Doctrine: There are three requisites necessary for a finding of default.

First, the obligation is

demandable and liquidated; second, the debtor delays performance; and third, the creditor
judicially or extra judicially requires the debtor's performance. Article 1169 of the Civil Code
states that: those obligated to deliver or to do something incur in delay from the time the
obligee judicially or extrajudicially demands from them the fulfillment of their obligation.
However, the demand by the creditor shall not be necessary in order that delay may exist,
when the obligation or the law expressly so declares.
GENERAL MILLING CORPORATION,
- versus SPS. LIBRADO RAMOS and REMEDIOS RAMOS,
FACTS:
General Milling Corporation (GMC) entered into a Growers Contract with spouses Librado and
Remedios Ramos (Spouses Ramos). Under the contract, GMC was to supply broiler chickens
for the spouses to raise on their land. To guarantee full compliance, theGrowers Contract
was accompanied by a Deed of Real Estate Mortgage over a piece of real property and a
surety bond. Spouses Ramos eventually were unable to settle their account with GMC. The
property was extrajudicially foreclosed and GMC was the highest bidder. Spouses Ramos
questioned the validity of the foreclosure proceedings. The CA found thatGMC made no
demand to spouses Ramos for the full payment of their obligation. A perusal of the letters
presented and offered as evidence by defendant-appellant GMC did not demand but only
request spouses Ramos to go to the office of GMC to discuss the settlement of their
account.
ISSUE: Was there sufficient demand?
HELD:
No. There are three requisites necessary for a finding of default. First, the obligation is
demandable and liquidated; second, the debtor delays performance; and third, the creditor
judicially or extra judicially requires the debtor's performance. GMC did not make a demand
on Spouses Ramos but merely requested them to go to GMCs office to discuss the
settlement of their account. In spite of the lack of demand made on the spouses, however,
GMC proceeded with the foreclosure proceedings. Neither was there any provision in the
Deed of Real Estate Mortgage allowing GMC to extra judicially foreclose the mortgage
without need of demand.
Article 1169 of the Civil Code states that: those obligated to deliver or to do something incur
in delay from the time the obligee judicially or extrajudicially demands from them the
fulfillment of their obligation. However, the demand by the creditor shall not be necessary in
order that delay may exist, when the obligation or the law expressly so declares. The
contract in the instant case carries no such provision on demand not being necessary for
delay to exist. GMC should have first made a demand on the spouses before proceeding to
foreclose the real estate mortgage.
Doctrine: Section 2, Rule 2 of the Rules of Court defines cause of action as an act or
omission by which one party violates a right of another. It has three elements: (1) a right
existing in favor of the plaintiff, (2) a duty on the part of the defendant to respect the right of
the plaintiff, and (3) a breach of the defendants duty. The test of sufficiency of the facts
alleged in the complaint as constituting a cause of action is whether or not admitting the
facts alleged; the court could render a valid verdict in accordance with the prayer of the
complaint.
BF CORPORATION,
- versus MANILA INTERNATIONAL AIRPORT AUTHORITY,

FACTS:
Mitsubishi Corporation (Mitsubishi), Tokyu Construction Co., Ltd. (Tokyu), A.M. Oreta & Co.,
Inc. (Oreta), and BF formed themselves into the MTOB Consortium (Consortium) to
participate in the bidding for the construction of the Ninoy Aquino International Airport
Terminal II (NAIA II) Project. MIAA awarded the contract to the Consortium, recognizing that
the Consortium was a distinct and separate entity from the four member corporations.
Unfortunately, the four members had serious business differences BF then filed with the
Regional Trial Court an action for Specific Performance, Rescission, and Damages with
application for a TRO. BF alleged that after the members of the Consortium reached an
agreement, Tokyu refused to execute a final consortium agreement; unreasonably
demanded that BF reduce its asking prices for its assigned work; engaged the services of
other subcontractors to do BFs portion of the project; and refused to remit to BF its 20%
share of the down payment, thereby easing out BF in the project in breach of the Consortium
agreement. BF prayed that Tokyu be enjoined from further (1) receiving any payment from
MIAA for illegally executing BFs portion of the work in the project; (2) engaging the services
of other subcontractors to do BFs portion of the project; (3) acting as lead partner of the
Consortium; and (4) compelling BF to reduce its prices. BF also prayed that MIAA be enjoined
from directly paying Tokyu the collectible compensation vis--vis Tokyus illegal execution of
BFs portion in the project. MIAA stressed its position that it should not be dragged into the
dispute since it was a consortium internal matter. Thereafter, in an amended complaint, BF
dropped MIAA as a party-defendant.
When the project was nearing completion, BF filed a second amended complaint. In
it, BF pleaded causes of action against Tokyu, Mitsubushi, and Oreta which have all
submitted themselves to the jurisdiction of the court, and also MIAA who had possession of
money to be paid to Tokyu. BF claimed it was entitled to a proportionate share of the money
based on the Consortium agreement. Thus, BF asked that MIAA be re-impleaded as a partydefendant so it could obtain complete relief. RTC directed that MIAA be re-impleaded as a
party-defendant. On appeal, CA said that the RTC committed grave abuse of discretion
amounting to lack or excess of jurisdiction when it issued the orders. According to the CA,
MIAAs refusal to be a part of the internal squabble among members of the Consortium was
not an act or omission that gave BF a cause of action. The CA also pointed out that BF was
estopped from treating MIAA as a necessary party, because when it dropped MIAA as a party
in its amended complaint without stating why it did, BF implicitly admitted that MIAA was
not a necessary party.
ISSUES:
1. Whether or not BF has cause of action against MIAA as in fact, BFs second amended
complaint states a cause of action againt MIAA;
2. Whether or not BF is estopped from impleading MIAA in the case;
3. Whether or not BF is barred under the doctrine of res judicata from impleading
MIAA in the main case.
Held:
1. No. On the bases of these allegations, we can hardly rule that BF has a cause of
action against MIAA. Section 2, Rule 2 of the Rules of Court defines cause of action as
an act or omission by which one party violates a right of another. It has three
elements: (1) a right existing in favor of the plaintiff, (2) a duty on the part of the
defendant to respect the right of the plaintiff, and (3) a breach of the defendants

duty. A close reading of the second amended complaint discloses that the rights of BF
that have allegedly been violated are those contained in the Consortium agreement.
A scrutiny of the agreement, however, would readily show that there is nothing in it
that would constitute acts or omissions of MIAA that violate BFs rights. Even if BF
wrote MIAA and called the latters attention to the contract violations of Tokyu and
asked MIAA to persuade Tokyu to remit to BF its 20% share in the down payment;
enjoin Tokyu from illegally hiring subcontractors to do BFs part of the project; and
expel Tokyu from the Consortium, these facts are insufficient to constitute the bases
of BFs cause of action against MIAA. The test of sufficiency of the facts alleged in the
complaint as constituting a cause of action is whether or not admitting the facts
alleged; the court could render a valid verdict in accordance with the prayer of the
complaint. Even if we assume that the facts alleged were true, we still cannot grant
any of BFs prayers against MIAA as we would have no basis to do so in fact and in
law.The best evidence to show whether or not BF has a cause of action against MIAA
is the contract/agreement itself. BF was not a party to the Agreement. From the very
start, MIAA had categorically said it recognized the Consortium as a distinct and
separate entity.
2. Yes. Under the doctrine of estoppel, an admission or representation is conclusive on
the person making it and cannot be denied or disproved as against the person relying
on it. A person, who by deed or conduct has induced another to act in a particular
manner, is barred from adopting an inconsistent position, attitude, or course of
conduct that thereby causes loss or injury to another. BF is now estopped from reimpleading MIAA. When BF dropped MIAA as defendant in its first amended
complaint, it had performed an affirmative act upon which MIAA based its subsequent
actions, e.g. payments to Tokyu, on the faith that there was no cause of action
against it, and so on. BF cannot now deny that it led MIAA to believe BF had no cause
of action against it only to make a complete turn-about and renege on the effects of
dropping MIAA as a party-defendant months after, to the prejudice of MIAA. MIAA had
all reasons to rely on the CAs decision that it was no longer a party to the suit.
3. For res judicata to exist, the following elements must be present: (1) the judgment
must be final; (2) the court that rendered judgment must have jurisdiction over the
parties and the subject matter; (3) it must be a judgment on the merits; and (4) there
must be between the first and second actions identity of parties, subject matter, and
cause of action. There is no dispute on the presence of the first three elements
enumerated above. However, the same cannot be said regarding the last element. As
BF has correctly pointed out, CA-G.R. SP No. 43133 was filed by Tokyu against the
trial judge and BF, while CA-G.R. SP No. 67765 was filed by MIAA in which Tokyu is not
even a party. It is also apparent that the subject matter in CA-G.R. SP No. 43133 was
the propriety of the TRO granted by the RTC, and the subject matter in CA-G.R. SP No.
67765 is the propriety of including MIAA as a party-defendant in Civil Case No. 66060.
While it may be true that both cases touched on MIAA as a party-defendant, we are
unable to say that the subject matters of CA-G.R. SP No. 43133 and CA-G.R. SP No.
67765 are identical. As to the cause of action, CA-G.R. SP No. 43133 is the off-shoot
of the alleged abuse of discretion of the trial judge in issuing the TRO, while CA-G.R.
SP No. 67765 is the result of the alleged grave abuse of discretion of the trial court
judge in allowing MIAA to be re-impleaded as a party-defendant. Lacking the identity
of parties, subject matter, and cause of action, the doctrine of res judicata is
inapplicable. This, however, should not detract from the fact that the CA was correct
in granting the petition.
Doctrine: It is true that the notice alone will not preclude the transfer of the
property pendente lite, for the title to be issued to the transferee will merely carry the
annotation that the lot is under litigation. Hence, the notice of lis pendens, by itself, may not
be the most convenient and feasible means of preserving or administering the property in

litigation. However, the situation is different in the case at bar. A counterbond will also be
posted by the respondent to answer for all damages petitioners may suffer by reason of any
transfer of the disputed properties in the future.
MILA G. IGNALING,
- versus
ENGR. JOSE J. REYES,
FACTS:
Severino Reyes was the father of respondent Jose Reyes and Torcuato Reyes. Upon the death
of Severino, respondent and Torcuato came upon their inheritance consisting of several
properties. They had an oral partition of the properties and separately appropriated to
themselves said properties. On May 12, 1992, Torcuato died with a last will and testament
executed on January 3, 1992. Petitioner Vivares was the designated executor of Torcuatos
last will and testament, while petitioner Ignaling was declared a lawful heir of Torcuato.
Believing that Torcuato did not receive his full share in the estate of Severino, petitioners
instituted an action for Partition and Recovery of Real Estate. With the approval of the trial
court, the parties agreed that properties from the estate of Severino, which were already
transferred in the names of respondent and Torcuato prior to the latters death on May 12,
1992, shall be excluded from litigation. In short, what was being contested were the
properties that were still in the name of Severino. On March 15, 2000, petitioners filed a
Motion to Place Properties in Litigation under Receivership before the trial court alleging that
to their prejudice respondent had, without prior court approval and without petitioners
knowledge, sold to third parties and transferred in his own name several common
properties. Petitioners also averred that respondent fraudulently antedated, prior to May 12,
1992, some conveyances and transfers to make it appear that these were no longer part of
the estate of Severino under litigation.
On March 23, 2000, respondent filed his Opposition to Place the Estate of Severino Reyes
under Receivership, denying that he had fraudulently transferred any property of the estate
of Severino and asserting that any transfer in his name of said properties was a result of the
oral partition between him and Torcuato that enabled the latter as well to transfer several
common properties in his own name. On September 19, 2000, respondent filed a
Manifestation with Motion to Discharge Receiver. Subsequently, respondent filed a Motion to
Cancel Notice of Lis Pendens which was annotated on Tax Declaration (TD) No. 112 covering
Lot No. 33 allegedly belonging exclusively to him.
Issue:
Whether or not the annotation of a notice of Lis Pendens precludes the appointment
of a receiver when there is a need to safeguard the properties in litigation.
Held:
Yes. It is true that the notice alone will not preclude the transfer of the property pendente
lite, for the title to be issued to the transferee will merely carry the annotation that the lot is
under litigation. Hence, the notice of lis pendens, by itself, may not be the most convenient
and feasible means of preserving or administering the property in litigation. However, the
situation is different in the case at bar. A counterbond will also be posted by the respondent
to answer for all damages petitioners may suffer by reason of any transfer of the disputed
properties in the future. As a matter of fact, petitioners can also ask for the issuance of an
injunctive writ to foreclose any transfer, mortgage, or encumbrance on the disputed
properties. These considerations, plus the finding that the appointment of the receiver was
without sufficient cause, have demonstrated the vulnerability of petitioners postulation.
Further, Since a notice of lis pendens has been annotated on the titles of the disputed
properties, the rights of petitioners are amply safeguarded and preserved since there can be

no risk of losing the property or any part of it as a result of any conveyance of the land or
any encumbrance that may be made thereon posterior to the filing of the notice of lis
pendens. Once the annotation is made, any subsequent conveyance of the lot by the
respondent would be subject to the outcome of the litigation since the fact that the
properties are under custodia legis is made known to all and sundry by operation of
law. Hence, there is no need for a receiver to look after the disputed properties.
Doctrine: The essential elements of litis pendentia are as follows: (1) identity of parties or
representation in both cases; (2) identity of rights asserted and reliefs prayed for; (3) reliefs
founded on the same facts and the same basis; and (4) identity of the two preceding
particulars should be such that any judgment, which may be rendered in the other action,
will, regardless of which party is successful, amount to res judicata in the action under
consideration.
FORBES PARK ASSOCIATION, G.R. No. 153821
INC.,
- versus
PAGREL, INC., PILAR R. DE LAGDAMEO, ENRIQUE B. LAGDAMEO, ATTY. MILA B.
FLORES in her capacity as the Register of Deeds of Makati City,
Facts:
(Lis Pendens Case)
On January 27, 1999, FPA filed an application with the Register of Deeds of Makati
City for the registration by FPA of notices of lis pendens over certain Forbes Park lots
in connection with HIGC Case Nos. HOA-97-003, HOA-97-010, and HOA-98-111. The
issue in the above HIGC cases was the extension of the Deed of Restrictions. The
Register of Deeds denied FPAs application. This denial compelled FPA to appeal via
a consulta with the Land Registration Authority (LRA). The principal issue FPA raised
before the LRA was whether or not a notice of lis pendens can be registered given the
circumstances of FPAs application. LRA issued a resolution denying the appeal filed
by FPA. The denial prompted FPA to file a petition for review with the CA. Attached to
the petition was a verification and certification against non-forum shopping signed by
one Reynaldo N. Rigor, Village Manager of Forbes Park. On November 28, 2000, the
CA, in a single page resolution, dismissed FPAs petition for review on the sole ground
that the person who signed the subject verification and certification was not a duly
authorized representative of FPA.FPAs motion for reconsideration was denied in the
CAs June 25, 2001 Resolution. Thereafter, FPA filed before the Court a petition for
review, assailing the above resolutions of the CA and praying that the CA be directed
to give due course to FPAs petition for review on the issue of registration of the
notices of lis pendens on certain Forbes Park lots.
Subsequently, FPA filed a Manifestation and Motion to Withdraw the Petition dated March 15,
2005, contending that the lis pendens issue in question has been rendered moot by the
development in Arturo V. Rocha v. FPA, G.R. No. 163869.
Acting on FPAs manifestation and motion to withdraw the petition, this Court issued a
Resolution dated April 25, 2005, stating that G.R. No. 148733 dismissing the petition was
deemed closed and terminated. The entry of judgment in G.R. No. 148733 was made on June
14, 2005.
The PAGREL Cases
Earlier, on March 29, 2001, respondent PAGREL, Inc., represented by Gregorio Araneta III,
respondent Pilar R. De Lagdameo, and respondent Lagdameo, separately filed ex
parte petitions with the Makati City Regional Trial Court[8] (RTC) to cancel the restrictions over
their respective lot titles. These were docketed as LRC Case Nos. M-4150, M-4151, and M4152, respectively (PAGREL cases). They claimed that the Deed of Restrictions had expired

and remained so until the time of the filing of their petitions without any extensions or new
restrictions registered with the Registry of Deeds of Makati City as of midnight of December
31, 1998. Significantly, FPA was not impleaded as a party in any of the above cases filed with
the RTC.
The Ruling of the Court of Appeals in
(PAGREL Cases)
In its March 7, 2002 Resolution,[11] the CA denied FPAs petition for annulment of the final
order of the RTC. The CA found that between the PAGREL cases and Lis Pendens, the
elements of litis pendentia existed.
Issue:
Whether or not the petitioner is guilty of Lis Pendentia or Non- forum shopping
Held:
No. In numerous cases, this Court has defined what constitutes litis pendentia. The essential
elements of litis pendentia are as follows: (1) identity of parties or representation in both
cases; (2) identity of rights asserted and reliefs prayed for; (3) reliefs founded on the same
facts and the same basis; and (4) identity of the two preceding particulars should be such
that any judgment, which may be rendered in the other action, will, regardless of which party
is successful, amount to res judicata in the action under consideration.
The elements of litis pendentia are not present in the cases at bar. For one, there is no
identity of parties. In both the lis pendens case and PAGREL cases, the petitioner is
FPA. However with respect to respondents, in lis pendens the respondent is the Makati City
Register of Deeds with the CA as public respondent. In PAGREL cases, the respondents are
PAGREL, Inc., De Lagdameo, and Lagdameo with Judge Santamaria as public
respondent. Hence, the parties are not the same. There is also no identity of causes of
action. Lis pendens case, the cause of action is the legality of annotating the notice of lis
pendens pertaining to three (3) HIGC cases, namely: HIGC Case Nos. HOA-97-003, HOA-97010, and HOA-98-111 on the certificates of title. In PAGREL cases, however, the cause of
action of FPA relates to the annulment of the order of the Makati City RTC, canceling the
annotation of the Deed of Restrictions at the back of the titles of PAGREL, Inc., De
Lagdameo, and Lagdameo due to extrinsic fraud by reason of the non-joinder of FPA as an
adverse partry. The difference between the causes of action between the two sets of cases is
obvious. One seeks for the annotation of notices of lis pendens relating to several pending
cases, while the other is for re-annotations of the liens on the titles of lot owners which were
canceled. Indeed, there is a material and substantial difference between the causes of action
in the two cases. Lastly, there is no identity of reliefs prayed for.