THIRD DIVISION

 SOLIDBANK CORPORATION, NOW KNOWN AS METROPOLITAN BANK AND TRUST COMPANY,

Petitioner,   

                    - versus -   GATEWAY ELECTRONICS CORPORATION, JAIME M. HIDALGO AND ISRAEL MADUCDOC,

Respondents. 

G.R. No. 164805 Present: YNARES-SANTIAGO, J.,           Chairperson,AUSTRIA-MARTINEZ,CHICO-NAZARIO,NACHURA, andREYES, JJ. Promulgated:     April 30, 2008 

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

DECISION 

NACHURA, J.:                            

 

 

  

Before the Court is a petition for review on certiorari[1] assailing the Decision dated June 2, 2004 and the

Resolution datedJuly 29, 2004 of the Court of Appeals in CA-G.R. SP No. 73684.

 

The Facts

 

          In May and June 1997, Gateway Electronics Corporation (Gateway) obtained from Solidbank Corporation

(Solidbank) four (4) foreign currency denominated loans to be used as working capital for its manufacturing

operations.[2] The loans were covered by promissory notes[3] (PNs) which provided an interest of eight and 75/100

percent (8.75%), but was allegedly increased to ten percent (10%) per annum, and a penalty of  two percent (2%) per

month based on the total amount due computed from the date of default until full payment of the total amount due.[4] The particulars of the loans are: 

 PromissoryNote No.

   Date of Loan

   Amount of Loan

   Date Due

             a) PN 97-375   20 May 1997   US$ 190,000.00   11 Nov. 1998             b) PN 97-408   29 May 1997   US$ 570,000.00   11 Nov. 1998

             c) PN 97-435   09 June 1997   US$1,150,000.00   04 June 1998             d) PN 97-458   15 June 1997   US$ 130,000.00   15 June 1998

 

          To secure the loans covered by PN 97-375[5] and PN 97-408,[6]  Gateway assigned to Solidbank the proceeds

of its Back-end Services Agreement[7] dated June 25, 2000 with Alliance Semiconductor Corporation (Alliance). The

following stipulations are common in both PNs: 

             3.         This Note or Loan shall be paid from the foreign exchange proceeds of Our/My Letter(s) of Credit, Purchase Order or Sales Contract described as follows: *** Back-end Services Agreement dated 06-25-96 by and between Gateway Electronics Corporation and Alliance Semiconductor Corporation.             4.         We/I assign, transfer and convey to Solidbank all title and interest to the proceeds of the foregoing Letter(s) of Credit to the extent necessary to satisfy all amounts and obligations due or which may arise under this Note or Loan, and to any extension, renewal, or amendments of this Note or Loan.  We/I agree that in case the proceeds of the foregoing Letter(s) of Credit prove insufficient to pay Our/My outstanding liabilities under this Note or Loan, We/I shall continue to be liable for the deficiency.             5.         We/I irrevocably undertake to course the foreign exchange proceeds of the Letter(s) of Credit directly with Solidbank.  Our/My failure to comply with the above would render Us or Me in default of the loan or credit facility without need of demand.[8]

  

          Gateway failed to comply with its loan obligations. By January 31, 2000, Gateway’s outstanding debt

amounted to US$1,975,835.58. Solidbank’s numerous demands to pay were not heeded by Gateway. Thus,

on February 21, 2000, Solidbank filed a Complaint[9] for collection of sum of money against Gateway.

           On June 16, 2002, Solidbank filed an Amended Complaint[10] to implead the officers/stockholders of Gateway, namely, Nand K. Prasad, Andrew S. Delos Reyes, Israel F. Maducdoc, Jaime M. Hidalgo and Alejandro S. Calderon – who signed in their personal capacity a Continuing Guaranty [11] to become sureties for any and all existing indebtedness of Gateway to Solidbank. On June 20, 2002, the trial court admitted the amended complaint and impleaded the additional defendants. 

          Earlier, on October 11, 2000, Solidbank filed a Motion for Production and Inspection of Documents [12] on the

basis of an information received from Mr. David Eichler, Chief Financial Officer of  Alliance, that Gateway has

already received from Alliance the proceeds/payment of the Back-end Services Agreement. The pertinent portions

of the motion read:

             8.         Therefore, plaintiffs request that this Honorable Court issue an Order requiring defendant GEC, through its Treasurer/Chief Financial Officer, Chief Accountant, Comptroller or any such officer, to bring before this Honorable Court for inspection and copying the following documents: 

  

            a)         The originals, duplicate originals and copies of all documents   pertaining to, arising from, in connection with or involving the             Back-end Services Agreement of defendant GEC and Alliance             Semiconductors;

 b)         The originals, duplicate originals and copies of all books of account, financial

statements, receipts, checks, vouchers, invoices, ledgers and other financial/accounting records and documents pertaining to or evidencing financial and money transactions arising from, in connection with or involving the Back-end Services Agreement of defendant GEC and Alliance Semiconductors; and

             c)         The originals, duplicate originals and copies of all documents from          whatever source

pertaining to the proceeds/payments received by  GEC from Alliance Semiconductors.             d)         Documents, as used in this section, means all writings of any kind,          including the

originals and all non-identical copies, whether   different from the originals by reason of any notation made on    such copies or otherwise, including without limitation,           correspondence, memoranda, notes diaries, statistics, letters, telegrams, minutes, contracts, reports, studies, checks, statements,         receipts, returns, summaries, pamphlets, books, inter-office and         intra-office communications, notations of any sort of             conversations, telephone calls, meetings or other communications,          bulletins, printed matter, computer records, diskettes or print-outs,         teletypes, telefax, e-mail, invoices, worksheets, all drafts,             alterations, modifications, changes and amendments of any of the           foregoing, graphic or oral records or representations of any kind   (including, without limitation, photographs, charts, graphs,             microfiche, microfilm, videotapes, recordings, motion pictures,   CD-ROM’s), and any electronic, mechanical or electric records or           representations (including, without limitation, tapes, cassettes,             discs, recordings and computer or computer-related memories).

             9.         Furthermore, plaintiffs request that said Order to the Treasurer/Chief Financial Officer, Chief Accountant, Comptroller of defendant GEC include the following instructions:

             a.         If the response is that the documents are not in defendant GEC’s or        the officers’

possession or custody, said officer should describe indetail the efforts made to locate said records or documents;

             b.         If the documents are not in defendant GEC’s or the officer’s      possession and control, said

officer should identify who has control and the location of said documents or records;             c.         If the request for production seeks a specific document or itemized        category that is not

in defendant GEC’s or the officer’s possession,    control or custody, the officer should provide any documents he   has that contain all or part of the information contained in the      requested document or category;

             d.         If the officer cannot furnish the originals of the documents           requested, he should

explain in detail the reasons therefore; and             e.         The officer should identify the source within or outside GEC of each of the documents he

produces.[13]

 

 

          On January 30, 2001, the trial court issued an Order[14] granting the motion for production and inspection of

documents, viz.:

             WHEREFORE, the defendant GEC is hereby ordered to bring all the records and documents, not privileged, arising from, in connection with and/or involving the Back-end Services Agreement between defendant GEC and Alliance Semiconductor Corporation, particularly to those pertaining to all payments made by Alliance Semiconductor Corporation to GEC pursuant to said Agreement, incorporating the instructions enumerated in par. 9 of the instant motion, for inspection and copying by the plaintiff, the same to be made before the Officer-In-Charge, Office of the Branch Clerk of Court on February 27, 2001 at 9:00 a.m.             SO ORDERED.[15]

  

          Gateway filed a motion to reset the production and inspection of documents to  March 29, 2001 in order to

give them enough time to gather and collate the documents in their possession. The trial court granted the motion.[16]

 

          On April 30, 2001, Solidbank filed a motion for issuance of a show cause order for Gateway’s failure to

comply with theJanuary 30, 2001 Order of the trial court.[17] In response, Gateway filed a manifestation that they

appeared before the trial court onMarch 29, 2001 to present the documents in their possession, however, Solidbank’s

counsel failed to appear on the said date.[18]  In the manifestation, Gateway also expressed their willingness to make

available for inspection at Gateway’s offices any requested document.[19]

 

          On May 31, 2001, the trial court issued an Order setting the production and inspection of documents on June

7, 2001 in the premises of Gateway.[20] It was subsequently moved to July 24, 2001. On the said date, Gateway

presented the invoices representing the billings sent by Gateway to Alliance in relation to the Back-end Services

Agreement.[21]

 

Solidbank was not satisfied with the documents produced by Gateway. Thus, on December 13, 2001,

Solidbank filed a motion to cite Gateway and its responsible officers in contempt for their refusal to produce the

documents subject of the January 30, 2001 Order. In opposition thereto, Gateway claimed that they had complied

with the January 30, 2001 Order and that the billings sent to Alliance are the only documents that they have

pertaining to the Back-end Services Agreement.[22]

           On April 15, 2002, the trial court issued an Order[23] denying the motion to cite Gateway for contempt. However, the trial court chastised Gateway for exerting no diligent efforts to produce the documents evidencing the payments received by Gateway from Alliance in relation to the Back-end Services Agreement, viz.: 

            Before this Court is a Motion to Cite Defendant GEC In Contempt For Refusing To Produce Documents Pursuant to the Order Dated 30 January 2001 filed by plaintiff dated December 12, 2001, together with defendant GEC’s Opposition thereto dated January 14, 2002, as well as plaintiff’s Reply dated February 6, 2002 and GEC’s Rejoinder dated February 27, 2002.             As Courts are cautioned to utilize the power to punish for contempt on the preservative and not on the vindictive, contempt being drastic and extraordinary in nature (Wicker vs. Arcangel,

252 SCRA 444; Paredes-Garcia vs. CA, 261 SCRA 693), this Court is inclined to DENY the present motion.             However, as no diligent effort was shown to have been exerted by defendant GEC to produce the documents enumerated in the Order dated January 30, 2001, this Court hereby orders, in accordance with Sec. 3(a), Rule 29 of the Rules of Court, that the matters regarding the contents of the documents sought to be produced but which were not otherwise produced by GEC, shall be taken to be established in accordance with plaintiff’s claim, but only for the purpose of this action.             SO ORDERED.[24]

 

          Gateway filed a partial motion for reconsideration of the April 15, 2002 Order. However, the same was denied

in an Order[25]dated August 27, 2002.

 

          On November 5, 2002, Gateway filed a petition for certiorari[26] before the Court of Appeals (CA) seeking to

nullify the Orders of the trial court dated April 15, 2002 and August 27, 2002.

 

          On June 2, 2004, the CA rendered a Decision[27] nullifying the Orders of the trial court dated April 15,

2002 and August 27, 2002.  The CA ruled that both the Motion for Production of Documents and the January 30,

2001 Order of the trial court failed to comply with the provisions of Section 1, Rule 27 of the Rules of Court. It

further held that  the trial court committed grave abuse of discretion in ruling that the matters regarding the contents

of the documents sought to be produced but which were not produced by Gateway shall be deemed established in

accordance with Solidbank’s claim.  The fallo of the Decision reads:

 WHEREFORE, the instant petition is hereby GRANTED.  Accordingly, the assailed

portion of the Order dated April 15, 2002 and Order dated August 27, 2002, both issued by public respondent, are hereby NULLIFIED and SET ASIDE without prejudice to the filing by private respondent of a new Motion for Production and Inspection of Documents in accordance with the requirements of the Rules.             SO ORDERED.[28]

 

 

          Solidbank filed a motion for reconsideration of the Decision of the CA. On July 29, 2004, the CA rendered a

Resolution[29]denying the same.   Thus, this petition.

 

The Issues

 

I.       Whether Solidbank’s motion for production and inspection of documents and the Order of the trial court dated

January 30, 2001 failed to comply with Section 1, Rule 27 of the Rules of Court; and

 

II.      Whether the trial court committed grave abuse of discretion in holding that the matters subject of the

documents sought to be produced but which were not produced by Gateway shall be deemed established in

accordance with Solidbank’s claim.

 

The Ruling of the Court

 

We resolve to deny the petition.

 

I

 

          Section 1, Rule 27 of the Rules of Court provides: 

            SECTION 1.  Motion for production or inspection; order. – Upon motion of any party showing good cause therefor, the court in which an action is pending may (a) order any party to produce and permit the inspection and copying or photographing, by or on behalf of the moving party, of any designated documents, papers, books, accounts, letters, photographs, objects or tangible things, not privileged, which constitute or contain evidence material to any matter involved in the action and which are in his possession, custody or control; or (b) order any party or permit entry upon designated land or other property in his possession or control for the purpose of inspecting, measuring, surveying, or photographing the property or any designated relevant object or operation thereon.  The order shall specify the time, place and manner of making the inspection and taking copies and photographs, and may prescribe such terms and conditions as are just.   

     The aforecited rule provides the mechanics for the production of documents and the inspection of things

during the pendency of a case. It also deals with the inspection of sources of evidence other than documents, such as

land or other property in the possession or control of the other party.[30] This remedial measure is intended to assist in

the administration of justice by facilitating and expediting the preparation of cases for trial and guarding against

undesirable surprise and delay; and it is designed to simplify procedure and obtain admissions of facts and evidence,

thereby shortening costly and time-consuming trials. It is based on ancient principles of equity . More specifically,

the purpose of the statute is to enable a party-litigant to discover material information which, by reason of an

opponent's control, would otherwise be unavailable for judicial scrutiny, and to provide a convenient and summary

method of obtaining material and competent documentary evidence in the custody or under the control of an

adversary. It is a further extension of the concept of pretrial.[31]

 

The modes of discovery are accorded a broad and liberal treatment.[32] Rule 27 of the Revised Rules of

Court permits “fishing” for evidence, the only limitation being that the documents, papers, etc., sought to be

produced are not privileged, that they are in the possession of the party ordered to produce them and that they are

material to any matter involved in the action.[33] The lament against a fishing expedition no longer precludes a party

from prying into the facts underlying his opponent’s case. Mutual knowledge of all relevant facts gathered by both

parties is essential to proper litigation. To that end, either party may compel the other to disgorge whatever facts he

has in his possession.[34] However, fishing for evidence that is allowed under the rules is not without

limitations.   In Security Bank Corporation v. Court of Appeals, the Court enumerated the requisites in order that a

party may compel the other party to produce or allow the inspection of documents or things, viz.: 

(a)      The party must file a motion for the production or inspection of documents or things, showing good cause therefor;

 (b)     Notice of the motion must be served to all other parties of the case;

 (c)     The motion must designate the documents, papers, books, accounts, letters,

photographs, objects or tangible things which the party wishes to be produced and inspected;

           (d)     Such documents, etc., are not privileged; 

(e)      Such documents, etc., constitute or contain evidence material to any matter involved in the action, and

 (f)      Such documents, etc., are in the possession, custody or control of the other party.

[35]         

 

In the case at bench, Gateway assigned to Solidbank the proceeds of its Back-end Services Agreement

with Alliance in PN Nos. 97-375 and 97-408. By virtue of the assignment, Gateway was obligated to remit to

Solidbank all payments received fromAlliance under the agreement. In this regard, Solidbank claims that they have

received information from the Chief Financial Officer ofAlliance that Gateway had already received payments under

the agreement. In order to ascertain the veracity of the information, Solidbank availed of the discovery procedure

under Rule 27. The purpose of Solidbank’s motion is to compel Gateway to produce the documents evidencing

payments received from Alliance in connection with the Back-end Services Agreement.

 

Solidbank was able to show good cause for the production of the documents. It had also shown that the said

documents are material or contain evidence relevant to an issue involved in the action. However, Solidbank’s

motion was fatally defective and must be struck down because of its failure to specify with particularity the

documents it required Gateway to produce. Solidbank’s motion for production and inspection of documents called

for a blanket inspection. Solidbank’s request for inspection of “all documents pertaining to, arising from, in

connection with or involving the Back-end Services Agreement”[36] was simply too broad and too generalized in

scope.

 

A motion for production and inspection of documents should not demand a roving inspection of a

promiscuous mass of documents. The inspection should be limited to those documents designated with sufficient

particularity in the motion, such that the adverse party can easily identify the

documents he is required to produce.[37]

          Furthermore, Solidbank, being the one who asserts that the proceeds of the Back-end Services Agreement

were already received by Gateway, has the burden of proof in the instant case. Burden of proof is the duty of a party

to present evidence on the facts in issue necessary to establish his claim or defense by the amount of evidence

required by law.[38]  Throughout the trial, the burden of proof remains with the party upon whom it is imposed,[39]  until he shall have discharged the same.

 

II

         

          The trial court held that as a consequence of Gateway’s failure to exert diligent effort in producing the

documents subject of the Order dated January 30, 2001, in accordance with Section 3(a), Rule 29 [40] of the Rules of

Court, the matters regarding the contents of the documents sought to be produced but which were not produced by

Gateway, shall be considered as having been established in accordance with Solidbank’s claim.

We hold that the trial court committed grave abuse of discretion in issuing the aforesaid Order. It is not fair

to penalize Gateway for not complying with the request of Solidbank for the production and inspection of

documents, considering that the documents sought were not particularly described. Gateway and its officers can only

be held liable for unjust refusal to comply with the modes of discovery if it is shown that the documents sought to be

produced were specifically described, material to the action and in the possession, custody or control of Gateway.

 

Neither can it be said that Gateway did not exert effort in complying with the order for production and

inspection of documents since it presented the invoices representing the billings sent by Gateway to Alliance in

relation to the Back-end Services Agreement.  Good faith effort to produce the required documents must be

accorded to Gateway, absent a finding that it acted willfully, in bad faith or was at fault in failing to produce the

documents sought to be produced.[41]

 

One final note. The CA decision nullifying the orders of the trial court was without prejudice to the filing

by herein petitioner of a new motion for Production and Inspection of Documents in accordance with the Rules. It

would have been in the best interest of the parties, and it would have saved valuable time and effort, if the petitioner

simply heeded the advice of the CA.

         

          WHEREFORE, in view of the foregoing, the instant petition is DENIED for lack of merit.

 

SO ORDERED.

  

                                      ANTONIO EDUARDO B. NACHURA

                                      Associate Justice    WE CONCUR:   

CONSUELO YNARES-SANTIAGOAssociate Justice

Chairperson    

MA. ALICIA AUSTRIA-MARTINEZAssociate Justice

MINITA V. CHICO-NAZARIOAssociate Justice

    

RUBEN T. REYESAssociate Justice

   

A T T E S T A T I O N 

          I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.   

                                      CONSUELO YNARES-SANTIAGO                                      Associate Justice

                                      Chairperson, Third Division    

C E R T I F I C A T I O N           Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.   

                                      REYNATO S. PUNO                                      Chief Justice

[1]               RULES OF COURT, RULE 45.

[2]               Rollo, pp. 117-136.[3]               Id. at 208-211.[4]               Id. at 9.[5]               Id. at 208.[6]               Id. at 209.[7]               The Back-end Services Agreement is a business venture entered into by Gateway and Alliance wherein Gateway for consideration, agreed to perform services on integrated circuit devices owned by Alliance. It contains provisions on wafer sort, burn-in, test, engineering, marking, assembly, packaging and associated services on integrated circuit devices;rollo,  pp. 212-227.[8]               Rollo, pp. 208-209.[9]               Id. at 200-206.[10]             Id. at 117-136.[11]             Id. at 312-313.[12]             Id. at 127-132.[13]             Id.[14]             Penned by Judge Renato G. Quilala of the Regional Trial Court of  Makati City, Branch 57; rollo, p.  133.[15]             Id.[16]             Id. at 16.[17]             Id. [18]             Id. at 1317.[19]             Id. at 16.[20]             Id. at 17.[21]             Id. at 17; 1318.[22]             Id. at 17.[23]             Id. at 114.[24]             Id. at. 114.[25]             Id. at 116.[26]             RULES OF COURT, Rule 65.[27]             Penned by Associate Justice Mariano C. Del Castillo, with Associate Justices Roberto A. Barrios and Magdangal M. De Leon concurring; rollo, pp. 6- 26.[28]             Rollo, p. 26.[29]             Id. at 28.[30]             Regalado, Florenz D., Remedial Law Compendium, Vol. II, 8th ed., p. 650.[31]             27 C.J.S. Discovery § 71 (2008).[32]             Rosseau v. Langley, 7 F.R.D. 170 (1945).[33]             Supra note 30.[34]             Security Bank Corporation v. Court of Appeals, G.R. No. 135874, January 25, 2000, 323 SCRA 330.[35]             Id.[36]             Supra note 12.[37]             In Archer v. Cornillaud [41 F.Supp. 435(1941)], an action was filed to recover wages allegedly due from employer under Fair Labor Standards Act of 1938, plaintiff's motion to require defendant to produce and to permit plaintiff to inspect, copy and photograph all records, papers, books, etc., pertaining to nature and extent of defendant's business and his wholesale and retail transactions and interstate and intrastate transactions, and names and addresses of those with whom the transactions were had was too broad. The plaintiff's motion does not ask for designated documents but demands “all records, papers, books,” etc. The motion goes far beyond the scope and purpose of the rule on discovery. It is well settled by numerous decisions that the rule was never intended to permit a party to engage in a “fishing expedition” among the books and papers of the adverse party.             In Dickie v. Austin [4 N.Y.Civ.Proc.R. 123, 65 How. Pr. 420 (1883)], plaintiff claimed that he was to receive one-third of the gross profits on certain sales made by him for the defendants; that settlements were had from time to time on statements furnished by the defendants, and defendants unlawfully deducted from the plaintiff's share of the profits “certain sums,” amounting in the aggregate to $2,000, for which action was brought; that plaintiff was “unable to name specifically all the books which would be necessary,” and desired an inspection of any books which defendants might have relating to the transactions in which plaintiff was interested. Held that, the discovery sought being unusually broad and sweeping, and not such as courts are in the habit of granting in aid of common-law actions for the recovery of a specific sum of money, the application should be refused.

[38]             RULES OF COURT, Rule 131, Sec. 1.[39]             Bautista v. Sarmiento, No. L-45137, September 23, 1985.[40]          SEC. 3.  Other consequences. – If any party or an officer or managing agent of a party refuses to obey an order made under section 1 of this Rule requiring him to answer designated questions, or an order under Rule 27 to produce any document or other thing for inspection copying or photographing or to permit it to be done, or to permit entry upon land or other property, or an order made under Rule 28 requiring him to submit to a physical or mental examination, the court may make such orders in regard to the refusal as are just, and among others the following:                 (a)           An order that the matters regarding which the questions were asked, or the character or description of the thing or land, or the contents of the paper, or the physical or mental condition of the party, or any other designated facts shall be taken to be established for the purposes of the action in accordance with the claim of the party obtaining the order;                 (b)           An order refusing to allow the disobedient party to support or oppose designated claims or defenses or prohibiting him from introducing in evidence designated documents or things or items of testimony, or from introducing evidence of physical or mental condition;                 (c)           An order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party; and                 (d)           In lieu of any of the foregoing orders or in addition thereto, an order directing the arrest of any party or agent of a party for disobeying any of such orders except an order to submit to a physical or mental examination.[41]          GOOD-FAITH EFFORT

“We do not, however, completely rest our holding on this factor of ‘control.’ We find instead that the primary dispositive issue is whether Stripling made a good faith effort to obtain the documents over which he may have indicated he had ‘control’ in whatever sense, and whether after making such a good faith effort he was unable to obtain and thus produce them. … There is no evidence Stripling acted willfully, in bad faith or was at fault in failing to produce the documents which he attempted and was unable to obtain. Since Stripling’s noncompliance with the production order was due to his inability, after a good faith effort, to obtain these documents, the district court abused its discretion in dismissing his counterclaim.” Federal Practice and Procedure, 8A FPF § 2210, citing Searock v. Stripling, C.A. 11th, 1984, 736 F.2d 650, 654. 

Republic of the PhilippinesSUPREME COURTManila

THIRD DIVISION

G.R. No. 133710             January 13, 2004

PHILIPPINE BANKING CORPORATION, petitioner, vs.COURT OF APPEALS and AMALIO L. SARMIENTO, doing business under the firm name "A.L. SARMIENTO CONSTRUCTION,"respondents.

D E C I S I O N

CORONA, J.:

Before us is a petition for review seeking the reversal of the decision of the Court of Appeals1 dated October 22, 1997, which affirmed with modification the decision of the Regional Trial Court, Branch 20, Makati City,

dismissing the complaint filed by petitioner Philippine Banking Corporation against private respondent Amalio L. Sarmiento, as well as the resolution of the Court of the Appeals dated May 14, 1998 denying petitioner’s motion for reconsideration.

The facts follow.

Amalio L. Sarmiento, registered owner of A.L. Sarmiento Construction, applied for a loan from Philippine Banking Corporation in the sum ofP4,126,000, evidenced by promissory note no. 626-84. Pursuant thereto, Sarmiento obligated himself to pay the amount with interest at the rate of 29% per annum. Additionally, it was stipulated that if payment was not made upon maturity of the loan, penalty charges of 1% per month and 25% of the total amount due would be charged against him. Sarmiento signed the aforesaid promissory note together with the disclosure statement on loan/credit transaction provided by the bank.

Sarmiento failed to pay the aforesaid obligation on maturity, prompting Philippine Banking Corporation to send him a letter of demand dated January 2, 1989. Despite the demand, however, Sarmiento still failed to settle his indebtedness. Thus, on February 20, 1989, Philippine Banking Corporation filed a complaint for a sum of money against him. In his answer, Sarmiento denied that he received the proceeds of the loan transaction and prayed that the case against him be dismissed.

On August 26, 1991, the trial court rendered its decision, thus:

WHEREFORE, in view of the foregoing, plaintiff has miserably failed to prove its case by preponderance of evidence. The above-entitled case is ordered dismissed with costs against plaintiff.

Judgment over counterclaim in the sum of P30,000.00 as attorney’s fees and P20,000.00 as litigation expenses is hereby awarded in favor of the defendant. No moral or exemplary damages adjudged.2

On September 25, 1991, Philippine Banking Corporation filed a motion for new trial which the trial court subsequently granted despite the opposition of Sarmiento.

On August 3, 1992, after the reception of evidence, the trial court rendered a decision finding the evidence adduced by the bank to be insufficient to substantiate its claim. The trial court reinstated its earlier dismissal of the case against Sarmiento and denied Philippine Banking Corporation’s subsequent motion for reconsideration.

Aggrieved, Philippine Banking Corporation appealed to the Court of Appeals raising the following assignments of error:

First Assignment of Error

THE TRIAL COURT ERRED IN NOT FINDING THAT PLAINTIFF-APPELLANT HAS ESTABLISHED ITS CAUSE OF ACTION WITH AN OVERWHELMING PREPONDERANCE OF EVIDENCE

Second Assignment of Error

THE TRIAL COURT ERRED IN CONCLUDING THAT WHEN PLAINTIFF-APPELLANT WITHDREW THE AMOUNT OFP4,126,000.00 SIMULTANEOUSLY TO THE TIME THAT IT CREDITED THE SAME TO DEFENDANT’S ACCOUNT, PLAINTIFF BANK ABORTED THE LOAN TRANSACTION UNDER PROMISSORY NOTE 626-84

Third Assignment of Error

THE TRIAL COURT SERIOUSLY ERRED IN AWARDING DEFENDANT-APPELLEE P30,000.00 AS ATTORNEY’S FEES ANDP20,000.00 AS LITIGATION EXPENSES, THE SAME BEING WITHOUT FACTUAL AND LEGAL BASIS, AND EXCESSIVE UNDER THE CIRCUMSTANCES.3

On October 22, 1997, the Court of Appeals affirmed with modification the trial court’s decision:

WHEREFORE, the August 3, 1992 decision appealed from is MODIFIED to delete the trial court’s award of attorney’s fees. The rest is AFFIRMED in toto.4

Hence, the instant petition anchoring its plea for reversal on the following errors allegedly committed by the Court of Appeals:

IN NOT HOLDING THAT PETITIONER HAS OVERCOME ITS BURDEN OF PROOF THROUGH THE PRESENTATION OF OVERWHELMING PREPONDERANCE OF EVIDENCE ESTABLISHING ITS CAUSE OF ACTION

IN NOT HOLDING THAT THE RESPONDENT’S EVIDENCE FAILED TO SUCCESSFULLY CONTROVERT HIS OWN JUDICIAL ADMISSION OF THE GENUINENESS AND DUE EXECUTION OF THE ACTIONABLE DOCUMENTS UPON WHICH THE PETITIONER’S CAUSE OF ACTION IS BASED

IN NOT HOLDING THAT THE SUBJECT PROMISSORY NOTE WAS EXECUTED BY THE RESPONDENT FOR A VALID CONSIDERATION

IN NOT HOLDING THAT PETITIONER’S EVIDENCE HAS SUFFICIENTLY SHOWN THAT THE RESPONDENT RECEIVED THE PROCEEDS OF THE SUBJECT PROMISSORY NOTE

IN AWARDING LITIGATION EXPENSES FOR P20,000.00 WITHOUT LEGAL BASIS.

Petitioner contends that the appellate court incorrectly upheld the trial court’s misinterpretation of the clear import of the entries in the bank statement. Said document showed that the proceeds of the loan obtained by respondent Sarmiento under promissory note no. 626-64 had been credited to his current account no. 1025-00815-0 maintained at petitioner’s New Manila Branch in the name of A.L. Sarmiento Construction. Petitioner further alleges that its cause of action against respondent Sarmiento was predicated upon actionable documents, the due execution and authenticity of which respondent admitted. Thus, no proof was required of petitioner to establish the contents of the said documents because such judicial admissions of respondent created a prima facie case in petitioner’s favor.

We disagree.

It is undisputed that respondent Sarmiento signed the promissory note and the accompanying disclosure statement on loan/credit transaction. But said pieces of evidence proved only the existence of such documents. There was even no question as to that because respondent Sarmiento himself admitted the due execution thereof. The important issue was whether or not respondent Sarmiento actually received the proceeds of the subject loan so as to make him liable therefor, a matter which should have been ventilated before the trial court.

The trial court did in fact make a finding that the documentary evidence of petitioner failed to prove anything showing that respondent indeed received the proceeds of the loan. The Court of Appeals affirmed the conclusions of the trial court and declared:

A pre-existing obligation, it may be conceded, constitutes value and may, of and by itself, serve as valuable and sufficient consideration for a contract such as the loan sued upon. As an essential element of a contract, however, the same should have been satisfactorily proved by the appellant – particularly when, as in the instant case, the absence of consideration was precisely put in issue by the pleadings and was buttressed by both oral and documentary evidence. Having failed in this material respect, the

appellant’s withdrawal of the amount supposedly credited to the appellee’s account was understandably interpreted by the court a quo as a termination/cancellation of the loan the latter applied for. Considering further that contracts without consideration do not exist in contemplation of law and produce no effect whatsoever (Article 1352, Civil Code of the Philippines), the trial, likewise, correctly dismissed the appellant’s case.5 (emphasis supplied)

A statement in a written instrument regarding the payment of consideration is merely in the nature of a receipt and may be contradicted.6Respondent Sarmiento denied having received the proceeds of the loan and in fact presented evidence showing that on the day petitioner claimed to have credited the subject amount, it was again debited or withdrawn by petitioner, admittedly upon the instruction of the officials from petitioner’s head office. Petitioner attempted to controvert this fact by claiming that the proceeds of the loan were applied to respondent’s previous obligations to the bank. But we find nothing in the records showing that respondent had other obligations to which the proceeds of the loan could or should have been applied. Moreover, petitioner failed to explain just exactly what said obligations were or to what extent the purported proceeds were applied in satisfaction thereof. What appeared clearly was that the proceeds of the loan were deposited then withdrawn the same day by petitioner itself, thus negating its claim that respondent actually received it. Petitioner therefore failed to establish its case against respondent Sarmiento.

Be that as it may, the general rule is that only questions of law may be raised in a petition for review on certiorari. The appellate jurisdiction of this Court in cases brought to it from the Court of Appeals is limited to reviewing and correcting the errors of law committed by the latter, the findings of fact of the Court of Appeals being final and conclusive. In other words, the power of this Court is limited to determining whether the legal conclusions drawn from the findings of fact are correct. Barring a showing that the findings of fact complained of are totally devoid of support in the records, such determination must stand for the Court is neither expected nor required to examine or refute the oral and documentary evidence submitted by the parties.7

Finally, the award of litigation expenses in the sum of P20,000 should be deleted for lack of legal basis.

WHEREFORE, the instant petition for certiorari is hereby DENIED. The assailed decision and resolution of the Court of Appeals are AFFIRMED, subject to the MODIFICATION that the award of P20,000 as litigation expenses is hereby deleted.

SO ORDERED.

Vitug, (Chairman), Sandoval-Gutierrez, and Carpio-Morales, JJ., concur.

Footnotes

1 Penned by Associate Justice Fermin A. Martin, Jr. and concurred in by Associate Justices Jesus M. Elbinias and Ruben T. Reyes.

2 Rollo, p. 48.

3 Rollo, pp. 51-52.

4 Rollo, p. 55.

5 Rollo, p. 54.

6 Maulini vs. Serrano, 28 Phil. 640 [1914].

7 Reyes, et. al. vs. CA, 383 SCRA 471 [2002].

G.R. NO. 122472. July 17, 2006]

APEX MINING CO., INC. vs. COMMISSIONER OF INTERNAL REVENUE AND COURT OF APPEALS

Special Third Division

Sirs/Mesdames:

Quoted hereunder, for your information, is a resolution of this Court dated JULY 17, 2006.

G.R. NO. 122472 (APEX Mining Co., Inc. vs. Commissioner of Internal Revenue and Court of Appeals)

In our Resolution of February 15, 2006,[1] we denied with finality petitioner's Motion for Reconsideration/ with its Supplement dated December 5, 2005, of our Decision dated October 20, 2005 which denied the petition for review on certiorari.  Presently, petitioner is again with us, this time thru the instant Second Motion for Reconsideration,[2] the accompanying Motion for Leave to Admit[3] having been granted per Resolution of April 3, 2006,[4] and to which the Office of the Solicitor General filed its comment.[5]

We resolve to DENY, as we hereby deny with finality, the subject Second Motion for Reconsideration.

Section 2, Rule 52 of the Rules of Court is explicit that no second motion for reconsideration of a judgment or final resolution by the same party shall be entertained.  Verily, such motion is a prohibited pleading,[6] hence, shall not be allowed, except for extraordinarily persuasive reasons and only after an express leave shall have first been obtained.[7]

A grant of a motion for leave to admit a second motion for reconsideration does not necessarily imply that the grounds relied upon in such second motion partake of an extraordinary persuasive reason to except such motion from the one-motion rule.  And the fact that the Court ignored the allegations in the supplement to the first motion which, to petitioner, are valid and compelling reasons to justify reconsideration, and then proceeded to declare the same motion to be bereft of merit would not constitute a ground for, or lend exceptional dimension to the, second motion for reconsideration.

It may be that the Court "noted without action" the supplement to the first motion for reconsideration.   Any suggestion, however, that the Court, in disposing of said motion, did not take stock of or consider the averments in the supplement is unacceptable.

Needless to stress, allowing reconsideration does not peremptorily impose on the Court the obligation to deal and pass upon individually and specifically on all grounds relied upon therefor, for this exercise could be a useless formality of ritual invariably involving merely a reiteration of the reasons already set forth in the final judgment or order for rejecting the arguments advanced by the movant.[8]  As a matter of long practice, it would suffice to deal generally and summarily with the motion for reconsideration, and merely state a ground for its denial, [9] as what we did in our Resolution of February 15, 2006.

Thus, the denial of a motion for reconsideration signifies that the grounds relied upon have been found, upon due deliberation, to be without merit, or, with like effect, as not being of sufficient weight to warrant a modification of the judgment or final order.

Given the above perspective, the insistent reason petitioner cited to support its plea for reconsideration,  i.e., suspension of the procedural rules, is undeserving of merit, the same having been considered in the course of the denial of the first motion for reconsideration.

Lastly, it may not be amiss to point out that the denial of petitioner's first motion for reconsideration was "with finality".  Although the presence or absence of the term "with finality" does not in any way suggest uncertainty or indecisiveness on the part of the Court regarding its denial of reconsideration or expectation of another reconsideration, nonetheless the modifier serves to emphasize the import and effect of the denial, to wit: that the Court will entertain and consider no further arguments or submissions respecting the correctness of its final ruling;

that, in its view, nothing more is left to be discussed, clarified or done in the case, all issues raised having been passed upon and definitely resolved, and any other which could have been raised, but were not, having been waived and no longer available as ground for a second motion.[10]  Simply stated, a denial with finality stresses that the case is deemed closed.

WHEREFORE, the instant Second Motion for Reconsideration is hereby DENIED with finality.  Furthermore, no further pleadings, motions or papers shall be filed in this case.

SO ORDERED.

Very truly yours,

(Sgd.) LUCITA ABJELINA-SORIANO

Clerk of Court

[1] Rollo, p. 261.[2] Rollo, pp. 263-273.[3] Rollo, pp. 253-258.[4] Rollo, p. 276.[5] Rollo, pp. 277-278.[6] Hongria vs. Hongria-Juarde, G.R. No. 155086, March 15, 2004 425 SCRA 504, 507.[7] Ortigas and Co. Ltd. Partnership vs. Velasco, G.R. No. 109645, March 4, 1996, 254 SCRA 234, 240 cited in Manila Electric Co. vs. Barlis, G.R. No. 114231, June 29, 2004, 433 SCRA 11, 28.[8] Ortigas and Co. Ltd. Partnership vs. Velasco G.R. No. 109645, March 4, 1996, 254 SCRA 234, 242.[9] Section 14, Art. VIII, Constitution.[10] Ortigas & Co., Ltd. vs. Velasco, supra at pp. 243-244.

Republic of the PhilippinesSUPREME COURT

Manila

SECOND DIVISION

G.R. No. 167361             April 2, 2007

LAND BANK OF THE PHILIPPINES, Petitioner, vs.HEIRS OF FERNANDO ALSUA, namely: CLOTILDE S. ALSUA, ROBERTO S. ALSUA, MA. ELENA S. ALSUA and RAMON ALSUA,Respondents.

D E C I S I O N

TINGA, J.:

On appeal via a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure are the Decision1 dated 17 September 2004 and Resolution2 dated 4 March 2005 of the Court of

Appeals in CA-G.R. SP No. 76364. The assailed Decision upheld the dismissal order of the Regional Trial Court (RTC), Branch 3, Legazpi City in the petition for determination of just compensation filed by Land Bank of the Philippines (LBP), while the Resolution denied LBP’s motion for reconsideration.

The following factual antecedents are matters of record.

Respondents are the heirs of the late Fernando Alsua, who was the registered owner of various parcels of agricultural land with an aggregate area of approximately 50 hectares situated in Catomag, Guinobatan, Albay.

The Department of Agrarian Reform initiated proceedings to acquire respondents’ properties via the Compulsory Acquisition Scheme under the Comprehensive Agrarian Reform Law. Petitioner LBP valued the properties at P2,361,799.91, which respondents rejected. Thus, the Department of Agrarian Reform Adjudication Board (DARAB) commenced summary administrative proceedings to determine the compensation for respondents’ lands. The DARAB eventually came out with a decision fixing the value of the properties at P4,806,109.05, to which respondents opposed.

On 11 April 2002, petitioner LBP filed a petition for the determination of just compensation before the RTC, Branch 3, Legazpi City. The trial court, sitting as a Special Agrarian Court,

issued an Order on 4 December 2002 dismissing the petition for failure to prosecute within reasonable length of time. A copy of the order of dismissal was sent via registered mail and actually delivered to petitioner’s counsel on 12 December 2002.

On 27 December 2002, petitioner’s counsel sought reconsideration of the order of dismissal, citing excusable negligence due to "volume and pressure of work" as justification. After hearing on petitioner’s motion for reconsideration, the trial court denied the same because the motion for reconsideration was filed one day late and lacked merit.

Petitioner elevated to the Court of Appeals the issue of the timeliness of the filing of its motion for reconsideration. Petitioner insisted that the copy of the order of dismissal should be deemed received upon delivery to petitioner’s counsel on 12 December 2002 and not upon receipt by petitioner’s guard on duty on 11 December 2002.

On 17 September 2004, the Court of Appeals promulgated the assailed Decision, dismissing the petition for review. The appellate court ruled that petitioner’s counsel cannot complain that he did not promptly receive the copy of the order of dismissal because it was sent by registered mail to him as such counsel at his office address, based on the presumption that the order of dismissal was delivered to a person who was duly authorized to receive papers for him. The appellate court further held that petitioner’s counsel was negligent in

not inquiring exactly when the copy was received. Petitioner sought reconsideration of the Decision to no avail.

Hence, the instant petition raising the following issues:

A. THE COURT OF APPEALS SERIOUSLY ERRED WHEN IT CONSIDERED THE SERVICE TO THE SECURITY GUARD OF THE ORDER OF DISMISSAL AS VALID SERVICE TO LBP FOR PURPOSES OF COUNTING THE REGLEMENTARY PERIOD FOR THE FILING OF THE MOTION FOR RECONSIDERATION.

B. THE COURT OF APPEALS GRAVELY ERRED IN LAW WHEN, IN RESOLVING THE CASE, IT IGNORED SECTION 6, RULE I OF THE 1997 RULES OF CIVIL PROCEDURE REGARDING THE LIBERAL CONSTRUCTION OF THE RULES TO PROMOTE THEIR OBJECT AND ASSIST THE PARTIES IN OBTAINING JUST, SPEEDY AND INEXPENSIVE DETERMINATION OF EVERY ACTION OR PROCEEDING.

C. THE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION IN

DENYING THE PETITION THEREBY AFFIRMING THE STRICT OR RIGID INTERPRETATION OF A PROCEDURAL LAW BY THE [SPECIAL AGRARIAN COURT] A QUO AT THE EXPENSE OF SUBSTANTIAL JUSTICE AND THE RIGHT TO APPEAL OF PETITIONER.3

Petitioner seeks the remand of the case to the Special Agrarian Court for determination of just compensation.

Pleading for the liberal construction of procedural rules, particularly on the service of the order of dismissal, petitioner contends the fifteen-day period for the filing of its motion for reconsideration should be reckoned from the actual receipt by petitioner’s counsel of the order of dismissal and not from the delivery thereof to the security guard.

In support of this theory, petitioner cites the ruling in Lawin Security Services, Inc. v. NLRC,4 where the Court declared invalid the service of the National Labor Relations Commission resolution on the security guard of the building where counsel for the respondent was holding office. In said case, the Court held that "service of papers should be delivered personally to the attorney or by leaving [them] at his office with his clerk or with a person having charge thereof."5

The Court of Appeals cited Rule 13, Section 86 and Section 107 of the Rules of Court in disregarding petitioner’s proposition that the fifteen-day period for filing the motion for reconsideration should be reckoned from its counsel’s actual receipt of the order of dismissal. It explained that the purpose of this rule on service by registered mail is "to place the date of receipt of pleadings, judgments and processes

beyond the power of the party being served to determine at his pleasure."8

The petition has no merit.

All that the rules of procedure require in regard to service by registered mail is to have the postmaster deliver the same to the addressee himself or to a person of sufficient discretion to receive the same.9

Thus, in prior cases, a housemaid,10 or a bookkeeper of the company,11 or a clerk who was not even authorized to receive the papers on behalf of its employer,12 was considered within the scope of "a person of sufficient discretion to receive the registered mail." The paramount consideration is that the registered mail is delivered to the recipient’s address and received by a person who would be able to appreciate the importance of the papers delivered to him, even if that person is not a subordinate or employee of the recipient or authorized by a special power of attorney.

In the instant case, the receipt by the security guard of the order of dismissal should be deemed receipt by petitioner’s counsel as well.

Petitioner’s admission that there were instances in the past when the security guard received notices for petitioner LBP13 only underscores the fact that the security guard who received the order of dismissal fully realized his responsibility to deliver the mails to the intended recipient. Noteworthy also is the fact that the security guard did not delay in handing over the order of dismissal and immediately forwarded the same to petitioner’s counsel the following day. Petitioner has only itself to blame if the security guard took it upon himself to receive notices in behalf of petitioner and its counsel despite lack of proper guidelines, as alleged by petitioner. In NIAConsult, Inc. v. NLRC,14 the Court pointed out that it was the responsibility of petitioners and their counsel to devise a system for the receipt of mail intended for them. The finality of a decision is a jurisdictional event which cannot be made to depend on the convenience of a party.15

Petitioner’s reliance on the pronouncement in Lawin Security is misplaced. In said case, there was no showing that the security guard who received the copy of the subject resolution was charged with such

responsibility and that the counsel actually received said copy. In the instant case, as admitted by petitioner, the security guard who received the copy of the order of dismissal had been accustomed to the responsibility of receiving papers on behalf of petitioner and of actually delivering them to the intended recipient.

As correctly pointed out by the Court of Appeals, petitioner had only itself to blame for its failure to inquire exactly when the order was received or to assume that service of the same was effected on the day it was handed over to petitioner’s counsel.

Petitioner is correct in pointing out that the Court has ample powers to relax the rules of procedure in the interest of substantial justice and in order to allow a litigant to be given the fullest opportunity to establish the merits of his complaint. However, concomitant to a liberal application of the rules of procedure should be an effort on the part of the party invoking liberality to explain its failure to comply with the rules.16 Said rules may be relaxed only in exceptionally meritorious cases.17

The tardy filing of the motion for reconsideration of the order of dismissal was not the only procedural lapse committed by petitioner. Precisely, the Special Agrarian Court dismissed the petition

before it because of petitioner’s failure to prosecute the same for more than six months. The Court indeed observes petitioner’s tendency to trifle with court processes intended for the speedy administration of justice. To apply the liberal construction of rules of procedure in the instant case will allow petitioner to benefit from its unjustified violations of procedural rules.

WHEREFORE, the instant petition for review on certiorari is DENIED. The Decision dated 17 September 2004 and Resolution

dated 4 March 2005 of the Court of Appeals in CA-G.R. SP No. 76364 are hereby AFFIRMED. Costs against petitioner.

SO ORDERED.

DANTE O. TINGAAssociate Justice

WE CONCUR:

LEONARDO A. QUISUMBINGAssociate JusticeChairperson

ANTONIO T. CARPIOAssociate Justice

CONCHITA CARPIO MORALESAsscociate Justice

PRESBITERO J. VELASCO, JR.Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBINGAssociate JusticeChairperson, Second Division

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

REYNATO S. PUNOChief Justice

Footnotes

1 Penned by Justice Japar B. Dimaampao, and concurred in by Associate Justices Martin S. Villarama, Jr., Chairman, Fifteenth Division, and Edgardo F. Sundiam; rollo, pp. 55-64.

2 Id. at 67-68.

3 Id. at 34-35.

4 339 Phil. 330 (1997).

5 Id. at 335, citing Adamson Ozanam Educational Institution, Inc. v. Adamson University Faculty and Employees Association, G.R. No. 86819, 9 November 1989, 179 SCRA 279.

6 Section 8. Substituted service. – If service of pleadings, motions, notices, resolutions, orders and other papers cannot be made under the two preceding sections, the office and place of residence of the party or his counsel being unknown, service may be made by delivering the copy to the clerk of court, with proof of failure of both personal service and service by mail. The service is complete at the time of such delivery.

7 SEC. 10. Completeness of service. – Personal service is complete upon actual delivery. Service by ordinary mail is complete upon the expiration of ten (10) days after mailing, unless the court otherwise provides. Service by registered mail is complete upon actual receipt by the addressee, or after five (5) days from the date he received the first notice of the postmaster, whichever date is earlier.

8 Rollo, p. 62, citing NIAConsult, Inc. v. NLRC, G.R. No. 108278, 2 January 1997, 266 SCRA 17, 21.

9 Laza v. Court of Appeals, 336 Phil. 631 (1997).

10 Id.

11 Pabon v. NLRC, 357 Phil. 7 (1998).

12 G&G Trading Corporation v. Court of Appeals, No. L-78299, 29 February 1988, 158 SCRA 466.

13 Rollo, p. 38.

14 G.R. No. 108278, 2 January 1997, 266 SCRA 17.

15Id. at 17.

16 Balindong v. Court of Appeals, G.R. No. 159962, 16 December 2004, 447 SCRA 200.

17 Lazaro v. Court of Appeals, G.R. No. 137761, 386 Phil. 412 (2000).Republic of the Philippines

SUPREME COURTManila

FIRST DIVISION

G.R. No. 169372             December 6, 2006

NARCISO GUIANG, petitioners, vs.

COURT OF APPEALS, FERNANDO T. DULAY, CALLEJO, SR., and HEIRS OF CARLITO DULAY, represented by CHRISTOPHER S. DULAY, and HEIRS OF ANDRES DULAY, represented

by BEATRIZ DULAY, respondents.

DECISION

CALLEJO, SR., J.:

This is a Petition for Review on Certiorari of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 89214 and its Resolution2denying the motion for reconsideration of the said decision.

The Antecedents

Narciso Guiang was the owner of a four-hectare parcel of agricultural land situated at Cebu, San Isidro, Santiago, Isabela. The lot is covered by Original Certificate of Title (OCT) No. P-9504 of the Registry

of Deeds of Isabela. The title was based on Homestead Patent No. V-63014 which was approved on February 6, 1956.3

In September 1982, Guiang and Andres Dulay executed a contract of lease over the property. As annual rental over the landholding, Dulay obliged himself to deliver to Guiang 48 cavans of palay (50 kilos per

cavan). The parties agreed that the lease would continue until revoked, or until their contractual

relationship was terminated by law.4

Meantime, on September 22, 1987, the President, through the Secretary of Agrarian Reform, issued emancipation patents over portions of the property. Consequently, the following titles were issued in

favor of Andres Dulay and his two sons:

Patentee Emancipation Patent No.

TCT No. Area

1. Carlito T. Dulay A-120418 26619 7,080 sq m2. Carlito T. Dulay A-120422 26623 156 sq m3. Fernando T. Dulay A-120417 26618 8,825 sq m4. Fernando T. Dulay A-120421 26622 162 sq m5. Andres R. Dulay A-120419 26620 11,716 sq m

However, the patentees continued delivery to Guiang his share of the produce on the property.

Andres Dulay passed away on April 15, 1998. He was survived by his wife, Beatriz Dulay, and their children, Carlito, Ben and Fernando.

Guiang filed a Complaint for "Declaratory Relief, Recovery of Ownership and Possession of Real Property Plus Damages" against the heirs of Andres Dulay before the Regional Trial Court (RTC) of

Santiago City. He alleged the following:

3. That plaintiff, his spouse and children are desirous of personally cultivating these parcels of land and made previous demands for the defendants to vacate the same but said defendants refused to vacate,

relying on the provisions of PD 27 and RA 6657 and pertinent regulations issued by the Department of Agrarian Reform;

4. That, likewise, said defendants, since 1998, refused to pay the agreed lease rentals of 48 cavans of palay at 50 kilos per cavan, relying on the same provisions of PD 27 and RA 6657 and pertinent

regulations issued by the Department of Agrarian Reform;

5. Plaintiff is of the contention, however, that said PD 27 and RA 6657 and pertinent regulations issued by the Department of Agrarian Reform to implement the said statutes are inapplicable to the lands in

question which were acquired by the plaintiff by virtue of a Homestead Patent, relying on the pronouncement of the Supreme Court in the cases of Patricio v. Bayog, 112 SCRA 45; and in Alita v.

Court of Appeals, et al., G.R. No. 78517, February 27, 1989 wherein x x x:

x x x x

6. That Plaintiff is now constrained to come to court and in the process engaged the services of counsel for an agreed professional fee of P25,000.00 plus an appearance fee of P1,000.00 per hearing.5

Guiang prayed that, after due proceedings, judgment be rendered in his favor, thus:

WHEREFORE, it is respectfully prayed of this Honorable Court that, after due notice and hearing, judgment be rendered:

1. declaring the right of the plaintiff to have a better or superior right than defendants to take possession and cultivation over the land in question, consequently, ordering the said defendants to turn over the

possession and cultivation thereof to the plaintiff;

2. ordering the defendants to pay the plaintiff actual damages of 48 cavans of palay at 50 kilos per cavan for every cropping (at 2 croppings per year) since 1998 up to the time that said defendants shall

surrender the possession and cultivation of the land in question to the plaintiff.

3. ordering the defendants to pay plaintiff attorney’s fees in the amount of P25,000.00 plus appearance fee of counsel in the amount of P1,000.00 for every hearing;

4. ordering the defendants to pay the cost of this suit.6

In their Answer, the Dulays alleged that in the 1998 harvest season, they had informed Guiang that his share of the produce was ready for delivery. However, Guiang refused to accept his share because he

wanted the property vacated. The Dulays were then impelled to deposit the rentals with the Land Bank of the Philippines. They further insisted that in 1999 and 2000, Guiang received rentals over the

property and signed receipts therefor.

By way of special and affirmative defenses, the Dulays alleged the following:

7. That while it is true that defendants acquired title on their respective parcel of land, the same is not controlling because they never enforce their right thereto as owner and can be shown in their acts of

giving the necessary rental to the actual owner which is the plaintiff;

8. That defendants’ act of bringing the matter for mediation at the Office of the Municipal Agrarian Reform Officer (MARO) and admitting therein to be tenants of these parcel of land and not as owners

clearly indicates that they were not repudiating the right of the plaintiff but only to enforce their right as tenants and nothing else;

9. That to eject these defendants who are poor farmers from their actual cultivation on the said parcel of land without giving them the usual "DISTURBANCE COMPENSATION" is tantamount to giving them

the penalty of death.7

The Dulays failed to allege that they had already acquired ownership over the property as early as 1987, based on the emancipation patents approved by the President and the subsequent issuance of the TCTs

in their favor. A copy of the lease contract was appended to the Answer as Annex "A." However, copies of the titles issued in favor of defendants were not appended to the Answer.

The Dulays prayed that, after due proceedings, judgment be rendered in their favor, thus:

WHEREFORE, in view of all the foregoing, it is most respectfully prayed unto this Honorable Court that, after due notice and hearing, judgment be rendered:

1. declaring the defendants to be the tenants of the plaintiff and to recognize the "LEASE AGREEMENT" to be valid and enforceable;

2. declaring the defendants’ stay on the land to be lawful and in accordance with the existing laws and in case of ejectment to order the plaintiff to pay the necessary disturbance compensation provided to

tenant-tillers.

Such other relief which is just and equitable under the premises is likewise prayed for.8

During the pre-trial, the parties stipulated on the following matters:

1. The identity, location and area of the land in question, which is particularly described as Lot I, H-185146 with an area of 34,235 square meters and located in barrios Cabulay and Salvador,

municipalities of Echague and Santiago which is now San Isidro, Isabela. That this parcel of land is covered under OCT No. P-9504 and registered in the name of plaintiff Narciso Guiang;

2. The capacity of the parties to sue and to be sued, and that the plaintiff Narciso Guiang acquired this piece of land by virtue of homestead patent, as indicated in OCT No. P-9504;

3. That this land is an agricultural land and actually planted with rice and that the source of irrigation is provided by the NIA; and that said land is capable of being cultivated twice a year;

4. That the average gross production per hectare per cropping is 100 cavans with 50 kilos per cavan;

5. That the late father of the defendant Andres Dulay, who is substituted by his heirs was the tenant of Narciso Guiang, as evidenced by a document entitled "Tulag Ti Pinagabang Iti Talon"; and

6. That after the death of defendant Andres Dulay on April 15, 1998, his heirs are now succeeding in the cultivation of the land in issue up to this time.9

The parties likewise agreed to litigate the following issues:

1. Who between the parties are better entitled to possess and cultivate the land in question?

2. Who is entitled to the award of damages and attorney’s fees? and

3. As a side issue, whether or not the defendants were tenants of the plaintiff?10

Guiang filed a motion for summary judgment. He contended that as gleaned from the parties’ pleadings and what was stipulated upon, no genuine issue had been raised.

The Dulays opposed the motion, contending

1. That there is no truth that the above-entitled case has no genuine issue which necessitate the plaintiff to move for a summary judgment;

2. That in the pre-trial conference, the plaintiff never admitted that the defendants were his tenants and since the plaintiff never admitted this fact, the issue should be resolved in a full blown trial;

3. That if ever it will be considered by this Honorable Court that the defendants were the tenants of the plaintiff, the same could not be ejected from the land they till unless the plaintiff will pay them the

allowable disturbance fee as provided by law or if the plaintiff could prove that the defendants violated any of the grounds for ejecting a tenant;

4. That the act of the plaintiff in ejecting a tenant by way of filing a case against them is a clear violation of their tenancy right which is equally protected by our laws and to allow this theory will be a clear act

of circumventing the law on the matter.11

On October 1, 2002, the trial court issued an Order granting the motion for summary judgment. The

dispositive portion reads:

WHEREFORE, as a consequence of all the foregoing, the motion for summary judgment is hereby GRANTED.

Accordingly, the defendants are ordered to deliver possession and cultivation of the parcels of land covered by OCT No. P-9504; ordering them to pay rentals to the plaintiff since 1998 up to the present at the rate of 96 cavans of palay (48 cavans per cropping season) at 50 kilos per cavan of palay and lastly,

ordering them to pay attorney’s fees of Twenty-Eight Thousand (PhP28,000.00) Pesos.

SO ORDERED.12

The RTC ruled that the lot was not covered by the Comprehensive Agrarian Reform Law (CARL) or Presidential Decree (P.D.) No. 27 because it had been acquired under a homestead patent. The RTC

cited the ruling of this Court in Alita v. Court of Appeals.13 The court likewise cited the retention limits of original homestead owners or their direct compulsory heirs under Section 6, Article XIII of the

Constitution, and Section 6 of Republic Act (R.A.) No. 6657. According to the RTC, the Dulays, as tenants, were estopped from denying Guiang’s title over the property.

The Dulays, through counsel, received a copy of the Order on October 9, 2002. On November 2, 2002, the Dulays filed a motion for reconsideration, while Guiang filed a motion to execute the October 1, 2002 Order.14 Guiang alleged that the trial court’s Order had become final and executory since the

appeal was filed beyond the reglementary period.

On November 25, 2002, the RTC issued an Order denying the motion on the ground that it was belatedly filed; Guiang’s motion for a writ of execution was granted.15 A writ of execution was

subsequently issued.16

On May 15, 2003, the Dulays filed a Petition for Relief from Judgment17 before the RTC, on the ground that their failure to timely move for reconsideration of the October 1, 2002 Order was due to their

counsel’s excusable neglect. They explained that their counsel was suffering from sore eyes and double eye vision, and so was unable to prepare the necessary pleading.18 The Dulays averred that the ruling

in Paris v. Alfeche19 had already abandoned the doctrine in the Alita and Bayog cases. They pointed out that in the Paris case, the Court allowed the tenants-tillers to stay and cultivate the land, and declared

that unless there is a violation of the tenancy agreement, the tenants should not be ejected from the land.

The Dulays thus prayed that the RTC issue a writ of preliminary injunction to restrain Guiang from enforcing the order of execution.

Guiang filed an Opposition,20 contending that the petition was filed beyond the periods provided under Section 3,21 Rule 38 of the Revised Rules of Court. He, likewise, asserted that the petition was not

accompanied by a medical certificate, and that there was no authentic proof that, indeed, the counsel was on official leave of absence due to illness as claimed by the Dulays.

On February 8, 2005, the RTC issued a Resolution22 dated January 8, 2005 denying the petition for relief from judgment. The RTC ruled that the petition was belatedly filed since more than seven months

had lapsed from the filing of the petition. Contrary to defendants’ claim, the reckoning point of the reglementary period is the date of receipt of the Order – October 9, 2002. Moreover, the Dulays failed to

show the existence of fraud, accident, mistake and excusable negligence, or that they had a good and substantial defense; at the very least, a medical certificate should have been attached to the

petition.23 The RTC also found that Guiang had been tilling the land since 1956. It pointed out that under Section 6 of R.A. No. 6657, the homestead grantee has the right to retain the property, and that lot

is exempt from the CARL.24

Aggrieved, the Dulays filed a petition for certiorari25 under Rule 65 of the Revised Rules of Court before the CA, alleging that:

A.

THE PETITIONERS ARE THE TENANTS-BENEFICIARIES OF THE AGRICULTURAL LAND IN QUESTION AS THEY WERE ISSUED FIVE (5) TITLES OF OWNERSHIP BY THEN PRESIDENT

CORAZON C. AQUINO THROUGH THE DEPARTMENT OF AGRARIAN REFORM ON SEPTEMBER 22, 1987 BY AUTHORITY OF THE PROVISIONS OF PRESIDENTIAL DECREE

NO. 266 DATED AUGUST 4, 1973, ISSUED IN RELATION TO PRESIDENTIAL DECREE NO. 27 DATED OCTOBER 21, 1972; (SEE: ANNEXES "U," "V," "W," "X" AND "Y") ERGO, REPUBLIC

ACT 6657 APPLIES AND JURISDICTION PERTAINS THEREFOR TO THE DARAB.

B.

THE PETITIONERS PRIOR TO THE ISSUANCE OF THE FIVE (5) EMANCIPATION PATENTS IN THEIR FAVOR ARE THE TENANTS OF THE PRIVATE RESPONDENT SINCE 1961. IN

FACT, THEY EXECUTED AN AGRICULTURAL LEASEHOLD CONTRACT IN 1982. (See Annex "I-1")

C.

THE ALLEGATIONS OF THE AMENDED COMPLAINT (See: ANNEX "H-1") CLEARLY SHOW THE EXISTENCE OF TENANCY RELATIONSHIP BETWEEN THE PETITIONERS AND THE

PRIVATE RESPONDENT. THIS BEING THE CASE, JURISDICTION PERTAINS THEREFORE TO THE DARAB UNDER SECTION 50 OF REPUBLIC ACT 6657.26

They alleged that since a tenancy relationship existed between the parties, it is the DAR Adjudication Board (DARAB), not the RTC, which had jurisdiction over the case. They pointed out that all the requisites of a tenancy relationship existed: Guiang is the owner of the agricultural lots; Guiang

consented to the lease; the purpose of the leasehold contract was to bring about agricultural production; they actually cultivated the subject property; and there was sharing in the harvest.27 Petitioners cited the case of Paris v. Alfeche28 to support their contention that homesteads are not exempt from the operation

of the Land Reform Law.29

In his Comment30 on the petition, Guiang averred that the RTC validly assumed jurisdiction over the case. Under Rule 63 of the Revised Rules of Court, a petition for declaratory relief, recovery of

ownership and possession and damages is within the jurisdiction of the RTC. Moreover, the land was acquired by virtue of a homestead patent, and thus exempt from the coverage of agrarian reform law,

and outside the jurisdiction of the DARAB.31

On June 20, 2005, the CA rendered the assailed Decision32 granting the petition. The fallo reads:

WHEREFORE, premises considered, the present petition is hereby GIVEN DUE COURSE and the writ prayed for accordingly GRANTED. The assailed Order dated October 1, 2002 and Resolution dated

January 8, 2005 but issued on February 8, 2005 of the court a quo in Civil Case No. 36-2894 are hereby ANNULLED and SET ASIDE. A new judgment is hereby entered DISMISSING private respondent’s

complaint for lack of jurisdiction. Respondent Judge is hereby enjoined from further hearing the case or otherwise proceeding with the implementation of the aforesaid order and resolution.

No pronouncement as to costs.

SO ORDERED.33

The CA ruled that, while Guiang had the unqualified right to retain the landholding as the original homestead, it does not follow that the actual and legitimate tenant-tillers are no longer entitled to the

protection of the law.34 The very allegations of the complaint show that the controversy is essentially an agrarian dispute; thus, it is clearly the DARAB and not the RTC which has jurisdiction.35

The CA held that since the decision sought to be annulled was rendered by a court that had no jurisdiction, thus, a void judgment, the issue of the timeliness of the petition for relief from judgment is immaterial. The ruling of the RTC is a total nullity and can never become final; any writ of execution

based on it is void.36

Guiang filed a motion for reconsideration, which the appellate court likewise denied in its Resolution37 dated August 23, 2005.

Guiang, now petitioner, comes before the Court and alleges the following to support the instant petition:

I.

THE HONORABLE COURT OF APPEALS, WITH DUE RESPECT, ERRED IN GRANTING THE WRIT OF CERTIORARI IN CA-G.R. SP NO. 89214 AND IN ANNULLING AND SETTING ASIDE

THE DECISION OF THE LOWER COURT IN CIVIL CASE NO. 36-2894 AND IN DISMISSING THE COMPLAINT FOR LACK OF JURISDICTION, BECAUSE SAID DECISION OF THE

HONORABLE COURT OF APPEALS IS CLEARLY NOT IN ACCORD WITH THE PROVISIONS OF SECTION 6, ART. XIII OF THE 1987 CONSTITUTION, AND SECTION 6, OF RA 6657, AND

THE DOCTRINAL RULINGS IN THE CASE OF PATRICIO V. BAYOG, 112 SCRA 45, REITERATED INALITA V. COURT OF APPEALS, ET AL., G.R. NO. 78517, FEBRUARY 27, 1989,

WHICH EXEMPT LANDS OBTAINED THROUGH HOMESTEAD PATENT FROM THE COVERAGE OF P.D. 27, AND R.A. 6657.

II.

THE HONORABLE COURT OF APPEALS LIKEWISE ERRED IN CONCLUDING THAT THE REGIONAL TRIAL COURT HAS NO JURISDICTION OVER THE SUBJECT MATTER, DESPITE

THE GLARING FACT THAT LANDS OBTAINED THROUGH HOMESTEAD PATENT IS CONSTITUTIONALLY EXCLUDED FROM THE LAND OR AGRARIAN REFORM.

III.

THE HONORABLE COURT OF APPEALS THEN ERRED IN ITS CONCLUSION THAT THIS CASE IS AN "AGRARIAN DISPUTE" WHICH IS WITHIN THE JURISDICTION OF THE DAR

ADJUDICATION BOARD (DARAB) DESPITE THE CONSTITUTIONAL EXEMPTION OF HOMESTEAD FROM THE COVERAGE OF LAND OR AGRARIAN REFORM.

IV.

THE HONORABLE COURT ALSO ERRED IN NOT DISMISSING THE PETITION FOR CERTIORARI DESPITE THE EVIDENT FACT THAT IT WAS FILED OUT OF TIME.

The threshold issue is whether the RTC had jurisdiction over the petition for declaratory relief, considering the factual circumstances of this case.

Petitioner maintains that the RTC had jurisdiction over the property subject of the action because it was acquired under the Homestead Law. He insists that the lot is exempt from the coverage of the Agrarian Reform Law. Under Section 6, Article XIII of the Constitution, the rights of tenants are subject to prior

rights, including the homestead rights of small settlers.

Petitioner maintains that the ruling in Paris v. Alfeche38 does not apply because he had informed respondents that he and his family wanted to cultivate the property themselves. He stresses that he and his family do not own any property. Pursuant to Section 6 of R.A. No. 6657, the landholding may be retained since it is less than 5 hectares. The dispute between the parties in the RTC involving such

property is within the jurisdiction of the trial court, and not the DAR. He insists that the CA should have dismissed the petition outright for having been filed out of time.

In their comment on the petition, respondents averred that, based on the allegations of the amended complaint, the DARAB, not the RTC, has exclusive jurisdiction over petitioner’s action below. They point out that a tenancy relationship existed between them and petitioner. Moreover, as shown by the

transfer certificates of title which were, in turn, based on the emancipation patents issued in their names, they had already acquired title over the property under P.D. No. 27. Respondents insist that Mejia v.

Gabayan39 had overruled the Court’s rulings in Alita and Patricio.

The Ruling of the Court

The ruling of the CA that the RTC had no jurisdiction over the action filed by petitioner is correct.

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, the character of the relief prayed for, and the law existing at the time of the filing of the complaint or petition.40 Jurisdiction should be determined by considering not only the status on the

relationship between the parties, but also the nature of the issues or questions subject of the controversy. If the issue between the parties is intertwined with an issue the resolution of which is within the

exclusive jurisdiction of the DARAB, it must be resolved by the same body.41 When the actual issues are evident from the records of the case, then jurisdiction over the subject matter need not depend upon

the literal averments in the complaint, but on the law as applied to established facts.42 As the Court held in Ramos v. Stateland Investment Corporation:43

x x x It is axiomatic that the nature of the action and the jurisdiction of the court is to be determined from the material allegations of the complaint as well as the character of the relief prayed for

irrespective of whether or not the plaintiff is entitled to such relief. The jurisdiction of the court or tribunal over the subject matter of the action is determined exclusively by the Constitution and the law. Jurisdiction cannot be conferred by the voluntary act or agreement of the parties; it cannot be acquired

through or waived, enlarged or diminished by their act or omission. Neither is it conferred by the acquiescence of the court. It is neither for the court nor the parties to violate or disregard the rule, this matter being legislative in character. Thus, the jurisdiction over the nature of an action and the subject

matter thereof is not affected by the theories set up by the defendant in an answer or motion to dismiss.44

The powers and functions of the DAR are set forth in Section 50 of R.A. No. 6657. The provision reads:

Section 50. Quasi-Judicial Powers of the DAR. – The DAR is hereby vested with primary jurisdiction to determine and adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all

matters involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of Agriculture (DA) and the Department of Environment and Natural

Resources (DENR).

It shall not be bound by technical rules of procedure and evidence but shall proceed to hear and decide all cases, disputes or controversies in a most expeditious manner, employing all reasonable means to

ascertain the facts of every case in accordance with justice and equity and the merits of the case. Toward this end, it shall adopt a uniform rule of procedure to achieve a just, expeditious and inexpensive

determination of every action or proceeding before it.

Section 3(d) of the same law defines "agrarian dispute" as "any controversy relating to tenurial arrangements, whether leasehold, tenancy, stewardship or, otherwise, over lands devoted to agriculture,

including disputes concerning farmworkers’ associations or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of such tenurial arrangements. It includes any controversy relating to compensation of lands acquired under this Act and other terms and conditions of transfer of ownership from landowners to farmworkers, tenants and other agrarian reform beneficiaries, whether the disputants stand in the proximate relation of farm operator and beneficiary,

landowner and tenant, or lessor and lessee.

For the DARAB to have jurisdiction over a case, there must be a tenancy relationship between the parties. It is essential to establish the following indispensable elements: (1) that the parties are the landowner and the tenant or agricultural lessee; (2) that the subject matter of the relationship is an

agricultural land; (3) that there is consent between the parties to the relationship; (4) that the purpose of the relationship is to bring about agricultural production; (5) that there is personal cultivation on the part

of the tenant or agricultural lessee; and (6) that the harvest is shared between the landowner and the tenant or agricultural lessee.45 In Vda. de Tangub v. Court of Appeals,46 the Court held that the

jurisdiction of the DAR is limited to the following:

a) adjudication of all matters involving implementation of agrarian reform;

b) resolution of agrarian conflicts and land-tenure related problems; and

c) approval or disapproval of the conversion, restructuring or readjustment of agricultural lands into residential, commercial, industrial, and other non-agricultural uses.47

Section 1(f), Rule II of the DARAB likewise provides that the DARAB has primary and exclusive jurisdiction over matters involving the issue, correction and cancellation of Certificates of Land

Ownership Awards (CLOAs) and emancipation patents which are registered with the Land Registration Authority. And as the Court held in Machete v. Court of Appeals,48 the failure of agricultural tenants to pay rentals pursuant to a leasehold contract is an issue which is exclusively cognizable by the DARAB

and beyond the legal competence of the RTC.

Patently, petitioner’s action in the RTC sought to have respondents evicted from the leaseholding, grounded as it was on respondents’ failure to pay rentals since 1998 as provided in the leasehold

agreement. In contrast, respondents claimed that in accordance with P.D. No. 27, R.A. No. 6657, and the DAR Rules and Regulations, they already owned the property. Thus, the dispute between the parties is "agrarian" in nature, within the context of Section 3(d) of R.A. No. 6657. The contentious issue as to

whether petitioner is entitled to the retention of the property involves the application not only of Section 6, Article XIII of the Constitution and Commonwealth Act No. 141, but also of Section 6 of R.A. No. 6657. Under these laws, the original homestead grantees or their direct compulsory heirs who still own

the original homestead at the time of the approval of P.D. No. 27 and R.A. No. 6657 shall retain the same areas as long as they continue to cultivate it. P.D. 27 and R.A. No. 6675 and DAR Memorandum Circular No. 2, Series of 1978, on the other hand, state that tenanted private agricultural lands primarily

devoted to rice and/or corn which have been acquired under the provisions of Commonwealth Act No. 141, as amended, shall also be covered by Operation Land Transfer.

Thus, the issue of what case law applies (whether that in Alita v. Court of Appeals, or Paris v. Alfeche, or Mejia v. Gabayan49) is a matter within the exclusive competence of the DARAB to resolve, based on

R.A. No. 6657 as well as other issuances of the DAR. Also, the issue of whether the emancipation patents and the torrens titles issued to respondents should be cancelled is a matter beyond the jurisdiction of the RTC. It should be resolved by the DARAB. Also to be taken into account is

respondents’ claim that, as late as 1999 and 2000, they continued paying rentals to petitioner despite the fact that emancipation patents and torrens titles over the lot had already been issued in their favor.

Considering that the decision sought to be annulled is a void judgment, the fact that the petition for relief from judgment was belatedly filed is irrelevant. As held in Hilado v. Chavez,50 when the judgment on its face is void ab initio, the limited periods for relief from judgment under Rule 38 are inapplicable. This is so because a void judgment is vulnerable to attack in any way and at anytime, even when no appeal has been taken. When a court has no jurisdiction over the subject matter, any judgment in the

proceedings is a nullity. And considering that a void judgment is in legal effect no judgment by which no rights are divested, from which no rights can be obtained, which neither binds nor bars anyone, and under which all acts performed and all claims flowing out of are void, and considering further that the decision for want of jurisdiction of the court is not a decision in contemplation of law and can never

become executory, it follows that such a void judgment cannot constitute a bar to another case by reason of res judicata.51

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit.

SO ORDERED.

Panganiban, C.J. (Chairperson), Ynares-Santiago, Austria-Martinez, and Chico-Nazario, JJ., concur.

Footnotes

1 Penned by Associate Justice Martin S. Villarama, Jr., with Associate Justices Lucas P. Bersamin and Lucenito N. Tagle, concurring; rollo, pp. 39-58.

2 Rollo, p. 61.

3 Id. at 39-40.

4 CA rollo, p. 53.

5 Id. at 81-84.

6 Id. at 84-85.

7 Id. at 88.

8 Id.

9 Id. at 94-95.

10 Id. at 96.

11 Id. at 99.

12 Id. at 105-106.

13 G.R. No. 78517, February 27, 1989, 170 SCRA 706.

14 Rollo, pp. 107-108.

15 Id. at 111-112.

16 Id. at 113.

17 Id. at 116-119.

18 Id. at 116-117.

19 416 Phil. 473 (2001).

20 CA rollo, pp. 121-126.

21 Section 3. Time for filing petition; contents and verification. – A petition provided for in either of the preceding sections of this Rule must be verified, filed within sixty (60) days after the petitioner learns of

the judgment, final order, or other proceeding to be set aside, and not more than six (6) months after such judgment or final order was entered, or such proceeding was taken, and must be accompanied with

affidavits showing the fraud, accident, mistake, or excusable negligence relied upon, and the facts constituting the petitioner’s good and substantial cause of action or defense, as the case may be.

22 CA rollo, pp. 46-58.

23 Id. at 55.

24 Id. at 57.

25 Id. at 2-45.

26 Id. at 26.

27 Id. at 36-37.

28 Supra note 19, at 484.

29 CA rollo, p. 40.

30 Id. at 140-149.

31 Id. at 143.

32 Supra note 1.

33 Rollo, p. 58.

34 Id. at 55.

35 Id. at 57.

36 Id. at 57-58.

37 CA rollo, p. 183.

38 Supra note 19.

39 G.R. No. 149765, April 12, 2005, 455 SCRA 499.

40 Heirs of Dela Cruz v. Heirs of Cruz, G.R. No. 162890, November 22, 2005, 475 SCRA 743.

41 Monsanto v. Zerna, 423 Phil. 150, 163 (2001).

42 Allied Domecq Phil., Inc. v. Villon, G.R. No. 156264, September 30, 2004, 439 SCRA 667.

43 G.R. No. 161973, November 11, 2005, 474 SCRA 726.

44 Id. at 737-738.

45 Morta, Sr. v. Occidental, G.R. No. 123417, June 10, 1999, 308 SCRA 167.

46 G.R. No. UDK-9864, December 3, 1990, 191 SCRA 885.

47 Supra, at 889.

48 G.R. No. 109093, November 20, 1995, 250 SCRA 176.

49 Supra note 39.

50 G.R. No. 134742, September 22, 2004, 438 SCRA 623, 649.

51 Hilado v. Chavez, supra, at 649, citing Arevalo v. Benedicto, 58 SCRA 186 (1974).Republic of the Philippines

SUPREME COURTManila

FIRST DIVISION

G.R. No. 169091             February 16, 2006

DATU EDUARDO AMPO, Petitioner, vs.

THE HONORABLE COURT OF APPEALS and THE PEOPLE OF THE PHILIPPINES, Respondents.

D E C I S I O N

YNARES-SANTIAGO, J.:

This petition for certiorari seeks to reverse and set aside the Decision1 of the Court of Appeals (CA) dated May 16, 2002 in CA-G.R. CR No. 21738 which affirmed the Decision2 of the Regional Trial Court (RTC) of Butuan City, Branch 1, dated December 10, 1997, in Crim. Case No. 5294 finding

petitioner guilty of violation of Commission on Elections (COMELEC) Resolution No. 2323 (Gun Ban). The CA decision became final and executory on November 16, 2003 and was recorded in the Book of

Entries of Judgment.

The records show that in December 1991, the COMELEC issued Resolution No. 2323, also referred to as the Gun Ban, in connection with the synchronized national and local elections on May 11, 1992. In

the morning of January 20, 1992, a team of Philippine National Police (PNP) officers who were manning the national highway of Santiago, Agusan del Norte flagged down petitioner because a

homemade .45-caliber pistol was seen tucked in his waist.

SPO1 Mario Belliones, one of the police officers manning the checkpoint in Santiago, testified that petitioner failed to present the necessary documents permitting him to carry firearm during the election

period when asked to produce the same.

SPO1 Tex Ariston Maghanoy also testified that during the investigation subsequently conducted, he inquired from petitioner about his authorization to carry the handgun but the latter allegedly explained

that he left the memorandum receipt for the gun at his house. Petitioner also failed to present a permit to carry from the COMELEC. Thus, SPO1 Maghanoy recovered the handgun from petitioner and issued a

temporary receipt for it. Later, on January 27, 1992, SPO1 Maghanoy, together with another police officer, went to petitioner’s house and asked for the memorandum receipt or a COMELEC permit to carry the gun. Petitioner failed to produce any permit, thus, SPO1 Maghanoy issued another receipt

stating therein that the firearm was being "confiscated" to formally terminate the investigation.

Petitioner insisted that the firearm was covered by a memorandum receipt issued on August 20, 1991. He admitted, however, that he did not have a permit from the COMELEC to carry the firearm. He

claimed that in the morning of January 20, 1992, he was on his way to Camp Bancasi to surrender the firearm when he was accosted by the police officers.

On December 10, 1997, the RTC of Butuan City, Branch 1, rendered its decision finding petitioner guilty of the violation, to wit:

WHEREFORE, in view of the foregoing, after considering the evidence offered, this Court finds the accused Eduardo Ampo GUILTY of the crime of violation of COMELEC Resolution No. 2323.

As a consequence, he shall suffer the penalty of imprisonment for one year and will not be qualified to avail of the privilege of the probation law.

He shall be disqualified from holding public office and shall be deprived of the right of suffrage for a period of four (4) years from the date he begins to serve his sentence.

He shall serve his entire sentence at the Provincial Jail in Libertad, Butuan City.

IT IS SO ORDERED.3

Petitioner appealed to the Court of Appeals which affirmed the findings of the trial court in a decision dated May 16, 2002. The decision became final and executory on November 21, 2002 and recorded in

the Book of Entries of Judgments.4

On April 20, 2005,5 petitioner received from the RTC of Butuan City a Notice of the Promulgation of Judgment6 scheduled on May 5, 2005. On June 17, 2005, petitioner filed the instant petition under Rule

65 of the Rules of Court.

Petitioner claims that when the appellate court promulgated its decision on May 16, 2002, his counsel, Atty. Paquito A. Arjona has been dead since May 15, 2001 without his knowledge. He claims that it was

only upon receipt of the notice from the RTC on April 20, 2005 informing him of the promulgation of the decision that he knew of the appellate court’s adverse decision as well as his counsel’s death. Hence, petitioner asserts that such lack of notice regarding the decision, occasioned by the death of his lawyer,

deprived him of due process and a chance to file a motion for reconsideration.

At the same time, petitioner argues that the decision is contrary to established jurisprudence and not supported by the evidence presented. He maintains that the two receipts presented by the prosecution are conflicting. He claims that the first receipt was valid as it was issued at the time the incident happened and by the officer who actually received the firearm. He however insists that the second receipt should not have been given credence considering that it was issued seven days after the incident by a police

officer who did not actually receive the same.

The petition lacks merit.

A petition for relief from judgment is the proper remedy of a party seeking to set aside a judgment rendered against him by a court whenever he was unjustly deprived of a hearing or was prevented from taking an appeal, in either case, because of fraud, accident, mistake or excusable neglect.7 The petition

for relief should be filed within 60 days after the petitioner learns of the judgment or order, or other proceeding to be set aside, and not more than six months after such judgment.8 Both periods must

concur and are not extendible and never interrupted. Strict compliance with these periods stems from the equitable character and nature of the petition for relief. Indeed, relief is allowed only in exceptional

cases as when there is no other available or adequate remedy. A petition for relief is actually the "last chance" given by law to litigants to question a final judgment or order. Failure to avail of such "last

chance" within the grace period fixed by the Rules of Court is fatal.9

In the case at bar, the evidence shows that the instant petition was filed on June 17, 2005, definitely beyond the six-month period from entry of judgment on November 21, 2002.

We are not persuaded by petitioner’s argument that he was not aware that his counsel had died or that an adverse judgment had already been rendered until he received the notice of promulgation from the RTC of Butuan City on April 20, 2005. Time and again we have stated that equity aids the vigilant, not those who slumber on their rights.10 Petitioner should have taken it upon himself to periodically keep in touch

with his counsel, check with the court, and inquire about the status of the case.11 Had petitioner been more prudent, he would have found out sooner about the death of his counsel and would have taken the

necessary steps to prevent his present predicament.

However, petitioner’s lack of zeal to see the termination of his case is quite consistent and apparent. From the time the judgment was rendered on May 16, 2002 until petitioner learned of it on April 20,

2005, a period of almost three years had lapsed without any indication that petitioner kept in touch with his counsel or made inquiries regarding the status of the case.

Litigants who are represented by counsel should not expect that all they need to do is sit back, relax and await the outcome of their cases.12Relief will not be granted to a party who seeks avoidance from the

effects of the judgment when the loss of the remedy at law was due to his own negligence.13 The circumstances of this case plainly show that petitioner only has himself to blame. Neither can he invoke due process. The essence of due process is simply an opportunity to be heard.14 Due process is satisfied

when the parties are afforded a fair and reasonable opportunity to explain their respective sides of the controversy.15 Where a party, such as petitioner, was afforded this opportunity to participate but failed

to do so, he cannot complain of deprivation of due process. If said opportunity is not availed of, it is deemed waived or forfeited without violating the constitutional guarantee.16

Even if we grant the instant petition and allow petitioner to move for the reconsideration of the assailed judgment, we find no error in the decisions rendered by the appellate court and the trial court. As

correctly ruled by the lower court, the testimonies of the police officers in this case are credible and their actions enjoy the presumption of regularity in the performance of official duties, especially where no ill motive or bad faith on their part has been alleged or proven. The evidence sufficiently established that

petitioner was accosted for carrying a firearm during the election period without the required authorization.

On the other hand, petitioner’s contention that he was on his way to surrender the firearm is belied by the fact that when he was flagged down, he did not volunteer to surrender the handgun but instead

requested an audience with the commanding officer at the camp. Also, we find nothing anomalous with the receipts issued by the police officers. The first receipt was a temporary one pending investigation

and served as an acknowledgment on the part of the police officers that they have in their possession the firearm of the petitioner. The second receipt, on the other hand, was issued after due investigation and was a formal notice to petitioner that his firearm was confiscated for failure to produce the necessary

documents purportedly authorizing him to carry the same during the election period.

More importantly, COMELEC Resolution No. 2323 is a special law and a violation of which is in the nature of a mala prohibita crime. As such, regardless of petitioner’s intent, mere carrying of the gun

without the necessary permit is already a violation of the COMELEC resolution. It is hornbook doctrine that in mala prohibita crimes, the only inquiry is whether the law has been violated.17 When the act is

illegal, the intent of the offender is immaterial. We held in United States v. Go Chico18 that:

x x x [I]t is not necessary that the appellant should have acted with criminal intent. In many crimes, made such by statutory enactment, the intention of the person who commits the crime is entirely

immaterial. This is necessarily so. If it were not, the statute as a deterrent influence would be substantially worthless. It would be impossible of execution. In many cases, the act complained of is

itself that which produces the pernicious effect the statute seeks to avoid. In those cases the pernicious effect is produced with precisely the same force and result whether the intention of the person

performing the act is good or bad.

In the same vein, petitioner would have us delve into the factual issues of the case. Factual findings of the Court of Appeals are conclusive on the parties and not reviewable by this Court – and they carry even more weight when the Court of Appeals affirms the factual findings of the trial court, and in the

absence of any showing that the findings complained of are totally devoid of support in the evidence on record, or that they are so glaringly erroneous as to constitute serious abuse of discretion, such findings must stand.19 This Court is not duty-bound to analyze and weigh again the evidence considered in the

proceedings below. Petitioner has not given us ample reasons to depart from this general rule.20

WHEREFORE, the foregoing premises considered, the petition is hereby DISMISSED.

SO ORDERED.

CONSUELO YNARES-SANTIAGOAssociate Justice

WE CONCUR:

ARTEMIO V. PANGANIBANChief JusticeChairperson

MA. ALICIA AUSTRIA-MARTINEZAssociate Justice

ROMEO J. CALLEJO, SR.Asscociate Justice

MINITA V. CHICO-NAZARIO

Associate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of

the Court’s Division.

ARTEMIO V. PANGANIBANChief Justice

Footnotes

1 Rollo, pp. 16-33. Penned by Associate Justice Teodoro P. Regino, as concurred in by Associate Justices Eugenio S. Labitoria and Juan Q. Enriquez, Jr.

2 Id. at 37-52. Penned by Judge Marissa Macaraig-Guillen.

3 Id. at 51-52.

4 Id. at 35.

5 Id. at 5.

6 Id. at 34.

7 RULES OF COURT, Rule 38, Sec. 1.

8 Id., id., Sec. 3.

9 Quelnan v. VHF Philippines, G.R. No. 138500, September 16, 2005.

10 Philippine Rabbit Bus Lines, Inc. v. Arciaga, G.R. No. L-29701, March 16, 1987, 148 SCRA 433, 438.

11 Macondray & Company, Inc. v. Provident Insurance Corporation, G.R. No. 154305, December 9, 2004, 445 SCRA 644, 654.

12 Id.

13 Cerezo v. Tuazon, G.R. No. 141538, March 23, 2004, 426 SCRA 167, 183.

14 Neeco II v. National Labor Relations Commission, G.R. No. 157603, June 23, 2005.

15 Estrada v. People, G.R. No. 162371, August 25, 2005.

16 Villaluz v. Ligon, G.R. No. 143721, August 31, 2005.

17 Dunlao, Sr. v. Court of Appeals, 329 Phil. 613, 619 (1996); Dela Torre v. Commission on Elections, 327 Phil. 1144, 1151 (1996).

18 14 Phil. 128, 131 (1909).

19 Philippine National Bank v. Pike, G.R. No. 157845, September 20, 2005.

20 Umpoc v. Mercado, G.R. No. 158166, January 21, 2005, 449 SCRA 220, 235.

THIRD DIVISION

[G.R. No. 147958.  March 31, 2005]

AIDA LUGAYAN, RONA LUGAYAN and ARTURO LUGAYAN, petitioners, vs. SPOUSES CORAZON and ANTONIO TIZON, respondents.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

For resolution is the petition for review on certiorari assailing the Decision[1] of the Court of Appeals in CA-G.R. SP No. 61474, entitled “AIDA LUGAYAN, RONA LUGAYAN and ARTURO LUGAYAN versus SPOUSES ANTONIO and CORAZON TIZON.”

The facts are:

The instant case stemmed from Civil Case No. 146786-CV for sum of money filed by Travel 2000 International against petitioner Aida Lugayan with the Metropolitan Trial Court (MeTC), Branch 19, Manila.

For her failure to file an answer, Aida was declared in default and Travel 2000 International was allowed to present its evidence ex parte.

On March 8, 1995, the MeTC rendered its Decision holding Aida liable to Travel 2000 International in the amount of US$8,430.00.  Upon finality of this Decision, a writ of execution was issued.

The Sheriff then levied upon Aida’s house and lot located at 17 Yakal St., Manuela IV, Las Piñas City.  During the auction sale, spouses Tizon, herein respondents, were declared the highest bidders and eventually became the registered owners of the property.

Thereupon, Aida filed with the Regional Trial Court (RTC), Branch 15, Manila a complaint for annulment of the MeTC Decision in Civil Case No. 146786-CV for sum of money.  This suit was docketed as Civil Case No. 96-79181.

Meanwhile, Aida failed to redeem her house and lot within one year.  This prompted spouses Tizon to file a complaint for illegal detainer with the MeTC, Branch 79, Las Piñas City, docketed as Civil Case No. 5081.   Impleaded as defendants were the occupants of the premises, Rona and Arturo Lugayan, Aida’s siblings, and all persons claiming rights under them.

During the course of the proceedings, Aida Lugayan and Diosdado Lugayan, her other sibling, presented themselves as “volunteer defendants.”  They alleged that they are the real parties in interest; that Aida owns the property; that according to Diosdado, it was constituted as a family home in accordance with the Family Code; that spouses Tizon have no cause of action against them due to the pendency of Civil Case No. 96-79181 for annulment of judgment in Civil Case No. 146786-CV for sum of money pending in the RTC, Branch 19 of Manila; and that litis pendentia and forum shopping barred the institution of Civil Case No. 5081.

On October 28, 1998, the MeTC of Las Piñas, Branch 79, rendered judgment in Civil Case No. 5081 for illegal detainer in favor of spouses Tizon, thus:

“WHEREFORE, judgment is hereby rendered ordering the defendants including the volunteer defendants and all persons claiming rights under them to vacate the premises subject of the complaint and to surrender possession thereof to the plaintiffs; Ordering the defendants to pay plaintiffs jointly and severally the sum ofP3,000.00 a month as reasonable compensation for the use and occupation of the premises in question from February 8, 1997 until finally they vacate the premises, plus the sum of P10,000.00 as reasonable attorney’s fees, plus costs of suit.

SO ORDERED.”[2]

On appeal, the RTC, Branch 253 of Las Piñas City affirmed in toto the MeTC Decision.

Dissatisfied, the Lugayans filed with the Court of Appeals a petition for review, docketed as CA-G.R. SP No. 61474.

On May 9, 2001, the Appellate Court denied the petition for lack of merit.[3]

Hence, the instant petition alleging that the Court of Appeals erred in not dismissing the complaint of unlawful detainer on the ground of res judicata and forum shopping.

We sustain the challenged Decision of the Court of Appeals.

The elements of res judicata, also known as “bar by prior judgment,” are: (1) the former judgment must be final; (b) the court which rendered it had jurisdiction over the subject matter and the parties; (c) it must be a judgment on the merits; and (d) there must be, between the first and second actions, identity of parties, subject matter, and causes of action.[4]

Here, the fourth element is not present.

First, there is no identity of parties.  In Civil Case No. 146786 for sum of money, the parties are Travel 2000 International, as plaintiff, and Aida Lugayan, as defendant.  In Civil Case No. 5081, for illegal detainer, the parties are spouses Antonio and Corazon Tizon, as plaintiffs, and Rona Lugayan and Arturo Lugayan, and all persons claiming rights under them, as defendants.

Second, the subject matter in Civil Case No. 146786 is non-payment of debt, while in Civil Case No. 5081, it is unlawful possession of the property.

Third, there is no identity in the causes of action.  Civil Case No. 146786 is for sum of money, while Civil Case No. 5081 is for illegal detainer.

Accordingly, we find that the Court of Appeals committed no reversible error of law in holding that since there is no identity of parties, subject matter and causes of action, it follows that the judgment in Civil Case No. 146786 for sum of money would not amount to res judicata to Civil Case No. 5081 for illegal detainer.

On the issue of forum shopping, suffice it to say that it may only exist where the elements of litis pendentia are present or where a final judgment in one case will amount to res judicata in the other,[5] which are not obtaining here.

WHEREFORE, the petition is DENIED.  The Decision of the Court of Appeals in CA-G.R. SP No. 61474 is AFFIRMED.  Costs against petitioners.

SO ORDERED.

Panganiban, (Chairman), Corona, Carpio-Morales, and Garcia, JJ., concur.

[1] Penned by Justice Buenaventura J. Guerrero and concurred in by Justices Eriberto U. Rosario, Jr., and Alicia L. Santos (all retired).

[2] Id. at 36.[3] Id. at 39.[4] Section  1(f),   Rule  16  of  the 1997  Rules  of Civil Procedure, as amended; Tolentino v. Natanauan , G.R. No.

135441, November 20, 2003, 416 SCRA 273, citing Sta. Lucia Realty and Development Corp, v. Cabrigas, 358 SCRA 715 (2001).

[5] Development Bank of   the Philippines   v. Pingol Land Transport System Company, Inc ., G.R. No. 145908 , January 22, 2004, 420 SCRA 652, 658 citing Spouses Hanopol v. Shoemart, Inc. 390 SCRA 439 (2002).

Republic of the PhilippinesSUPREME COURT

Manila

THIRD DIVISION

G.R. No. 163663             June 30, 2006

GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMMITTEE and the METROPOLITAN MANILA DEVELOPMENT AUTHORITY, Petitioners, vs.JANCOM ENVIRONMENTAL CORPORATION and JANCOM INTERNATIONAL DEVELOPMENT PROJECTS PTY. LIMITED OF AUSTRALIA, Respondents.

D E C I S I O N

CARPIO MORALES, J.:

The present petition for review on certiorari challenges the Decision1 dated December 19, 2003 and Resolution2 dated May 11, 2004 of the Court of Appeals (CA)3 in CA-G.R. SP No. 78752 which denied the petition for certiorari filed by herein petitioners Greater Metropolitan Manila Solid Waste

Management Committee (GMMSWMC) and the Metropolitan Manila Development Authority (MMDA) and their Motion for Reconsideration, respectively.

In 1994, Presidential Memorandum Order No. 202 was issued by then President Fidel V. Ramos creating an Executive Committee to oversee and develop waste-to-energy projects for the waste disposal sites in San Mateo, Rizal and Carmona, Cavite under the Build-Operate-Transfer (BOT) scheme.

Respondent Jancom International Development Projects Pty. Limited of Australia (Jancom International) was one of the bidders for the San Mateo Waste Disposal Site. It subsequently entered into a partnership with Asea Brown Boveri under the firm name JANCOM Environmental Corporation (JANCOM), its co-respondent.

On February 12, 1997, the above-said Executive Committee approved the recommendation of the Pre-qualification, Bids and Awards Committee to declare JANCOM as the sole complying bidder for the San Mateo Waste Disposal Site.

On December 19, 1997, a Contract for the BOT Implementation of the Solid Waste Management Project for the San Mateo, Rizal Waste Disposal Site4 (the contract) was entered into by the Republic of the Philippines, represented by the Presidential Task Force on Solid Waste Management through then Department of Environment and Natural Resources Secretary Victor Ramos, then Cabinet Office for Regional Development-National Capital Region Chairman Dionisio dela Serna, and then MMDA Chairman Prospero Oreta on one hand, and JANCOM represented by its Chief Executive Officer Jorge Mora Aisa and its Chairman Jay Alparslan, on the other.

On March 5, 1998, the contract was submitted for approval to President Ramos who subsequently endorsed it to then incoming President Joseph E. Estrada.

Owing to the clamor of the residents of Rizal, the Estrada administration ordered the closure of the San Mateo landfill. Petitioner GMMSWMC thereupon adopted a Resolution not to pursue the contract with JANCOM, citing as reasons therefor the passage of Republic Act 8749, otherwise known as the Clean Air Act of 1999, the non-availability of the San Mateo site, and costly tipping fees.5

The Board of Directors of Jancom International thereafter adopted on January 4, 2000 a Resolution6 authorizing Atty. Manuel Molina to act as legal counsel for respondents and "determine and file such legal action as deemed necessary before the Philippine courts in any manner he may deem appropriate" against petitioners.

The Board of Directors of JANCOM also adopted a Resolution7 on February 7, 2000 granting Atty. Molina similar authorization to file legal action as may be necessary to protect its interest with respect to the contract.

On March 14, 2000, respondents filed a petition for certiorari8 with the Regional Trial Court (RTC) of Pasig City where it was docketed as Special Civil Action No. 1955, to declare the GMMSWMC Resolution and the acts of the MMDA calling for bids for and authorizing the forging of a new contract for the Metro Manila waste management as illegal, unconstitutional and void and to enjoin petitioners from implementing the Resolution and making another award in lieu thereof.

By Decision9 of May 29, 2000, Branch 68 of the Pasig City RTC found in favor of respondents.10

Petitioners thereupon assailed the RTC Decision via petition for certiorari11 with prayer for a temporary restraining order with the CA, docketed as CA-G.R. SP No. 59021.

By Decision12 of November 13, 2000, the CA denied the petition for lack of merit and affirmed in toto the May 29, 2000 RTC Decision. Petitioners’ Motion for Reconsideration was denied, prompting them to file a petition for review before this Court, docketed as G.R. No. 147465.

By Decision13 of January 30, 2002 and Resolution14 of April 10, 2002, this Court affirmed the November 13, 2001 CA Decision and declared the contract valid and perfected, albeit ineffective and unimplementable pending approval by the President.

JANCOM and the MMDA later purportedly entered into negotiations to modify certain provisions of the contract which were embodied in adraft Amended Agreement15 dated June 2002. The draft Amended Agreement bore no signature of the parties.

Respondents, through Atty. Molina, subsequently filed before Branch 68 of the Pasig City RTC an Omnibus Motion16 dated July 29, 2002 praying that: (1) an alias writ of execution be issued prohibiting and enjoining petitioners and their representatives from calling for, accepting, evaluating, approving, awarding, negotiating or implementing all bids, awards and contracts involving other Metro Manila waste management projects intended to be pursued or which are already being pursued; (2) the MMDA, through its Chairman Bayani F. Fernando, be directed to immediately forward and recommend the approval of the Amended Agreement to President Gloria Macapagal Arroyo; (3) Chairman Fernando be ordered to personally appear before the court and explain his acts and public pronouncements which are in direct violation and gross defiance of the final and executory May 29, 2000 RTC Decision; (4) the Executive Secretary and the Cabinet Secretaries of the departments-members of the National Solid Waste Management Commission be directed "to submit the contract within 30 days from notice to the President for signature and approval and if the latter chooses not to sign or approve the contract, the Executive Secretary be made to show cause therefor;" and (5) petitioners be directed to comply with and submit their written compliance with their obligations specifically directed under the provisions of Article 18, paragraphs 18.1, 18.1.1 (a), (b), (c) and (d) of the contract within 30 days from notice.17

To the Omnibus Motion petitioners filed their Opposition18 which merited JANCOM’s Reply19 filed on August 19, 2002.

On August 21, 2002, Atty. Simeon M. Magdamit, on behalf of Jancom International, filed before the RTC an Entry of Special Appearance and Manifestation with Motion to Reject the Pending Omnibus Motion20 alleging that: (1) the Omnibus Motion was never approved by Jancom International; (2) the Omnibus Motion was initiated by lawyers whose services had already been terminated, hence, were unauthorized to represent it; and (3) the agreed judicial venue for dispute resolution relative to the implementation of the contract is the International Court of Arbitration in the United Kingdom pursuant to Article 16.121 of said contract.

In the meantime, on November 3, 2002, the MMDA forwarded the contract to the Office of the President for appropriate action,22 together with MMDA Resolution No. 02-1823 dated June 26, 2002, "Recommending to her Excellency the President of the Republic of the Philippines to Disapprove the Contract Entered Into by the Executive Committee of the Presidential Task Force on Waste Management with Jancom Environmental Corporation and for Other Purposes."

By Order24 of November 18, 2002, the RTC noted the above-stated Entry of Special Appearance of Atty. Magdamit for Jancom International and denied the Motion to Reject Pending Omnibus Motion for lack of merit. Jancom International filed on December 9, 2002 a Motion for Reconsideration25 which was denied for lack of merit by Order26 of January 8, 2003.

Petitioners and respondents then filed their Memoranda27 on May 23, 2003 and May 26, 2003,

respectively.

By Order28 of June 11, 2003, the RTC granted respondents’ Omnibus Motion in part. The dispositive portion of the Order reads, quotedverbatim:

WHEREFORE, in view of the foregoing, let an Alias Writ of Execution immediately issue and the Clerk of Court and Ex-Oficio Sheriff or any o[f] her Deputies is directed to implement the same within sixty (60) days from receipt thereof.

Thus, any and all such bids or contracts entered into by respondent MMDA with third parties covering the waste disposal and management within the Metro Manila after August 14, 2000 are hereby declared NULL and VOID. Respondents are henceforth enjoined and prohibited, with a stern warning, from entering into any such contract with any third party whether directly or indirectly, in violation of the contractual rights of petitioner JANCOM under the BOT Contract Award, consistent with the Supreme Court’s Decision of January 30, 2002.

Respondent MMDA is hereby directed to SUBMIT the Amended Agreement concluded by petitioners with the previous MMDA officials, or in its discretion if it finds [it] more advantageous to the government, to require petitioners to make adjustments in the Contract in accordance with existing environmental laws and other relevant concerns, and thereafter forward the Amended Agreement for signature and approval by the President of the Philippines. The concerned respondents are hereby further directed to comply fully and in good faith with its institutional obligations or undertakings as provided in Article 18 of the BOT Contract.

Let a copy of this Order be furnished the Office of the Clerk of Court and the Commission on Audit for its information and guidance.

SO ORDERED.29 (Emphasis in the original)

On June 23, 2003 the RTC issued an Alias Writ of Execution30 reading:

WHEREAS, on May 29, 2000, a Decision was rendered by this Court in the above-entitled case, the pertinent portions of which is [sic] hereunder quoted as follows:

WHEREFORE, in view of the foregoing, the Court hereby renders judgment in favor of petitioners JANCOM ENVIRONMENTAL CORP and JANCOM INTERNATIONAL DEVELOPMENT PROJECTS PTY., LIMITED OF AUSTRALIAS [sic], and against respondents GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMM., and HON. ROBERTO N. AVENTAJADO, in his capacity as Chairman of the said Committee, METRO MANILA DEVELOPMENT AUTHORITY and HON. JEJOMAR C. BINAY, in his capacity as Chairman of said Authority, declaring the Resolution of respondent Greater Metropolitan Manila Solid Waste Management Committee disregarding petitioners’ BOT Award Contract and calling for bids for and authorizing a new contract for the Metro Manila waste management ILLEGAL an[d] VOID.

Moreover, respondents and their agents are hereby PROHIBITED and ENJOINED from implementing the aforesaid Resolution and disregarding petitioners’ BOT Award Contract and from making another award in its place.

Let it be emphasized that this Court is not preventing or stopping the government from implementing infrastructure projects as it is aware of the proscription under PD 1818. On the contrary, the Court is paving the way for the necessary and modern solution to the perennial garbage problem that has been the major headache of the government and in the process would serve to attract more investors in the

country.

SO ORDERED.

WHEREAS, on August 7, 2000, petitioners through counsel filed a "Motion for Execution" which the Court GRANTED in its Order dated August 14, 2000;

WHEREAS, as a consequence thereof, a Writ of Execution was issued on August 14, 2000 and was duly served upon respondents as per Sheriff’s Return dated August 27, 2000;

WHEREAS, ON July 29, 2002, petitioners through counsel filed an "Omnibus Motion," praying, among others, for the issuance of an Alias Writ of Execution which the Court GRANTED in its Order dated June 11, 2003, the dispositive portion of which reads as follows:

WHEREFORE, in view of the foregoing, let an Alias Writ of Execution immediately issue and the Clerk of Court and Ex-Oficio Sheriff or any of her Deputies is directed to implement the same within sixty (60) days from receipt thereof.

Thus, any and all such bids or contracts entered into by respondent MMDA [with] third parties covering the waste disposal and management within the Metro Manila after August 14, 2000 are hereby declared NULL and VOID. Respondents are henceforth enjoined and prohibited, with a stern warning, from entering into any such contract with any third party whether directly or indirectly, in violation of the contractual rights of petitioner Jancom under the BOT Contract Award, consistent with the Supreme Court’s Decision of January 30, 2002.

Respondent MMDA is hereby directed to SUBMIT the Amended Agreement concluded by petitioners with the previous MMDA officials, or in its discretion if it finds [it] more advantageous to the government, to require petitioners to make adjustments in the Contract in accordance with existing environmental laws and other relevant concerns, and thereafter forward the Amended Agreement for signature and approval by the President of the Philippines. The concerned respondents are hereby further directed to comply fully and in good faith with its institutional obligations or undertakings as provided in Article 18 of the BOT Contract.

Let a copy of this Order be furnished the Office of the Clerk of Court and the Commission on Audit for its information and guidance.

SO ORDERED.

x x x x (Emphasis in the original)

By letter31 of August 15, 2003, Chairman Fernando advised Sheriff Alejandro Q. Loquinario of the Office of the Clerk of Court and Ex-Oficio Sheriff, Pasig City RTC that:

1. MMDA has not entered into a new contract for solid waste management in lieu of JANCOM’s Contract.

2. JANCOM’s Contract has been referred to the Office of the President for appropriate action.

3. Without the President’s approval, JANCOM’s Contract cannot be implemented.32

Petitioners later challenged the RTC June 11, 2003 Order via petition for certiorari33 with prayer for the

issuance of a temporary restraining order and/or writ of preliminary injunction before the CA. They subsequently filed an Amended Petition34 on September 26, 2003.

To the Amended Petition JANCOM filed on October 8, 2003 its Comment35 after which petitioners filed their Reply36 on November 24, 2003.

By the challenged Decision of December 19, 2003, the CA denied the petition and affirmed the June 11, 2003 RTC Order in this wise:

The Supreme Court ruled that the Jancom contract has the force of law and the parties must abide in good faith by their respective contractual commitments. It is precisely this pronouncement that the alias writ of execution issued by respondent judge seeks to enforce. x x x

x x x x

The fact that the Jancom contract has been declared unimplementable without the President’s signature, would not excuse petitioners’ failure to comply with their undertakings under Article 18 of the contract. x x x

x x x x

Petitioners complain that respondent judge focused only on requiring them to perform their supposed obligations under Article 18 of the contract when private respondents are also required thereunder to post a Performance Security acceptable to the Republic in the amount allowed in the BOT Law. Petitioners’ complaint is not justified. x x x

x x x x

It cannot x x x be said that respondent judge had been unfair or one-sided in directing only petitioners to fulfill their own obligations under Article 18 of the Jancom contract. Compliance with private respondents’ obligations under the contract had not yet become due.

x x x x

There is no debate that the trial court’s Decision has attained finality. Once a judgment becomes final and executory, the prevailing party can have it executed as a matter of right and the granting of execution becomes a mandatory or ministerial duty of the court. After a judgment has become final and executory, vested rights are acquired by the winning party. Just as the losing party has the right to file an appeal within the prescribed period, so also the winning party has the correlative right to enjoy the finality of the resolution of the case.

It is true that the ministerial duty of the court to order the execution of a final and executory judgment admits of exceptions as (a) where it becomes imperative in the higher interest of justice to direct the suspension of its execution; or (b) whenever it is necessary to accomplish the aims of justice; or (c) when certain facts and circumstances transpired after the judgment became final which could render the execution of the judgment unjust. Petitioners have not shown that any of these exceptions exists to prevent the mandatory execution of the trial court’sDecision.37 (Italics in the original)

Petitioners’ Motion for Reconsideration38 having been denied by the CA by Resolution of May 11, 2004, the present petition for review39was filed on July 12, 2004 positing that:

THE COURT OF APPEALS GRAVELY ERRED IN UPHOLDING THE LOWER COURT AND IN DISREGARDING THE FOLLOWING PROPOSITIONS:

I

THE SUBJECT CONTRACT IS INEFFECTIVE AND UNIMPLEMENTABLE UNTIL AND UNLESS IT IS APPROVED BY THE PRESIDENT.

II

THE SUBJECT CONTRACT ONLY COVERS THE DISPOSITION OF 3,000 TONS OF SOLID WASTE A DAY.

III

THE ALLEGED AMENDED AGREEMENT IS ONLY A DRAFT OR PROPOSAL SUBMITTED BY RESPONDENTS.

IV

RESPONDENTS MUST ALSO BE MADE TO COMPLY WITH THEIR CONTRACTUAL COMMITMENTS.40 (Underscoring supplied)

JANCOM filed on September 20, 2004 its Comment41 on the petition to which petitioners filed their Reply42 on January 28, 2005.

On May 4, 2005, Jancom International filed its Comment,43 reiterating its position that it did not authorize the filing before the RTC by Atty. Molina of the July 29, 2002 Omnibus Motion that impleaded it as party-movant.

On July 7, 2005, petitioners filed their Reply44 to Jancom International’s Comment.

Petitioners argue that since the contract remains unsigned by the President, it cannot yet be executed. Ergo, they conclude, the proceedings which resulted in the issuance of an alias writ of execution "ran afoul of the [January 30, 2002] decision of [the Supreme] Court in G.R. No. 147465."45

Petitioners go on to argue that since the contract covers only 3,000 tons of garbage per day while Metro Manila generates at least 6,000 tons of solid waste a day, MMDA may properly bid out the other 3,000 tons of solid waste to other interested groups or entities.

Petitioners moreover argue that the alleged Amended Agreement concluded supposedly between JANCOM and former MMDA Chairman Benjamin Abalos is a mere scrap of paper, a mere draft or proposal submitted by JANCOM to the MMDA, no agreement on which was reached by the parties; and at all events, express authority ought to have first been accorded the MMDA to conclude such an amended agreement with JANCOM, the original contract having been concluded between the Republic of the Philippines and JANCOM.

Finally, petitioners argue that respondents should also be required to perform their commitments pursuant to Article 1846 of the contract.

The petition is impressed with merit in light of the following considerations.

Section 1, Rule 39 of the Rules of Court provides:

SECTION 1. Execution upon judgments or final orders. – Execution shall issue as a matter of right, on motion, upon a judgment or order that disposes of the action or proceeding upon the expiration of the period to appeal therefrom if no appeal has been duly perfected.

If the appeal has been duly perfected and finally resolved, the execution may forthwith be applied for in the court of origin, on motion of the judgment obligee, submitting therewith certified true copies of the judgment or judgments or final order or orders sought to be enforced and of the entry thereof, with notice to the adverse party.

The appellate court may, on motion in the same case, when the interest of justice so requires, direct the court of origin to issue the writ of execution.

Once a judgment becomes final, it is basic that the prevailing party is entitled as a matter of right to a writ of execution the issuance of which is the trial court’s ministerial duty, compellable by mandamus.47

There are instances, however, when an error may be committed in the course of execution proceedings prejudicial to the rights of a party. These instances call for correction by a superior court, as where:

1) the writ of execution varies the judgment;

2) there has been a change in the situation of the parties making execution inequitable or unjust;

3) execution is sought to be enforced against property exempt from execution;

4) it appears that the controversy has never been submitted to the judgment of the court;

5) the terms of the judgment are not clear enough and there remains room for interpretation thereof; or

6) it appears that the writ of execution has been improvidently issued, or that it is defective in substance, or is issued against the wrong party, or that the judgment debt has been paid or otherwise satisfied, or the writ was issued without authority.48 (Emphasis and Underscoring supplied)

That a writ of execution must conform to the judgment which is to be executed, substantially to every essential particular thereof,49 it is settled. It may not thus vary the terms of the judgment it seeks to enforce,50 nor go beyond its terms. Where the execution is not in harmony with the judgment which gives it life and exceeds it, it has no validity.51

This Court’s January 30, 2002 Decision in G.R. No. 147465 held:

We, therefore, hold that the Court of Appeals did not err when it declared the existence of a valid and perfected contract between the Republic of the Philippines and JANCOM. There being a perfected contract, MMDA cannot revoke or renounce the same without the consent of the other. From the moment of perfection, the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good

faith, usage, and law (Article 1315, Civil Code). The contract has the force of law between the parties and they are expected to abide in good faith by their respective contractual commitments, not weasel out of them. Just as nobody can be forced to enter into a contract, in the same manner, once a contract is entered into, no party can renounce it unilaterally or without the consent of the other. It is a general principle of law that no one may be permitted to change his mind or disavow and go back upon his own acts, or to proceed contrary thereto, to the prejudice of the other party. Nonetheless, it has to be repeated that although the contract is a perfected one, it is still ineffective or unimplementable until and unless it is approved by the President . 52  (Emphasis and Underscoring supplied)

This Court’s April 10, 2002 Resolution also in G.R. No. 147465 moreover held:

x x x The only question before the Court is whether or not there is a valid and perfected contract between the parties. As to the necessity, expediency, and wisdom of the contract, these are outside the realm of judicial adjudication. These considerations are primarily and exclusively a matter for the President to decide. While the Court recognizes that the garbage problem is a matter of grave public concern, it can only declare that the contract in question is a valid and perfected one between the parties, but the same is still ineffective or unimplementable until and unless it is approved by the President, the contract itself providing that such approval by the President is necessary for its effectivity.53 (Emphasis and Underscoring supplied)

Article 19 of the contract provides:

Article 19. Effectivity. – This Contract shall become effective upon approval by the President of the Republic of [the] Philippines pursuant to existing Laws subject to condition precedent in Article 18. This Contract shall remain in full force and effect for twenty five (25) years subject to renewal for another twenty five (25) years from the date of Effectivity. Such renewal will be subject to mutual agreement of the parties and approval by the [P]resident of the Republic of [the] Philippines. (Emphasis and underscoring supplied)

In issuing the alias writ of execution, the trial court in effect ordered the enforcement of the contract despite this Court’s unequivocal pronouncement that albeit valid and perfected, the contract shall become effective only upon approval by the President.

Indubitably, the alias writ of execution varied the tenor of this Court’s judgment, went against essential portions and exceeded the terms thereof.

x x x a lower court is without supervisory jurisdiction to interpret or to reverse the judgment of the higher court x x x. A judge of a lower court cannot enforce different decrees than those rendered by the superior court. x x x

The inferior court is bound by the decree as the law of the case, and must carry it into execution according to the mandate. They cannot vary it, or examine it for any other purpose than execution, or give any other or further relief, or review it upon any matter decided on appeal for error apparent, or intermeddle with it, further than to settle so much as has been remanded. x x x54

The execution directed by the trial court being out of harmony with the judgment, legal implications cannot save it from being found to be fatally defective.55

Notably, while the trial court ratiocinated that it issued on June 23, 2003 the alias writ "to set into motion the legal mechanism for Presidential approval and signature,"56 it failed to take due consideration of the fact that during the pendency of the Omnibus Motion, the contract had earlier been forwarded for appropriate action on November 3, 2002 by Chairman Fernando to the Office of the President, with

recommendation for its disapproval, which fact the trial court had been duly informed of through pleadings and open court manifestations.57

Additionally, it bears noting that the June 11, 2003 Order of the trial court is likewise indisputably defective in substance for having directed the submission of the draft Amended Agreement to the President.

The appellate court, in affirming the June 11, 2003 Order of the trial court, overlooked the fact that the Amended Agreement was unsignedby the parties and it instead speculated and rationalized that the submission thereof to the President would at all events solve the mounting garbage problem in Metro Manila:

We find that the submission of the Amended Agreement to the President will break the impasse now existing between the parties which has effectively halted the government’s efforts to address Metro Manila’s mounting garbage problem. x x x

As long as petitioners refuse to deal with private respondents, the Metro Manila garbage problem will only continue to worsen. x x x

That the Amended Agreement could have well been negotiated, if not concluded between private respondents and the former MMDA administration, is not far-fetched. Petitioners do not dispute that the President had referred the Jancom contract to then MMDA Chairman Benjamin Abalos for recommendation. Petitioners also do not dispute that private respondents negotiated with the MMDA for the amendment of the contract.

Besides, the Amended Agreement does not veer away from the original Jancom contract. x x x58 lawphil.net

The Amended Agreement was, as petitioners correctly allege, merely a draft document containing the proposals of JANCOM, subject to the approval of the MMDA. As earlier stated, it was not signed by the parties.59

The original contract itself provides in Article 17.6 that it "may not be amended except by a written [c]ontract signed by the parties."60

It is elementary that, being consensual, a contract is perfected by mere consent.61 The essence of consent is the conformity of the parties to the terms of the contract, the acceptance by one of the offer made by the other;62 it is the concurrence of the minds of the parties on the object and the cause which shall constitute the contract.63 Where there is merely an offer by one party without acceptance by the other, there is no consent and the contract does not come into existence.64

As distinguished from the original contract in which this Court held in G.R. No. 147465:

x x x the signing and execution of the contract by the parties clearly show that, as between the parties, there was concurrence of offer and acceptance with respect to the material details of the contract, thereby giving rise to the perfection of the contract. The execution and signing of the contract is not disputed by the parties x x x,65

the parties did not, with respect to the Amended Agreement, get past the negotiation stage. No meeting of minds was established. While there was an initial offer made, there was no acceptance.

Even JANCOM President Alfonso G. Tuzon conceded, by letter66 of June 17, 2002 to Chairman

Fernando, that the Amended Agreement was a mere proposal:

Apropos to all these, we are seeking an urgent EXECUTIVE SESSION on your best time and venue. We can thresh up major points to establish a common perspective based on data and merit.

We are optimistic you shall then consider with confidence the proposed Amended Contract which incorporates the adjustments we committed to as stated and earlier submitted to your Office during the incumbency of your predecessor, for evaluation and appropriate action by NEDA in compliance with the BOT Law and Article 18.1.1 of our contract.67

While respondents aver that an acceptance was made, they have not proffered any proof. While indeed the MMDA, by a letter68 issued by then MMDA General Manager Jaime Paz, requested then Secretary of Justice Hernando B. Perez for his legal opinion on the draft Amended Agreement, nowhere in the letter is there any statement indicating that the MMDA, or the Republic of the Philippines for that matter, had approved respondents’ proposals embodied in the said draft agreement.

The pertinent portions of the letter read:

Attention: HON. HERNANDO B. PEREZ

Secretary

Subject: Request for Opinion Regarding the Compromise Offer of Jancom Environmental Corporation for the Municipal Solid Waste Management of Metro Manila

Dear Secretary Perez:

This is to respectfully request for an opinion from your Honorable Office regarding the Compromise Proposal offered by JANCOM Environmental Corporation ("JANCOM") in relation to its Contract for the BOT Implementation of the Waste Management Project for the San Mateo, Rizal Waste Disposal Site dated 19 December 1997 (hereinafter referred to as the BOT Contract for brevity) with the Republic of the Philippines.

x x x x

x x x this representation is requesting your Honorable Office to render a legal opinion on the following:

Does the offer of JANCOM to temporarily set aside the waste-to-energy plant and implement only the other two major components of the BOT Contract amount to a novation of the BOT Contract, and therefore necessitating a re-bidding? If the same does not amount to a novation, by what authority may Jancom set aside temporarily a major component of the BOT Contract?

x x x x69

Only an absolute or unqualified acceptance of a definite offer manifests the consent necessary to perfect a contract.70 If at all, the MMDA letter only shows that the parties had not gone beyond the preparation stage, which is the period from the start of the negotiations until the moment just before the agreement of the parties.71 Obviously, other material considerations still remained before the Amended Agreement could be perfected. At any time prior to the perfection of a contract, unaccepted offers and proposals remain as such and cannot be considered as binding commitments.72

Respecting petitioners’ argument that respondents should be directed to comply with their commitments under Article 18 of the contract, this Court is not convinced.

Article 18.2.1 of the contract provides:

18.2.1 The BOT COMPANY hereby undertakes to provide the following within 2 months from execution of this Contract as an effective document:

a) sufficient proof of the actual equity contributions from the proposed shareholders of the BOT COMPANY in a total amount not less than PHP 500,000,000 in accordance with the BOT Law and the implementing rules and regulations;1avvphil.net

b) sufficient proof of financial commitment from a lending institution sufficient to cover total project cost in accordance with the BOT Law and the implementing rules and regulations;

c) to support its obligation under this Contract, the BOT COMPANY shall submit a security bond to the CLIENT in accordance with the form and amount required under the BOT Law. (Underscoring supplied)

As this Court held in G.R. No. 147465:

As clearly stated in Article 18, JANCOM undertook to comply with the stated conditions within 2 months from execution of the Contract as an effective document. Since the President of the Philippines has not yet affixed his signature on the contract, the same has not yet become an effective document. Thus, the two-month period within which JANCOM should comply with the conditions has not yet started to run. x x x73(Underscoring supplied)

A final point. The argument raised against the authority of Atty. Molina to file respondents’ Omnibus Motion before the RTC does not lie.

Representation continues until the court dispenses with the services of counsel in accordance with Section 26, Rule 138 of the Rules of Court.74 No substitution of counsel of record is allowed unless the following essential requisites concur: (1) there must be a written request for substitution; (2) it must be filed with the written consent of the client; (3) it must be with the written consent of the attorney to be substituted; and (4) in case the consent of the attorney to be substituted cannot be obtained, there must be at least a proof of notice that the motion for substitution was served on him in the manner prescribed by the Rules of Court.75

In the case at bar, there is no showing that there was a valid substitution of counsel at the time Atty. Molina filed the Omnibus Motion on July 29, 2002 before the RTC, nor that he had priorly filed a Withdrawal of Appearance. He thus continued to enjoy the presumption of authority granted to him by respondents.

While clients undoubtedly have the right to terminate their relations with their counsel and effect a substitution or change at any stage of the proceedings, the exercise of such right is subject to compliance with the prescribed requirements. Otherwise, no substitution can be effective and the counsel who last appeared in the case before the substitution became effective shall still be responsible for the conduct of the case.76 The rule is intended to ensure the orderly disposition of cases.77

In the absence then of compliance with the essential requirements for valid substitution of the counsel of record, Atty. Molina enjoys the presumption of authority granted to him by respondents.

In light of the foregoing disquisition, a discussion of the other matters raised by petitioners has been rendered unnecessary.

WHEREFORE, the petition is GRANTED. The Decision dated December 19, 2003 and Resolution dated May 11, 2004 of the Court of Appeals in CA-G.R. SP No. 78752 are REVERSED and SET ASIDE. The June 11, 2003 Order of the Regional Trial Court of Pasig, Branch 68 in SCA No. 1955 is declared NULL and VOID.

SO ORDERED.

CONCHITA CARPIO MORALESAssociate Justice

WE CONCUR:

LEONARDO A. QUISUMBINGAssociate JusticeChairperson

ANTONIO T. CARPIOAssociate Justice

DANTE O. TINGAAsscociate Justice

PRESBITERO J. VELASCO, JR.Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBINGAssociate JusticeChairperson

C E R T I F I C A T I O N

Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairperson’s Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court.

REYNATO S. PUNOActing Chief Justice

Footnotes

1 Rollo, pp. 6-20 (First half of rollo is paged 1-391 the next half is paged 292-345).

2 Id. at 21-23.

3 Penned by Justice Noel G. Tijam and concurred in by Justices Ruben T. Reyes (now Presiding Justice) and Edgardo P. Cruz.

4 Rollo, pp. 330-367.

5 Records, Vol. 1, p. 70.

6 Id. at 171-172.

7 Id. at 170.

8 Id. at 1-21.

9 Rollo, pp. 73-76.

10 The dispositive portion of the decision reads, quoted verbatim:

WHEREFORE, in view of the foregoing, the Court hereby renders judgment in favor of petitioners JANCOM ENVIRONMENTAL CORP., and JANCOM INTERNATIONAL DEVELOPMENT PROJECTS PTY., LIMITED OF AUSTRALIA, and against respondents GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMM., and HON. ROBERTO N. AVENTAJADO, in his Capacity as Chairman of the said Committee, METRO MANILA DEVELOPMENT AUTHORITY and HON. JEJOMAR C. BINAY, in his capacity as Chairman of said Authority, declaring the Resolution of respondent Greater Metropolitan Manila Solid Waste Management Committee disregarding petitioners’ BOT Award Contract and calling for bids for and authorizing a new contract for the Metro Manila waste management ILLEGAL and VOID.

Moreover, respondents and their agents are hereby PROHIBITED and ENJOINED from implementing the aforesaid Resolution and disregarding petitioners’ BOT Award Contract and from making another award in its place.

Let it be emphasized that this Court is not preventing or stopping the government from Implementing Infrastructure projects as it is aware of the proscription under PD 1818. On the contrary, the Court is paving the way for the necessary and modern solution to the perennial garbage problem that has been the major headache of the government and in the process would serve to attract more investors in the country.

SO ORDERED.

11 Records, Vol. I, pp. 279-311.

12 Rollo, pp. 77-96.

13 Id. at 97-118.

14 Id. at 312-318.

15 Id. at 325-329.

16 Id. at 119-134.

17 Id. at 129-131.

18 Records, Vol. II, pp. 590-596.

19 Id. at 634-641.

20 Id. at 644-647.

21 16.1 Dispute Resolution

The parties agree to settle amicably any dispute or controversy arising in connection with this Contract. In the event such dispute or disagreement cannot be resolved, the matter shall be submitted to arbitration.

Consequently, no Party shall be entitled to commence or maintain any action in court of law upon any matter in dispute until such matter shall have been submitted and determined by arbitration as provided below and then only for the enforcement of such arbitration and thereafter until the arbitrators publish their award, the Parties shall continue to perform all their obligations under this Agreement without prejudice to a final adjustment in accordance with such award.

The Parties agree that the arbitration proceedings shall be in the English language, under the rules of conciliation and arbitration of the International Chambers of Commerce, at London, Great Britain.

Upon mutual agreement the Parties may submit their dispute for Arbitration under the Republic Act No. 876 of Philippines.

22 Records, Vol. II, p. 759.

23 Id. at 713-715.

24 Id. at 731-732.

25 Id. at 733-738.

26 Id. at 746.

27 Id. at 824-828 and 831-852.

28 Rollo, pp. 199-204.

29 Id. at 204.

30 Records, Vol. II, pp. 859-861.

31 Id. at 862.

32 Ibid.

33 Rollo, pp. 205-220.

34 Id. at 221-238.

35 Id. at 239-256.

36 Id. at 288-295.

37 Id. at 12-19.

38 Id. at 298-306.

39 Id. at 32-54.

40 Id. at 40-41.

41 Id. at 370-384.

42 Id. at 295-300.

43 Id. at 314-316.

44 Id. at 331-333.

45 Id. at 43.

46 18.1.5. To support its obligation under this Contract, the BOT COMPANY (JANCOM) shall post Performance Security either in the form of cash, manager’s check, bank draft or other security reasonable and acceptable to the CLIENT (the Republic) in the amount allowed in the BOT Law.

47 Gatchalian v. Court of Appeals, G.R. No. 161645, July 30, 2004, 435 SCRA 681, 688 (citation omitted), Adlawan v. Tomol, G.R. No. 63225, April 3, 1990, 184 SCRA 31, 39 (citations omitted), Torno v. Intermediate Appellate Court, G.R. No. L-72622, October 28, 1988, 166 SCRA 742, 751 (citations omitted), Pamantasan ng Lungsod ng Maynila v. Intermediate Appellate Court, 227 Phil. 289, 292 (1986) (citations omitted), Balintawak Construction Supply Corporation v. Valenzuela, 209 Phil. 270, 275 (1983).

48 Reburiano v. Court of Appeals, 361 Phil. 294, 302 (1999) (citation omitted), Limpin, Jr. v. Intermediate Appellate Court, G.R. No. L-70987, January 30, 1987, 147 SCRA 516, 522-23 (citations omitted).

49 Separa v. Atty. Maceda, 431 Phil 1, 8 (2002) (citation omitted), Philippine Bank of Communications v. Court of Appeals, 344 Phil 777, 791 (1997), Government Service Insurance System v. Court of Appeals, G.R. No. 103590, January 29, 1993, 218 SCRA 233, 250, Pamantasan ng Lungsod ng Maynila v. Intermediate Appellate Court, 227 Phil 289, 292

(1986).

50 Philippine Virginia Tobacco Adm. v. Gonzales, G.R. No. L-34628, July 30, 1979, 92 SCRA 172, 185 (citations omitted).

51 Equatorial Realty Dev’t, Inc. v. Mayfair Theater, Inc., 387 Phil 885, 895 (2000) (citations omitted), Nazareno v. Court of Appeals, 383 Phil 229, 231 (2000) (citation omitted), Bobis v. Provincial Sheriff of Camarines Norte, 206 Phil 26, 33 (1983) (citation omitted),Windor Steel Mfg. Co., Inc. v. Court of Appeals, G.R. No. L-34332, January 27, 1981, 102 SCRA 275, 284 (citation omitted),Gamboa’s Incorporated v. Court of Appeals, G.R. No. L-23634, July 29, 1976, 72 SCRA 131, 137-138 (citation omitted), Collector of Internal Revenue v. Gutierrez, 108 Phil 215, 219-220 (citation omitted), Villoria v. Piccio, 95 Phil 802, 805-806 (1954) (citation omitted).

52 Metropolitan Manila Development Authority v. Jancom Environmental Corporation, 425 Phil. 961, 981-82 (2002).

53 Rollo, p. 318.

54 Doliente v. Blanco, 87 Phil 670, 674 (1950) (citation omitted).

55 Bank of the Philippine Islands v. Green, 48 Phil 284, 288 (1925).

56 Rollo, p. 202.

57 Id. at 44.

58 Rollo, p. 17.

59 Vide: Luxuria Homes, Inc. v. Court of Appeals (361 Phil. 989, 1004 [1999]) where this Court found: "Although it appears that there was an agreement for the development of the area, there is no showing that the same was ever perfected and finalized. Private respondents presented in evidence only drafts of a proposed management contract with petitioner’s handwritten marginal notes but the management contract was not put in its final form. The reason why there was no final uncorrected draft was because the parties could not agree on the stipulations of said contract x x x. As a consequence the management drafts submitted by the private respondents should at best be considered as mere unaccepted offers;" and Riker v. Ople (G.R. No. L-50492, October 27, 1987, 155 SCRA 85, 94) where this Court held: "Of prime importance is the fact that the proposed x x x contract, not having been signed by private respondent, lacks consent which is the first essential requisite of every contract (Art. 1319, Civil Code)."

60 Rollo, p. 358.

61 Swedish Match, AB v. Court of Appeals, G.R. No. 128120, October 20, 2004, 441 SCRA 1, 18 (citation omitted), Insular Life Assurance Company, Ltd. v. Asset Builders Corporation, G.R. No. 147410, February 5, 2004, 422 SCRA 148, 159-160 (citations omitted).

62 Firme v. Bukal Enterprises and Development Corporation, G.R. No. 146608, October 23, 2003, 414 SCRA 190, 206 (citation omitted), Salonga v. Farrales, 192 Phil. 614, 622-623 (1981).

63 IV A. Tolentino, commentaries and jurisprudence on the civil code of the philippines, 447 (1997 ed.).

64 Ibid.

65 Rollo, pp. 108-109.

66 CA rollo, pp. 102-103.

67 Id. at 103.

68 Id. at 263-266.

69 Id. at 263-265.

70 Weldon Construction Corporation v. Court of Appeals, G.R. No. L-35721, October 12, 1987, 154 SCRA 618, 628 (citation omitted).

71 Mendoza v. Court of Appeals, 412 Phil. 14, 28 (2001) (citation omitted).

72 Luxuria Homes, Inc. v. Court of Appeals, supra note 59 at 1005.

73 Metropolitan Manila Development Authority v. Jancom Environmental Corporation, supra note 52 at 981.

74 Rollo, p. 22.

75 Pioneer Insurance & Surety Corporation v. De Dios Transportation Co., Inc., 454 Phil. 409, 427 (2003) (citation omitted), Santana-Cruz v. Court of Appeals, 414 Phil. 47, 61 (2001) (citations omitted), Bernardo v. Court of Appeals, 341 Phil. 413, 425-6 (1997) (citations omitted), Nacuray v. NLRC, 336 Phil. 749, 754-5 (1997) (citation omitted), Rinconada Telephone Company, Inc. v. Buenviaje, G.R. No. 49241-42, April 27, 1990, 184 SCRA 701, 754-755, Sumadchat v. Court of Appeals, 197 Phil. 465, 477 (1982).

76 Nacuray v. National Labor Relations Commission, supra note 75 at 755.

77 Santana-Cruz v. Court of Appeals, supra note 75 at 62 (citation omitted).Republic of the Philippines

SUPREME COURTManila

THIRD DIVISION

G.R. No. 163663             June 30, 2006

GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMMITTEE and the METROPOLITAN MANILA DEVELOPMENT AUTHORITY, Petitioners, 

vs.JANCOM ENVIRONMENTAL CORPORATION and JANCOM INTERNATIONAL

DEVELOPMENT PROJECTS PTY. LIMITED OF AUSTRALIA, Respondents.

D E C I S I O N

CARPIO MORALES, J.:

The present petition for review on certiorari challenges the Decision1 dated December 19, 2003 and Resolution2 dated May 11, 2004 of the Court of Appeals (CA)3 in CA-G.R. SP No. 78752 which denied

the petition for certiorari filed by herein petitioners Greater Metropolitan Manila Solid Waste Management Committee (GMMSWMC) and the Metropolitan Manila Development Authority

(MMDA) and their Motion for Reconsideration, respectively.

In 1994, Presidential Memorandum Order No. 202 was issued by then President Fidel V. Ramos creating an Executive Committee to oversee and develop waste-to-energy projects for the waste disposal

sites in San Mateo, Rizal and Carmona, Cavite under the Build-Operate-Transfer (BOT) scheme.

Respondent Jancom International Development Projects Pty. Limited of Australia (Jancom International) was one of the bidders for the San Mateo Waste Disposal Site. It subsequently entered

into a partnership with Asea Brown Boveri under the firm name JANCOM Environmental Corporation (JANCOM), its co-respondent.

On February 12, 1997, the above-said Executive Committee approved the recommendation of the Pre-qualification, Bids and Awards Committee to declare JANCOM as the sole complying bidder for the

San Mateo Waste Disposal Site.

On December 19, 1997, a Contract for the BOT Implementation of the Solid Waste Management Project for the San Mateo, Rizal Waste Disposal Site4 (the contract) was entered into by the Republic of the Philippines, represented by the Presidential Task Force on Solid Waste Management through then

Department of Environment and Natural Resources Secretary Victor Ramos, then Cabinet Office for Regional Development-National Capital Region Chairman Dionisio dela Serna, and then MMDA

Chairman Prospero Oreta on one hand, and JANCOM represented by its Chief Executive Officer Jorge Mora Aisa and its Chairman Jay Alparslan, on the other.

On March 5, 1998, the contract was submitted for approval to President Ramos who subsequently endorsed it to then incoming President Joseph E. Estrada.

Owing to the clamor of the residents of Rizal, the Estrada administration ordered the closure of the San Mateo landfill. Petitioner GMMSWMC thereupon adopted a Resolution not to pursue the contract with JANCOM, citing as reasons therefor the passage of Republic Act 8749, otherwise known as the Clean

Air Act of 1999, the non-availability of the San Mateo site, and costly tipping fees.5

The Board of Directors of Jancom International thereafter adopted on January 4, 2000 a Resolution6 authorizing Atty. Manuel Molina to act as legal counsel for respondents and "determine and

file such legal action as deemed necessary before the Philippine courts in any manner he may deem appropriate" against petitioners.

The Board of Directors of JANCOM also adopted a Resolution7 on February 7, 2000 granting Atty. Molina similar authorization to file legal action as may be necessary to protect its interest with respect to

the contract.

On March 14, 2000, respondents filed a petition for certiorari8 with the Regional Trial Court (RTC) of Pasig City where it was docketed as Special Civil Action No. 1955, to declare the GMMSWMC

Resolution and the acts of the MMDA calling for bids for and authorizing the forging of a new contract for the Metro Manila waste management as illegal, unconstitutional and void and to enjoin petitioners

from implementing the Resolution and making another award in lieu thereof.

By Decision9 of May 29, 2000, Branch 68 of the Pasig City RTC found in favor of respondents.10

Petitioners thereupon assailed the RTC Decision via petition for certiorari11 with prayer for a temporary restraining order with the CA, docketed as CA-G.R. SP No. 59021.

By Decision12 of November 13, 2000, the CA denied the petition for lack of merit and affirmed in toto the May 29, 2000 RTC Decision. Petitioners’ Motion for Reconsideration was denied, prompting them

to file a petition for review before this Court, docketed as G.R. No. 147465.

By Decision13 of January 30, 2002 and Resolution14 of April 10, 2002, this Court affirmed the November 13, 2001 CA Decision and declared the contract valid and perfected, albeit ineffective and

unimplementable pending approval by the President.

JANCOM and the MMDA later purportedly entered into negotiations to modify certain provisions of the contract which were embodied in adraft Amended Agreement15 dated June 2002. The draft Amended

Agreement bore no signature of the parties.

Respondents, through Atty. Molina, subsequently filed before Branch 68 of the Pasig City RTC an Omnibus Motion16 dated July 29, 2002 praying that: (1) an alias writ of execution be issued prohibiting

and enjoining petitioners and their representatives from calling for, accepting, evaluating, approving, awarding, negotiating or implementing all bids, awards and contracts involving other Metro Manila

waste management projects intended to be pursued or which are already being pursued; (2) the MMDA, through its Chairman Bayani F. Fernando, be directed to immediately forward and recommend the

approval of the Amended Agreement to President Gloria Macapagal Arroyo; (3) Chairman Fernando be ordered to personally appear before the court and explain his acts and public pronouncements which are

in direct violation and gross defiance of the final and executory May 29, 2000 RTC Decision; (4) the Executive Secretary and the Cabinet Secretaries of the departments-members of the National Solid

Waste Management Commission be directed "to submit the contract within 30 days from notice to the President for signature and approval and if the latter chooses not to sign or approve the contract, the

Executive Secretary be made to show cause therefor;" and (5) petitioners be directed to comply with and submit their written compliance with their obligations specifically directed under the provisions of

Article 18, paragraphs 18.1, 18.1.1 (a), (b), (c) and (d) of the contract within 30 days from notice.17

To the Omnibus Motion petitioners filed their Opposition18 which merited JANCOM’s Reply19 filed on August 19, 2002.

On August 21, 2002, Atty. Simeon M. Magdamit, on behalf of Jancom International, filed before the RTC an Entry of Special Appearance and Manifestation with Motion to Reject the Pending Omnibus Motion20 alleging that: (1) the Omnibus Motion was never approved by Jancom International; (2) the Omnibus Motion was initiated by lawyers whose services had already been terminated, hence, were unauthorized to represent it; and (3) the agreed judicial venue for dispute resolution relative to the

implementation of the contract is the International Court of Arbitration in the United Kingdom pursuant to Article 16.121 of said contract.

In the meantime, on November 3, 2002, the MMDA forwarded the contract to the Office of the President for appropriate action,22 together with MMDA Resolution No. 02-1823 dated June 26, 2002, "Recommending to her Excellency the President of the Republic of the Philippines to Disapprove the

Contract Entered Into by the Executive Committee of the Presidential Task Force on Waste

Management with Jancom Environmental Corporation and for Other Purposes."

By Order24 of November 18, 2002, the RTC noted the above-stated Entry of Special Appearance of Atty. Magdamit for Jancom International and denied the Motion to Reject Pending Omnibus Motion for lack of merit. Jancom International filed on December 9, 2002 a Motion for Reconsideration25 which

was denied for lack of merit by Order26 of January 8, 2003.

Petitioners and respondents then filed their Memoranda27 on May 23, 2003 and May 26, 2003, respectively.

By Order28 of June 11, 2003, the RTC granted respondents’ Omnibus Motion in part. The dispositive portion of the Order reads, quotedverbatim:

WHEREFORE, in view of the foregoing, let an Alias Writ of Execution immediately issue and the Clerk of Court and Ex-Oficio Sheriff or any o[f] her Deputies is directed to implement the same within sixty

(60) days from receipt thereof.

Thus, any and all such bids or contracts entered into by respondent MMDA with third parties covering the waste disposal and management within the Metro Manila after August 14, 2000 are hereby declared

NULL and VOID. Respondents are henceforth enjoined and prohibited, with a stern warning, from entering into any such contract with any third party whether directly or indirectly, in violation of the

contractual rights of petitioner JANCOM under the BOT Contract Award, consistent with the Supreme Court’s Decision of January 30, 2002.

Respondent MMDA is hereby directed to SUBMIT the Amended Agreement concluded by petitioners with the previous MMDA officials, or in its discretion if it finds [it] more advantageous to the

government, to require petitioners to make adjustments in the Contract in accordance with existing environmental laws and other relevant concerns, and thereafter forward the Amended Agreement for

signature and approval by the President of the Philippines. The concerned respondents are hereby further directed to comply fully and in good faith with its institutional obligations or undertakings as provided

in Article 18 of the BOT Contract.

Let a copy of this Order be furnished the Office of the Clerk of Court and the Commission on Audit for its information and guidance.

SO ORDERED.29 (Emphasis in the original)

On June 23, 2003 the RTC issued an Alias Writ of Execution30 reading:

WHEREAS, on May 29, 2000, a Decision was rendered by this Court in the above-entitled case, the pertinent portions of which is [sic] hereunder quoted as follows:

WHEREFORE, in view of the foregoing, the Court hereby renders judgment in favor of petitioners JANCOM ENVIRONMENTAL CORP and JANCOM INTERNATIONAL DEVELOPMENT

PROJECTS PTY., LIMITED OF AUSTRALIAS [sic], and against respondents GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMM., and HON. ROBERTO N.

AVENTAJADO, in his capacity as Chairman of the said Committee, METRO MANILA DEVELOPMENT AUTHORITY and HON. JEJOMAR C. BINAY, in his capacity as Chairman of said

Authority, declaring the Resolution of respondent Greater Metropolitan Manila Solid Waste Management Committee disregarding petitioners’ BOT Award Contract and calling for bids for and

authorizing a new contract for the Metro Manila waste management ILLEGAL an[d] VOID.

Moreover, respondents and their agents are hereby PROHIBITED and ENJOINED from implementing the aforesaid Resolution and disregarding petitioners’ BOT Award Contract and from making another

award in its place.

Let it be emphasized that this Court is not preventing or stopping the government from implementing infrastructure projects as it is aware of the proscription under PD 1818. On the contrary, the Court is paving the way for the necessary and modern solution to the perennial garbage problem that has been the major headache of the government and in the process would serve to attract more investors in the

country.

SO ORDERED.

WHEREAS, on August 7, 2000, petitioners through counsel filed a "Motion for Execution" which the Court GRANTED in its Order dated August 14, 2000;

WHEREAS, as a consequence thereof, a Writ of Execution was issued on August 14, 2000 and was duly served upon respondents as per Sheriff’s Return dated August 27, 2000;

WHEREAS, ON July 29, 2002, petitioners through counsel filed an "Omnibus Motion," praying, among others, for the issuance of an Alias Writ of Execution which the Court GRANTED in its Order dated

June 11, 2003, the dispositive portion of which reads as follows:

WHEREFORE, in view of the foregoing, let an Alias Writ of Execution immediately issue and the Clerk of Court and Ex-Oficio Sheriff or any of her Deputies is directed to implement the same within sixty

(60) days from receipt thereof.

Thus, any and all such bids or contracts entered into by respondent MMDA [with] third parties covering the waste disposal and management within the Metro Manila after August 14, 2000 are hereby declared

NULL and VOID. Respondents are henceforth enjoined and prohibited, with a stern warning, from entering into any such contract with any third party whether directly or indirectly, in violation of the contractual rights of petitioner Jancom under the BOT Contract Award, consistent with the Supreme

Court’s Decision of January 30, 2002.

Respondent MMDA is hereby directed to SUBMIT the Amended Agreement concluded by petitioners with the previous MMDA officials, or in its discretion if it finds [it] more advantageous to the

government, to require petitioners to make adjustments in the Contract in accordance with existing environmental laws and other relevant concerns, and thereafter forward the Amended Agreement for

signature and approval by the President of the Philippines. The concerned respondents are hereby further directed to comply fully and in good faith with its institutional obligations or undertakings as provided

in Article 18 of the BOT Contract.

Let a copy of this Order be furnished the Office of the Clerk of Court and the Commission on Audit for its information and guidance.

SO ORDERED.

x x x x (Emphasis in the original)

By letter31 of August 15, 2003, Chairman Fernando advised Sheriff Alejandro Q. Loquinario of the Office of the Clerk of Court and Ex-Oficio Sheriff, Pasig City RTC that:

1. MMDA has not entered into a new contract for solid waste management in lieu of JANCOM’s

Contract.

2. JANCOM’s Contract has been referred to the Office of the President for appropriate action.

3. Without the President’s approval, JANCOM’s Contract cannot be implemented.32

Petitioners later challenged the RTC June 11, 2003 Order via petition for certiorari33 with prayer for the issuance of a temporary restraining order and/or writ of preliminary injunction before the CA. They

subsequently filed an Amended Petition34 on September 26, 2003.

To the Amended Petition JANCOM filed on October 8, 2003 its Comment35 after which petitioners filed their Reply36 on November 24, 2003.

By the challenged Decision of December 19, 2003, the CA denied the petition and affirmed the June 11, 2003 RTC Order in this wise:

The Supreme Court ruled that the Jancom contract has the force of law and the parties must abide in good faith by their respective contractual commitments. It is precisely this pronouncement that the alias

writ of execution issued by respondent judge seeks to enforce. x x x

x x x x

The fact that the Jancom contract has been declared unimplementable without the President’s signature, would not excuse petitioners’ failure to comply with their undertakings under Article 18 of the contract.

x x x

x x x x

Petitioners complain that respondent judge focused only on requiring them to perform their supposed obligations under Article 18 of the contract when private respondents are also required thereunder to

post a Performance Security acceptable to the Republic in the amount allowed in the BOT Law. Petitioners’ complaint is not justified. x x x

x x x x

It cannot x x x be said that respondent judge had been unfair or one-sided in directing only petitioners to fulfill their own obligations under Article 18 of the Jancom contract. Compliance with private

respondents’ obligations under the contract had not yet become due.

x x x x

There is no debate that the trial court’s Decision has attained finality. Once a judgment becomes final and executory, the prevailing party can have it executed as a matter of right and the granting of

execution becomes a mandatory or ministerial duty of the court. After a judgment has become final and executory, vested rights are acquired by the winning party. Just as the losing party has the right to file an

appeal within the prescribed period, so also the winning party has the correlative right to enjoy the finality of the resolution of the case.

It is true that the ministerial duty of the court to order the execution of a final and executory judgment admits of exceptions as (a) where it becomes imperative in the higher interest of justice to direct the suspension of its execution; or (b) whenever it is necessary to accomplish the aims of justice; or (c)

when certain facts and circumstances transpired after the judgment became final which could render the execution of the judgment unjust. Petitioners have not shown that any of these exceptions exists to

prevent the mandatory execution of the trial court’sDecision.37 (Italics in the original)

Petitioners’ Motion for Reconsideration38 having been denied by the CA by Resolution of May 11, 2004, the present petition for review39was filed on July 12, 2004 positing that:

THE COURT OF APPEALS GRAVELY ERRED IN UPHOLDING THE LOWER COURT AND IN DISREGARDING THE FOLLOWING PROPOSITIONS:

I

THE SUBJECT CONTRACT IS INEFFECTIVE AND UNIMPLEMENTABLE UNTIL AND UNLESS IT IS APPROVED BY THE PRESIDENT.

II

THE SUBJECT CONTRACT ONLY COVERS THE DISPOSITION OF 3,000 TONS OF SOLID WASTE A DAY.

III

THE ALLEGED AMENDED AGREEMENT IS ONLY A DRAFT OR PROPOSAL SUBMITTED BY RESPONDENTS.

IV

RESPONDENTS MUST ALSO BE MADE TO COMPLY WITH THEIR CONTRACTUAL COMMITMENTS.40 (Underscoring supplied)

JANCOM filed on September 20, 2004 its Comment41 on the petition to which petitioners filed their Reply42 on January 28, 2005.

On May 4, 2005, Jancom International filed its Comment,43 reiterating its position that it did not authorize the filing before the RTC by Atty. Molina of the July 29, 2002 Omnibus Motion that

impleaded it as party-movant.

On July 7, 2005, petitioners filed their Reply44 to Jancom International’s Comment.

Petitioners argue that since the contract remains unsigned by the President, it cannot yet be executed. Ergo, they conclude, the proceedings which resulted in the issuance of an alias writ of execution "ran

afoul of the [January 30, 2002] decision of [the Supreme] Court in G.R. No. 147465."45

Petitioners go on to argue that since the contract covers only 3,000 tons of garbage per day while Metro Manila generates at least 6,000 tons of solid waste a day, MMDA may properly bid out the other 3,000

tons of solid waste to other interested groups or entities.

Petitioners moreover argue that the alleged Amended Agreement concluded supposedly between JANCOM and former MMDA Chairman Benjamin Abalos is a mere scrap of paper, a mere draft or

proposal submitted by JANCOM to the MMDA, no agreement on which was reached by the parties; and at all events, express authority ought to have first been accorded the MMDA to conclude such an

amended agreement with JANCOM, the original contract having been concluded between the Republic of the Philippines and JANCOM.

Finally, petitioners argue that respondents should also be required to perform their commitments pursuant to Article 1846 of the contract.

The petition is impressed with merit in light of the following considerations.

Section 1, Rule 39 of the Rules of Court provides:

SECTION 1. Execution upon judgments or final orders. – Execution shall issue as a matter of right, on motion, upon a judgment or order that disposes of the action or proceeding upon the expiration of the

period to appeal therefrom if no appeal has been duly perfected.

If the appeal has been duly perfected and finally resolved, the execution may forthwith be applied for in the court of origin, on motion of the judgment obligee, submitting therewith certified true copies of the

judgment or judgments or final order or orders sought to be enforced and of the entry thereof, with notice to the adverse party.

The appellate court may, on motion in the same case, when the interest of justice so requires, direct the court of origin to issue the writ of execution.

Once a judgment becomes final, it is basic that the prevailing party is entitled as a matter of right to a writ of execution the issuance of which is the trial court’s ministerial duty, compellable by

mandamus.47

There are instances, however, when an error may be committed in the course of execution proceedings prejudicial to the rights of a party. These instances call for correction by a superior court, as where:

1) the writ of execution varies the judgment;

2) there has been a change in the situation of the parties making execution inequitable or unjust;

3) execution is sought to be enforced against property exempt from execution;

4) it appears that the controversy has never been submitted to the judgment of the court;

5) the terms of the judgment are not clear enough and there remains room for interpretation thereof; or

6) it appears that the writ of execution has been improvidently issued, or that it is defective in substance, or is issued against the wrong party, or that the judgment debt has been paid or otherwise satisfied, or

the writ was issued without authority.48 (Emphasis and Underscoring supplied)

That a writ of execution must conform to the judgment which is to be executed, substantially to every essential particular thereof,49 it is settled. It may not thus vary the terms of the judgment it seeks to enforce,50 nor go beyond its terms. Where the execution is not in harmony with the judgment which

gives it life and exceeds it, it has no validity.51

This Court’s January 30, 2002 Decision in G.R. No. 147465 held:

We, therefore, hold that the Court of Appeals did not err when it declared the existence of a valid and

perfected contract between the Republic of the Philippines and JANCOM. There being a perfected contract, MMDA cannot revoke or renounce the same without the consent of the other. From the moment of perfection, the parties are bound not only to the fulfillment of what has been expressly

stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage, and law (Article 1315, Civil Code). The contract has the force of law between the parties

and they are expected to abide in good faith by their respective contractual commitments, not weasel out of them. Just as nobody can be forced to enter into a contract, in the same manner, once a contract is entered into, no party can renounce it unilaterally or without the consent of the other. It is a general

principle of law that no one may be permitted to change his mind or disavow and go back upon his own acts, or to proceed contrary thereto, to the prejudice of the other party. Nonetheless, it has to be repeated that although the contract is a perfected one, it is still ineffective or unimplementable until and unless it

is approved by the President.52 (Emphasis and Underscoring supplied)

This Court’s April 10, 2002 Resolution also in G.R. No. 147465 moreover held:

x x x The only question before the Court is whether or not there is a valid and perfected contract between the parties. As to the necessity, expediency, and wisdom of the contract, these are outside the

realm of judicial adjudication. These considerations are primarily and exclusively a matter for the President to decide. While the Court recognizes that the garbage problem is a matter of grave public

concern, it can only declare that the contract in question is a valid and perfected one between the parties, but the same is still ineffective or unimplementable until and unless it is approved by the President, the contract itself providing that such approval by the President is necessary for its effectivity.53 (Emphasis

and Underscoring supplied)

Article 19 of the contract provides:

Article 19. Effectivity. – This Contract shall become effective upon approval by the President of the Republic of [the] Philippines pursuant to existing Laws subject to condition precedent in Article 18. This Contract shall remain in full force and effect for twenty five (25) years subject to renewal for another twenty five (25) years from the date of Effectivity. Such renewal will be subject to mutual

agreement of the parties and approval by the [P]resident of the Republic of [the] Philippines. (Emphasis and underscoring supplied)

In issuing the alias writ of execution, the trial court in effect ordered the enforcement of the contract despite this Court’s unequivocal pronouncement that albeit valid and perfected, the contract shall

become effective only upon approval by the President.

Indubitably, the alias writ of execution varied the tenor of this Court’s judgment, went against essential portions and exceeded the terms thereof.

x x x a lower court is without supervisory jurisdiction to interpret or to reverse the judgment of the higher court x x x. A judge of a lower court cannot enforce different decrees than those rendered by the

superior court. x x x

The inferior court is bound by the decree as the law of the case, and must carry it into execution according to the mandate. They cannot vary it, or examine it for any other purpose than execution, or give any other or further relief, or review it upon any matter decided on appeal for error apparent, or

intermeddle with it, further than to settle so much as has been remanded. x x x54

The execution directed by the trial court being out of harmony with the judgment, legal implications cannot save it from being found to be fatally defective.55

Notably, while the trial court ratiocinated that it issued on June 23, 2003 the alias writ "to set into motion the legal mechanism for Presidential approval and signature,"56 it failed to take due

consideration of the fact that during the pendency of the Omnibus Motion, the contract had earlier been forwarded for appropriate action on November 3, 2002 by Chairman Fernando to the Office of the

President, with recommendation for its disapproval, which fact the trial court had been duly informed of through pleadings and open court manifestations.57

Additionally, it bears noting that the June 11, 2003 Order of the trial court is likewise indisputably defective in substance for having directed the submission of the draft Amended Agreement to the

President.

The appellate court, in affirming the June 11, 2003 Order of the trial court, overlooked the fact that the Amended Agreement was unsignedby the parties and it instead speculated and rationalized that the

submission thereof to the President would at all events solve the mounting garbage problem in Metro Manila:

We find that the submission of the Amended Agreement to the President will break the impasse now existing between the parties which has effectively halted the government’s efforts to address Metro

Manila’s mounting garbage problem. x x x

As long as petitioners refuse to deal with private respondents, the Metro Manila garbage problem will only continue to worsen. x x x

That the Amended Agreement could have well been negotiated, if not concluded between private respondents and the former MMDA administration, is not far-fetched. Petitioners do not dispute that the

President had referred the Jancom contract to then MMDA Chairman Benjamin Abalos for recommendation. Petitioners also do not dispute that private respondents negotiated with the MMDA for

the amendment of the contract.

Besides, the Amended Agreement does not veer away from the original Jancom contract. x x x58 lawphil.net

The Amended Agreement was, as petitioners correctly allege, merely a draft document containing the proposals of JANCOM, subject to the approval of the MMDA. As earlier stated, it was not signed by the

parties.59

The original contract itself provides in Article 17.6 that it "may not be amended except by a written [c]ontract signed by the parties."60

It is elementary that, being consensual, a contract is perfected by mere consent.61 The essence of consent is the conformity of the parties to the terms of the contract, the acceptance by one of the offer

made by the other;62 it is the concurrence of the minds of the parties on the object and the cause which shall constitute the contract.63 Where there is merely an offer by one party without acceptance by the

other, there is no consent and the contract does not come into existence.64

As distinguished from the original contract in which this Court held in G.R. No. 147465:

x x x the signing and execution of the contract by the parties clearly show that, as between the parties, there was concurrence of offer and acceptance with respect to the material details of the contract,

thereby giving rise to the perfection of the contract. The execution and signing of the contract is not disputed by the parties x x x,65

the parties did not, with respect to the Amended Agreement, get past the negotiation stage. No meeting of minds was established. While there was an initial offer made, there was no acceptance.

Even JANCOM President Alfonso G. Tuzon conceded, by letter66 of June 17, 2002 to Chairman Fernando, that the Amended Agreement was a mere proposal:

Apropos to all these, we are seeking an urgent EXECUTIVE SESSION on your best time and venue. We can thresh up major points to establish a common perspective based on data and merit.

We are optimistic you shall then consider with confidence the proposed Amended Contract which incorporates the adjustments we committed to as stated and earlier submitted to your Office during the

incumbency of your predecessor, for evaluation and appropriate action by NEDA in compliance with the BOT Law and Article 18.1.1 of our contract.67

While respondents aver that an acceptance was made, they have not proffered any proof. While indeed the MMDA, by a letter68 issued by then MMDA General Manager Jaime Paz, requested then Secretary

of Justice Hernando B. Perez for his legal opinion on the draft Amended Agreement, nowhere in the letter is there any statement indicating that the MMDA, or the Republic of the Philippines for that

matter, had approved respondents’ proposals embodied in the said draft agreement.

The pertinent portions of the letter read:

Attention: HON. HERNANDO B. PEREZ

Secretary

Subject: Request for Opinion Regarding the Compromise Offer of Jancom Environmental Corporation for the Municipal Solid Waste Management of Metro Manila

Dear Secretary Perez:

This is to respectfully request for an opinion from your Honorable Office regarding the Compromise Proposal offered by JANCOM Environmental Corporation ("JANCOM") in relation to its Contract for the BOT Implementation of the Waste Management Project for the San Mateo, Rizal Waste Disposal

Site dated 19 December 1997 (hereinafter referred to as the BOT Contract for brevity) with the Republic of the Philippines.

x x x x

x x x this representation is requesting your Honorable Office to render a legal opinion on the following:

Does the offer of JANCOM to temporarily set aside the waste-to-energy plant and implement only the other two major components of the BOT Contract amount to a novation of the BOT Contract, and

therefore necessitating a re-bidding? If the same does not amount to a novation, by what authority may Jancom set aside temporarily a major component of the BOT Contract?

x x x x69

Only an absolute or unqualified acceptance of a definite offer manifests the consent necessary to perfect a contract.70 If at all, the MMDA letter only shows that the parties had not gone beyond the preparation stage, which is the period from the start of the negotiations until the moment just before the agreement

of the parties.71 Obviously, other material considerations still remained before the Amended Agreement could be perfected. At any time prior to the perfection of a contract, unaccepted offers and proposals

remain as such and cannot be considered as binding commitments.72

Respecting petitioners’ argument that respondents should be directed to comply with their commitments under Article 18 of the contract, this Court is not convinced.

Article 18.2.1 of the contract provides:

18.2.1 The BOT COMPANY hereby undertakes to provide the following within 2 months from execution of this Contract as an effective document:

a) sufficient proof of the actual equity contributions from the proposed shareholders of the BOT COMPANY in a total amount not less than PHP 500,000,000 in accordance with the BOT Law and the

implementing rules and regulations;1avvphil.net

b) sufficient proof of financial commitment from a lending institution sufficient to cover total project cost in accordance with the BOT Law and the implementing rules and regulations;

c) to support its obligation under this Contract, the BOT COMPANY shall submit a security bond to the CLIENT in accordance with the form and amount required under the BOT Law. (Underscoring

supplied)

As this Court held in G.R. No. 147465:

As clearly stated in Article 18, JANCOM undertook to comply with the stated conditions within 2 months from execution of the Contract as an effective document. Since the President of the Philippines has not yet affixed his signature on the contract, the same has not yet become an effective document. Thus, the two-month period within which JANCOM should comply with the conditions has not yet

started to run. x x x73(Underscoring supplied)

A final point. The argument raised against the authority of Atty. Molina to file respondents’ Omnibus Motion before the RTC does not lie.

Representation continues until the court dispenses with the services of counsel in accordance with Section 26, Rule 138 of the Rules of Court.74 No substitution of counsel of record is allowed unless the following essential requisites concur: (1) there must be a written request for substitution; (2) it must be filed with the written consent of the client; (3) it must be with the written consent of the attorney to be substituted; and (4) in case the consent of the attorney to be substituted cannot be obtained, there must

be at least a proof of notice that the motion for substitution was served on him in the manner prescribed by the Rules of Court.75

In the case at bar, there is no showing that there was a valid substitution of counsel at the time Atty. Molina filed the Omnibus Motion on July 29, 2002 before the RTC, nor that he had priorly filed a

Withdrawal of Appearance. He thus continued to enjoy the presumption of authority granted to him by respondents.

While clients undoubtedly have the right to terminate their relations with their counsel and effect a substitution or change at any stage of the proceedings, the exercise of such right is subject to compliance

with the prescribed requirements. Otherwise, no substitution can be effective and the counsel who last appeared in the case before the substitution became effective shall still be responsible for the conduct of

the case.76 The rule is intended to ensure the orderly disposition of cases.77

In the absence then of compliance with the essential requirements for valid substitution of the counsel of record, Atty. Molina enjoys the presumption of authority granted to him by respondents.

In light of the foregoing disquisition, a discussion of the other matters raised by petitioners has been rendered unnecessary.

WHEREFORE, the petition is GRANTED. The Decision dated December 19, 2003 and Resolution dated May 11, 2004 of the Court of Appeals in CA-G.R. SP No. 78752 are REVERSED and SET

ASIDE. The June 11, 2003 Order of the Regional Trial Court of Pasig, Branch 68 in SCA No. 1955 is declared NULL and VOID.

SO ORDERED.

CONCHITA CARPIO MORALESAssociate Justice

WE CONCUR:

LEONARDO A. QUISUMBINGAssociate JusticeChairperson

ANTONIO T. CARPIOAssociate Justice

DANTE O. TINGAAsscociate Justice

PRESBITERO J. VELASCO, JR.Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBINGAssociate Justice

Chairperson

C E R T I F I C A T I O N

Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairperson’s Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case

was assigned to the writer of the opinion of the Court.

REYNATO S. PUNOActing Chief Justice

Footnotes

1 Rollo, pp. 6-20 (First half of rollo is paged 1-391 the next half is paged 292-345).

2 Id. at 21-23.

3 Penned by Justice Noel G. Tijam and concurred in by Justices Ruben T. Reyes (now Presiding Justice) and Edgardo P. Cruz.

4 Rollo, pp. 330-367.

5 Records, Vol. 1, p. 70.

6 Id. at 171-172.

7 Id. at 170.

8 Id. at 1-21.

9 Rollo, pp. 73-76.

10 The dispositive portion of the decision reads, quoted verbatim:

WHEREFORE, in view of the foregoing, the Court hereby renders judgment in favor of petitioners JANCOM ENVIRONMENTAL CORP., and JANCOM INTERNATIONAL DEVELOPMENT

PROJECTS PTY., LIMITED OF AUSTRALIA, and against respondents GREATER METROPOLITAN MANILA SOLID WASTE MANAGEMENT COMM., and HON. ROBERTO N.

AVENTAJADO, in his Capacity as Chairman of the said Committee, METRO MANILA DEVELOPMENT AUTHORITY and HON. JEJOMAR C. BINAY, in his capacity as Chairman of said

Authority, declaring the Resolution of respondent Greater Metropolitan Manila Solid Waste Management Committee disregarding petitioners’ BOT Award Contract and calling for bids for and

authorizing a new contract for the Metro Manila waste management ILLEGAL and VOID.

Moreover, respondents and their agents are hereby PROHIBITED and ENJOINED from implementing the aforesaid Resolution and disregarding petitioners’ BOT Award Contract and from making another

award in its place.

Let it be emphasized that this Court is not preventing or stopping the government from Implementing Infrastructure projects as it is aware of the proscription under PD 1818. On the contrary, the Court is paving the way for the necessary and modern solution to the perennial garbage problem that has been the major headache of the government and in the process would serve to attract more investors in the

country.

SO ORDERED.

11 Records, Vol. I, pp. 279-311.

12 Rollo, pp. 77-96.

13 Id. at 97-118.

14 Id. at 312-318.

15 Id. at 325-329.

16 Id. at 119-134.

17 Id. at 129-131.

18 Records, Vol. II, pp. 590-596.

19 Id. at 634-641.

20 Id. at 644-647.

21 16.1 Dispute Resolution

The parties agree to settle amicably any dispute or controversy arising in connection with this Contract. In the event such dispute or disagreement cannot be resolved, the matter shall be submitted to

arbitration.

Consequently, no Party shall be entitled to commence or maintain any action in court of law upon any matter in dispute until such matter shall have been submitted and determined by arbitration as provided below and then only for the enforcement of such arbitration and thereafter until the arbitrators publish their award, the Parties shall continue to perform all their obligations under this Agreement without

prejudice to a final adjustment in accordance with such award.

The Parties agree that the arbitration proceedings shall be in the English language, under the rules of conciliation and arbitration of the International Chambers of Commerce, at London, Great Britain.

Upon mutual agreement the Parties may submit their dispute for Arbitration under the Republic Act No. 876 of Philippines.

22 Records, Vol. II, p. 759.

23 Id. at 713-715.

24 Id. at 731-732.

25 Id. at 733-738.

26 Id. at 746.

27 Id. at 824-828 and 831-852.

28 Rollo, pp. 199-204.

29 Id. at 204.

30 Records, Vol. II, pp. 859-861.

31 Id. at 862.

32 Ibid.

33 Rollo, pp. 205-220.

34 Id. at 221-238.

35 Id. at 239-256.

36 Id. at 288-295.

37 Id. at 12-19.

38 Id. at 298-306.

39 Id. at 32-54.

40 Id. at 40-41.

41 Id. at 370-384.

42 Id. at 295-300.

43 Id. at 314-316.

44 Id. at 331-333.

45 Id. at 43.

46 18.1.5. To support its obligation under this Contract, the BOT COMPANY (JANCOM) shall post Performance Security either in the form of cash, manager’s check, bank draft or other security

reasonable and acceptable to the CLIENT (the Republic) in the amount allowed in the BOT Law.

47 Gatchalian v. Court of Appeals, G.R. No. 161645, July 30, 2004, 435 SCRA 681, 688 (citation omitted), Adlawan v. Tomol, G.R. No. 63225, April 3, 1990, 184 SCRA 31, 39 (citations

omitted), Torno v. Intermediate Appellate Court, G.R. No. L-72622, October 28, 1988, 166 SCRA 742, 751 (citations omitted), Pamantasan ng Lungsod ng Maynila v. Intermediate Appellate Court, 227 Phil. 289, 292 (1986) (citations omitted), Balintawak Construction Supply Corporation v. Valenzuela, 209

Phil. 270, 275 (1983).

48 Reburiano v. Court of Appeals, 361 Phil. 294, 302 (1999) (citation omitted), Limpin, Jr. v. Intermediate Appellate Court, G.R. No. L-70987, January 30, 1987, 147 SCRA 516, 522-23 (citations

omitted).

49 Separa v. Atty. Maceda, 431 Phil 1, 8 (2002) (citation omitted), Philippine Bank of Communications v. Court of Appeals, 344 Phil 777, 791 (1997), Government Service Insurance System v. Court of

Appeals, G.R. No. 103590, January 29, 1993, 218 SCRA 233, 250, Pamantasan ng Lungsod ng Maynila

v. Intermediate Appellate Court, 227 Phil 289, 292 (1986).

50 Philippine Virginia Tobacco Adm. v. Gonzales, G.R. No. L-34628, July 30, 1979, 92 SCRA 172, 185 (citations omitted).

51 Equatorial Realty Dev’t, Inc. v. Mayfair Theater, Inc., 387 Phil 885, 895 (2000) (citations omitted), Nazareno v. Court of Appeals, 383 Phil 229, 231 (2000) (citation omitted), Bobis v. Provincial

Sheriff of Camarines Norte, 206 Phil 26, 33 (1983) (citation omitted),Windor Steel Mfg. Co., Inc. v. Court of Appeals, G.R. No. L-34332, January 27, 1981, 102 SCRA 275, 284 (citation

omitted),Gamboa’s Incorporated v. Court of Appeals, G.R. No. L-23634, July 29, 1976, 72 SCRA 131, 137-138 (citation omitted), Collector of Internal Revenue v. Gutierrez, 108 Phil 215, 219-220 (citation

omitted), Villoria v. Piccio, 95 Phil 802, 805-806 (1954) (citation omitted).

52 Metropolitan Manila Development Authority v. Jancom Environmental Corporation, 425 Phil. 961, 981-82 (2002).

53 Rollo, p. 318.

54 Doliente v. Blanco, 87 Phil 670, 674 (1950) (citation omitted).

55 Bank of the Philippine Islands v. Green, 48 Phil 284, 288 (1925).

56 Rollo, p. 202.

57 Id. at 44.

58 Rollo, p. 17.

59 Vide: Luxuria Homes, Inc. v. Court of Appeals (361 Phil. 989, 1004 [1999]) where this Court found: "Although it appears that there was an agreement for the development of the area, there is no showing

that the same was ever perfected and finalized. Private respondents presented in evidence only drafts of a proposed management contract with petitioner’s handwritten marginal notes but the management

contract was not put in its final form. The reason why there was no final uncorrected draft was because the parties could not agree on the stipulations of said contract x x x. As a consequence the management

drafts submitted by the private respondents should at best be considered as mere unaccepted offers;" and Riker v. Ople (G.R. No. L-50492, October 27, 1987, 155 SCRA 85, 94) where this Court held: "Of

prime importance is the fact that the proposed x x x contract, not having been signed by private respondent, lacks consent which is the first essential requisite of every contract (Art. 1319, Civil Code)."

60 Rollo, p. 358.

61 Swedish Match, AB v. Court of Appeals, G.R. No. 128120, October 20, 2004, 441 SCRA 1, 18 (citation omitted), Insular Life Assurance Company, Ltd. v. Asset Builders Corporation, G.R. No.

147410, February 5, 2004, 422 SCRA 148, 159-160 (citations omitted).

62 Firme v. Bukal Enterprises and Development Corporation, G.R. No. 146608, October 23, 2003, 414 SCRA 190, 206 (citation omitted), Salonga v. Farrales, 192 Phil. 614, 622-623 (1981).

63 IV A. Tolentino, commentaries and jurisprudence on the civil code of the philippines, 447 (1997 ed.).

64 Ibid.

65 Rollo, pp. 108-109.

66 CA rollo, pp. 102-103.

67 Id. at 103.

68 Id. at 263-266.

69 Id. at 263-265.

70 Weldon Construction Corporation v. Court of Appeals, G.R. No. L-35721, October 12, 1987, 154 SCRA 618, 628 (citation omitted).

71 Mendoza v. Court of Appeals, 412 Phil. 14, 28 (2001) (citation omitted).

72 Luxuria Homes, Inc. v. Court of Appeals, supra note 59 at 1005.

73 Metropolitan Manila Development Authority v. Jancom Environmental Corporation, supra note 52 at 981.

74 Rollo, p. 22.

75 Pioneer Insurance & Surety Corporation v. De Dios Transportation Co., Inc., 454 Phil. 409, 427 (2003) (citation omitted), Santana-Cruz v. Court of Appeals, 414 Phil. 47, 61 (2001) (citations

omitted), Bernardo v. Court of Appeals, 341 Phil. 413, 425-6 (1997) (citations omitted), Nacuray v. NLRC, 336 Phil. 749, 754-5 (1997) (citation omitted), Rinconada Telephone Company, Inc. v.

Buenviaje, G.R. No. 49241-42, April 27, 1990, 184 SCRA 701, 754-755, Sumadchat v. Court of Appeals, 197 Phil. 465, 477 (1982).

76 Nacuray v. National Labor Relations Commission, supra note 75 at 755.

77 Santana-Cruz v. Court of Appeals, supra note 75 at 62 (citation omitted).EN BANC

 

DIEGO T. LIM,

                                     Petitioner,

 

 

 

 

 

G.R. No. 171952

 

 

Present:

 

PUNO, C.J.,QUISUMBING,

 

 

-versus-

 

 

 

 

 

 

 

COMMISSION ON ELECTIONS, HON. ELVIE P. LIM (Presiding Judge, Regional Trial Court, Branch I, Borongan, Eastern Samar), and FRANCISCO C. ADALIM,

                                   Respondents.

 

YNARES-SANTIAGO,

SANDOVAL-GUTIERREZ,

CARPIO,

AUSTRIA-MARTINEZ,

CORONA,

CARPIO MORALES,

    *CALLEJO, SR.,

AZCUNA,

TINGA,

CHICO-NAZARIO,

GARCIA,

VELASCO, JR., and

NACHURA, JJ.

 

 

Promulgated:

 

March 8, 2007

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

  

DECISION 

 

SANDOVAL-GUTIERREZ, J.:

 

 

          For our resolution is the instant Petition for Certiorari under Rule 64 of the 1997 Rules of Civil Procedure, as

amended, assailing the Resolution[1] dated March 8, 2006 rendered by the Commission on Elections

(COMELEC) En Banc in SPR No. 23-2005.

          Diego T. Lim, petitioner, and Francisco C. Adalim, private respondent, were candidates for mayor in

Taft, Eastern Samarduring the May 10, 2004 national and local elections.

          On May 12, 2004, the Municipal Board of Canvassers of Taft proclaimed petitioner as the duly elected mayor

with a lead of 45 votes.

          Private respondent then filed with the Regional Trial Court, Branch 1, Borongan, Eastern Samar, presided

by respondentJudge Elvie P. Lim, an election protest against petitioner, docketed as EPC No. 01-

2004.   Private respondent alleged that irregularities attended the canvassing of ballots in 35 precincts within the

municipality.

          Petitioner filed a motion to dismiss the election protest on the ground that private respondent failed to pay the

exact amount of docket and other legal fees prescribed by the COMELEC, but the motion was denied.   His motion

for reconsideration was likewise denied.

          Subsequently, petitioner filed with the COMELEC Second Division a petition for prohibition and injunction

praying that thetrial court be enjoined from hearing respondent’s election protest.   The petition was docketed as

SPR No. 50-2004.

          On February 9, 2005, the COMELEC Second Division issued a Resolution dismissing the petition for

prohibition and injunction.   Petitioner seasonably filed with the COMELEC En Banc a motion for reconsideration.  

          Meanwhile, upon private respondent’s motion, respondent Judge directed the parties to proceed with the

photocopying of contested ballots and to formally offer their evidence in writing on or before March 4, 2005.

          Subsequently, respondent Judge issued an Order setting on July 4, 2005 the promulgation of her Decision in

the election protest.   This prompted petitioner to file with the COMELEC En Banc an urgent motion for the

issuance of a status quo order.

          In an Order dated July 1, 2005, the COMELEC En Banc granted petitioner’s motion for reconsideration of the

Resolution of the COMELEC Second Division dismissing his petition for prohibition and injunction and directed the

trial court to defer any action on the pending election protest “until the case is finally resolved by this

Commission.”   However, on August 2, 2005, the COMELEC En Banc issued another Resolution, this time

denying petitioner’s motion for reconsideration of the Resolution of the COMELEC Second Division

dismissing his petition for prohibition and injunction.

          Three days thereafter, or on August 5, 2005, respondent Judge promulgated her Decision in the election

protest declaring private respondent the winning candidate in the May 10, 2004 mayoralty race in Taft, Eastern

Samar with a lead of 456 votes as against petitioner.    Thereupon, petitioner filed a notice of appeal.   

          For his part, private respondent filed a motion for execution pending appeal.   It was set for hearing on August

11, 2005.   An opposition thereto was filed by petitioner.

          On August 11, 2005, the trial court issued a Special Order granting private respondent’s motion for execution

pending appeal.  On the same date, the sheriff implemented the writ of execution.

          Immediately, petitioner filed with the COMELEC Second Division a Petition for Certiorari with prayer for a

Writ of Preliminary Injunction and Temporary Restraining Order or Status Quo Order, docketed as SPR No. 23-

2005, alleging that the trial court acted with grave abuse of discretion in granting private respondent’s motion for

execution pending appeal.

          The COMELEC Second Division, in a Resolution dated October 10, 2005, denied the petition for lack of

merit.

          Petitioner then filed with the COMELEC En Banc a motion for reconsideration, but it was denied in a

Resolution dated March 8, 2006.

          Petitioner, in his petition before us, contends that the trial court committed grave abuse of discretion when it

promulgated its Decision despite the Order of the COMELEC En Banc of July 1, 2005 directing the said trial

court to defer any action on the election protest “until the case is finally resolved by this Commission.”

Petitioner should have remembered that on August 2, 2005, the COMELEC En Banc issued a Resolution

denying his motion for reconsideration of the Resolution of its Second Division dismissing his petition for

prohibition and injunction.    Thus, this time, there was no more obstacle for the trial court to promulgate its

Decision since the COMELEC En Banc had denied his petition for prohibition and injunction.

          As to petitioner’s other contention that the trial court committed grave abuse of discretion by granting

private respondent’s motion for execution pending appeal, the same lacks merit. 

          Before granting an execution pending appeal in election cases, the following requisites must concur: (1) there

must be a motion by the prevailing party with notice to the adverse party; (2) there must be “good reasons” for the

execution pending appeal; and (3) the order granting execution pending appeal must state the good reasons.[2]

          In Fermo v. Comelec,[3] we held that the paramount consideration for a valid exercise of discretion to allow

execution pending appeal is the existence of good reasons which must be stated in a special order. The following

constitute good reasons and a combination of two or more of these will suffice to grant execution pending appeal:

(1) public interest involved or will of the electorate; (2) the shortness of the remaining term of the contested office;

and (3) the length of time that the election contest has been pending. 

          As correctly found by the trial court, the grant of the execution pending appeal is justified considering the

presence of these good reasons: the public interest or will of the electorate, as well as the shortness of the remaining

term of the contested office, thus:

Examination of the motion for execution pending appeal with the opposition thereto, indeed reveals that the motion for execution pending appeal is with merit. There being, therefore, good reasons to grant the same, taking into consideration that this involves public interest which will be better served and it would give meaning to the electoral will in Taft, Eastern Samar, if their chosen Mayor, the protestant herein, should immediately sit as Mayor and govern them, as the one being found to be the true winner in the mayoralty race for Taft, Eastern Samar and should have been sitting as such from July 1, 2004 to the present but was not able to sit; that as of today, more than one-third of the very short term of office of three (3) years has already expired or lapsed (as

of today, barely two (2) months is left on the tenure of the Mayor of Taft, Eastern Samar); and, further, depriving the herein protestant the assumption of the duties and functions of the Office of the Mayor of Taft, Eastern Samar will only resurrect the evils that the Court has long sought to contain, the “grab-the-proclamation-prolong-the-protest” technique, which route herein protestee is now taking.[4]

 

          In fine, the COMELEC acted within the confines of its authority in issuing the assailed Resolution.

          WHEREFORE, we DENY the instant petition. Costs against petitioner.

          SO ORDERED.

 

   ANGELINA SANDOVAL-GUTIERREZ

                     Associate Justice

 

 

WE CONCUR:

 

 

 

REYNATO S. PUNO

Chief Justice

 

 

 

LEONARDO A. QUISUMBING

Associate Justice

 

CONSUELO YNARES-SANTIAGO

Associate Justice

 

 

 

ANTONIO T. CARPIO

Associate Justice

 

 

 

RENATO C. CORONA

Associate Justice

 

 

(On sick leave)

ROMEO J. CALLEJO, SR.

Associate Justice

 

 

 

DANTE O. TINGA

Associate Justice

 

 

 

CANCIO C. GARCIA

Associate Justice

 

 

 

 

 

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice

 

 

 

CONCHITA CARPIO MORALES

Associate Justice

 

 

 

ADOLFO S. AZCUNA

Associate Justice

 

 

 

MINITA V. CHICO-NAZARIO

Associate Justice

 

 

 

PRESBITERO J. VELASCO, JR.

 Associate Justice

 

(No part)

ANTONIO EDUARDO B. NACHURA

Associate Justice

  

 

 

CERTIFICATION 

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court. 

                                     

         

                                                       REYNATO S. PUNO

                                                                     Chief Justice

*      On sick leave.[1]       Annex “A” of the petition, Rollo, pp. 30-33.[2]       Alvarez v. Comelec, G.R. No. 142527, March 1, 2001, 353 SCRA 434, 438.[3]       G.R. No. 140179, March 13, 2000, 328 SCRA 52, 57.[4]       Annex “L” of the petition, Rollo, p. 214.

THIRD DIVISION 

[G.R. No. 157206, June 27, 2008] 

LAND BANK OF THE PHILIPPINES PETITIONER, VS. SPOUSES PLACIDO ORILLA AND CLARA DY ORILLA, RESPONDENTS.

D E C I S I O N 

NACHURA, J.:

"Without doubt, justice is the supreme need of man. Man can endure without food for days, but if he is deprived even with the least injustice, he can be that violent to give up his life for it. History will tell us that many great nations had emerged in the past, yet they succumbed to downfall when their leaders had gone so immorally low that they could not anymore render justice to their people. In our times, we are witnesses to radical changes in our society rooted on alleged injustice. The only hope is in the courts as the last bulwark of democracy being the administrator of justice and the legitimate recourse of their grievances."[1]

The Facts

This is an appeal via a petition[2] for review on certiorari under Rule 45 of the Rules of Court of the Decision[3] of the Court of Appeals dated July 29, 2002 in CA-G.R. SP No. 63691 entitled "Land Bank of the Philippines v. Hon. Venancio J. Amila, in his capacity as Presiding Judge, Regional Trial Court, Branch 3, Tagbilaran City, Spouses Placido Orilla and Clara Dy Orilla." Said Decision affirmed the Order[4] dated December 21, 2000 of the Regional Trial Court (RTC), Branch 3, Tagbilaran City, sitting as a Special Agrarian Court (SAC) in Civil Case No. 6085.

Spouses Placido and Clara Orilla (respondents) were the owners of Lot No. 1, 11-12706, situated in Bohol, containing an area of 23.3416 hectares and covered by Transfer Certificate of Title No. 18401. In the latter part of November 1996, the Department of Agrarian Reform Provincial Agrarian Reform Office (DAR-PARO) of Bohol sent respondents a Notice of Land Valuation and Acquisition dated November 15, 1996 informing them of the compulsory acquisition of 21.1289 hectares of their landholdings pursuant to the Comprehensive Agrarian Reform Law (Republic Act [RA] 6657) for P371,154.99 as compensation based on the valuation made by the Land Bank of the Philippines (petitioner).

Respondents rejected the said valuation. Consequently, the Provincial Department of Agrarian Reform Adjudication Board (Provincial DARAB) conducted a summary hearing on the amount of just compensation. Thereafter, the Provincial DARAB affirmed the valuation made by the petitioner.

Unsatisfied, respondents filed an action for the determination of just compensation before the Regional Trial Court (as a Special Agrarian Court [SAC]) of Tagbilaran City. The case was docketed as Civil Case No. 6085 and was raffled to Branch 3.

After trial on the merits, the SAC rendered a Decision[5] dated November 20, 2000, the dispositive portion of which reads -WHEREFORE, judgment is hereby rendered fixing the just compensation of the land of petitioner subject matter of the instant action at P7.00 per square meter, as only prayed for, which shall earn legal interest from the filing of the complaint until the same shall have been fully paid. Furthermore, respondents are hereby ordered to jointly and solidarily indemnify the petitioners their expenses for attorney's fee and contract fee in the conduct of the appraisal of the land by a duly licensed real estate appraiser Angelo G. Fajardo of which petitioner shall submit a bill of costs therefor for the approval of the Court.

SO ORDERED.[6]

On December 11, 2000, petitioner filed a Notice of Appeal.[7] Subsequently, on December 15, 2000, respondents filed a Motion for Execution Pending Appeal[8]pursuant to Section 2, Rule 39 of the 1997 Rules of Civil Procedure and the consolidated cases of "Landbank of the Philippines v. Court of Appeals, et al."[9] and"Department of Agrarian Reform v. Court of Appeals, et al."[10] Respondents claimed that the total amount of P1,479,023.00 (equivalent to P7.00 per square meter for 21.1289 hectares), adjudged by the SAC as just compensation, could then be withdrawn under the authority of the aforementioned case.

Meanwhile, on December 18, 2000, the DAR filed its own Notice of Appeal[11] from the SAC Decision dated November 20, 2000. The DAR alleged in its Notice that it received a copy of the SAC Decision only on December 6, 2000.

On December 21, 2000, the SAC issued an Order[12] granting the Motion for Execution Pending Appeal, the decretal portion of which reads -WHEREFORE, the herein motion is granted and the petitioners are hereby ordered to post bond equivalent to one-half of the amount due them by virtue of the decision in this case. The respondent Land Bank of the Philippines, is therefore, ordered to immediately deposit with any accessible bank, as may be designated by respondent DAR, in cash or in any governmental financial instrument the total amount due the petitioner-spouses as may be computed within the parameters of Sec. 18(1) of RA 6657. Furthermore, pursuant to the Supreme Court decisions in "Landbank of the Philippines vs. Court of Appeals, et al." G.R. No. 118712, promulgated on October 6, 1995 and

"Department of Agrarian Reform vs. Court of Appeals, et al.," G.R. No. 118745, promulgated on October 6, 1995, the petitioners may withdraw the same for their use and benefit consequent to their right of ownership thereof.[13]

On December 25, 2000, respondents filed a Motion for Partial Reconsideration[14] of the amount of the bond to be posted, which was later denied in an Order[15] dated January 11, 2001.

Petitioner filed a Motion for Reconsideration[16] on December 27, 2000, which was likewise denied in an Order[17] dated December 29, 2000.

On March 13, 2001, petitioner filed with the Court of Appeals a special civil action[18]for certiorari and prohibition under Rule 65 of the Rules of Court with prayer for issuance of a temporary restraining order and/or preliminary injunction. It questioned the propriety of the SAC Order granting the execution pending appeal. Respondents and the presiding judge of the SAC, as nominal party, filed their respective comments[19] on the petition.

In its Decision dated July 29, 2002, the Court of Appeals dismissed the petition on the ground that the assailed SAC Order dated December 21, 2000 granting execution pending appeal was consistent with justice, fairness, and equity, as respondents had been deprived of the use and possession of their property pursuant to RA 6657 and are entitled to be immediately compensated with the amount as determined by the SAC under the principle of "prompt payment" of just compensation.

Petitioner filed a Motion for Reconsideration of the Court of Appeals Decision, but the same was denied in a Resolution dated February 5, 2003. Hence, this appeal.

Petitioner anchors its petition on the following grounds:

I. THE COURT OF APPEALS GRAVELY ERRED IN RULING THAT THE RESPONDENTS WERE ENTITLED TO EXECUTION PENDING APPEAL OF THE COMPENSATION FIXED BY THE SAC BASED ON THE PRINCIPLE OF PROMPT PAYMENT OF JUST COMPENSATION, EVEN THOUGH THE PRINCIPLE OF PROMPT PAYMENT IS SATISFIED BY THE PAYMENT AND IMMEDIATE RELEASE OF THE PROVISIONAL COMPENSATION UNDER SECTION 16(E) OF RA 6657, UPON SUBMISSION OF THE LEGAL REQUIREMENTS, IN ACCORDANCE WITH THE RULING OF THIS HONORABLE COURT IN THE CASE OF "LAND BANK OF THE PHILIPPINES V. COURT OF APPEALS, PEDRO L. YAP, ET AL.," G.R. NO. 118712, OCTOBER 6, 1995 AND JULY 5, 1996, AND NOT BY EXECUTION PENDING APPEAL OF THE COMPENSATION FIXED BY THE SAC.

II. THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION IN UPHOLDING THE SAC ORDER FOR EXECUTION PENDING APPEAL WHICH WAS ISSUED WITHOUT ANY GOOD REASON RECOGNIZED UNDER EXISTING JURISPRUDENCE AND PROPER HEARING AND RECEPTION OF EVIDENCE IN VIOLATION OF SECTION 2(A), RULE 39 OF THE RULES OF COURT.

For its first ground, petitioner asserts that, according to our ruling in Land Bank of the Philippines v. Court of Appeals,[20] the principle of "prompt payment" of just compensation is already satisfied by the concurrence of two (2) conditions: (a) the deposits made by petitioner in any accessible bank, equivalent to the DAR/LBP valuation of the expropriated property as provisional compensation, must be in cash and bonds as expressly provided for by Section 16(e) of RA 6657, not merely earmarked or reserved in trust; and (b) the deposits must be immediately released to the landowner upon compliance with the legal requirements under Section 16[21] of RA 6657, even pending the final judicial determination of just compensation.

Anent the second ground, petitioner argues that the good reasons cited by the SAC, as affirmed by the Court of Appeals, namely: "(1) that execution pending appeal would be in consonance with justice, fairness, and equity considering that the land had long been taken by the DAR; (2) that suspending the payment of compensation will prolong the agony that respondents have been suffering by reason of the deprivation of their property; and (3) that it would be good and helpful to the economy" are not valid reasons to justify the execution pending appeal, especially

because the execution was granted without a hearing.

This appeal should be denied.

As the issues raised are interrelated, they shall be discussed jointly.

Execution of a judgment pending appeal is governed by Section 2(a) of Rule 39 of the Rules of Court, to wit:SEC. 2. Discretionary execution. -

(a) Execution of a judgment or a final order pending appeal. -- On motion of the prevailing party with notice to the adverse party filed in the trial court while it has jurisdiction over the case and is in possession of either the original record or the record on appeal, as the case may be, at the time of the filing of such motion, said court may, in its discretion, order execution of a judgment or final order even before the expiration of the period to appeal.

x x x x

Discretionary execution may only issue upon good reasons to be stated in a special order after due hearing.As provided above, execution of the judgment or final order pending appeal is discretionary. As an exception to the rule that only a final judgment may be executed, it must be strictly construed. Thus, execution pending appeal should not be granted routinely but only in extraordinary circumstances.

The Rules of Court does not enumerate the circumstances which would justify the execution of the judgment or decision pending appeal. However, we have held that "good reasons" consist of compelling or superior circumstances demanding urgency which will outweigh the injury or damages suffered should the losing party secure a reversal of the judgment or final order. The existence of good reasons is what confers discretionary power on a court to issue a writ of execution pending appeal. These reasons must be stated in the order granting the same. Unless they are divulged, it would be difficult to determine whether judicial discretion has been properly exercised.[22]

In this case, do good reasons exist to justify the grant by the SAC of the motion for execution pending appeal? The answer is a resounding YES.

The expropriation of private property under RA 6657 is a revolutionary kind of expropriation,[23] being a means to obtain social justice by distributing land to the farmers, envisioning freedom from the bondage to the land they actually till. As an exercise of police power, it puts the landowner, not the government, in a situation where the odds are practically against him. He cannot resist it. His only consolation is that he can negotiate for the amount of compensation to be paid for the property taken by the government. As expected, the landowner will exercise this right to the hilt, subject to the limitation that he can only be entitled to "just compensation." Clearly therefore, by rejecting and disputing the valuation of the DAR, the landowner is merely exercising his right to seek just compensation.[24]

In this case, petitioner valued the property of respondents at P371,154.99 for the compulsory acquisition of 21.1289 hectares of their landholdings. This amount respondents rejected. However, the same amount was affirmed by the DAR after the conduct of summary proceedings. Consequently, respondents brought the matter to the SAC for the determination of just compensation. After presentation of evidence from both parties, the SAC found the valuation of the LBP and the DAR too low and pegged the "just compensation" due the respondents at P7.00 per square meter, or a total of P1,479,023.00 for the 21.1289 hectares. In determining such value, the SAC noted the following circumstances:

1. the nearest point of the land is about 1.5 kilometers from Poblacion Ubay;

2. the total area of the land based on the sketch-map presented by the MARO is 23.3416 hectares.

3. the land is generally plain, sandy loam, without stones, rocks or [pebbles];

4. the land is adjoining the National Highway of Ubay-Trinidad, Bohol;

5. 11.4928 hectares of the land is devoted to planting rice, which portion is rain-fed and produces 60-80 cavans of rice per hectare with two (2) harvest seasons a year;

6. four (4) hectares is planted with 210 fruit-bearing coconut trees, which private respondents used to receive a share of P1,500.00 per harvest four (4) times a year;

7. five (5) hectares is cogonal but now most area is planted with cassava;

8. the area is traversed with electricity providing electric power to some occupants;

9. across the National Highway, about 200 meters away from the landholding, is an irrigation canal of the National Irrigation Administration (NIA);

10. the Ubay Airport is about two (2) kilometers from the landholding;

11. fruit trees like mangoes and jackfruits were also planted on the property;

12. north of the landholding, about a kilometer away, is the seashore;

13. the market value of the land per Tax Declaration No. 45-002-00084 is P621,310.00 for the entire 23.2416 hectares but representing only 48% of the actual value of the property;

14. that the real estate appraiser Angelo Z. Fajardo appraised the land at P80,000.00 per hectare for the Riceland and P30,000.00 for all other portions thereof;

15. testimony of the representative from petitioner that the factors considered in the appraisal of land are the cost of acquisition of the land, the current value, its nature, its actual use and income, the sworn valuation of the owner, and the assessment by the government functionary concerned;

16. petitioner's contention that the main basis for the valuation it made was the very low price that the petitioners had paid for the land when they acquired it along with other parcels from the Development Bank of the Philippines in a foreclosure sale;

17. the testimony of the Municipal Agrarian Reform Officer for DAR that it was contemplated that the property be disposed to farmer-beneficiaries at a relatively higher price; and

18. the fact that Ubay town is a fast-growing municipality being a consistent recipient of government projects and facilities in view of its natural resources and favorable geographical location--Bohol Circumferential Road Improvement Project Phase I, the Leyte-Bohol Interconnection Project Phase I, the Ilaya Reservior Irrigation Project, the Metro San Pascual Rural and Waterworks System, the 250-hectare Central Visayas Coconut Seeds Production Center, the Philippine Carabao Center at the Ubay Stock Farm, and several other public and private business facilities.[25]

In light of these circumstances, the SAC found that the valuation made by petitioner, and affirmed by the DAR, was unjustly way below the fair valuation of the landholding at the time of its taking by the DAR. The SAC, mindful also of the advanced age of respondents at the time of the presentation of evidence for the determination of just compensation, deemed it proper to grant their motion for execution pending appeal with the objective of ensuring "prompt payment" of just compensation.

Contrary to the view of petitioner, "prompt payment" of just compensation is not satisfied by the mere deposit with any accessible bank of the provisional compensation determined by it or by the DAR, and its subsequent release to the landowner after compliance with the legal requirements set by RA 6657.

Constitutionally, "just compensation" is the sum equivalent to the market value of the property, broadly described as

the price fixed by the seller in open market in the usual and ordinary course of legal action and competition, or the fair value of the property as between the one who receives and the one who desires to sell, it being fixed at the time of the actual taking by the government.[26] Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. It has been repeatedly stressed by this Court that the true measure is not the taker's gain but the owner's loss. The word "just" is used to modify the meaning of the word "compensation" to convey the idea that the equivalent to be given for the property to be taken shall be real, substantial, full, and ample.[27]

The concept of just compensation embraces not only the correct determination of the amount to be paid to the owners of the land, but also payment within a reasonable time from its taking. Without prompt payment, compensation cannot be considered "just" inasmuch as the property owner is made to suffer the consequences of being immediately deprived of his land while being made to wait for a decade or more before actually receiving the amount necessary to cope with his loss.[28]

Put differently, while prompt payment of just compensation requires the immediate deposit and release to the landowner of the provisional compensation as determined by the DAR, it does not end there. Verily, it also encompasses the payment in full of the just compensation to the landholders as finally determined by the courts. Thus, it cannot be said that there is already prompt payment of just compensation when there is only a partial payment thereof, as in this case.

While this decision does not finally resolve the propriety of the determination of just compensation by the SAC in view of the separate appeal on the matter, we find no grave abuse of discretion on the part of the SAC judge in allowing execution pending appeal. The good reasons cited by the SAC--that it would be in consonance with justice, fairness, and equity, and that suspending payment will prolong the agony of respondents suffered due to the deprivation of their land--are eloquently elucidated in the Comment filed by SAC Judge Venancio J. Amila, as nominal party, on the petition for certiorari and prohibition of petitioner before the Court of Appeals, viz.:In addition to the Comment of private respondents, through counsel Hilario C. Baril, which the undersigned has just received a copy today, it is well to state here that respondent Placido Orilla is already an old man just as his wife. The appealed Decision will show that Orilla was already 71 years old at the time he testified in this case and the transcripts would further show that the money that he used in buying the DBP foreclosed property herein subject of compulsory acquisition by the DAR came from his retirement benefits evidently thinking that his investment would afford him security and contentment in his old age. But, luckily or unluckily, the land was taken from him by the DAR at a price so low that he could not swallow, thus, he brought the issue to court. Yet, all along, the land has been under the enjoyment of farmer-beneficiaries without him yet being paid therefor. In the mind of the Court, if payment for the land would be delayed further, it would not be long that death would overtake him. What a misfortune to his long years of service to acquire that hard-earned savings only to be deprived therefrom at the time when he needed it most.[29]

The SAC, aware of the protracted proceedings of the appeal of its November 20, 2000 Decision, but without imputing any dilatory tactics on the part of petitioner, thus deemed it proper, in its sound discretion, to grant the execution pending appeal. Moreover, the execution of the judgment of the SAC was conditioned on the posting of a bond by the respondents, despite pleas to reduce the same, in the amount of one-half of the just compensation determined by the said court or P739,511.50.

To reiterate, good reasons for execution pending appeal consist of compelling or superior circumstances demanding urgency which will outweigh the injury or damages suffered should the losing party secure a reversal of the judgment or final order. In the case at bar, even with the procedural flaw in the SAC's grant of execution without a hearing, the injury that may be suffered by respondents if execution pending appeal is denied indeed outweighs the damage that may be suffered by petitioner in the grant thereof. As correctly pointed out by respondents, the reversal of the November 20, 2000 SAC Decision, in the sense that petitioner will pay nothing at all to respondents, is an impossibility, considering the constitutional mandate that just compensation be paid for expropriated property. The posting of the required bond, to our mind, adequately insulates the petitioner against any injury it may suffer if the SAC determination of just compensation is reduced.

Suffice it to say that, given the particular circumstances of this case, along with the considerable bond posted by

respondents, the assailed SAC Order of December 21, 2000 and the Decision of the Court of Appeals dated July 29, 2002 are justified.

WHEREFORE, the Decision of the Court of Appeals dated July 29, 2002 is AFFIRMED.

SO ORDERED.

Ynares-Santiago, (Chairperson), Austria-Martinez, Chico-Nazario, and Reyes, JJ.,concur.

[1] Comment of Hon. Venancio J. Amila, Presiding Judge of RTC, Branch 3, Tagbilaran City, as nominal party on the petition for certiorari and prohibition of Land Bank of the Philippines before the Court of Appeals; rollo, pp. 117-118.

[2] Rollo, pp. 21-54.

[3] Id. at 55-62.

[4] Id. at 101.

[5] Id. at 85-90.

[6] Id. at 90.

[7] Id. at 91-92.

[8] Id. at 94-98.

[9] 327 Phil. 1047 (1996).

[10] 319 Phil. 246 (1995).

[11] Id. at 99-100.

[12] Id. at 101.

[13] Id.

[14] Id. at 102-105.

[15] Id. at 110.

[16] Id. at 106-107.

[17] Id. at 108-109.

[18] Id. at 64-84.

[19] Id. at 111-116, 117-118, respectively.

[20] Supra note 9.

[21] SEC. 16. Procedure for Acquisition of Private Lands - For purposes of acquisition of private lands, the following procedures shall be followed:(a) After having identified the land, the landowners and the beneficiaries, the DAR shall send its notice to

acquire the land to the owners thereof, by personal delivery or registered mail, and post the same in a conspicuous place in the municipal building and barangay hall of the place where the property is located. Said notice shall contain the offer of the DAR to pay a corresponding value in accordance with the valuation set forth in Sections 17, 18, and other pertinent provisions hereof.

(b) Within thirty (30) days from the date of receipt of written notice by personal delivery or registered mail, the landowners, his administrator or representative shall inform the DAR of his acceptance or rejection of the offer.

(c) If the landowner accepts the offer of the DAR, the LBP shall pay the landowner the purchase price of the land within thirty (30) days after he executes and delivers a deed of transfer in favor of the Government and surrenders the Certificate of Title and other muniments of title.

(d) In case of rejection or failure to reply, the DAR shall conduct summary administrative proceedings to determine the compensation for the land by requiring the landowner, the LBP and other interested parties to submit evidence as to the just compensation for the land, within fifteen (15) days from the receipt of the notice. After the expiration of the above period, the matter is deemed submitted for decision. The DAR shall decide the case within thirty (30) days after it is submitted for decision.

(e) Upon receipt by the landowner of the corresponding payment or in case of rejection or no response from the landowner, upon the deposit with an accessible bank designated by the DAR of the compensation in case or in LBP bonds in accordance with this Act, the DAR shall take immediate possession of the land and shall request the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. The DAR shall thereafter proceed with the redistribution of the land to qualified beneficiaries.

(f) Any party who disagrees with the decision may bring the matter to the court of proper jurisdiction for final determination of just compensation.

[22] Heirs of Macabangkit Sangkay v. National Power Corporation, G.R. No. 141447, May 4, 2006, 489 SCRA 401, 417.

[23] Confederation of Sugar Producers Association, Inc. v. Department of Agrarian Reform (DAR), G.R. No. 169514, March 30, 2007, 519 SCRA 582, 636; Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian Reform, G.R. Nos. 78742, 79310, 79744, 79777, July 14, 1989, 175 SCRA 343, 386.

[24] Land Bank of the Philippines v. Court of Appeals, supra note 20, at 1053-1054.

[25] Summary of circumstances per documentary and testimonial evidence presented by both parties; RTC Decision dated November 20, 2000; rollo, pp. 86-87.

[26] Apo Fruits Corporation v. Court of Appeals, G.R. No. 164195, December 19, 2007, 541 SCRA 117, 142.

[27] Apo Fruits Corporation v. Court of Appeals, G.R. No. 164195, February 6, 2007, 514 SCRA 537, 558.

[28] Id. at 557-558; Land Bank of the Philippines v. Court of Appeals, supra note 20.

[29] Rollo, p. 119.Republic of the Philippines

SUPREME COURTManila

FIRST DIVISION

G.R. No. 149053             March 7, 2007

CENTRAL SURETY AND INSURANCE COMPANY, Petitioner, vs.PLANTERS PRODUCTS, INC., Respondent.

D E C I S I O N

CORONA, J.:

This appeal on certiorari under Rule 45 of the Rules of Court hinges on a pure question of law, that is, whether execution of judgment can be ordered by mere motion despite the lapse of five years from entry of judgment.

The antecedent facts follow.

Sometime in 1977, Ernesto Olson entered into a dealership agreement with respondent Planters Products, Inc. whereby he agreed to purchase, in cash or credit, fertilizers and agricultural chemicals from respondent for resale. To secure Olson’s faithful compliance of his obligations, Vista Surety and Insurance, Co. (Vista Insurance) and petitioner executed a surety undertaking in favor of respondent.

After several deliveries, Olson failed to pay respondent prompting the latter to claim the amount due from petitioner and Vista Insurance. However, both refused to settle their liabilities to respondent as Olson’s sureties.

On June 25, 1979, respondent filed an action for collection of sum of money1 against Olson, Vista Insurance and petitioner in the Regional Trial Court (RTC) of Makati, Branch 58. Summons were accordingly served (except as to Olson whose address could not be located).

In a decision2 dated November 6, 1991, the trial court found petitioner and Vista Insurance liable to respondent. They were ordered to pay the following: (1) P372,502 representing the unpaid principal amount plus interest; (2) 25% of the total amount recoverable as attorney’s fees and (3) cost of suit.

Petitioner alone appealed to the Court of Appeals (CA). On December 7, 1992, the CA dismissed petitioner’s appeal for failure to pay the required docket fees.3 On March 12, 1993, the dismissal of petitioner’s appeal became final and executory; entry of judgment followed on May 27, 1993.4

On October 12, 1993, respondent filed in the RTC a motion for execution of judgment following the CA’s dismissal of petitioner’s appeal.5The RTC issued the writ on October 21, 1993.6 The writ, however, was not implemented so respondent filed an ex parte motion for the issuance of an alias writ of execution which the trial court granted on February 24, 1994.

In the CA, petitioner filed a "Very Urgent Motion to Set Aside the CA Resolution of December 7, 1992 and to Re-Open Appeal with Prayer for Preliminary Injunction/Temporary Restraining Order."7 On March 3, 1994, the appellate court issued a resolution restraining the RTC judge and the deputy sheriff from enforcing the writ but, on motion of respondent, the CA lifted the TRO and dismissed petitioner’s urgent motion on March 24, 1994.8

Through a petition for certiorari under Rule 65 of the Rules of Court, petitioner elevated the CA’s dismissal of its urgent motion to this Court. In its petition, petitioner argued that it failed to pay the docket fees only because the CA’s judicial records division did not "re-send" the notice for it to pay said fees. On July 11, 1994, we dismissed the petition9 and this dismissal became final on September 14, 1994.10

On June 18, 1999 or 6 years from the entry of judgment of the RTC’s decision,11 respondent filed another motion for issuance of alias writ of execution in the trial court.12 On August 20, 1999, the trial court issued an order granting the writ. Petitioner filed an MR of said order but the RTC denied it.

Petitioner thereafter went to the CA via a special civil action for certiorari under Rule 65 of the Rules ascribing grave abuse of discretion on the part of the RTC judge for issuing the writ despite the fact that more than five years had elapsed since the RTC’s decision of November 6, 1991 became final and executory. Invoking Rule 39, Section 6 of the Rules, petitioner insisted that the RTC decision could no longer be enforced by mere motion but only by court action.

The CA dismissed the petition for patent lack of merit.13 It held that:

While it is true that the judgment sought to be executed became final and executory on March 12, 1993, it bears stressing that the delay was caused by petitioner’s dilatory maneuvers filed in this Court and all the way to the Supreme Court, viz: the Very Urgent Motion to Set Aside Resolution of December 7, 1992 and to Re-Open the Appeal with Prayer for Preliminary Injunction/Temporary Restraining Order which resulted in the issuance of the Court of Appeals Resolution dated March 3, 1994 enjoining respondents from enforcing the subject decision; the Motion for Reconsideration of [the] Court of Appeals Resolution dated March 24, 1994; and Petition for Certiorari before the Supreme Court which was ultimately dismissed by the High Court on July 11, 1994.

xxx xxx xxx

WHEREFORE, for patent lack of merit, the petition is DISMISSED pursuant to Rule 65, [S]ec. 8[,] 2nd par.[,] Rules of Civil Procedure.

Petitioner filed an MR but this was likewise denied by the CA.14 Hence, this petition.

The only relevant issue for our resolution is whether the execution of a final judgment may be made by mere motion despite the lapse of five years.

In this case, we answer in the affirmative.

Under Rule 39, Section 6,15 the rule is that a final judgment may be executed by mere motion within five years from the date of entry of judgment. However, the rule is not absolute and admits one notable exception and that is when the delay in enforcing the judgment is caused by the party assailing the filing of the motion.

In Republic v. Court of Appeals,16 we declared that, on meritorious grounds, execution of final judgment by mere motion may be allowed even after the lapse of five years when delay in the execution is caused or occasioned by the actions of the judgment debtor and/or is incurred for his benefit.

Similarly, in Camacho v. Court of Appeals,17 we ruled that the five-year period allowed for enforcement of judgment by mere action is deemed effectively interrupted or suspended when the delay in the execution is occasioned by the oppositor’s own initiatives in order to gain an undue advantage.

Based on the attendant facts, the present case falls within the exception. Petitioner triggered the series of delays in the execution of the RTC’s final decision by filing numerous motions and appeals in the appellate courts, even causing the CA’s issuance of the TRO enjoining the enforcement of said decision. It cannot now debunk the filing of the motion just so it can delay once more the payment of its obligation to respondent. It is obvious that petitioner is merely resorting to dilatory maneuvers to skirt its legal obligation.

Lastly, in Republic and Camacho, we ruled that the purpose of the law in prescribing time limitations for enforcing a judgment or action is to prevent a party from sleeping on his rights. Far from sleeping on its rights, respondent pursued its claim by persistently seeking the execution of the RTC’s final judgment of November 6, 1991. It would be unjust to frustrate respondent’s effort to collect payment from petitioner on sheer technicality. While strict compliance to the rules of procedure is desired, liberal interpretation is warranted in cases where a strict enforcement of the rules will not serve the ends of justice.

WHEREFORE, the petition is hereby DENIED.

Triple costs against petitioner whose counsel is hereby warned of severe disciplinary sanctions for any further attempt to delay the final disposition of this case.

SO ORDERED.

RENATO C. CORONAAssociate Justice

WE CONCUR:

REYNATO S. PUNOChief JusticeChairperson

ANGELINA SANDOVAL-GUTIERREZAssociate Justice

ADOLFO S. AZCUNAAsscociate Justice

CANCIO C. GARCIAAssociate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

REYNATO S. PUNOChief Justice

Footnotes

1 Civil Case No. 2924, entitled Planters Products, Inc. v. Ernesto D. Olson, Vista Surety and Insurance Co., Inc. and/or Central Surety and Insurance Co., Inc.

2 Decided by Judge Zosimo C. Angeles, rollo, pp. 35-37.

3 CA Resolution, rollo, p. 39.

4 Id., p. 40.

5 Id., pp. 41-43.

6 Id., pp. 44-45.

7 Id., pp. 50-65.

8 Id., pp. 67-72.

9 SC Minute Resolution, rollo, pp. 128-129.

10 Rollo, p. 180.

11 See footnote 4. Entry of judgment was made on May 27, 1993.

12 Id., pp. 136-137.

13 Penned by Associate Justice Portia Alino-Hormachuelos and concurred in by Associate Justices Fermin A. Martin (retired) and Mercedes Gozo-Dadole (retired) of the Second Division of the Court of Appeals; rollo, pp. 22-25.

14 Id., p. 27.

15 SEC. 6. Execution by mere motion or by independent action. ― A final and executory judgment or order may be executed on motion within five (5) years from the date of its entry. After the lapse of such time, and before it is barred by the statute of limitations, a judgment may be enforced by action. The revived judgment may also be enforced by motion within five (5) years from the date of its entry and thereafter by action before it is barred by the statute of limitations.

16 329 Phil. 115 (1996).

17 351 Phil. 108 (1998).FIRST DIVISION 

[G.R. No. 158848, February 04, 2008] 

ESTEBAN YAU, PETITIONER, VS. RICARDO C. SILVERIO, SR., RESPONDENT.

[G.R. NO. 171994]ARTURO MACAPAGAL, PETITIONER, VS. HON. IRENEO LEE GAKO, JR., IN HIS CAPACITY AS PRESIDING JUDGE OF THE REGIONAL TRIAL COURT OF CEBU CITY, BRANCH 6,

ESTEBAN YAU AND DEPUTY SHERIFF RUBEN S. NEQUINTO, RESPONDENTS.

D E C I S I O N 

SANDOVAL-GUTIERREZ, J.:

Before this Court are two (2) consolidated petitions, the first, docketed as G.R. No. 158848, is a petition for review on certiorari[1] of the Decision[2] dated September 22, 1999 and Resolution dated June 20, 2003 of the Court of Appeals in CA-G.R. SP No. 72202; and the other, G.R. No. 171994, is likewise a petition for review

oncertiorari assailing the Decision[3] dated August 24, 2005 and Resolution dated March 15, 2006 of the Court of Appeals in CA-G.R. SP No. 60106.

The undisputed facts are:

On January 22, 1981, Esteban Yau bought from the Philippine Underwriters Finance Corporation (Philfinance) Promissory Note No. 3447 issued by the Philippine Shares Corporation (PSC). Yau paid the amount of P1,600,000 to Philfinance for the note. The latter promised to return to him on March 24, 1981 his investment plus earnings of P29,866.67. Philfinance then issued postdated checks to Yau drawn against the Insular Bank of Asia and America, all maturing on March 24, 1981, for P1,600,000.00, P24,177.78 and P5,688.89. But when the checks were deposited in the bank, they were dishonored for insufficiency of funds. When Yau complained to the PSC, it denied having issued the promissory note.

Thus, on March 28, 1984, Yau filed a complaint [4] with the Regional Trial Court (RTC), Branch 6, Cebu City, for recovery of the value of the promissory note and for damages against Philfinance and the members of its board of directors, among whom were Ricardo C. Silverio, Sr., Pablo C. Carlos, Jr., Arturo Macapagal, Florencio Biagan, Jr., and Miguel Angel Cano.

Except for defendant Pablo C. Carlos Jr., all the other defendants failed to file their answers seasonably. Hence, the trial court issued an Order declaring them in default and allowing Yau to present his evidence ex parte. Pablo Carlos, Jr., although present during the hearing, did not present evidence in his defense.

Meanwhile, after the trial court denied their motion for reconsideration, Silverio and his co-defendants (except Pablo Carlos, Jr.), filed with the Court of Appeals a petition for certiorari and prohibition (docketed as CA-G.R. SP No. 04835), assailing the Order of default. The appellate court, however, in its Decision dated March 10, 1986, dismissed the petition, holding that summonses were duly served and that defendants’ failure to answer the complaint justifies the trial court’s Order declaring them in default. Since they did not interpose an appeal, the Decision of the appellate court became final and executory on June 17, 1986. An entry of judgment was made on July 4, 1986.

On March 27, 1991, the trial court rendered its Decision in favor of Esteban Yau. The dispositive portion reads:WHEREFORE, judgment is rendered in favor of plaintiff and against defendants Philippine Underwriters Finance Corporation, Ricardo C. Silverio, Sr., Pablo C. Carlos,Jr., Arturo Macapagal, Florencio Biagan, Jr. and Miguel Angel Cano, ordering the latter, jointly and severally, to pay the former the following:

(a) The principal amount of One Million Six Hundred Thousand (P1,600,000) Pesos, representing the principal amount of the plaintiff’s investment;

(b) The amount of Ten Million Three Hundred Ninety Seven Thousand Four Hundred Ninety Four Pesos and 03/100 (P10,397,494.03), representing the earnings which the plaintiff could have made on his investment as of December 31, 1989 and thereafter, legal interest on the principal amount of P1,600,000, until fully paid;

(c) The amount of One Hundred Thousand (P100,000) Pesos as, and for moral damages;

(d) The amount of Fifty Thousand (P50,000) Pesos as, and for exemplary or corrective damages;

(e) The amount of One Hundred Thirty Seven Thousand Two Hundred Seven Pesos and 28/100 (P137,207.28) as attorney’s fees; Forty Four Thousand Eighteen Pesos and 33/100 (P44,018.33) as litigation expenses; and

(f) The costs of the suit.

The Counterclaims interposed by the defendant Pablo C. Carlos, Jr. in his Answer, aredismissed.

SO ORDERED.[5]

Pablo Carlos, Jr. and Philfinance interposed an appeal to the Court of Appeals, docketed therein as CA-G.R. CV No. 33496. With respect to Silverio, Macapagal, Biagan, and Cano, their Notice of Appeal was dismissed for their failure to pay the docket fees. The Order of dismissal became final and executory on December 26, 1991 and an entry of judgment was made on April 21, 1992.

On July 31, 1992, the trial court, upon petitioner Yau’s motion, issued an Order directing the execution of its Decision and, on September 17, 1992, issued the corresponding writ of execution.

In December 1992, the defendants’ bank deposits were garnished by the sheriff. Also, the shares of Silverio in the Manila Golf and Country Club were sold at public auction for P2,000,000. As the judgment was only partially satisfied, the writ of execution was enforced against the other defendants, including Macapagal.

Silverio and Macapagal took separate courses of action. On February 2, 1993, Macapagal filed with this Court a petition for certiorari and prohibition, questioning the validity of the Decision of the trial court, its Order of execution and the writ of execution. The petition, however, was referred to the Court of Appeals, where it was docketed as CA-G.R. SP No. 31075 and raffled off to the Fourteenth Division. Eventually, the appellate court dismissed the petition on the ground that the same was barred, under the principle of res judicata, by its previous Decision in CA-G.R. SP No. 04835, upholding the validity of the trial court’s Order of default.

On other hand, Silverio filed with the Court of Appeals (Special Eleventh Division) a petition for reinstatement of his appeal and annulment of the writ of execution, docketed as CA-G.R. CV No. 33496. However, the appellate court denied the petition on the ground that the Order of the RTC dismissing the Notice of Appeal had become final and executory.

Macapagal then filed with this Court a petition for review on certiorari, docketed as G.R. No. 110610. Silverio likewise filed with this Court a similar petition, docketed as G.R. No. 113851. These petitions were consolidated because they arose out of the same facts. In its Decision dated April 18, 1997, this Court upheld the rulings of the Court of Appeals and dismissed their petitions. Their motions for reconsideration were denied with finality by this Court in its Resolution[6] dated October 8, 1998.

Considering that the judgment was not fully satisfied, the sheriff resumed the implementation of the writ. In 1999, he sent notices of garnishment to several banks in Manila against any existing account of Macapagal. Thereupon, Macapagal filed with the trial court a motion to quash the writ of execution on the ground that its lifetime has expired, contending that the judgment in Civil Case No. CEB- 2058 became final and executory in 1992, hence, can be enforced only within five (5) years therefrom or until 1997. After five (5) years and within ten (10) years from the entry of judgment, it may be enforced only by an independent civil action.

On January 28, 2000, the trial court issued an Order denying Macapagal’s motion to quash the writ of execution. His motion for reconsideration was likewise denied in a Resolution dated May 22, 2000. The trial court held that there was an effective interruption or delay in the implementation of the writ of execution because he filed with the Court of Appeals and this Court various petitions.

Macapagal then filed with the Court of Appeals (Eighteenth Division) a petition forcertiorari, docketed as CA-G.R. SP No. 60106. However, the appellate court, in its Decision dated August 24, 2005, dismissed the petition and denied the motion for reconsideration in its Resolution dated September 15, 2005.

Hence, Macapagal filed with this Court the present petition, docketed as G.R. No. 171994.

Meanwhile, on October 31, 2000, the Court of Appeals rendered a Decision in CA-G.R. CV No. 33496 (appeal of defendants Philfinance and Pablo Carlos, Jr.). The dispositive portion reads:“IN VIEW OF ALL THE FOREGOING, the appealed decision as hereby modified in such a way that the award of lost income is deleted and the legal interest to be paid on the principal amount of P1,600,000 be computed from

the filing of the complaint at twelve (12%) percent until full payment thereof. On all other respect, the judgment stands. Costs against appellants.[7]

The aforesaid Decision became final and executory on March 21, 2001.

Sometime in 2001, the sheriff found that Silverio was a co-owner of three (3) houses located in Forbes Park and Bel-Air Village, Makati City, covered by TCT Nos. (147129)-137156, (436750)-137155 and (337033)-137154 of the Registry of Deeds, same city. Thus, on March 21, 2001, the sheriff served a Notice of Levy on a house and lot in Forbes Park. An auction sale was held on July 26, 2001 wherein Yau was declared the highest bidder, with a bid of P11,443,219.64 for the said house and lot covered by TCT No. (436750)-137155. On August 6, 2001, the sheriff issued the corresponding Certificate of Sale.

On December 7, 2001, Silverio filed with the trial court an omnibus motion praying that the levy on execution, the notice of auction sale and the certificate of sale be declared void. He contends that the writ of execution has become functus oficio since more than five (5) years have elapsed from the finality of the judgment sought to be executed.

The trial court, in its Order of March 20, 2002, denied the omnibus motion. The trial court also denied his motion for reconsideration in an Order dated June 21, 2002.

Undaunted, Silverio filed with the Court of Appeals (Twelfth Division) a petition forcertiorari, docketed as CA-G.R. SP No. 72202, challenging the said Orders of the trial court. On April 15, 2003, the appellate court rendered its Decision granting the petition, thus:WHEREFORE, premises considered, the petition is GRANTED, and the assailed Orders of public respondent judge are REVERSED and SET ASIDE. The levy by respondent sheriff upon TCT No. (-147129)-137156, TCT No. (-436750)137155, and TCT No. (-337033-)137154, as well as the subsequent auction sale and transfer of theproperty covered by TCT No. (436750) 137155, are declared NULL and VOID. Allannotations upon the titles to aforesaid properties pursuant to the levy are ordered cancelled. Costs against private respondent.

SO ORDERED.[8]

Yau’s motion for reconsideration was denied by the appellate court in its Resolution dated June 20, 2003.

Hence, Yau filed the instant petition for review on certiorari, docketed as G.R. No. 158848. In view of the identity of the parties and the issues in G.R. No. 158848 and G.R. No. 171994, we resolved to consolidate the two petitions.

The principal and common issue in both petitions is whether the Decision rendered by the RTC in Civil Case No. CEB-2058 may no longer be enforced against Silverio and Macapagal since more than five (5) years have already lapsed from its finality.

Significantly, the Court of Appeals rendered conflicting Decisions. In the petition forcertiorari (CA-G.R. SP No. 60106) filed by Macapagal assailing the trial court’s Orders denying his motion to quash the writ of execution, the appellate court denied his petition. It sustained the trial court’s ruling that its judgment may still be enforced despite the lapse of five years from the date it became final; and held that the delay in the implementation of the writ of execution was due to Macapagal’s filing with the Court of Appeals and this Court various petitions.

Relative to Silverio’s petition for certiorari (CA-G.R. SP No. 72202) questioning the trial court’s Orders denying his omnibus motion to declare void the levy on execution, the auction sale and the certificate of sale, the Court of Appeals granted his petition. The appellate court ruled that the writ had become functus oficio and could no longer be enforced since more than five years have elapsed from the finality of the trial court’s judgment.

Section 6, Rule 39 of the 1997 Rules of Civil Procedure, as amended provides:Section 6. Execution by motion or by independent action. â€“ A final and executory judgment or order may be executed on motion within five (5) years from the date of its entry. After the lapse of such time, and before it is barred by the statute of limitations, a judgment may be enforced by action. The revived judgment may also be

enforced by motion within five (5) years from the date of its entry and thereafter by action before it is barred by the statute of limitations.It is clear from the above Rule that a judgment may be executed on motion within five years from the date of its entry or from the date it becomes final and executory. Thereafter, before barred by the statute of limitations, by action. However, there are instances where this Court allowed execution by motion even after the lapse of five years upon meritorious grounds.

In Francisco Motors Corporation v. Court of Appeals,[9] this Court held that in computing the time limit for enforcing a final judgment, the general rule is that there should not be included the time when execution is stayed, either by agreement of the parties for a definite time, by injunction, by the taking of an appeal or writ of error so as to operate as a supersedeas, by the death of a party or otherwise. Any interruption or delay occasioned by the debtor will extend the time within which the writ may be issued without scire facias. Thus, the time during which execution is stayed should be excluded, and the said time will be extended by any delay occasioned by the debtor.

There had been many instances where this Court allowed the execution by motion even after the lapse of five years. These exceptions have one common denominator, and that is, the delay is caused or occasioned by actions of the judgment debtor and/or is incurred for his benefit or advantage.[10]

Here, the judgment of the trial court sought to be executed became final and executory on December 26, 1991. The writ of execution was issued on September 17, 1992. It could not be enforced for the full satisfaction of the judgment within the five-year period because Macapagal and Silverio filed with the Court of Appeals and this Court petitions challenging the trial court’s judgment and the writ of execution. Such petitions suspended or interrupted the further enforcement of the writ.

As stated earlier, on April 18, 1997, this Court rendered its Decision in G.R. No. 110610 and G.R. No. 113851 dismissing the petitions of Macapagal and Silverio assailing the trial court’s judgment in Civil Case No. CEB-2058. In 1998, this Court denied with finality their motions for reconsideration. And in the instant petitions, Macapagal and Silverio are attacking the validity of the writ of execution by the trial court. Because of their maneuvers, there has been a delay of sixteen (16) years in the enforcement of such judgment, reckoned from its finality on December 26, 1991 up to the present. Indeed, the enforcement of the trial court’s judgment by motion has been interrupted by the acts of Macapagal and Silverio the judgment debtors.

Every litigation must come to an end. While a litigant’s right to initiate an action in court is fully respected, however, once his case has been adjudicated by a competent court in a valid final judgment, he should not be permitted to initiate similar suits hoping to secure a favorable ruling, for this will result to endless litigations detrimental to the administration of justice.[11]

Let it be stressed that with respect to Macapagal and Silverio the Decision of the trial court has attained finality. Such definitive judgment is no longer subject to change, revision, amendment or reversal. Upon finality of the judgment, the court loses its jurisdiction to amend, modify or alter the same. Except for correction of clerical errors or the making of nunc pro tunc entries which causes no prejudice to any party, or where the judgment is void, the judgment can neither be amended nor altered after it has become final and executory. This is the principle of immutability of final judgment.

In Lim v. Jabalde,[12] this Court further explained the necessity of adhering to the doctrine of immutability of final judgments, thus:“Litigation must end and terminate sometime and somewhere and it is essential to aneffective and efficient administration of justice that, once a judgment has become final, the winning party be, not through a mere subterfuge, deprived of the fruits of the verdict. Courts must therefore guard against any scheme calculated to bring about that result. Constituted as they are to put an end to controversies, courts should frown upon any attempt to prolong them.†�Every litigation must come to an end once a judgment becomes final, executory and unappealable. For just as a losing party has the right to file an appeal within the prescribed period, the winning party also has the correlative right to enjoy the finality of the resolution of his case by the execution and satisfaction of the judgment, which is the

“life of the law.†Any attempt to thwart this rigid rule and deny the prevailing litigant his right to savour the �fruit of his victory must immediately be struck down.[13] The statute of limitations has not been devised against those who wish to act but cannot do so, for causes beyond their control.[14]

WHEREFORE, we GRANT the Petition of Esteban Yau in G.R. No. 158848 and DENYthe petition of Arturo Macapagal in G.R. No. 171994. The Decision of the Court of Appeals in CA-G.R. SP No. 72202 is REVERSED, while the Decision of the Court of Appeals in CA-G.R. SP No. 60106 is AFFIRMED. The RTC, Branch 6, Cebu City, is directed to order its sheriff to continue the implementation of the writ of execution issued in Civil Case No. CEB-2058 until the award in favor of petitioner Esteban Yau shall have been fully satisfied.

Costs against Ricardo C. Silverio, Sr. and Arturo Macapagal.

SO ORDERED.

Puno, C.J. (Chairperson), Azcuna, Leonardo-De Castro, and Reyes. JJ., concur.Corona. J., no part. close to party.

* No part.** Additional member pursuant to Administrative Circular No. 84-2007.

[1] Under Rule 45 of the 1997 Revised Rules of Civil Procedure, as amended.

[2] Penned by Associate Justice Eliezer R. De Los Santos with Associate Justice Romeo A. Brawner (retired; now Comelec Commissioner) and Associate Justice Regalado E. Maambong concurring; Rollo, pp. 55-80.

[3] Penned by Associate Justice Pampio A. Abarintos with Associate Justice Mercedes Gozo-Dadole and Associate Justice Ramon M. Bato, Jr. concurring; id., pp. 35-42.

[4] Docketed as Civil Case No. CEB-2058.

[5] Rollo, G.R. No. 171994, pp. 52-53.

[6] Macapagal v. Court of Appeals, et al. G.R. No. 110610 and Silverio, et al. v. Court of Appeals, et al., G.R. No. 113851, October 8, 1998, 297 SCRA 429.

[7] Rollo, G.R. No. 158848, p. 60.

[8] Id., p. 80.

[9] G.R. Nos. 117622-23, October 23, 2006, 505 SCRA 8, citing Lancita v. Magbanua, 7 SCRA 42 (1963).

[10] Camacho v. Court of Appeals, G.R. No. 118339, March 19, 1998, 287 SCRA 611, citing Republic v. Court of Appeals, 260 SCRA 344 (1996).

[11] Id.

[12] G.R. No. 36786, April 17, 1989, 172 SCRA 211 cited in Seven Brother Shipping Corporation v. Oriental Assurance Corporation, supra.

[13] Seven Brother Shipping Corporation v. Oriental Assurance Corporation, supra, citing In Re: Petition for Clarification as to the Validity and Forceful Effect of Two (2) Final and Executory

but Conflicting Decisions of the Honorable Supreme Court, G.R. No. 123780,September 24, 2002, 389 SCRA 493.

[14] Lancita v. Magbanua, supra at footnote 9.

Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. Nos. 166309-10             November 25, 2008

REPUBLIC OF THE PHILIPPINES, represented by the COMMISSIONER OF CUSTOMS, petitioner vs.UNIMEX MICRO-ELECTRONICS GmBH, respondent.

R E S O L U T I O N

CORONA, J.:

Parties must accept and respect the final and executory decision of this Court. They should know when enough is enough. They are not at liberty to continue filing clarificatory motions in disregard of a previous directive that no further pleadings would be entertained.

These cases were decided on March 9, 2007. The dispositive portion of the decision read:

WHEREFORE, the assailed decisions of the Court of Appeals in CA-G.R. SP Nos. 75359 and 75366 are hereby AFFIRMED with MODIFICATION. Petitioner Republic of the Philippines, represented by the Commissioner of the Bureau of Customs, upon payment of the necessary customs duties by respondent Unimex Micro-Electronics GmBH, is hereby ordered to pay respondent the value of the subject shipment in the amount of Euro 669,982.565. Petitioner's liability may be paid in Philippine currency, computed at the exchange rate prevailing at the time of actual payment.

SO ORDERED.

The decision became final and executory on August 2, 2007 and entry of judgment of the March 9, 2007 decision was made on November 7, 2007.

Upon motion of respondent Unimex Micro-Electronics GmBH, an elucidation of the March 9, 2007 decision was made in a resolution dated December 10, 2007 where the Court explained:

legal interest on the amount awarded at the rate of 6% per annum from September 5, 2001 up to the finality of the decision may be imposed and that, thereafter, the legal interest shall be 12% per annum until the value of the shipment is fully paid.

The December 10, 2007 resolution also included a directive to the parties that no further pleadings would be entertained. Despite this, however, respondent filed another motion for further clarification on the manner of determining the reckoning point of the imposition of the 6% legal interest while petitioner Republic of the Philippines filed a motion for clarification of the resolution dated December 10, 2007 (to which motion respondent filed a comment/opposition).

In view of the resolution dated December 10, 2007 which ordered that no further pleadings would be entertained, the Court expunged respondent's motion for further clarification from the records and noted without action petitioner's motion for clarification in resolutions dated January 30, 2008 and April 16, 2008.

In total disregard of the foregoing, however, respondent filed yet another urgent motion for the immediate resolution of all [alleged] pending issues for clarification.

The motion is denied. No issue remains pending in this case. Likewise, no issue needs to be further clarified.

The expunction of respondent's motion for further clarification and the notation without action of petitioner's motion for clarification meant that the said motions were denied. Moreover, the Court has sufficiently and clearly explained the basis of its action in this case in its March 9, 2007 decision and December 10, 2007 resolution.

A statement of this Court that no further pleadings would be entertained is a declaration that the Court has already considered all issues presented by the parties and that it has adjudicated the case with finality. It is a directive to the parties to desist from filing any further pleadings or motions. Like all other orders of this Court, it must be strictly observed by the parties. It should not be circumvented by filing motions ill-disguised as requests for clarification.

WHEREFORE, the urgent motion for the "immediate resolution of all pending issues for clarification" is herebyDENIED. The parties, their respective counsels, agents or representatives are hereby WARNED not to file any further pleadings or motions in this case under pain of contempt.

SO ORDERED.

RENATO C. CORONAAssociate Justice

WE CONCUR:

REYNATO S. PUNOChief JusticeChairperson

ANTONIO T. CARPIOAssociate Justice

ADOLFO S. AZCUNAAssociate Justice

*DANTE O. TINGAAssociate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

REYNATO S. PUNOChief Justice

Footnotes

* As replacement of Justice Teresita J. Leonardo-De Castro who is on official leave per Special Order No. 539.

Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. 160762             May 3, 2006

Spouses JOSEPHINE MENDOZA GO & HENRY GO, Petitioners, vs.LEONARDO YAMANE, Respondent.

D E C I S I O N

PANGANIBAN, CJ:

Property purchased by spouses during the existence of their marriage is presumed to be conjugal in nature. This presumption stands, absent any clear, categorical, and convincing evidence that the property is paraphernal. Conjugal property cannot be held liable for the personal obligation contracted by one spouse, unless some advantage or benefit is shown to have accrued to the conjugal partnership.

The Case

Before the Court is a Petition for Review1 under Rule 45 of the Rules of Court, challenging the November 22, 2002 Decision2 and the September 17, 2003 Resolution3 of the Court of Appeals (CA) in CA-GR CV No. 60939. The assailed Decision disposed as follows:

"WHEREFORE, premises considered, the Decision appealed from is hereby REVERSED and SET ASIDE. The Sheriff's Certificate of Sale dated August 12, 1981 and the Final Sheriff's Certificate of Sale dated August 26, 1982 are declared NULL and VOID."4

The CA denied reconsideration in its September 17, 2003 Resolution.

The Facts

The undisputed factual findings of the CA are as follows:

"Involved in the suit is a 750 square meters (sic) parcel of lot located at Res. Sec. 'K', Baguio City, registered in the name of Muriel Pucay Yamane, wife of Leonardo Yamane, [respondent] herein, under Transfer Certificate of Title No. 12491.

"As a result of a motion for execution of a charging lien filed by Atty. Guillermo F. De Guzman in Civil Case No. 1841, entitled 'Florence Pucay De Gomez, Elsie Pucay Kiwas and Muriel Pucay Yamane v. Cypress Corporation,' which said counsel handled for the plaintiffs therein, hereinafter collectively referred to as the Pucay sisters, the subject property was levied to satisfy the lien for attorney's fees in

the amount of P10,000. The said property was scheduled to be sold at public auction on August 11, 1981.

"Four days prior to the auction sale, [respondent] filed a Third-Party Claim with the Office of the Provincial Sheriff to stop the public auction on the ground that the subject property is conjugal property and, therefore, should not be held answerable for the personal obligation of the Pucay sisters. However, the Sheriff proceeded with the auction sale despite [respondent's] protest. The subject property was sold to spouses Josephine [and] Henry Go (or [petitioners]) as highest bidder. No redemption having been made during the one-year period, a Final Sheriff's Certificate of Sale was eventually issued on August 26, 1982 conveying and transferring the said property to [petitioners].

"On September 4, 1984, [respondent] filed a Complaint with the Regional Trial Court of Baguio City, docketed as Civil Case No. 417-R, against [petitioners] and Sheriff Melgar for annulment and cancellation of auction sale upon the same ground stated in the abovementioned third-party claim. Citing the Order of the Regional Trial Court of Baguio City, Branch V in LRC Case No. 2288, which ordered the cancellation of TCT No. 12491 and directed the Register of Deeds to issue new title in the name of Josephine Go x x x, [petitioners] moved to dismiss the complaint on the ground of res judicata. In the Order dated November 28, 1984, the motion was denied by the trial court.

"In their Answer filed on December 10, 1984, [petitioners] denied the material allegations of the complaint and interposed the following special affirmative defenses: that the cause of action was barred by prior judgment; that [respondent] has not pursued any lawful remedy to annul the execution proceeding; that there is no flaw or irregularity in the auction sale; and that since the execution sale was made in accordance with Section 21, Rule 39 of the Revised Rules of Court, it is deemed final and any irregularity committed in the course thereof will not vitiate its validity.

"On December 28, 1984, Muriel likewise lodged a Complaint for Damages, docketed as Civil Case No. 505-R, against [petitioners] and Atty. Guillermo De Guzman alleging, in gist, fraud, misrepresentation, manipulation and unlawful acts of the defendants in causing the levy of the subject property with an estimated commercial value of P200,000 as against a charging lien in the amount of P10,000.

"In its May 27, 1985 Order, the trial court ordered the joint hearing of Civil Cases Nos. 417-R and 505-R. On August 30, 1985, Muriel was declared non-suited for failure to appear in the hearing despite due notice. As a consequence, Civil Case No. 505-R was dismissed on October 15, 1985."5

In its Decision6 dated March 25, 1998, the Regional Trial Court (RTC) of Baguio City, Branch 4, held that the subject parcel of land was the paraphernal property of the late Muriel Pucay Yamane -- spouse of respondent -- and was not their conjugal property. The appearance of his name on the Transfer Certificate of Title (TCT) was deemed to be merely descriptive of the civil status of the registered owner, his late wife. Hence, finding that he had no legal standing to question the auction sale or to pray for its annulment or cancellation, the RTC dismissed the case for lack of merit.

Upon receipt of the RTC Decision on April 8, 1998, respondent filed a Motion,7 in which he prayed that he be allowed to file his Motion for Reconsideration of the Decision, on or before May 30, 1998. The trial court granted8 his Motion; received the Motion for Reconsideration,9which was filed on May 28, 1998; and eventually denied it in its Order dated June 5, 1998.10 He then elevated the matter to the CA on June 15, 1998.

Ruling of the Court of Appeals

The CA reversed the RTC's Decision. The Sheriff's Certificate of Sale dated August 12, 1981, and the

Final Sheriff's Certificate of Sale dated August 26, 1982, were declared null and void.

According to the appellate court, property acquired during marriage is presumed to be conjugal, unless the exclusive funds of one spouse are shown to have been used for the purpose. That the land was acquired during the spouses' coverture was sufficiently established by the TCT and the Deed of Absolute Sale, both indicating that Muriel Pucay Yamane was "married to Leonardo Yamane"; and by the undisputed testimony of the previous owner, Eugene Pucay. Because of petitioners' failure to establish that the land in question had been acquired by Muriel using her exclusive funds, the CA concluded that the contested land was conjugal property.

The appellate court further held thus:

"x x x [T]he disputed property being a conjugal property of [respondent] and his wife, and absent any showing of some advantage or benefit that accrued to their conjugal partnership from the transaction between the Pucay sisters and Atty. De Guzman, the public auction sale of the subject property in favor of [petitioners] is null and void."11

Hence, this Petition.12

Issues

Petitioners submit the following issues for our consideration:

"I. The Court of Appeals gravely erred in taking cognizance of the appeal and in not dismissing the same, despite the fact that the respondent failed to perfect his appeal within the 15-day reglementary period set by the Rules of Court.

"II. The Court of Appeals gravely erred in declaring the subject property as conjugal property, despite the existence of clear evidence showing that the subject property is the exclusive paraphernal property of Muriel who, even during her lifetime, always claimed the said property as her own exclusive paraphernal property and not as property co-owned with her husband, the respondent herein.1avvphil.net

"III. The Court of Appeals, assuming, ex grati argumenti, that the subject property is conjugal property between respondent and Muriel, gravely erred in ruling that the same cannot answer for the charging lien of Atty. Guillermo de Guzman in Civil Case No. 1841."13

In the main, they posit two issues. They raise, first, the procedural question of whether the CA erred in giving due course to respondent's lapsed appeal; and, second, the substantive issue of whether the subject property is conjugal or paraphernal.

The Court's Ruling

The Petition has no merit.

Procedural Issue:

Whether Respondent's Appeal Should Be Given Due Course

Petitioners contend that the CA erred in giving due course to the appeal filed by respondent beyond the

15-day reglementary period.

Concededly, he received a copy of the RTC Decision on April 8, 1998. He had, therefore, until April 23, 1998, within which to file an appeal. Prior to the latter date, however, he moved that his new counsel be allowed to file a motion for reconsideration on May 30, 1998. It was eventually filed on May 28, 1998, but was denied. Respondent subsequently filed a Notice of Appeal on June 15, 1998. By this time, the original period to appeal had expired. It should be clear that the Rules prohibit an extension to file a motion for reconsideration.14

The perfection of an appeal in the manner and within the period prescribed by the Rules of Civil Procedure is not only mandatory, but also jurisdictional; and the lapse of the appeal period of fifteen days deprives a court of the jurisdiction to alter a final judgment.15

There have been exceptions, however, in which the Court dispensed with technical infirmities and gave due course to tardy appeals. In some of those instances, the presence of any justifying circumstance recognized by law -- such as fraud, accident, mistake or excusable negligence -- properly vested the judge with discretion to approve or admit an appeal filed out of time.16 In other instances, lapsed appeals were allowed in order to serve substantial justice, upon consideration of a) matters of life, liberty, honor or property; b) the existence of special or compelling circumstances; c) the merits of the case; d) causes not entirely attributable to the fault or negligence of the party that would be favored by the suspension of the rules; e) the failure to show that the review being sought was merely frivolous and dilatory; and f) the fact that the other party would not be unjustly prejudiced.17

Indeed, in some exceptional cases, the Court has allowed the relaxation of the rules regulating the reglementary periods of appeal. These exceptions were cited in Manila Memorial Park Cemetery v. CA,18 from which we quote:

"In Ramos vs. Bagasao, the Court excused the delay of four days in the filing of the notice of appeal because the questioned decision of the trial court had been served upon appellant Ramos at a time when her counsel of record was already dead. The new counsel could only file the appeal four days after the prescribed reglementary period was over. In Republic vs. Court of Appeals, the Court allowed the perfection of an appeal by the Republic despite the delay of six days to prevent a gross miscarriage of justice since the Republic stood to lose hundreds of hectares of land already titled in its name and had since then been devoted for public purposes. In Olacao vs. National Labor Relations Commission, a tardy appeal was accepted considering that the subject matter in issue had theretofore been judicially settled with finality in another case, and a dismissal of the appeal would have had the effect of the appellant being ordered twice to make the same reparation to the appellee."19

We believe that a suspension of the Rules is similarly warranted in the present controversy. We have carefully studied the merits of the case and noted that the review being sought has not been shown to be merely frivolous and dilatory. The Court has come to the conclusion that the Decision of the RTC, Branch 4 (in Civil Case No. 417-R), must be set aside. It would be far better and more prudent to attain the ends of justice, rather than to dispose of the case on technicality and cause grave injustice in the process. Thus, we would rather excuse a technical lapse and afford respondent a review of the case on appeal.

Substantive Issue:

Paraphernal or Conjugal?

The purchase of the property had been concluded in 1967, before the Family Code took effect on August 3, 1988.20 Accordingly, the transaction was aptly covered by the then governing provisions of the New

Civil Code. On the latter basis, therefore, we shall resolve the issue of the nature of the contested property.

Article 160 of the New Civil Code provides that "all property of the marriage is presumed to belong to the conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife."21 As a conditio sine qua non for the operation of this article in favor of the conjugal partnership,22 the party who invokes the presumption must first prove that the property was acquired during the marriage.23

In other words, the presumption in favor of conjugality does not operate if there is no showing of when the property alleged to be conjugal was acquired.24 Moreover, the presumption may be rebutted only with strong, clear, categorical and convincing evidence.25 There must be strict proof of the exclusive ownership of one of the spouses,26 and the burden of proof rests upon the party asserting it.27

The CA committed no error in declaring that the parcel of land belonged to the conjugal partnership of Spouses Muriel and Leonardo Yamane. They acquired it from Eugene Pucay on February 27, 1967,28 or specifically during the marriage.29 We then follow the rule that proof of the acquisition of the subject property during a marriage suffices to render the statutory presumption operative. It is clear enough that the presently disputed piece of land pertains to the conjugal partnership.

Petitioners concede that the property was acquired during the subsistence of the marriage of Muriel to respondent.30 Nonetheless, they insist that it belonged exclusively to her for the following reasons:

First. Respondent never denied nor opposed her claim in Civil Case No. 505-R, which she had filed during her lifetime; or in AG-GR Sp. No. 01616 (entitled "Muriel Pucay Yamane v. Josephine Go"), that the disputed parcel of land was her exclusive paraphernal property. They allege that his failure to file a denial or opposition in those cases is tantamount to a judicial admission that militates against his belated claim.

Second. The Deed of Absolute Sale of the property is in the sole name of Muriel. Petitioners posit that, had the spouses jointly purchased this piece of land, the document should have indicated this fact or carried the name of respondent as buyer.

Third. The failure of respondent to redeem the parcel of land within the redemption period after the auction sale indicated that he was not its co-owner.

We will discuss the three arguments seriatim.

Unilateral Declaration

Respondent's interest cannot be prejudiced by the claim of Muriel in her Complaint in Civil Case No. 505-R that the subject parcel of land was her paraphernal property. Significantly, the nature of a property -- whether conjugal or paraphernal -- is determined by law and not by the will of one of the spouses.31 Thus, no unilateral declaration by one spouse can change the character of a conjugal property.32

Besides, the issue presented in Civil Case No. 505-R was not the nature of the subject piece of land being levied upon, but whether Atty. Guillermo de Guzman was entitled to a charging lien. In that case, Muriel claimed that she had not officially retained him as counsel, and that no lawyer-client relationship had been established between them.33

Deed and Title in the Name of One Spouse

Further, the mere registration of a property in the name of one spouse does not destroy its conjugal nature.34 Hence, it cannot be contended in the present case that, simply because the title and the Deed of Sale covering the parcel of land were in the name of Muriel alone, it was therefore her personal and exclusive property. In concluding that it was paraphernal, the trial court's reliance on Stuart v. Yatco35 was clearly erroneous.

As stated earlier, to rebut the presumption of the conjugal nature of the property, petitioners must present clear and convincing evidence. We affirm and quote below, for easy reference, the relevant dispositions of the CA:

"x x x. We are unable to go along with [petitioners'] contention that the subject property was acquired by Muriel with her exclusive funds. Mere registration of the contested property in the name of the wife is not sufficient to establish the paraphernal nature of the property. This reminds Us of the teaching in the recent case of Diancin v. Court of Appeals, that all the property acquired by the spouses, regardless of in whose name the same is registered, during the marriage is presumed to belong to the conjugal partnership of gains, unless it is proved that it pertains exclusively to the husband or to the wife. To quote:

"As a general rule, all property acquired by the spouses, regardless of in whose name the same is registered, during the marriage is presumed to belong to the conjugal partnership of gains, unless it is proved that it pertains exclusively to the husband or to the wife. In the case at bar, the fishpond lease right is not paraphernal having been acquired during the coverture of the marriage between Matilde and Tiburcio, which was on April 9, 1940. The fact that the grant was solely in the name of Matilde did not make the property paraphernal property. What was material was the time the fishpond lease right was acquired by the grantee, and that was during the lawful existence of Matilde's marriage to Tiburcio.

"x x x [T]his presumption is rebuttable, but only with strong, clear and convincing evidence. The burden of proving that the property belongs exclusively to the wife rests upon the party asserting it. Mere assertion of the property's paraphernal nature is not sufficient."

"The record as well as the foregoing established jurisprudence lead us to conclude that the contested property was indeed acquired during the marriage of herein [respondent] and Muriel. To prove that it is nonetheless paraphernal property, it is incumbent upon [petitioners] to adduce strong, clear and convincing evidence that Muriel bought the same with her exclusive funds. [Petitioners] failed to discharge the burden. Nowhere in the evidence presented by them do We find any indication that the land in question was acquired by Muriel with her exclusive funds. The presumption not having been overthrown, the conclusion is that the contested land is conjugal property."36

Non-Redemption After the Auction Sale

The non-redemption of the property by respondent within the period prescribed by law did not, in any way, indicate the absence of his right or title to it. Contrary to petitioners' allegation, the fact is that he filed a Third-Party Claim37 with the sheriff, upon learning of the levy and impending auction sale. This fact was specifically admitted by petitioners.38 Respondent claimed that the parcel of land was conjugal, and that he could not answer for the separate obligation of his wife and her sisters.39 Notwithstanding his claim, the disputed piece of land was sold at a public auction on August 11, 1981. Consequently issued were a Sheriff's Certificate of Sale dated August 12, 1981, and a Final Sheriff's Certificate of Sale dated August 26, 1982.40

Likewise, in his Opposition (Answer) to the Petition in LRC File Adm. Case No. 2288,41 respondent raised the issue of the conjugal nature of the property and reserved his right to file an independent action to annul the auction sale. In its March 30, 1983 Order,42 however, Branch 5 of the RTC of Baguio City did not rule on either the actual ownership or the nature of the parcel of land. Rather, it granted the

Petition to issue a new certificate of title in favor of Petitioner Josephine Mendoza Go. It found that, under Section 75 of Presidential Decree 1529, respondent had no legal standing to question the auction sale, because he was not the registered owner of the property. Instead, his right to prove his claim in a separate and independent action was upheld.43 Thus, he instituted the present case for annulment and cancellation of the auction sale.

The foregoing points clearly explain the failure of respondent to redeem the property. Misplaced is petitioners' emphasis on his failure to do so within the period required by law, because redemption in this case would have been inconsistent with his claim that the sale was invalid.44Redemption would have served as an implied admission of the regularity of the sale and estopped him from later impugning its validity on that ground.45

Since petitioners have failed to present convincing evidence that the property is paraphernal, the presumption that it is conjugal therefore stands. The next question before us is, whether the charging lien of Atty. de Guzman may be properly enforced against the piece of land in question.

Charging Lien Not Chargeable Against Conjugal Property

It is indisputable that the services of Atty. de Guzman were acquired during the marriage of respondent and Muriel. The lawyer's legal services were engaged to recover from Cypress Corporation (in Civil Case No. 1841) the balance of the purchase price of the sale of the exclusive property of Muriel and her sisters.46 The recovery was done during the marriage.47

The CA elucidated on this matter as follows:

"x x x. The contract or transaction between Atty. De Guzman and the Pucay sisters appears to have been incurred for the exclusive interest of the latter. Muriel was acting privately for her exclusive interest when she joined her two sisters in hiring the services of Atty. De Guzman to handle a case for them. Accordingly, whatever expenses were incurred by Muriel in the litigation for her and her sisters' private and exclusive interests, are her exclusive responsibility and certainly cannot be charged against the contested conjugal property.

"Even on the remote assumption that the conjugal property could be held liable, levy on execution of the same property should still be denied in accordance with the ruling in Luzon Surety Co., Inc. v. De Garcia that before a conjugal property could be held liable for the obligation contracted by a spouse, there must be a showing of some advantage or benefit that accrued to the conjugal partnership. Concededly, the burden is on the [petitioners] to prove that the services rendered by Atty. De Guzman in handling Civil Case No. 1841 for the Pucay sisters had, somehow, redounded to the benefit of the conjugal partnership of herein [respondent] and Muriel. This onus, [petitioners], however, failed to discharge."48

We find no reason to deviate from the CA's findings, which are amply supported by evidence. The expenses incurred by Muriel for the recovery of the balance of the purchase price of her paraphernal property are her exclusive responsibility.49 This piece of land may not be used to pay for her indebtedness, because her obligation has not been shown to be one of the charges against the conjugal partnership.50Moreover, her rights to the property are merely inchoate prior to the liquidation of the conjugal partnership.

Under the New Civil Code, a wife may bind the conjugal partnership only when she purchases things necessary for the support of the family, or when she borrows money for that purpose upon her husband's failure to deliver the needed sum;51 when administration of the conjugal partnership is transferred to the wife by the courts52 or by the husband;53 or when the wife gives moderate donations for charity.54 Failure

to establish any of these circumstances in the present case means that the conjugal asset may not be bound to answer for Muriel's personal obligation.

The power of the court in executing judgments extends only to properties unquestionably belonging to the judgment debtor alone.55 In this case, therefore, the property -- being conjugal in nature -- cannot be levied upon.56

WHEREFORE, the Petition is DENIED, and the assailed Decision and Resolution AFFIRMED. Costs against petitioners.

SO ORDERED.

ARTEMIO V. PANGANIBANChief JusticeChairperson, First Division

WE CONCUR:

CONSUELO YNARES-SANTIAGOAssociate Justice

MA. ALICIA AUSTRIA-MARTINEZAsscociate Justice

ROMEO J. CALLEJO, SR.Associate Justice

MINITA V. CHICO-NAZARIOAsscociate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

ARTEMIO V. PANGANIBANChief Justice

Footnotes

1 Rollo, pp. 8-22.

2 Annex "L" of Petition; id. at 62-72. Penned by Justice Rebecca de Guia-Salvador and concurred in by Justices Rodrigo V. Cosico (Division chairperson) and Regalado E. Maambong (member).

3 Annex "N" of Petition; id. at 82.

4 Assailed CA Decision, p. 10; id. at 71.

5 Id. at 1-3; id. at 62-64.

6 Annex "A" of petitioners' Memorandum; rollo, unnumbered. Penned by acting Presiding Judge Robert T. Cawed.

7 Rollo, p. 53.

8 Id. at 54.

9 Id. at 55-57.

10 Id. at 58.

11 Assailed CA Decision, p. 10; rollo, p. 71.

12 This case was deemed submitted for decision on January 5, 2005, upon this Court's receipt of petitioners' Memorandum, signed by Atty. Emiliano L. Gayo. Respondent's Memorandum, signed by Atty. Albert A. Umaming, was received by the Court on December 22, 2004.

13 Petitioners' Memorandum, p. 11; rollo, unnumbered.

14 Rules of Court, Rule 41, Sec. 3.

15 J. Feria and M.C. Noche, Civil Procedure Annotated, Vol. 2, 163 (2001); Neypes v. CA, GR No. 141524, September 14, 2005.

16 Catubay v. NLRC, 330 SCRA 440, April 12, 2000.

17 Dela Cruz v. Sison, GR No. 142464, September 26, 2005; Barnes v. Hon. Padilla, 461 SCRA 533, June 28, 2005 (citing Sanchez v. Court of Appeals, 404 SCRA 540, June 20, 2003 and Aguam v. CA, 332 SCRA 784, May 31, 2000).

18 344 SCRA 769, November 15, 2000.

19 Id. at 777, per Vitug, J.

20 M. Sta. Maria, Jr., Persons and Family Relations Law, 94 (3rd ed., 1999).

21 The provision is reproduced in Article 116 of the Family Code, which states: "All property acquired during the marriage, whether the acquisition appears to have been made, contracted or registered in the name of one or both spouses, is presumed to be conjugal unless the contrary is proved."

22 Flora v. Prado, 420 SCRA 396, January 20, 2004.

23 Acabal v. Acabal, 454 SCRA 555, March 31, 2005; Jocson v. CA, 170 SCRA 333, February 16, 1989.

24 Phil. National Bank v. CA, 153 SCRA 435, August 31, 1987.

25 Wong v. IAC, 200 SCRA 792, August 19, 1991.

26 Ching v. CA, 423 SCRA 356, February 23, 2004; Francisco v. CA, 359 Phil. 519, November 25, 1998.

27 Tan v. CA, 339 Phil. 423, June 10, 1997.

28 Annex "P" of the Petition; rollo, p. 87.

29 See Annex "2-A" of respondent's Comment, p. 2; rollo, p. 148.

30 See petitioners' Memorandum, p. 22; rollo, unnumbered.

31 Villanueva v. CA, 427 SCRA 439, April 14, 2004.

32 Id.

33 See Annex "C" of Petition; rollo, pp. 34-38.

34 Acabal v. Acabal, supra note 20 (citing Mendoza v. Reyes, 124 SCRA 154, August 17, 1983 and Bucoy v. Paulino, 23 SCRA 248, April 26, 1968).

35 4 SCRA 1143, April 27, 1962.

36 Assailed CA Decision, pp. 7-8; rollo, pp. 68-69.

37 Third Party Claim dated August 3, 1981; rollo, pp. 135-136.

38 See Answer dated December 7, 1984, p. 2; rollo, p. 29.

39 See Complaint dated August 31, 1984, p. 3; rollo, p. 25.

40 Annex "1-F" of Respondent's Comment; rollo, pp. 141-142. The third "Whereas" clause states that the sale was made in accordance with Rule 39, Section 17 of the Rules of Court; Article 161 of the Civil Code; and Fulgencio v. Gatchalian, 21 Phil. 252, January 23, 1912.

41 In re: Petition for the Issuance of New Title, filed by Josephine Mendoza Go against Muriel Pucay Yamane and Leonardo Yamane before the Regional Trial Court, First Judicial Region of Baguio City, Branch V.

42 Annex "2-A" of respondent's Comment; rollo, pp. 147-150.

43 Id. at 2-3; rollo, pp. 148-149.

44 Cometa v. Intermediate Appellate Court, 151 SCRA 563, June 30, 1987.

45 Perez v. CA, 464 SCRA 89, July 22, 2005; Aclon v. CA, 387 SCRA 415, August 20, 2002; Cometa v. Intermediate Appellate Court, 151 SCRA 563, June 30, 1987.

46 See Reply dated June 9, 2004, p. 1; rollo, p. 241.

47 Id.

48 Assailed CA Decision, p. 9; rollo, p. 70.

49 A. Tolentino, Commentaries and Jurisprudence on the Civil Code of the Phils., Vol. I, 456 (1990).

50 Civil Code, Art. 161. The conjugal partnership shall be liable for the following:

(1) All debts and obligations contracted by the husband for the benefit of the conjugal partnership, and those contracted by the wife, also for the same purpose, in the cases where she may legally bind the partnership;

(2) Arrears or income due, during the marriage, from obligations which constitute a charge upon property of either spouse or of the partnership;

(3) Minor repairs or for mere preservation made during the marriage upon the separate property of either the husband or the wife; major repairs shall not be charged to the partnership;

(4) Major or minor repairs upon the conjugal partnership property;

(5) The maintenance of the family and the education of the children of both husband and wife, and of legitimate children of one of the spouses;

(6) Expenses to permit the spouses to complete a professional, vocational or other course.

51 Id., Art. 115.

52 Id., Arts. 167, 178 and 196.

53 Id., Art. 168.

54 Id., Art. 174.

55 Republic v. Enriquez, 166 SCRA 608, October 21, 1988; Wong v. IAC, 200 SCRA 792, August 19, 1991.

56 Johnson and Johnson (Phils.) v. CA, 330 Phil. 856, September 23, 1996.Republic of the Philippines

SUPREME COURTManila

THIRD DIVISION

G.R. No. 153986             June 8, 2007

IN RE: PETITION FOR ADMISSION AS CITIZENS OF THE PHILIPPINES, SHEWAK A. KESWANI AND KAVITA S. KESWANI, petitioners, 

vs.REPUBLIC OF THE PHILIPPINES, respondent.

D E C I S I O N

AUSTRIA-MARTINEZ, J.:

Petitioners-spouses Shewak and Kavita Keswani (petitioners) are Indian nationals who filed a joint Amended Petition for naturalization, docketed as Naturalization Case No. M-68, with the Regional Trial

Court (RTC) of Makati, Branch 60, sometime in 1998. As summed up by the Court of Appeals (CA), their amended petition contained the following allegations:

x x x (1) petitioners are spouses of Indian nationality having been born in India on August 23, 1953 (Shewak) and September 1, 1957 (Kavita) with four (4) children who were all born in the Philippines

and students at Brent School, an educational institution recognized by the Philippines Government where Philippine History, Government and Civics are taught; said children are residing at their parents’ address at 2284 Magnolia St., Dasmariñas, Makati City; (2) petitioner Shewak Keswani arrived for the first time in the Philippines on March 24, 1976 via Qantas AirLines, joined later by his wife, and have since continuously resided in the Philippines in the various addresses in Quezon City, Manila, Pasig City, Mandaluyong City and Makati City; (2) they can speak Tagalog, English and Sindhi (Indian

dialect); (3) they are persons of good moral character and believe in the principles underlying the Philippine Constitution; have conducted themselves in proper and irreproachable manner during the entire period of their residence in the Philippines up to the present in their relation with the constituted

government as well as with the community in which they live; (4) more than a year prior to the filing of the present petition, they filed their Affidavit of Joint Declaration of Intention to become citizens of the

Philippines; (5) they own real properties in the Philippines and are both stockholders of Glamour Garments, Inc. and Chitra Manufacturing, Inc., both primarily engaged in the manufacture and export of garments; as majority stockholders they both derive annual gross income of more than P2,000,000.00;

(6) they have all the qualifications required under Sec. 2 and none of the disqualifications provided under Sec. 4 of C.A. No. 473, as amended – they have not opposed organized government or affiliated with any association who uphold and teach doctrines opposing all organized government; they do not

defend or teach the necessity or propriety of violence, personal assault, or assassination for the success and predominance of these ideals; they are not polygamists or believers in polygamy; they have not been convicted of any crime involving moral turpitude nor suffering from any mental alienation or incurable

contagious diseases; during the period of their residence in the Philippines up to the present, they continue to mingle socially with Filipinos and evince sincere desire to learn and embrace the customs,

traditions and ideals of the Filipinos; and their country, India, is not at war with Philippines and likewise grants the right to become naturalized citizens of India; and (7) it is their intention in good faith to

become citizens of the Philippines and to renounce absolutely and forever any allegiance and fidelity to India; they will reside continuously in the Philippines from the date of the filing of the petition up to the

time of their admission to Philippine citizenship.1

Notices of hearing on the petition were posted on December 7, 1998, while publication was made on different dates in 1999. Thereafter, anex parte hearing was held on September 27 and October 11, 1999, where petitioners and two character witnesses were presented to prove the allegations in their petition.

On May 9, 2000, the RTC rendered its Decision granting the Amended Petition and admitting petitioners as Filipino citizens.2

After receiving a copy of the RTC Decision on May 12, 2000,3 the Office of the Solicitor General (OSG) filed a Notice of Appeal on June 1, 2000, which was given due course by the RTC per Order

dated June 14, 2000.4

Petitioners filed a Motion to Dismiss Appeal before the CA, alleging that the Notice of Appeal was filed by the OSG beyond the 15-day reglementary period. The CA, however, denied petitioners’ motion in its

Resolution dated April 3, 2001, taking note that the OSG had already filed an appellant’s brief.5

After completion of the records, the CA6 rendered on January 15, 2002 its Decision, which provides for the following dispositive portion:

WHEREFORE, premises considered, the present appeal is hereby GRANTED and the decision appealed from in Naturalization Case No. M-68 is hereby ANNULLED and SET ASIDE. A new judgment is

hereby rendered DISMISSING the joint petition for naturalization of Shewak A. Keswani and Kavita S. Keswani as Filipino citizens.

No pronouncement as to costs.

SO ORDERED.7

Petitioners now come before the Court on a petition for review on certiorari under Rule 45 of the Rules of Court, asserting the following reasons for its allowance:

1. IN GIVING DUE COURSE TO RESPONDENT'S APPEAL, WHICH IS CONTRARY TO THE PROVISIONS OF SECTION 11, COMMONWEALTH ACT NO. 473, AS AMENDED, THE COURT

OF APPEALS ACTED WITHOUT JURISDICTION, CORRECTIBLE BY CERTIORARI.

2. IN TAKING COGNIZANCE OF RESPONDENT'S APPEAL, FILED DIRECTLY TO THE COURT OF APPEALS, INSTEAD WITH THIS HONORABLE COURT, CONTRARY TO THE PROVISIONS OF SECTION 11 COMMONWEALTH ACT NO. 473, AS AMENDED, THE COURT OF APPEALS

ACTED WITHOUT JURISDICTION, CORRECTIBLE BY CERTIORARI.

3. IN GRANTING THE APPEAL OF RESPONDENT, FILED WITH THE COURT OF APPEALS, WHICH IS CONTRARY TO THE PROVISIONS OF SECTION 11, COMMONWEALTH ACT NO.

473, AS AMENDED, THE COURT OF APPEALS ACTED WITHOUT JURISDICTION, CORRECTIBLE BY CERTIORARI.

4. IN THE ALTERNATIVE, IN HOLDING THAT PETITIONERS-SPOUSE DO NOT POSSESS ALL THE QUALIFICATIONS AND NONE OF THE DISQUALIFICATIONS UNDER THE LAW, THE

COURT OF APPEALS ACTED CONTRARY TO THE LAW OR IN EXCESS OR WITHOUT JURISDICTION, CORRECTIBLE BY CERTIORARI.8

Petitioners posit the argument that the applicable procedure with regard to appeals governing naturalization cases is that provided under Section 11 of Commonwealth Act (C.A.) No. 473 or the

Revised Naturalization Law, as amended, which states that the appeal should be filed with the Supreme Court and not the CA. Petitioners also argue that their testimonies and the testimonies of their two

witnesses are sufficient to establish that they have all the qualifications and none of the disqualifications to become naturalized citizens.

Indeed, Section 11 of C.A. No. 473 provides that "[T]he final sentence may, at the instance of either of the parties, be appealed to the Supreme Court." Note, however, that said law is of 1939 vintage. As

correctly reasoned out by the OSG, this provision of law has already been superseded by subsequent procedural laws, particularly Batas Pambansa Blg. (B.P. Blg.)129 or the Judiciary Reorganization Act of 1980, which vests in the Court of Appeals the appellate jurisdiction over all final judgments, decisions,

resolutions, orders or awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions, among others.9 This provision of B.P. Blg. 129, of course, has been further

supplemented by the 1997 Rules of Civil Procedure, as amended, which provides for the remedy of an ordinary appeal to the Court of Appeals in cases decided by the Regional Trial Court in the exercise of

its original jurisdiction.10 The CA’s power to review the assailed RTC Decision finds further reason as it involves factual findings, and it is beyond dispute that the CA is equipped to resolve factual issues

because, unlike this Court, it is mandated to rule on questions of fact. The appeal filed by the OSG with the CA was therefore proper.

With regard to the sufficiency of petitioners’ evidence, the Court sustains the findings of the CA on this score.

The Court went over the records of this case and indeed, as found by the CA, the evidence for petitioners consists mainly of their testimonies and the testimonies of their supporting

witnesses, sans documentary evidence to back up their statements, thus:

x x x In this case, appellant correctly pointed out that petitioners-appellees failed to prove by evidence the material allegations in their joint petition such as their alleged annual gross earnings and financial status, the conditions for the educational institution where their children are currently enrolled, and the absence of any conviction for offenses involving moral turpitude. Except for their bare and self-serving declarations in court, petitioners-appellees failed to adduce documentary and oral evidence showing that they indeed possess the statutory qualifications. Not even a single document concerning their ownership

of the garment firms of which they allegedly control the majority interest, income tax returns filed showing their annual gross income claimed to be in the amount of P2 million, and those showing the enrollment of their children in the prescribed educational institution. There is absolutely no iota of

evidence proving these allegations which constitute the very required qualifications and disqualifications under the law. x x x 11 (Emphasis supplied)

In Tiu v. Republic,12 it was ruled that "it is the bounden and inescapable duty of anyone applying for naturalization to carry at all times the burden of proving his right thereto, not only by complying with all

the substantive and procedural requirements and submitting proof thereof at the trial x x x."

Moreover, it is a settled rule that one who alleges a fact has the burden of proving it, and mere allegation is not evidence.13 In the present case, aside from said testimonies, there is a dearth of competent

evidence that will corroborate petitioners’ alleged qualifications which will entitle them to be naturalized as Filipino citizens. Consequently, the CA was correct in dismissing the amended petition

for naturalization as Filipino citizens filed by petitioners.

WHEREFORE, the petition is DENIED.

SO ORDERED.

Ynares-Santiago, Chairperson, Chico-Nazario, Nachura, JJ., concur.

Footnotes

1 CA rollo, pp. 85-86.

2 Records, p. 70.

3 Id. at 72.

4 Id. at 75.

5 CA rollo, p. 65.

6 Penned by Associate Justice Martin S. Villarama, Jr., with Associate Justices Conchita Carpio Morales (now a Member of this Court) and Sergio L. Pestaño (retired), concurring.

7 CA rollo, p. 90.

8 Rollo, pp. 11-12.

9 As amended by Republic Act No. 7902, effective March 18, 1995.

10 Rule 41, Section 2 (a).

11 CA rollo, p. 89.

12 158 Phil. 1137, 1138 (1974).

13 Republic v. Orbecido, III, G.R. No. 154380, October 5, 2005, 472 SCRA 114, 123.Republic of the Philippines

SUPREME COURTManila

THIRD DIVISION

G.R. No. 136477             November 10, 2004

M.A. SANTANDER CONSTRUCTION, INC., petitioner, vs.

ZENAIDA VILLANUEVA, respondent.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

Is non-payment of the docket fees and other legal fees a valid ground to dismiss an appeal? This is the only issue in the instant case presented for our resolution.

Challenged in this petition for review are the Resolutions1 of the Court of Appeals dated November 5, 1998 and December 4, 1998 in CA-G.R. CV No. 60439. The Appellate Court dismissed the appeal taken by M.A. Santander Construction, Inc., petitioner, from the adverse Decision of the Regional Trial Court

(RTC), Branch 15, San Mateo, Rizal in Civil Case No. 1153-95 for non-payment of docket and other lawful fees.

The instant case stemmed from a complaint for a sum of money filed with the RTC of San Mateo, Rizal on April 11, 1995 by respondent Zenaida Villanueva against petitioner, docketed as Civil Case No.

1153-95. After hearing the case on the merits, the trial court rendered an undated Decision in favor of

respondent.

On March 9, 1998, petitioner interposed an appeal to the Court of Appeals.

As earlier mentioned, the Court of Appeals dismissed the appeal for petitioner's failure to pay the required appeal fees.

In its motion for reconsideration, petitioner, through counsel alleged:

"II

With deepest apology to this Honorable Tribunal, herein undersigned counsel admits that he failed to pay the corresponding docket and other fees before the Clerk of Court of the Regional Trial Court of San Mateo, Rizal, for reason that still entertains in his mind the old procedure of waiting from this

Honorable COURT for an order/directive to pay the fee before this Honorable COURT OF APPEALS pursuant to the then old standing procedure."2

On November 13, 1998, petitioner paid the required fees.

On December 4, 1998, the Court of Appeals denied petitioner's motion for reconsideration, thus:

"Attached to defendant's Motion for Reconsideration dated November 17, 1998 are xerox copies of OR Nos. 8128693, 3078792, and 7403620, showing its payments of the appellate docket and other lawful

fees on November 13, 1998. Obviously, such payments were made only after defendant's receipt of the resolution of November 5, 1998. Not being in accord with Section 4 of Rule 41, which requires payment

of the docket and other lawful fees within the period to appeal, the payments made by defendant on November 13, 1998 did not cure the failure to perfect an appeal.

WHEREFORE, the motion for reconsideration is hereby DENIED for lack of merit.

SO ORDERED."3

Hence, the instant recourse to this Court.

Petitioner contends that an appeal is perfected by the mere filing of a Notice of Appeal. The payment of the docket fee, not being necessary for its perfection, payment should be made only when directed by the court concerned. The Court of Appeals should have liberally interpreted the Rules in keeping with

the principle of procedural due process.

Respondent counters that the Court of Appeals did not err when it dismissed petitioner's appeal considering that an appeal fee must be paid within the time for perfecting an appeal.

Petitioner's contention is bereft of merit.

The right to appeal is not a natural right or a part of due process; it is merely a statutory privilege and may be exercised only in the manner and in accordance with the provisions of law.4 Thus, one who

seeks to avail of the right to appeal must strictly comply with the requirements of the rules,5 and failure to do so leads to the loss of the right to appeal.

Rule 41, Section 4 of the 1997 Rules of Civil Procedure, as amended, provides:

"SEC. 4. Appellate court docket and other lawful fees. – Within the period for taking an appeal, the appellant shall pay to the clerk of the court which rendered the judgment or final order appealed from, the full amount of the appellate court docket and other lawful fees. Proof of payment of said fees shall

be transmitted to the appellate court together with the original record or the record on appeal.

Failure to pay the appellate court docket and other lawful fees on time is a ground to dismiss the appeal."

The "period for taking an appeal" is fixed by both statute and procedural rules. Batas Pambansa Blg. 129, as amended, provides:

"SEC. 39. Appeals. – The period for appeal from final orders, resolutions, awards, judgments, or decisions of any court in all cases shall be fifteen (15) days counted from the notice of the final order,

resolution, award, judgment, or decision appealed from: Provided, however, That in habeas corpus cases, the period for appeal shall be forty-eight (48) hours from the notice of the judgment appealed

from. x x x"

Section 3, Rule 41, of the same Rules state:

"SEC. 3. Period of ordinary appeal. - The appeal shall be taken within fifteen (15) days from notice of the judgment or final order appealed from. Where a record of appeal is required, the appellant shall file a

notice of appeal and a record on appeal within thirty (30) days from notice of the judgment or final order. x x x"

In the instant case, petitioner received a copy of the Decision of the trial court on March 3, 1998.6 Accordingly, it had, pursuant to Section 3, Rule 41, until March 18, 1998 within which to perfect

its appeal by filing within that period the Notice of Appeal and paying the appellate docket and other legal fees. While petitioner filed the Notice of Appeal on March 9, 1998, or within the reglementary

period, however, it paid the required docket fees only on November 13, 1998, or late by 7 months and 25 days.

The mere filing of the Notice of Appeal is not enough, for it must be accompanied by the payment of the correct appellate docket fees.7Payment in full of docket fees within the prescribed period is

mandatory.8 It is an essential requirement without which the decision appealed from would become final and executory as if no appeal had been filed. Failure to perfect an appeal within the prescribed

period is not a mere technicality but jurisdictional and failure to perfect an appeal renders the judgment final and executory.9

In Guevarra vs. Court of Appeals,10 where the docket fees were not paid in full within the prescribed period of fifteen (15) days but were paid forty-one (41) days late due to "inadvertence, oversight, and

pressure of work," we held that the Court of Appeals correctly dismissed the appeal. In Lee vs. Republic of the Philippines,11 where half of the appellate docket fee was paid within the prescribed period, while the other half was tendered after the period within which payment should have been made, we ruled that

no appeal was perfected. Clearly, where the appellate docket fee is not paid in full within the reglementary period, the decision of the trial court becomes final and no longer susceptible to an

appeal.12 For once a decision becomes final, the appellate court is without jurisdiction to entertain the appeal.13

We thus hold that the Court of Appeals correctly dismissed petitioner's appeal. Under Section 1, Rule 50, of the 1997 Rules of Civil Procedure, as amended, one of the grounds for dismissal of an appeal is

failure of the appellant to pay the docket and other lawful fees.

We note that petitioner's counsel made the following admissions in the petition filed before us:Republic of the Philippines

SUPREME COURTManila

THIRD DIVISION

G.R. No. 138495             December 9, 2004

ANTONIO BORBON, as represented by his brother CANDIDO BORBON, Guardian Ad Litem, petitioners, 

vs.THE COURT OF APPEALS, ERNESTO CATINDIG, SPOUSES RENATO SITAY and PRINCESITA

O. SITAY, and AMPARO INVESTMENT CORP., respondents.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

For review on certiorari are two Resolutions1 of the Court of Appeals in CA-G.R. CV No. 57392, entitled "Antonio Borbon, represented by Candido Borbon, Guardian Ad Litem, Plaintiff-Appellant,

versus Ernesto Catindig, Sps. Renato and Princesita Sitay, Amparo Investment Corp., represented by its President, Guillermo B. Francisco, Defendants-Appellees."

The factual antecedents of this case are:

Antonio Borbon, petitioner, represented by his brother Candido Borbon, his guardian ad litem, is an incompetent, having been found to be suffering from chronic schizophrenia by the then Court of First

Instance (CFI) of Rizal in Sp. Proc. No. 924 on January 29, 1957. The Philippine National Bank (PNB) was appointed as his guardian. At that time, he was the owner of a 277-square meter lot in Makati City covered by Transfer Certificate of Title (TCT) No. 49221 issued on January 29, 1957 by the Registry of

Deeds of Rizal.

On September 19, 1957, the CFI issued an Order declaring petitioner competent and terminating PNB's guardianship over him. On July 7, 1958, this Order was duly annotated on petitioner's T.C.T. On the

same day, he sold one-half (½) of his lot to Mariano Sitay.

On February 7, 1978, Mariano had his ½ portion subdivided into two lots: Lot 8-A and Lot 8-B. He sold Lot 8-A to respondent Renato Sitay who mortgaged the same to respondent Amparo Investment

Corporation. Later, Mariano also sold his remaining lot, Lot 8-B, to respondent Ernesto Catindig.

On May 23, 1997, petitioner, through his brother, Candido Borbon, filed with the Regional Trial Court, Branch 145, Makati City a complaint for reconveyance of property against spouses Renato and

Princesita Sitay, Amparo Investment Corporation and Ernesto Catindig, docketed as Civil Case No. 97-1135. Petitioner, in his complaint, alleged that the contracts of sale and mortgage of the subject property are all void because of lack of consent on his part as he was then suffering from acute schizophrenia. On

June 9, 1997, the trial court appointed Candido Borbon as petitioner's guardian ad litem.

Amparo Investment Corporation filed a motion to dismiss the complaint on the grounds of lack of sufficient cause of action and prescription.

In a Resolution dated September 24, 1997, the trial court granted the motion, holding that the action for reconveyance has prescribed.

On October 11, 1997, petitioner interposed an appeal to the Court of Appeals, docketed as CA-G.R. CV No. 57392.

On May 11, 1998, petitioner received a copy of the Order of the Court of Appeals requiring him to file the appellant's brief within forty-five (45) days from notice.

Records show that petitioner had up to June 25, 1998 within which to file the required brief.

On June 23, July 24 and August 15, 1998, petitioner filed separate motions for extension, or a total of 60 days, within which to file the appellant's brief.

On September 22, 1998, the Court of Appeals issued a Resolution allowing appellant to file his brief until September 7, 1998.

On December 9, 1998, the Court of Appeals issued the following Resolution:

For failure of plaintiff-appellant to file his brief within the extended period, the instant appeal is hereby considered ABANDONED and accordingly DISMISSED pursuant to Sec. 1 (e), Rule 50 of the 1997

Rules of Civil Procedure.

SO ORDERED.2

Petitioner did not file a motion for reconsideration of this Order.

On February 16, 1999, petitioner filed by registered mail a motion to admit brief attached thereto. Counting from September 7, 1998, the last day allowed by the Appellate Court within which to file the

appellant's brief, its filing on February 16, 1999 was late by 159 days.

On March 9, 1999, the Court of Appeals issued a Resolution3 denying petitioner's motion to admit brief, thus:

It appearing that our resolution dated 09 December 1998 (dismissing the appeal) was returned to the Court unclaimed on 21 January 1999, for which reason a copy of the said resolution was re-sent to

counsel of the appellant by personal service which was received on 01 February 1999, so that the last day to file a motion for reconsideration of the resolution of dismissal was on 16 February 1999, but no motion for reconsideration was ever filed within the reglementary period, instead on 17 February 1999, plaintiff-appellant filed a motion to admit appellant's brief, it is self-evident that the said motion cannot

be entertained as the order of dismissal has become final and executory.

WHEREFORE, the motion to admit brief filed by appellant dated 15 February is hereby DENIED.

SO ORDERED.

The core issue here is whether the Court of Appeals acted with grave abuse of discretion in dismissing

the appeal for petitioner's failure to file the appellant's brief seasonably.

Section 3, Rule 41 of the 1997 Rules of Civil Procedure provides:

SEC. 3. Period of ordinary appeal. – The appeal shall be taken within fifteen (15) days from notice of judgment or final order appealed from. Where a record on appeal is required, the appellant shall file a

notice of appeal and a record on appeal within thirty (30) days from notice of the judgment or final order.

The period of appeal shall be interrupted by a timely motion for new trial or reconsideration. No motion for new trial or reconsideration shall be allowed.

The foregoing Rule should be read in consonance with Section 7, Rule 44, which states:

SEC. 7. Appellant's brief. – It shall be the duty of the appellant to file with the court, within forty-five (45) days from receipt of notice of the clerk that all the evidence, oral and documentary, are attached to

the record, seven (7) copies of his legibly typewritten, mimeographed or printed brief with proof of service of two (2) copies thereof upon the appellee.

Courts have the power and jurisdiction to grant an extension of time to perfect the appeal with the filing of the appellant's brief, but the motion seeking an extension of time to file an appellant's brief must be

filed within the period to perfect an appeal.

Here, the Appellate Court, upon petitioner's timely motion, allowed him to file the appellant's brief up to September 7, 1998. But he filed the same only on February 2, 1999, or after a lapse of 159 days.

We frown upon lawyer's practice of repeatedly seeking extensions of time to file pleadings and thereafter simply let the period lapse without submitting any pleading or even any explanation or

manifestation of their failure.4 Atty. Rogelio Padilla, the managing partner of the law firmhandling this case for petitioner, manifested that the reason for the failure of Atty. Samuel Marquez, the assigned

lawyer, to submit the required appellant's brief, "was the great burden of guilt that Atty. Marquez was carrying over the death of his wife – that rendered him confused and debilitated from performing his

work as a lawyer."

We fail to see any good reason why Atty. Marquez failed to transfer the case to another lawyer in the same office. We likewise fail to understand why the partners therein did not properly supervise and

monitor the work of Atty. Marquez. Indeed, the delay is, by any standard, simply inexcusable.

Rule 12.03 of the Code of Professional Responsibility provides that "A lawyer shall not, after obtaining extensions of time to file pleadings, memoranda or briefs, let the period lapse

without submitting the same or offering an explanation for his failure to do so."

Canon 18 likewise provides that "A lawyer shall serve his client with competence and diligence." And Canon 19 states that "A lawyer shall represent his client with zeal within the bounds of law."

In Galen vs. Paguirigan,5 we held:

"An attorney is bound to protect his client's interest to the best of his ability and with utmost diligence. A failure to file brief for his client certainly constitutes inexcusable negligence on his part. The

respondent has indeed committed a serious lapse in the duty owed by him to his client as well as to the

Court not to delay litigation and to aid in the speedy administration of justice."

Undoubtedly, petitioner's counsel failed to exercise due diligence in protecting the interest of his client, to the latter's prejudice. His lack of devotion to duty is so gross and palpable which warrants disciplinary

action.

WHEREFORE, the petition is DENIED. The assailed Resolutions of the Court of Appeals dated December 9, 1998 and March 9, 1999 in CA-G.R. CV No. 57392 are AFFIRMED. Costs against

petitioner.

Atty. Manuel Marquez, counsel for petitioner, is hereby required to show cause in writing, within ten (10) days from notice, why he should not be held administratively liable for his acts and omissions

described in this Decision.

SO ORDERED.

Panganiban, J., Chairman, Carpio Morales, and Garcia, JJ. concur.Corona, J. on leave.

Footnotes

1 Penned by Associate Justice Buenaventura J. Guerrero (ret.) and concurred in by Associate Justices Portia Aliño-Hormachuelos and Presbitero J. Velasco (now Court Administrator), Rollo at 23, 25.

2 Id. at 25.

3 Id. at 23.

4 Edrial vs. Quilat-Quilat, G.R. No. 133625, September 6, 2000, 339 SCRA 760, 770 citing Achacoso vs. Court of Appeals, 51 SCRA 424 (1973); Casals vs. Cusi, Jr., 52 SCRA 58 (1973).

5 Adm. Case No. 5558, March 7, 2002, 378 SCRA 527, citing Tan vs. Lapak,, 350 SCRA 74 (2001), with citations.

   

THIRD DIVISION 

 BIBLIA T. BANAGA,                                           G.R. No. 149051                    Petitioner,                                                                              Present:                 - versus -                                                QUISUMBING, J.,                                                                                      Chairperson,                                                                                      CARPIO,                                                                             CARPIO MORALES,                                                                             TINGA, and

HON. JOSE S. MAJADUCON,                             VELASCO, JR.,  JJ.Presiding Judge Regional Trial Court,                    Court, Branch XXIII, 11th JudicialRegion, General Santos City and                            Promulgated:CANDELARIO  S. DAMALERIO,                               Respondents.                                    June 30, 2006 x ------------------------------------------------------------------------------------------x  

D E C I S I O N  

TINGA,  J.:          

          This is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, praying for the

reversal of the Court of Appeals’ Decision in CA-G.R. SP No. 63375 promulgated on July 4, 2001.[1] The Court of

Appeals’ Decision dismissed Biblia T. Banaga’s petition for certiorari, prohibition and mandamus, which sought to

nullify three orders issued by the Regional Trial Court (RTC), Branch 23 of General Santos City, in connection with

the execution of the final judgment in G.R. No. 127941. 

The instant petition had its genesis from an action for redemption of a parcel of land situated in General

Santos City filed by petitioner Banaga against private respondent Candelario Damalerio before the RTC, Branch 23,

General Santos City. The trial court dismissed petitioner’s complaint, prompting her to elevate the matter to the

Court of Appeals which reversed the trial court and upheld petitioner’s right to redeem the property. [2] Private

respondent’s appeal from said decision via a petition for review on certiorari docketed as G.R. No. 103204 was

denied in this Court’s resolution dated February 19, 1992.[3]

 

However, petitioner failed to exercise her right to redeem within the given period. Private respondent

moved to declare the termination of the 30-day redemption period, but the trial court denied the same in an Order

issued on May 29, 1992.[4]  Thus, private respondent filed a petition for certiorari praying for the nullification of said

order. The Court of Appeals granted private respondent’s petition, prompting petitioner to appeal to this Court.   In

the Court’s resolution in G.R. No. 113534,[5] the Court denied petitioner’s appeal for lack of merit. The decision

became final and executory and a writ of execution issued as a consequence. However, the Register of Deeds

refused to issue a certificate of title in the name of private respondent. 

Litigation commenced once again when private respondent elevated the case to the Court of Appeals via a

petition for certiorari and mandamus.[6]  The Court of Appeals’ Decision,[7] which was affirmed by this Court in its

decision in G.R. No. 127941[8] promulgated on January 28, 1999, directed the Register of Deeds to issue certificates

of title in the name of private respondent and the trial court to issue a writ of execution and a writ of possession in

favor of respondent. The dispositive portion of the Court of Appeals’ decision, as affirmed by this Court, reads:

 WHEREFORE, in view of all the foregoing considerations, the petition is GRANTED.

Judgment is hereby rendered: 1)     setting aside the orders of the respondent judge dated January11, 1995 and March

29, 1996; 2)     declaring the title issued to Biblia Toledo-Banaga, Jovita Tan and to those other

subsequent transferee or transferees, if any, as null and void; 3)     ordering the Register of Deeds of General Santos City to issue new certificates of

title to Candelario Damalerio over the parcels of land in question; 4)                      ordering the respondent court to issue writ of execution for the

enforcement of this decision and of the decision in CA-G.R. SP No. 29868 (sic), as well as a writ of possession for the delivery to petitioner Damalerio of the physical possession of the parcels of land subject matter of this case.

  

  SO ORDERED.[9]

 

 

The records of the case were subsequently remanded to the trial court for execution of judgment. Thus,

on May 10, 1999, upon motion by private respondent, the trial court issued a writ of execution and a writ of

possession for the delivery of the subject property, denominated as Lot 2-G-2, to private respondent. The

corresponding certificate of title was also issued to private respondent in consonance with the final decision. Private

respondent was placed in possession of Lot 2-G-2, which he fenced with galvanized iron sheets. 

Controversy arose anew when private respondent moved for the issuance of a special order for demolition

of a structure alleged to be erected within Lot 2-G-2. Petitioner objected, claiming that the structure is situated

within Lot 2-G-1, the adjacent property retained and still owned by petitioner. The two lots were previously part of a

bigger parcel of land before its subdivision sometime in the 1960’s. To resolve the issue, the trial court directed both

parties to conduct a joint survey of the two lots. As the reports submitted by the two surveyors revealed conflicting

results, petitioner and private respondent jointly manifested that a relocation survey be made by the survey team

from the Department of Environment and Natural Resources (DENR). They further agreed before the trial court that

they will abide and honor the findings and recommendations of the survey team. [10]  Upon the trial court’s

order, Engr. Gerardo Dida of the DENR conducted a relocation survey on January 13 and 14, 2000. The report

submitted by Engr. Dida indicated that Lot 2-G-1 had encroached on private respondent’s Lot 2-G-2 by some 136

square meters. 

On March 13, 2000, petitioner filed an Urgent Omnibus Motion for the conduct of a verification survey. In

her motion, petitioner alleged that the survey conducted was incomplete and prayed that a verification survey be

conducted first beforeEngr. Dida is called to testify on the survey report. Without ruling on the petitioner’s motion,

on March 30, 2000, the trial court proceeded ex-parte in taking the testimony of Engr. Dida and directed both parties

to submit their respective memoranda.[11]

 

The trial court issued the first assailed order on August 4, 2000, approving the report submitted

by Engr. Dida. Petitioner filed a notice of appeal on the August 4, 2000 Order of the trial court but the same was

denied when the trial court issued the second assailed order on October 2, 2000. Petitioner moved for the

reconsideration of the October 2, 2000 Order but the trial court denied the motion through the third assailed order

of February 9, 2001. 

Thereafter, petitioner instituted a special civil action for certiorari, prohibition and mandamus with a prayer

for the issuance of a writ of preliminary injunction with the Court of Appeals, seeking the nullification of the

aforesaid subject orders of the trial court and the approval of petitioner’s notice of appeal. Petitioner questioned the

trial court’s dismissal of its notice of appeal on the ground that the trial court has the ministerial duty to approve the

notice of appeal duly filed on time and to transmit the records of the case to the appellate court. On March 13, 2001,

the Court of Appeals issued a temporary restraining order to prevent the execution of the assailed orders and the

demolition of the structures alleged to be encroaching upon private respondent’s property. 

On July 4, 2001, the Court of Appeals dismissed the petition on the ground that petitioner failed to show

that the trial court committed grave abuse of discretion in approving the survey report submitted by Engr. Dida.

Moreover, it ruled that the resolution of the boundary dispute was an incident of the execution proceedings; thus, no

appeal may be taken from the trial court’s order approving the survey report in accordance with Section 1(f), Rule

41[12] of the Rules of Court. The appellate court also declared petitioner to be bound by her manifestation to respect

the survey report. In any case, petitioner should have first moved for the reconsideration of the order approving the

survey report instead of immediately filing a notice of appeal, said the appellate court. 

Not satisfied with the Court of Appeals’ Decision, petitioner comes to this Court, imputing the following

errors: 

1. The Honorable Court of Appeals seriously erred when It ruled that the trial judge did not commit any grave abuse of discretion in issuing the challenged Order dated 04 August 2001 and when it denied due course to petitioner’s petition and upheld the denial by the trial court of petitioner’s Notice of Appeal from its assailed Order.

 2. The Honorable Court of Appeals seriously erred when it held that petitioner had

acquiesced to the execution of the assailed Order, hence, he is no longer allowed to appeal from such order.

 3. The Honorable Court of Appeals seriously erred when it held that petitioner

was estopped from assailing the challenged Order.[13]

 

 

The instant petition poses the fundamental issue of whether or not the trial court correctly denied

petitioner’s notice of appeal notwithstanding petitioner’s allegation that the Order dated August 4, 2000 varied the

terms of the final judgment in G.R. No. 127941. 

The Court of Appeals ruled that the determination of the boundary limits of Lot 2-G-2 was a matter

incidental to the execution of the decision in the main case; hence, the trial court’s order of August 4, 2000, which

approved the survey report submitted by Engr. Dida, was not appealable in view of the proscription against appeal

from an order of execution. In like manner, private respondent contends that with the adoption of the 1997 Rules of

Civil Procedure, only the remedy of a special civil action of certiorari is available to a party prejudiced by an

improper or irregular execution. 

The Court does not agree. 

Even prior to the promulgation of the 1997 Rules of Civil Procedure, the rule that no appeal lies from an

order or writ directing the execution of a final judgment, for otherwise a case will not attain finality, is not absolute

since a party aggrieved by an improper or irregular execution of a judgment is not without a remedy. Thus,

in Limpin v. Intermediate Appellate Court,[14] the Court enumerated the exceptional circumstances where a party

may elevate the matter of an improper execution for appeal, to wit:

 There may, to be sure, be instances when an error may be committed in the course of

execution proceedings prejudicial to the rights of a party. These instances, rare though they may be, do call for correction by a superior court, as where –

 1)     the writ of execution varies the judgment;

 2)     there has been a change in the situation of the parties making execution inequitable

or unjust; 

3)     execution is sought to be enforced against property exempt from execution; 

4)     it appears that the controversy has never been subject to the judgment of the court;5)     the terms of the judgment are not clear enough and there remains room for

interpretation thereof; or 

6)     it appears that the writ of execution has been improvidently issued, or that it is defective in substance, or is issued against the wrong party, or that the judgment debt has been paid or otherwise satisfied, or the writ was issued without authority;[15]

  

In these exceptional circumstances, considerations of justice and equity dictate that there be some mode

available to the party aggrieved of elevating the question to a higher court. That mode of elevation may be either by

appeal (writ of error or certiorari), or by a special civil action of certiorari, prohibition, or mandamus.[16]

 

The aforementioned pronouncement has been reiterated in cases subsequent to the adoption of the 1997

Rules of Civil Procedure.[17] The Court finds no sound justification to abandon the aforequoted pronouncement

insofar as it recognizes the filing of an ordinary appeal as a proper remedy to assail a writ or order issued in

connection with the execution of a final judgment, where a factual review in the manner of execution is called for to

determine whether the challenged writ or order has indeed varied the tenor of the final judgment. 

To rule that a special civil action for certiorari constitutes the sole and exclusive remedy to assail a writ or

order of execution would unduly restrict the remedy available to a party prejudiced by an improper or illegal

execution. A special civil action for certiorari is not a mode of appeal where the appellate court reviews the errors of

fact or law committed by the lower court. The issue in a special civil action for certiorari is whether the lower court

acted without or in excess of jurisdiction or with grave abuse of discretion.[18]  

In the instant case, an ordinary appeal is the more proper and adequate remedy to address the factual

allegations raised by petitioner. Petitioner’s vigorous objection to the survey report centered on her position that it

would alter the present boundaries and result to awarding to private respondent a portion of Lot 2-G-1 belonging to

her. In particular, petitioner stressed that the survey conducted was inadequate as it was limited only to the

properties registered in the name of private respondent and it did not indicate the relative positions of the corners of

the other adjacent lots in relation to the corners of Lot 2-G-2. 

From a perusal of the survey report it appears that the relocation of the boundaries of  Lot 2-G-2 would

reposition said lot to the east by a few meters, resulting in the overlapping of its eastern boundaries with that

of Lot 2-G-1, the adjacent lot belonging to petitioner. Thus, petitioner is assailing the accuracy of the survey report

as it would result in either diminishing the area of Lot 2-G-1 or moving the area of said lot eastward so as to occupy

the adjoining street. The survey report appears to relocate also the boundary limit of private respondent’s Lot 2-G-2

also eastward from the direction of the other street. The determination of the correctness of the survey findings in

relation to the boundary limits of Lot 2-G-2 and Lot 2-G-1 is ultimately a factual question. Not only that, the effect

of the survey findings on the boundaries of the other adjacent lots not subject of the main case becomes an issue.

The technical findings of the surveyor as well as the trial court’s appreciation thereof must undergo the scrutiny of

the appellate process. The trial court’s order adopting and approving the survey report cannot be regarded as final

and unappealable. 

In addition, allegations of fraud, involving alterations in the technical descriptions used as basis of the

survey, were raised by petitioner. The question of whether or not the trial court committed an error in judgment

insofar as it upheld the accuracy of the survey report in light of petitioner’s allegations can be resolved only by way

of ordinary appeal. 

Therefore, the more appropriate remedy is an ordinary appeal instead of a petition for certiorari, contrary to

the stance of private respondent. Raised by petitioner is the factual issue of discrepancy or alterations in the lot data

computations used as basis for the survey. This calls for a review of the case records. 

It was also error for the appellate court to rule as it did that petitioner should have first sought clarification

with the trial court or moved for the reconsideration of the August 4, 2000 Order before filing the notice of appeal in

order to clarify the import of the court’s approval of the survey report in relation to the writ of execution issued.

From a reading of the August 4, 2000 Order, there is no question that the trial court found the survey report accurate

despite petitioner’s allegation that it was incomplete and not based on authentic survey records with the DENR.

Besides, petitioner had already raised her objections in the Urgent Omnibus Motion and extensively discussed them

in her memorandum. The trial court’s failure to rule on petitioner’s Urgent Omnibus Motion and its approval of the

survey report only indicate that the trial court found petitioner’s arguments to be without merit. A motion for

reconsideration or clarification would only be repetitious of petitioner’s allegations and arguments and come out as

useless in the trial court’s reckoning. Moreover, a motion for reconsideration is not required before appealing a

judgment or final order. 

While it is correct that petitioner bound herself to abide by the findings of the survey team, the waiver does

not include future fraud. Responsibility arising from fraud is demandable in all obligations. Any waiver of an action

for future fraud is void.[19] Petitioner brought up allegations of discrepancy and alterations in the lot data

computations used in the survey when compared to data found in DENR records. Petitioner’s waiver cannot be

taken to cover allegations of fraud. 

All given, the Court of Appeals erred in ruling that the trial court did not commit grave abuse of discretion

in dismissing petitioner’s notice of appeal.  

Private respondent contends that the petition should be dismissed for violating Section 11, Rule 13 of the

Rules of Court. In his affidavit of service, petitioner’s counsel stated that copies of the petition were furnished the

parties/counsel via registered mail due to the distance of the offices of petitioner and private respondent’s counsels.

According to private respondent, said statement is false because the distance between the offices is only about 15

meters. 

In adjudging the plausibility of an explanation, a court shall likewise consider the importance of the subject

matter of the case or the issues involved therein, and the prima facie merit of the pleading sought to be expunged for

violation of Section 11.[20] The basis of allowing the appellate review of the trial court’s order approving the survey

is to afford petitioner the opportunity to prove her claim that she bears the risk of being illegally deprived of a

property belonging to her. Thus, the dismissal of this petition on a mere technicality will ignore the constitutional

provision against depriving a person of his property without due process of law. Besides, the proximity between the

offices of opposing counsel had not been clearly established. The Rules shall be liberally construed in order to

promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding.[21]       

WHEREFORE, the instant petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP

No. 63375 is REVERSED and SET ASIDE. A new judgment is entered NULLIFYING the orders dated February 9,

2001 and October 2, 2000 of the Regional Trial Court, Branch 23, General Santos City.

 

The trial court is directed to give due course to petitioner’s appeal of its Order dated August 4, 2000 and

transmit the records of the case to the Court of Appeals after payment of appellate docket and other lawful fees with

deliberate dispatch. 

SO ORDERED.

           DANTE O.

TINGA                                                               Associate Justice  

WE CONCUR:    

LEONARDO A. QUISUMBINGAssociate Justice

Chairperson         ANTONIO T. CARPIO                 CONCHITA CARPIO MORALES           Associate Justice                                     Associate Justice  

  

PRESBITERO J. VELASCO, JR.Associate Justice

   

     

ATTESTATION 

           I attest that the conclusions in the above Decision had been reached in consultation before the case was

assigned to the writer of the opinion of the Court’s Division.                                                                                        LEONARDO A. QUISUMBING                                                            Associate Justice                                                   Chairperson, Third Division    

CERTIFICATION  

          Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, it is

hereby certified that the conclusions in the above Decision had been reached in consultation before the case was

assigned to the writer of the opinion of the Court’s Division.                                                            REYNATO S. PUNO                                                           Acting Chief Justice                                                           

 

 [1]Penned by Bernardo P. Abesamis, J., Acting Chairman, and concurred in by Eliezer R. De Los Santos

and Remedios Salazar-Fernando, JJ.; Rollo, pp. 35-45. [2]Records, p. 225. [3]Candelario Damalerio v. Court of Appeals, et al., February 19, 1992; Records, p. 222. [4]Records, p. 262. [5]Biblia Toledo-Banaga v. Court of Appeals, et al., May 11, 1994; Records, p. 996. [6]Candelario Damalerio v. Hon. Jose Orlino, et al.; CA-G.R. SP No. 40348; Records, p. 1248. [7]CA-G.R. SP No. 40348, November 7, 1996; Records, pp. 1271-1297. [8]Toledo-Banaga v. Court of Appeals, 361 Phil. 1006 (1999). 

 [9]Id. at 1014. [10]CA decision, p. 8; rollo, p. 37. [11]Id. [12]Section 1. Subject of Appeal. – An appeal may be taken from a judgment or final order that completely

disposes of the case, or of a particular matter therein when declared by these Rules to be appealable. No appeal may be taken from: x x x

     (f) An order of execution; x x x x.

  [13]Rollo, p. 12.  [14]G.R. No. L-70987, January 30, 1987, 147 SCRA 516.  [15] Id. at 479. [16]Id. [17]Paulino v. Court of Appeals, et al, G.R. No. 110271, February 28, 1994, 230 SCRA 475; Reburiano v.

Court of Appeals, 361 Phil. 294 (1999);  Baluyut v. Guiao, 373 Phil. 1013 (1999).  [18]Yasuda v. Court of Appeals, 386 Phil.  594, 602 (2000). [19]CIVIL CODE, Art.  1171.  [20]Solar Team Entertainment, Inc. v. Ricafort, 355 Phil.  404, 414 (1998). [21]RULES OF COURT, Rule 1, Sec.  6.