1
ALFONSO D. GAVIOLA, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
DE CISIO N
CALLEJO, SR., J.:
Before the Court is a petition for review of the Decision1 of the Court of Appeals (CA) in CA-G.R. CR No.
24413 affirming the ruling2 of the Regional Trial Court (RTC) of Nava, Biliran, Branch 16, in Criminal Case
No. N-1901, where petitioner Alfonso Gaviola was convicted of qualified theft.
The antecedents are as follows:
On May 25, 1954,Elias Gaviola filed a complaint against Eusebio Mejaritoin the then Court of FirstInstance
of Carigara, Leyte, for quieting of title with a plea for injunctive relief. The suit involved a 40,500-square-
meter parcel of coconut land located in Barrio Calbani, Maripipi, Leyte, identified as Cadastral Lot 1301
and covered by Tax Declaration (TD) No. 743. 3 The case was docketed as Civil Case No. 111. Eusebio,for
his part, claimed ownership over the property.
On July 29, 1955, the trial court ordered the dismissal of the complaint and declared Eusebio the lawful
owner of the property. The dispositive portion of the decision reads:
WHEREFORE, for the foregoing, the Court renders judgment dismissing the plaintiffs’ complaint and
declaring the defendants the absolute owners and entitled to the possession of the disputed land. The
preliminary injunction which was granted by this Court through Judge Lorenzo Carlitos is ordered
dissolved, with costs against the plaintiffs.
SO ORDERED.4
The decision became final and executory. On September 3, 1955,the trial court ordered the sheriff to place
Eusebio in possession of the property. 5 The sheriff complied with the order on December 19, 1958. 6
In the meantime, Eusebio died intestate and was survived by his son, Cleto. Elias Gaviola also died intestate
and was survived by his son, Alfonso.
Almost 30 years thereafter, on October 1985, Cleto filed a complaint against Alfonso and four others for
recovery of possession of a parcel of land and execution of judgment in Civil Case No. 111. The property
involved was located on the north of Lot 1301 and covered by TD No. 1546. The case was docketed as Civil
Case No. B-0600.
The plaintiff therein alleged that the houses of the defendants were located in the property that had been
adjudicated to his father, Eusebio Mejarito, in Civil Case No. 111. He prayed that the court issue judgment
as follows:
a) Ordering [the] immediate execution of judgment in Civil Case No. 111, against defendants Segundo
Gaviola and Alfonso Gaviola;
b) Ordering all defendants evicted from any portion of the land they presently occupy as residential;
c) Ordering all defendants to pay rent in favor of the plaintiff with legal interests imposed reckoned from
June 1984 until full payment of what is due and/or until their complete and absolute eviction from their
respective residences which rent liabilities when computed annually for each of them is in the sum of
PESOS: THREE THOUSAND SIX HUNDRED (P3,600.00), Philippine Currency;
d) Ordering defendants to pay plaintiff jointly and severally the sum of PESOS: THIRTY THOUSAND
(P30,000.00), Philippine Currency, representing moral damages;
e) Ordering defendants to pay plaintiff jointly and severally the sum of PESOS: TWENTY-FIVE THOUSAND
(P25,000.00), Philippine Currency, representing attorney’s fee and litigation expenses.
Plaintiff prays for such relief and other remedies as may be just and equitable in the premises. 7
In their answer to the complaint, the defendants averred that the property in which their houses were
located is different from that which was adjudicated by the court in Civil Case No. 111 to Eusebio Mejarito.
The parties could not agree on the identification and metes and bounds of the parcel of land claimed and
owned by the plaintiff and those claimed and owned by the defendants. This impelled the court to appoint
Bienvenido Ricafort, the Officer-in-Charge of the sub-office of the Provincial Assessor, as Commissioner,
to resurvey the property subject of the complaint. A sketch of the property was prepared, indicating the
location of the plaintiff’s lot (Lot 1301) and the parcel of land where the house of Gaviola stood (Lot 1311).
The Commissioner also prepared a report8 stating that the property adjudicated to Eusebio Mejarito in
Civil Case No. 111 was Cadastral Lot No. 1301, while that which belonged to Elias Gaviola was Cadastral
Lot No. 1311; and the old one-storey house of defendant Alfonso Gaviola was located in the latter lot.The
defendant did not object to the report. 9
On May 4, 1990, the court rendered judgment in favor of the defendants in Civil Case No. B-0600 and
ordered the complaint dismissed. The court ruled that the parcels of land occupied by the defendants,
inclusive of Lot 1311, were different from the property adjudicated to Eusebio Mejarito in Civil Case No.
111, which is actually Lot 1301. The court also ruled that the plaintiff had no cause of action for the
execution of the court’s decision in Civil Case No. 111 because such decision had long been enforced,per
report of the sheriff. 10
Eusebio appealed the decision to the CA which rendered judgment on September 18, 1992, affirming the
decision of the RTC. 11 The appellate court declared that the house of Alfonso Gaviola was located in Lot
1311 covered by TD 1611 under the name of Elias Gaviola. Cleto filed a petition for revie w on certiorari
with this Court, whichwas denied due course in a Resolution 12 datedMarch24, 1993. Thus, the CA decision
became final and executory. The trial court issued a writ of execution, a copy of which Sheriff LudeniloS.
Ador served on the defendants on August 5, 1993. 13
In the meantime, Cleto Mejarito left the Philippines and stayed in the United States of America. He
entrusted the land to the care of his nephew, Rafael Lozano.
At 7:00 a.m. on September 6, 1997, Jovencio Mejarito, a nephew of Cleto Mejarito, and a barangay
councilman, saw Gavino Gaviola, Rodrigo Gaviola and Domingo Caingcoy climbing the coconut trees in Lot
1301. Under the supervision of the spouses Alfonso and Leticia Gaviola, they
gathered 1,500 coconuts worth P3,000.00 from the coconut trees. 14 The Officer-in-Charge of the Maripipi
Police Station then filed a criminal complaint for qualified theft against the spouses Gaviola and those who
gathered the coconuts in the municipal trial court. 15 In the meantime, the coconuts were entrustedto the
care of the barangay captain.

On February 6, 1998, an Information was filed with the RTC of Naval, Biliran, against the spouses Alfonso
and Leticia Gaviola for qualified theft. The accusatory portion of the decision reads:
That on or about the 6th day of September 1997, at around 9 o’clock in the morning at Brgy. Calbani,
Municipality of Maripipi, Province of Biliran, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, conspiring and confederating with one another, and with intent to gain,
did then and there unlawfully, feloniously, deliberately took, harvested and gathered one t housand five
hundred (1,500) coconut fruits from the plantation of Cleto Mejarito without the consent and authority of
the latter, to the damage and prejudice of the owner amounting to P3,000.00.
Contrary to Law. 16
Alfonso admitted that the coconuts were taken upon his instructions, but insisted that the trees from
which they were taken were planted on Lot 1311, the property he had inherited from his father, Elias
Gaviola; the property of private complainant Cleto Mejarito, Lot 1301, was adjacent to his lot. Alfonso
testified that the property was placed in his possession by the sheriff since August 5, 1993, and thatsince
then he had been gathering coconuts every three months without being confronted or prosecuted by
anybody. 17 He insisted that his claim was based on the decision of the RTC in Civil Case No. B-0600,which
was affirmed by the CA. 18
On April 13, 2000, the RTC rendered judgment convicting Alfonso of qualified theft. The fallo of the
decision reads:
WHEREFORE, this Court finds the accused Alfonso Gaviola y Dimakiling guilty beyond reasonable doubtof
the crime of qualified theft; hereby imposing upon him the indeterminate penalty of imprisonment from
Five (5) Years, Five (5) Months andTen (10) days of prisioncorreccional, maximumperiod, as the minimum,
to Eight (8) Years and One (1) day of prision mayor, minimum, as the maximum.
The accused shall pay the private complainant Cleto Mejarito, through his duly authorized representative,
exemplary damages in the amount of P20,000.00 and liquidated damages in the amount of P3,000.00.
SO ORDERED.19
The trial court ruled that the accused took the coconuts from the coconut trees planted on Cadastral Lot
1301 which was owned by Cleto Mejarito, and not on his own property, Lot 1311, as he claimed.
Alfonso Gaviola appealed the decision to the CA which rendered judgment, on October 1, 2003, affirming
the decision of the RTC. He then filed a motion for reconsideration of the decision, which the appellate
court denied.
Alfonso, now the petitioner, raises the following issues in the instant petition: (1) whether the prosecution
proved beyond reasonable doubt that he had intent to gain when the coconuts were taken upon his
instruction; and (2) whether he is liable for exemplary and liquidated damages.
On the first issue, petitioner avers that the prosecution failed to prove animus lucrandi (intent to gain) on
his part. He asserts that he had been taking coconuts from the property in broad daylight three times a
year since August 5, 1993 on his honest belief that he was the owner of the land where the coconuttrees
were planted. He points out that it was only after he took coconuts on Septem ber 6, 1997 that he was
charged of qualified theft.
2
Moreover, his honest belief that he owned the land negates intent to steal, an essential element of the
felony of theft. He argues that the RTC in Civil Case No. B-0600 declared him to be the owner of the
property where the coconut trees were planted; the property was placed in his possession by the sheriff
and, since then, he had planted bananas and gathered coconuts from the coconut trees.
In its comment on the petition, the Office of the Solicitor General avers that the decision of the RTC, which
was affirmed by the CA, is in accord with the evidence on record. The OSG maintains that under the
decision of the then CFI in Civil Case No. 111, the RTC in Civil Case No. B-0600 and that of the CA affirming
on appeal the RTC ruling, the owner of Lot 1301, the property from which the coconuts were taken, was
Eusebio Mejarito, the private complainant’s father.
We rule against the petitioner.
Article 308 of the Revised Penal Code defines theft as follows:
Art. 308. Who are liable for theft.– Theft is committed by any person who, with intent to gain but without
violence, against or intimidation of persons nor force upon things, shall take personal property of another
without the latter’s consent.
Theft is likewise committed by:
1. Any person who, having found lost property, shall fail to deliver the same to the local authorities or to
its owner;
2. Any person who, after having maliciously damaged the property of another, shall remove or make use
of the fruits or objects of the damage caused by him; and
3. Any person who shall enter an enclosed estate or a field where trespass is forbidden or which belongs
to another and without the consent of its owner, shall hunt or fish upon the same or shall gather fruits,
cereals, or other forest or farm products. 20
Thus, the elements of theft are: (1) thatthere be taking of personal property; (2) that said property belongs
to another; (3) that the taking be done with intent to gain; (4) that the taking be done without the consent
of the owner; and (5) that the taking be accomplished without the use of violence against or intimidation
of persons or force upon things. 21
The provision was taken from Article 530 of the Spanish Penal Code which reads:
1. Los que con ánimo de lucrarse, y sin violencia o intimidación en las personas ni fuerza en las cosas,
toman las cosas muebles ajenas sin la voluntad, de su dueño.
2. Los que encontrándose una cosa perdida y sabiendo quién es su dueño se la apropiaren con intencion
de lucro.
3. Los dañadores que sustrajeren o utilizaren los frutos u objeto del daño causado, salvo los casos previstos
en los artículos 606, num. 1., 2. y 3; 608, num. 1; 610, num. 1.; 611;613; segundo párrafo del 617 y 618.
(Art. 437 del Cod. Penal de 1850. – Art. 379, Cdo. Franc. – Art. 331, Codigo Brasil. – Art. 151, Cod. Austr. –
Arts. 461 y 508, Cod. Belg. – Art. 242, Cod. Alem. – Arts. 422 y 423, Cod. Port. – Art. 402, Cod. Ital.)22
According to Article 310 of the Revised Penal Code, theft is qualified if coconuts are taken from the
premises of a plantation:

Art. 310. Qualified theft. – The crime of theft shall be punished by the penalties next higher by two degrees
than those respectively specified in the next preceding article, if committed by a domestic servant, or with
grave abuse of confidence, or if the property stolen is motor vehicle, mail matter or large cattle or consists
of coconuts taken from the premises of a plantation, fish taken from a fishpond or fishery or if property is
taken on the occasion of fire, earthquake, typhoon, volcanic eruption, or any other calamity, vehicular
accident or civil disturbance.
For one to be guilty of theft, the accused must have an intent to steal (animus furandi) personal property,
meaning the intent to deprive another of his ownership/lawful possession of personal property which
intent is apart from, but concurrent with the general criminal intent which is an essential element of a
felony of dolo (dolos malus). The animo being a state of the mind may be proved by direct or circumstantial
evidence, inclusive of the manner and conduct of the accused before, during and after the taking of the
personal property. General criminal intent is presumed or inferred from the very fact that the wrongful
act is done since one is presumed to have willed the natural consequences of his own acts. Likewise,
animus furandi is presumed from the taking of personal property without the consent of the owner or
lawful possessor thereof. The same may be rebutted by the accused by evidence that he took the personal
property under a bona fide belief that he owns the property. 23
In Black v. State, 24 the State Supreme Court of Alabama ruled that the open and notorious taking, without
any attempt at concealment or denial, but an avowal of the taking, raises a strong presumption that there
is no animus furandi. But, if the claim is dishonest, a mere pretense, taking the property of another will
not protect the taker:
xxx "In all cases where one in good faith takes another’s property under claim of title in himself, he is
exempt from the charge of larceny, however puerile or mistaken the claim may in fact be. And the same
is true where the taking is on behalf of another,believed to be the true owner. Still, if the claim is dishonest,
a mere pretense, it will not protect the taker."
The gist of the offense is the intent to deprive another of his property in a chattel, either for gain or outof
wantonness or malice to deprive another of his right in the thing taken. This cannot be where the taker
honestly believes the property is his own or that of another, and that he has a right to take possessionof
it for himself or for another, for the protection of the latter. 25
In Charles v. State, 26 the State Supreme Court of Florida ruled that the belief of the accused of his
ownership over the property must be honest and in good faith and not a mere sham or pretense.
In the present case, the trial court found the petitioner’s claim of having acted in the honest belief thathe
owned Lot 1301 when he ordered the harvesting of the coconuts barren of probative weight. The trial
court ruled that the petitioner even admitted in Civil Case No. B-0600 that the private complainant’s
property was separate from his:
The accused have put up a defense of ownership although from the records of Civil Case No. B -0600,
Alfonso Gaviola, et al., thru their counsel admitted that from the evidence of Cleto Mejarito especially Exh.
"E," Writ of Execution, it appears that the decision was already executed on December 22, 1958.
Further admitted that:
"The southern boundary of the land of Elias Gaviola (Alfonso) is stated as Melecio Gaviola. Actually the
land of Melecio Gaviola is now owned by plaintiff (Cleto Mejarito), the land having been adjudicated to his
3
predecessor-in-interest Eusebio Mejarito by virtue of Civil Case No. 111 (Exh. "A") (See also Exh. "6," Tax
Declaration No. 3437, reverse s ide).
Alfonso Gaviola could not have made a mistake to extricate themselves from the ejectment, Cleto Mejarito
wanted to pursue in Civil Case No. B-0600.
They submitted a well entrenched analyses as they concluded further; to quote:
"Finally, that these three parcels of lands are separate and distinct from each other is confirmed by the
cadastral survey were the lands of plaintiff (Cleto Mejarito), of Elias Gaviola (Alfonso) and of Segunda
Gaviola, are denominated as Cadastral Lot Nos. 1301, 1311 and 1303, respectively. Not only that, their
definite locations and boundaries are even delineated in the sketch prepared by the court -appointed
commissioner, which sketch is now marked as Exhibits "H" and series" (Memorandum of defendants
Gaviolas dated April 13, 1989, in Civil Case No. B-0600).
The general rule is that a judicial admission is conclusive upon the party making it and does not require
proof; exceptwhenit is shownthat the admission was made throughpalpable mistake and(2) when shown
that no such admission was in fact made. (Atillo III vs. C.A. 266 SCRA 596). 27
The findings of the RTC were affirmed by the appellate court. The well-entrenched rule is that the findings
of facts of the trial court, affirmed by the appellate court, are conclusive on this Court, absent any evidence
that the trial court and the appellate court ignored, misconstrued, or misinterpreted cogent facts and
circumstances of substance which, if considered, would warrant a modification or reversal of the outcome
of the case. We have reviewed the records and find no justification to modify, much less reverse, the
findings of the trial and appellate courts.
The petitioner cannot feign ignorance or even unfamiliarity with the location, identity and the metes and
bounds of the private complainant’s property, Lot 1301, vis-à-vis that of his own, Lot 1311. Indeed, in his
Memorandum in Civil Case No. B-0600, petitioner as one of the defendants below, categorically stated:
From the above enumeration or statement of boundaries, it is clear that these three parcels of land are
distinct and separate from each other, as the following observations can be made:
1. land of plaintiff and Elias (Alfonso) Gaviola:
a. Both have the same northern boundary: Isabela Mejarito. But the same can be explained by the fact
that sometime in 1934 Isabela Mejarito, through Pastor Armoela, sold the land now owned by Elias
(Alfonso) Gaviola to him. See Ex. "15." In fact, the first time that the land bought by Elias Gaviola was
declared in his name was in 1935 in Tax Dec. No. 2839 (Exh. "14") which cancelled in part Tax Dec. No.
1942 (Exh. "16") in the name of Isabela Mejarito.
What caused the confusion (identical northern boundary of the lands of plaintiff and Elias Gaviola) was
that the northern boundary (Isabela Mejarito) of the land of plaintiff was not adjusted accordinglydespite
the sale. It should have been changed to Elias Gaviola to reflect the sale.
b. The southern boundary of the land of Elias Gaviola (Alfonso) is stated as Melecio Gaviola. Actuallythe
land of Melecio Gaviola is now owned by plaintiff the land having been adjudicated to his predecessor-in-
interest Eusebio Mejarito by virtue of Civil Case No. 111 (Exhibit "A") (See also Exh. "6," Tax Dec. No. 3437,
reverse side)
2. land of plaintiff and Hermenegildo (Segundo) Gaviola:
 4

a. The eastern boundary of the land of plaintiff is stated as "Hermenegildo Gaviola," father and
predecessor-in-interest of defendant Segundo Gaviola;
b. The western boundary of the land of Hermenegildo Gaviola (Exh. "31-A") was previously declared as
Melecio Gaviola. But after the case (Civil Case No. 111, Exh. "A"), it was changed to "Eusebio Mejarito,"
predecessor-in-interest of plaintiff by virtue of said case. (Exh. "31-A" and "30-A."
contrary, and when it was clearly proven that he had not even planted it. The paddy had been planted by
Domingo Corpus upon land which a court of competent jurisdiction decided belonged to him and had been
harvested by him and piled upon the land at the time the defendant entered the land and took and carried
it away. The defendant neither planted the paddy nor reaped it. The court decided, before he took and
carried away the paddy, that the land belonged to Domingo Corpus. The defendant must have known that
the paddy did not belong to him. In view of the litigation, he must have known to whom it did belong. 30

So it is now clear that the land of plaintiff is west of the land of Hermenegildo Gaviola (now Segundo In fine, we find and so hold that the petitioner’s claim of good faith in taking the coconuts from the private
Gaviola), and that they are two distinct and separate lands. complainant’s land is a mere pretense to escape criminal liability.

Indeed, that the lands of plaintiff, of Elias Gaviola (father of defendant Alfonso), and of defendant Segundo We rule that there is factual and legal bases for the award of P20,000.00 by way of exemplary damages.
Gaviola (now, but Hermenegildo Gaviola before) are separate and distinct from each other is shown by the Under Article 223031 of the New Civil Code, exemplary damages may be awarded when the crime was
fact that they have been covered by different sets of tax declarations since as early as 1906. It should be committed with one or more aggravating circumstances. In this case, the petitioner is guilty not only of
noted that the tax declarations that cover each land do not merge with, overlap, or cancel, each other. simple theft but of qualified theft.
There appear apparent minor discrepancies but they can easily be explained by two events: the sale of a
portion of the land of Isabela Mejarito to Elias Gaviola and the decision in Civil Case No. 111. If these two IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit. Costs against the petitione r.
events are considered, these apparent discrepancies vanish into thin air.
SO ORDERED.
Finally, that these three parcels of lands are separate and distinct from each other is confirmed by the
cadastral survey where the lands of plaintiff, of Elias Gaviola and of Segundo Gaviola, are denominated as
Cadastral LotNos.1301, 1311 and1303,respectively. Not onlythat, theirdefinite locations and boundaries
are even delineated in the sketch prepared by the court-appointed commissioner, which sketch is now
marked as Exhs. "H" and series, of plaintiff. Also, the report to which the sketch is attached even states
that the house of defendant Alfonso Gaviola is located on the land of Elias Gaviola; and while said report
enumerates the houses located on the land of plaintiff, neither the house of defendant Alfonso Gaviola
nor of defendant Segundo Gaviola nor of the other defendants are among those mentioned therein. 28

Moreover, petitioner’s land is residential, while that of the private complainant is coconut land. There are
no coconut trees in the lot owned by petitioner, nor is there evidence that he planted coconut trees on
private complainant’s property at any time, believing that it was his own land. Petitioner could thus not
have mistaken the property of the private complainant for that of his own.

We further note thatpetitionerfailedto adduce evidence to corroborate his claimthat, prior to September
6, 1997, he had gathered coconuts from the coconut trees on the private complainant’s property three
times a year, and that the latter or his caretaker was aware thereof but failed to remonstrat e.

In United States v. Villacorta,29 the Court debunked the claim of the appellant therein that he should not
be held criminally liable for theft (larceny) for honestly believing that he owned the land from which he
took the paddy.That case is on all fours withthe present case,in thatthere was alsoa courtruling declaring
the private complainant therein as the owner of the land on which the paddy grew. The C ourt therein
ratiocinated as follows:

The attorney for the appellant in this court attempts to show that the defendant could not be guilty of
larceny, even though it be admitted that he took and carried away the paddy in question, for the reason
that he claimed to be the owner of the land. That question had been decided against him by a court of
competent jurisdiction and he made no objection to said decision. After that decision he could no longer
claim that he was the owner of the land from which he took and carried away the paddy, and moreover,
it was shown during the trial of the cause that Domingo Corpus, by his laborers, had actually plantedthe
paddy upon the land in question. It is difficult to understand upon what theory the defendant could justify
his claim that he was the owner of the paddy, after a final decision had been rendered against him to the

People vs. Claudio Teehankee, Jr., G.R. Nos. 111206-08, 6 October 1995)
The facts:
In 1991, Jussi Olavi Leino was taking Maureen Hultman to her home at Campanilla Street, Dasmarinas
Village, Makati. Roland John Chapman went with them. When they entered the village, Maureen asked
Leino to stop about a block away from her house, as she wanted to walk the rest of the way for she did
not want her parents to know that she was going home that late. Leino offered to walk with her while
Chapman stayed in the car and listened to the radio.
While Leino and Maureen were walking, a light-colored Mitsubishi box-type Lancer car, driven byaccused
Claudio Teehankee, Jr., came up from behind them and stopped on the middle of the road. Accused
alighted from his car, approached them, and asked: “Who are you? (Show me your) I.D.” When Leino
handed his I.D., the accused grabbed and pocketed the I.D., without bothering to look at it.
Chapman saw the incident. He stepped down on the sidewalk and asked accused: “Why are you bothering
us?” Accused pushed Chapman,dug into his shirt, pulled out a gun and firedat him. Chapmanfelt his upper
body, staggered for a moment, and asked: “Why did you shoot me?” Chapman crumpled on the sidewalk.
Leino knelt beside Chapman to assist him but accused ordered him to get up and leave Chapman alone.
Accused then turned his ire on Leino. He pointed gun at him and asked: “ Do you want a trouble?” Leino
said “no” and took a step backward.
The shooting initially shocked Maureen. When she came to her senses, she became hysterical andstarted
screaming for help. She repeatedly shouted: “Oh, my God, he’s got a gun. He’s gonna kill us. Will somebody
help us?” All the while, accused was pointing his gun to and from Leino to Maureen, warning the latter to
shut up. Accused ordered Leino to sit down on the sidewalk. Leino obeyed and made no attemptto move
away. Accused stood 2-3 meters away from him. Maureen continued to be hysterical. She could notstay
still. She strayed to the side of accused’s car. Accused tried but failed to grab her. Maureen circled around
accused’s car, trying to put some distance between them. The short chase lasted for a minute or two.
Eventually, accused caught Maureen and repeatedly enjoined her to shut up and sit down beside Leino.
Maureen finally sat beside Leino on the sidewalk.
For a moment, the accused turned his back from the two. He faced them again and shot Leino. Leinowas
hit on the upper jaw, fell backwards on the sidewalk, but did not lose consciousness. Leino heard another
shot and saw Maureen fall beside him. He lifted his head to see what was happening and saw accused
return to his car and drive away. Leino struggled to his knees and shouted for help. He noticed at least3
people who saw the incident.
As a result of the incident, 3 separate criminal cases were filed against accused Claudio Teehankee, Jr.
Initially, he was charged with: MURDER for the killing of ROLAND CHAPMAN, and two (2) FRUSTRATED
MURDER for the shooting and wounding of JUSSI LEINO and MAUREEN HULTMAN. When Hultman
subsequently died after 97 days of confinement at the hospital and during the course of the trial, the
Information for Frustrated Murder was amended to MURDER.
The defense:
Accused relied on the defense of denial and alibi. Accus ed claimed that during the shooting incident, he
was not anywhere near the scene of the crime, but in his house in Pasig. Accused averred that he only
came to know the 3 victims in the Dasmarinas shooting when he read the newspaper reports about it.
Accused admitted ownership of a box-type, silver metallic gray Mitsubishi Lancer, with plate number PDW
5
566. He, however, claimed that said car ceased to be in good running condition after its involvementin an
accident. Until the day of the shooting, his Lancer car had been parked in the garage of his mother’s house
in Dasmarinas Village. He has not used this car since then. Accused conceded that although the car was
not in good running condition, it could still be used.
The ruling:
Eyewitness identification and out-of-court identification.
The accused was convicted on the strength of the testimonies of 3 eyewitnesses who positively identified
him as the gunman. However, he vigorously assails his out-of-court identification by these eyewitnesses.
He starts by trying to discredit the eyeball account of Leino, the lone surviving victim of the crimes at bar.
Appellant urges: First, that Leino’s identification of him outside an unoccupied house in Forbes Park was
highly irregular; Second, that Leino saw his pictures on television and the newspapers before he identified
him; Third, that Leino’s interview at the hospital was never put in writing; Fourth, that the sketch of
appellant based on the description given by Leino to the CIS agents was suppressed by the NBI. It is
surmised that the sketch must have been among the evidence turned over to the NBI when the latter
assumed jurisdiction over the investigation; and, lastly, that Leino could not have remembered the face of
the accused. The shooting lasted for only five (5) minutes. During that period, his gaze could not have been
fixed only on the gunman’s face. His senses were also dulled by the five (5) bottles of beer he imbibed that
night.
It is understandable for the accused to assail his out-of-court identification by the prosecution witnesses
in his first assignment of error. Eyewitness identification constitutes vital evidence and, in most cases,
decisive of the success or failure of the prosecution. Yet, while eyewitness identification is significant, it is
not as accurate and authoritative as the scientific forms of identification evidence such as the fingerprint
or DNA testing. Some authors even describe eyewitness evidence as “inherently suspect.” The causes of
misidentification are known, thus:
Identification testimony has at least three components. First, witnessing a crime, whether as a victim or a
bystander, involves perception of an event actually occurring. Second, the witness must memorize details
of the event. Third, the witness must be able to recall and communicate accurately. Dangers of unreliability
in eyewitness testimony arise at each of these three stages, for whenever people attempt to acquire, retain,
and retrieve information accurately, they are limited by normal human fallibilities and suggestive
influences.
Out-of-court identification is conducted by the police in various ways. It is done thru show-ups where the
suspect alone is brought face to face with the witness for identification. It is done thru mug shots where
photographs are shown to the witness to identify the suspect. It is also done thru line-ups where a witness
identifies the suspect from a group of persons lined up for the purpose. Since corruption of out -of-court
identification contaminates the integrity of in-court identification during the trial of the case, courts have
fashioned out rules to assure its fairness and its compliance with the requirements of constitutional due
process. In resolving the admissibility of and relying on out-of-court identification of suspects, courts have
adopted the totality of circumstances test where they consider the following factors, viz: (1) the witness’
opportunity to view the criminal at the time of the crime; (2) the witness’ degree of attention at that time;
(3) the accuracy of any prior description given by the witness; (4) the level of certainty demonstrated by the
witness at the identification; (5) the length of time between the crime and the identification; and, (6) the
suggestiveness of the identification procedure.

Using the totality of circumstances test, the alleged irregularities cited by the accused did not resultin his
misidentification nor was he denied due process. There is nothing wrong in Leino’s identification of the
accused in an unoccupied house in Forbes Park. The records revea l that this mode was resorted to by the
authorities for security reasons. The need for security even compelled that Leino be fetched and escorted
from his house in Forbes Park by U.S. embassy security officials and brought to the house where he was to
make the identification. The Leinos refused to have the identification at the NBI office as it was cramped
with people and with high security risk. Leino’s fear for his safety was not irrational. He and his companions
had been shot in cold blood in one of the exclusive, supposedly safe subdivisions in the metropolis.
There is no hard and fast rule as to the place where suspects are identified by witnesses. Identification
may be done in open field. It is often done in hospitals while the crime and the criminal a re still fresh in
the mind of the victim.
Accused can’talsogripe thatLeino sawhis pictures and heard radioandTV accounts of the shooting before
he personally identified him. The records show that while Leino was still in the hospital, he was shown3
pictures of different men by the investigators. He identified the accused as the gunman from these
pictures. He, however, categorically stated that, before the mug shot identification, he has not seenany
picture of accused or read any report relative to the shooting incident. The burden is on accused to prove
that his mug shot identification was unduly suggestive. Failing proof of impermissible suggestiveness, he
cannot complain about the admission of his out-of-court identification by Leino.
There is no reason to doubt the correctness of the accused’s identification by Leino. The scene of the crime
was well-lighted by a lamp post. The accused was merely2-3 meters away whenhe shot Leino. The incident
happened for a full 5 minutes. Leino had no ill-motive to falsely testify against the accusedt. His testimony
at the trial was straightforward. He was unshaken by the brutal cross-examination of the defense counsels.
He never wavered in his identification of the accused. When asked how sure he was that the accusedwas
responsible for the crime, he confidently replied: “I’m very sure. It could not have been somebody else.”
The accused cannot likewise capitalize on the failure of the investigators to reduce to a sworn statement
the information revealed by Leino during his hospital interviews. It was sufficiently established that Leino’s
extensive injuries, especially the injury to his tongue, limited his mobility. The day he identified appellant
in the line-up, he was still physically unable to speak. He was being fed through a tube inserted in his
throat. There is also no rule of evidence which requires the rejection of the testimony of a witness whose
statement has not been priorly reduced to writing.
The SC also rejected the accused’s contention that the NBI suppressed the sketch prepared by the CIS on
the basis of the description given by Leino. There is nothing on the record to show that said sketch was
turned over by the CIS to the NBI which could warrant a presumption that the sketch was suppressed.The
suspicion that the sketch did not resemble the accused is not evidence. It is unmitigated guesswork.
The SC was also not impressed with the contention that it was incredible for Leino to have remembered
the accused’s face when the incident happened within a span of 5 minutes. Five minutes is not a short
time for Leino to etch in his mind the picture of the accused. Experience shows that precisely because of
the unusual acts of bestiality committed before their eyes, eyewitnesses, especially the victims to a crime,
can remember with a high degree of reliability the identity of criminals. The natural reaction of victims of
criminal violence is to strive to see the appearance of their assailants and observe the manner the crime
was committed. Most often, the face end body movements of the assailant create an impression which
cannot be easily erased from their memory. In this case, there is absolutely no improper motive for Leino
to impute a serious crime to the accused. The victims and the accused were unknown to each other before
their chance encounter. If Leino identifiedthe accused,it must be because the accusedwas the real culprit.
6
The SC also gave credence to the testimony of the other two witnesses. As to the testimony of Cadenas,
his initial reluctance to reveal to the authorities what he witnessed was sufficiently explained during the
trial – he feared for his and his family’s safety. The Court has taken judicial notice of the natural reticence
of witnesses to get involved in the solution of crimes considering the risk to their lives and limbs. In light
of these all too real risks, the court has not considered the initial reluctance of fear-gripped witnesses to
cooperate with authorities as an authorities as an indicium of credibility. As to the testimony of Mangubat,
the SC found nothing in the records to suspect that Mangubat would perjure himself.
2. Proof beyond reasonable doubt
According to the the accused, the trial court erred in not holding that the prosecution failed to establish
his guilt beyond reasonable doubt. First, he claims the trial court erred in citing in its Decision his
involvement in previous shooting incidents. Second, the NBI failed to conduct an examination to compare
the bullets fired from the gun at the scene of the crime with the bul lets recovered from the body of
Chapman. Third, the prosecution eyewitnesses described the gunman’s car as white, but the trial court
found it to be silver metalic gray. Fourth, the accused could not have been the gunman, for Mangubat said
that he overheard the victim Hultman plead to the gunman, thus: “Please, don’t shoot me and don’t kill
me. I promise Mommy, Daddy.” The accused also contends that a maid in a house near the scene of the
crime told Makati police Alberto Fernandez that she heard Maureen say: “Daddy don’t shoot. Don’t.” Fifth,
the NBI towed accused’s car from Dasmarinas Village to the NBI office which proved that the same was
not in good running condition. Lastly, the result of the paraffin test conducted on appellant showed he
was negative of nitrates.
The accused points to other possible suspects, viz:. ANDERS HULTMAN, since one of the eyewitnesses was
quoted in the newspapers as having overheard Maureen plead to the gunman: “Huwag, Daddy.”; and,(b)
JOSE MONTAÑO, another resident of Dasmariñas Village, who had a white Lancer car, also bearing
license plate number 566.
The accused, however, cannot hope to exculpate himself simply because the trial judge violated the rule
on res inter alios acta when he considered his involvement in previous shooting incidents. This rule has
long been laid to rest. The harmless error rule is also followed in our jurisdiction. In dealing with evidence
improperly admitted in trial, the court examines its damaging quality and its impact to the substantive
rights of the litigant. If the impact is slight and insignificant, the court disregards the error as it will not
overcome the weight of the properly admitted evidence against the prejudiced party.
In the case at bar, the reference by the trial judge to reports a bout the troublesome character of appellant
is a harmless error. The reference is not the linchpin of the inculpatory evidence appreciated by the trial
judge in convicting the accused. As aforestated, the accused was convicted mainly because of his
identification by 3 eyewitnesses with high credibility.
The NBI may have also failed to compare the bullets fired from the fatal gun with the bullets foundat the
scene of the crime. The omission, however, cannot exculpate the accused. The omitted comparison cannot
nullify the evidentiary value of the positive identification of the accused.
There is also little to the contention of the accused that his Lancer car was not in running condition.
Allegedly, this was vicariously proved when the NBI towed his car from Dasmariñas Village where itwas
parked to the NBI office. Again, the argument is negated by the records which show that said car was
towed because the NBI could not get its ignition key which was then in the possession of the accused.
Clearly, the car was towed not because it was not in running condition. Even the accused’s evidence show

that said car could run. After its repairs, the accused’s son, Claudio Teehankee III, drove it from the repair
shop in Banawe, Quezon City to Dasmarinas Village, in Makati, where it was parked.
Nor was the SC impressed by the alleged discrepancies in the eyewitnesses’ description of the color of the
gunman’s car. Leino described the car as light-colored; Florece said the car was somewhat white (“medyo
puti”); Mangubat declared the car was white; and Cadenas testified it was silver metallic gray. These
alleged discrepancies amount to no more than shades of differences and are not meaningful, referring as
they do to colors white, somewhat white and silver metallic gray. Considering the speed and shocking
nature of the incident which happened before the break of dawn, these slight discrepancies in the
description of the car do not make the prosecution eyewitnesses unworthy of credence.
The accused’s attempt to pin the crimes at bar on Anders Hultman, the adoptive father of Maureen
Hultman, deserves scant consideration. The accused cites a newspaper item where Maureen was allegedly
overheard as saying to the gunman: “Huwag, Daddy. Huwag, Daddy.” The evidence on record, however,
demonstrates that Anders Hultman could not have been the gunman. It was clearly established that
Maureen could not have uttered said statement for two (2) reasons: Maureen did not speak Tagalog, and
she addressed Anders Hultman as “Papa,” not “Daddy.” Moreover, Leino outrightly dismissed this
suspicion. While still in the hospital and when informed that the Makati police were looking into this
possibility, Leino flatly stated that Anders Hultman was NOT the gunman. Leino is a reliable witness.
The accused cannot also capitalize on the paraffin test showing he was negative of nitrates. Scientific
experts concur in the view that the paraffin test has “. . . proved extremely unreliable in use. The only thing
that it can definitely establish is the presence or absence of nitrates or nitrites on the hand. It cannot be
established from this test alone that the source of the nitrates or nitrites was the discharge of a firearm.
The person may have handled one or more of a number of substances which give the same positive
reaction for nitrates or nitrites, such as explosives, fireworks, fertilizers, pharmaceuticals, and leguminous
plants such as peas, beans, and alfalfa. A person who uses tobacco may also have nitrate or nitrite deposits
on his hands since these substances are present in the products of combustion of tobacco.” In numerous
rulings, we have also recognized several factors which may bring about the absence of gunpowder nitrates
on the hands of a gunman, viz: when the assailant washes his hands after firing the gun, wears gloves at
the time of the shooting, or if the direction of a strong wind is against the gunman at the time of firing. In
the case at bar, NBI Forensic Chemist, Leonora Vallado, testified and confirmed that excessive perspiration
or washing of hands with the use of warm water or vinegar may also remove gunpowder nitrates on the
skin. She likewise opined that the conduct of the paraffin test after more than seventy-two (72) hours from
the time of the shooting may not lead to a reliable result for, by such time, the nitrates could have already
been removed by washing or perspiration. In the Report on the paraffin test conducted on appellant,
Forensic Chemist Elizabeth Ayonon noted that when the accused was tested for the presence of nitrates,
more than 72 hours has already lapsed from the time of the alleged shooting.
3. The right to an impartial trial.
The the accused blames the press for his conviction as he contends that the publicity given to his case
impaired his right to an impartial trial. He postulates there was pressure on the trial judge for high-ranking
government officials avidly followed the developments in the case (as no less than then Vice-President
Estrada and then DOJ Secretary Drilon attended some of the hearings and, President Aquino even visited
Hultman while she was still confined at the hospital). He submits that the trial judge failed to protect him
from prejudicial publicity and disruptive influences which attended the prosecution of the cases.
The SC did not sustain the accused’s claim that he was denied the right to impartial trial due to prejudicial
publicity. It’s true that the print and broadcast media gave the case at bar pervasive publicity, just like all
7
high profile and high stake criminal trials. Then and now, we rule that the right of an accused to a fair trial
is not incompatible to a free press. To be sure, responsible reporting enhances an accused’s rightto a fair
trial for, as well pointed out, “a responsible press has always been regarded as the handmaiden of effective
judicial administration, especially in the criminal field . . . The press does not simply publish information
about trials but guards against the miscarriage of justice by subjecting in the police, prosecutors, and
judicial processes to extensive public scrutiny and criticism.”
Pervasive publicity is not per se prejudicial to the right of an accused to fair trial. The mere fact thatthe
trial of appellant was given a day-to-day, gavel-to-gavel coverage does not by itself prove that the publicity
so permeated the mind of the trial judge and impaired his impartiality. For one, it is impossible toseal the
minds of members of the bench from pre-trial and other off-court publicity of sensational criminal cases.
The state of the art of our communication s ystem brings news as they happen straight to our breakfast
tables and right to our bedrooms. These news form part of our everyday menu of the facts and fictions of
life. For another, our idea of a fair and impartial judge is not that of a hermit who is out of touch with the
world. We have not installed the jury system whose members are overly protected from publicity lest they
lose their impartiality. Our judges are learned in the law and trained to disregard off-court evidence and
on-camera performances of parties to a litigation. Their mere exposure to publications and publicity stunts
does not per se fatally infect their impartiality.
At best, the accused can only conjure possibility of prejudice on the part of the trial judge due to the
barrage of publicity that characterized the investigation and trial of the case. The SC had previously
rejected this standard of possibility of prejudice and adopted the test of actual prejudice as we ruledthat
to warrant a finding of prejudicial publicity, there must be allegation and proof that the judges have been
unduly influenced, not simply that they might be, by the barrage of publicity. In the case at bar, the records
do not show that the trial judge developed actual bias against appellant as a consequence of the extensive
media coverage of the pre-trial and trial of his case. The totality of circumstances of the case does not
prove that the trial judge acquired a fixed opinion as a result of prejudicial publicity which is incapable of
change even by evidence presented during the trial. The accused has the burden to prove this actual bias
and he has not discharged the burden. There is no evidence showing that the trial judge allowed the
proceedings to turn into a carnival. Nor did he consent to or condone any manifestation of unruly or
improper behavior or conduct inside the courtroom during the trial of the case at bar.
Parenthetically, the accused should be the last person to complain against the press for prejudicial
coverage of his trial. The records reveal he presented in court no less than 7 newspaper reporters and
relied heavily on selected portions of their reports for his defense. The defense’s documentary evidence
consists mostly of newspaper clippings relative to the investigation of the case at bar and which appeared
to cast doubt on his guilt. The press cannot be fair and unfair to appellant at the same time.
Finally, it would not be amiss to stress that the trial judge voluntarily inhibited himself from further hearing
the case, but the SC, nothing in the conduct of the proceedings to stir any suspicion of partiality against
the trial judge, directed the trial judge to proceed with the trial to speed up the administration of justice.
4. The presence of treachery
The accused claims that treachery was not present in the killing of Hultman and Chapman, and the
wounding of Leino for it was not shown that the gunman consciously and deliberately adopted particular
means, methods and forms in the execution of the crime. The accused asserts that mere suddenness of
attack does not prove treachery.
 8

The 3 Informations charged the accused with having committed the crimes with treachery and evident (3) guilty beyond reasonable doubt of the crime of Frustrated Murder, qualified by treachery, for the
premeditation. Evident premeditation was correctly ruled out by the trial court for, admittedly, the shooting of Jussi Olavi Leino, and sentenced to suffer the indeterminate penalty of 8 years of prision mayor
shooting incident was merely a casual encounter or a chance meeting on the street since the victims were as minimum, to 14 years and 8 months of reclusion temporal as maximum, and to pay the said offended
unknown to the accused and vice-versa. It, however, appreciated the presence of the qualifying party the following amounts: P30,000 as indemnity for his injuries; P118,369.84 and equivalent in
circumstance of treachery. Philippine Pesos of U.S.$55,600.00, both as actual damages; P1,000,000 as moral damages; and,
P2,000,000 as exemplary damages.
On the other hand, the prosecution failed to prove treachery inthe killing of Chapman.Prosecution witness
Leino established the sequence of events leading to the shooting. He testified that for no apparent reason, (4) In all three cases, to pay each of the 3 offended parties the sum of P1,000,000, or a total of P3,000,000,
the accused suddenly alighted from his car and accosted him and Maureen Hultman who were then for attorney’s fees and expenses of litigation; and
walking along the sidewalk.
(5) To pay the costs in all 3 cases.
Appellant questioned who they were and demanded for an I.D. After Leino handed him his I.D., Chapman
appeared from behind Leino and asked what was going on. Chapman then stepped down on the sidewalk
and inquired from appellant what was wrong. There and then, the accused pushed Chapman, pulled a gun
from inside his shirt, and shot him. The gun attack was unexpected. “Why did you shoot me?” was all
Chapman could utter. Concededly, the shooting of Chapman was carried out swiftly and left him with no
chance to defend himself. Even then, there is no evidence on record to prove that the accused consciously
and deliberately adopted his mode of attack to insure the accomplishment of his criminal design without
risk to himself. The accused acted on the spur of the moment. Their meeting was by chance. They were
strangers to each other. The time between the initial encounter and the shooting was short and unbroken.
The shooting of Chapman was thus the result of a rash and impetuous impulse on the part of the accused
rather than a deliberate act of will. Mere suddenness of the attack on the victim would not, by itself,
constitute treachery. Hence, absent any qualifying circumstance, the accused should only be held liable
for Homicide for the shooting and killing of Chapman.

As to the wounding of Leino and the killing of Hultman, treachery clearly attended the commissionof the
crimes. The evidence shows that after shooting Chapman in cold blood, the accused ordered Leino to sit
on the pavement. Maureen became hysterical and wandered to the side of appellant’s car. When the
accused went after her, Maureen moved around his car and tried to put some distance between them.
After a minute or two, the accused got to Maureen and ordered her to sit besi de Leino on the pavement.
While seated, unarmed and begging for mercy, the two were gunned down by the accused . Clearly,the
accused purposely placed his two victims in a completely defenseless position before shooting them. There
was an appreciable lapse of time between the killing of Chapman and the shooting of Leino and Hultman
– a period which the accused used to prepare for a mode of attack which ensured the execution of the
crime without risk to himself.

Penalties:(Note: Mr. Teehankee was pardoned in 2008)

(1) guilty beyond reasonable doubt of the crime of Homicide for the shooting of Roland John Chapman. He
was sentenced to suffer an indeterminate penalty of imprisonment of 8 years and 1 day of prisionmayor
as minimum to 14 years, 8 months and 1 day of reclusion temporal as maximum, and to pay the heirs of
the said deceased the following amounts: P50,000 as indemnity for the victim’s death; and, P1,000,000 as
moral damages.

(2) guilty beyond reasonable doubt of the crime of Murder, qualified by treachery, for the shooting of
Maureen Navarro Hultman. He was sentenced to suffer imprisonment of reclusion perpetua, andto pay
the heirs of the said deceased the following amounts: P50,000 as indemnity for her death; P2,350,461.83
as actual damages; P564,042.57 for loss of earning capacity of said deceased; P1,000,000 as moral
damages; and P2,000,000 as exemplary damages.

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. MANUEL CRISTOBAL and JOLITO
CRISTOBAL, accused-appellants.
D E C I S I ON
BELLOSILLO, J.:
MANUEL CRISTOBAL and JOLITO CRISTOBAL, brothers, were found guilty by the Regional Trial Court of
Isabela of Robbery with Multiple Rape and sentenced to reclusion perpetua, and to pay jointly and
severally complaining witness Luzviminda Cleto Garcia P50,000.00 for moral damages, P6,900.00 for
actual damages, and the costs. They now seek a reversal on the theory that they were not positively
identified by the victim and that they were somewhere else at the time of the commission of the offense;
alibi, in other words.
Following is the evidence for the prosecution adduced through complaining witness Luzviminda C. Garcia
and her sister Evena Cleto: On 8 September 1991, at eight oclock in the evening, Luzviminda was sewing
clothes in the receiving room of her house situated in Bayabo East, Tumauini, Isabela. Her front door,
which was illuminated by an electric bulb, was closed but unlocked. She was with her sister Evena and
brother-in-law Gary Garcia. Luzvimindas husband was at that time in Pangasinan. Her three (3) children
were at their mezzanine floor preparing for bed. As she was feeling tired, Luzviminda requested Evena to
continue with the sewing. When she was about to join her children at the mezzanine, six (6) armedmen
barged in through the front door. She readily recognized the brothers Manuel Cristobal and Jolito Cristobal
as she was familiar with them although she did not know their names then.She used to see Manuel at the
market place while his brotherJolitoworked in her farmin the past for three (3) days. Jolitowas alsoselling
unbranded medicines and flat iron.
As soon as the Cristobal brothers were in control of the situation, Manuel ordered Evena and Gary to lie
flat on the floor face down. The other man, who posted himself near Luzviminda and whom the latter
described as elderly, ransacked the house while the rest of the intruders stood guard. Among the items
they took were pieces of jewelry, a cassette recorder, and ladies and mens shoes with a total value
of P6,900.00. Then Manuel, Jolito and the old man took turns in raping Luzviminda who could not offer
any resistance as the three (3) malefactors were all armed. After satisfying their lust, Jolito tied Luzviminda
and her companions with shoe laces and warned them not to report the incident to the authorities.
The following day Luzviminda, accompanied by the barangay captain and a councilman, went to the
Municipal Hall of Tumauini and reported the outrage committed against her and her family. She was
investigated by the police and her report was reflected in the police blotter. On 10 September 1991 she
executed a sworn statement regarding her unfortunate experience and submitted herself to medical
examination.
On the other hand, the defense presented PO3 Arnold Lugo who testified that he was the one who entered
the incident in the police blotter on 9 September 1991, specifically that an unidentified male suspect
armed with M-16 rifle and a handgun wearing a bonet, ransacked their residence at about eight oclock
p.m. and they took assorted clothings, canned goods and jewelries afterwhich they left. The entry was
purportedly based on complaining witness report.
Another policeman, SPO1 Antonio Manuel Jr., narrated that Luzviminda was not able to identify the
culprits when she reported the incident so that he had to inquire about them from her neighbors. He also
questioned complainant in her house on 10 September 1991. There Luzviminda described the suspects
and told him that she would recognize them if she saw them again.
9
Bienvenido Eugenio, who claimed to be a close acquaintance of the Cristobal brothers, volunteered to
testify for them. He offered an alibi. He declared that at seven in the morning of 8 September 1991 he,
Manuel, Jolito and a certain Gavino Limit trekked to the mountains at Antagan 1st, about twenty (20)
kilometers from the Tumauini townproper,to gather wood andstayed there for three (3) days, after which
they returned to Tumauini. Manuel corroboratedBienvenidos testimony. Jolito was not presented as a
witness.
In finding the Cristobal brothers guilty of robbery with rape the trial court relied heavily on the testimony
of Luzviminda which it found worthy of belief.Thus the court a quo said
x x x x The complainant Luzviminda Garcia during her testimony on Court answered the questions of the
prosecution as well as of the defense and the Court in a brave and straightforward manner. She was
shedding tears, sobbing and crying during her testimony. She answered questions spontaneously.The
Court likewise observed that when she described the manner by which she was raped, she was sohonest
and truthful in narrating even the minutest details of the incident.
The trial court disbelieved the testimonies of the defense witnesses. It found Bienvenido to be a prepared,
rehearsed and perjured witness and noted that he volunteered to testify only after the prosecution rested
its case despite several opportunities to do so; PO3 Lugos report was inaccurate, inconsistent and
confusing; and, SPO1 Manuel Jr. contradicted himself on the witness stand on material points.
Assailing the court a quo for not acquitting them, accused-appellants submit that they were not positively
identified by Luzviminda as among those who robbed and raped her. Accused-appellants also argue that
the court below erred in finding that Bienvenido was a prepared, rehearsed and perjured witness because
he was able to answer immediately the date of the incident in the instant case.
Accused-appellants claim that they were not positively identified by Luzviminda as the culprits as evident
from her sworn statement executed before the investigating police officer on 10 September 1991 thus
13. Q. Showing to you this person in the name of Jolito Cristobal. What can you say about this?
A. He is not one of those who raped me, but he is positively identified by my brother-in-law Gary Garcia to
be one of those who were outside our house, sir. And I am also positive that his elder brother by the name
of Manny Cristobal was one of those who raped me, sir.
Accused-appellants also point to the pertinent narration in Luzvimindas supplementary narration dated
12 September 1991
5. Q. And do you know the persons who robbed and sexually abused you?
A. I came to know to (sic) this police station to be the persons of Jolito Cristobal and his brother Manny
Cristobal, both residents of Brgy. Maligaya, Tumauini, Isabela, sir.
Accused-appellants then connect their prior arguments with the entry in the police blotter showing doubt
as to the identification of the suspects, which fact was corroborated by SPO1 Manuel, Jr.
Accused-appellants fail to convince. Their asseveration that the court below erred in its factual findings,
particularly on the credibility of the witnesses, must fail. Findings of fact and assessment of credibility of
witnesses are matters best left to the trial court because of its unique position of having observed that
elusive and incommunicable evidence of the witnesses deportment on the stand while testifying, which
opportunity is denied to the appellate courts. [1]doctrinally, findings of fact of trial courts are accorded the
 10

highest respect and weight. They are normally sustained unless material facts and circumstances have of deadly weapons. Dwelling and aid of armed men aggravated the crime. Applying Art. 63, par. (1), of the
been overlooked, misunderstood or misapplied.[2] We find none in the case before us and thus, the facts Revised Penal Code, [6] the proper imposable penalty would have been death. At the time of the
as found by the court a quo, must be sustained. commission of the crime, however, the imposition of death was proscribed by the 1987 Constitution and
was reimposed only effective 31 December 1993. Thus, the penalty of reclusion perpetua was properly
There is no merit in accused-appellants contention that they were not positively identified by decreed by the trial court.
Luzviminda. While Luzviminda might have failed to categorically specify the names of her robber-ravisher
in her sworn statements executed before the police officers, she was however familiar with their faces WHEREFORE, the decision of the Regional Trial Court of Isabela[7] finding MANUEL CRISTOBAL and JOLITO
that she could point to them in court. But assuming that there was some variance in her sworn statements CRISTOBAL GUILTY of ROBBERY WITH RAPE and sentencing them to suffer the penalty of reclusion
and her testimony in court, suchinconsistencies, if anybetween her testimony in open courtand her sworn perpetua, to pay jointly and severally to Luzviminda Cleto Garcia P50,000.00 for moral damages, P6,900.00
statements given to investigators do not necessarily discredit the witness since ex-parte affidavits are for actual damages and the costs, is AFFIRMED. The amount of P50,000.00 as civil indemnity is likewise
almost always incomplete. Sworn statements are generally considered to be inferior to the testimony awarded to her in line with prevailing jurisprudence. [8]
given in open court.[3]
SO ORDERED.
Accused-appellants endeavored to discredit Luzviminda by showing that this was not the first time that
complaining witness filed a case for rape. They narrated that she had priorly filed a charge for rape but the
same was dismissed when the accused therein opted to settle the case amicably. We find this insinuation
not to diminish in any way the weight accorded to the credibility of Luzviminda. In criminal cases, except
those involving quasi-offenses or those allowed by law to be settled through mutual concessions, an offer
of compromise is an implied admission of guilt. [4] Consequently, the compromise did not weaken but
buttressed instead Luzvimindas claim that she was raped. Thus accused-appellants, in attempting to infuse
doubt on complaining witness credibility, unwittingly strengthened the belief that comp laining witness
was telling the truth.

In the face however of Luzvimindas sworn statement where she forthrightly declared that Jolito was not
among her rapists, we cannot subscribe to the trial courts finding that he was positively identifiedby her
as one of her rapists despite her testimony in open court that he likewise sexually abused her.Nonetheless
this finding would not disturb our conclusion that the Cristobal brothers are guilty of raping and robbing
Luzviminda as the element of conspiracy was indubitably established.

The concerted acts of the malefactors showed unity of purpose. When they barged into the house of
complaining witness, they positioned themselves as to deny their victims any avenue for escape. They
were intent in robbing Luzviminda. Although it may be argued that when they entered the house of
Luzviminda their initial purpose was only to rob, the rest of the unwelcome visitors obviously manifested
their consent to Manuel raping Luzviminda as they all stood guard behind him. They did not do anything
to deter him from raping her; on the contrary, they showed their eargerness to follow suit in the dastardly
sexual misconduct. Hence, conspiracy having been clearly established, the act of one was the act of all.

We agree with the observation of the court below that Bienvenido Eugenio was a prepared, rehearsed and
perjured witness for the defense. His testimony on the alibi of accused-appellants does not at all deserve
consideration. The alibi failed to meet the requisites for a valid defense. It was not enough that they were
somewhere else when the crime transpire. They should have established in addition that they were sofar
away that it was physically impossible for them to be present at the crime scene or its immediate vicinity
at or about the time of its commission. [5] Although the place where they claimed to be at the time of the
commission of the crime was twenty (20) kilometers away from Tuma uini town proper, the possibility of
being physically present at the crime scene or its immediate vicinity existed.

Pursuant to Art. 294, par. (2), of the Revised Penal Code, which was the applicable law at the time of the
crime was committed, when the robbery accompanied by rape is committed with the use of a deadly
weapon or by two (2) or more persons, the penalty is reclusion perpetua to death. The crime of robbery
with rape in the instant case was shown to have been committed by two (2) or more persons with the use

PEOPLE VS CARMEN
Facts: The trial court rendered a decision and the accused-appellants were all found guiltybeyond
reasonable doubt of the crime of Murder after having performed a cultic healing pray-over which resulted
to the death of Randy Luntayao. They were sentenced to suffer the penalty of RECLUSION PERPETUA.
Issue: WON accused-appellants can be held liable for reckless imprudence resulting in homicide,
considering that the information charges them with murder.
Held: Yes. Conviction modified to reckless imprudence resulting in homicide. Killing a person w/ treachery
is murder even if there is no intent to kill. When death occurs, it’s presumed to be the natural consequence
of physical injuries inflicted. In murder qualified by treachery, it’s required only that there is treachery in
the attack, & this is true even if the offender has no intent to kill the person assaulted
One who commits an intentional felony is responsible for all the consequences which may naturallyand
logically result therefrom, whether foreseen or intended or not.
Intent is presumed from the commission of an unlawful act. The presumption of criminal intent mayarise
from the proof of the criminal act. Hence, they are liable for all the direct and natural consequences of
their unlawful act, even if the ultimate result had not been intended.
The strange procedure resulted in the death of the boy. Thus, accused-appellants had no criminal intent
to kill the boy. Their liability arises from their reckless imprudence because they ought that to knowtheir
actions would not bring about the cure. They are, therefore, guilty of reckless imprudence resulting in
homicide and not of murder.
[G.R. No. 139179. April 3, 2002]
PEOPLE OF THE PHILIPPINES, appellee, vs. WILFREDO TOLENTINO y ESPERAT and JONATHAN FABROS y
CASTRO, accused.
JONATHAN FABROS y CASTRO, appellant.
D E C I S I ON
PANGANIBAN, J.:
An appeal in a criminal case opens the entire records to review. The appellate court may pass uponevery
circumstance favorable to the accused. In the present case, the prosecution failed to prove the existence
of conspiracy beyond reasonable doubt. Neither was it able to show that appellant was an accomplice or
accessory. Hence, he must be acquitted on reasonable ground.
The Case
Jonathan Fabros y Castro appeals the May 27, 1999 Decision [1] of the Regional Trial Court (RTC) of
Zamboanga City (Branch 17) in Criminal Case No. 13698, finding him guilty of murder and sentencing him
to reclusion perpetua. The dispositive portion of the Decision reads as follows:
WHEREFORE, finding the accused Wilfredo Tolentino and Jonathan Fabros guilty beyond reasonable doubt
of the crime of murder, and taking into consideration the aggravating circumstance of dwelling (morada)
11
without any mitigating circumstance to offset the same, the Court hereby sentences the above-named
accused separately to suffer the penalty of [r]eclusion [p]erpetua, to pay separately the heirs of the victim
the sum of P50,000.00 as moral damages, the sum of P50,000.00 as exemplary damages, and to indemnify
the said heirs [in] the sum of P15,000.00 as actual damages, and to pay the costs. [2]
The Information, dated March 2, 1996, charged appellant as follows:
That on or about February 28, 1996, in the City of Zamboanga, Philippines, and within the jurisdiction of
this Honorable Court, the above-named accused, armed with a piece of wood and knife, conspiring and
confederating together, mutually aiding andassisting with one another, by means of treachery and evident
premeditation and with intent to kill, did then and there without any warning, assault, attack and stab with
the use of said weapons that they were armed with, at the person of HERNAN SAGARIO y CUESTA, thereby
inflicting mortal wounds on the different parts of the latters body which directly caused his death, to the
damage and prejudice of the heirs of said victim.
That the commission of the above-stated offense has been attended by the following aggravating
circumstances, to wit:
1. Abuse of superior strength; and
2. Dwelling. [3]
With the assistance of counsel, [4] appellant pleaded not guilty when arraigned on June 7, 1996. [5] After due
trial, the RTC rendered the assailed Decision.
The Facts
Version of the Prosecution
The prosecutions version of the facts is summarized by the Office of the Solicitor General as follows: [6]
On February 28, 1996 around 7:30 in the evening, appellant and his cousins, Sheila Guilayan and Merwin
Ledesma, were at their house in Luyahan, Pasonanca, Zamboanga City when their neighbor Wilfredo
Tolentino called them. When asked what was it all about, Wilfredo simply motioned to them to come to
his house located just across the road. Once they were inside the house, Wilfredo immediately revealed
his plan to kill Hernan Sagario, Sheilas stepfather. Wilfredo explained that it was the only way to free
Sheilas mother - appellants aunt - of the sufferings being caused by Hernan. Wilfredo then instructed
Merwin to go back to the house and get the bolo of Hernan. Merwin obliged, got the bolo, and gave it to
Wilfredo. Thereafter, they were told by Wilfredo to go home and wait for Hernan.
Around 8:30 in the evening, Hernan arrived. He went directly to the kitchen and fixed the bag of rice he
was carrying. Meanwhile, appellant, together with Sheila and Merwin, just stayed quiet in the living
room. Moments later, Wilfredo with a 2x2 piece of wood in his hand entered the house. He then followed
Hernan towards the kitchen. When about an armslength away from Hernan, Wilfredo, without saying a
word, immediately walloped Hernan on the right side of the neck sending the latter unconscious andfalling
face down to the ground. Wilfredo immediately instructed appellant and Merwin to help him bring Hernan
out of the house. Lifting Hernan out of the house, Wilfredo held him by the neck while both appellant and
Merwin grasped his feet. They then carried Hernan towards the creek about seven meters away from the
house.

Upon reaching the creekside, the three stopped and moved closer to the water. At this juncture, Wilfredo
successively stabbed Hernan on different parts of the body causing the latters instant death. After
throwing the victims lifeless body in the creek, the three immediately left.
The post-mortem examination on the victims cadaver disclosed that the cause of his death was cardio-
respiratory arrest due to shock and hemorrhage secondary to [a] stab wound penetrating the chest.
(Citations omitted)
Version of the Defense
Appellant, on the other hand, presented the following version of the facts: [7]
Accused Jonathan Fabros and Wilfredo Tolentino both denied killing the victim. Instead, they pointed to
each other as the one who killed Hernan Sagario. Fabros pointed to Tolentino as the assailant and the
latter also fingered the former as the killer of Sagario.
Relying on his lone testimony and corroborating the testimony of prosecution witness Sheila Guilayan,
accused Fabros narrated that he is a resident of Luyuhan, Pasonanca, particularly in the house of his auntie
Amparo Guilayan (the common-law wife of Hernan Sagario), together with his cousins Merwin Ledesma
and Sheila Guilayan.
On 28 February 1996, at around 7:00 p.m., he returned home to Luyahan after his work at Astoria Hotel
as a waiter. Sheila was at home when he arrived. Shortly thereafter, their neighbor, accused Tolentino,
came over and called for Sheila. Sh[ei]la stood up and went to the house of Tolentino, leaving behind
Fabros and Merwin Ledesma. After a while, he and Ledesma heard Sheila crying and the two went to the
house of Tolentino. At the house of Tolentino, Fabros and Ledesma asked Sheila why she cried. [She]
disclosed Tolentinos plan to kill her stepfather Hernan Sagario. When asked for his motive to kill Hernan
Sagario, Tolentino merely reasoned that he just wanted to help their auntie Amparo get rid of her
problems. When they expressed apprehension [about] being implicated and tried to prevent Tolentino
from pursuing his plan, the latter told them not to worry; for he will take care.
When Tolentino saw their uncle Hernan coming towards the house, he ordered them to go home and they
obeyed. As he arrived, Hernan ordered Fabros to boil water.Afterwards, Hernan went out of the house to
buy Ovaltine. When Hernan returned, Tolentino approached him and they talked for about two
minutes. Afterwards, Tolentino went to his house while their uncle Hernan told him (Fabros) to check if
the water was already boiling. Jonathan went to the kitchen while their uncle placed the rice he brought
in a container. At that instance, Jonathan heard the sound pok, and saw Tolentino holding a piece of wood
(2 x 2). Then, he saw his uncle f[a]ll down slowly, his chest hitting the corner edge of a table. Tolentino
approached his uncle and kicked him. Then he ordered Fabros to come near him and carry Hernan by his
feet. Afraid that Tolentino will hit him with the piece of wood, Fabros held his uncle by the feet while
Tolentino pulled Hernan by the shirt and he just followed Tolentino. Tolentino brought Hernan near the
river. When Jonathan noticed that his uncle regained consciousness, he ran away towards a banana
plantation and from there he saw Tolentino [stab] Sagario on the chest. After stabbing the victim,
Tolentino pushed and waded him into the water. Scared, Jonathan ran home. About twenty minutes later,
Tolentino arrived and with thumbs up sign, he said, Okey na!. Jonathan also observed that there was blood
on the shoulder of Tolentino. The latter then called the three (3) and warned them that if they will tell
other people, he will kill them. Out of fear, they just followed whatever Tolentino told them.
By reason of fear of Tolentinos threat, Jonathan told the police that he did not know what happened. On
01 March 1996, however, he was arrested for the death of Hernan Sagario on account of an information
12
received by the police identifying him as the assailant. He was brought to the Sta. Maria Police Station and
thereat he was told by the police that if he will not admit, they will show him the witness, which the police
later did by showing to him his co-accused Tolentino. On seeing Tolentino, he declared that he (Tolentino)
was the one who killed the victim.
However, on 14 July 2000, long after the trial courts decision had become final and executory on his part,
Wilfredo Tolentino, apparently conscience-stricken, executed an affidavit admitting sole responsibility for
the death of Hernan Sagario and retracted his testimony implicating accused-appellant Jonathan
Fabros. His affidavit is herein reproduced as follows:
I, WILFREDO TOLENTINO y ESPERAT, 65 years old, widower, Filipino, a convicted prisoner with the San
Ramon Prison and Penal Farm in Zamboanga City, after having been duly sworn to in accordance with law
hereby depose and state:
That I was convicted for the crime of Murder in Criminal Case No. 13698 entitled The People of the
Philippines, Plaintiff, versus, Wilfredo Tolentino y Esperat and Jonathan Fabros y Castro, accused, which
Decision was promulgated on May 30, 1999 and ha[s] become final;
That of the four years I have been in prison, I have contemplated on the consequences of my acts and have
been conscience stricken causing me sleepless nights and deep pity [for] my co-accused Jonathan Fabros
whom I have wrongfully imputed to be the killer of the victim Hernan Sagario y Cuesta. As he appealed the
Decision, [maybe] I still have the chance to rectify the wrong I have done to him and tell the Honorable
Court what actually happened [o]n the night of February 28, 1996, as hereunder narrated;
That I had known Hernan Sagario earlier in 1994 when he was still a security guard and he attempted to
shoot me with his service firearm and although we had amicably settled the matter between us, whenhe
came to be my neighbor, I would remember that incident and my old grudge against him would be
rekindled;
That earlier that night of February 28, 1996, I came home quite drunk [after] my drinking spree withmy
relatives across the river and one of the topics we discussed was about the incident when Hernan Sagario
attempted to shoot me. As I recalled that incident, my old grudge against him resurfaced and I resolved
right then and there to take my revenge on Hernan. So when he came home and he was in the kitchen,I
took hold of a piece of wood and hit him with it and when he fell down unconscious, I dragged his body
outside of the house, ordering Jonathan Fabros who was then in the kitchen to help me carry the body of
Hernan outside or else he would also become my victim.Jonathan unwillingly assisted me carry the body
of Hernan outside and upon my direction, we dragged the body of Hernan towards the river where to
finish him off, I stabbed [him] in the chest and pushed him down into the water to hide his body. For his
part, Jonathan left me when the body reached the river;
That after [the] killing, I threatened Jonathan Fabros, Neneng (the daughter of Hernans live-in-partner)
and Weng-weng, a cousin of Neneng and Jonathan[,] never to report the incident to any one or else they
could become my next victim;
That during the investigation of the killing, I pointed to Jonathan as the killer of Hernan, thinking that I
would not be implicated. Even when I was also charged for the killing, I was confident that I would be
acquitted if I would point to Jonathan as the killer. During the trial of the case, I bribed Jonathan andeven
gave P20,000.00 to a middle man to effect the pay off but Jonathan returned the money to me saying he
could not admit what he did not commit;

That my conscience ha[d] been greatly troubled by denying Jonathan his future by [my] own evil acts and
by this affidavit hopes to correct the wrongs I had done to Jonathan Fabros;
That I am executing this affidavit [to] attest to the truth of the foregoing narration of facts and to appeal
to the Court authorities to rectify the wrongs I had done to Jonathan Fabros and I am willing to testify in
court o[n] these statements narrated.
Ruling of the Trial Court
The trial court held that the prosecutions evidence positively identified Wilfredo Tolentino as the person
who had hit the victim with a piece of wood and later stabbed him with a bolo. It also ruled that the killing
was qualified by treachery and attended by the aggravating circumstance of dwelling.
The court a quo observed that overt and positive acts of appellant manifested his approval of the killing
and the concurrence of his acts with those of the other accused.[8] Thus, the RTC concluded that Fabros
was a co-conspirator and should be held equally responsible for the murder.
Hence, this appeal. [9]
The Issue
In his Brief, appellant assigns the following alleged errors for our consideration:
I scene of the crime or even knowledge of the plan or acquiescence thereto are not sufficient grounds to
The Court a quo gravely erredin convicting hereinAccused-appellant JonathanFabros of the crime charged
notwithstanding the categorical statement of Prosecution Witness Sheila Guilayan that it was Accused
Wilfredo Tolentino who actually killed the victim, Hernan Sagario.
II
The Court a quo gravely erred in convicting accused-appellant notwithstanding Wilfredo Tolentinos
categorical admission of guilt [of] the crime charged. [10]
The errors boil down to the sufficiency of the prosecution evidence.
This Courts Ruling
The appeal is meritorious; appellant should be acquitted.
Main Issue:
Sufficiency of Prosecution Evidence
The RTC held that the assistance of appellant in bringing the body of the victim from the house to the river
bank where the latter was allegedly stabbed to death positively showed that the former had conspired in
the commission of the crime. [11] In its abbreviated nine-page Brief, the Office of the Solicitor General agrees
that conspiracy has been duly proven. On the other hand, appellant argues that his fleeting participation
in helping carry the victims body to the river bank did not indicate unity of purpose or design. We agree
with him.
An appeal in a criminal action opens the whole case to review. This implies that the Court may pass upon
every circumstance favorable to the accused. In People v. Manambit, [12] the Court explained thus:
13
Indeed, the Supreme Court is clothed with ample authority to review matters, even those not raised on
appeal, if it finds that their consideration is necessary in arriving at a just disposition of the case. It is a
matter of justice thatthe twoother appellants be exonerated of the charges. This we do because an appeal
in a criminal action opens the whole case for review and this includes the review of the penalty and
indemnity. Every circumstance in favor of the accused shall be considered. [13]
No Conspiracy
Even the Office of the Solicitor General admits that appellant did not directly kill the victim. It, however,
urges us to convict him on the basis of conspiracy.
In theory, conspiracy exists when two or more persons come to an agreement concerning the commission
of a felony and decide to commit it. [14] To prove conspiracy, the prosecution must establish the following
three requisites: (1) two or more persons came to an agreement, (2) the agreement concerned the
commission of a crime, and (3) the execution of the felony was decided upon. [15] Once conspiracy is
established, the act of one becomes the act of all. [16]
Well-settled is the rule that the existence of conspiracy cannot be presumed.[17] Quite the contrary, the
evidence for it must be shown beyond reasonable doubt.[18] As this Court has repeatedly stated, criminal
conspiracy must be founded on facts, not on mere surmises or conjectures.[19] Prior agreement or assent
is usually inferred from the acts of the accused showing concerted action, common design and objective,
actual cooperation, and concurrence of sentiments or community of interests.[20] Mere presence at the
hold a person liable as a conspirator. [21] Therefore,the task in every case is to determine whether the
particular acts established by the requisite quantum of proof reasonably yield that inference. [22]
In the case before us, we agree that the culpability of Tolentino was clearly established, but we are also
convinced that the evidence fails to show the culpability of appellant beyond reasonable
doubt.[23] Because, unquestionably, the latter did not personally inflict any of the fatal flows, he can be
held liable as a principal, only if conspiracy is proven. [24] To recall, Sheila Guilayan, the prosecution
eyewitness, narrated the circumstances surrounding the killing of Hernan Sagario as follows:
Q On February 28, this year, 1996, at around 7:30 oclock in the evening, can you still remember where
were you?
A Yes, I could still remember, I was in our house.
Q You were in your house, are you referring to your house in Pasonanca, Luyahan?
A Yes.
Q Can you also remember who were with you in that evening of February 28, 1996 in your house at
Pasonanca, Luyahan?
A Yes, I can still remember, my companions were Jonathan Fabros an d Melwin Ledesma.
xxxxxxxxx
Q And you said while you were in the sala sitting down, writing, there was an incident that transpired,will
you please tell us what transpired?
ATTY. JIMENEZ:
 14

That will ask for narration, what transpired? A Well, I just cried until my two cousins heard me and they, the two, also went to the house of Tolentino.

COURT: Q While your two cousins were already in the house of Tolentino, what happened next?

Be more specific on that. A My cousins asked me why I was crying.

PROSECUTOR ORILLO: Q And then?

Q What happened? A They asked Tolentino why I was crying.

A I was called by Tolentino and he requested me to go to their house. Q What did you do next?

Q You are referring to Wilfredo Tolentino? A I just cried and kept on telling him not to do it because we will be implicated and also my mother [was]
not [t]here.
ATTY. JIMENEZ:
Q And how about Tolentino, what did he do?
Leading, Your Honor.
A Well, he again told me just not to tell it to anybody because if I [was] going to tell it to anybody, he will
COURT: also kill us.
Sustained. Q How about your two cousins, what did they do?
PROSECUTOR ORILLO: A My cousins also told him not to do it because they said they [were] the only persons [t]here and for sure
we will be implicated.
Q What did you do after you were called by this Tolentino?
Q And thereafter, what happened next?
A So I went with him to their house.
A Tolentino said he will just take care.
Q Where is his house?
Q So what happened next after that?
A Just beside our house or near our house.
A And then Tolentino asked Melwin Ledesma to get the bolo of my stepfather in our house.
COURT:
Q And what did your cousin Melwin Ledesma do after he was ordered by Tolentino to get the bolo?
Q Where was Tolentino when he called you to go with him?
A Then Melwin Ledesma went to the house and got the bolo and brought the same to the house of
A He was by the door of our house although he was still outside but he was at the door of our house when
Tolentino.
he called me.
Q And after bringing the bolo to the house of Tolentino, what happened next?
COURT:
A Then when my step-father was on his way to our house, Tolentino told us to go home. [25]
Continue.
Q What happened next after you sa id your step-father went out to buy ovaltine?
PROSECUTOR ORILLO:
A Then several minutes thereafter my stepfather again arrived in our house then he got inside the house
Q And you said you went with him to his house, now what happened there in his house?
and he went directly to the kitchen.
A There in their house he told me just to keep quiet because he [was] going to kill my step-father.
Q And what did your step-father do?
Q And what did you do next after he told you about that?
A After that he transferred the rice he brought which was placed on a plastic cellophane to another plastic
A After he told me that I cried and I told him not to do that because we will be implicated. container.

Q What else did you do aside from crying and telling him not to do it because we will be implicated,what Q And what else happened?
else did you do?
 15

A And then after that Tolentino entered our house and went directly to the kitchen and there he hitmy PROSECUTOR ORILLO:
step-father.
Q When you saw Tolentino hit your step-father, where was your step-father facing?
Q And what instrument did Tolentino use in hitting your step-father?
A He was facing forward while Tolentino came from behind him.
A A piece of wood.
Q And what happened next after your step-father was hit by that piece of wood used by Tolentino?
Q Will you please describe this piece of wood?
A After he was hit he fell [face] down x x x, he fell down first on the table and after that to the ground. From
A A round piece of wood. the table he continued to fall to the ground.

Q How about the length of this piece of wood? Q And while your step-father was already on the ground, what if any did Tolentino do?

A (Witness extended her both hands to demonstrate the length which when measured gave us twenty A Then when my step-father was already atthe cementedpavement Tolentinosteppedon his head several
inches in length). times.

Q You said it was a round piece of wood, can you more or less tell us the diameter of this piece of wood? Q And then what happened next?

A (Witness again made a circle to demonstrate the diameter which [was] three and a half inches x x x).
PROSECUTOR ORILLO:
Q And where was your step-father hit by that piece of wood used by Tolentino?
A He was hit on the right side of his neck x x x extending to his right jaw.
Q Will you please tell this Honorable Court your particular position when you saw Tolentino hit withthe
piece of wood your step-father?
A I was in a sitting position in the sala but you know in our house even if you are seated in the sala you can
see the kitchen from there.
A After that I cried but he told me to keep quiet because if I [was] not going to keep quiet he will also kill
us.
Q After that, what happened?
A And then he asked my cousins to help him to bring the body of my step-father outside of the house.
Q And then?
A Then they brought my step-father outside of the house and Tolentino held him on the collar of his shirt
and my cousins held him on his feet.
Q And while already outside the house, towards what direction did they bring your step -father?

Q Before you saw that, where did Tolentino come from? ATTY. JIMENEZ:

ATTY. JIMENEZ: Witness is incompetent, we object, Your Honor.

Witness is incompetent, Your Honor. COURT:

PROSECUTOR ORILLO: Sustained.

If she knows, Your Honor. PROSECUTOR ORILLO:

ATTY. JIMENEZ: Q What else happened after you saw your cousins Jonathan Fabros and Tolentino carrying your step-
father?
She was seated in the sala, how can [she] know?
ATTY. FABIAN:
COURT:
Objection, Your Honor, there was no mention of any Jonathan Fabros in her testimony.
According to her she went home and she was in the sala. If she went to the sala, probably she will know. If
she knows she may answer. COURT:

A I did not know where he came from but I just saw him getting inside our house and [going] directly to Cousin only.
the kitchen.
ATTY. FABIAN:
 16

Yes, Your Honor, cousin only, no mention of Jonathan Fabros. A Well, since it was clear from our house although I stayed inside our house and since the walling of our
house, the portion of this is made of screen, I saw Tolentino when they were carrying my step-father in
COURT: the act of stabbing my step-father (witness demonstrated as if she was holding something and thrust[ing
it] forward).
I do not know if it was cousin or cousins.
Q What else did you see?
ATTY. JIMENEZ:
A And then after that, I only saw Tolentino [place] the body of my step-father on the water and there I did
I heard cousins, Your Honor.
not see my cousin anymore.
COURT:
Q And then what transpired next?
Cousins, with S. She may answer. Yes, according to her it was only her cousins who were with her.
A Then a few minutes thereafter my cousin returned to the house.
ATTY. FABIAN:
Q And what did you do when your cousin returned to the house?
I heard the name Jonathan Fabros being mentioned by the prosecution, Your Honor.
A And then when he arrived home I just cried and I told him, because his nickname is Nonong, so I said:
COURT: Nonong, we will be really implicated and he said nothing and instead he just went to his previous position
and sat down.
That is why I told the prosecutor to change it to cousins.
Q How about the other cousin of yours Melwin Ledesma, where was he?
ATTY. FABIAN:
A He was also beside me and he was embracing me from behind.
Yes, Your Honor.
Q What happened next?
A It was only Jonathan and Tolentino who carried him.
A Then another few minutes after, Tolentino arrived in our house.
Q So what happened next after you saw them carrying your step-father?
Q And when he arrived at your house, what did he do?
A They brought my step-father to the creek.
A And then there inside our house he flashed a thumbs up and he said it is already okey.
Q How far is this sapa or creek from your house?
Q What else did he do?
A Maybe from here (witness again by the use of the witness stand as reference point, pointed to the fourth
bench from the front,) about 6.5 meters, because from the witness stand to the main door is measured A Then he approached me and told me not to report [t]his incident because if I [was] going to report [it]
7.5 meters, so if it is from here, it is only 6.5 meters. he [was] going to kill me.

ATTY. JIMENEZ: Q And that particular time when he arrived at your house, what if any did you notice from his person,this
Tolentino?
That is about 7 to 8 meters.
ATTY. JIMENEZ:
COURT:
Leading, Your Honor.
That is about 7 meters already from the witness stand to the fourth bench, more or less 7 meters.
COURT:
PROSECUTOR ORILLO:
Sustained.
Q This sapa or creek that you are referring to, please describe to this Honorable Court this creek which
according to you is only 7 meters more or less away from your house? PROSECUTOR ORILLO:

A This is a wide creek. What if any have you noticed from Tolentino?

Q And what else did you see? COURT:


Will you please be more specific with your question.
PROSECUTOR ORILLO:
At the time when Tolentino arrived at your house and told you okey na, with thumbs up, that particular
time, what if any have you noticed on his person?
ATTY. JIMENEZ:
It is [a] very general question, Your Honor.
COURT:
Anything she noticed, she may answer.
A I noticed that his shortpants was wet and there [were] bloodstains on his shirt. [26]
The above testimony shows that Tolentino attacked Hernan Sagario. The assault was carried out without
the participation of appellant, [27] who did not personally hit or stab the victim, but only subsequently
helped carry the latter from the house to the nearby creek.[28] Nothing in the testimony conveyed a
coordinated action, concerted purpose or community of design to commit the criminal act. [29] It must be
emphasized that Tolentinos plan to kill the victim was concocted in the absence of appellant.[30]The latters
participation, as shown by the foregoing testimony, was made when the decision to kill was already a fait
accompli.[31]
Further, conspiracy cannot be inferred from the overt acts of appellant. [32] He did nothing to assist
Tolentino in the actual commission of the murder. [33] Neither did the former bear any weapon, much less
use one to inflict injury on the victim. [34] In fact, appellant, showing clearly his lack of support for the
criminal intent of Tolentino, even tried to prevent the latter from hacking the victim, according to the
eyewitness. [35]
Indeed, the trial court based its finding of conspiracy on mere presumptions, not on solid facts indubitably
indicating a common design to commit murder. [36] Such suppositions do not constitute proof beyond
reasonable doubt. [37]
Because of the lack of a united purpose, appellant cannot be considered a principal by indispensable
cooperation.[38] Absent a conspiracy, his responsibility, as well as that of his co-accused, is individual -- not
collective -- and each is to be punished only for his own separate acts. [39]
Not an Accomplice
Neither can appellant be convicted as an accomplice. Article 18 of the Revised Penal Code defines
accomplices as those persons who, not being included in Article 17,[40] cooperate in the execution of the
offense by previous or simultaneous acts. To be convictedas an accomplice, it is necessary that the accused
be aware of the criminal intent of the principal and then cooperate knowingly or intentionally by supplying
material or moral aid for the efficacious execution of the crime. [41]
To consider a person an accomplice in the commission of the offense, the following must concur: (1)
community of design -- knowing the criminal design of the principal by direct participation, one concurs
therein; (b) cooperation in the execution of the offense by previou s or simultaneous acts, with the
intention of supplying material and moral aid in the execution of the crime in an efficacious way; and (c) a
17
relation between the acts done by the principal and those attributed to the person charged as
accomplice. [42]
To be deemed an accomplice, one needs to have had both knowledge of and participation in the criminal
act.[43] In other words, the principal and the accomplice must have acted in conjunction and directed their
efforts to the same end. [44] Thus, it is essential that both were united in their criminal design. [45]
In the case before us, appellant did not concur in or lend supp ort to the nefarious intent of
Tolentino. [46] The mere fact that the former had prior knowledge of the latters criminal design did not
automatically make him an accomplice.[47] This circumstance, by itself, did not show his concurrence in the
principals criminal intent. [48]
That appellant helped Tolentino carry the victim from the house to the creek did not necessarily
demonstrate concurrence of wills or unity of purpose or action. [49]Quite the contrary, the formers attempt
to dissuade the latter from killing Sagario was attested to by the prosecution witness. [50] With the nominal
role appellant played in the drama that had been thrust upon him, we cannot declare that he was an
accomplice in the crime charged. [51]
Not an Accessory Either
Appellant cannot be convicted as an accessory either. Article 19 of the Revised Penal Code defines an
accessory as one who had knowledge of the commission of the crime and did not participate in its
commission as principal or accomplice, yet took part subsequent to its commission by any of three
modes: (1) profiting oneself or assisting the offender to profit by the effects of the crime; (2) concealing or
destroying the body of the crime, or the effects or instruments thereof, in order to prevent its discovery;
and (3) harboring, concealing, or assisting in the escape of the principals of the crime, provided the
accessory acts with abuse of his public functions or when the offender is guilty of tr eason, parricide,
murder, or an attempt to take the life of the Chief Executive, or is known to be habitually guilty of some
other crime. To convict an accused as an accessory, the following elements must be proven: (1) knowledge
of the commission of the crime and (2) subsequent participation in it by any of the three above-cited
modes. [52]
Under paragraph 2 of said codal provision, the concealment or the destruction of the body of the crime or
of the effects or the instruments thereof must have been done in order to prevent the discovery of the
crime.[53] That, precisely, is wanting in the present case. [54]
In his testimony,[55] appellant stated that because he was afraid his co-accused would hurt him if he
refused, he agreed to assist the latter in carrying the victim towards the river. The fact that appellantleft
thereafter likewise indicated his innocence of the charge.[56] Verily, he adequately explained his conduct
prior to the stabbing incident as one born of fear for his own life. [57] It is not incredible for an eyewitness
to a crime, especially if unarmed, to desist from assisting the victim if to do so would put the formers life
in peril. [58]
Thus, in People v. Verzola, [59] we explained as follows:
x x x. It must be noted that Josefina testified that she helped her co-appellant bring the body of the
deceased down the stairs because of fear. Even if she assisted her co-appellant without duress, simply
assisting Verzola in bringing the body down the house to the foot of the stairs and leaving said body for
anyone to see, cannot be classified as an attempt to conceal or destroy the body of the crime, the effects
or instruments thereof, must be done to prevent the discovery of the crime. [60]

The presumption of innocence in favor of appellant has not been overcome by proof beyond reasonable
doubt. [61] Thus, he must be acquitted. [62]
WHEREFORE, the appeal is GRANTED and the assailed Decision SET ASIDE. Appellant is ACQUITTED on
reasonable doubt. He is ordered RELEASED from custody immediately, unless legally held for another
cause. In this regard, the director of the Bureau of Corrections is directed to report to this Court his
compliance with this Decision within five (5) days from receipt here of.
SO ORDERED.
Merhcan v. Mendoza
G.R. No. L-24471, August 30, 1968
Fernando, J.
FACTS:
Respondents Arsenio Mendoza, Leonarda Ilaya and Zenaida Mendoza boarded a bus owned and
operated by Philippine Rabbit Bus Lines driven by Silverio Marchan. While tra velling on its way to Manila,
it fell into a ditch causing the passengers inside the bus to be thrown out to the ground resulting in their
multiple injuries. Thereafter, Marchan was convicted for serious, less serious and slight physical injuries
through reckless imprudence.
As such, respondents filed to recover damages from herein petitioners. Petitioners, on the other hand,
contends there is can be no implied contract of carriage between them and the passengers, hence, there
can be no basis for the recovery of damages from breach of contract.
ISSUE:
Whether or not there is a contract of carriage between the bus company and the passengers and
consequently, whether or not Article 1759 is applicable in the present case.
HELD:
YES, there is a contract of carriage between the parties and Article 1759 is applicable in the case at bar.
Respondents were waiting for a passenger bus and the moment they boarded the bus being driven by
Marchan, they were treated as passengers thereto, for they paid their corresponding fees. The riding
public is not expected to inquire from time to time before hey board the passenger bus whether or not
the driver who is at the steering wheel of said bus was authorized to drive said vehicle or that said driver
is acting within the scope of his authority and observing the existing rules and regulations required of
him by the management.
Common carriers cannot escape liability “for the death of or injuries to passengers through the
negligence and willful acts of the former’s employees, although such employees may have acted beyond
the scope of their authority or in violation of orders”. Clearly, the applicability of Article 1759 is
indisputable.
18
RCPI VS CA
143 SCRA 657 – Civil Law – Torts and Damages – Human Relations – Article 19 and 20 of the Civil Code –
Negligence
Loreto Dionela received a telegram via the Radio Communications of the Philippines, Inc. (RCPI).
However, at the end of the telegram were the following:
SA IYO WALANG PAKINABANG DUMATING KA DIYAN WALA KANG PADALA DITO KAHIT BULBUL MO
The said portion of the telegram was not intended for Loreto. Loreto sued RCPI for damages based on
Article 19 and 20 of the Civil Code which provides:
ART. 19.- Every person must, in the exercise of his rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty and good faith.
ART. 20.-Every person who, contrary to law, wilfully or negligently causes damage to another, shall
indemnify the latter for the same.
In its defense, RCPI averred that there was no intention to malign Loreto and that the attached message
was an insider joke between RCPI employees which was not meant to be attached. RCPI also disclaimed
liability as it insisted it should be held liable for the libelous acts of its employees.
Loreto however averred that the said message was read by his employees and it affected greatly his
business reputation. The trial court ruled in favor of Loreto. The Court of Appeals affirmed the trial court.
ISSUE: Whether or not the Court of Appeals erred in holding that the liability of RCPI is predicated under
Article 19 and 20 of the Civil Code.
HELD: No. The Supreme Court affirmed the judgment of the appellate court. The cause of action of
private respondent is based on Articles 19 and 20 of the new Civil Code as well as respondent’s breach of
contract thru negligence of its own employees. RCPI is not being sued for its subsidiary liability.
RCPI was negligent as it failed to take the necessary or precautionary steps to avoid the occurrence of
the humiliating incident now complained of. The company had not imposed any safeguard against such
eventualities and this void in its operating procedure does not speak well of its concern for their
clientele’s interests. Negligence here is very patent. This negligence is imputable to appellant and not to
its employees. RCPI should be held liable for the acts of its employees. As a corporation, RCPI acts and
conducts its business through its employees. It cannot now disclaim liability for the acts of its
employees. To hold that the RCPI is not liable directly for the acts of its employees in the pursuit of its
business is to deprive the general public availing of the services of RCPI of an effective and adequate
remedy.
 19

ELMAR O. PEREZ, Petitioner,

vs.
COURT OF APPEALS, Fifth Division, TRISTAN A. CATINDIG and LILY GOMEZ-CATINDIG, Respondents.

FACTS:

Private respondent Tristan A. Catindig married Lily Gomez Catindig twice on May 16, 1968. The marriage
produced four children. Several years later, the couple encountered marital problems that they decided
to obtain a divorce from the Dominican Republic. Thus, on April 27, 1984, Tristan and Lily executed a
Special Power of Attorney addressed to the Judge of the First Civil Court of San Cristobal, Dominican
Republic, appointing an attorney-in-fact to institute a divorce action under its laws.

On July 14, 1984, Tristan married petitioner Elmar O. Perez in the State of Virginia in the United States and
both lived as husband and wife until October 2001. Their union produ ced one offspring.

During their cohabitation, petitioner learned that the divorce decree issued by the court in the Dominican
Republic which "dissolved" the marriage between Tristan and Lily was not recognized in the Philippines
and that her marriage to Tristan was deemed void under Philippine law. On August 13, 2001, Tristan filed
a petition for the declaration of nullity of his marriage to Lily with the RTC of Quezon City.

ISSUE:

Whether or not Perez has a legal interest in the matter of litigation required of a would-be intervenor in
Tristan’s petition for declaration of nullity of his marriage with his wife?

RULING:

No, Perez has no legal interest. When petitioner and Tristan married on July 14, 1984, Tristan was still
lawfully married to Lily. The divorce decree that Tristan and Lily obtained from the Dominican Republic
never dissolved the marriage bond between them. It is basic that laws relating to family rights and duties,
or to the status, condition and legal capacity of persons are binding upon citizens of the Philippines, even
though living abroad. Regardless of where a citizen of the Philippines might be, he or she will be governed
by Philippine laws with respect to his or her family rights and duties, or to his or her status, condition and
legal capacity. Hence, if a Filipino regardless of whether he or she was married here or abroad initiates a
petition abroad to obtain an absolute divorce from spouse and eventually becomes successful in getting
an absolute divorce decree, the Philippines will not recognize such absolute divorce. Petitioner’s claim that
she is the wife of Tristan even if their marriage was celebrated abroad lacks merit. Thus, petitionernever
acquired the legal interest as a wife upon which her motion for intervention is based.

[G.R. No. 127004. March 11, 1999]
NATIONAL STEEL CORPORATION, petitioner, vs. THE REGIONAL TRIAL COURT OF LANAO DEL NORTE,
BRANCH 2, ILIGAN CITY and E. WILLKOM ENTERPRISES, INC., respondents.
D E C I S I ON
PURISIMA, J.:
Before the Court is a Petition for Certiorari with Prayer for Preliminary Injunction & Temporary Restraining
Order under Rule 65 of the Revised Rules of Court assailing the decision of the Regional Trial Court of Lanao
del Norte, Branch 2, Iligan City, on the following consolidated cas es :
(a) Special Proceeding Case No. 2206 entitled National Steel Corporation vs E. Willkom Enterprise Inc to
Vacate Arbitrators Award; and;
(b) Civil Case No. 2198 entitled to E. Willkom Enterprises Inc. vs National Steel Corporation for Sum of
Money with application for Confirmation of Arbitrators Award.
The facts as found below are, as follows:
"xxx On Nov. 18, 1992, petitioner-defendant Edward Wilkom Enterprises Inc. (EWEI for brevity) together
with one Ramiro Construction and respondent-petitioner National Steel Corporation (NSC for short)
executed a contract whereby the former jointly undertook the Contract for Site Development (Exhs. "3" &
"D") for the latter's Integrated Iron and Steel Mills Complex to be established at Iligan City.
Sometime in the year 1983, the services of Ramiro Construction was terminated and on March 7, 1983,
petitioner-defendant EWEI took over Ramiro's contractual obligation. Due to this and to other causes
deemed sufficient by EWEI, extensions of time for the termination of the project, initially agreed to be
finished on July 17, 1983, were granted by NSC.
Differences later arose, Plaintiff-defendant EWEI filed Civil Case No. 1615 before the Regional Trial Court
of Lanao del Norte, Branch 06, (Exhs. "A" and "1") praying essentially for the payments of P458,381.001
with interest from the time of delay; the price adjustment as provided by PD 1594;and exemplary damages
in the amount ofP50,000.00 and attorney's fees.
Defendant-petitioner NSC filed an answer with counterclaim to plaintiff's complaints on May 18, 1990.
On August 21, 1990, the Honorable Court through Presiding Judge Valario M. Salazar upon joint motionof
both parties had issued an order (Exhs. "C" and "3") dismissing the said complaint and counterclaim x x x
in view of the desire of both parties to implement Sec. 19 of the contract, providing for a resolution of any
conflict by arbitration x x x . ( underscoring supplied).
In accordance with the aforesaid order, and pursuant to Sec. 19 of the Contract for Site Development (id)
the herein parties constituted an Arbitration Board composed of the following:
(a) Engr. Pafnucio M. Mejia as Chairman, who was nominated by the two arbitrators earlier nominated by
EWEI and NSC with an Oath of Office (Exh. "E");
(b) Engr. Eutaquio 0. Lagapa, Jr., member, who was nominated by EWEI with an oath office (Exh. "F")
(c) Engr. Gil A. Aberilia, a member who was nominated by NSC, with an Oath of Office (Exh. "G").
20
After series of hearings, the Arbitrators rendered the decision (Exh. "H" & "4") which is the subjectmatter
of these present causes of action, both initiated separately by the herein contending parties, substantial
portion of which directs NSC to pay EWEI, as follows:
(a) P458,381.00 representing EWEI's last billing No. 16 with interest thereon at the rate of 1-1/4% per
month from January 1, 1985 to actual date of payment;
(b) P1,335,514.20 representing price escalation adjustment under PD No. 1594, with interest thereon at
the rate of 1-1/4 % per month from January 1, 1985 to actual date of payment;
(c) P50,000 as and for exemplary damages;
(d) P350,000 as and for attorney's fees.; and
(e) P35,000.00 as and for cost of arbitration."[1]
The Regional Trial Courtof Lanao del Norte Branch 2, Iligan Citythrough Judge MaximoB. Ratunil, rendered
judgment as follows:
(1) In Civil Case No. 11-2198, declaring the award of the Board of Arbitrators, dated April 21, 1992 to be
duly AFFIRMED and CONFIRMED "en toto" ; that an entry of judgment be entered therewith pursuant to
Republic Act No. 876 (the Arbitration Law); and costs against respondent National Steel Corporation.
(2) In Special Proceeding No. 11-2206, ordering the petition to vacate the aforesaid award be DISMISSED.
SO ORDERED.[2] "
With the denial on October 18, 1996 of its Motion for Reconsideration, the National Steel Corporation
(NSC) has come to this court via the present petition.
After deliberating on the petition as well as the comment and reply thereon, the court gave due course to
the petition and considered the case ripe for decision.
The pivot of inquiry here is whether or not the lower court acted with grave abuse of discretion in not
vacating the arbitrator's award.
A stipulation to refer all future disputes or to submit an ongoing dispute to an arbitrator is valid. Republic
Act 876, otherwise known as the Arbitration Law, was enacted by Congress since there was a growing need
for a law regulating arbitration in general.
The parties in the present case, upon entering into a Contract for Site Development, mutually agreedthat
any dispute arising from the said contract shall be submitted for arbitration. Explicit is Paragraph 19 of
subject contract, which reads:
"Paragraph 19. ARBITRATION. All disputes questions or differences which may at any time arise between
the parties hereto in connection with or relating to this Agreement or the subject matter hereof, including
questions of interpretation or construction, shall be referred to an Arbitration Board composed of three
(3) arbitrators, one to be appointed by each party, and the third, to be appointed by the two (2)
arbitrators. The appointment of arbitrators and procedure for arbitration shall be governed by the
provisions of the Arbitration Law (Republic Act No. 876). The Board shall apply Philippine Law in
adjudicating the dispute. The decision of a majority of the members of the Arbitration Board shall be valid,

binding, final and conclusive upon the parties, and from which there will be no appeal, subject to the
provisions on vacating, modifying, or correcting an award under the said Republic Act No. 876. [3]
Thereunder, if a dispute should arise from the contract, the Arbitration Board shall assume jurisdiction and
conduct hearings. After the Board comes up with a decision, the parties may immediately implement the
same by treating it as an amicable settlement. However, if one of the parties refuses to comply or is
dissatisfied with the decision, he may file a Petition to Vacate the Arbitrator's decision before the trial
court. On the other hand, the winning party may ask the trial court's confirmation to have such decision
enforced.
It should be stressed that voluntary arbitrators, by the nature of their functions, act in a quasi -judicial
capacity.[4] As a rule, findings of facts by quasi-judicial bodies, which have acquired expertise because their
jurisdiction is confined to specific matters, are accorded not only respect but even finality if they are
supported by substantial evidence,[5] even if not overwhelming or preponderant. [6] As the petitioner has
availed of Rule 65, the Court will not review the facts found nor even of the law as interpreted or applied
by the arbitrator unless the supposed errors of facts or of law are so patent and gross and prejudicial as to
amount to a grave abuse of discretion or anexcess de pouvoir on the part of the arbitrators. [7]
Thus, in a Petition to Vacate Arbitrator's Decision before the trial court, regularity in the performance of
official functions is presumed and the complaining party has the burden of proving the existence of anyof
the grounds for vacating the award, as provided for by Sections 24 of the Arbitration Law, to wit:
"Sec. 24 GROUNDS FOR VACATING THE AWARD - In any one of the following cases, the court mustmake
an order vacating the award upon the petition of any party to the controversy when such party proves
affirmatively that in the arbitration proceedings:
(a) The award was procured by corruption, fraud or other undue means;
(b) That there was evident partiality or corruption in the arbitrators of any of them; or
(c) That the arbitrators were guilty of misconduct in refusing to postpone the hearing upon sufficient cause
shown, or in refusing to hear evidence pertinent and material to the controversy; that one or more of the
arbitrators was disqualified to act as such under section nine hereof, and wilfully refrained from disclosing
such disqualification or of any other misbehavior by which the rights of any party have been materially
prejudiced; or
(d) That the arbitrators exceeded their powers, or so imperfectly executed them, that a mutual, final and
definite award upon the subject matter submitted to them was not made. xxx"
The grounds relied upon by the petitioner were the following (a) That there was evident partialityin the
assailed decision of the Arbitrators in favor of the respondent; and (b) That there was mistaken
appreciation of the facts and application of the law by the Arbitrators. These were the very same grounds
alleged by NSC before the trial court in their Petition to Vacate the Arbitration Award and which petitioner
is reiterating in this petition under scrutiny.
Petitioner's allegation that there was evident partiality is untenable. It is anemic of evidentiary support.
In the case of Adamson vs. Court of Appeals, 232 SCRA 602, in upholding the decision of the Board of
Arbitrators, this Court ruled that the fact that a party was disadvantaged by the decision of the Arbitration
Committee does not prove evident partiality. Proofs other than mere inference are needed to establish
evident partiality.Here, petitioner merely averred evident partiality without any proof to back it
21
up. Petitioner was never deprived of the right to present evidence nor was there any showing that the
Board showed signs of any bias in favor of EWEI. As correctly found by the trial court:
"Thirdly, this Court cannot find its way to support NSC's contention that there was evident partiality in the
assailed Award of the Arbitrator in favor of the respondent because the conclusion of the Board, which
the Court found to be well-founded, is fully supported by substantial evidence, as follows:
"xxx The testimonies of witnesses from both parties were heard to clarify facts and to threash (sic) out the
dispute in the hearings. Upon motion by NSC counsel, the hearing of testimony from witnesses was
terminated on 22 January 1992. To end the testimonies in the hearing both litigant parties upon query by
Arbitrator-Chairman freely declared that there has been no partiality in the manner the Arbitrators
conducted the hearing, that there has been no instance, where Arbitrators refused to postpone requested
or to hear/accept evidence pertinent and material to the dispute. xxx (underscoring supplied)
Parentethically, and in the light of the record above-mentioned, this Court hereby holds that the Boardof
Arbitrators did not commit any 'evident partiality' imputed by petitioner NSC. Above all, this Court must
sustain the said decision for it is a well settled rule that the actual findings of an administrative body should
be affirmed if there is substantial evidence to support them and the conclusions stated in the decision are
not clearly against the law and jurisprudence similar to the instant case. Henceforth, every reasonable
intendment will be indulged to give effect such proceedings and in favor of the regulatory and integrityof
the arbitrators act. (Corpus Juris, Vol. 5, p. 20)"[8]
Indeed, the allegation of evident partiality is not well-taken because the petitioner failed to substantiate
the same.
Anent the issue of mistaken appreciation of facts and law of the case, the petitioner theorizes that the
awards made by the Board were unsubstantiated and the same were a plain misapplication of the law and
even contrary to jurisprudence. To have a clearer understanding of the petition, this Court will try to
discuss individually the awards made by the Board, and determine if there was grave abuse of discretion
on the part of the trial court when it adopted such awards in toto.
I. P458,381.00 representing EWEI's last billing No. 16 with interest thereon at the rate of 1 1/4% per month from January 1, 1985 to actual date of payment;
Petitioner seeks to bar payment of the said amount to EWEI. Since the latter failed to complete the works
as agreed upon, NSC had the right to withhold such amount.The same will be used to cover the cost
differential paid to another contractor who finished the work allegedly left uncompleted by EWEI. Said
work cost NSC P1,225,000, and should be made chargeable to EWEI's receivables on Final Billing No. 16
issued to NSC.
The query here therefore is whether there was failure on the part of EWEI to complete the work agreed
upon. This will determine whether Final Billing No. 16 can be made chargeable to the cost differential paid
by NSC to another contractor.
After a series of hearings, the Board of Arbitrators concluded that the work was completed by EWEI. As
correctly stated:
"To authenticate the extent of unfinished work, quantity, unit cost differential and amount, NSC was
required to submit copies of payment vouchers and/or job awards extended to the other contractor
engaged to complete the works. The best efforts by NSC despite the multiplicity of
accounting/auditing/engineering records required in a corporate complex failed to produce documentary
proofs from their Iligan or Makati office despite repeated requests. NSC failed to substantiate such allusion

of completion by another contractor three unfinished items of works, actual quantities accomplished and
unit cost differential paid chargeable against EWEI.
xxx xxx xxx
The latest evaluation on record of the items of work completed by EWEI under the contract is drawn from
the NSC report (Exhibit "11-d") dated 12 November 1985 submitted with the EWEI Billing No. 16-Final in
the course of processing claim on items of work accomplished. There is no such report or mention of
unfinished work of 90,000 MT of dumped riprap, 100,000 cu. m. of site grading and 300,000 cu. m. of
spreading common excavated materials in the EWEI contract alluded to by the NSC as unfinished work
otherwise EWEI Billing No. 16-Final would not have passed processing for payment unless there is really
no such unfinished work NSC evaluation report with no adverse findings of unfinished work considerthe
contract as completed.
To affirm the work items, quantity, unit cost differential and amount of unfinished work left behind by
EWEI, NSC in serving notice of contract termination to EWEI should have instead specifically cited these
obligations in detail for EWEI to perform/comply within 30 days, such failure to perform/com ply should
have constituted as an event in default that would have justified termination of contract of NSC with
EWEI. If at all, this unfinished work may be additional/extra work awarded in 1984 to another contractor
at prices higher than the unit price tendered by EWEI in 1982 and/or the discrepancy between actual
quantities of work accomplished per plans versus estimated quantities of work covered by separate
contract as expansion of the original project."
xxx xxx xxx
IN VIEW OF THE FOREGOING, THE SO-CALLED UNFINISHED WORKS IN THE CONTRACT BY EWEI ALLUDED
TO BY NSC IS NOT CONSIDERED AN OBLIGATION TO PERFORM/COMPLY THUS ABSOLVING EWEI OF ANY
FAILURE TO PERFORM/COMPLY AND THEREFORE CANNOT BE AVAILED OF AS A RIGHT OR REMEDY BY NSC
TO RECOVER UNIT DIFFERENTIAL COST FROM EWEI FOR THE SAME UNSUBSTANTIATED WORK DONE BY
ANOTHER CONTRACTOR." (ANNEX "C" ARBITRATION, page 86-88 of Rollo.)
Furthermore, under the contract sued upon, it is clear that should the Owner feel that the work agreed
upon was not completed by the contractor, it is incumbent upon the OWNER to send to CONTRACTOR a
letter within seven (7) days after completion of the inspection to specify the objections thereto[9] NSC
failed to comply with such requirement, and therefore it would be unfair to refuse payment to EWEI,
considering that the latter had faithfully submitted Final Billing No.16 believing that its work had been
completed because NSC did not call its attention to any objectionable aspect of their project.
But, what cannot be upheld is the Board's imposition of a 1-1/4% interest per month from January 1, 1985
to actual date of payment. There is nothing in the said contract to justify or authorize such an award. The
trial court should have therefore disregarded the same and instead, applied the legal rate of 6% per
annum, from Jan. 1, 1985 until this decision becomes final and executory. This is so because the legal rate
of interest on monetary obligations not arising from loans or forebearance of credits or goods is 6%[10] per
annum in the absence of any stipulation to the contrary.
(II) Price escalation with the interest rate of 1-1/4% per month from 1 January 1985 to actual date of payment.
Petitioner contends that EWEI is not entitled to price escalation absent any stipulation to that effect in the
contract under which, the contract price is fixed, citing Paragraph 2 thereof, which stipulates:
2. CONTRACT PRICE -
22
xxx xxx
The applicable unit prices above fixed are based on the assumption that the disposal areas for cleared,
grubbed materials,debris, excess filling materials and other matters that are to be disposed of or are within
the boundary limits of the site, as designated in Annex A hereof. In the event that disposal areas fixed and
designated in Annex A are diverted and transferred to such other areas as would be outside the limits of
the site as would require additional costs to the contractor, then Owner shall be liable for such additional
hauling costs of P1.45/km/m3." (Annex "A", Contract for Site Development, page 55 of Rollo)
The phrase "prices above fixed" means that the contract price of the work shall be that agreed upon by
the parties at the time of the execution of the contract, which is the law between them provided it is not
contrary to law, morals, good customs, public order, or public policy. (Article 1306, New Civil Code). It
cannot be inferred therefrom, however, that the parties are prohibited from imposing future increases or
price escalation. It is a cardinal rule in the interpretation of contracts that "if the terms of a contract are
clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its
stipulations shall control."[11]
But price escalation is expressly allowed under Presidential Decree 1594, which law allows price escalation
in all contracts involving government projects including contracts entered into by government entities and
instrumentalities and Government Owned or Controlled Corporations (GOCCs). It is a basic rule in
contracts that the law is deemed written into the contract between the parties. And when there is no
prohibitory clause on price escalation, the Court will allow payment therefor. Thus, petitioner cannot rely
on the case of Llama Development Corporation vs. Court of Appeals and National Steel Corporation, GR
88093, Resolution, Third Division, 20 Sept 1989. It is not applicable here since in that case, the
contract explicitly provided that the contract price stipulated was fixed, inclusive of all costs and not
subject to escalation, (emphasis supplied). This, in effect, waived the provisions of PD 1594. The case
under scrutiny is different as the disputed contract does not contain a similar provision.
In a vain attempt to evade said law's application, they would like the Court to believe that it is an acquired
asset corporation and not a government owned or controlled corporation so that they are not within the
coverage of PD 1594. Whether NSC is an asset-acquired corporation or a government owned or controlled
corporation is of no moment. It is not determinative of the pivot of inquiry. It bears emphasizing that
during the hearings conducted by the Board of Arbitrators, there was presented documentary evidence to
show that NSC, despite its being allegedly an asset acquired corporation, allowed price escalation to
another contractor, Geo Transport and Construction, Inc. (GTCI). As said in the decision of the Board of
Arbitrators:
"On the other hand, there was documentary evidence presented that NSC granted Geo Transport and
Construction, Inc. (GTCI), the other favored contractor working side by side with EWEI on the site
development project during the same period the GTCE was granted upon request and paid by NSC an
actual sum of P6.9 million as price adjustment compensation even without the benefit of escalation
provision in the contract but allowed in accordance with PD NO. 1594 enforceable among government
controlled or owned corporation. The statement is embodied in an affidavit (Exhibit "111-h") submitted
by affiant Jose M. Mesina, Asst. to the President and Legal Counsel of GTCI, submitted to the Arbitrators
upon solicitation of EWEI, copy to NSC, on 3 October 1991. NSC did not assail the affidavit upon receiptof
such document as evidence until the hearing of 19 December 1991 when the affidavit was branded by NSC
counsel as incorrect and hearsay. Within 7 days reglamentary period after receipt of affidavit in 3 October
1991, the NSC had the recourse to contest the affidavit even preferably charge the affiant for slander if
NSC could disprove the statements as untrue."[12]
 23

If Petitioner seeks to refute such evidence, it should have done so before the Board of Arbitrators, during
the hearings. To raise the issue now is futile.

However, the same line of reasoning with respect to the first award should be used in disregarding the
interest rate of 1-1/4%. The legal rate of 6% per annum should be similarly applied to the price escalation
to be computed from Jan. 1, 1985 until this decision becomes final and executory.

(III) The award of P50,000 as exemplary damages and P350,000 as attorney's fees;

The exemplary damages and attorneys fees awarded by the Board of Arbitrators should be deleted i nlight
of the circumstances surrounding the case.

The requirements for an award of exemplary damages, are: (1) they may be imposed by way of example
in addition to compensatory damages, and only after the claimants right to them has been established; (2)
that they cannot be recovered as a matter of right, their determination depending upon the amount of
compensatory damages that may be awarded to the claimant; (3) the act must be accompanied by bad
faith or done in a wanton, fraudulent, oppressive or malevolent manner. [13]

EWEI cannot claim that NSC acted in bad faith or in a wanton manner when it refused payment of the Final
Billing No. 16. The belief that the work was never completed by EWEI and that it (NSC) had the right to
make it chargeable to the cost differential paid by the latter to another contractor was neither wanton nor
done in evident bad faith. The payment of legal rate of interest will suffice to compensate EWEI of
whatever prejudice it suffered by reason of the delay caused by NSC.

As regards the award of attorney's fees, award for attorney's fees without justification is a "conclusion
without a premise, its basis being improperly left to speculation and conjencture.[14] The "fixed counsel's
fee" of P350,000 should be disallowed. The trial court acted with grave abuse of discretion when it
adopted the same in toto.

WHEREFORE, the awards made by the Board of Arbitrators which the trial court adopted in its decisionof
July 31,1996, are modified, thus:

(1) The award of P474,780.23 for Billing No. 16-Final and P1,335,514.20 for price adjustment shall be paid
with legal interest of six (6 %) percent per annum, from January 1, 1985 until this decision shall have
become final and executory;

(2) The award of P50,000 for exemplary damages and attorney's fees of P350,000 are deleted; and

(3) The cost of arbitration of P35,000 to supplement arbitration agreement has to be paid.

No pronouncement as to costs.

SO ORDERED.

G.R. No. L-5164 January 27, 1953
CONRADO V. SINGSON, CAROLINA CRISOSTOMO, and FLORENTINO DE LIMA, petitioner-appellant,
vs.
CRISANTO ARAGON and MIGUEL L. LORZA, respondent-appellees.
BAUTISTA ANGELO, J.:
This is a petition for certiorari filed in the Court of First Instance of Manila which seeks to set aside the
order of respondent Judge denying petitioner's motion to dismiss the complaint for damages filed inthe
Municipal Court, Branch IV, Manila, and prohibit him for further proceedings with the case on the ground
that the same is beyond its jurisdiction.
On January 24, 1951, Miguel L. Lorza filed in the complaint in the Municipal Cou rt of Manila against
Conrado V. Singson, Carolina Crisostomo and Florentino de Lima, petitioners herein, to recover the sum of
P1,321.80 as actual damages, and P500 as attorney's fees, and praying at the same time that he be
awarded such exemplary damages as the court may deem proper, plus the costs of the action. The
complaint was amended following a motion for bills of particulars filed by petitioners by itemizing the
claim for actual damages in the amount of P1,321.80. As no specification has been made with regards to
the exemplary damages prayed for, petitioner's moved for such specification, but the same was denied on
February 21, 1951, whereupon petitioners filed on the same date a motion to dismiss contending that the
court has no jurisdiction of the case because it involves a prayer for an unspecified amount of exemplary
damages which is beyond its limited jurisdiction. In a separate motion, petitioners also prayed that
plaintiff's counsel define his authority to appear by clarifying if plaintiffs is actually represented bythe law
firm of "Peralta & Agrava",he is merely utilizing said firmname to bolster up the claimof P500 as attorney's
fees mentioned in the complaint. The court denied both motions and so petitioners sued out the present
petition for certiorari.
The parties having submitted the case on the agreed statement of facts, the court rendered judgment
dismissing the petition, holding that "the plaintiff may waived totally or partially his claim for exemplary
damages, and in the case under consideration it must be taken for granted that the respondent Miguel L.
Lorza, as plaintiff in the Municipal Court, is waiving recovery of exemplary damages over and above the
amount which, if added to his claim for compensatory damages and attorney's fees, would bring the total
to more than two thousand pesos," which is the limit of jurisdiction of the municipal court. From the
decision petitioners have appealed.
The first error assigned by the appellants refers to the attitude of the lower court in ignoring their request
to have counsel of appellee clarify his stand as to his appearance which they believe to be important in
view of the amount of P500 which appelle is claiming in the complaint as attorney's fees to enable
appellants to determine if such claim is reasonable. We do not find any anomaly in this attitude of the
lower court it appearing from the record that during one of the hearings of the case before the Municipal
Court of Manila counsel for appelle made a verbal manifestation to the effect that he is the one of the
assistant attorneys of the law firm of "Peralta & Agrava" to whom the present case has been assigned and
as such he has full authority to appear and represent said law firm which is the attorney of record of the
appellee, and in the absence of any showing that this manifestation is not true, the same stands and
substantially satisfies the requirement of appellants for clarification.
The main purpose of the present action is to recover certain actual or compensatory damages plus certain
amount of attorney's fees, although in the prayer a request was made that the court assess the exemplary
damages to which plaintiff may be entitled as an additional relief, and because the amount of the
24
requested exemplary damages has not been specified it is now claimed that the case is beyond the
jurisdiction of the Municipal Court of Manila. The denial of the lower court to order of the specificationof
said damages in order to give the Municipal Court jurisdiction over the case is now assigned as err or.
The pertinent provision of the new Civil Code relative to exemplary damages are as follows:
ART. 2229. Exemplary or corrective damages are imposed, by way of example or correction of the public
good, in addition to moral, temperate, liquidated or compe nsatory damages.
ART. 2233. Exemplary damages cannot be recovered as a matter of right; the court will decide whether or
not they should be adjudicated.
ART. 2234. While the amount of the exemplary damages need not be proven, the plaintiff must showthat
he is entitled to moral, temperate or compensatory damages before the court may consider the question
of whether or not exemplary damages should be awarded. In case liquidated damages have been agreed
upon, although no proof of loss is necessary in order that such liquidated damages may be recovered,
nevertheless, before the court may consider the question of granting exemplary damages, the plaintiff
must show that he would be entitled to moral, temperate or compensatory damages were it not for the
stipulation for liquidated damages.
From the above legal provisions it appears that exemplary damages may be imposed by way of example
or correction only in addition, among others, to compensatory damages, but they could not be recovered
as a matter of right, their determination depending upon the discretion of the court. It further appears
that the amount of exemplary damages need not be proven, because its determination depends upon the
amount of compensatory damages that may be awarded to the claimant. If the amo unt of exemplary
damages need not be proven, it need not also be alleged, and the reason is obvious because it is merely
incidental or dependent upon what the court may award as compensatory damages. Unless and until this
premises is determined and established, what may be claimed as exemplary damages would amountto a
mere surmise or speculation. It follows as a necessary consequence that the amount of exemplary
damages need not be pleaded in the complaint because the same cannot be predetermined by the court
if in the cause of discretion the same is warranted by the evidence, and this is just what appellee has done.
The fact, however, that the amount of exemplary damages prayed for in the complaint has not been
specified does not necessarily mean that the case is beyond the jurisdiction of the Municipal Court of
Manila before which the case was filed by appellee before the Municipal Court which he is presumed to
know is of limited jurisdiction, it must be understood that he has done so with full knowledge that the
totality of his claim should not exceed the sum of P2,000. This is the limit of the Municipal Courts'
jurisdiction. And the law having placed this matter within discretion of the court, it must likewise be
understood that the court should act having due regards to its limited jurisdiction. In other words, if the
court should decide to award exemplary damages because it is warranted by the evidence, it can only do
so by awarding the plaintiff such amount as, in addition to the actual or compensatory damages, would
not exceed the limit of its jurisdiction. As the lower court has correctly said, the plaintiff may waived totally
or partially his claim for exemplary damages, and when he filed his case before the municipal court he is
presumed to have waived recovery of such amount as, if added to actual damages, would exceed the
amount of P2,000. We find correct the interpretation which the lower court has placed on the law on the
matter.
Finding no error in the decision appealed from, the same is hereby a ffirmed, with cost.

PHILIPPINE HAWK CORPORATION V. LEE
G.R. No. 166869 February 16, 2010
Facts: Respondent filed a case for Damages based on quasi delict arising from vehicular accident between
motorcycle and bus of Phil Hawk. Husband died, respondent su stained injuries. Before answer, an
amended complaint was filed, adding additional damages and reliefs. RTC ruled in favour of respondent.
The Court of Appeals added to the relief granted by the lower court. Phil Hawk filed Rule 45 Petition before
the Supreme Court, saying that respondent did not appeal to the ruling of the RTC and it was error onpart
of CA to grant damages.
Issue: whether or not the award of damages was proper.
Ruling: yes. There is no error in awarding additional reliefs. The petitioner is liable for damages because
as provided for under the Civil Code, whenever an employee’s negligence causes damage or injury to
another, there arises a presumption that the employer failed to exercise the due diligence of a good father
of the family in the selection or supervision of its employees. To avoid liability for a quasi-delict committed
by his employee, an employer must overcome the presumption by presenting convincing proof that he
exercised the care and diligence of a good father of a family in the selection and supervision of his
employee. The findings of the trial court and Court of Appeals were upheld that petitioner is liable because
the diligence of a good father of a family requirement in the selection and supervision of its bus driveris
not properly exercised.
G.R. No. L-62988 February 28, 1985
FELINA RODRIGUEZ-LUNA, JOSE R. LUNA and ROBERTO R. LUNA, JR., petitioners,
vs.
THE HON. INTERMEDIATE APPELLATE COURT, JOSE E. DELA ROSA and LUIS DELA ROSA, respondents.
Ezequiel S. Consulta for petitioners.
David M. Castro for respondents.
ABAD SANTOS, J.:
This is a petition to review a decision of the defunct Court of Appeals. The petitioners are the heirs of
Roberto R. Luna who was killed in a vehicular collision. The collision took place on January 18,1970, at the
go-kart practice area in Greenhills, San Juan, Metro Manila. Those involved were the go-kart driven by the
deceased, a business executive, and a Toyota car driven by Luis dela Rosa, a minor of 13 years who had no
driver's license.
In a suit for damages brought by the heirs of Roberto R. Luna against Luis dela Rosa and his father Jose
dela Rosa, the Court of First Instance of Manila in Civil Case No. 81078, rendered the following judgment:
WHEREFORE, judgment is hereby rendered sentencing the defendants Luis dela Rosa and Jose dela Rosa
to pay, jointly and severally, to the plaintiffs the sum of P1,650,000.00 as unearned net earnings of Roberto
Luna, P12,000.00 as compensatory damages, and P50,000.00 for the loss of his companionship, with legal
25
interest from the date of this decision; plus attorney's fees in the sum of P50,000.00, and the costs of suit.
(Record on Appeal, p. 35.)
The defendants appealed to the defunct Court of Appeals which in a decision dated May 22, 1979,
affirmed in toto that of the trial court. (Rollo, p. 48.) However, upon a motion for reconsideration filed by
the defendants-appellants, the Court of Appeals, in a resolution dated June 19, 1981, modified its
judgment thus:
WHEREFORE, the decision rendered in this case is hereby modified insofar as the judgment ordering the
defendants to pay, jointly and severally, the sum of P 1,650,000.00 to plaintiffs with legal interest from
July 5, 1973, is concerned. In lieu thereof, defendants are hereby ordered to pay plaintiffs, jointly and
severally, the sum of Four Hundred Fifty Thousand Pesos (P450,000.00) as unearned net earnings of
Roberto R. Luna, with legal interest thereon from the date of the filing of the complaint until the whole
amount shall have been totally paid.
The rest of the other dispositions in the judgment a quo stand. (Rollo, pp. 33 -34.)
Both parties filed separate petitions for review of the appellate court's decision.
In G.R. No. 57362, the petitionfor review of Jose andLuis dela Rosa was denied for lack of meriton October
5, 1981. Subsequently, they informed that the decision sought to be reviewed was not yet final because
the Lunas had a pending motion for reconsideration. For prematurity, this Court set aside all previous
resolutions. On February 16, 1983, acting upon the motion and manifestation of the petitioners, they were
required to file an amended petition within thirty days from notice. On June 20, 1983, this Court resolved:
"For failure of the petitioners to file an amended petition as required, this case is hereby DISMISSED and
the dismissal is final."
The instant case — G.R. No. 62988 — is the separate appeal of the Lunas. Their petition contains the
following prayer:
1. That the petition be given due course;
2. That after notice and hearing, judgment be rendered, setting aside or modifying the RESOLUTION of
respondent Court of Appeals dated June 19, 1981, attached as Annex "A" to the petition, only insofar as it
reduced the unearned net earnings to P450,000.00, s • as to affirm the trial court's finding as to the
unearned net earnings of the deceased in the amount of P1,650,000.00;
3. Ordering that the award of attorney's fees shall also be with interest, at the legal rate. (Rollo, p. 27.)
On June 27, 1983, the petition was given due course. (Rollo, pp. 122-123.)
In the light of the foregoing, the resolution stated:
It thus appears that the questions in esse are with respect to the award for unearned net earnings —
should the award be P450,000.00 only or should it be P1,650,000.00 as originally adjudged; and whether
the award for attorney's fees shall also be with interest at the legal rate.
The Court takes notice that the wrongful death occurred as early as January 18, 1970, and that until now
the process of litigation is not yet over. In the meantime the value of the Philippine peso has been seriously
eroded so that the heirs of the deceased may ultimately have a greatly depreciated judgment. In the
interest of justice, the private respondents are hereby ordered to PAY to the petitioners within thirty (30)

days from notice the following amounts adjudged against them: P450,000.00 for unearned net earnings
of the deceased; (P12,000.00 as compensatory damages; P50,000.00 for the loss of his companionship
with legal interest from July 3, 1973; and P50,000.00 as attorney's fees.
Still to be resolved shall be the following: whether the award for unearned net earnings shall be increased
to P1,650,000.00; and whether the award for attorney's fees shall also be with interest at the legal rate.
The costs will be adjudged as a matter of course. (Rollo, p. 123.)
The private respondents failed to pay the amounts and when required to explain they said that they had
no cash money. Accordingly, this Court directed the trial court to issue a writ of execution but the attempt
of the special sheriff to enter the private respondent's premises so that he could make an inventory of
personal properties was thwarted by guards and this Court had to direct the Chief of the Philippine
Constabulary to assist in enforcing the writ of execution. The execution yielded only a nominal amount. In
the meantime, Luis dela Rosa is now of age, married with two children, and living in Madrid, Spain with an
uncle but only casually employed. It is said: "His compensation is hardly enough to support his family. He
has no assets of his own as yet." (Rollo, p. 208.)
1. On the amount of the award.
The award of P1,650,000.00 was based on two factors, namely: (a) that the deceased Roberto R. Luna
could have lived for 30 more years; and (b) that hi s annual net income was P55,000.00, computed at
P75,000.00 annual gross income less P20,000.00 annual personal expenses.
This is what the trial court said on Luna's life expectancy:
According to the American Experience Table of Mortality, at age 33 the life expectancy of Roberto Luna
was 33.4 years, and under the Commissioner Standard Ordinary, used by our domestic insurance
companies since 1968 for policies above P5,000.00 his life expectancy was 38.51 years. Dr. Vicente Campa,
medical director of San Miguel Corporation, testified that he was the regular physician of Roberto Luna
since his marriage to Felina Rodriguez in 1957. He said that except for a slight anemia which he had ten
years earlier, Roberto Luna was of good health. Allowing for this condition, he could reasonably expect to
have a life expectancy of 30 years. (Record on Appeal, p. 33.)
The Court of Appeals in sustaining the trial court's conclusion said:
We have not been persuaded to disturb the conclusion that the deceased had a life expectanc y of thirty
years. At the time of Luna's death, he was only thirty-three years old and in the best of health. With his
almost perfect physical condition and his sound mind, the expectation that he could have lived for another
thirty years is reasonable, considering that with his educational attainment, his social and financial
standing, he had the means of staying fit and preserving his health and well-being. That he could have lived
at least until the age of sixty-three years is an assessment which is more on the conservative side in view
of the testimony of Dr. Vicente Campa that the general life expectancy nowadays had gone up to seventy
years. (Rollo, p. 45.)
The Court of Appeals likewise sustained the trial court in respect of Luna's annual income and expense.
This is what the trial court said:
Roberto Luna was 33 years old when he died, and was survived by his wife Felina Rodriguez-Luna, and two
children, Roberto Jr., 13 years, and Jose, 12 years. His wife was 35 years old at the time. He declared a
gross income of P16,900.00 for 1967 (Exhibit I), P29,700,000 for 1968 (Exhibit H) and P45,117.69 for 1969
(Exhibit G). He had investments in various corporations amounting to P136,116.00 (Exhibits K, M, M-1, N,
26
N-1 to N-3, O, O-1, P, Q and R) and was the president and general manager of Rodlum Inc.; general manager
of Esso Greenhills Service Center; Assistant manager of Jose Rodriguez Lanuza Sons; director of Steadfast
Investment Corporation; chairman and treasurer of Greenhills Industrial Corporation; vice -president of
Oasis, Inc.; director of Nation Savings Association; director of Arlun Taxi; and treasurer of National
Association of Retired Civil Employees.
... . His income tax returns show an increase in his income in the short period of three years. It is reasonable
to expect that it would still go higher for the next fifteen years and reach a minimum of P75,000.00 a year.
The potential increase in the earning capacity of a deceased person is recognized by the Supreme Court.
... the court believes that the expected gross earnings of Roberto Luna should be fixed in the sum of
P75,000.00 a year for the period of his life expectancy of 30 years, but deducting his personal expenses
which, because of his business and social standing the court in the amount of P20 ,000.00 a year, in
accordance with the rulings of the Supreme Court. (Record on Appeal, pp. 32 -34.)
Acting on a motion for reconsideration filed by the dela Rosas, the Court of Appeals took into account the
fact "that the deceased Roberto R. Luna had been engaged in car racing as a sport, having participated in
tournaments both here and abroad;" it said that Luna's habit and manner of life should be "one of the
factors affecting the value of mortality table in actions for damages;" and, consequently, concluded that
Luna could not have lived beyond 43 years. The result was that the 30 -year life expectancy of Luna was
reduced to 10 years only.
Further on the motion for reconsideration, the Court of Appeals ruled in respect of Luna's annual personal
expenses:
... . Considering the escalating price of automobile gas which is a key expenditure in Roberto R. Luna's
social standing, We should increase that amount to P30,000.00 as the would be personal expenses of the
deceased per annum. (Rollo, p. 33.)
The Court of Appeals then determined the amount of the award thus: P75,000.00 annual gross income
less P30,000.00 annual personal expenses leaves P45,000.00 multiplied by 10 years of life expectancy and
the product is P450,000.00.
The petitioners contend that the Court of Appeals erred when by its resolution of June 19, 1981, it reduced
Luna's life expectancy from 30 to 10 Years and increased his annual personal expenses from P20,000.00 to
P30,000.00. We sustain the petitioners.
The Court of Appeals, in reducing Luna's life expectancy from 30 to 10 years said that his habit and manner
of life should be taken into account, i.e. that he had been engaged in car racing as a sport both here and
abroad - a dangerous and risky activity tending to shorten his life expectancy. That Luna had engaged in
car racing is not based on any evidence on record. That Luna was engaged in go-kart racing is the correct
statement but then go-kart racing cannot be categorized as a dangerous sport for go-karts are extremely
low slung, low powered vehicles, only slightly larger than foot-pedalled four wheeled conveyances. Itwas
error on the part of the Court of Appeals to have disturbed the determination of the trial court which it
had previously affirmed.
Similarly, it was error for the Court of Appeals to reduce the net annual income of the deceased by
increasing his annual personal expenses but without at the same time increasing his annual gross income.
It stands to reason that if his annual personal expenses should increase because of the "escalating price of
gas which is a key expenditure in Roberto R. Luna's social standing" [a statement which lacks complete
 27

basis], it would not be unreasonable to suppose that his income would also increase considering the
manifold sources thereof.

In short, the Court of Appeals erred in modifying its original decision.

2. Attorney's fees — with or without interest at the legal rate.

The trial court awarded attorney's fees to the petitioners in the sum of P50,000.00. This award was
affirmed by the Court of Appeals in its decision of May 22, 1979. The resolution of June 19, 1981,
reaffirmed the award. The two decisions as well as the resolution do not provide for interest at the legal
rate to be tacked to the award.

The petitioners now pray that the award of attorney's fees be with interest at the legal rate from the date
of the filing of the complaint. There is merit in this prayer. The attorney's fees were awarded in the concept
of damages in a quasi-delict case and under the circumstances interest as part thereof may be adjudicated
at the discretion of the court. (See Art. 2211, Civil Code.) As with the other damages awarded, the interest
should accrue only from the date of the trial court's decision.

The private respondents invoke Elcano vs. Hill, L-24803, May 26,1977; 77 SCRA 98, where it was heldthat
Article 2180 of the Civil Code applied to Atty. Marvin Hill notwithstanding the emancipation by marriage
of Reginald Hill, his son but since Reginald had attained age, as a matter of equity, the liability of Atty.Hill
had become merely subsidiary to that of his son. It is now said that Luis dela Rosa, is now married andof
legal age and that as a matter of equity the liability of his father should be subsidiary only.

We are unwilling to apply equity instead of strict law in this case because to do so will not serve the ends
of justice. Luis dela Rosa is abroad and beyond the reach of Philippine courts. Moreover, he does not have
any property either in the Philippines or elsewhere. In fact his earnings are insufficient to support his
family.

WHEREFORE, the resolution of the Court of Appeals dated June 19, 1981, is hereby set aside; its decision
dated May 22, 1979, is reinstated with the sole modification that the award for attorney's fees shall earn
interest at the legal rate from July 5, 1973, the date of the trial court's decision. Costs against the private
respondents.

SO ORDERED.

[G.R. No. 131915. September 3, 2003]
PEOPLE OF THE PHILIPPINES, appellee, vs. EDDIE LACHICA (at-large), ARIEL ROLLON, and ERROL ROLLON,
accused,
ERROL ROLLON, appellant.
D E C I S I ON
CALLEJO, SR., J.:
Before the Court is the appeal of appellant Errol Rollon from the Decision [1] of the Regional Trial Court of
Romblon, Branch 81, convicting him of murder and sentencing him to suffer the penalty of reclusion
perpetua; and ordering him to pay to the heirs of the victim P50,000.
The Evidence of the Prosecution [2]
In the evening of September 24, 1995, some residents of Sitio Sapang Palay, Barangay Pili, San Fernando,
Romblon, attended the wake of Palmeta Rollon. Among those paying their last respects were Ariel Rollon,
Edgar Perez, Alejandro Rogero and his older brother Melchor Rogero. Ariel and Edgar were already tipsy,
having had a drinking spree in celebration of the birthday of Ariels son. After a while, Ariel and Edgar
decided to go home. On their way, they saw Kagawad Jose Rafol, who was then fixing a rundown water
pipe. For no apparent reason, Edgar boxed Jose. When the latter tried to retaliate, Ariel, who was close
behind, moved in to aid his friend. At that juncture, Kagawad Thomas Rios who was on his way to the
wake, intervened and pacified the protagonists. However, Joses son, Dixon, arrived and punched Edgar
who fell to the ground. Ariel fled to call for reinforcements. After an hour and a half, Ariel, on board a
tricycle driven by his brother Errol Rollon, and armed with a bolo, returned to the wake. With themwere
Eddie Lachica and Salvador Romano, who were each armed with guns. They were followed closely onfoot
by Ariel and Errols father Felipe Rollon, their youngest brother, Filjun Rol lon, and Francisco Rabino.
After the tricycle pulled over the roadside, Errol immediately alighted and boxed Jose. A fisticuffs ensued.
Joses other son, Dicky, arrived, pacified Errol and his father and brought the latter home.
Errol broke a bottle of gin on the pavement. Eddie followed suit, firing his gun into the air. Errol and his
companions pursuedJose and Dicky to their house andpelted it. Whenan occupantof the house screamed
for help, Errol and his group retreated and went back to where the wake was being held. When Ariel
saw Kapitan Tito Royo, he attempted to hack the latter with his bolo, but the bolo hit the wooden pole
which Filjun used to strike Tito. Tito managed to evade the blow, and dove under the table. He thenfled
to his house, which was about 50 meters away. A commotion ensued.
In the meantime, Felipe and his sons Errol and Ariel, with Eddie Lachica, Salvador Romano, Danilo Perez
and Francisco Rabino, all boarded the tricycle and went after Tito. As they reached the gate of Titos house,
they chanced upon Alejandro and Melchor. The two were on their way home from the wake andwere just
waiting for their younger brother Isidro who got separated from them during the commotion. Errol
alighted from the tricycle and greeted Alejandro and Melchor, waving his left hand. Alejandro likewise
waved his hand saying, Pre, waya kita (Friend, there is nothing between us). Errol curtly retorted, Waya
ka diyan (You have nothing here). Errol blocked Alejandro and Melchors way. Ariel vented his ire on
Alejandro and hacked the latter on his left arm. Alejandro retaliated and boxed Ariel, who fell to the
ground. Errol then joined the fray, but was held at bay by Alejandro. Eddie suddenly shot Alejandro, who
fell prostrate to the ground. In the meantime, Melchor could not help his brother because Francisco had
his gun aimed at the latter. Errol then shot Alejandro two more times on the head and on his body. Ariel,
28
for his part, then hacked the hapless Alejandro with his bolo. Melchor somehow managed to sneak out
without being noticed and ran for dear life to the house of Thomas Rios. When Melchor was already inside
the house, he heard someone shout, Patay na ina! (Kill him!). Melchor heard another gunshot.He peeped
through a hole and saw the dead body of his brother, Alejandro, being run over by the tricycle drivenby
Errol. Melchor could only watch in horror and grief. He could not do anything more for his brother.
The malefactors then left the crime scene. Melchor stepped outside and rushed towards his brother, who
was soaked in his own blood. He cried out for help and a handful of people came. Melchor proceeded to
the police station to report the incident but was waylaid by an unidentified person who chased him. He
doubled back and took a shortcut home.
Police authorities arrived at the scene of the crime and investigated the incident. They learned that Errol
and Ariel were among the malefactors. The next morning, SPO4 Ramon Rutor, Chief of Police, PNP San
Fernando, Romblon, arrived at the Sibuyan District Hospital in Cajidiocan, Romblon, where Errol and Ariel
were treated for their injuries. Ariel surrendered to SPO4 Rutor a bolo which was allegedly used by
Alejandro to attack him and his brother.
Dr. Leticia V. Chan, the Municipal Health Officer of San Fernando, Romblon, conducted an autopsy on the
cadaver of the victim. She prepared and signed a Postmortem Examination Report, as follows:
Findings
1. [G]unshot wound of entry cm. in diameter located at the forehead just above the left eyebrow directed
posteriorwards.
2. [B]lood coming out from the left ear.
3. [C]ontused upper and lower left eyelids.
4. [G]unshot wound of entrance, circular, cm. in diameter with contusion collar and located at the
midaxillary area around 6 inches from the armpit directed towards t he right side.
5. [S]uperficial somewhat elongated gunshot wound also cm. in diameter with contusion collar on one side
and located at the outer aspect of the midportion of the left forearm.
6. [S]omewhat oval gunshot wound of entry cm. in diameter located at the left iliac area directed obliquely
downwards, posteriorwards towards the midline.
7. [C]ircular gunshot wound of entry cm. in diameter with uniform contusion collar located at the
midanterior aspect of the right thigh directed posteriorwards.
8. [H]orizontal gaping incised wound 4 inches long located at the upper outer aspect of the right arm.
9. [A]nother same wound 3 inches long below it.
10. [A]nother same wound 2.5 inches long below no. 9.
11. [S]uperficial gaping wound 2.5 inches long cutting the margin of the left ear extending behind
wounding the scalp.
12. [F]our superficial linear incisions below it measuring 1.5", 1.7", 1" and 3" long.

13. [T]en inches long superficial linear incised wound extending from the midback below the nuchal area
to the upper posterior portion of the right arm.
14. [S]uperficial linear incised wound 1.5 inches long at the right shoulder above no. 13.
15. [S]uperficial linear incised wound 4.5 inches long at the right arm above no. 13.
16. [P]artially amputated left thumb.
17. [A]brasion 6 inches long 3 inches wide located at the anterolateral aspect of the l
eft leg.
18. [A]brasion - - right knee.
19. [A]nother wide abrasion at the postero-lateral aspect of the right arm, elbow and forearm.
20. [A]brasion-buttock.
Cause of death: Internal hemorrhage sec. to gunshot wounds of the head, chest and abdomen. [3]
Melchor and Thomas executed their respective sworn statements on t he incident.
After the requisite preliminary investigation, an Information was filed against Ariel and Errol Rollon,and
Eddie Lachica. The accusatory portion of the Information reads:
UNDERSIGNED accuses EDDIE LACHICA, ARIEL ROLLON and ERROL ROLLON of the heinous crime of Murder
as penalized under Republic Act No. 7659, committed as follows:
That on or about the 24 th day of September 1995, at around 10:30 oclock in the evening, [S]itio Sapang
Palay, [B]arangay Pili, [M]unicipality of San Fernando, [P]rovince of Romblon, Philippines, and withinthe
jurisdiction of this Honorable Court, the said accused, with intent to kill, conspiring, confederating and
mutually helping one another, did then and there, by means of treachery, taking advantage of their
superior strength and with cruelty, by deliberately and inhumanly augmenting the suffering of the victim,
or outraging or scoffing at his person or corpse, willfully, unlawfully and feloniously attack, assault, strike
with a bolo and shoot with firearms, one ALEJANDRO ROGERO, inflicting upon the latter multiple mortal
injuries in different parts of his body which were the direct and immediate cause of his death.
Contrary to law. [4]
When arraigned, Errol and Ariel assisted by counsel, pleaded not guilty to the charge. Eddie Lachica
remained at large. Trial on the merits thereafter ensued.
The Evidence of the Accused
Ariel denied the charge. He testified that he and Edgar were at the wake but decided to go home at around
9:00 p.m. Edgar accidentally ran intoKagawad Jose Rafol who was coming from the opposite direction.
Jose confronted and accused Edgar of boxing him. Edgar denied the charge. Ariel joined in and asked Edgar
to apologize, but the latter refused, insisting that he did not punch Jose. Suddenly, Joses son, Dixon came
rushing in at the scene and boxed Edgar. Ariel wanted to help his friend, but Thomas arrived and ranafter
him. Fortunately, he was too fast for Thomas. Ariel then armed himself with a wooden pole and returned
29
to rescue Edgar but when he reached the place where he left his friend, the latter was nowhere to be
found.
Meanwhile, somewhere in the feeder road, at about 10:00 p.m., Felipe, with his two s ons Errol and Filjun,
were on their way to the wake on board a tricycle. They came upon Eddie Lachica who was also on his way
to the wake. They invited Eddie to ride with them and Eddie acceded. [5]
Errol parked the tricycle at the roadside near the place where the wake was being held. As Errol alighted
from the tricycle, Jose suddenly boxed him. A fistfight between the two ensued. Joses other son, Dicky,
intervened and pulled his father away from the fight.
In the meantime, Ariel, who was looking for his friend Edgar, caught sight of their tricycle and decided to
return to the wake. On his way, Tito accosted Ariel and berated the latter for creating trouble in the
community. Ariel, who was already hot under the collar, struck Tito with the pole he was carrying but failed
to hit Tito. The latter retreated and sought help from Alejandro and Melchor Rogero who were then
playing tong-its (a card game) at the wake. Thereafter, Tito, Alejandro and Melchor left and proceeded to
Titos house.
Subsequently, Felipe ordered his sons, including Eddie, to board the tricycle and leave for home. As they
boarded the tricycle, Thomas, armed with a long bolo, arrived and attacked Fe lipe and his companions.
Eddie drew his gun and fired a warning shot in the air. This scared Thomas who hurriedly backed off.
As they made their way through the feeder road en route to home, Eddie, Felipe and the latters sons
noticed Alejandro armed with a bolo, standing in the middle of the road in front of Titos house. Alejandros
shirt was wrapped around his head. As the tricycle steadily approached Alejandro,Errol slackened its speed
and repeatedly blew its horn for Alejandro to get out of the way. Alejandro refused to move. Errol alighted
from the tricycle and talked to Alejandro. While Errol was asking Alejandro to let them pass, Renoso, son
of Tito, told Alejandro to hack Errol, Lab-a na (Hack now).
Alejandro then hacked Errol but the latter eluded the blow. Errols upper left arm was hit. He shoutedfor
help. Eddie responded, left the tricycle and immediately rushed to Errols aid.Eddie placed himself between
Alejandro and Errol to prevent them from hurting each other. However, Alejandro refused to be pacified
and attacked Eddie. The latter fired his gun, hitting Alejandro. Undaunted, Alejandro continued to attack
Eddie. The latter slipped backwards and fired three more successive shots at Alejandro. Eddie then came
closer to the victim, who lay prostrate on the ground, picked up the latters bolo and repeatedly hacked
Alejandro.
Errol then proceeded to the Sibuyan District Hospital in Cajidiocan, Romblon, for the treatment of his
injury. As Alejandros cadaver blocked the road, Ariel and his father Felipe lifted the wheel of the sidecar
so that the tricycle could pass over the body of the victim. But before Ariel could board the tricycle,
somebody from Titos compound fired a shotgun at him. Ariel was hit and cried for help. Errol forthwith
boarded Ariel on the tricycle and drove towards the hospital. Dr. Fermin Fatalla attended to Errol and Ariel.
Eddie left the crime scene, leaving behind the bolo he usedto hackAlejandro. Errol and Ariel were confined
in the hospital for five days.
The morning after the incident, SPO4 Ramon Rutor arrived in the hospital. Ariel surrendered the bolo to
him, claiming that it was the weapon used by the victim to attack him and Errol.

After due proceedings, the trial court rendered judgment finding Ariel and Errol guilty beyond reasonable
doubt of the crime charged. The trial court disbelieved the appellants denials and assertion that Eddie
Lachica alone killed the victim.
Both accused interposed their appeal from the decision of the trial court. In their brief, the appellants
alleged the following:
ASSIGNMENT OF ERRORS
FIRST ASSIGNMENT OF ERROR: The lower court [erred] in failing to closely and objectively appreciate the
evidence of plea of self-defense interposed by the defense in connection with the death of Alejandro
Rogero.
SECOND ASSIGNMENT OF ERROR: The lower court gravely erred in giving credence to the testimonies of
the witnesses for the prosecution which are tainted with inconsistencies and are contrary to human
experience and human conduct.
THIRD ASSIGNMENT OF ERROR: The lower court [erred] in failing to give full faith and credit to the
testimonies of the witnesses for the defense. [6]
On September 2, 1998, Ariel Rollon died due to cardio-respiratory arrest while detained at the Romblon
Provincial Jail. On January 27, 1999, we resolved to dismiss the case. Hence, only the appeal of appellant
Errol Rollon is left for our determination. [7]
The appellant asserts that the trial court erred in not finding that Eddie Lachica alone killed the victim and
that he did not inflict any injury on the victim at all. He also contends that Melchors testimony is incredible
and runs counter with the common experience and observation of mankind. The appellant argues that
under the said circumstances, it was unnatural for Melchor not to lift a finger to save the life of his sibling
Alejandro. Melchors natural reaction should have been to help his brother or seek the aid of the nearest
neighbor to help stop the assault on his brother.
The appellant likewise insists that Kagawad Thomas Rios is a biased witness, being the brother of Carmen
Rios, Ariels estranged wife, whom Ariel left for another woman in Manila. Additionally, he averred that
Thomas and the rest of the kagawads of Barangay Pili had an axe to grind against him because sometime
in the past, he blew the whistle on them for payroll padding.
Finally,the appellantasserts thatthe prosecutionfailedto prove thathe had anyill motive to kill Alejandro.
The appeal is barren of merit.
The threshold issue is whether or not the trial court erred in giving credence and probative weight to the
testimonies of the prosecution witnesses while disbelieving that of the appellant.
Well-settled is the rule that the findings of facts and assessment of credibility of witnesses is a matter best
left to the trial court because of its unique position of having observed that elusive and incommunicable
evidence of the witnesses deportment on the stand while testifying, which opportunity is denied to the
appellate courts. Only the trial judge can observe the furtive glance, blush of conscious shame, hesitation,
flippant or sneering tone, calmness, sigh, or the scant or full realization of an oath all of which are useful
aids for an accurate determination of a witness honesty andsincerity.The trial courts findings are accorded
finality, unless there appears in the record some fact or circumstance of weight which the lower court may
30
have overlooked, misunderstood or misappreciated, and which, if properly considered, would alter the
result of the case.
The rationale for this doctrine, as explained in People vs. Cayabyab [8] is that the trial judge is able to detect
that sometimes thin line between fact and prevarication that will determine the guilt and innocence of the
accused. That line may not be discernible from a mere reading of the impersonal record by the reviewing
court. The record will not reveal those tell-tale signs that will affirm the truth or expose the contrivance,
like the angry flush of an insistent assertion; or the sudden pallor of a discovered lie; or the tremulous
mutter of a reluctant answer; or the forthright tone of a ready reply. The record will not show if the eyes
have darted in evasion, or looked down in confession, or gazed steadily with a serenity that has nothing to
distort or conceal. The record will not show if tears were shed in anger, or in shame, or in remembered
pain, or in feigned innocence. Only the judge trying the case can see all these and on the basis of his
observations arrive at an informed and reasoned verdict. [9]
The denial of the appellant of the crime charged cannot prevail over the positive declarations of the
prosecution witnesses that he and his cohorts killed the victim. Like the defense of alibi, a denial is
inherently weak and crumbles in the light of positive declarations of truthful witnesses who t estified on
affirmative matters that the appellant was at the scene of the incident and was one of the victims
assailants.[10] Moreover, denial, being a negative defense, must be substantiated by clear and convincing
evidence. Otherwise, it would merit no weight in law and cannot be given greater evidentiary value over
the testimony of credible witnesses who testified on affirmative matters. [11] The denial offered by the
appellant is not onlyinherently weak,it lacked a strong corroboration.Indeed, even if the defense of denial
is supported by the testimony of friends of the appellant, it deserves the barest consideration. [12]
In this case, Melchor and Thomas witnessed at close range the macabre and gory killing of the victimby
the appellant and his cohorts. Melchor, the victims brother, testified, thus:
PROS. SY continuing:
Q Where were you when your brother Alejandro Rogero was killed by the accused?
A I was in that place. [13]
Q Who was your companion or companions by the gate of barangay captain Royo?
A My younger sibling.
Q Who is that younger sibling who was with you?
A Alejandro Rogero.
Q Now, why were you and your brother Alejandro standing by that gate?
A We were waiting for our another (sic) younger sibling so we would go home together.
Q Why, where was your other sibling?
A I did not know where he was hiding.
Q Why should your brother hide?
A Because there was a trouble which happened at the wake. [14]
 31

... A Bolo.

Q Now, you said that at 10:30 in the evening you and Alejandro were standing by the gate of Kapitan Royo, Q And who was hacked by Ariel?
while doing that what happened?
A My younger brother Alejandro.
A They, Errol Rollon riding at the tricycle arrived.
Q And where was your brother hit?
Q Alright, who were riding on that tricycle?
A Here (witness is demonstrating by slicing with his right hand his upper left arm).
A Ariel Rollon, Errol Rollon, Eddie Lachica, Felipe Rollon, Salvador Romano, Danilo Perez, Francisco
Rabino.[15] Q After that, what happened next?

... A My brother fought back.

Q Now, when the tricycle arrived with those persons in it, what happened? Q And what did your brother do?

A Errol alighted and waived his hand to my younger brother (witness demonstrating by raising his left hand A He boxed Errol and Ariel.
and waived). [16]
Q And what happened to Ariel?
...
A Ariel was thrown back.
Q And what did your younger brother do?
Q How about Errol?
A He also waived.
A He fell down.
Q Did you hear any exchange from them if there was any?
Q So after that, what did your brother do?
A Yes, sir.
A He was standing watching them before he was shot.
Q What did you hear?
Q Who shot him?
A I heard from my younger brother Pre, waya kita meaning Pare, there is nothing between us.
A Eddie Lachica.
Q How about Errol, did Errol reply to that?
Q How far was Eddie Lachica when he shot your brother Alejandro?
A Yes, sir.
A From here to that wall. (Witness is pointing to the opposite wall from the witness stand measured at 5.3
Q What did he say? meters).

A Errol said: Waya ka diyan, meaning You have nothing there. Q And what happened to your brother when he was shot by Eddie Lachica?

Q So when you and your brother heard that, what did you do? A He turned around twice then fell down.

A We left. Q How about you, what did you do while your brother was fighting back Errol and Ariel?

Q And what happened? A I was standing because I was afraid.

A Ariel chased us. ...

Q And what did he do? Q So after Eddie Lachica shot your brother, what else happened?

A He said: Ikay pa? meaning You also? and simultaneously hacked. A Errol stood up and shot again my younger brother.

Q Now, what was that Ariel was holding? Q How many times?
 32

A Twice. Q And what did you see?

COURT: A I saw they ran over the body of my younger brother with the tricycle.

Q Who shot him twice? Q How many times did they run over with the tricycle the body of your brother?

A Errol.[17] A I saw it twice.

... Q So what did you do after that?

Q And how about Ariel, what did Ariel do? A No more (sic), I just cried.

A He hacked and hacked my younger brother. Q And what else did you do?

Q When Errol shot your younger brother, what was the position of your younger brother? A That is all. I cried because I pitied my younger brother. [19]

A Lying on his back. Melchors testimony was corroborated by Kagawad Thomas Rios, to wit:

Q When Ariel hacked and hacked your brother, what was the position of your younger brother? PROS. SY

A He was lying on his side. [18] Q So after that, what have you observed?

... A They met in front of the gate of the house of [the] Kapitan, the brothers Melchor and Alejandro Rogero.

Q At that point when your brother was being hacked and hacked by Ariel, where were you? Q And so, when they met the brothers Melchor and Alejandro in front of the gate of the house of the
Kapitan, what happened?
A I was at the front of the house of Tomas.
A Alejandro waived his right hand to Errol.
Q After that, what did you do?
Q Did Errol respond to that way?
A I ran away going to the house of Manong Thomas. I knocked.
A Errol also waived his hand while Alejandro said, Errol, Pare wala kita, meaning Pare, theres nothing
Q And was the house opened for you? between us. Errol answered waiving his hand, you have nothing to do with it.
A Yes, sir. Q After that, what happened?
Q By whom? A Ariel shouted, Ikaw pa! meaning, You also! and simultaneously hacked Alejandro.

A His daughter Thelma Relox (sic). Q Where was Alejandro with reference to Ariel when Ariel hacked Alejandro?
Q And so, what did you do? A Ariel was [at] the back of Alejandro.
A I was standing inside when I heard Patay na ina! meaning Kill him! Q And where was Alejandro hit when he was hacked by Ariel?

Q Who said that? A Left shoulder.

A I do not know because I was already inside. Q So, what happened after that?
Q And what else did you hear while you were inside? A When Alejandro was hacked by Ariel, Alejandro fought back, then Ariel and Errol ganged up on
Alejandro.
A I heard another shot.
Q Where was Melchor at that time, the brother?
Q After that, what else happened?
A They were there together.
A I peeped through the hole and I looked outside.
 33

Q How about Melchor, what was he doing when his brother Alejandro was hacked and being ganged up A- Yes, sir. (Witness pointing to the accused Errol Rollon who was sitting on the bench and when asked
by Ariel and Errol? about his name, answered Errol Rollon). [23]

A He just stood as if in shock. More importantly, the autopsy conducted by Dr. Leticia V. Chan on September 25, 1995, corroborated the
testimony of the witnesses, that the appellant and his group shot and hacked the victim. The physical
Q How about you, what did you do? evidence shows that the victim sustained a total of no less than 20 wounds 5 gunshot wounds and 11
incised wounds on different parts of his body, a partially amputated thumb and several abrasions. In
A I did not do anything because I might be hit also.
contrast, the appellant did not suffer any major injuries, except for the minor cut on his left arm which was
Q So, what happened to Alejandro? inflicted by his late brother Ariel when the appellants group ganged up on the victim to finish him off. It is
difficult to believe that Alejandro could, all by his lonesome, initiate the attack on the appellant and his six
A When he boxed Errol, Errol fell down. cohorts who were each armed with bolos and handguns. Even if Alejandro was, as claimed by the
appellant,armed with a bolo, he was at the mercy of the appellantand his six cohorts. The claim, therefore,
Q And after that, what happened next? of the appellant that Alejandro single-handedly attacked them is weak and flimsy.

A When Errol fell down, Eddie Lachica shot Alejandro. Physical evidence is evidence of the highest order. It speaks more eloquently than a hundred
witnesses.[24] In the case at bar, the physical evidence, consistent with the testimonies of the prosecution
Q Where was Alejandro hit?
witnesses, established the appellants culpability beyond reasonable doubt.
A I do not know where he was hit but Alejandro fell.
Melchor cannot be faulted for not helping his brother even as the latter was shot and boloed to death.
Q After Alejandro fell, what happened? This is so because Francisco Rabino pointed his gun at Melchor, thus immobilizing the latter. As testified
to by Melchor:
A When Errol stood up, he also pulled out a gun which is short and shot Alejandro who was on the ground
twice. Q When Eddie Lachica shot your brother, where were you?

Q After that, what else have you observed? A I was near the house of Tomas Relox (sic).

A Errol rode on the tricycle and ran over Alejandro, pinned down Alejandro with the tricycle .[20] Q So, why did you go there?

The two witnesses pointed to and identified the appellant as one of the assailants: A Because I moved backward because something was aimed at me.

PROS. SY: Q What was that that was (sic) aimed at you?

Q How about Errol Rollon, do you know him? A Gun.

A Yes, sir. Q And who was aiming that gun at you?

Q If he is in the courtroom, will you please point to him? A Francisco Rabino. [25]

A (Witness is pointing to a man who when asked his name answered Errol Rollon). [21] Melchor cannot be blamed for opting to stay put. He would be risking his own life if he tried to help his
brother. Case law has it that no standard form of behavioral response could be expected from anyone,
Thomas Rios testified as follows: when confronted with a strange, startling or frightful occurrence. [26] Melchor was apparently terrifiedby
what he saw, and fear has been known to render people immobile and helpless particularly, such as here,
PROS. SY : in life and death situations.[27] This is a normal reaction in such a situation. Any person faced with suchan
overwhelming opposition would sufficiently be cowed by fear or at least compelled to act in a manner
Q- How about Errol Rollon, do you know him?
aimed at self-preservation. It is a fact of life that different people react differently to the same types of
A- Yes, sir.[22] situations. [28]

... The relationship of a witness to the victim, far from rendering his testimony biased, would even render it
more credible as it would be unnatural for a relative who is interested in vindicating the crime to accuse
Q- If Errol Rollon is in the courtroom, will you be able to poi nt him? somebody other than the real culprit.[29] The appellant did not adduce any evidence to show that Melchor

had ulterior motives in testifying falsely against him or mendaciously implicating him, if indeed he was not
involved in the killing.
Unavailing is the appellants imputation of ill-motives against Kagawad Thomas Rios. Kagawad Thomas
testimony cannot be discredited on these bases alone, as indeed, the appellant failed to prove thatthese
alleged ill-motives reached such an intensity as to cause the good kagawad to falsely attribute a crime so
serious as murder to the appellant.
Unavailing, too, is the appellants argument that he deserves an acquittal simply because the prosecution
failed to prove any motive for him to commit the crime. It must be stressed that motive is a state of ones
mind which others cannot discern. It is not an element of the crime, and as such does not have to be
proved.[30] In fact, lack of motive for committing a crime does not preclude conviction. It is judicial
knowledge that persons have been killed or assaulted for no reason at all. [31] More importantly, the lack of
motive on the part of the appellant is of no consequence, in view of his positive identification by the
witnesses, because motive assumes significance only where there is no showing of who the perpetrator of
the crime was. [32] Verily
Positive identification where categorical and consistent and without any showing of ill motive on the part
of the eyewitness testifying on the matter prevails over a denial which, if not substantiated by clearand
convincing evidence is negative and self-serving evidence undeserving of weight in law. They cannot be
given greater evidentiary value over the testimony of credible witnesses who testify on affirmative
matters. [33]
Settled is the rule that where there is no evidence and nothing to indicate that the principal witnesses for
the prosecution were actuated by improper motive, the presumption is that they were not so actuated
and their testimonies are entitled to full faith and credit. [34] Moreover, the weight of the testimony of
witnesses is not impaired nor in anyway affected by their relationship to the victim when there is no
showing of improper motive on their part. [35]
The Crime Committed by the Appellant
We agree with the trial court that the appellant is guilty of murder under Article 248 of the RevisedPenal
Code, as amended by Republic Act No. 7659, qualified by abuse of superior strength as alleged in the
Information. To take advantage of superior strength is to purposely use excessive force, out of proportion
to the means of defense available to the person attacked. [36] In the case at bar, there was a clear and gross
disparity of strength between the unarmed victim and the four armed assailants three of whom were
armed with firearms. The victim gave no provocation and was in fact already backing off when he was
attacked.
The Proper Penalty for the Crime
The appellants use of a firearm to consummate the crime cannot, however, be considered as a special
aggravating circumstance because there was no such allegation in the Information that the appellant had
no license to possess the firearm, as mandated by Section 9, Rule 110 of the Rules of Criminal
Procedure. [37] The lack of a license to possess firearms is an essential element of the crime of violation of
P.D. No. 1866, as amended by Republic Act No. 8294, whether as an independent crime or as an
aggravating circumstance in murder or homicide.[38] Hence, such circumstance cannot aggravate the crime
of murder and the penalty therefor; otherwise, the appellant would be deprived of his right to be informed
of the nature of the charge against him. Although the crime was committed before the effectivity of the
said Rule, the same should be applied retroactively as it would be favorable to the appellant. [39]
34
Under Article 248 of the Revised Penal Code, as amended by Republic Act No. 7659, murder is punishable
by reclusion perpetua to death. With no generic or special aggravating circumstances and one generic
mitigating circumstance of voluntary surrender, the penalty imposable on the appellant, in accordance
with Article 63(3) of the Revised Penal Code, should be the minimum period, which is reclusion perpetua.
Civil Liabilities of the Appellant
Conformably to recent jurisprudence, we sustain the amount of P50,000 for civil indemnity. Article 2206
of the Civil Code provides that when death occurs as a result of a crime, the heirs of the deceased a re
entitled to be indemnified without need of any proof thereof. [40]
We cannot award moral damages in the absence of proof of mental or physical suffering on the part of the
heirs of the victim. [41]
As to actual damages, while Melchor Rogero testified that they incurred burial and other expenses
resulting from the death of Alejandro, no competent evidence was presented to prove his claim. Under
Article 2199 of the Civil Code, a party is entitled to compensation only for such pecuniary loss suffered by
him as he has duly proved. Only substantiated and proven expenses, or those that appear to have been
genuinely incurred in connection with the death, wake or burial of the victim will be recognized in
court.[42] However, under Article 2224 of the same Code, temperate damages may be recoveredwhen the
court finds that some pecuniary loss has been suffered but its amount cannot, from the nature of the case,
be proved with certainty. In the present case, the heirs of Alejandro clearly incurred funeral and burial
expenses. Hence, we find that the amount of P7,500 [43] by way of temperate damages is justified.
In the same vein, loss of earning capacity cannot be awarded to the victims heirs in the absence of
competent proof thereof. While Melchor testified on the victims income, the same could not serve as a
basis for lost earnings. Indemnification for loss of earning capacity partakes of the nature of actual
damages which must be duly proven; a nd a self-serving statement, being unreliable, is not enough. For
lost income to be recovered, there must be an unbiased proof of the deceaseds average, not just gross,
income. [44]
Additionally, given the attendance of the qualifying circumstance of abuse of superior strength, the award
of exemplary damages in the amount ofP25,000 to the heirs of the victim[45] in accordance with Article
2230 of the Civil Code, is in order. [46]
WHEREFORE, the appealed decision of the Regional Trial Court of Romblon, Branch 81, finding appellant
Errol Rollon guilty beyond reasonable doubt of murder is hereby AFFIRMED. The civil aspect of the case is
MODIFIED to read: The appellant is hereby ORDERED to pay the heirs of the victim Alejandro Rogerothe
amounts of P50,000 as civil indemnity; P7,500 as temperate damages; and P25,000 as exemplary
damages. Costs against the appellant.
SO ORDERED.

[G.R. No. 163351. June 21, 2005]
ANTONIO V. NUEVA ESPAA, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.
D E C I S I ON
CORONA, J.:
At about 11:15 a.m. on May 15, 1998, petitioner Antonio E. Nueva Espaa was driving a passenger bus
owned by Vallacar Transit, Inc. He was then traversing the national highway of Calag-Calag, Ayungon,
Negros Oriental and was southbound going to Dumaguete City. While negotiating a curve, the passenger
bus collided with a northbound Honda motorcycle. As a result, Reynard So, the driver of the motorcycle,
and Nilo Castro, the person riding in tandem with him, were killed. An information for reckless imprudence
resulting in double homicide[1] was filed against petitioner who was also accused of failing to extend aid or
assistance to the victims.
During the trial of the case, the prosecution presented Julito Dayuday and Florencio Banico as
eyewitnesses to the collision. The father of So and the mother of Castro were also called to the witness
stand to substantiate their respective claims for damages.
Julito Dayuday, a resident of Calag-Calag, Ayungon, Negros Oriental, testified that he was waiting for a ride
to Dumaguete City when the collision between the bus and the Honda motorcycle occurred. He sawthe
bus coming from the north going to Dumaguete City and, in the opposite direction, a pedicab being
followed by a Suzuki motorcycle and a Honda motorcycle on which So and Castro were riding. Upon
approaching the curve on the highway, the bus swerved from its lane and struck the Honda motorcycle.
The motorcycle snagged onto the left front fender of the bus and was dragged about 24 meters to the
right of the southbound lane. So had been thrown to the ground by the time the bus finally stopped.
Dayuday testified that he saw the accused get off the bus with the conductor and the passengers but,
instead of assisting the victims, he casually walked away from the scene of the accident.
Florencio Banico, on the other hand, was a passenger of the bus driven by petitioner. He corroborated the
testimony of Dayuday that the bus hit the motorcycle while it was negotiating a curve on the highway of
Calag-Calag. He also stated in court that the accused left the scene of the accident while the victims lay
dying on the road. He heard Castro shouting for help while So was unconscious. He testified that nobody
helped the victims.
The father of So testified that his son was 30 years old at the time of his death and he was engagedin the
buying and selling of copra. He was likewise a sugar cane planter and maintained a sari-sari store. Sos
father claimed that his son was earning P30,000 a month from his copra business and sari-sari store,
and P50,000 a month from selling sugar cane. He added that his family spent P87,200 [2] for the wake and
funeral. He also demanded payment of attorneys fees of P30,000.
The mother of Castro, on the other hand, testified that her son was 26 years old when he died. He worked
as welder in Manila and earned P8,000 a month. She allegedly spent P30,000 for her sons wake and burial.
For the defense, SPO2 Dolger Germundo, SPO3 Hilbert Arinaza, Roche Taburasa and the petitioner himself
were called to the witness stand.
SPO2 Germundo, a policeman, testified that he found the southbound bus in its proper lane when he
arrived at the site after the collision. He did not see any tire or skid marks which meant that the point of
impact was at the center of the road, as stated by the prosecution witnesses. In his sketch[3] and
35
photograph[4] of the accident, the passenger bus and the Honda motorcycle were at the outer partof the
southbound lane, which was the lane the bus was traversing at the time of the accident. Due to the
positions of the colliding vehicles, he concluded that it was the motorcycle that rammed into the bus.
SPO3 Arinaza of the Philippine National Police testified that he was on his way to Dumaguete City on board
the bus driven by petitioner. At the time of the accident, he was seated behind petitioner-driver andfelt
the Honda motorcycle smash into the bus.
Taburasa, for his part, claimed he was the driver of the Suzuki motorcycle So tried to overtake when they
were both nearing the curve on the highway of Calag-Calag. He claimed the collision occurred because the
Honda motorcycle overshot its lane in its attempt to overtake him. He corroborated the declaration of
SPO3 Arinaza that Sos motorcycle hit the left front fender of the bus.
When petitioner (the accused) was called to the witness stand, he denied the accusations against him.He
testified that the Honda motorcycle swerved out of its lane and veered towards the bus, resulting in the
collision. After the incident, he allegedly went down the bus to aid the victims and even helped carrythem
into the vehicle that brought them to a nearby hospital. He thereafter went to a police station to report
the incident.
The trial court gave no credence to the defense witnesses and convicted petitioner of the crime charged.
The dispositive part of the decision read:
WHEREFORE, premises considered, this court finds accused, ANTONIO VILLANUEVA NUEVA ESPAA, guilty
beyond reasonable doubt for the crime of RECKLESS IMPRUDENCE RESULTING TO DOUBLE HOMICIDE, and
aggravated by his failure to help the victim, as provided for Article 365 of the Revised Penal Code, and
appreciating in his favor the benefits of the Indeterminate Sentence Law, is hereby imposed the
indeterminate penalty of SIX (6) MONTHS of arresto mayor as minimum to SIX (6) YEARS AND ONE (1) DAY
of prision correcional as maximum, and to pay the following damages:
TO THE HEIRS OF THE VICTIM REYNARD SO
1) P2,997,000.00 indemnity for loss of earning capacity of victim
2) 14,200.00 for expenses of the wake
3) 20,000.00 for funeral parlor
4) 12,000.00 for the tomb
5) 53,000.00 for cost of burial site
6) 30,000.00 for attorneys fees
7) 200,000.00 for moral damages
8) 100,000.00 for exemplary damages
P3,429,200.00 TOTAL AMOUNT
which total amount shall bear interest at the rate of TWELVE (12%) percent per annum from the date of
this decision until the same is paid.
 36

TO THE HEIRS OF VICTIM NILO CASTRO x = 36 x P48,000.00

1) P1,728,000.00 indemnity for loss of earning capacity x = P1,728,000.00

2) 20,000.00 for funeral expenses which the trial court correctly computed.

3) 200,000.00 for moral damages The other items of damages awarded are correct. [6]

4) 50,000.00 for exemplary damages The appellate court likewise provided for the subsidiary liability of petitioners employer under Article
103 [7] of the Revised Penal Code. The dispositive portion of the decision read:
P1,998,000.00 TOTAL AMOUNT
WHEREFORE, the Decision appealed from is AFFIRMED, subject to MODIFICATION as to the penalty
which total amount shall bear interest at the rate of TWELVE (12%) percent per annum counted from the imposed; the indemnity for loss of earning capacity of the victim Reynard So; the reckoning date of the
date of this decision until the same is fully paid. start of the 12% interest imposed; and the subsidiary civil liability of the accused appellants employer, all
as herein-above indicated. Costs against appellant.
Cost against accused.
SO ORDERED.[8]
So ordered. [5]
In this appeal before us, petitioner insists that he should notbe made liable for the mishapas itwas actually
Via a petition for review, petitioner appealed the judgment of the court a quo to the Court of Appeals. On
the Honda motorcycle that rammed into the bus he was driving. He seeks the reversal of his conviction for
November 2, 2003, the appellate court modified the assailed judgment:
reckless imprudence resulting in double homicide. The issues raised by him can be summarized as follows:
Consequently, the penalty imposed by the trial court is erroneous. The appellant should suffer the
1. the ruling of the Court of Appeals is untenable and contrary to law because the evidence of the
indeterminate penalty of SIX (6) YEARS of prision correcional, as minimum, to EIGHT (8) years of prision
prosecution is incompatible with the physical evidence on record;
mayor, as maximum.
2. the award of damages in the (total) amount of more than P18 Million is untenable and contrary to
As to the civil liability, particularly the indemnity for the loss of the earning capacity of the victims, the
jurisprudence and law. [9]
formula last enunciated by the Supreme Court is:
On the first issue, the Court does not ordinarily pass upon the findings of fact of the trial court, specially if
Net earning capacity (x) = life expectancy x gross -living
they have been affirmed on appeal by the appellate court. [10] The trial court was able to observe the
expenses annual (50% of witnesses and their demeanor on the stand and was in a position to scrutinize and discern whether they
were telling the truth. [11] Without any clearshowing that the trial courtand the appellate courtoverlooked,
gross annual misunderstood or misapplied some facts or circumstances of weight and substance, the rule should not
be disturbed. In the case at bar, we see no reason to deviate from the rule. The Court is in full agreement
income) with the trial court and with the Court of Appeals regarding petitioners liability for the crime charged
against him.
Thusly, since the victim Reynard So was earning P80,000 a month at the time of his death when he was
thirty (30) years old, his lost earning capacity should be computed as follows: On the second issue, however, we deem it necessary to modify the award of damages given by the lower
courts.
x = 2 (80 ― 30) x [P960,000.00 ― P480,000.00)
When death occurs due to a crime, the following damages may be recovered: (1) a civil indemnity ex
3
delicto for the death of the victim; (2) actual or compensatory damages; (3) moral damages; (4) exemplary
x = 33.4 x P480,000.00 damages; (5) attorneys fees and expenses of litigation, and (6) interest, in proper cases.

x = x P16,032,000.00 CIVIL INDEMNITY ex delicto

With respect to the victim Nilo Castro, he was earning P8,000.00 a month when he died at the age of Both the trial court and the Court of Appeals failed to award civil indemnity ex delicto to the heirs of the
twenty-six (26). His lost earnings were: victims. The award for civil indemnity is mandatory and is granted to the heirs of the victim withoutneed
of proof other than the commission of the crime. [12] Hence, based on recent jurisprudence [13], the award
x = 2 (80 ― 26) [P96,000.00 ― P48,000.00] of civil indemnity ex delicto of P50,000 each for the heirs of both So and Castro is in order.

3 ACTUAL DAMAGES: INDEMNITY FOR LOSS OF EARNING

 37

CAPACITY AND OTHER COMPENSATORY DAMAGES ATTORNEYS FEES

With respect to indemnification for loss of earning capacity, the Court, in the case of People vs. We affirm the award of P30, 000 for attorneys fees made by the trial court and the appellate court.Under
Mallari,[14] enunciated: Article 2208 of the Civil Code, attorneys fees and expenses of litigation may be recovered when exemplary
damages have been awarded, as in this case.
The rule is that documentary evidence should be presented to substantiate a claim for loss of earning
capacity. By way of exception, damages therefore may be a warded despite the absence of documentary SUMMARY
evidence if there is testimony that the victim was either (1) self-employed, earning less than the minimum
wage under current labor laws, and judicial notice is taken of the fact that in the victim's line of work, no To summarize, the heirs of the deceased Reynard So are entitled to the following:
documentary evidence is available; or (2) employed as a daily-wage worker earning less than the minimum
P 50,000 civil indemnity ex delicto
wage under current labor laws. [15]
73,000 actual damages
In this case, neither of the two exceptions applied. The earnings of So and Castro were both above the
minimum wage set by labor laws in their respective workplaces at the time of their death. [16] This being 25,000 temperate damages [26]
the case, the general rule of requiring documentary evidence of their earning capacities finds application.
Unfortunately for their heirs, no such proof was presented at all. It was therefore erroneous for both the 50,000 moral damages
trial court and the Court of Appeals to award compensatory damages for loss of earning capacity on the
basis alone of the oral testimonies of Sos father and Castros mother. 25,000 exemplary damages

The lack of documentary evidence notwithstanding, since loss was actually established in this case, 30,000 attorneys fees
temperate damages in the amount of P25,000 each may be awarded to the heirs of So and Castro,
P 253,000 TOTAL
respectively. Under Article 2224 of the Civil Code, temperate or moderate damages (which are more than
nominal but less than compensatory damages) may be recovered when the court finds that some The heirs of Nilo Castro are also entitled to the following:
pecuniary loss was suffered but its amount cannot be proved with certainty. [17]
P 50,000 civil indemnity ex delicto
With respect to other compensatory damages, [18] the Court in People v. Agudez[19] declared that
competent evidence must likewise be presented to support the claim for such damages. In the case atbar, 50,000 temperate damages [27]
the father of So claimed that he spent P87,200 [20] for the wake and burial of his son but all he was able to
support with receipts were the payment to the funeral parlor of P20,000 and the cost of the burial site 50,000 moral damages
of P53,000. [21]
25,000 exemplary damages
Regarding the claim for reimbursement of the actual expense allegedly incurred by the mother of Castro,
30,000 attorneys fees
the Court opts to award her temperate damages, in lieu of actual or compensatory damages, because she
failed to submit any evidence in support thereof. Again, temperate damages should instead be givensince P 205,000 TOTAL
it was to be expected that she spent for the burial and funeral services although the amount thereof was
not determined with certitude. [22] SUBSIDIARY LIABILITY

MORAL DAMAGES
The award for moral damages by the court a quo, as affirmed by the Court of Appeals, should be adjusted
for being excessive. While courts have a wide latitude in ascertaining the proper award for moral damages,
the award should not be to such an extent that it inflicts injustice on the accused. The award of P200,000
as moral damages each for the heirs of So and Castro, respectively, should accordingly be reduced
to P50,000. [23]
EXEMPLARY DAMAGES
Under Article 2230 of the Civil Code, exemplary damages may also be imposed when the crime was
committed with one or more aggravating circumstances. Here, petitioner failed to render aid or assistance
to his victims after the collision. [24] Based on the prevailing jurisprudence, the award for exemplary
damages for homicide is P25,000. [25]
We adopt the pronouncement of the Court of Appeals regarding the subsidiary liability of peti tioners
employer, Vallacar Transit Inc., under Article 103 of the Revised Penal Code. An employer may be
subsidiarily liable for the employees civil liability in the criminal action if it can be shown that: (1) the
employer is engaged in any kind of industry; (2) the employee committed the offense in the discharge of
his duties and (3) the accused is insolvent.[28] However, subject to prevailing jurisprudence,[29] the
subsidiary liability may be enforced only upon a motion for subsidiary writ of execution against Vallacar
Transit, Inc. and upon proof that petitioner is insolvent.
IMPRISONMENT
Lastly, we are also constrained to amend the penalty imposed by the Court of Appeals. The imposable
penalty, under Article 365 (2) of the Revised Penal Code for homicide resulting from reckless imprudence
 38

in the use of the motor vehicle is prision correcional in its medium and maximum period, which ranges
from 2 years, 4 months and 1 day to 6 years.

Under Article 64 of the same law, the penalty shall be divided into three equal portions, each of which
shall form one period. The offense having been attended by one aggravating circumstance premised on
the failure of petitioner to aid his victims, the penalty shall be increased but it cannot exceed the penalty
provided by law in its maximum period. [30] Applying the provisions of the Indeterminate Sentence Law, the
petitioner is thus entitled to a minimum term to be taken from the penalty next lower in degree, which
is arresto mayor in any of its periods, to prision correcional maximum. Accordingly, petitioner should
suffer the penalty of 2 years, 4 months and 1 day of arresto mayor, as minimum, to 6 years of prision
correcional, as maximum.

WHEREFORE, the decision appealed from is AFFIRMED with MODIFICATIONS as to the award of damages
and the penalty imposed, as already discussed. The total amount of damages shall bear interest at the rate
of 12% per annum from the finality of this decision.

Costs against petitioner.

SO ORDERED.

[G.R. No. 120141. April 21, 1999]
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. LORNA B. GUEVARRA, JOSIE BEA and PEDRO BEA,
JR., accused-appellants.
D E C I S I ON
PARDO, J.:
The case before the Court is an appeal from a decision [1] of the Regional Trial Court, Branch 6, Legaspi City,
convicting accused Lorna B. Guevarra, Josie Bea and Pedro Bea, Jr., of illegal recruitment by a syndicate in
large scale, and sentencing all three accused to life imprisonment and to pay a fine of one hundred
thousand (P100,000.00) each, and to indemnify each of the complainants, namely, Wilfredo Belbes,
Ermelita Bocato, Rizalina Belbes, Alan Banico and Arnel Basaysay, [2] jointly and severally, the amount of
thirty thousand pesos (P30,000.00) for the placement fees collected, and twenty thousand pesos
(P20,000.00) as moral damages, and costs.
On January 17, 1994, Assistant Provincial Prosecutor Ignacio N. Almodovar, Jr. of Albay charged Lorna B.
Guevarra, Josie Bea and Pedro Bea, Jr. with illegal recruitment committed by a syndicate in large scale, as
follows:
"That sometime in August and September, 1993, at Barangay San Andres, Sto. Domingo, Albay and within
the jurisdiction of this Honorable Court, the 3 (three) above-named accused conspiring, confederating and
mutually helping one another for a common purpose did then and there, without any license or authority
to do so, recruit WILFREDO BELBES Y BALLARES, ERMELITA BALBIN BOCATO, RIZALINA BELBES Y BALLARES,
ALAN BANICO Y BELBES and ARNEL A. BAGAYSAY, all of Brgy. San Andres, Sto. Domingo, Albay for a job
placement in Malaysia and received from the five victims P30,000.00 each as processing fee; that on
September 25, 1993, the five recruits flew to Kuala Lumpur, Malaysia, expecting as per instruction of the
accused, that somebody will fetch them at the airport and will bring them to their employer; that nobody
fetched them as they did not have any employer in Malaysia which forced them to go back to the
Philippines, to their damage and prejudice.
CONTRARY TO LAW. [3]
Upon arraignment on February 14, 1994, [4] all three accused entered a plea of not guilty. After due trial,
on February 15, 1995, the court a quo rendered a decision, the dispositive portion of which reads as
follows:
WHEREFORE, premises considered, decision is hereby rendered finding the accused Lorna Guevarra, Pedro
Bea, Jr. and Josie Bea GUILTY beyond reasonable doubt of the crime of ILLEGAL RECRUITMENT qualified
into large scale recruitment and by a syndicate and hereby sentences each of the said accused to suffer
the penalty of LIFE IMPRISONMENT and to pay a FINE of One Hundred Thousand(P100,000.00) Pesos each,
and to indemnify each of the complainants, jointly and severally P30,000.00 for the placement fees they
have collected, and the further sum of P20,000.00 for each of the complainants as moral damages and to
pay the costs.
"SO ORDERED.[5]
Hence, this appeal.
The facts, as established by evidence of the prosecution, are as follows:
39
On August 23, 1993, accused Lorna Guevarra visited Rizalina Belbes in her house in Sto. Domingo, Albay,
and offered her an opportunity to work in Malaysia for a salary of nine thousand pesos (P9,000.00) for the
first three months and an increase of at least three thousand pesos (P3,000.00) thereafter.Guevarra also
approached Wilfredo Belbes, the brother of Rizalina, to convince him to work abroad. Guevarra assured
them that she had the capability of sending workers abroad and that her connection was on a direct hiring
basis.[6] Guevarra made several visits until Rizalina and Wilfredo agreed to meet accused spouses Josie and
Pedro Bea, Jr. in Bonga, Bacaycay, Albay. The spouses Bea continued to persuade Rizalina and Wilfredo to
accept the job offers. [7]
Likewise, on August 23, 1993, accused Guevarra went to the house of Ermelita Balbin Bocato, promising
overseas employment, high salary, and free board and lodging. Guevarra also introduced Ermelita to
accused spouses Bea. All three accused kept persuading Ermelita to pay thirty thousand pesos
(P30,000.00) as placement fee for the opportunity to work abroad. After much coaxing, Ermelita finally
agreed and gave five thousand pesos (P5,000.00) as initial payment, in the presence of Rizalina Belbes,
who also gave her initial payment of four thousand pesos (P4,000.00). [8]8
On September 16, 1993, Ermelita paid her balance of twenty-five thousand pesos (P25,000.00) at a
canteen near the Physicians Tower at United Nations Avenue, Manila. She also saw Rizalina Belbes pay her
balance of twenty-six thousand pesos (P26,000.00) and the further sum of thirt y thousand pesos
(P30,000.00) for Wilfredo Belbes. The accused spouses Bea received these payments. [9]
Accused Guevarra also enticed Gloria Banico to let her son Alan Banico work in Malaysia, where an
employer offered free board and lodging with a starting salary of nine thousand pesos (P9,000.00) to be
increased to twelve thousand pesos (P12,000.00) after three months. [10] She also introduced Gloria to the
accused spouses Bea, who continued convincing her to send her son to Malaysia to work. After some time,
Gloria finally agreed and paid the placement fee of thirty thousand pesos (P30,000.00) to Josie andPedro
Bea, Jr.[11]
Accused Guevarra also offered overseas employment to Arnel Basaysay, as a worker in a glove factory in
Malaysia with a starting salary of nine thousand pesos (P9,000.00), to be increased after three
months. Accused Guevarra kept going to the house of Arnel, accompanied by Josie Bea. Guevarra
managed to convince the father of Arnel to agree to the offer and to pay the placement fee for his son.[12]
All the complainants trusted Lorna Guevarra, as they all resided in the same barrio. [13] Complainants
believed that the proposed overseas employment was legitimate, so they did not ask too many questions
on the authority of the three accused. The complainants also trusted Pedro Bea, Jr. and Josie Bea, who
gave assurances that complainants were not being fooled. [14]
On September 24, 1993, Rizalina and Wilfredo Belbes, Ermelita Bocato and Arnel Basaysay receivedtheir
passports and PAL plane tickets.
On September 25, 1993, the three accused were at the airport to brief the complainants about the
trip. Accused Josie Bea assured the complainants that their prospective employer will meet them at the
Kuala Lumpur airport.[15] At this time, Josie Bea handed over the passport and plane ticket of Alan
Banico.[16]
The complainants left the Manila airport at 3:30 in the afternoon. Uponarrival in Kuala Lumpur three hours
later, the complainants waited in the airport for someone to meet them.

After waiting until nighttime without anybody fetching them at the airport, the complainants remembered
the address of Resurrecion Bea and Dionisio Bea, brothers-in-law of Josie Bea. Complainants took a taxi
and proceeded to such address. [17] They found Resurrecion Bea, who did not know anything about
employment for the complainants. The complainants agreed to contribute one hundred dollars ($100)
each for their lodging expenses while waiting for the promised employment. [18]
After several days and realizing that there was no work for them in Malaysia, Rizalina Belbes, Wilfredo
Belbes and Ermelita Bocato returned to the Philippines on September 30, 1993.[19] Alan Banico and Arnel
Basaysay followed suit on October 2, 1993. [20]
The complainants claimed that their lives were endangered because they were stranded in a foreign
country without a place to stay or any means of subsistence. They also suffered embarrassment and
humiliation. [21] The complainants confronted the three accused, who promised to refund the money.Later,
however, the accused challenged complainants to file a case. [22]
Accused Lorna Guevarra, on the other hand, insisted that she was merely a housewife with three children,
not a recruiter. She testified that sometime before August 23, 1993, Ermelita Bocato and Rizalina Belbes
went to her house in order to ask how her brothers, Resurreccion and Dionisio Bea, and niece Maricel
Bermillo, who were working in Malaysia, were able to go abroad. Guevarra told Ermelita and Rizalina that
her brothers were assisted by an agency and that they should go to Manila to look for that agency. Since
that time, Guevarra did not see Ermelita Bocato. Rizalina Belbes, however, insisted that she be
accompanied to the house of Josie Bea, who financed the overseas trip.
On August 23, 1993, Guevarra escorted Rizalina to the house of Josie Bea. Guevarra later learned that
Rizalina and Ermelita returned to the house of Josie Bea several times. [23]
Guevarra denied recruiting the complainants or collecting any amount from them. [24] She claimed thatshe
did not know Ermelita Bocato, Arnel Basaysay or Alan Banico before August 1993, although she admitted
knowing Rizalina Belbes, a businesswoman in her barangay, and Gloria Banico, a worker at the barangay
health center. [25]
Accused Josie Bea likewise denied having recruited any of the complainants to work abroad, saying that
she was engaged in the manufacture of abaca slippers while her husband, Pedro Bea, Jr., was a jeepney
driver.[26]
Josie testified that on August 23, 1993, accused Lorna Guevarra, accompanied by Ermelita Bocato and
Rizalina Belbes, visited her. Josie did not know why Ermelita and Rizalina were with Guevarra.[27] Four days
later, Rizalina and Ermelita returned and asked her how her brother-in-law Resureccion Bea was able to
go to Malaysia. She told them that it was through a travel agency. When they asked to be accompanied
there, Josie refused because she had just delivered a child a few days earlier, and needed to rest. [28]
On September 15, 1993, Rizalina Belbes and Ermelita Bocato returned and insisted that Josie Bea
accompany them. Due to their persistence, Josie finally agreed. They left for Manila that afternoon and
arrived in the morning of the next day. Josie brought them to a certain George Serrano of Travel Orient
Agency in San Juan, Manila. There, Ermelita and Rizalina bought plane tickets for Malaysia. Josie went
home that same day. [29]
Josie testified further that on October 9, 1993, Rizalina Belbes came back to the Philippines from Malaysia
and visited her. Rizalina mentioned that she found a buyer of abaca products in Malaysia and showed Josie
some pictures and calling cards. [30]
40
Pedro Bea, Jr. denied involvement in any recruitment activity and alleged that he was driving on the
Legaspi-Tabaco route from July 1993 to October 1993. [31]
Pedro testified that on September 15, 1993, he did not find his wife Josie at home and learned that she
went to Manila. When Josie came back on September 17, 1993, she told Pedro that she took care of some
papers because she wanted to go back to her former job as seamstress in a tailor shop. [32]
In this appeal, the three accused-appellants alleged that they neither recruited nor received any payment
from any of the complainants. They denied even knowing the complainants before the filing of the
case. They also maintained that the lower court erred in finding the existence of conspiracy, and qualifying
the illegal recruitment to one committed by a syndicate or in large scale.
The appeal lacks merit.
Under the Labor Code, recruitment and placement refer to any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or
advertising for employment, locally or abroad, whether for profit or not: Provided, [t]hat any person or
entity which, in any manner, offers or promises for a fee employment to two or more persons shall be
deemed engaged in recruitment and placement. [33]
Recruitment for overseas employment is not in itself necessarily immoral or unlawful. It is the lack of the
necessary license or permit, or the engagement of prohibited activities enumerated in the Labor Code that
render such recruitment activities unlawful or criminal. [34] Illegal recruitment is qualified into large scale
recruitment when three or more persons are victimized. If such recruitment is carried out by a group of
three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful
or illegal transaction, enterprise or scheme, it becomes one committed by a syndicate. Illegal recruitment
committed by a syndicate or in large scale amounts to an offense involving economic sabotage, punishable
by life imprisonment and a fine of one hundred thousand pesos (P100,000.00). [35]
In this case, Lorna Guevarra and Josie Bea were neither licensed nor authorized by the Department of
Labor and Employment and the Philippine Overseas Employment Administration to recruit workers for
overseas employment. [36] Pedro Bea Jr. had no such authority or license.
Complainants in this case comprise five persons, or more than the minimum number of persons required
by law to constitute illegal recruitment in large scale.
The question now is whether or not appellants engaged in recruitment activities.
Complainant Rizalina Belbes testified as follows:
Q Do you remember having met this Lorna B. Guevarra prior to your departure from Kuala Lumpur?
A From what I remember she first came to our house on August 23, 1993.
xxx xxx xxx
She started convincing me to work in Malaysia because she said she has job placements abroad.
Q Relying on the alleged promise of a very lucrative job at Kuala Lumpur by Lorna Guevarra who initially
saw you on August 23, what else happened?
 41

A For several times that she came to our house, she accompanied me to the house of her brother Pedro
Bea and his wife Josie Bea.
xxx xxx xxx
When we arrived there Lorna Guevarra informed the two of them saying that these are the persons whom
I convinced to work abroad, and in fact, the three of them started convincing us more and asked us on
what country we would like to work. [37]
Q After you were convinced by these three accused and finally decided to go to Malaysia for a very
attractive job or employment, did you ask them what will be your obligation to them for this favor they
were affording to you?
A The accused told me that I should give them thirty thousand pesos (P30,000.00) for this job
opportunity. [40]
Alan Banico also testified in the following manner, to wit:

Wilfredo Belbes corroborated his sisters testimony in the following manner, to wit: Q Do you know Lorna Guevarra?

Q What convinced you to work abroad? A Yes sir.

A I was convinced to work abroad because Lorna Guevarra told me that she has the capability of sending
workers abroad; and that her connection was on direct hiring basis; that for the first three months period
I will be receiving P9,000.00 pesos and that after three months period I will be receiving P12,000.00
pesos. So being apoor man I accepted the offer because I wanted to give my family more benefits. [38]
xxx xxx xxx
Q It was your sister Sally Belbes who allegedly paid the P30,000.00 is that correct?
xxx xxx xxx
She went to our house and told me about her business of sending workers in Malaysia, sir.
Q When she talked that matter with you, what else did she tell you?
A She told me to go with those whom they were going to send to work in Malaysia. She also told me that
we were going to have a very good job in Malaysia; that I would be receiving a high salary.

A Yes sir. xxx xxx xxx

Q Were you aware to whom did your sister pay that amount? Q After you have talked with your mother about this matter, did you again see this Lorna Guevarra
subsequent to that meeting of yours?
A To Josie Bea and Pedro Bea, Jr. sir.
A Yes sir because she had been coming back to our house and trying to convince me to go abroad.
Q Were you around when the amount was paid?
Q This Lorna Guevarra in her going to your house, was there any other person who helped her convince
A Yes sir.[39] you?

Ermelita Bocato, for her part, testified as follows: A She went to our house with Josie Bea, sir.

Q In connection with your complaint, do you remember when for the first time have you met Lorna xxx xxx xxx
Guevarra?
Lorna Guevarra said that Josie Bea is the one sending workers abroad.
A I already knew her because she is my barrio mate and she came to me for the first time regarding this
job opportunity at Kuala Lumpur on August 23, 1993 and told me they have connections in Malaysia and Q It was not Lorna Guevarra?
her hiring is direct employment and it is a very good opportunity in Malaysia.
A Including her, sir.
xxx xxx xxx
xxx xxx xxx
A During the first time that she came to me and told me the job opportunity I was not convinced yet
Q Did you acceed to their proposal to join the other persons whom they have recruited to go to Malaysia?
because I was then having seven children and the youngest who was only seven months old because of
this I did not want to leave them but because of her explanation (Lorna Guevarra) that they were hiring A Yes, I acceeded to their promised job. [41]
employees direct employees board and lodging free I was convinced to go to Malaysia.
Arnel Basaysay testified as follows:
xxx xxx xxx
Q How were you able to go to Kuala Lumpur, Malaysia on September 25, 1993?
A I was taken by Lorna Guevarra to the house of Josie Bea and Pedro Bea, Jr. in Bonga, Bacaycay, Albay.
A I was recruited.
xxx xxx xxx
 42

Q By whom? The credibility of witnesses is best left to the judgment of the trial judge whose findings are generally not
disturbed on appeal, absent any showing that substantial errors were committed or that determinative
A Lorna Guevarra, Josie Bea and Pedro Bea, Jr. facts were overlooked which, if appreciated, would call for a different conclusion.[45] The trial court has the
advantage, not available to appellate courts, of observing the deportment of witnesses and their manner
xxx xxx xxx
of testifying during the trial. Thus, appellate courts accord high respect to the findings and conclusions of
Q will you kindly tell us how these three (3) people were able to recruit you? lower courts. [46]

A Lorna Guevarra came to our house sir. Moreover, there is no showing that any of the complainants had ill-motives to testify falsely against
accused-appellants and to impute such serious charges. Accused-appellants have not disputed the fact
xxx xxx xxx that they have had no previous quarrel with any of the complainants. The rule is established that it is
against human nature and experience for strangers to conspire and accuse another stranger of a most
She was convincing me to go abroad sir. serious crime just to mollify their hurt feelings.[47]

xxx xxx xxx Aside from exacting hard-earned money from the complainants, the accused-appellants even permitted
the complainants to go to another country without a place to stay or any means of subsistence. No
Q what else did Lorna Guevarra tell you?
explanation was given to the complainants as to why the alleged employer failed to appear at the
A She told me for the first three (3) months our salary would be P9,000.00 and after three (3) months it will airport. In fact, instead of sympathizing with the complainants because of their misfortune, the accused-
be increased. appellants even challenged complainants to file a case in court.

xxx xxx xxx The accused-appellants have conspired to recruit complainants without the necessary permit or license
and victimized more than three persons in the case at bar. Thus, they are guilty of illegal recruitmentby a
Q Is Lorna Guevarra alone in her succeeding return trips to your house at San Andres, Sto. Domingo, Albay? syndicate in large scale and must suffer the consequences thereof.

A She was with Josie Bea sir. IN VIEW WHEREOF, the Court hereby AFFIRMS the appealed decision in toto. With costs.

xxx xxx xxx SO ORDERED.

Q Did you know as to how much did they demand for the favor they are extending to you?

A P30,000.00 sir. [42]

As can be seen from the testimonies of the witnesses, the accused -appellants committed acts of
recruitment such as promises of profitable employment to complainants and acceptance of placement
fees. Such acts fall squarely within the definition of recruitment and placement under the Labor
Code. With the certification from the Department of Labor and Employment stating that appellants were
not authorized to recruit workers for overseas employment, it is clear that the offense committedagainst
the five complainants is illegal recruitment in large scale. [43]

The accused-appellants asserted that the offense should not have been qualified into illegal recruitment
by a syndicate since there was no proof that they acted in conspiracy with one another. However,the acts
of accused-appellants showed unity of purpose. Guevarra would visit each of the complainants in their
houses for several times, convincing them to
work abroad, and giving them the impression that she had the capability of sending them abroad. She
would accompany them to the house of the spouses Bea, who, in turn, would collect the placement fees
and process the passports and plane tickets. All these acts of the appellants established a common criminal
design mutually deliberated upon and accomplished through coordinated moves.

As against the evidence built by the prosecution, the accused-appellants merely raised the defense of
denial. However, denials, if unsubstantiated by clear and convincing evidence, are deemed negative and
self-serving evidence unworthy of credence. They have no evidentiary value when ranged against the
testimonies of credible witnesses on affirmative matters. [44]

[G.R. Nos. 137370-71. September 29, 2003]
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. SPO1 ARMANDO LOZANO @ AMID, (acquitted) DAVE
SAMSON, (acquitted) EUTIQUIANO PACAA, JR., @ TOKING PACAA, (acquitted) and RAUL OCO @ BOY
USHER, accused,
RAUL OCO @ BOY USHER, appellant.
D E C I S I ON
PUNO, J.:
This is an Automatic Review of the Decision[1] of the Regional Trial Court of Cebu City, Branch 7, in Criminal
Cases Nos. CBU- 46172-73 finding appellant Raul Boy Usher Oco guilty beyond reasonable doubt of the
crimes of murder and frustrated murder, and imposing the supreme penalty of death. The antecedent
facts are as follows:
On January 19, 1998, the appellant, together with Armando Amid Lozano, Dave Samson and
Eutiquiano [2] Toking Pacaa, Jr. were charged with murder and frustrated murder in the Regional Trial Court
of Cebu City, Branch 7. The Information for murder reads as follows:
That on or about the 24th day of November, 1997 at about 9:30 oclock in the evening, in the City of Cebu,
Philippines, and within the jurisdiction of this Honorable Court, the said accused, riding on two
motorcycles, conniving andconfederating together and mutually helping one another,together withPeter
Doe, John Doe and Jane Doe, whose cases will be separately considered as soon as procedural
requirements are complied with, armed with unlicensed firearms, did then and there willfully, unlawfully
and feloniously, with intent to kill, and with treachery and evident premeditation and abuse of superior
strength, attack, assault and use personal violence upon oneAlden Abiabi by shooting him with the use
of said unlicensed firearms, hitting him on the different parts of his body, thereby inflicting upon the latter
mortal wounds which were the direct and immediate cause of his death thereafter.
CONTRARY TO LAW. [3]
The Information for the frustrated murder case reads:
That on or about the 24 th day of November, 1997, at about 9:30 oclock in the evening, in the City of Cebu,
Philippines, and within the jurisdiction of this Honorable Court, the said accused, riding on two
motorcycles, conniving andconfederating together and mutually helping one another,together withPeter
Doe, John Doe and Jane Doe, whose cases will be separately considered as soon as procedural
requirements are complied with, armed with unlicensed fi rearms, with deliberate intent, with intent to
kill, with treachery and evident premeditation and grave abuse of superior strength, did then andthere
suddenly attack, assault and use, personal violence upon the person of one Herminigildo Damuag by
shooting him with the use of said unlicensed firearms, hitting him on the different vital parts of his body,
thereby inflicting upon said Herminigildo Damuag serious physical injuries, which injuries under ordinary
circumstances would cause the death of the victim, thus performing all the acts of execution whichwould
have produced the crime of Murder as a consequence, but which nevertheless didnot produce it by reason
of causes independent of the will of the herein accused, that is, by the timely and able medical assistance
rendered to said Herminigildo Damuag which prevented his death.
CONTRARY TO LAW. [4]
43
Forthwith, the trial court issued a warrant for the arrest of the appellant and his co-accused. On January
20, 1998, upon learning of the issuance of the warrant for his arrest, accused PO2 Armando Lozano turned
himself to the authorities and filed an Urgent Motion [5] praying that he be detained at the PNP Jail in Camp
Sotero Cabahug, Gorordo Avenue, Cebu City. He feared that he might be a victim of reprisal and vengeance
in Bagong Buhay Rehabilitation Center (BBRC) since many of the persons he has arrested as a police officer
were detained in the facility. On January 21, 1998, appellant Raul Oco surrendered to the authorities and
filed an Urgent Motion [6] praying similar relief sought by accused Lozano. Police Senior Inspector Pablo
Gayacan Labra II returned to the court the unserved warrants. [7]
In the afternoon of January 21, 1998, Judge Martin A. Ocampo issued an Order [8] acting favorably on the
requestof the appellantandhis co-accused to be detained atCampSotero Cabahug insteadof at the BBRC.
Accused Dave Samson was arrested that same day, [9] while accused Eutiquiano Pacaa voluntarily
surrendered to the police authorities on January 26, 1998. [10]
On January 29, 1998, Judge Martin issued an Omnibus Order [11] directing the detention of all accused at
the BBRC for the duration of the trial. That same day, the appellant and his co-accused were arraigned in
both cases. Assisted by their respective counsels, all of them entered a plea of not guilty to both
charges.[12] The cases were tried jointly pursuant to Rule 119, sec. 14 of the Rules on Criminal Procedure.
During the trial, the prosecution presented twelve (12) witnesses while the defense presented thirty-one
(31) witnesses.
Surviving victim Herminigildo Damuag testified that at around 9:30 p.m. of November 24, 1997, he was
driving his motorcycle (referred to as the first motorcycle in the Records) along V. Rama Avenue, Cebu City
with the late Alden Abiabi riding with him at the back. When they reached the vicinity of Pica Lumber, a
white Tamaraw FX AUV overtook their motorcycle (first motorcycle) and blocked their path, forcing him
to slow down.[13] Another motorcycle (second motorcycle), with two (2) riders on it, appeared behind the
first motorcycle. From a distance of about two (2) to three (3) meters, one of the riders of the second
motorcycle suddenly fired two (2) shots in close succession. Damuag attempted to look at the tires of his
motorcycle, thinking that they have exploded. Suddenly, Abiabi pushed him with his body. Abiabi fell from
the first motorcycle and slumped on the pavement face down. The Tamaraw FX AUV sped away. [14]
As Damuag was trying to control his motorcycle, he noticed another motorcycle (third motorcycle) passed
by from behind him. His motorcycle zigzagged towards the gutter. Damuag was thrown off and hit the
ground. He stood up and realized that he was hit at the right side of his body. He then heard a burst of
gunfire from behind. [15]
Damuag saw the third motorcycle at about two (2) to three (3) meters. It was on a stop. Appellant was at
the back of the third motorcycle, holding a short firearm in his right hand. Appellant fired his gun athim
but missed. Although wounded, Damuag was able to run. However, the third motorcycle chased
him. Upon reaching the vicinity of Five Brothers restaurant, Damuag stopped because he could not pass
anymore. From a distance of about four (4) to five (5) meters, the appellant again fired two (2) more shots
at Damuag.[16] The third motorcycle sped away towards B. Rodriguez Street.[17] Damuag was initially rushed
to the Southern Islands Hospital. About three (3) hours later, his wife brought him to the Sacred Heart
Hospital. He survived the attack due to the timely medical attention given to him at the latter hospital. [18]
The attending physician, Dr. Dale Pasco, testified that when Damuag was brought to the hospital, the
latter was bleeding profusely from the four (4) gunshot wounds at his back, two (2), at the side of his chest,

and one (1), at the abdominal area. Damuag was immediately operated on.The doctor opined that without
the surgery, Damuag would have died due to the gunshot wounds he sustained. [19]
Damuag was confined at the Sacred Heart Hospital from November 25, 1997 to December 10,
1997.[20] Subsequently, he was moved to CIG hospital.His hospitalization bills allegedly amounted
to P160,000.00.[21] He likewise spent five thousand pesos (P 5,000.00) for medicines after having been
discharged from the hospital. Prior to the shooting incident, he was earning P 150.00 a day as a driver of
Marilou Aznar. The incident made him feel fearful for his life. [22]
Alden Abiabi did not survive the ambush. He sustained eight (8) gunshot wounds on the different parts of
his body. Dr. Jesus P. Cerna testified that a bullet was deeply embedded in Abiabis thoracic vertebrae and
had not been retrieved despite diligent efforts to extract the same. Necropsy Report No. N-97-191
revealed that he died due to shock, secondary to multiple gunshot wounds, face, body and
extremities. [23] At the time of his death, Abiabi was working as a legal researcher at Clear, Inc., with a
monthly income of P 8,000.00.[24] Mrs. Amelia Abiabi testified that she spent a total of P 250,000.00 for
funeral services; P 50,000.00 of which was spent for the coffin alone. [25]
Damuag testified that he did not recognize the driver and the passenger of the second motorcycle and the
driver of the third motorcycle because they were wearing their helmets. [26] He, however, recognizedthe
appellant as one of the triggermen because the appellant was not wearing helmet at the time of the
shooting incident. Instead, he had a towel tied around his forehead. The appellant was wearing a
sleeveless undershirt (sando) and maongshort pants. [27]
Ronald Barellano, a sixteen-year (16) old candle and flower vendor, corroborated Damuags identification
of the appellant as the second gunman. He testified that on the night of the shooting incident, he was in
the company of eight other (8) children, [28] including another eyewitness, 14-year old Salem
Tenebroso. They were buying barbeque in a store across the cemetery when a blue colored motorcycle
(first motorcycle) driven by Herminigildo Damuag, with Alden Abiabi as a backrider, passed by
them. Suddenly, a white Tamaraw FX blocked the first motorcycle, causing it to reduce its speed. Then, a
black-colored motorcycle (second motorcycle) passed from behind the first motorcycle, and its backrider
fired two shots at Abiabi. Abiabi fell from the motorcycle while Damuag continued driving in a zigzag
manner. Damuag eventually fell to the ground five (5) meters away from Abiabi. [29]
Moments later, another motorcycle (third motorcycle) arrived at the scene. The motorcycle stopped and
its backrider stepped his right foot on the ground. Without alighting from the third motorcycle, the
backrider, whom Barellano recognized as the appellant, fired three (3) successive shots at Abiabi whowas
still sprawled on the ground face down. [30] Damuag tried to get near Abiabi but the appellant also firedat
him. Damuag ran away, but the third motorcycle was able to catch up with him near the Five Brothers
Restaurant. Appellant again shot Damuag twice. The third motorcycle then sped away. [31]
Barellano claimed that when the first shooting occurred, he and his companions walked towards the fallen
Abiabi and stayed at a distance of around four (4) to five (5) meters. Thus, he had a good look at the face
of the appellant when he arrived aboard the third motorcycle and shot Abiabi and
Damuag. [32] Furthermore, the place was illuminated by a lamp post. [33] He recalled that the appellanthad
a towel wrapped around his forehead. [34] He knew the appellant even prior to the shooting incident. He
used to accompany his friend, Salem Tenebroso, whenever the latter would go to the residence of the
appellant to feed the latters roosters. Barellano, however, failed to recognize the three (3) other riders of
the motorcycles because they were wearing helmets. [35] After the shooting incident, people milled atthe
crime scene. Barellano recognized barangay tanods Nato Maraveles and Zaldy Regodo in the crowd. [36]
44
For his part, Magno Ybanez, Jr. claimed that several minutes before the shooting incident, he saw the
appellant and the three (3) accused (Dave Samson, Lorenzo Amid Lozano, and Eutiquiano Toking
Pacaa) beside two (2) motorcycles parked along the sidewalk near the cemetery. At that time, the three
(3) accused were not yet wearing their helmets. At 9:00 p.m., Ybanez, Jr. was walking along V. Rama
Avenue, in front of Pica Lumber, when a motorcycle went past him. Although the two (2) riders were
wearing their helmets, Ybanez, Jr. claimed that accused Samson was driving the second motorcycle, with
accused Lozano as his passenger. Lozano allegedly shot twice at Abiabi, the passenger of the first
motorcycle. Shortly thereafter, the third motorcycle, driven by Pacaa, appeared at the scene and its
passenger, the appellant, fired at Abiabi and Damuag. Pacaa was then wearing his helmet whilethe
appellant only had a towel tied around his forehead. [37]
Virginia Gamboa claimed that she also saw the three (3) accused and the appellant a couple of hours or
so before the shooting incident along V. Rama Avenue. [38] Samson was wearing a black jacket and
a puruntong short pants, Lozano was wearing a white sando and maong pants, while Pacaa was in short
pants and maong jacket. The appellant was in a sleeveless undershirt, with a towel tied around his
forehead.[39] The accused were not yet wearing their helmets. She recognized the three (3) accused and
the appellant because she was only about five (5) to six (6) meters away from them and there was a bright
light coming from the VECO post. She got curious why the accused and the appellant were there but she
shrugged the thought off and went home. [40]
After dinner, Gamboa went out and proceeded towards Pica Lumber. She waited at a nearby store for her
husband to come home from work. She then saw the accused and the appellant near the cemetery. They
drove their motorcycles toward Lucio Drive and came back towards Nadelas compound.Gamboa claimed
she recognized the three (3) accused although they wore their helmets because the front covers of the
helmets were transparent. Samson was driving the motorcycle, with Lozano riding behind him. The
motorcycle driven by Pacaa, with the appellant as passenger, was right behind Samson and Lozanos
motorcycle. They were following the motorcycle of Damuag and Abiabi that was cruising at normal speed
along V. Rama Avenue. [41]
Suddenly, a white Tamaraw FX AUV cut-off Damuags motorcycle. Without much ado, Lozano, then riding
another motorcycle, shot Abiabi twice. The latter fell on the ground. Damuags motorcycle zigzagged and
hit the ground. Lozano and Samson fled on board their motorcycle. The motorcycle of Pacaa and the
appellant stopped near Abiabi who was then sprawled on the ground face down. The appellant fired
several shots at Abiabi. Thereafter, the appellant fired at Damuag while the latter was trying to stand
up. Damuag was hit. He tried to run, but Pacaa and the appellant chased him on board their
motorcycle. The appellant again shot Damuag until he fell on the ground. The appellant and Pacana sped
towards the direction where the other two (2) accused had earlier fled. [42]
Gamboa personally knew the three (3) accused and the appellant even before the shooting
incident. Lozano is known as a policeman in their locality.The appellant, also known as Boy Usher intheir
place, was a barkada of her late husband, Rene Gamboa, while Pacaa is the brother-in-law of her brother-
in-law. She also knew Samson since 1992 as she had seen him in the cockpit when she went there to fetch
her husband. [43]
The prosecution theorized that the shooting incident was drug-related. The late Abiabi was a known anti-
drug advocate while the appellant was a suspected drug lord. The other accused, on the other hand,
allegedly had connections with the drugs trade. [44]
The appellant and his co-accused denied any participation in the shooting incident.

The appellant testified that at the time of the shooting incident, he was inside a chapel in Sambagan.
He claimed that on November 24, 1997, he playedmahjong from 3:00 p.m.- 9:00 p.m. [45] At around 9:00
p.m., he proceeded home to have supper and thereafter, went out to look for his five - year old son. [46]Not
able to find his son, the appellant proceeded to Sambagan to meet Boy Misa and inform the latter thathe
could not lend him some money. On his way to Sambagan, he passed by a sari-sari store in A. Lopez St.
and bought a bottle of Red Bull. The appellant also passed by the Our Lady of Lourdes Chapel. He noticed
that the door was slightly opened so he went in to look at the clothes of the Virgin[47] for he intended to
change the Virgins clothes for the forthcoming fiesta celebration.
Upon entering the chapel, the appellant saw a group of women who informed him that the scheduled
meeting that night in the chapel in connection with the forthcoming fiesta celebration was postponed.He
recognized one of them as the wife of his co-accused Toking Pacaa. Appellant was seated at the cement
floor for a few minutes when he heard an unusual burst. However, he did not bother to investigate the
origin or nature of the unusual burst. He asked some people inside the chapel if they had seen Boy Misa
but none of them did. He went out of the chapel, proceeded to a store across the chapel, and inquired
from a group of persons milling around the store the whereabouts of Misa. Appellant was told thatMisa
was there earlier but had left however, and they did not notice where he went. [48]
The appellant proceeded home and went to bed. His son and daughter soon arrived and slept withhim. A
few minutes later, his wife, along with his sister-in-law and some neighbors, awakened him and toldhim
that his kumpadre and good friend, Alden Abiabi, was shot at V. Rama St. He was shocked upon learning
the information because the victim had no known enemy. [49]
The appellant changed his shirt and went towards Sambagan to inquire about the incident. On his way to
Sambagan, he saw a group of women who told him that his good friend Alden was shot. He met another
group who relayed the same information when he arrived in Sambagan. The appellant proceeded to A.
Lopez and stayed at the barbeque stand until past 2:00 a.m. [50]
The appellant was thus surprised when he learned that he was implicated in the shooting of Alden. He and
Abiabi were good neighbors and friends and he had no motive to kill the victim. He denied that he was a
drug lord. [51] He also said that he was not in good terms with his three co-accused, hence, there was no
basis for the alleged conspiracy. The appellant also charged Magno Ybaez with bias as he was one of the
suspects in the killing of the latters older brother.[52] Lolita Mosqueda,[53] Ernesto Herhuela[54] and Herminia
Ferraren [55] were presented to corroborate appellants defense of alibi.
Accused Armando Lozano, on the other hand, claimed that on November 24, 1997, he was training fighting
cocks in the cockpit arena from 9:00 p.m. until 1:00 a.m. of the next day. Accused Lozanos companions,
Vic Lozano, [56] Prospero Lozano, [57] Ritchie Ho, [58] RamonTabares[59] and BendictoOrge, [60]corroborated his
alibi. Accused Dave Samsonasserted that he was in Larena,Siquijor on the night of November24, 1997. His
alibi was corroborated by Felizardo Balmadres. [61] Accused Eutiquio Toking Pacaa alleged that he was
sleeping at his house at the time of the incident. [62]
The defense also presented Salem Tenebroso, Jr., Patsy Bolls, and PO1 Bienvenido Arlan, Jr. to prove that
none of the alleged eyewitnesses recognized any of the perpetrators of the crime. Tenebroso, 14-year old,
is one of Barellanos companion on the eve of November 24, 1997. Previously, he issued an Affidavit
wherein he identified the appellant as one of the malefactors in the shooting incident. [63] Thereafter, he
executed an Affidavit of Recantation, [64] claiming that he did not recognize any of the perpetrators because
all of them were wearing helmets.Tenebrosotestified in court thatshortly after the incident, he and Junnie
Quigao were brought to the CIG Office at Camp Sotero Cabahug and were interviewed by a policeman.
The two of them told the police officer that they could not recognize the persons who shot Abiabi because
45
they were all wearing helmets. However, they were told by the investigator to state that the appellant was
the one who killed Abiabi. [65]
For her part, Patsy Bolls, a reporter of Sunstar Super Balita Daily, testified that on December 7, 1997, she
interviewed Damuag at the Sacred Heart Hospital where the latter was confined. [66] During the course of
the interview, Damuag told her that he did not see who shot him and Abiabi. [67] The contents of the
interview were printed on the December 8, 1997 issue of the SunStar Super Balita.[68] Bolls further testified
that the interview was witnessed by another reporter, Garry Cabotaje of Sunstar Daily, and photographer
Alex Badayos. [69] Damuags wife, a lady whom she surmised as Damuags neighbor, other patients, and the
policemen guarding Damuag were also inside the room during the interview. [70]
PO1 Arlan, Jr. corroborated Bolls testimony. He told the court that he was inside Damuags room during his
interview. PO1 Arlan, Jr. claims that he heard Damuag telling the reporter that he did not recognize anyof
his assailants. His curiosity was aroused by Damuags answer. So after Bolls interview, he asked Damuag if
the latter really did not recognize who shot him and Abiabi. Damuag confirmed that he did not recognize
any of the assailants. [71]
Teresita Bunal [72] and Eduardo Nabua [73] testified that prosecution witness Virgilia Gamboa was not
present during the shooting incident. Rosalia Ybanez Nadela[74] and Christy Labistre,[75] on the other hand,
contradicted Magno Ybanezs claim that he was within the vicinity of the incident and saw the tragic event.
After the trial, the trial court found the appellant guilty of murder and frustrated murder. The trial court
disregarded Salem Tenebrosos Affidavit of Recantation and gave full credence to his previous Affidavit
identifying the appellant as one of the gunmen. Further, the court doubted the credibility of eyewitnesses
Gamboa and Ybanez, Jr. who claimed to have seen not only the face of the appellant but of his three (3)
co-accused as well. Thus, the appellants co-accused were acquitted. The dispositive portion of the trial
courts Judgment, dated December 16, 1998, provides:
WHEREFORE, this Court hereby makes the following dispositions:
1). In Crim. Case No. CBU-46172: the Court finds accused Raul Oco alias Boy Usher Guilty beyond
reasonable doubt as principal in the crime of Murder defined and penalized by Article 248 of the Revised
Penal Code in relation to Article 7659 and hereby sentences him to Death. Said accused is further ordered
to indemnify the heirs of the deceased Alden Abiabi in the sum of One Million Pesos (P1,000,000.00);
2). In Crim. Case No. CBU-46173: the Court finds accused Raul Oco alias Boy Usher Guilty beyond
reasonable doubt as principal in the crime of Frustrated Murder defined and penalized by Article 248 in
relation to Article 50 of the Revised Penal Code and hereby sentences him to suffer the penalty of Reclusion
Perpetua and to indemnify the victim Herminigildo Damuag in the sum of Five Hundred Thousand Pesos
(P500,000.00);
3). In Crim. Case Nos. CBU-46172 for Murder and CBU-46173 for Frustrated Murder on the ground of
reasonable doubt- accused SPO2 Armando Lozano alias Amid Lozano, Dave Samson, and Eutiquiano Pacaa
alias Toking Pacaa are ACQUITTED-because there is no moral certainty in the unprejudiced mind of this
Court that said three (3) other accused had participated in the commission of the crimes with which they
were charged (Rule 133, Rules of Court).
Costs de officio.
SO ORDERED.
 46

The case is now with this Court for review. Q: You mean before he was shot by Raul Oco you saw somebody else shooting Abiabi while he was riding
at the back of the motorcycle?
The appellant insists that he has no motive to kill Abiabi, a known anti-drug advocate, because he is not a
drug lord as the prosecution depicted him to be during trial. [76] In fact, Mrs. Abiabi admitted during trial WITNESS:
that she has a debt of gratitude to the appellant as the latter lent her some money in the
past.[77]Furthermore, Damuag is his close friend and he has no reason to injure. [78] A: I saw when he was shot.

The appellant also assails that his identification as one of the assailants of Abiabi and Damuag is Q: You actually saw Abiabi being shot while he was still riding on a motorcycle?
incredulous because it is against human experience for an assassin to kill without covering his face to
A: Yes, Your Honor.
prevent his identification. He claims that the fact that his co-accused used helmets to hide their identities
would make it more logical for him to use also a helmet while shooting at Abiabi and Damuag in plain view Q: And you saw him fell down with (sic) the motorcycle as a result of the shooting?
of many witnesses. [79] The appellant insists on his alibi that he was inside a chapel in Sambagan, Cebu City,
while the shooting incident was in progress. A: Yes, Your Honor.

We affirm the judgment of conviction. Q: Who shot him?

Motive is not an essential element of a crime, and hence, need not be proved for purposes of A: I do not know the person, Your Honor.
conviction.[80] Standing alone, the failure of the prosecution to adduce proof of the appellants motive to
kill Abiabi and injure Damuag would not exculpate him, especially since he was positively identifiedby at Q: Where was he located, the person who first shot Abiabi?
least two credible witnesses as one of the assailants.
A: The person was backriding on a motorcycle.
To be sure, the fact that the appellants companions wore helmets does not make his identification by the
Q: There were two (2) persons on that motorcycle?
eyewitnesses incredulous. We agree with the Solicitor Generals observation that criminals carry outtheir
criminal designs differently. Some cover their faces, but others boldly perform their criminal acts in full A: Yes, Your Honor.
view of the public. The records show that appellant belongs to the latter category.
Q: You said you saw Raul Oco in (sic) that crime scene. When did you first see Raul Oco? When he was still
Ronald Barellano gave a detailed account of the incident, and emphatically claimed that he saw the riding on a motorcycle?
appellant when he shot Abiabi, viz:
A: I saw Raul Oco at the time he shot (Abiabi).
ATTY. SENO:
Q: You did not see him riding a motorcycle before the shooting?
Q: In other words, Master Barellano, when you turned your eyes towards where Abiabi was, the firsttwo
(2) shots which you heard were already fired? A: No, Your Honor.

WITNESS: Q: You never saw him riding a motorcycle before the shooting started or before you saw him shooting
Abiabi?
A: Yes, sir.
A: While Raul Oco was riding a motorcycle I did not see his face. I saw his face at the time he shot Abiabi.
Q: And what you saw when you turned your eyes towards where the two (2) shots, the first two (2) shots
were fired, was Abiabi who fell on the ground? Q: You saw his face at the time he shot Abiabi?

A: Yes, sir. A: Yes, Your Honor.

Q: In other words, you did not witness the actual firing of the first two (2) shots. Is that correct? Q: Did you see Raul Oco while he was still riding a motorcycle before the shooting or before he shotAbiabi?

WITNESS: A: Yes, Your Honor.

A: I saw when he was shot twice. Q: Did you see his face while he was seated in the motorcycle?

COURT TO WITNESS: A: No, Your Honor, I did not see his face.

Q: How did you know that it was Raul Oco if you did not see his face?
 47

A: When the motorcycle stopped and he stepped his right foot on the ground and shot I saw his face. Q: Did he fire another shot at you afterwards?

Q: So, that was the only time that the person you saw riding that motorcycle before was Raul Oco? A: At the time I ran away he fired another shot, Your Honor.

A: Yes, Your Honor. Q: And that second shot hit you?

Q: Because the person you saw riding in (sic) the motorcycle have (sic) the same clothes as Raul Oco when A: No, Your Honor.
he was shooting Abiabi?
Q: So, you glanced back and saw the accused Raul Oco in between the first and the second shot. Is that
A: Yes, Your Honor. correct?

Q: And you saw that person riding the motorcycle wearing that towel around his head that you described A: When I stood up after I was slumped I saw Raul Oco, Your Honor.
before?
Q: I thought you said you glanced back after you were hit by the first shot. You did not. So when youwere
A: Yes, Your Honor. [81] hit by the first shot, did you glance back immediately at Raul Oco?

Barellanos testimony on how the appellant shot Damuag is equally clear. His testimony reads as follows: A: I saw Raul Oco, Your Honor.

COURT: Q: After you were hit?

So let us ask him again A: Yes, Your Honor. [82]

Q: Do you mean that Raul Oco, when you saw him shooting Abiabi, was still on the top of the motorcycle? The appellants identity as one of the assailants became even more apparent after a series of clarificatory
questions propounded by Judge Ocampo on Damuag, to wit:
A: Yes, Your Honor.
COURT:
ATTY. SENO:
Q: Alright lets ask him again for the last time. Were you hit by the first shot?
Q: So, after that person who fired the three (3) successive shots space(d) at less than a second from each
other completely fired the three (3) shots, he sat back straight on the motorcycle and sped away? Is that WITNESS:
not correct?
A: At the time when my motorcycle was in a zigzag manner I was already hit, Your Honor.
A: No, sir.
Q: Did you see who fired that shot at you that hit you?
Q: What did he do?
A: No, Your Honor.
A: He still shot Damuag.
Q: You did not. So after you were hit you immediately glanced back and saw Raul Oco?
Damuags testimony identifying Raul Oco as his gunman was unequivocal, direct and leaves no room for
doubt. He related in open court how he was able to identify the appellant that tragic night, thus: A: When my motorcycle was in a zigzag manner I slumped to the gutter then stood up and I saw Raul Oco.

COURT TO WITNESS: Q: You saw him after you were hit by the first shot?

Q: Alright that first shot that hit you, did you glance back already and saw Raul Oco immediately after you A: Yes, Your Honor.
were hit?
Q: So that is very clear- he saw Raul Oco when he glanced back after he was hit by the first shot. So what
WITNESS: happened? Did he shoot you again?

A: I saw him and I face (sic) him. A: Yes, Your Honor.

Q: You saw him immediately after the first shot was fired that hit you? Q: You saw him shooting at you?

A: Yes, Your Honor. A: Yes, Your Honor?

 48

Q: You actually saw Raul Oco shooting at you the second shot he fired? We stress the rule that findings of the trial court on the credibility of witnesses must be respected and not
disturbed on appeal, unless there is a compelling reason to revise them. The trial court is in the best
A: Yes, Your Honor. position to calibrate the credibility of the eyewitnesses, having seen and heard them testify in court as
they recount events that took place that fateful evening.[85]
Q: But that second shot did not hit you?
We see no reason to deviate from this rule.
A: Yes, Your Honor, I was not hit.
It is to be noted that Damuag is not just an ordinary eyewitness. He is a survivor of that tragic incident. His
Q: And then you ran away?
identification of his attacker deserves full credit. It is the natural reaction of victims of criminal violence to
A: Yes, I ran away, Your Honor. strive to see the looks and faces of their assailants and observe the manner in which the crime was
committed. Most often, the face of the assailant and the body movements create lasting impressionthat
Q: And you suffered three (3) other gunshot wounds. Is that correct? cannot be easily erased from their memory.[86] The Court finds Damuags testimony credible as it is replete
with details and corroborated on material points by Ronald Barellano, also a credible witness. These two
A: Yes, Your Honor. eyewitnesses had no ulterior motive to be untruthful in their identification of appellant as one of the
culprits. Where there is nothing to indicate that a witness was actuated by improper motive, his positive
Q: Did you see actually Raul Oco fire those three (3) other shots at you?
identification and categorical declarations on the witness stand under solemn oath deserve full faith and
A: Yes, Your Honor. credence. [87]

Q: So you actually saw him shooting at you those three (3) shots? The failure of Damuag to reveal the identity of his assailants shortly after the shooting incident does not
taint his credibility. He was in critical condition when rushed to the Sacred Heart Hospital. Dr. Dale Pasco
A: Yes, Your Honor. [83] opined that Damuag wouldhave died due to the wounds he sustainedif he were not immediately operated
on. He was placed in the intensive care unit (ICU) until November 30, 1997 and stayed at the hospital until
Despite the cross-examination by the defense counsel, Damuag was unmoved. He firmly asserted that December 10, 1997 without adequate s ecurity.
notwithstanding the wounds he sustained from the first shot, he glanced back and saw appellant Ocofire
his gun at him. In her testimony, Patsy Bolls revealed that on December 7, 1997, she was sent by her editor to verify
Congressman Cuencos complaint that there were no policemen guarding Damuag at the Sacred Heart
ATTY. BRAGAT: Hospital. She interviewed some people and was able to verify the complaint, thus:

Q: After the shot that did not hit you, your instinct was to run away with all immediacy because you feared
for your life. Correct? Having been wounded earlier?
A: Yes, sir.
Q: And you are telling the Honorable Court that while running away for fear of (sic) your life you still turned
your back to see what was at your back so that you could see Oco firing those three (3) shots hitting you?
Q: Why did you go to that hospital?
A: Because earlier Congressman Cuenco called the police informing us that nobody, no policeman was
guarding Damuag in his room and we were assigned by our Editor-in-Chief, Atty. Seares to see and for us
to confirm how true the information of Cong. Cuenco (is).
Q: Were you able to interview the police officers?

A: I did not run fast because I was already hit. A: Yes sir, I asked them how true (is) the allegation that earlier on the day there were no policemen
assigned there to guard Damuag.
COURT:
Q: And what was the answer of the police officers?
That does not answer the question.
A: They said it was true because the duty in the hospital was from 8:00 to 4:00; 4:00 to 12:00; 12:00 to
WITNESS:
8:00. So those policemen- when we went there those policemen were assigned on the 4:00 to 12:00
Yes, sir, I saw Raul Oco. shifting. So it was true that there were no policemen assigned during the 8:00 to 4:00 shifting.

COURT TO WITNESS: Q: Were there other matters that you interviewed the police about?

Q: So inspite of the three (3) hits you still looked at? (sic) A: Actually, I did not interview the policemen, it was them who divulged the information that earlier a
certainJunjun, brother of Abiabi went to see and almost he made a scene in the roomandalmost according
A: Yes, Your Honor. [84] to the policemen almost choke him but I didntit was alleged that was their statement and it was confirmed

by Damuag and his wife that it was true because this certain Junjun was really angry with Damuag thinking
that Damuag was part of the crime. [88]
PO1 Bienvenido Arlan, Jr. also admitted before the court that there was no one guarding Damuag in the
morning of December 7, 1997. He also testified that Damuags life was in danger, viz:
COURT TO WITNESS
Q: How did you come to know that the person you are going to guard is one of the victims in the shooting
incident?
A: Your Honor, when we were ordered by Sinugbuhan to guard Damuag, we were also informed that
Damuag was one of the victims and his life is (sic) in danger.
Q: Did you know or come to know why nobody was guarding Damuag prior to your s hift?
A: I do (sic) not know, Your Honor.
Q: But those police officers in that shift failed to appear?
A: Yes, Your Honor.
(PROS. GALANIDA)
Q: Did you come to know who were those tasked to guard Damuag before your shift at 4:00 oclock of
December 7?
A: Yes, mam, it was PO3 Teves and PO1 Baquerquer.
Q: They were not there in their post? Correct?
A: Yes, mam.
Q: Did you come to know what happened to them?
A: No, mam.
Q: You did not hear that they were sanctioned or what?
A: They were sanctioned, mam. Teves is now in the Detachment of Cebu City Mobile Group and
Baquerquer is now in Sta. Catalina, Negros Oriental. [89]
Given the circumstances, it is but natural for Damuag not to disclose the identity of his assailants. Itwould
be unfair to expectDamuag, a surviving witness to a tragic incident, to further expose himself to the danger
possibly accompanying his revelation of the appellants identity.
As against his positive identification by the prosecution witnesses, the appellants alibi is worthless. For
alibi to prosper, the requirements of time and distance must be strictly met. It is not enough to prove that
the accused was somewhere else when the crime was committed; he must also demonstrate by clear and
convincing evidence that it was physically impossible for him to be at the scene of the crime during its
commission.[90] Ferraren, whoallegedly saw the appellant atthe chapel at the time of the shooting incident
testified that the distance between the chapel and the crime scene can be negotiated on foot withinfive
49
minutes. [91] Given this distance, it is not impossible for appellant to be at the scene when the crime was
committed.
That the other accused were acquitted does not necessarily mean that the appellant likewise deserves an
acquittal. Accused Lozano, Pacaa and Samson were acquitted based on reasonable doubt as to their
identity. This does not negate the trial courts findings on the existence of the acts constituting the crimes
alleged in the Informations. In any event, appellants conviction does not only result from the trial courts
finding of conspiracy but from his own act of shooting Abiabi and Damuag.
We come now to the proper designation of the crimes committed by the accused and the corresponding
penalties for these crimes.
We agree with the trial court that treachery attended the killing of Abiabi and the wounding of Damuag.
There is treachery when the offender commits any of the crimes against the person, employing means,
methods or forms in the execution thereof which tend directly and specially to insure its execution,
without risk to himself arising from the defense which the offended party might take. [92] For treachery to
exist, two conditions must be found: (1) that at the time of the attack, the victim was not in a position to
defend himself; and (2) the offender consciously adopted the particular means, method or form of attack
employed by him.[93] In the case at bar, the motorcycle driven by Damuag (first motorcycle) was suddenly
blocked by a white Tamaraw FX. Without any warning, the backrider of the second motorcycle, coming
from behind, suddenly fired successive shots at Damuag and Abiabi. While Abiabi was helplessly laid at the
pavement face down due to the wounds he sustained, appellant mercilessly shot at him. On the other
hand, Damuag, already wounded, tried to escape but appellant pursued him and shot at him three more
times. The unexpected and sudden attack on the victims, rendering them unable and unprepared to
defend themselves, such suddenness having been meant to ensure the safety of the gunman as well as
the success of the attack clearly constitutes alevosia.[94]
The trial court also found that the offenses were committed with abu se of superior strength. The
malefactors not only outnumbered the victims; at least two of them were armed. More, the circumstances
clearly show that the assailants deliberately took advantage of their combined strength in order to
consummate the crime. Nevertheless, the aggravating circumstance of abuse of superior strength is
absorbed by treachery. [95]
We also agree with the trial court that the generic a ggravating circumstance of use of motor vehicle is
present. The appellant and his companions used motor bicycles in going to the place of the crime, in
carrying away the effects thereof, and in facilitating their escape.
We do not agree with the trial court, however, in its appreciation of the aggravating circumstance of
nighttime. This circumstance is considered aggravating only when it facilitated the commission of the
crime, or was especially sought or taken advantage of by the accused for the purpose of impunity.The
essence of this aggravating circumstance is the obscuridad afforded by, and not merely the chronological
onset of, nighttime.[96] Although the offense was committed at night, nocturnity does not become a
modifying factor when the place is adequately lighted, and thus could no longer insure the offenders
immunity from identification or capture.[97] In this case at bar, a lamp post illuminated the scene of the
crime.
Likewise, we find that the offenses were not committed by a band. A crime is deemed to have been
committed by a band or en cuadrilla when more than three armed malefactors take part in its
commission.[98] The four armed persons contemplated in this circumstance must all be principals by direct
participation who acted together in the execution of the acts constituting the crime. The Code does not

define or require any particular arms or weapons; any weapon which by reason of its intrinsic nature or
the purpose for which it was made or used by the accused, is capable of inflicting serious or fatal injuries
upon the victim of the crime may be considered as arms for purposes of the law on cuadrilla. In the case
at bar, the prosecution alleged that the accused and his three other co-conspirators used unlicensed
firearms in the perpetration of the offenses. However,the evidence on record shows that only two of them
carried firearms. En cuadrilla, as an aggravating circumstance, cannot therefore be appreciated.
There was also no evidence presented to show that the offenses were committed with the aid of armed
men. Aid of armed men or persons affording immunity requires that the armed men are accomplices who
take part in minor capacity, directly or indirectly. [99] We note that all four accused were charged as
principal. The remaining suspects --- John Doe, Jane Doe and Peter Doe--- were never identified and
charged. Neither was proof adduced as to the nature of their participation.
There was also a paucity of proof to show that evident premeditation attended the commission of the
crimes. For this circumstance to be appreciated, there must be proof, as clear as that of the killing,of the
following elements: (1) the time when the offender determined to commit the crime; (2) an act indicating
that he clung to his determination; and (3) sufficient lapse of time between determination and execution
to allow himself time to reflect upon the consequences of his act.[100] Evident premeditation must be based
on external facts which are evident, not merely suspected, which indicate deliberate planning. There must
be direct evidence showing a plan or preparation to kill, or proof that the accused meditated and reflected
upon his decision to kill the victim. [101] No such evidence was presented to prove the presence of this
circumstance.
In the same vein, no evidence was adduced to prove that the firearms used in the shooting incidentwere
unlicensed, hence, this circumstance cannot be appreciated.
The presence of treachery qualified the killing of Abiabi to Murder punishable by reclusion perpetua to
death under Art. 248 of the Revised Penal Code, as amended by Rep. Act. No. 7659, viz:
ART. 248. Murder.- Any person who, not falling within the provisions of Article 246 shall kill another,shall
be guilty of murder and shall be punished by reclusion perpetua to death if committed with any of the
following attendant circumstances:
1. With treachery, taking advantage of superior strength, with aid of armed men, or employing means to
weaken the defense or of means or persons to insure or afford impunity. (emphasis supplied)
The presence of the aggravating circumstance of the use of motor vehicle would have raised the penalty
to death, pursuant to Art. 63 of the Revised Penal Code, if not for the presence of the mitigating
circumstance of voluntary surrender which the trial court failed to appreciate.
For voluntary surrender to be appreciated, the following requisites should be present: (1) the offender has
not been actually arrested; (2) the offender surrendered himself to a person in authority or the latters
agent; and (3) the surrender was voluntary. [102] Further, the surrender must be spontaneous in such a
manner that it shows the interest of the accused to surrender unconditionally to the authorities, either
because he acknowledged his guilt or because he wishes to save them the trouble and expenses
necessarily incurred in search and capture.[103] All these requisites have been complied with in the case at
bar.
The records reveal that the warrant for the appellants arrest was issued on January 19, 1998. Immediately
upon learning its issuance, and without having been served on him, the appellant contacted his co-accused
50
PO2 Lozano and communicated his desire to surrender. PO2 Lozano called City Director, Police
Superintendent Alejandro Carpio Lapinid and voluntarily surrendered himself at around 7:00 p.m. of
January 20, 1998. As per their agreement, the appellant was fetched by SPO2 Perfecto Silvederio Codiera
at around 12:15 a.m. of January 21,1998,and was directly broughtto the PNPJail at Camp SoteroCabahug,
Gorordo Ave., Cebu City. Police Senior Inspector Pablo Gayacan Labra II issued a compliance report
attaching thereto the unserved warrants, and explaining the attendant circumstances, viz:
The COMPLIANCE/RETURN OF WARRANT OF ARREST
That on the 20th day of January 1998 this office received the original copy of the Warrant of Arrestagainst
Police Officer 2 Armando LOZANO, Raul OCO @ Boy Usher, Dave SAMSON and Eutiquio PACAA, Jr., all
residents of A. Lopez St., Lobangon, Cebu City for Violation of Murder and Frustrated Murder issued and
signed by that Honorable Court dated 19 January 1998.
However, at about 7:00 oclock in the evening of January 20, 1998, Police Officer 2 Armando LOZANO
voluntarily surrendered to City Director, Police Superintendent Alejandro Carpio LAPINID while at around
12:15 oclock in the morning of January 21, 1998, Raul OCO @ Boy Usher was fetched by Senior Police
Officer 2 Perfecto Silvederio Codiera and immediately brought to this office. [104]
Moreover, one of the reasons cited by Judge Ocampo in acting favorably to the request of the appellant
and accused Lozano to be detained at the PNP Jail at Camp Sotero Cabahug, Gorordo Avenue, CebuCity
instead of the Bagong Buhay Rehabilitation Center (BBRC) was their voluntary surrender, viz:
In the meantime and until further orders of this Court- since this case is now under the jurisdiction of
Branch 7 presided by undersigned judge- and since the said accused had voluntarily surrendered to the
authorities anyway- they may continue to be detained at the PNP Jail where they have been broughtafter
their surrender- since their transfer to the BBRC forthwith would obviously expose them to the harm or
danger that they are precisely adverting to and explained by them in their aforesaid Urgent
Motions. [105] (emphasis supplied)
Finally, the appellants testimony as to the circumstances of his voluntary surrender was never rebutted.
He testified as follows:
Q: When did you see him (accused Dave Samson) again from that last time you said 1993 when you saw
him last?
A: At the time I surrendered at Gorordo.
Q: When you said you surrendered, you surrendered to whom?
.
A: At first, I approached Atty. Bragat and I also approached Dodong Lozano and Dodong Lozano called up
thru telephone at the camp.
Q: And did you in effect voluntarily surrender at the camp?
A: Yes, sir.
Q: Do you recall when was that?
A: On January 21, 1998.
 51

Q: You said you surrendered voluntarily at the camp on January 21, 1998. Was that voluntary surrenderin
relation to these two cases for which you now stand trial?
A: Yes, sir.[106]
Like any other common criminal, the appellant could have opted to go on hiding. But he chose to surrender
himself to the authorities and face the allegations leveled against him. True, he did not admit his complicity
to the crimes charged against him but he nonetheless spared the government of time and expense. For
this, he should be credited with the mitigating circumstance of voluntary surrender. This offsets the
aggravating circumstance of the use of motor vehicle, and pursuant to Art. 63(4) of the Revised Penal Code,
the appellant should be meted the lesser of the two penalties, i.e., reclusion perpetua.
For the serious wounding of Damuag, the appellant committed frustrated murder, the same having been
committed with intent to kill and with treachery, as afore explained. A crime is at its frustrated stage when
the offender performs all the acts of execution which would produce the felony as a consequence but
which, nevertheless, do not produce it by reason of causes independent of the will of the perpetrator.The
means and method employed by the appellant clearly show intent to kill. Indeed, Damuag could have died
as a result of the gunshot wounds he sustained if it were not for the timely operation performed on him.
Under Art. 50 of the Revised Penal Code, the penalty next lower in degree than that prescribed by law for
the consummated felony shall be imposed upon the principal in a frustrated felony. Applying the same
offsetting of the aggravating circumstance of the use of motor vehicle and of the mitigating circumstance
of voluntary surrender, the penalty should have been reclusion temporal in its medium period. However,
under the Indeterminate Sentence Law,the court shall sentence the accused to anindeterminate sentence
the maximum of which shall be that which, in view of the attending circumstances, could be properly
imposed under the rules of the said Code, and the minimum of which shall be within the range of the
penalty lower to that prescribed by the Code for the offense.[107] Considering all the circumstances, the
indeterminate penalty of six (6) years and one (1) day of prision mayor as minimum, and fourteen (14)
years and eight (8) months of reclusion temporal as maximum would be proper.
We reduce the amount due the victim Herminigildo Damuag. Damuag cannot recover actual damages for
aside from his bare allegations that he spentP160,000.00 for hospitalization and P5,000.00 for medicinal
needs, there is nothing on the record to substantiate his claim. In lieu of this, we award the amount
of P25,000.00 as temperate damages since it cannot be denied that he has suffered some pecuniaryloss
because of the incident.
IN VIEW WHEREOF, the joint decision on review is hereby AFFIRMED with the following MODIFICATIONS.
(1) In Crim. Case No. CBU-46172, appellant RAUL OCO @ BOY USHER is found GUILTY beyond reasonable
doubt of MURDER under Art. 248 of the Revised Penal Code, as amended by Rep. Act No. 7659, and is
sentenced to suffer the penalty of reclusion perpetua. He is ORDERED to pay the heirs of Alden Abiabi the
amount of P50,000.00 as actual damages, P50,000.00 as civil indemnity, and P25,000.00 as temperate
damages.
(2) In Crim. Case No. CBU-46173, appellant RAUL OCO @ BOY USHER is found GUILTY beyond reasonable
doubt of FRUSTRATED MURDER and is sentenced to suffer an indeterminate penalty of six (6) years and
one (1) day of prision mayor as minimum, to fourteen (14) years and eight (8) months of reclusion
temporal as maximum. He is ORDERED to indemnify Herminigildo Damuag the amount of P25,000.00 as
temperate damages.
Costs de officio.
SO ORDERED.

We come to the award of damages. The trial court ordered the appellant to indemnify the heirs of Abiabi
and the victim Herminigildo Damuag the amount of P1,000,000.00 and P500,000.00, respectively, without
specifying what these amounts represent.

In line with the recent jurisprudence, we modify the amount due the heirs of Abia bi as follows:
(a) P50,000.00 as actual damages representing the duly receipted expense for the purchase of the coffin,
(b) P50,000.00 as civil indemnity, and (c) P25,000.00 as temperate damages.

Except for the cost of the coffin, the remainder of P250,000.00, which Mrs. Abiabi claimed to have spent
for funeral and burial services, is unsubstantiated and therefore, cannot be awarded.

Furthermore, although Mrs. Abiabi testified that her husband earned P8,000.00 monthly as a legal
researcher of Clear, Inc., we cannot award indemnity for loss of earning capacity in the absence of
documentary evidence. [108] There are only two exceptions to the general rule requiring documentary
evidence for claims for damages for loss of earning capacity: (1) if the deceased is self-employed earning
less than the minimum wage under current labor laws, and judicial notice may be taken of the fact thatin
the victims line of work no documentary evidence is available; or (2) if the deceased is employed as a daily
wage worker earning less than the minimum wage under current labor laws. [109] Clearly, this case does not
fall under the exceptions.

[G.R. No. 141217. September 26, 2003]
PEOPLE OF THE PHILIPPINES, appellee, vs. EUSEBIO DUBAN y DOMINGO @ JUN, appellant.
D E C I S I ON
CARPIO-MORALES, J.:
From the decision [1] of the Regional Trial Court, Branch 18, Manila finding appellant Eus ebio Duban y
Domingo guilty beyond reasonable doubt of murder for the killing of Dionisio Barboza (the victim) and
sentencing him to suffer the penalty of reclusion perpetua, he comes to this Court on appeal.
In an information [2] dated October 28, 1997, appellant was indicted as follows:
That on or about October 9, 1997 at 11:00 am, in the City of Manila, Philippines, the said accused didthen
and there willfully, unlawfully and feloniously, with intent to kill and with treachery and evident
premeditation, attack, assault and use personal violence upon DIONISIO BARBOZA by then and there
striking him with a stone at the back of his head, thereby causing traumatic head injury which cause (sic)
his death thereafter.
Contrary to law.
Upon arraignment [3] on November 18, 1997, appellant, assisted by counsel de oficio, entered a plea of not
guilty. Thereafter, trial on the merits ensued.
On October 9, 1997, at 11:00 a.m., appellant admittedly hurled at the victim a stone estimated to weigh
one kilo, hitting the victim at the right rear portion of his head and ear, causing hi m to fall on the ground
unconscious. The victim died hours later after he was brought to the Jose Reyes Memorial Medical Center.
Appellant claimed self-defense, however. The prosecution claimed otherwise, alleging that it was plain
murder.
From the evidence of the prosecution, the following version is established. While prosecution witness
Dionisio Poquiz, a jeepney driver, was outside his house at Ramon Magsaysay Boulevard, Sta. Mesa,
Manila, the victim, a coconut vendor, passed by, pushing a cart loaded with coconuts. Poquiz bought
coconut juice and repaired to the rear seat of his parked jeepney where he sat. As Poquiz was drinking the
coconut juice, appellant approached the victim who was standing and waiting for a customer beside his
cart. When appellant, a jeepney barker, was about a meter away from the victim, he suddenly hurled the
stone which hit the right rear portion of his head and ear. Appellant then speedily left, foiling Poquizs
attempt to apprehend him.
The postmortem examination conducted on the victim by Dr. Ravell Ronald R. Baluyot of the National
Bureau of Investigation Medico-Legal Division showed the following findings:
Cyanosis, lips and nailbeds.
Blood, oozing from right ear.
Lacerated wound, stellate 2.6 x 1.5 cms., scalp, post-auricular area, right.
Scalp Hematoma, right, extensive.
52
Fracture, skill bones: middle and posterior fossae, linear, right.
Intracranial hemorrhage: Epidural, right parietal area; Subdural and subarachnoid right cerebral
hemisphere, extensive.
Visceral organs, congested.
Stomach, contains a small amount of brownish fluid. [4] (Underscoring supplied)
Upon the other hand, appellant detailed his self-defense as follows:
At about 12:00 noon of October 9, 1997, after alighting from a jeepney at the de la Fuente jeepney station,
as he was walking on his way home, a jeepney driver whose name he no longer remembers, asked him to
drink liquor with him. He declined the invitation as he had not yet eaten. The drunk companion of the
driver (the victim) whom he met for the first time got a glass of gin, however, and echoed the offer, but
he just the same declined it, prompting the victim to throw the contents of the glass at his face .
Appellant thus shouted invectives at the victim who then took a bolo from the jeepney which he tried to
hit him with, but which he (appellant) was able to evade.
[ATTY. OSORIO:]
Q: So what did you do when that somebody tried to hit you but missed it (sic)?
A: They were inside the jeepney at the time drinking and they alighted from the jeep.
COURT
Q: How about you what did you do?
A: I also got off from the jeep and I evaded the blows of the bolo aimed at me. [5]
Continuing, appellant claimed that as the victim ran after him, he ran around the jeepney because there
was an obstruction. Appellant thus took a stone placed under the tire of the jeep and with his right hand
he threw it at the victim while the latter was approaching him at a distance of about 3 meters. The stone
hit the victim on the [r]ight side of his head, [6] thus causing him to fall down. Appellant thereafter ran away
and went home.
Brushing aside appellants claim of self-defense, the trial court found him guilty beyond reasonable doubt
of murder by Decision of November 15, 1999, the dispositive portion of which is quoted verbatim:
WHEREFORE, the Court finds the accused, Eusebio Duban y Domingo, guilty beyond reasonable doubtof
the crime of murder under Article 248 of the Revised Penal Code and hereby sentences him to suffer the
penalty of reclusion perpetua with all the accessory penalties provided by law and to pay the costs.
On the civil liability of the accused, the Court further sentences him to pay the legal heirs of the victim,
Dionisio Barboza, moral and nominal damages in the respective sums of P200,000.00 and P70,000.00, and
an additional sum of P50,000.00, for the loss of the victims life with interest thereon at the legal rate of
6% per annum from today until fully paid.
SO ORDERED.
Hence, the present appeal anchored on the following assigned errors:[7]

THE TRIAL COURT ERRED IN CONVICTING ACCUSED-APPELLANT WHEN HIS GUILT HAS NOT BEEN PROVEN
BEYOND REASONABLE DOUBT.
ASSUMING ARGUENDO THAT ACCUSED-APPELLANT IS GUILTY, THE TRIAL COURT ERRED IN CONVICTING
HIM WITH THE CRIME OF MURDER WHEN THE QUALIFYING CIRCUMSTANCE OF TREACHERY HAS NOT BEEN
PROVEN BEYOND REASONABLE DOUBT. (Underscoring supplied)
Appellant contends that the testimony of eyewitness Poquiz, even if he was not shown to have been
actuated by any improper motive, is full of improbabilities, hence, it cannot prevail over his (appellants)
testimony. [8]
Appellant cites Poquizs testimony that he (appellant) was one arms length away from the victim as was
Poquiz from the victim. If that were the case, appellant argues, there would have been no need for him to
throw the stone at the victim [9] and Poquiz could have easily apprehended him (appellant).
Whether Poquiz estimated the correct distance from where he was in relation to where appellantand the
victim were is immaterial, however, appellant having himself admitted throwing the stone at the victim.
Admittedly, Poquiz was not prompted by ill motive to falsely testify against appellant, hence, his testimony
should be entitled to full faith and credit. [10]
Additionally, by appellants account, he, who is right-handed,[11] threw the stone at the victim who was
about 3 meters away, while the latter was facing and approaching him with a bolo. But the victim was
admittedly hit at the right rear portion of the head, [12] a fact confirmed by the above-stated result of the
postmortem examination of the victim. As thus observed by the trial court, appellants version cannot be
believed. For, it is highly improbable that the victim could be hit at the right rear portion of his head if he
and appellant were facing each other and appellant threw the stone with his right hand,[13] or that the
victim could be hit at the same right rear portion of his head if he were chasing appellant.
Neither can appellants claim that the victim was very drunk and armed with a bolo be believed. The result
of the postmortem examination of the victim gave no indication that he was drunk. As for the claimthat
the victim was armed with a bolo, why appellant did not take the bolo, if indeed he had, after the victim
fell down on being hit, is contrary to human experience. For an innocent man under similar circumstances
would naturally take it with him to prove his claim of self-defense. Such course of action is fatal to such
claim of appellant. [14] And so is his running away from the scene of the incident, for a truly innocentperson
would normally report the matter to the police.[15] But appellant did not. Instead, he immediately fled.
And while appellant claimed during direct examination that he told his side of the incident whenhe was
arrested two weeks later, [16] the police progress report[17] accomplished on his arrest shows that he, after
being apprised of his constitutional rights and of the charge against him, opted to remain silent.
Persons who act in legitimate defense of their persons or rights invariably surrender themselves to the
authorities and describe fully and in all candor all that has happened with a view to justify their acts.[18] But
appellant did not.
In fine, appellants version of the incident and his actuations soon after do not speak of his innocence.
The trial court did not err thus in not crediting appell ants claim of self-defense. Neither did it err in
appreciating the presence of treachery in the killing.
53
The essence of treachery is that the attack is deliberate and without warning, done in a swift and
unexpected manner of execution, affording the hapless and unsuspecting victim no chance to resist or
escape.[19] In the case at bar, the victim was standing and selling coconut, [20] totally oblivious of any
impending harm when appellant suddenly threw the stone from behind him.
There is no doubt then that appellant is guilty of murder, penalized under Article 248 of the RevisedPenal
Code, as amended by Republic Act No. 7569.There being neither mitigating nor aggravating circumstance,
the lesser penalty of reclusion perpetua was correctly imposed by the trial court, pursuant to Article 63(2)
of the Revised Penal Code.[21]
As to the civil aspect of the case, in line with prevailing jurisprudence, the award of indemnity to the heirs
of the victim in the amount of P50,000.00 is affirmed, it being awarded without need of proof other than
the fact that a crime was committed resulting in the death of the victim and that the accused was
responsible therefor. [22]
As for the award by the trial court of moral damages to the legal heirs of the victim in the amount
of P200,000.00, not only is the amount exorbitant, there is also no evidence to show that the legal heirs
of the victim suffered any mental anguish or serious anxiety arising from the victims death.
The award of P70,000.00 for nominal damages must be deleted for lack of factual and legal basis.
This Court notes that while Rolly Barboza, the victims brother, testified that the victims family incurred
medical and funeral expenses in the amount ofP65,000.00, he, in support thereof, presented a list[23] of
expenses. Only substantiated and proven expenses, however, or those that appear to have been genuinely
incurred in connection with the death, wake or burial of the victim will be recognized in court.[24] A listof
expenses is not considered a competent proof and cannot replace the official receipts necessary to justify
the award of actual damages. [25] Neither can the funeral contract [26] submitted in evidence by the
prosecution be sufficient, it not being proof that what was stipulated therei n was eventually paid. [27]
Nonetheless, where no sufficientproof of actual damages is presentedin the trial court (or when the actual
damages proven is less than P25,000.00), the amount of P25,000.00 as temperate damages may be
awarded, it being reasonable to presume that when death occurs, the family of the victim necessarily
incurs expenses for the wake and funeral. [28]
Under Article 2206 of the Civil Code, the heirs of the victim are entitled to indemnity for loss of earning
capacity. Ordinarily, documentary evidence is necessary for the purpose. By way of exception, testimonial
evidence may suffice if the victim was either (1) self-employed, earning less than the minimum wage under
current labor laws, and judicial notice may be taken of the fact that in the victims line of work, no
documentary evidence is available; or (2) employed as a daily-wage worker earning less than the minimum
wage under current labor laws.[29] In the case at bar, however, while the victims brother testifiedthat the
victim earned P300.00, he did not indicate whether the same referred to the victims hourly, daily, monthly
or annual income. [30]
Indemnification for loss of earning capacity partakes of the nature of actual damages which mustbe duly
proven[31] by competent proof and the best obtainable evidence thereof. [32]
Exemplary damages must be awarded too in accordance with Article 2230 of the Civil Code, the qualifying
circumstance of treachery being present. [33]
Finally, the award by the trial court of interest on damages at the legal rate of 6% per annum is in
accordance with Article 2211 of the Civil Code which states that in crimes and quasi-delicts, interest as
 54

part of damages may, in proper cases, be adjudicated in the discretion of the court, and none has been
shown that there has been abuse in the exercise thereof. [34]

WHEREFORE, the decision of the Regional Trial Court of Manila, Branch 18, finding appellant EUSEBIO
DUBAN y DOMINGO guilty beyond reasonable doubt of Murder and sentencing him to suffer the penalty
of reclusion perpetua is hereby AFFIRMED. The civil aspect of the case is MODIFIED to read as
follows: Appellant is hereby ORDERED to pay the heirs of Dionisio Barboza the amounts of P50,000.00 as
civil indemnity for his death,P25,000.00 as temperate damages, and P25,000.00 as exemplary damages,
with legal interest to be paid at SIX PERCENT (6%) on the amount due computed from the promulgation
of the decision of the trial court on November 15, 1999.

SO ORDERED.

G.R. No. 103225 September 15, 1994
PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
FEDERICO BALANAG alias "Pedring," accused-appellant,
TITO BALAWAG alias "Andres," (at large) and ROBERTO BALANAG alias "Berto," (at large) accused.
The Solicitor General for plaintiff-appellee.
Agaton D. Yaranon, Jr. for accused-appellant.
PUNO, J.:
Accused-appellant Federico Balanag and father and son Roberto and Tito Balanag were charged with
Robbery with Homicide. 1 The Information against them, dated March 14, 1986, reads:
That on or about the 24th day of November, 1985, in the Municipality of Aringay, Province of La Union,
Philippines, and within the jurisdiction of this Honorable Court, the above -named accused, conspiring and
confederating with one Serafin Dacanay y Ordonio who is now decease d, and helping one another, and
being then armed with handguns and bladed and/or sharp-pointed weapons, did then and there wilfully,
unlawfully, and feloniously with intent to gain and by means of force, violence and intimidation, and taking
advantage of nighttime, enter the dwelling of one Dr. Guillermo Lopez y Ferrer and once inside, take, steal,
and carry away a shoulder bag containing a diamond ring and earrings worth P3,000.00, a United States
fifty dollar bill (US $50.00), Philippine currency in the a mount of Two Hundred Pesos (P200.00), as well as
a mini-stereo cassette valued at Two Thousand Pesos (2,000.00) belonging to Genoveva L. Obra, a
daughter of the aforenamed Dr. Guillermo Lopez y Ferrer, and with intent to kill, by reason or on occasion
of the afore-described robbery, treacherously and taking advantage of their superior strength shoot with
the said handguns and stab with the said bladed and/or sharp-pointed weapons the aforenamed Dr.
Guillermo Lopez y Ferrer, thereby inflicting upon the latter mortal wounds which were the direct and
immediate cause of his death thereafter, to the damage and prejudice of the heirs of the said Dr. Guillermo
Lopez y Ferrer.
That in the commission of the offense, the following aggravating circumstances were present: (1) the
above-named accused took advantage of nighttime, to facilitate the commission of the offense, (2) the
offense was committed in the dwelling of the offended parties (3) the killing of the victim Dr. Guillermo
Lopez y Ferrer was committed with an unlicensed firearm.
CONTRARY TO LAW.
Tito and Federico were arraigned on April 17, 1986. They pleaded not guilty 2 and underwent trial. Roberto
Balanag, on the other hand, has remained at large. Before the prosecution could finish cross -examining
Tito Balanag, he absconded. 3 He was thus tried in absentia.
The essential facts came mainly from the testimonies of eyewitnesses Iluminada Lopez and Genoveva
Lopez y Obra.
On November 24, 1985, at about 7:30 P.M., GUILLERMO LOPEZ, SR., a dentist, was talking to his wife,
ILUMINADA LOPEZ, in the living room of their house, situated in Sitio Salapac, Aringay, La Union, while
55
their daughter, GENOVEVA LOPEZ y OBRA, was in the kitchen, brushing her teeth. Suddenly, three (3) men
barged into the front door of Dr. Lopez' house. Iluminada and Genoveva recognized two (2) of them as
their neighbors TITO BALANAG (a.k.a. Andres) and FEDERICO BALANAG (a.k.a. Pedring). The third man,
whom the Lopezes had seen for the first time, was later identified as SERAFIN DACANAY, a "compadre" of
Federico.
Serafin immediately announced a "hold-up." He poked a gun at the head of Iluminada, held herarm and
then led her towards Genoveva's room on the second floor of the house. Serafin demanded money and
other valuables from Iluminada. She then s ummoned Genoveva to give her the keys to the cabinet. Her
daughter followed.
Upon seeing Genoveva upstairs, Serafin also poked the gun at her head. Genoveva thus obediently
proceeded towards the cabinet, near the door of her room, and she was about to open the cabinet when
her father, Dr. Lopez, rushed upstairs. As Dr. Lopez was ascending the stairs, Serafin yelled at him saying:
"Okinam nga lakay sica ti ngangidarum quen Berto Balanag (Vulva of your mother, you are (sic) the one
(who) filed a case against Berto Balanag." 4 He shot Dr. Lopez who fell down the stairs which had no railings.
Downstairs, the victim was met by accused Tito Balanag who stabbed him (the victim) with a dagger.
Serafin then went downstairs and, likewise, stabbed the victim. Seeing the helpless condition of her father,
Genoveva screamed. She and her mother also rushed downstairs. Iluminada thought of asking for help
from their neighbors. Thus, she ran past her husband and proceeded outside their house thru the
backdoor.Genoveva,on the otherhand, went to her father's aid as Serafin continued assaulting herfather.
During the commotion, Tito and Federico fled, taking with them Genoveva's shoulder bag containing a
diamond ring and earrings worth three thousand pesos (P3,000.00); fifty d ollars
(US $50.00) cash; two hundred pesos (P200.00) cash; and a mini-stereo cassette, valued at P2,000.00.
Iluminada had barely stepped out of the house when she was blocked by "Berto" (Roberto) Balanag, Tito's
father, who aimed his gun at her. Iluminada quickly retreated to the house and closed the backdoor. She
stood behind the door and locked it as Berto tried to force his way in.
In the meantime, Genoveva and Serafin grappled for the bolo of the latter. Irked, he lunged at her, butshe
bravely parried the thrust with her arm. Her left forefinger was cut in the process. Serafin also fired at her
but missed. By stroke of luck, Genoveva managed to get a bolo and attacked Serafin in self defense. Serafin
died. So did the wounded Dr. Lopez. Several neighbors of the Lopezes who heard the commotion arrived
at the scene. One of them, a certain Jose Dulay, reported the incident to the authorities.
That evening, police authorities, namely: Station Commander P/Sgt. Alejandro Basallo, Pfc. Benjamin
Rulloda, Pat. Simeon Madarang, and Pat. Wilson Argame inspected the locus criminis. They found the
bloodied bodies of Dr. Guillermo Lopez and Serafin Dacanay, sprawled on the floor. They also recovered
the following: a Ruby Magnum, Cal. 22, with serial no. 05522; two (2) bolos soiled with blood; a double
bladed dagger; six (6) empty shells; and one live ammunition found inside the gun's chamber.
Dr. Armando Avena, Medical Officer of the Rural Health Unit of Doña Gregoria Memorial District Hospital
in Aringay, La Union, conducted the postmortem examination on the victim's body. Based on his
examination, Dr. Lopez sustained abrasion wound, two (2) stab wounds, and multiple gunshot wounds (on
the right breast upper outer quadrant, right zygomatic area and right upper lip). 5 Dr. Avena also treated
Genoveva Lopez Obra who sustained lacerated wound on the 3rd left forefinger. 6
According to the widow, Iluminada, her dentist husband used to earn P10,000.00 monthly. At the time of
her husband's death, they had three (3) children in college. She suffered mental anguish and could hardly
 56

sleep or eat upon her husband's death. During the two weeks wake for her deceased husband, she spent, THE TRIAL COURT ERRED IN CONVICTING THE ACCUSSED, FEDERICO BALANAG, OF THE COMPLEX CRIME
more or less, P25,000.00. OF ROBBERY WITH HOMICIDE AND/OR IN NOT EXONERATING HIM OF THE OFFENSE.

Federico Balanag interposed the defense of alibi. In the morning of November 24, 1985, he was allegedly We affirm the judgment of conviction.
in a farm in Salapac, Aringay, La Union, together with his brother Renato and mother-in-law, Florencia
Hidalgo. At about 5:00 P.M., after a day's work of threshing palay, they proceeded towards Federico's Prefatorily, the defense assails the validity of the Criminal Complaint, dated November 27, 1985, 10 and the
house. They arrived home at 5:30 P.M., and dined together thirty minutes later. Thereafter, Federicoslept amended Criminal Complaint, dated December 2, 1985, 11 filed by investigating officer P/Sgt. Alejandro
in the room with his youngest son Ronald. His wife, Teresita and the rest of the family went to bed at8:00 Basallo, on the ground that the owner of the stolen items Genoveva Lopez y Obra, was not identified.She
P.M. was merely referred to as the "offended party." Accused-appellantavers that a valid complaintfor robbery,
must specify the owner of the stolen property, considering that the phrase "personal property belonging
According to Teresita, her husband was sound asleep when she woke up at around 11:00 P.M. to urinate. to another," as an essential element of the crime of robbery, should be clearly established. 12 He claims,
She then nursed her eight-month old baby and stayed awake until midnight. At around 2:00 A.M. the further that he could be convicted of the crime of robbery with homicide since the victim of the robbery,
following day, the policemen came and took her husband with them. She learned later that Dr. Lopez had Genoveva Lopez y Obra, did not file any complaint for robbery, and the person killed, Dr. Guillermo Lopez,
been killed. She and her daughter Gina visited Federico in Jail. On their way to the municipal building, they was not robbed of his personal belongings. The argument lacks merit.
passed by the house of the victim. There were several persons in the vicinity but she did not inquire what
happened. We need not delve lengthily on the cited defect in the Criminal Complaint and Amended Criminal
Complaint since the said error was corrected in the Information, dated March 14, 1986. 13 Said information
At the police station, Teresita noticed that her husband had bruises. He then told her he was manhandled alleged that the stolen items belong to Genoveva Lopez y Obra, daughter of Dr. Guillermo Lopez.
by Station Commander Alejandro Basallo.
We have also ruled that in this kind of a complex crime, the victim of the robbery need not necessarily be
Gina Balanag corroborated the testimonies of her parents pertaining to the whereabouts of her father, the victim of homicide. 14 Thus, in People vs. Disimban, 15 we affirmed the conviction of the accused for
the accused-appellant. She averred that on November 24, 1985, she went to school at about 6:30 A.M. robbery with homicide although the robbery victim was different from the homicide victim. There is robo
She returned home from school at 4:30 P.M. She saw her father an hour later. Her father slept at 7:30 P.M. con homicido even if the victim killed was an innocent
after dinner. bystander. 16 Or that death supervened by mere accident, provided that the homicide was produced by
reason or on the occasion of robbery, inasmuch as it is only the result obtained, without reference or
She claimed further that, at about 6:30 A.M., the morning following the incident, she was on her way to distinction as to the circumstances, causes, modes or persons intervening in the commission of the crime,
school. As she was nearing the house of Dr. Lopez, Genoveva and the latter's sister who was then carrying that has to be taken into consideration. 17 In the recent case of People vs. Pamintuan, 18 the accused
a wooden stick ("malo"), were waiting for her (Gina) and her companions ("Agharang da amin"). She prisoners were held liable for robbery with homicide although the items robbed, i.e., five (5) shotguns and
decided to skip school. three (3) guns, Ruby Cal. 22, belong to the armory of the Provincial Jail of San Fernando, Pampanga, and
not the personal properties of the homicide victims, the provincial jail guards.
The Balanags described their dwelling as a one room house that it would not be possible for them toleave
without being seen or noticed by the other members of the family. Prior to the robbery and killing, the We now come to the more important issues of whether the guilt of accused-appellant was established
Balanags were in good terms with the Lopezes. Federico denied he was in the company of his cousinTito beyond reasonable doubt. We rule in the affirmative.
Balanag and Serafin Dacanay that fateful evening of November 24, 1985. He admitted, however, that
Serafin was the godfather of one of his children. At least two credible witnesses, Iluminada and Genoveva, positively identified accused-appellant Federico
Balanag as among those who barged into their house that tragic evening. Genoveva even saw accused-
After trial, the court a quo found Federico Balanag and his co-accused Tito Balanag guilty of Robbery with appellant when he fled from the scene, taking with him a mini-stereo cassette. These eyewitnesses could
Homicide. 7 They were meted the penalty of reclusion perpetua. The court a quo also ordered accused- not have been mistaken as they knew Federico and Tito even before the incident. The records reveal that
appellant and Tito Balanag, to indemnify, solidarily, the heirs of the deceased Dr. Guillermo Lopez, the the Lopezes and the Balanags were neighbors since birth. 19
following amounts:
It was also not improbable for the eyewitnesses to recognized the faces of the culprits. According to
a) P50,000.00 — for the death of Guillermo Lopez; Genoveva, the accused were not wearing masks, albeit Serafin was wearing a hat. At that time, too,the
b) P48,110.00 — as actual damages; place of incident was well lighted as 50 watts electric bulbs, installed along the porch, in the living room
c) P20,000.00 — as moral damages; and and the kitchen, were on. 20
d) P172,000.00 — for loss of earning capacity.
The credibility of these eyewitnesses is further enhanced by the fact that Iluminada and Genoveva had no
Both accused appealed. 8 However, Tito Balanag, who has remained at large, did not file the required ill feelings against Federico prior to the incident. Accused-appellant himself confirmed this lack of ill
Appellant's Brief. His appeal was considered abandoned for failure to prosecute his appeal and, more motive. 21 Thus, we see no reason to depart from the well established rule that when there is no evidence
importantly, for his refusal to submit himself to the jurisdiction of the authorities. 9 to show that the prosecution witnesses were actuated by improper motive, their identification of the
Accused-appellant Federico Balanag now contends:

accused should be given full faith and
credit. 22
Nonetheless, accused-appellant stresses that nobody testified on his participation to the killing. He points
out that, since there was no proof of cons piracy, he could not be held responsible for the death of Dr.
Lopez. We hold otherwise.
Conspiracy need not be proved by direct evidence of prior agreement to commit the crime. It could be
inferred from the conduct of the accused before, during or after the commission of the crime, showing
that the accused had acted in unison with each other, evincing a common purpose or design. 23 The
circumstances in field show the existence of conspiracy among accused-appellant and his cohorts.
Federico, Serafin and Tito simultaneously barged thru the front door of Dr. Lopez' residence. To further
secure the area, Roberto Balanag stood on guard at the back portion of the house. Serafin then led
Iluminada upstairs, while Tito and Federico stayed downstairs. Their plan was almost perfect and would
have been successful if Dr. Lopez did not attempt to rescue his wife and daughter from Serafin. Dr. Lopez'
unexpected resistance, albeit futile in the hands of the armed robbers, aborted the well -planned robbery.
Thus, Tito and Federico hastily got Genoveva's shoulder bag and the mini-stereo cassette. They fled
together, leaving behind Serafin who was still grappling with Genoveva. Without a doubt, accused-
appellant acted in unison and cooperated with his companions in committing th e robbery.
It is settled that when homicide is committed as a consequence or on the occasion of the robbery, all those
who took part as principals in the robbery will also be liable as principals of the special crime of robbery
with homicide, although they did not actually take part in the homicide. The exception to the rule is when
it is clearly shown that they endeavored to prevent the unlawful killing. 24 In this case, there is no evidence
that accused-appellant tried to prevent the killing of Dr. Lopez. His claim of innocence is believe by the fact
that, after Dr. Lopez was shot and stabbed by his cohorts, he carried away the mini-stereo cassette of the
Lopezes. Accused-appellant was, therefore, correctly found guilty of the special complex crime of robbery
with homicide.
Accused-appellant's defense of alibi cannot succeed because of circumstances pointing to its contrived
nature and his positive identification by the prosecution witnesses. 25 The records show that accused-
appellant's house was about 120 meters from the house of the Dr, Lopez, thus, it was not physically
impossible for him to be at the scene of the crime and to commit the crime. 26
The testimonies given by accused-appellant's wife and daughter vis-a-vis that of eyewitnesses Iluminada
and Genoveva, do not inspire belief. For one, Gina lied when she testified she attended school on
November 24, 1985. When confronted that it was a Sunday, she got confused and said she went toschool
on November 22, 1985 or January 22, 1985. Gina also denied knowing Dr. Lopez, only to admit later that
she knew him as he was their neighbor. 27 She also claimed that Genoveva and her sister waited for them
after the incident, prompting her not to proceed to school. On cross-examination, however, Gina admitted
that she was not sure if they were really waiting for them.
The testimony of Teresita appears to be more consistent in contrast to her daughter's story. However, the
trial court gave greater credence on the prosecution witnesses' testimonies. It is settled that when the
issue of credibility of witnesses is involved, appellate courts will generally not disturb the findings of the
trial court considering that the latter is in a better position to decide the question, having heard the
witnesses themselves and observed their deportment and manner of testifying during the trial, unless
certain facts of value have been plainly overlooked which if considered, might affect the result of the
case. 28
57
Robbery with Homicide is punishable with reclusion perpetua, notwithstanding the aggravating
circumstances attending the commission of the crime, 29 since at the time of the commission of the
offense, Congress had yet to restore the imposition of death penalty.
In connection with the civil liability of accused-appellant, the award of P48,110.00, for actual or
compensatory damages, is not fully supported by evidence. The records show that the total amount
incurred for burial/funeral expenses was P19,482.00, not P23,110.00. 30
Anent Mrs. Lopez' additional claim of P25,000.00 for the expenses incurred during the two weeks wake
for the victim, we find the said claim reasonable considering the social standing of the Lopezes in the
community. The Lopezes are prominent in their place, not to mention they belong to a big family. (Mr. and
Mrs. Lopez sired 13 children, most of whom are professionals and gainfully employed). The total award for
actual damages should then be P44,482.00, and not P48,110.00.
With respect to the claim for loss of earning capacity of the victim, we note that the victim was already69
years old at the time he was killed on November 24, 1985. His income as a dentist was P10,000.00 per
month, or P120,000.00 per annum. After deducting therefrom the necessary and incidental expenses
which the victim would have incurred if he were alive, the court a quo, declared that the victim's annual
net income would be P24,000.00. The trial court multiplied his net annual income by his life expectancyof
seven (7) years and two (2) months, 31 hence, P172,000.00 was awarded for loss of the earning capacityof
the victim.
In computing the loss of the earning capacity of the victim, several factors are considered besides the
mathematical computation of annual income times life expectancy. Allowances are made for
circumstances which could reduce the computed life expectancy of the victim, e.g., nature of work of the
victim, 32 his lifestyle, age, and state of health prior to his death. 33 In addition, we have to consider the
rate of loss sustained by the heirs of the victim. 34 In this case, albeit there was no evidence on the state of
health of the victim, considering his advanced age, we find it reasonable and fair to assume that he would
not be able work and earn, as a dentist, until he reaches the final moment of his life. 35 Thus, we reduce
the award for loss of the earning capacity of the deceased to P144,000.00, which is the approximate
amount he would have earned until his 75th birthday. 36
WHEREFORE, premises considered, we AFFIRM WITH MODIFICATION the assailed Decision, dated
September 5, 1991, of the Regional Trial Court (Branch XXXIII) of Bauang, La Union, in Criminal Case No. A-
1540. Accordingly, the indeminification granted in favor of the heirs of DR. GUILLERMO LOPEZ, are
modified as follows:
a) P50,000.00, for the death of Dr. Lopez;
b) P20,000.00, for moral damages;
c) P44,482.00, for actual expenses; and
d) P144,000.00, for loss of the earning capacity.
No costs.
SO ORDERED.

[G.R. No. 162767. February 28, 2005]
PEOPLE vs. ZARATE
SECOND DIVISION
Gentlemen:
Quoted hereunder, for your information, is a resolution of this Court dated FEB 28 2005.
G.R. No. 162767 (People of the Philippines vs. Mae Zarate.)
RE SO LUT IO N
Pending before the Court is a Motion for New Trial, with prayer to suspend period for filing the brief and
to use the property bond as her bailbond during the pendency of this appeal, filed by Mae Zarate, the
accused-appellant in Criminal Case No. 01-101627.
Appellant was charged [1] in Criminal Case No. 01-101627 before the Regional Trial Court (RTC) of Quezon
City, Branch 89, with the crime of Failure to Return a Minor, for allegedly failing to restore minor Jason
Demogena to her mother Merly Demogena.
On 30 October 2003, the RTC of Quezon City, Branch 89, rendered a decision[2] convicting the accused-
appellant, the dispositive portion of which reads:
WHEREFORE, premises considered, accused Mae Zarate is found GUILTY beyond reasonable doubtof the
crime of Failure to Return a Minor under Article 270 of the Revised Penal Code and is hereby sentenced to
suffer an imprisonment of TWENTY (20) YEARS AND ONE (1) DAY TO FORTY (40) YEARS OF RECLUSION
PERPETUA.
Likewise, Mae Zarate is ordered to pay spouses Demogena the sum of ONE HUNDRED THOUSAND PESOS
(P 100,000.00) PESOS as and by way of moral damages.
Accordingly, said accused is ordered immediately committed to the Correctional Institute for Women and
the Property Bond posted for her provisional liberty is canceled.
On 19 November 2003, accused-appellant, thru counsel, filed a notice of appeal[3] of the decision of the
trial court, thereby giving notice that she is appealing the case to the Court of Appeals.
On 31 March 2004, the Court of Appeals transmitted[4] the records of the case to this Court, considering
that the penalty imposed was reclusion perpetua.[5]
On 08 November 2004, this Court resolved [6] to accept the appeal and required the Presiding Judge of the
said RTC to inform us of the whereabouts of accused-appellant within ten (10) days from notice andthe
Chief of the Judicial Records Office to send notices to fil e brief.
On 20 December 2004, the Presiding Judge of said court submitted her explanation[7] dated 30 November
2004, stating, among other things, that accused-appellant failed to appear during the promulgation of
judgment despite due notice, thus, the property bail was confiscated and forfeited by the Court and a
warrant of arrest was issued. To date, she has no information as to the whereabouts of the accused.
58
On 06 January 2005, accused-appellant, thru counsel, filed the aforementioned motion for new trial with
prayer to suspendthe period for filing appellant's brief and to use the property bondas her bailbond during
the pendency of this appeal. Accused-appellant stated that while the appeal is pending, a supervening
event transpired wherein the missing child, Jason Demogena, was found and was returned to the private
complainant Merly Demogena. Thus, thru counsel, she filed a motion to take deposition of complainant
Merly Demogena and one Nita Mamaril in the trial court which was subsequently granted. The taking of
said depositions was scheduled on 13 December 2004. Accused-appellant claimed that the depositions of
Merly Demogena and Nita Mamaril, if duly taken, will prove her innocence of the crime charged.
We deny the motion and dismiss the appeal.
Records disclose that accused-appellant failed to appear at the promulgation of judgment (as disclosed by
the judge's explanation dated 30 November 2004). The trial court, despite accused-appellant's absence,
promulgated the judgment of conviction. She remains at large even while her counsel continues to file
various pleadings before the RTC, i.e., the notice of appeal [8] and motion to take the depositions[9] of Merly
Demogena and Nita Mamaril, and the motion for new trial with this Court, with prayer to suspend period
for filing brief and to use her property bond as her bailbond during the pendency of this appeal.
Section 6, par. 5, Rule 120 of the Revised Rules of Criminal Procedure provides:
If the judgment is for conviction and the failure of the accused to appear was without justifiable cause,he
shall lose the remedies available in these Rules against the judgment and the court shall order his arrest.
Within fifteen (15) days from promulgation of judgment, however, the accused may surrender andfile a
motion for leave of court to avail of these remedies. He shall state the reasons for his absence at the
scheduled promulgation and if he proves that his absence was for a justifiable cause, he shall be allowed
to avail of said remedies within fifteen (15) days from notice. (Emphasis supplied)
Corollary to this rule is the second paragraph of Section 8 of Rule 124 of the 2000 Revised Rules of Criminal
Procedure which says:
The Court of Appeals may also, upon motion of the appellee or on its own motion, dismiss the appeal if
the appellant escapes from prison or confinement, or jumps bail or flees to a foreign country during the
pendency of the appeal.
Section 1 of Rule 125 of the 2000 Rules of Criminal Procedure extends the scope of the applicability of the
above-cited rules:
Unless otherwise provided by the Constitution or the law, the procedure in the Supreme Court in original
as well as in appealed cases shall be the same as in the Court of Appeals.
The rationale for Section 8, Rule 124, is that once an accused escapes from imprisonment, or jumps bail or
flees to a foreign country, he loses his standing in court and unless he surrenders or submits to the
jurisdiction of the court, he is deemed to have waived any right to seek relief from the court. [10]This
doctrine applies not only to the accused who jumps bail during the appeal, but also to one who does so
during the trial. [11] As illuminated by Justice Florenz D. Regalado:
. . . When, as in this case, the accused escaped after his arraignment and during the trial, but the trial
in absentia proceeded resulting in the promulgation of a judgment against him and his counsel appealed,
since he nonetheless remained at large his appeal must be dismissed by analogy with the aforesaid
provision of this Rule (Rule 124, §8 of the Rules of Criminal Procedure). [12] (Emphasis supplied)
 59

The accused cannot be accorded the right to appeal unless they voluntarily submit to the jurisdiction of
the court or are otherwise arrested within 15 days from notice of the judgment against them. [13] While at
large, they cannot seek relief from the court, as they are deemed to have waived the appeal. [14]

Taking our cue 'from the above-cited laws and jurisprudence, as accused-appellant remains at large and
refused to surrender, she is denied any right to seek relief from this Court, including her right to appeal
which is deemed to have been abandoned. Consequently, the judgment against her has become final and
executory. [15] By fleeing, the herein accused exhibited contempt of the authority of the court a ndplaced
herself in a position to speculate on her chances for a reversal. In the process, she kept herself outof the
reach of justice, but hoped to render the judgment nugatory at her option. [16] Such conduct is intolerable
and does not invite leniency on the part of the appellate court. [17]

Considering the foregoing, the appeal is accordingly DISMISSED and accused's Motion for New Trial dated
05 June 2005 and accompanying prayer to suspend the period for filing appellant's brief and to use the
property bond as her bailbond during the pendency of this appeal are correspondingly DENIED.

SO ORDERED.
 60

PEOPLE v. ARNEL MATARO

G.R. No. 130378. March 8, 2001

Accused-appellants were found guilty for the crime of murder, and both were sentenced to suffer the
penalty of reclusion perpetua and to pay the heirs of the victim.

HELD:

The accused appellants invoke the “equipoise” rule because their guilt had not been established beyond
reasonable doubt. The SC said that it has enumerated the requisites for credible identification in the case
of

People v. Teehankee, Jr., 249 SCRA 54 (1995) as follows:

1) the witness’ opportunity to view the criminal at the time of the crime;

2) witness’ degree of attention at that time;

3) the accuracy of any prior description given by the witness;

4) the level of certainty demonstrated by the witness at the identification;

5) the length of time between the crime and the identification; and

6) the suggestiveness of the identification procedure. 18

The Court held that in their view, these requirements were met. In the instant case, there is no question
that both witnesses had the opportunity to view the incident as it unfolded before them with a degree of
attention that allowed them to take in the important details and recall them clearly. Moreover, as
repeatedly stressed, appellate court should accord to the factual findings of trial courts and their
evaluation great weight and respect concerning the credibility of witnesses. The conditions of visibility
being favorable and these witnesses not appearing to be biased, the conclusion of trial courts regarding
the identity of the malefactors should normally be accepted.

The SC also held that the trial court did not err in qualifying the killing as murder. There was treachery in
this case since, as testified to by prosecution witness Fernandez, the victim had already dismissed the
appellants after they talked to him. The victim was deliberately allowed to enjoy a false sense of security.
They shot the victim when the latter had his hands raised. The SC therefore affirmed the ruling of the lower
court, but made modifications with the costs to be paid by the accused.

[G.R. No. 152134. June 4, 2004]
ENDREO MAGBANUA, VALLACAR TRANSIT, INC., and its Present Corporate Official RICARDO
YANSON, petitioners, vs.JOSE TABUSARES, JR., EVA T. LAFIGUERA, NONA C. TABUSARES, JUN C.
TABUSARES, FE C. TABUSARES and JAX C. TABUSARES, respondents.
D E C I S I ON
PUNO, J.:
The case at bar arose from the complaint for damages filed by spouses Jose Tabusares, Sr. and Rebecca
Tabusares against petitioners, Endreo A. Magbanua, Vallacar Transit, Inc., and/or its corporate officials for
the tragic death of their son, Jury Tabusares, in a vehicular mishap involving a Ceres Liner Bus owned and
operated by petitioners. The case was docketed as Civil Case No. 4654 before the Regional Trial Court of
Negros Occidental, Branch 48,Bacolod City.
The facts, as found by the trial court, are as follows:
At about 4:30 oclock in the afternoon of October 25, 1986, a Ceres Liner Bus No. 154 with Plate No.GVG
469, driven by Endreo Magbanua and owned and operated by Vallacar Transit, Inc., and an Amante Type
Jeepney bearing Plate No. FBN 996, driven by Felipe Palacios and owned by Salvador Algara, Sr. figuredin
a vehicular accident along the national roadat Hda. Mabuhay,Gil Montilla, Sipalay, Negros Occidental. The
Ceres Liner Bus bumped the rear portion of the Amante Type Jeepney while both vehicles were running
downhill on the same direction towards the town of Sipalay from the North. Due to the impact, several
passengers of the Amante Type Jeepney were thrown out and ran over by the Ceres Liner Bus and died as
a result of the injuries they sustained. (O)ne of those killed was Jury Tabusares, 27 years of age, single,an
employee of the Maricalum Copper Mines as Oiler 2B and was then receiving P1,256.00 monthly salary
plus P510.00 cost of living allowance (COLA) or a total monthly income of P1,766.00. Jury Tabusares was
the son of the plantiffs Jose Tabusares, Sr. and Rebecca Tabusares. Immediately before the bumping
accident, the Ceres Liner Buss driver, Endreo Magbanua, was trying to overtake the Amante Type Jeepney
ahead of him and he said that he did not apply his brakes because he cannot overtake if he will slow
down. The Amante Type Jeepney was overloaded with 35 passengers and some of them clinging on its
sides and some were riding on the roof. While the Ceres Liner (B)us was about one and a half (1) meters
from the Amante Type Jeepney, the bus driver saw that the jeepney went zigzagging on the middle of the
road and since he could not control the bus anymore it bumped the rear portion of the jeep.
After a careful perusal of the circumstances of the case, the (c)ourt finds that the Amante Type Jeepney,
as testified to by its own driver, Felipe Palacios, was not a passenger jeepney but a private vehicle which
is used by its ownerSalvadorAlgara, Sr.,who is an ambulant peddler in his peddling business. But,although
not for passengers, it was carrying 35 passengers at the time of the bumping accident on October 25,
1986 as testified to by Traffic Investigator Pfc. Praxedes Campillanos of the Sipalay Police Command,
Sipalay, Negros Occidental. This jeep had a seating capacity of only 16 passengers but it was made to
accommodate passengers on its roof and some were clinging on its side. This act is not only gross
negligence but it was violative of the traffic rules and regulations. On the other hand, the (c)ourt alsofinds
that the driver of the Ceres Liner Bus was driving his vehicle negligently and recklessly because Endreo
Magbanua testified and admitted that while driving the bus downhill and following the Amante type
Jeepney ahead of him, he did not apply his brakes because he was trying to overtake when he bumped the
jeep on its rear portion. This act was negligent and reckless because Endreo Magbanua could have avoided
the bumping of the jeepney had he applied his brakes considering that he has the last clear chance to
prevent a collision by slowing down and reducing speed. [1]
61
The trial court found that the negligent acts of the drivers of both the jeepney and the Ceres Liner Bus
combined in directly causing the death of Jury Tabusares. It therefore held both drivers solidarily liable for
damages. The court ruled:
WHEREFORE, in view of the foregoing considerations, judgment is hereby rendered ordering and
condemning the defendants Endreo A. Magbanua, Vallacar Transit, Inc., thru and represented by its
corporate official Ricardo Yanson, Felipe T. Palacios and Salvador Algara, Sr. to pay jointly and severally to
the plantiffs, as follows:
1. The sum of P50,000.00 as indemnity for the death of Jury Tabusares;
2. The amount of P699,336.00 as indemnity for the loss of the earning ca pacity of the late Jury Tabusares;
3. The amount of P27,600.00 as reimbursement for actual expenses in connection with the death and
burial of the said deceased;
4. The amount of P10,000.00 as moral damages; and
5. The sum of P10,000.00 as reasonable attorneys fees.
The cross-claim of defendant Salvador Algara, Sr. against the defendants Endreo A. Magbanua and Vallacar
Transit, Inc.,represented by its corporate official Ricardo Yanson, is hereby allowed and defendants Endreo
A. Magbanua and Vallacar Transit, Inc., represented by it (sic) corporate official Ricardo Yanson are hereby
ordered to indemnify Salvador Algara, Sr. in such amount as he may be required to pay as damages to the
herein plaintiffs.
The counterclaims of the defendants against the plainti ffs are hereby dismissed for lack or merit.
SO ORDERED.[2]
Petitioners appealed to the Court of Appeals. They prayed that the decision of the trial court be reversed
insofar as their liabilities are concerned. [3]
During the pendency of the appeal, Jose Tabusares, Sr. and his wife, Rebecca, passed away. On May 18,
1999, the Court of Appeals approved the substitution of the late spouses by their heirs, namely: Jose
Tabusares, Jr., Eva T. Lafiguera, Nona C. Tabusares, Jun C. Tabusares, Fe C. Tabusares and Jax C.
Tabusares. [4]
On March 13, 2001, the Court of Appeals rendered its decision. It affirmed the factual findings of the trial
court, but modified the award of damages, reducing the amount of lost earning to P374,392.00. Itmade
the following computation:
In the case at bar, the victim Jury Tabusares was twenty- seven (27) years old at the time of death. With
65 years as the given life expectancy in the Philippines, the victim was expected to live for another thirty-
eight (38) years. In respect of income, the victim was receiving the amount of P1,766.00 as total monthly
income or a gross yearly income of P21,192.00. Multiplied by 38, the number of years the victim is
expected to continue living, the amount arrived at is P748,784.00 using the formula 2/3 x [80-27] x
21,192.00. From the said figure must be deducted the reasonable amount of P374,392.00 or 50% thereof
representing the living and other necessary expenses of the deceased had he continued to live. Hence, the
lost earnings of the deceased should be P374,392.00. [5]
 62

Petitioners filed a partial motion for reconsideration of the decision of the Court of Appeals, praying for a Aside from the loss sustained by the heirs of the deceased, another factor considered in determining the
reduction of the amount of damages for loss of earning capacity. The Court of Appeals denied the award of loss of earning capacity is the life expectancy of the deceased which takes into account his work,
motion. [6] Hence, this petition. lifestyle, age and state of health prior to the accident. [13]

Petitioners, while accepting the factual findings of the trial court and the appellate court, now assail the Thus, the formula for the computation of unearned income is:
latters computation of the award of damages for loss of earning capacity. They contend that there are
varying computations used in the decisions of this Court. In People vs. Lopez,[7] the Court applied the Net life gross living
following formula:
Earning = expectancy x annual less expenses
2/3 x (80-27) x P21,192.00 50%
Capacity income
However, the following formula was employed in People vs. Muyco, et al.:[8]
Life expectancy is determined in accordance with the formula:
2/3 x (80 27) x P21,192.00 80%
2/3 x [80 age of deceased]
The difference lies in the computation of the net income of the victim. In the Lopez case, net income was
The bone of contention in this case is the amount of living expenses that should be deducted from the
derived by deducting 50% of the gross annual income, while in the Muyco case, the amount deducted was
deceaseds gross annual income - whether 50% or 80%.
80% of the gross annual income. The Court of Appeals followed the computation in People vs. Lopez as it
was the prevailing case law at the time of the decision appealed from was promulgated and unmistakably A survey of more recent jurisprudence shows that the Court consistently pegged the amount at 50% of the
more favorable to the heirs of the deceased xxx. [9] Petitioners argue that the instant case was decided by gross annual income. [14] We held in Smith BellDodwell Shipping Agency Corp. vs. Borja[15] thatwhenthere
the Court of Appeals one year and six months after the promulgation of People vs. Muyco, therefore, the is no showing that the living expenses constituted a smaller percentage of the gross income, we fix the
Court should apply the computation in the latter case. [10] living expenses at half of the gross income, thus:

On the other hand, the respondents, in their comment, cite other cases decided after the Muyco case In other words, only net earnings, not gross earnings, are to be considered; that is, the total of the earnings
where the Court applied the formula in the Lopezcase. They submit that the computation in People vs. less expenses necessary in the creation of such earnings or income, less living and other incidental
Lopez should be applied in this case. [11] expenses. When there is no showing that the living expenses constituted a smaller percentage of the
gross income, we fix the living expenses at half of the gross income. To hold that one would have used
The petition is devoid of merit.
only a small part of the income, with the larger part going to the support of ones children, would be
Article 2205 of the New Civil Code allows the recovery of damages for loss or impairment of earning conjectural and unreasonable. (emphasis supplied)
capacity in cases of temporary or permanent personal injury. Such damages covers the loss sustainedby
There is no evidence in the case at bar whether the living expenses of the victim, Jury Tabusares,
the dependents or heirs of the deceased, consisting of the support they would have received from him
constituted a bigger or smaller percentage of his gross income. In such case, it is fair to assume thatit is
had he not died because of the negligent act of another. The loss is not equivalent to the entire earnings
50% of his gross annual income. Hence, we find that the Court of Appeals did not err in its computationof
of the deceased, but only that portion that he would have used to support his dependents or heirs. Hence,
the award of loss of unearned income to petitioner.
we deduct from his gross earnings the necessary expenses supposed to be used by the deceased for his
own needs. The Court explained in Villa Rey Transit, Inc. vs. Court of Appeals[12] that: IN VIEW WHEREOF, the petition is DENIED. The assailed decision of the Court of Appeals is AFFIRMED.
(the award of damages for loss of earning capacity is) concerned with the determination of the losses or SO ORDERED.
damages sustained by the private respondents, as dependents and intestate heirs of the deceased, and
that said damages consist, not of the full amount of his earnings, but of the support they received or would
have received from him had he not died in consequence of the negligence of petitioners agent. In fixing
the amount of that support, we must reckon with the necessary expenses of his own living, which should
be deducted from his earnings. Thus, it has been consistently held that earning capacity, as an elementof
damages to ones estate for his death by wrongful act is necessarily his net earning capacity or his capacity
to acquire money, less the necessary expense for his own living. Stated otherwise, the amount recoverable
is not loss of the entire earning, but rather the loss of that portion of the earnings which the beneficiary
would have received. In other words, only net earnings, not gross earning are to be considered thatis, the
total of the earnings less expenses necessary in the creation of such earnings or income and less living and
other incidental expenses.
 63

People vs. Narvaez, 121 SCRA 389 (1983)  Lack of sufficient provocation on part of person defending himself. Here, there was no
provocation at all since he was asleep
FACTS: Mamerto Narvaez has been convicted of murder (qualified by treachery) of David Fleischer and
Flaviano Rubia. On August 22, 1968, Narvaez shot Fleischer and Rubia during Since not all requisites present, defendant is credited with the special mitigating circumstance of
the time the two were constructing a fence that would prevent Narvaez from getting into his house and incomplete defense, pursuant to Art. 13(6) RPC. These mitigating circumstances are: voluntary surrender
rice mill. The defendant was taking a nap when he heard sounds of construct ion and and passion and obfuscation (read p. 405 explanation) Crime is homicide (2 counts) not murder because
found fence being made. He addressed the group and asked them to stop destroying his house and asking treachery is not applicable on account of provocation by the deceased. Also, assault was not deliberately
if they could talk things over. Fleischer responded with "No, gadamit, proceed, go chosen with view to kill since slayer acted instantaneously. There was also no direct evidence of planning
ahead." Defendant lost his "equilibrium," and shot Fleisher with his shotgun. He also shot Rubia whowas or preparation to kill. Art. 249 RPC: Penalty for homicide is reclusion temporal. However, due to mitigating
running towards the jeep where the deceased's gun was placed. Prior to the circumstances and incomplete defense, it can be lowered three degrees (Art. 64) to arrestomayor.
shooting, Fleischer and Co. (the company of Fleischer's family) was involved in a legal battle with the
defendant and other land settlers of Cotabato over certain pieces of property. At the time 3. WON he should be liable for subsidiary imprisonment since he is unable to pay the civil indemnitydue
of the shooting, the civil case was still pending for annulment (settlers wanted granting of property to to the offended party.
Fleisher and Co. to be annulled). At time of the shooting, defendant had leased his
property from Fleisher (though case pending and ownership uncertain) to avoid trouble. On June 25, No. He is not liable to be subsidiarily imprisoned for nonpayment of civil indemnity. RA 5465 made the
defendant received letter terminating contract because he allegedly didn't pay rent. provisions of Art. 39 applicable to fines only and not to reparation of damage caused, indemnification of
He was given 6 months to remove his house from the land. Shooting was barely 2 mont hs after letter. consequential damages and costs of proceedings. Although it was enacted only after its conviction,
Defendant claims he killed in defense of his person and property. CFI ruled that considering that RA 5465 is favorable to the accused who is not a habitual delinquent, it may be given
Narvaez was guilty. Aggravating circumstances of evident premeditation offset by the mitigating retroactive effect pursuant to Art. 22 of the RPC.
circumstance of voluntary surrender. For both murders, CFI sentenced him to reclusion perpetua, to
indemnify the heirs, and to pay for moral damages. Judgment: Defendant guilty of homicide but w/ mitigating circumstances and extenuating circumstance of
incomplete self defense. Penalty is 4 months arresto mayor and to indemnify
ISSUES: each group of heirs 4,000 w/o subsidiary imprisonment and w/o award for moral damages. Appellanthas
1. Whether or not CFI erred in convicting defendant-appellant despite the fact that he acted in defense of already been detained 14 years so his immediate release is ordered.
his person.
Gutierrez, dissenting. Defense of propertycan only be invoked when coupledwithform of attack on person
No. The courts concurred that the fencing and chiselling of the walls of the house of the defendant was defending property. In the case at bar, this was not so. Appellant should then be sentenced to prision
indeed a form of aggression on the part of the victim. However, this mayor. However, since he has served more than that, he should be released.
aggression was not done on the person of the victim but rather on his rights to property. On the first issue,
the courts did not err. However, in consideration of the violation of property rights, the courts referred to
Art. 30 of the civil code recognizing the right of owners to close and fence their land.

Although is not in dispute, the victim was not in the position to su bscribe to the article because his
ownership of the land being awarded by the government was still pending, therefore putting ownership
into question. It is accepted that the victim was the original aggressor.

2. WON the court erred in convicting defendant-appellant although he acted in defence of his rights.

Yes. However, the argument of the justifying circumstance of self-defense is applicable only if the 3
requirements are fulfilled. Art. 11(1) RPC enumerates these requisites:

 Unlawful aggression. In the case at bar, there was unlawful aggression towards appellant's
property rights. Fleisher had given Narvaez 6 months and he should have left him in peace
before time was up, instead of chiseling Narvaez's house and putting up fence. Art. 536 of the
Civil Code also provides that possession may not be acquired through force or intimidation;
while Art. 539 provides that every possessor has the right to be respected in his possession

 Reasonable necessity of means employed to prevent or repel attack. In the ca se, killing was
disproportionate to the attack.

G.R. No. L-29630 July 2, 1981
PHILIPPINE COMMERCIAL & INDUSTRIAL BANK, plaintiff-appellant,
vs.
PHILNABANK EMPLOYEES' ASSOCIATION, ROMEO G. ROY, DALUYONG GABRIEL, BAYANI A. BAUTISTA,
DOMINGO VILLANUEVA, ALEJANDRO RICARDO, JESUS MANAHAN, MANUEL JACINTO, ERNESTO BATAC,
LEONIDO CASPE PATRICIA GRANADOS and PANTALEON BERNARDO, defendants-appellees.
FERNANDO, C.J.:
There is a unique aspect to this action for libel against the Philip pine National Bank Employees'
Association. 1 It was filed by plaintiff Philippine Commercial and Industrial Bank as a result of placards and
signboards along the Philippine National Bank building in Escolta, Manila, containing the following: "PCIB
BAD ACCOUNTS TRANSFERRED TO PNB-NIDC?" Plaintiff considered the above "defamatory and libelous
per se for at the very least [it] amounts to an "act tending to cause dishonor, discredit, or contemptof a
juridical person." 2 The allegation of its being libelous was denied by defendants on the ground that such
placards "containing the alleged writing were displayed during the strike on April 3 and April 4,1967 as a
fair, legal labor strategy denouncing the lack of business foresight, incompetence, mismanagement,
arbitrary and despotic acts of the Management to heed the legal and legitimate demands of the
defendants, as a striking union, and against whom a strike was declared against the management of the
Philippine National Bank" 3 and that moreover, "defendants, during the strike on April 3 to April 4, 1967,
against the management of the Philippine National Bank, were only moved by good intention and
justifiable motives and did not intend to injure any party not connected with the strike;" 4 constituting part
"of their legal and fair labor strategy to enforce their demands" and to bolster their imputation of
incompetence and arbitrariness of the Philippine National Bank management. 5 The lower court sustained
such a defense and dismissed the complaint. Hence this appeal .
The decision of the then Judge Conrado Vasquez was to dismiss the complaint. He could not discernany
libelous imputation in the alleged offending words. Such a ruling finds additional support in the
sympathetic approach followed by courts to inaccuracies andimprecision inlanguage inthe use of placards
as part of peaceful picketing in labor controversies.
The facts as found by the lower court, admitted by plaintiff-appellant as correct, follow: "On April 3, 1967,
defendant Philnabank Employees' Associa tion (PEMA), a labor organization composed of the rank and file
employees of the Philippine National Bank, declared a strike. During the said strike, which lasted upto the
following day, members of the (PEMA) paraded and displayed placards in front of the PNB building at
Escolta, Manila, one of which contained the following words: "PCIB BAD ACCOUNTS TRANSFERRED TO
PNB-NIDC?" It is an admitted fact that PCIB stands for plaintiff Philippine Commercial and Industrial Bank,
while PNB refers to Philippine National Bank, and NIDC stands for National Investment Development
Corporation, a subsidiary of the PNB." 6 To prove its claim for the recovery of damages both actual and
exemplary, as well as for attorney's fees, plaintiff-appellant, as noted in the appealed decision, contended
"that the writing on the placard in question is a baseless and malicious aspersion that the plaintiff was a
party to a fraud, in that it was able to recoup on bad debts or other uncollected accounts by fraudulent,
questionable and immoral transfer thereof to the PNB or NIDC. 7 Malice was likewise at- tributed to
defendant labor union and its officers. Then the decision went on to state: "Plaintiff presented evidence
to show that it is the largest 100% Filipino commercial bank in the Philippines; that at the time of the filing
of the complaint, it had twenty-seven (27) branches all over the country and with foreign correspondent
banks throughout the world; that the assets of the plaintiff amounted to P333,417,445.05 and it handles
64
a quarterly volume of business amounting to P110,000,000.00; that it has several big companies among
its clients; and that it has a reputation for honesty, reliability and trustworthiness, and has enjoyed
domestic and international prominence and goodwill." 8 On that point, the lower court ruled: "The plaintiff
has also miserably failed to prove any damage caused to it by the supposed libelous placard subject matter
of this action. Plaintiff has admitted thatits twenty-sevenbranches atthe time of the filing of the complaint
(May 6, 1967) increased to twenty-nine branches in August of 1967. The defendants have shownthat the
number further increased to thirty-three branches as of September, 1967. Plaintiff's networth likewise
increased from P46,000,000.00 in March, 1967 to P53,000,000.00 in August, 1967. Although plaintiff's
witness Jovino Valenzuela testified that. after the display of the questioned placard, the deposits of the
plaintiff bank decreased, no record was presented to sustain this claim, which is even inconsistent with
the admission of the same witness that the Bank's networth increased since that time and has continued
to increase up to the time he testified. The same thing is true with the testimony of plaintiff's witness
Edmundo Ledesma to the effect that due to the placard in question his confidence in the plaintiff was
shaken, thereby causing him to deposit P50,000.00 with other banks instead of with the PCIB. He
admmitted moreover that, as an exporter, it was safer to be opening accounts in several banks insteadof
in only one." 9
As noted earlier, the decision must be affirmed.
1. The brief presented by the San Juan, Africa, Gonzales and San Agustin Law Offices is noted for its
exhaustive and scholarly discussion of the law on libel relying on both the Philippine and American
authorities. If the matter were viewed solely from what appeared in the placard, there is an element of
plausibility in the assertion that while it was aimed at the Philippine National Bank, the way it was worded
could reflect on a stranger to the controversy, plaintiff Philippine Commercial and Industrial Bank. It is
understandable if there were an affront to the sensibilities of its officials, They were right to guard its
reputation earned after many years of laudable and creditable performance in the field of banking.It is,
however, precisely because of its well-deserved reputation that what could at first glance be for the most
fastidious hurtful to its prestige could, if viewed with calmness and objectivity, be considered, as it was
characterized in the appealed decision, as lacking in "libelous imputation. "
2. There is, as already indicated, another reinforcement to such a mode of appraising the matter. There
was a labor controversy resulting in a strike, fortunately lasting only for one day. The labor union made
use of its constitutional right to picket. From the time of Mortera v. Court of Industrial Relations,a 1947
decision, 10 this Court has been committed to the view that peaceful picketing is part of the freedom of
speech guarantee of the Constitution. The latest case in point where such a principle was reaffirmed
expressly is Associated Labor Union v. Gomez, 11 a 1980 decision. There is no mention of the other placards
but it is not unlikely that to bolster its claim, mention was likewise made and in bold letters at thatof such
alleged failing of its management. That was the aim and intent as found by the lower court. That could not
very well be disputed by plaintiff-appellant. Unfortunately, the offending imputation, but in the form of a
question, was included. It was due to a former official of plaintiff-appellant's bank who was thereafter
named as President of the Philippine National Bank. Should there be an automatic attitude of
condemnation for such incident? If the realistic observation of Justice Frankfurter in Milk Wagon Drivers
Union of Chicago v. Meadowmoor Dairies 12 be heeded that labor disputes give rise to strong emotional
response, then the decision reached by the lower court becomes even more acceptabl e. It is a fact of
industrial life, both in the Philippines as in the United States, that in the continuing confrontation between
labor and management, it is far from likely that the language employed would be both courteous and
polite. Such being the case. there is no affront either to reason or to the law in the complaint for libel being
dismissed. In pricing reliance on the constitutional right of freedom of expression, 13 this Court once again
makes manifest its adherence to the principle first announcedby Justice Malcolmas ponente in the leading
 65

case of United States v. Bustos. 14 In no uncertain terms, it made clear that the judiciary, in deciding suits
for libel, must ascertain whether or not the alleged offending words may be embraced by the guarantees
of free speech and free press. It cannot he too often said that Bustos was promulgated as far back as March
8, 1918. A doctrine analogous in character was enunciated by the United States Supreme Court only thirty-
six years later in New York Times Co. v. Sullivan. 15

WHEREFORE, the appealed decision is affirmed. No costs.


G.R. No. 90983 September 27, 1991
LAW FIRM OF RAYMUNDO A. ARMOVIT, petitioner
vs.
COURT OF APPEALS, JUDGE GENARO C. GINES, Presiding Judge of Branch XXVI, Regional Trial Court, First
Judicial Region, San Fernando, La Union, and BENGSON COMMERCIAL BUILDING, INC.,respondents.
Raymundo A. Armovit and Rafael R. Armovit for petitioner.
Pacifico C. Yadao for private respondent.
SARMIENTO, J.:p
Before the Court is Atty. Raymundo Armovit's claim for attorney's fees against the private respondent.
It appears that Atty. Armovit was engaged as counsel for the private respondent in a complaint to have an
extrajudicial foreclosure of certain properties by the Government Service Insurance System declared null
and void; that the parties allegedly agreed that the private respondent shall pay P15,000.00 as initial
compensation and twenty percent in contingent fees; that after trial, the defunct Court of First Instance
rendered judgment annulling foreclosure and ordering the Government Service Insurance System to
restructure the private respondent's loan; that thereafter, the System appealed; the on appeal, the Court
of Appeals affirmedthe decisionof lower court; and thatthe Appellate Court's judgmen t has since attained
finality.
It also appears that when Atty. Armovit sought execution with the court a quo, he was informed by
Romualdo Bengson president of the respondent corporation, that the firm has retained the services of
Atty. Pacifico Yadao. He was also informed that the company would pay him the agreed compensation and
that Atty. Yadao's fees were covered by a separate agreement. The private respondent, however, later
ignored his billings and over the phone, directed him allegedly not to take par t in the execution
proceedings. Forthwith, he sought the entry of an attorney's lien in the records of the case. The lower
court allegedly refused to make the entry and on the contrary issued an order ordering the Philippine
National Bank to "release to the custody of Mr. Romualdo F. Bengzon and/or Atty Pacifico Yadao" 1 the
sum of P2,760,000.00 (ordered by the Court of Appeals as rentals payable by the Government Service
Insurance System).
Atty. Armovit then moved, apparently for the hearing of hi motion t o recognize attorney's lien, and
thereafter, the trial court. issued an order in the tenor as follows:
When this case was called for hearing on the petition to record attorney's charging lien, Attys. Armovit and
Aglipay appeared for the petitioners.
Atty. Armovit informed the Court that they are withdrawing the petition considering that they are inthe
process of amicably settling their differences with the plaintiff, which manifestation was confirmed by
Atty. Yadao as well as the plaintiffs, Romualdo Bengson and Brenda Bengson, who are present today.
In view of this development, the petition to record attorney charging lien, the same being in order and not
contrary to law, moral and public policy, as prayed for by Attys. Armovit and Aglipay, it hereby withdrawn.
The parties, therefore are hereby directed to co ply faithfully with their respective obligations.
66
SO ORDERED. 2
However, upon the turnover of the money to the private respondent, Mrs. Brenda Bengson (wife of
Romualdo Bengzon delivered to Atty. Armovit the sum of P300,000.00 only. Armovit protested and
demanded the amount of P552,000.0 twenty percent of P2,760,000.00), for which Mrs. Bengzon made
assurances that he will be paid the balance.
On November 4, 1988, however, Atty. Armovit received a order emanating from the trial court in the tenor
as follows:
During the hearing on the petition to record attorney's charge lien on October 11, 1988, Attys. Armovit
and Aglipay withdrew their petition to record attorney's charging lien, which was duly approve petition to
recordby the Court, after which the Court directed the parties to comp faithfully with their respective
obligations.
In compliance with the Order of this Court, the plaintiff submitted a pleading denominated as compliance
alleging that petition (Atty. Armovit) has already received from the plaintiff the sum P300,000.00,
Philippine Currency, as and by way of attorney's fees With the receipt by the petitioner from the plaintiff
of this amount, the latter has faithfully complied with its obligation.
WHEREFORE, the Order of this Court dated October 11, 1988 approving the withdrawal of the petition to
record attorney's charging lien, on motion of the petitioner, is now final.
SO ORDERED. 3
Reconsideration having been denied, Atty. Armovit went the Court of Appeals on a petition for certiorari
and prohibition.
On August 25, 1989, the Court of Appeals 4 rendered judgment dismissing the petition. Reconsideration
having been likewise denied by the Appellate Court, Atty. Armovit instituted the instant appeal .
Shortly thereafter, we required the private respondent comment.
The private respondent did not materially traverse Atty. Armorvit's chronicle of events but added: that the
private respondent hired the petitioner after the Government Service Insurance System had answered and
that it was Atty. Benjam Bernardino who prepared the complaint; that for his appearances, Atty. Armovit
was paid a total of P108,000.00, not to mention "beach resort accommodations"; 5 that Atty. Armovitdid
not inform the private respondent thatthe court had rendered judgmentwhichthey would have appealed;
that they lost an appeal on account of Atty. Armovit's indiscretion; that the forthwith engaged the services
of another lawyer, Atty. Yadao; and that it was the latter who prepared the brief in the Court Appeals (on
GSIS's appeal).
The private respondent also alleged that it opposed Atty. Armovit's effort to record his attorney's lien on
grounds of allege nullity of the retainer agreement, Atty. Armovit's negligence and because of e xcessive
fees demanded.
The private respondent also insisted that the retainer agreement was signed by only one of seven
directors, and it could no bind the corporation. Atty. Armovit, in any event, had also been allegedly more
than sufficiently compensated.

The private respondent alleged that Atty. Armovit had bee paid P300,000.00 — an amount approvedby
the court, and an amount he accepted and for which he is allegedly estoppel from claiming a higher
amount. The order of the court has the effect of res judicata, the private respondent claimed, as well as a
compromise agreement which is immediately executory.
The disposition of the Court of Appeals was that since the receipt evidencing payment to Atty. Armovitof
the sum P300,000.00 "was without any qualification as 'advance' 'partial' or 'incomplete'," 6 the intention
of the parties was that was full payment. The Appellate Court also noted Atty. Armorvit's withdrawal of
his motion to record attorney's lien and figured that Atty. Armovit was satisfied with t he payment
P300,000,00.
The only issue is whether or not Atty. Armovit is entitled to the sum of P252,000.00 more, in addition to
the sum P300,000.00 already paid him by the private respondent.There is no question that the parties had
agreed on a compensation as follows:
a) P15,000.00 by way of acceptance and study fee, payable within five (5) days from date;
b) 20% contingent fee computed on the value to be recovered b favorable judgment in the cases; and
c) the execution and signing of a final retainer agreement complete with all necessary details. 7
(While the parties' agreement speaks of "a final retain agreement" 8 to be executed later, it does not
appear that the parties did enter into a "final" agreement thereafter.)
The private respondent's version however is that while it may be true that the agreed compensationwas
twenty percent of all recoveries, the parties later agreed on a compromise sum approved allegedly by the
trial court, per its Order of October 11, 1988.
The Court is inclined to believe that Atty. Armovit never agreed on the compromise sum of P300,000.00.
It is true that he did agree to withdraw his motion to annotate attorney's lien, but because the parties
were "in the process of amicably settling their differences" 9 and not because Atty. Armovit had agreed to
accept a lower amount as full payment. There is nothing, on top of that, Atty. Armovit's manifestation that
would suggest that he was accepting the sum of P300,00.00 as agreed final payment, other than the fact
that an agreement was supposedly certain. We quote:
ATTY. ARMOVIT:
Your Honor, we would like to manifest in Court that we served notice to the counsel of the plaintiff,
Bengson Commercial Building, a copy of the petition to record attorney's charging lien, and together with
the president of the corporation, Mr. Romualdo Bengson, and his wife, Mrs. Brenda Bengson, we have
discussed the problem and we all agreed upon is an earnest one at this time, this representation is
withdrawing his petition to record charging lien.
ATTY. YADAO:
No objection, Your Honor, because we have to agree with Atty. Armovit. I am in full accord with this. 10
There is nothing there that would indicate Atty. Armovit's willingness to accept, in fact, a lower figure in
consideration of his withdrawal of his request to enter attorney's lien. What the Court takes his statement
to mean is that he was withdrawing his request on the certainty that the private respondent would pay
him the money, presumably, under more becoming circumstances.
67
The Court does not therefore see how the private respondent can hold Atty. Armovit to have been in
estoppel.
The fact that Atty. Armovit did not, after all, accept the sum of P300,000.00 as final compensation is indeed
indicated by the behavior of the private respondent, through Mrs. Romualdo Bengson, when she assured
Atty. Armovit that the balance was forthcoming. 11 According to Mrs. Bengson, she wished the restof the
Bengsons to witness the final payment and when the occasion was present, wished for a postponement
on account of "All Saints Day."12
The parties never therefore amended their original agreement, and what appears to the Courtis a clear
effort on the part of a client, with the apparent approval of the trial court, to renege on a valid agreement
with its lawyer.
The Court believes that the trial court, in accepting the private respondent's "compliance" as a final
payment of Atty. Armovit's fees, was guilty of a grave abuse of discretion. The private respondent had
nothing with which to comply, and the parties, as manifested by Atty. Armovit, were "in the process
[merely] of amicably settling their differences." 13
It is apparent furthermore that the trial judge himself was out to deny Atty. Armovit the agreed
compensation. In his order of October 4, 1988, he commanded:
The PNB is hereby ordered and directed to release to the custody of Mr. Romualdo F. Bengson and /or
Atty. Pacifico Yadao, counsel for the plaintiff, the sum of Two Million Seven Hundred Sixty Thousand Pesos
(P2,760,000.00), Philippine Currency for the satisfaction of the rentals of the Bengson Building against the
GSIS. 14
in spite of the fact that Atty. Armovit had remained the private respondent's counsel of record. It is
fundamental that unless a lawyer has been validly discharged, his authority to a ct for his client continues
and should be recognized by the court. 15
The fact that the receipt evidencing payment by the private respondent of the amount of P300,000.00
"was without any qualification as 'advance' or 'partial' or 'incomplete'," 16 as the Court of Appeals noted
and the Court of Appeals took to mean "full payment", will not weaken Atty. Armovit's demand for the
balance. There is nothing in the receipt that will suggest that will suggest that it was full payment either,
and the fact that Atty. Armovit accepted it does not mean that he was satisfied that it was final payment.
The fact of the matter is that the private respondent had assured him that the balance was forthcoming.
The private respondent can not justifiably downplay Atty. Armovit as negligent (for failing to appeal) or his
demand for fees excessive (that he had been paid enough). Atty. Armovit, after all, succeeded in obtaining
a favorable decision for his client, an although his prayer for various damages were denied, he secceeded
in obtaining a substantial award (P1,900,00.00 in unpaid rentals) for his client. On appeal, the Court of
Appeals sustained his theory. It should be noted that the private respondent had in fact stood to lose
substantial properties on foreclosure — Atty. Armovit not only restored to the private respondent its
foreclosured properties, he succeeded in having the private respondent's loans restructed and the
Government Service Insurance System pay rentals. No client can ask a better result from a lawyer.
Obviously, the private respondent's effort to downgrade Atty. Armovit's performance is a wild, if not
cheap, shot of a client out to evade its obligations to its lawyer. The fact that Atty. Armovit may have been
paid substantially (in initial fees) while the case was dragging is no justification for denying him the full
 68

amount under their agreement. It has been held that initial fees and fees paid in the progress of litigation
are independent of the contingent fees. 17

That the retainer agreement was never approved by the board of the corporation is also a poor excuse
because the fact of the matter is that the private respondent did deliver to Atty. Armovit the sum of
P300,000.00 in partial payment, andthe private respondent can not nowdeny himthe balance bayalleging
lack of authority of the Bengson spouses.

Contingent fees are valid in this jurisdiction. 18 It is true that attorney's fees must at all times be
reasonable; 19however, we do not find Atty. Armovit's claim for "twenty percent of all recoveries" to be
unreasonable. In the case of Aro v. Nañawa, 20 decided in 1969, this Court awarded the agreed fees amid
the efforts of the client to deny him fees by terminating his services. In parallel vein, we are upholding
Atty. Armovit's claim for P252,000.00 more — pursuant to the contingent fee agreement — amid the
private respondent's own endeavours to evade its obligations.

Several times, we have come down hard on erring practitioners. We will not however be slow either, in
coming to the rescue of aggrieved brother-lawyers in protecting the integrity of the bar from unscrupulous
litigants.

WHEREFORE, premises considered, the petition is GRANTED. The private respondent is ORDERED to pay
the petitioner the sum of P252,000.00. Costs against the private respondent.

IT IS SO ORDERED.

[G.R. No. 159482. August 30, 2005]
NICASIO P. RODRIGUEZ JR., ANTONIO P. EREETA, JUANITO A. MAGNO, VICTOR C. PINEDA, BITUIN V.
SALCEDO, CESAR R. SAN DIEGO, VICTOR V. TANTOCO and AMADOR C. DE LA MERCED, petitioners, vs.
ANTONIO L. AGUILAR SR., respondent.
D E C I S I ON
PANGANIBAN, J.:
Claims for moral and exemplary damages arising from employer-employee relations fall within the original
and exclusive jurisdiction of the National Labor Relations Commission, not the regular courts. Hence, in
the present case, the trial court should not have entertained the Complaint filed by respondent for
damages arising from the alleged oppressive manner of his dismissal by petitioners.
The Case
Before the Court is a Petition for Review [1] under Rule 45 of the Rules of Court, seeking to reverse and set
aside the March 31, 2003 Decision[2] of the Court of Appeals (CA) in CA-GR SP No. 74278 and its August 5,
2003 Resolution [3] denying petitioners Motion for Reconsideration. The assailed CA Decision disposed as
follows:
WHEREFORE, for lack of merit, the petition is DISMISSED.[4]
The Facts
The antecedents were summarized by the CA as follows:
Petitioners are members of the Board of Directors of Philippine Postal Savings Bank, Inc. (PPSBI) at
Liwasang Bonifacio, Manila; private respondent Antonio L. Aguilar was employed as Vice President of its
Finance and Administrative Group from February 14, 2000 to January 31, 2001, and thereafter as
Compliance Officer until September 26, 2001 when his services were terminated.
On October 25, 2001, private respondent filed a complaint against petitioners with the Regional Trial
Court, Branch 49, City of Manila alleging that he was illegally dismissed by the petitioners in an oppressive
way; that the cause of his dismissal was his principled act of exposing anomalies in the bank; that
considering the seriousness of the violations of internal control and bank policies, there is a need to
prohibit petitioners from performing their functions as members of the Board in their own personal
capacity. He prayed for the award of damages, the issuance of a temporary restraining order enjoining the
petitioners from dismissing him or in the alternative, to immediately reinstate him, and the prohibitionof
the petitioners from performing their personal and official acts in the bank.
On October 29, 2001, public respondent Judge motu proprio dismissed the complaint for lack of
jurisdiction stating that jurisdiction over the case lies with the Labor Arbiter of the National Labor Relations
Commission.
Unaware of the dismissal[,] petitioners, on November 9, 2001, filed a Motion to Dismiss private
respondents complaint on the ground of the RTCs lack of jurisdiction over the subject matter of the
complaint.
On November 12, 2001, private respondent filed a Motion for Reconsideration of the Order dated 29
October 2001. However, on November 26, 2001, he filed an Ex-Parte Motion to Withdraw Motion For
69
Reconsideration of the Dismissal Order and In Lieu Thereof to Submit Amended Complaint, which was
attached thereto. In his Amended Complaint, he emphasized that his dismissal (constructive and actual)
was done in a very oppressive manner. His prayer for reinstatement was deleted.
In an Order dated January 4, 2002, public respondent Judge admitted the Amended Complaint reasoning
that amendment was a matter of right before defendants filed a responsive pleading, the motionto dismiss
not being a responsive pleading. Petitioners were ordered to file their Answer within fifteen (15) days from
receipt thereof.
On January 30, 2002, without filing a Motion for Reconsideration of the above Order, petitioners again
filed a Motion to Dismiss, this time of the Amended Complaint, on the ground of lack of jurisdictionover
the persons of the petitioners and over the subject matter of the claim.
In an Order dated February 8, 2002, public respondent Judge ruled that petitioners filing of the above
Motion to Dismiss was tantamount to a voluntary appearance through a pleading that vested the court
with jurisdiction over their persons. Petitioners were given an additional ten (10) days within which to
submit an Answer, otherwise, said defendants (herein petitioners), may be declared in default.
Petitioners then filed a Motion for Reconsideration dated February 15, 2002, reiterating their prayer for
the dismissal of the Amended Complaint. This was denied in the Order dated March 1, 2002.
On April 4, 2002, respondent filed a Motion to Declare Defendants As in Default and For Judgment On the
Pleadings grounded on petitioners failure to file their Answer within the additional ten (10)-day period
granted by the court. Citing Ortigas & Co. Ltd. v. Velasco (254 SCRA 234), public respondent noted that
defendants were heedless and unyielding to the Orders of the Court particularly its directive to file an
Answer to the Amended Complaint and that the defendants continually ignored and refused to submit to
the Orders of the Court, and inasmuch as no responsive pleading has been filed by them within the period
fixed by the Court in its Order dated June 7, 2002 which granted respondents motion and declared
defendants-petitioners in default.
On the 15 th day from receipt thereof on June 19, 2002, petitioners filed on July 1, 2002 an ordinary Motion
for Reconsideration on the above Order, (not a Motion to Set Aside the Order of Default under Rule 9 Sec.
3(b), Rules of Civil Procedure) which was denied in an Order dated July 19, 2002.
On the same date of July 19, 2002, public respondent issued the assailed decision (Judgment by Default)
in favor of the private respondent ratiocinating as follows:
The Court shall not delve into the legality of Mr. Aguilars demotion and, l ater on, dismissal by the PPSB
Board of Directors for to do so would intrude into the jurisdiction of the Labor Arbiters of the National
Labor Relations Commission. Rather, this Court shall concern itself with the manner in which the said
demotion and dismissal were carried out and the consequent effects thereof, which, as jurisprudence
teaches us, are well within this Courts jurisdiction to inquire into.
From the foregoing, confluence of events, which stand unrebutted the defendants having been declared
in default, there can be no question that Mr. Aguilars demotion and dismissal from service was pursuedin
a highly abusive, oppressive and clearly anti-social manner.
On August 7, 2002, petitioners filed an Omnibus Motion contending that the Order of Default did not
deprive them of their right to notice, which public respondent violated when private respondents evidence
was received without notifying them; that the presentation of evidence ex parte was premature
considering that they were still entitled to question the propriety of the Order of Default and that, infact,

they filed a motion for reconsideration of the Order of default. Petitioners reiterated that the Amended
Complaint was filed out of time considering that the Order of Dismissal dated 29 Octobe r 2001 had already
became final. On August 16, 2002, the public respondent issued the assailed Order denying the Omnibus
Motion.[5]
Petitioners filed before the CA a Petition for Certiorari under Rule 65, challenging the July 19, 2002
Decision and the August 16, 2002 Order of the Regional Trial Court (RTC), alleging that it had gravely
abused its discretion in the following ways:
1. Holding that Mr. Aguilars ex parte withdrawal of his Motion for Reconsideration of the Order of
Dismissal did not cause it to become final and executory.
2. Taking cognizance of the Amended Complaint because [private respondent] had deleted his prayers for
the other reliefs that fall within the jurisdiction of the labor court.
3. Declaring [petitioners] in default and in allowing the presentation of and receiving [private respondents]
evidence ex parte in violation of the Rules. [6]
Petitioners prayed that the lower courts judgment by default, as well as said courts all other orders and
findings after its Order of dismissal of the original Complaint[,] be reversed and set aside, and that the case
in question be dismissed for lack of jurisdiction and for having been decided in violation of the Rules. [7]
Ruling of the Court of Appeals
Agreeing with the RTC, the CA held that the withdrawal of the Motion for Reconsideration filed by
respondent had not resulted in the finality of the Dismissal Order dated October 29, 2001, since he had
simultaneously amended his Complaint. This he had every right to do, said the CA, because no responsive
pleading had yet been filed by petitioners. It opined that the Amended Complaint superseded his original
Complaint and mooted the issue raised in his Motion for Reconsideration. It further said that the rules on
the amendment of pleadings may be liberally construed to avoid a multiplicity of suits; and to ensure that
the real controversies between the parties would be presented, their rights determined, and the case
decided on the merits without unnecessary delay.
The CA likewise ruled that the RTC had jurisdiction over the case, because of the civil nature of the cause
of action; that is, the alleged oppressive manner of respondents dismissal that had resulted in damages.
Lastly, the CA found no grave abuse of discretion on the part of the RTC in declaring petitioners in default,
then afterwards receiving ex parte the evidence presented by respondent, and rendering a judgment of
default. The appellate court stressed that as early as the January 4, 2002 Order, the RTC had directed
petitioners to answer the Amended Complaint. The trial court reiterated the directive in the February 8,
2002 Order, with a warning that if they failed to answer within ten days, they would be declared in default.
The two Orders, which petitioners had not challenged either by a motion for reconsideration or by a
petition for certiorari, thus attained finality. According to the CA, their prayer for the dismissal of the
Amended Complaint was reiterated in both their Omnibus Motion filed after the de nial on January 30,
2002, of their Motion to Dismiss the Amended Complaint, as well as in their subsequent Motions for
Reconsideration. These amounted to multiple motions for reconsideration, which are proscribed under
Section 5 of Rule 37 of the Rules of Civil Procedure.
As to the ex parte reception of respondents evidence, the CA pointed out that under Section 3 of Rule 9,
the court may proceed to render judgment based entirely on the plaintiffs Complaint without need of
70
receiving evidence. If so, the appellate court said, it would be reasonable to conclude that petitioners did
not have any demandable right to be given notice of the ex parte reception of respondents evidence.
Hence, this Petition. [8]
Issues
Petitioners raise the following issues for our consideration:
I.
The Honorable Court of Appeals erred in sustaining the finding of the trial court that Mr. Aguilars ex
parte withdrawal of his Motion for Reconsideration of the Order of dismissal of the original Complaint did
not cause said Order to become final and executory.
II.
The Honorable Court of Appeals erred in sustaining the trial court that it could allow the amendment of
the original Complaint purely as a matter of right before a responsive pleading is filed, despite prevailing
jurisprudence to the contrary.
III.
The Honorable Court of Appeals erred in sustaining that the trial court could take cognizance of Mr.
Aguilars Amended Complaint because it had deleted the prayers for other reliefs that fall within the
jurisdiction of the National Labor Relations Commission.
IV.
The Honorable Court of Appeals erred in sustaining the trial court that it could receive Mr. Aguilars
evidence ex parte without notice to petitioners despite pertinent rules and jurisprudence to the
contrary. [9]
In brief, the issues are as follows: (1) What are the effects of the withdrawal of the Motion for
Reconsideration of the RTCs dismissal of the Complaint? (2) Did the RTC have jurisdiction over the
Amended Complaint?
The Courts Ruling
The Petition is meritorious.
First Issue:
Withdrawal of the Motion for Reconsideration
It is settled that an amendment of a complaint may be allowed even if an order for its dismissal has been
issued, as long as the motion to amend is filed before the dismissal order becomes final.[10] The reason for
allowing the amendment on this condition is that, upon finality of the dismissal, the court loses jurisdiction
and control over the complaint. Thus, it can no longer make any disposition on the complaint in a manner
inconsistent with the dismissal. [11]After the order of dismissal without prejudice becomes final, and
therefore falls outside the courts power to modify, a party who wishes to reinstate the case has no remedy
other than to file a new complaint. [12]

The instant case deals with a Motion for Reconsideration [13] of the trial courts Order dismissing the case
for lack of jurisdiction. The Motion was filed on November13, 2001, withinthe 15-day reglementaryperiod
for appeal,[14] and later withdrawn and substituted with a Motion to Admit Amended Complaint.
Petitioners contention is that the withdrawal of the Motion for Re consideration would have a retroactive
effect, such that it would be as if no motion had been filed at all; and, hence, the Motion for Admissionof
the Amended Complaint -- filed beyond the 15-day reglementary period, after the dismissal had become
final -- should no longer be entertained, much less admitted.
The trial court accepted the Amended Complaint and held that the dismissal Order had not attained
finality, because the 15-day reglementary period under the Rules had tolled upon the filing of the Motion
for Reconsideration; and would begin to run again only after the party concerned would have received the
courts Resolution on the Motion. [15] As it had not yet ruled on the Motion for Reconsideration when
respondent filed his Amended Complaint, the trial court opined that the Amended Complaint may be
deemed to have been filed within the prescribed time.
We rule otherwise. The trial court erroneously admitted the Amended Complaint. Upon the withdrawal
by respondent of his Motion for Reconsideration, it was as if no motion had been filed. Hence, the Order
of the trial court under question became final and executory 15 days from notice by the party concerned.
In the same manner that the withdrawal of an appeal has the effect of rendering the appealed
decision [16] final and executory, the withdrawal of the Motion for Reconsideration in the presentcase had
the effect of rendering the dismissal Order final and executory. By then, there was no more complaint that
could be amended, even for the first time as a matter of right.
Notably, respondent does not refute petitioners argument that his Motion for Admission of his Amended
Complaint was filed after the lapse of the 15-day reglementary period to reconsider or set aside the
dismissal. What he insists upon is his contention that the Order of dismissal did not become final and
executory, because the Motion for Reconsideration had not yet been resolved at the time he filed his
Amended Complaint.
By way of analogy, petitioners cite Olympia International v. Court of Appeals, [17] in which the plaintiffs two
civil actions were dismissed by the trial court on a joint Motion to Dismiss filed by the plaintiff and the
defendant:
It is equally important to note that the right to file a new action in this case has long prescribed, for while
the commencement of a civil action stops the running of the statute of prescription or limitations, its
dismissal or voluntary abandonment by the plaintiff leaves the parties in exactly the same position as
though no action had been commenced at all. The commencement of an action, by reason of its dismissal
or abandonment, takes no time out of the period of prescription. [18]
In like manner, while the filing of the Motion for Reconsideration interrupted the running of the 15-day
reglementary period, its withdrawal left respondent in exactly the same position as though no motion had
been filed at all. The withdrawal of the Motion for Reconsideration effectively erased the tolling of the
reglementary period to amend the Complaint.
Second Issue:
Jurisdiction
71
Under Article 217(a) of the Labor Code, as amended by Republic Act No. 6715 which took effect onMarch
21, 1989, labor arbiters shall have original and exclusive jurisdiction to hear and decide: [c]laims for actual,
moral, exemplary and other forms of damages arising from the employer-employee relations x x x.
Clearly, in the case before us, respondents claim for damages against petitioners arose from a prior
employer-employee relationship. The averments in the Complaint indisputably show that his claim for
damages was anchored on and was a consequence of the termination of his employment with PPSBI.
Indeed, the trial court initially made this observation when it dismissed motu proprio respondents
Complaint.[19] It ruled that the manner in which the dismissal was implemented was anti-social, oppressive
and in disregard of procedural due process x x x is but an incident part and parcel of the main issue which
is the alleged illegal dismissal of [respondent]. The trial court likewise opined that the plea of respondent
for reinstatement made his case one of illegal dismissal per se.
Later, however, it reversed its dismissal Order after he subsequently amended his Complaint by deleting
his prayer for reinstatement and by stressing that his claim for damages had resulted from the alleged
oppressive manner of his dismissal.
The trial court should have dismissed the Amended Complaint. With regard to claims for damages under
paragraph 4 of Article 217, quoted above, jurisprudence has applied the reasonable connection rule: if
there is a reasonable causal connection between the claim asserted and the employer-employee relations,
then the case falls within the jurisdiction of the labor arbiter.[20] We do not agree with the trial courtthat
the case became a civil dispute simply because respondent had not asked for reinstatement in his
Amended Complaint. An employee need not seek reinstatement in order to have a complaint heard by the
labor arbiter. [21]
A comparison of the original[22] and the Amended Complaint [23] reveals that the allegations and the prayers
in both are almost identical, except that the prayer for reinstatement and the claim for salary increases
and allowances are no longer included in the Amended Complaint. These are telltale signs that the claim
of respondent for damages is intertwined with his separation from his employment, allegedly without a
just cause. Consequently, his claim has a reasonable causal connection with his employer-employee
relations with the bank.
The Court is aware that the Civil Code provisions on human relations and damages may be used as bases
for justifying his claim. But, the fact remains: the present action primarily involves an employer-employee
relationship. The damages he incurred are mere consequences of the alleged injury brought about by his
perceived illegal dismissal. The civil ramifications of his actual claim cannot alter the reality that it is
primordially a labor matter cognizable by the labor tribunals.
Under Article 217 (a) of the Labor Code, the labor arbiter has the jurisdiction to award to a dismissed
employee not only the reliefs provided by the Labor Code, but also moral and other forms of damages
governed by the Civil Code. [24] Although a dismissal from employment may be a violation not only of the
Labor but also of the Civil Code,[25] an illegally dismissed employee has only a single cause of action.
Moral damages are recoverable when, for example, the dismissal was effected without an au thorized
cause and/or due process -- for which relief is granted by the Labor Code -- and also when the dismissal
(1) was attended by bad faith or fraud; (2) constituted an act oppressive to labor; or (3) was done in a
manner contrary to morals, good customs or public policy. For any of these, the obtainable relief is
determined by the Civil Code. [26]
 72

This Court expounded on this matter in the earlier case Primero v. Intermediate Appellate Court,[27] which splitting the cause of action and possible conflicting findings and conclusions by two tribunals on one and
we quote: the same claim.

It is clear that the question of the legality of the act of dismissal is intimately related to the issue of the Presently, as amended by RA 6715, the jurisdiction of the NLRC under Article 217 of the Labor Code is
legality of the manner by which that act of dismissal was performed.But while the Labor Code treats of the comprehensive enough to include claims for all forms of damages arising from the employer-employee
nature of, and the remedy available as regards the first the employees separation from employment it relations.
does not at all deal with the second the manner of that separation which is governed exclusively by the
Civil Code. In addressing the first issue, the Labor Arbiter applies the Labor Code; in addressing the second, WHEREFORE, the Petition is GRANTED, and the assailed Decision REVERSED and SET ASIDE. The Amended
the Civil Code. And this appears to be the plain and patent intendment of the law. For apart from the reliefs Complaint in Civil Case No. 01102147, filed with the Regional Trial Court (Branch 49) of the City of Manila,
expressly set out in the Labor Code flowing from illegal dismissal from employment, no is hereby DISMISSED. No pronouncement as to costs.
other damages may be awarded to an illegally dismissed employee other than those specified by the Civil
SO ORDERED.
Code. Hence, the fact that the issue of whether or not moral or other damages were suffered by an
employee and in the affirmative, the amount that should properly be awarded to him in the circumstances
is determined under the provisions of the Civil Code and not the Labor Code, obviousl y was notmeant to
create a cause of action independent of that for illegal dismissal and thus place the matter beyond the
Labor Arbiters jurisdiction.

Hence, for a single cause of action, the dismissed employee cannot be allowed to sue in two forums: one,
before the labor arbiter for reinstatement and recovery of back wages or for separation pay, upon the
theory that the dismissal was illegal; and two, before a court of justice for recovery of moral and other
damages, upon the theory that the manner of dis missal was unduly injurious or tortious. Suing in the
manner described is known as splitting a cause of action, a practice engendering a multiplicity of actions.
It is considered procedurally unsound and obnoxious to the orderly administration of justice.

Splitting a cause of action was precisely what private respondent did in filing the Amended Complaint.He
split his cause of action, then made one of the split parts the subject of his Amended Complaint before a
court of justice.

Precisely, such duplicity prodded the lawmakers to amend the Labor Code by restoring to the labor arbiters
the jurisdiction over claims for damages of this nature. From 1979 to 1980, jurisdiction over employment-
predicated actions for damages vacillated from labor tribunals to regular courts, and back to labor
tribunals.

On May 1, 1979, Presidential Decree No. 1367 amended the then existing Article 217[28] of the Labor Code
to the effect that [r]egional Directors shall not indorse and Labor Arbiters shall not entertain claims for
moral or other forms of damages. [29] But this limitation of jurisdiction did not last long, because on May 1,
1980, PD 1691[30] nullified PD 1367 and restored Article 217 of the Labor Code almost to its original form.
PD 1691 once again vested in the labor arbiters and the NLRC the jurisdiction over all money claims of
workers and all other claims arising from employer-employee relations, including moral and exemplary
damages. [31] In Ebon v. De Guzman,[32] this Court explained:

The lawmaker in divesting the Labor Arbiters and the NLRC of jurisdiction to award moral and other forms
of damages in labor cases could have assumed that the Labor Arbiters position-paper procedure of
ascertaining the facts in dispute might not be an adequate tool for arriving at a just and accurate
assessment of damages, as distinguished from backwages and separation pay, and that the trial
procedure in the Court of First Instance [now Regional Trial Court] would be a more effective means of
determining such damages. x x x

Evidently, the lawmaking authority had second thoughts about depriving the Labor Arbiters and the NLRC
of the jurisdiction to award damages in labor cases because that set up would mean duplicity of suits,

AGUILAR VS BURGER MACHINE
Assailed in this petition is the December 20, 2005 Decision [1] of the Court of Appeals in CA-G.R. SP No.
87910 which declared that petitioner Lorenzo Ma. D.G. Aguilar was not constructively dismissed; and
which set aside the May 27, 2003 [2] Decision of the Labor Arbiter as well as the May 25, 2004
Resolution[3] of the National Labor Relations Commission (NLRC) both holding that petitioner was
constructively dismissed.
The facts show that respondent Burger Machine Holdings Corporation (Burger Machine) is a domestic
corporation engaged in the business of food service. Respondents Caesar B. Rodriguez, Fe Esperanza S.
Rodriguez, and Melchor V. De Jesus, Jr., (De Jesus) are Burger Machines Chairperson, President, and Vice-
President, respectively.
On September 26, 2000, Burger Machine hired petitioner as a Strategic Business Unit Manager
Trainee. On March 26, 2001 he was regularized and assigned as Profit Center Manager of the Burger
Machine North Corporation (BMNC) and the overseer of the Central Luzon Food Corporation (CLFC) and
the Eastern Luzon Food Corporation (ELFC). He was likewise tasked to spearhead the expansion of their
outlets inBaguio City.
On June 26, 2001, petitioner was commended for his valuable assistance and guidance to the trainee
managers of CLFC and ELFC. [4] This was followed by anothercommendationon July 6, 2001 for his guidance
to the trainee-manager of CLFC in achieving the following: (a) highest NIBT as of May; (b) 2 nd Best ROI; (c)
3 rd Highest ADS; (d) 3 rd Highest Sales Growth as of May; (e) JanuaryMay Bad Debts of .5% of Net Sales; and
(f) Fastest Expanding Profit Center. [5]
On October 9, 2001, however, Burger Machine released the results of the audit of BMNCs operation
showing that petitioner had not complied with the companys purchasing system policy manual and that
he made several purchases, the amounts of which were beyond his authority to approve. [6] In reply
thereto, petitioner attributed the lapses in the approval of purchases to the lack of information on the
standard operating procedures of the company.
On October 17, 2001, De Jesus directed petitioner to cease from overseeing the CLFC and ELFC and to
concentrate on BMNC to resolve faster all critical problems such as shortages, low ADS, low promo
compliance, etc. [7] On November 19, 2001, De Jesus ordered him to reduce his gross sales shortages to1%
or less by the end of November 2001. [8] Petitioner was able to reduce this shortage to as low as 0.86% for
the month of November. [9]
At the end of the year 2001, petitioner did not receive his 14 th month pay bonus of P35,000.00 while the
amount of P15,291.00 representing the alleged unauthorized expenses was deducted from his salary.
73
On March 7, 2002, De Jesus ordered petitioner to turn over BMNC to Ms. Gloria Centino starting March 12
up to the end of March. [10] No reason was stated in the directive, neither was a new assignment given to
petitioner, thus he wrote a letter to respondentCaesarB. Rodriguez, seeking an explanation for the actions
of De Jesus, to wit:
Considering that my accomplishments and contribution to the company have been acknowledgedby my
superiors, and my colleagues as well, it is a puzzle to me why Sir [De Jesus] in a series of dialogues I have
had with him since September 2001 conveyed, reiterated, and insisted that I resign under your strict and
unbending personal instructions. This turn of events have caused me and my whole family: many sleepless
night, anxiety, stress, and tremendous pressure. Today, tragedy struck my whole family when my wife lost
our fourth child, a baby daughter, five-months on the way to maternity. I have, however, continued to give
my best and undivided service and commitment to my job and to the company, in spite of the constant
fear that at anytime, I may have to leave my job against my will. [11]
After the turn over of BMNC, petitioner went on an approved leave of absence. On April 23, 2002, he was
appointed as Profit Center Manager of Tatyana Foods Corporation (TFC), a new project of Burger Machine
to be established in La Union, Ilocos Sur, Ilocos Norte, Cagayan and Isabela. [12] Petitioner accepted the
appointment and started scouting for the area in connection with the business plan.
On May 14, 2002, De Jesus informed petitioner that he would instead be transferred to the National
Capital Region (NCR) to oversee the operations of the Peoples Dimsum (PD). On May 17, 2002, petitioner
figured in an accident while on his way to De Jesus office in Metro Manila.He was thus hospitalized and
was constrained to go on leave. He requested for cash advance and financial assistance from the company
for his medical expenses but was denied.
On July 5, 2002, petitioner reported for work. On July 16, 2002, De Jesus issued a memorandum directing
him to report at the Epifanio de los Santos Avenue (EDSA) office of Burger Machine on July 17,2002 and
onwards from 9:00 a.m. up to 6:00 p.m. [13]
On July 17, 2002, petitioner filed a complaint for constructive dismissal contending that the totality of
respondents conduct constitutes harassment aimed to pressure him to resign from his job. Respondents,
on the other hand, alleged that the transfer of the BMNC operations to Centino was due to petitioners
repeated failure to achieve the passing rate for quality food service control; that despite of this gross
inefficiency, he was given a new assignment; that the delay in assigning him to a new Profit Center was
due to his irregular attendance; that he was not able to assume his responsibility as Profit Center Manager
of TFC because of his failure to go back to work and his unreasonable demands; and that petitioners
continued absence prompted them to assign him at the EDSA office starting July 17, 2002. [14]
In its decision dated May 27, 2003, the Labor Arbiter ruled that petitioner was constructively dismissed
and that respondent corporate officials of Burger Machine are solidarily liable with the latter for
petitioners monetary awards. The dispositive portion thereof, reads:
CONFORMABLY WITH THE FOREGOING, judgment is hereby rendered finding complainant to have been
illegally dismissed albeit constructively. Consequently, he should be reinstated immediately as Profit
[Center] Manager and paid by respondent[s] in solidum, his backwages, which as of May 16, 2003 has
already accumulated in the sum of P350,000.00.
In addition respondents, are solidarily ordered to pay complainan t,
a) His 14 th month pay for 2002;

b) P500,000.00 as moral damages[;]
c) P350,000.00 as exemplary damages; and
d) 10% of the money awards for and as attorneys fees.
SO ORDERED.[15]
The foregoing decision was affirmed by the NLRC in its resolution dated May 25, 2004. Respondents filed
a motion for reconsideration but was denied on September 17, 2004. On petition to the Court of Appeals,
the latter reversed the finding of the NLRC and held that there was no constructive dismissal because
petitioners transfer to PD was without change in rank and salary and was not shown to be humiliating and
prejudicial to petitioner. The decretal portion thereof, states:
WHEREFORE, upon the premises, the petition is GRANTED and the Decision dated May 27, 2003 of the
Labor Arbiter, the [Resolution] dated May 25, 2004, and the Resolution dated September 17, 2004 of the
NLRC are REVERSED and SET ASIDE. Private respondents Complaint for constructive dismissal is
DISMISSED.
SO ORDERED.[16]
Hence, the instant petition.
The issue for resolution is whether petitioner was constructivel y dismissed.
The Court rules in the affirmative.
Constructive dismissal exists as an involuntary resignation on the part of the employee due to the harsh,
hostile and unfavorable conditions set by the employer. In other words, it is an act amounting todismissal
but made to appear as if it were not. In fact, the employee who is constructively dismissed may be allowed
to keep on coming to work. Constructive dismissal is therefore a dismissal in disguise. It is broughtabout
where there is clear discrimination, insensibility or disdain by an employer and this becomes unbearable
to the employee. The law recognizes and resolves this situation in favor of employees in order to protect
their rights and interests from the coercive acts of the employer. Whereas vali d termination by the
employee under Art. 285 of the Labor Code contemplates such act to be voluntary, an employee who is
forced to relinquish the position held through the employers unfair or unreasonable acts is deemed to
have been illegally terminated or discharged, as such the termination is implied to be involuntary. [17]
In constructive dismissal cases, the employer has the burden of proving that its conduct and action or the
transfer of an employee are for valid and legitimate grounds such as genuine business
necessity. Particularly, for a transfer not to be considered a constructive dismissal, the employer mustbe
able to show that such transfer is not unreasonable, inconvenient, or prejudicial to the employee. Failure
of the employer to overcome this burden of proof, the employees transfer shall no doubt be tantamount
to constructive dismissal. [18]
In the instant case, Burger Machine failed to discharge this burden. The labor tribunals below correctly
found that the combination of the harsh actions of respondents rendered the employment condition of
petitioner hostile and unbearable for the following reasons: First, in the March 7, 2002 Memorandum of
De Jesus, no reason was stated why petitioner was directed to turn over BMNC to Centino. While the due
process required by law is applied to dismissal cases, the same is also applicable to the instant controversy
because it affects the status and right of petitioner to security of tenure. [19] Note that the same
74
Memorandum did not inform petitioner of his next assignment thereby placing him in a floating
status. Burger Machine belatedly claimed in its position paper that petitioner was relieved of his position
because of gross inefficiency. If this is the case, the action of respondents was thus punitive in nature. With
more reason therefore that the ground for the turn over should be stated in the Memorandum toapprise
him of the cause of such punitive action. This omission of the company is a trespass not only of petitioners
due process rights but also of the basic respect and professional courtesy due him as an employee.
Second, petitioner repeatedly claimed [20] that respondent De Jesus was insisting on his resignation, yet the
latter never denied said allegation in his November 26, 2002 affidavit.[21] This only lends credence to the
claim of petitioner that the constant pressure of De Jesus for him to quit his job rendered his employment
with Burger Machine unbearable.
Third, Burger Machine made an unauthorized[22] deduction on petitioners salary representing the alleged
expenses incurred without authority. The burden of proving that no such deduction was made lies with
Burger Machine not only because it has custody of the records that might establish the same, but also
because as an employer, it is placed in a position of a debtor who has the onus of establishing paymentof
the employees salary in full and without deduction. [23] Hence, its bare denials cannot overcome the
contention of petitioner that such deductions were made.
Fourth, petitioner was subsequently appointed as Profit Center Manager of the TFC but Burger
Machine recalled said appointment, again, without stating the reason therefor, and worse without serving
him any formal memorandum withdrawing the appointment.
Fifth, he was offered an assignment in the NCR, specifically as Profit Center Ma nager of the PD but not
actually appointed as such. Burger Machine averred that petitioner was ordered to report at the EDSA
office in connection with his PD assignment. However, no such directive was contained in the July 16, 2002
Memorandum of De Jesus, thus:
Effective today, 17 July 2002, and onwards, you are officially expected to report to the undersigned in
EDSA office at 9:00 a.m. up to 6:00 p.m. As has been the Company policy, you shall be required to log in
and log out in the required Managers records in order to get paid. All approval of leaves and official
business must be with the required days/time of approval by the undersigned, not to mention, the need
for supporting documents to justify the requests. Lastly, you shall be required to submit yourself to a
medical examination by the Company Physician to attest your fitness for work. [24]
The foregoing Memorandumis actuallya transfer of petitioner to the EDSA office of Burger Machine which
we find to be oppressive inasmuch as petitioner and his family are residents of Baguio City. The transfer
would mean that petitioner would be away from his family or that he would bring his entire family
to Manila entailing expenses.[25] While the Court recognizes the prerogative of an employer to transfer an
employee, [26] we cannot apply the same in the instant case considering that Burger Machine advanced no
justification or necessity for said transfer.
If the underlying reason for the posting of petitioner at the EDSA office of Burger Machine was his series
of request for leave of absences, then the proper recourse is to make him explain for said absences and to
impose the proper penalty if necessary. It appears, however, that all said requests for leave have valid
bases, otherwise, they would not have been approved by Burger Machine. This only shows that the
transfer of petitioner at the EDSA office was to pressure him and to ultimately ease him out of the
company.
 75

The test of constructive dismissal is whether a reasonable person in the employees position would have
felt compelled to give up his position under the circumstances. Based on the factual considerations in the
instant case, we hold that the hostile and unreasonable working conditions of petitione r justified the
finding of the Labor Arbiter and the NLRC that petitioner was constructively dismissed. Petitioners
performance may not have been exceptional as he ranked 14 th in the quality food service control survey
for the 1 st quarter of 2002.[27] But he was certainly not grossly inefficient as Burger Machine picturedhim
to be. In fact, he received several citations and was able to comply with the directive to reduce his
shortages for the month of November 2001. From all indications, there is really no ground to dismiss
petitioner for gross inefficiency. And, as Burger Machine saw it, the only way to get rid of the latter was to
constructively dismiss him.

The Labor Arbiter and the NLRCs findings that petitioner was constructively dismissed are binding on this
Court [28] especially so that the contrary conclusion of the Court of Appeals was based on the
misapprehension of the factual antecedents of this case. The appellate court focused only on the transfer
of petitioner to the PD in the NCR without taking into consideration the entire factual milieu of the
controversy. Had the Court of Appeals done so, it would have arrived at the same conclusion as the labor
tribunals below.

Anent the solidary liability for the constructive dismissal of petitioner, the same cannot attach with respect
to respondents Caesar B. Rodriguez and Fe Esperanza B. Rodriguez, Chairperson and President of Burger
Machine, respectively, considering that no substantial evidence was presented to prove their participation
in the acts of respondent De Jesus. It was only the latter who pressured petitioner to relinquish his position
and was the one responsible for the issuance of the oppressive Memorandum transferring petitioner to
the EDSA office. Liability must likewise be imputed to Burger Machine. The failure to exercise proper
diligence in the supervision of its employees, is ultimately its responsibility. [29]

Petitioner was properly awarded moral and exemplary damages. Moral damages may be recoveredonly
where the dismissal of the employee was tainted by bad faith or fraud, or where it constituted an act
oppressive to labor, and done in a manner contrary to morals, good customs, or public policy while
exemplary damages are recoverable only if the dismissal was done in a wanton, oppressive, or malevolent
manner. These damages, however, are not intended to enrich petitioner and should therefore be reduced
to P50,000.00 each. [30]

The award of 14 th month pay must be deleted. Since the payment thereof is not required by law,
substantial evidence showing that Burger Machine has the customary practice to give the same to its
employees, is necessary. This, petitioner failed to satisfy.

The award of attorneys fees is sustained based on Article 111 of the Labor Code, Section 8, Rule VIII,Book
III of its Implementing Rules, and paragraph 7, Article 2208 of the Civil Code. In actions for recovery of
wages or where an employee was forced to litigate and thus incurred expenses to protect his rights and
interests, a maximum of ten percent (10%) of the total monetary award by way of attorneys fees is
justifiable.

WHEREFORE, the December 20, 2005 Decision of the Court of Appeals in CA-G.R. SP No. 87910
is REVERSED and SET ASIDE. TheMay 27, 2003 Decision of the Labor Arbiter finding that petitioner was
constructively dismissed, is REINSTATED with the followingMODIFICATIONS: (a) Respondents Caesar B.
Rodriguez and Fe Esperanza B. Rodriguez are absolved from personal liability; (b) the award of 14 th month
pay is deleted; and (c) the awards of moral and exemplary damages are reduced to P50,000.00 each.

SO ORDERED.
 76

[G. R. No. 138258. January 18, 2002] On Appeal to the Regional Trial Court of Dumaguete City, docketed as Civil Case No. 12014, the challenged
verdict was reversed in a Decision dated October 21, 1997, the decretal portion reads:
EDDIE HERRERA, ERNESTO T. TIJING, and CONRADO BOLLOS, petitioners, vs. TEODORA BOLLOS and RICO
GO,respondents. WHEREFORE, as prayed for by plaintiffs-appellants, judgment is hereby rendered restoring Lot No. 20, GSS-
615 to the plaintiffs and ejecting the defendants from the said parcel of land. Defendants-appellees are
D E C I S I ON condemned to solidarily pay plaintiffs-appellants the following:
PARDO, J.: Actual Damages P50,000.00;
The Case Moral Damages P25,000.00

The case is a petition for review on certiorari of the decision of the Court
of Appeals [1] affirming that
of the Attorneys Fees - P 5,000.00
Regional Trial Court, Branch 44, DumagueteCity, which reversed the ruling of the municipal trial court that
it has jurisdiction over the case of forcible entry. Reasonable rental/month from the date of this judgment of P2,000.00 and to pay the costs.

The Facts SO ORDERED.

The facts, as found by the Court of Appeals, are as follows: GIVEN this 21 st day of October, 1997, in the City of Dumaguete, Philippines.

Ab initio, on August 5, 1993, Teodora Bollos commenced before the Municipal Circuit Trial Court of (SGD.) ALVIN L. TAN
Bayawan-Basay Civil Case No. 993, for forcible entry, solely against Eddie Herrera alleging that the latter,
sometime in the second week of 1993, through stealth and strategy and taking advantage of the absence Judge
of Teodora, entered and occupied her Sugarland known as Lot No. 20, GSS-615, located at Camandagan,
(p. 13, RTC Decision; p. 27, Rollo)[2]
Maninyon, Bayawan, Negros Oriental. Teodora claims to have inherited said parcel, being the only heir,
from her deceased father, Alfonso Bollos, who died on December 10, 1992. On March 12, 1998, petitioners filed with the Court of Appeals a petition for review assailing the ruling of
the regional trial court. [3]
Defendant, Eddie Herrera, denied the allegations against him maintaining that he entered and occupied
not Lot No. 20, as claimed by Teodora, but Lot No. 21, GSS-615, which is owned by Conrado Bollos, a On December 18, 1998, the Court of Appeals promulgated a decision, the dispositive portion of which
brother of Teodoras father, Alfonso. Further, Herrera said that his occupation of the property was not reads:
through stealth or strategy but by virtue of a contract of lease executed between Conrado Bollos, as lessor,
and Ernesto Tijing, as lessee. Herrera is Tijings overseer on the land. IN VIEW OF THE FOREGOING, the appealed decision is hereby affirmed, except that the award of actual
and moral damages therein contained are deleted. No pronouncement as to costs.
As a consequence, the complaint was twice amended, first, on March 23, 1994 to include Ernesto T. Tijing
as a party-defendant and much later on October 4, 1995, this time to implead Conrado Bollos as an SO ORDERED.[4]
additional defendant.
On February 1, 1999, petitioners filed with the Court of Appeals a motion for reconsideration of the above-
After due proceedings, the first level court rendered its judgment dispositively ruling: cited decision. [5]

ACCORDINGLY, in the light of the foregoing considerations for plaintiffs failure to make-out a forcible entry On March 8, 1999, the Court of Appeals denied the motion. [6]
case because of lack of jurisdiction the above-entitled case is hereby DISMISSED. Plaintiffs remedy should
be reivendicatory (sic) action before the proper forum. Hence, this appeal. [7]

SO ORDERED. The Issues

Given this 30 th day of June, 1997, at Bayawan, Negros Oriental, Philippines. The issues raised are:

(SGD.) RUDY T. ENRIQUEZ (a) Is the municipal trial court vested with jurisdiction over a second amended complaint impleading a new
defendant filed beyond one year from dispossession alleging a case of forcible entry in the original action?
Circuit Judge
(b) May the regional trial court award moral and exemplary damages against defendants in an appeal from
(p. 11, MCTC Decision; p. 69, Rollo) a dismissal of the case for forcible entry by the lower court? [8]

The Courts Ruling

 77

We deny the petition. IN VIEW WHEREOF, the Court DENIES the petition. However, the Court SETS ASIDE the decisions of the
Court of Appeals [18] and the Regional Trial Court. [19] The Court remands the case to the municipal trial court
Resolving the first issue, we emphasize the basic rule that jurisdiction of the court over the subject matter for further proceedings.
of the action is determined by the allegations of the complaint at the time of its filing, irrespective
of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein.[9]What No costs.
determines the jurisdiction of the court is the nature of the action pleaded as appearing from the
allegations in the complaint. The averments therein and the character of the relief sought are the ones to SO ORDERED.
be consulted.[10]

In the case at bar, plaintiffs complaint, both original and amended, contains sufficient allegations
constituting an action for forcible entry, as clearly alleged in paragraphs 4 and 5 of the complaint, to wit:

4. That plaintiffs and even their predecessor-in-interest Alfonso Bollos were in peaceful, adverse,
continuous possession of the property and in concepto de dueno until the commission of the actor acts of
dispossession or deprivation by the defendant hereinafter mentioned.

5. That sometime in the second week of June, 1993, defendant pursuant to an avaricious intent of
enriching himself at the expense of the plaintiffs, through stealth and strategy, and taking advantage of
the absence of the latter, entered and occupied the property in question and without any legal justification
therefore, fertilized the sugar cane rations growing thereon and planted the vacant portions with sugar
cane.[11]

Thus, we find that the complaint alleged prior physical possession de facto which the defendants disturbed
by force, intimidation, threat, strategy or stealth, against the will or without the consent of the plaintiffs,
sufficient to constitute a cause of action for forcible entry.

In fact, defendants admitted the truth of the foregoing facts in their answer and first amended answer.
The thrust of their defense was that they had occupied Lot No. 21, not Lot No. 20, which is the land in
question.

On the second issue, the concept of damages in an action for forcible entry and detainer cases is well
defined in several cases. [12] These damages mean rents or the reasonable compensation for the use and
occupationof the premises, or fair rental value of the property.[13] Temperate, actual, moral andexemplary
are neither rents nor reasonable compensation for the use and occupation of the premises, nor fair rental
value, and are not recoverable in such cases. [14]

In the case at bar, the municipal trial court dismissed the case for lack of jurisdiction, and the regional trial
court reversed the dismissal but rendered judgment ejecting the defendants from the parcel of land
involved, and condemning them to pay damages and attorneys fees. This is not correct. In case of reversal,
the case shall be remanded to the municipal trial court for further proceedings. [15] The regional trial court
in reversing an appealed case dismissing the action cannot decree the eviction of the defendants and
award damages. A court cannot take judicial notice of a factual matter in controversy. The court maytake
judicial notice of matters of public knowledge, or which are capable of unquestionable demonstration, or
ought to be known to judges because of their judicial functions. [16] Before taking such judicial notice,the
court must allow the parties to be heard thereon. [17] Hence, there can be no judicial notice on the rental
value of the premises in question without supporting evidence.

The Judgment
 78

[G.R. No. 134239. May 26, 2005]
REYNALDO VILLAFUERTE and PERLITA T. VILLAFUERTE, petitioners, vs. HON. COURT OF APPEALS,
EDILBERTO DE MESA and GONZALO DALEON, respondents.
D E C I S I ON
CHICO-NAZARIO, J.:
This is a petition for review on certiorari of the Decision [1] of the Court of Appeals in CA-G.R. CV No.41871
which affirmed, with modification, the decision [2] of the Regional Trial Court, Branch 55, Lucena City, in
Civil Case No. 90-11 entitled, Reynaldo C. Villafuerte and Perlita Tan Villafuerte v. Edilberto De Mesa and
Gonzalo Daleon.
The facts, as established by the Court of Appeals, follow:
Appelees the spouses Reynaldo C. Villafuerte and Perlita Tan-Villafuerte operated a gasoline stationknown
as Peewees Petron Powerhouse Service Station and General Merchandise on the premises of three (3)
adjoining lots at the corner of Gomez Street and Quezon Avenue in Lucena City. One of these lots, Lot No.
2948-A with an area of 575 square meters,is owned by several persons,one of whom is a ppellantEdilberto
de Mesa, while the other lot, Lot 2948-B with an area of 290 square meters, is owned by appellant Gonzalo
Daleon and his brother Federico A. Daleon. The remaining lot belongs to Mrs. Anicia Yap-Tan, mother of
appellee Perlita Tan-Villafuerte.
Appellants Edilberto de Mesa and Gonzalo Daleon acquired their respective lots subject to the lease by
Petrophil Corporation which had built thereon the gasoline station being managed by the Villafuerte
couple. When the lease of Petrophil Corporation expired on December 31, 1988, the Villafuertes obtained
a new lease on Lot No. 2948-A from appellant Edilberto de Mesa for a period expiring on December 31,
1989, thus:.
1 This lease will be for a period of one (1) year only, from January 1, 1989 and will terminate on the 31st of
December 1989 at a monthly rental of FOUR THOUSAND PESOS (P4,000.00). (Exhibit 1 -A-1 De Mesa).
It appears that in the early morning of February 1, 1990, appellants Edilberto de Mesa and Gonzalo Daleon,
with the aid of several persons and without the knowledge of the Villafuertes, caused the closure of the
latters gasoline station by constructing fences around it.
The following day February 2, 1990 the Villafuertes countered with a complaint for damages with
preliminary mandatory injunction against both Edilberto de Mesa and Gonzalo Daleon. Docketed in the
court below as Civil Case No. 90-11, the complaint seeks vindication for the alleged malicious and unlawful
fencing of the plaintiffs business premises (Records, pp. 1 -6).
Invoking their status as owners of the withheld premises, the defendants admitted in their respective
answers having caused the fencing of the plaintiffs gasoline station thereat but reasoned out that they did
so on account of the plaintiffs refusal to vacate the same despite demands.
After hearing the parties in connection with the plaintiffs application for a writ of preliminary mandatory
injunction, the lower court, in its order of May 23, 1990, ruled that with the expiration of the lease on the
defendants property, the plaintiffs have no more right to stay thereon and, therefore, cannot pretend to
have a clear and unmistakable right to an injunctive writ and accordingly denied their application therefore
(Rec., p. 186). In a subsequent order of July 30, 1990, the same court denied the Villafuertes motion for
reconsideration (Rec., p. 237).
Later, with leave of court, the Villafuertes amended their complaint to allege, among others, that the
complained acts of the defendants cost them the following items of actual damages:
a) Daily Sales (4000-5000 lts.) at .35lt.
mark-up, P1,750 x 270 days P472,500.00
b) Storage Fee of POL (Petroleum, Oil &
Lubricants) Recom 4 at 5% for 100,000 lts.
= 5000 lts. X 3 quarters x P6.00/lt. 90,000.00

As regards Lot 2948-B of the Daleon brothers, the Villafuertes were not as lucky. For, instead of obtaining c) Tires, Batteries, Accessories (TBA) Gen.
a lease renewal, what they received were demand letters from the brothers counsel ordering them to
Merchandise Sales, P50,000/mo. 20% mark-
vacate the premises. Instead of complying therewith, the Villafuertes simply ignored the demand and
continued operating the gas station (Exhibits 3-B, 3-C and 3-F, Daleon). Up = P10,000 x 9 months 90,000.00

On May 9, 1989, in the Office of the Barangay Captain of Barangay Tres, Lucena City, a complaint for d) Hauling of Petroleum products for Peewees
ejectmentwas filed by Gonzalo Daleonagainst the Villafuertes (Exhibit6, Daleon). Evidently,no settlement
was reached thereat, as shown by a certification to file action issued by the lupon. Petron Powerhouse, 2 trips weekly, P1,500

With their problem with the Daleon brothers far from over, the Villafuertes were apt for another one; their X 8 trips/mo. X 9 months 108,000.00
lease contract with Edilberto de Mesa was not renewed when it expired on December 31, 1989.
Nonetheless, and duplicating what they had done in the case of the property of the Daleon brothers, the e) Hauling of Petroleum products for military
spouses continued to operate their gasoline station and other businesses on the lot of de Mesa despite
7 trips/qtr., P1,500/trip x 21 (3 qtrs.) 31,500.00
the latters demand to vacate.
f) Balloon Business (Sunshine Balloons)
What transpired next lays at the core of the instant controversy.
P50,000.00 capital, P6,000/mo. Income
 79

TOTAL LOSS 200,000.00 C - Requiring the defendants to pay jointly and severally actual damages representing unrealized income
and profits as well as losses referred to in paragraphs 10 and 12 hereof in such amount as may be shown
g) Uncollected Debts 619,030.61 in evidence during the hearing.
h) Uncollected Checks 37,449.05 D - Granting the plaintiffs such other just and equitable remedies to which they may be entitled under the
law and equity. (Orig. Rec., pp. 292-293).
i) Merchandise Inventory as of July 25, 1990,
As later events disclosed, the defendants resumed possession of the premises in question on January 25,
P141,036.50 value, 50% damaged 70,518.25
1991 (Rec., p. 333). Four (4) days later, they obtained a judgment by compromise from the Municipal Trial
j) Damaged Office Equipments 30,000.00 Court in Cities, Lucena City in connection with the suit for ejectment they earlier filed thereat against
Petrophil Corporation. In that judgment, Petrophil bound itself to remove the materials and equipment
k) Stampitas (Religious Articles) and other related to the operation of the gasoline station on the subject premises. (Rec., pp. 355 -356).

Hermana Fausta Memorial Foundation, Inc. After the parties herein had presented their respective evidence, the lower court came out with the
decision now under review. Dated November 13, 1990, the decision dispositively reads:
printed matters entrusted in my care,
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and ordering the defendants Edliberto
totally damaged by rain and termites 5,000.00 de Mesa and Gonzalo Daleon to pay, jointly and severally, plaintiffs the following:

l) Products lost in 4 underground tanks 249,805.00 1. Actual damages in the total amountof TWO MILLION ONE HUNDRED SEVENTY SIX THOUSAND AND TWO
HUNDRED NINETY THREE PESOS AND FORTY FOUR CENTAVOS (P2,176,293.44);
m) Interest payments to RCBC (Rizal Commercial
2. Moral damages in the amount of P200,000.00;
Banking Corporation) for additional loan
3. Exemplary damages in the amount of P50,000.00;
availed of to pay off products acquired on
4. P50,000.00, as and for attorneys fees; and
credit from Petron Corp. but were held
5. Costs of suit.
inside gas station 172,490.53
SO ORDERED (Rec., pp. 408-414).[3]
TOTAL -- P2,176,293.44
The trial court ruled that with the continued occupation by petitioners of the two lots belonging to private
(Rec., pp. 290, 300)
respondents, despite the expiration of the lease contracts over the same, petitioners had become
The amended complaint thus prayed for the following reliefs: undesirable lessees. [4] However, it was improper for private respondents to resort to fencing their
properties in order to remove petitioners from the premises in the light of the clear provision of the Civil
WHEREFORE, it is respectfully prayed of this Hon. Court that judgment be rendered in favor of the plaintiffs: Code on the matter, to wit:

A - Immediately ordering the issuance of a writ of preliminary mandatory injunction against the defendants
commanding them and any person acting in their behalf to forthwith remove the fence they have
constructed around the premises in question, and after trial making the said injunction permanent.
B - Ordering the defendants to pay jointly and severally the plaintiffs the following:
1) Moral damages equivalent to not less than P200,000.00;
Art. 536. In no case may possession be acquired through force or intimidation as long as there is a
possessor who objects thereto. He who believes that he has an action or a right to deprive anotherof the
holding of a thing, must invoke the aid of the competent court, if the holder should refuse to deliverthe
thing.
Having disregarded the plain requirement of the law, private respondents were held accountable to
petitioners for the various damages prayed for by petitioners in their amended complain t.

2) Exemplary damages in the amount of P50,000.00; In due time, private respondents filed their respective appeals before the Court of Appeals which affirmed,
with modification, the decision of the trial court. The dispositive portion of the appellate courts decision
3) Attorneys fee in the amount of P60,000.00 plus twenty-five percent (25%) of the amount of damages to reads:
which plaintiffs are entitled; and

4) Litigation expenses in this instance in the amount of P10,000.00


WHEREFORE, the decision appealed from is MODIFIED by holding the appellants jointly and severally liable
to the appellees for P50,000.00 as exemplary damages and for P27,000.00 as actual damages, itemized as
follows:
1. detention of the records: P7,000.00;
2. detention of the merchandise: P10,000.00;
3. value of the damaged merchandise and religious items: P5,000; and
4. detention of offices equipment: P5,000.00,
and by holding the appellees jointly and severally liable for rental to appellants Edilberto de Mesa and
Gonzalo Daleon in the amount of P5,500.00 and P39,000.00, respectively.
The deficiency in the payment of the docket fees, to be computed by the clerk of court of the lower court,
shall constitute a lien on this judgment. [5]
In adjudging private respondents liable for damages, the Court of Appeals substantially ruled that:
1. Private respondents could not invoke the doctrine of self-help contained in Article 429 of the Civil
Code [6] reasoning that the doctrine finds no application when occupation was effected through lawful
means such as in this case where petitioners possession of the lots owned by private respondents was
effected through lease agreements;
2. Petitioners continued unauthorized occupation of private respondents properties may have been illegal,
however, it was incumbent upon private respondents to abide by the express provision of Article 536 of
the Civil Code requiring recourse to the proper court prior to ousting petitioners from their (private
respondents) lots;
3. On the matter of insufficient docket fees paid by petitioners during the institution of this action, the
Court of Appeals declared that whatever deficiency there may be in the docket fees can be levied from the
amount that may be awarded the appellees (petitioners herein) [7] and that private respondents were
already estopped from assailing the jurisdiction of the trial court;
4. Private respondents could not invoke the principle of damnum absque injuria as this doctrine only
applies when the loss or damage does not constitute a violation of a legal right or amounts to a legal
wrong[8] and not to this case where private respondents clearly violated the law by unilaterally displacing
petitioners from the subject premises;
5. On the issue of actual damages, the appellate court substantially reduced the amount of actual damages
awarded by the court a quo upon the ground that petitioners failed to substantiate their claims thereto
except for the detention of petitioners records of their receivables, various merchandise, damaged goods,
religious items, and office equipment;
6. As for the proprietyof awarding moral damages to petitioners,the Court of Appeals held thatpetitioners
are not entitled to this form of damage as this case does not fall within Article 2219 of the Civil Code;
7. Although Article 2219 of the Civil Code encompasses incidents which may fall within the purview of
Article 21 of the Civil Code, the latter, being a rule based on equity, necessitates the claimant to come to
court with clean hands which cannot be said of petitioners who continued to occupy the lands belonging
to private respondents without the authority of a subsisting lease agreement;
80
8. Private respondents are nevertheless liable for exemplary damages for having taken the law intotheir
own hands by fencing the premises of the Petron gasoline station operated by petitioners instead of
seeking redress from the proper court as mandated by Articl e 536 of the Civil Code; and
9. Petitioners are liable to pay private respondents for the unpaid rentals from the time the lease
agreements over the subject properties expired until 01 February 1990 when private respondents
constructed the fence.
Dissatisfied with the ruling of the Court of Appeals, petitioners are now before us raising, in the main, the
issue of whether the appellate court erred in substantially reducing the amount of damages earlier
awarded to them by the trial court.
Petitioners insist that the appellate court resorted to assumptions, inferences, surmises and conjectures
in disallowing certain items of actual damages like lost petroleum products valued at P249,805.00, loss of
value of merchandise detained for a quite a long time (sic) in the fenced premises and uncollected debts
as against the positive testimony of petitioner Perlita Villafuerte which remained unrebutted and
uncontested evenon appeal.[9] They alsoallege that the list of unrealized income,collectibles and damages
prepared by petitioner Perlita was based and ably supported by documents.
Petitioners also maintain that the Court of Appeals erred in finding that they came to court with unclean
hands, thus, depriving them of entitlement to moral damages. According to petitioners, their continued
occupation of private respondents properties was based on their belief that their lease contract with
private respondent De Mesa was modified and extended whereas private respondent Daleon had verbally
agreed to allow them to continue with their possession of his lot for as long as the Petron Corporations
equipment remain in the premises.
Finally, petitioners argue that the trial court was correct in awarding in their favor attorneys fees in the
amount of P50,000.00 as they were compelled to engage the services of counsel in order to seek
vindication from the arbitrary action of private respondents.
After a considered review of the records of this case, we resolve to affirm, with modification, the decision
of the Court of Appeals.
Both the trial court and the Court of Appeals concluded that the lease contracts between petitioners and
private respondents over the latters respective lots had already expired. There was also a congruence of
findings that it was wrong for private respondents to fence their properties thereby putting to a haltthe
operation of petitioners gasoline station. To this, we agree.
Article 536 of the Civil Code previouslyquoted explicitly provides for the proper recourse of one who claims
to be entitled to the possession of a thing. When private respondents personally took it upon themselves
to evict petitioners from their properties, which act was in clear contravention of the law, they became
liable for all the necessary and natural consequences of [their] illegal act. [10]
As expected, petitioners instituted this action praying that private respondents be held liable for actual
damages, moral damages, exemplary damages, attorneys fees, and costs of litigation. We shall resolve
their right to these damages in seriatim.
Actual or compensatory damages are those awarded in order to compensate a party for an injuryor loss
he suffered. They arise out of a sense of natural justice and are aimed at repairing the wrong
done.[11] Except as provided by law or by stipulation, a party is entitled to an adequate compensation only
for such pecuniary loss as he has duly proven. [12] It is hornbook doctrine that to be able to recover actual

damages, the claimant bears the onus of presenting before the court actual proof of the damages alleged
to have been suffered, thus:
A party is entitled to an adequate compensation for such pecuniary loss actually suffered by him as he has
duly proved. Such damages, to be recoverable, must not only be capable of proof, but must actually be
proved with a reasonable degree of certainty. We have emphasized that these damages cannot be
presumed and courts, in making an a ward must point out specific facts which could afford a basis for
measuring whatever compensatory or actual damages are borne. [13]
We have exhaustively perused the records of this case and thus conclude that petitioners have miserably
failed to proffer evidence capable of sustaining their plea for actual damages. We note that when
petitioner Perlita was directly examined with respect to her unrealized income [14] for the following
matters, namely: daily sales of various petroleum products; [15] storage fee of RECOM IVs petroleum, oil,
and lubricants;[16] sales of tires, batteries, accessories, and general merchandise; [17] hauling of petroleum
products for Peewees Petron Powerhouse by the gasoline tankers owned by petitioners; [18]hauling of
petroleum products for the military; [19] and petitioner Perlitas balloon business which she conducted
within the premises of the fenced gasoline station, [20] she repeatedly testified that she arrived at these
claimed amounts based on the average of her sales for the month of January 1990, the number of trips
undertaken by their tankers, and average volume of the gasoline deposit for RECOM IV. Her testimony on
these matters went as follows:
Atty. CAMALIGAN:
May I ask that this List of Unrealized Income, Collectibles and Damages from Febrauary 1, 1990 to October
30, 1990 be marked as Exhibit AA.
...
Q: Will you explain to the court why this list you made is up to October 30, 1990?
A: I prepared this list until October 10, 1990 in preparation for our firs t hearing sometime in November,
sir.
Q: I am calling your attention to No. 1 which is I quote, Daily Sales (4,000 to 5,000 liters) at P0.035 per liter
mark up P1,750.00 by 270 days amounting to P472,500.00 will you explain to the court how you incurred
this damage?
(A): After the closure of our gasoline station that was February 1, 1990 and then until September, 1990 is
nine (9) months and that is 270 days. I went thru my sales for January and the average sales (is) 4,000 to
5,000 liters and so for our daily sales of 4,000 to 5,000 liters sale at P0.35 centavos mark-up, I got P1,750.00
daily so that is times 270 days until September 1990, the total is P472,500.00, sir.
COURT: That is gross?
A: Yes, your Honor.
COURT: What about the net income to be realized?
A: Your Honor, we will deductfrom here the salaries andwages of the gasoline boys andelectric bill,maybe
P0.25 centavos per liter.
COURT: Proceed.
81
Q: Is the mark-up of P0.35 centavos per liter thru (sic), irrespective of amount of gasoline or value of
gasoline per liter?
A: We have different kinds of petroleum products, extra, regular and diesel and the average mark-up is
thirty-five (35) centavos.
...
Q: Calling your attention to No. 2 in the list which refers to storage fee of petroleum, oil and lubricant from
RECOM IV amounting to a total of ninety thousand pesos (P90,000.00) will you kindly explain how you
arrived at this amount?
A: The military, PC/INP RECOM IV which is stationed at Camp Nakar has entered into an agreement with
us to deposit their petroleum, oil and lubricant for every quarter, sir.
Q: Under what condition was that deposit made for?
A: That they will be able to withdraw the said products for a certain storage fee, sir, and the storage fee is
5% which would cover disposing the products and also certain percent of evaporation.
COURT: Five percent of what?
A: Five percent of the number of liters deposited with us so that if they deposited one hundred thousand
(100,000) liters we are paid in terms of gasoline also, five thousand (5,000 ) liters.
Q: What was the average volume of deposit made by the RECOM IV?
A: It is on a quarterly basis, that is one hundred thousand (100,000) liters quarterly, sir.
Q: On item 3 referring to tires, batteries, accessories, general merchandise is listed an amount of ninety
thousand (P90,000.00) pesos as your losses, will you please explain how you incurred such losses?
A: Aside from petroleum products we also sell accessories for the motoring public and they are in kinds
like tires, batteries and some additives, how do you realize income out of this? (sic)
A: We have 20% mark-up on the merchandise and last January 1990 I average fifty thousand (P50,000.00)
pesos gross income on the general merchandise so for 20% mark-up that is more or less ten thousand
(P10,000.00) pesos and for nine (9) months that is ninety thousand (P90,000.00) pesos, sir.
Q: In item No. 4 appearing in your list you listed a total amount of one hundred eight thousand
(P108,000.00) pesos, for hauling of petroleum products for Peewees Petron Powerhouse, will you explain
to the court this hauling?
A: My husband and I run a fleet of gasoline tankers and they are hauling petroleum products for our
gasoline stations and for the military accounts. We average two (2) deliveries every week so this is already
a net of one thousand five hundred (P1,500.00) pesos per delivery. It is two thousand eight hundred
(P2,800.00) pesos per delivery and deducting the salaries of the drivers, the fuel consumption and the
depreciation of the tankers, we incur a net of one thousand five hundred (P1,500.00) pesos per trip. Every
month we incur at least eight (8) trips and that is one thousand five hundred (P1,500.00) pesos times eight
(8) trips times nine (9) months and I got one hundred eight thousand (P108,000.00) pesos total.
Q: Do you own them?

A: Yes, sir.
Q: In item No. 6 you listed Balloon Business under Sunshine Balloon, you have given a total amountof two
hundred thousand (P200,000.00) pesos as your losses here, will you please explain to the Court how you
incurred these losses?
...
A: Inside the gasoline station we also operate a balloon business and we have invested fifty thousand
capital on this balloon business. This business has been thriving for several years and we usually incur six
(6) thousand monthly income from said business, sir. Now that the gasoline station was closed with all the
equipments of the balloon business inside also, we have totally lost the market for the balloon business
and I feel that two hundred thousand (P200,000.00) pesos would have to be paid for the total loss of the
business. [21]
Noticeably, petitioner Perlitas testimony was replete with claims that her unrealized income, as far as
these items were concerned, were based on the average. Except, however, for the record of daily
petroleum sales for the month of January 1990, [22] petitioners failed to present any evidence that would
sufficiently establish their mean income from these business undertakings. In the absence of any
corroborative proof, this Court is not bound to award in petitioners favor the actual damages for items a,
b, c, d, e, and f of her alleged unrealized income. Nor can we give premium on the summary of daily
petroleum sales for January 1990 prepared by petitioner Perlita as the same is not supported by any
competent evidence; at best, said exhibit is self-serving.
Anent the actual damages claimed for the deterioration of the items which remained inside petitioners
office, petitioner Perlita testified that when they were able to retrieve the merchandise from the gasoline
station, they noticed that most of them were already defective and so they valued [23] the damages thereto
at seventy (70%) of their total value. As for the items entrusted to her by the Hermana Fausta Memorial
Foundation of which she was the executive vice president at that time, petitioner Perlita alleged that the
amount of five thousand pesos represents the production cost of these materials which the foundation
purportedly paid to Imprenta Lucentina. As regards the amount of P30,000.00 sought as actual damages
for the damaged office equipment, petitioner Perlita stated before the trial court that she arrived at this
figure after computing the acquisition costs of these equipment which she approximated [24] to
be P35,000.00.
Evidently, in establishing the amount of actual damages for the merchandise inventory, office equipment,
and materials owned by the Hermana Fausta Memorial Foundation, petitioners relied solely on theirown
assessment of the prices of these items as well as the damage thereto purportedly occasioned by the
fencing of the gasoline station. This is clearly demonstrated by the inconsistent sta nce of petitioner Pertlita
with regard to the percentage of damaged merchandise stored in the gasoline station, thus:
ATTY. CAMALIGAN:
Q: I noticed that the total appearing on page 3 of your merchandize inventory is one hundred forty one
thousand thirty six pesos and fifty centavos (P141,036.50) only while in your list, it is ninety eight thousand
seven hundred twenty five pesos and fifty five centavos (P98,725.55), will you please explain the same?
WITNESS:
A: This list with the total amount of one hundred forty one thousand thirty six pesos and fifty centavos
(P141,036.50) represent the total value of all the merchandize but then the reason why we have the ninety
82
eight thousand seven hundred twenty five pesos and fifty five centavos (P98,725.55) figure is, this
represents seventy percent (70%) of the total amount because when we retrieved the merchandize, we
noticed that most of them are already defective, so we valued the damages only seventy percent (70%) of
the total value because some of them could still be sold, sir.
ATTY. CAMALIGAN:
Q: I noticed there is a correction in Item No. 9 from ninety percent (90%) to seventy percent (70%). When
did you make that correction?
A: Only last December 30, 1990 after we have retrieved all the merchandize. I prepared this list on October
31, 1990 not realizing the extent of the real damages to the merchandize but when we retrieved them last
December 29 and upon inspection, most of the motor oil have already leaked because of the plastics that
were exposed to sun and rain, so we changed the estimate to seventy percent (70%), sir. [25]
Such arbitrary estimations run afoul with our consistent pronouncement that actual or compensatory
damages cannot be presumed but must be proved with reasonable degree of certainty.[26] A courtcannot
simply rely on speculation, conjecture or guesswork as to the fact and amount of damages, but is required
to depend upon competent proof that the claimant had suffered and on evidence of the actual amount
thereof. [27] Failing in this regard, we resolve to delete the award of actual damages rendered by the Court
of Appeals with respect to these items.
Similarly, we rule that petitioners are not entitled to the total amount of the 17 checks issued in their favor
by their customers and to the amount of uncollected debts owed to them by their patrons. Petitioners
maintain that their customers were used to coming to their gasoline station in order to settle their
obligations but were prevented from doing after the 01 February 1990 incident. They therefore wouldlike
to hold private respondents accountable for these receivables. This, we can not grant.
The records indicate that petitioners filed before the trial court a motion to allow them to enter the
gasoline station subject of this dispute in order to make an inventory of their property that were locked
inside and to remove those they needed for their personal use. [28] Among the items removed from the
gasoline station were the receipts evidencing petitioners receivables from their customers [29] as well as the
17 uncollected checks.[30] Obviously, after the court-approved ocular inspection conducted on 24 July 1990
and 25 July 1990, petitioners were already in possession of the evidences of credit of their customers.
There was nothing, not even the closure of their gasoline station, which stood in the way of petitioners
exerting earnest efforts in going after their debtors.
Petitioners likewise seek to be compensated for the value of the petroleum products allegedly lost from
the four underground tanks between the period 01 February 1990 until 25 July 1990 when an ocular
inspection was conducted within the disputed property. According to petitioners, after they compared the
volume of the tanks contents as of the evening of 31 January 1990 with the dipstick reading on 25 July
1990, they discovered thatthey had lost thousands of liters of petroleumproducts.On this point, we quote
with approval the conclusion of the Court of Appeals, to wit:
The appellees [31] failed to adduce convincing evidence that appellants are the ones responsible forthe loss
of the petroleum products in the four (4) underground tanks (item 1, paragraph 10 of Amended
Complaint). Although the premises which were fencedby the appellants [32] adjoin the lot of Perlitas mother
and are even secured by appellees guard, the appellees did not present anyone to testify on the fact of
loss of said gasoline products. Instead, they chose to rely on Perlitas bare assertion that she
lostP249,805.00 in terms of petroleum products that allegedly disappeared. The sheer volume of the

missing fuel makes it difficult for the pilferer to commit the deed without attracting attention. An
unsubstantiated claim of loss, more so of such a dimension, cannot merit an award therefor. [33]
Finally, with respect to the interest payments to the Rizal Commercial Banking Corporation (RCBC),
petitioners maintain that because of the fencing of their gasoline station on 01 February 1990, they were
forced to obtain a loan from RCBC in order to pay off their obligations to different suppliers. This
contention was effectively refuted by petitioner Perlita herself when, during her re -direct examination,
she admitted that the loan granted by the RCBC was intended for all the businesses that she and her
husband, petitioner Reynaldo, were maintaining. [34] It would, therefore, be iniquitous to charge private
respondents for the interest payments for this loan the proceeds of which were utilized to finance
petitioners various businesses and not solely the settlement of petitioners obligations to the suppliers of
Peewees Petron Powerhouse. In the absence of actual proof as to how much of the RCBC loan was really
used to pay the creditors of the closed gasoline station, this Court can not affirm petitioners right to be
compensated for the amount of interest payments they have made to the RCBC.
We find, however, thatan award of temperate damages to petitioners is in order. In lieuof actual damages,
temperate damages, which are more than nominal but less than compensatory damages, may be awarded
where the court finds that some pecuniary loss had been suffered by the claimant but its amount cannot
be proved with certainty. Undoubtedly, pecuniary loss had been inflicted upon petitioners in this case,
however, due to the insufficiency of evidence before us, we cannot place its amount with certainty. In this
regard, we find the amount of P50,000.00 to be sufficient.
Petitioners also assail the removal by the Court of Appeals of the moral damages previously ordered by
the trial court. They argue that contrary to the findings of the appellate court, they came to court with
clean hands as they believed that the lease contract with private respondent De Mesa was modified and
extended. At the same time, they contend that they had a verbal understanding with private respondent
Daleon wherein the latter permitted them to remain in his lot for as long as Petron Corporation was not
removing its equipment. Further, petitioners contend that under Article 2219 of the Civil Code, this Court
had awarded moral damages in instances where the claimants were victims of capricious, wanton,
oppressive, malicious, and arbitrary acts such as petitioners in this case. On this issue, we agree in the
findings of the Court of Appeals that:
The Court must have to disallow the lower courts award of moral damages. The concept of moral damages,
as announced in Article 2217 of the Civil Code, is designed to compensate the complainant for his physical
suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock,
social humiliation and similar injury occasioned by the defendants wrongful act or omission. Article 2219
of the same Code specifies the cases where moral damages may be awarded, to wit:
Art. 2219. Moral damages may be recovered in the following and analogous case s:
(1) A criminal offense resulting in physical injuries;
(2) Quasi-delicts causing physical injuries;
(3) Seduction, abduction, rape, or other lascivious acts;
(4) Adultery or concubinage;
(5) Illegal or arbitrary detention or arrest;
(6) Illegal search;
83
(7) Libel, slander or any other form of defamation;
(8) Malicious prosecution;
(9) Acts mentioned in article 309;
(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.
The parents of the female seduced, abducted, raped or abused, referred to in No. 3 of this article, may
also recover moral damages.
The spouse, descendants, ascendants, and brothers and sisters may bring the action mentioned in No. 9
of this article, in the order named.
Noticeably, none of the foregoing instances has any relevant bearing to the case at bench. While Article
2219 comprehends the situation in Article 21 of the Code, whereunder [A]ny person who willfully causes
loss or injury to another in a manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damages, the appellees cannot benefit from it. The right to recovermoral
damages under Article 21 is based on equity, and those who come to court to demand equity mustcome
with clean hands (Garciano v. Court of Appeals, 212 SCRA 436 citing Padilla, CIVIL CODE ANNOTATED, Vol.
1, 1975 Ed., p. 87). The appellees knew that their lease had expired. Yet, despite such awareness, they
persisted in their unauthorized occupancy of appellants property. Being partly responsi ble for their
present predicament which is very much within their power to avoid, appellees cannot receive
compensation for whatever mental anguish or suffering they went thru. [35]
Similarly, we uphold the award of P50,000.00 as exemplary damages in order to deter similarly minded
individuals from pursuing the course of action taken by private respondents. The law on this matter is
clear: (h)e who believes himself entitled to deprive another of the possession of a thing, so long as the
possessor refuses delivery, must request the assistance of the proper authority. [36] Petitioners arbitrary
conduct of fencing their properties under the claim that they own the same brazenly violates the law and
circumvents the proper procedure which should be obtained before the court.
This Court likewise adopts the conclusion reached by the Court of Appeals that petitioners do not deserve
the award of attorneys fees for it was precisely their unfounded insistence to stay on private respondents
properties that precipitated this suit.
WHEREFORE, the Decision of the Court of Appeals da ted 31 March 1998, which modified the Decision
dated 13 November 1992 of the Regional Trial Court, Branch 55, Lucena City, and its Resolution of 17 June
1993 denying reconsideration are hereby MODIFIED as follows:
1. The award of Twenty-Seven Thousand Pesos (P27,000.00) as actual damages in favor of petitioners
Reynaldo and Perlita Villafuerte is deleted; and
2. Private respondents Edilberto De Mesa and Gonzalo Daleon are held jointly and severally liable to pay
petitioners the amount of Fifty Thousand Pesos (P50,000.00) as temperate damages.
The remainder of the same Decision and Resolution of the Court of Appeals are hereby AFFIRMED. No
costs.
SO ORDERED.

G.R. No. L-4155 March 20, 1908
RUPERTO BELZUNCE,Plaintiff-Appellee, vs. VALENTINA FERNANDEZ, ET AL.,Defendants-Appellants.
J.F. Martinez for appellants.
M. Locsin for appellee.
ARELLANO, C.J. :chanrobles virtual law library
By a complaint filed in the month of September, 1905, the plaintiff instituted ejectment proceedings
against the defendants to oust the latter from the hacienda named "Anonolip," and to recover from him
the sum of P1,723.22, the amount of rent due and unpaid.chanroblesvirtualawlibrary chanrobles virtual
law library
The said complaint was filedwiththe courtof the justice of the peace of Isabela, and judgment was entered
dismissing the ejectment proceedings, but sentencing the defendants to pay to the plaintiff the rents due
in the amount specified in the complaint. But parties appealed from this
judgment.chanroblesvirtualawlibrary chanrobles virtual law library
The court of the justice of the peace furthermore issued an order for the preliminary attachment of the
carabaos and agricultural products of the defendants.chanroblesvirtualawlibrary chanrobles virtual law
library
Upon the filing of a complaint with the Court of First Instance of Occidental Negros, similar to the former,
the plaintiff prayed for the recovery of the possession of the said hacienda called "Anonolip," and the
payment of the rents corresponding to 1904 and 1905, already due, and the rents which might accrue
during the year 1906, together with the legal interest and the costs.chanroblesvirtualawlibrary chanrobles
virtual law library
The defendants, by their answer, made a general denial of all the facts alleged and, b y way of special
defense, alleged that they had already paid the rent claimed, which constitutes the interest on a mortgage
debt, and that, on the contrary, there remained a balance to their credit. In addition thereto, the
defendants, by way of countercla im, made a further claim for damages amounting to P15,000 resulting,
on the one hand, from the preliminary attachment, and on the other, from noncompliance, on the partof
the plaintiff, with a contract under seal, dated July 15, 1905, according to the terms of which the latter
bound himself to furnish the defendants the money necessary to cultivate the hacienda
"Anonolip."chanrobles virtual law library
This hacienda had been sold by the defendants to the plaintiff on June 14, 1903, the right of repurchase
was reserved to the former, and by the terms of the agreement in the form of a contract of lease said land
was to be left in the possession of the vendors during the period allowed for the repurchase, conditioned
upon the payment of rent, which was made the subject of the complaint in this case, because the rent was
not paid during the years above mentioned.chanroblesvirtualawlibrary chanrobles virtual law library
After trial the Court of First Instance entered judgment as follows:
The court finds that the need of June 14, 1903, is a contract of sale with right of repurchase, andthat the
defendants, at the date of the filing of the complaint of ejectment in this case, had already paid the rents
corresponding to 1904 and 1905.chanroblesvirtualawlibrary chanrobles virtual law library
84
The judgment appealed from, in so far as it is not in conformity with this judgment, is reversed, andthe
defendants are absolved without special ruling as to costs; The right is reserved to Ruperto Belzunce to
bring the proper action to recover the rent for 1906 and the following years.
Both parties appealedfrom the above judgment, and both alsopetitionedfor a rehearing. Some time after,
however, the plaintiff withdrew his appeal and motion for rehearing, leaving only the appeal and motion
for rehearing filed by the defendants, which gave rise to the bill of exceptions which was duly certified and
filed with this court soon after exception was taken to the order denying the motion for
rehearing.chanroblesvirtualawlibrary chanrobles virtual law library
The assignment of errors made in support of the appeal is as follows:chanrobles virtual law library
1. The court erred "in finding that the deed of June 14, 1903, is not a mortgage, but a contract of sale with
right of repurchase."chanrobles virtual law library
2. The court erred "in finding that Valentina Fernandez is the only person who testified in regard to the
deed of June 14, 1903, and in not mentioning in its judgment the acts of the plaintiff which corroborate
the contention of the defendants."chanrobles virtual law library
3. The court erred "in finding that the defendants failed to explain why they did sign the deed of June 14,
1903, as executed."chanrobles virtual law library
4. The court erred "in not finding against the plaintiff for the payment to the defendants of the damages
resulting from the preliminary attachment, and in not reserving to them at least the right to bring an action
against the plaintiff, in this case, for damages caused by the illegal preliminary attachment."chanrobles
virtual law library
The subject-matter of the complaints, respectively, filed with both courts is the ejectment and the
payment of rents. The judgment appealed from does not sentence the defendants to be ejected from the
land or to pay the rent. The purpose of the defendants in assigning the first three errors is therefore
incomprehensible. Their allegation is evidently irrelevant and should not therefore occupy the attention
of this court.chanroblesvirtualawlibrary chanrobles virtual law library
The fourth error is the only one might serve as the basis for the bill exceptions. Nevertheless, the Courtof
First Instance did not err in not finding against the plaintiff for the payment of damages resulting from the
preliminary attachment issued by request of the latter, nor did the lower court commit error in not
reserving to the defendants the right to bring a separate action for said damages:chanrobles virtual law
library
First, because the nonreservation by judgment of the court of the right which one of the parties to an
action deems he may exercise in a separate action is neither an error nor an injury, because the lawdoes
not impose upon the judge the duty of making a reservation of this kind in cases when the exercise of the
right does not depend thereon.chanroblesvirtualawlibrary chanrobles virtual law library
Second, because the counterclaim for damages, filed for the first time on appeal before the Court of First
Instance, not having been filed nor being proper in the proceeding for ejectment in the court of the justice
of the peace, it was reasonably denied, on account of its notorious impropriety, as has been determined
in several decisions of the Supreme Court.chanroblesvirtualawlibrary chanrobles virtual law library
Third, because, according to section 439 of the Code of Civil Procedure, whose heading is "Disposition of
attached property in case of judgment against the plaintiff upon the obligation provided in section427 for
 85

any damages he may have sustained by reason of the attachment, after summary hearing in the same
action on due notice," if the attachment, according to section 427, "shall finally be adjudged to have been
wrongful or without sufficient cause."chanrobles virtual law library

For the foregoing reasons, we affirm the judgment appealed from, with the costs of this instance against
the appellants. So ordered.

[G.R. No. 147010. July 18, 2003]
PIONEER INSURANCE AND SURETY CORPORATION, petitioner, vs. DE DIOS TRANSPORTATION CO., INC.
and DE DIOS MARIKINA TRANSIT CORPORATION, respondents.
D E C I S I ON
CALLEJO, SR., J.:
This is a petition for review on certiorari of the October 31, 2000 Decision[1] of the Court of Appeals in CA-
G.R. SP No. 58519 [2] andits January 30, 2001 Resolution denying the petitioners motion for reconsideration
of the said decision.
The petition at bar arose from the following factual milieu:
Herein respondents De Dios Transportation Co. (DDTC) and De Dios Marikina Transport Corporation
(DMTC) were the franchise holders and owners of fifty-eight buses plying the Buendia-Ayala-UP and
Monumento-Ayala routes. On February 23, 1995, the respondents, as vendors, executed a Deed of
Conditional Sale covering the said buses and their franchise in favor of Willy Choa Coyukiat (Coyukiat)
and/or Goldfinger Transport Corporation (Goldfinger) as vendees. In the said contract, the respondents
bound and obliged themselves to sell to Coyukiat and Goldfinger the fifty-eight buses and their
corresponding franchise, and to deliver and turn over possession of the said buses to the vendees for the
price of P12,000,000, payable as follows:
(a) A downpayment of ONE MILLION (P1,000,000.00) PESOS in personal check shall be paid upon the
execution of this Contract;
(b) The balance of ELEVEN MILLION (P11,000,000.00) to be paid by eleven (11) postdated checks at the
rate of ONE MILLION (P1,000,000.00) a month all of which shall likewise be delivered to the VENDORS
upon the execution of this Contract; provided, however, that the date of the first postdated check shall be
thirty days from the full and actual delivery of the units as provided in paragraph 3 hereof and the
subsequent dates of the other postdated checks shall be reckoned from the date of the first postdated
check;[3]
The parties further agreed that in case of default by the vendors:
8. CONSEQUENCES OF DEFAULT. It is agreed and understood that the representations and warranties
made by the VENDORS in this Contract are the primary motivations/reasons that induced, convinced and
moved the VENDEE to enter into this contract and the Deed of Sale. In the event of default by the
VENDORS, the VENDEE shall at its option either consider the obligations of the VENDORS under the
Contract immediately due and demandable and the VENDORS shall immediately execute the Deedof Sale
of the buses and their corresponding lines/franchises without need of any further payments or reimburse
all the amounts paid by the VENDEE to the VENDORS. In either case, the VENDORS shall, likewise, be liable
to the VENDEE for liquidated damages in the amount of Twelve Million (P12,000,000.00) pesos.
In the event of default by the VENDEE, the VENDORS shall at their option, declare the entire obligation due
and demandable, and demand for the payment of the entire balance of the purchase price or declare the
contract as without any further force and effect and that all payments previously paid are forfeited. In
either case, the VENDEE shall, likewise, be liable for liquidated damages in the amount of Twelve Million
(P12,000,000.00) Pesos in favor of the VENDORS. [4]
86
The respondents, as vendors, guaranteed that the franchise and routes to Buendia -Ayala-UP andvice
versa and Monumento-Ayala via EDSA were valid, fully and completely utilizable, and merely required
registration with the Land Transportation Office (LTO) for the vendees to be able to operate the
same.[5] The vendees delivered the downpayment and postdated checks drawn upon the account of
Goldfinger with the Philbanking Corporation for the balance of the purchase price.
On March 23, 1995, the respondents delivered the buses to the vendees. The respondents were able to
encash the check for the downpayment of the purchase price. However, before the respondents could
deposit the first check for the remaining balance, the vendees stopped all payments, on their claimthat,
contrary to the representations of the respondents, some of the buses were not in good running
condition. The color of the buses had been changed without the proper permits or clearances from the
Land Transportation Franchising and Regulatory Board (LTFRB), the LTO and the Philippine National Police
(PNP). Consequently, the vendees failed to operate the buses. The vendees were, likewise, unable to
operate the buses along the Buendia -Ayala-UP route, notwithstanding the representation of the
respondents that only registration with the LTO was required.
On July 20, 1995, the vendees, through its counsel, the Padilla Reyes & De la Torre Law Office, filed a
complaint against the respondents and Philbanking Corporation as defendants with the Regional Trial
Court (RTC) of Quezon City for rescission of contract with a plea for a temporary restraining order or writ
of preliminary injunction. [6]
Therein plaintiffs Coyukiat and Goldfinger alleged that defendants (the respondents herein) reneged on
their obligation to deliver the buses in good running condition. By reason of the defendants
misrepresentation regarding the registration of the buses, they failed to secure certificates of registration
under their names, preventing them from operating the buses, thus causing tremendous losses to their
business which impelled them to stop the payments of the eleven remaining postdated checks. The
complaint contained the following prayer:
ON THE FIRST CAUSE OF ACTION
1. Declaring the Deed of Conditional Sale entered into between the plaintiffs Willy Choa Coyukiat and
Goldfinger Transport Corporation and the defendants De Dios Transportation Co., Inc. and the De Dios
Marikina Transit Corporation as RESCINDED.
2. Ordering the defendants De Dios Transportation Co. Inc and the De Dios Marikina Transit Corporation
to return the One Million Pesos (P1,000,000.00) down payment and all other amounts given by the
plaintiffs to them under the Deed of Conditional Sale.
3. Requiring the defendants De Dios Transportation Co. Inc. and the De Dios Marikina Transit Corporation
to accept the return from the plaintiffs of the fifty-eight (58) passenger buses;
4. Ordering the defendant De Dios Transportation Co. Inc. and the De Dios Marikina Transit Corporation
to pay jointly and severally to the plaintiffs the amount of Twelve Million Pesos (P12,000,000.00) as
liquidated damages.
ON THE SECOND CAUSE OF ACTION
5. On the second cause of action, ordering the defendant De Dios Transportation Co. Inc. and the De Dios
Marikina Transit Corporation to pay jointly and severally to the plaintiffs the amount of One MillionPesos
(P1,000,000.00) as moral damages.

ON THE THIRD CAUSE OF ACTION
6. On the third cause of action, ordering the defendants De Dios Transportation Co. Inc. and the De Dios
Marikina Transit Corporation to pay jointly and severally the amount of One Million Pesos (P1,000,000.00)
as exemplary damages.
ON THE FOURTH CAUSE OF ACTION
7. On the fourth cause of action, ordering the defendants De Dios Transportation Co. Inc. and the De Dios
Marikina Transit Corporation to pay jointly and severally to the plaintiffs the amounts of Five Hundred
Thousand Pesos (P500,000.00) as attorneys fees and at least One Hundred Thousand Pesos (P100,000.00)
as litigation expenses. [7]
The plaintiffs therein prayed for the issuance of a temporary restraining order, and after due notice and
hearing, to issue a writ of preliminary injunction, enjoining the therein defendants DDTC and DMTC,their
agents, representatives and all persons acting in their behalf from encashing, depositing, discounting or
transacting the postdated checks issued by plaintiff Goldfinger as listed in Annex B of the complaint, and
enjoining the defendant Philbanking Corporation (Del Monte branch), its agents, representatives and all
persons acting in its behalf from encashing, accepting, clearing, or transacting in any other manner, the
postdated checks listed in Annex A of the complaint.
On July 21, 1995, the RTC issued a temporary restraining order enjoining the defendants and theiragents
from encashing, accepting, clearing, or transacting twelve postdated checks issued by therein plaintiff
Coyukiat.[8] On August 11, 1995, the RTC granted the plaintiffs plea for a writ of preliminary injunction on
a bond of P11,000,000. The plaintiffs posted BondNo. 71336 issued by herein petitioner PioneerInsurance
& Surety Corporation for the amount of P11,000,000. [9]
On August 17, 1995, the plaintiffs filed an amended complaint dropping Philbanking Corporation as party-
defendant.
The defendants, in their answer with counterclaim, denied the material allegations of the complaint and
prayed for the dismissal thereof. The defendants interposed counterclaims for damages and attorneys
fees, thus: (a) P11,000,000 representing the plaintiffs unpaid balance; (b) P12,000,000 representing
liquidating damages; (c) P1,000,000 for moral damages; (d) P1,000,000 for exemplary damages; and (e)
twenty percent of the claim representing attorneys fees and P1,000 for each court appearance. [10]
On September 21, 1998, the trial court issued an order dismissing the case on motion of the defendants
for failure of the plaintiffs to prosecute the same. As directed by the trial court on motion of the
defendants, the latter adduced evidence ex parte to prove their counterclaim.
On December 14, 1998, the RTC rendered a decision dismissing the complaint and granting the
counterclaims of the defendants, the dispositive portion of which is herein quoted:
WHEREFORE, as prayed for, defendants counterclaim is hereby GRANTED, and judgment is hereby
rendered ordering plaintiff to pay the defendants the following:
(1) ELEVEN MILLION (P11,000,000.00) PESOS representing the plaintiffs unpaid balance on the
consideration of the Deed of Conditional Sale;
(2) TWELVE MILLION (P12,000,000.00) PESOS as liquidated damages;
87
(3) FIVE HUNDRED THOUSAND PESOS (P500,000.00) as moral damages and FIVE HUNDRED THOUSAND
PESOS (P500,000.00) as exemplary damages; and
(4) TWO HUNDRED THOUSAND PESOS as attorneys fees and P113,783.50 as litigation expenses;
(5) Costs of suit. [11]
Aggrieved, the plaintiffs Coyukiat and Goldfinger interposed an appeal to the Court of Appeals (CA) which
was docketed as CA-G.R. CV No. 61310.
On August 20, 1999, the appellants, through Atty. Ronaldo Reyes, filed their brief with the CA. Before the
appellees (the respondents herein) could file their brief, the Padilla Reyes & De la Torre Law Office filed on
September 14, 1999 its withdrawal of appearance as counsel for the appellants. On the same day, the Luis
Q.U. Uranza, Jr. & Associates filed its appearance as counsel for the appellants and filed a notice of
withdrawal of appeal. However, the withdrawal of appearance of the Padilla Reyes & De la Torre Law
Office, the appearance of the Luis Q.U. Uranza, Jr. & Associates and the notice of withdrawal of appeal
filed by Luis Q.U. Uranza, Jr. & Associates did not bear the conformity of the appellants. The appellees
(herein respondents) were served with copies thereof thru their counsel by registe red mail. [12]
On September 15, 1999, the respondents filed with the CA a Motion to Execute Against the Injunction
Bond posted by herein petitioner Pioneer Insurance and Surety Corporation, serving a copy thereof on
Atty. Ronaldo Reyes. [13]
The respondents alleged inter alia in their motion that the appellants Coyukiat and Goldfinger were not
entitled to a temporary restraining order or a writ of preliminary injunction. They contend that were it not
for the said temporary restraining order and writ of preliminary injunction, the appellants would nothave
been able to hide and dispose of their assets and sell the buses, thus frustrating the collection of the
amount of P11,000,000 representing the respondents counterclaim. [14] The CA issued a resolution
requiring the petitioner to file its comment on the motion.
On September 16, 1999, the CA issued a resolution granting the withdrawal of the Padilla Reyes & De la
Torre Law Office as counsel for the appellants and noting the entry of the Luis Q.U. Uranza, Jr. & Associates
as new counsel. However, with respect to the withdrawal of their appeal, the CA directed the appellants
to submit their written conformity thereto, and held in abeyance the resolution of the said incident
pending compliance by the appellants to its resolution. [15]
On September 28, 1999, the appellants submitted to the CA their conformity to the withdrawal of their
appeal. On October 8, 1999, the CA issued a resolution (a) declaring that the appeal of the appellants was
considered withdrawn and dismissed; and (b) directing the appellees to address their motion to execute
the bond with the trial court after the remand thereto of the records. On the same day, an entry of
judgment was issued by the CA. [16]
On November 4, 1999, the petitioner filed with the CA its comme nt on the opposition to the motion to
execute filed by the respondents with the CA on the following grounds:
I
There is no basis for defendants -appellees to execute against the injunction bond. [17]
II

The Decision of the lower court has become final and, therefore, defendants-appellees Motion can no
longer be entertained. [18]
III
Even assuming, for the sake of argument that an application for damages can still be made, defendants-
appellees suffered no damage by reason of the issuance of the injunction. [19]
In accordance with the directive of the Court of Appeals, the respondents filed on December 9, 1999 with
the RTC Quezon City, Br. 223,a Motionto Resolve their Motion to Execute Against the Injunction Bond. The
respondents alleged inter alia that (a) the trial court had ruled that the plaintiffs Coyukiat and Goldfinger
were not entitled to a writ of preliminary injunction; (b) were it not for the writ, the respondents would
have been able to negotiate and collect on the remaining postdated checks of the plaintiffs which had
become stale in the meantime; (c) the plaintiffs were able to hide and dispose of their assets because of a
temporary restraining order and writ of preliminary injunction issued by the court; (d) by reason of the
failure of the plaintiffs to pay the amount due and demandable under the decision of the court, the
respondents sustained damages; (e) in accordance with the provisions of the Revised Rules of Court,
before the decision of the court a quo became final and executory, the respondents filed their motion to
execute against the injunction bond on September 15, 1999 before the CA; (f) the CA directed the
respondents to address their motion to the trial court for consideration and resolution there of.[20]
On February 2, 2000, the court a quo issued an order denying the motion of the respondents on the
following grounds: (a) its Decision dated December 4, 1998 had already attained finality in view of the
withdrawal of the appeal by the plaintiffs; and (b) the resolution of the respondents motion to execute
against the injunction bond would necessitate the reception of evidence which could no longer be done
as its decision had become final and executory. The respondents motion for reconsideration of the order
was denied by the court on March 13, 2000. [21]
On April 21, 2000, the respondents, consequently, filed a petition for certiorari under Rule 65 of the 1997
Rules of Civil Procedure before the CA seeking the annulment of the February 2, 2000 and March 13, 2000
Orders of the court a quo. The respondents in this case alleged inter alia that the court a quoacted with
grave abuse of discretion amounting to lack or excess of jurisdiction when it denied their motion to resolve
(the motion to execute against the injunction bond) on the ground that the judgment in the main case had
become final and executory, and that the case could no longer be re -opened for the parties to adduce
evidence in support of the motion. [22]
On June 23, 2000, herein petitioner filed its comment. The petitioner averred that the decision of the trial
court had become final and executory on September 14,1999, upon the withdrawal of the appeal. Further,
when the CA issued its October 8, 1999 Resolution directing the respondents in this case to address their
motion to the trial court, it had already lost its jurisdiction over the appeal. Even assuming that the motion
of the respondents was timely filed, nevertheless, they did not suffer any damages arising from the
preliminary injunction issued by the trial court. The injunction bond answers only for the damages caused
to the adverse party by reason of the wrongful issuance of the injunction and not for the damages awarded
by the trial court on the respondents counterclaims.
On October 31, 2000, the CA rendered a decision annulling the assailed orders of the trial court and
granting the motion to execute on the injunction bond issued by the petitioner therein, thus:
88
WHEREFORE, the assailed Orders dated February 2, 2000 and March 13, 2000 are REVERSED and SET
ASIDE and, in lieu thereof, another is rendered granting the petitioners Motion to Execute Against the
Injunction Bond. No costs.[23]
The Court of Appeals cited the ruling of this Court in International Container Terminal Services, Inc. v. Court
of Appeals, [24] which declared that Section 20, Rule 57 of the Rules of Court regarding the application
against the surety bond in support of the writ of preliminary attachment shall apply by analogy to a
preliminary injunction. The CA likewise cited the ruling of this Court in Rivera v. Talavera, [25] andPonce
Enrile v. Capulong, [26] that the application or claim for damages against the injunction bond must be filed
before the trial court either during the trial with due notice to the surety or sureties, or even after trial
when judgment is rendered, but before entry the reof.
In its petition at bar, the petitioner contends that the decision and resolution of the CA should be reversed
and set aside based on the following grounds:
1. With all due respect, the Honorable Court of Appeals decided the case in a way not in accord with law
and the applicable decisions of the Honorable Supreme Court. The Honorable Court of Appeals erred when
it ruled that it still had jurisdiction over the case even after Coyukiat and Goldfinger had filed their Notice
of Withdrawal of Appeal as a matter of right.
2. Respondents are not entitled to execute on the injunction bond for failing to file an application for
damages against the injunction bond at the trial of the main case, Civil Case No. Q-95-24462, and for filing
the same only after the decision in said case had become final and executory.
3. The judgment of the Quezon City RTC-Branch 223 in the main case, Civil Case No. Q-95-24462, did not
include any award for damages in favor of respondents by reason of the issuance of the writ of preliminary
injunction, and the fact that the decision therein was in favor of respondents did not automatically entitle
them to such award for damages.
4. The damages allegedly sustained by respondents were not by reason of the issuance of the writ of
preliminary injunction. [27]
The petition is bereft of merit.
On the first ground, the petitioner argues that the withdrawal of the appeal on September 14, 1999
renderedthe decision of the trial court ipso facto final andexecutory. Since the appellants filedtheir notice
of withdrawal of appeal before the filing of the appellees brief, under Section 3, Rule 50 of the Rules of
Court, the appeal could be withdrawn without the need for the trial courts post factum approval. Further,
under Section 1(c) of Rule 15 of the 1996 Internal Rules of the CA, when an appeal is withdrawn, entry of
judgment shall be made immediately.
For their part, the respondents contend that the filing of the withdrawal of appeal through new counsel,
but without the appellants written conformity to the substitution and to such withdrawal of appeal, was
not self-executory. The appeal was deemed withdrawn and dismissed only upon the submission by the
appellants of their written conformity to the substitution of their new counsel and to the withdrawal of
their appeal, and the CAs approval of the same. It was only then that the appeal of the appellants was
deemed withdrawn and dismissed, and the decision of the trial court rendered final and executory. Thus:
The Court of Appeals still had jurisdiction over the case when the Motion to Execute Against the Injunction
Bond was filed.

Petitioner argues in its Petition that Coyukiat filed a Withdrawal of Appeal on September 14, 1999 or one
day before respondents filed their Motion to Execute Against Injunction Bond on September 15,
1999. Since no appellees brief had been filed at that time, petitioner argues that the withdrawal of the
appeal was a matter of right. Thus, Pioneer triumphantly concludes, on September 14, 1999 the appeal
was already effectively withdrawn and the Decision of the trial court had already become final and
executory.
What Pioneer conveniently does not disclose is that the Withdrawal of Appeal was not filed by counsel of
record for Coyukiat but a different counsel purporting to be the newly substituted counsel for
Coyukiat. This different counsel from the counsel of record had entered her appearance as such only for
the purpose of withdrawing the appeal.
More importantly, Pioneer also conveniently fails to disclose that neither the Entry of Appearance of new
counsel for Coyukiat nor the Withdrawal of the Appeal bore the conformity of Willy Choa Coyukiat and
Goldfinger Transport Corporationthe appellants.
It is well-established that substitution of counsel is not effective without the conformity of
client. Moreover, well-entrenched is the rule that pleadings which have the effect of withdrawing the
appeal should bear the conformity of the appellant.
Clearly therefore, the Withdrawal of Appeal filed on September 14, 1999 was not effectual because it did
not bear the conformity of Coyukiat. The new counsel of Coyukiat (who entered her appearance without
Coyukiats conformity in substitution of the counsel of record) cannot reasonably expect that she will be
allowed by the Court of Appeals to withdraw the appeal on her own. This is especially so when evenher
substitution of the counsel of record does not bear the conformity of the appellants.
In a long line of cases, the court has ruled that the attorney of record is regarded as the counsel who should
be held responsible for the conduct of the case (Fojas vs. Navarro, 32 SCRA 476, 485 [1970]).
For a substitution of attorneys to be effectual, the procedure to be followed strictly is as follows:
In order that there may be substitution of attorneys in a given case, there must be (1) a written application
for substitution; (2) the written consent of the client; (3) the written consent of the attorney substituted;
and (4) in case such written consent cannot be secured, there must be filed with the application proof of
service of notice of such motion upon the attorney to be substituted, in the manner prescribed by the
rules. Unless the foregoing formalities are complied with, substitution will not be permitted, and the
attorney who properly appeared last in the case, before such application for substitution, will be regarded
as the attorney of record and will be held responsible for the proper conduct of t he case. (Adarne vs.
Aldaba, A.C. No. 801, June 27, 1978; Cortez, et al. vs. CA, et al., L -32547, May 9, 1978; Ramos vs.
Potenciano, 118 Phil. 1435; and U.S. vs. Borromeo, 20 Phil. 189).
In this case, therefore, the Withdrawal of Appeal filed by a new counsel who substituted the counsel of
recordAtty. Ronaldo Reyes, without bearing the conformity of Coyukiat was a mere scrap of paper.
This is precisely the reason why the Court of Appeals issued a resolution requiring the appellant tosubmit
his conformity to the withdrawal.
As mentioned above, the appellants only manifested their desire to withdraw the appeal, by way of the
signature of Coyukiat in his behalf and in behalf of Goldfinger Transport Corporation, on September 29,
1999.
89
This conformity was taken note of by the Court of Appeals on October 8, 1999 when it dismissed the
appeal.
Clearly, therefore, even if we were to follow petitioners argument that a withdrawal of appeal is a matter
of right and needs no further action from the court, in this case the intention of withdrawing the appeal
was only properly made known to the court by Coyukiat and Goldfinger Transport Corp. on September 29,
1999.
By that time, respondents had already filed their Motion to Execute Against the Injunction Bond.
It is, therefore, not factually and legally accurate for petitioner Pioneer to claim that the Court of Appeals
had already lost jurisdiction over the case when the Motion to Execute Against the Injunction Bond was
filed.[28]
In its reply to the comment of the respondents, the petitioner avers that the compliance to the CA
Resolution of September 16, 1999, to submit the appellants conformity to the substitution of new counsel
and the withdrawal of the appeal was a ratification of the withdrawal of the appeal by the new counsel
which should be deemed effective as of the date of the filing of the notice of withdrawal of appeal, or on
September 14, 1999.
For its part, the CA ruled that it still retained jurisdiction over the appeal when the respondents filed their
motion for execution of the bond with the said court, the supervening finality of the RTC decision
notwithstanding:
The record shows that the withdrawal of their appeal by appellants Willy Choa Coyukiat and Goldfinger
Transport Corporation from the decision rendered in Civil Case No. Q-95-24462 was approved by the
Thirteenth Division of this Court only on October 8, 1999. Having preceded the resolution to the effect
issued in CA-G.R. CV No. 61310 (p. 92, Rollo) by twenty-three (23) days, there is no gainsaying the fact that
the petitioners filing of their application for damages against the injunction bond on September 15,1999
(pp. 72-75, ibid.) was still well within the time frame the law prescribes therefor. That this Court still had
jurisdiction over the case when the petitioners Motion for Execution Against the Injunction Bond was filed
is evident from the referral thereof to the court a quo in the same order which granted the appellants
withdrawal of their appeal (p. 92, ibid.). The supervening finality of the decision in Civil Case No. Q-95-
24462 notwithstanding, the respondent court clearly committed grave abuse of discretion in denying the
petitioners motion to resolve their application for damages solely on the ground that the withdrawal of
the appeal rendered its Decision dated December 4, 1998 final and executory (p. 28, ibid.).[29]
The contention of the petitioner does not persuade.
First. The notice of withdrawal of appeal filed by the Luis Q.U. Uranza, Jr. & Associates on September14,
1999 with the CA was a mere scrap of paper, absent a valid substitution of counsel. The counsel of record
as of September 14, 1999 was the Padilla Reyes & De la Torre Law Office. On the said date, the law office
filed a motion with the CA to withdraw as counsel for the appellants, while the Luis Q.U. Uranza, Jr. &
Associates filed the notice of withdrawal of appeal for the appellants. In the case of Santana-Cruz v. Court
of Appeals,[30] this Court enumerated the essential requisites of a valid substitution of counsel:
No substitution of counsel of record is allowed unless the following essential requisites of a valid
substitution of counsel concur: (1) there must be a written request for substitution; (2) it must be filed
with the written consent of the client; (3) it must be with the written consent of the attorney to be
substituted; and (4) in case the consent of the attorney to be substituted cannot be obt ained, there must
 90

be at least a proof of notice that the motion for substitution was served on him in the manner prescribed
by the Rules of Court. [31]
There was clearly no compliance to these essential requisites. It was only on September 16, 1999 when
the CA granted the motion of the Padilla Reyes & De la Torre Law Office to withdraw as counsel for the
appellants that the withdrawal of the said counsel and i ts substitution by the Luis Q.U. Uranza, Jr. &
Associates became effective.
Second. Section 3, Rule 50 of the Rules of Court, as amended, reads:
Section 3. Withdrawal of appeal. An appeal may be withdrawn as a matter of right at any time before the
filing of the appellees brief. Thereafter, the withdrawal may be allowed in the discretion of the court.
We agree with the respondents that the notice of withdrawal of appeal of the appellants in CA-G.R.CV No.
61310 filed on September 14, 1999 was not self-executory, and did not render the trial courts December
4, 1998 Decision final and executory. While we agree with the petitioner that under Section 3, Rule 50 of
the Rules of Court, an appeal may be withdrawn by the appellants as a matter of right at any time before
the filing of the appellees brief; however, the rule does not apply in this case because the notice of
withdrawal of appeal filed in CA-G.R. CV No. 61310 by the Luis Q.U. Uranza, Jr. & Associates did notbear
the appellants conformity thereto. It bears stressing that the counsel of the appellants was a mere agent
holding a special power of attorney to act for and in behalf of the principal respecting the ordinary course
of the appealed case. There was a need for the appellants, as the principals, to execute a special powerof
attorney specifically authorizing the withdrawal of a perfected appeal. [32] Absent a special power of
attorney expressly authorizing their counsel to withdraw their appeal, or in lieu thereof, the written
conformity of the appellants to the withdrawal of their appeal, the notice of withdrawal of appeal by the
new counsel of the appellants was a mere scrap of paper.
3. After hearing with notice to the surety. [34]
In International Container Terminal Services, Inc. v. Court of Appeals, [35] this Court ruled that due notice to
the adverse party and its surety setting forth the facts supporting the applicants right to damages and the
amount thereof under the bond is indispensable. The surety should be given an opportunity to be heard
as to the reality or reasonableness of the damages resulting from the wrongful issuance of the writ.[36] In
the absence of due notice to the surety,therefore,no judgment for damages may be entered and executed
against it.
In this case, the petitioner was not served with a copy of the motion to execute on the bond filedby the
respondents with the CA in CA-G.R. CV 61310.But the records show that the CA directed the petitioner to
file its comment on the said motion.[37] On November 4, 1999, the petitioner filed its comment on the
respondents motion, and on December 9, 1999, the respondents filed their motion to resolve with the trial
court, serving a copy thereof to the petitioner.It cannot, thus, be gainsaid that the petitioner was deprived
of its right to be heard on the respondents motion to execute on the bond.
We also agree that the Court of Appeals had the authority to remand to the court of origin the resolution
of the motion to execute against the injunction bond after the parties adduced their respective evidence
on the motion. To repeat, the respondents motion to execute was filed earlier than the motion to
withdraw the appeal, and more importantly, before the December 4, 1998 Decision of the court of origin
became final and executory. [38]
On the third and fourth grounds, the same should be addressed to and resolved by the trial court after
due hearing and presentation of evidence. As it was, the trial court denied the motion of the respondents
on its finding that it had no jurisdiction to take cognizance of the motion, without affording the parties the
right to adduce evidence thereon.

Third. The submission by the appellants on September 28, 1999 of the requisite conformity to the IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED DUE COURSE. The decision of the Court of
withdrawal of their appeal should not be given retroactive effect so as to foreclose the right of the Appeals is AFFIRMED. The RTC Quezon City, Branch 223, is directed to resolve on the merits the Motion to
respondents to file with the CA their motion to execute against the injunction bond, thus enabling the Execute Against Injunction Bond filed by the respondents after the parties shall have adduced their
petitioner to escape liability on the same. As ratiocinated by the CA: respective evidence in Civil Case No. Q-95-24462 with dispatch.

Having successfully enjoined the encashment of the checks they issued through the surety bondissued by SO ORDERED.
the private respondent (pp. 55-58, ibid.), Willy Choa Coyukiat and Goldfinger Transport Corporationwere
able to use and dispose of the petitioners buses (p. 134, ibid.) and to evade the satisfaction of the decision
rendered in Civil Case No. Q-95-24462 pending appeal (pp. 76-77, ibid.). Far from acknowledging the
judgment debt, therefore, it appears that the withdrawal of the appeal was merely calculated to further
frustrate the satisfaction of the same. [33]

The notice of withdrawal of appeal was deemed filed only on September 28, 1999 upon compliance with
the September 16, 1999 Resolution of the CA.The appeal of the appellants was effectively withdrawn and
dismissed before October 8, 1999 when the CA issued its resolution therein. The petitioner should notbe
benefited by the deleterious manipulation of the rules of procedure.

On the second ground, the petitioner avers that the respondents failed to serve a copy of their
(respondents) motion to execute on the bond as mandated by Section 20, Rule 51 of the Rules of Court,
as amended, which reads:

1. The application for damages must be filed in the same case where the bond was issued;

2. Such application for damages must be filed before the entry of judgment; and

CALIFORNIA BUS LINES INC. vs STATE INVESTMENT HOUSE, INC. G.R. No. 147950. December 11, 2003
QUISUMBING, J:
Facts:
Delta Motors Corporation applied for financial assistance from respondent State Investment House, Inc.,
a domestic corporation engaged in the business of quasi-banking. SIHI agreed to extend a credit line to
Delta which eventually became indebted to SIHI. Meanwhile, petitioner purchased on installment basis
several buses to Delta. To secure the payment of the obligation petitioner executed promissory notes in
favor of Delta. When petitioner defaulted on the payments of the debts, it entered into an agreement with
delta to cover its due obligations. However, petitioner still had trouble meeting its obligations withdelta.
Pursuant to the memorandum of agreement delta executed a deed of sale assigning to respondent, the
promissory notes from petitioner. Respondent subsequently sent a demand letter to petitioner requiring
remitting payments due on the promissory notes. Petitioner replied informing respondent of the factthat
delta had taken over its management and operations.
Issue:
Whether the Restructuring Agreement dated October 7, 1981, between petitioner CBLI and Delta Motors,
Corp. novated the five promissory notes Delta Motors, Corp. assigned to respondent SIHI,
Held:
The attendant facts do not make out a case of novation. The restructuring agreement between Delta and
CBLI executed on October 7, 1981, shows that the parties did not expressly stipulate that the restructuring
agreement novated the promissory notes. Absent an unequivocal declaration of extinguishment of the
pre-existing obligation, onlya showing of complete incompatibilitybetween the oldand the newobligation
would sustain a finding of novation by implication. 59 However, our review of its terms yields no
incompatibility between the promissory notes and the restructuring agreement.
CARLOS VS SANDOVAL
Teofilo Carlos and petitioner Juan De Dios Carlos were brothers who each have three parcels of land by
virtue of inheritance. Later Teofilo died intestate. He was survived by respondents Felicidad Sandoval and
their son, Teofilo Carlos II. Upon Teofilo’s death, two parcels of land were registered in the name of
Felicidad and Teofilo II. In August 1995, Carlos commenced an action against respondents before the
court a quo. In his complaint, Carlos asserted that the marriage between his late brother and Felicidad was
a nullity in view of the absence of the required marriage license. He likewise maintained that his deceased
brother was neither the natural nor the adoptive father of Teofilo Carlos II. He argued that the properties
covered by such certificates of title, including the sums received by respondents as proceeds, should be
reconveyed to him.
HELD: The grounds for declaration of absolute nullity of marriage must be proved. Neither judgment on
the pleadings nor summary judgment is allowed. So is confession of judgment disallowed. Carlos argues
that the CA should have applied Rule 35 of the Rules of Court governing summary judgment, instead of
the rule on judgment on the pleadings. Petitioner is misguided. Whether it is based on judgmenton the
pleadings or summary judgment, the CA was correct in reversing the summary judgment rendered by the
trial court. Both the rules on judgment on the pleadings and summary judgments have no place in cases
of declaration of absolute nullity of marriage and even in annulment of marriage.
91
A petition for declaration of absolute nullity of void marriage may be filed solely by the husband or wife.
Exceptions: (1) Nullity of marriage cases commenced before the effectivity of A.M. No. 02-11-10-SC; and
(2) Marriages celebrated during the effectivity of the Civil Code. Under the Rule on Declaration of
Absolute Nullity of Void Marriages and Annulment of Voidable Marriages, the petition for declarationof
absolute nullity of marriage may not be filed by any party outside of the marriage. A petition for
declaration of absolute nullity of void marriage may be filed solely by the husband or t he wife. Only an
aggrieved or injured spouse may file a petition for annulment of voidable marriages or declaration of
absolute nullity of void marriages. Such petition cannot be filed by compulsory or intestate heirs of the
spouses or by the State. The Committee is of the belief that they do not have a legal right to file the
petition. Compulsory or intestate heirs have only inchoate rights prior to the death of their predecessor,
and, hence, can only question the validity of the marriage of the spouses upon the death of a spouse in a
proceeding for the settlement of the estate of the deceased spouse filed in the regular courts. On the other
hand, the concern of the State is to preserve marriage and not to seek its dissolution. The Rule extends
only to marriages entered into during the effectivity of the Family Code which took effect on August 3,
1988.
The advent of the Rule on Declaration of Absolute Nullity of Void Marriages marks the beginning of the
end of the right of the heirs of the deceased spouse to bring a nullity of marriage case against the surviving
spouse. But the Rule never intended to deprive the compulsory or intestate heirs of their successional
rights.
While A.M. No. 02-11-10-SC declares that a petition for declaration of absolute nullity of marriage maybe
filed solely by the husband or the wife, it does not mean that the compulsory or intestate heirs are without
any recourse under the law. They can still protect their successional right, for, as stated in the Rationale of
the Rules on Annulment of Voidable Marriages and Declaration of Absolute Nullity of Void Marriages,
compulsory or intestate heirs can still question the validity of the marriage of the spouses, not in a
proceeding for declaration of nullity but upon the death of a spouse in a proceeding for the settlementof
the estate of the deceased spouse filed in the regular courts.
It is emphasized, however, that the Rule does not apply to cases already commenced before March 15,
2003 although the marriage involved is within the coverage of the Family Code. This is so, as the new Rule
which became effective on March 15, 2003 is prospective in its application.
Petitioner commenced the nullity of marriage case against respondent Felicidad in 1995. The marriage in
controversy was celebrated on May 14, 1962. Which law would govern depends upon when the marriage
took place.
The marriage having been solemnized prior to the effectivity of the Family Code, the applicable law is the
Civil Code which was the law in effect at the time of its celebration. But the Civil Code is silent as to who
may bring an action to declare the marriage void. Does this mean that any person can bring an actionfor
the declaration of nullity of marriage?
True, under the New Civil Code which is the law in force at the time the respondents were married, or
even in the Family Code, there is no specific provision as to who can file a petition to declare the nullityof
marriage; however, only a party who can demonstrate “proper interest” can file the same. A petition to
declare the nullity of marriage, like any other actions, must be prosecuted or defended in the name of the
real party-in-interest and must be based on a cause of action. Thus, in Niñal v. Badayog, the Court held
that the childrenhave the personality to file the petitionto declare the nullity of marriage of their deceased
father to their stepmother as it affects their successional rights .
 92

FLORES VS STRONGHOLD INSURANCE On October 13, 1995, the spouses Flores filed a Motion to Lift Preliminary Injunction and
Attachment.[9] They manifested their willingness to post a bond to lift the preliminary injunction and a
D E C I S I ON counterbond to lift the preliminary attachment.
CALLEJO, SR., J.: On May 22, 1996, the RTC issued an Order[10] granting the motion of the spouses Flores to lift the writ of
attachment upon the filing and approval of a counterbond in the amount of P6,000,000.00; however, the
This is a petition for review on certiorari of the Decision [1] of the Court of Appeals (CA) in CA-G.R. CV No.
RTC denied
77593 and its Resolution denying the motion for reconsideration thereof. The assailed decision nullified
the prayer to lift the writ of preliminary injunction. Upon motion of the spouses Flores, the RTC
the Order[2] of the Regional Trial Court (RTC) of Makati City, Branch 63, directing respondent Stronghold
reconsidered its order and reduced the amount of the counterbond to P3,000,000.00. It rendered
Insurance Corporation (SICI) to pay petitioner-spouses Napoleon and Veronidia Flores actual and moral
judgment on June 25, 1999 [11] in favor of the spouses Flores, declaring the MOA rescinded and ordering
damages, attorneys fees and costs of suit.
Liu to pay actual damages and attorneys fees. The fallo of the decision reads:
Spouses Napoleon M. Flores, Sr. and Veronidia J. Flores were engaged in business under the business
WHEREFORE, judgment is hereby rendered in favor of defendants, declaring the Memorandum of
name Flojos Garments Manufacturing (FGM). On April 28, 1995, Stephen Liu and the spouses Flores
Agreement rescinded, ordering both plaintiff and defendants to surrender that which they have
executed a Memorandum of Agreement (MOA), [3] whereby the latter sold forP8,500,000.00 all their
respectively received and to place each other as far as practicable in his original situation, and ordering
rights and interests over their garments manufacturing business, including all its existing l icenses and
plaintiff to pay the following:
government permits, machinery, supplies and spare parts, and its real property located at No. 17,
Jacamar St., Marikina Subdivision, Marikina City; and all other accessories, raw materials, and other 1. The amount of P6,582,133.08 as payment to all of defendants creditors;
related items. For his part, Liu obliged himself to assume the payment of the spouses obligations with
Metropolitan Bank and Trust Company as part of the purchase price, the balance of the purchase price to 2. The amount of P2,500,000.00 as compensation for the materials and machines lost; [and]
be paid within 120 days from the date of the signing of the MOA.
3. The amount of [P225,150.00] as attorneys fees and expenses.
On September 7, 1995, Liu filed a complaint [4] against the spouses Flores and Alexander J. Flores (in his
capacity as attorney-in-fact of Napoleon Flores, Sr.) for specific performance and damages with a prayer SO ORDERED.[12]
for issuance of temporary restraining order and/or writ of preliminary injunction and a writ of
The trial court upheld the spouses Flores claim that it was Liu who committed a breach of the MOA on
preliminary attachment. He alleged that the spouses Flores failed and refused to execute the necessary
the following ratiocinations:
deeds of conveyance, transfer or assignment of all the items included in the MOA, causing damages to
him; as a consequence of their acts of harassment and obstruction, he was entitled to the issuance of a Unrebutted testimony for the defendants belied the allegation of plaintiff. It was stated that all records
temporary restraining order or writ of preliminary injunction. He averred that, unless a writ of of the business including the licenses were turned over to plaintiff, together with the factory premises;
preliminary attachment was issued, there might not be sufficient security for the satisfaction of any the same being kept therein. It was, likewise, stated that the licenses, as of the date of the turnover, had
judgment which the court might render against them. all been effective and valid. A certification was obtained from the Bureau of Customs that no order of
revocation was ever issued against defendants business, to corroborate the testimony. The accreditation
On October 3, 1995, the RTC issued an Order[5] granting Lius prayer for writ of preliminary injunction and
from the Garments and Textile Export Board was still valid at the time of the agreements execution and
attachment upon the filing and approval of an injunction bond in the amount of P2,000,000.00 and
was even used to export a load of garments.
attachment bond in the amount of P3,000,000.00. The plaintiff thus posted Attachment Bond No. 00565
and Injunction Bond No. 00566 issued by Stronghold Insurance Corporation, Inc. for P3,000,000.00 On the other hand, it appears that it was plaintiff who failed to perform his obligations. Despite full
andP2,000,000.00, respectively. compliance on the part of defendants, plaintiff failed to pay the P8,000,000.00 balance of the purchase
price less any deductions from payments to defendants creditors. Indeed, plaintiff contends that no
In their Answer to the complaint,[6] the spouses Flores alleged that the complaint failed to state a cause
balance remains to be paid defendants their debts to creditors having been found by him to actually be
of action as there was no allegation that he complied with his obligations under the MOA; it was Liu who
in the amount of P14,631,082.00; P6,631,082.00 more than the purchase price. In other words, plaintiff
failed to pay the balance of the purchase price of the property, less the amounts due to their creditors;
wants the court to believe that as there is more than P8,000,000.00 in debts to pay, no further amount is
such failure caused them (spouses Flores) actual damages in the form of accumulated interests and
due defendants outside of the downpayment. However, the court observes that none of the debts had
penalties on their outstanding loans, loss of expected profits on prospective and realizable business
been paid; not even any such which may be covered by theP8,000,000.00. Plaintiff has not alleged
ventures and opportunities. They prayed that they likewise be awarded moral damages for the mental
payment of any creditors; neither those covered by paragraph 5 of the agreement and Annex B thereof,
anguish; besmirched reputation, moral shock, sleepless nights and other similar injuries, exemplary
nor those included in plaintiffs own inventory of accounts payable.
damages in order to serve as an example for the plaintiff and other persons in maliciously and
capriciously filing baseless and unjust suit; and attorneys fees as they were constrained to hi re the And although plaintiff alleged failure of payment due to the unsatisfied requirement of special power of
services of counsel. [7] They interposed counterclaims and averred that the ground relied upon for the attorney, no proof of such requirement was presented.
issuance of preliminary attachment did not exist at the time of the filing of the present suit. [8]

The foregoing considered, it is clear that plaintiff and not defendants breached the Memorandum of
Agreement. Ergo, defendants and not plaintiff are entitled to rescission. For the same reasons and more,
no amount for damages nor attorneys fees are due plaintiff. Defendants have faithfully performed their
obligations and in good faith. Any unrealized income or damage to reputation asserted by plaintiff
remain mere allegations and was caused by no act of defendants but his own.
It is defendants who are entitled to damages and attorneys fees. Materials and machinery of the
business have been found missing and unaccounted for since turnover of possession and custody to
plaintiff. The redemption period for the property and improvements mortgaged, an essential and
intrinsic component of said business, lapsed and were consequently foreclosed upon. Debts which
should have been paid in accordance with paragraph 5 of the agreement remain outstanding.
Defendants were constrained to engage the services of an attorney in order to protect their rights and
interest, and to pay the same P225,150.00. (Exhs. 1, 2, and 9 to 12). [13]
On July 1, 1999, the spouses Flores received a copy of the June 25, 1999 decision. The parties did not
appeal the decision.
On July 16, 1999, the spouses Flores filed their application for damages against the bonds posted by the
SICI, captioned A Motion to Set Hearing on the Damages Caused by the Injunction and
Attachment.[14] They alleged that, by posting the injunction/attachment bonds, Liu and SICI bound
themselves to be jointly and severally liable for such damages sustained by them by reason of the
injunction/attachment if the RTC should finally decide that it was not entitled to such remedy. [15] The
spouses Flores served a copy of their pleading on Liu and SICI by registered mail on July 16, 1999.
In its Comment and/or Opposition [16] to the said motion, SICI averred that the motion was premature,
and that the alleged damages suffered by the spouses Flores were not caused by the injunction or
attachment for which the bonds posted by it could be proceeded against, thus:
a) With all due respect, said motion has no factual and legal basis as all allegations therein contained did
not set forth the facts showing their right to damages, the nature of damages and the amount, if any,
corresponding to such damages directly or indirectly caused by either injunction or the attachment;
b) The motion is prematurely filed as there is no showing that either the injunction or the attachment
was illegally and improperly issued;
c) There is no evidence whatsoever on record to show that either the injunction or the attachment was
illegal or improper;
d) The damages, if any, incurred by defendants are not by reason of either the injunction or the
attachment for which the bonds put up by Stronghold can be held liable;
e) In fact, the issue of the injunction or the attachment was not even touched in the Decision rendered
by this Honorable Court dated June 25, 1999.There was not even any inference to either injunction or
the attachment. That is because defendants never challenged the injunction or the attachment for
having been issued illegally or improperly. It is only now that it is raised, for the first time, when it is
already too late-in-a-day after the decision was rendered;
93
f) What is significant to note is the finding of the Honorable Court that because of the breach of the
Memorandum of Agreement by plaintiff no amount of damages nor attorneys fees are due
plaintiff. The decision did not say that because of the bonds, the defendants are entitled to damages;
g) The motion did not comply with Section 20, Rule 57 of the Rules of Court because it did not specify the
amount for each item of damages. More importantly, defendants have not shown in the motion the facts
showing their rights to damages;
h) Both injunction and attachment bonds were issued by Stronghold upon application by plaintiff and
pursuant to the legal orders of this Honorable Court and which orders were never questioned by
defendants. [17]
Alexander Flores was presented as witness to prove the damages which the spouses Flores claimed to
have suffered on account of the improper issuance of the writ of attachment/injunction. The spouses
Flores did not testify. For its part, SICI opted not to present any evidence to support its opposition to the
motion, on its claim that there was no factual
proof of damages. Besides, the spouses Flores application for damages was time-barred because it was
filed three days after the reglementary period to appeal (July 1, 1999); hence, the period to appeal had
lapsed.
On January 21, 2002, the RTC issued an Order [18] directing SICI to pay the spouses Flores actual and moral
damages, attorneys fees, and costs of suit. The pertinent portion reads:
WHEREFORE, Stronghold Insurance Corporation is directed to pay the defendants the following:
1.) The amount of P2.5 million as actual damages for the materials and machines lost;
2.) The amount of P2.0 million as moral damages;
3.) The amount of P225,150.00 as attorneys fees; and
4.) The costs of the suit.
SO ORDERED.[19]
SICI filed a motion for reconsideration, which the RTC denied in an Order[20] dated July 30, 2002.
SICI appealed the Order of the RTC to the CA, alleging that:
I
THE LOWER COURT PALPABLY COMMITTED GRAVE ERROR IN ORDERING APPELLANT TO PAY THE
DEFENDANTS THE AMOUNT OFP2.5 MILLION AS ACTUAL DAMAGES FOR MATERIALS AND MACHINES
LOST; THE AMOUNT OF P2.0 MILLION AS MORAL DAMAGES; AND THE AMOUNT OF P225,150.00 AS
ATTORNEYS FEES.
II
THE LOWER COURT PALPABLY COMMITTED GRAVE ERROR WHEN IT ISSUED THE QUESTIONED ORDERS
DESPITE JUDGMENT HAVING BECOME FINAL AND EXECUTORY. [21]
 94

On November 10, 2004, the CA rendered a Decision [22] nullifying the Order of the RTC, holding that the
spouses Flores motion for damages against the bonds were filed on July 16, 1999; the decision of the
trial court had already become final and executory as to them since they did not appeal the
decision. Thus, the CA declared, the RTC no longer had jurisdiction to hear the motion nor amend i ts own
decision which had become final and executory.
The spouses Flores filed a motion for reconsideration which the CA denied in a
Resolution[23] dated February 17, 2005.
The spouses Flores, now petitioners, seek relief from this Court via petition for review on certiorari,
contending that:
THE COURT OF APPEALS DECIDED A QUESTION OF LAW NOT IN ACCORD WITH THE LAW OR APPLICABLE
DECISIONS OF THE HONORABLE COURT IN HOLDING THAT THE RTC HAD LOST JURISDICTION TO HEAR
AND ACT UPON THE MOTION FOR DAMAGES FILED BY THE PETITIONERS. [24]
The sole issue in this case is whether the petition for application of damages against the bonds posted by
respondent SICI was already time-barred when petitioners filed the same on July 16, 1999.
The petition is meritorious.
Section 20 of Rule 57 of the 1997 Rules of Civil Procedure reads:
applicable Statute, the day of the act or event from which the designated period of time begins is to be
excluded and the date of the performance included.
In the present case, petitioners received a copy of the decision on July 1, 1999. Conformably with Section
1, Rule 22, in relation to Section 3, Rule 41, July 1, 1999 should be excluded from the computation of the
fifteen-day period; hence, the 15-day period should be computed from July 2, 1999. Counting 15 days
from July 2, 1999, the 15th day fell on July 16, 1999; as such, petitioners had until July 16, 1999 within
which to perfect their appeal from the decision of the trial court or file their application under Section
20, Rule 57.
Section 3, Rule 13 provides that a pleading may be filed by registered mail, and the date of the mailing as
shown by the post office stamp on the envelope or the registry receipt shall be considered as the date of
the filing thereof.
SEC. 3. Manner of filing. The filing of pleadings, appearances, motions, notices, orders, judgments and all
other papers shall be made by presenting the original copies thereof, plainly indicated as such,
personally to the clerk of court or by sending them by registered mail. In the first case, the clerk of court
shall endorse on the pleading the date and hour of filing. In the second case, the date of the mailing of
motions, pleadings, or any other papers or payments or deposits, as shown by the post office stamp on
the envelope or the registry receipt, shall be considered as the date of their filing, payment, or deposit in
court.The envelope shall be attached to the record of the case.

SEC. 20. Claim for damages on account of improper, irregular or excessive attachment. An application for Under Section 7, Rule 13 of the Rules of Court, pleadings may be served by registered mail or by ordinary
damages on account of improper, irregular or excessive attachment must be filed before the trial or mail:
before appeal is perfected or before the judgment becomes executory, with due notice to the attaching
SEC. 7. Service by mail. Service by registered mail shall be made by depositing the copy in the office, in a
party and his surety or sureties, setting forth the facts showing his right to damages and the amount
sealed envelope, plainly addressed to the party or his counsel at his office, if known, otherwise at his
thereof. Such damages may be awarded only after proper hearing and shall be included in the judgment
residence, if known, with postage fully pre-paid, and with instructions to the postmaster to return the
on the main case.
mail to the sender after ten (10) days if undelivered. If no registry service is available in the locality of
An application for damages against the bonds must be filed in the same case where the bond was issued, either the sender or the addressee, service may be done by ordinary mail.
either (a) before the trial or (b) before the appeal is perfected or (c) before the judgment becomes
The Court notes that petitioners filed their application and served a copy thereof on respondent by
executory. [25] The principal party and his surety or sureties must be notified of said application. This rule
registered mail on July 16, 1999. As of said date, the decision of the RTC had not yet become final and
is mandatory.[26] In the absence of due notice to the surety, no judgment for damages may be entered
executory, and the fifteen-day period to appeal the decision had not yet lapsed.Thus, the application of
and executed against it. [27]
the petitioners with the RTC was not yet time-barred.
In this case, petitioners, as defendants below, received the Decision of the RTC dated June 25,
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision of the Court of Appeals in CA-
1999 on July 1, 1999. Under Rule 41 of the Revised Rules of Court, the decision may be appealed to the
G.R. CV No. 77593 isREVERSED. The Court of Appeals is ordered to REINSTATE the appeal of petitioners
CA by filing a notice of appeal with the court which rendered judgment or final order within fifteen (15) and to resolve the same in due course. No costs.
days from notice thereof.
SO ORDERED.
After the lapse of the fifteen-day period, the judgment or final order becomes final and executory and is
beyond the power or jurisdiction of the court which rendered it to further amend or reverse. [28] The
court loses jurisdiction over the case except to issue orders for the protection and preservation of the
rights of the parties which do not involve any matter litigated by the appeal, approve compromises,
permit appeals of indigent litigants, order execution pending appeal, and allow withdrawal of the
appeal. [29]

Article 13, last paragraph of the New Civil Code provides that in computing a period, the first day shall be
excluded and the last day included. Section 1, Rule 22, of the Revised Rules of Court also provides that, in
computing any period of time prescribed or allowed by the Rules, or by order of the court or by any
 95

[G.R. No. 158495. October 21, 2004] In Criminal Case No. 1191-M-95:

ELIZABETH EUSEBIO-CALDERON, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.
D E C I S I ON
YNARES-SANTIAGO, J.:
This is a petition for review under Rule 45 of the Rules of Court, assailing the Decision [1] dated April 30,
2001 of the Court of Appeals in CA-G.R. CR No. 23466, which reversed and set aside the Decision [2] dated
June 17, 1999 of the Regional Trial Court of Malolos, Bulacan, Branch 79, acquitting the accused of the
crime of Estafa in the consolidated Criminal Cases No. 1190-M-95, 1191-M-95, and 1192-M-95 but
ordering her to pay civil liability to the following: Amelia Casanova in the total amount of P130,900.00;
Teresita Eusebio in the total amount of P172,250.00; and Manolito Eusebio in the total amount of
P60,000.00.
That in or about the months of May to November 1994, in the municipality of Pulilan, province of
Bulacan, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, by
means of deceit, false pretenses and fraudulent manifestations, and pretending to have sufficient funds
with the Allied Bank, PCIBank and Planters Bank, Plaridel Branch, did then and there willfully, unlawfully
and feloniously, prepared, issue and make out the following checks to wit:
BANK CHECK NO. DATE AMOUNT
Allied Bank 16076401 11-15-94 P52,500.00
-do- 16076402 11-30-94 105,000.00
PCIB 214730 11-30-94 2,500.00

Petitioner Elizabeth Eusebio-Calderon was charged with Estafa in three separate Informations, to wit: PCIB 214796 11-30-94 1,750.00

In Criminal Case No. 1190-M-95: Planters Bank 15109960 12-03-94 5,000.00

That in or about the months of May to November, 1994, in the municipality of Pulilan, province of Allied Bank 16083156 12-03-94 2,500.00
Bulacan, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, by
Planters Bank 15094519 11-30-94 3,000.00
means of deceit, false pretenses and fraudulent manifestations, and pretending to have sufficient funds
with the Allied Bank, Planters Bank and PCIBank, Plaridel Branch, did then and there willfully, unlawfully (Total Amount Supplied) P172,250.00
and feloniously, prepared, issue and make out the following checks to wit:
drawn against the said banks, and deliver the said checks to one Teresita Eusebio as exchange for cash
BANK CHECK NO. DATE AMOUNT received from the said Teresita Eusebio, knowing fully well that at the time the checks were issued, her
representations were false for she had no sufficient funds in the said bank, so much so, that upon
Allied Bank 16041982 11-30-94 P100,000.00
presentation of the said checks with the said banks for deposit or encashment, the same were
Planters Bank 115954 12-2-94 4,500.00 dishonored and refused payment for having been drawn against a Closed Account and inspite of
repeated demands to deposit with the said banks the total amount of P172,250.00, the said accused
-do- 115961 12-4-94 9,500.00 failed and refused to do so, to the damage and prejudice of the said Teresita Eusebio in the said total
amount of P172,250.00. [4]
-do- 15109854 12-4-94 2,500.00
In Criminal Case No. 1192-M-95:
-do- 15109930 12-7-94 5,000.00
That in or about the months of June to November, 1994, in the municipality of Pulilan, province of
PCIB 214723 12-7-94 5,000.00 Bulacan, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, by
means of deceit, false pretenses and fraudulent manifes tations, and pretending to have sufficient funds
Planters Bank 115968 12-9-94 4,400.00
with the Allied Bank and Planters Bank, Plaridel Branch, did then and there willfully, unlawfully and
(Total Amount Supplied) P130,900.00 feloniously, prepared, issue and make out the following checks to wit:

drawn against the said banks, and deliver the s aid checks to one Amelia Casanova as exchange for cash BANK CHECK NO. DATE AMOUNT
received from the said Amelia Casanova, knowing fully well that at the time the checks were issued, her
Allied Bank 16083115 12-3-94 P 2,500.00
representations were false for she had no sufficient funds in the said bank, so much so, that upon
presentation of the said checks with the said banks for deposit or encashment, the same were -do- 16063578 12-6-94 50,000.00
dishonored and refused payment for having been drawn against a Closed Account and inspite of
repeated demands to deposit with the said banks the total amount of P130,900.00, the said accused -do- 16063577 12-6-94 2,500.00
failed and refused to do so, to the damage and prejudice of the said Amelia Casanova in the said total
amount of P130,900.00. [3] -do- 16076436 12-13-94 2,500.00

Planters Bank 116202 12-13-94 2,500.00
(Total Amount Supplied) P60,000.00
drawn against the said banks, and deliver the said checks to one Manolito G. Eusebio as exchange for
cash received from the said Manolito G. Eusebio, knowing fully well that at the time the checks were
issued, her representations were false for she had no sufficient funds in the said bank, so much so, that
upon presentation of the said checks with the said banks for deposit or encashment, the same were
dishonored and refused payment for having been drawn against a Closed Account and inspite of
repeated demands to deposit with the said banks the total amount of P60,000.00, the said accused failed
and refused to do so, to the damage and prejudice of the said Manolito G. Eusebio in the said total
amount of P60,000.00. [5]
The private complainants, Teresita Eusebio, Amelia Casanova and Manolito Eusebio, are petitioners aunt
and cousins, respectively.
On May 15, 1994, petitioner visited her Aunt Teresita in Bulacan to borrow P50,000.00, in exchange for
which she issued an Allied Bank Check No. 16076401, postdated November 15, 1994, in the amount of
P52,500.00. On May 30, 1994, petitioner again borrowed from Teresita the amount of P100,000.00, in
exchange for which she issued Allied Bank Check No. 16076402, postdated November 14, 1994, in the
amount of P105,000.00.
Also on May 30, 1994, Amelia Casanova went to the drugstore of petitioner and lent her the amount of
P100,000.00, allegedly to be used for the expansion of her business. In exchange, petitioner issued Allied
Bank Check No. 16041982, postdated November 30, 1994, for P100,000.00 and six other checks in
various amounts purportedly to cover the interests.
Manolito Eusebio alleges that in November 1994, petitioner borrowed money from him because she
needed it for her pharmaceutical business. Manolito loaned her P50,000.00, for which she issued Allied
Bank Check No. 16063578 covering the principal amount of the loan, dated December 6, 1994, and four
other postdated checks for the interests thereon.
According to private complainants, petitioner assured them that the checks will be honored upon
maturity. They gave her the money because she showed them her pieces of jewelry which convinced
them that she has the ability to pay the loans.
In her defense, petitioner admits that she issued the checks but alleges that it was not done to defraud
her creditors. She claims that her dealings with private complainants started in 1987 with her uncle
Alberto, the husband of complainant Teresita and the father of Amelia and Manolito. Although her uncle
died in 1989, she continued to make good the value of the postdated checks she issued until 1990.
Finally, she asserts that she is an educated woman and she never had any intention to deceive the
private complainants.
After trial, the lower court rendered a joint decision finding petitioner guilty beyond reasonable doubt of
three counts of Estafa but ruled that her liability for the interest checks was only civil. The dispositive
portion of the decision reads:
In Criminal Case No. 1190-M-95:
PREMISES CONSIDERED the complainant in Criminal Case No. 1190-M-95 wherein the complainant is one
Amelia Casanova was able to prove beyond reasonable doubt the culpability of herein accused because
96
she would not have parted with her P100,000.00 if not for the assurance that the check issued was
properly funded.
WHEREFORE, the Court hereby renders judgment finding accused ELIZABETH E. CALDERON of Poblacion,
Pulilan, Bulacan guilty beyond reasonable doubt of the crime of Estafa defined and penalized under Par.
2 (d) of Art. 315, Revised Penal Code as amended by P.D. 818 and sentencing the said accused as follows:
1. To suffer an indeterminate sentence of imprisonment of nine (9) years and one (1) day of PRISION
MAYOR as minimum to SEVENTEEN (17) YEARS FOUR (4) months and one (1) day of RECLUSION
TEMPORAL as maximum;
2. To suffer the accessory penalties provided by law;
3. To pay the cost; and
4. To indemnify the complainant Amelia Casanova the sum of P100,000.00. (Exh. A)
Necessarily, the other checks exhibits B, C, D, E, F and G in the amount of P5,000.00, P5,000.00,
P4,400.00, P4,500.00, P9,500.00 and P 2,500.00 respectively in the total amount of P30,900.00 is hereby
DISMISSED the same being civil in nature and are interest of transaction other than the principal amount
of P100,000.00. [6]
In Criminal Case No. 1191-M-95:
PREMISES CONSIDERED, the court finds accused Elizabeth Calderon guilty beyond reasonable doubt of
the crime of ESTAFA defined and penalized under Par. 2 (d) of Art. 315, Revised Penal Code as amended
by P.D. 818 sentencing the said accused as follows:
1. To suffer an indeterminate sentence of imprisonment of Ten (10) years and One (1) day of PRISION
MAYOR as minimum to seventeen (17) years FOUR (4) months and one (1) day of RECLUSION TEMPORAL
as maximum;
2. To suffer the accessory penalties provided by law;
3. To pay the cost; and
4. To indemnify the complainant Teresita Eusebio the sum of P157,500.00 representing the two checks,
exhibits A and B. [7]
In Criminal Case No. 1192-M-95:
WHEREFORE, the court hereby renders judgment finding accused Elizabeth Calderon guilty beyond
reasonable doubt of the Crime of ESTAFA defined and penalized under Par. 2 (d) of Art. 315 of the
Revised Penal Code as amended by P.D. 818 and sentencing the said accused as follows:
1. To suffer an indeterminate sentence of imprisonment of FOUR (4) years 2 months and one (1) day of
PRISION CORRECCIONAL as minimum to eight (8) years and one (1) day of PRISION MAYOR;
2. To suffer the accessory penalties provided by law;
3. To pay the costs; and
4. To indemnify the complainant Manolito Eusebio the sum of P50,000.00.

The other checks exhibit B to E are hereby DISMISSED.[8]
The trial court denied petitioners Motion for Reconsideration for lack of merit. [9] Hence, petitioner
appealed the judgment of the trial court to the Court of Appeals.
In its Decision dated April 30, 2001, the Court of Appeals disposed of the appeal as follows:
WHEREFORE, the Decision appealed from in so far as it bears on the criminal liability of the accused is
REVERSED and SET ASIDE and a new judgment is issued ACQUITTING the accused of the crimes charged
on the ground that her guilt has not been proven beyond reasonable doubt. However, she is held civilly
liable as follows:
In Criminal Case No. 1190-M-95: To indemnify Amelia Casanova the total amount of P130,900.00;
In Criminal Case No. 1191-M-95: To indemnify Teresita Eusebio the total amount of P172,250.00;
In Criminal Case No. 1192-M-95: To indemnify Manolito Eusebio the total amount of P60,000.00;
all with interest thereon at the rate of 12% per annum effective December 20, 1994, the date of
complainants demand thru their counsel, until fully paid, and to pay costs.
SO ORDERED.[10]
In the instant petition for review, petitioner raises the following errors:
1. The Honorable Court of Appeals failed to consider that on the face of the Decision rendered by the
Presiding Judge of RTC Branch 17, Malolos City, thatinterest checks were dismissed but found the
appellant guilty with respect to the principal loan checks in the three cases above mentioned.
2. The Honorable Court of Appeals failed to consider that the whole transactions that transpired
between appellant and private appellees covered a period lasting in years whereby private appellees
charged appellant highly usurious interests which under current jurisprudence maintains that usurious
interests are void.
3. With utmost due respect, the Honorable Court of Appeals failed to consider that under the sorry state
of affairs which petitioner experienced when the instant three criminal cases were pending before RTC
Branch 79, Malolos City, that private respondents should have filed a separate civil complaint for their
alleged claim of Sum of Money.[11]
The issues for resolution are as follows: (1) Did the Court of Appeals err in finding the appellant civilly
liable to complainants with respect to the interest in the principal loan despite the dismissal of the
interest checks by the Regional Trial Court? (2) Is the interest agreed upon by the parties usurious? (3)
Should the private respondents file a separate civil complaint for the claim of Sum of Money?
We find the petition meritorious. Since the 1st and 3 rd issues are interrelated they shall be discussed
jointly.
In a criminal case, an appeal throws the whole case wide open for review. Issues whether raised or not
by the parties may be resolved by the appellate court. [12] When petitioner appealed her conviction, the
dismissal of the interest checks by the lower court did not preclude the Court of Appeals from reviewing
such decision and modifying her civil liability. The appeal conferred upon the appellate court full
97
jurisdiction and rendered it competent to examine the records, revise the judgment appealed from,
increase the penalty and cite the proper provision of the penal law.[13]
Under Article 29 of the Civil Code, when the accused in a criminal prosecution is acquitted on the ground
that his guilt has not been proven beyond reasonable doubt, a civil action for damages for the same act
or omission may be instituted. The judgment of acquittal extinguishes the liability of the accused for
damages only when it includes a declaration that the fact from which the civil liability might arise did not
exist.[14] Thus, Section 1, paragraph (a) of Rule 111 of the Rules of Court provides:
SECTION 1. Institution of criminal and civil actions. (a) When a criminal action is instituted, the civil action
for the recovery of civil liability arising from the offense charged shall be deemed instituted with the
criminal action unless the offended party waives the civil action, reserves the right to institute it
separately or institutes the civil action prior to the criminal action.
In the case of Manantan v. Court of Appeals,[15] we elucidated on the two kinds of acquittal recognizedby
our law as well as its different effects on the civil liability of the accused. Thus:
x x x. First is an acquittal on the ground that the accused is not the author of the act or omission
complained of. This instance closes the door to civil liability, for a person who has been found to be not
the perpetrator of any act or omission cannot and can never be held liable for such act or omission.
There being no delict, civil liability ex delicto is out of the question, and the civil action, if any, which may
be instituted must be based on grounds other than the delict complained of. This is the situation
contemplated in Rule 111 of the Rules of Court. The second instance is an acquittal based on reasonable
doubt on the guilt of the accused. In this case, even if the guilt of the accused has not been satisfactorily
established, he is not exempt from civil liability which may be proved by preponderance of evidence
only. This is the situation contemplated in Article 29 of the Civil Code, x x x.
An accused who is acquitted of Estafa may nevertheless be held civilly liable where the facts established
by the evidence so warrant.[16] Petitioner Elizabeth Calderon is clearly liable to the private respondents
for the amount borrowed. The Court of Appeals found that the former did not employ trickery or deceit
in obtaining money from the private complainants, instead, it concluded that the money obtained was
undoubtedly loans for which petitioner paid interest. The checks issued by petitioner as payment for the
principal loan constitute evidence of her civil liability which was deemed instituted with the criminal
action.
The civil liability of petitioner includes only the principal amount of the loan. With respect to the interest
checks she issued, the same are void. There was no written proof of the payable interest except for the
verbal agreement that the loan shall earn 5% interest per month. Under Article 1956 of the Civil Code,an
agreement as to payment of interest must be in writing, otherwise it cannot be valid.[17] Consequently,
no interest is due and the interest checks she issued should be eliminated from the computation of her
civil liability.
However, while there can be no stipulated interest, there can be legal interest pursuant to Article 2209
of the Civil Code.[18] It is elementary that in the absence of a stipulation as to interest, the loan due will
now earn interest at the legal rate of 12% per annum. [19] In the case of Eastern Shipping Lines, Inc. v.
Court of Appeals,[20] we established the guidelines particularly for the award of interest in the concept of
actual and compensatory damages, the rate of interest, as well as the accrual thereof as follows:
When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or
forbearance of money, the interest due should be that which may have been stipulated in writing.
 98

Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In
the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default,
i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil
Code. (Emphasis supplied)

Hence, petitioner is liable for the payment of legal interest per annum to be computed from December
20, 1994, the date when she received the demand letter. After the judgment becomes final and
executory until the obligation is satisfied, the amount due shall earn interest at 12% per year, the interim
period being deemed equivalent to a forbearance of credit. [21]

In view of our ruling that there can be no stipulated interest in this case, there is no need to pass upon
the second issue of whether or not the interests were usurious.

WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals in CA-G.R. CR No. 23466 is
AFFIRMED with the MODIFICATION that petitioner is ordered to pay Amelia Casanova the sum of
P100,00.00; Teresita Eusebio the sum of P157,500.00; and Manolito Eusebio the sum of P50,000.00 as
civil liability with legal interest of twelve percent (12%) per annum from December 20, 1994 until its
satisfaction.

Costs de oficio.

SO ORDERED.

PADILLA VS CA
Summary of the Case:
One night, Enrique Manarang noticed the accused appellant’s car running fast. After a while, a screech of
tires was heard and thus, made the officer run out and investigate. Not so long, the car continued to run,
so a hot-pursuit took place. Manarang then radioed the incident to the Police.
When the car was put to a stop, the driver rolled down the windows with his hands raised. The officers
then noticed that it was the famous actor, Robin Padilla. While apprehended, because of the hit-and-run
incident, the police saw the revolver tucked in the left waist of Robin. So, the police insisted that the gun
be shown in the office if it was legal. The crowd had formed and Robin was shaking their hands and
pointing to the police while saying “iyan kinuha ang baril ko”, as if it was in the movies. The gesture then
revealed a magazine clip of a rifle which made the police suspect that there is a rifle inside the vehicle.
Then the rifle was seen. The other firearms were voluntarily surrendered by Robin.
Now, Robin’s defense was that his arrest was illegal and consequently, the firearms and ammunitions
taken in the course thereof are inadmissible in evidence under the exclusionary rule.
Robin Padilla was arrested, tried, and convicted for illegal possession of firearms. He was in possessionof
a .357 caliber revolver, Smith and Wesson with 6 live ammunitions, One M-16 baby Armalite Rifle with
ammunitions, One .380 Pietro Barreta with 8 live ammunitions, and six live double action ammunitions
of .38 caliber revolver.
Relation to Article3: Section 2.
Robin claimed that there was no search warrant or warrant of arrest thus, making his arrest illegal and
the evidences inadmissible. The Bill of rights’ purpose is to put limit to the government’s power. In the
People vs. Marti case, the government was not involved. In this case, the government is involved but it
was not illegal.
Why? According to what’s written in the case, a peace officer or a private person may arrest a person: (a)
when the person has committed, is actually committing or is attempting to commit and offense, (b)
when an offense has in fact just been committed, and he has personal knowledge of facts indicating that
the person to be arrested has committed it.
The instances above clearly explain the legality of the arrest. Robin Padilla, my idol had first sideswept a
balut vendor and the incident was heard by Manarang and he saw Robin fled away from the scene, thus,
committing a hit-and-run. And Enrique Manarang was a peace officer.
When he was halted, the firearms were revealed to the police officers without their act of searching. The
firearms were in “plain view”. And the firearms were found by the police in their pursuit of their official
duties. And the police have the right as to where they are because they were in pursuit of Robin when
they found the firearms
. Ramiscal Jr vs SANDIGANBAYAN and People of the Philippines
GR Nos 172476-99 September 15, 2010
Facts:
Ramiscal Jr (Ramiscal) was a retired officer of AFP and the former president of AFP-Retirement and
Separation Benefits System (AFP-RSBS). During his incumbency, the BOD of AFP-RSBS approved the
acquisition of 15,020 sq. m. of land for development as housing projects. On August 1, 1997 AFP -RSBS as
represented by Ramiscal Jr., and Flaviano the attorney-in-fact of 12 individual vendors executed and
99
signed a bilateral Deed of Sale (1st Deed) over the subject property at the agreed price of P 10,500.00
per sq. m. After the payment @ P 10,500.00 per sq. m., Flaviano executed and signed a unilateral Deed
of Sale (2nd Deed) over the same property with a purchase price of P 3,000.00 per sq. m. Thereafter the
2nd Deed was presented by Flaviano for registration which became the basis of the Certificate of Title of
the said property.
Ramiscal Jr filed his first Motion for Reconsideration date February 12, 1999 with a supplemental motion
dated May 28, 1999 regarding the findings of the Ombudsman. With this, a panel of prosecutors was
tasked to review the records of the case, they found out that Ramiscal Jr., indeed participated in an
affixed his signature on the contracts and found probable cause. The Ombudsman acted positively onthe
findings of the prosecutor and scheduled the arraignment of Ramiscal Jr. Howver, Ramiscal Jr., refusedto
enter a plea for petitioner on the ground that there is a pending resolution of his second Motion for
Reconsideration.
Issue:
Whether or not the second Motion for Reconsideration is valid and should hold his arraignment.
Whether or not there is probable cause to file a case for violation of Section 3 (e) of the Anti-Graft and
Corrupt Practices Act and falsification of public documents.
Ruling:
No, Sec 7 of Rule 11 of the Rules provides that only one motion for reconsideration or reinvestigation of
an approved order or resolution shall be allowed xxxxx the filing of a motion for
reconsideration/reinvestigation shall not bar the filling of the corresponding information in Court on the
basis of the finding of probable cause in the resolution subject of the motion.
The arraignment may be suspended under Sec. 11 of Rule 116 of the Rules of Court are: unsoundness of
mind, prejudicial question and a pending petition for review of the resolution of the prosecutor in the
DOJ in which the suspension shall not exceed 60 days. Ramiscal Jr., failed to show that any of the
instances constituting a valid ground for suspension of arraignment obtained in this case.
With respect to the finding of probable cause, it is the Ombudsman who has the full discretion to
determine whether or not a criminal case should be filed in the Sandiganbayan, once the case has been
filed with the said court, it is the Sandiganbayan, and no longer the Ombudsman which has full control of
the case. Ramiscal Jr., failed to establish that Sandiganbayan committed grave abuse of discretion, thus,
there is probable cause in the filing of the case.

[A.C. No. 4552. December 14, 2004]
JOSE A. ROLDAN, complainant, vs. ATTY. NATALIO PANGANIBAN and ATTY. JUANITO P.
NOEL, respondents.
RE SO LUT IO N
AUSTRIA-MARTINEZ, J.:
Before us is an administrative case for disbarment filed by complainant Jose A. Roldan against
respondents Atty. Natalio M. Panganiban and Atty. Juanito P. Noel. Complainant charges that
respondent lawyers reneged in their duties and obligations towards him as their client, especially in the
complainants right to appeal to the higher court after losing his case in the lower courts. The allegations
in the complaint dated February 12, 1996 [1] in support of the accusations are as follows:
1. Na ako ang plaintiff sa Civil Case No. 144860-CV M.I.T. Branch 25 Jose A. Roldan vs. Ramon Montano&
Robert Montano, na ang Judge ay si Honorable Severino De Castro, Jr. na ang kaso ay Recovery of
possession with damages. Itoy iniapila ko sa RTC Branch 43 with Civil Case No. 95 -73739 na ang Judge
naman dito ay si Honorable Manuel F. Lorenzo ng RTC. Si Atty. Panganiban at Atty. Noel ang abogado ko.
...
4. Na noong February 6, 1995 bago kami pumasok sa court room ay nagtanong sa akin si Atty. Noel, ng
ganito: Mr. Roldan nasaan nga pala yung resibo na ibinigay ni Tessie sa iyo na nagbigay ka ng down
payment na Ten Thousand Pesos (P10,000.00) noong March 1, 1986. Agad akong sumagot at sinabi ko sa
kaniya, Atty. Noel lahat po ng original ay hiningi ninyo sa akin, lahat po ay binigay ko sa inyo kasama
iyong resibo ni Tessie Dalusong, na akoy magbigay ng Ten Thousand Pesos bilang downpayment sa
ipinagbili niyang bahay sa akin. Agad siyang sumagot Wala kang ibinibigay sa akin!
5. Na kaya nga sinabi ko kay Atty. Noel na: Ibigay ninyo sa akin ang folder at ako ang hahanap ng resibo ni
Tessie Dalusong. Tumulong din si Atty. Noel, at nakita din namin. Sinabi ni Atty. Noel Sayang hindi na
natin maipasok ito, hindi na kasi pwedeng magpasok pa ng mga ibidensya. Di ko alam kung bakit hindi
niya ipinasok noon pa man. (Ang resibo na nagpapatunay na ako ang unang nakabili ng bahay sa 1723
Pedro Gil St., Paco, Maynila).
6. Na noong nasa loob na kami ng court room ay handa na ako sa sinasabi ni Atty. Noel no Rebuttal pero
nagtaka ako kinumbinsi ako na diumano ay malinaw na ang aking deklarasyon at malinaw ang mga
ebidensya kaya hindi na raw dapat mag rebuttal i-waive na lang daw sa Memorandum kaya nga sinabi ng
Judge na: Gumawa kayo ng Memoranda within fifteen days submitted for decision. Noong March 8, 1995
ang memorandum ay submitted for decision;
7. Na noong Abril 7, 1995 sinabi ko kay Atty. Noel, Bakit may ibinigay na zerox copies ng decision si
Robert Montano na aking kalaban sumagot si Atty. Noel, at sinabi sa akin Tsekin mo sa court. Gayon nga
ang aking ginawa. At bumalik ako kay Atty. Noel, at sinabi ko: Totoo nga na may decision na. Sinabi ni
Atty. Noel na: Ginapang nila yun, sapalagay mo, magkano ang inilagay nila? Sa palagay ko ay hindi lang
trenta mil (P30,000.00) pesos ang magagastos nila sa kasong ito, yun ang isinagot ko;
8. Na iminungkahi ko kay Atty. Noel na magpayl ng motion for reconsideration, sinagat ako ni Atty. Noel
na: Ginapang na nila yun kaya dapat umapila na lang tayo. Sinabi ko kay Atty. Noel na: Kung matalo pa
rin ako dito, ay dalhin natin sa Supreme Court para parehas ang laban; Na bilang bahagi nito inilakip ko
100
dito ang decision ng MTC; at ang apilasyon sa RTC, at ang petsa ng decision ng RTC na tinaggap ni Atty.
Noel.
9. Na noong Abril 24, 1995 umapila ako sa Court of Appeal makaraan ang ilang buwan ay dumating sa
office ni Atty. Noel at Atty. Panganiban, noong November 13, 1995 ang decision subalit tinawagan akong
sekretarya nila Atty. Noel at Atty. Panganiban noon lang November 24, 1995. Tinanong ko ang sekretarya
ni Atty. Panganiban kung nasaan si Atty. Noel, ang sagot ng sekretarya ay Nasa probinsiya maraming
inaasikaso doon. Agad kong sinabi: Hindi ba fifteen days lang para maka-apila sa Supreme Court.
Sumagot si Zeny at sinabi Isang buwan daw yun para sagutin.
10. Na madalas kong tawagan si Zeny (ang sekretarya ni Atty. Panganiban) na sinasabi kong nakahanda
na ang pangbayad gawin na ninyo ang apilasyon sa Supreme Court, itoy madalas kong sabihin sa
sekretarya (si Zeny) kayat ibinigay niya ang bagong office ni Atty. Noel sa Gedisco Centre Rm. 134, 1564
Mabini St., Ermita, Manila.
11. Na madalas akong magpunta sa bagong office ni Atty. Noel gaya noong Dec. 1, 1995, Dec. 4, 1995,
Dec. 5, 1995, Dec. 7, 1995, Dec. 8, 1995 at noon pang huling linggo ng November ay sisimulan ko ng
sabihin sa dalawang sekretarya (si Zeny at Marie Cris) na gawin na ang aking apilasyon sabihin kay Atty.
Noel sa Supreme Court.
12. Na noong December 12, 1995 maaga pa ay nagpunta ako sa office ni Atty. Noel sa Gedisco 3 rd Flr.
Mabini St., Ermita, Manila. Tinanong ko ang kaniyang sekretarya kung nakausap si Atty. Noel, sinagot ako
ng sekretarya at sinabing Tinanong ko si Atty. Noel kung yari na yung apilasyong ipinagagawa ninyo (Jose
Roldan) hindi po niya ako sinasagot.
13. Na kaya agad akong magpunta sa RTC Branch 43 upang alamin ang katotohanan nabatid ko noon
lang, na akoy natalo ng walang kalaban-laban, pagkat nag-laps na o lampas na ang panahong ibinibigay
ng batas para makapag-payl ng apilasyon sa Supreme Court.
14. Na dahil dito sa mga panloloko, at pagwawalang bahala sa aking kaso ni Atty. Noel, at Atty.
Panganiban ay idinidimanda ko sila ng Damages na halagang one hundred fifty thousand (P150,000.00)
pesos at dapat silang alisan ng karapatan na makapag-practice sa kanilang propesyon.
In his Comment dated August 8, 1996, Atty. Panganiban avers that he was neither aware nor did he
participate in the prosecution of Civil Case No. 144860-CV M.I.T. Branch 25 Jose A. Roldan vs. Ramon
Montano & Robert Montano and in the appeal of said case to the Regional Trial Court (RTC), Branch 43;
they do not have a lawyer-client relationship because he is on leave in the practice of law since October
18, 1993 when he was designated Acting Mayor of Laurel, Batangas, and during his incumbency as such,
and up to the filing of this administrative complaint in 1996, he is still on leave as law practitioner
because he was elected Mayor of Laurel, Batangas in the last 1995 election; probably, complainant
included him as respondent because he thought that he is practicing law and is still an associate of Atty.
Juanito P. Noel, due to the fact that on some occasions complainant might have seen him or they might
have talked casually in the law office from which he was on leave in his practice of law because he drops
there from time to time to meet visitors from Laurel who are living and who have problems in Metro
Manila; and he has not received any single centavo from the complainant.
In his Comment, dated August 29, 1996, Atty. Noel alleges: Sometime in 1994, he agreed to represent
complainant in recovering a one-half portion of the ground floor of a house located at 1723 Pedro Gil St.,
Paco, Manila which complainant bought from one Simplicia Villanueva represented by her daughter
Teresita Dalusong on November 28, 1986. A civil complaint for recovery of ownership and possession

was filed on February 8, 1994 with the RTC but upon the effectivity of the law expanding the jurisdiction
of the Metropolitan Trial Court (MTC) the case was transferred to the MTC. From the evidence of the
defendant, he honestly saw no need to present a rebuttal evidence. The MTC rendered a decision
dismissing the case on the alleged ground that the identity of the subject matter of the action was not
clearly established. He filed an appeal in due time to the RTC of Manila (Branch 43) and not with the
Court of Appeals as stated in paragraph 9 of the complaint. On November 13, 1995, he received a copy of
the RTC decision dated October 10, 1995, affirming the decision of the MTC. Through the telephone, he
informed the complainant about the decision of the RTC. Complainant instructed him to prepare an
appeal to the higher court which actually refers to the Court of Appeals and not with the Supreme Court
as complainant claims. He advised the complainant that he could find no error in the said decision and a
further appeal would be frivolous and without merit and requested the complainant to come over so
that he could discuss the matter with him. Whenever the complainant went to the law office, he failedto
see him because the latter was still attending court hearings. The complainant asked for the records of
the case which was given by his secretary. Complainant never returned the case folder to him, neither
did he call up by phone, or see him personally. He then assumed that the complainant had hired another
lawyer to handle the appeal. He was surprised when he received on July 18, 1996 a copy of the
resolution of this Honorable Court dated June 19, 1996, requiring them to file their comment on the
complaint of Jose A. Roldan.
We referred the matter to the Integrated Bar of the Philippines (IBP) for investigation. After hearing, IBP
Investigating Commissioner Manuel A. Quiambao submitted his Report and Recommendation dismi ssing
the complaint against Atty. Panganiban and imposing censure to Atty. Noel. In a Resolution dated
February 27, 2004, the IBP adopted and approved the said Report and Recommendation.
We shall first resolve the issue of the existence or non-existence of lawyer-client relationship between
Atty. Panganiban and the complainant.
From a careful reading of the records of this case, it appears that Atty. Panganiban and Atty. Noel used to
be law associates. However, Atty. Panganiban went on leave from the practi ce of law since October 18,
1993 when he was designated as acting mayor of Laurel, Batangas [2] due to the indefinite leave of
absence filed by the mayor and by reason of his election as mayor of the said municipality in 1995. The
complainant claims that he secured the services of Atty. Panganiban on January 6, 1994.[3] It is thus clear
that Atty. Panganiban was not an active associate of the law firm, since at that time, he was already on
leave from the practice of law. Moreover, the complaint filed in 1996 before the RTC for Recovery of
Possession and Ownership with Damages was prepared and signed by Atty. Noel alone and not in any
representation of any law firm. In fact from the filing of the said civil case in the RTC, it was Atty. Noel
who represented the complainant. Not once did Atty. Panganiban appear for the complainant nor did he
sign any document pertaining with the aforesaid case. Necessarily, the complaint against Atty.
Panganiban must be dismissed.
As to the complaint against Atty. Noel.
The main issues to be resolved are: (1) whether there was a deliberate attempt to suppress evidence on
the part of Atty. Noel, to the prejudice of complainant and (2) whether it was correct for Atty. Noel to
refuse to file a further appeal of the case to the Court of Appeals by way of petition for review despite
the manifest desire of the complainant to do so.
Anent the first issue.
101
Complainant insists that Atty. Noels failure to present in evidence the receipt dated March 1, 1986 was
fatal to his cause. The receipt shows that complainant made a partial payment of P10,000.00 of
the P40,000.00 price of the subject property. Complainant claims that this piece of document proves that
complainant bought the subject property ahead of the defendants who bought it only on July 30, 1986.
Thus, to the mind of the complainant, the non-presentation of the subject receipt is suppression of
evidence.
Atty. Noel denied receiving the subject receipt and asserts that the same was mere fabrication of the
complainant. He insists that said receipt did not exist during the preparation and filing of the complaint
and even during the presentation of evidence. Otherwise, he argues that such fact should have been
alleged in the complaint to show that complainant bought the subject property ahead of the other
buyer. Atty. Noel also claims that assuming that the receipt was given to him, the same cannot be used
as evidence because the receipt shows that it was signed by one Romeo Dalusong who is not a party to
the sale; neither does it appear in the receipt that Romeo was acting in a representative capacity.
A short historical backdrop is necessary for a clearer insight of this issue.
It appears that the subject property was subjected to a double sale by the same seller. The Deed of Sale
of the complainant is dated November 28, 1986 while that of the other buyer is dated July 30, 1986. But
complainant claims that actually the sale as to him took place on March 1, 1986 as evidenced by the
subject receipt. Complainant however failed to take possession of the subject property as the same is
already in the possession of the other buyer. Complainant filed an ejectment case[4] against the tenant of
the other buyer but the same was dismissed for the reason that complainant failed to show that he had
proprietary right over the property in question. Unable to take possession of the subject property,
complainant filed a case against the seller for the annulment of the contract of sale, the Deed of Sale
dated November 28, 1986. Complainant won and the court awarded him damages of P80,000.00.
Subsequently, the seller and the complainant entered into a Compromise Agreement. [5] The seller,
agreed to sell one-half of her duplex house which is the same property that was previously sold to
complainant on November 28, 1986, including all her proprietary rights over the land, in the amount
ofP80,000.00. Since the Court awarded damages to the complainant in the same amount, this was set-off
against the price of the property. Pursuant to the said compromise agreement, a Deed of Absolute Sale
and Transfer of Right [6] in favor of the complainant was executed on December 22, 1990 by the seller
over the said property.
Even with the sale on December 22, 1990 over the subject property as a result of the compromise
agreement, complainant still failed to take possession of the subject property, hence he filed a complaint
for Recovery of Possession and Ownership with Damages against the other buyer. It is in this case that
complainant claims that Atty. Noel failed to present the subject receipt. The MTC dismissed the
complaint and the RTC on appeal, dismissed it again. Upon failure of Atty. Noel to file a petition for
review with the Court of Appeals, complainant filed the present administrative complaint against him.
We find credence to the allegation of Atty. Noel that the subject receipt was not in existence at the time
he prepared the complaint or even at the time of presentation of evidence. The complaint was verified
by the complainant stating the fact that he caused its preparation, that he read the same and attested
that the contents thereof are true and correct. If complainants allegation that he gave the receipt to
Atty. Noel at that time, and considering the importance of the subject receipt to his case, he should have
called the attention of Atty. Noel that there was no allegation of the existence of the subject receipt.
We thus hold that Atty. Noel is not guilty of suppressing evidence.

As to the second issue, that is, the issue of propriety of Atty. Noels refusal or failure to file a petition for
review before the Court of Appeals.
It is the contention of the complainant that he lost the right to file a further appeal because he was not
informed immediately of the result of the appeal to the RTC. Complainant insists that Atty. Noel, through
his secretary, called the complainant only on November 24, 1995 or 11 days after the receipt of the
adverse RTC decision and was given the impression that he has still one month within which to file an
appeal. The complainant also said that he paid the respondents visits on December 1, 4, 5, 7 and 8, 1995,
to follow up the filing of the appeal to the higher court but that he was not able to talk to Atty. Noel;that
it was only when he went to the RTC that he learned that he lost the case because the period of the
appeal has lapsed.
Atty. Noel contends that he received the RTC decision on November 13, 1995 and on the following day,
he instructed his secretary to contact the complainant to inform him of the adverse RTC decision with
the directive for the complainant to call up Atty. Noel; that when complainant called, he was instructed
by the complainant to prepare an appeal to the higher court; that he told the complainant that there is
no need to appeal the case because, first, the decision of the court is correct, and second, he is obligated
by the code of professional responsibilities to refrain from filing a frivolous and unmeritorious appeal;
that thereafter, complainant went to his office twice, the last of this instance was when complainant
took all the records of the case and never came back which led him to believe that complainant will not
appeal the adverse RTC decision. Atty. Noel further states that, in any event, his relationship with the
complainant ended upon the issuance of the decision and that the complainant should not expect that
he would still appeal the case.
We find for the complainant.
It is noted that the complainant has been very diligent in following up the status of the case. From the
time, complainant filed the case with the MTC up to the time he appealed with the RTC, complainantwas
vigilant with his rights constantly in contact with Atty. Noel. We find it strange therefore that upon
receipt of the adverse RTC decision, it would seem, if Atty. Noels version is to be given credence, the
complainant had lost his zeal and just allowed the time to appeal to lapse. As correctly observed by the
Investigating Commissioner in his Report:
Here was a complainant who went through several litigations over the same subject matter, including a
case of ejectment, a case of annulment of contract of sale with damages, a case of action for recovery of
ownership and possession, an appeal to the Regional Trial Court, and he did not seem perturb that he
lost it (the appeal) and did not find it essential to discuss the matter with his lawyer for possible remedial
action? That is, as claimed by his lawyer?
...
As opposed to the general denial given by the respondent about the claim that the complainant followed
up his case several times with his office (outside of the two occasions that he conceded the complainant
did so), the complainant was precise in detailing the circumstances which described how he tried his best
to seek the presence of Atty. Noel to no avail. There were dates, detailed circumstances, and specific
places. Given the character which had characterized the effort of the complainant to seek appropriate
legal remedies for his complaints, the assertions would be consistent, that is, that he made great efforts
to find Atty. Noel.
102
We note that the complainant was informed about the adverse RTC decision within the 15-day
prescriptive period to appeal. As stated elsewhere, Atty. Noel received the adverse RTC decision on
November 13, 1995 and the complainant was informed about the adverse RTC decision on November24,
1995. Hence, complainant has still four days to file an appeal. However, Atty. Noel failed to ensure that
the client was advised appropriately. Atty. Noel entrusted entirely with his secretary the duty to inform
the complainant about the adverse decision. And the secretary informed the complainant rather late and
worse with the wrong information that the complainant has still a month within which to file an appeal.
This resulted to the lapse of the prescriptive period to appeal without complainant having availed of the
said remedy.
A lawyer shall not neglect a legal matter entrusted to him and his negligence in connection therewith
shall render him liable. [7] If only Atty. Noels position of not filing an appeal because it would only be
frivolous has been properly communicated to the complainant at the earliest possible time so that the
complainant would be able to seek the services of another lawyer for help, it would have been
commendable. A lawyers duty is not to his client but to the administration of justice; to that end, his
clients success is wholly subordinate; and his conduct ought to and must always be scrupulously
observant of law and ethics. [8] But as it was, Atty. Noels negligence as afore-discussed robbed the
complainant of the opportunity to at least look for another lawyer for professional help and file an
appeal, after all, it is the client who finally decides whether to appeal or not an adverse decision.
We cannot also accept the reasoning of Atty. Noel that he should not be expected to file an appeal for
the complainant because their lawyer-client relationship ended with the RTC decision. First, a lawyer
continues to be a counsel of record until the lawyer-client relationship is terminated either by the act of
his client or his own act, with permission of the court. Until such time, the lawyer is expected to do his
best for the interest of his client. [9] Second, Atty. Noel admitted that complainant instructed him to file
an appeal with the higher court. Even assuming that their contract does not include filing of an appeal
with the higher courts, it is still the duty of Atty. Noel to protect the interest of the complainant by
informing and discussing with the complainant of the said decision and his assessment of the same. A
lawyer shall represent his client with zeal within the bounds of the law.[10] It is the obligation of counsel
to comply with his clients lawful request. Counsel should exert all effort to protect the interest of his
client.
The determination of the appropriate penalty to be imposed on an errant lawyer involves the exercise of
sound judicial discretion based on the facts of the case.[11] In cases of similar nature, the penalty imposed
by the Court consisted of reprimand,[12] fine of five hundred pesos with warning, [13] suspension of three
months, [14] six months[15] and even disbarment [16] in aggravated case.
The facts of the case show that Atty. Noel failed to live up to his duties as a lawyer pursuant to the Code
of Professional Responsibility. We conclude that a suspension from the practice of law for one month is
just penalty under the circumstances.
Complainants claim for damages cannot be entertained in the present disbarment case as it is not the
proper forum. It is not an ordinary civil case where damages could be awarded.[17] A disbarment case is a
proceeding that is intended to protect the Court and the public from the misconduct of its officers; to
protect the administration of justice by requiring that those who exercise this important function shall be
competent, honorable and reliable, men in whom courts and clients may repose confidence. [18] It has
been emphasized in a number of cases that disbarment proceedings belong to a class of their own,
distinct from that of a civil or a criminal action.[19]
 103

Wherefore, the complaint against Atty. Natalio M. Panganiban is DISMISSED. Atty. Juanito P. Noel is
SUSPENDED for one month with a warning that a repetition of the same would be meted a more severe
penalty. Let a copy of this decision be attached to respondents personal record in the Office of the Bar
Confidant and copies be furnished to all chapters of the Integrated Bar of the Philippines and to all courts
of the land.

SO ORDERED.

CONLU VS AREDONIA
Before the Court is a complaint [1] for disbarment with a prayer for damages instituted by Antonio Conlu
(Antonio) against Atty. Ireneo Aredonia, Jr. (Atty. Ireneo) on grounds of gross negligence and dereliction
of sworn duty.
Antonio was the defendant in Civil Case No. 1048, a suit for Quieting of Title and Recovery of a Parcel of
Land commenced before the Regional Trial Court (RTC) in Silay City, Negros Occidental. [2] He engaged the
services of Atty. Ireneo to represent him in the case. On March 16, 1995, the RTC rendered
judgment [3] adverse to Antonio. Therefrom, Atty. Ireneo, for Antonio, appealed to the Court of Appeals
(CA) whereat the recourse was docketed as CA-G.R. CV No. 50075.
The CA, per its Resolution of February 10, 1997, eventually dismissed the appeal for non-filing of the
appellants brief within the reglementary period. Antonio got wind of the dismissal from his wife who
verified the status of the case when she happened to be in Manila. When confronted about the dismissal
action, Atty. Ireneo promised to seek reconsideration, which he did, but which the appellate court later
denied for belated filing of the motion.
In that motion[4] he prepared and filed, Atty. Ireneo averred receiving the adverted February 10, 1997 CA
Resolution[5] only on April 25, 1997, adding in this regard that the person in the law office who initially
received a copy of said resolution was not so authorized. However, the CA denied the motion for having
been filed out of time. As the CA would declare in a subsequent resolution dated December 3, 1997,
there was a valid receipt by Atty. Ireneo, as shown by the registry return card with his signature, of a
copy of the CAs February 10, 1997 Resolution. Accordingly, as the CA wrote, the motion for
reconsideration of the February resolution which bore the mailing date May 8, 1997 cannot but be
considered as filed way out of time.
In light of these successive setbacks, a disgusted Antonio got the case records back from Atty. Ireneo
and personally filed on October 13, 1997 another motion for reconsideration. By Resolution of December
3, 1997, the CA again denied [6] this motion for the reason that the prejudicial impact of the belated filing
by his former counsel of the first motion for reconsideration binds Antonio.
Forthwith, Antonio elevated his case to the Court on a petition for certiorari but the Court would later
dismiss the petition and his subsequent motion to reconsider the denial.
Such was the state of things when Antonio lodged this instant administrative case for disbarment with a
prayer for damages. To support his claim for damages, Antonio asserts having suffered sleepless nights,
mental torture and anguish as a result of Atty. Ireneos erring ways, besides which Antonio also lost a
valuable real property subject of Civil Case No. 1048.
Following Atty. Ireneos repeated failure to submit, as ordered, his comment, a number of extensions of
time given notwithstanding, [7] the Court referred the instant case, docketed as Administrative Case No.
4955, to its Office of the Bar Confidant (OBC) for evaluation, report and recommendation.
Acting on OBCs Report and Recommendation [8] dated November 23, 2000, the Court, by Resolution of
January 31, 2001, directed Atty. Ireneo to show cause within ten (10) days from noticelater successively
extended via Resolutions dated July 16 and 29, 2002why he should not be disciplinarily dealt with orheld
in contempt for failing to file his comment and to comply with the filing of it.
In separate resolutions, the Court (a) imposed on Atty. Ireneo a fine of PhP 2,000; [9] (b) ordered his arrest
but which the National Bureau of Investigation (NBI) cannot effect for the reason: whereabouts
104
unknown;[10] (c) considered him as having waived his right to file comment; and (d) referred the
administrative case to the Integrated Bar of the Philippines (IBP) for report, investigation and
recommendation. [11]
At the IBP, Atty. Ireneo desisted from addressing his administrative case, his desistance expressed by not
attending the mandatory conference or filing the required position paper. On the basis of the pl eadings,
the IBP-Commission on Bar Discipline (CBD) found Ireneo liable for violating Canon 1, Rules 1.01 and 1.03
and Canon 18, Rule 18.03 of the Code of Professional Responsibility and recommended his suspension
from the practice of law for a period of six (6) months, with warning. The salient portions of the
investigating commissioners Report and Recommendation[12] read as follows:
Uncontroverted and uncontested are respondents inability to file appellants Brief, his futile attempts to
mislead the Court of Appeals that he did not personally received [sic] the resolution of dismissal. His
filing of the Motion for Reconsideration five (5) months late. [s ic]
Aggravated by his failure to file his comment in the instant administrative complaint despite his
numerous motions for extension to file the same. [sic]
He is even adamant to comply with the show cause order of the bar confidant. The series of snobbish
actuations in several resolution of the Supreme Court enjoining him to make the necessary pleading. [sic]
By Resolution No. XVIII-2008-523, the IBP Board of Governors adopted and approved said report and
recommendation of the CBD.[13]
We agree with the inculpatory findings of the IBP but not as to the level of the penalty it recommended.
Res ipsa loquitur. Atty. Ireneo had doubtless been languid in the performance of his duty as Antonios
counsel. He neglected, without reason, to file the appellants brief before the CA. He failed, in short, to
exert his utmost ability and to give his full commitment to maintain and defend Antonios right. Antonio,
by choosing Atty. Ireneo to represent him, relied upon and reposed his trust and confidence on the
latter, as his counsel, to do whatsoever was legally necessary to protect Antonios interest, if not to
secure a favorable judgment. Once they agree to take up the cause of a client, lawyers, regardless of the
importance of the subject matter litigated or financial arrangements agreed upon, owe fidelity to such
cause and should always be mindful of the trust and confidence reposed on them. [14] And to add insult to
injury, Atty. Ireneo appeared not to have taken any effort to personally apprise Antonio of the dismissal
of the appeal, however personally embarrassing the cause for the dismissal might have been. As
mentioned earlier, Antonio came to know about the outcome of his appeal only after his wife took the
trouble of verifying the case status when she came to Manila. By then, all remedies had been lost.
It must be remembered that a retained counsel is expected to serve the client with competence and
diligence. This duty includes not merely reviewing the cases entrusted to the counsels care and giving
the client sound legal advice, but also properly representing the client in court, attending scheduled
hearings, preparing and filing required pleadings, prosecuting the handled cases with reasonable
dispatch, and urging their termination without waiting for the client or the court to prod him or herto do
so. The lawyer should not be sitting idly by and leave the rights of the client in a state of uncertainty.[15]
The failure to file a brief resulting in the dismissal of an appeal constitutes inexcusable negligence. [16] This
default translates to a violation of the injunction of Canon 18, Rules 18.03 and 18.04 of the Code of
Professional Responsibility, respectively providing:
CANON 18 A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE.

Rule 18.03 A lawyer shall not neglect a matter entrusted to him, and his negligence in connection
therewith shall render him liable.
Rule 18.04 A lawyer shall keep the client informed of the status of his case and shall respond within a
reasonable time to the clients request for information.
As if his lack of candor in his professional relationship with Antonio was not abhorrent enough, Atty.
Ireneo tried to mislead the appellate court about the receipt of a copy of its February 10, 1997
Resolution dismissing the appeal in CA-G.R. CV No. 50075. He denied personally receiving such copy, but
the CA found and declared that he himself received said copy. The CA arrived at this conclusion thru the
process of comparing Atty. Ireneos signature appearing in the pleadings with that in the registry return
card. Both signatures belong to one and the same person. Needless to stress, Atty. Ireneo had under the
premises indulged in deliberate falsehood, contrary to the self-explanatory prescriptions of Canon 1,
Rule 1.01 and Canon 10, Rule 10.01, which provide:
CANON 1 A LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS OF THE LAND AND PROMOTE
RESPECT FOR LAW AND LEGAL PROCEDURES.
Rule 1.01 A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.
CANON 10 A LAWYER OWES CANDOR, FAIRNESS AND GOOD FAITH TO THE COURT.
Rule 10.01 A lawyer shall not do any falsehood, nor consent to the doing of any in court; nor shall he
mislead, or allow the Court to be misled by any artifice. (Emphasis supplied.)
We cannot write finis to this case without delving into and addressing Atty. Ireneos defiant stance
against the Court as demonstrated by his repetitive disregard of its resolution to file his comment on the
basic complaint. After requesting and securing no less than three (3) extensions of time to file his
comment, he simply closed, so to speak, communication lines. And when ordered to give an explanation
through a show-cause directive for not complying, he asked for and was granted a 30-day extension. But
the required comment never came. When the Court eventually directed the NBI to arrest him, he just
left his last known address and could not be located.
The Courts patience has been tested to the limit by what in hindsight amounts to a lawyers impudence
and disrespectful bent. At the minimum, members of the legal fraternity owe courts of justice respect,
courtesy and such other becoming conduct so essential in the promotion of orderly, impartial and
speedy justice. What Atty. Ireneo has done was the exact opposite. What is clear to the Court by now is
that Ireneo was determined all along not to submit a comment and, in the process, delay the resolution
of the instant case. By asking several extensions of time to submit one, but without the intention to so
submit, Ireneo has effectively trifled with the Courts processes, if not its liberality. This cannot be
tolerated. It cannot be allowed to go unpunished, if the integrity and orderly functioning of the
administration of justice is to be maintained. And to be sure, Atty. Ireneo can neither defeat this Courts
jurisdiction over him as a member of the bar nor evade administrative liability by the mere ruse of
concealing his whereabouts.[17] Manifestly, he has fallen short of the diligence required of every member
of the Bar. The pertinent Canon of the Code of Professional Responsibility provides:
CANON 12 A LAWYER SHALL EXERT EVERY EFFORT AND CONSIDER HIS DUTY TO ASSIST IN THE SPEEDY
AND EFFICIENT ADMINISTRATION OF JUSTICE.
105
Rule 12.03 A lawyer shall not, after obtaining extensions of time to file pleadings, memoranda or
briefs, let the period lapse without submitting the same or offering an explanation for his failure to do
so.
Rule 12.04 A lawyer shall not unduly delay a case, impede the execution of a judgment or misuse Court
processes. (Emphasis supplied.)
A lawyer may be disbarred or suspended for gross misconduct or for transgressions defined by the rules
as grounds to strip a lawyer of professional license.[18] Considering, however, the serious consequences
of either penalty, the Court will exercise its power to disbar or suspend only upon a clear, convincing,
and satisfactory proof of misconduct that seriously affects the standing of a lawyer as an officer of the
court and as member of the bar.
In Heirs of Tiburcio F. Ballesteros, Sr. v. Apiag,[19] the Court penalized a lawyer who failed to file a pre-trial
brief and other pleadings, such as position papers, leading to the dismissal of the case with six months
suspension. In Soriano v. Reyes,[20] We meted a one-year suspension on a lawyer for inexcusable
negligence, the latter having failed to file a pre-trial brief leading to the dismissal of the case and failure
to prosecute in another case, and omitting to apprise complainant of the status of the two cases with
assurance of his diligent attention to them.
In this case, Atty. Ireneo should be called to task for the interplay of the following: his inexcusable
negligence that resulted in the dismissal of Antonios appeal, coupled by his lack of candor in not
apprising Antonio of the status of his appealed case; his attempt to mislead the CA in a vain bid to evade
the consequence of the belated filing of a motion for reconsideration; and, last but not least, his cavalier
disregard of the Courts directives primarily issued to resolve the charges brought against him by Antonio.
We deem it fitting that Atty. Ireneo be suspended from the practice of law for a period of one year, up
from the penalty recommended by the IBP Board of Governors. This should serve as a constant reminder
of his duty to respect courts of justice and to observe that degree of diligence required by the practice of
the legal profession. His being a first offender dictates to large degree this leniency.
The prayer for damages cannot be granted. Let alone the fact that Antonio chose not to file his position
paper before the IBP-CBD and, therefore, was unable to satisfactorily prove his claim for damages, a
proceeding for disbarment or suspension is not in any sense a civil action; it is undertaken and
prosecuted for public welfare. It does not involve private interest and affords no redress for private
grievance.[21]
WHEREFORE, respondent Atty. Ireneo Aredonia, Jr. is declared GUILTY of inexcusable negligence,
attempting to mislead the appellate court, misuse of Court processes, and willful disobedience to lawful
orders of the Court. He is hereby SUSPENDED from the practice of law for a period of one (1) year
effective upon his receipt of this Resolution, with WARNING that a repetition of the same or similar acts
will be dealt with more severely. Let a copy of this Decision be furnished the Office of the Bar Confidant,
the Integrated Bar of the Philippines, and all courts throughout the country.
SO ORDERED.

G.R. No. 166703 April 14, 2008
AMA COMPUTER COLLEGE, INC., petitioner,
vs.
ELY GARCIA and MA. TERESA BALLA, respondents.
D E C I S I ON
CHICO-NAZARIO, J.:
This Petition for Review on Certiorari under Rule 45 of the Rules of Court seeks to reverse the
Decision 1 dated 30 August 2004 of the Court of Appeals in CA-G.R. SP No. 81808 affirming the Decision
dated 29 May 2003 of the National Labor Relations Commission (NLRC) in NLRC NCR 00-03-01898-00.
The NLRC, in its Decision, affirmed the Labor Arbiter's Decision dated 25 March 2002, finding that the
dismissal by petitioner AMA Computer College, Inc. (ACC) of respondents Ely Garcia (Garcia) and Ma.
Teresa Balla (Balla) was illegal and granting of backwages and separation pay; but modified the same by
deleting the grant of 13th month pay, service incentive leave pay and cost of living allowance. The Court
of Appeals, in its Resolution dated 1 December 2004, denied ACC's motion for reconsideration of its
earlier Decision.
The factual antecedents of the case are as follows:
Garcia was hired as a janitress by ACC on 6 January 1988. On 15 May 1989, her employment st atus was
changed to probationary Library Aide. She became a regular employee on 15 February 1990.
Balla was hired as a Social Worker by ACC on 1 August 1996. She later became a Guidance Assistant in
the Guidance Department of ACC, and on 2 June 1997, became a regular employee.
On 21 March 2000, Anthony R. Vince Cruz, ACC Human Resource Director, informed Garcia and Balla and
52 other employees of the termination of their employment, thus:
This is to formally inform you that due to the prevailing economic condition of our economy and as part
of the austerity program of the company, the top management has decided to come up with a
manpower review of the AMA Group of Companies in order to streamline its operation and the growth
of the Organization.
In view of this, your position as Library Aide [for Ely; Guidance Assistant, for Teresa] has (sic) been found
no longer necessary for the reason that your function can be handled by the other existing staff.
Thus, we regret to inform you effective April 21, 2000, your employment with AMA Group of Companies
is hereby terminated. x x x. 2
Thereafter, Garcia and Balla filed a complaint with the Labor Arbiter for illegal dismissal and prayed for
the payment of separation pay, 13th month pay, and attorney's fees, alleging that ACC's streamlining
program was tainted with bad faith as there was no fair and reasonable criteria used therein, such as the
less preferred status, efficiency rating and authority. They asserted that certain acts of ACC belied its
claim of being adversely affected by the prevailing economic conditions, and that the statistics and
pattern of dismissal by the college indicate a nefarious intent to circumvent the law on the security of
tenure.
106
ACC, in its position paper, countered that Garcia and Balla's dismissal was due to the legitimate
streamlining by the company.
On 25 March 2002, the Labor Arbiter ruled that Garcia and Balla were illegally dismissed and ordered the
payment of their backwages and additional separation pay. The dispositive portion of the Labor Arbiter's
Decision3 reads:
Wherefore, premises all considered, judgment is hereby rendered finding the dismissal illegal and
ordering respondent [petitioner ACC] to pay complainants [Garcia and Balla] backwages and additional
separation pay.
The Research and Computation Unit, (sic) this Commission is hereby directed to effect the necessary
computation which shall form part of this decision.
Aggrieved by the Labor Arbiter's afore-quoted Decision, ACC appealed to the NLRC.
On 20 May 2003, the NLRC4 affirmed the assailed Decision of the Labor Arbiter with the modification of
deleting the award of 13th month pay, service incentive leave pay and cost of living allowance. The NLRC
thus ordered:
While We are in accord with the finding that complainants were illegally dismissed from employment,
We find the inclusion of the relief of 13 th month pay, Service Incentive Leave Pay and Cost of Living
Allowance as inappropriate.
Quite notable from the pro-forma complaint that no prayer for payment of cost of living allowance or
service incentive leave pay was indicated therein by the complainants (Records, p. 2). And, while they
may have indicated non-payment of the 13 th month benefit as a cause of action, nowhere in the Labor
Arbiter's decision can it be gleaned that the said relief was adjudged in favor of the complainants.
Deletion of the aforesaid monetary award is, therefore, decreed.
WHEREFORE, premises considered, the decision under review is hereby MODIFIED by DELETING the
relief of 13 th month pay, service incentive leave pay and cost of living allowance therefrom.
In other respects, the decision, insofar as it orders the payment to the complainants [Garcia and Balla]
their backwages and additional separation pay, shall stand AFFIRMED.
ACC filed a Motion for Reconsideration of the foregoing but the same was denied5 by the NLRC in a
Resolution dated 30 October 2003.
ACC then appealed 6 by way of Petition for Certiorari under Rule 65 of the Rules of Court to the Court of
Appeals alleging that the NLRC gravely abused its discretion amounting to lack or in excess of jurisdiction
in only partially modifying the Decision of the Labor Arbiter and affirming the rest thereof.
On 30 August 2004, the Court of Appeals rendered a Decision 7 affirming the Decision of the NLRC. In its
Decision, the Court of Appeals ruled that inquiry in a Petition for Certiorari under Rule 65 of the Rules of
Court is limited exclusively to the issue of whether or not respondent acted with grave abuse of
discretion, amounting to lack or in excess of jurisdiction, and does not go as far as to evaluate the
sufficiency of evidence upon which the NLRC and the Labor Arbiter based their determination.
ACC filed a motion for reconsideration but was denied by the Court of Appeals in a Resolution8 dated 1
December 2004.

Hence, the present Petition for Review under Rule 45 of the Rules of Court filed by ACC raising the
following errors9 of the Court of Appeals:
THE COURT OF APPEALS GRAVELY ERRED IN DEPARTING FROM THE ACCEPTED AND USUAL COURSE OF
JUDICIAL REVIEW[.]
THE COURT OF APPEALS GRAVELY ERRED WHEN IT SUSTAINED THE FINDING OF ILLEGAL DISMISSAL
NOTWITHSTANDING THE SUBSTANTIAL EVIDENCE ADDUCED BY PETITIONER TO THE CONTRARY[.]
THE COURT OF APPEALS GRAVELY ERRED WHEN IT REFUSED TO RECOGNIZE REDUNDANCY AS A BASIS IN
TERMINATING THE SERVICES OF RESPONDENT[S].
On 18 April 2005, We required10 Garcia and Balla to file their Comment within ten days from notice, but
they failed to comply therewith despite notice.
As a consequence, we required11 Garcia and Balla to show cause why they should not be held in
contempt of court for failure to file their desired comment. Again, they failed to comply with our show
cause order, thus, we imposed 12 upon them a fine of P500.00 each payable within ten days from receipt
of notice.
Still failing to receive any response from Garcia and Balla, we required13 ACC, on 2 October 2006, to
inform the Court of their current addresses.
In a Manifestation14 dated 18 January 2007, ACC stated that, as for Garcia, it has the same address as the
one being considered by the Court; and as to Balla, all pleadings and orders in the course of the
proceedings before the NLRC and the Court of Appeals were served to her through Garcia's address.
In a Resolution dated 28 February 2007, we noted ACC's Manifestation but considered its compliance
unsatisfactory. We required ACC to exert more effort in locating Garcia's present address and to inform
the Court thereof within ten days from notice.15
ACC through counsel failed to comply with our 28 February 2007 Resolution, thus, we required 16 its
counsel to show cause why it should not be held in contempt for fail ure to submit the addresses of
Garcia and Balla despite notice.
In a Compliance17 dated 5 December 2007, ACC through counsel apologized for its inadvertence and
asked for an extension within which to comply with the 28 February 2007 Resolution, which was
granted. 18
ACC's counsel would later inform us that various ways were employed to search for Garcia's address,
such as searches through the telephone directories, internet and personal inquiries, but to no avail.
Hence, ACC requested for another extension, 19 which was again granted.
In a Manifestation, dated 5 January 2007, ACC through counsel stated that it already made a personal
inquiry at Garcia's previous address, but still without success.
Thus, we resolved to dispense with Garcia and Balla's comment and submitted the case for decision
based on the pleadings filed.
Even without Garcia and Balla's comment, this Court denies ACC's Petition.
107
The issues for resolution are factual and Rule 45 of the Rules of Court provides that only questions of law
may be raised in a petition for review on certiorari. The raison d'etre is that the Court is not a trier of
facts. It is not to reexamine and reevaluate the evidence on record. Moreover, the factual findings of the
NLRC, as affirmed by the Court of Appeals, are accorded high respect and finality unless the factual
findings and conclusions of the Labor Arbiter clash with those of the NLRC and the Court of Appeals in
which case, the Court will have to review the records and the arguments of the parties to resolve the
factual issues and render substantial justice to the parties.20
In termination cases, the burden of proving just and valid cause for dismissing an employee from his
employment rests upon the employer, and the latter's failure to discharge that burden would result in a
finding that the dismissal is unjustified. 21
It must be stressed at the outset that ACC raised different grounds to justify its dismissal of Garcia and
Balla: before the Labor Arbiter, it cited retrenchment; before the NLRC, it claimed redundancy; and
before the Court of Appeals, it averred both retrenchment and redundancy.
It is apparent that ACC itself is confused as to the real reason why it terminated Garcia and Balla's
employment.
Both retrenchment and redundancy are authorized causes for the termination of employment. According
to Article 283 of the Labor Code:
ART. 283. Closure of establishment and reduction of personnel. – The employer may also terminate the
employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment
to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the
closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the
worker and the Department of Labor and Employment at least one (1) month before the intended date
thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker
affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at
least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent
losses and in cases of closures or cessation of operations of establishment or undertaking not due to
serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month pay
or at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least
six (6) months shall be considered one (1) whole year.
Although governed by the same provision of the Labor Code, retrenchment and redundancy are two
distinct grounds for termination arising from different circumstances, thus, they are in no way
interchangeable.
Redundancy exists when the service capability of the workforce is in excess of what is reasonably needed
to meet the demands of the business enterprise. A reasonably redundant position is one rendered
superfluous by any number of factors, such as overhiring of workers, decreased volume of business,
dropping of a particular product line previously manufactured by the company or phasing out of service
activity priorly undertaken by the business. Among the requisites of a valid redundancy program are: (1)
the good faith of the employer in abolishing the redundant position; and (2) fair and reasonable criteria
in ascertaining what positions are to be declared redundant and accordingly abolished. 22
The determination that the employee's services are no longer necessary or sustainable and, therefore,
properly terminable for being redundant is an exercise of business judgment of the employer. The
wisdom or soundness of this judgment is not subject to discretionary revie w of the Labor Arbiter and the

NLRC, provided there is no violation of law and no showing that it was prompted by an arbitrary or
malicious act. In other words, it is not enough for a company to merely declare that it has become
overmanned. It must produce adequate proof of such redundancy to justify the dismissal of the affected
employees. 23
In Panlilio v. National Labor Relations Commission, 24 it was held that the following evidence may be
proffered to substantiate redundancy: the new staffing pattern, feasibility studies/proposal on the
viability of the newly created positions, job description and the approval by the management of the
restructuring.
In the case at bar, ACC attempted to establish its streamlining program by presenting its new table of
organization. ACC also submitted a certification25 by its Human Resources Supervisor, Ma. Jazmin
Reginaldo, that the functions and duties of many rank and file employees, including the positions of
Garcia and Balla as Library Aide and Guidance Assistant, respectively, are now being performed by the
supervisory employees. These, however, do not satisfy the requirement of substantial evidence that a
reasonable mind might accept as adequate to support a conclusion.26 As they are, they are grossly
inadequate and mainly self-serving. More compelling evidence would have been a comparison of the old
and new staffing patterns, a description of the abolished and newly created positions, and proof of the
set business targets and failure to attain the same which necessitated the reorganization or streamlining.
To further justify its dismissal of Garcia and Balla, ACC presented several memoranda to prove that
Garcia and Balla had been remiss in the performance of their duties, as well as perennially tardy and
absent. Other than being self-serving, said memoranda are irrelevant to prove redundancy of the
positions held by Garcia and Balla. Redundancy arises because there is no more need for the employee's
position in relation to the whole business organization, and not because the employee unsatisfactorily
performed the duties and responsibilities required by his position. Redundancy is an authorized c ause for
termination of employment under Article 282 of the Labor Code; while serious misconduct or willful
disobedience or gross and habitual neglect of duties by the employee is a just cause for dismissal under
Article 283 of the Code.
The lingering doubt as to the existence of redundancy or of ACC's so called "streamlining program" is
highlighted even more by its non-presentation of the required notice27 to the Department of Labor and
Employment (DOLE) at least one month before the intended dismissal. 28 The notice to the DOLE would
have afforded the labor department the opportunity to look into and verify whether there is truth as to
ACC's claim that a decline in its student population resulted in excess manpower in the college.
Compliance with the required notices would have also established that ACC pursued its streamlining
program in good faith.
In balancing the interest between labor and capital, the prudent recourse in termination cases is to
safeguard the prized security of tenure of employees and to require employers to present the best
evidence obtainable, especially so because in most cases, the documents or proof needed to resolve the
validity of the termination, are in the possession of employers. A contrary ruling would encourage
employers to utilize redundancy as a means of dismissing employees when no valid grounds for
termination are shown by simply invoking a feigned or unsubstantiated redundancy program.
Granting that ACC was able to substantiate the need for streamlining its organization, it still failed to
implement the same using fair and reasonable criteria for choosing which employees to dismiss. Among
the accepted criteria in implementing a redundancy are: (a) less preferred status, e.g., temporary
employee; (b) efficiency; and (c) seniority. 29 There is no showing that ACC applied any of these criteria in
108
determining that, among its employees, Garcia and Balla should be dismissed, thus, making their
dismissal arbitrary and illegal.
Retrenchment, on the other hand, is the termination of employment effected by management during
periods of business recession, industrial depression, seasonal fluctuations, lack of work or considerable
reduction in the volume of the employer's business. 30 Resorted to by an employer to avoid or minimize
business losses, 31 it is a management prerogative consistently recognized by this Court. 32
There are three basic requisites for a valid retrenchment to exist, to wit: (a) the retrenchment is
necessary to prevent losses and such losses are proven; (b) written notice to the employees and to the
DOLE at least one (1) month prior to the intended date of retrenchment; and (c) payment of separation
pay equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service,
whichever is higher. 33
To justify retrenchment, the employer must prove serious business losses. 34 Indeed, not all business
losses suffered by the employer would justify retrenchment under Article 283 of the Labor Code. 35 The
"loss" referred to in Article 283 cannot be just any kind or amount of loss; otherwise, a company could
easily feign excuses to suit its whims and prejudices or to rid itself of unwanted employees. 36
In a number of cases, the Court has identified the necessary conditions for the company losses to justify
retrenchment: (1) the losses incurred are substantial and not de minimis; (2) the losses are actual or
reasonably imminent; (3) the retrenchment is reasonably necessary and is likely to be effective in
preventing the expected losses; and (d) the alleged losses, if a lready incurred, or the expected imminent
losses sought to be forestalled, are proven by sufficient and convincing evidence. 37 ACC miserably failed
to prove any of the foregoing.
In the case at bar, ACC claimed that the retrenchment of Garcia and Balla was justified due to the
financial difficulties experienced by the college that it was made effective in all of its campuses and for all
departments; and appropriate notices were given to Garcia and Balla. But other than its bare allegations,
ACC failed to present any supporting evidence.
Not only was ACC unable to prove its losses, it also failed to present proof that it served the necessary
notice to the DOLE one month before the purported retrenchment of Garcia and Balla. 38 As also found by
the Labor Arbiter, and affirmed by the NLRC and the Court of Appeals, ACC did not give Garcia and Balla
sufficient separation pay. Falling short of all the requirements, ACC cannot claim that it had effected a
valid retrenchment of Garcia and Balla.
In sum, the Court finds no basis for disturbing the consistent findings of the Labor Arbiter, the NLRC and
the Court of Appeals that ACC was not able to discharge the burden of proving that its dismissal of Garcia
and Balla was valid.
Finally, ACC argues that the Court of Appeals should not have limited its power of review to the finding of
grave abuse of discretion allegedly committed by the NLRC, but should have considered the substantial
evidence adduced by ACC.
The contention is without merit.
The extent of judicial review by certiorari of decisions or resolutions of the NLRC, as exercised previously
by the Supreme Court and now by the Court of Appeals, is described in Zarate, Jr. v. Olegario,39 thus –
 109

The rule is settled that the original and exclusive jurisdiction of this Court to review a decision of
respondent NLRC (or Executive Labor Arbiter as in this case) in a petition for certiorari under Rule
65 does not normally include an inquiry into the correctness of its evaluation of the evidence. Errors of
judgment, as distinguished from errors of jurisdiction, are not within the province of a special civil
action for certiorari, which is merely confined to issues of jurisdiction or grave abuse of discretion.It is
thus incumbent upon petitioner to satisfactorily establish that respondent Commission or executive
labor arbiter acted capriciously and whimsically in total disregard of evidence material to or even
decisive of the controversy, in order that the extraordinary writ of certiorari will lie. By grave abuse of
discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of
jurisdiction, and it must be shown that the discretion was exercised arbitrarily or despotically.
For certiorari to lie, there must be capricious, arbitrary and whimsical exercise of power, the very
antithesis of the judicial prerogative in accordance with centuries of both civil law and common l aw
traditions. (Underscoring supplied.)
None of the foregoing circumstances exists in this case that would justify the Court of Appeals, in a
petition forcertiorari, to look into and re-weigh the evidence on record to determine whether the NLRC
committed errors of judgment as regards thereto. Absent exceptional circumstances, the general rule
applies and the Court of Appeals is limited only to ascertaining whether the NLRC acted capriciously and
whimsically in total disregard of evidence material to or decisive of the controversy so as to oust the
latter of jurisdiction.
WHEREFORE, the instant Petition is hereby DENIED. The Decision dated 30 August 2004 of the Court of
Appeals in CA-G.R. SP No. 81808 is hereby AFFIRMED. Costs against petitioner.
SO ORDERED.

The Court of Appeals, therefore, can grant the petition for certiorari if it finds that the NLRC, in its
assailed decision or resolution, committed grave abuse of discretion by capriciously, whimsically, or
arbitrarily disregarding evidence which is material or decisive of the controversy.

In Garcia v. National Labor Relations Commission,40 we further defined the scope of the Court of Appeals'
power to review the evidence when the decision of the NLRC is brought before it via a petition
for certiorari –

[I]n Ong v. People, we ruled that certiorari can be properly resorted to where the factual findings
complained of are not supported by the evidence on record. Earlier, in Gutib v. Court of Appeals, we
emphasized thus:

[I]t has been said that a wide breadth of discretion is granted a court of justice in certiorari proceedings.
The cases in which certiorari will issue cannot be defined, because to do so would be to destroy its
comprehensiveness and usefulness. So wide is the discretion of the court that authority is not wanting to
show that certiorari is more discretionary than either prohibition or mandamus. In the exercise of our
superintending control over inferior courts, we are to be guided by all the circumstances of each
particular case "as the ends of justice may require." So it is that the writ will be granted where
necessary to prevent a substantial wrong or to do substantial justice.

And in another case of recent vintage, we further held:

In the review of an NLRC decision through a special civil action for certiorari, resolution is confined only
to issues of jurisdiction and grave abuse of discretion on the part of the labor tribunal. Hence, the Court
refrains from reviewing factual assessments of lower courts and agencies exercising adjudicative
functions, such as the NLRC. Occasionally, however, the Court is constrained to delve into factual matters
where, as in the instant case, the findings of the NLRC contradict those of the Labor Arbiter.

In this instance, the Court in the exercise of its equity jurisdiction may look into the records of the case
and re-examine the questioned findings. As a corollary, this Court is clothed with ample authority to
review matters, even if they are not assigned as errors in their appeal, if it finds that their consideration
is necessary to arrive at a just decision of the case. The same principles are now necessarily adhered to
and are applied by the Court of Appeals in its expanded jurisdiction over labor cases elevated through a
petition for certiorari; thus, we see no error on its part when it made anew a factual determination of
the matters and on that basis reversed the ruling of the NLRC. (Underscoring supplied.)

[G.R. No. 123639. June 10, 1997]
ANTONIO M. GARCIA, petitioner, vs. COURT OF APPEALS and PHILIPPINE EXPORT & FOREIGN LOAN
GUARANTEE CORPORATION, respondents.
D E C I S I ON
KAPUNAN, J.:
Petitioner Antonio Garcia challenges, through this petition for review on certiorari under Rule 45 of the
Revised Rules of Court, the decision of the Court of Appeals promulgated on 23 October 1995 in CA-G.R.
SP No. 27994 granting the motion to dismiss filed by private respondent Philippine Export & ForeignLoan
Guarantee Corporation (Philguarantee) on grounds of lack of jurisdiction. Similarly impugned is the Court
of Appeals resolution dated 31January 1996 denying petitioners motion for reconsideration.
Petitioner was a major stockholder and president of Dynetics, Inc., a corporation primarily engaged in
the manufacture of semi-conductors) originally owning 43% of its outstanding shares of stock. In 1981,
Asia Reliability Co., Inc. (ARCI) obtained 28.98% interest in Dynetics. With the said acquisition, the
ownership structure of Dynetics became: petitioner Garcia - 32.88%; ARCI - 28.78%; Vicente Chuidian
(petitioners business partner and a major stockholder of ARCI) - 26%; and others - 11.26%.[1]
In February 1981, ARCI, through the initiative of Chuidian and with the guarantee of private respondent,
acquired a foreign loan in the amount of US$25,000,000.00 ostensibly to finance its various business
projects. However, the proceeds of the said loan were illegally diverted and used for unauthorized
purposes.
When ARCI defaulted in the payment of the aforestated loan, the foreign creditors went after the
guarantor herein private respondent. In turn, private respondent filed cases for recovery against
Chuidian, both here and in the United States (where Chuidian fled).
Unfortunately, Dynetics was caught in the crossfire and became a battlefield for control between
Chuidian (who also owns, as previously stated, a substantial interest in Dynetics) and private respondent
Philguarantee. [2]
In February 1985, Chuidian, as President of Interlek (the marketing arm of Dynetics, organized and based
in California, USA) ordered the company to stop its remittances to Dynetics for the latters assembly
services which as of June 1985 amounted to approximately US$5,000,000.00. Consequently, Dynetics
filed a collection case against Interlek and Chuidian.
Thereafter, four (4) representatives of Philguarantee were assigned one (1) qualifying share each in
Dynetics. Thus, on 27 May 1985 during the stockholders meeting of Dynetics, the aforementioned
nominees (Victor Macalindog, Cesar Macuja, Eduardo Morato and Manuel Lazaro) were elected
members of the Board of Directors of Dynetics (although Lazaro did not assume office). Petitioner was
the fifth member of the Board.
On 27 November 1985, a Settlement and Mutual Release Agreement (SMRA) was executed by and
between Dynetics and Chuidian and another between Philguarantee and Chuidian for the purpose of
finally putting an end to the numerous cases filed by the aforestated parties against one another.The
agreements, provided the following:
110
(1) dismissal with prejudice of all cases pending between the parties here and abroad, except as to claims
against ARCI and Interlek with respect to which the dismissals in the aforementioned actions shall be
without prejudice;
(2) the assignment to Defendant Philguarantee of all shares of stocks owned and controlled by Chuidian
in Interlek;
(3) the assignment to Philguarantee to all shares of Chuidian in ARCI and in Dynetics;
(4) the payment by Dynetics of US$100,000.00 per month to Chuidian for five years, backed by a Letter
of Credit; and
(5) the assumption by Dynetics of all the obligations of ARCI in favor of Defendant Philguarantee in the
aggregate sum of approximately US$47 Million. [3]
On 12 December 1991, petitioner instituted a complaint for damages before the Regional Trial Court of
Makati, Branch 58. On his first cause of action, petitioner alleged that private respondent reneged on its
commitment, based on the aforecited SMRA, to rehabilitate Dynetics and Chemark (a subsidiary wholly
owned by Dynetics) and this caused the financial ruin of the two corporations. Dynetics and Chemark
consequently defaulted on their financial obligations and petitioner, in his capacity as guarantor, was
held personally liable. He was forced to compromise with the creditor banks in the total amount
of P145,000.000.00. [4]
On his second cause of action, petitioner contended that as a result, likewise, of private respondents
failure to rehabilitate Dynetics and because of theimplementation of the onerous SMRA with Chuidian,
the book value of his shares in Dynetics plummeted, from P200.00 per share, to practically zero.
On his third cause of action, petitioner alleged that Dynetics incurred severe losses due to the provision
in the SMRA directing the said corporation to drop the collection case it filed against Interlek and
Chuidian for unpaid remittances.
Petitioner thus prayed that private respondent pay the following:
1. On his First Cause of Action, P145,000,000.00 as actual/compensatory damages under the terms and
conditions of said compromise agreements mentioned in plaintiffs First Cause of Action dated January
17, 1989;
2. On his Second Cause of Action, P32,000,000.00 representing actual losses of the book value of
plaintiffs 159,997 shares of stock of Dynetics, Inc. from P200.00 per share to zero amount per share;
3. On his Third Cause of Action, P3,200,000.00 representing losses of plaintiffs equity in unrealized profit
out of said unremitted US$5,000,000.00 due from Interlek;
4. On this Fourth Cause of Action, P15,000,000.00 as moral damages and P10,000,000.00 as exemplary
damages.
5. On his Fifth Cause of Action, P30,000,000.00 for and as attorneys fee (15% of the amount involved). [5]
On 20 February 1992, private respondent filed a motion to dismiss on grounds of lack of jurisdiction over
the subject matter.

On 21 May 1992, the Regional Trial Court of Makati issued an order denying private respondents motion
to dismiss. The order reads thus:
O RDE R
The decision promulgated on May 6, 1992 by the Hon. Court of Appeals in CA-G.R. SP. No. 27685 entitled
Phil. Export and Foreign Loan Guarantee Corporation vs. Hon. Presiding Judge, Br. 58, RTC, Makati
directing this Court to resolve said petitioners motion to dismiss, a copy of said decision having been
furnished this Court, is NOTED.
Pending resolution before this Court is the motion to dismiss filed by defendant Philguarantee, the
opposition thereto filed by the plaintiff, and the reply to opposition file d by the said defendant. After
considering the arguments for and against the motion, the Court resolves to deny the
motion. Furthermore, after a meticulous assessment of the record of this case, the Court is more inclined
to believe that the nature of this case is for damages rather than an intra-corporate matter and therefore
this Court has jurisdiction over this case. Due to the denial of defendants motion to dismiss as
aforementioned, the said defendant is given fifteen (15) days from receipt of a copy of this order within
which to file its answer pursuant to Sec. 4, Rule 16 of the Rules of Court.
Notify the respective counsel of both parties of this order.
SO ORDERED.[6]
Private respondent challenged the trial courts order before the Court of Appeals which, in a decision
dated 23 October 1995, reversed the same. The dispositive portion states thus:
WHEREFORE, in view of the foregoing, the instant petition is hereby GRANTED. The assailed order of
respondent court dated May 21, 1992 is SET ASIDE.
SO ORDERED.[7]
The Court of Appeals ruled that the controversy between petitioner and private respondent is intra-
corporate in nature and therefore falls under the jurisdiction of the Securities and Exchange Commission
(SEC) and not the regular courts.
In a resolution dated 20 December 1995, the Court of Appeals denied petitioners motion for
reconsideration. [8] Hence, this petition for review oncertiorari.
Petitioner assigns the following errors:
I expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear
RESPONDENT COURT OF APPEALS ERRED IN NOT FINDING THAT PETITIONERS ACTION BEFORE THE
COURT A QUO IS PURELY OF DAMAGES ARISING OUT OF BREACH OF CONTRACT AND THEREFORE
WITHIN THE EXCLUSIVE JURISDICTION OF REGULAR CIVIL COURTS.
II
RESPONDENT COURT OF APPEALS ERRED IN NOT FINDING THAT THE INSTANT ACTION DOES NOT
INVOLVE INTRA-CORPORATE MATTERS OR ISSUES AND THEREFORE BEYOND THE JURISDICTION OF THE
SECURITIES AND EXCHANGE COMMISSION. [9]
111
In insisting that the SEC does not have jurisdiction, petitioner recounts the events in this manner: before
private respondent entered the picture, Chemark, a Dynetics subsidiary, obtained loans from PCIB, BPI,
RCBC, PISO, LB and other banks on various dates. These loans were personally guaranteed by petitioner
under suretyship agreements he executed in favor of the said banks in 1980. After private respondent
gained control of Dynetics, it made a firm commitment, petitioner claims, to rehabilitate Dynetics and
Chemark in exchange for his acquiescence to the SMRA even though its terms were prejudicial to
Dynetics. However, private respondent reneged on its promise, which caused Dynetics and Chemark to
collapse financially. Being the corporations guarantor, petitioner was forced to settle their debts with the
aforementioned banks with his personal properties. Hence, petitioner contends that what he sought to
recover in his complaint for damages was primarily the money he paid to the creditor banks of Dynetics
and Chemark.
Petitioner thus persists in his argument that, being an action for damages due to breach of contract, the
present case is cognizable by the regular courts and beyond the jurisdiction of the SEC, for, had private
respondent not withdrawn its commitment, petitioner rationalizes, Dynetics would have regained its
strong business position. Consequently, it could have settled its obligations with its creditor banks and
petitioner would have been released from his obligations as surety. [10]
Petitioner further contends that he is suing not as a stockholder of Dynetics but in his personal capacity
as the latters aggrieved surety. In like manner, private respondent is being sued as a separate entity
which authored the notorious SMRA. [11]
Petitioner also avers that his principal cause of action is damages arising from breach of contract. The
other causes of action in his complaint are incidental claims which emanate from and are the direct
consequences of his main cause of action. [12]
The petition is unmeritorious. Jurisdiction over the present controversy is vested in the SEC and not in
the regular courts.
To determine which body has jurisdiction over the present controversy, we rely on the sound judicial
principle that jurisdiction over the subject matter of a case is conferred by law and is determined by the
allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of the claims
asserted therein. [13]
The law, P.D. 902-A, explicitly lays down the parameters of the Securities and Exchange
Commissions jurisdiction. Thus:
SECTION 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange
Commission over corporations, partnerships and other forms of associations registered with it as
and decide cases involving:
a) Devices or schemes employed by or any acts of the board of directors, business associates, its officers
or partners, amounting to fraud and misrepresentation which may be detrimental to the interest of the
public and/or of the stockholders, partners, members of associations or organizations registered withthe
Commission.
b) Controversies arising out of intra-corporate or partnership relations, between and among
stockholders, members, or associates; between any and/or all of them and the corporation, partnership
or association of which they are stockholders, members or associates, respectively; and between such

corporation, partnership or association and the State insofar as it concerns their individual franchise or
right to exist as such entity.
c) Controversies in the election or appointments of directors, trustees, officers or managers of such
corporations, partnerships, or associations.
d) Petitions of corporations, partnerships or associations to be declared in the state of suspension of
payments in cases where the corporation, partnership or association possesses sufficient property to
cover all of its debts but foresees the impossibility of meeting them when they respectively fall due or in
cases where the corporation, partnership or association has no sufficient assets to cover its liabilities but
is under the Management Committee created pursuant to this Decree.
Jurisprudence, however, has tempered the aforequoted provision, paragraph (b) in particular:
x x x. The better policy in determining which body has jurisdiction over a case would be to consider not
only the status or relationship of the parties but also the nature of the question that is the subject of
their controversy.[14]
We have judiciously gone over petitioners original complaint and are not deceived by his cunning
arguments. The case at bar is a classic illustration of a dispute between stockholders - - private
respondent, the current majority and controlling stockholder of Dynetics and petitioner, the erstwhile
majority stockholder of said corporation (although he still holds a substantial interest therein).
Petitioners stubborn insistence that he brought the case for damages in his capacity as an aggrieved
surety and not as a stockholder is belied by the opening statement in his complaint:
1. Plaintiff is a Filipino, of legal age, with business address at 7th Floor, Chemphil Building, Pasay Road,
Makati, Metro Manila, where he may be served with all court processes; he was (and still is) at all times
relevent to his complaint a major stockholder of Dynetics, Inc. (Dynetics for brevity), a corporation duly
organized and existing under the laws of the Philippines; [15] x x x (underscoring ours).
Moreover, in the same complaint petitioner also sought to recover the loss in the book value of his
shares of stock in Dynetics and his share in the said corporations unrealized profits. Although the
foregoing may have arisen from the same facts or circumstances, we cannot simply brush these aside as
incidental claims because only in his personality as a prejudiced stockholder, and not in his capacity as a
mere surety, will petitioner be able to rightly pray for and be granted these claims.
More importantly, petitioner became a surety of Dynetics and Chemark because he was then one of the
principal stockholders of Dynetics. This was a requisite of the creditor banks. Petitioners character as
surety for Dynetics, therefore, can even be traced to and is interlocked with the fact that he is a major
stockholder of the said corporation. Petitioner himself revealed in his complaint:
21. On the other hand, at various times before the aforesaid controversy between the Marcoses and
Chuidian, Chemark, a subsidiary of Dynetics, obtained various loans from PCIB, IBAA, SBTC and a
consortium of banks (PISO, BPI, RCBC, PCIB, and LB) the security for which loans were required by said
creditor banks to include guarantee and/or suretyships coming from the principal stockholders of
Dynetics and Chemark including plaintiff who had to execute such guarantees and/or suretyships in his
personal capacity under a joint and several or solidary type of obligation. [16] (underscoring ours).
It is evident from the aforequoted averment that petitioner instituted his complaint primarily as
stockholder of Dynetics. Petitioner however, wants us to focus solely on his character as surety and his
112
claim for damages as such to remove the present controversy from Section 5(b) of P.D. 902-A, and
corollarily from the jurisdiction of the SEC.
Petitioner, likewise, assails the status of private respondent as stockholder of Dynetics. His contention,
however, is belied by the allegations in his complaint. As early as 27 May 1985 Philguarantees
representatives were already on the Board of Directors of Dynetics, constituting the majority thereof. In
his complaint, petitioner himself stated, that:
9. At the start of the second quarter of 1985, the defendant, acting apparently upon the instructions of
the Marcoses, without assuming formal ownership of the company and employing undue power and
influence started to gain control of Dynetics. No major decision or fund disbursement was made without
the defendants consent. On May 27, 1985, during a stockholders meeting convened at its proddings, the
defendant had its nominees, namely, Victor Macalincag, Cesar Macuja and Eduardo Morato (of HSDC)
elected and constituted as a majority in the board of Dynetics. Out of five members, only four assumed
office. The fourth member was plaintiff. The fifty member, Manuel Lazaro, then the Presidents Legal
Counsel, was nominated and elected but did not assume office. Chuidian was ousted as a director
although he still had sufficient shares in his name and control to elect himself. [17] (underscoring ours).
Since both parties in the case at bar are stockholders of the corporation, jurisdiction over their present
conflict vests in the SEC pursuant to Sec. 5(b) of P.D. 902-A. Our task, however, does not end here. As
stated in Viray v. CA,[18] the establishment of any of the relationships in Sec. 5(b) of PD 902-A does not
automatically confer jurisdiction over the dispute on the SEC to the exclusion of the regular courts. We
are quite aware that not all disagreements between stockholders or between a corporation and its
stockholder are intra-corporate in nature. Hence, we proceed to the next test: whether or not the nature
of the controversy itself is intra-corporate.
Contrary to petitioners averments, this is not a simple action for breach of contract. Digging deeper, the
corporate nature of the present controversy is eventually revealed.
Petitioner attributes to the SMRA the commitment of private respondent to rehabilitate Dynetics and
Chemark. This is the reason why, when private respondent withdrew the restructuring plans for the
rehabilitation of the aforementioned corporations, petitioner instituted a complaint for breach of
contract.The problem with this scenario, however, is that petitioner failed to indicate the exact provision
where this specific promise is embodied. Instead, petitioner presented the letter dated 18 October 1985
sent by Cesar P. Macuja, Chairman of the Board of Directors of Dynetics and Executive Vice-President of
private respondent to all the creditor banks of Dynetics and Chemark entitled Proposed
Integrated Financial Plan for the Rehabilitation of Dynetics, Inc.,Asian Reliability Company, Inc. and
Chemark Electric Motors, Inc. The contents of the said letter is hereby reproduced:
In accordance with our discussion meetings of 9-11 October 1985, I am submitting to each one of you for
review and favorable consideration, the Proposed Integrated Financial Plan for the rehabilitation of the
above-mentioned companies.
As reported to you, PHILGUARANTEE has been ceded ownership of these companies and the success of
our rehabilitation of the business will depend largely on your approval to restructure your respective
exposures in Dynetics and Chemark. The basic restructuring scheme is summarized as follows:
1. For the Secured Creditors of Dynetics. - Unpaid interest up to 31 December 1985 will be capitalized as
principal. The consolidated principal amount (original principal balance plus capitalized interest) will be

repaid within four (4) years at an interest rate of 14% per annum with a one (1) year grace period on
principal repayment. These loans will remain as dollar-denominated liabilities.
2. For the Unsecured Creditors of Dynetics - Unpaid interest up to 31 December 1985 will be capitalized
as principal. The consolidated principal amount (original principal balance plus capitalized interest) will
be repaid within seven (7) years at an interest rate of 1-1/2% over Treasury Bills with two (2) years grace
period on principal repayment.
3. For the Chemarks Creditors - Unpaid interest up to 31 December 1985 will be capitalized as
principal. The consolidated principal amount (original principal balance plus capitalized interest) will be
repaid within fifteen (15) years with two (2) years grace period on principal repayment at an interest rate
of 10% per annum.
4. New Equity Contribution - Since PHIL- GUARANTEE is a government financial institution and not a
venture capital company, it is proposed that an Investors Group be invited to invest new money of
about P44.0 million.
COMMERCIAL PLAN
The financial projections are prepared on the basis of three (3) divisional commercial plans as follows:
a. Semiconductor - There will be a continuance of the operations of Dynetics, Inc. as a semi conductor
assembly division with gradual buildup of supply orders from its 40 major customers with profitable
market recovery during 1986.
b. PHILGUARANTEEs acquired assets from ARCI shall be integrated into the operation of Dynetics as
Integrated Circuits Testing/Tool and Die Fabrication Divisions.
c. Restart the operation of Chemark under the financial assistance from Dynetics in accordance with new
business opportunities as reflected by letters of intent.
EXPANDED BOARD OF DIRECTORS
It is planned that the consolidated operation will have a simple Board of Directors to be expanded from
the present five (5) members to nine (9) members. The four (4) new Board representatives are proposed
to be nominated from among the creditor banks.
You will also note that one of the highlights of the projections, aside from the assumed restructuring
terms, is a conservative estimate of Dynetics overall working capital requirements, of P89.0 Million. This
estimate already took into account Dynetics financial assistance contemplated for Chemark for
about P35.2 million. In this regard, Dynetics management had earlier proposed to source this
requirement through short-term borrowings. It is nonetheless the opinion of PHILGUARANTEE that the
right funding mix is a combination of short-term borrowings of P45.0 million and fresh equity infusion of
the P44.0 million to be supplied by a proposed Investors Group. PHILGUARANTEE is pursuing this funding
mix so as not to overburden Dynetics in terms of financing cost.
The Integrated Financial Plan amply illustrates the business potential of this group of companies. May I
therefore reiterate that your decision to go with this plan will benefit not just the thousands of people
depending on these companies for livelihood. In more ways than one, your concerted efforts will go a
long way towards achieving the desired stability of the export electronic industry in the Philippines, and
should ultimately redound to the benefit of the private sectors like you.
113
Thank you and regards.
CESAR P. MACUJA
Chairman of the Board Executive Vice President
Dynetics, Incorporated Phil. Export & Foreign
Loan Guarantee Corp.
cc: Philguarantee Board of Directors. [19]
The aforequoted letter, to use a worn cliche, reveals beyond the shadow of a doubt that the proposed
rehabilitation program for the said corporation was made by private respondent in its capacity as the
majority or controlling stockholder of Dynetics. The rehabilitation plan was a corporate decision and a
corporate action. The root of petitioners complaint therefore, no matter how cleverly devised and
artfully disguised is plainly a corporate affair and being so, jurisdiction over the dispute at bar pertains to
the SEC and not to the regular courts.
We concur with the findings of the Court of Appeals, thus:
The private respondent, however, vigorously asserts that his case is nothing but an action for damages
arising from breach of contractual obligation committed by petitioner in unilaterally withdrawing its
agreement to rehabilitate Dynetics and Chemark. The contention is clever, but unacceptable. The fact
remains that the claim for damages either depends on, or is inextricably linked with, the resolution of the
corporate controversies. For instance, the prayer for moral and exemplary damages is grounded on
defendants total bad faith and malice knowing fully well that its acts were patently injurious to the rights
and interests of said corporations and its stockholders, including plaintiff xxx. xxx. Clearly, what private
respondent filed against petitioner before the court below was an intra-corporate case under the guise
of an action for damages employing civil law terms and phrases.
The teaching of the Court, en banc, penned by Justice Bellosillo, in the recent case of Andaya vs. Abadia,
et al., 228 SCRA 707, 711, further illumines the issue:
The allegations against herein respondents in the amended complaint unquestionably reveal intra-
corporate controversies cleverly concealed, although unsuccessfully, by use of civil law terms and
phrases, xxx While it may be said that the same corporate acts also give rise to civil liability for damages,
it does not follow that the case is necessarily taken out of the jurisdiction of the SEC as it may award
damages which can be considered consequential in the exercise of its adjudicative powers. Besides,
incidental issues that properly fall within the authority of a tribunal may also be considered by it to avoid
multiplicity of actions. Consequently, in intra-corporate matters such as those affecting the corporation,
the issue of consequential damages may just as well be resolved and adjudicated by the SEC.
(underscoring supplied).[20]
In view of the foregoing, the declaration in Union Glass and Container Corp. vs. SEC. [21] is appropriately
recalled:
.x x x. The principal function of the SEC is the supervision and control over corporations, partnerships and
associations with the end in view that investment in these entities may be encouraged and protected
and their activities pursued for the promotion of economic development.
 114

It is in aid of this office that the adjudicative power of the SEC must be exercised. Thus the law explicitly
specified and delimited its jurisdiction to matters intrinsically connnected with the regulation of
corporations, partnerships and associations and those dealing with the internal affairs of such
corporations, partnerships or associations. (underscoring ours).

WHEREFORE, premises considered, the petition for review on certiorari is hereby DENIED.

SO ORDERED.

G.R. No. L-26933 October 18, 1977
CESAR JAYME AND CONCHITA JAYME, petitioners,
vs.
JUDGE SEVERIANO DE LEON, REYNOLD S. FAJARDO, FLAVIANO ALENTORIO, PEDRO ALLIEZA, ERNESTO
CANDIDO, ROMEO CANDIDO, FRANCISCO CRISOSTOMO, JESUS CRISOSTOMO, JESUS CAONTOY
PROFIRIO DOLLAR, MELCHOR PALERMO, FLOR DELGADO, FERNANDO TAGACAY and COMMERCIAL &
AGROINDUSTRIAL LABOR ORGANIZATION CAILO, respondents.
Enrique Debuque, Jorge Debuque, Emilio de la Cruz and Francisco Garganera for petitioners.
Estrelia T. Estrada for respondent Judge.
Bernardo B. Pablo for private respondents.
SANTOS, J.:têñ.£îhqwâ£
In this petition for certiorari and prohibition with prayer for preliminary injunction filed on December 5.
1966, petitioners seek to annul the proceedings of the court of Agrarian Relations (CAR) in CAR Case No.
L- 229, Negros Occidental entitled "Flaviano Alentorio et al. versus Dr. Cesar Jayme, et al." and to restrain
respondent Judge from taking further action the same. On December 12, 1966, the petition was given
due course and respondents were required to file an answer, not a motion to dismiss. Upon the filling
and approval of a bond in the amount of One Thousand Pesos (PI,000.00), the lower Court was
restrained from further proceedings on January 3, 1967.1
The factual antecedents of this petition are as follow: On April 8, 1965. a complaint for unfair labor
practice was filed with the Court of Agrarian Relations (CAR) of Bacolod City, by Reynold S. Fajardo, an
attorney of the Court of Agrarian Relations, Quezon City, after conducting a priliminary investigation of
the unfair labor practice charged filed by private respondents. The complaint was docketed as CAR law
No. L-229-Neg. Occ., and, correspondingly,summons was issued and duly served upon the petitioners
herein. 2
A motion to dismiss dated October 18, 1966, ordered by petitioners, as defendants below, was denied by
respondent Judge an Order dated Oct. 22, 1966. 3 Their Motion for reconsiders of the denial was also
denied by respondent Judge in an Order dated November 9, 1966. 4 Hence, this petition.
Petitioners, in asserting 'that respondent, Judge Severiano de Leon, has acted without and/or excess of
his jurisdiction denying petitioners' motion to dismiss, relies on the allegations — ñé+.£ªwph!1
10. That the above mentioned case for unfair labor practices outside thejurisdiction of the respondent
Judge the same being of violation 155, Republic Act No, 3844 otherwise known as the Land Reform Code
and Republic Act No. 2367 which specifically prescribes the Rules of Procedures of the Court of Agrarian
Relations to Section 10 of Republic Act 1267and the Revised Rules of the Court
11. That the Court of Agrarian Relations has no jurisdiction to hear cases the complaint of which is fatally
defective for want signatures of the proper party in interest in violation of the Rules of Court, Republic
Act 1267 and Republic Act 3844;
115
12. That the respondent Judge has likewise no jurisdiction entertaining cases where moral and/or
exemplary damages are asked for, these matters failing exclusively within the jurisdiction of the ordinary
court of justice;
13. That the Honorable Judge cannot entertain matten where differential pay is alleged in the
complaint filed in behalf of the other respondent, Flaviano Alentorio et at., and the same suffers from
defect for alleging therein attorney's fees as asked by the Honorable Investigator Reynold S. Fajardo in
behalf of Atty. Bernardo Pablo counsel for the respondent. (Emphasis supplied.)
Apropos the foregoing, We note petitioners' statement in the "Motion for Reconsideration" to the
effect: ñé+.£ªwph!1
6. That it escapes our logic how Section 2 (4) which is only a declaration of policy, Sections 40, 41, 47 and
154, of Republic Act 3844, which provisions all refer to unfair labor practices for agrarian workers, are
made applicable to the question of the procedure in the implementation of these substantive rights. No
one disputes any substantive right under Republic Act 3844 or existing laws thereto Rather, it is the
manner of enforcing these tights without doing violence to the applicable laws and the constitution
governing the matter which the defendants are seeking reverently.8 (Italics supplied)
The by way of and "as the grounds upon which the Petitioner rely ..." they cite - ñé+.£ªwph!1
(a) The Land Reform Code (RA 3844), RA 1267, creating and establishing the jurisdiction of the Court of
Agrarian Relations, nor the Revised Rules of Court does not vest the Court of Agrarian Relations, with the
power to conduct preliminary investigation much less grant the Honorable Investigator Reynold S.
Fajardo the power to sign complaints for and in behalf of the real party in interest and that Section 155 of
the Land Reform Code specifically so provides that the Revised Rules of Court should govern procedures
in the Court of Agrarian Relations;
(b) The power to award moral damages falls within the original and exclusive jurisdiction of the ordinary
courts of Justice the same being beyond pecuniary estimation and hence the Judiciary Act of 1949, See.
44(c), defining the original and exclusive jurisdiction of the Court of First Instance, remove the award of
moral damages from any other body except the Court of First Instance;
(c) The power to award exemplary damages is likewise vested with the ordinary courts of justice;
(d) In line with the case of Valleson Inc. versus Tiburcio, G.R. No. L- 18185, September 27, 1962, the
Court of Agrarian Relations has no power to decide differential pay;
(e) That it is not for the Honorable Investigator to decide the amount of attorney's fees but the real party
in interest. 9 (Italics supplied).
A careful consideration of the foregoing pleadings shows that while at first blush petitioners' counsel
seem to assert that the CAR has no jurisdiction to try unfair labor practice cases involving private workers
- as asserted in paragraph 10 quoted above petitioners in reality do not dispute the authority and/or
jurisdiction of respondent Judge to try and decide the merits of the unfair labor practice charge or
complaint involving private respondents who are agricultural workers - as copied in pars. 6 and (a) also
above quoted. For while petitioners, thru counsel assert that this ". . . case for unfair labor practice
is outside the jurisdiction of response Judge ... " citing Section 155 of Republic Act No. 3844 or the
Agricultural Land Reform Code and Republic Act No. 1267, Charter of the Court of Agrarian Relations,it is
obvious that what they question is "... the manner of enforcing these rights ... because "... The Land
Reform Code (Republic Act 3844) Republic Act 1267 creating and establishing the juris diction of the

Court Agrarian Relations, nor the Revised Rules of Court does not vest the Court of Agrarian Relations
with the power to preliminary investigation much less grant the Honorable Investigator Reynold S.
Fajardo, the power to sign complaints and in behalf of the real party in interest ...". The real question
presented to Us, therefore, in respect to the unfair labor practice cause is - (1) Did respondent Judge, in
designating an investigate Atty. Reynold S. Fajardo, to look into the merits of the unfair labor Practice
charge filed by private respondents, and in giving due course to the unfair labor practice complaint
signed and filed by the said Court investigator, act without and/or in excess of jurisdiction on Petitioners,
additionally, also contend that - (2) the Court of Agrarian Relations does not have jurisdiction to the
cognizance of claims for moral and exemplary damages and differential pay - as alleged in Paragraphs 11,
12, and 13 and (b), (c) and (d) also quoted above.
1. Now to resolve the first question. There can be no issue with respect to the jurisdiction of respondent
Judge over the unfair labor Practice case filed by private respondents as agricultural workers at the time
the complaint for unfair labor Practice was filed on April 8, 1965 in the Court below. For it is a settled
doctrine that cases involving agricultural workers, including unfair labor practice cases, were within the
original and exclusive junction of the CAR upon the approval of Republic Act 1267 on June 14, 1955. This
has been the consistent holding of this Court in at least three cases, the latest of which was decided on
March 30, 1963. ñé+.£ªwph!1
Jurisdiction: Unfair labor Practice: Jurisdiction of Court of Agrarian Relations if agricultural laborers are
involved, - Laborers whose principal work in an hacienda consists in the planting and harvesting of sugar
canes and other Chores incidental to ordinary farming operations are agricultural laborers, and any
unfair labor practice case involving them comes within the jurisdiction of the court of Agrarian Relations,
not the Court of Industrial Relations.10 Section 8 of Republic Act 2263, which amended Section 27 of
Republic Act 1199, otherwise known as Agricutural Tenancy Act of the Philippines, made this
jurisdictional competence of CAR over unfair labor practice cases clearer with the provision that -
(5) The landholder shall not discourage, directly or indirectly, the formation, maintenance or growth of a
union or organization of tenants in his landholding, but he shall not initiate, dominate, assist or interfere
in the formation or administration of any such union or organization."
Finally, Republic Act 3844, the Agricultural Land Reform Code of 1963, under the regime of which the
cause of action of private respondents herein accrued, expressly and specifically vests in the CAR the
jurisdiction to hear and decide unfair labor practice (ULP) cases. 11
On the procedural aspect of unfair labor practice cases before the CAR, which is our main concern here,
this Court in Matillano vs. De Leon 12 and Philippine Packing Corporation vs. Reyes 13 said:
The procedure applicable to cases involving agricultural laborers prior to the creation of the Court of
Agrarian Relations was the Rules of the Court of Industrial Relations. After the Court of Agrarian Relation
was created on June 14, 1955, until the effectivity of the Agricultural Land Reform Code on August 8,
1963, the procedure for was that provided for in the Rules of the Court of Agrarian Relations This, as
stated, was the procedure applicable when the present suit was filed. And finally, on August 8, 1963, to
the present, the procedure governing agricultural laborer's cases is the Rules of Court by virtue of
Section 155 of the Agricutural Land Reform Code. Neither the Rules of Court required the preliminary
investigations in Question."
In both the foregoing cases, petitioners therein questioned the action of the CAR in giving due course to
the ULP charge filed by private respondents in said cases, without the benefit of preliminary
investigation. In other words, the issue was whether or not a preliminary investigation of the unfair labor
116
practice charge was a condition precedent for the CAR to acquire jurisdiction over an unfair labor
practice suit. And this Court held in the negative.
While there is merit in petitioners' contention that preliminary investigation of unfair labor charge
before the CAR is not required, this case presents a different situation, For the preliminary investigation
was already fait accompliwhen petitioners questioned, through a motion to dismiss, the procedure
adopted by respondent Judge.
Respondent Judge by causing the, conduct of a preliminary investigation, although the same was not
required, and in giving due course to the complaint filed by the investigator on behalf of the private
respondents, indeed committed a breach of procedure. This, however, did not affect his jurisdiction to
try and decide the case. For respondent Court had jurisdiction over the subject matter of the suit and it
acquired jurisdiction over the persons of petitioners with the service of summons. The error committed
was procedural, i.e., in the mere exercise of jurisdiction, not one involving lack or excess of jurisdiction.
Thus — ñé+.£ªwph!1
Admittedly, respondent court had jurisdiction over the case, the impugned orders were issued in the
exercise of such jurisdiction. If the court has jurisdiction of the subject matter and of the person, orders
or decisions upon all questions pertaining to the cause are orders or decisions within its questions and
however irregular or erroncous they may be, they cannot be corrected by certiorari (Gala vs. Cui and
Rodriguez, 25 Phil. 522). Judicial errors or mistakes of law, are proper subjects of appeal Macasieb Sison
vs. CFI of Pangasinan, 34 Phil. 404; Galang vs. Endencia, 73 Phil. 399.14
Besides, the Court of Agrarian Relations, under the provisions of Sec. 155, Republic Act 3844 were
allowed to deviate from usual norms of procedure as long as such excursions did not impair substantial
rights. We here recall the statement of petitioners in their Motion for Reconsideration 15 quoted earlier,
where they in effect conceded that their "substantial rights under Republic Act 3844 or existing laws
prior thereto" have not been affected by the allegedly erroneous procedure followed by respondent
Judge.
Finally, the preliminary investigation which respondent Judge caused to be conducted was not a useless
proceeding; it has a desirable objective. Thus, it has been said that its purpose in unfair labor practice
cases is " ... not only for the protection of the respondent but also for the benefit of the CIR itself so that
the respondent may not be required to defend itself against frivolous and unfounded charges, and the
valuable time of the CIR dissipated and unnecessarily spent in hearing charges without basis.16"
From the point of view of substantive rights and procedural due process, therefore, no prejudice has
been suffered by petitioners.
2. Now with respect to the second question on the jurisdiction of the Court of Agrarian Relations to
award moral and exemplary damages and attomey's fees in the concept of damages, suffice it to state
that said Courts are vested with such authority not only because the Courts of Agrarian Relations have all
the powers and prerogatives inherent in or belonging to the Courts of First instance; 17 but also,
procedurally, to require private respondents to split their causes of action and seek redress in different
Courts would be to encourage multiplicity of suits which is abhorred in the interest of orderly
administration of justice. 18"
On the last contention of petitioners that respondent Court "cannot entertain matters where differential
pay is alleged in the complaint for unfair labor practice" Sec. 154, par. (2), in relation to Secs. 42 and 47
of Republic Act No. 3844 clearly vest in the Courts of Agrarian Relations the jurisdiction to try and decide
 117

cases involving violations of minimum wage fixed by law, or regulations issued by the Department of
Labor, for agricultural workers. 19

Finally, on the need for further proceedings and the proper forum for the same. We have thus arrived at
the conclusion that this Petition is without merit and, therefore, further proceedings will be necessary in
CAR Case No. L- 229 Neg. Occ. But in the meantime that this Petition was pending before this Court, Pres.
Decree 442 otherwise known as Labor Code of the Philippines, was promulgated and became effective
on May 1, 1974. Under the said Code, as amended by Pres. Decree 570-A promulgated on November 1,
1974, the Courts of Agrarian Relations have been divested of jurisdiction over disputes and controversies
involving agricultural workers and the authority to try the same was vested in Labor Arbiters with
appellate recourse to the National Labor Relations Commission. 20 However, the Transitory and Final
Provisions of the Code, as amended, contain no provision for the transfer of agricultural labor cases
pending before Courts of Agrarian Relations to the National Labor Relations Commission. 21 This
notwithstanding and with the promulgation and effectivity of Pres. Decree 946, on June 17, 1976, further
proceedings in this case now properly fall within the jurisdiction of Labor Arbiters and the National Labor
Relations Commission. 22 The records of CAR Case No. L- 229 should therefore be transferred to the Labor
Arbiter at Bacolod for further proceedings.

WHEREFORE, the Petition is hereby DENIED. The writ of preliminary injunction issued on August 3, 1967
is hereby DISSOLVED. Let the records of CAR Case No. L-229 of the Court of Agrarian Relations, Branch 1,
Bacolod City, be transferred to the Office of the Labor Arbiter theseat for further proceedings. Costs
against petitioners.

SO ORDERED.

G.R. No. 75195 August 29, 1988
DAVAO LIGHT AND POWER CO., INC., petitioner,
vs.
HON. CRISTETO D. DINOPOL, Presiding Judge of Branch XIII, Regional Trial Court of Davao City, and
ABUNDIO T. MERCED, respondents.
Breva Law Office for petitioner.
Bienvenido D. Cariaga for private respondent.
FERNAN, C.J.:
Petition for certiorari seeking to set aside the Order dated February 14, 1986 of respondent Judge
Cristeto D. Dinopol of the Regional Trial Court of Davao City, Branch 13, denying petitioner's motion and
supplemental motion to require private respondent to pay additional docket fees.
On July 31, 1984, private respondent Abundio T. Merced doing business under the name and style of
Southern Engineering Works, filed an action in the trial court for damages with preliminary mandatory
injunction against petitioner Davao Light and Power Co., Inc for abruptly disconnecting his electric meter
as a result of which he suffered moral damages, loss of business and credit standing, and loss of profits. 1
In his original and amended complaints, private respondent did not quantify his various claims for
damages except for attorney's fees of P20,000.00 and expenses of litigation of P5,000.00. In both
complaints, he stated that his principal claims would either be proven at the trial or left to the discretion
of the court, As a consequence, he was only required to pay docket fees amounting to P82.50 based on
the quantified claims for attorney's fees and expenses of the suit.
In his direct examination during the hearings on November 22, 1985 and January 24, 1986, private
respondent finally declared the specific amounts of his principal demands as follows: P2,000,000 for loss
of business and credit standing; P5,000,000 for moral damages, and Pl,845,384.50 for loss of profits from
cancelled job orders and proposals, or a grant total of P8,845,384.50.
On December 11, 1985 and January 27,1986, petitioner filed a motion and supplemental motion,
respectively, to require private respondent to pay additional docket fees on his quantified claims for
damages, alleging that pursuant to Batas Pambansa Blg. 129 and Section 5 of Rule 141 of the Rules of
Court, he is supposed to pay graduated docket fees based on the total amount of his money claims, or an
additional sum of P35,080.00 as assessed by the clerk of court. 2
On February 14,1986, respondent Judge Dinopol denied the two motions, reasoning out that while the
determination of the amount of the filing fees is at the time the action is filed, there is no law which
prohibits claims to be proven during the trial or that the assessment thereof be left to the sound
discretion of the court. Moreover, it is premature to require another assessment for filing fees as the
court has yet to determine whether the moral damages and business losses allegedly incurred by therein
plaintiff Merced were by reason of the acts of therein defendant Davao Light and Power Co., Inc.
Furthermore, respondent judge stated that in the event he awards a monetary judgment, the filing fees
shall be a lien on said award. 3
118
On February 28, 1986, petitioner filed a motion for reconsideration. When more than four (4) months
had elapsed without respondent judge resolving the same, petitioner took the instant recourse.
Petitioner contends that respondent judge has the clear and positive duty to enforce the provisions of
the Rules of Court requiring the payment of docket fees, the amount of which is based on
the total amount of the various claims. Where he evades that duty or when he virtually refuses to
perform that duty by denying petitioner's motion to require private respondent to pay additional docket
fees and by sitting on petitioner's motion for reconsideration for an unreasonable length of time, he
clearly acts in excess of jurisdiction and with grave abuse of discretion.
There is merit in petitioner' contention.
The Interim Rules of Court provide:
Rule 11. Application of the totality rule. — In actions where the jurisdiction of the court is dependent on
the amount involved, the test of jurisdiction shall be the aggregate sum of all the money demands,
exclusive only of interest and costs, irrespective of whether or not the separate claims a re owned by or
due to different parties. If any demand is for damages in a civil action, the amount thereof must be
specifically alleged. (Emphasis supplied).
The last sentence of Rule 11 is new. While the accepted practice in the past was where the damage s
alleged in a civil complaint were not specified, the action would pertain to the jurisdiction of the courts
of first instance, under the Interim Rules, this no longer holds true. All claims for damages must now
be specifically alleged for the purpose of determining jurisdiction. This innovation is aimed at doing away
with the pernicious practice by litigants of omitting any specification of the amount of damages in the
complaint, not only to be able to choose the forum for their case, but also in order to mislead the docket
clerk in the assessment of the filing fees and thus evade the payment of the correct charges.
This Court, in the case of Manchester Development Corporation, et al. vs. Court of Appeals, City land
Development Corporation, et al., G.R. No. 75919, May 7, 1987, minced no words in condemning such
unethical practice. For the guidance of the bench and it formulated the following guidelines:
The Court serves warning that it will take drastic action upon a repetition of this unethical practice. To
put a stop to this irregularity, henceforth, all complaints, petitions, answers and other similar pleadings
but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any
case. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, nor
shall otherwise be expunged from the record. (Emphasis supplied).
When respondent judge refused in the instant case to order the re-assessment of the filing fees basedon
the totality of the principal demands, he committed grave abuse of discretion. He acted in contravention
of Rule 11 of the Interim Rules of Court which was already in effect when the complaint for damages was
brought before his sala. Such actuation calls for the corrective writ of certiorari.
If we were to apply the ruling in the Manchester Development Corporation case, all the proceedings held
in connection with Civil Case No. 17122 should peremptorily be considered null and void because, for all
legal purposes, the trial court never acquired jurisdiction over the case by the payment of only P82.50 as
filing fees.
The Court, however, takes note of the fact that the assailed Order of February 14, 1986 was issued prior
to the resolution in the aforecited Manchester Development Corporation case. Its strict application to
the case at bar would therefore be unduly harsh.
 119

WHEREFORE, the instant petition is GRANTED. The questioned Order of February 14, 1986 is hereby set another.
aside. However, so as not to further delay the adjudication of the subject civil suit for damages, private
respondent Abundio T. Merced is given a non-extendible period of five (5) days from notice of this Both the trail court and the Court of Appeals found there was infringement.
decision to AMEND his complaint by specifying the amount of damages being sought, not only in the
body of the pleading but also in the prayer, or his action will be DISMISSED. The docket clerk should base
the assessment of the filing fees on the aggregate amount of the demand appearing in the complaint.

Respondent Judge Cristeto D. Dinopol is ADMONISHED to strictly adhere to the guideline laid down in
the Manchester Development Corporation resolution to preclude a recurrence of a similar incident to
the end that the courts will not be deprived of the correct docket fees.

SO ORDERED.

VENANCIO SAMBAR, doing business under the name and style of CVS Garment Enterprises vs. LEVI
STRAUSS & CO., LEVI STRAUSS (PHIL.), INC.

FACTS:

Private respondents alleged in their complaint that Levi Strauss and Co. (LS&Co.), an internationally
known clothing manufacturer, own the arcuate design trademark which was registered under US
Trademark Registration No. 404,248 on November 16, 1943. That sometime in 1987, CVSGIC and
Venancio Sambar, without the consent and authority of private respondents and in infringement and
unfair competition, sold and advertised, and despite demands to cease and desist, continued to
manufacture, sell and advertise denim, pants under the brand name “Europress” with back pockets
bearing a design similar to the arcuate trademark of private respondents, thereby causing confusion on
the buying public, prejudiced to private respondent’s goodwill and property right.

Sambar filed a separate answer. He admitted that copyright Registration No. 1-1998 was issued to him,
but he denied using it. He said he did not authorize a nyone to use the copyrighted design.

Trial court issued a writ of preliminary injunction enjoining CVSGIC and petitioner from manufacturing,
advertising and selling pants with the arcuate design on their back pockets.

Private respondents moved for reconsideration praying for the cancellation of petitioner’s copyright
registration.

Trial court granted the prayer.

Petitioner appealed to the Court of Appeals which affirmed the ruling of the trial court.

ISSUE:

Whether petitioner infringe on private respondent’s arcuate design.

HELD:

To be entitled to a copyright, the thing being copyrighted must be original, created by the author
through his own skill, labor and judgment, without directly copying or evasivel y imitating the work of

PRUDENTIAL VS TRANS ASIA
DE CISIO N
CHICO-NAZARIO, J:
This is a consolidation of two separate Petitions for Review on Certiorari filed by petitioner Prudential
Guarantee and Assurance, Inc. (PRUDENTIAL) in G.R. No. 151890 and Trans-Asia Shipping Lines, Inc.
(TRANS-ASIA) in G.R. No. 151991, assailing the Decision 1 dated 6 November 2001 of the Court of Appeals
in CA G.R. CV No. 68278, which reversed the Judgment2 dated 6 June 2000 of the Regional Trial Court
(RTC), Branch 13, Cebu City in Civil Case No. CEB-20709. The 29 January 2002 Resolution 3 of the Court of
Appeals, denying PRUDENTIAL’s Motion for Reconsideration and TRANS-ASIA’s Partial Motion for
Reconsideration of the 6 November 2001 Decision, is likewise sought to be annulled and set aside.
The Facts
The material antecedents as found by the court a quo and adopted by the appellate court are as follows:
Plaintiff [TRANS-ASIA] is the owner of the vessel M/V Asia Korea. In consideration of payment of
premiums, defendant [PRUDENTIAL] insured M/V Asia Korea for loss/damage of the hull and machinery
arising from perils, inter alia, of fire and explosion for the sum of P40 Million, beginning [from] the period
[of] July 1, 1993 up to July 1, 1994. This is evidenced by Marine Policy No. MH93/1363 (Exhibits "A" to
"A-11"). On October 25, 1993, while the policy was in force, a fire broke out while [M/V Asia Korea was]
undergoing repairs at the port of Cebu. On October 26, 1993 plaintiff [TRANS-ASIA] filed its notice of
claim for damage sustained by the vessel. This is evidenced by a letter/formal claim of even date (Exhibit
"B"). Plaintiff [TRANS-ASIA] reserved its right to subsequently notify defendant [PRUDENTIAL] as to the
full amount of the claim upon final survey and determination by average adjuster Richard Hogg
International (Phil.) of the damage sustained by reason of fire. An adjuster’s report on the fire in
question was submitted by Richard Hogg International together with the U-Marine Surveyor Report
(Exhibits "4" to "4-115").
On May 29, 1995[,] plaintiff [TRANS-ASIA] executed a document denominated "Loan and Trust receipt", a
portion of which read (sic):
"Received from Prudential Guarantee and Assurance, Inc., the sum of PESOS THREE MILLION ONLY
(P3,000,000.00) as a loan without interest under Policy No. MH 93/1353 [sic], repayable only in the event
and to the extent that any net recovery is made by Trans-Asia Shipping Corporation, from any person or
persons, corporation or corporations, or other parties, on account of loss by any casualty for which they
may be liable occasioned by the 25 October 1993: Fire on Board." (Exhibit "4")
In a letter dated 21 April 1997 defendant [PRUDENTIAL] denied plaintiff’s claim (Exhibit "5"). The letter
reads:
"After a careful review and evaluation of your claim arising from the above-captioned incident, it has
been ascertained that you are in breach of policy conditions, among them "WARRANTED VESSEL
CLASSED AND CLASS MAINTAINED". Accordingly, we regret to advise that your claim is not compensable
and hereby DENIED."
This was followed by defendant’s letter dated 21 July 1997 requesting the return or payment of the
P3,000,000.00 within a period of ten (10) days from receipt of the letter (Exhibit "6"). 4
120
Following this development, on 13 August 1997, TRANS-ASIA filed a Complaint 5 for Sum of Money
against PRUDENTIAL with the RTC of Cebu City, docketed as Civil Case No. CEB-20709, wherein TRANS-
ASIA sought the amount of P8,395,072.26 from PRUDENTIAL, alleging that the same represents the
balance of the indemnity due upon the insurance policy in the total amount of P11,395,072.26. TRANS-
ASIA similarly sought interest at 42% per annum citing Section 243 6 of Presidential Decreee No. 1460,
otherwise known as the "Insurance Code," as amended.
In its Answer,7 PRUDENTIAL denied the material allegations of the Complaint and interposed the defense
that TRANS-ASIA breached insurance policy conditions, in particular: "WARRANTED VESSEL CLASSED AND
CLASS MAINTAINED." PRUDENTIAL further alleged that it acted as facts and law require and incurred no
liability to TRANS-ASIA; that TRANS-ASIA has no cause of action; and, that its claim has been effectively
waived and/or abandoned, or it is estopped from pursuing the same. By way of a counterclaim,
PRUDENTIAL sought a refund of P3,000,000.00, which it allegedly advanced to TRANS-ASIA by way of a
loan without interest and without prejudice to the final evaluation of the claim, including the amounts of
P500,000.00, for survey fees and P200,000.00, representing attorney’s fees.
The Ruling of the Trial Court
On 6 June 2000, the court a quo rendered Judgment8 finding for (therein defendant) PRUDENTIAL. It
ruled that a determination of the parties’ liabilities hinged on whether TRANS-ASIA violated and
breached the policy conditions on WARRANTED VESSEL CLASSED AND CLASS MAINTAINED. It interpreted
the provision to mean that TRANS-ASIA is required to maintain the vessel at a certain class at all times
pertinent during the life of the policy. According to the court a quo, TRANS-ASIA failed to prove
compliance of the terms of the warranty, the violation thereof entitled PRUDENTIAL, the insured party,
to rescind the contract.9
Further, citing Section 10710 of the Insurance Code, the court a quo ratiocinated that the concealment
made by TRANS-ASIA that the vessel was not adequately maintained to preserve its class was a material
concealment sufficient to avoid the policy and, thus, entitled the injured party to rescind the contract.
The court a quo found merit in PRUDENTIAL’s contention that there was nothing in the adjustmentof the
particular average submitted by the adjuster that would show that TRANS-ASIA was not in breach of the
policy. Ruling on the denominated loan and trust receipt, the court a quo said that in substance and in
form, the same is a receipt for a loan. It held that if TRANS-ASIA intended to receive the amount of
P3,000,000.00 as advance payment, it should have so clearly stated as such.
The court a quo did not award PRUDENTIAL’s claim for P500,000.00, representing expert survey fees on
the ground of lack of sufficient basis in support thereof. Neither did it award attorney’s fees on the
rationalization that the instant case does not fall under the exceptions stated in Article 220811 of the Civil
Code. However, the court a quo granted PRUDENTIAL’s counterclaim stating that there is factual and
legal basis for TRANS-ASIA to return the amount of P3,000,000.00 by way of loan without interest.
The decretal portion of the Judgment of the RTC reads:
WHEREFORE, judgment is hereby rendered DISMISSING the complaint for its failure to prove a cause of
action.
On defendant’s counterclaim, plaintiff is directed to return the sum of P3,000,000.00 representing the
loan extended to it by the defendant, within a period of ten (10) days from and after this judgment shall
have become final and executory.12

The Ruling of the Court of Appeals
On appeal by TRANS-ASIA, the Court of Appeals, in its assailed Decision of 6 November 2001, reversed
the 6 June 2000 Judgment of the RTC.
On the issue of TRANS-ASIA’s alleged breach of warranty of the policy condition CLASSED AND CLASS
MAINTAINED, the Court of Appeals ruled that PRUDENTIAL, as the party asserting the non-
compensability of the loss had the burden of proof to show that TRANS-ASIA breached the warranty,
which burden it failed to discharge. PRUDENTIAL cannot rely on the lack of certification to the effect that
TRANS-ASIA was CLASSED AND CLASS MAINTAINED as its sole basis for reaching the conclusion that the
warranty was breached. The Court of Appeals opined that the lack of a certification does not necessarily
mean that the warranty was breached by TRANS-ASIA. Instead, the Court of Appeals considered
PRUDENTIAL’s admission that at the time the insurance contract was entered into between the parties,
the vessel was properly classed by Bureau Veritas, a classification society recognized by the industry. The
Court of Appeals similarly gave weight to the fact that it was the responsibility of Richards Hogg
International (Phils.) Inc., the average adjuster hired by PRUDENTIAL, to secure a copy of such
certification to support its conclusion that mere absence of a certification does not warrant denial of
TRANS-ASIA’s claim under the insurance policy.
In the same token, the Court of Appeals found the subject warranty allegedly breached by TRANS-ASIA to
be a rider which, while contained in the policy, was inserted by PRUDENTIAL without the intervention of
TRANS-ASIA. As such, it partakes of a nature of a contract d’adhesion which should be construed against
PRUDENTIAL, the party which drafted the contract. Likewise, according to the Court of Appeals,
PRUDENTIAL’s renewal of the insurance policy from noon of 1 July 1994 to noon of 1 July 1995, and then
again, until noon of 1 July 1996 must be deemed a waiver by PRUDENTIAL of any breach of warranty
committed by TRANS-ASIA.
Further, the Court of Appeals, contrary to the ruling of the court a quo, interpreted the transaction
between PRUDENTIAL and TRANS-ASIA as one of subrogation, instead of a loan. The Court of Appeals
concluded that TRANS-ASIA has no obligation to pay back the amount of P3,000.000.00 to PRUDENTIAL
based on its finding that the aforesaid amount was PRUDENTIAL’s partial payment to TRANS-ASIA’s claim
under the policy. Finally, the Court of Appeals denied TRANS-ASIA’s prayer for attorney’s fees, but held
TRANS-ASIA entitled to double interest on the policy for the duration of the delay of payment of the
unpaid balance, citing Section 244 13 of the Insurance Code.
Finding for therein appellant TRANS-ASIA, the Court of Appeals ruled in this wise:
WHEREFORE, the foregoing consideration, We find for Appellant. The instant appeal is ALLOWED and the
Judgment appealed from REVERSED. The P3,000,000.00 initially paid by appellee Prudential Guarantee
Assurance Incorporated to appellant Trans-Asia and covered by a "Loan and Trust Receipt" dated 29 May
1995 is HELD to be in partial settlement of the loss suffered by appellant and covered by Marine Policy
No. MH93/1363 issued by appellee. Further, appellee is hereby ORDERED to pay appellant the additional
amount of P8,395,072.26 representing the balance of the loss suffered by the latter as recommended by
the average adjuster Richard Hogg International (Philippines) in its Report, with double interest starting
from the time Richard Hogg’s Survey Report was completed, or on 13 August 1996, until the same is fully
paid.
All other claims and counterclaims are hereby DISMISSED.
All costs against appellee.14
121
Not satisfied with the judgment, PRUDENTIAL and TRANS-ASIA filed a Motion for Reconsideration and
Partial Motion for Reconsideration thereon, respectively, which motions were denied by the Court of
Appeals in the Resolution dated 29 January 2002.
The Issues
Aggrieved, PRUDENTIAL filed before this Court a Petition for Review, docketed as G.R. No. 151890,
relying on the following grounds, viz:
I.
THE AWARD IS GROSSLY UNCONSCIONABLE.
II.
THE COURT OF APPEALS ERRED IN HOLDING THAT THERE WAS NO VIOLATION BY TRANS-ASIA OF A
MATERIAL WARRANTY, NAMELY, WARRANTY CLAUSE NO. 5, OF THE INSURANCE POLICY.
III.
THE COURT OF APPEALS ERRED IN HOLDING THAT PRUDENTIAL, AS INSURER HAD THE BURDEN OF
PROVING THAT THE ASSURED, TRANS-ASIA, VIOLATED A MATERIAL WARRANTY.
IV.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE WARRANTY CLAUSE EMBODIED IN THE
INSURANCE POLICY CONTRACT WAS A MERE RIDER.
V.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE ALLEGED RENEWALS OF THE POLICY
CONSTITUTED A WAIVER ON THE PART OF PRUDENTIAL OF THE BREACH OF THE WARRANTY BY TRANS-
ASIA.
VI.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE "LOAN AND TRUST RECEIPT" EXECUTED BY
TRANS-ASIA IS AN ADVANCE ON THE POLICY, THUS CONSTITUTING PARTIAL PAYMENT THEREOF.
VII.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE ACCEPTANCE BY PRUDENTIAL OF THE FINDINGS
OF RICHARDS HOGG IS INDICATIVE OF A WAIVER ON THE PART OF PRUDENTIAL OF ANY VIOLATION BY
TRANS-ASIA OF THE WARRANTY.
VIII.
THE COURT OF APPEALS ERRRED (sic) IN REVERSING THE TRIAL COURT, IN FINDING THAT PRUDENTIAL
"UNJUSTIFIABLY REFUSED" TO PAY THE CLAIM AND IN ORDERING PRUDENTIAL TO PAY TRANS-ASIA
P8,395,072.26 PLUS DOUBLE INTEREST FROM 13 AUGUST 1996, UNTIL [THE] SAME IS FULLY PAID. 15
Similarly, TRANS-ASIA, disagreeing in the ruling of the Court of Appeals filed a Petition for Review
docketed as G.R. No. 151991, raising the following grounds for the allowance of the petition, to wit:

I.
THE HONORABLE COURT OF APPEALS ERRED IN NOT AWARDING ATTORNEY’S FEES TO PETITIONER
TRANS-ASIA ON THE GROUND THAT SUCH CAN ONLY BE AWARDED IN THE CASES ENUMERATED IN
ARTICLE 2208 OF THE CIVIL CODE, AND THERE BEING NO BAD FAITH ON THE PART OF RESPONDENT
PRUDENTIAL IN DENYING HEREIN PETITIONER TRANS-ASIA’S INSURANCE CLAIM.
II.
THE "DOUBLE INTEREST" REFERRED TO IN THE DECISION DATED 06 NOVEMBER 2001 SHOULD BE
CONSTRUED TO MEAN DOUBLE INTEREST BASED ON THE LEGAL INTEREST OF 12%, OR INTEREST AT THE
RATE OF 24% PER ANNUM. 16
In our Resolution of 2 December 2002, we granted TRANS-ASIA’s Motion for Consolidation 17 of G.R. Nos.
151890 and 151991;18 hence, the instant consolidated petitions.
In sum, for our main resolution are: (1) the liability, if any, of PRUDENTIAL to TRANS-ASIA arising from
the subject insurance contract; (2) the liability, if any, of TRANS-ASIA to PRUDENTIAL arising from the
transaction between the parties as evidenced by a document denominated as "Loan and Trust Receipt,"
dated 29 May 1995; and (3) the amount of interest to be imposed on the liability, if any, of either or both
parties.
Ruling of the Court
Prefatorily, it must be emphasized that in a petition for review, only questions of law, and not questions
of fact, may be raised. 19 This rule may be disregarded only when the findings of fact of the Court of
Appeals are contrary to the findings and conclusions of the trial court, or are not supported by the
evidence on record. 20 In the case at bar, we find an incongruence between the findings of fact of the
Court of Appeals and the court a quo, thus, in our determination of the issues, we are constrained to
assess the evidence adduced by the parties to make appropriate findings of facts as are necessary.
I.
A. PRUDENTIAL failed to establish that TRANS-ASIA violated and breached the policy condition on
WARRANTED VESSEL CLASSED AND CLASS MAINTAINED, as contained in the subject insurance contract.
In resisting the claim of TRANS-ASIA, PRUDENTIAL posits that TRANS-ASIA violated an express and
material warranty in the subject insurance contract, i.e., Marine Insurance Policy No. MH93/1363,
specifically Warranty Clause No. 5 thereof, which stipulates that the insured vessel, "M/V ASIA KOREA" is
required to be CLASSED AND CLASS MAINTAINED. According to PRUDENTIAL, on 25 October 1993, or at
the time of the occurrence of the fire, "M/V ASIA KOREA" was in violation of the warranty as it was not
CLASSED AND CLASS MAINTAINED. PRUDENTIAL submits that Warranty Clause No. 5 was a condition
precedent to the recovery of TRANS-ASIA under the policy, the violation of which entitled PRUDENTIAL
to rescind the contract under Sec. 74 21 of the Insurance Code.
The warranty condition CLASSED AND CLASS MAINTAINED was explained by PRUDENTIAL’s Senior
Manager of the Marine and Aviation Division, Lucio Fernandez. The pertinent portions of his testimony
on direct examination is reproduced hereunder, viz:
ATTY. LIM
122
Q Please tell the court, Mr. Witness, the result of the evaluation of this claim, what final action was
taken?
A It was eventually determined that there was a breach of the policy condition, and basically there is a
breach of policy warranty condition and on that basis the claim was denied.
Q To refer you (sic) the "policy warranty condition," I am showing to you a policy here marked as Exhibits
"1", "1-A" series, please point to the warranty in the policy which you said was breached or violated by
the plaintiff which constituted your basis for denying the claim as you testified.
A Warranted Vessel Classed and Class Maintained.
ATTY. LIM
Witness pointing, Your Honor, to that portion in Exhibit "1-A" which is the second page of the policy
below the printed words: "Clauses, Endorsements, Special Conditions and Warranties," below this are
several typewritten clauses and the witness pointed out in particular the clause reading: "Warranted
Vessel Classed and Class Maintained."
COURT
Q Will you explain that particular phrase?
A Yes, a warranty is a condition that has to be complied with by the insured. When we say a class
warranty, it must be entered in the classification society.
COURT
Slowly.
WITNESS
(continued)
A A classification society is an organization which sets certain standards for a vessel to maintain in order
to maintain their membership in the classification society. So, if they failed to meet that standard, they
are considered not members of that class, and thus breaching the warranty, that requires them t o
maintain membership or to maintain their class on that classification society. And it is not sufficient that
the member of this classification society at the time of a loss, their membership must be continuous for
the whole length of the policy such that during the effectivity of the policy, their classification is
suspended, and then thereafter, they get reinstated, that again still a breach of the warranty that they
maintained their class (sic). Our maintaining team membership in the classification society thereby
maintaining the standards of the vessel (sic).
ATTY. LIM
Q Can you mention some classification societies that you know?
A Well we have the Bureau Veritas, American Bureau of Shipping, D&V Local Classification Society, The
Philippine Registration of Ships Society, China Classification, NKK and Company Classification Society, and
many others, we have among others, there are over 20 worldwide. 22

At the outset, it must be emphasized that the party which alleges a fact as a matter of defense has the
burden of proving it. PRUDENTIAL, as the party which asserted the claim that TRANS-ASIA breached the
warranty in the policy, has the burden of evidence to establish the same. Hence, on the part of
PRUDENTIAL lies the initiative to show proof in support of its defense; otherwise, failing to establish the
same, it remains self-serving. Clearly, if no evidence on the alleged breach of TRANS-ASIA of the subject
warranty is shown, a fortiori, TRANS-ASIA would be successful in claiming on the policy. It follows that
PRUDENTIAL bears the burden of evidence to establish the fact of breach.
In our rule on evidence, TRANS-ASIA, as the plaintiff below, necessarily has the burden of proof to show
proof of loss, and the coverage thereof, in the subject insurance policy. However, in the course of trial in
a civil case, once plaintiff makes out a prima facie case in his favor, the duty or the burden of evidence
shifts to defendant to controvert plaintiff’s prima facie case, otherwise, a verdict must be returned in
favor of plaintiff. 23 TRANS-ASIA was able to establish proof of loss and the coverage of the loss, i.e., 25
October 1993: Fire on Board. Thereafter, the burden of evidence shifted to PRUDENTIAL to counter
TRANS-ASIA’s case, and to prove its special and affirmative defense that TRANS-ASIA was in violation of
the particular condition on CLASSED AND CLASS MAINTAINED.
We sustain the findings of the Court of Appeals that PRUDENTIAL was not successful in discharging the
burden of evidence that TRANS-ASIA breached the subject policy condition on CLASSED AND CLASS
MAINTAINED.
Foremost, PRUDENTIAL, through the Senior Manager of its Marine and Aviation Division, Lucio
Fernandez, made a categorical admission that at the time of the procurement of the insurance contract
in July 1993, TRANS-ASIA’s vessel, "M/V Asia Korea" was properly classed by Bureau Veritas, thus:
Q Kindly examine the records particularly the policy, please tell us if you know whether M/V Asia Korea
was classed at the time (sic) policy was procured perthe (sic) insurance was procured that Exhibit "1" on
1st July 1993 (sic).
WITNESS
A I recall that they were classed.
ATTY. LIM
Q With what classification society?
A I believe with Bureau Veritas. 24
As found by the Court of Appeals and as supported by the records, Bureau Veritas is a classification
society recognized in the marine industry. As it is undisputed that TRANS-ASIA was properly classed at
the time the contract of insurance was entered into, thus, it becomes incumbent upon PRUDENTIAL to
show evidence that the status of TRANS-ASIA as being properly CLASSED by Bureau Veritas had shiftedin
violation of the warranty. Unfortunately, PRUDENTIAL failed to support the allegation.
We are in accord with the ruling of the Court of Appeals that the lack of a certification in PRUDENTIAL’s
records to the effect that TRANS-ASIA’s "M/V Asia Korea" was CLASSED AND CLASS MAINTAINED at the
time of the occurrence of the fire cannot be tantamount to the conclusion that TRANS-ASIA in fact
breached the warranty contained in the policy. With more reason must we sustain the findings of the
Court of Appeals on the ground that as admitted by PRUDENTIAL, it was likewise the responsibility of the
average adjuster, Richards Hogg International (Phils.), Inc., to secure a copy of such certification, and the
123
alleged breach of TRANS-ASIA cannot be gleaned from the average adjuster’s survey report, or
adjustment of particular average per "M/V Asia Korea" of the 25 October 1993 fire on board.
We are not unmindful of the clear language of Sec. 74 of the Insurance Code which provides that, "the
violation of a material warranty, or other material provision of a policy on the part of either party
thereto, entitles the other to rescind." It is generally accepted that "[a] warranty is a statement or
promise set forth in the policy, or by reference incorporated therein, the untruth or non-fulfillment of
which in any respect, and without reference to whether the insurer was in fact prejudi ced by such
untruth or non-fulfillment, renders the policy voidable by the insurer."25 However, it is similarly
indubitable that for the breach of a warranty to avoid a policy, the same must be duly shown by the
party alleging the same. We cannot sustain an allegation that is unfounded. Consequently, PRUDENTIAL,
not having shown that TRANS-ASIA breached the warranty condition, CLASSED AND CLASS MAINTAINED,
it remains that TRANS-ASIA must be allowed to recover its rightful claims on the policy.
B. Assuming arguendo that TRANS-ASIA violated the policy condition on WARRANTED VESSEL CLASSED
AND CLASS MAINTAINED, PRUDENTIAL made a valid waiver of the same.
The Court of Appeals, in reversing the Judgment of the RTC which held that TRANS-ASIA breached the
warranty provision on CLASSED AND CLASS MAINTAINED, underscored that PRUDENTIAL can be deemed
to have made a valid waiver of TRANS-ASIA’s breach of warranty as alleged, ratiocinating, thus:
Third, after the loss, Prudential renewed the insurance policy of Trans-Asia for two (2) consecutive years,
from noon of 01 July 1994 to noon of 01 July 1995, and then again until noon of 01 July 1996. This
renewal is deemed a waiver of any breach of warranty.26
PRUDENTIAL finds fault with the ruling of the appellate court when it ruled that the renewal policies are
deemed a waiver of TRANS-ASIA’s alleged breach, averring herein that the subsequent policies,
designated as MH94/1595 and MH95/1788 show that they were issued only on 1 July 1994 and 3 July
1995, respectively, prior to the time it made a request to TRANS-ASIA that it be furnished a copy of the
certification specifying that the insured vessel "M/V Asia Korea" was CLASSED AND CLASS MAINTAINED.
PRUDENTIAL posits that it came to know of the breach by TRANS-ASIA of the subject warranty clause
only on 21 April 1997. On even date, PRUDENTIAL sent TRANS-ASIA a letter of denial, advising the latter
that their claim is not compensable. In fine, PRUDENTIAL would have this Court believe that the issuance
of the renewal policies cannot be a waiver because they were issued without knowledge of the alleged
breach of warranty committed by TRANS-ASIA.27
We are not impressed. We do not find that the Court of Appeals was in error when it held that
PRUDENTIAL, in renewing TRANS-ASIA’s insurance policy for two consecutive years after the loss covered
by Policy No. MH93/1363, was considered to have waived TRANS-ASIA’s breach of the subject warranty,
if any. Breach of a warranty or of a condition renders the contract defeasible at the option of the insurer;
but if he so elects, he may waive his privilege and power to rescind by the mere expression of an
intention so to do. In that event his liability under the policy continues as before. 28 There can be no
clearer intention of the waiver of the alleged breach than the renewal of the policy insurance granted by
PRUDENTIAL to TRANS-ASIA in MH94/1595 and MH95/1788, issued in the years 1994 and 1995,
respectively.
To our mind, the argument is made even more credulous by PRUDENTIAL’s lack of proof to support its
allegation that the renewals of the policies were taken only after a request was made to TRANS-ASIA to
furnish them a copy of the certificate attesting that "M/V Asia Korea" was CLASSED AND CLASS
MAINTAINED. Notwithstanding PRUDENTIAL’s claim that no certification was issued to that effect, it

renewed the policy, thereby, evidencing an intention to waive TRANS-ASIA’s alleged breach. Clearly, by
granting the renewal policies twice and successively after the loss, the intent was to benefit the insured,
TRANS-ASIA, as well as to waive compliance of the warranty.
The foregoing finding renders a determination of whether the subject warranty is a rider, moot, as raised
by the PRUDENTIAL in its assignment of errors. Whether it is a rider will not effectively alter the result for
the reasons that: (1) PRUDENTIAL was not able to discharge the burden of evidence to show that TRANS-
ASIA committed a breach, thereof; and (2) assuming arguendo the commission of a breach by TRANS-
ASIA, the same was shown to have been waived by PRUDENTIAL.
II.
A. The amount of P3,000,000.00 granted by PRUDENTIAL to TRANS- ASIA via a transaction between the
parties evidenced by a document denominated as "Loan and Trust Receipt," dated 29 May 1995
constituted partial payment on the policy.
It is undisputed that TRANS-ASIA received from PRUDENTIAL the amount of P3,000,000.00. The same
was evidenced by a transaction receipt denominated as a "Loan and Trust Receipt," dated 29 May 1995,
reproduced hereunder:
LOAN AND TRUST RECEIPT
Claim File No. MH-93-025 May 29, 1995
P3,000,000.00
Check No. PCIB066755
Received FROM PRUDENTIAL GUARANTEE AND ASSURANCE INC., the sum of PESOS THREE MILLION
ONLY (P3,000,000.00) as a loan without interest, under Policy No. MH93/1353, repayable only in the
event and to the extent that any net recovery is made by TRANS ASIA SHIPPING CORP., from any person
or persons, corporation or corporations, or other parties, on account of loss by any casualty for which
they may be liable, occasioned by the 25 October 1993: Fire on Board.
As security for such repayment, we hereby pledge to PRUDENTIAL GUARANTEE AND ASSURANCE INC.
whatever recovery we may make and deliver to it all documents necessary to prove our interest in said
property. We also hereby agree to promptly prosecute suit against such persons, corporation or
corporations through whose negligence the aforesaid loss was caused or who may otherwise be
responsible therefore, with all due diligence, in our own name, but at the expense of and under the
exclusive direction and control of PRUDENTIAL GUARANTEE AND ASSURANCE INC.
TRANS-ASIA SHIPPING CORPORATION29
PRUDENTIAL largely contends that the "Loan and Trust Receipt" executed by the parties evidenced a loan
of P3,000,000.00 which it granted to TRANS-ASIA, and not an advance payment on the policy or a partial
payment for the loss. It further submits that it is a customary practice for insurance companies in this
country to extend loans gratuitously as part of good business dealing with their assured, in order to
afford their assured the chance to continue business without embarrassment while awaiting outcome of
the settlement of their claims. 30 According to PRUDENTIAL, the "Trust and Loan Agreement" did not
subrogate to it whatever rights and/or actions TRANS-ASIA may have against third persons, and it cannot
by no means be taken that by virtue thereof, PRUDENTIAL was granted irrevocable power of attorney by
TRANS-ASIA, as the sole power to prosecute lies solely with the latter.
124
The Court of Appeals held that the real character of the transaction between the parties as evidenced by
the "Loan and Trust Receipt" is that of an advance payment by PRUDENTIAL of TRANS-ASIA’s claim on
the insurance, thus:
The Philippine Insurance Code (PD 1460 as amended) was derived from the old Insurance Law Act No.
2427 of the Philippine Legislature during the American Regime. The Insurance Act was lifted verbatim
from the law of California, except Chapter V thereof, which was taken largely from the insurance law of
New York. Therefore, ruling case law in that jurisdiction is to Us persuasive in interpreting provisions of
our own Insurance Code. In addition, the application of the adopted statute should correspond in
fundamental points with the application in its country of origin x x x.
xxxx
Likewise, it is settled in that jurisdiction that the (sic) notwithstanding recitals in the Loan Receipt that
the money was intended as a loan does not detract from its real character as payment of claim, thus:
"The receipt of money by the insured employers from a surety company for losses on account of forgery
of drafts by an employee where no provision or repayment of the money was made except upon
condition that it be recovered from other parties and neither interest nor security for the asserted debts
was provided for, the money constituted the payment of a liability and not a mere loan, notwithstanding
recitals in the written receipt that the money was intended as a mere loan."
What is clear from the wordings of the so-called "Loan and Trust Receipt Agreement" is that appellant is
obligated to hand over to appellee "whatever recovery (Trans Asia) may make and deliver to (Prudential)
all documents necessary to prove its interest in the said property." For all intents and purposes
therefore, the money receipted is payment under the policy, with Prudential having the right of
subrogation to whatever net recovery Trans-Asia may obtain from third parties resulting from the fire. In
the law on insurance, subrogation is an equitable assignment to the insurer of all remedies which the
insured may have against third person whose negligence or wrongful act caused the loss covered by the
insurance policy, which is created as the legal effect of payment by the insurer as an assignee in equity.
The loss in the first instance is that of the insured but after reimbursement or compensation, it becomes
the loss of the insurer. It has been referred to as the doctrine of substitution and rests on the principle
that substantial justice should be attained regardless of form, that is, its basis is the doing of complete,
essential, and perfect justice between all the parties without regard to form. 31
We agree. Notwithstanding its designation, the tenor of the "Loan and Trust Receipt" evidences that the
real nature of the transaction between the parties was that the amount of P3,000,000.00 was not
intended as a loan whereby TRANS-ASIA is obligated to pay PRUDENTIAL, but rather, the same was a
partial payment or an advance on the policy of the claims due to TRANS-ASIA.
First, the amount of P3,000,000.00 constitutes an advance payment to TRANS-ASIA by PRUDENTIAL,
subrogating the former to the extent of "any net recovery made by TRANS ASIA SHIPPING CORP., from
any person or persons, corporation or corporations, or other parties, on account of loss by any casualty
for which they may be liable, occasioned by the 25 October 1993: Fire on Board."32
Second, we find that per the "Loan and Trust Receipt," even as TRANS-ASIA agreed to "promptly
prosecute suit against such persons, corporation or corporations through whose negligence the aforesaid
loss was caused or who may otherwise be responsible therefore, with all due diligence" in its name, the
prosecution of the claims against such third persons are to be carried on "at the expense of and under
the exclusive direction and control of PRUDENTIAL GUARANTEE AND ASSURANCE INC."33 The clear

import of the phrase "at the expense of and under the exclusive direction and control" as used in the
"Loan and Trust Receipt" grants solely to PRUDENTIAL the power to prosecute, even as the same is
carried in the name of TRANS-ASIA, thereby making TRANS-ASIA merely an agent of PRUDENTIAL, the
principal, in the prosecution of the suit against parties who may have occasioned the loss.
Third, per the subject "Loan and Trust Receipt," the obligation of TRANS-ASIA to repay PRUDENTIAL is
highly speculative and contingent, i.e., only in the event and to the extent that any net recovery is made
by TRANS-ASIA from any person on account of loss occasioned by the fire of 25 October 1993. The
transaction, therefore, was made to benefit TRANS-ASIA, such that, if no recovery from third parties is
made, PRUDENTIAL cannot be repaid the amount. Verily, we do not think that this is constitutive of a
loan.34 The liberality in the tenor of the "Loan and Trust Receipt" in favor of TRANS-ASIA leads to the
conclusion that the amount of P3,000,000.00 was a form of an advance payment on TRANS-ASIA’s claim
on MH93/1353.
III.
A. PRUDENTIAL is directed to pay TRANS-ASIA the amount of P8,395,072.26, representing the balance of
the loss suffered by TRANS-ASIA and covered by Marine Policy No. MH93/1363.
Our foregoing discussion supports the conclusion that TRANS-ASIA is entitled to the unpaid claims
covered by Marine Policy No. MH93/1363, or a total amount of P8,395,072.26.
B. Likewise, PRUDENTIAL is directed to pay TRANS-ASIA, damages in the form of attorney’s fees
equivalent to 10% of P8,395,072.26.
The Court of Appeals denied the grant of attorney’s fees. It held that attorney’s fees cannot be awarded
absent a showing of bad faith on the part of PRUDENTIAL in rejecting TRANS-ASIA’s claim,
notwithstanding that the rejection was erroneous. According to the Court of Appeals, attorney’s fees can
be awarded only in the cases enumerated in Article 2208 of the Civil Code which finds no application in
the instant case.
We disagree. Sec. 244 of the Insurance Code grants damages consisting of attorney’s fees and other
expenses incurred by the insured after a finding by the Insurance Commissioner or the Court, as the case
may be, of an unreasonable denial or withholding of the payment of the claims due. Moreover, the law
imposes an interest of twice the ceiling prescribed by the Monetary Board on the amount of the claim
due the insured from the date following the time prescribed in Section 24235 or in Section 243, 36 as the
case may be, until the claim is fully satisfied. Finally, Section 244 considers the failure to pay the claims
within the time prescribed in Sections 242 or 243, when applicable, as prima facie evidence of
unreasonable delay in payment.
To the mind of this Court, Section 244 does not require a showing of bad faith in order that attorney’s
fees be granted. As earlier stated, under Section 244, a prima facie evidence of unreasonable delay in
payment of the claim is created by failure of the insurer to pay the claim within the time fixed in both
Sections 242 and 243 of the Insurance Code. As established in Section 244, by reason of the delay and
the consequent filing of the suit by the insured, the insurers shall be adjudged to pay damages which
shall consist of attorney’s fees and other expenses incurred by the insured.37
Section 244 reads:
In case of any litigation for the enforcement of any policy or contract of insurance, it shall be the duty of
the Commissioner or the Court, as the case may be, to make a finding as to whether the payment of the
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claim of the insured has been unreasonably denied or withheld; and in the affirmative case, the
insurance company shall be adjudged to pay damages which shall consist of attorney’s fees and other
expenses incurred by the insured person by reason of such unreasonable denial or withholding of
payment plus interest of twice the ceiling prescribed by the Monetary Board of the amount of the claim
due the insured, from the date following the time prescribed in section two hundred forty-two or in
section two hundred forty-three, as the case may be, until the claim is fully satisfied; Provided, That the
failure to pay any such claim within the time prescribed in said sections shall be considered prima facie
evidence of unreasonable delay in payment.
Sections 243 and 244 of the Insurance Code apply when the court finds an unreasonable del ay or refusal
in the payment of the insurance claims.
In the case at bar, the facts as found by the Court of Appeals, and confirmed by the records show that
there was an unreasonable delay by PRUDENTIAL in the payment of the unpaid balance of P8,395,072.26
to TRANS-ASIA. On 26 October 1993, a day after the occurrence of the fire in "M/V Asia Korea", TRANS-
ASIA filed its notice of claim. On 13 August 1996, the adjuster, Richards Hogg International (Phils.), Inc.,
completed its survey report recommending the amount of P11,395,072.26 as the total indemnity due to
TRANS-ASIA.38 On 21 April 1997, PRUDENTIAL, in a letter39 addressed to TRANS-ASIA denied the latter’s
claim for the amount of P8,395,072.26 representing the balance of the total indemnity. On 21 July 1997,
PRUDENTIAL sent a second letter 40 to TRANS-ASIA seeking a return of the amount of P3,000,000.00. On
13 August 1997, TRANS-ASIA was constrained to file a complaint for sum of money against PRUDENTIAL
praying, inter alia, for the sum of P8,395,072.26 representing the balance of the proceeds of the
insurance claim.
As can be gleaned from the foregoing, there was an unreasonable delay on the part of PRUDENTIAL to
pay TRANS-ASIA, as in fact, it refuted the latter’s right to the insurance claims, from the time proof of
loss was shown and the ascertainment of the loss was made by the insurance adjuster. Evidently,
PRUDENTIAL’s unreasonable delay in satisfying TRANS-ASIA’s unpaid claims compelled the latter to file a
suit for collection.
Succinctly, an award equivalent to ten percent (10%) of the unpaid proceeds of the policy as attorney’s
fees to TRANS-ASIA is reasonable under the circumstances, or otherwise stated, ten percent (10%) of
P8,395,072.26. In the case of Cathay Insurance, Co., Inc. v. Court of Appeals,41 where a finding of an
unreasonable delay under Section 244 of the Insurance Code was made by this Court, we grant an award
of attorney’s fees equivalent to ten percent (10%) of the total proceeds. We find no reason to deviate
from this judicial precedent in the case at bar.
C. Further, the aggregate amount (P8,395,072.26 plus 10% thereof as attorney’s fees) shall be imposed
double interest in accordance with Section 244 of the Insurance Code.
Section 244 of the Insurance Code is categorical in imposing an interest twice the ceiling prescribed by
the Monetary Board due the insured, from the date following the time prescribed in Section 242 or in
Section 243, as the case may be, until the claim is fully satisfied. In the case at bar, we find Section 243 to
be applicable as what is involved herein is a marine insurance, clearly, a policy other than life insurance.
Section 243 is hereunder reproduced:
SEC. 243. The amount of any loss or damage for which an insurer may be liable, under any policy other
than life insurance policy, shall be paid within thirty days after proof of loss is received by the insurer and
ascertainment of the loss or damage is made either by agreement between the insured and the insurer

or by arbitration; but if such ascertainment is not had or made within sixty days after such receipt by the
insurer of the proof of loss, then the loss or damage shall be paid within ninety days after such receipt.
Refusal or failure to pay the loss or damage within the time prescribed herein will entitle the assured to
collect interest on the proceeds of the policy for the duration of the delay at the rate of twice the ceiling
prescribed by the Monetary Board, unless such failure or refusal to pay is based on the ground that the
claim is fraudulent.
As specified, the assured is entitled to interest on the proceeds for the duration of the delay at the rate
of twice the ceiling prescribed by the Monetary Board except when the failure or refusal of the insurer to
pay was founded on the ground that the claim is fraudulent.
D. The term "double interest" as used in the Decision of the Court of Appeals must be interpreted to
mean 24% per annum.
PRUDENTIAL assails the award of interest, granted by the Court of Appeals, in favor of TRANS-ASIA in the
assailed Decision of 6 November 2001. It is PRUDENTIAL’s stance that the award is extortionate and
grossly unsconscionable. In support thereto, PRUDENTIAL makes a reference to TRANS-ASIA’s prayer in
the Complaint filed with the court a quo wherein the latter sought, "interest double the prevailing rate of
interest of 21% per annum now obtaining in the banking business or plus 42% per annum pursuant to
Article 243 of the Insurance Code x x x."42
The contention fails to persuade. It is settled that an award of double interest is lawful and justified
under Sections 243 and 244 of the Insurance Code. 43 In Finman General Assurance Corporation v. Court
of Appeals,44 this Court held that the payment of 24% interest per annum is authorized by the Insurance
Code.45 There is no gainsaying that the term "double interest" as used in Sections 243 and 244 can only
be interpreted to mean twice 12% per annum or 24% per annum interest, thus:
The term "ceiling prescribed by the Monetary Board" means the legal rate of interest of twelve per
centum per annum (12%) as prescribed by the Monetary Board in C.B. Circular No. 416, pursuant to P.D.
No. 116, amending the Usury Law; so that when Sections 242, 243 and 244 of the Insurance Code
provide that the insurer shall be liable to pay interest "twice the ceiling prescribed by the Monetary
Board", it means twice 12% per annum or 24% per annum interest on the proceeds of the insurance. 46
E. The payment of double interest should be counted from 13 September 1996.
The Court of Appeals, in imposing double interest for the duration of the delay of the payment of the
unpaid balance due TRANS-ASIA, computed the same from 13 August 1996 until such time when the
amount is fully paid. Although not raised by the parties, we find the computation of the duration of the
delay made by the appellate court to be patently erroneous.
To be sure, Section 243 imposes interest on the proceeds of the policy for the duration of the delay at
the rate of twice the ceiling prescribed by the Monetary Board. Significantly, Section 243 mandates the
payment of any loss or damage for which an insurer may be liable, under any policy other than life
insurance policy, within thirty days after proof of loss is received by the insurer and ascertainment of the
loss or damage is made either by agreement between the insured and the insurer or by arbitration. It is
clear that under Section 243, the insurer has until the 30th day after proof of loss and ascertainment of
the loss or damage to pay its liability under the insurance, and only after such time can the insurer be
held to be in delay, thereby necessitating the imposition of double interest.
126
In the case at bar, it was not disputed that the survey report on the ascertainment of the loss was
completed by the adjuster, Richard Hoggs International (Phils.), Inc. on 13 August 1996. PRUDENTIAL had
thirty days from 13 August 1996 within which to pay its liability to TRANS-ASIA under the insurance
policy, or until 13 September 1996. Therefore, the double interest can begin to run from 13 September
1996 only.
IV.
A. An interest of 12% per annum is similarly imposed on the TOTAL amount of liability adjudged in
section III herein, computed from the time of finality of judgment until the full satisfaction thereof in
conformity with this Court’s ruling in Eastern Shipping Lines, Inc. v. Court of Appeals.
This Court in Eastern Shipping Lines, Inc. v. Court of Appeals, 47 inscribed the rule of thumb48 in the
application of interest to be imposed on obligations, regardless of their source. Eastern emphasized
beyond cavil that when the judgment of the court awarding a sum of money becomes final and
executory, the rate of legal interest, regardless of whether the obligation involves a loan or forbearance
of money, shall be 12% per annum from such finality until its satisfaction, this interim period being
deemed to be by then an equivalent to a forbearance49 of credit.
We find application of the rule in the case at bar proper, thus, a rate of 12% per annum from the finality
of judgment until the full satisfaction thereof must be imposed on the total amount of liability adjudged
to PRUDENTIAL. It is clear that the interim period from the finality of judgment until the satisfaction of
the same is deemed equivalent to a forbearance of credit, hence, the imposition of the aforesaid
interest.
Fallo
WHEREFORE, the Petition in G.R. No. 151890 is DENIED. However, the Petition in G.R. No. 151991 is
GRANTED, thus, we award the grant of attorney’s fees and make a clarification that the term "double
interest" as used in the 6 November 2001 Decision of the Court of Appeals in CA GR CV No. 68278 should
be construed to mean interest at the rate of 24% per annum, with a further clarification, that the same
should be computed from 13 September 1996 until fully paid. The Decision and Resolution of the Court
of Appeals, in CA-G.R. CV No. 68278, dated 6 November 2001 and 29 January 2002, respectively, are,
thus, MODIFIED in the following manner, to wit:
1. PRUDENTIAL is DIRECTED to PAY TRANS-ASIA the amount of P8,395,072.26, representing the balance
of the loss suffered by TRANS-ASIA and covered by Marine Policy No. MH93/1363;
2. PRUDENTIAL is DIRECTED further to PAY TRANS-ASIA damages in the form of attorney’s fees
equivalent to 10% of the amount of P8,395,072.26;
3. The aggregate amount (P8,395,072.26 plus 10% thereof as attorney’s fees) shall be imposed double
interest at the rate of 24% per annum to be computed from 13 September 1996 until fully paid; and
4. An interest of 12% per annum is similarly imposed on the TOTAL amount of liability adjudged as
abovestated in paragraphs (1), (2), and (3) herein, computed from the time of finality of judgment until
the full satisfaction thereof.
No costs.
SO ORDERED.