONSO, LYNDON BAUTISTA, MANUEL CABOCAN AND NEDY LAZO, Respondents-in-Intervention,

NAGKAISANG MARALITA NG TAÑONG ASSOCIATION, INC., Respondents-in-Intervention,

x - - - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 155547 January 21, 2004

SALACNIB F. BATERINA, CLAVEL A. MARTINEZ and CONSTANTINO G. JARAULA, petitioners, vs.PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS, DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS, SECRETARY LEANDRO M. MENDOZA, in his capacity as Head of the Department of Transportation and Communications, and SECRETARY SIMEON A. DATUMANONG, in his capacity as Head of the Department of Public Works and Highways, respondents, JACINTO V. PARAS, RAFAEL P. NANTES, EDUARDO C. ZIALCITA, WILLY BUYSON VILLARAMA, PROSPERO C. NOGRALES, PROSPERO A. PICHAY, JR., HARLIN CAST ABAYON, and BENASING O. MACARANBON, Respondents-Intervenors,

FLORESTE ALCONIS, GINA ALNAS, REY AMPOLOQUIO, ROSEMARIE ANG, EUGENE ARADA, NENETTE BARREIRO, NOEL BARTOLOME, ALDRIN BASTADOR, ROLETTE DIVINE BERNARDO, MINETTE BRAVO, KAREN BRECILLA, NIDA CAILAO, ERWIN CALAR, MARIFEL CONSTANTINO, JANETTE CORDERO, ARNOLD FELICITAS, MARISSA GAYAGOY, ALEX GENERILLO, ELIZABETH GRAY, ZOILO HERICO, JACQUELINE IGNACIO, THELMA INFANTE, JOEL JUMAO-AS, MARIETTA LINCHOCO, ROLLY LORICO, FRANCIS AUGUSTO MACATOL, MICHAEL MALIGAT, DENNIS MANALO, RAUL MANGALIMAN, JOEL MANLANGIT, CHARLIE MENDOZA, HAZNAH MENDOZA, NICHOLS MORALES, ALLEN OLAÑO, CESAR ORTAL, MICHAEL ORTEGA, WAYNE PLAZA, JOSELITO REYES, ROLANDO REYES, AILEEN SAPINA, RAMIL TAMAYO, PHILLIPS TAN, ANDREW UY, WILLIAM VELASCO, EMILIO VELEZ, NOEMI YUPANO, MARY JANE ONG, RICHARD RAMIREZ, CHERYLE MARIE ALFONSO, LYNDON BAUTISTA, MANUEL CABOCAN AND NEDY LAZO, Respondents-in-Intervention,

NAGKAISANG MARALITA NG TAÑONG ASSOCIATION, INC., Respondents-in-Intervention,

x - - - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 155661 January 21, 2004

CEFERINO C. LOPEZ, RAMON M. SALES, ALFREDO B. VALENCIA, MA. TERESA V. GAERLAN, LEONARDO DE LA ROSA, DINA C. DE LEON, VIRGIE CATAMIN, RONALD SCHLOBOM, ANGELITO SANTOS, MA. LUISA M. PALCON

and SAMAHANG MANGGAGAWA SA PALIPARAN NG PILIPINAS (SMPP), petitioners, vs.PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS, SECRETARY LEANDRO M. MENDOZA, in his capacity as Head of the Department of Transportation and Communications, respondents,

FLORESTE ALCONIS, GINA ALNAS, REY AMPOLOQUIO, ROSEMARIE ANG, EUGENE ARADA, NENETTE BARREIRO, NOEL BARTOLOME, ALDRIN BASTADOR, ROLETTE DIVINE BERNARDO, MINETTE BRAVO, KAREN BRECILLA, NIDA CAILAO, ERWIN CALAR, MARIFEL CONSTANTINO, JANETTE CORDERO, ARNOLD FELICITAS, MARISSA GAYAGOY, ALEX GENERILLO, ELIZABETH GRAY, ZOILO HERICO, JACQUELINE IGNACIO, THELMA INFANTE, JOEL JUMAO-AS, MARIETTA LINCHOCO, ROLLY LORICO, FRANCIS AUGUSTO MACATOL, MICHAEL MALIGAT, DENNIS MANALO, RAUL MANGALIMAN, JOEL MANLANGIT, CHARLIE MENDOZA, HAZNAH MENDOZA, NICHOLS MORALES, ALLEN OLAÑO, CESAR ORTAL, MICHAEL ORTEGA, WAYNE PLAZA, JOSELITO REYES, ROLANDO REYES, AILEEN SAPINA, RAMIL TAMAYO, PHILLIPS TAN, ANDREW UY, WILLIAM VELASCO, EMILIO VELEZ, NOEMI YUPANO, MARY JANE ONG, RICHARD RAMIREZ, CHERYLE MARIE ALFONSO, LYNDON BAUTISTA, MANUEL CABOCAN AND NEDY LAZO, Respondents-in-Intervention,

NAGKAISANG MARALITA NG TAÑONG ASSOCIATION, INC., Respondents-in-Intervention.

R E S O L U T I O N

PUNO, J.:

Before this Court are the separate Motions for Reconsideration filed by respondent Philippine International Air Terminals Co., Inc. (PIATCO), respondents-intervenors Jacinto V. Paras, Rafael P. Nantes, Eduardo C. Zialcita, Willie Buyson Villarama, Prospero C. Nograles, Prospero A. Pichay, Jr., Harlin Cast Abayon and Benasing O. Macaranbon, all members of the House of Representatives (Respondent Congressmen),1 respondents-intervenors who are employees of PIATCO and other workers of the Ninoy Aquino International Airport International Passenger Terminal III (NAIA IPT III) (PIATCO Employees)2 and respondents-intervenors Nagkaisang Maralita ng Tañong Association, Inc., (NMTAI)3 of the Decision of this Court dated

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May 5, 2003 declaring the contracts for the NAIA IPT III project null and void.

Briefly, the proceedings. On October 5, 1994, Asia’s Emerging Dragon Corp. (AEDC) submitted an unsolicited proposal to the Philippine Government through the Department of Transportation and Communication (DOTC) and Manila International Airport Authority (MIAA) for the construction and development of the NAIA IPT III under a build-operate-and-transfer arrangement pursuant to R.A. No. 6957, as amended by R.A. No. 7718 (BOT Law).4In accordance with the BOT Law and its Implementing Rules and Regulations (Implementing Rules), the DOTC/MIAA invited the public for submission of competitive and comparative proposals to the unsolicited proposal of AEDC. On September 20, 1996 a consortium composed of the People’s Air Cargo and Warehousing Co., Inc. (Paircargo), Phil. Air and Grounds Services, Inc. (PAGS) and Security Bank Corp. (Security Bank) (collectively, Paircargo Consortium), submitted their competitive proposal to the Prequalification Bids and Awards Committee (PBAC).

After finding that the Paircargo Consortium submitted a bid superior to the unsolicited proposal of AEDC and after failure by AEDC to match the said bid, the DOTC issued the notice of award for the NAIA IPT III project to the Paircargo Consortium, which later organized into herein respondent PIATCO. Hence, on July 12, 1997, the Government, through then DOTC Secretary Arturo T. Enrile, and PIATCO, through its President, Henry T. Go, signed the "Concession Agreement for the Build-Operate-and-Transfer Arrangement of the Ninoy Aquino International Airport Passenger Terminal III" (1997 Concession Agreement). On November 26, 1998, the 1997 Concession Agreement was superseded by the Amended and Restated Concession Agreement (ARCA) containing certain revisions and modifications from the original contract. A series of supplemental agreements was also entered into by the Government and PIATCO. The First Supplement was signed on August 27, 1999, the Second Supplement on September 4, 2000, and the Third Supplement on June 22, 2001 (collectively, Supplements) (the 1997 Concession Agreement, ARCA and the Supplements collectively referred to as the PIATCO Contracts).

On September 17, 2002, various petitions were filed before this Court to annul the 1997 Concession Agreement, the ARCA and the Supplements and to prohibit the public respondents DOTC and MIAA from implementing them.

In a decision dated May 5, 2003, this Court granted the said petitions and declared the 1997 Concession Agreement, the ARCA and the Supplements null and void.

Respondent PIATCO, respondent-Congressmen and respondents-intervenors now seek the reversal of the May 5, 2003 decision and pray that the petitions be dismissed. In the alternative, PIATCO prays that the Court should not strike down the entire 1997 Concession Agreement, the ARCA and its supplements in light of their separability clause. Respondent-Congressmen and NMTAI also pray that in the alternative, the cases at bar should be referred to arbitration pursuant to the provisions of the ARCA. PIATCO-Employees pray that the petitions be dismissed and remanded to the trial courts for trial on the merits or in the alternative that the 1997 Concession Agreement, the ARCA and the Supplements be declared valid and binding.

IProcedural Matters

a. Lack of Jurisdiction

Private respondents and respondents-intervenors reiterate a number of procedural issues which they insist deprived this Court of jurisdiction to hear and decide the instant cases on its merits. They continue to claim that the cases at bar raise factual questions which this Court is ill-equipped to resolve, hence, they must be remanded to the trial court for reception of evidence. Further, they allege that although designated as petitions for certiorari and prohibition, the cases at bar are actually actions for nullity of contracts over which the trial courts have exclusive jurisdiction. Even assuming that the cases at bar are special civil actions for certiorari and prohibition, they contend that the principle of hierarchy of courts precludes this Court from taking primary jurisdiction over them.

We are not persuaded.

There is a question of fact when doubt or difference arises as to the truth or falsity of the facts alleged.5 Even a cursory reading of the cases at bar will show that the Court decided them by interpreting and applying the Constitution, the BOT Law, its Implementing Rules and other relevant legal principles on the basis of clearly undisputed facts. All the operative facts were settled, hence, there is no need for a trial type determination of their truth or falsity by a trial court.

We reject the unyielding insistence of PIATCO Employees that the following factual issues are critical and beyond the capability of this Court to resolve, viz: (a) whether the National Economic Development Authority- Investment Coordinating Committee (NEDA-ICC) approved the Supplements; (b) whether the First Supplement created ten (10) new financial obligations on the part

of the government; and (c) whether the 1997 Concession Agreement departed from the draft Concession Agreement contained in the Bid Documents.6

The factual issue of whether the NEDA-ICC approved the Supplements is hardly relevant. It is clear in our Decision that the PIATCO contracts were invalidated on other and more substantial grounds. It did not rely on the presence or absence of NEDA-ICC approval of the Supplements. On the other hand, the last two issues do not involve disputed facts. Rather, they involve contractual provisions which are clear and categorical and need only to be interpreted. The interpretation of contracts and the determination of whether their provisions violate our laws or contravene any public policy is a legal issue which this Court may properly pass upon.

Respondents’ corollary contention that this Court violated the hierarchy of courts when it entertained the cases at bar must also fail. The rule on hierarchy of courts in cases falling within the concurrent jurisdiction of the trial courts and appellate courts generally applies to cases involving warring factual allegations. For this reason, litigants are required to repair to the trial courts at the first instance to determine the truth or falsity of these contending allegations on the basis of the evidence of the parties. Cases which depend on disputed facts for decision cannot be brought immediately before appellate courts as they are not triers of facts.

It goes without saying that when cases brought before the appellate courts do not involve factual but legal questions, a strict application of the rule of hierarchy of courts is not necessary. As the cases at bar merely concern the construction of the Constitution, the interpretation of the BOT Law and its Implementing Rules and Regulations on undisputed contractual provisions and government actions, and as the cases concern public interest, this Court resolved to take primary jurisdiction over them. This choice of action follows the consistent stance of this Court to settle any controversy with a high public interest component in a single proceeding and to leave no root or branch that could bear the seeds of future litigation. The suggested remand of the cases at bar to the trial court will stray away from this policy.7

b. Legal Standing

Respondent PIATCO stands pat with its argument that petitioners lack legal personality to file the cases at bar as they are not real parties in interest who are bound principally or subsidiarily to the PIATCO Contracts. Further, respondent PIATCO contends that

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petitioners failed to show any legally demandable or enforceable right to justify their standing to file the cases at bar.

These arguments are not difficult to deflect. The determination of whether a person may institute an action or become a party to a suit brings to fore the concepts of real party in interest, capacity to sue and standing to sue. To the legally discerning, these three concepts are different although commonly directed towards ensuring that only certain parties can maintain an action.8 As defined in the Rules of Court, 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.9Capacity to sue deals with a situation where a person who may have a cause of action is disqualified from bringing a suit under applicable law or is incompetent to bring a suit or is under some legal disability that would prevent him from maintaining an action unless represented by a guardian ad litem. Legal standing is relevant in the realm of public law. In certain instances, courts have allowed private parties to institute actions challenging the validity of governmental action for violation of private rights or constitutional principles.10 In these cases, courts apply the doctrine of legal standing by determining whether the party has a direct and personal interest in the controversy and whether such party has sustained or is in imminent danger of sustaining an injury as a result of the act complained of, a standard which is distinct from the concept of real party in interest.11Measured by this yardstick, the application of the doctrine on legal standing necessarily involves a preliminary consideration of the merits of the case and is not purely a procedural issue.12

Considering the nature of the controversy and the issues raised in the cases at bar, this Court affirms its ruling that the petitioners have the requisite legal standing. The petitioners in G.R. Nos. 155001 and 155661 are employees of service providers operating at the existing international airports and employees of MIAA while petitioners-intervenors are service providers with existing contracts with MIAA and they will all sustain direct injury upon the implementation of the PIATCO Contracts. The 1997 Concession Agreement and the ARCA both provide that upon the commencement of operations at the NAIA IPT III, NAIA Passenger Terminals I and II will cease to be used as international passenger terminals.13 Further, the ARCA provides:

(d) For the purpose of an orderly transition, MIAA shall not renew any expired concession agreement relative to any service or operation currently being undertaken at the Ninoy Aquino International Airport Passenger Terminal I, or extend any concession agreement which may expire subsequent hereto, except to the extent that the continuation of the existing services and operations shall lapse on or before the In-Service Date.14

Beyond iota of doubt, the implementation of the PIATCO Contracts, which the petitioners and petitioners-intervenors denounce as unconstitutional and illegal, would deprive them of their sources of livelihood. Under settled jurisprudence, one's employment, profession, trade, or calling is a property right and is protected from wrongful interference.15 It is also self evident that the petitioning service providers stand in imminent danger of losing legitimate business investments in the event the PIATCO Contracts are upheld.

Over and above all these, constitutional and other legal issues with far-reaching economic and social implications are embedded in the cases at bar, hence, this Court liberally granted legal standing to the petitioning members of the House of Representatives. First, at stake is the build-operate-and–transfer contract of the country’s premier international airport with a projected capacity of 10 million passengers a year. Second, the huge amount of investment to complete the project is estimated to be P13,000,000,000.00. Third, the primary issues posed in the cases at bar demand a discussion and interpretation of the Constitution, the BOT Law and its implementing rules which have not been passed upon by this Court in previous cases. They can chart the future inflow of investment under the BOT Law.

Before writing finis to the issue of legal standing, the Court notes the bid of new parties to participate in the cases at bar as respondents-intervenors, namely, (1) the PIATCO Employees and (2) NMTAI (collectively, the New Respondents-Intervenors). After the Court’s Decision, the New Respondents-Intervenors filed separate Motions for Reconsideration-In-Intervention alleging prejudice and direct injury. PIATCO employees claim that "they have a direct and personal interest [in the controversy]... since they stand to lose their jobs should the government’s contract with PIATCO be declared null and void."16 NMTAI, on the other hand, represents itself as a corporation composed of responsible tax-paying Filipino citizens with the objective of "protecting and sustaining the rights of its members to civil liberties, decent livelihood, opportunities for social advancement, and to a good, conscientious and honest government."17

The Rules of Court govern the time of filing a Motion to Intervene. Section 2, Rule 19 provides that a Motion to Intervene should be filed "before rendition of judgment...." The New Respondents-Intervenors filed their separate motions after a decision has been promulgated in the present cases. They have not offered any worthy explanation to justify their late intervention. Consequently, their Motions for Reconsideration-In-Intervention are denied for the rules cannot be relaxed to await litigants who sleep on their rights. In any event, a sideglance at these late motions will show that they hoist no novel arguments.

c. Failure to Implead an Indispensable Party

PIATCO next contends that petitioners should have impleaded the Republic of the Philippines as an indispensable party. It alleges that petitioners sued the DOTC, MIAA and the DPWH in their own capacities or as implementors of the PIATCO Contracts and not as a contract party or as representatives of the Government of the Republic of the Philippines. It then leapfrogs to the conclusion that the "absence of an indispensable party renders ineffectual all the proceedings subsequent to the filing of the complaint including the judgment."18

PIATCO’s allegations are inaccurate. The petitions clearly bear out that public respondents DOTC and MIAA were impleaded as parties to the PIATCO Contracts and not merely as their implementors. The separate petitions filed by the MIAA employees19 and members of the House of Representatives20 alleged that "public respondents are impleaded herein because they either executed the PIATCO Contracts or are undertaking acts which are related to the PIATCO Contracts. They are interested and indispensable parties to this Petition."21 Thus, public respondents DOTC and MIAA were impleaded as parties to the case for having executed the contracts.

More importantly, it is also too late in the day for PIATCO to raise this issue. If PIATCO seriously views the non-inclusion of the Republic of the Philippines as an indispensable party as fatal to the petitions at bar, it should have raised the issue at the onset of the proceedings as a ground to dismiss. PIATCO cannot litigate issues on a piecemeal basis, otherwise, litigations shall be like a shore that knows no end. In any event, the Solicitor General, the legal counsel of the Republic, appeared in the cases at bar in representation of the interest of the government.

IIPre-qualification of PIATCO

The Implementing Rules provide for the unyielding standards the PBAC should apply to determine the financial capability of a bidder for pre-qualification purposes: (i) proof of the ability of the project proponent and/or the consortium to provide a minimum amount of equity to the project and (ii) a letter testimonial from reputable banks attesting that the project proponent and/or members of the consortium are banking with them, that they are in good financial standing, and that they have adequate resources.22 The evident intent of these standards is to protect the integrity and insure the viability of the project by seeing to it that the proponent has the financial capability to carry it out. As a

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further measure to achieve this intent, it maintains a certain debt-to-equity ratio for the project.

At the pre-qualification stage, it is most important for a bidder to show that it has the financial capacity to undertake the project by proving that it can fulfill the requirement on minimum amount of equity. For this purpose, the Bid Documents require in no uncertain terms:

The minimum amount of equity to which the proponent’s financial capability will be based shall be thirty percent (30%) of the project cost instead of the twenty percent (20%) specified in Section 3.6.4 of the Bid Documents. This is to correlate with the required debt-to-equity ratio of 70:30 in Section 2.01a of the draft concession agreement. The debt portion of the project financing should not exceed 70% of the actual project cost.23

In relation thereto, section 2.01 (a) of the ARCA provides:

Section 2.01 Project Scope.

The scope of the project shall include:

(a) Financing the project at an actual Project cost of not less than Three Hundred Fifty Million United States Dollars (US$350,000,000.00) while maintaining a debt-to-equity ratio of 70:30, provided that if the actual Project costs should exceed the aforesaid amount, Concessionaire shall ensure that the debt-to-equity ratio is maintained;24

Under the debt-to-equity restriction, a bidder may only seek financing of the NAIA IPT III Project up to 70% of the project cost. Thirty percent (30%) of the cost must come in the form of equity or investment by the bidder itself. It cannot be overly emphasized that the rules require a minimum amount of equity to ensure that a bidder is not merely an operator or implementor of the project but an investor with a substantial interest in its success. The minimum equity requirement also guarantees the Philippine government and the general public, who are the ultimate beneficiaries of the project, that a bidder will not be indifferent to the completion of the project. The discontinuance of the project will irreparably damage public interest more than private interest.

In the cases at bar, after applying the investment ceilings provided under the General Banking Act and considering the maximum amounts that each member of the consortium may validly invest in

the project, it is daylight clear that the Paircargo Consortium, at the time of pre-qualification, had a net worth equivalent to only6.08% of the total estimated project cost.25 By any reckoning, a showing by a bidder that at the time of pre-qualification its maximum funds available for investment amount to only 6.08% of the project cost is insufficient to satisfy the requirement prescribed by the Implementing Rules that the project proponent must have the ability to provide at least 30% of the total estimated project cost. In peso and centavo terms, at the time of pre-qualification, the Paircargo Consortium had maximum funds available for investment to the NAIA IPT III Project only in the amount of P558,384,871.55, when it had to show that it had the ability to provide at least P2,755,095,000.00. The huge disparity cannot be dismissed as of de minimis importance considering the high public interest at stake in the project.

PIATCO nimbly tries to sidestep its failure by alleging that it submitted not only audited financial statements but also testimonial letters from reputable banks attesting to the good financial standing of the Paircargo Consortium. It contends that in adjudging whether the Paircargo Consortium is a pre-qualified bidder, the PBAC should have considered not only its financial statements but other factors showing its financial capability.

Anent this argument, the guidelines provided in the Bid Documents are instructive:

3.3.4 FINANCING AND FINANCIAL PREQUALIFICATIONS REQUIREMENTS

· Minimum Amount of Equity

Each member of the proponent entity is to provide evidence of networth in cash and assets representing the proportionate share in the proponent entity. Audited financial statements for the past five (5) years as a company for each member are to be provided.

· Project Loan Financing

Testimonial letters from reputable banks attesting that each of the members of the ownership entity are banking with them, in good financial standing and having adequate resources are to be provided.26

It is beyond refutation that Paircargo Consortium failed to prove its ability to provide the amount of at least P2,755,095,000.00, or 30% of the estimated project cost. Its submission of

testimonial letters attesting to its good financial standing will not cure this failure. At best, the said letters merely establish its credit worthiness or its ability to obtain loans to finance the project. They do not, however, prove compliance with the aforesaid requirement of minimum amount of equity in relation to the prescribed debt-to-equity ratio. This equity cannot be satisfied through possible loans.

In sum, we again hold that given the glaring gap between the net worth of Paircargo and PAGS combined with the amount of maximum funds that Security Bank may invest by equity in a non-allied undertaking, Paircargo Consortium, at the time of pre-qualification, failed to show that it had the ability to provide 30% of the project cost and necessarily, its financial capability for the project cannot pass muster.

IIIConcession Agreement

Again, we brightline the principle that in public bidding, bids are submitted in accord with the prescribed terms, conditions and parameters laid down by government and pursuant to the requirements of the project bidded upon. In light of these parameters, bidders formulate competing proposals which are evaluated to determine the bid most favorable to the government. Once the contract based on the bid most favorable to the government is awarded, all that is left to be done by the parties is to execute the necessary agreements and implement them. There can be no substantial or material change to the parameters of the project, including the essential terms and conditions of the contract bidded upon, after the contract award. If there were changes and the contracts end up unfavorable to government, the public bidding becomes a mockery and the modified contracts must be struck down.

Respondents insist that there were no substantial or material amendments in the 1997 Concession Agreement as to the technical aspects of the project, i.e., engineering design, technical soundness, operational and maintenance methods and procedures of the project or the technical proposal of PIATCO. Further, they maintain that there was no modification of the financial features of the project, i.e., minimum project cost, debt-to-equity ratio, the operations and maintenance budget, the schedule and amount of annual guaranteed payments, or the financial proposal of PIATCO. A discussion of some of these changes to determine whether they altered the terms and conditions upon which the bids were made is again in order.

a. Modification on Fees and Charges to be collected by PIATCO

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PIATCO clings to the contention that the removal of the groundhandling fees, airline office rentals and porterage fees from the category of fees subject to MIAA regulation in the 1997 Concession Agreement does not constitute a substantial amendment as these fees are not really public utility fees. In other words, PIATCO justifies the re-classification under the 1997 Concession Agreement on the ground that these fees are non-public utility revenues.

We disagree. The removal of groundhandling fees, airline office rentals and porterage fees from the category of "Public Utility Revenues" under the draft Concession Agreement and its re-classification to "Non-Public Utility Revenues" under the 1997 Concession Agreement is significant and has far reaching consequence. The 1997 Concession Agreement provides that with respect to Non-Public Utility Revenues, which include groundhandling fees, airline office rentals and porterage fees,27 "[PIATCO] may make any adjustments it deems appropriatewithout need for the consent of GRP or any government agency."28 In contrast, the draft Concession Agreement specifies these fees as part of Public Utility Revenues and can be adjusted "only once every two years and in accordance with the Parametric Formula" and "the adjustments shall be made effective only after the written express approval of the MIAA."29 The Bid Documents themselves clearly provide:

4.2.3 Mechanism for Adjustment of Fees and Charges

4.2.3.1 Periodic Adjustment in Fees and Charges

Adjustments in the fees and charges enumerated hereunder, whether or not falling within the purview of public utility revenues, shall be allowed only once every two years in accordance with the parametric formula attached hereto as Annex 4.2f. Provided that the adjustments shall be made effective only after the written express approval of MIAA. Provided, further, that MIAA’s approval, shall be contingent only on conformity of the adjustments to the said parametric formula. …

The fees and charges to be regulated in the above manner shall consist of the following:

. . . .

c) groundhandling fees;

d) rentals on airline offices;

. . . .

(f) porterage fees;

. . . .30

The plain purpose in re-classifying groundhandling fees, airline office rentals and porterage fees as non-public utility fees is to remove them from regulation by the MIAA. In excluding these fees from government regulation, the danger to public interest cannot be downplayed.

We are not impressed by the effort of PIATCO to depress this prejudice to public interest by its contention that in the 1997 Concession Agreement governing Non-Public Utility Revenues, it is provided that "[PIATCO] shall at all times be judicious in fixing fees and charges constituting Non-Public Utility Revenues in order to ensure that End Users are not unreasonably deprived of services."31 PIATCO then peddles the proposition that the said provision confers upon MIAA "full regulatory powers to ensure that PIATCO is charging non-public utility revenues atjudicious rates."32 To the trained eye, the argument will not fly for it is obviously non sequitur. Fairly read, it is PIATCO that wields the power to determine the judiciousness of the said fees and charges. In the draft Concession Agreement the power was expressly lodged with the MIAA and any adjustment can only be done once every two years. The changes are not insignificant specks as interpreted by PIATCO.

PIATCO further argues that there is no substantial change in the 1997 Concession Agreement with respect to fees and charges PIATCO is allowed to impose which are not covered by Administrative Order No. 1, Series of 199333 as the "relevant provision of the 1997 Concession Agreement is practically identical with the draft Concession Agreement."34

We are not persuaded. Under the draft Concession Agreement, PIATCO may impose fees and charges other than those fees and charges previously imposed or collected at the Ninoy Aquino International Airport Passenger Terminal I, subject to the written approval of MIAA.35 Further, the draft Concession Agreement provides that MIAA reserves the right to regulate these new fees and charges if in its judgment the users of the airport shall be deprived of a free option for the services they cover.36 In contrast, under the 1997 Concession Agreement,the MIAA merely retained the right to approve any imposition of new fees and charges which were not previously collected at the Ninoy Aquino

International Airport Passenger Terminal I. The agreement did not contain an equivalent provision allowing MIAA to reserve the right to regulate the adjustments of these new fees and charges.37 PIATCO justifies the amendment by arguing that MIAA can establish terms before approval of new fees and charges, inclusive of the mode for their adjustment.

PIATCO’s stance is again a strained one. There would have been no need for an amendment if there were no change in the power to regulate on the part of MIAA. The deletion of MIAA’s reservation of its right to regulate the price adjustments of new fees and charges can have no other purpose but to dilute the extent of MIAA’s regulation in the collection of these fees. Again, the amendment diminished the authority of MIAA to protect the public interest in case of abuse by PIATCO.

b. Assumption by the Government of the liabilities of PIATCO in the event of the latter’s default

PIATCO posits the thesis that the new provisions in the 1997 Concession Agreement in case of default by PIATCO on its loans were merely meant to prescribe and limit the rights of PIATCO’s creditors with regard to the NAIA Terminal III. PIATCO alleges that Section 4.04 of the 1997 Concession Agreement simply provides that PIATCO’s creditors have no right to foreclose the NAIA Terminal III.

We cannot concur. The pertinent provisions of the 1997 Concession Agreement state:

Section 4.04 Assignment.

. . . .

(b) In the event Concessionaire should default in the payment of an Attendant Liability, and the default has resulted in the acceleration of the payment due date of the Attendant Liability prior to its stated date of maturity, the Unpaid Creditors and Concessionaire shall immediately inform GRP in writing of such default. GRP shall, within one hundred eighty (180) Days from receipt of the joint written notice of the Unpaid Creditors and Concessionaire, either (i) take over the Development Facility and assume the Attendant Liabilities, or (ii) allow the Unpaid Creditors, if qualified, to be substituted as concessionaire and operator of the Development Facility in accordance with the terms and conditions hereof, or designate a qualified operator acceptable to GRP to operate the Development Facility, likewise under

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the terms and conditions of this Agreement; Provided that if at the end of the 180-day period GRP shall not have served the Unpaid Creditors and Concessionaire written notice of its choice, GRP shall be deemed to have elected to take over the Development Facility with the concomitant assumption of Attendant Liabilities.

(c) If GRP should, by written notice, allow the Unpaid Creditors to be substituted as concessionaire, the latter shall form and organize a concession company qualified to take over the operation of the Development Facility. If the concession company should elect to designate an operator for the Development Facility, the concession company shall in good faith identify and designate a qualified operator acceptable to GRP within one hundred eighty (180) days from receipt of GRP’s written notice. If the concession company, acting in good faith and with due diligence, is unable to designate a qualified operator within the aforesaid period, then GRP shall at the end of the 180-day period take over the Development Facility and assume Attendant Liabilities.

A plain reading of the above provision shows that it spells out in limpid language the obligation of government in case of default by PIATCO on its loans. There can be no blinking from the fact that in case of PIATCO’s default, the government will assume PIATCO’s Attendant Liabilities as defined in the 1997 Concession Agreement.38 This obligation is not found in the draft Concession Agreement and the change runs roughshod to the spirit and policy of the BOT Law which was crafted precisely to prevent government from incurring financial risk.

In any event, PIATCO pleads that the entire agreement should not be struck down as the 1997 Concession Agreement contains a separability clause.

The plea is bereft of merit. The contracts at bar which made a mockery of the bidding process cannot be upheld and must be annulled in their entirety for violating law and public policy. As demonstrated, the contracts were substantially amended after their award to the successful bidder on terms more beneficial to PIATCO and prejudicial to public interest. If this flawed process would be allowed, public bidding will cease to be competitive and worse, government would not be favored with the best bid. Bidders will no longer bid on the basis of the prescribed terms and conditions in the bid documents but will formulate their bid in anticipation of the execution of a future contract containing new and better terms and conditions that were not previously available at the time of the bidding. Such a public bidding will not inure to

the public good. The resulting contracts cannot be given half a life but must be struck down as totally lawless.

IV.Direct Government Guarantee

The respondents further contend that the PIATCO Contracts do not contain direct government guarantee provisions. They assert that section 4.04 of the ARCA, which superseded sections 4.04(b) and (c), Article IV of the 1997 Concession Agreement, is but a "clarification and explanation"39 of the securities allowed in the bid documents. They allege that these provisions merely provide for "compensation to PIATCO"40 in case of a government buy-out or takeover of NAIA IPT III. The respondents, particularly respondent PIATCO, also maintain that the guarantee contained in the contracts, if any, is an indirect guarantee allowed under the BOT Law, as amended.41

We do not agree. Section 4.04(c), Article IV42 of the ARCA should be read in conjunction with section 1.06, Article I,43 in the same manner that sections 4.04(b) and (c), Article IV of the 1997 Concession Agreement should be related to Article 1.06 of the same contract. Section 1.06, Article I of the ARCA and its counterpart provision in the 1997 Concession Agreement define in no uncertain terms the meaning of "attendant liabilities." They tell us of the amounts that the Government has to pay in the event respondent PIATCO defaults in its loan payments to its Senior Lenders and no qualified transferee or nominee is chosen by the Senior Lenders or is willing to take over from respondent PIATCO.

A reasonable reading of all these relevant provisions would reveal that the ARCA made the Government liable to pay "all amounts ... from time to time owed or which may become owing by Concessionaire [PIATCO] to Senior Lenders or any other persons or entities who have provided, loaned, or advanced funds or provided financial facilities to Concessionaire [PIATCO] for the Project [NAIA Terminal 3]."44 These amounts include "without limitation, all principal, interest, associated fees, charges, reimbursements, and other related expenses... whether payable at maturity, by acceleration or otherwise."45 They further include amounts owed by respondent PIATCO to its "professional consultants and advisers, suppliers, contractors and sub-contractors" as well as "fees, charges and expenses of any agents or trustees" of the Senior Lenders or any other persons or entities who have provided loans or financial facilities to respondent PIATCO in relation to NAIA IPT III.46 The counterpart provision in the 1997 Concession Agreement specifying the attendant liabilities that the Government would be obligated to pay should PIATCO default in its loan obligations is equally onerous to the Government as those

contained in the ARCA. According to the 1997 Concession Agreement, in the event the Government is forced to prematurely take over NAIA IPT III as a result of respondent PIATCO’s default in the payment of its loan obligations to its Senior Lenders, it would be liable to pay the following amounts as "attendant liabilities":

Section 1.06. Attendant Liabilities

Attendant Liabilities refer to all amounts recorded and from time to time outstanding in the books of the Concessionaire as owing to Unpaid Creditors who have provided, loaned or advanced funds actually used for the Project, including all interests, penalties, associated fees, charges, surcharges, indemnities, reimbursements and other related expenses, and further including amounts owed by Concessionaire to its suppliers, contractors and sub-contractors.47

These provisions reject respondents’ contention that what the Government is obligated to pay, in the event that respondent PIATCO defaults in the payment of its loans, is merely termination payment or just compensation for its takeover of NAIA IPT III. It is clear from said section 1.06 that what the Government would pay is the sum total of all the debts, including all interest, fees and charges, that respondent PIATCO incurred in pursuance of the NAIA IPT III Project. This reading is consistent with section 4.04 of the ARCA itself which states that the Government "shall make a termination payment to Concessionaire [PIATCO] equal to the Appraised Value (as hereinafter defined) of the Development Facility [NAIA Terminal III] or the sum of the Attendant Liabilities, if greater." For sure, respondent PIATCO will not receive any amount less than sufficient to cover its debts, regardless of whether or not the value of NAIA IPT III, at the time of its turn over to the Government, may actually be less than the amount of PIATCO’s debts. The scheme is a form of direct government guarantee for it is undeniable that it leaves the government no option but to pay the "attendant liabilities" in the event that the Senior Lenders are unable or unwilling to appoint a qualified nominee or transferee as a result of PIATCO’s default in the payment of its Senior Loans. As we stressed in our Decision, this Court cannot depart from the legal maxim that "those that cannot be done directly cannot be done indirectly."

This is not to hold, however, that indirect government guarantee is not allowed under the BOT Law, as amended. The intention to permit indirect government guarantee is evident from the Senate deliberations on the amendments to the BOT Law. The idea is to allow for reasonable government undertakings, such as to

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authorize the project proponent to undertake related ventures within the project area, in order to encourage private sector participation in development projects.48 An example cited by then Senator Gloria Macapagal-Arroyo, one of the sponsors of R.A. No. 7718, is the Mandaluyong public market which was built under the Build-and-Transfer ("BT") scheme wherein instead of the government paying for the transfer, the project proponent was allowed to operate the upper floors of the structure as a commercial mall in order to recoup their investments.49 It was repeatedly stressed in the deliberations that in allowing indirect government guarantee, the law seeks to encourage both the government and the private sector to formulate reasonable and innovative government undertakings in pursuance of BOT projects. In no way, however, can the government be made liable for the debts of the project proponent as this would be tantamount to a direct government guarantee which is prohibited by the law. Such liability would defeat the very purpose of the BOT Law which is to encourage the use of private sector resources in the construction, maintenance and/or operation of development projects with no, or at least minimal, capital outlay on the part of the government.

The respondents again urge that should this Court affirm its ruling that the PIATCO Contracts contain direct government guarantee provisions, the whole contract should not be nullified. They rely on the separability clause in the PIATCO Contracts.

We are not persuaded.

The BOT Law and its implementing rules provide that there are three (3) essential requisites for an unsolicited proposal to be accepted: (1) the project involves a new concept in technology and/or is not part of the list of priority projects, (2) no direct government guarantee, subsidy or equity is required, and (3) the government agency or local government unit has invited by publication other interested parties to a public bidding and conducted the same.50 The failure to fulfill any of the requisites will result in the denial of the proposal. Indeed, it is further provided that a direct government guarantee, subsidy or equity provision will "necessarily disqualify a proposal from being treated and accepted as an unsolicited proposal."51 In fine, the mere inclusion of a direct government guarantee in an unsolicited proposal is fatal to the proposal. There is more reason to invalidate a contract if a direct government guarantee provision is inserted later in the contract via a backdoor amendment. Such an amendment constitutes a crass circumvention of the BOT Law and renders the entire contract void.

Respondent PIATCO likewise claims that in view of the fact that other BOT contracts such as the JANCOM contract, the Manila

Water contract and the MRT contract had been considered valid, the PIATCO contracts should be held valid as well.52 There is no parity in the cited cases. For instance, a reading of Metropolitan Manila Development Authority v. JANCOM Environmental Corporation53 will show that its issue is different from the issues in the cases at bar. In the JANCOM case, the main issue is whether there is a perfected contract between JANCOM and the Government. The resolution of the issue hinged on the following: (1) whether the conditions precedent to the perfection of the contract were complied with; (2) whether there is a valid notice of award; and (3) whether the signature of the Secretary of the Department of Environment and Natural Resources is sufficient to bind the Government. These issue and sub-issues are clearly distinguishable and different. For one, the issue of direct government guarantee was not considered by this Court when it held the JANCOM contract valid, yet, it is a key reason for invalidating the PIATCO Contracts. It is a basic principle in law that cases with dissimilar facts cannot have similar disposition.

This Court, however, is not unmindful of the reality that the structures comprising the NAIA IPT III facility are almost complete and that funds have been spent by PIATCO in their construction. For the government to take over the said facility, it has to compensate respondent PIATCO as builder of the said structures. The compensation must be just and in accordance with law and equity for the government can not unjustly enrich itself at the expense of PIATCO and its investors.

II.Temporary takeover of business affected with public interest

in times of national emergency

Section 17, Article XII of the 1987 Constitution grants the State in times of national emergency the right to temporarily take over the operation of any business affected with public interest. This right is an exercise of police power which is one of the inherent powers of the State.

Police power has been defined as the "state authority to enact legislation that may interfere with personal liberty or property in order to promote the general welfare."54 It consists of two essential elements. First, it is an imposition of restraint upon liberty or property. Second, the power is exercised for the benefit of the common good. Its definition in elastic terms underscores its all-encompassing and comprehensive embrace.55 It is and still is the "most essential, insistent, and illimitable"56 of the State’s powers. It is familiar knowledge that unlike the power of eminent domain, police power is exercised without provision for just compensation for its paramount consideration is public welfare.57

It is also settled that public interest on the occasion of a national emergency is the primary consideration when the government decides to temporarily take over or direct the operation of a public utility or a business affected with public interest. The nature and extent of the emergency is the measure of the duration of the takeover as well as the terms thereof. It is the State that prescribes such reasonable terms which will guide the implementation of the temporary takeover as dictated by the exigencies of the time. As we ruled in our Decision, this power of the State can not be negated by any party nor should its exercise be a source of obligation for the State.

Section 5.10(c), Article V of the ARCA provides that respondent PIATCO "shall be entitled to reasonable compensation for the duration of the temporary takeover by GRP, which compensation shall take into account the reasonable cost for the use of the Terminal and/or Terminal Complex."58 It clearly obligates the government in the exercise of its police power to compensate respondent PIATCO and this obligation is offensive to the Constitution. Police power can not be diminished, let alone defeated by any contract for its paramount consideration is public welfare and interest.59

Again, respondent PIATCO’s reliance on the case of Heirs of Suguitan v. City of Mandaluyong60 to justify its claim for reasonable compensation for the Government’s temporary takeover of NAIA IPT III in times of national emergency is erroneous. What was involved in Heirs of Suguitan is the exercise of the state’s power of eminent domain and not of police power, hence, just compensation was awarded. The cases at bar will not involve the exercise of the power of eminent domain.

III.Monopoly

Section 19, Article XII of the 1987 Constitution mandates that the State prohibit or regulate monopolies when public interest so requires. Monopolies are not per se prohibited. Given its susceptibility to abuse, however, the State has the bounden duty to regulate monopolies to protect public interest. Such regulation may be called for, especially in sensitive areas such as the operation of the country’s premier international airport, considering the public interest at stake.

By virtue of the PIATCO contracts, NAIA IPT III would be the only international passenger airport operating in the Island of Luzon, with the exception of those already operating in Subic Bay Freeport Special Economic Zone ("SBFSEZ"), Clark Special Economic Zone ("CSEZ") and in Laoag City. Undeniably, the contracts would create a monopoly in the operation of an

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international commercial passenger airport at the NAIA in favor of PIATCO.

The grant to respondent PIATCO of the exclusive right to operate NAIA IPT III should not exempt it from regulation by the government. The government has the right, indeed the duty, to protect the interest of the public. Part of this duty is to assure that respondent PIATCO’s exercise of its right does not violate the legal rights of third parties. We reiterate our ruling that while the service providers presently operating at NAIA Terminals I and II do not have the right to demand for the renewal or extension of their contracts to continue their services in NAIA IPT III, those who have subsisting contracts beyond the In-Service Date of NAIA IPT III can not be arbitrarily or unreasonably treated.

Finally, the Respondent Congressmen assert that at least two (2) committee reports by the House of Representatives found the PIATCO contracts valid and contend that this Court, by taking cognizance of the cases at bar, reviewed an action of a co-equal body.61 They insist that the Court must respect the findings of the said committees of the House of Representatives.62 With due respect, we cannot subscribe to their submission. There is a fundamental difference between a case in court and an investigation of a congressional committee. The purpose of a judicial proceeding is to settle the dispute in controversy by adjudicating the legal rights and obligations of the parties to the case. On the other hand, a congressional investigation is conducted in aid of legislation.63 Its aim is to assist and recommend to the legislature a possible action that the body may take with regard to a particular issue, specifically as to whether or not to enact a new law or amend an existing one. Consequently, this Court cannot treat the findings in a congressional committee report as binding because the facts elicited in congressional hearings are not subject to the rigors of the Rules of Court on admissibility of evidence. The Court in assuming jurisdiction over the petitions at bar simply performed its constitutional duty as the arbiter of legal disputes properly brought before it, especially in this instance when public interest requires nothing less.

WHEREFORE, the motions for reconsideration filed by the respondent PIATCO, respondent Congressmen and the respondents-in-intervention are DENIED with finality.

SO ORDERED.

Davide, Jr., C.J., Austria-Martinez, Corona, and Carpio-Morales, JJ., concur.Vitug, J., maintains his separate opinion in the main ponencia, promulgated on 05 May 2003.Panganiban, J., reiterate his separate opinion in the main case,

promulgated on May 5, 2003.Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, and Azcuna, JJ., joins J. Vitug’s opinion.Carpio, and Tinga, JJ., no part.Callejo, Sr., J., joins J. Panganiban in his concurring opinion

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G.R. No. 154599             January 21, 2004THE LIGA NG MGA BARANGAY NATIONAL, petitioner, vs.THE CITY MAYOR OF MANILA, HON. JOSE ATIENZA, JR., and THE CITY COUNCIL OF MANILA,respondents.

D E C I S I O N

DAVIDE, JR., C.J.:

This petition for certiorari under Rule 65 of the Rules of Court seeks the nullification of Manila City Ordinance No. 8039, Series of 2002,1 and respondent City Mayor’s Executive Order No. 011, Series of 2002,2 dated 15 August 2002 , for being patently contrary to law.

The antecedents are as follows:

Petitioner Liga ng mga Barangay National (Liga for brevity) is the national organization of all the barangays in the Philippines, which pursuant to Section 492 of Republic Act No. 7160, otherwise known as The Local Government Code of 1991, constitutes the duly elected presidents of highly-urbanized cities, provincial chapters, the metropolitan Manila Chapter, and metropolitan political subdivision chapters.

Section 493 of that law provides that "[t]he liga at the municipal, city, provincial, metropolitan political subdivision, and national levels directly elect a president, a vice-president, and five (5) members of the board of directors." All other matters not provided for in the law affecting the internal organization of the leagues of local government units shall be governed by their respective constitution and by-laws, which must always conform to the provisions of the Constitution and existing laws.3

On 16 March 2000, the Liga adopted and ratified its own Constitution and By-laws to govern its internal organization.4 Section 1, third paragraph, Article XI of said Constitution and By-Laws states:

All other election matters not covered in this Article shall be governed by the "Liga Election Code" or such other rules as may be promulgated by the National Liga Executive Board in conformity with the provisions of existing laws.

By virtue of the above-cited provision, the Liga adopted and ratified its own Election Code.5 Section 1.2, Article I of the Liga Election Code states:

1.2 Liga ng mga Barangay Provincial, Metropolitan, HUC/ICC Chapters. There shall be nationwide synchronized elections for the provincial, metropolitan, and HUC/ICC chapters to be held on the third Monday of the month immediately after the month when the synchronized elections in paragraph 1.1 above was held. The incumbent Liga chapter president concerned duly assisted by the proper government agency, office or department, e.g. Provincial/City/NCR/Regional Director, shall convene all the duly elected Component City/Municipal Chapter Presidents and all the current elected Punong Barangays (for HUC/ICC) of the respective chapters in any public place within its area of jurisdiction for the purpose of reorganizing and electing the officers and directors of the provincial, metropolitan or HUC/ICC Liga chapters. Said president duly assisted by the government officer aforementioned, shall notify, in writing, all the above concerned at least fifteen (15) days before the scheduled election meeting on the exact date, time, place and requirements of the said meeting.

The Liga thereafter came out with its Calendar of Activities and Guidelines in the Implementation of the Liga Election Code of 2002,6 setting on 21 October 2002 the synchronized elections for highly urbanized city chapters, such as the Liga Chapter of Manila, together with independent component city, provincial, and metropolitan chapters.lawphi1.net

On 28 June 2002, respondent City Council of Manila enacted Ordinance No. 8039, Series of 2002, providing, among other things, for the election of representatives of the District Chapters in the City Chapter of Manila and setting the elections for both chapters thirty days after the barangay elections. Section 3 (A) and (B) of the assailed ordinance read:

SEC. 3. Representation Chapters. — Every Barangay shall be represented in the said Liga Chapters … by the Punong Barangay…or, in his absence or incapacity, by the kagawad duly elected for the purpose among its members….

A. District Chapter

All elected Barangay Chairman in each District shall elect from among themselves the President, Vice-President and five (5) members of the Board….

B. City Chapter

The District Chapter representatives shall automatically become members of the Board and they shall elect from among themselves a President, Vice-President, Secretary, Treasurer, Auditor and create other positions as it may deem necessary for the management of the chapter.

The assailed ordinance was later transmitted to respondent City Mayor Jose L. Atienza, Jr., for his signature and approval.

On 16 July 2002, upon being informed that the ordinance had been forwarded to the Office of the City Mayor, still unnumbered and yet to be officially released, the Liga sent respondent Mayor of Manila a letter requesting him that said ordinance be vetoed considering that it encroached upon, or even assumed, the functions of the Liga through legislation, a function which was clearly beyond the ambit of the powers of the City Council.7

Respondent Mayor, however, signed and approved the assailed city ordinance and issued on 15 August 2002 Executive Order No. 011, Series of 2002, to implement the ordinance.

Hence, on 27 August 2002, the Liga filed the instant petition raising the following issues:

I

WHETHER OR NOT THE RESPONDENT CITY COUNCIL OF MANILA COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF OR IN EXCESS OF JURISDICTION, WHEN IT ENACTED CITY ORDINANCE NO. 8039 S. 2002 PURPOSELY TO GOVERN THE ELECTIONS OF THE MANILA CHAPTER OF THE LIGA NG MGA BARANGAYS AND WHICH PROVIDES A DIFFERENT MANNER OF ELECTING ITS OFFICERS, DESPITE THE FACT THAT SAID CHAPTER’S ELECTIONS, AND THE ELECTIONS OF ALL OTHER CHAPTERS OF THE LIGA NG MGA BARANGAYS FOR THAT MATTER, ARE BY LAW MANDATED TO BE GOVERNED BY THE LIGA CONSTITUTION AND BY-LAWS AND THE LIGA ELECTION CODE.

II

WHETHER OR NOT THE RESPONDENT CITY MAYOR OF MANILA COMMITTED GRAVE ABUSE OF DISCRETION

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AMOUNTING TO LACK OF OR IN EXCESS OF JURISDICTION WHEN HE ISSUED EXECUTIVE ORDER NO. 011 TO IMPLEMENT THE QUESTIONED CITY ORDINANCE NO. 8039 S. 2002.

In support of its petition, the Liga argues that City Ordinance No. 8039, Series of 2002, and Executive Order No. 011, Series of 2002, contradict the Liga Election Code and are therefore invalid. There exists neither rhyme nor reason, not to mention the absence of legal basis, for the Manila City Council to encroach upon, or even assume, the functions of the Liga by prescribing, through legislation, the manner of conducting the Liga elections other than what has been provided for by the Liga Constitution and By-laws and the Liga Election Code. Accordingly, the subject ordinance is an ultra vires act of the respondents and, as such, should be declared null and void.

As for its prayer for the issuance of a temporary restraining order, the petitioner cites as reason therefor the fact that under Section 5 of the assailed city ordinance, the Manila District Chapter elections would be held thirty days after the regular barangay elections. Hence, it argued that the issuance of a temporary restraining order and/or preliminary injunction would be imperative to prevent the implementation of the ordinance and executive order.

On 12 September 2002, Barangay Chairman Arnel Peña, in his capacity as a member of the Liga ng mga Barangay in the City Chapter of Manila, filed a Complaint in Intervention with Urgent Motion for the Issuance of Temporary Restraining Order and/or Preliminary Injunction.8 He supports the position of the Liga and prays for the declaration of the questioned ordinance and executive order, as well as the elections of the Liga ng mga Barangay pursuant thereto, to be null and void. The assailed ordinance prescribing for an "indirect manner of election" amended, in effect, the provisions of the Local Government Code of 1991, which provides for the election of the Liga officers at large. It also violated and curtailed the rights of the petitioner and intervenor, as well as the other 896 Barangay Chairmen in the City of Manila, to vote and be voted upon in a direct election.

On 25 October 2002, the Office of the Solicitor General (OSG) filed a Manifestation in lieu of Comment.9 It supports the petition of the Liga, arguing that the assailed city ordinance and executive order are clearly inconsistent with the express public policy enunciated in R.A. No. 7160. Local political subdivisions are able to legislate only by virtue of a valid delegation of legislative power from the national legislature. They are mere agents vested with what is called the power of subordinate legislation. Thus, the

enactments in question, which are local in origin, cannot prevail against the decree, which has the force and effect of law.

On the issue of non-observance by the petitioners of the hierarchy-of-courts rule, the OSG posits that technical rules of procedure should be relaxed in the instant petition. While Batas Pambansa Blg. 129, as amended, grants original jurisdiction over cases of this nature to the Regional Trial Court (RTC), the exigency of the present petition, however, calls for the relaxation of this rule. Section 496 (should be Section 491) of the Local Government Code of 1991 primarily intended that the Liga ng mga Barangay determine the representation of the Liga in the sanggunians for the immediate ventilation, articulation, and crystallization of issues affecting barangay government administration. Thus, the immediate resolution of this petition is a must.

On the other hand, the respondents defend the validity of the assailed ordinance and executive order and pray for the dismissal of the present petition on the following grounds: (1) certiorari under Rule 65 of the Rules of Court is unavailing; (2) the petition should not be entertained by this Court in view of the pendency before the Regional Trial Court of Manila of two actions or petitions questioning the subject ordinance and executive order; (3) the petitioner is guilty of forum shopping; and (4) the act sought to be enjoined is fait accompli.

The respondents maintain that certiorari is an extraordinary remedy available to one aggrieved by the decision of a tribunal, officer, or board exercising judicial or quasi-judicial functions. The City Council and City Mayor of Manila are not the "board" and "officer" contemplated in Rule 65 of the Rules of Court because both do not exercise judicial functions. The enactment of the subject ordinance and issuance of the questioned executive order are legislative and executive functions, respectively, and thus, do not fall within the ambit of "judicial functions." They are both within the prerogatives, powers, and authority of the City Council and City Mayor of Manila, respectively. Furthermore, the petition failed to show with certainty that the respondents acted without or in excess of jurisdiction or with grave abuse of discretion.

The respondents also asseverate that the petitioner cannot claim that it has no other recourse in addressing its grievance other than this petition for certiorari. As a matter of fact, there are two cases pending before Branches 33 and 51 of the RTC of Manila (one is for mandamus; the other, for declaratory relief) and three in the Court of Appeals (one is for prohibition; the two other cases, for quo warranto), which are all akin to the present petition in the sense that the relief being sought therein is the declaration of the invalidity of the subject ordinance. Clearly, the petitioner may ask

the RTC or the Court of Appeals the relief being prayed for before this Court. Moreover, the petitioner failed to prove discernible compelling reasons attending the present petition that would warrant cognizance of the present petition by this Court.

Besides, according to the respondents, the petitioner has transgressed the proscription against forum-shopping in filing the instant suit. Although the parties in the other pending cases and in this petition are different individuals or entities, they represent the same interest.

With regard to petitioner's prayer for temporary restraining order and/ or preliminary injunction in its petition, the respondents maintain that the same had become moot and academic in view of the elections of officers of the City Liga ng mga Barangay on 15 September 2002 and their subsequent assumption to their respective offices.10Since the acts to be enjoined are now fait accompli, this petition for certiorari with an application for provisional remedies must necessarily fail. Thus, where the records show that during the pendency of the case certain events or circumstances had taken place that render the case moot and academic, the petition for certiorari must be dismissed.

After due deliberation on the pleadings filed, we resolve to dismiss this petition for certiorari.

First, the respondents neither acted in any judicial or quasi-judicial capacity nor arrogated unto themselves any judicial or quasi-judicial prerogatives. A petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure is a special civil action that may be invoked only against a tribunal, board, or officer exercising judicial or quasi-judicial functions.

Section 1, Rule 65 of the 1997 Rules of Civil Procedure provides:

SECTION 1. Petition for certiorari. — When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, or any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as law and justice may require.

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Elsewise stated, for a writ of certiorari to issue, the following requisites must concur: (1) it must be directed against a tribunal, board, or officer exercising judicial or quasi-judicial functions; (2) the tribunal, board, or officer must have acted without or in excess of jurisdiction or with grave abuse of discretion amounting lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law.

A respondent is said to be exercising judicial function where he has the power to determine what the law is and what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties.11

Quasi-judicial function, on the other hand, is "a term which applies to the actions, discretion, etc., of public administrative officers or bodies … required to investigate facts or ascertain the existence of facts, hold hearings, and draw conclusions from them as a basis for their official action and to exercise discretion of a judicial nature."12

Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is necessary that there be a law that gives rise to some specific rights of persons or property under which adverse claims to such rights are made, and the controversy ensuing therefrom is brought before a tribunal, board, or officer clothed with power and authority to determine the law and adjudicate the respective rights of the contending parties.13

The respondents do not fall within the ambit of tribunal, board, or officer exercising judicial or quasi-judicial functions. As correctly pointed out by the respondents, the enactment by the City Council of Manila of the assailed ordinance and the issuance by respondent Mayor of the questioned executive order were done in the exercise of legislative and executive functions, respectively, and not of judicial or quasi-judicial functions. On this score alone, certiorari will not lie.

Second, although the instant petition is styled as a petition for certiorari, in essence, it seeks the declaration by this Court of the unconstitutionality or illegality of the questioned ordinance and executive order. It, thus, partakes of the nature of a petition for declaratory relief over which this Court has only appellate, not original, jurisdiction.14Section 5, Article VIII of the Constitution provides:

Sec. 5. The Supreme Court shall have the following powers:

(1) Exercise original jurisdiction over cases affecting ambassadors, other public ministers and consuls, and over petitions for certiorari, prohibition, mandamus, quo warranto, and habeas corpus.

(2) Review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts in:

(a) All cases in which the constitutionality or validity of any treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in question. (Italics supplied).

As such, this petition must necessary fail, as this Court does not have original jurisdiction over a petition for declaratory relief even if only questions of law are involved.15

Third, even granting arguendo that the present petition is ripe for the extraordinary writ of certiorari, there is here a clear disregard of the hierarchy of courts. No special and important reason or exceptional and compelling circumstance has been adduced by the petitioner or the intervenor why direct recourse to this Court should be allowed.

We have held that this Court’s original jurisdiction to issue a writ of certiorari (as well as of prohibition, mandamus,quo warranto, habeas corpus and injunction) is not exclusive, but is concurrent with the Regional Trial Courts and the Court of Appeals in certain cases. As aptly stated in People v. Cuaresma:16

This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor0 will be directed. There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard of that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Court’s

original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. This is [an] established policy. It is a policy necessary to prevent inordinate demands upon the Court’s time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further over-crowding of the Court’s docket.

As we have said in Santiago v. Vasquez,17 the propensity of litigants and lawyers to disregard the hierarchy of courts in our judicial system by seeking relief directly from this Court must be put to a halt for two reasons: (1) it would be an imposition upon the precious time of this Court; and (2) it would cause an inevitable and resultant delay, intended or otherwise, in the adjudication of cases, which in some instances had to be remanded or referred to the lower court as the proper forum under the rules of procedure, or as better equipped to resolve the issues because this Court is not a trier of facts.

Thus, we shall reaffirm the judicial policy that this Court will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and exceptional and compelling circumstances justify the availment of the extraordinary remedy of writ of certiorari, calling for the exercise of its primary jurisdiction.18

Petitioner’s reliance on Pimentel v. Aguirre19 is misplaced because the non-observance of the hierarchy-of-courts rule was not an issue therein. Besides, what was sought to be nullified in the petition for certiorari and prohibition therein was an act of the President of the Philippines, which would have greatly affected all local government units. We reiterated therein that when an act of the legislative department is seriously alleged to have infringed the Constitution, settling the controversy becomes the duty of this Court. The same is true when what is seriously alleged to be unconstitutional is an act of the President, who in our constitutional scheme is coequal with Congress.

We hesitate to rule that the petitioner and the intervenor are guilty of forum-shopping. Forum-shopping exists where the elements of litis pendentia are present or when a final judgment in one case will amount to res judicatain the other. For litis pendentia to exist, the following requisites must be present: (1) identity of parties, or at least such parties as are representing the same interests in both actions; (2) identity of rights asserted and reliefs prayed for, the reliefs being founded on the same facts; and (3) identity with respect to the two preceding particulars in the two cases, such that any judgment that may be rendered in the pending case,

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regardless of which party is successful, would amount to res judicata in the other case.20

In the instant petition, and as admitted by the respondents, the parties in this case and in the alleged other pending cases are different individuals or entities; thus, forum-shopping cannot be said to exist. Moreover, even assuming that those five petitions are indeed pending before the RTC of Manila and the Court of Appeals, we can only guess the causes of action and issues raised before those courts, considering that the respondents failed to furnish this Court with copies of the said petitions.

WHEREFORE, the petition is DISMISSED.

SO ORDERED.

Davide, Jr., C.J., Puno, Vitug, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.Panganiban, J., in the result.

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[G.R. No. 139791.  December 12, 2003]MANILA BANKERS LIFE INSURANCE

CORPORATION, petitioner, vs. EDDY NG KOK WEI, respondent.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

Before us is a petition for review on certiorari assailing the Decision[1] dated March 26, 1999 and Resolution[2] dated August 5, 1999 of the Court of Appeals in CA-G.R. CV No. 40504, entitled “Eddy Ng Kok Wei vs. Manila Bankers Life Insurance Corporation”.

The factual antecedents as borne by the records are:

Eddy Ng Kok Wei, respondent, is a Singaporean businessman who ventured into investing in the Philippines.  On November 29, 1988, respondent, in a Letter of Intent addressed to Manila Bankers Life Insurance Corporation, petitioner, expressed his intention to purchase a condominium unit at Valle Verde Terraces.

Subsequently or on December 5, 1988, respondent paid petitioner a reservation fee of P50,000.00 for the purchase of a 46-square meter condominium unit (Unit 703) valued atP860,922.00. On January 16, 1989, respondent paid 90% of the purchase price in the sum of P729,830.00.

Consequently, petitioner, through its President, Mr. Antonio G. Puyat, executed a Contract to Sell in favor of the respondent.  The contract expressly states that the subject condominium unit “shall substantially be completed and delivered” to the respondent “within fifteen (15) months” from February 8, 1989 or on May 8, 1990, and that “(S)hould there be no substantial completion and fail(ure) to deliver the unit on the date specified, a penalty of 1% of the total amount paid (by respondent) shall be charged against (petitioner)”.

Considering that the stipulated 15-month period was at hand, respondent returned to the Philippines sometime in April, 1990.

In a letter dated April 5, 1990, petitioner, through its Senior Assistant Vice-President, Mr. Mario G. Zavalla, informed respondent of the substantial completion of his condominium unit, however, due to various uncontrollable forces (such as coup d‘ etat attempts, typhoon and steel and cement shortage), the final turnover is reset to May 31, 1990.

Meanwhile, on July 5, 1990, upon receipt of petitioner’s notice of delivery dated May 31, 1990, respondent again flew back to Manila.  He found the unit still uninhabitable for lack of water and electric facilities.

Once more, petitioner issued another notice to move-in addressed to its building administrator advising the latter that respondent is scheduled to move in on August 22, 1990.

On October 5, 1990, respondent returned to the Philippines only to find that his condominium unit was still unlivable.  Exasperated, he was constrained to send petitioner a letter datedNovember 21, 1990 demanding payment for the damages he sustained.  But petitioner ignored such demand, prompting respondent to file with the Regional Trial Court, Branch 150,Makati City, a complaint against the former for specific performance and damages, docketed as Civil Case No. 90-3440.

Meanwhile, during the pendency of the case, respondent finally accepted the condominium unit and on April 12, 1991, occupied the same.  Thus, respondent’s cause of action has been limited to his claim for damages.

On December 18, 1992, the trial court rendered a Decision[3] finding the petitioner liable for payment of damages due to the delay in the performance of its obligation to the respondent.  The dispositive portion reads:

“WHEREFORE, judgment is hereby rendered in favor of plaintiff and against defendant, ordering Manila Bankers Life Insurance Corporation to pay plaintiff Eddy Ng Kok Wei the following:

1.       One percent (1%) of the total amount plaintiff paid defendant;2.       P100,000.00 as moral damages;3.       P50,000.00 as exemplary damages;4.       P25,000.00 by way of attorney’s fees; and Cost of suit.“SO ORDERED.”

On appeal, the Court of Appeals, in a Decision dated March 26, 1999, affirmed in toto the trial court’s award of damages in favor of the respondent.

Unsatisfied, petitioner filed a motion for reconsideration but was denied by the Appellate Court in a Resolution dated August 5, 1999.

Hence, this petition for review on certiorari.  Petitioner contends that the trial court has no jurisdiction over the instant case; and that the Court of Appeals erred in affirming the trial court’s finding that petitioner incurred unreasonable delay in the delivery of the condominium unit to respondent.

On petitioner’s contention that the trial court has no jurisdiction over the instant case, Section 1 (c) of Presidential Decree No. 1344, as amended, provides:

“SECTION 1. – In the exercise of its functions to regulate the real estate trade and business and in addition to its powers provided for in

Presidential Decree No. 957, the National Housing Authority [now Housing and Land Use Regulatory Board (HLURB)][4] shall have exclusive jurisdiction to hear and decide cases of the following nature:

x x x“C. Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lots or condominium units against the owner, developer, dealer, broker or salesman.

x x x.”

Pursuant to the above provisions, it is the HLURB which has jurisdiction over the instant case.  We have consistently held that complaints for specific performance with damages by a lot or condominium unit buyer against the owner or developer falls under the exclusive jurisdiction of the HLURB.[5]

While it may be true that the trial court is without jurisdiction over the case, petitioner’s active participation in the proceedings estopped it from assailing such lack of it.  We have held that it is an undesirable practice of a party participating in the proceedings and submitting its case for decision and then accepting the judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse.[6]

Here, petitioner failed to raise the question of jurisdiction before the trial court and the Appellate Court.  In effect, petitioner confirmed and ratified the trial court’s jurisdiction over this case.  Certainly, it is now in estoppel and can no longer question the trial court’s jurisdiction.

On petitioner’s claim that it did not incur delay, suffice it to say that this is a factual issue.  Time and again, we have ruled that “the factual findings of the trial court are given weight when supported by substantial evidence and carries more weight when affirmed by the Court of Appeals.”[7] Whether or not petitioner incurred delay and thus, liable to pay damages as a result thereof, are indeed factual questions.

The jurisdiction of this Court in a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, is limited to reviewing only errors of law, not of fact, unless the factual findings being assailed are not supported by evidence on record or the impugned judgment is based on a misapprehension of facts.[8] These exceptions are not present here.

WHEREFORE, the petition is DENIED.  The assailed Decision dated March 26, 1999 and Resolution dated August 5, 1999 of the Court of Appeals are hereby AFFIRMED IN TOTO. Costs against the petitioner. SO ORDERED. Vitug, (Chairman), Corona, and Carpio-Morales, JJ., concur.

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[A.M. No. MTJ-01-1370.  April 25, 2003]OFFICE OF THE COURT ADMINISTRATOR, complainant, vs.

JUDGE AGUSTIN T. SARDIDO, Municipal Trial Court of Koronadal, South Cotabato,respondent.

D E C I S I O NCARPIO, J.:

The Case

This is an administrative case against respondent Judge Agustin T. Sardido (“Judge Sardido”) formerly presiding judge of the Municipal Trial Court of Koronadal, South Cotabato, for gross ignorance of the law.  Judge Sardido issued an Order dated 20 October 1998 excluding Judge Braulio Hurtado, Jr. (“Judge Hurtado”) of the Regional Trial Court of Kabacan, North Cotabato as one of the accused in an Amended Information.[1] Judge Sardido ruled that Supreme Court Circular No. 3-89 requires that Judge Hurtado be dropped from the Amended Information and his case be forwarded to the Court.

The Facts

Private complainant Teresita Aguirre Magbanua accused Oscar Pagunsan and Danilo Ong of the crime of “Falsification by Private Individual and Use of Falsified Document.”[2] The Amended Information included Judge Hurtado.  The case, docketed as Criminal Case No. 14071, was raffled to Judge Sardido, then presiding judge of the Municipal Trial Court of Koronadal, South Cotabato (“MTC-Koronadal”).

In a Deed of Absolute Sale dated 8 August 1993, private complainant Magbanua and six other vendors allegedly sold two parcels of land, covered by TCT Nos. 47873 and 33633 and located at the commercial district of Koronadal, to Davao Realty Development Corporation, represented by accused Ong, with co-accused Pagunsan, as broker.   Judge Hurtado, who at that time was the Clerk of Court of RTC-Koronadal and ex-officio notary public, notarized the Deed of Absolute Sale.

However, private complainant Magbanua denies signing the Deed of Absolute Sale dated 8 August 1993 which states that the consideration for the sale was only P600,000.00. Private complainant asserts that what she and the other vendors signed was a Deed of Absolute Sale dated 6 August 1996 for a consideration of P16,000,000.00.  Under the terms of the sale, the vendee agreed to pay for the capital gains tax.  The consideration in the 8 August 1993 Deed of Absolute Sale was apparently

undervalued.  Subsequently, the Bureau of Internal Revenue assessed the vendors a deficiency capital gains tax of P1,023,375.00.

Judge Hurtado filed a motion praying that the criminal complaint against him be forwarded to the Supreme Court.  Judge Hurtado claimed  that Circular No. 3-89 dated 6 February 1989 requires “all cases involving justices and judges of the lower courts, whether or not such complaints deal with acts apparently unrelated to the discharge of their official functions, such as acts of immorality, estafa, crimes against persons and property, etc.” to be forwarded to the Supreme Court.   Judge Hurtado asserted that since the case against him is one involving a judge of a lower court, the same should be forwarded to the Supreme Court pursuant to Circular No. 3-89.

The Provincial Prosecutor opposed Judge Hurtado’s motion, arguing that the case against Judge Hurtado is not within the scope of Circular No. 3-89 since it is not an IBP-initiated case. Moreover, the offense charged was committed in 1993 when Judge Hurtado was still a clerk of court and ex-officio notary public.

On 20 October 1998, Judge Sardido issued an Order, the pertinent portions of which read:

The issue to be resolved in the instant case is, whether the case of Judge Hurtado, who is charged for acts committed prior to his appointment as an RTC Judge, falls within the purview of the afore-said Circular No. 3-89.

It is the humble submission of the Court that the case of Judge Hurtado, an RTC Judge of the Regional Trial Court of Kabacan, North Cotabato, falls within the meaning and intent of the said circular.

For reasons being, firstly, the said circular provides that all cases involving justices and judges of lower courts shall be forwarded to the Supreme Court for appropriate action, whether or not such complaints deal with acts apparently unrelated to the discharge of their official functions, and regardless of the nature of the crime, without any qualification whether the crime was committed before or during his tenure of office. Under the law on Legal Hermeneutics, if the law does not qualify we must not qualify. Secondly, it would sound, to the mind of the Court, awkward for a first level court to be trying an incumbent judge of a second level court.

For reasons afore-stated, this Court can not and shall not try this case as against Judge Hurtado, unless the Honorable Supreme Court would order otherwise.

Wherefore, the foregoing premises duly considered, the name of Judge Braulio L. Hurtado, Jr. is ordered excluded from the amended information and the case against him is ordered forwarded to the Honorable Supreme Court, pursuant to the afore-said Circular No. 3-89 of the Supreme Court, dated February 9, 1989.

Accordingly, Maxima S. Borja (“Borja”), Stenographer I and Acting Clerk of Court II of the MTC-Koronadal, South Cotabato, wrote a letter dated 21 July 1999 forwarding the criminal case against Judge Hurtado to the Court Administrator for appropriate action.

Then Court Administrator Alfredo L. Benipayo issued a Memorandum dated 25 October 2000 pointing out that Circular No. 3-89 refers only to administrative complaints filed with the IBP against justices and judges of lower courts.  The Circular does not apply to criminal cases filed before trial courts against such justices and judges.

Thus, in the Resolution of 6 December 2000, the Court directed that the letter of Acting Clerk of Court Borja be returned to the MTC-Koronadal together with the records of the criminal case.  The Court directed Judge Sardido to explain in writing why he should not be held liable for gross ignorance of the law for excluding Judge Hurtado from the Amended Information and for transmitting the records of Judge Hurtado’s case to the Court.

In his Explanation dated 26 January 2001, Judge Sardido reasoned out that he excluded Judge Hurtado because Circular No. 3-89 directs the IBP to “forward to the Supreme Court for appropriate action all cases involving justices and judges of lower courts x x x.”   Judge Sardido claims that the Circular likewise “applies to courts in cases involving justices or judges of the lower courts,” especially so in this case where “Judge Hurtado was charged with falsification of public document as a notary public while he was still the Clerk of Court of the Regional Trial Court of the 11th Judicial Region in Koronadal, South Cotabato.”

In the Resolution of 28 March 2001, the Court referred this case to the Office of the Court Administrator (“OCA”) for evaluation, report and recommendation.  On 10 July 2001, the OCA submitted a Memorandum recommending that this case be re-docketed as a regular administrative matter.      

Judge Sardido filed his Manifestation dated 20 September 2001 stating that he is submitting the case for decision based on the  pleadings and records already filed.  Judge Sardido insisted that he did “what he had done in all honesty and good faith.”

OCA’s Findings and Conclusions

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The OCA found that Judge Sardido erred in excluding Judge Hurtado as one of the accused in the Amended Information in Criminal Case No. 14071.  The OCA held that Circular No. 3-89, which is Judge Sardido’s basis in issuing the Order of 20 October 1998, refers to administrative complaints filed with the IBP against justices and judges of lower courts.  The Circular does not apply to criminal cases filed against justices and judges of lower courts.  The OCA recommended that a fine of P5,000.00 be imposed on Judge Sardido for gross ignorance of the law.

The Court’s Ruling

The Court issued Circular No. 3-89 in response to a letter dated 19 December 1988 by then IBP President Leon M. Garcia, seeking clarification of the Court’s En Banc Resolution of 29 November 1998 in RE: Letter of then Acting Presiding Justice Rodolfo A. Nocon[3] and Associate Justices Reynato Puno[4] and Alfredo Marigomen[5] of the Court of Appeals.

A certain Atty. Eduardo R. Balaoing had filed a complaint against  Court of Appeals Justices Nocon, Puno and Marigomen relating to a petition filed before their division.  In its En Banc Resolution of 29 November 1988, the Court required the IBP to refer to the Supreme Court for appropriate action the complaint[6] filed by Atty. Balaoing  with the IBP Commission on Bar Discipline.  The Court stated that the power to discipline justices and judges of the lower courts is within the Court’s exclusive power and authority as provided in Section 11, Article VII of the 1987 Constitution.[7] The Court Administrator publicized the En Banc Resolution of 29 November 1988 by issuing Circular No. 17 dated 20 December 1988.

The Court issued Circular No. 3-89 on 6 February 1989 clarifying the En Banc Resolution of 29 November 1988.   Circular No. 3-89 provides in part as follows:

(1) The IBP (Board of Governors and Commission on Bar Discipline) shall forward to the Supreme Court for appropriate action all cases involving justices and judges of lower courts, whether or not such complaints deal with acts apparently unrelated to the discharge of their official functions, such as acts of immorality, estafa, crimes against persons and property, etc.  x x x. (Emphasis supplied)

Circular No. 3-89 clarified the second paragraph, Section 1 of Rule 139-B of the Rules of Court which states that:

The IBP Board of Governors may, motu proprio or upon referral by the Supreme Court or by a Chapter Board of Officers, or at the instance of

any person, initiate and prosecute proper charges against erringattorneys including those in the government service. (Emphasis supplied).

As clarified, the phrase “attorneys  x x x in the government service” in Section 1 of Rule 139-B does not include justices of appellate courts and judges of lower courts who are not subject to the disciplining authority of the IBP.  All administrative cases against justices of appellate courts and judges of lower courts fall exclusively within the jurisdiction of the Supreme Court.

However, Rule 139-B refers to Disbarment and Discipline of Attorneys which is administrative and not criminal in nature. The cases referred to in Circular No. 3-89 are administrative cases for disbarment, suspension or discipline of attorneys, including justices of appellate courts and judges of the lower courts.   The Court has vested the IBP with the power to initiate and prosecute administrative cases against erring lawyers.[8]  However, under Circular No. 3-89, the Court has directed the IBP to refer to the Supreme Court for appropriate action all administrative cases filed with IBP against justices of appellate courts and judges of the lower courts.  As mandated by the Constitution, the Court exercises the exclusive power to discipline administratively justices of appellate courts and judges of lower courts.

Circular No. 3-89 does not refer to criminal cases against erring justices of appellate courts or judges of lower courts.  Trial courts retain jurisdiction over the criminal aspect of offenses committed by justices of appellate courts[9] and judges of lower courts.  This is clear from the Circular directing the IBP, and not the trial courts, to refer all administrative cases filed against justices of appellate courts and judges of lower courts to the Supreme Court.  The case filed against Judge Hurtado is not an administrative case filed with the IBP.  It is a criminal case filed with the trial court under its jurisdiction as prescribed by law.

The acts or omissions of a judge may well constitute at the same time both a criminal act and an administrative offense. Whether the criminal case against Judge Hurtado relates to an act committed before or after he became a judge is of no moment. Neither is it material that an MTC judge will be trying an RTC judge in the criminal case.  A criminal case against an attorney or judge is distinct and separate from an administrative case against him.  The dismissal of the criminal case does not warrant the dismissal of an administrative case arising from the same set of facts.  The quantum of evidence that is required in the latter is only preponderance of evidence, and not proof beyond reasonable doubt which  is required in criminal cases.[10] As held in Gatchalian Promotions Talents Pool, Inc. v. Naldoza:[11]

Administrative cases against lawyers belong to a class of their own. They are distinct from and they may proceed independently of civil and criminal cases.

The burden of proof for these types of cases differ.  In a criminal case, proof beyond reasonable doubt is necessary; in an administrative case for disbarment or suspension, ‘clearly preponderant evidence’ is all that is required. Thus, a criminal prosecution will not constitute a prejudicial question even if the same facts and circumstances are attendant in the administrative proceedings.

It should be emphasized that a finding of guilt in the criminal case will not necessarily result in a finding of liability in the administrative case. Conversely, respondent’s acquittal does not necessarily exculpate him administratively.  In the same vein, the trial court’s finding of civil liability against the respondent will not inexorably lead to a similar finding in the administrative action before this Court. Neither will a favorable disposition in the civil action absolve the administrative liability of the lawyer. The basic premise is that criminal and civil cases are altogether different from administrative matters, such that the disposition in the first two will not inevitably govern the third and vice versa.  For this reason, it would be well to remember the Court’s ruling in In re Almacen, which we quote:

“x x x Disciplinary proceedings against lawyers are sui generis.  Neither purely civil nor purely criminal, they do not involve a trial of an action or a suit, but are rather investigations by the Court into the conduct of one of its officers.  Not being intended to inflict punishment, [they are] in no sense a criminal prosecution.  Accordingly, there is neither a plaintiff nor a prosecutor therein.  [They] may be initiated by the Court motu proprio.  Public interest is [their] primary objective, and the real question for determination is whether or not the attorney is still a fit person to be allowed the privileges as such. Hence, in the exercise of its disciplinary powers, the Court merely calls upon a member of the Bar to account for his actuations as an officer of the Court with the end in view of preserving the purity of the legal profession and the proper and honest administration of justice by purging the profession of members who by their misconduct have prove[n] themselves no longer worthy to be entrusted with the duties and responsibilities pertaining to the office of an attorney.  x x x”

A judge is called upon to exhibit more than just a cursory acquaintance with statutes and procedural rules.  He must be conversant with basic legal principles and well-settled doctrines.  He should strive for excellence and seek the truth with passion.[12] Judge Sardido failed in this regard. He erred in excluding Judge Hurtado as one of the accused in the Amended Information and in forwarding the criminal case against Judge Hurtado to the Court.

One last point. This administrative case against Judge Sardido started before the amendment[13] of Rule 140 classifying gross ignorance of the law a serious offense punishable by a fine of more than P20,000.00 but not exceeding P40,000.00.  The amendment cannot apply retroactively to Judge Sardido’s

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case.  However, the fine of P5,000.00  recommended by the OCA is too light a penalty considering that this is not the first offense of Judge Sardido.

In RE: Hold Departure Order Issued by Judge Agustin T. Sardido,[14] the Court reprimanded Judge Sardido for issuing a hold-departure order contrary to Circular No. 39-97.   InCabilao v. Judge Sardido,[15]  the Court fined Judge Sardido P5,000.00 for gross ignorance of the law, grave abuse of discretion and gross misconduct.  The Court gave a stern warning to Judge Sardido that a commission of the same or similar act would be dealt with more severely.  In Almeron v. Judge Sardido,[16] the Court imposed on Judge Sardido a stiffer fine ofP10,000.00 for gross ignorance of the law.  He was again sternly warned that the commission of the same or similar act in the future would be dealt with more severely including, if warranted, his dismissal from the service.

In a more recent administrative case, Torcende v. Judge Sardido,[17] the Court found Judge Sardido again guilty of gross ignorance of the law and of gross misconduct. This time the Court dismissed Judge Sardido from the service with forfeiture of his retirement benefits, except accrued leave credits.  The dismissal was with prejudice to reemployment in any branch of the government or any of its agencies or instrumentalities, including government-owned and controlled corporations.

The records of the OCA further disclose that Judge Sardido has  other similar administrative complaints[18] still pending against him. Such an unflattering service record erodes the people’s faith and confidence in the judiciary.  It is the duty of every member of the bench to avoid any impression of impropriety to protect the image and integrity of the judiciary.[19]  The Court may still impose a fine on Judge Sardido in the instant case despite his dismissal from the service.

WHEREFORE, respondent Judge Agustin T. Sardido is FINED Ten Thousand Pesos (P10,000.00) for gross ignorance of the law. The fine may be deducted from his accrued leave credits.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, Ynares-Santiago, and Azcuna, JJ., concur.

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G.R. No. 151149             September 7, 2004GEORGE KATON, petitioner, vs.MANUEL PALANCA JR., LORENZO AGUSTIN, JESUS GAPILANGO and JUAN FRESNILLO, respondents.

D E C I S I O N

PANGANIBAN, J.:

Where prescription, lack of jurisdiction or failure to state a cause of action clearly appear from the complaint filed with the trial court, the action may be dismissed motu proprio by the Court of Appeals, even if the case has been elevated for review on different grounds. Verily, the dismissal of such cases appropriately ends useless litigations.

The Case

Before us is a Petition for Review1 under Rule 45 of the Rules of Court, assailing the December 8, 2000 Decision2and the November 20, 2001 Resolution3 of the Court of Appeals in CA-GR SP No. 57496. The assailed Decision disposed as follows:

"Assuming that petitioner is correct in saying that he has the exclusive right in applying for the patent over the land in question, it appears that his action is already barred by laches because he slept on his alleged right for almost 23 years from the time the original certificate of title has been issued to respondent Manuel Palanca, Jr., or after 35 years from the time the land was certified as agricultural land. In addition, the proper party in the annulment of patents or titles acquired through fraud is the State; thus, the petitioner’s action is deemed misplaced as he really does not have any right to assert or protect. What he had during the time he requested for the re-classification of the land was the privilege of applying for the patent over the same upon the land’s conversion from forest to agricultural.

"WHEREFORE, the petition is hereby DISMISSED. No pronouncement as to cost."4

The assailed Resolution, on the other hand, denied the Motion for Reconsideration filed by petitioner. It affirmed the RTC’s dismissal of his Complaint in Civil Case No. 3231, not on the grounds relied upon by the trial court, but because of prescription and lack of jurisdiction.

The Antecedent Facts

The CA narrates the antecedent facts as follows:

"On August 2, 1963, herein [P]etitioner [George Katon] filed a request with the District Office of the Bureau of Forestry in Puerto Princesa, Palawan, for the re-classification of a piece of real property known as Sombrero Island, located in Tagpait, Aborlan, Palawan, which consists of approximately 18 hectares. Said property is within Timberland Block of LC Project No. 10-C of Aborlan, Palawan, per BF Map LC No. 1582.

"Thereafter, the Bureau of Forestry District Office, Puerto Princesa, Palawan, ordered the inspection, investigation and survey of the land subject of the petitioner’s request for eventual conversion or re-classification from forest to agricultural land, and thereafter for George Katon to apply for a homestead patent.

"Gabriel Mandocdoc (now retired Land Classification Investigator) undertook the investigation, inspection and survey of the area in the presence of the petitioner, his brother Rodolfo Katon (deceased) and his cousin, [R]espondent Manuel Palanca, Jr. During said survey, there were no actual occupants on the island but there were some coconut trees claimed to have been planted by petitioner and [R]espondent Manuel Palanca, Jr. (alleged overseer of petitioner) who went to the island from time to time to undertake development work, like planting of additional coconut trees.

"The application for conversion of the whole Sombrero Island was favorably endorsed by the Forestry District Office of Puerto Princesa to its main office in Manila for appropriate action. The names of Felicisimo Corpuz, Clemente Magdayao and Jesus Gapilango and Juan Fresnillo were included in the endorsement as co-applicants of the petitioner.

"In a letter dated September 23, 1965, then Asst. Director of Forestry R.J.L. Utleg informed the Director of Lands, Manila, that since the subject land was no longer needed for forest purposes, the same is therefore certified and released as agricultural land for disposition under the Public Land Act.

"Petitioner contends that the whole area known as Sombrero Island had been classified from forest land to agricultural land and certified available for disposition upon his request and at his instance. However, Mr. Lucio Valera, then [l]and investigator of the District Land Office,

Puerto Princesa, Palawan, favorably endorsed the request of [R]espondents Manuel Palanca Jr. and Lorenzo Agustin, for authority to survey on November 15, 1965. On November 22, a second endorsement was issued by Palawan District Officer Diomedes De Guzman with specific instruction to survey vacant portions of Sombrero Island for the respondents consisting of five (5) hectares each. On December 10, 1965, Survey Authority No. R III-342-65 was issued authorizing Deputy Public Land Surveyor Eduardo Salvador to survey ten (10) hectares of Sombrero Island for the respondents. On December 23, 1990, [R]espondent Lorenzo Agustin filed a homestead patent application for a portion of the subject island consisting of an area of 4.3 hectares.

"Records show that on November 8, 1996, [R]espondent Juan Fresnillo filed a homestead patent application for a portion of the island comprising 8.5 hectares. Records also reveal that [R]espondent Jesus Gapilango filed a homestead application on June 8, 1972. Respondent Manuel Palanca, Jr. was issued Homestead Patent No. 145927 and OCT No. G-7089 on March 3, 19775 with an area of 6.84 hectares of Sombrero Island.

"Petitioner assails the validity of the homestead patents and original certificates of title covering certain portions of Sombrero Island issued in favor of respondents on the ground that the same were obtained through fraud. Petitioner prays for the reconveyance of the whole island in his favor.

"On the other hand, [R]espondent Manuel Palanca, Jr. claims that he himself requested for the reclassification of the island in dispute and that on or about the time of such request, [R]espondents Fresnillo, Palanca and Gapilango already occupied their respective areas and introduced numerous improvements. In addition, Palanca said that petitioner never filed any homestead application for the island. Respondents deny that Gabriel Mandocdoc undertook the inspection and survey of the island.

"According to Mandocdoc, the island was uninhabited but the respondents insist that they already had their respective occupancy and improvements on the island. Palanca denies that he is a mere overseer of the petitioner because he said he was acting for himself in developing his own area and not as anybody’s caretaker.

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"Respondents aver that they are all bona fide and lawful possessors of their respective portions and have declared said portions for taxation purposes and that they have been faithfully paying taxes thereon for twenty years.

"Respondents contend that the petitioner has no legal capacity to sue insofar as the island is concerned because an action for reconveyance can only be brought by the owner and not a mere homestead applicant and that petitioner is guilty of estoppel by laches for his failure to assert his right over the land for an unreasonable and unexplained period of time.

"In the instant case, petitioner seeks to nullify the homestead patents and original certificates of title issued in favor of the respondents covering certain portions of the Sombrero Island as well as the reconveyance of the whole island in his favor. The petitioner claims that he has the exclusive right to file an application for homestead patent over the whole island since it was he who requested for its conversion from forest land to agricultural land."6

Respondents filed their Answer with Special and/or Affirmative Defenses and Counterclaim in due time. On June 30, 1999, they also filed a Motion to Dismiss on the ground of the alleged defiance by petitioner of the trial court’s Order to amend his Complaint so he could thus effect a substitution by the legal heirs of the deceased, Respondent Gapilango. The Motion to Dismiss was granted by the RTC in its Order dated July 29, 1999.

Petitioner’s Motion for Reconsideration of the July 29, 1999 Order was denied by the trial court in its Resolution dated December 17, 1999, for being a third and prohibited motion. In his Petition for Certiorari before the CA, petitioner charged the trial court with grave abuse of discretion on the ground that the denied Motion was his first and only Motion for Reconsideration of the aforesaid Order.

Ruling of the Court of Appeals

Instead of limiting itself to the allegation of grave abuse of discretion, the CA ruled on the merits. It held that while petitioner had caused the reclassification of Sombrero Island from forest to agricultural land, he never applied for a homestead patent under the Public Land Act. Hence, he never acquired title to that land.

The CA added that the annulment and cancellation of a homestead patent and the reversion of the property to the State were matters between the latter and the homestead grantee. Unless and until the government takes steps to annul the grant, the homesteader’s right thereto stands.

Finally, granting arguendo that petitioner had the exclusive right to apply for a patent to the land in question, he was already barred by laches for having slept on his right for almost 23 years from the time Respondent Palanca’s title had been issued.

In the Assailed Resolution, the CA acknowledged that it had erred when it ruled on the merits of the case. It agreed with petitioner that the trial court had acted without jurisdiction in perfunctorily dismissing his September 10, 1999 Motion for Reconsideration, on the erroneous ground that it was a third and prohibited motion when it was actually only his first motion.

Nonetheless, the Complaint was dismissed motu proprio by the challenged Resolution of the CA Special Division of five members – with two justices dissenting – pursuant to its "residual prerogative" under Section 1 of Rule 9 of the Rules of Court.

From the allegations of the Complaint, the appellate court opined that petitioner clearly had no standing to seek reconveyance of the disputed land, because he neither held title to it nor even applied for a homestead patent. It reiterated that only the State could sue for cancellation of the title issued upon a homestead patent, and for reversion of the land to the public domain.

Finally, it ruled that prescription had already barred the action for reconveyance. First, petitioner’s action was brought 24 years after the issuance of Palanca’s homestead patent. Under the Public Land Act, such action should have been taken within ten years from the issuance of the homestead certificate of title. Second, it appears from the submission (Annex "F" of the Complaint) of petitioner himself that Respondents Fresnillo and Palanca had been occupying six hectares of the island since 1965, or 33 years before he took legal steps to assert his right to the property. His action was filed beyond the 30-year prescriptive period under Articles 1141 and 1137 of the Civil Code.

Hence, this Petition.7

Issues

In his Memorandum, petitioner raises the following issues:

"1. Is the Court of Appeals correct in resolving the Petition for Certiorari based on an issue not raised (the merits of the case) in the Petition?

"2. Is the Court of Appeals correct in invoking its alleged ‘residual prerogative’ under Section 1, Rule 9 of the 1997 Rules of Civil Procedure in resolving the Petition on an issue not raised in the Petition?"8

The Court’s Ruling

The Petition has no merit.

First Issue:

Propriety of Ruling on the Merits

This is not the first time that petitioner has taken issue with the propriety of the CA’s ruling on the merits. He raised it with the appellate court when he moved for reconsideration of its December 8, 2000 Decision. The CA even corrected itself in its November 20, 2001 Resolution, as follows:

"Upon another review of the case, the Court concedes that it may indeed have lost its way and been waylaid by the variety, complexity and seeming importance of the interests and issues involved in the case below, the apparent reluctance of the judges, five in all, to hear the case, and the volume of the conflicting, often confusing, submissions bearing on incidental matters. We stand corrected."9

That explanation should have been enough to settle the issue. The CA’s Resolution on this point has rendered petitioner’s issue moot. Hence, there is no need to discuss it further. Suffice it to say that the appellate court indeed acted ultra jurisdictio in ruling on the merits of the case when the only issue that could have been, and was in fact, raised was the alleged grave abuse of discretion committed by the trial court in denying petitioner’s Motion for Reconsideration. Settled is the doctrine that the sole office of a writ of certiorari is the correction of errors of jurisdiction. Such writ does not include a review of the evidence,10 more so when no determination of the merits has yet been made by the trial court, as in this case.

Second Issue:

Dismissal for Prescription and Lack of Jurisdiction

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Petitioner next submits that the CA erroneously invoked its "residual prerogatives" under Section 1 of Rule 9 of the Rules of Court when it motu proprio dismissed the Petition for lack of jurisdiction and prescription. According to him, residual prerogative refers to the power that the trial court, in the exercise of its original jurisdiction, may still validly exercise even after perfection of an appeal. It follows that such powers are not possessed by an appellate court.

Petitioner has confused what the CA adverted to as its "residual prerogatives" under Section 1 of Rule 9 of the Rules of Court with the "residual jurisdiction" of trial courts over cases appealed to the CA.

Under Section 1 of Rule 9 of the Rules of Court, defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived, except when (1) lack of jurisdiction over the subject matter, (2) litis pendentia, (3) res judicata and (4) prescription are evident from the pleadings or the evidence on record. In the four excepted instances, the court shall motu proprio dismiss the claim or action. In Gumabon v. Larin11 we explained thus:

"x x x [T]he motu proprio dismissal of a case was traditionally limited to instances when the court clearly had no jurisdiction over the subject matter and when the plaintiff did not appear during trial, failed to prosecute his action for an unreasonable length of time or neglected to comply with the rules or with any order of the court. Outside of these instances, any motu proprio dismissal would amount to a violation of the right of the plaintiff to be heard. Except for qualifying and expanding Section 2, Rule 9, and Section 3, Rule 17, of the Revised Rules of Court, the amendatory 1997 Rules of Civil Procedure brought about no radical change. Under the new rules, a court may motu proprio dismiss a claim when it appears from the pleadings or evidence on record that it has no jurisdiction over the subject matter; when there is another cause of action pending between the same parties for the same cause, or where the action is barred by a prior judgment or by statute of limitations. x x x."12 (Italics supplied)

On the other hand, "residual jurisdiction" is embodied in Section 9 of Rule 41 of the Rules of Court, as follows:

"SEC. 9. Perfection of appeal; effect thereof. – A party’s appeal by notice of appeal is deemed perfected as to him upon the filing of the notice of appeal in due time.

"A party’s appeal by record on appeal is deemed perfected as to him with respect to the subject matter thereof upon the approval of the record on appeal filed in due time.

"In appeals by notice of appeal, the court loses jurisdiction over the case upon the perfection of the appeals filed in due time and the expiration of the time to appeal of the other parties.

"In appeals by record on appeal, the court loses jurisdiction only over the subject matter thereof upon the approval of the records on appeal filed in due time and the expiration of the time to appeal of the other parties.

"In either case, prior to the transmittal of the original record or the record on appeal, the court may issue orders for the protection and preservation of the rights of the parties which do not involve any matter litigated by the appeal, approve compromises, permit appeals of indigent litigants, order execution pending appeal in accordance with Section 2 of Rule 39, and allow withdrawal of the appeal." (Italics supplied)

The "residual jurisdiction" of trial courts is available at a stage in which the court is normally deemed to have lost jurisdiction over the case or the subject matter involved in the appeal. This stage is reached upon the perfection of the appeals by the parties or upon the approval of the records on appeal, but prior to the transmittal of the original records or the records on appeal.13 In either instance, the trial court still retains its so-called residual jurisdiction to issue protective orders, approve compromises, permit appeals of indigent litigants, order execution pending appeal, and allow the withdrawal of the appeal.

The CA’s motu proprio dismissal of petitioner’s Complaint could not have been based, therefore, on residual jurisdiction under Rule 41. Undeniably, such order of dismissal was not one for the protection and preservation of the rights of the parties, pending the disposition of the case on appeal. What the CA referred to as residual prerogatives were the general residual powers of the courts to dismiss an action motu proprio upon the grounds mentioned in Section 1 of Rule 9 of the Rules of Court and under authority of Section 2 of Rule 114 of the same rules.

To be sure, the CA had the excepted instances in mind when it dismissed the Complaint motu proprio "on more fundamental grounds directly bearing on the lower court’s lack of jurisdiction"15 and for prescription of the action. Indeed, when a

court has no jurisdiction over the subject matter, the only power it has is to dismiss the action.16

Jurisdiction over the subject matter is conferred by law and is determined by the allegations in the complaint and the character of the relief sought.17 In his Complaint for "Nullification of Applications for Homestead and Original Certificate of Title No. G-7089 and for Reconveyance of Title,"18 petitioner averred:

"2. That on November 10, 1965, without the knowledge of [petitioner, Respondent] Manuel Palanca Jr., [petitioner’s] cousin, in connivance with his co-[respondent], Lorenzo Agustin, x x x fraudulently and in bad faith:

2.1. x x x made the request for authority to survey as a pre-requisite to the filing of an application for homestead patent in his name and that of his Co-[Respondent] Agustin, [despite being] fully aware that [Petitioner] KATON had previously applied or requested for re-classification and certification of the same land from forest land to agricultural land which request was favorably acted upon and approved as mentioned earlier; a clear case of intrinsic fraud and misrepresentation;

x x x           x x x           x x x

2.3. In stating in his application for homestead patent that he was applying for the VACANT PORTION of Sombrero Island where there was none, the same constituted another clear case of fraud and misrepresentation;

"3. That the issuance of Homestead Patent No. 145927 and OCT No. G-7089 in the name of [Respondent] Manuel Palanca Jr. and the filing of Homestead Patent Applications in the names of [respondents], Lorenzo Agustin, Jesus Gapilango and Juan Fresnillo[,] having been done fraudulently and in bad faith, are ipso facto null and void and of no effect whatsoever."19

x x x           x x x           x x x

"x x x. By a wrongful act or a willful omission and intending the effects with natural necessity arise knowing from such act or omission, [Respondent Palanca] on account of his blood relation, first degree cousins, trust,

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interdependence and intimacy is guilty of intrinsic fraud [sic]. x x x."20

Thereupon, petitioner prayed, among others, for a judgment (1) nullifying the homestead patent applications of Respondents Agustin, Fresnillo and Gapilango as well as Homestead Patent No. 145927 and OCT No. G-7089 in the name of Respondent Palanca; and (2) ordering the director of the Land Management Bureau to reconvey the Sombrero Island to petitioner.21

The question is, did the Complaint sufficiently allege an action for declaration of nullity of the free patent and certificate of title or, alternatively, for reconveyance? Or did it plead merely for reversion?

The Complaint did not sufficiently make a case for any of such actions, over which the trial court could have exercised jurisdiction.

In an action for nullification of title or declaration of its nullity, the complaint must contain the following allegations: 1) that the contested land was privately owned by the plaintiff prior to the issuance of the assailed certificate of title to the defendant; and 2) that the defendant perpetuated a fraud or committed a mistake in obtaining a document of title over the parcel of land claimed by the plaintiff.22 In these cases, the nullity arises not from fraud or deceit, but from the fact that the director of the Land Management Bureau had no jurisdiction to bestow title; hence, the issued patent or certificate of title was void ab initio.23

In an alternative action for reconveyance, the certificate of title is also respected as incontrovertible, but the transfer of the property or title thereto is sought to be nullified on the ground that it was wrongfully or erroneously registered in the defendant’s name.24 As with an annulment of title, a complaint must allege two facts that, if admitted, would entitle the plaintiff to recover title to the disputed land: (1) that the plaintiff was the owner of the land, and (2) that the defendant illegally dispossessed the plaintiff of the property.25 Therefore, the defendant who acquired the property through mistake or fraud is bound to hold and reconvey to the plaintiff the property or the title thereto.26

In the present case, nowhere in the Complaint did petitioner allege that he had previously held title to the land in question. On the contrary, he acknowledged that the disputed island was public land,27 that it had never been privately titled in his name, and that he had not applied for a homestead under the provisions of the Public Land Act.28 This Court has held that a complaint by a private party who alleges that a homestead patent was obtained by fraudulent means, and who consequently prays for its

annulment, does not state a cause of action; hence, such complaint must be dismissed.29

Neither can petitioner’s case be one for reversion. Section 101 of the Public Land Act categorically declares that only the solicitor general or the officer in his stead may institute such an action.30 A private person may not bring an action for reversion or any other action that would have the effect of canceling a free patent and its derivative title, with the result that the land thereby covered would again form part of the public domain.31

Thus, when the plaintiff admits in the complaint that the disputed land will revert to the public domain even if the title is canceled or amended, the action is for reversion; and the proper party who may bring action is the government, to which the property will revert.32 A mere homestead applicant, not being the real party in interest, has no cause of action in a suit for reconveyance.33 As it is, vested rights over the land applied for under a homestead may be validly claimed only by the applicant, after approval by the director of the Land Management Bureau of the former’s final proof of homestead patent.34

Consequently, the dismissal of the Complaint is proper not only because of lack of jurisdiction, but also because of the utter absence of a cause of action,35 a defense raised by respondents in their Answer.36 Section 2 of Rule 3 of the Rules of Court37 ordains 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. Indeed, one who has no right or interest to protect has no cause of action by which to invoke, as a party-plaintiff, the jurisdiction of the court.38

Finally, assuming that petitioner is the proper party to bring the action for annulment of title or its reconveyance, the case should still be dismissed for being time-barred.39 It is not disputed that a homestead patent and an Original Certificate of Title was issued to Palanca on February 21, 1977,40 while the Complaint was filed only on October 6, 1998. Clearly, the suit was brought way past ten years from the date of the issuance of the Certificate, the prescriptive period for reconveyance of fraudulently registered real property.41

It must likewise be stressed that Palanca’s title -- which attained the status of indefeasibility one year from the issuance of the patent and the Certificate of Title in February 1977 -- is no longer open to review on the ground of actual fraud. Ybanez v. Intermediate Appellate Court42 ruled that a certificate of title, issued under an administrative proceeding pursuant to a homestead patent, is as indefeasible as one issued under a judicial registration proceeding one year from its issuance;

provided, however, that the land covered by it is disposable public land, as in this case.

In Aldovino v. Alunan,43 the Court has held that when the plaintiff’s own complaint shows clearly that the action has prescribed, such action may be dismissed even if the defense of prescription has not been invoked by the defendant. In Gicano v. Gegato,44 we also explained thus:

"x x x [T]rial courts have authority and discretion to dismiss an action on the ground of prescription when the parties' pleadings or other facts on record show it to be indeed time-barred; (Francisco v. Robles, Feb. 15, 1954; Sison v. McQuaid, 50 O.G. 97; Bambao v. Lednicky, Jan. 28, 1961; Cordova v. Cordova, Jan. 14, 1958; Convets, Inc. v. NDC, Feb. 28, 1958; 32 SCRA 529; Sinaon v. Sorongan, 136 SCRA 408); and it may do so on the basis of a motion to dismiss (Sec. 1,f, Rule 16, Rules of Court), or an answer which sets up such ground as an affirmative defense (Sec. 5, Rule 16), or even if the ground is alleged after judgment on the merits, as in a motion for reconsideration (Ferrer v. Ericta, 84 SCRA 705); or even if the defense has not been asserted at all, as where no statement thereof is found in the pleadings (Garcia v. Mathis, 100 SCRA 250; PNB v. Pacific Commission House, 27 SCRA 766; Chua Lamco v. Dioso, et al., 97 Phil. 821); or where a defendant has been declared in default (PNB v. Perez, 16 SCRA 270). What is essential only, to repeat, is that the facts demonstrating the lapse of the prescriptive period be otherwise sufficiently and satisfactorily apparent on the record; either in the averments of the plaintiff's complaint, or otherwise established by the evidence."45 (Italics supplied)

Clearly then, the CA did not err in dismissing the present case. After all, if and when they are able to do so, courts must endeavor to settle entire controversies before them to prevent future litigations.46

WHEREFORE, the Petition is hereby DENIED, and the assailed Resolution AFFIRMED. The dismissal of the Complaint in Civil Case No. 3231 is SUSTAINED on the grounds of lack of jurisdiction, failure to state a cause of action and prescription. Costs against petitioner.

SO ORDERED.

Sandoval-Gutierrez, Corona, and Carpio Morales*, JJ., concur.

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G.R. No. 147406               July 14, 2008

VENANCIO FIGUEROA y CERVANTES,1 Petitioner, vs.PEOPLE OF THE PHILIPPINES, Respondent.

D E C I S I O N

NACHURA, J.:

When is a litigant estopped by laches from assailing the jurisdiction of a tribunal? This is the paramount issue raised in this petition for review of the February 28, 2001 Decision2 of the Court of Appeals (CA) in CA-G.R. CR No. 22697.

Pertinent are the following antecedent facts and proceedings:

On July 8, 1994, an information3 for reckless imprudence resulting in homicide was filed against the petitioner before the Regional Trial Court (RTC) of Bulacan, Branch 18.4 The case was docketed as Criminal Case No. 2235-M-94.5 Trial on the merits ensued and on August 19, 1998, the trial court convicted the petitioner as charged.6 In his appeal before the CA, the petitioner questioned, among others, for the first time, the trial court’s jurisdiction.7

The appellate court, however, in the challenged decision, considered the petitioner to have actively participated in the trial and to have belatedly attacked the jurisdiction of the RTC; thus, he was already estopped by laches from asserting the trial court’s lack of jurisdiction. Finding no other ground to reverse the trial court’s decision, the CA affirmed the petitioner’s conviction but modified the penalty imposed and the damages awarded.8

Dissatisfied, the petitioner filed the instant petition for review on certiorari raising the following issues for our resolution:

a. Does the fact that the petitioner failed to raise the issue of jurisdiction during the trial of this case, which was initiated and filed by the public prosecutor before the wrong court, constitute laches in relation to the doctrine laid down in Tijam v. Sibonghanoy, notwithstanding the fact that said issue was immediately raised in petitioner’s appeal to the Honorable Court of Appeals? Conversely, does the active participation of the petitioner in the trial of his case, which is initiated and filed not by him but by the public prosecutor, amount to estoppel?

b. Does the admission of the petitioner that it is difficult to immediately stop a bus while it is running at 40 kilometers per hour for the purpose of avoiding a person who unexpectedly crossed the road, constitute enough incriminating evidence to warrant his conviction for the crime charged?

c. Is the Honorable Court of Appeals justified in considering the place of accident as falling within Item 4 of Section 35 (b) of the Land Transportation and Traffic Code, and subsequently ruling that the speed limit thereto is only 20 kilometers per hour, when no evidence whatsoever to that effect was ever presented by the prosecution during the trial of this case?

d. Is the Honorable Court of Appeals justified in convicting the petitioner for homicide through reckless imprudence (the legally correct designation is "reckless imprudence resulting to homicide") with violation of the Land Transportation and Traffic Code when the prosecution did not prove this during the trial and, more importantly, the information filed against the petitioner does not contain an allegation to that effect?

e. Does the uncontroverted testimony of the defense witness Leonardo Hernal that the victim unexpectedly crossed the road resulting in him getting hit by the bus driven by the petitioner not enough evidence to acquit him of the crime charged?9

Applied uniformly is the familiar rule that the jurisdiction of the court to hear and decide a case is conferred by the law in force at the time of the institution of the action, unless such statute provides for a retroactive application thereof.10 In this case, at the time the criminal information for reckless imprudence resulting in homicide with violation of the Automobile Law (now Land Transportation and Traffic Code) was filed, Section 32(2) of Batas Pambansa (B.P.) Blg. 12911 had already been amended by Republic Act No. 7691.12 The said provision thus reads:

Sec. 32. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts in Criminal Cases.—Except in cases falling within the exclusive original jurisdiction of Regional Trial Courts and the Sandiganbayan, the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:

x x x x

(2) Exclusive original jurisdiction over all offenses punishable with imprisonment not exceeding six (6) years irrespective of the amount of fine, and regardless of other imposable accessory or other penalties, including the civil liability arising from such offenses or predicated thereon, irrespective of kind, nature, value or amount thereof: Provided, however, That in offenses involving damage to property through criminal negligence, they shall have exclusive original jurisdiction thereof.

As the imposable penalty for the crime charged herein is prision correccional in its medium and maximum periods or imprisonment for 2 years, 4 months and 1 day to 6 years,13 jurisdiction to hear and try the same is conferred on the Municipal Trial Courts (MTCs). Clearly, therefore, the RTC of Bulacan does not have jurisdiction over Criminal Case No. 2235-M-94.

While both the appellate court and the Solicitor General acknowledge this fact, they nevertheless are of the position that the principle of estoppel by laches has already precluded the petitioner from questioning the jurisdiction of the RTC—the trial went on for 4 years with the petitioner actively participating therein and without him ever raising the jurisdictional infirmity. The petitioner, for his part, counters that the lack of jurisdiction of a court over the subject matter may be raised at any time even for the first time on appeal. As undue delay is further absent herein, the principle of laches will not be applicable.

To settle once and for all this problem of jurisdiction vis-à-vis estoppel by laches, which continuously confounds the bench and the bar, we shall analyze the various Court decisions on the matter.

As early as 1901, this Court has declared that unless jurisdiction has been conferred by some legislative act, no court or tribunal can act on a matter submitted to it.14 We went on to state in U.S. v. De La Santa15 that:

It has been frequently held that a lack of jurisdiction over the subject-matter is fatal, and subject to objection at any stage of the proceedings, either in the court below or on appeal (Ency. of Pl. & Pr., vol. 12, p. 189, and large array of cases there cited), and indeed, where the subject-matter is not within the jurisdiction, the court may dismiss the proceeding ex mero motu. (4 Ill., 133; 190 Ind., 79; Chipman vs. Waterbury, 59 Conn., 496.)

Jurisdiction over the subject-matter in a judicial proceeding is conferred by the sovereign authority which organizes the court; it is given only by law and in the manner prescribed by law and an objection based on the lack of such jurisdiction can not be waived by the parties. x x x16

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Later, in People v. Casiano,17 the Court explained:

4. The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on appeal, from assailing such jurisdiction, for the same "must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel" (5 C.J.S., 861-863). However, if the lower court had jurisdiction, and the case was heard and decided upon a given theory, such, for instance, as that the court had no jurisdiction, the party who induced it to adopt such theory will not be permitted, on appeal, to assume an inconsistent position—that the lower court had jurisdiction. Here, the principle of estoppel applies. The rule that jurisdiction is conferred by law, and does not depend upon the will of the parties, has no bearing thereon. Thus, Corpus Juris Secundum says:

Where accused has secured a decision that the indictment is void, or has been granted an instruction based on its defective character directing the jury to acquit, he is estopped, when subsequently indicted, to assert that the former indictment was valid. In such case, there may be a new prosecution whether the indictment in the former prosecution was good or bad. Similarly, where, after the jury was impaneled and sworn, the court on accused's motion quashed the information on the erroneous assumption that the court had no jurisdiction, accused cannot successfully plead former jeopardy to a new information. x x x (22 C.J.S., sec. 252, pp. 388-389; italics ours.)

Where accused procured a prior conviction to be set aside on the ground that the court was without jurisdiction, he is estopped subsequently to assert, in support of a defense of previous jeopardy, that such court had jurisdiction." (22 C.J.S. p. 378.)18

But in Pindañgan Agricultural Co., Inc. v. Dans,19 the Court, in not sustaining the plea of lack of jurisdiction by the plaintiff-appellee therein, made the following observations:

It is surprising why it is only now, after the decision has been rendered, that the plaintiff-appellee presents the question of this Court’s jurisdiction over the case. Republic Act No. 2613 was enacted on August 1, 1959. This case was argued on January 29, 1960. Notwithstanding this fact, the jurisdiction of this Court was never impugned until the adverse decision of this Court was handed down. The conduct of counsel leads us to believe that they must have always been of the belief that notwithstanding said enactment of Republic Act 2613 this Court has jurisdiction of the case, such conduct being born out of a conviction that the actual

real value of the properties in question actually exceeds the jurisdictional amount of this Court (over P200,000). Our minute resolution in G.R. No. L-10096, Hyson Tan, et al. vs. Filipinas Compaña de Seguros, et al., of March 23, 1956, a parallel case, is applicable to the conduct of plaintiff-appellee in this case, thus:

x x x that an appellant who files his brief and submits his case to the Court of Appeals for decision, without questioning the latter’s jurisdiction until decision is rendered therein, should be considered as having voluntarily waived so much of his claim as would exceed the jurisdiction of said Appellate Court; for the reason that a contrary rule would encourage the undesirable practice of appellants submitting their cases for decision to the Court of Appeals in expectation of favorable judgment, but with intent of attacking its jurisdiction should the decision be unfavorable: x x x20

Then came our ruling in Tijam v. Sibonghanoy21 that a party may be barred by laches from invoking lack of jurisdiction at a late hour for the purpose of annulling everything done in the case with the active participation of said party invoking the plea. We expounded, thus:

A party may be estopped or barred from raising a question in different ways and for different reasons. Thus, we speak of estoppel in pais, of estoppel by deed or by record, and of estoppel by laches.

Laches, in a general sense, is failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned it or declined to assert it.

The doctrine of laches or of "stale demands" is based upon grounds of public policy which requires, for the peace of society, the discouragement of stale claims and, unlike the statute of limitations, is not a mere question of time but is principally a question of the inequity or unfairness of permitting a right or claim to be enforced or asserted.

It has been held that a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after obtaining or failing to obtain such relief, repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79). In the case just cited, by way of explaining the rule, it was further said that the question whether the court had jurisdiction either of the subject matter of the action or of the parties was not important in such cases because the party is barred from such conduct not

because the judgment or order of the court is valid and conclusive as an adjudication, but for the reason that such a practice cannot be tolerated—obviously for reasons of public policy.

Furthermore, it has also been held that after voluntarily submitting a cause and encountering an adverse decision on the merits, it is too late for the loser to question the jurisdiction or power of the court (Pease vs. Rathbun-Jones etc., 243 U.S. 273, 61 L. Ed. 715, 37 S.Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659). And in Littleton vs. Burgess, 16 Wyo. 58, the Court said that it is not right for a party who has affirmed and invoked the jurisdiction of a court in a particular matter to secure an affirmative relief, to afterwards deny that same jurisdiction to escape a penalty.

Upon this same principle is what We said in the three cases mentioned in the resolution of the Court of Appeals of May 20, 1963 (supra)—to the effect that we frown upon the "undesirable practice" of a party submitting his case for decision and then accepting the judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse—as well as in Pindañgan etc. vs. Dans et al., G.R. L-14591, September 26, 1962; Montelibano et al. vs. Bacolod-Murcia Milling Co., Inc., G.R. L-15092; Young Men Labor Union etc. vs. The Court of Industrial Relations et al., G.R. L-20307, Feb. 26, 1965, and Mejia vs. Lucas, 100 Phil. p. 277.

The facts of this case show that from the time the Surety became a quasi-party on July 31, 1948, it could have raised the question of the lack of jurisdiction of the Court of First Instance of Cebu to take cognizance of the present action by reason of the sum of money involved which, according to the law then in force, was within the original exclusive jurisdiction of inferior courts. It failed to do so. Instead, at several stages of the proceedings in the court a quo, as well as in the Court of Appeals, it invoked the jurisdiction of said courts to obtain affirmative relief and submitted its case for a final adjudication on the merits. It was only after an adverse decision was rendered by the Court of Appeals that it finally woke up to raise the question of jurisdiction. Were we to sanction such conduct on its part, We would in effect be declaring as useless all the proceedings had in the present case since it was commenced on July 19, 1948 and compel the judgment creditors to go up their Calvary once more. The inequity and unfairness of this is not only patent but revolting.22

For quite a time since we made this pronouncement in Sibonghanoy, courts and tribunals, in resolving issues that involve the belated invocation of lack of jurisdiction, have applied the principle of estoppel by laches. Thus, in Calimlim v. Ramirez,23 we pointed out that Sibonghanoy was developing into a general rule rather than the exception:

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A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to cite is that the jurisdiction of a court over the subject-matter of the action is a matter of law and may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court may be raised at any stage of the proceedings, even on appeal. This doctrine has been qualified by recent pronouncements which stemmed principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to situations which were obviously not contemplated therein. The exceptional circumstance involved in Sibonghanoy which justified the departure from the accepted concept of non-waivability of objection to jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the exception, but rather the general rule, virtually overthrowing altogether the time-honored principle that the issue of jurisdiction is not lost by waiver or by estoppel.

In Sibonghanoy, the defense of lack of jurisdiction of the court that rendered the questioned ruling was held to be barred by estoppel by laches. It was ruled that the lack of jurisdiction having been raised for the first time in a motion to dismiss filed almost fifteen (15) years after the questioned ruling had been rendered, such a plea may no longer be raised for being barred by laches. As defined in said case, laches is "failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert has abandoned it or declined to assert it.24

In Calimlim, despite the fact that the one who benefited from the plea of lack of jurisdiction was the one who invoked the court’s jurisdiction, and who later obtained an adverse judgment therein, we refused to apply the ruling in Sibonghanoy. The Court accorded supremacy to the time-honored principle that the issue of jurisdiction is not lost by waiver or by estoppel.

Yet, in subsequent cases decided after Calimlim, which by sheer volume are too plentiful to mention, the Sibonghanoy doctrine, as foretold in Calimlim, became the rule rather than the exception. As such, in Soliven v. Fastforms Philippines, Inc.,25 the Court ruled:

While it is true that jurisdiction may be raised at any time, "this rule presupposes that estoppel has not supervened." In the instant case, respondent actively participated in all stages of the proceedings before the trial court and invoked its authority by asking for an affirmative relief. Clearly, respondent is estopped from challenging the trial court’s jurisdiction, especially when an

adverse judgment has been rendered. In PNOC Shipping and Transport Corporation vs. Court of Appeals, we held:

Moreover, we note that petitioner did not question at all the jurisdiction of the lower court x x x in its answers to both the amended complaint and the second amended complaint. It did so only in its motion for reconsideration of the decision of the lower court after it had received an adverse decision. As this Court held in Pantranco North Express, Inc. vs. Court of Appeals (G.R. No. 105180, July 5, 1993, 224 SCRA 477, 491), participation in all stages of the case before the trial court, that included invoking its authority in asking for affirmative relief, effectively barred petitioner by estoppel from challenging the court’s jurisdiction. Notably, from the time it filed its answer to the second amended complaint on April 16, 1985, petitioner did not question the lower court’s jurisdiction. It was only on December 29, 1989 when it filed its motion for reconsideration of the lower court’s decision that petitioner raised the question of the lower court’s lack of jurisdiction. Petitioner thus foreclosed its right to raise the issue of jurisdiction by its own inaction. (italics ours)

Similarly, in the subsequent case of Sta. Lucia Realty and Development, Inc. vs. Cabrigas, we ruled:

In the case at bar, it was found by the trial court in its 30 September 1996 decision in LCR Case No. Q-60161(93) that private respondents (who filed the petition for reconstitution of titles) failed to comply with both sections 12 and 13 of RA 26 and therefore, it had no jurisdiction over the subject matter of the case. However, private respondents never questioned the trial court’s jurisdiction over its petition for reconstitution throughout the duration of LCR Case No. Q-60161(93). On the contrary, private respondents actively participated in the reconstitution proceedings by filing pleadings and presenting its evidence. They invoked the trial court’s jurisdiction in order to obtain affirmative relief – the reconstitution of their titles. Private respondents have thus foreclosed their right to raise the issue of jurisdiction by their own actions.

The Court has constantly upheld the doctrine that while jurisdiction may be assailed at any stage, a litigant’s participation in all stages of the case before the trial court, including the invocation of its authority in asking for affirmative relief, bars such party from challenging the court’s jurisdiction (PNOC Shipping and Transport Corporation vs. Court of Appeals, 297 SCRA 402 [1998]). A party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and after obtaining or failing to obtain such relief, repudiate or question that same jurisdiction (Asset Privatization Trust vs. Court of Appeals, 300 SCRA 579 [1998]; Province of Bulacan vs. Court of Appeals, 299 SCRA 442

[1998]). The Court frowns upon the undesirable practice of a party participating in the proceedings and submitting his case for decision and then accepting judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse (Producers Bank of the Philippines vs. NLRC, 298 SCRA 517 [1998], citing Ilocos Sur Electric Cooperative, Inc. vs. NLRC, 241 SCRA 36 [1995]). (italics ours)26

Noteworthy, however, is that, in the 2005 case of Metromedia Times Corporation v. Pastorin,27 where the issue of lack of jurisdiction was raised only in the National Labor Relations Commission (NLRC) on appeal, we stated, after examining the doctrines of jurisdiction vis-à-vis estoppel, that the ruling in Sibonghanoy stands as an exception, rather than the general rule. Metromedia, thus, was not estopped from assailing the jurisdiction of the labor arbiter before the NLRC on appeal.281avvphi1

Later, in Francel Realty Corporation v. Sycip,29 the Court clarified that:

Petitioner argues that the CA’s affirmation of the trial court’s dismissal of its case was erroneous, considering that a full-blown trial had already been conducted. In effect, it contends that lack of jurisdiction could no longer be used as a ground for dismissal after trial had ensued and ended.

The above argument is anchored on estoppel by laches, which has been used quite successfully in a number of cases to thwart dismissals based on lack of jurisdiction. Tijam v. Sibonghanoy, in which this doctrine was espoused, held that a party may be barred from questioning a court’s jurisdiction after being invoked to secure affirmative relief against its opponent. In fine, laches prevents the issue of lack of jurisdiction from being raised for the first time on appeal by a litigant whose purpose is to annul everything done in a trial in which it has actively participated.

Laches is defined as the "failure or neglect for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned it or declined to assert it."

The ruling in Sibonghanoy on the matter of jurisdiction is, however, the exception rather than the rule.1avvphi1 Estoppel by laches may be invoked to bar the issue of lack of jurisdiction only in cases in which the factual milieu is analogous to that in the cited case. In such controversies, laches should be clearly present; that is, lack of jurisdiction must have been raised so belatedly as to warrant the presumption that the party entitled to

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assert it had abandoned or declined to assert it. That Sibonghanoy applies only to exceptional circumstances is clarified in Calimlim v. Ramirez, which we quote:

A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to cite is that the jurisdiction of a court over the subject-matter of the action is a matter of law and may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court may be raised at any stage of the proceedings, even on appeal. This doctrine has been qualified by recent pronouncements which stemmed principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to situations which were obviously not contemplated therein. The exceptional circumstance involved in Sibonghanoy which justified the departure from the accepted concept of non-waivability of objection to jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the exception, but rather the general rule, virtually overthrowing altogether the time-honored principle that the issue of jurisdiction is not lost by waiver or by estoppel.

Indeed, the general rule remains: a court’s lack of jurisdiction may be raised at any stage of the proceedings, even on appeal. The reason is that jurisdiction is conferred by law, and lack of it affects the very authority of the court to take cognizance of and to render judgment on the action. Moreover, jurisdiction is determined by the averments of the complaint, not by the defenses contained in the answer.30

Also, in Mangaliag v. Catubig-Pastoral,31 even if the pleader of lack of jurisdiction actively took part in the trial proceedings by presenting a witness to seek exoneration, the Court, reiterating the doctrine in Calimlim, said:

Private respondent argues that the defense of lack of jurisdiction may be waived by estoppel through active participation in the trial. Such, however, is not the general rule but an exception, best characterized by the peculiar circumstances in Tijam vs. Sibonghanoy. In Sibonghanoy, the party invoking lack of jurisdiction did so only after fifteen years and at a stage when the proceedings had already been elevated to the CA. Sibonghanoyis an exceptional case because of the presence of laches, which was defined therein as failure or neglect for an unreasonable and unexplained length of time to do that which, by exercising due diligence, could or should have been done earlier; it is the negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert has abandoned it or declined to assert it.32

And in the more recent Regalado v. Go,33 the Court again emphasized that laches should be clearly present for the Sibonghanoy doctrine to be applicable, thus:

Laches is defined as the "failure or neglect for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier, it is negligence or omission to assert a right within a reasonable length of time, warranting a presumption that the party entitled to assert it either has abandoned it or declined to assert it."

The ruling in People v. Regalario that was based on the landmark doctrine enunciated in Tijam v. Sibonghanoy on the matter of jurisdiction by estoppel is the exception rather than the rule. Estoppel by laches may be invoked to bar the issue of lack of jurisdiction only in cases in which the factual milieu is analogous to that in the cited case. In such controversies, laches should have been clearly present; that is, lack of jurisdiction must have been raised so belatedly as to warrant the presumption that the party entitled to assert it had abandoned or declined to assert it.

In Sibonghanoy, the defense of lack of jurisdiction was raised for the first time in a motion to dismiss filed by the Surety almost 15 years after the questioned ruling had been rendered. At several stages of the proceedings, in the court a quo as well as in the Court of Appeals, the Surety invoked the jurisdiction of the said courts to obtain affirmative relief and submitted its case for final adjudication on the merits. It was only when the adverse decision was rendered by the Court of Appeals that it finally woke up to raise the question of jurisdiction.

Clearly, the factual settings attendant in Sibonghanoy are not present in the case at bar. Petitioner Atty. Regalado, after the receipt of the Court of Appeals resolution finding her guilty of contempt, promptly filed a Motion for Reconsideration assailing the said court’s jurisdiction based on procedural infirmity in initiating the action. Her compliance with the appellate court’s directive to show cause why she should not be cited for contempt and filing a single piece of pleading to that effect could not be considered as an active participation in the judicial proceedings so as to take the case within the milieu of Sibonghanoy. Rather, it is the natural fear to disobey the mandate of the court that could lead to dire consequences that impelled her to comply.34

The Court, thus, wavered on when to apply the exceptional circumstance in Sibonghanoy and on when to apply the general rule enunciated as early as in De La Santa and expounded at length in Calimlim. The general rule should, however, be, as it has always been, that the issue of jurisdiction may be raised at any stage of the proceedings, even on appeal, and is not lost by

waiver or by estoppel. Estoppel by laches, to bar a litigant from asserting the court’s absence or lack of jurisdiction, only supervenes in exceptional cases similar to the factual milieu of Tijam v. Sibonghanoy. Indeed, the fact that a person attempts to invoke unauthorized jurisdiction of a court does not estop him from thereafter challenging its jurisdiction over the subject matter, since such jurisdiction must arise by law and not by mere consent of the parties. This is especially true where the person seeking to invoke unauthorized jurisdiction of the court does not thereby secure any advantage or the adverse party does not suffer any harm.35

Applying the said doctrine to the instant case, the petitioner is in no way estopped by laches in assailing the jurisdiction of the RTC, considering that he raised the lack thereof in his appeal before the appellate court. At that time, no considerable period had yet elapsed for laches to attach. True, delay alone, though unreasonable, will not sustain the defense of "estoppel by laches" unless it further appears that the party, knowing his rights, has not sought to enforce them until the condition of the party pleading laches has in good faith become so changed that he cannot be restored to his former state, if the rights be then enforced, due to loss of evidence, change of title, intervention of equities, and other causes.36 In applying the principle of estoppel by laches in the exceptional case of Sibonghanoy, the Court therein considered the patent and revolting inequity and unfairness of having the judgment creditors go up their Calvary once more after more or less 15 years.37 The same, however, does not obtain in the instant case.

We note at this point that estoppel, being in the nature of a forfeiture, is not favored by law. It is to be applied rarely—only from necessity, and only in extraordinary circumstances. The doctrine must be applied with great care and the equity must be strong in its favor.38 When misapplied, the doctrine of estoppel may be a most effective weapon for the accomplishment of injustice.39 Moreover, a judgment rendered without jurisdiction over the subject matter is void.40 Hence, the Revised Rules of Court provides for remedies in attacking judgments rendered by courts or tribunals that have no jurisdiction over the concerned cases. No laches will even attach when the judgment is null and void for want of jurisdiction.41 As we have stated in Heirs of Julian Dela Cruz and Leonora Talaro v. Heirs of Alberto Cruz,42

It is axiomatic that the jurisdiction of a tribunal, including a quasi-judicial officer or government agency, over the nature and subject matter of a petition or complaint is determined by the material allegations therein and the character of the relief prayed for, irrespective of whether the petitioner or complainant is entitled to any or all such reliefs. Jurisdiction over the nature and subject matter of an action is conferred by the Constitution and the law,

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and not by the consent or waiver of the parties where the court otherwise would have no jurisdiction over the nature or subject matter of the action. Nor can it be acquired through, or waived by, any act or omission of the parties. Moreover, estoppel does not apply to confer jurisdiction to a tribunal that has none over the cause of action. x x x

Indeed, the jurisdiction of the court or tribunal is not affected by the defenses or theories set up by the defendant or respondent in his answer or motion to dismiss. Jurisdiction should be determined by considering not only the status or the relationship of the parties but also the nature of the issues or questions that is the subject of the controversy. x x x x The proceedings before a court or tribunal without jurisdiction, including its decision, are null and void, hence, susceptible to direct and collateral attacks.43

With the above considerations, we find it unnecessary to resolve the other issues raised in the petition.

WHEREFORE, premises considered, the petition for review on certiorari is GRANTED. Criminal Case No. 2235-M-94 is hereby DISMISSED without prejudice.

SO ORDERED.

ANTONIO EDUARDO B. NACHURAAssociate Justice

WE CONCUR:

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G.R. No. 162059             January 22, 2008

HANNAH EUNICE D. SERANA, petitioner, vs.SANDIGANBAYAN and PEOPLE OF THE PHILIPPINES, respondents.

D E C I S I O N

REYES, R.T., J.:

CAN the Sandiganbayan try a government scholaran** accused, along with her brother, of swindling government funds?

MAAARI bang litisin ng Sandiganbayan ang isang iskolar ng bayan, at ang kanyang kapatid, na kapwa pinararatangan ng estafa ng pera ng bayan?

The jurisdictional question is posed in this petition for certiorari assailing the Resolutions1 of the Sandiganbayan, Fifth Division, denying petitioner’s motion to quash the information and her motion for reconsideration.

The Antecedents

Petitioner Hannah Eunice D. Serana was a senior student of the University of the Philippines-Cebu. A student of a state university is known as a government scholar. She was appointed by then President Joseph Estrada on December 21, 1999 as a student regent of UP, to serve a one-year term starting January 1, 2000 and ending on December 31, 2000.

In the early part of 2000, petitioner discussed with President Estrada the renovation of Vinzons Hall Annex in UP Diliman.2 On September 4, 2000, petitioner, with her siblings and relatives, registered with the Securities and Exchange Commission the Office of the Student Regent Foundation, Inc. (OSRFI).3

One of the projects of the OSRFI was the renovation of the Vinzons Hall Annex.4 President Estrada gave Fifteen Million Pesos (P15,000,000.00) to the OSRFI as financial assistance for the proposed renovation. The source of the funds, according to the information, was the Office of the President.

The renovation of Vinzons Hall Annex failed to materialize.5 The succeeding student regent, Kristine Clare Bugayong, and

Christine Jill De Guzman, Secretary General of the KASAMA sa U.P., a system-wide alliance of student councils within the state university, consequently filed a complaint for Malversation of Public Funds and Property with the Office of the Ombudsman.6

On July 3, 2003, the Ombudsman, after due investigation, found probable cause to indict petitioner and her brother Jade Ian D. Serana for estafa, docketed as Criminal Case No. 27819 of the Sandiganbayan.7 The Information reads:

The undersigned Special Prosecution Officer III, Office of the Special Prosecutor, hereby accuses HANNAH EUNICE D. SERANA and JADE IAN D. SERANA of the crime of Estafa, defined and penalized under Paragraph 2(a), Article 315 of the Revised Penal Code, as amended committed as follows:

That on October, 24, 2000, or sometime prior or subsequent thereto, in Quezon City, Metro Manila, Philippines, and within the jurisdiction of this Honorable Court, above-named accused, HANNAH EUNICE D. SERANA, a high-ranking public officer, being then the Student Regent of the University of the Philippines, Diliman, Quezon City, while in the performance of her official functions, committing the offense in relation to her office and taking advantage of her position, with intent to gain, conspiring with her brother, JADE IAN D. SERANA, a private individual, did then and there wilfully, unlawfully and feloniously defraud the government by falsely and fraudulently representing to former President Joseph Ejercito Estrada that the renovation of the Vinzons Hall of the University of the Philippines will be renovated and renamed as "President Joseph Ejercito Estrada Student Hall," and for which purpose accused HANNAH EUNICE D. SERANA requested the amount of FIFTEEN MILLION PESOS (P15,000,000.00), Philippine Currency, from the Office of the President, and the latter relying and believing on said false pretenses and misrepresentation gave and delivered to said accused Land Bank Check No. 91353 dated October 24, 2000 in the amount of FIFTEEN MILLION PESOS (P15,000,000.00), which check was subsequently encashed by accused Jade Ian D. Serana on October 25, 2000 and misappropriated for their personal use and benefit, and despite repeated demands made upon the accused for them to return aforesaid amount, the said accused failed and refused to do so to the damage and prejudice of the government in the aforesaid amount.

CONTRARY TO LAW. (Underscoring supplied)

Petitioner moved to quash the information. She claimed that the Sandiganbayan does not have any jurisdiction over the offense charged or over her person, in her capacity as UP student regent.

Petitioner claimed that Republic Act (R.A.) No. 3019, as amended by R.A. No. 8249, enumerates the crimes or offenses over which the Sandiganbayan has jurisdiction.8 It has no jurisdiction over the crime of estafa.9 It only has jurisdiction over crimes covered by Title VII, Chapter II, Section 2 (Crimes Committed by Public Officers), Book II of the Revised Penal Code (RPC). Estafa falling under Title X, Chapter VI (Crimes Against Property), Book II of the RPC is not within the Sandiganbayan’s jurisdiction.

She also argued that it was President Estrada, not the government, that was duped. Even assuming that she received the P15,000,000.00, that amount came from Estrada, not from the coffers of the government.10

Petitioner likewise posited that the Sandiganbayan had no jurisdiction over her person. As a student regent, she was not a public officer since she merely represented her peers, in contrast to the other regents who held their positions in an ex officio capacity. She addsed that she was a simple student and did not receive any salary as a student regent.

She further contended that she had no power or authority to receive monies or funds. Such power was vested with the Board of Regents (BOR) as a whole. Since it was not alleged in the information that it was among her functions or duties to receive funds, or that the crime was committed in connection with her official functions, the same is beyond the jurisdiction of the Sandiganbayan citing the case of Soller v. Sandiganbayan.11

The Ombudsman opposed the motion.12 It disputed petitioner’s interpretation of the law. Section 4(b) of Presidential Decree (P.D.) No. 1606 clearly contains the catch -all phrase "in relation to office," thus, the Sandiganbayan has jurisdiction over the charges against petitioner. In the same breath, the prosecution countered that the source of the money is a matter of defense. It should be threshed out during a full-blown trial.13

According to the Ombudsman, petitioner, despite her protestations, iwas a public officer. As a member of the BOR, she hads the general powers of administration and exerciseds the corporate powers of UP. Based on Mechem’s definition of a public office, petitioner’s stance that she was not compensated, hence,

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not a public officer, is erroneous. Compensation is not an essential part of public office. Parenthetically, compensation has been interpreted to include allowances. By this definition, petitioner was compensated.14

Sandiganbayan Disposition

In a Resolution dated November 14, 2003, the Sandiganbayan denied petitioner’s motion for lack of merit.15 It ratiocinated:

The focal point in controversy is the jurisdiction of the Sandiganbayan over this case.

It is extremely erroneous to hold that only criminal offenses covered by Chapter II, Section 2, Title VII, Book II of the Revised Penal Code are within the jurisdiction of this Court. As correctly pointed out by the prosecution, Section 4(b) of R.A. 8249 provides that the Sandiganbayan also has jurisdiction over other offenses committed by public officials and employees in relation to their office. From this provision, there is no single doubt that this Court has jurisdiction over the offense of estafa committed by a public official in relation to his office.

Accused-movant’s claim that being merely a member in representation of the student body, she was never a public officer since she never received any compensation nor does she fall under Salary Grade 27, is of no moment, in view of the express provision of Section 4 of Republic Act No. 8249 which provides:

Sec. 4. Jurisdiction – The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving:

(A) x x x

(1) Officials of the executive branch occupying the positions of regional director and higher, otherwise classified as Grade "27" and higher, of the Compensation and Position Classification Act of 1989 (Republic Act No. 6758), specifically including:

x x x x

(g) Presidents, directors or trustees, or managers of government-owned or controlled corporations, state

universities or educational institutions or foundations. (Italics supplied)

It is very clear from the aforequoted provision that the Sandiganbayan has original exclusive jurisdiction over all offenses involving the officials enumerated in subsection (g), irrespective of their salary grades, because the primordial consideration in the inclusion of these officials is the nature of their responsibilities and functions.

Is accused-movant included in the contemplated provision of law?

A meticulous review of the existing Charter of the University of the Philippines reveals that the Board of Regents, to which accused-movant belongs, exclusively exercises the general powers of administration and corporate powers in the university, such as: 1) To receive and appropriate to the ends specified by law such sums as may be provided by law for the support of the university; 2) To prescribe rules for its own government and to enact for the government of the university such general ordinances and regulations, not contrary to law, as are consistent with the purposes of the university; and 3) To appoint, on recommendation of the President of the University, professors, instructors, lecturers and other employees of the University; to fix their compensation, hours of service, and such other duties and conditions as it may deem proper; to grant to them in its discretion leave of absence under such regulations as it may promulgate, any other provisions of law to the contrary notwithstanding, and to remove them for cause after an investigation and hearing shall have been had.

It is well-established in corporation law that the corporation can act only through its board of directors, or board of trustees in the case of non-stock corporations. The board of directors or trustees, therefore, is the governing body of the corporation.

It is unmistakably evident that the Board of Regents of the University of the Philippines is performing functions similar to those of the Board of Trustees of a non-stock corporation. This draws to fore the conclusion that being a member of such board, accused-movant undoubtedly falls within the category of public officials upon whom this Court is vested with original exclusive jurisdiction, regardless of the fact that she does not occupy a position classified as Salary Grade 27 or higher under the Compensation and Position Classification Act of 1989.

Finally, this court finds that accused-movant’s contention that the same of P15 Million was received from former President Estrada and not from the coffers of the government, is a matter a defense that should be properly ventilated during the trial on the merits of this case.16

On November 19, 2003, petitioner filed a motion for reconsideration.17 The motion was denied with finality in a Resolution dated February 4, 2004.18

Issue

Petitioner is now before this Court, contending that "THE RESPONDENT COURT COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION IN NOT QUASHING THE INFORMATION AND DISMISING THE CASE NOTWITHSTANDING THAT IS HAS NO JURISDICTION OVER THE OFFENSE CHARGED IN THE INFORMATION."19

In her discussion, she reiterates her four-fold argument below, namely: (a) the Sandiganbayan has no jurisdiction over estafa; (b) petitioner is not a public officer with Salary Grade 27 and she paid her tuition fees; (c) the offense charged was not committed in relation to her office; (d) the funds in question personally came from President Estrada, not from the government.

Our Ruling

The petition cannot be granted.

Preliminarily, the denial of a motion toquash is not correctible by certiorari.

We would ordinarily dismiss this petition for certiorari outright on procedural grounds. Well-established is the rule that when a motion to quash in a criminal case is denied, the remedy is not a petition for certiorari, but for petitioners to go to trial, without prejudice to reiterating the special defenses invoked in their motion to quash.20Remedial measures as regards interlocutory orders, such as a motion to quash, are frowned upon and often dismissed.21 The evident reason for this rule is to avoid multiplicity of appeals in a single action.22

In Newsweek, Inc. v. Intermediate Appellate Court,23 the Court clearly explained and illustrated the rule and the exceptions, thus:

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As a general rule, an order denying a motion to dismiss is merely interlocutory and cannot be subject of appeal until final judgment or order is rendered. (Sec. 2 of Rule 41). The ordinary procedure to be followed in such a case is to file an answer, go to trial and if the decision is adverse, reiterate the issue on appeal from the final judgment. The same rule applies to an order denying a motion to quash, except that instead of filing an answer a plea is entered and no appeal lies from a judgment of acquittal.

This general rule is subject to certain exceptions. If the court, in denying the motion to dismiss or motion to quash, acts without or in excess of jurisdiction or with grave abuse of discretion, then certiorari or prohibition lies. The reason is that it would be unfair to require the defendant or accused to undergo the ordeal and expense of a trial if the court has no jurisdiction over the subject matter or offense, or is not the court of proper venue, or if the denial of the motion to dismiss or motion to quash is made with grave abuse of discretion or a whimsical and capricious exercise of judgment. In such cases, the ordinary remedy of appeal cannot be plain and adequate. The following are a few examples of the exceptions to the general rule.

In De Jesus v. Garcia (19 SCRA 554), upon the denial of a motion to dismiss based on lack of jurisdiction over the subject matter, this Court granted the petition for certiorari and prohibition against the City Court of Manila and directed the respondent court to dismiss the case.

In Lopez v. City Judge (18 SCRA 616), upon the denial of a motion to quash based on lack of jurisdiction over the offense, this Court granted the petition for prohibition and enjoined the respondent court from further proceeding in the case.

In Enriquez v. Macadaeg (84 Phil. 674), upon the denial of a motion to dismiss based on improper venue, this Court granted the petition for prohibition and enjoined the respondent judge from taking cognizance of the case except to dismiss the same.

In Manalo v. Mariano (69 SCRA 80), upon the denial of a motion to dismiss based on bar by prior judgment, this Court granted the petition for certiorari and directed the respondent judge to dismiss the case.

In Yuviengco v. Dacuycuy (105 SCRA 668), upon the denial of a motion to dismiss based on the Statute of Frauds, this Court granted the petition for certiorari and dismissed the amended complaint.

In Tacas v. Cariaso (72 SCRA 527), this Court granted the petition for certiorari after the motion to quash based on double jeopardy was denied by respondent judge and ordered him to desist from further action in the criminal case except to dismiss the same.

In People v. Ramos (83 SCRA 11), the order denying the motion to quash based on prescription was set aside on certiorari and the criminal case was dismissed by this Court.24

We do not find the Sandiganbayan to have committed a grave abuse of discretion.

The jurisdiction of the Sandiganbayan isset by P.D. No. 1606, as amended, not byR.A. No. 3019, as amended.

We first address petitioner’s contention that the jurisdiction of the Sandiganbayan is determined by Section 4 of R.A. No. 3019 (The Anti-Graft and Corrupt Practices Act, as amended). We note that petitioner refers to Section 4 of the said law yet quotes Section 4 of P.D. No. 1606, as amended, in her motion to quash before the Sandiganbayan.25 She repeats the reference in the instant petition for certiorari26 and in her memorandum of authorities.27

We cannot bring ourselves to write this off as a mere clerical or typographical error. It bears stressing that petitioner repeated this claim twice despite corrections made by the Sandiganbayan.28

Her claim has no basis in law. It is P.D. No. 1606, as amended, rather than R.A. No. 3019, as amended, that determines the jurisdiction of the Sandiganbayan. A brief legislative history of the statute creating the Sandiganbayan is in order. The Sandiganbayan was created by P.D. No. 1486, promulgated by then President Ferdinand E. Marcos on June 11, 1978. It was promulgated to attain the highest norms of official conduct required of public officers and employees, based on the concept that public officers and employees shall serve with the highest degree of responsibility, integrity, loyalty and efficiency and shall remain at all times accountable to the people.29

P.D. No. 1486 was, in turn, amended by P.D. No. 1606 which was promulgated on December 10, 1978. P.D. No. 1606 expanded the jurisdiction of the Sandiganbayan.30

P.D. No. 1606 was later amended by P.D. No. 1861 on March 23, 1983, further altering the Sandiganbayan jurisdiction. R.A. No. 7975 approved on March 30, 1995 made succeeding amendments to P.D. No. 1606, which was again amended on February 5, 1997 by R.A. No. 8249. Section 4 of R.A. No. 8249 further modified the jurisdiction of the Sandiganbayan. As it now stands, the Sandiganbayan has jurisdiction over the following:

Sec. 4. Jurisdiction. - The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving:

A. Violations of Republic Act No. 3019, as amended, other known as the Anti-Graft and Corrupt Practices Act, Republic Act No. 1379, and Chapter II, Section 2, Title VII, Book II of the Revised Penal Code, where one or more of the accused are officials occupying the following positions in the government, whether in a permanent, acting or interim capacity, at the time of the commission of the offense:

(1) Officials of the executive branch occupying the positions of regional director and higher, otherwise classified as Grade "27" and higher, of the Compensation and Position Classification Act of 989 (Republic Act No. 6758), specifically including:

" (a) Provincial governors, vice-governors, members of the sangguniang panlalawigan, and provincial treasurers, assessors, engineers, and other city department heads;

" (b) City mayor, vice-mayors, members of the sangguniang panlungsod, city treasurers, assessors, engineers, and other city department heads;

"(c ) Officials of the diplomatic service occupying the position of consul and higher;

" (d) Philippine army and air force colonels, naval captains, and all officers of higher rank;

" (e) Officers of the Philippine National Police while occupying the position of provincial director and those holding the rank of senior superintended or higher;

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" (f) City and provincial prosecutors and their assistants, and officials and prosecutors in the Office of the Ombudsman and special prosecutor;

" (g) Presidents, directors or trustees, or managers of government-owned or controlled corporations, state universities or educational institutions or foundations.

" (2) Members of Congress and officials thereof classified as Grade "27'" and up under the Compensation and Position Classification Act of 1989;

" (3) Members of the judiciary without prejudice to the provisions of the Constitution;

" (4) Chairmen and members of Constitutional Commission, without prejudice to the provisions of the Constitution; and

" (5) All other national and local officials classified as Grade "27'" and higher under the Compensation and Position Classification Act of 1989.

B. Other offenses of felonies whether simple or complexed with other crimes committed by the public officials and employees mentioned in subsection a of this section in relation to their office.

C. Civil and criminal cases filed pursuant to and in connection with Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986.

" 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 and PNP officer mentioned above, exclusive original jurisdiction thereof shall be vested in the proper regional 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 order of regional trial courts whether in the exercise of their own original jurisdiction or of their appellate jurisdiction as herein provided.

" The Sandiganbayan shall have 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 thereafter 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.

" Any provisions of law or Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liability shall, at all times, be simultaneously instituted with, and jointly determined in, the same proceeding by the Sandiganbayan or the appropriate courts, the filing of the criminal action being deemed to necessarily carry with it the filing of the civil action, and no right to reserve the filing such civil action separately from the criminal action shall be recognized: Provided, however, That where the civil action had heretofore been filed separately but judgment therein has not yet been rendered, and the criminal case is hereafter filed with the Sandiganbayan or the appropriate court, said civil action shall be transferred to the Sandiganbayan or the appropriate court, as the case may be, for consolidation and joint determination with the criminal action, otherwise the separate civil action shall be deemed abandoned."

Upon the other hand, R.A. No. 3019 is a penal statute approved on August 17, 1960. The said law represses certain acts of public officers and private persons alike which constitute graft or corrupt practices or which may lead thereto.31 Pursuant to Section 10 of R.A. No. 3019, all prosecutions for violation of the said law should be filed with the Sandiganbayan.32

R.A. No. 3019 does not contain an enumeration of the cases over which the Sandiganbayan has jurisdiction. In fact, Section 4 of R.A. No. 3019 erroneously cited by petitioner, deals not with the jurisdiction of the Sandiganbayan but with prohibition on private individuals. We quote:

Section 4. Prohibition on private individuals. – (a) It shall be unlawful for any person having family or close personal relation with any public official to capitalize or exploit or take advantage of such family or close personal relation by directly or indirectly requesting or receiving any present, gift or material or pecuniary advantage from any other person having some business, transaction, application, request or contract with the government, in which such public official has to intervene. Family relation shall include the spouse or relatives by consanguinity or affinity in the third civil degree. The word "close personal relation" shall include close personal friendship, social and fraternal connections, and professional employment all giving rise to intimacy which assures free access to such public officer.

(b) It shall be unlawful for any person knowingly to induce or cause any public official to commit any of the offenses defined in Section 3 hereof.

In fine, the two statutes differ in that P.D. No. 1606, as amended, defines the jurisdiction of the Sandiganbayan while R.A. No. 3019, as amended, defines graft and corrupt practices and provides for their penalties.

Sandiganbayan has jurisdiction overthe offense of estafa.

Relying on Section 4 of P.D. No. 1606, petitioner contends that estafa is not among those crimes cognizable by the Sandiganbayan. We note that in hoisting this argument, petitioner isolated the first paragraph of Section 4 of P.D. No. 1606, without regard to the succeeding paragraphs of the said provision.

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The rule is well-established in this jurisdiction that statutes should receive a sensible construction so as to avoid an unjust or an absurd conclusion.33 Interpretatio talis in ambiguis semper fienda est, ut evitetur inconveniens et absurdum. Where there is ambiguity, such interpretation as will avoid inconvenience and absurdity is to be adopted. Kung saan mayroong kalabuan, ang pagpapaliwanag ay hindi dapat maging mahirap at katawa-tawa.

Every section, provision or clause of the statute must be expounded by reference to each other in order to arrive at the effect contemplated by the legislature.34 The intention of the legislator must be ascertained from the whole text of the law and every part of the act is to be taken into view.35 In other words, petitioner’s interpretation lies in direct opposition to the rule that a statute must be interpreted as a whole under the principle that the best interpreter of a statute is the statute itself.36 Optima statuti interpretatrix est ipsum statutum. Ang isang batas ay marapat na bigyan ng kahulugan sa kanyang kabuuan sa ilalim ng prinsipyo na ang pinakamainam na interpretasyon ay ang mismong batas.

Section 4(B) of P.D. No. 1606 reads:

B. Other offenses or felonies whether simple or complexed with other crimes committed by the public officials and employees mentioned in subsection a of this section in relation to their office.

Evidently, the Sandiganbayan has jurisdiction over other felonies committed by public officials in relation to their office. We see no plausible or sensible reason to exclude estafa as one of the offenses included in Section 4(bB) of P.D. No. 1606. Plainly, estafa is one of those other felonies. The jurisdiction is simply subject to the twin requirements that (a) the offense is committed by public officials and employees mentioned in Section 4(A) of P.D. No. 1606, as amended, and that (b) the offense is committed in relation to their office.

In Perlas, Jr. v. People,37 the Court had occasion to explain that the Sandiganbayan has jurisdiction over an indictment for estafa versus a director of the National Parks Development Committee, a government instrumentality. The Court held then:

The National Parks Development Committee was created originally as an Executive Committee on January 14, 1963, for the development of the Quezon Memorial, Luneta and other national parks (Executive Order No. 30). It was later designated as the National Parks Development Committee (NPDC) on February 7, 1974

(E.O. No. 69). On January 9, 1966, Mrs. Imelda R. Marcos and Teodoro F. Valencia were designated Chairman and Vice-Chairman respectively (E.O. No. 3). Despite an attempt to transfer it to the Bureau of Forest Development, Department of Natural Resources, on December 1, 1975 (Letter of Implementation No. 39, issued pursuant to PD No. 830, dated November 27, 1975), the NPDC has remained under the Office of the President (E.O. No. 709, dated July 27, 1981).

Since 1977 to 1981, the annual appropriations decrees listed NPDC as a regular government agency under the Office of the President and allotments for its maintenance and operating expenses were issued direct to NPDC (Exh. 10-A, Perlas, Item Nos. 2, 3).

The Sandiganbayan’s jurisdiction over estafa was reiterated with greater firmness in Bondoc v. Sandiganbayan.38Pertinent parts of the Court’s ruling in Bondoc read:

Furthermore, it is not legally possible to transfer Bondoc’s cases to the Regional Trial Court, for the simple reason that the latter would not have jurisdiction over the offenses. As already above intimated, the inability of the Sandiganbayan to hold a joint trial of Bondoc’s cases and those of the government employees separately charged for the same crimes, has not altered the nature of the offenses charged, as estafa thru falsification punishable by penalties higher than prision correccional or imprisonment of six years, or a fine of P6,000.00, committed by government employees in conspiracy with private persons, including Bondoc. These crimes are within the exclusive, original jurisdiction of the Sandiganbayan. They simply cannot be taken cognizance of by the regular courts, apart from the fact that even if the cases could be so transferred, a joint trial would nonetheless not be possible.

Petitioner UP student regentis a public officer.

Petitioner also contends that she is not a public officer. She does not receive any salary or remuneration as a UP student regent. This is not the first or likely the last time that We will be called upon to define a public officer. InKhan, Jr. v. Office of the Ombudsman, We ruled that it is difficult to pin down the definition of a public officer.39The 1987 Constitution does not define who are public officers. Rather, the varied definitions and concepts are found in different statutes and jurisprudence.

In Aparri v. Court of Appeals,40 the Court held that:

A public office is the right, authority, and duty created and conferred by law, by which for a given period, either fixed by law or enduring at the pleasure of the creating power, an individual is invested with some portion of the sovereign functions of the government, to be exercise by him for the benefit of the public ([Mechem Public Offices and Officers,] Sec. 1). The right to hold a public office under our political system is therefore not a natural right. It exists, when it exists at all only because and by virtue of some law expressly or impliedly creating and conferring it (Mechem Ibid., Sec. 64). There is no such thing as a vested interest or an estate in an office, or even an absolute right to hold office. Excepting constitutional offices which provide for special immunity as regards salary and tenure, no one can be said to have any vested right in an office or its salary (42 Am. Jur. 881).

In Laurel v. Desierto,41 the Court adopted the definition of Mechem of a public office:

"A public office is the right, authority and duty, created and conferred by law, by which, for a given period, either fixed by law or enduring at the pleasure of the creating power, an individual is invested with some portion of the sovereign functions of the government, to be exercised by him for the benefit of the public. The individual so invested is a public officer."42

Petitioner claims that she is not a public officer with Salary Grade 27; she is, in fact, a regular tuition fee-paying student. This is likewise bereft of merit. It is not only the salary grade that determines the jurisdiction of the Sandiganbayan. The Sandiganbayan also has jurisdiction over other officers enumerated in P.D. No. 1606. InGeduspan v. People,43 We held that while the first part of Section 4(A) covers only officials with Salary Grade 27 and higher, its second part specifically includes other executive officials whose positions may not be of Salary Grade 27 and higher but who are by express provision of law placed under the jurisdiction of the said court. Petitioner falls under the jurisdiction of the Sandiganbayan as she is placed there by express provision of law.44

Section 4(A)(1)(g) of P.D. No. 1606 explictly vested the Sandiganbayan with jurisdiction over Presidents, directors or trustees, or managers of government-owned or controlled corporations, state universities or educational institutions or foundations. Petitioner falls under this category. As the

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Sandiganbayan pointed out, the BOR performs functions similar to those of a board of trustees of a non-stock corporation.45 By express mandate of law, petitioner is, indeed, a public officer as contemplated by P.D. No. 1606.

Moreover, it is well established that compensation is not an essential element of public office.46 At most, it is merely incidental to the public office.47

Delegation of sovereign functions is essential in the public office. An investment in an individual of some portion of the sovereign functions of the government, to be exercised by him for the benefit of the public makes one a public officer.48

The administration of the UP is a sovereign function in line with Article XIV of the Constitution. UP performs a legitimate governmental function by providing advanced instruction in literature, philosophy, the sciences, and arts, and giving professional and technical training.49 Moreover, UP is maintained by the Government and it declares no dividends and is not a corporation created for profit.50

The offense charged was committedin relation to public office, accordingto the Information.

Petitioner likewise argues that even assuming that she is a public officer, the Sandiganbayan would still not have jurisdiction over the offense because it was not committed in relation to her office.

According to petitioner, she had no power or authority to act without the approval of the BOR. She adds there was no Board Resolution issued by the BOR authorizing her to contract with then President Estrada; and that her acts were not ratified by the governing body of the state university. Resultantly, her act was done in a private capacity and not in relation to public office.

It is axiomatic that jurisdiction is determined by the averments in the information.51 More than that, jurisdiction is not affected by the pleas or the theories set up by defendant or respondent in an answer, a motion to dismiss, or a motion to quash.52 Otherwise, jurisdiction would become dependent almost entirely upon the whims of defendant or respondent.53

In the case at bench, the information alleged, in no uncertain terms that petitioner, being then a student regent of U.P., "while in the performance of her official functions, committing the offense in relation to her office and taking advantage of her position, with intent to gain, conspiring with her brother, JADE IAN D. SERANA,

a private individual, did then and there wilfully, unlawfully and feloniously defraud the government x x x." (Underscoring supplied)

Clearly, there was no grave abuse of discretion on the part of the Sandiganbayan when it did not quash the information based on this ground.

Source of funds is a defense that shouldbe raised during trial on the merits.

It is contended anew that the amount came from President Estrada’s private funds and not from the government coffers. Petitioner insists the charge has no leg to stand on.

We cannot agree. The information alleges that the funds came from the Office of the President and not its then occupant, President Joseph Ejercito Estrada. Under the information, it is averred that "petitioner requested the amount of Fifteen Million Pesos (P15,000,000.00), Philippine Currency, from the Office of the President, and the latter relying and believing on said false pretenses and misrepresentation gave and delivered to said accused Land Bank Check No. 91353 dated October 24, 2000 in the amount of Fifteen Million Pesos (P15,000,000.00)."

Again, the Court sustains the Sandiganbayan observation that the source of the P15,000,000 is a matter of defense that should be ventilated during the trial on the merits of the instant case.54

A lawyer owes candor, fairnessand honesty to the Court.

As a parting note, petitioner’s counsel, Renato G. dela Cruz, misrepresented his reference to Section 4 of P.D. No. 1606 as a quotation from Section 4 of R.A. No. 3019. A review of his motion to quash, the instant petition forcertiorari and his memorandum, unveils the misquotation. We urge petitioner’s counsel to observe Canon 10 of the Code of Professional Responsibility, specifically Rule 10.02 of the Rules stating that "a lawyer shall not misquote or misrepresent."

The Court stressed the importance of this rule in Pangan v. Ramos,55 where Atty Dionisio D. Ramos used the name Pedro D.D. Ramos in connection with a criminal case. The Court ruled that Atty. Ramos resorted to deception by using a name different from that with which he was authorized. We severely reprimanded Atty. Ramos and warned that a repetition may warrant suspension or disbarment.56

We admonish petitioner’s counsel to be more careful and accurate in his citation. A lawyer’s conduct before the court should be characterized by candor and fairness.57 The administration of justice would gravely suffer if lawyers do not act with complete candor and honesty before the courts.58

WHEREFORE, the petition is DENIED for lack of merit.

SO ORDERED.

Ynares-Santiago, Chairperson, Austria-Martinez, Corona*, Nachura, JJ., concur.

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G.R. No. 198755               June 5, 2013

ALBERTO PAT-OG, SR., Petitioner, vs.CIVIL SERVICE COMMISSION, Respondent.

D E C I S I O N

MENDOZA, J.:

Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, which seeks to set aside the April 6, 2011 Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 101700, affirming the April 11, 2007 Decision2 of the Civil Service Commission (CSC), which ordered the dismissal of petitioner Alberto Pat-og, Sr. (Pat-og) from the service for grave misconduct.

The Facts

On September 13, 2003, Robert Bang-on (Bang-on), then a 14-year old second year high school student of the Antadao National High School in Sagada, Mountain Province, tiled an affidavit-complaint against Pat-og, a third year high school teacher of the same school, before the Civil Service Commission-Cordillera Administrative Region (CSC-CAR).

Bang-on alleged that on the morning of August 26, 2003, he attended his class at the basketball court of the school, where Pat-og and his third year students were also holding a separate class; that he and some of his classmates joined Pat-og’s third year students who were practicing basketball shots; that Pat-og later instructed them to form two lines; that thinking that three lines were to be formed, he stayed in between the two lines; that Pat-og then held his right arm and punched his stomach without warning for failing to follow instructions; and that as a result, he suffered stomach pain for several days and was confined in a hospital from September 10-12, 2003, as evidenced by a medico-legal certificate, which stated that he sustained a contusion hematoma in the hypogastric area.

Regarding the same incident, Bang-on filed a criminal case against Pat-og for the crime of Less Serious Physical Injury with the Regional Trial Court (RTC) of Bontoc, Mountain Province.

Taking cognizance of the administrative case, the CSC-CAR directed Pat-og to file his counter-affidavit. He denied the charges hurled against him and claimed that when he was conducting his

Music, Arts, Physical Education and Health (MAPEH) class, composed of third year students, he instructed the girls to play volleyball and the boys to play basketball; that he later directed the boys to form two lines; that after the boys failed to follow his repeated instructions, he scolded them in a loud voice and wrested the ball from them; that while approaching them, he noticed that there were male students who were not members of his class who had joined the shooting practice; that one of those male students was Bang-on, who was supposed to be having his own MAPEH class under another teacher; that he then glared at them, continued scolding them and dismissed the class for their failure to follow instructions; and that he offered the sworn statement of other students to prove that he did not box Bang-on.

On June 1, 2004, the CSC-CAR found the existence of a prima faciecase for misconduct and formally charged Pat-og.

While the proceedings of the administrative case were ongoing, the RTC rendered its judgment in the criminal case and found Pat-og guilty of the offense of slight physical injury. He was meted the penalty of imprisonment from eleven (11) to twenty (20) days. Following his application for probation, the decision became final and executory and judgment was entered.

Meanwhile, in the administrative case, a pre-hearing conference was conducted after repeated postponement by Pat-og. With the approval of the CSC-CAR, the prosecution submitted its position paper in lieu of a formal presentation of evidence and formally offered its evidence, which included the decision in the criminal case. It offered the affidavits of Raymund Atuban, a classmate of Bang-on; and James Domanog, a third year high school student, who both witnessed Pat-og hit Bang-on in the stomach.

For his defense, Pat-og offered the testimonies of his witnesses - Emiliano Dontongan (Dontongan), a teacher in another school, who alleged that he was a member of the Municipal Council for the Protection of Children, and that, in such capacity, he investigated the incident and came to the conclusion that it did not happen at all; and Ernest Kimmot, who testified that he was in the basketball court at the time but did not see such incident. Pat-og also presented the affidavits of thirteen other witnesses to prove that he did not punch Bang-on.

Ruling of the CSC-CAR

In its Decision,3 dated September 19, 2006, the CSC-CAR found Pat-og guilty and disposed as follows:

WHEREFORE, all premises told, respondent Alberto Pat-og, Sr., Teacher Antadao National High School, is hereby found guilty of Simple Misconduct.

Under the Uniform Rules on Administrative Cases in the Civil Service, the imposable penalty on the first offense of Simple Misconduct is suspension of one (1) month and one (1) day to six (6) months.

Due to seriousness of the resulting injury to the fragile body of the minor victim, the CSC-CAR hereby imposed upon respondent the maximum penalty attached to the offense which is six months suspension without pay.

The CSC-CAR gave greater weight to the version posited by the prosecution, finding that a blow was indeed inflicted by Pat-og on Bang-on. It found that Pat-og had a motive for doing so - his students’ failure to follow his repeated instructions which angered him. Nevertheless, the CSCCAR ruled that a motive was not necessary to establish guilt if the perpetrator of the offense was positively identified. The positive identification of Pat-og was duly proven by the corroborative testimonies of the prosecution witnesses, who were found to be credible and disinterested. The testimony of defense witness, Dontongan, was not given credence considering that the students he interviewed for his investigation claimed that Pat-og was not even angry at the time of the incident, contrary to the latter’s own admission.

The CSC-CAR held that the actions of Pat-og clearly transgressed the proper norms of conduct required of a public official, and the gravity of the offense was further magnified by the seriousness of the injury of Bang-on which required a healing period of more than ten (10) days. It pointed out that, being his teacher, Pat-og’s substitute parental authority did not give him license to physically chastise a misbehaving student. The CSC-CAR added that the fact that Pat-og applied for probation in the criminal case, instead of filing an appeal, further convinced it of his guilt.

The CSC-CAR believed that the act committed by Pat-og was sufficient to find him guilty of Grave Misconduct. It, however, found the corresponding penalty of dismissal from the service too harsh under the circumstances. Thus, it adjudged petitioner guilty of Simple Misconduct and imposed the maximum penalty of suspension for six (6) months.

On December 11, 2006, the motion for reconsideration filed by Pat-og was denied for lack of merit.4

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The Ruling of the CSC

In its Resolution,5 dated April 11, 2007, the CSC dismissed Pat-og’s appeal and affirmed with modification the decision of the CSC-CAR as follows:

WHEREFORE, foregoing premises considered, the instant appeal is hereby DISMISSED. The decision of the CSC-CAR is affirmed with the modification that Alberto Pat-og, Sr., is adjudged guilty of grave misconduct, for which he is meted out the penalty of dismissal from the service with all its accessory penalties of cancellation of eligibilities, perpetual disqualification from reemployment in the government service, and forfeiture of retirement benefits.6

After evaluating the records, the CSC sustained the CSC-CAR’s conclusion that there existed substantial evidence to sustain the finding that Pat-og did punch Bang-on in the stomach. It gave greater weight to the positive statements of Bang-on and his witnesses over the bare denial of Patog. It also highlighted the fact that Pat-og failed to adduce evidence of any ill motive on the part of Bang-on in filing the administrative case against him. It likewise gave credence to the medico-legal certificate showing that Bang-on suffered a hematoma contusion in his hypogastric area.

The CSC ruled that the affidavits of Bang-on’s witnesses were not bereft of evidentiary value even if Pat-og was not afforded a chance to cross-examine the witnesses of Bang-on. It is of no moment because the cross- examination of witnesses is not an indispensable requirement of administrative due process.

The CSC noted that Pat-og did not question but, instead, fully acquiesced in his conviction in the criminal case for slight physical injury, which was based on the same set of facts and circumstances, and involved the same parties and issues. It, thus, considered his prior criminal conviction as evidence against him in the administrative case.

Finding that his act of punching his student displayed a flagrant and wanton disregard of the dignity of a person, reminiscent of corporal punishment that had since been outlawed for being harsh, unjust, and cruel, the CSC upgraded Pat-og’s offense from Simple Misconduct to Grave Misconduct and ordered his dismissal from the service.

Pat-og filed a motion for reconsideration, questioning for the first time the jurisdiction of CSC over the case. He contended that administrative charges against a public school teacher should

have been initially heard by a committee to be constituted pursuant to the Magna Carta for Public School Teachers.

On November 5, 2007, the CSC denied his motion for reconsideration.7 It ruled that Pat-og was estopped from challenging its jurisdiction considering that he actively participated in the administrative proceedings against him, raising the issue of jurisdiction only after his appeal was dismissed by the CSC.

Ruling of the Court of Appeals

In its assailed April 6, 2011 Decision,8 the CA affirmed the resolutions of the CSC. It agreed that Pat-og was estopped from questioning the jurisdiction of the CSC as the records clearly showed that he actively participated in the proceedings. It was of the view that Pat-og was not denied due process when he failed to cross-examine Bang-on and his witnesses because he was given the opportunity to be heard and present his evidence before the CSC-CAR and the CSC.

The CA also held that the CSC committed no error in taking into account the conviction of Pat-og in the criminal case. It stated that his conviction was not the sole basis of the CSC for his dismissal from the service because there was substantial evidence proving that Pat-og had indeed hit Bang-on.

In its assailed Resolution,9 dated September 13, 2011, the CA denied the motion for reconsideration filed by Pat-og.

Hence, the present petition with the following

Assignment of Errors

WHETHER OR NOT RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT AFFIRMED THE SUPREME PENALTY OF DISMISSAL FROM SERVICE WITH FORFEITURE OF RETIREMENT BENEFITS AGAINST THE PETITIONER WITHOUT CONSIDERING PETITIONER’S LONG YEARS OF GOVERNMENT SERVICE?

WHETHER OR NOT RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT RULED THAT PETITIONER IS ESTOPPED FROM QUESTIONING THE JURISDICTION OF THE CIVIL SERVICE COMMISSION TO HEAR AND DECIDE THE ADMINISTRATIVE CASE AGAINST HIM?

WHETHER OR NOT RESPONDENT COURT OF APPEALS SERIOUSLY ERRED AND COMMITTED GRAVE ABUSE OF DISCRETION IN DISMISSING THE APPEAL DESPITE LACK OF SUBSTANTIAL EVIDENCE?

On Jurisdiction

Pat-og contends that Section 9 of Republic Act (R.A.) No. 4670, otherwise known as the Magna Carta for Public School Teachers, provides that administrative charges against a public school teacher shall be heard initially by a committee constituted under said section. As no committee was ever formed, the petitioner posits that he was denied due process and that the CSC did not have the jurisdiction to hear and decide his administrative case. He further argues that notwithstanding the fact that the issue of jurisdiction was raised for the first time on appeal, the rule remains that estoppel does not confer jurisdiction on a tribunal that has no jurisdiction over the cause of action or subject matter of the case.

The Court cannot sustain his position.

The petitioner’s argument that the administrative case against him can only proceed under R.A. No. 4670 is misplaced.

In Puse v. Santos-Puse,10 it was held that the CSC, the Department of Education (DepEd) and the Board of Professional Teachers-Professional Regulatory Commission (PRC) have concurrent jurisdiction over administrative cases against public school teachers.

Under Article IX-B of the 1987 Constitution, the CSC is the body charged with the establishment and administration of a career civil service which embraces all branches and agencies of the government.11 Executive Order (E.O.) No. 292 (the Administrative Code of 1987)12 and Presidential Decree (P.D.) No. 807 (the Civil Service Decree of the Philippines)13 expressly provide that the CSC has the power to hear and decide administrative disciplinary cases instituted with it or brought to it on appeal. Thus, the CSC, as the central personnel agency of the government, has the inherent power to supervise and discipline all members of the civil service, including public school teachers.

Indeed, under Section 9 of R.A. No. 4670, the jurisdiction over administrative cases of public school teachers is lodged with the investigating committee constituted therein.14 Also, under Section 23 of R.A. No. 7836 (the Philippine Teachers Professionalization Act of 1994), the Board of Professional Teachers is given the power, after due notice and hearing, to suspend or revoke the

Page 44: Jurisdiction -- Rem

certificate of registration of a professional teacher for causes enumerated therein.15

Concurrent jurisdiction is that which is possessed over the same parties or subject matter at the same time by two or more separate tribunals. When the law bestows upon a government body the jurisdiction to hear and decide cases involving specific matters, it is to be presumed that such jurisdiction is exclusive unless it be proved that another body is likewise vested with the same jurisdiction, in which case, both bodies have concurrent jurisdiction over the matter.16

Where concurrent jurisdiction exists in several tribunals, the body that first takes cognizance of the complaint shall exercise jurisdiction to the exclusion of the others. In this case, it was CSC which first acquired jurisdiction over the case because the complaint was filed before it. Thus, it had the authority to proceed and decide the case to the exclusion of the DepEd and the Board of Professional Teachers.17

In CSC v. Alfonso,18 it was held that special laws, such as R.A. No. 4670, do not divest the CSC of its inherent power to supervise and discipline all members of the civil service, including public school teachers. Pat-og, as a public school teacher, is first and foremost, a civil servant accountable to the people and answerable to the CSC for complaints lodged against him as a public servant. To hold that R.A. No. 4670 divests the CSC of its power to discipline public school teachers would negate the very purpose for which the CSC was established and would impliedly amend the Constitution itself.

To further drive home the point, it was ruled in CSC v. Macud19 that R.A. No. 4670, in imposing a separate set of procedural requirements in connection with administrative proceedings against public school teachers, should be construed to refer only to the specific procedure to be followed in administrative investigations conducted by the DepEd. By no means, then, did R.A. No. 4670 confer an exclusive disciplinary authority over public school teachers on the DepEd.

At any rate, granting that the CSC was without jurisdiction, the petitioner is indeed estopped from raising the issue. Although the rule states that a jurisdictional question may be raised at any time, such rule admits of the exception where, as in this case, estoppel has supervened.20 Here, instead of opposing the CSC’s exercise of jurisdiction, the petitioner invoked the same by actively participating in the proceedings before the CSC-CAR and by even filing his appeal before the CSC itself; only raising the issue of jurisdiction later in his motion for reconsideration after the CSC denied his appeal. This Court has time and again frowned upon

the undesirable practice of a party submitting his case for decision and then accepting the judgment only if favorable, but attacking it for lack of jurisdiction when adverse.21

On Administrative Due Process

On due process, Pat-og asserts that the affidavits of the complainant and his witnesses are of questionable veracity having been subscribed in Bontoc, which is nearly 30 kilometers from the residences of the parties. Furthermore, he claimed that considering that the said affiants never testified, he was never afforded the opportunity to cross-examine them. Therefore, their affidavits were mere hearsay and insufficient to prove his guilt.

The petitioner does not persuade.

The essence of due process is simply to be heard, or as applied to administrative proceedings, a fair and reasonable opportunity to explain one’s side, or an opportunity to seek a reconsideration of the action or ruling complained of.22 Administrative due process cannot be fully equated with due process in its strict judicial sense. In administrative proceedings, a formal or trial-type hearing is not always necessary23 and technical rules of procedure are not strictly applied. Hence, the right to cross-examine is not an indispensable aspect of administrative due process.24 The petitioner cannot, therefore, argue that the affidavit of Bang-on and his witnesses are hearsay and insufficient to prove his guilt.

At any rate, having actively participated in the proceedings before the CSC-CAR, the CSC, and the CA, the petitioner was apparently afforded every opportunity to explain his side and seek reconsideration of the ruling against him.1âwphi1

As to the issue of the veracity of the affidavits, such is a question of fact which cannot now be raised before the Court under Rule 45 of the Rules of Court. The CSC-CAR, the CSC and the CA did not, therefore, err in giving credence to the affidavits of the complainants and his witnesses, and in consequently ruling that there was substantial evidence to support the finding of misconduct on the part of the petitioner.

On the Penalty

Assuming that he did box Bang-on, Pat-og argues that there is no substantial evidence to prove that he did so with a clear intent to violate the law or in flagrant disregard of the established rule, as required for a finding of grave misconduct. He insists that he was not motivated by bad faith or ill will because he acted in the belief that, as a teacher, he was exercising authority over Bang-on in

loco parentis, and was, accordingly, within his rights to discipline his student. Citing his 33 years in the government service without any adverse record against him and the fact that he is at the edge of retirement, being already 62 years old, the petitioner prays that, in the name of substantial and compassionate justice, the CSC-CAR’s finding of simple misconduct and the concomitant penalty of suspension should be upheld, instead of dismissal.

The Court agrees in part.

Misconduct means intentional wrongdoing or deliberate violation of a rule of law or standard of behavior. To constitute an administrative offense, misconduct should relate to or be connected with the performance of the official functions and duties of a public officer. In grave misconduct, as distinguished from simple misconduct, the elements of corruption, clear intent to violate the law or t1agrant disregard of an established rule must be manifest.25

Teachers are duly licensed professionals who must not only be competent in the practice of their noble profession, but must also possess dignity and a reputation with high moral values. They must strictly adhere to, observe, and practice the set of ethical and moral principles, standards, and values laid down in the Code of Ethics of Professional Teachers, which apply to all teachers in schools in the Philippines, whether public or private, as provided in the preamble of the said Code.26 Section 8 of Article VIII of the same Code expressly provides that "a teacher shall not inflict corporal punishment on offending learners."

Clearly then, petitioner cannot argue that in punching Bang-on, he was exercising his right as a teacher in loco parentis to discipline his student. It is beyond cavil that the petitioner, as a public school teacher, deliberately violated his Code of Ethics. Such violation is a flagrant disregard for the established rule contained in the said Code tantamount to grave misconduct.

Under Section 52(A)(2) of Rule IV of the Uniform Rules on Administrative Cases in the Civil Service, the penalty for grave misconduct is dismissal from the service, which carries with it the cancellation of eligibility, forfeiture of retirement benefits and perpetual disqualification from reemployment in the government service.27 This penalty must, however, be tempered with compassion as there was sut1icient provocation on the part of Bang-on. Considering further the mitigating circumstances that the petitioner has been in the government service for 33 years, that this is his first offense and that he is at the cusp of retirement, the Court finds the penalty of suspension for six months as appropriate under the circumstances.

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WHEREFORE, the Court PARTIALLY GRANTS the petition and MODIFIES the April 6, 2011 Decision of the Court of Appeals in CA-G.R. SP No. 101700. Accordingly, Alberto Pat-og, Sr. is found GUlLTY of Grave Misconduct, but the penalty is reduced from dismissal from the service to SUSPENSION for SIX MONTHS.

SO ORDERED.

JOSE CATRAL MENDOZAAssociate Justice

G.R. No. 173946               June 19, 2013

BOSTON EQUITY RESOURCES, INC., Petitioner, vs.COURT OF APPEALS AND LOLITA G. TOLEDO, Respondents.

D E C I S I O N

PEREZ, J.:

Before the Court is a Petition for Review on Certiorari seeking to reverse and set aside: (1) the Decision,1 dated 28 February 2006 and (2) the Resolution,2 dated 1 August 2006 of the Court of Appeals in CA-G.R. SP No. 88586. The challenged decision granted herein respondent's petition for certiorari upon a finding that the trial court committed grave abuse of discretion in denying respondent's motion to dismiss the complaint against her.3Based on this finding, the Court of Appeals reversed and set aside the Orders, dated 8 November 20044 and 22 December 2004,5 respectively, of the Regional Trial Court (RTC) of Manila, Branch 24.

The Facts

On 24 December 1997, petitioner filed a complaint for sum of money with a prayer for the issuance of a writ of preliminary attachment against the spouses Manuel and Lolita Toledo.6 Herein respondent filed an Answer dated 19 March 1998 but on 7 May 1998, she filed a Motion for Leave to Admit Amended Answer7 in which she alleged, among others, that her husband and co-defendant, Manuel Toledo (Manuel), is already dead.8 The death certificate9 of Manuel states "13 July 1995" as the date of death. As a result, petitioner filed a motion, dated 5 August 1999, to require respondent to disclose the heirs of Manuel.10 In compliance with the verbal order of the court during the 11 October 1999 hearing of the case, respondent submitted the required names and addresses of the heirs.11 Petitioner then filed a Motion for Substitution,12 dated 18 January 2000, praying

that Manuel be substituted by his children as party-defendants. It appears that this motion was granted by the trial court in an Order dated 9 October 2000.13

Pre-trial thereafter ensued and on 18 July 2001, the trial court issued its pre-trial order containing, among others, the dates of hearing of the case.14

The trial of the case then proceeded. Herein petitioner, as plaintiff, presented its evidence and its exhibits were thereafter admitted.

On 26 May 2004, the reception of evidence for herein respondent was cancelled upon agreement of the parties. On 24 September 2004, counsel for herein respondent was given a period of fifteen days within which to file a demurrer to evidence.15 However, on 7 October 2004, respondent instead filed a motion to dismiss the complaint, citing the following as grounds: (1) that the complaint failed to implead an indispensable party or a real party in interest; hence, the case must be dismissed for failure to state a cause of action; (2) that the trial court did not acquire jurisdiction over the person of Manuel pursuant to Section 5, Rule 86 of the Revised Rules of Court; (3) that the trial court erred in ordering the substitution of the deceased Manuel by his heirs; and (4) that the court must also dismiss the case against Lolita Toledo in accordance with Section 6, Rule 86 of the Rules of Court.16

The trial court, in an Order dated 8 November 2004, denied the motion to dismiss for having been filed out of time, citing Section 1, Rule 16 of the 1997 Rules of Court which states that: "Within the time for but before filing the answer to the complaint or pleading asserting a claim, a motion to dismiss may be made x x x."17Respondent’s motion for reconsideration of the order of denial was likewise denied on the ground that "defendants’ attack on the jurisdiction of this Court is now barred by estoppel by laches" since respondent failed to raise the issue despite several chances to do so.18

Aggrieved, respondent filed a petition for certiorari with the Court of Appeals alleging that the trial court seriously erred and gravely abused its discretion in denying her motion to dismiss despite discovery, during the trial of the case, of evidence that would constitute a ground for dismissal of the case.19

The Court of Appeals granted the petition based on the following grounds:

It is elementary that courts acquire jurisdiction over the person of the defendant x x x only when the latter voluntarily appeared or submitted to the court or by coercive process issued by the court

to him, x x x. In this case, it is undisputed that when petitioner Boston filed the complaint on December 24, 1997, defendant Manuel S. Toledo was already dead, x x x. Such being the case, the court a quo could not have acquired jurisdiction over the person of defendant Manuel S. Toledo.

x x x the court a quo’s denial of respondent’s motion to dismiss was based on its finding that respondent’s attack on the jurisdiction of the court was already barred by laches as respondent failed to raise the said ground in its [sic] amended answer and during the pre-trial, despite her active participation in the proceedings.

However, x x x it is well-settled that issue on jurisdiction may be raised at any stage of the proceeding, even for the first time on appeal. By timely raising the issue on jurisdiction in her motion to dismiss x x x respondent is not estopped from raising the question on jurisdiction.

Moreover, when issue on jurisdiction was raised by respondent, the court a quo had not yet decided the case, hence, there is no basis for the court a quo to invoke estoppel to justify its denial of the motion for reconsideration;

It should be stressed that when the complaint was filed, defendant Manuel S. Toledo was already dead. The complaint should have impleaded the estate of Manuel S. Toledo as defendant, not only the wife, considering that the estate of Manuel S. Toledo is an indispensable party, which stands to be benefited or be injured in the outcome of the case. x x x

x x x x

Respondent’s motion to dismiss the complaint should have been granted by public respondent judge as the same was in order. Considering that the obligation of Manuel S. Toledo is solidary with another debtor, x x x, the claim x x x should be filed against the estate of Manuel S. Toledo, in conformity with the provision of Section 6, Rule 86 of the Rules of Court, x x x.20

The Court of Appeals denied petitioner’s motion for reconsideration. Hence, this petition.

The Issues

Petitioner claims that the Court of Appeals erred in not holding that:

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1. Respondent is already estopped from questioning the trial court’s jurisdiction;

2. Petitioner never failed to implead an indispensable party as the estate of Manuel is not an indispensable party;

3. The inclusion of Manuel as party-defendant is a mere misjoinder of party not warranting the dismissal of the case before the lower court; and

4. Since the estate of Manuel is not an indispensable party, it is not necessary that petitioner file its claim against the estate of Manuel.

In essence, what is at issue here is the correctness of the trial court’s orders denying respondent’s motion to dismiss.

The Ruling of the Court

We find merit in the petition.

Motion to dismiss filed out of time

To begin with, the Court of Appeals erred in granting the writ of certiorari in favor of respondent. Well settled is the rule that the special civil action for certiorari is not the proper remedy to assail the denial by the trial court of a motion to dismiss. The order of the trial court denying a motion to dismiss is merely interlocutory, as it neither terminates nor finally disposes of a case and still leaves something to be done by the court before a case is finally decided on the merits.21 Therefore, "the proper remedy in such a case is to appeal after a decision has been rendered."22

As the Supreme Court held in Indiana Aerospace University v. Comm. on Higher Education:23

A writ of certiorari is not intended to correct every controversial interlocutory ruling; it is resorted only to correct a grave abuse of discretion or a whimsical exercise of judgment equivalent to lack of jurisdiction. Its function is limited to keeping an inferior court within its jurisdiction and to relieve persons from arbitrary acts – acts which courts or judges have no power or authority in law to perform. It is not designed to correct erroneous findings and conclusions made by the courts. (Emphasis supplied)

Even assuming that certiorari is the proper remedy, the trial court did not commit grave abuse of discretion in denying respondent’s

motion to dismiss. It, in fact, acted correctly when it issued the questioned orders as respondent’s motion to dismiss was filed SIX YEARS AND FIVE MONTHS AFTER SHE FILED HER AMENDED ANSWER. This circumstance alone already warranted the outright dismissal of the motion for having been filed in clear contravention of the express mandate of Section 1, Rule 16, of the Revised Rules of Court. Under this provision, a motion to dismiss shall be filed within the time for but before the filing of an answer to the complaint or pleading asserting a claim.24

More importantly, respondent’s motion to dismiss was filed after petitioner has completed the presentation of its evidence in the trial court, giving credence to petitioner’s and the trial court’s conclusion that the filing of the motion to dismiss was a mere ploy on the part of respondent to delay the prompt resolution of the case against her.

Also worth mentioning is the fact that respondent’s motion to dismiss under consideration herein is not the first motion to dismiss she filed in the trial court. It appears that she had filed an earlier motion to dismiss26 on the sole ground of the unenforceability of petitioner’s claim under the Statute of Frauds, which motion was denied by the trial court. More telling is the following narration of the trial court in its Order denying respondent’s motion for reconsideration of the denial of her motion to dismiss:

As can be gleaned from the records, with the admission of plaintiff’s exhibits, reception of defendants’ evidence was set on March 31, and April 23, 2004 x x x . On motion of the defendants, the hearing on March 31, 2004 was cancelled.

On April 14, 2004, defendants sought the issuance of subpoena ad testificandum and duces tecum to one Gina M. Madulid, to appear and testify for the defendants on April 23, 2004. Reception of defendants’ evidence was again deferred to May 26, June 2 and June 30, 2004, x x x.

On May 13, 2004, defendants sought again the issuance of a subpoena duces tecum and ad testificandum to the said Gina Madulid. On May 26, 2004, reception of defendants [sic] evidence was cancelled upon the agreement of the parties. On July 28, 2004, in the absence of defendants’ witness, hearing was reset to September 24 and October 8, 2004 x x x.

On September 24, 2004, counsel for defendants was given a period of fifteen (15) days to file a demurrer to evidence. On October 7, 2004, defendants filed instead a Motion to Dismiss x x x.27

Respondent’s act of filing multiple motions, such as the first and earlier motion to dismiss and then the motion to dismiss at issue here, as well as several motions for postponement, lends credibility to the position taken by petitioner, which is shared by the trial court, that respondent is

deliberately impeding the early disposition of this case. The filing of the second motion to dismiss was, therefore, "not only improper but also dilatory."28 Thus, the trial court, "far from deviating or straying off course from established jurisprudence on the matter, x x x had in fact faithfully observed the law and legal precedents in this case."29 The Court of Appeals, therefore, erred not only in entertaining respondent’s petition for certiorari, it likewise erred in ruling that the trial court committed grave abuse of discretion when it denied respondent’s motion to dismiss.

On whether or not respondent is estopped fromquestioning the jurisdiction of the trial court

At the outset, it must be here stated that, as the succeeding discussions will demonstrate, jurisdiction over the person of Manuel should not be an issue in this case. A protracted discourse on jurisdiction is, nevertheless, demanded by the fact that jurisdiction has been raised as an issue from the lower court, to the Court of Appeals and, finally, before this Court. For the sake of clarity, and in order to finally settle the controversy and fully dispose of all the issues in this case, it was deemed imperative to resolve the issue of jurisdiction.

1. Aspects of Jurisdiction

Petitioner calls attention to the fact that respondent’s motion to dismiss questioning the trial court’s jurisdiction was filed more than six years after her amended answer was filed. According to petitioner, respondent had several opportunities, at various stages of the proceedings, to assail the trial court’s jurisdiction but never did so for six straight years. Citing the doctrine laid down in the case of Tijam, et al. v. Sibonghanoy, et al.30 petitioner claimed that respondent’s failure to raise the question of jurisdiction at an earlier stage bars her from later questioning it, especially since she actively participated in the proceedings conducted by the trial court.

Petitioner’s argument is misplaced, in that, it failed to consider that the concept of jurisdiction has several aspects, namely: (1) jurisdiction over the subject matter; (2) jurisdiction over the parties; (3) jurisdiction over the issues of the case; and (4) in cases involving property, jurisdiction over the res or the thing which is the subject of the litigation.31

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The aspect of jurisdiction which may be barred from being assailed as a result of estoppel by laches is jurisdiction over the subject matter. Thus, in Tijam, the case relied upon by petitioner, the issue involved was the authority of the then Court of First Instance to hear a case for the collection of a sum of money in the amount of P1,908.00 which amount was, at that time, within the exclusive original jurisdiction of the municipal courts.

In subsequent cases citing the ruling of the Court in Tijam, what was likewise at issue was the jurisdiction of the trial court over the subject matter of the case. Accordingly, in Spouses Gonzaga v. Court of Appeals,32 the issue for consideration was the authority of the regional trial court to hear and decide an action for reformation of contract and damages involving a subdivision lot, it being argued therein that jurisdiction is vested in the Housing and Land Use Regulatory Board pursuant to PD 957 (The Subdivision and Condominium Buyers Protective Decree). In Lee v. Presiding Judge, MTC, Legaspi City,33 petitioners argued that the respondent municipal trial court had no jurisdiction over the complaint for ejectment because the issue of ownership was raised in the pleadings. Finally, in People v. Casuga,34 accused-appellant claimed that the crime of grave slander, of which she was charged, falls within the concurrent jurisdiction of municipal courts or city courts and the then courts of first instance, and that the judgment of the court of first instance, to which she had appealed the municipal court's conviction, should be deemed null and void for want of jurisdiction as her appeal should have been filed with the Court of Appeals or the Supreme Court.

In all of these cases, the Supreme Court barred the attack on the jurisdiction of the respective courts concerned over the subject matter of the case based on estoppel by laches, declaring that parties cannot be allowed to belatedly adopt an inconsistent posture by attacking the jurisdiction of a court to which they submitted their cause voluntarily.35

Here, what respondent was questioning in her motion to dismiss before the trial court was that court’s jurisdiction over the person of defendant Manuel. Thus, the principle of estoppel by laches finds no application in this case. Instead, the principles relating to jurisdiction over the person of the parties are pertinent herein.

The Rules of Court provide:

RULE 9EFFECT OF FAILURE TO PLEAD

Section 1. Defenses and objections not pleaded. – Defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived. However, when it appears from the

pleadings or the evidence on record that the court has no jurisdiction over the subject matter, that there is another action pending between the same parties for the same cause, or that the action is barred by a prior judgment or by statute of limitations, the court shall dismiss the claim.

RULE 15MOTIONS

Sec. 8. Omnibus motion. – Subject to the provisions of Section 1 of Rule 9, a motion attacking a pleading, order, judgment, or proceeding shall include all objections then available, and all objections not so included shall be deemed waived.

Based on the foregoing provisions, the "objection on jurisdictional grounds which is not waived even if not alleged in a motion to dismiss or the answer is lack of jurisdiction over the subject matter. x x x Lack of jurisdiction over the subject matter can always be raised anytime, even for the first time on appeal, since jurisdictional issues cannot be waived x x x subject, however, to the principle of estoppel by laches."36

Since the defense of lack of jurisdiction over the person of a party to a case is not one of those defenses which are not deemed waived under Section 1 of Rule 9, such defense must be invoked when an answer or a motion to dismiss is filed in order to prevent a waiver of the defense.37 If the objection is not raised either in a motion to dismiss or in the answer, the objection to the jurisdiction over the person of the plaintiff or the defendant is deemed waived by virtue of the first sentence of the above-quoted Section 1 of Rule 9 of the Rules of Court.38

The Court of Appeals, therefore, erred when it made a sweeping pronouncement in its questioned decision, stating that "issue on jurisdiction may be raised at any stage of the proceeding, even for the first time on appeal" and that, therefore, respondent timely raised the issue in her motion to dismiss and is, consequently, not estopped from raising the question of jurisdiction. As the question of jurisdiction involved here is that over the person of the defendant Manuel, the same is deemed waived if not raised in the answer or a motion to dismiss. In any case, respondent cannot claim the defense since "lack of jurisdiction over the person, being subject to waiver, is a personal defense which can only be asserted by the party who can thereby waive it by silence."39

2. Jurisdiction over the person of a defendant is acquired through a valid service of summons; trial court did not acquire jurisdiction over the person of Manuel Toledo

In the first place, jurisdiction over the person of Manuel was never acquired by the trial court. A defendant is informed of a case against him when he receives summons. "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."40

In the case at bar, the trial court did not acquire jurisdiction over the person of Manuel since there was no valid service of summons upon him, precisely because he was already dead even before the complaint against him and his wife was filed in the trial court. The issues presented in this case are similar to those in the case of Sarsaba v. Vda. de Te.41

In Sarsaba, the NLRC rendered a decision declaring that Patricio Sereno was illegally dismissed from employment and ordering the payment of his monetary claims. To satisfy the claim, a truck in the possession of Sereno’s employer was levied upon by a sheriff of the NLRC, accompanied by Sereno and his lawyer, Rogelio Sarsaba, the petitioner in that case. A complaint for recovery of motor vehicle and damages, with prayer for the delivery of the truck pendente lite was eventually filed against Sarsaba, Sereno, the NLRC sheriff and the NLRC by the registered owner of the truck. After his motion to dismiss was denied by the trial court, petitioner Sarsaba filed his answer. Later on, however, he filed an omnibus motion to dismiss citing, as one of the grounds, lack of jurisdiction over one of the principal defendants, in view of the fact that Sereno was already dead when the complaint for recovery of possession was filed.

Although the factual milieu of the present case is not exactly similar to that of Sarsaba, one of the issues submitted for resolution in both cases is similar: whether or not a case, where one of the named defendants was already dead at the time of its filing, should be dismissed so that the claim may be pursued instead in the proceedings for the settlement of the estate of the deceased defendant. The petitioner in the Sarsaba Case claimed, as did respondent herein, that since one of the defendants died before summons was served on him, the trial court should have dismissed the complaint against all the defendants and the claim should be filed against the estate of the deceased defendant. The petitioner in Sarsaba, therefore, prayed that the complaint be dismissed, not only against Sereno, but as to all the defendants, considering that the RTC did not acquire jurisdiction over the person of Sereno.42 This is exactly the same prayer made by respondent herein in her motion to dismiss.

The Court, in the Sarsaba Case, resolved the issue in this wise:

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x x x We cannot countenance petitioner’s argument that the complaint against the other defendants should have been dismissed, considering that the RTC never acquired jurisdiction over the person of Sereno. The court’s failure to acquire jurisdiction over one’s person is a defense which is personal to the person claiming it. Obviously, it is now impossible for Sereno to invoke the same in view of his death. Neither can petitioner invoke such ground, on behalf of Sereno, so as to reap the benefit of having the case dismissed against all of the defendants. Failure to serve summons on Sereno’s person will not be a cause for the dismissal of the complaint against the other defendants, considering that they have been served with copies of the summons and complaints and have long submitted their respective responsive pleadings. In fact, the other defendants in the complaint were given the chance to raise all possible defenses and objections personal to them in their respective motions to dismiss and their subsequent answers.43 (Emphasis supplied.)

Hence, the Supreme Court affirmed the dismissal by the trial court of the complaint against Sereno only.

Based on the foregoing pronouncements, there is no basis for dismissing the complaint against respondent herein. Thus, as already emphasized above, the trial court correctly denied her motion to dismiss.

On whether or not the estate of Manuel

Toledo is an indispensable party

Rule 3, Section 7 of the 1997 Rules of Court states:

SEC. 7. Compulsory joinder of indispensable parties. – Parties-in-interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants.

An indispensable party is one who has such an interest in the controversy or subject matter of a case that a final adjudication cannot be made in his or her absence, without injuring or affecting that interest. He or she is a party who has not only an interest in the subject matter of the controversy, but "an interest of such nature that a final decree cannot be made without affecting that interest or leaving the controversy in such a condition that its final determination may be wholly inconsistent with equity and good conscience. It has also been considered that an indispensable party is a person in whose absence there cannot be a determination between the parties already before the court which is effective, complete or equitable." Further, an indispensable

party is one who must be included in an action before it may properly proceed.44

On the other hand, a "person is not an indispensable party if his interest in the controversy or subject matter is separable from the interest of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which does complete justice between them. Also, a person is not an indispensable party if his presence would merely permit complete relief between him or her and those already parties to the action, or if he or she has no interest in the subject matter of the action." It is not a sufficient reason to declare a person to be an indispensable party simply because his or her presence will avoid multiple litigations.45

Applying the foregoing pronouncements to the case at bar, it is clear that the estate of Manuel is not an indispensable party to the collection case, for the simple reason that the obligation of Manuel and his wife, respondent herein, is solidary.

The contract between petitioner, on the one hand and respondent and respondent’s husband, on the other, states:

FOR VALUE RECEIVED, I/We jointly and severally46 (in solemn) promise to pay BOSTON EQUITY RESOURCES, INC. x x x the sum of PESOS: [ONE MILLION FOUR HUNDRED (P1,400,000.00)] x x x.47

The provisions and stipulations of the contract were then followed by the respective signatures of respondent as "MAKER" and her husband as "CO-MAKER."48 Thus, pursuant to Article 1216 of the Civil Code, petitioner may collect the entire amount of the obligation from respondent only. The aforementioned provision states: "The creditor may proceed against any one of the solidary debtors or some or all of them simultaneously. The demand made against 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 other words, the collection case can proceed and the demands of petitioner can be satisfied by respondent only, even without impleading the estate of Manuel. Consequently, the estate of Manuel is not an indispensable party to petitioner’s complaint for sum of money.

However, the Court of Appeals, agreeing with the contention of respondent, held that the claim of petitioner should have been filed against the estate of Manuel in accordance with Sections 5 and 6 of Rule 86 of the Rules of Court. The aforementioned provisions provide:

SEC. 5. Claims which must be filed under the notice. If not filed, barred; exceptions. All claims for money against the decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims for funeral expenses and judgment for money against the decedent, must be filed within the time limited in the notice; otherwise, they are barred forever, except that they may be set forth as counterclaims in any action that the executor or administrator may bring against the claimants. x x x.

SEC. 6. Solidary obligation of decedent. Where the obligation of the decedent is solidary with another debtor, the claim shall be filed against the decedent as if he were the only debtor, without prejudice to the right of the estate to recover contribution from the other debtor. x x x.

The Court of Appeals erred in its interpretation of the above-quoted provisions.

In construing Section 6, Rule 87 of the old Rules of Court, the precursor of Section 6, Rule 86 of the Revised Rules of Court, which latter provision has been retained in the present Rules of Court without any revisions, the Supreme Court, in the case of Manila Surety & Fidelity Co., Inc. v. Villarama, et. al.,49 held:50

Construing Section 698 of the Code of Civil Procedure from whence [Section 6, Rule 87] was taken, this Court held that where two persons are bound in solidum for the same debt and one of them dies, the whole indebtedness can be proved against the estate of the latter, the decedent’s liability being absolute and primary; x x x. It is evident from the foregoing that Section 6 of Rule 87 provides the procedure should the creditor desire to go against the deceased debtor, but there is certainly nothing in the said provision making compliance with such procedure a condition precedent before an ordinary action against the surviving solidary debtors, should the creditor choose to demand payment from the latter, could be entertained to the extent that failure to observe the same would deprive the court jurisdiction to take cognizance of the action against the surviving debtors. Upon the other hand, the Civil Code expressly allows the creditor to proceed against any one of the solidary debtors or some or all of them simultaneously. There is, therefore, nothing improper in the creditor’s filing of an action against the surviving solidary debtors alone, instead of instituting a proceeding for the settlement of the estate of the deceased debtor wherein his claim could be filed.

The foregoing ruling was reiterated and expounded in the later case of Philippine National Bank v. Asuncion51where the Supreme Court pronounced:

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A cursory perusal of Section 6, Rule 86 of the Revised Rules of Court reveals that nothing therein prevents a creditor from proceeding against the surviving solidary debtors. Said provision merely sets up the procedure in enforcing collection in case a creditor chooses to pursue his claim against the estate of the deceased solidary debtor. The rule has been set forth that a creditor (in a solidary obligation) has the option whether to file or not to file a claim against the estate of the solidary debtor. x x x

x x x x

It is crystal clear that Article 1216 of the New Civil Code is the applicable provision in this matter. Said provision gives the creditor the right to "proceed against anyone of the solidary debtors or some or all of them simultaneously." The choice is undoubtedly left to the solidary creditor to determine against whom he will enforce collection. In case of the death of one of the solidary debtors, he (the creditor) may, if he so chooses, proceed against the surviving solidary debtors without necessity of filing a claim in the estate of the deceased debtors. It is not mandatory for him to have the case dismissed as against the surviving debtors and file its claim against the estate of the deceased solidary debtor, x x x. For to require the creditor to proceed against the estate, making it a condition precedent for any collection action against the surviving debtors to prosper, would deprive him of his substantive rightsprovided by Article 1216 of the New Civil Code. (Emphasis supplied.)

As correctly argued by petitioner, if Section 6, Rule 86 of the Revised Rules of Court were applied literally, Article 1216 of the New Civil Code would, in effect, be repealed since under the Rules of Court, petitioner has no choice but to proceed against the estate of [the deceased debtor] only. Obviously, this provision diminishes the [creditor’s] right under the New Civil Code to proceed against any one, some or all of the solidary debtors. Such a construction is not sanctioned by principle, which is too well settled to require citation, that a substantive law cannot be amended by a procedural rule. Otherwise stated, Section 6, Rule 86 of the Revised Rules of Court cannot be made to prevail over Article 1216 of the New Civil Code, the former being merely procedural, while the latter, substantive.

Based on the foregoing, the estate of Manuel is not an indispensable party and the case can proceed as against respondent only. That petitioner opted to collect from respondent and not from the estate of Manuel is evidenced by its opposition to respondent’s motion to dismiss asserting that the case, as against her, should be dismissed so that petitioner can proceed against the estate of Manuel.

On whether or not the inclusion of Manuel asparty defendant is a misjoinder of party

Section 11 of Rule 3 of the Rules of Court states that "neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately."

Based on the last sentence of the afore-quoted provision of law, a misjoined party must have the capacity to sue or be sued in the event that the claim by or against the misjoined party is pursued in a separate case. In this case, therefore, the inclusion of Manuel in the complaint cannot be considered a misjoinder, as in fact, the action would have proceeded against him had he been alive at the time the collection case was filed by petitioner. This being the case, the remedy provided by Section 11 of Rule 3 does not obtain here. The name of Manuel as party-defendant cannot simply be dropped from the case. Instead, the procedure taken by the Court in Sarsaba v. Vda. de Te,52 whose facts, as mentioned earlier, resemble those of this case, should be followed herein. There, the Supreme Court agreed with the trial court when it resolved the issue of jurisdiction over the person of the deceased Sereno in this wise:

As correctly pointed by defendants, the Honorable Court has not acquired jurisdiction over the person of Patricio Sereno since there was indeed no valid service of summons insofar as Patricio Sereno is concerned. Patricio Sereno died before the summons, together with a copy of the complaint and its annexes, could be served upon him.

However, the failure to effect service of summons unto Patricio Sereno, one of the defendants herein, does not render the action DISMISSIBLE, considering that the three (3) other defendants, x x x, were validly served with summons and the case with respect to the answering defendants may still proceed independently. Be it recalled that the three (3) answering defendants have previously filed a Motion to Dismiss the Complaint which was denied by the Court.

Hence, only the case against Patricio Sereno will be DISMISSED and the same may be filed as a claim against the estate of Patricio Sereno, but the case with respect to the three (3) other accused [sic] will proceed. (Emphasis supplied.)53

As a result, the case, as against Manuel, must be dismissed.

In addition, the dismissal of the case against Manuel is further warranted by Section 1 of Rule 3 of the Rules of Court, which states that: only natural or juridical persons, or entities authorized by law may be parties in a civil action." Applying this provision of law, the Court, in the case of Ventura v. Militante,54 held:

Parties may be either plaintiffs or defendants. x x x. In order to maintain an action in a court of justice, the plaintiff must have an actual legal existence, that is, he, she or it must be a person in law and possessed of a legal entity as either a natural or an artificial person, and no suit can be lawfully prosecuted save in the name of such a person.

The rule is no different as regards party defendants. It is incumbent upon a plaintiff, when he institutes a judicial proceeding, to name the proper party defendant to his cause of action. In a suit or proceeding in personam of an adversary character, the court can acquire no jurisdiction for the purpose of trial or judgment until a party defendant who actually or legally exists and is legally capable of being sued, is brought before it. It has even been held that the question of the legal personality of a party defendant is a question of substance going to the jurisdiction of the court and not one of procedure.

The original complaint of petitioner named the "estate of Carlos Ngo as represented by surviving spouse Ms. Sulpicia Ventura" as the defendant.1âwphi1 Petitioner moved to dismiss the same on the ground that the defendant as named in the complaint had no legal personality. We agree.

x x x. Considering that capacity to be sued is a correlative of the capacity to sue, to the same extent, a decedent does not have the capacity to be sued and may not be named a party defendant in a court action. (Emphases supplied.)

Indeed, where the defendant is neither a natural nor a juridical person or an entity authorized by law, the complaint may be dismissed on the ground that the pleading asserting the claim states no cause of action or for failure to state a cause of action pursuant to Section 1(g) of Rule 16 of the Rules of Court, because a complaint cannot possibly state a cause of action against one who cannot be a party to a civil action.55

Since the proper course of action against the wrongful inclusion of Manuel as party-defendant is the dismissal of the case as against him, thus did the trial court err when it ordered the substitution of Manuel by his heirs. Substitution is proper only where the party to be substituted died during the pendency of the case, as expressly provided for by Section 16, Rule 3 of the Rules of Court, which states:

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Death of party;duty of counsel. – Whenever a party to a pending action dies, and the claim is not thereby extinguished, it shall be the duty of his counsel to inform the court within thirty (30) days after such death of the fact thereof, and to give the name and address of his legal representative or representatives. x x x

The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator x x x.

The court shall forthwith order said legal representative or representatives to appear and be substituted within a period of thirty (30) days from notice. (Emphasis supplied.)

Here, since Manuel was already dead at the time of the filing of the complaint, the court never acquired jurisdiction over his person and, in effect, there was no party to be substituted.

WHEREFORE, the petition is GRANTED. The Decision dated 28 February 2006 and the Resolution dated 1 August 2006 of the Court of Appeals in CA-G.R. SP No. 88586 are REVERSED and SET ASIDE. The Orders of the Regional Trial Court dated 8 November 2004 and 22 December 2004, respectively, in Civil Case No. 97-86672, are REINSTATED. The Regional Trial Court, Branch 24, Manila is hereby DIRECTED to proceed with the trial of Civil Case No. 97-86672 against respondent Lolita G. Toledo only, in accordance with the above pronouncements of the Court, and to decide the case with dispatch.

SO ORDERED.

JOSE PORTUGAL PEREZAssociate Justice

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G.R. No. 168539               March 25, 2014PEOPLE OF THE PHILIPPINES, Petitioner, vs.HENRY T. GO, Respondent.

D E C I S I O N

PERALTA, J.:

Before the Court is a petition for review on certiorari assailing the Resolution1 of the Third Division2 of the Sandiganbayan (SB) dated June 2, 2005 which quashed the Information filed against herein respondent for alleged violation of Section 3 (g) of Republic Act No. 3019 (R.A. 3019), otherwise known as the Anti-Graft and Corrupt Practices Act.

The Information filed against respondent is an offshoot of this Court's Decision3 in Agan, Jr. v. Philippine International Air Terminals Co., Inc. which nullified the various contracts awarded by the Government, through the Department of Transportation and Communications (DOTC), to Philippine Air Terminals, Co., Inc. (PIATCO) for the construction, operation and maintenance of the Ninoy Aquino International Airport International Passenger Terminal III (NAIA IPT III). Subsequent to the above Decision, a certain Ma. Cecilia L. Pesayco filed a complaint with the Office of the Ombudsman against several individuals for alleged violation of R.A. 3019. Among those charged was herein respondent, who was then the Chairman and President of PIATCO, for having supposedly conspired with then DOTC Secretary Arturo Enrile (Secretary Enrile) in entering into a contract which is grossly and manifestly disadvantageous to the government.

On September 16, 2004, the Office of the Deputy Ombudsman for Luzon found probable cause to indict, among others, herein respondent for violation of Section 3(g) of R.A. 3019. While there was likewise a finding of probable cause against Secretary Enrile, he was no longer indicted because he died prior to the issuance of the resolution finding probable cause.

Thus, in an Information dated January 13, 2005, respondent was charged before the SB as follows:

On or about July 12, 1997, or sometime prior or subsequent thereto, in Pasay City, Metro Manila, Philippines and within the jurisdiction of this Honorable Court, the late ARTURO ENRILE, then Secretary of the Department of Transportation and Communications (DOTC), committing the offense in relation to his office and taking advantage of the same, in conspiracy with accused, HENRY T. GO, Chairman and President of the Philippine International Air Terminals, Co., Inc. (PIATCO), did then and there, willfully, unlawfully and criminally enter into a

Concession Agreement, after the project for the construction of the Ninoy Aquino International Airport International Passenger Terminal III (NAIA IPT III) was awarded to Paircargo Consortium/PIATCO, which Concession Agreement substantially amended the draft Concession Agreement covering the construction of the NAIA IPT III under Republic Act 6957, as amended by Republic Act 7718 (BOT law), specifically the provision on Public Utility Revenues, as well as the assumption by the government of the liabilities of PIATCO in the event of the latter's default under Article IV, Section 4.04 (b) and (c) in relation to Article 1.06 of the Concession Agreement, which terms are more beneficial to PIATCO while manifestly and grossly disadvantageous to the government of the Republic of the Philippines.4

The case was docketed as Criminal Case No. 28090.

On March 10, 2005, the SB issued an Order, to wit:

The prosecution is given a period of ten (10) days from today within which to show cause why this case should not be dismissed for lack of jurisdiction over the person of the accused considering that the accused is a private person and the public official Arturo Enrile, his alleged co-conspirator, is already deceased, and not an accused in this case.5

The prosecution complied with the above Order contending that the SB has already acquired jurisdiction over the person of respondent by reason of his voluntary appearance, when he filed a motion for consolidation and when he posted bail. The prosecution also argued that the SB has exclusive jurisdiction over respondent's case, even if he is a private person, because he was alleged to have conspired with a public officer.6

On April 28, 2005, respondent filed a Motion to Quash7 the Information filed against him on the ground that the operative facts adduced therein do not constitute an offense under Section 3(g) of R.A. 3019. Respondent, citing the show cause order of the SB, also contended that, independently of the deceased Secretary Enrile, the public officer with whom he was alleged to have conspired, respondent, who is not a public officer nor was capacitated by any official authority as a government agent, may not be prosecuted for violation of Section 3(g) of R.A. 3019.

The prosecution filed its Opposition.8

On June 2, 2005, the SB issued its assailed Resolution, pertinent portions of which read thus:

Acting on the Motion to Quash filed by accused Henry T. Go dated April 22, 2005, and it appearing that Henry T. Go, the lone accused in this case is a private person and his alleged co-conspirator-public official was already deceased long before this case was filed in court, for lack of jurisdiction over the person of the accused, the Court grants the Motion to Quash and the Information filed in this case is hereby ordered quashed and dismissed.9

Hence, the instant petition raising the following issues, to wit:

IWHETHER OR NOT THE COURT A QUO GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT IN ACCORD WITH LAW OR APPLICABLE JURISPRUDENCE IN GRANTING THE DEMURRER TO EVIDENCE AND IN DISMISSING CRIMINAL CASE NO. 28090 ON THE GROUND THAT IT HAS NO JURISDICTION OVER THE PERSON OF RESPONDENT GO.

IIWHETHER OR NOT THE COURT A QUO GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT IN ACCORD WITH LAW OR APPLICABLE JURISPRUDENCE, IN RULING THAT IT HAS NO JURISDICTION OVER THE PERSON OF RESPONDENT GO DESPITE THE IRREFUTABLE FACT THAT HE HAS ALREADY POSTED BAIL FOR HIS PROVISIONAL LIBERTY

IIIWHETHER OR NOT THE COURT A QUO GRAVELY ERRED WHEN, IN COMPLETE DISREGARD OF THE EQUAL PROTECTION CLAUSE OF THE CONSTITUTION, IT QUASHED THE INFORMATION AND DISMISSED CRIMINAL CASE NO. 2809010

The Court finds the petition meritorious.

Section 3 (g) of R.A. 3019 provides:

Sec. 3. Corrupt practices of public officers. – In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful:

x x x x

(g) Entering, on behalf of the Government, into any contract or transaction manifestly and grossly disadvantageous to the same, whether or not the public officer profited or will profit thereby.

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The elements of the above provision are:

(1) that the accused is a public officer;

(2) that he entered into a contract or transaction on behalf of the government; and

(3) that such contract or transaction is grossly and manifestly disadvantageous to the government.11

At the outset, it bears to reiterate the settled rule that private persons, when acting in conspiracy with public officers, may be indicted and, if found guilty, held liable for the pertinent offenses under Section 3 of R.A. 3019, in consonance with the avowed policy of the anti-graft law to repress certain acts of public officers and private persons alike constituting graft or corrupt practices act or which may lead thereto.12 This is the controlling doctrine as enunciated by this Court in previous cases, among which is a case involving herein private respondent.13

The only question that needs to be settled in the present petition is whether herein respondent, a private person, may be indicted for conspiracy in violating Section 3(g) of R.A. 3019 even if the public officer, with whom he was alleged to have conspired, has died prior to the filing of the Information.

Respondent contends that by reason of the death of Secretary Enrile, there is no public officer who was charged in the Information and, as such, prosecution against respondent may not prosper.

The Court is not persuaded.

It is true that by reason of Secretary Enrile's death, there is no longer any public officer with whom respondent can be charged for violation of R.A. 3019. It does not mean, however, that the allegation of conspiracy between them can no longer be proved or that their alleged conspiracy is already expunged. The only thing extinguished by the death of Secretary Enrile is his criminal liability. His death did not extinguish the crime nor did it remove the basis of the charge of conspiracy between him and private respondent. Stated differently, the death of Secretary Enrile does not mean that there was no public officer who allegedly violated Section 3 (g) of R.A. 3019. In fact, the Office of the Deputy Ombudsman for Luzon found probable cause to indict Secretary Enrile for infringement of Sections 3 (e) and (g) of R.A. 3019.14 Were it not for his death, he should have been charged.

The requirement before a private person may be indicted for violation of Section 3(g) of R.A. 3019, among others, is that such private person must be alleged to have acted in conspiracy with a public officer. The law, however, does not require that such person must, in all instances, be indicted together with the public officer. If circumstances exist where the public officer may no longer be charged in court, as in the present case where the public officer has already died, the private person may be indicted alone.

Indeed, it is not necessary to join all alleged co-conspirators in an indictment for conspiracy.15 If two or more persons enter into a conspiracy, any act done by any of them pursuant to the agreement is, in contemplation of law, the act of each of them and they are jointly responsible therefor.16 This means that everything said, written or done by any of the conspirators in execution or furtherance of the common purpose is deemed to have been said, done, or written by each of them and it makes no difference whether the actual actor is alive or dead, sane or insane at the time of trial.17 The death of one of two or more conspirators does not prevent the conviction of the survivor or survivors.18 Thus, this Court held that:

x x x [a] conspiracy is in its nature a joint offense. One person cannot conspire alone. The crime depends upon the joint act or intent of two or more persons. Yet, it does not follow that one person cannot be convicted of conspiracy. So long as the acquittal or death of a co-conspirator does not remove the bases of a charge for conspiracy, one defendant may be found guilty of the offense.19

The Court agrees with petitioner's contention that, as alleged in the Information filed against respondent, which is deemed hypothetically admitted in the latter's Motion to Quash, he (respondent) conspired with Secretary Enrile in violating Section 3 (g) of R.A. 3019 and that in conspiracy, the act of one is the act of all. Hence, the criminal liability incurred by a co-conspirator is also incurred by the other co-conspirators.

Moreover, the Court agrees with petitioner that the avowed policy of the State and the legislative intent to repress "acts of public officers and private persons alike, which constitute graft or corrupt practices,"20 would be frustrated if the death of a public officer would bar the prosecution of a private person who conspired with such public officer in violating the Anti-Graft Law.

In this regard, this Court's disquisition in the early case of People v. Peralta21 as to the nature of and the principles governing conspiracy, as construed under Philippine jurisdiction, is instructive, to wit:

x x x A conspiracy exists when two or more persons come to an agreement concerning the commission of a felony and decide to commit it. Generally, conspiracy is not a crime except when the law specifically provides a penalty therefor as in treason, rebellion and sedition. The crime of conspiracy known to the common law is not an indictable offense in the Philippines. An agreement to commit a crime is a reprehensible act from the view-point of morality, but as long as the conspirators do not perform overt acts in furtherance of their malevolent design, the sovereignty of the State is not outraged and the tranquility of the public remains undisturbed.

However, when in resolute execution of a common scheme, a felony is committed by two or more malefactors, the existence of a conspiracy assumes pivotal importance in the determination of the liability of the perpetrators. In stressing the significance of conspiracy in criminal law, this Court in U.S. vs. Infante and Barreto opined that

While it is true that the penalties cannot be imposed for the mere act of conspiring to commit a crime unless the statute specifically prescribes a penalty therefor, nevertheless the existence of a conspiracy to commit a crime is in many cases a fact of vital importance, when considered together with the other evidence of record, in establishing the existence, of the consummated crime and its commission by the conspirators.

Once an express or implied conspiracy is proved, all of the conspirators are liable as co-principals regardless of the extent and character of their respective active participation in the commission of the crime or crimes perpetrated in furtherance of the conspiracy because in contemplation of law the act of one is the act of all. The foregoing rule is anchored on the sound principle that "when two or more persons unite to accomplish a criminal object, whether through the physical volition of one, or all, proceeding severally or collectively, each individual whose evil will actively contributes to the wrong-doing is in law responsible for the whole, the same as though performed by himself alone." Although it is axiomatic that no one is liable for acts other than his own, "when two or more persons agree or conspire to commit a crime, each is responsible for all the acts of the others, done in furtherance of the agreement or conspiracy." The imposition of collective liability upon the conspirators is clearly explained in one case where this Court held that x x x it is impossible to graduate the separate liability of each (conspirator) without taking into consideration the close and inseparable relation of each of them with the criminal act, for the commission of which they all acted by common agreement x x x. The crime must therefore in view of the solidarity of the act and intent which existed between the x x x accused, be regarded as the act of the band or party created by them, and they are all equally responsible x x x

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Verily, the moment it is established that the malefactors conspired and confederated in the commission of the felony proved, collective liability of the accused conspirators attaches by reason of the conspiracy, and the court shall not speculate nor even investigate as to the actual degree of participation of each of the perpetrators present at the scene of the crime. Of course, as to any conspirator who was remote from the situs of aggression, he could be drawn within the enveloping ambit of the conspiracy if it be proved that through his moral ascendancy over the rest of the conspirators the latter were moved or impelled to carry out the conspiracy.

In fine, the convergence of the wills of the conspirators in the scheming and execution of the crime amply justifies the imputation to all of them the act of any one of them. It is in this light that conspiracy is generally viewed not as a separate indictable offense, but a rule for collectivizing criminal liability.

x x x x

x x x A time-honored rule in the corpus of our jurisprudence is that once conspiracy is proved, all of the conspirators who acted in furtherance of the common design are liable as co-principals. This rule of collective criminal liability emanates from the ensnaring nature of conspiracy. The concerted action of the conspirators in consummating their common purpose is a patent display of their evil partnership, and for the consequences of such criminal enterprise they must be held solidarily liable.22

This is not to say, however, that private respondent should be found guilty of conspiring with Secretary Enrile. It is settled that the absence or presence of conspiracy is factual in nature and involves evidentiary matters.23 Hence, the allegation of conspiracy against respondent is better left ventilated before the trial court during trial, where respondent can adduce evidence to prove or disprove its presence.

Respondent claims in his Manifestation and Motion24 as well as in his Urgent Motion to Resolve25 that in a different case, he was likewise indicted before the SB for conspiracy with the late Secretary Enrile in violating the same Section 3 (g) of R.A. 3019 by allegedly entering into another agreement (Side Agreement) which is separate from the Concession Agreement subject of the present case. The case was docketed as Criminal Case No. 28091. Here, the SB, through a Resolution, granted respondent's motion to quash the Information on the ground that the SB has no jurisdiction over the person of respondent. The prosecution questioned the said SB Resolution before this Court via a petition for review on certiorari. The petition was docketed as G.R. No. 168919. In a minute resolution dated August 31, 2005, this Court

denied the petition finding no reversible error on the part of the SB. This Resolution became final and executory on January 11, 2006. Respondent now argues that this Court's resolution in G.R. No. 168919 should be applied in the instant case.

The Court does not agree. Respondent should be reminded that prior to this Court's ruling in G.R. No. 168919, he already posted bail for his provisional liberty. In fact, he even filed a Motion for Consolidation26 in Criminal Case No. 28091. The Court agrees with petitioner's contention that private respondent's act of posting bail and filing his Motion for Consolidation vests the SB with jurisdiction over his person. The rule is well settled that the act of an accused in posting bail or in filing motions seeking affirmative relief is tantamount to submission of his person to the jurisdiction of the court.27

Thus, it has been held that:

When a defendant in a criminal case is brought before a competent court by virtue of a warrant of arrest or otherwise, in order to avoid the submission of his body to the jurisdiction of the court he must raise the question of the court’s jurisdiction over his person at the very earliest opportunity. If he gives bail, demurs to the complaint or files any dilatory plea or pleads to the merits, he thereby gives the court jurisdiction over his person. (State ex rel. John Brown vs. Fitzgerald, 51 Minn., 534)

x x x x

As ruled in La Naval Drug vs. CA [236 SCRA 78, 86]:

"[L]ack of jurisdiction over the person of the defendant may be waived either expressly or impliedly. When a defendant voluntarily appears, he is deemed to have submitted himself to the jurisdiction of the court. If he so wishes not to waive this defense, he must do so seasonably by motion for the purpose of objecting to the jurisdiction of the court; otherwise, he shall be deemed to have submitted himself to that jurisdiction."

Moreover, "[w]here the appearance is by motion for the purpose of objecting to the jurisdiction of the court over the person, it must be for the sole and separate purpose of objecting to said jurisdiction. If the appearance is for any other purpose, the defendant is deemed to have submitted himself to the jurisdiction of the court. Such an appearance gives the court jurisdiction over the person."

Verily, petitioner’s participation in the proceedings before the Sandiganbayan was not confined to his opposition to the issuance

of a warrant of arrest but also covered other matters which called for respondent court’s exercise of its jurisdiction. Petitioner may not be heard now to deny said court’s jurisdiction over him. x x x.28

In the instant case, respondent did not make any special appearance to question the jurisdiction of the SB over his person prior to his posting of bail and filing his Motion for Consolidation. In fact, his Motion to Quash the Information in Criminal Case No. 28090 only came after the SB issued an Order requiring the prosecution to show cause why the case should not be dismissed for lack of jurisdiction over his person.

As a recapitulation, it would not be amiss to point out that the instant case involves a contract entered into by public officers representing the government. More importantly, the SB is a special criminal court which has exclusive original jurisdiction in all cases involving violations of R.A. 3019 committed by certain public officers, as enumerated in P.D. 1606 as amended by R.A. 8249. This includes private individuals who are charged as co-principals, accomplices or accessories with the said public officers. In the instant case, respondent is being charged for violation of Section 3(g) of R.A. 3019, in conspiracy with then Secretary Enrile. Ideally, under the law, both respondent and Secretary Enrile should have been charged before and tried jointly by the Sandiganbayan. However, by reason of the death of the latter, this can no longer be done. Nonetheless, for reasons already discussed, it does not follow that the SB is already divested of its jurisdiction over the person of and the case involving herein respondent. To rule otherwise would mean that the power of a court to decide a case would no longer be based on the law defining its jurisdiction but on other factors, such as the death of one of the alleged offenders.

Lastly, the issues raised in the present petition involve matters which are mere incidents in the main case and the main case has already been pending for over nine (9) years. Thus, a referral of the case to the Regional Trial Court would further delay the resolution of the main case and it would, by no means, promote respondent's right to a speedy trial and a speedy disposition of his case.

WHEREFORE, the petition is GRANTED. The Resolution of the Sandiganbayan dated June 2, 2005, granting respondent's Motion to Quash, is hereby REVERSED and SET ASIDE. The Sandiganbayan is forthwith DIRECTED to proceed with deliberate dispatch in the disposition of Criminal Case No. 28090.

SO ORDERED.DIOSDADO M. PERALTAAssociate Justice

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G.R. No. 175723               February 4, 2014

THE CITY OF MANILA, represented by MAYOR JOSE L. ATIENZA, JR., and MS. LIBERTY M. TOLEDO, in her capacity as the City Treasurer of Manila, Petitioners, vs.HON. CARIDAD H. GRECIA-CUERDO, in her capacity as Presiding Judge of the Regional Trial Court, Branch 112, Pasay City; SM MART, INC.; SM PRIME HOLDINGS, INC.; STAR APPLIANCES CENTER; SUPERVALUE, INC.; ACE HARDWARE PHILIPPINES, INC.; WATSON PERSONAL CARE STORES, PHILS., INC.; JOLLIMART PHILS., CORP.; SURPLUS MARKETING CORPORATION and SIGNATURE LINES,Respondents.

D E C I S I O N

PERALTA, J.:

Before the Court is a special civil action for certiorari under Rule 65 of the Rules of Court seeking to reverse and set aside the Resolutions1 dated April 6, 2006 and November 29, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 87948.

The antecedents of the case, as summarized by the CA, are as follows:

The record shows that petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the taxable period from January to December 2002 against private respondents SM Mart, Inc., SM Prime Holdings, Inc., Star Appliances Center, Supervalue, Inc., Ace Hardware Philippines, Inc., Watsons Personal Care Stores Phils., Inc., Jollimart Philippines Corp., Surplus Marketing Corp. and Signature Lines. In addition to the taxes purportedly due from private respondents pursuant to Section 14, 15, 16, 17 of the Revised Revenue Code of Manila (RRCM), said assessment covered the local business taxes petitioners were authorized to collect under Section 21 of the same Code. Because payment of the taxes assessed was a precondition for the issuance of their business permits, private respondents were constrained to pay the P19,316,458.77 assessment under protest.

On January 24, 2004, private respondents filed [with the Regional Trial Court of Pasay City] the complaint denominated as one for "Refund or Recovery of Illegally and/or Erroneously-Collected Local Business Tax, Prohibition with Prayer to Issue TRO and Writ of Preliminary Injunction"

which was docketed as Civil Case No. 04-0019-CFM before public respondent's sala [at Branch 112]. In the amended complaint they filed on February 16, 2004, private respondents alleged that, in relation to Section 21 thereof, Sections 14, 15, 16, 17, 18, 19 and 20 of the RRCM were violative of the limitations and guidelines under Section 143 (h) of Republic Act. No. 7160 [Local Government Code] on double taxation. They further averred that petitioner city's Ordinance No. 8011 which amended pertinent portions of the RRCM had already been declared to be illegal and unconstitutional by the Department of Justice.2

In its Order3 dated July 9, 2004, the RTC granted private respondents' application for a writ of preliminary injunction.

Petitioners filed a Motion for Reconsideration4 but the RTC denied it in its Order5 dated October 15, 2004.

Petitioners then filed a special civil action for certiorari with the CA assailing the July 9, 2004 and October 15, 2004 Orders of the RTC.6

In its Resolution promulgated on April 6, 2006, the CA dismissed petitioners' petition for certiorari holding that it has no jurisdiction over the said petition. The CA ruled that since appellate jurisdiction over private respondents' complaint for tax refund, which was filed with the RTC, is vested in the Court of Tax Appeals (CTA), pursuant to its expanded jurisdiction under Republic Act No. 9282 (RA 9282), it follows that a petition for certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be filed with the CTA.

Petitioners filed a Motion for Reconsideration,7 but the CA denied it in its Resolution dated November 29, 2006.

Hence, the present petition raising the following issues:

I- Whether or not the Honorable Court of Appeals gravely erred in dismissing the case for lack of jurisdiction.

II- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction in enjoining by issuing a Writ of Injunction the petitioners, their agents and/or authorized representatives from implementing Section 21 of the Revised Revenue Code of Manila, as amended, against private respondents.

III- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction in issuing the Writ of Injunction despite failure of private respondents to make a written claim for tax credit or refund with the City Treasurer of Manila.

IV- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction considering that under Section 21 of the Manila Revenue Code, as amended, they are mere collecting agents of the City Government.

V- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction in issuing the Writ of Injunction because petitioner City of Manila and its constituents would result to greater damage and prejudice thereof. (sic)8

Without first resolving the above issues, this Court finds that the instant petition should be denied for being moot and academic.

Upon perusal of the original records of the instant case, this Court discovered that a Decision9 in the main case had already been rendered by the RTC on August 13, 2007, the dispositive portion of which reads as follows:

WHEREFORE, in view of the foregoing, this Court hereby renders JUDGMENT in favor of the plaintiff and against the defendant to grant a tax refund or credit for taxes paid pursuant to Section 21 of the Revenue Code of the City of Manila as amended for the year 2002 in the following amounts:

To plaintiff SM Mart, Inc. - P 11,462,525.02To plaintiff SM Prime Holdings, Inc. - 3,118,104.63To plaintiff Star Appliances Center - 2,152,316.54To plaintiff Supervalue, Inc. - 1,362,750.34To plaintiff Ace Hardware Phils., Inc. - 419,689.04To plaintiff Watsons Personal Care Health

- 231,453.62

Stores Phils., Inc.To plaintiff Jollimart Phils., Corp. - 140,908.54To plaintiff Surplus Marketing Corp. - 220,204.70To plaintiff Signature Mktg. Corp. - 94,906.34

TOTAL: - P 19,316,458.77

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Defendants are further enjoined from collecting taxes under Section 21, Revenue Code of Manila from herein plaintiff.

SO ORDERED.10

The parties did not inform the Court but based on the records, the above Decision had already become final and executory per the Certificate of Finality11 issued by the same trial court on October 20, 2008. In fact, a Writ of Execution12 was issued by the RTC on November 25, 2009. In view of the foregoing, it clearly appears that the issues raised in the present petition, which merely involve the incident on the preliminary injunction issued by the RTC, have already become moot and academic considering that the trial court, in its decision on the merits in the main case, has already ruled in favor of respondents and that the same decision is now final and executory. Well entrenched is the rule that where the issues have become moot and academic, there is no justiciable controversy, thereby rendering the resolution of the same of no practical use or value.13

In any case, the Court finds it necessary to resolve the issue on jurisdiction raised by petitioners owing to its significance and for future guidance of both bench and bar. It is a settled principle that courts will decide a question otherwise moot and academic if it is capable of repetition, yet evading review.14

However, before proceeding, to resolve the question on jurisdiction, the Court deems it proper to likewise address a procedural error which petitioners committed.

Petitioners availed of the wrong remedy when they filed the instant special civil action for certiorari under Rule 65 of the Rules of Court in assailing the Resolutions of the CA which dismissed their petition filed with the said court and their motion for reconsideration of such dismissal. There is no dispute that the assailed Resolutions of the CA are in the nature of a final order as they disposed of the petition completely. It is settled that in cases where an assailed judgment or order is considered final, the remedy of the aggrieved party is appeal. Hence, in the instant case, petitioner should have filed a petition for review on certiorari under Rule 45, which is a continuation of the appellate process over the original case.15

Petitioners should be reminded of the equally-settled rule that a special civil action for certiorari under Rule 65 is an original or independent action based on grave abuse of discretion amounting to lack or excess of jurisdiction and it will lie only if there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.16 As such, it cannot be a substitute for a lost appeal.17

Nonetheless, in accordance with the liberal spirit pervading the Rules of Court and in the interest of substantial justice, this Court has, before, treated a petition for certiorari as a petition for review on certiorari, particularly (1) if the petition for certiorari was filed within the reglementary period within which to file a petition for review on certiorari; (2) when errors of judgment are averred; and (3) when there is sufficient reason to justify the relaxation of the rules.18 Considering that the present petition was filed within the 15-day reglementary period for filing a petition for review on certiorari under Rule 45, that an error of judgment is averred, and because of the significance of the issue on jurisdiction, the Court deems it proper and justified to relax the rules and, thus, treat the instant petition for certiorari as a petition for review on certiorari.

Having disposed of the procedural aspect, we now turn to the central issue in this case. The basic question posed before this Court is whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the RTC in a local tax case.

This Court rules in the affirmative.

On June 16, 1954, Congress enacted Republic Act No. 1125 (RA 1125) creating the CTA and giving to the said court jurisdiction over the following:

(1) Decisions of the Collector of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the National Internal Revenue Code or other law or part of law administered by the Bureau of Internal Revenue;

(2) Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges; seizure, detention or release of property affected fines, forfeitures or other penalties imposed in relation thereto; or other matters arising under the Customs Law or other law or part of law administered by the Bureau of Customs; and

(3) Decisions of provincial or City Boards of Assessment Appeals in cases involving the assessment and taxation of real property or other matters arising under the Assessment Law, including rules and regulations relative thereto.

On March 30, 2004, the Legislature passed into law Republic Act No. 9282 (RA 9282) amending RA 1125 by expanding the jurisdiction of the CTA, enlarging its membership and elevating its rank to the level of a collegiate court with special jurisdiction. Pertinent portions of the amendatory act provides thus:

Sec. 7. Jurisdiction. - The CTA shall exercise:

a. Exclusive appellate jurisdiction to review by appeal, as herein provided:

1. Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue or other laws administered by the Bureau of Internal Revenue;

2. Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue, where the National Internal Revenue Code provides a specific period of action, in which case the inaction shall be deemed a denial;

3. Decisions, orders or resolutions of the Regional Trial Courts in local tax cases originally decided or resolved by them in the exercise of their original or appellate jurisdiction;

4. Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges, seizure, detention or release of property affected, fines, forfeitures or other penalties in relation thereto, or other matters arising under the Customs Law or other laws administered by the Bureau of Customs;

5. Decisions of the Central Board of Assessment Appeals in the exercise of its appellate jurisdiction over cases involving the assessment and taxation of real property originally decided by the provincial or city board of assessment appeals;

6. Decisions of the Secretary of Finance on customs cases elevated to him automatically for review from decisions of the Commissioner of Customs which are

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adverse to the Government under Section 2315 of the Tariff and Customs Code;

7. Decisions of the Secretary of Trade and Industry, in the case of nonagricultural product, commodity or article, and the Secretary of Agriculture in the case of agricultural product, commodity or article, involving dumping and countervailing duties under Section 301 and 302, respectively, of the Tariff and Customs Code, and safeguard measures under Republic Act No. 8800, where either party may appeal the decision to impose or not to impose said duties.

b. Jurisdiction over cases involving criminal offenses as herein provided:

1. Exclusive original jurisdiction over all criminal offenses arising from violations of the National Internal Revenue Code or Tariff and Customs Code and other laws administered by the Bureau of Internal Revenue or the Bureau of Customs: Provided, however, That offenses or felonies mentioned in this paragraph where the principal amount of taxes and fees, exclusive of charges and penalties, claimed is less than One million pesos (P1,000,000.00) or where there is no specified amount claimed shall be tried by the regular Courts and the jurisdiction of the CTA shall be appellate. Any provision of law or the Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liability for taxes and penalties shall at all times be simultaneously instituted with, and jointly determined in the same proceeding by the CTA, the filing of the criminal action being deemed to necessarily carry with it the filing of the civil action, and no right to reserve the filing of such civil action separately from the criminal action will be recognized.

2. Exclusive appellate jurisdiction in criminal offenses:

a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax cases originally decided by them, in their respected territorial jurisdiction.

b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the exercise of their appellate jurisdiction over tax cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts in their respective jurisdiction.

c. Jurisdiction over tax collection cases as herein provided:

1. Exclusive original jurisdiction in tax collection cases involving final and executory assessments for taxes, fees, charges and penalties: Provides, however, that collection cases where the principal amount of taxes and fees, exclusive of charges and penalties, claimed is less than One million pesos (P1,000,000.00) shall be tried by the proper Municipal Trial Court, Metropolitan Trial Court and Regional Trial Court.

2. Exclusive appellate jurisdiction in tax collection cases:

a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax collection cases originally decided by them, in their respective territorial jurisdiction.

b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the Exercise of their appellate jurisdiction over tax collection cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts, in their respective jurisdiction.19

A perusal of the above provisions would show that, while it is clearly stated that the CTA has exclusive appellate jurisdiction over decisions, orders or resolutions of the RTCs in local tax cases originally decided or resolved by them in the exercise of their original or appellate jurisdiction, there is no categorical statement under RA 1125 as well as the amendatory RA 9282, which provides that th e CTA has jurisdiction over petitions for certiorari assailing interlocutory orders issued by the RTC in local tax cases filed before it.

The prevailing doctrine is that the authority to issue writs of certiorari involves the exercise of original jurisdiction which must be expressly conferred by the Constitution or by law and cannot be implied from the mere existence of appellate jurisdiction.20 Thus, in the cases of Pimentel v. COMELEC,21 Garcia v. De Jesus,22 Veloria v. COMELEC,23 Department of Agrarian Reform Adjudication Board v. Lubrica,24 and Garcia v. Sandiganbayan,25this Court has ruled against the jurisdiction of courts or tribunals over petitions for certiorari on the ground that there is no law which expressly gives these tribunals such power.26 It must be observed, however, that with the exception of Garcia v. Sandiganbayan,27 these rulings pertain not to regular courts but to tribunals exercising quasi-judicial powers. With respect to the Sandiganbayan, Republic Act No. 824928 now provides that the special criminal court 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.

In the same manner, Section 5 (1), Article VIII of the 1987 Constitution grants power to the Supreme Court, in the exercise of its original jurisdiction, to issue writs of certiorari, prohibition and mandamus. With respect to the Court of Appeals, Section 9 (1) of Batas Pambansa Blg. 129 (BP 129) gives the appellate court, also in the exercise of its original jurisdiction, the power to issue, among others, a writ of certiorari,whether or not in aid of its appellate jurisdiction. As to Regional Trial Courts, the power to issue a writ of certiorari, in the exercise of their original jurisdiction, is provided under Section 21 of BP 129.

The foregoing notwithstanding, while there is no express grant of such power, with respect to the CTA, Section 1, Article VIII of the 1987 Constitution provides, nonetheless, that judicial power shall be vested in one Supreme Court and in such lower courts as may be established by law and that judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.

On the strength of the above constitutional provisions, it can be fairly interpreted that the power of the CTA includes that of determining whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the RTC in issuing an interlocutory order in cases falling within the exclusive appellate jurisdiction of the tax court. It, thus, follows that the CTA, by constitutional mandate, is vested with jurisdiction to issue writs of certiorari in these cases.

Indeed, in order for any appellate court to effectively exercise its appellate jurisdiction, it must have the authority to issue, among others, a writ of certiorari. In transferring exclusive jurisdiction over appealed tax cases to the CTA, it can reasonably be assumed that the law intended to transfer also such power as is deemed necessary, if not indispensable, in aid of such appellate jurisdiction. There is no perceivable reason why the transfer should only be considered as partial, not total.

Consistent with the above pronouncement, this Court has held as early as the case of J.M. Tuason & Co., Inc. v. Jaramillo, et al.29 that "if a case may be appealed to a particular court or judicial tribunal or body, then said court or judicial tribunal or body has jurisdiction to issue the extraordinary writ of certiorari, in aid of its appellate jurisdiction."30 This principle was affirmed in De Jesus v. Court of Appeals,31 where the Court stated that "a court may issue

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a writ of certiorari in aid of its appellate jurisdiction if said court has jurisdiction to review, by appeal or writ of error, the final orders or decisions of the lower court."32 The rulings in J.M. Tuason and De Jesus were reiterated in the more recent cases of Galang, Jr. v. Geronimo33 and Bulilis v. Nuez.34

Furthermore, Section 6, Rule 135 of the present Rules of Court provides that when by law, jurisdiction is conferred on a court or judicial officer, all auxiliary writs, processes and other means necessary to carry it into effect may be employed by such court or officer.

If this Court were to sustain petitioners' contention that jurisdiction over their certiorari petition lies with the CA, this Court would be confirming the exercise by two judicial bodies, the CA and the CTA, of jurisdiction over basically the same subject matter – precisely the split-jurisdiction situation which is anathema to the orderly administration of justice.35 The Court cannot accept that such was the legislative motive, especially considering that the law expressly confers on the CTA, the tribunal with the specialized competence over tax and tariff matters, the role of judicial review over local tax cases without mention of any other court that may exercise such power. Thus, the Court agrees with the ruling of the CA that since appellate jurisdiction over private respondents' complaint for tax refund is vested in the CTA, it follows that a petition for certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be filed with the same court. To rule otherwise would lead to an absurd situation where one court decides an appeal in the main case while another court rules on an incident in the very same case.

Stated differently, it would be somewhat incongruent with the pronounced judicial abhorrence to split jurisdiction to conclude that the intention of the law is to divide the authority over a local tax case filed with the RTC by giving to the CA or this Court jurisdiction to issue a writ of certiorari against interlocutory orders of the RTC but giving to the CTA the jurisdiction over the appeal from the decision of the trial court in the same case. It is more in consonance with logic and legal soundness to conclude that the grant of appellate jurisdiction to the CTA over tax cases filed in and decided by the RTC carries with it the power to issue a writ of certiorari when necessary in aid of such appellate jurisdiction. The supervisory power or jurisdiction of the CTA to issue a writ of certiorari in aid of its appellate jurisdiction should co-exist with, and be a complement to, its appellate jurisdiction to review, by appeal, the final orders and decisions of the RTC, in order to have complete supervision over the acts of the latter.36

A grant of appellate jurisdiction implies that there is included in it the power necessary to exercise it effectively, to make all orders

that will preserve the subject of the action, and to give effect to the final determination of the appeal. It carries with it the power to protect that jurisdiction and to make the decisions of the court thereunder effective. The court, in aid of its appellate jurisdiction, has authority to control all auxiliary and incidental matters necessary to the efficient and proper exercise of that jurisdiction.1âwphi1 For this purpose, it may, when necessary, prohibit or restrain the performance of any act which might interfere with the proper exercise of its rightful jurisdiction in cases pending before it.37

Lastly, it would not be amiss to point out that a court which is endowed with a particular jurisdiction should have powers which are necessary to enable it to act effectively within such jurisdiction. These should be regarded as powers which are inherent in its jurisdiction and the court must possess them in order to enforce its rules of practice and to suppress any abuses of its process and to defeat any attempted thwarting of such process.

In this regard, Section 1 of RA 9282 states that the CTA shall be of the same level as the CA and shall possess all the inherent powers of a court of justice.

Indeed, courts possess certain inherent powers which may be said to be implied from a general grant of jurisdiction, in addition to those expressly conferred on them. These inherent powers are such powers as are necessary for the ordinary and efficient exercise of jurisdiction; or are essential to the existence, dignity and functions of the courts, as well as to the due administration of justice; or are directly appropriate, convenient and suitable to the execution of their granted powers; and include the power to maintain the court's jurisdiction and render it effective in behalf of the litigants.38

Thus, this Court has held that "while a court may be expressly granted the incidental powers necessary to effectuate its jurisdiction, a grant of jurisdiction, in the absence of prohibitive legislation, implies the necessary and usual incidental powers essential to effectuate it, and, subject to existing laws and constitutional provisions, every regularly constituted court has power to do all things that are reasonably necessary for the administration of justice within the scope of its jurisdiction and for the enforcement of its judgments and mandates."39 Hence, demands, matters or questions ancillary or incidental to, or growing out of, the main action, and coming within the above principles, may be taken cognizance of by the court and determined, since such jurisdiction is in aid of its authority over the principal matter, even though the court may thus be called on to

consider and decide matters which, as original causes of action, would not be within its cognizance.40

Based on the foregoing disquisitions, it can be reasonably concluded that the authority of the CTA to take cognizance of petitions for certiorari questioning interlocutory orders issued by the RTC in a local tax case is included in the powers granted by the Constitution as well as inherent in the exercise of its appellate jurisdiction.

Finally, it would bear to point out that this Court is not abandoning the rule that, insofar as quasi-judicial tribunals are concerned, the authority to issue writs of certiorari must still be expressly conferred by the Constitution or by law and cannot be implied from the mere existence of their appellate jurisdiction. This doctrine remains as it applies only to quasi-judicial bodies.

WHEREFORE, the petition is DENIED.

SO ORDERED.

DIOSDADO M. PERALTAAssociate Justice