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Xerxes Abadiano v. Spouses Martir (July
31, 2008)
Subject: Property, Evidence1
Facts: Inocentes Banares and the heirs of
his wife, Feliciana Villanueva executed an
Agreement of Partition dated June 1, 1922
over Lot No. 1318. The lot was partitionedand distributed to the following: (1)
Demetrio Banares (Lot No. 1318-A), (2)
Ramon and David Abadiano –grandchildren
of Inocentes and Feliciana (Lot No. 1318-B)
and (3) Amando Banares (Lot No. 1318-C).
The partition is embodied in a notarized
Deed of Partition. In 1923, an Original
Certificate of Title (OCT) No. 20641 was
issued in the name of the spouses. In 1939,
David Abadiano, who was absent during theexecution of the Agreement of Partition,
executed a Deed of Confirmation
acknowledging and ratifying the document
of partition. OCT No. 20641 was
administratively reconstituted in 1962 and in
lieu thereof, OCT No. RO-8211 was issued
over Lot No. 1318, still in the name of the
spouses. The Agreement of Partition and the
Deed of Confirmation were annotated at the
back of the OCT. In 1957, Demetrio sold his
share to his son Leopoldo. The latter then
filed a petition praying for confirmation of
the Agreement and the Deed of Confirmation
and the Deed of Sale between him and his
father, and for the issuance of a new title
over the property. The Court ordered the
issuance of a Transfer Certificate of Title
(TCT) in the name of Leopoldo, Amando, and
Ramon and David. Petitioner insists that this
is the valid and subsisting title over the
property and there was no other sale toanyone.
Respondents allege however that prior to
the issuance of the TCT, Ramon for himself
and on behalf of David, had already sold
their rights and interests over Lot No. 1318-
1 I won’t be discussing evidence. Wala akong
karapatan. The case touches on Rule 130,
Section 3
C to Victor Garde, as evidenced by a
notarized document of sale (Compra Y
Venta) dated June 3, 1922. They further
allege that from the time of sale, Victor
Garde and his heirs were in continuous,
public, peaceful and uninterrupted
possession and occupation in the concept of
an owner of the Lot. Victor’s heirs sold thesame to Jose Garde who in turn sold it to
Lolita Martir in 1979. Alleging that the
Abadianos entered the property and
harvested sugarcane from it, the spouses
filed an Action to Quiet Title and/or Recovery
of Possession with Damages in 1982. The
trial court ruled for the Martirs, holding that
the spouses and their predecessors-in-
interest have been in possession of the
property for 60 years and the Abadianos
therefore were guilty of laches. CA affirmed.
Hence, this Petition for Review on Certiorari.
Issue: WON the petitioner is guilty of laches
Held: No. Under the Property Registration
Decree, no title to registered land in
derogation of the title of the registered
owner shall be acquired by prescription or
adverse possession. Nonetheless, even if a
Torrens title is indefeasible and
imprescriptible, the registered landowner
may lose his right to recover the possession
of his registered property by reason of
laches. Laches has been defined as
neglect or omission to assert a right,
taken in conjunction with lapse of time
and other circumstances causing
prejudice to an adverse party. The four
basic elements are: 1) conduct on the part
of the defendant, or of one under whom he
claims, giving rise to the situation of whichcomplaint is made and for which the
complaint seeks a remedy; 2) delay in
asserting the complainant’s rights, the
complainant having had knowledge or notice
of the defendant’s conduct and having been
afforded an opportunity to institute suit; 3)
lack of knowledge or notice on the part of
the defendant that the complainant would
assert the right on which he bases his suit;
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and 4) injury or prejudice to the defendant in
the event relief is accorded to the
complainant or the suit is not held to be
barred.
Petitioner had reasonable ground to believe
that the property, being still in the name of
his predecessor in interest, continued to be
theirs, especially considering that the
annotation of the purported sale was done
only in 1982. That the petitioner and his co-
heirs waited until the death of Amando to try
and occupy the land is understandable since
any action may sow dissent within the
family. In determining whether a delay
in seeking to enforce a right
constitutes laches, the existence of a
confidential relationship between the
parties is an important circumstancefor consideration, a delay under such
circumstances not being so strictly
regarded as where the parties are
strangers to each other. The doctrine of
laches is not strictly applied between
near relatives, and the fact that parties
are connected by ties of blood or
marriage tends to excuse an otherwise
unreasonable delay. In addition, several
other factors militate against the finding of laches on the part of the petitioner: a) no
annotation was made of Compra Y Venta on
the OCT or the TCT; b)neither respondents
nor any of their predecessors in interest
participated in any of the proceedings for
the issuance of the OCT or the TCT; and c)
the TCT bears out that the fact that the
purported Compra Y Venta was annotated
thereon only in 1982. It is most telling that
respondents, have themselves failed to have
the same property transferred in their name
or even only to have the sale annotated on
the title of the property.
Accessories Specialist Inc., a.k.a. Arts
21 Corporation vs. Alabanza
July 23, 2008
Nachura, J.
Labor Law. Promissory estoppel may arise
from the making of a promise, even though
without consideration, if it was intended that
the promise should be relied upon, as in fact
it was relied upon, and if a refusal to enforce
it would virtually sanction the perpetration
of fraud or would result in other injustice.
The principle of promissory estoppel is arecognized exception to the three-year
prescriptive period enunciated in Article 291
of the Labor Code.
Labor Law. The posting of a bond is
indispensable to the perfection of an appeal
in cases involving monetary awards from the
decision of the Labor Arbiter. The filing of the
bond is not only mandatory but also a
jurisdictional requirement that must be
complied with in order to confer jurisdictionupon the NLRC.
Facts:
On September 27, 2002, respondent
Alabanza filed a complaint against
petitioners Arts 21 and Hashimoto for and in
behalf of her husband for non-payment of
salaries, separation pay and 13th month pay.
Respondent’s husband was the Vice-President, Manager and Director of Arts 21
and had been with the company from 1975
to 1997. He was compelled by the owner,
Hashimoto, to file his involuntary resignation
on October 17, 1997 on the ground that Arts
21 allegedly suffered losses. Respondent’s
husband demanded payment of his money
claims upon resignation but was told that
rank and file employees will be paid first and
thus waited for his turn. Respondent’s
husband made several demands but Arts 21
just kept on assuring him that he will be paid
his money claims. Respondent’s husband
died on August 5, 2002 with his claims still
unpaid.
Petitioners invoke Art. 291 of the
Labor Code and contend that respondent’s
husband voluntarily resigned in October,
1997, thus the cause of action has already
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prescribed since the case was filed in 2002
only, beyond the three-year-period within
which money claims should be filed.
The Labor Arbiter rendered a decision
ordering petitioner to pay respondent over
P4M. Petitioners filed an appeal along with a
motion to reduce bond, attaching receipts
for cash bond amounting to P290K and
appeal fee for P170.00. The motion was
denied and petitioners were given 10 days
within which to file the required bond.
Petitioners filed a motion for reconsideration
which the NLRC denied ordering the
dismissal of the appeal for non-perfection
thereof due to non-compliance with the bond
requirement. The resolution became final
and executory and a writ of execution was
issued by the Labor Arbiter upon motion byrespondent. Petitioners filed a petition for
certiorari with the Court of Appeals praying
for the issuance of a TRO and a writ of
preliminary injunction. The petition was
dismissed.
Issue No. 1:
WON the cause of action of
respondent has already prescribed/
Held: NO.
Ratio:
Based on the findings of facts of the
Labor Arbiter, it was petitioner Arts 21 which
was responsible for the delay in the
institution of the complaint. When
petitioner’s husband filed his resignation he
immediately asked for the payment of his
money claims. However, the management of Arts 21 promised him that he would be paid
immediately after the claim of the rank-and-
file employees had been paid. Jones relied
on this representation.
Promissory estoppel may arise from
the making of a promise, even though
without consideration, if it was intended that
the promise should be relied upon, as in fact
it was relied upon, and if a refusal to enforce
it would virtually sanction the perpetration
of fraud or would result in other injustice.
The principle of promissory estoppel is a
recognized exception to the three-year
prescriptive period enunciated in Article 291
of the Labor Code.
In order to make out a claim of
promissory estoppel, a party bears the
burden of establishing the following
elements: (1) a promise was reasonably
expected to induce action or forbearance;
(2) such promise did, in fact, induce such
action or forbearance; and (3) the party
suffered detriment as a result. All the
requisites are present in this case. The
Court, therefore, finds ample justification not
to follow the prescriptive period imposed
under Art. 291 of the Labor Code. Greatinjustice will be committed if respondent’s
claims will be brushed aside on a mere
technicality, especially when it was
petitioner’s own action that prevented
respondent from interposing the claims
within the required period.
Issue No. 2:
WON the posting of the complete
amount of the bond in an appeal from thedecision of the Labor Arbiter to the NLRC is
an indispensable requirement for the
perfection of the appeal despite the filing of
a motion to reduce the amount of the appeal
bond.
Held: YES.
Ratio:
Article 223 of the Labor Codemandates that in case of a judgment of the
Labor Arbiter involving a monetary award,
an appeal by the employer to the NLRC may
be perfected only upon the posting of a cash
or surety bond issued by a reputable
bonding company duly accredited by the
Commission, in the amount equivalent to the
monetary award in the judgment appealed
from.
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The posting of a bond is indispensable
to the perfection of an appeal in cases
involving monetary awards from the decision
of the Labor Arbiter.
The filing of the bond is not only
mandatory but also a jurisdictional
requirement that must be complied with in
order to confer jurisdiction upon the NLRC.
Non-compliance therewith renders the
decision of the Labor Arbiter final and
executory. This requirement is intended to
assure the workers that if they prevail in the
case, they will receive the money judgment
in their favour upon the dismissal of the
employer’s appeal. It is intended to
discourage employers from using an appeal
to delay or evade their obligation to satisfy
their employees’ just and lawful claims.
The failure of petitioners to comply
with the requirement of posting a bond
equivalent in amount to the monetary award
is fatal to their appeal. Section 6 of the New
Rules of Procedure of the NLRC mandates,
among others, that no motion to reduce
bond shall be entertained except on
meritorious grounds and upon the posting of
a bond in a reasonable amount in relation to
the monetary award. The NLRC has full
discretion to grant or deny their motion to
reduce the amount of the appeal bond. The
finding of the NLRC that petitioners did not
present sufficient justification for the
reduction thereof is generally conclusive
upon the Court absent a showing that the
denial was tainted with bad faith.
Furthermore, appeal is not a
constitutional right, but a mere statutoryprivilege. Parties who seek to avail
themselves of it must comply with the
statutes or rules allowing it.
Petition DENIED.
Associated Bank (United Overseas Bank
[Phils.] v. Spouses Pronstroller
(July 14, 2008)
Subjects: Agency and Partnership,
Torts and Damages
Facts: In 1988, the spouses Vaca executed a
real estate mortgage in favor of petitioner
bank over their parcel of land in Quezon City.
For failure of the spouses Vaca to pay theirobligation, the subject property was sold at
public auction with the petitioner as the
highest bidder. TCT was issued to petitioner
The spouses Vaca however commenced an
action for the nullification of the real estate
mortgage and the foreclosure sale
Petitioner filed a petition for a writ o
possession. The cases reached the SC, which
eventually decided that the petitioner has a
right to possess the property.
During their pendency however, the
petitioner advertised the property for sale
The spouses Pronstroller offered to purchase
the property. Said offer was made through
Atty. Soluta, Jr., the bank’s VP, Corporate
Secretary and a member of its Board of
Directors. Respondents paid P750th or 10%
of the purchase price. Petitioner, through
Atty. Soluta, and respondents executed a
Letter-Agreement containing the terms andconditions of the sale. One of the terms was
that the Pronstrollers have to make 10%
deposit and balance of P6.75M to be
deposited under escrow agreement. This
was modified by another letter-agreement
which allowed the spouses to pay the
balance of the purchase price after the SC
resolution of the cases.
By the end of 1993, petitioner reorganized
its management and the new management
discovered that the spouses failed to pay the
balance of the purchase price. The bank
then rescinded the sale and suggested that
spouses come up with a new proposal. The
parties failed to reach an agreement and the
spouses informed the bank that they would
be enforcing their second Letter-Agreement
Petitioner countered that it was not aware of
the existence of such agreement and Atty
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Facts
The controversy commenced with the filing
of an ejectment complaint by petitioner
Ayson against respondent-spouses Paragas
on the basis that petitioner is the registered
owner of the property being occupied by therespondent-spouses who, according to
petitioner, are just occupying the said land
through the latter’s tolerance without rent.
MTCC decided in favor of petitioner. RTC
affirmed the MTCC Decision. During the
pendency of the appeal with the RTC,
respondent-spouses filed against petitioner a
complaint for declaration of nullity of Deed
of Sale, in effect questioning OWNERSHIP.
Respondent Felix Paragas (husband) allegedthat Ayson’s father made him sign a Deed of
Absolute Sale over Maxima’s (wife) property
under threat that Felix will be incarcerated.
RTC rendered its decision in favor of
respondent-spouses declaring the Deed of
Absolute Sale as an equitable mortgage.
Issue 1
WON the decision of the court in the
ejectment case where ownership was raised
as defense by the Spouses Paragas, is
conclusive on the issue of ownerhip such
that the complaint for declaration of nullity
of Deed of Sale by the respondent-spouses is
barred.
Decision 1
No. Action by the respondent-spouse is not
barred.
Ratio 1
It must be remembered that in ejectment
suits the issue to be resolved is merely the
physical possession over the property, i.e.
possession de facto and not possession de
jure, independent of any claim of ownership
set forth by the party-litigants. Should the
defendant in an ejectment case raise the
defense of ownership in his pleadings and
the question of possession cannot be
resolved without deciding the issue o
ownership, the issue of ownership shall be
resolved only to determine the issue of
possession. The judgment rendered in such
an action shall be conclusive only with
respect to physical possession and shall in
no wise bind the title to the realty o
constitute a binding and conclusiveadjudication of the merits on the issue of
ownership. Therefore, such judgment shal
not bar an action between the same parties
respecting the title or ownership over the
property, which action was precisely
resorted to by respondent-spouses in this
case.
Issue 2
WON the Deed of Absolute Sale is an
equitable mortgage.
Decision 2
Yes. It is an equitable mortgage; hence, the
property is still under the ownership of the
spouses.
Ratio 2
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The Civil Code enumerates the cases in
which a contract, purporting to be a sale, is
considered only as a contract of loan
secured by a mortgage as per Article 1604 in
relation Article 1602. In this case, the
evidence before the RTC had established
that the possession of the subject property
remained with respondent-spouses despite
the execution of the Deed of Absolute Sale.
Issue 3
WON the Deed of Absolute Sale was
executed through fraud, making the saidcontract merely voidable, and the action to
annul voidable contracts based on fraud
prescribed in four (4) years from the
discovery of fraud.
Decision 3 and Ratio 3
An equitable mortgage is a voidablecontract. As such, it may be annulled within
four (4) years from the time the cause of
action accrues. This case, however, not only
involves a contract resulting from fraud, but
covers a transaction ridden with threat,
intimidation, and continuing undue influence
which started when petitioner’s father Thus,
the four-year period should start from the
time the defect in the consent ceases.
Philippine Veterans Bank vs Monillas
Nachura – 2008
Topic: Effects of Prior Registration of
Mortgage shall Prevail over the Belated
Annotation of a Lis Pendens.
Benjamin Monillas executed a deed of sale of
his share over the property to his brother,
Ireneo. Ireneo then caused the transfer of
the title in his name. Ireneo mortgaged
twenty-two (22) lots to petitioner Philippine
Veterans Bank (PVB). Benjamin Monillas filed
for the nullification of the deed of sale and
for the recovery of the property, which the
RTC decided on his favor; hence, he filed for
the declaration of the nullity of the titles
issued in PVB's name. He caused the
annotation of notices of lis pendens relating
to the said case on the titles of the lots
While the case remained pending, PVB
foreclosed the mortgage, PVB was the
highest bidder Benjamin Monillas,
The RTC ruled against PVB. The RTC
rationalized that while the annotation of the
notices of lis pendens succeeded the
registration of the mortgage, still the effect
of the notices was that PVB acquired
knowledge of an impediment against its
interest, and as a matter of fact, PVB ignored
the notices and slept on its rights, as it did
not intervene in the said civil case.
Issue
WON the prior registered mortgage and the
already concluded foreclosure proceedings
should prevail over the subsequent
annotation of the notices of lis pendens on
the lot titles.
Decision
Prior registered mortgage of PVB and the
foreclosure proceedings already conducted
prevail over Benjamin Monilla's subsequent
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annotation of the notices of lis pendens on
the titles to the property.
Ratio
A prior registration of a lien creates a
preference; hence, the subsequent
annotation of an adverse claim cannot
defeat the rights of the mortgagee, or the
purchaser at the auction sale whose rights
were derived from a prior mortgage validly
registered. A contrary rule will make a prior
registration of a mortgage or any lien
nugatory or meaningless.
Bank of the Philippine Islands v.
Spouses Royeca
(July 21, 2008)
Subject: Obligations and Contracts
Facts : In 1993, spouses Royeca executed
and delivered to Toyota Shaw, Inc. apromissory note for P577,008 payable in 48
equal monthly installments. It provides for a
penalty of 3% for every month or fraction of
a month that an installment remains unpaid.
To secure the payment of said promissory
note, the spouses executed a Chattel
Mortgage in favor of Toyota over a certain
motor vehicle. Toyota assigned the interest
over the Chattel with Far East Bank and Trust
Company (FEBTC) which eventually merged
with BPI. The bank claimed that the spouses
failed to pay 4 monthly amortizations and
made formal demands. The respondents
refused to pay on the ground that they have
paid their obligation by issuing 8 postdated
checks in different amounts. FEBTC then
filed a complaint for replevin and damages.
The spouses filed a counterclaim for
damages. They averred that they were in
good faith since they did not receive any
notice from the drawee banks or from FEBTC
that these checks were dishonored. MeTC
ruled for the spouses. On appeal the RTC
reversed, holding for the BPI. The CA ruled
for the spouses and reinstated the MeTC
decision.
Issues: WON tender of checks constitutes
payment
Held: No. Settled is the rule that
payment must be in legal tender. A
check is not legal tender and, therefore,
cannot constitute a valid tender of payment.
Since a negotiable instrument is only a
substitute for money and not money, the
delivery of such an instrument does not, by
itself, operate as payment. Mere delivery
of checks does not discharge the
obligation under a judgment. The
obligation is not extinguished and
remains suspended until the payment
by commercial document is actually
realized.
To establish their defense, the respondents
therefore had to present proof, not only that
they delivered the checks to the petitioner,but also that the checks were encashed. The
respondents failed to do so. As a general
rule, one who pleads payment has the
burden of proving it. Even where the plaintiff
must allege non-payment, the general rule is
that the burden rests on the defendant to
prove payment, rather than on the plaintiff
to prove non-payment. The debtor has the
burden of showing with legal certainty that
the obligation has been discharged by
payment.
Corinthian Gardens Association vs
Spouses Tanjangcos and Spouses
Cuasos
June 27, 2008
Nachura, J.
Torts and Damages:
* (ELEMENTS/REQUISITES)
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In every tort case filed under
Article 2176, plaintiff has to prove by
a preponderance of evidence:
(1) the damages suffered by
the plaintiff;
(2) the fault or negligence of
the defendant or some other person
for whose act he must respond;and
(3) the connection of cause and
effect between the fault or negligence
and the damages incurred.
* (DEFINITION)
A negligent act is an
inadvertent act; it may be merely
carelessly done from a lack of
ordinary prudence and may be
one which creates a situation
involving an unreasonable risk
to another because of the expectable
action of the other, a third person, an
animal, or a force of nature. A
negligent act is one from which an
ordinary prudent person in the
actor's position, in the same or
similar circumstances, would foresee
such an appreciable risk of harm
to others as to cause him not to do
the act or to do it in a morecareful manner.
* (TEST)
The test to determine the
existence of negligence in a particular
case may be stated as follows: Did
the defendant in committing the
alleged negligent act use that
reasonable care and caution which
an ordinary person would have used
in the same situation?
Facts:
Tanjangcos owned joined lots in
Corinthian Gardens. Spouse Cuasos,
on the other hand, own a lot adjacent
to the former’s.
Before the Cuasos constructed their
house, it was surveyed by De Dios
Realty (surveyor) as per
recommendation of the petitioner
association. Later on, the petitioner
approved the plans made by CB Paras
Construction (builder). Corinthian
conducted periodic ocular inspections
in order to determine compliance with
the approved plans pursuant to theManual of Rules and Regulations of
Corinthian (MRRC). Unfortunately,
after construction, the perimeter
fence of the Cuasos’ encroached upon
the Tanjangcos’ lot.
Issue:
Whether Corinthian was negligent
under the circumstances and, if so, whether
such negligence contributed to the injury
suffered by the Tanjangcos.
Decision:
Corinthian is negligent. Its approval of
the plan is tainted with negligence.
Ratio:
Petitioner is found negligent under the
TEST. The MRRC provides that no newconstructions can be started without the
approval of the petitioner association. Thus,
it is reasonable to assume that
Corinthian, through its representative, in the
approval of building plans, and in the
conduct of periodic inspections of on-
going construction projects within the
subdivision, is responsible in insuring
compliance with the approved plans,
inclusive of the construction of perimeter
walls.
Corinthian’s failure to prevent the
encroachment of the Cuasos’
perimeter wall into Tanjangcos’
property – despite the inspection
conducted – constitutes negligence
and, at the very least, contributed to
the injury suffered by the
Tanjangcos.
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NB
1. The court here categorized the case
as falling under tort. Take note that
there are discussions regarding
similarity or difference of a QD and a
tort. (just thinking out loud)
2. This is another case where the court
ruled using Article 2176 despite the
fact that there is an existing
contractual obligation between the
parties. (just a thought to ponder on)
April 30, 2008
G.R. No. 140944
RAFAEL ARSENIO S. DIZON, IN HISCAPACITY AS THE JUDICIALADMINISTRATOR OF THE ESTATE OF THEDECEASED JOSE P. FERNANDEZ v. COURT OF TAX APPEALS ANDCOMMISSIONER OF INTERNAL REVENUE
Ponente
Justice Nachura
Subject
Estate Taxation – Allowable Deductions,Date-of-Death Valuation Principle
Facts
Jose P. Fernandez died in November 7, 1987. Thereafter, a petition for the probate of hiswill was filed. The probate court appointedAtty. Rafael Arsenio P. Dizon as administratorof the Estate of Jose Fernandez.
An estate tax return was filed later on whichshowed ZERO estate tax liability. BIRthereafter issued a deficiency estate taxassessment, demanding payment of Php66.97 million as deficiency estate tax. Thiswas subsequently reduced by CTA to Php37.42 million. The CA affirmed the CTA’sruling, hence, the instant petition.
The petitioner claims that in as much as thevalid claims of creditors against the Estateare in excess of the gross estate, no estatetax was due. On the other handrespondents argue that since the claims ofthe Estate’s creditors have been condonedsuch claims may no longer be deducted fromthe gross estate of the decedent.
Issue
Whether the actual claims of creditors maybe fully allowed as deductions from thegross estate of Jose despite the fact that thesaid claims were reduced or condonedthrough compromise agreements enteredinto by the Estate with its creditors
Decision
YES.
Ratio
Following the US Supreme Court’s ruling inIthaca Trust Co. v. United States, the Courtheld that post-death developments are notmaterial in determining the amount odeduction. This is because estate tax is atax imposed on the act of transferringproperty by will or intestacy and, becausethe act on which the tax is levied occurs at a
discrete time, i.e., the instance of death, thenet value of the property transferred shouldbe ascertained, as nearly as possible, as ofthe that time. This is the date-of-deathvaluation rule.
The Court, in adopting the date-of-deatvaluation principle, explained that:
• First. There is no law, nor do we
discern any legislative intent in outax laws, which disregards the date-
of-death valuation principle andparticularly provides that post-deathdevelopments must be considered indetermining the net value of theestate. It bears emphasis that taxburdens are not to be imposed, nopresumed to be imposed, beyondwhat the statute expressly and clearlyimports, tax statutes being construedstrictissimi juris against thegovernment.
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• Second . Such construction finds
relevance and consistency in ourRules on Special Proceedings whereinthe term "claims" required to bepresented against a decedent's estateis generally construed to mean debtsor demands of a pecuniary naturewhich could have been enforced
against the deceased in his lifetime,or liability contracted by the deceasedbefore his death. Therefore, theclaims existing at the time of deathare significant to, and should be madethe basis of, the determination of allowable deductions.
EZTINOZO vs. CA
• FEBRUARY 12, 2008
• NACHURA, J.
• SUBJECT AREA: Rule 45; Rule 65
• NATURE: Petition for Certiorari under
Rule 65
• FACTS: Petitioner was charged with
the crime of estafa. It was alleged thatpetitioner represented herself to thecomplainants that she was the ownerof a recruitment agency and that shewas recruiting workers to be sentabroad. She asked from thesecomplainants the payment of placement and processing feestotaling P15,000.00. Complainantswere promised that they would bedeployed by July 1986. However,private complainants never left thecountry.
• In her defense, she contended that
she was merely an agent of the realrecruiter, a certain Fe CorazonRamirez, and the money she receivedfrom the Complainants was remittedto Ramirez.
• The RTC found her guilty of sevencounts of estafa. The petitioner
appealed the case to the CA. The CAaffirmed the ruling of the RTC.
• On May 30, 2001, within the 15-day
reglementary period to file a motionfor reconsideration or a petition foreview, petitioner filed with theappellate court a Motion for Extension
of Time to File a Motion forReconsideration. On June 28, 2001the CA denied the said motionpursuant to Rule 52, Section 1 of theRules of Court and Rule 9, Section 2 ofthe Revised Internal Rules of the Courtof Appeals (RIRCA).
• Petitioner then filed a Motion for
Reconsideration of the June 28, 2001Resolution of the CA. The appellatecourt denied the same, on August 17
2001.
• Hence, this instant Petition for
Certiorari under Rule 65.
• ISSUE: WON petition for certiorar
under Rule 65 is the proper remedy.
• HELD: It was not the proper remedy
The petitioner should have filed iunder Rule 45.
• RATIO: Section 1 of Rule 45 of the
Rules of Court expressly provides thata party desiring to appeal bycertiorari from a judgment or finaorder or resolution of the CA may filea verified petition for review oncertiorari. Petition for certiorarunder Rule 65 lies only when the
judgment or final order warendered without or in excess of
jurisdiction, or with grave abuseof discretion and where there isno appeal or plain, speedy andadequate remedy in the ordinarycourse of law.
• In this case, appeal by certiorari was
available to petitioner. There was nograve abuse of discretion committedby the CA in its decision. The CAcorrectly denied petitioner’s Motionfor Extension of Time to File a Motionfor Reconsideration. The rule is thatthe 15-day reglementary period fo
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appealing or filing a motion forreconsideration or new trial cannot beextended, except in cases before theSupreme Court, as one of last resort,which may, in its sound discretiongrant the extension requested Thisrule also applies even if the motion isfiled before the expiration of the
period sought to be extended.
• DISPOSITVE: Petition for Certiorari
dismissed
FAR EAST BANK & TRUST COMPANY,Petitioner, - versus - GOLD PALACE
JEWELLERY CO., as represented by JudyL. Yang, Julie Yang-Go and Kho SoonHuat, Respondent
• FACTS: Samuel Tagoe, a foreigner,purchased from Gold Palace (SMNorth) jewelries worth PHP258,000.00. As payment, he offered aforeign draft issued by the UnitedOverseas Bank of Malaysia addressedto Land Bank, and payable to GoldPalace for PHP 380,000.00. Judy Yang,the assistant GM of Gold Palaceinquired from Far East Bank (SMNorth) regarding the draft’s nature.
The teller told her that it was similar
to a manager’s check but advised herto not release the jewelry until thedraft has been cleared. Following theadvice, Yang Issued a cash invoice to
Tagoe & told him that the jewelrieswould be released when the draft hadbeen cleared. Julie Yang-Go, themanager of Gold Palace, depositedthe draft in the company’s accountwith Far East Bank SM North. Thelatter presented it for clearing to LBP,the drawee bank, who cleared the
same. United Overseas account withLBP was debited and Gold Palace’saccount with Far East was creditedwith the amount stated in the draft.
The pieces of jewelry were thenreleased to Tagoe and because theamount in the draft was more thanthe value of the goods, a check forPHP 122,000 was issued to him. Itwas encashed by Tagoe.
• 3 weeks after, LBP informed Far East
that the amount in the foreign draft
had been materially-altered from PHP
300.00 to PHP 380,000.00 and that
they will be returning it. Far East thus
refunded the amount paid by LBP
Thus, Far East had to see
reimbursement from Gold Palace butthey were only able to debit PHP
168,053.37, which was done without a
prior written notice to Gold Palace as
they only informed them by phone
They thus demanded the difference of
PHP 211,946.64 from Gold Palace. As
the latter did not respond favorably
Far East instituted a civil case for sum
of money and damages. Gold Palace
denies the allegations in the
complaint and claims as their defense
that the subject foreign draft has been
cleared and it was not they who
caused the alteration. The RTC ruled
in favor of Far East but this was
reversed by the CA as Far East failed
to undergo the proceedings on the
protest and thus, Far East could not
charge Gold Palace on its secondary
liability as an indorser. It further said
that the drawee bank had cleared thecheck and its remedy should be
against the part responsible for the
alteration.
• ISSUE: WHETHER OR NOT FAR
EAST BANK COULD PROCEED
AGAINST GOLD PALACE.
• HELD: No.
• RATIO: The acceptor, by acceptingthe instrument, engages that he wil
pay it according to the tenor of his
acceptance. This provision applies
with equal force in case the drawee
pays a bill without having previously
accepted it. His actual payment of the
amount in the check implies not only
his assent to the order of the drawer
and a recognition of his corresponding
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obligation to pay the aforementioned
sum, but also, his clear compliance
with that obligation. Actual payment
by the drawee is greater than his
acceptance, which is merely a
promise in writing to pay. The
payment of a check includes its
acceptance.
• Unmistakable herein is the fact thatthe drawee bank cleared and paid thesubject foreign draft and forwardedthe amount thereof to the collectingbank. LBP was liable on its paymentof the check according to the tenor of the check at the time of payment,which was the raised amount. Thus,LBP could no longer repudiate thepayment it erroneously made to a due
course holder. Gold Palace was not aparticipant in the alteration of thedraft, was not negligent, and was aholder in due course—it received thedraft complete and regular on its face,before it became overdue and withoutnotice of any dishonor, in good faithand for value, and absent anyknowledge of any infirmity in theinstrument or defect in the title of theperson negotiating it.
• This construction and application of
the law is in line with the sound
principle that where one of two
innocent parties must suffer a loss,
the law will leave the loss where it
finds it. It further reasserts the
usefulness, stability and currency of
negotiable paper without seriously
endangering accepted banking
practices. Banking institutions can
readily protect themselves against
liability on altered instruments either
by qualifying their acceptance or
certification, or by relying on forgery
insurance and special paper which will
make alterations obvious. The drawee
bank, in most cases, is in a better
position, compared to the holder, to
verify with the drawer the matters
stated in the instrument.
• Thus, considering that, in this case
Gold Palace is protected by Section 62
of the NIL, its collecting agent, Fa
East, should not have debited the
money paid by the drawee bank from
respondent company’s account. When
Gold Palace deposited the check with
Far East, the latter, under the terms of
the deposit and the provisions of the
NIL, became an agent of the former
for the collection of the amount in the
draft. The subsequent payment by the
drawee bank and the collection of the
amount by the collecting bank closed
the transaction insofar as the drawee
and the holder of the check or his
agent are concerned, converted thecheck into a mere voucher, and, as
already discussed, foreclosed the
recovery by the drawee of the amount
paid. This closure of the transaction is
a matter of course.
• As the transaction in this case had
been closed and the principal-agent
relationship between the payee and
the collecting bank had already
ceased, the latter in returning the
amount to the drawee bank was
already acting on its own and should
now be responsible for its own
actions. Neither can petitioner be
considered to have acted as the
representative of the drawee bank
when it debited respondent’s account
because, as already explained, the
drawee bank had no right to recover
what it paid. Likewise, Far Eastcannot invoke the warranty of the
payee/depositor who indorsed the
instrument for collection to shift the
burden it brought upon itself. This is
precisely because the said
indorsement is only for purposes o
collection which, under Section 36 of
the NIL, is a restrictive indorsement. It
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did not in any way transfer the title of
the instrument to the collecting bank.
• CA ruling is affirmed to the extent that
Far East could not debit Gold Palace’s
account. Its remedy is not against
Gold Palace but against the drawee-
bank or the person responsible for the
alteration.
Title: Fermin v. PeopleDate: 28 March 2008Ponente: J. NachuraSubject/Topic: Criminal Law, Libel
Facts:
•
Cristy Fermin is the publisher andBogs Tugas is the editor-in-chief of Gossip Tabloid
• The June 14, 1995 headline and lead
story of the tabloid says that it isimprobable for Annabelle Rama to goto the US should it be true that she isevading her conviction in an estafacase here in the Philippines for sheand husband Eddie have moreproblems/cases to confront there. Thiswas said to be due to their, especially
Annabelle's, using fellow Filipinos’money, failure to remit proceeds tothe manufacturing company of thecookware they were selling and notbeing on good terms with the latter.
• Annabelle and Eddie filed libel casesagainst Fermin and Tugas before RTCof QC, Br. 218.
• RTC: Fermin and Tugas found guilty of
libel.
• CA: Tugas was acquitted on account of
non-participation but Fermin'sconviction was affirmed.
• Fermin's motion for reconsideration
was denied hence, this petition. Sheargues that she had no knowledgeand participation in the publication of the article, that the article is notlibelous and is covered by thefreedom of the press.
Issue: WON Cristy Fermin is guiltyof libel?
Held/Ratio: YES.
• Proof of knowledge of and
participation in the publication isnot required, if the accused hasbeen specifically identified as“author, editor, or proprietor” or
“printer/publisher” of thepublication.
o Petitioner was not only the
“publisher,” but also the“president” and“chairperson.”
Petitioner’s criminal guiltshould be affirmedwhether or not she hadactual knowledge andparticipation.
• The elements of libel were
present.
o Evident imputation of thecrime of malversation(converting money for personause), of vices or defects forbeing fugitives from the law(evading prosecution inAmerica) and of being awastrel
o Attribution made publiclyGossip Tabloid had anationwide circulation.
o The victims were identifiedand identifiable.
o The article reeks of malice, as
it tends to cause the dishonordiscredit, or contempt of thecomplainants.
Malice in law - thearticle was malicious initself; the imputationswere false.
Malice in fact - therewas motive to talk ilagainst complainantsduring the electoracampaign as Fermin is aclose friend of Eddie'sopponent in theCongressional race
• While complainants are considered
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public figures for being personalitiesin the entertainment business, mediapeople do not have the unbridledlicense to malign their honor anddignity by indiscriminately airingfabricated and malicious comments,whether in broadcast media or inprint, about their personal lives.
Note: CA erred in acquitting Tugas, hebeing the editor-in-chief. But the SCcannot reinstate the ruling of the trialcourt convicting Bogs Tugas becausewith his acquittal by the CA as that would run afoul of his constitutional right against double jeopardy.
Fernandez v. Comelec and Rodriguez
June 30, 2008; Nachura
Election Law; Appelate jurisdiction of
Comelec
Facts:
July 15, 2002 SK elections of Barangay
Pandan del Sur, Pandan, Catanduanes, resp.
Rodriguez won as SK chairman over pet.Fernandez. Fernandez filed a protest in the
MCTC of Pandan. On January 12, 2004, MCTC
declared Fernandez as the winner and
ordered her proclamation. Rodriguez
appealed to Comelec, which, on Dec. 4,
2006 reversed the MCTC decision. Motion for
recon was denied, so Fernandez went to SC
arguing that that the Comelec has no
appellate jurisdiction over contests involving
SK officials decided by trial courts of limited
jurisdiction.
Issue: WON Comelec has jurisdiction.
Held: YES.
The Constitution [Art. IX-C, Sec. 2(2)] vests
in the COMELEC appellate jurisdiction over
all contests involving elective barangay
officials decided by trial courts of limited
jurisdiction. Construed in relation to the
provision in RA 7160 [LocGovCode] that
includes in the enumeration of barangay
officials the SK chairman,[Sec. 387(a)] theconstitutional provision indeed sanctions the
appellate review by the COMELEC of election
protests involving the position of SK
chairman, as in the instant case. Hence, we
find nothing improper in the COMELEC’s
assumption of jurisdiction over respondent’s
appeal.
Petitioner’s reliance on our ruling in Mercado
v. Board of Election Supervisors[1995] that
contests involving the SK chairman do notfall within Section 252 of the Omnibus
Election Code and paragraph 2, Section 2,
Article IX-C of the Constitution, is misplaced.
The doctrine therein, as we explained in the
much later Marquez v. Commission on
Elections[1999], is no longer controlling.
Thus, the present rule is that trial courts of
limited jurisdiction have exclusive original
jurisdiction over election protests involving
barangay officials, which include the SK chairman, and that the COMELEC has the
exclusive appellate jurisdiction over such
protests [Batoy v. Judge Calibo, Jr., 445 Phil.
547, 553-554 (2003); Beso v. Aballe, 382
Phil. 862, 870 (2000)].
Note: SC also dismissed the case as moot
and academic. By the time the case reached
the SC, the term of office of the SK chair
already expired. The discussion on Comelec
jurisdiction is for the guidance of the benchand bar.
Ferrer v. Ombudsman
[COL. ARTURO C. FERRER (RET.), petitioner
vs. HON. OFFICE OF THE OMBUDSMAN
ROMEO G. DAVID, Former Administrator
JOEMARI D. GEROCHI, Administrato
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National Food Authority (NFA), FRANCISCO G.
CORDOBA, JR., chairman, PBAC, MARCELINO
B. AGANA IV, EVANGELINE V. ANAGO,
BENJAMIN D. JAVIER, and CELIA Z. TAN,
Members, PBAC, respondents]
Aug. 6, 2008; Nachura
Ombudsman jurisdiction/authority
Facts:
The National Food Authority (NFA) needed
security services nationwide. The
Prequalification, Bids and Awards Committee
(PBAC) was tasked to undertake the pre-
qualification of prospective bidders, etc. Thebidding was held in June 1994, and among
the bidders were Odin Security Agency
(owned by petitioner) and Metroguard and
Protective Security Agency of the Philippines
(Metroguard) and Davao Security and
Investigation Agency, Inc. (DASIA).
Metroguard and DASIA were admittedly
“sister” agencies. Having perceived a
collusion between DASIA and Metroguard,
the other participating bidders, includingOdin, protested. NFA sought opinion of the
Office of the Govt. Corp. Counsel (OGCC),
which stated that bid proposal of both
Metroguard and DASIA should be rejected for
being collusive. Consequently, the bids of
the two agencies were rejected by NFA.
DASIA went to RTC, which ruled that the
rejection of DASIA’s bid invalid and illegal, in
violation of its right to due process. David
and Cordoba of NFA appealed to CA, but
during the pendency of the appeal,
respondents proceeded to award the
security service contracts to both
Metroguard and DASIA (kasi binding pa yung
ruling ng RTC na kasali sila sa bidding; at ok
din ung bids nila). This prompted petitioner
to file on August 23, 1996 a Complaint-
Affidavit against respondents before the
Office of the Ombudsman, but it was
dismissed outright for lack of merit based on
the Evaluation Report of Graft Investiation
Officer (GIO) Gruta dated October 25, 1996
The said report was approved by then
Ombudsman Aniano A. Desierto on
November 27, 1996. Petitioner went to SC
on the following:
Issues:
1. Whether or not petitioner’s complaint
(OMB-0-96-1986) may be dismissed
on the basis of a resolution in another
complaint (OMB-0-96-1552) filed by
another complainant (Eugenio M
Revita).
Petitioner contends that in issuing the
questioned Evaluation Report, GIO Gruta
failed to consider the merits of his complaint
but simply adopted the Resolution of GIO
Ginez-Jabalde in OMB-0-96-1552 which is
tantamount to a violation of his right to due
process. We disagree.
The prerogative as to whether or not a
complaint may be given due course belongs
exclusively to the Office of the Ombudsman,
through its assigned investigation officer
who in this case was GIO Gruta. It is
apparent that GIO Gruta had carefullystudied the complaint which, indeed, raised
the very same arguments as in OMB-0-96-
1552 pertinent to the alleged collusion
between Metroguard and DASIA in the very
same public bidding held by NFA on June 21,
1994 and the purported unwarranted
benefits given to these security agencies by
respondents when they were awarded the
security service contracts for the NFA areas
of operations said agencies tendered their
bids for. Concurring with the
recommendation of GIO Ginez-Jabalde in
OMB-0-96-1552 to dismiss the complaint
similarly approved by then Ombudsman
Desierto, does not necessarily indicate that
GIO Gruta did not exercise her independent
judgment in this case in concluding that the
complaint lodged by petitioner lacks merit
To conduct a preliminary investigation when
deemed unnecessary as the same issues
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being raised had already been resolved
would be superfluous.
2. Whether or not the decision of the
RTC-Davao, Br. 17, in Civil Case No.
23, 531 may be validly used as the
basis by respondents for the award of
the contracts for security services in
favor of Metroguard and DASIA,
notwithstanding the pendency of the
appeal of the decision with the Court
of Appeals, and despite the opinion of
the OGCC that Metroguard and DASIA
must be disqualified from the public
bidding on the ground of collusion
between them.
It bears mentioning that the Decision of the
RTC, Branch 17, Davao City already passedupon the opinions of the OGCC and ruled
that there was no collusion between
Metroguard and DASIA. Since the CA had
not reversed and set aside the decision of
the RTC, Branch 17, Davao City at the time
GIO Gruta reviewed petitioner’s complaint
for alleged violation of Section 3(e) and (g)
of R.A. No. 3019, the RTC Decision remained
controlling. Thus, GIO Gruta was correct in
dismissing the charge for lack of merit.
3. Whether or not the Office of the
Ombudsman has no authority to
investigate charges of violation of
Republic Act 5487, otherwise known
as the Private Security Agency Law, to
determine the criminal liability of
respondents.
The jurisdiction of the Office of the
Ombudsman to investigate and prosecute
criminal cases pertains to violations of R.A.
No. 3019, as amended, R.A. No. 1379, as
amended, R.A. No. 6713, Title VII, Chapter II,
Section 2 of the Revised Penal Code, and
such other offenses committed by public
officers and employees in relation to office.
On the other hand, in R.A. No. 5487, it is the
Philippine National Police (PNP) that
exercises general supervision over the
operation of all private detective and
watchman security guard agencies. It has
the exclusive authority to regulate and to
issue the required licenses to operate
security and protective agencies. In this
case, in the absence of a declaration from
the PNP that a violation of the said law was
committed by Metroguard and DASIA, the
act of the NFA officials in awarding thesecurity service contracts to the said
agencies after a showing that their bids were
the most advantageous to the government is
presumed to be valid.
Verily, the Court has almost always adopted
and quite aptly, a policy of non-interference
in the exercise of the Ombudsman’s
constitutionally mandated powers. The
Ombudsman has the power to dismiss a
complaint outright without going through apreliminary investigation. To insulate the
Office of the Ombudsman from outside
pressure and improper influence, the
Constitution, as well as R.A. No. 6770, saw fit
to endow that office with a wide latitude of
investigatory and prosecutory powers
virtually free from legislative, executive, or
judicial intervention. If the Ombudsman
using professional judgment, finds the case
dismissible, the Court shall respect suchfindings unless tainted with grave abuse of
discretion. The Ombudsman has discretion
to determine whether a criminal case, given
its attendant facts and circumstances
should be filed or not. It is basically his
judgment call.
FIGUEROA vs. PEOPLE OF THE
PHILIPPINES
JULY 14, 2008
NACHURA, J.
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SUBJECT AREA: Estoppel by laches
NATURE: Petition for review on certiorari
FACTS: Petitioner was charged with the
crime of reckless imprudence resulting in
homicide. The RTC found him guilty. In his
appeal before the CA, the petitioner, for the
first time, questioned RTCs jurisdiction on
the case.
The CA in affirming the decision of the RTC,
ruled that the principle of estoppel by laches
has already precluded the petitioner from
questioning the jurisdiction of the RTC—the
trial went on for 4 years with the petitioner
actively participating therein and without
him ever raising the jurisdictional infirmity.
The petitioner, for his part, counters that the
lack of jurisdiction of a court over the
subject matter may be raised at any time
even for the first time on appeal. As undue
delay is further absent herein, the principle
of laches will not be applicable.
Hence, this petition.
ISSUE: WON petitioner’s failure to raise the
issue of jurisdiction during the trial of this
case, constitute laches in relation to thedoctrine laid down in Tijam v. Sibonghanoy,
notwithstanding the fact that said issue was
immediately raised in petitioner’s appeal to
the CA
HELD: No.
RATIO: Citing the ruling in Calimlim vs
Ramirez, the Court held that as a genera
rule, the issue of jurisdiction may be raised
at any stage of the proceedings, even on
appeal, and is not lost by waiver or by
estoppel.
Estoppel by laches may be invoked to
bar the issue of lack of jurisdiction only
in cases in which the factual milieu is
analogous to that of Tijam v
Sibonghanoy.
Laches should be clearly present for
the Sibonghanoy doctrine to be
applicable, that is, lack of jurisdiction musthave been raised so belatedly as to warrant
the presumption that the party entitled to
assert it had abandoned or declined to
assert it.
In Sibonghanoy, the party invoking lack of
jurisdiction did so only after fifteen years
and at a stage when the proceedings had
already been elevated to the CASibonghanoy is an exceptional case because
of the presence of laches.
In the case at bar, the factual settings
attendant in Sibonghanoy are not present
Petitioner Atty. Regalado, after the receipt of
the Court of Appeals resolution finding her
guilty of contempt, promptly filed a Motion
for Reconsideration assailing the said court’s jurisdiction based on procedural infirmity in
initiating the action. Her compliance with
the appellate court’s directive to show cause
why she should not be cited for contempt
and filing a single piece of pleading to that
effect could not be considered as an active
participation in the judicial proceedings so
as to take the case within the milieu of
Sibonghanoy. Rather, it is the natural fear to
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disobey the mandate of the court that could
lead to dire consequences that impelled her
to comply.
The petitioner is in no way estopped by
laches in assailing the jurisdiction of the RTC,
considering that he raised the lack thereof inhis appeal before the appellate court. At
that time, no considerable period had yet
elapsed for laches to attach.
DISPOSITIVE: Petition for review on
certiorari is granted. Criminal case is
dismissed.
Flourish Maritime Shipping vs.
Almanzor
March 14, 2008
Nachura, J.
Labor Law. The choice of which amount to
award an illegally dismissed overseas
contract worker, i.e., whether his salaries for
the unexpired portion of his employmentcontract, or three (3) months’ salary for
every year of the unexpired term, whichever
is less, comes into play only when the
employment contract concerned has a term
of at least one (1) year or more.
Facts:
Respondent Almanzor entered into a
two-year employment contract with
petitioner Flourish Maritime Shipping asfisherman and was deployed to Taipei,
Taiwan. While on board, he was given an
instruction which he did not understand and
therefore was unable to obey. The master of
the vessel struck him and refused his
requested medical assistance. Respondent
was repatriated to the Philippines but was
not redeployed as promised, thus the
complaint for illegal dismissal, payment for
the unexpired portion of his employment
contract, earned wages, moral and
exemplary damages plus attorney’s fees.
Petitioners Flourish Maritime Shipping
and Uy contended that respondent
voluntarily resigned and that the same did
not comply with the grievance machinery
and arbitration clause embodied in the
employment contract.
The Labor Arbiter rendered a decision
in favour of respondent, awarding him six
months of his monthly pay (3months for
every year of the unexpired term). On
appeal, the NLRC affirmed in toto the Labor
Arbiter’s findings. The Court of Appeals, on
petition for certiorari, modified the NLRC
decision by increasing the monetary awarddue respondent. The Court of Appeals
awarded respondent the unexpired portion
of the first year (11 months and 4 days) and
3 months for the unexpired second year, for
a total of 14 months and 4 days.
Issue No. 1:
WON respondent was illegally
dismissed from employment.
Held: YES.
Ratio:
Petitioners, as concluded by the Labor
Arbiter, failed to adduce any convincing
evidence to establish its claim that
respondent voluntarily residned from
employment. Likewise, the NLRC held that
petitioners failed to show that respondent
was not physically fit to perform work due to
his old age. Neither was it proved that the
employment contract indeed provided a
grievance machinery. Both labor tribunals
correctly concluded, as affirmed by the
Court of Appeals, that respondent was not
redeployed for work, in violation of their
employment contract. Perforce, the
termination of respondent’s services is
without just or valid cause.
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Issue No. 2:
WON the award made by the Court of
Appeals was contrary to law.
Held: YES.
Ratio:
Section 10 of R.A. 8042 provides:
Section 10. Money Claims. – x xx
x x x x
In case of termination of overseas employment without just,valid or authorized cause as definedby law or contract, the worker shall beentitled to the full reimbursement of
his placement fee with interest attwelve percent (12%) per annum, plushis salaries for the unexpired portionof his employment contract or forthree (3) months for every year of theunexpired term, whichever is less.
x x x x.
The correct interpretation of this
provision was settled in Marsaman Manning
Agency Inc. v. NLRC where this Court held
that “the choice of which amount to awardan illegally dismissed overseas contract
worker, i.e., whether his salaries for the
unexpired portion of his employment
contract, or three (3) months’ salary for
every year of the unexpired term, whichever
is less,” comes into play only when the
employment contract concerned has a term
of at least one year or more.
The employment contract involved in
the instant case covers a two-year period
but the overseas contract worker actually
worked for only 26 days prior to his illegal
dismissal. Thus, the three months’ salary
rule applies. Respondent, therefore, is
entitled to six (6) months’ salary as correctly
held by the Labor Arbiter and affirmed by
the NLRC.
Galero vs. CA
Facts:
1. Resident Ombudsman for Phil.PortsAuthority-Port Management Office(PPA-PMO) received two anonymousletters.
2. The first letter alleged that SecurityGuard Geocadin was receivingcompensation from PPA in spite of thefact that Geoacadin is assigned in andis also receiving salary fromNAPOCOR.
3. Second letter alleged that Mr. Elizalde(Port Manager of PPA) and Mr. Galero(acting Port Police DivisionCommander) was receiving shares inthe salaries of ghost employees likeGeocadin in PPA.
4. Resident Ombudsman Caigoyrecommended the filing of criminaand administrative complaint againstGalero for dishonesty, falsification ofpublic documents and causing undueinjury to the government. Complaintagainst Elizalde however is dismissedfor insufficient evidence.
5. Office of the Ombudsman for Visayasfound Galero guilty and recommendedGalero’s dismissal from serviceforfeiture of benefits and perpetua
disqualification from holding publicoffice.6. CA affirmed the decision of the Office
of the Ombudsman Visayas.
Issue: Whether or not Galero is
administratively liable
Held: Yes but only for simple neglect of
duty.
Ratio:
1. That Geocadin is security guard oPPA-PMO assigned to inspectequipment at different PPA stationswas sufficiently established by therecords. He is therefore not a ghostemployee. Hence, nothing was
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falsified and Galero is not dishonest incertifying the DTR of Geocadin.
2. There was also no showing in therecords that Galero was in conclusionwith Geocadin in defrauding thegovernment, hence Galero cannot be
said to have intended to cause undueinjury to the Government.
3. Galero however is guilty of simpleneglect in failing to implementmeasures which could have preventedGeocadin from defrauding thegovernment.
4. Simple neglect of duty is defined as
the failure to give proper attention toa task expected from an employeeresulting from either carelessness orindifference.
5. In this case, had Galero performed thetask required of him, that is, tomonitor the employees’ attendance,he would have discovered that indeedMr. Geocadin was dividing his timebetween PPA and Napocor. Though
not required to know every detail of his subordinates’ whereabouts, Galeroshould have implemented measuresto make sure that the governmentwas not defrauded. As he wasrequired to sign Mr. Geocadin’s DTR,Galero should have verified thetruthfulness of the entries therein.
6. Indeed, Galero neglected his dutywhich caused prejudice to the
government in that Mr. Geocadin waspaid twice for his services.
7. These facts, taken together, aresufficient to make Galero liable forsimple neglect of duty, but insufficientto make him answer for charges of dishonesty and falsification of document.
Title: Luces v. DamoleDate: 14 March 2008Ponente: J. NachuraSubject/Topic: Criminal Law, Estafa
Facts:
• Petitioner Luces and respondent
Damole agreed that Luces would selthe P.O. cards issued by the latter tothe former's customers. Luces wouldget her commission therefrom in theform of marked up prices. Petitionefurther agreed that she would holdthe P.O. cards as trustee of the privatecomplainant with the obligation toremit the proceeds of the sale thereofless the commission, and before suchremittance, to hold the same in trustfor the latter. Lastly, petitioner
undertook to return the unsold POcards.
• Initially, petitioner complied with her
obligations, but later she defaulted inremitting the proceeds. Some P.Ocards were even used by petitionerherself and her relatives, but they didnot pay the corresponding price, norremitted the proceeds.
• Damole filed a civil case for collection
of money and a criminal case forestafa.
1. Petitioner - found guilty oviolation of Article 315(1) (b)(through misappropriation orconversion).
2. CA affirmed the RTC decisionbut with modification on thepenalty.
• Damole filed a petition before the SC
arguing that the CA erred inconvicting her and that she is onlyliable civilly and not criminally.
Issue: WON Luces is criminallyliable for estafa?
Held/Ratio: YES.
The elements of estafa throughmisappropriation or conversion (Article315(1) (b)) were present.
1. That the money, goods or other personal property is received by the
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offender in trust, or on commission, or for administration, or under any other obligation involving the duty to deliver or return the same.
o It was established that petitioner
received from the privatecomplainant the subject POcards to be sold by the former
on commission, as evidenced bytheir Trust Receipt Agreements
2. That there be misappropriation or conversion of such money or property by the offender or denial on his part of such receipt .
o Using or disposing of P.O. cards
by Luces for her and herrelatives’ own personal purposeand benefit, constitutes breachof trust, unfaithfulness and
abuse of confidence.o The failure of LUCES to account
for them establishes the felonyof estafa through abuse of confidence by misappropriationor conversion.
3. That such misappropriation orconversion or denial is to the prejudice of another
1. Damole was deprived of herright to enjoy the proceeds of
the sale as a result of petitioner’s unauthorized useof the PO cards.
4. That there is a demand made by theoffended party on the offender.
o In spite of repeated demands
made upon Luces by Damole,she has failed and refused tocomply with her obligation.
The civil case filed by the
Damole is not a prejudicialquestion. The issues weredifferent.
• Civil case - Damole’s right to recover
from Luces the amount representingthe value of the P.O. cards allegedlyembezzled by the latter.
• Criminal case - WON Luces’ failure to
account for the proceeds of the sale of P.O. cards and/or to return the unsold
P.O. cards as Damole’s trusteeconstitutes estafa under Art. 315 par1 (b) of the RPC.
MATA vs AGRAVANTE
August 6, 2008
Nachura, J.
TORTS AND DAMAGES:
* DEFINITION
Article 19 which contains what
is commonly referred to as the
principle of abuse of rights, is
not a panacea for all human
hurts and social grievances.
The object of this article is to
set certain standards which
must be observed not only inthe exercise of one’s rights but
also in the performance of
one’s duties.
STANDARDS (A19)
Act with justice, Give everyone
his due, and Observe honesty and
good faith.
* DEFINITION
Article 21 refers to acts contra
bonos mores
ELEMENTS
(1) an act which is legal; (2) but
which is contrary to morals,
good custom, public order or
public policy; and (3) is done
with intent to injure.
* The common element under
Articles 19 and 21 is that the
act complained of must beintentional, and attended with
malice or bad faith.
* There is no hard and fast
rule which can be applied to
determine whether or not the
principle of abuse of rights may
be invoked. The question of
whether or not this principle
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has been violated, depends on
the circumstances of each
case.
Facts
Mata owns a security agency.
Respondents were former security
gurads who filed a complaint in the
NLRC for non-payment of salaries and
wages. They then subsequently filed
an affidavit complaint with the PNP,
copies were then sent to various
offices including the Office of the
President and the DPWH, petitioner’s
biggest client.
Issue
Whether or not respondents
furninshing of copies to the PNP,
DPWH etal was tainted with bad faith
and hence liable for damages.
Decision
Respondents not liable. There was nomalicious intent to injure petitioner’s
good name and reputation. The
respondents merely wanted to call the
attention of responsible government
agencies in order to secure
appropriate action upon an erring
private security agency and obtain
redress for their grievances.
Ratio
In filing the letter-complaint with the
Philippine National Police and
furnishing copies thereof to seven (7)
other executive offices of the national
government, the defendants-
appellants may not be said to be
motivated simply by the desire to
“unduly prejudice the good name and
reputation” of plaintiff-appellee. Such
act was consistent with and a rational
consequence of seeking justice
through legal means for the alleged
abuses defendants-appellants
suffered in the course of their
employment.
The act of furnishing copies was
merely to inform said offices of the
fact of filing of such complaint, as is
usually done by individual
complainants seeking official
government action to address their
problems or grievances.
In the absence of proof that there was
malice or bad faith on the part of the
respondents, no damages can be
awarded.
MERALCO vs WILCON BUILDERS
SUPPLY, INC.
June 30, 2008
Nachura, J.
TORTS AND DAMAGES:
* RIDJO DOCTRINE (Ridjo Tape
vs CA)Public utility has the imperative
duty to make a reasonable
and proper inspection of its
apparatus and equipment to
ensure that they do not
malfunction. Its failure to
discover the defect , if any,
considering the length of time,
amounts to inexcusable
negligence; its failure to make
the necessary repairs and
replace the defective electric
meter installed within the
consumer’s premises limits the
latter’s liability.
Defect may be inherent,
intentional or unintentional,
which therefore covers
tampering, mechanical defects
and mistakes in the
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computation of the consumers’
billing
Facts
Wilcon Builders is a registered
customer of MERALCO. In 1991,
MERALCO’s inspectors did a routineinspection of the electric meters of
Wilcon. Allegedly, the meters were
found to have been tampered.
Meralco seized the meters and later
informed Wilcon of the tampering and
was demanding s certain sum
representing the unregistered electric
consumption.
Wilcon, for its part, said that the
reason for the abrupt decrease in their
consumption was the breaking down
of their 7.5 ton air-conditioning unit in
1986.
Issue
Whether or not MERALCO is negligent
applying the Ridjo Doctrine.
Decision
MERALCO is negligent. Public service
companies which do not exercise prudence
in the discharge of their duties shall be
made to bear the consequences of such
oversight.
Ratio
According to the petitioner, there was
a sudden drop in respondent’s electric
consumption during the last quarter of 1984. If this contention were true, the
moment a sudden drop of electric
consumption was reflected in its records,
petitioner should have conducted an
immediate investigation to make sure
that there was nothing wrong with the
meter, especially because, by its own
account, the subject meter had a history of
previous tampering.
We cannot sanction a situation
wherein the defects in the electric meter are
allowed to continue indefinitely until
suddenly the public utilities concerned
demand payment for the unrecorded
electricity utilized when, in the first place,
they should have remedied the situation
immediately. If we turn a blind eye onMERALCO’s omission, it may encourage
negligence on the part of public
utilities, to the detriment of the consuming
public.
Novicio vs People
GR No 163331
Date: August 29, 2008
Petitioner: Arellano Novicio
Respondent: People of the Philippines
Nature: Petition for Review On
Certiorati (Rule 45)
for the reversal of the CA
decision
Facts:
o The incident took place on Sept 24,
1998 in Bacong San Luis, Aurora.o Mario Mercado was already drinking
with his friends when Arellano Novicioarrived.
o (MERCADO’S VERSION)Novicio drew a
gun, pointed it at Mercado, andthreatened him. When Mercado was
about to stand, Novicio shot him.Mercado ran and hid as Novicioattempted to shoot him for a secondtime.
o (NOVICIO’S VERSION) Mercado loudly
exclaimed lies and fabricationsintended to provoke Novicio. WhenNovicio asked him to stop, Mercadogot mad. Mercado drew his gun andpointed it at Novicio. Novicio tried to
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wrest the gun and a scuffle ensued. The gun fired accidentally.
o Novicio was charged with the crime of
frustrated homicide, since all theacts of execution that would havecaused the death of Mercado if not forthe timely and effective medicalattention given to him.
Issue (1) : WON Novicio acted in
self-defense.
Held: No.
Ratio: There was no unlawful
aggression on the part of Mario to justify Novicio’s
act of shooting him.
No reason to depart from
the findings of RTC and CA.
Issue (2): WON there was intent to
kill.
Held: Yes.
Ratio: Intent to kill is
manifested in the act of
using the lethal weapon,
attempting to shoot the
victim for a second time,
and the seriousness of the injury sustained.
Decision: Petition denied.
TITLE OF THE CASE: OLIVEROS V. SISON
DATE OF PROMULGATION: March 14
2008
SUBJECT AREA: Civil Procedure
KEY DOCTRINES/CONCEPTS: Gross
Ignorance of the Law; Indirect
Contempt
FACTS:
Before the SC is a Motion for Partia
Reconsideration filed by Judge Dionisio CSison seeking the reversal the SC decision
finding him guilty of gross ignorance of the
law and fined P1,000. Judge Sison failed to
abide by the requirements under the
Revised Rules on Civil Procedure in citing
complainant spouses Arleen and Lorna
Oliveros for indirect contempt. As gleaned
from the resolution, the contempt charge
was not filed as a separate and independent
petition from the principal action pending
before the court. Also, the warrant of arrest
was issued on the same day that the motion
for contempt was made in a hearing in which
the complainant spouses failed to appear.
Complainant spouses Oliveros filed a petition
for certiorari before the CA questioning the
contempt order. Subsequently, they filed
the present administrative case with the SC
They failed to inform the SC of the petition
for certiorari pending before the CA.
ISSUE 1: WON JUDGE SISON IS GUILTY
OF GROSS IGNORANCE OF THE LAW
DECISION: Yes.
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RATIO:
Rule 71 of the Revised Rules on Civil
Procedure explicitly sets out the
requirements for instituting a complaint forindirect contempt.
SEC. 4. How proceedings
commenced . – Proceedings for
indirect contempt may be
initiated motu proprio by the
court against which the
contempt was committed by an
order or any formal chargerequiring the respondent to
show cause why he should not
be punished for contempt.
In all other cases, charges for
indirect contempt shall be
commenced by a verified
petition with supporting
particulars and certified truecopies of documents or papers
involved therein, and upon full
compliance with the
requirements for filing initiatory
pleadings for civil actions in the
court concerned. If the
contempt charges arose out of
or are related to a principal
action pending in court, the
petition for contempt shall
allege that fact but said petition
shall be docketed, heard and
decided separately, unless the
court in its discretion orders the
consolidation of the contempt
charge and the principal action
for joint hearing and decision.
Good faith in situations of fallible discretion
inheres only within the parameters of
tolerable misjudgment and does not apply
where the issues are so simple and the
applicable legal principle evident and basic
as to be beyond permissible margins of
error. When the law is so elementary, not to
know it constitutes gross ignorance of thelaw.
Moreover, complainants should have been
given the opportunity to be heard and to
defend themselves against the contempt
charge, involving as it does such a dire
consequence as imprisonment for six
months. The undue haste in disposing of the
motion for contempt deprived complainantsof one of man’s most fundamental rights
the right to be heard.
ISSUE 2: WON COMPLAINANT SPOUSES
OLIVEROS MAY BE HELD LIABLE FOR
CONTEMPT FOR NOT DISCLOSING THE
PETITION FOR CERTIORARI INVOLVING
THE SAME ISSUE PENDING BEFORE THE
CA
DECISION: Yes
RATIO:
Complainants themselves admitted that
they failed to inform this Court of the
petition they filed before the CA within five
days after they “learn[ed] that the same or
similar action or claim has been filed or is
pending,” as provided by the Rules. They
however, argue that they were not aware of
such requirement. While that may have been
true, their argument becomes untenable
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when seen in the light of their subsequent
actions. The Verification/Certification of the
Petition for Certiorari before the CA clearly
shows that both complainants signed the
same. Thus, they are presumed to have read
its contents. This should have already made
them aware of the requirement to inform the
Court of the filing of the case before the CAconsidering that in the latter case, they are
praying for the nullification of the very same
Order for which they were seeking
administrative sanctions against respondent
Judge before this Court. Thus, there appears
a real possibility that the pernicious effect
sought to be prevented by the rules
requiring the Certification against Forum
Shopping would arise. Accordingly, the
complainants could be held liable for
contempt of this Court.
Orozco v CA
August 13, 2008 J. Nachura
Subject Area: employer-employeerelationship, control test, economic realitytest
Facts: Orozco was a columnist of PDI whosecolumn was discontinued. She is now suingfor illegal dismissal as an employee.
Issue: (In the first place) WON a columnist isan employee of the newspaper.
Decision: No.
Ratio:Control Test - The main determinant of theee-er relationship is whether the rules set bythe er are meant to control not just theresults of the work but also the means andmethods to e used by the hired party inorder to achieve the results.Petitioner was engaged as a columnist forher talent, skill, experience, and uniqueviewpoint as a feminist advocate. How sheutilized all these in writing her column wasnot subject to dictation. Any rules imposedon her as to length of articles, time of submission, etc. are merely general
guidelines dictated by the nature of thenewspaper business itself.
Economic Reality Test – This is especiallyappropriate when there is no writtenagreement, as in this case. The benchmarkis the economic dependence of the workeron the employee.
Petitioner’s main occupation is not ascolumnist but as women’s rights advocate,and she also contributes articles to otherpublications.
Magalang vs. CAFebruary 26, 2008
J. Nachura
Subject area: CivPro, decisions – final andexecutor; effect, decisions – coordinate
courtsFacts: Magalang filed for illegal dismissal.NLRC rendered a decision, denied Motion forReconsideration of Magalang who filed anappeal with the CA 9th Division; denied MFRof employer who filed an appeal with the CA4th Division. CA 9th Division promulgateddecision first, no appeal made. 4th Divisionsubsequently rendered inconsistent decision
Issue: WON the decision of the 4 th Division isvalid
Decision: No.
Ratio:Various divisions of the CA are, in a sense,coordinate courts, and pursuant to the policyof judicial stability, a division of theappellate court should not interfere with thedecision of other divisions.
Further, no appeal was interposed againstthe 9th Division’s decision; therefore, it
already attained finality. When a decisionbecomes final and executor, the court loses
jurisdiction and not even an appellate courtwill have the power to review the said
judgment. Just as the losing party has theprivilege to file an appeal within theprescribed period, so does the winner havethe correlative right to enjoy the finality of the decision.
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TITLE OF THE CASE: PARISCHA V. DON
LUIS DISON REALTY
DATE OF PROMULGATION: March 14,
2008
SUBJECT AREA: Corporation Law, Civil
Procedure, Obligations and Contracts
KEY DOCTRINES/CONCEPTS: Standing
to Sue of a Corporation; Capacity to
Sue of an Officer on Behalf of a
Corporation; Unlawful Detainer
FACTS:
Respondent Don Luis Dison Realty, Inc. and
petitioners Parischa executed two Contracts
of Lease whereby the former, as lessor,
agreed to lease to the latter Units 22, 24, 32,
33, 34, 35, 36, 37 and 38 of the San Luis
Building located at Ermita, Manila.Petitioners, in turn, agreed to pay monthly
rentals.
Petitioners paid the monthly rentals until
May 1992. After that, however, petitioners
refused to pay the rent. Petitioners assert
that their refusal to pay the rent was
justified because of the internal squabble in
respondent company as to the personauthorized to receive payment. Also,
petitioners alleged that they were prevented
from using the units rented. Petitioners
eventually paid their monthly rent for
December 1992 in the amount of
P30,000.00, and claimed that respondent
waived its right to collect the rents for the
months of July to November 1992 since
petitioners were prevented from using some
of the units. However, they again withheld
payment starting January 1993 because of
respondent’s refusal to turn over Rooms 36
37 and 38.
A complaint for ejectment was filed by
private respondent through itsrepresentative, Ms. Bautista, before the
MeTC.
The MeTC considered petitioners’ non
payment of rentals as unjustified. The court
held that mere willingness to pay the rent
did not amount to payment of the obligation
The court did not give credence t
petitioners’ claim that private respondentfailed to turn over possession of the
premises. The court, however, dismissed
the complaint because of Ms. Bautista’s
alleged lack of authority to sue on behalf of
the corporation.
The RTC of Manila reversed and set aside the
MeTC Decision. It adopted the MeTC’s
finding on petitioners’ unjustified refusal topay the rent, which is a valid ground for
ejectment. It, however, it upheld Ms
Bautista’s authority to represent respondent
notwithstanding the absence of a board
resolution to that effect, since her authority
was implied from her power as a genera
manager/treasurer of the company.
The CA affirmed the RTC Decision budeleted the award of attorney’s fees.
ISSUE 1: WON RESPONDENT COMPANY
HAS STANDING TO SUE
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DECISION: Yes
RATIO:
Although the SEC suspended and eventually
revoked respondent’s certificate of
registration on February 16, 1995, records
show that it instituted the action for
ejectment on December 15, 1993.
Accordingly, when the case was
commenced, its registration was not yet
revoked. Besides, the SEC later set aside its
earlier orders of suspension and revocation
of respondent’s certificate, rendering the
issue moot and academic.
ISSUE 2: WON MS. BAUTISTA HAS
CAPACITY TO SUE IN BEHALF OF THE
COMPANY
DECISION: Yes
RATIO:
A corporation has no powers except those
expressly conferred on it by the Corporation
Code and those that are implied from or are
incidental to its existence. In turn, a
corporation exercises said powers through
its board of directors and/or its duly
authorized officers and agents. Physical
acts, like the signing of documents, can be
performed only by natural persons duly
authorized for the purpose by corporate by-
laws or by a specific act of the board of
directors. Thus, any person suing on behalf
of the corporation should present proof of
such authority.
Although Ms. Bautista initially failed to show
that she had the capacity to sign the
verification and institute the ejectment case
on behalf of the company, when confronted
with such question, she immediately
presented the Secretary’s Certificate
confirming her authority to represent the
company. There is ample jurisprudence
holding that subsequent and substantia
compliance may call for the relaxation of the
rules of procedure in the interest of justice
In Novelty Phils., Inc. v. Court of Appeals,
the Court faulted the appellate court for
dismissing a petition solely on petitioner’s
failure to timely submit proof of authority to
sue on behalf of the corporation. In Pfizer,
Inc. v. Galan, we upheld the sufficiency of apetition verified by an employment specialist
despite the total absence of a board
resolution authorizing her to act for and on
behalf of the corporation. Lastly, in China
Banking Corporation v. Mondragon
International Philippines, Inc, we relaxed the
rules of procedure because the corporation
ratified the manager’s status as an
authorized signatory. In all of the above
cases, we brushed aside technicalities in theinterest of justice. This relaxation of the
rules applies only to highly meritorious
cases, and when there is substantia
compliance.
ISSUE 3: WON THE DENIAL OF THE
MOTION TO INHIBIT CA JUSTICE RUBEN
REYES IS PROPER
DECISION: Yes
RATIO:
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First, the motion to inhibit came after the
appellate court rendered the assailed
decision, that is, after Justice Reyes had
already rendered his opinion on the merits of
the case. It is settled that a motion to inhibit
shall be denied if filed after a member of the
court had already given an opinion on the
merits of the case, the rationale being that“a litigant cannot be permitted to speculate
on the action of the court x x x (only to)
raise an objection of this sort after the
decision has been rendered.”
Second, it is settled that mere suspicion that
a judge is partial to one of the parties is not
enough; there should be evidence to
substantiate the suspicion. Bias andprejudice cannot be presumed, especially
when weighed against a judge’s sacred
pledge under his oath of office to administer
justice without regard for any person and to
do right equally to the poor and the rich.
There must be a showing of bias and
prejudice stemming from an extrajudicial
source, resulting in an opinion on the merits
based on something other than what the
judge learned from his participation in the
case.
ISSUE 4: WON THE PETITIONERS MAY
BE VALIDLY EJECTED FROM THE LEASED
PREMISES
DECISION: Yes
RATIO:
Unlawful detainer cases are summary in
nature. In such cases, the elements to be
proved and resolved are the fact of lease
and the expiration or violation of its terms.
Specifically, the essential requisites o
unlawful detainer are: 1) the fact of lease by
virtue of a contract, express or implied; 2)
the expiration or termination of the
possessor’s right to hold possession; 3
withholding by the lessee of possession of
the land or building after the expiration ortermination of the right to possess; 4) letter
of demand upon lessee to pay the rental or
comply with the terms of the lease and
vacate the premises; and 5) the filing of the
action within one year from the date of the
last demand received by the defendant.[49]
It is undisputed that petitioners and
respondent entered into two separatecontracts of lease involving nine (9) rooms of
the San Luis Building. Records, likewise
show that respondent repeatedly demanded
that petitioners vacate the premises, but the
latter refused to heed the demand; thus
they remained in possession of the
premises. The only contentious issue is
whether there was indeed a violation of the
terms of the contract.
This issue involves questions of fact, the
resolution of which requires the evaluation of
the evidence presented. The MeTC, the RTC
and the CA all found that petitioners failed to
perform their obligation to pay the stipulated
rent. It is settled doctrine that in a civi
case, the conclusions of fact of the tria
court, especially when affirmed by the Court
of Appeals, are final and conclusive, and
cannot be reviewed on appeal by the
Supreme Court.
Petitioners’ justifications are belied by the
evidence on record. As correctly held by the
CA, petitioners’ communications to
respondent prior to the filing of the
complaint never mentioned their alleged
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same prior to their assignment as security
for the loan; and (2) that respondent is not a
resident of the Philippines.
The trial court granted the application and
issued the writ ex parte after PCIB posted a
Php 18.7M bond, issued by PrudentialGuarantee & Assurance Inc. Also, the bank
deposits of Alejandro with RCBC were
garnished. Alejandro, through counsel,
voluntarily submitted to the jurisdiction of
the court.
Subsequently, Alejandro filed a motion to
quash the writ contending that the
withdrawal of his unassigned deposits wasnot fraudulent as it was approved by PCIB.
He also alleged that petitioner knew that he
maintains a permanent residence at Calle
Victoria, Ciudad Regina, Batasan Hills,
Quezon City, and an office address in Makati
City at the Law Firm Romulo Mabanta
Buenaventura Sayoc & De los Angeles,
where he is a partner. In both addresses,
petitioner regularly communicated with him
through its representatives. Respondentadded that he is the managing partner of
the Hong Kong branch of said Law Firm; that
his stay in Hong Kong is only temporary; and
that he frequently travels back to the
Philippines.
The trial court issued an order quashing the
writ and holding that the withdrawal of
respondent’s unassigned deposits was notintended to defraud petitioner. It also found
that the representatives of petitioner
personally transacted with respondent
through his home address in Quezon City
and/or his office in Makati City. It thus
concluded that petitioner misrepresented
and suppressed the facts regarding
respondent’s residence considering that it
has personal and official knowledge that for
purposes of service of summons
respondent’s residence and office addresses
are located in the Philippines.
With the denial of PCIB’s motion for
reconsideration, it elevated the case to the
CA via a petition for certiorari. The petitionwas dismissed for failure to prove that the
trial court abused its discretion in issuing the
aforesaid order. PCIB filed a motion fo
reconsideration but was denied. On petition
with the SC, the case was dismissed for late
filing. PCIB filed a motion for
reconsideration but was likewise denied
with finality on March 6, 2000.
Complaint for damages (SECOND CASE
AND CASE BEFORE THE COURT)
Meanwhile, on May 20, 1998, Alejandro filed
for damages in the amount of P25 Million on
the attachment bond posted by Prudentia
Guarantee & Assurance, Inc. on account of
the wrongful garnishment of his deposits
He presented evidence showing that his
P150,000.00 RCBC check payable to his
counsel as attorney’s fees, was dishonored
by reason of the garnishment of his depositsHe also testified that he is a graduate of the
Ateneo de Manila University in 1982 with a
double degree of Economics and
Management Engineering and of the
University of the Philippines in 1987 with the
degree of Bachelor of Laws. Respondent
likewise presented witnesses to prove that
he is a well known lawyer in the business
community both in the Philippines and in
Hong Kong.
The trial court awarded damages t
Alejandro in the amount of P25 Million
without specifying the basis thereof. It also
denied petitioner’s motion for
reconsideration.
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PCIB elevated the case to the CA which
affirmed the findings of the trial court. It
held that in claiming that respondent was
not a resident of the Philippines, petitioner
cannot be said to have been in good faith
considering that its knowledge of
respondent’s Philippine residence and office
address goes into the very issue of the trialcourt’s jurisdiction which would have been
defective had respondent not voluntarily
appeared before it. The CA, however,
reduced the amount of damages awarded to
petitioner and specified their basis: P2M as
nominal damages; P5M as moral damages;
and P1M as attorney’s fees, to be satisfied
against the attachment bond under
Prudential Guarantee & Assurance, Inc.
Both parties moved for reconsideration. The
CA denied PCIB’s motion for reconsideration
but granted that of Alejandro’s by ordering
PCIB to pay additional P5M as exemplary
damages.
ISSUE 1: WON THE COURT CAN PASS
UPON THE ISSUES OF PROPRIETY OF
THE ISSUANCE OF A WRIT OF
ATTACHMENT, MISREPRESENTATION BY
PCIB AND RESIDENCE OF ALEJANDRO
DECISION: No.
RATIO:
The ruling of the trial court that PCIB is not
entitled to a writ of attachment because
Alejandro is a resident of the Philippines,
that his act of withdrawing his deposits with
petitioner was without intent to defraud, and
that PCIB misrepresented that Alejandro was
residing out of the Philippines, is now
beyond the power of this Court to review,
having been the subject of a final and
executory order. The rule on conclusiveness
of judgment precludes the relitigation of a
particular fact or issue in another action
between the same parties even if based on a
different claim or cause of action. The judgment in the prior action operates as
estoppel as to those matters in issue o
points controverted, upon the determination
of which the finding or judgment was
rendered. Hence, the issues of
misrepresentation by petitioner and the
residence of respondent for purposes o
service of summons can no longer be
questioned by petitioner in this case.
ISSUE 2: WON PCIB IS LIABLE FOR
DAMAGES FOR THE IMPROPER
ISSUANCE OF THE WRIT OF
ATTACHMENT AGAINST ALEJANDRO
DECISION: Yes.
RATIO:
PCIB is barred by the principle of
conclusiveness of judgment from
invoking good faith in the application
for a writ of attachment in order to
avoid liability for damages
The trial court settled in its final order the
two grounds invoked by PCIB for the
issuance of a writ for preliminary
attachment. Contrary to the assertions of
PCIB, Alejandro is a resident of the
Philippines, and he did not withdraw his
deposits from PCIB with intent to defraud
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creditors. Firstly, in the hearings of the
motion, and oral arguments of counsels
before the SC, it appeared that PCIB
personally transacted with Alejandro mainly
through the latter’s Metro Manila residence,
either in Alejandro’s home address in
Quezon City or his main business address at
the ROMULO MABANTA BUENAVENTURASAYOC & DELOS ANGELES in Makati. Thus
PCIB could not deny personal and official
knowledge that Alejandro’s residence for
purposes of service of summons is in the
Philippines. Secondly, the amount
withdrawn by Alejandro from PCIB was not
part of his peso deposits assigned with the
bank to secure the loan. Proof that the
withdrawal was not intended to defraud PCIB
as creditor is that plaintiff approved and
allowed said withdrawals. Moreover, the
tenor of the final order of the trial court
which quashed the writ evidently considers
PCIB to have acted in bad faith by resorting
to a deliberate strategy to mislead the court.
Thus, PCIB cannot again invoke good faith in
the present case since such issue was
already aired and squarely ruled upon in the
first case. Similarly, in the case of Hanil
Development Co., Ltd. v. Court of Appeals,
the Court debunked the claim of good faithby a party who maliciously sought the
issuance of a writ of attachment, the bad
faith of said party having been previously
determined in a final decision which voided
the assailed writ.
Discussion on when attachment is
proper as a means for the court to
acquire jurisdiction (over the res, not over the non-resident defendant)
The circumstances under which a writ of
preliminary attachment may be issued are
set forth in Section 1, Rule 57 of the Rules of
Court, to wit:
SEC. 1. Grounds upon
which attachment may issue. —
At the commencement of the
action or at any time before
entry of judgment, a plaintiff or
any proper party may have the
property of the adverse party
attached as security for thesatisfaction of any judgment
that may be recovered in the
following cases:
f) In an action
against a party who resides out
of the Philippines, or on whom
summons may be served by
publication.
The purposes of preliminary attachment are
(1) to seize the property of the debtor in
advance of final judgment and to hold it for
purposes of satisfying said judgment, as in
the grounds stated in paragraphs (a) to (e)
of Section 1, Rule 57 of the Rules of Court; or
(2) to acquire jurisdiction over the action by
actual or constructive seizure of the propertyin those instances where personal o
substituted service of summons on the
defendant cannot be effected, as in
paragraph (f) of the same provision.
Corollarily, in actions in personam, such as
the case for collection of sum of money
summons must be served by personal o
substituted service, otherwise the court wilnot acquire jurisdiction over the defendant
In case the defendant does not reside
and is not found in the Philippines (and
hence personal and substituted service
cannot be effected), the remedy of the
plaintiff in order for the court to
acquire jurisdiction to try the case is to
convert the action into a proceeding in
rem or quasi in rem by attaching the
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property of the defendant. The service
of summons in this case (which may be
by publication coupled with the sending
by registered mail of the copy of the
summons and the court order to the
last known address of the defendant),
is no longer for the purpose of
acquiring jurisdiction but forcompliance with the requirements of
due process.
Discussion on the propriety of issuing a
writ of attachment / proper mode of
service in the case of a resident
temporarily out of the Philippines
PCIB seeks to nuance its argument by saying
that it considers Alejandro a resident
temporarily out of the Philippines such that
attachment is still a proper and available
remedy.
However, the SC held that where thedefendant is a resident who is temporarily
out of the Philippines, attachment of his/her
property in an action in personam, is not
always necessary in order for the court to
acquire jurisdiction to hear the case.
Section 16, Rule 14 of the Rules of
Court reads:
Sec. 16. Residents
temporarily out of the
Philippines. – When an action is
commenced against a
defendant who ordinarily
resides within the Philippines,
but who is temporarily out of it,
service may, by leave of court,
be also effected out of the
Philippines, as under the
preceding section.
The preceding section referred to in theabove provision is Section 15 which provides
for extraterritorial service – (a) persona
service out of the Philippines, (b) publication
coupled with the sending by registered mai
of the copy of the summons and the court
order to the last known address of the
defendant; or (c) in any other manner which
the court may deem sufficient.
In Montalban v. Maximo, the Court held that
substituted service of summons (under
the present Section 7, Rule 14 of the Rules of
Court) is the normal mode of service of
summons that will confer jurisdiction on the
court over the person of residents
temporarily out of the Philippines. Meaning
service of summons may be effected by (a)
leaving copies of the summons at the
defendant’s residence with some person of
suitable discretion residing therein, or (b) by
leaving copies at the defendant’s office or
regular place of business with some
competent person in charge thereof. Hence
the court may acquire jurisdiction over an
action in personam by mere substituted
service without need of attaching the
property of the defendant.
The rules on the application of a writ o
attachment must be strictly construed in
favor of the defendant. For attachment is
harsh, extraordinary, and summary in
nature; it is a rigorous remedy which
exposes the debtor to humiliation and
annoyance. It should be resorted to only
when necessary and as a last remedy.
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In the instant case, it must be stressed that
the writ was issued by the trial court mainly
on the representation of petitioner that
respondent is not a resident of the
Philippines. Obviously, the trial court’s
issuance of the writ was for the sole purpose
of acquiring jurisdiction to hear and decide
the case. Had the allegations in thecomplaint disclosed that respondent has a
residence in Quezon City and an office in
Makati City, the trial court, if only for the
purpose of acquiring jurisdiction, could have
served summons by substituted service on
the said addresses, instead of attaching the
property of the defendant. The
misrepresentation of petitioner that
respondent does not reside in the Philippines
and its omission of his local addresses was
thus a deliberate move to ensure that the
application for the writ will be granted.
In light of the foregoing, the Court of
Appeals properly sustained the finding of the
trial court that petitioner is liable for
damages for the wrongful issuance of a writ
of attachment against respondent.
Discussion on damages
Anent the actual damages, the Court of
Appeals is correct in not awarding the same
inasmuch as the respondent failed to
establish the amount garnished by
petitioner. It is a well settled rule that one
who has been injured by a wrongful
attachment can recover damages for the
actual loss resulting therefrom. But for suchlosses to be recoverable, they must
constitute actual damages duly established
by competent proofs, which are, however,
wanting in the present case.
Nominal damages may be awarded to a
plaintiff whose right has been violated or
invaded by the defendant, for the purpose of
vindicating or recognizing that right, and not
for indemnifying the plaintiff for any loss
suffered by him. Its award is thus not for the
purpose of indemnification for a loss but for
the recognition and vindication of a right. In
this case, nominal damages is prope
considering that the right of respondent to
use his money has been violated by itsgarnishment. The amount of nomina
damages must, however, be reduced from
P2 million to P50,000.00 considering the
short period of 2 months during which the
writ was in effect as well as the lack o
evidence as to the amount garnished.
The award of attorney’s fees is proper when
a party is compelled to incur expenses to lifta wrongfully issued writ of attachment. The
basis of the award thereof is also the
amount of money garnished, and the length
of time respondents have been deprived of
the use of their money by reason of the
wrongful attachment. It may also be based
upon (1) the amount and the character of
the services rendered; (2) the labor, time
and trouble involved; (3) the nature and
importance of the litigation and business in
which the services were rendered; (4) the
responsibility imposed; (5) the amount of
money and the value of the property
affected by the controversy or involved in
the employment; (6) the skill and the
experience called for in the performance of
the services; (7) the professional character
and the social standing of the attorney; (8)
the results secured, it being a recognized
rule that an attorney may properly charge a
much larger fee when it is contingent thanwhen it is not. All the aforementioned
weighed, and considering the short period of
time it took to have the writ lifted, the
favorable decisions of the courts below, the
absence of evidence as to the professiona
character and the social standing of the
attorney handling the case and the amount
garnished, the award of attorney’s fees
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should be fixed not at P1 Million, but only at
P200,000.00.
The courts below correctly awarded moral
damages on account of petitioner’s
misrepresentation and bad faith; however,
we find the award in the amount of P5Million excessive. Moral damages are to be
fixed upon the discretion of the court taking
into consideration the educational, social
and financial standing of the parties. Moral
damages are not intended to enrich a
complainant at the expense of a defendant.
They are awarded only to enable the injured
party to obtain means, diversion or
amusements that will serve to obviate the
moral suffering he has undergone, by reasonof petitioner’s culpable action. Moral
damages must be commensurate with the
loss or injury suffered. Hence, the award of
moral damages is reduced to P500,000.00.
Considering petitioner’s bad faith in securing
the writ of attachment, we sustain the award
of exemplary damages by way of example or
correction for public good. While as ageneral rule, the liability on the attachment
bond is limited to actual (or in some cases,
temperate or nominal) damages, exemplary
damages may be recovered where the
attachment was established to be
maliciously sued out. Nevertheless, the
award of exemplary damages in this case
should be reduced from P5M to P500,000.00.
TITLE OF THE CASE: PEOPLE V.
TERRADO
DATE OF PROMULGATION: July 14, 2008
SUBJECT AREA: Criminal Procedure
KEY DOCTRINES/CONCEPTS: Specia
Civil Action for Certiorari in Crimina
Cases; Double Jeopardy
FACTS:
Accused Joseph Terrado was charged with
Carnapping under Republic Act 6538
otherwise known as the “Anti-Carnapping Act
of 1972.” According to the Information, the
accused carted away a motorized tricycle
after threatening the driver with a fan knife
The accused was arraigned and pleaded not
guilty to the crime charged.
The defense claimed that the accuse
merely borrowed the tricycle from its driver
Dalmacio. However, when accused was
about to return the same, he hit a stone, lost
control of the tricycle and bumped a tree
Three persons came and helped him bring
the tricycle back to the roadside. The
accused returned the tricycle at around11:00 pm of the same day to the Spouses
Garcia, owners of the tricycle. The defense
did not deny that the tricycle, when
returned, was damaged and, in fact, the
accused voluntarily paid the amount o
P8,000.00 as partial remuneration for the
repair of the tricycle.
The trial court acquitted accused Terrado forfailure of the prosecution to establish intent
to take the tricycle and intent to gain from
the same. Thus, the court held that the
prosecution failed to prove the guilt of the
accused beyond reasonable doubt.
The prosecution filed a Motion fo
Reconsideration which the trial court denied
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Aggrieved, the complainants come to this
Court via a Petition for Certiorari seeking to
annul and set aside the decision
ISSUE 1: WON THE PUBLIC
RESPONDENT IN RENDERING THE
QUESTIONED DECISION ACTED WITHGRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OF JURISDICTION.
DECISION: No.
RATIO:
The special civil action for certiorari is
intended for the correction of errors of
jurisdiction or grave abuse of discretion
amounting to lack or excess of jurisdiction.
Its principal office is to keep the inferior
court within the parameters of its jurisdiction
or to prevent it from committing such a
grave abuse of discretion amounting to lack
or excess of jurisdiction.
By grave abuse of discretion is meant such
capricious and whimsical exercise of
judgment as is equivalent to lack of
jurisdiction. The abuse of discretion must be
grave as where the power is exercised in an
arbitrary or despotic manner by reason of
passion or personal hostility and must be so
patent and gross as to amount to an evasion
of positive duty or to a virtual refusal to
perform the duty enjoined by or to act at all
in contemplation of law.
While petitioner alleges grave abuse of
discretion amounting to lack or excess of
jurisdiction, the imputation is premised on
the averment that the trial court reached its
conclusions based on speculation, surmises
and conjectures. As alleged by the
petitioners, the accused forcibly took the
vehicle from the complainant’s driver and
the public respondent acquitted the accused
for alleged failure to meet the element of
intent to gain. Specifically, the allegations
delve on the misapprehension of facts by thetrial court.
As a rule, factual matters cannot be
normally inquired into by the Supreme Court
in a certiorari proceeding. The present
recourse is a petition for certiorari unde
Rule 65. It is a fundamental aphorism in law
that a review of facts and evidence is not
the province of the extraordinary remedy ofcertiorari, which is extra ordinem – beyond
the ambit of appeal.
At least, the mistakes ascribed to the tria
court are not errors of jurisdiction correctible
by the special civil action for certiorari, but
errors of judgment, which is correctible by a
petition for review on certiorari under Rule
45 of the Revised Rules of Court. The merefact that a court erroneously decides a case
does not necessarily deprive it of
jurisdiction. Thus, assuming arguendo tha
the trial court committed a mistake in its
judgment, the error does not vitiate the
decision, considering that it has jurisdiction
over the case.
In our jurisdiction, availment of the remedyof certiorari to correct an erroneous acquitta
may be allowed in cases where petitioner
has clearly shown that the public respondent
acted without jurisdiction or with grave
abuse of discretion amounting to lack o
excess of jurisdiction. However, and more
serious than the procedural infraction, if the
petition merely calls for an ordinary review
of the findings of the court a quo, we would
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run afoul of the constitutional right against
double jeopardy. Such recourse is
tantamount to converting the petition for
certiorari into an appeal, which is proscribed
by the Constitution, the Rules of Court and
prevailing jurisprudence on double jeopardy.
Verdicts of acquittal are to be regarded as
absolutely final and irreviewable. Thefundamental philosophy behind the principle
is to afford the defendant, who has been
acquitted, final repose and to safeguard him
from government oppression through the
abuse of criminal processes.
[G.R. No. 178884, June 30, 2008]
RICARDO P. PRESBITERO, JR., JANET
PALACIOS, CIRILO G. ABRASIA,ARMANDO G. ALVAREZ, NENITO A.
ARMAS, RENE L. CORRAL, JOEMARIE A.
DE JUAN, ENRILICE C. GENOBIS,
WILLIAM A. PRESBITERO AND REYNO N.
SOBERANO, PETITIONERS, VS.
COMMISSION ON ELECTIONS, ROMMEL
YOGORE, GLORY GOMEZ, DAN YANSON,
JOENITO DURAN, SR., LUCIUS BODIOS
AND REY SUMUGAT, RESPONDENTS.
FACTS: The MCTC Valladolid-San Enrique-
Pulupandan, Negros Occidental ordered the
municipal election officer (EO) of Valladolid
to include the names of 946 individuals in
the list of qualified voters of the said
municipality for the May 2007 elections.
Prompted by the advice of COMELEC Manila
that decisions of trial courts of limited
jurisdiction in inclusion/exclusion cases
attain finality only after the lapse of five
days from receipt of notice sans any appeal
therefrom, the acting provincial election
supervisor (PES), directed the EO on May 13,
2007 not to comply with the MCTC order.
Thus, the said 946 were disallowed by the
board of election inspectors to vote. These
946 moved for the issuance of a TRO to
prevent the Municipal Board of Canvassers
from canvassing the election returns & from
proclaiming the winning candidates for the
local positions in the municipality. Such was
granted. However, the MBOC continued
canvassing & proclaimed the winning
candidates. Presbitero et al thus filed before
the COMELEC a pet. for declaration of failure
of election and the holding of a specia
election because 946 voters weredisenfranchised, the Election Officer of the
municipality (also the ef-officio chair of the
MBOC) was abruptly replaced, the # of
voters was unusually low, no less than 2,000
supporters of petitioners failed to vote as
their names were missing from the list of
voters, the MBOC defied the TRO, and the
acting provincial election supervisor and
acting election officer threated & coerced
the vice-chair & member-secretary of the
MBOC to continue w/ the canvassing & the
proclamation.
ISSUE: WHETHER OR NOT THERE WAS A
FAILURE OF ELECTION.
HELD: NO. THERE WAS NO FAILURE OF
ELECTION.
RATIO: A failure of election may be declared
only in the three instances stated in Section
6 of the OEC: the election has not been
held; the election has been suspended
before the hour fixed by law; and the
preparation and the transmission of the
election returns have given rise to the
consequent failure to elect, meaning nobodyemerged as the winner. Furthermore, the
reason for such failure of election should be
force majeure, violence, terrorism, fraud or
other analogous causes. Finally, before the
COMELEC can grant a verified petition
seeking to declare a failure of election, the
concurrence of 2 conditions must be
established, namely: (1) no voting has taken
place in the precincts concerned on the date
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fixed by law or, even if there was voting, the
election nevertheless resulted in a failure to
elect; and (2) the votes cast would affect the
result of the election.
In the instant case, it is admitted by the
petitioners that elections were held in the
subject locality. Also, the private
respondents and four of the petitioners won
in the elections and were proclaimed as the
duly elected municipal officials. There is
nothing in the records from which the Court
can make even a slim deduction that there
has been a failure to elect. Absent any proof
that the voting did not take place, the
alleged disenfranchisement of the 946
individuals and 2,000 more supporters of the
petitioners cannot even be considered as abasis for the declaration of a failure of
election. Had petitioners been aggrieved by
the allegedly illegal composition and
proceedings of the MBOC, then they should
have filed the appropriate pre-proclamation
case contesting the aforesaid composition or
proceedings of the board, rather than
erroneously raising the same as grounds for
the declaration of failure of election. On the
TRO issued by the MCTC and the subsequent
defiance thereof by the MBOC, suffice it to
state that the propriety of suspending the
canvass of returns or the proclamation of
candidates is a pre-proclamation issue that
is solely within the cognizance of the
COMELEC.[21] In sum, petitioners have not
adduced any ground which will warrant a
declaration of failure of election.
TITLE OF THE CASE: SALVADOR V. MAPA
DATE OF PROMULGATION: November
28, 2007
SUBJECT AREA: Civil Procedure;
Criminal Law
KEY DOCTRINES/CONCEPTS: Specia
Civil Action for Certiorari (Rule 65) vs
Petition for Review on Certiorari (Rule
45); Prescription; Ex Post Facto Laws
FACTS:
On October 8, 1992 then President Fidel V
Ramos issued Administrative Order No. 13
creating the Presidential Ad Hoc Fact-Finding
Committee on Behest Loans. Behest loans
are loans granted by government banks or
GOCC at the behest, command, or urging by
previous government officials to thedisadvantage of the Philippine government
The Committee was tasked to inventory al
behest loans and determine the courses of
action that the government should take to
recover these loans.
By Memorandum Order No. 61 dated
November 9, 1992, the functions of the
Committee were expanded to include alnon-performing loans which shall embrace
behest and non-behest loans. Said
Memorandum also named criteria to be
utilized as a frame of reference in
determining a behest loan
Several loan accounts were referred to the
Committee for investigation, including the
loan transactions between MetalsExploration Asia, Inc. (MEA), now Philippine
Eagle Mines, Inc. (PEMI) and the
Development Bank of the Philippines (DBP)
The Committee determined that they bore
the characteristics of behest loans, as
defined under Memorandum Order No. 61
because the stockholders and officers of
PEMI were known cronies of then President
Ferdinand Marcos; the loan was under-
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collateralized; and PEMI was
undercapitalized at the time the loan was
granted.
Consequently, Atty. Orlando L. Salvador,
Consultant of the Fact-Finding Committee,
and representing the PCGG, filed with theOmbudsman a sworn complaint for violation
of Sections 3(e) and (g) of Republic Act No.
3019, or the Anti-Graft and Corrupt Practices
Act, against the respondents Mapa, Jr. et. al.
The Ombudsman dismissed the complaint on
the ground of prescription. It stressed that
Section 11 of R.A. No. 3019 as originally
enacted, provides that the prescriptiveperiod for violations of the said Act (R.A.
3019) is ten (10) years. Moreover, the
computation of the prescriptive period of a
crime violating a special law like R.A. 3019 is
governed by Act No. 3326 which provides
that prescription shall begin to run from the
day of the commission of the violation of
law, and if the same be not known at the
time, from the discovery thereof and the
institution of the judicial proceedings for itsinvestigation and punishment. Corollary
thereto, the Supreme Court in the case of
People vs. Dinsay, C.A. 40 O.G. 12th Supp.,
50, ruled that when there is nothing which
was concealed or needed to be discovered
because the entire series of transactions
were by public instruments, the period of
prescription commenced to run from the
date the said instrument were executed.
In the case at bar, the loans were entered
into by virtue of public documents (e.g.,
notarized contracts, board resolutions,
approved letter-request) during the period of
1978 to 1981. Records show that the
complaint was referred and filed with the
Ombudsman on October 4, 1996 or after the
lapse of more than fifteen years from the
violation of the law. Therefore, the offenses
charged had already prescribed.
Also pointed out was that the Presidential Ad
Hoc Committee on Behest Loans was
created on October 8, 1992 under
Administrative Order No. 13. SubsequentlyMemorandum Order No. 61, dated
November 9, 1992, was issued defining the
criteria to be utilized as a frame of reference
in determining behest loans. Accordingly, i
these Orders are to be considered the bases
of charging respondents for alleged offenses
committed, they become ex-post facto laws
which are proscribed by the Constitution.
The Committee filed a Motion fo
Reconsideration, but the Ombudsman
denied it on July 27, 1998.
ISSUE 1: WON THE PRESENT PETITION
FOR REVIEW ON CERTIORARI SHOULD
BE DISMISSED FOR BEING THE WRONGREMEDY IN ELEVATING THE CASE TO
THE SC.
DECISION: No.
RATIO:
A petition for review on certiorari under Rule
45 is not the proper mode by which
resolutions of the Ombudsman in preliminary
investigations of criminal cases are reviewed
by the SC. The remedy from the adverse
resolution of the Ombudsman is a petition
for certiorari under Rule 65.
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However, though captioned as a Petition for
Review on Certiorari, the SC treated the
petition as one filed under Rule 65 since a
reading of its contents reveals that petioner
imputes grave abuse of discretion to the
Ombudsman for dismissing the complaint.
The averments in the complaint, not the
nomenclature given by the parties,determine the nature of the action.
ISSUE 2: WON THE CRIME
DEFINED BY SEC. 3(e) AND (g) OF
R.A. 3019 HAS ALREADY
PRESCRIBED
DECISION: No
RATIO:
It is well-nigh impossible for the State
to have known the violations of R.A.
No. 3019 at the time the questionedtransactions were made because the
public officials concerned connived or
conspired with the beneficiaries of the
loans. Thus, the prescriptive period
should be computed from the
discovery of the commission thereof
and not from the day of such
commission.
ISSUE 3: WON ADMINISTRATIVE
ORDER NO. 13 AND
MEMORANDUM ORDER NO. 61
ARE EX-POST FACTO LAW[S].
DECISION: No.
RATIO:
The SC did not sustain the Ombudsman’
declaration that Administrative Order No. 13
and Memorandum Order No. 61 violate theprohibition against ex post facto laws fo
ostensibly inflicting punishment upon a
person for an act done prior to their issuance
and which was innocent when done.
The constitutionality of laws is presumed. To
justify nullification of a law, there must be a
clear and unequivocal breach of the
Constitution, not a doubtful or arguableimplication. Furthermore, the Ombudsman
has no jurisdiction to entertain questions on
the constitutionality of a law. The
Ombudsman, therefore, acted in excess of
its jurisdiction in declaring unconstitutiona
the subject administrative and
memorandum orders.
In any event, the SC held that AdministrativeOrder No. 13 and Memorandum Order No. 61
are not ex post facto laws.
An ex post facto law has been defined as
one — (a) which makes an action done
before the passing of the law and which was
innocent when done criminal, and punishes
such action; or (b) which aggravates a crime
or makes it greater than it was whencommitted; or (c) which changes the
punishment and inflicts a greater
punishment than the law annexed to the
crime when it was committed; or (d) which
alters the legal rules of evidence and
receives less or different testimony than the
law required at the time of the commission
of the offense in order to convict the
defendant. This Court added two (2) more to
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the list, namely: (e) that which assumes to
regulate civil rights and remedies only but in
effect imposes a penalty or deprivation of a
right which when done was lawful; or (f) that
which deprives a person accused of a crime
of some lawful protection to which he has
become entitled, such as the protection of a
former conviction or acquittal, or aproclamation of amnesty.
The constitutional doctrine that outlaws an
ex post facto law generally prohibits the
retrospectivity of penal laws. Penal laws are
those acts of the legislature which prohibit
certain acts and establish penalties for their
violations; or those that define crimes, treat
of their nature, and provide for theirpunishment. The subject administrative and
memorandum orders clearly do not come
within the shadow of this definition.
Administrative Order No. 13 creates the
Presidential Ad Hoc Fact-Finding Committee
on Behest Loans, and provides for its
composition and functions. It does not mete
out penalty for the act of granting behest
loans. Memorandum Order No. 61 merely
provides a frame of reference for
determining behest loans. Not being penal
laws, Administrative Order No. 13 and
Memorandum Order No. 61 cannot be
characterized as ex post facto laws.
Title of the Case: Sps Santos v Heirs of LustreAugust 6, 2008 NACHURA
CivPro: forum shopping, prescription
Facts:
Lustre owned a lot which she mortgaged &
later on sold to Natividad Santos who
subsequently sold it to her son Froilan for
which a TCT was issued in his name.
Lustre’s heirs Macaspac & Maniquiz filed w/
RTC of Gapan, Nueva Ecija a Complaint for
Declaration of the Inexistence of Contract,
Annulment of Title, Reconveyance and
Damages against Froilan Santos.
Lustre’s other heirs filed a Complaint for
Annulment of Transfer Certificate of Title and
Deed of Absolute Sale against spouses
Santos, Froilan Santos, R Transport Corp,
Cecilia Macaspac with the same RTC.
Macaspac was impleaded as defendant in
the 2nd case because she refused to join the
other heirs as plaintiffs.
Alleging that the plaintiffs’ right of action for
annulment of the Deed of Sale and TCT had
long prescribed and was barred by laches,
petitioners filed a Motion to Dismiss, also on
the ground of litis pendentia.
The RTC denied the Motion to Dismiss. They
then filed a petition for certiorari with theCourt of Appeals (CA) which dismissed the
petition for lack of merit.
Issue #1: Was there forum shopping
Decision: No
Ratio:
Forum shopping exists when the elements oflitis pendentia are present or when a final
judgment in one case will amount to res
judicata in the other. Its elements are
identity of the subject matter, identity of the
causes of action and identity of the parties
in the two cases. There is substantial
identity of parties when there is a
community of interest between a party in
the first case and a party in the second case.
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There is no forum shopping because there is
no identity of parties because the plaintiff in
the 1st case (Macaspac) does not, in fact,
share a common interest with the plaintiffs
in the 2nd case.
Plaintiffs in both cases are the heirs of
Lustre; they are therefore co-owners of the
property. However, the fact of being a co-
owner does not necessarily mean that a
plaintiff is acting for the benefit of the co-
ownership when he files an action respecting
the co-owned property. Co-owners are not
parties inter se in relation to the property
owned in common. The test is whether the
“additional” party, the co-owner in this case,
acts in the same capacity or is in privity with
the parties in the former action. [28]
Macaspac filed the 1st case seeking the
reconveyance of the property to her, and not
to Lustre or her heirs. This is a clear act of
repudiation of the co-ownership which would
negate a conclusion that she acted in privity
with the other heirs or that she filed the
complaint in behalf of the co-ownership. In
contrast, respondents were evidently acting
for the benefit of the co-ownership when
they filed the 2nd case wherein they prayed
that TCT Lustre be reinstated, or a new
certificate of title be issued in her name.
Issue #1: Does prescription or laches apply?
Decision: No
Ratio:
The action for reconveyance on the ground
that the certificate of title was obtained by
means of a fictitious deed of sale is virtually
an action for the declaration of its nullity,
which does not prescribe. Moreover, a
person acquiring property through fraud
becomes, by operation of law, a trustee of
an implied trust for the benefit of the real
owner of the property. An action for
reconveyance based on an implied trust
prescribes in ten years. And in such case,
the prescriptive period applies only if thereis an actual need to reconvey the property
as when the plaintiff is not in possession of
the property. Otherwise, if plaintiff is in
possession of the property, prescription does
not commence to run against him. Thus,
when an action for reconveyance is
nonetheless filed, it would be in the nature
of a suit for quieting of title, an action that is
imprescriptible.
It follows then that the respondents’ present
action should not be barred by laches.
Laches is a doctrine in equity, which may be
used only in the absence of, and never
against, statutory law. Obviously, it cannot
be set up to resist the enforcement of an
imprescriptible legal right.[39]
Title of the Case: Tabuada v Hon Ruiz June 27, 2008 NACHURA
SpecPro: non-contentious nature of special
proceedings, compromise/amicable
settlement
Facts:
In the proceedings for the settlement of theintestate estate, trial court issued the
following Order:
In view of the strong manifestation of the
parties herein and their respective counsel
that they will be able to raise (sic) an
amicable settlement, finally, on or before 25
December 2004, the Court will no longer be
setting the pending incidents for hearing as
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the parties and their counsel have assured
this Court that they are going to submit a
“Motion for Judgment Based On An Amicable
Settlement” on or before 25 December
2004.
The RTC, invoking Section 3,[5] Rule 17, of the Rules of Court, terminated the
proceedings on account of the parties’
failure to submit the amicable settlement
and to comply with its Order.
Issue #1: Was the termination of the case
premature?
Decision: Yes
Ratio:
While a compromise agreement or an
amicable settlement is very strongly
encouraged, the failure to consummate one
does not warrant any procedural sanction,
much less provide an authority for the court
to jettison the case. The case should not
have been terminated or dismissed by the
trial court on account of the mere failure of the parties to submit the promised amicable
settlement and/or the Motion for Judgment
Based On An Amicable Settlement. Given
the non-contentious nature of special
proceedings[11] (which do not depend on
the will of an actor, but on a state or
condition of things or persons not entirely
within the control of the parties interested),
its dismissal should be ordered only in the
extreme case where the termination of the
proceeding is the sole remedy consistent
with equity and justice, but not as a penalty
for neglect of the parties therein.
The third clause of Section 3, Rule 17, which
authorizes the motu propio dismissal of a
case if the plaintiff fails to comply with the
rules or any order of the court,[13] cannot
even be used to justify the convenient,
though erroneous, termination of the
proceedings herein. The RTC, in its Order,
neither required the submission of the
amicable settlement or the aforesaid Motion
for Judgment, nor warned the parties that
should they fail to submit the compromise
within the given period, their case would bedismissed. Hence, it cannot be categorized
as an order requiring compliance to the
extent that its defiance becomes an affront
to the court and the rules. And even if it
were worded in coercive language, the
parties cannot be forced to comply, for, as
aforesaid, they are only strongly
encouraged, but are not obligated, to
consummate a compromise. An order
requiring submission of an amicable
settlement does not find support in our
jurisprudence and is premised on an
erroneous interpretation and application of
the law and rules.
MAYOR JOSE UGDORACION, JR. vCOMMISSION ON ELECTIONS andEPHRAIM M. TUNGOLApril 18, 2008, NACHURA
PUB OFF
• Acquisition of a permanent residentstatus abroad constitutes an abandon-ment of domicile and residence in thePhilippines. Thus, the “green card”status in the USA is a renunciation of one’s status as a resident of the Phil-ippines.
• Domicile is the place where one actu-
ally or constructively has his perman-ent home, where he, no matter wherehe may be found at any given time,eventually intends to return (animus
revertendi) and remain (animus man-endi).
• Domicile is classified into (1) domicile
of origin, which is acquired by everyperson at birth; (2) domicile of choice,which is acquired upon abandonmentof the domicile of origin; and (3) domi-cile by operation of law, which the lawattributes to a person independentlyof his residence or intention.
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FACTS Jose Ugdoracion and Ephraim Tungol wererival mayoralty candidates in Albuquerque,Bohol in the May 2007 elections. Tungol fileda petition to cancel Ugdoracion’s Certificateof Candidacy contending that the latter’sdeclaration of eligibility for Mayor
constituted material misrepresentation; thathe is actually a “green card” holder or apermanent resident of the US. It appearsthat Ugdoracion became a permanent USresident on September 26, 2001 and wasissued an Alien Number by the USINS.Ugdoracion, on the other hand, presentedthe following documents as proof of hissubstantial compliance with the residencyrequirement: (1) a residence certificate; (2)an application for a new voter’s registration;and (3) a photocopy of Abandonment of
Lawful Permanent Resident Status. COMELECcancelled Ugdoracion’s COC and removedhis name from the certified list of candidatesfor Mayor. His motion for recon was denied.Hence, the petition imputing grave abuse of discretion to the COMELEC.
ISSUE #1Whether there is material misrepresentationwhich is a valid ground for the cancellationof Ugdoracion’s COC
DECISION YES
RATIOSection 74, in relation to Section 78 of theOmnibus Election Code, requires that thefacts stated in the COC must be true, andany false representation therein of amaterial fact shall be a ground forcancellation thereof, thus:
SEC. 74. Contents of certificateof candidacy. — The certificateof candidacy shall state thatthe person filing it isannouncing his candidacy forthe office stated therein andthat he is eligible for said office;if for Member of the BatasangPambansa, the province,including its component cities,highly urbanized city or district
or sector which he seeks torepresent; the political party towhich he belongs; civil status;his date of birth; residence; hispost office address for allelection purposes; hisprofession or occupation; thathe will support and defend the
Constitution of the Philippinesand will maintain true faith andallegiance thereto; that he willobey the laws, legal orders, anddecrees promulgated by theduly constituted authorities;that he is not a permanentresident or immigrant to aforeign country; that theobligation assumed by his oathis assumed voluntarily, withoutmental reservation or purpose
of evasion; and that the factsstated in the certificate of candidacy are true to the bestof his knowledge.
x x x x
SEC. 78. Petition to deny duecourse to or cancel a certificateof candidacy. – A verifiedpetition seeking to deny duecourse or to cancel a certificate
of candidacy may be filed byany person exclusively on theground that any materialrepresentation containedtherein as required underSection 74 hereof is false. Thepetition may be filed at anytime not later than twenty-fivedays from the time of the filingof the certificate of candidacyand shall be decided, after duenotice and hearing not later
than fifteen days before theelection.
The false representation contemplated bySection 78 of the Code pertains to materialfact, and is not simply an innocuous mistakeA material fact refers to a candidate’squalification for elective office such as one’scitizenship and residence. Aside from therequirement of materiality, a false
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representation under Section 78 mustconsist of a “deliberate attempt to mislead,misinform, or hide a fact which wouldotherwise render a candidate ineligible.”
Section 74 specifically requires a statementin the COC that the candidate is “not apermanent resident or an immigrant to a
foreign country.” Ugdoracion explicitly statedin his COC that he had resided inAlbuquerque, Bohol before the May 2007elections for 41 years. Even if Ugdoracionmight have been of the mistaken belief thathe remained a resident of the Philippines, hehid the fact of his immigration to the USAand his status as a “green card” holder.
Although Ugdoracion have won the electionas Mayor of Albuquerque before, it does notsubstitute for the specific requirements of
law on a person’s eligibility for public officewhich he lacked, and does not cure hismaterial misrepresentation which is a validground for the cancellation of his COC.
ISSUE #2Whether Ugdoracion lost his domicile of origin
DECISION YES
RATIOResidence, in contemplation of election laws,is synonymous to domicile. Domicile is theplace where one actually or constructivelyhas his permanent home, where he, nomatter where he may be found at any giventime, eventually intends to return (animusrevertendi) and remain (animus manendi).
Domicile is classified into (1) domicile of origin, which is acquired by every person at
birth; (2) domicile of choice, which isacquired upon abandonment of the domicileof origin; and (3) domicile by operation of law, which the law attributes to a personindependently of his residence or intention.
We are guided by three basic rules: (1) aman must have a residence or domicilesomewhere; (2) domicile, once established,remains until a new one is validly acquired;
and (3) a man can have but one residence ordomicile at any given time.
The general rule is that the domicile of originis not easily lost; it is lost only when there isan actual removal or change of domicile, abona fide intention of abandoning the formerresidence and establishing a new one, and
acts which correspond with such purpose. Inthe instant case, however, Ugdoracion’sacquisition of a lawful permanent residentstatus in the US amounted to anabandonment and renunciation of his statusas a resident of the Philippines; itconstituted a change from his domicile of origin, which was Albuquerque, Bohol, to anew domicile of choice, which is the USA.
Title of the Case: Unlad v Dragon
June 27, 2008 NACHURA
ObliCon: jurisdiction, rescission
Facts: The parties entered in a Memorandum
of Agreement: respondents as controlling
stockholders of the Rural Bank shall allow
Unlad Resources to subscribe to a minimum
of P480, 000 common or preferred non-
voting shares of stock with a total par valueof P4.8 M and pay up immediately P1.2M for
said subscription; that the respondents,
upon the signing of the said agreement shall
transfer control and management over the
Rural Bank to Unlad Resources. The
respondents complied with their obligation
but the petitioners did not, thus respondents
filed a Complaint for rescission of the
agreement and the return of control and
management of the Rural Bank from
petitioners to respondents, plus damages.
RTC declared the MOA rescinded &ordered to
immediately return control and management
over the Rural to respondents. Petitioners
appealed to the CA which dismissed the
appeal for lack of merit.
Petitioners contend that the issues court are
intra-corporate in nature and are, therefore,
beyond the jurisdiction of the trial court.
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They point out that respondents' complaint
charged them with mismanagement and
alleged dissipation of the assets of the Rural
Bank.
Issue #1: Does RTC have jurisdiction over
the case?
Decision: Yes
Ratio:
The main issue in this case is the rescission
of the Memorandum of Agreement. This is to
be distinguished from respondents'
allegation of the alleged mismanagement
and dissipation of corporate assets by the
petitioners, which is based on the prayer forreceivership over the bank. The two issues,
albeit related, are obviously separate, as
they pertain to different acts of the parties
involved. The issue of receivership does not
arise from the parties' obligations under the
Memorandum of Agreement, but rather from
specific acts attributed to petitioners as
members of the Board of Directors of the
Bank. Clearly, the rescission of the
Memorandum of Agreement is a cause of
action within the jurisdiction of the trial
courts, notwithstanding the fact that the
parties involved are all directors of the same
corporation.
The petitioners insist that the trial court had
no jurisdiction over the complaint because
the issues involved are intra-corporate in
nature. This point has been rendered moot
by RA 8799, also known as the SecuritiesRegulation Code, which took effect in 2000,
transferred jurisdiction over such disputes to
the RTC.
Issue #2: Has the action prescribed?
Decision: No
Ratio:
Petitioners contend that the action for
rescission has prescribed under Article 1398
of the Civil Code, which provides: The action
to claim rescission must be commenced
within 4 years. This is an erroneous
proposition. Article 1389 specifically refers
to rescissible contracts as, clearly, this
provision is under the chapter entitled"Rescissible Contracts."
Article 1389 applies to rescissible contracts,
as enumerated and defined in Articles 1380
and 1381. The "rescission" in Article 1381 is
not akin to the term "rescission" in Article
1191 and Article 1592. In Articles 1191 and
1592, the rescission is a principal action
which seeks the resolution or cancellation of
the contract while in Article 1381, the action
is a subsidiary one limited to cases of
rescission for lesion as enumerated in said
article.
The prescriptive period applicable to
rescission under Articles 1191 and 1592, is
found in Article 1144, which provides that
the action upon a written contract should be
brought within ten years from the time the
right of action accrues.
Article 1381 sets out what are rescissible
contracts, to wit:
Article 1381. The following contracts are
rescissible:
(1) Those which are entered into by
guardians whenever the wards whom they
represent suffer lesion by more than one-
fourth of the value of the things which are
the object thereof;
(2) Those agreed upon in representation of absentees, if the latter suffer the lesion
stated in the preceding number;
(3) Those undertaken in fraud of creditors
when the latter cannot in any other manner
collect the claims due them;
(4) Those which refer to things under
litigation if they have been entered into by
the defendant without the knowledge and
approval of the litigants or of competent
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the contract, together with their fruits, and
the price with its interest; consequently, it
can be carried out only when he who
demands rescission can return whatever he
may be obligated to restore.
Neither shall rescission take place when the
things which are the object of the contractare legally in the possession of third persons
who did not act in bad faith.
In this case, indemnity for damages may be
demanded from the person causing the loss.
This Court has consistently ruled that this
provision applies to rescission under Article
1191:
[S]ince Article 1385 of the Civil Codeexpressly and clearly states that "rescission
creates the obligation to return the things
which were the object of the contract,
together with their fruits, and the price with
its interest," the Court finds no justification
to sustain petitioners' position that said
Article 1385 does not apply to rescission
under Article 1191.[15]
Rescission has the effect of "unmaking a
contract, or its undoing from the beginning,and not merely its termination."[16] Hence,
rescission creates the obligation to return
the object of the contract. It can be carried
out only when the one who demands
rescission can return whatever he may be
obliged to restore. To rescind is to declare a
contract void at its inception and to put an
end to it as though it never was. It is not
merely to terminate it and release the
parties from further obligations to eachother, but to abrogate it from the beginning
and restore the parties to their relative
positions as if no contract has been made.[17]
Accordingly, when a decree for rescission is
handed down, it is the duty of the court to
require both parties to surrender that which
they have respectively received and to place
each other as far as practicable in his
original situation. The rescission has the
effect of abrogating the contract in all
parts.[18]
Clearly, the petitioners failed to fulfill their
end of the agreement, and thus, there was
just cause for rescission. With the contract
thus rescinded, the parties must be restoredto the status quo ante, that is, before they
entered into the Memorandum of
Agreement.
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Primer on the SC Decision in Neri vs. Senate Committee
April 3, 2008 in CuRReNT IsSues Primer on the Supreme Court Decision inNeri vs. Senate Committee and its Implications
IN GENERAL:
What is the case of Neri vs. Senate Committee?
This case is about the Senate investigation of anomalies concerningthe NBN-ZTE project. During the hearings, former NEDA head RomuloNeri refused to answer certain questions involving his conversationswith President Arroyo on the ground they are covered by executiveprivilege. When the Senate cited him in contempt and ordered hisarrest, Neri filed a case against the Senate with the Supreme Court.On March 25, 2008, the Supreme Court ruled in favor of Neri and
upheld the claim of executive privilege.
What is “executive privilege”?
It is the right of the President and high-level executive branchofficials to withhold information from Congress, the courts and thepublic. It is a privilege of confidentiality which applies tocertain types of information of a sensitive character that would beagainst the public interest to disclose. Executive privilege isbased on the constitution because it relates to the President’seffective discharge of executive powers. Its ultimate end is topromote public interest and no other.
Is executive privilege absolute?
No. Any claim of executive privilege must be weighed against otherinterests recognized by the constitution, like the state policy of full public disclosure of all transactions involving public interest,the right of the people to information on matters of public concern,the accountability of public officers, the power of legislativeinquiry, and the judicial power to secure evidence in deciding cases.
Did the revocation by the President of E.O. 464 on March 6, 2008diminish the concept of executive privilege?
No. Executive privilege may still be invoked despite the President’srevocation of E.O. 464 because it is based on the constitution.
ON THE CONTENTS OF THE SUPREME COURT DECISION:
What events led to the filing of the case before the Supreme Court?
On April 21, 2007, the DOTC and Zhing Xing TelecommunicationsEquipment (ZTE), a corporation owned by the People’s Republic of
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China, executed a “Contract for the Supply of Equipment and Servicesfor the National Broadband Network Project” (NBN-ZTE Contract) worthUS$329,481,290.00 (around PhP 16B). The project sought to providelandline, cellular and internet services in government officesnationwide and was to be financed through a loan by China to thePhilippines. President Arroyo witnessed the contract signing inChina.
After its signing, reports of anomalies concerning the project (e.g.,bribery, “overpricing” by US$ 130M, “kickback commissions” involvingtop government officials, and loss of the contract) prompted theSenate, through the Committees on Accountability of Public Officersand Investigations (Blue Ribbon), Trade and Commerce, and NationalDefense and Security, to conduct an inquiry in aid of legislation.
The inquiry was based on a number of Senate resolutions and inconnection with pending bills concerning funding in the procurementof government projects, contracting of loans as developmentassistance, and Senate concurrence to executive agreements.
In one of the hearings held on Sept. 26, 2007, former NEDA Director
General Romulo Neri testified that President Arroyo initially gaveinstructions for the project to be undertaken on a Build-Operate-
Transfer (BOT) arrangement so the government would not spend moneyfor it, but eventually the project was awarded to ZTE with agovernment-to-government loan from China. He also said that thenCOMELEC Chairman Benjamin Abalos, the alleged broker in the project,offered him PhP 200M in exchange for NEDA’s approval of the project.Neri testified that when he told President Arroyo of the bribe offer,she told him not to accept it. But Neri refused to answer questionsabout what he and the President discussed after that, invokingexecutive privilege since they concerned his conversations with thePresident. The Senate required him to appear again and testify on
November 20, 2007. On November 15, 2007, Executive Secretary EduardoErmita wrote the Senate Committees and asked that Neri’s testimony onNovember 20, 2007 be dispensed with because he was invoking executiveprivilege “by Order of the President” specifically on the followingquestions:
a. Whether the President followed up on the NBN project?b. Were you dictated to prioritize the ZTE?c. Whether the President said to go ahead and approve theproject after being told about the alleged bribe?
When Neri failed to appear on November 20, 2007, the Senate required
him to show cause why he should not be cited in contempt. Neriexplained that he thought the only remaining questions were those heclaimed to be covered by executive privilege and that should there benew matters to be taken up, he asked that he be informed in advanceof what else he needs to clarify so he could prepare himself.
On Dec. 7, 2007, Neri questioned the validity of the Senate’s showcause order before the Supreme Court. On January 30, 2008, theSenate cited Neri in contempt and ordered his arrest for his failureto appear in the Senate hearings. On February 1, 2008, Neri asked theSupreme Court to stop the Senate from implementing its contempt
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order, which the Court granted on Feb. 5, 2008. The Supreme Courtalso required the parties to observe the status quo prevailing beforethe issuance of the contempt order.
What reasons were given for the claim of executive privilege?
Executive Secretary Ermita said that “the context in which executiveprivilege is being invoked is that the information sought to be
disclosed might impair our diplomatic as well as economic relationswith the People’s Republic of China.” Neri further added thathis “conversations with the President dealt with delicate andsensitive national security and diplomatic matters relating to theimpact of the bribery scandal involving high government officials andthe possible loss of confidence of foreign investors and lenders inthe Philippines.”
What issues were considered by the Supreme Court in resolving thecase?
The Supreme Court said there were two crucial questions at the core
of the controversy:
a. Are the communications sought to be elicited by the threequestions covered by executive privilege?b. Did the Senate Committees commit grave abuse of discretion inciting Neri in contempt and ordering his arrest?
How did the Supreme Court resolve these issues?
The Supreme Court first recognized the power of Congress to conductinquiries in aid of legislation. The Court said that the powerextends even to executive officials and the only way for them to be
exempted is through a valid claim of executive privilege.
On the first question, the Supreme Court said that the communicationssought to be elicited by the three questions are covered by thepresidential communications privilege, which is one type of executiveprivilege. Hence, the Senate cannot compel Neri to answer the threequestions.
On the second question, the Supreme Court said that the SenateCommittees committed grave abuse of discretion in citing Neri incontempt. Hence, the Senate order citing Neri in contempt andordering his arrest was not valid.
What are the types of executive privilege?
a. state secrets (regarding military, diplomatic and othersecurity matters)b. identity of government informersc. information related to pending investigationsd. presidential communicationse. deliberative process
In what cases is the claim of executive privilege highly recognized?
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The claim of executive privilege is highly recognized in cases wherethe subject of inquiry relates to a power textually committed by theconstitution to the President, such as the commander-in-chief,appointing, pardoning, and diplomatic powers of the President.Information relating to these powers may enjoy greaterconfidentiality than others.
What specifically are the executive privileges relating todeliberations or communications of the President and other government officials?
These are the presidential communications privilege and thedeliberative process privilege.
How are the presidential communications privilege and thedeliberative process privilege distinguished?
The presidential communications privilege applies to decision-makingof the President. It pertains to “communications, documents or other
materials that reflect presidential decision-making and deliberationsand that the President believes should remain confidential”.
The deliberative process privilege applies to decision-making of executive officials. It includes “advisory opinions, recommendationsand deliberations comprising part of a process by which governmentaldecisions and policies are formulated.”
Unlike the deliberative process privilege, the presidentialcommunications privilege applies to documents in their entirety, andcovers final and post-decisional materials as well as pre-deliberative ones.
Moreover, congressional or judicial negation of the presidentialcommunications privilege is always subject to greater scrutiny thandenial of the deliberative process privilege.
What is the type of executive privilege claimed in this case?
The type of executive privilege claimed in this case is thepresidential communications privilege.
Is there a presumption in favor of presidential communications?
Yes. Presidential communications are “presumptively privileged”. The presumption is based on the President’s generalized interest inconfidentiality. The privilege is necessary to guarantee the candorof presidential advisors and to provide the President and those whoassist him with freedom to explore alternatives in the process of shaping policies and making decisions and to do so in a way manywould be unwilling to express except privately.
The presumption can be overcome only by mere showing of public needby the branch seeking access to presidential communications.
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Who are covered by the presidential communications privilege?
Aside from the President, the presidential communications privilegecovers senior presidential advisors or Malacanang staff whohave “operational proximity” to direct presidential decision-making.
What are the elements of the presidential communications privilege?
The following are the elements of the presidential communicationsprivilege:
a. The protected communication must relate to a “quintessentialand non-delegable presidential power”.b. The communication must be authored or “solicited andreceived” by a close advisor of the President or the Presidenthimself. The advisor must be in “operational proximity” with thePresident.c. The privilege is a qualified privilege that may be overcomeby a showing of adequate or compelling need that would justify thelimitation of the privilege and that the information sought is
unavailable elsewhere by an appropriate investigating agency.
What are examples of “quintessential and non-delegable presidential powers” which are covered by the presidential communications privilege?
The privilege covers only those functions which form the core of presidential authority. These are functions whichinvolve “quintessential and non-delegable presidential powers” suchas the powers of the president as commander-in-chief (i.e., to callout the armed forces to suppress violence, to declare martial law, orto suspend the privilege of the writ of habeas corpus), the power to
appoint officials and remove them, the power to grant pardons andreprieves, the power to receive ambassadors, and the power tonegotiate treaties and to enter into execute agreements.
Are the elements of the presidential communications privilege present in this case?
Yes. The communications elicited by the three questions are coveredby the presidential communications privilege because:
a. First, the communications relate to the power of thePresident to enter into an executive agreement with other countries.
b. Second, the communications are received by Neri, who as aCabinet member can be considered a close advisor of the President.c. Third, the Senate Committees have not adequately shown acompelling need for the answers to the three questions in theenactment of a law and of the unavailability of the informationelsewhere by an appropriate investigating authority.
Does the grant of the claim of executive privilege violate the right of the people to information on matters of public concern?
No, for the following reasons:
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a. Neri appeared before the Senate on Sept. 26, 2007 and wasquestioned for 11 hours. He also expressed his willingness to answermore questions from the Senators, except the three questions.b. The right to information is subject to limitation, such asexecutive privilege.c. The right of Congress to obtain information in aid of legislation cannot be equated with the people’s right to
information. Congress cannot claim that every legislative inquiry isan exercise of the people’s right to information.
Was the claim of executive privilege properly invoked by thePresident in this case?
Yes. For the claim to be properly invoked, there must be a formalclaim by the President stating the “precise and certain reason” forpreserving confidentiality. The grounds relied upon by ExecutiveSecretary Ermita are specific enough, since what is required is onlythat an allegation be made “whether the information demanded involvesmilitary or diplomatic secrets, closed-door Cabinet meetings, etc.”
The particular ground must only be specified, and the followingstatement of grounds by Executive Secretary Ermita satisfies therequirement: “The context in which executive privilege is beinginvoked is that the information sought to be disclosed might impairour diplomatic as well as economic relations with the People’sRepublic of China.”
What reasons were given by the Supreme Court in holding that it waswrong for the Senate to cite Neri in contempt and order his arrest?
a. There was a legitimate claim of executive privilege.b. The Senate’s invitations to Neri did not include the possible
needed statute which prompted the inquiry, the subject of inquiry,and the questions to be asked.c. The contempt order lacked the required number of votes.d. The Senate’s rules of procedure on inquiries in aid of legislation were not duly published.e. The contempt order is arbitrary and precipitate because theSenate did not first rule on the claim of executive privilege andinstead dismissed Neri’s explanation as unsatisfactory.
IMPLICATIONS OF THE SUPREME COURT DECISION:
Who has the burden of showing whether or not a claim of executive
privilege is valid?
Executive privilege is in derogation of the search for truth.However, the decision recognized Presidential communications aspresumptively privileged. Hence, the party seeking disclosure of theinformation has the burden of overcoming the presumption in favor of the confidentiality of Presidential communications.
This presumption is inconsistent with the Court’s earlier statementin Senate vs. Ermita (April 20, 2006) that “the presumption inclinesheavily against executive secrecy and in favor of disclosure”. It
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is also inconsistent with constitutional provisions on transparencyin governance and accountability of public officers, and the right of the people to information on matters of public concern.
Does the decision expand the coverage of executive privilege?
Yes, the decision expands the coverage of executive privilege in atleast two ways:
a. The decision explained that the presidential communicationsprivilege covers communications authored or “solicited and received”by a close advisor of the President or the President himself. Thismeans that the privilege applies not only to communications thatdirectly involve the President, but also to communications involvingthe President’s close advisors, i.e., those in “operationalproximity” with the President. There is no definitionof “operational proximity”, so it is not clear how far down the chainof command the privilege extends. This expansion of the coverage of the privilege means that information in many areas of the executivebranch will become “sequestered” from public view.
b. The decision also stated that the presidential communicationsprivilege applies to documents in their entirety, and covers finaland post-decisional materials as well as pre-deliberative ones. Thismeans that the privilege protects not only the deliberative or adviceportions of documents, i.e., communications made in the process of arriving at presidential decisions, but also factual material orinformation concerning decisions already reached by the President.
How will the decision affect other investigations?
The decision makes it easy for the President to invoke executive
privilege, since what is required is only that an allegation bemade “whether the information demanded involves military ordiplomatic secrets, closed-door Cabinet meetings, etc.” This ineffect will enable the use of executive privilege to hide misconductor crime. According to Fr. Bernas, S.J., the implication of theruling is that once the “presidential communications privilege” isinvoked, no evidence is needed to support it even if there are validreasons for disclosing the information sought. “This wouldrevolutionize the doctrine in a manner that can affect all otherinvestigations. This can, for instance, hamper effective use of the… writ of amparo and writ of habeas data. It can also crippleefforts to battle official corruption ….”
In particular, what is the effect of the decision on the Senate’spower to conduct inquiries in aid of legislation?
The decision severely limits the Senate’s power of legislativeinquiry and its ability to investigate government anomalies in aid of legislation. The decision encroaches upon matters internal to theSenate as an institution separate from and co-equal to other branchesof government.
The decision, for instance, requires the Senate to give its questions
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in advance of its hearings. But this is a requirement applicableonly to the question hour and not to inquiries in aid of legislation. Moreover, it is impractical, since follow-up questionsof Senators will be difficult to anticipate.
The decision also requires the Senate to publish its rules of procedure on legislative inquiries every three years. But theSenate traditionally considered as a continuing body. Senate
committees continue to work even during senatorial elections. Bytradition and practice, the Senate does not re-publish its rules. Torequire publication of its rules every three years is unnecessary andinconsistent with its tradition and practice.
Did the Supreme Court ruling establish a doctrine on executive privilege?
No. Although the vote is 9 – 6 in favor of upholding the claim of executive privilege, two of the nine Justices concurred merely in theresult, while one Justice argued not on the basis of executiveprivilege. Hence, only six out of the nine Justices explained their
votes in favor of the claim of executive privilege. Six out of atotal of 15 Justices do not establish a doctrine.
Can the Senate continue with its investigations despite the SupremeCourt ruling?
The decision does not stop the Senate from continuing with itsinvestigations and from undertaking other inquiries, although thegovernment has already declared that officials will not appear unlessthe Senate rules are first published. Should Neri (and otherofficials) appear, the Senate can ask him questions other than thethree questions. But Neri may again invoke executive privilege on
other questions, which could result in another case before theSupreme Court, and the cycle may be repeated again and again. Such asituation, particularly where there appears to be a pattern of concealment in government activities, will ultimately be harmful topublic interest.
Prepared by: ATTY. CARLOS P. MEDINA, JR. Ateneo Human Rights Center March 30, 2008
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