RULE 1

Alcantara vs. Philippine Commercial and International Bank

634 SCRA 48, G.R. No. 151349 October 20, 2010

FACTS: The petitioner, Leandro Alcantara, had been an employee of PCIB since 1974 and rose from the ranks until he
became a branch manager of the PCIB’s branch in Rizal Avenue, Manila. Prior to the present controversy, he had never
been subjected to disciplinary action by his employer.

Respondents alleged that on December 12, 1997, a certain Romy Espiritu called the office of Ms. Ana Lim of its Customer
Care reporting the alleged involvement of the petitioner with a big syndicate. 2 Certificates of Time Deposit (CTD) issued
by PCIB were allegedly being used by the syndicate in their illegal activities.

The petitioner was dismissed from employment because it was allegedly determined that the former took advantage of the
trust and confidence reposed in his position as branch manager and “falsified Bank records in order to facilitate a transaction
amounting to P538,360,000.00 that was prejudicial to the welfare and interest of the bank. Petitioner alleged that no bank
policy nor rules and regulations prohibit a Branch Manager from assisting a depositor or depositors of the bank. Nothing
was done in secrecy and CTDs were allegedly promptly cancelled owing to the failure of the clients to come up with the
money within the time frame given.

Petitioner then filed with the NLRC a complaint for illegal dismissal; illegal suspension; payment of backwages; and non-
payment of salaries/wages, allowance, separation pay, retirement benefits, service incentive leave pay, and accrued/unused
sick leave and vacation leaves against respondent. In addition, petitioner asked for the payment of moral and exemplary
damages, the suspension of his payment on his housing loan, and the return of his equity on his car loan.

The Labor Arbiter dismissed petitioner’s complaint for illegal dismissal for lack of merit and held that there was substantial
evidence that petitioner manipulated the records of respondent to facilitate the anomalous transactions of the members of
the alleged criminal syndicate.

On appeal, the NLRC affirmed the LA’s decision and thereafter denied the subsequent MR. Thus, petitioner filed a petition
for certiorari under Rule 65 of the Rules of Court with CA which was denied on account of petitioner’s failure to attach the
material portions of the records of the NLRC case, and various relevant or pertinent documents, in accordance with
paragraph 3, Section 3, Rule 46 of the 1997 Revised Rules of Civil Procedure.

ISSUE: whether or not the CA properly dismissed petitioner’s special civil action for certiorari and properly denied his
motion for reconsideration.

RULING: No. With respect to procedural question raised the Court had previously sustained that failure to attach all
pleadings and documents, by itself, is not a sufficient ground to dismiss a petition. In appropriate cases, the courts may
liberally construe procedural rules in order to meet and advance the cause of substantial justice. Lapses in the literal
observation of a procedural rule will be overlooked when they do not involve public policy, when they arose from an honest
mistake or unforeseen accident, and when they have not prejudiced the adverse party or deprived the court of its authority.
The aforementioned conditions are present in the case at bar.

However, the decision of the NLRC was sustained by the court. There was no illegal dismissal in this case. While it is true
that the rules of procedure are intended to promote rather than frustrate the ends of justice, it nevertheless must not be met
at the expense of substantial justice.

Casalla vs. People

391 SCRA 344G.R. No. 138855 October 29, 2002

FACTS: Lamberto Casalla issued 2 Bank of Commerce checks in payment of the obligation of his wife, TERESITA
CASALLA, to private respondent MILAGROS SANTOS-ESTEVANES, in order to avert court litigation. However, the
checks were dishonored by the drawee bank for reason of insufficiency of funds. Subsequently, private respondent filed two
(2) criminal complaints against petitioner for violation of the Bouncing Checks Law (BP 22) before the MTC of Pasig City.

The MTC of Pasig City convicted the accused (petitioner herein) of the crime charged on two (2) counts.
Petitioner interposed an appeal to the RTC of Pasig City and affirmed the MTC’s judgment with the modification that
appropriate subsidiary imprisonment be imposed on the accused in case of insolvency. A subsequent MR was denied on
account of the absence of a notice of hearing and because the issues raised therein have already been passed upon in its
decision.

A second MR was filed, on the other hand, private respondent filed with the RTC a motion for the issuance of a writ of
execution. The 2nd MR was denied while the motion for the issuance of a writ of execution was granted.

Petitioner interposed an appeal via a petition for review with prayer for preliminary injunction and/or TRO. The appellate
court denied the petition on the following grounds: (1) the petition did not contain a statement of material dates showing
the timeliness of the petition; (2) it was filed out of time, because the motion to reconsider the decision of the trial court did
not contain a notice of hearing. Hence, being a mere scrap of paper, it did not interrupt the period for filing the petition
before the appellate court, and the period had lapsed before the petition was filed.

Hence, the present petition, with the petitioner’s argument that the requirement of a notice of hearing does not apply to the
MR filed before RTC of Pasig City, as said court was acting only in its appellate jurisdiction, the proceedings therein being
summary in nature.

ISSUE: Is petitioner’s contention tenable?

RULING: NO. This is error, as the Rules of Court apply to all courts, except as otherwise provided by the Supreme Court.
Regional Trial Courts are not precluded from conducting hearings on matters on which the parties need to be heard, even
in the exercise of their appellate jurisdiction. The petition was denied for lack of merit.

AEDC VS DOTC

FACTS: The facts of the two cases are intertwined, both involves the controversies surrounding the NAIA Airport III
(NAIA3) project. The facts from a case named Agan v. PIATCO serves as a background. In 1993, six business leaders John
Gokongwei, Henry Sy, Sr., Lucio Tan, George Ty, and Alfonso Yuchengco met with then president FVR for a possibility
of investing the construction of a new airport terminal. They formed the company Asia’s Emerging Dragon Corp. (AEDC)
to pursue this goal. AEDC then gave an unsolicited proposal to the Gov’t through the DOTC/MIAA for the development of
NAIA3 under the Build-Operate-Transfer Law (BOT). Afterwards, DOTC created its Pre-qualification Bids and Awards
Committee (PBAC) to implement the NAIA3 project as the overseer for biddings. Afterwards, then DOTC Secretary Garcia
endorsed the proposal of AEDC to National Economic and Development Authority (NEDA), whose technical committee
eventually approved it. Afterwards, AEDC and DOTC signed a Memorandum of Understanding (MOU), which essentially
awards to AEDC the NAIA3 project, with provisions that AEDC must have a soft opening in two years. Then, DOTC
published in newspapers invitation for “competitive comparative proposals” on AEDC’s unsolicited proposal, in accordance
with a law that governs unsolicited proposals. Essentially, it required interested bidders to submit 3 separate sealed
envelopes: first on prequalification documents, second on technical proposals, and lastly on the financial proposal. Paircargo
Consortium (which eventually changed name to PIATCO, a consortium composed of People’s Air Cargo and Warehousing,
Inc., Phil. Air and Ground Services, and Security Bank Corp.) submitted their competitive proposal to PBAC. The envelopes
will be opened over a period of time, each one opened only if the previous envelope would qualify. AEDC would then
oppose each instance the sealed envelopes would be opened, citing primarily PIATCO’s dubious financial capabilities to
undergo with the project. Eventually, PBAC found PIATCO’s proposal to be more favorable to the government and required
AEDC to match its proposal. Instead, AEDC protested the undue preference given to PIATCO. Subsequently, after a series
of passes before the NEDA Investment Committee, DOTC issued a notice of award to PIATCO, and had signed a concession
agreement.

The previous case was dismissed because the parties (DOTC and AEDC) entered into a judicial compromise agreement.
AEDC filed another civil action invoking that its right was violated when the President allegedly intervened with DOTC
transactions, thus the former’s consent to settlement was vitiated by the pressure exerted by the President. DOTC filed its
comment but failed to plead and raise the defense on res judicata; thus it is deemed to have waived said defense.

The civil action was dismissed both in the trial court and in CA on the basis of res judicata.

ISSUE: WN the courts in its appellate jurisdiction may dismiss the petition on the basis of res judicata even when the
respondents failed to plead it as a defense in their comment.

RULING: SC may still motu proprio dismiss the Petition by reason thereof if it appears in the pleadings or the evidence on
record that the petition filed before it is barred by prior judgment, pursuant to Section 1 Rule 10 ROC [Defenses and
objections not pleaded. Defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed
waived. However, when it appears from the pleadings or the evidence on record that the court has no jurisdiction over the
subject matter, that there is another action pending between the same parties for the same cause, or that the action is barred
by a prior judgment or by statute of limitations, the court shall dismiss the claim].

XXX the power to dismiss provided in the abovementioned rule is among the residual prerogatives which the Court of
Appeals and even the SC may exercise by virtue of Section 2, Rule 1 of the Revised Rules of Court.

Lu v. Luym, Sr., et al
EN BANC, G.R. No. 153690

MP: Residual Powers; Where the Court En Banc entertains a case for its resolution and disposition, it does
so without implying that the Division of origin is incapable of rendering objec tive and fair justice—the action
of the Court simply means that the nature of the cases calls for en banc attention and consideration.—
In Firestone Ceramics v. Court of Appeals, 334 SCRA 465 (2000), the Court treated the consolidated cases
as En Banc cases and set the therein petitioners’ motion for oral argument, after finding that the cases
were of sufficient importance to merit the Court En Banc’s attention. It ruled that the Court’s action is
a legitimate and valid exercise of its residual power. In Limketkai Sons Milling, Inc. v. Court of
Appeals, the Court conceded that it is not infallible. Should any error of judgment be perceived, it does not
blindly adhere to such error, and the parties adversely affected thereby are not precluded from seeking
relief therefrom, by way of a motion for reconsideration. In this jurisdiction, rectification of an error, more
than anything else, is of paramount importance. x x x x It bears stressing that where, as in the present
case, the Court En Banc entertains a case for its resolution and disposition, it does so without implying
that the Division of origin is incapable of rendering objective and fair justice. The action of the Court simply
means that the nature of the cases calls for en banc attention and consideration. Neither can it be concluded
that the Court has taken undue advantage of sheer voting strength. It was merely guided by the well-
studied finding and sustainable opinion of the majority of its actual membership—that, indeed, subject
cases are of sufficient importance meriting the action and decision of the whole Court. It is, of course, beyond
cavil that all the members of this highest Court of the land are always embued with the noblest of intentions
in interpreting and applying the germane provisions of law, jurisprudence, rules and Resolutions of the
Court—to the end that public interest be duly safeguarded and rule of law be observed.

Well-entrenched doctrines or principles of law that went astray need to be steered back to their proper
course.—The Court has the power and prerogative to suspend its own rules and to exempt a case from their
operation if and when justice requires it, as in the present circumstance where movant filed a motion for
leave after the prompt submission of a second motion for reconsideration but, nonetheless, still within 15
days from receipt of the last assailed resolution. Well-entrenched doctrines or principles of law that went
astray need to be steered back to their proper course. Specifically, as David Lu correctly points out, it is
necessary to reconcile and declare the legal doctrines regarding actions that are incapable of pecuniary
estimation, application of estoppel by laches in raising an objection of lack of jurisdiction, and whether bad
faith can be deduced from the erroneous annotation of lis pendens.

FACTS: The three consolidated cases stemmed from the complaint for “Declaration of Nullity of Share Issue, Receivership
and Dissolution” filed on August 14, 2000 before the RTC of Cebu City by David Lu, et al. against Paterno Lu Ym, Sr. and
sons (Lu Ym father and sons) and LLDC.

By Decision of March 1, 2004, Branch 12 of the RTC ruled in favor of David et al. by annulling the issuance of the shares
of stock subscribed and paid by Lu Ym father and sons at less than par value, and ordering the dissolution and asset
liquidation of LLDC. The appeal of the trial court’s Decision remains pending with the appellate court.

Several incidents arising from the complaint reached the Court through the present three petitions.

David, et al. assailed the appellate court’s resolutions dismissing their complaint for its incomplete signatory in the
certificate of non-forum shopping and consequently annulling the placing of the subject corporation under
receivership pendente lite, the Court, found the issue to have been mooted by the admission by the trial court of David et
al.’s Amended Complaint, filed by them pursuant to the trial court’s order to conform to the requirements of the Interim
Rules of Procedure Governing Intra-Corporate Controversies.

Since an amended pleading supersedes the pleading that it amends, the original complaint of David, et al. was deemed
withdrawn from the records.

The Court noted that both parties admitted the mootness of the issue and that the trial court had already rendered a decision
on the merits of the case. It added that the Amended Complaint stands since Lu Ym father and sons availed of an improper
mode (via an Urgent Motion filed with this Court) to assail the admission of the Amended Complaint.

Hence, this clarification before the court is sought.

ISSUE: WON the the action for collection of legal fees during the period of appeal applicable in cases formerly cognizable
by the Securities and Exchange Commission

RULING: The nature of the above mentioned cases should first be ascertained. Section 3(a), Rule 1 of the 1997 Rules of
Civil Procedure defines civil action as one by which a party sues another for the enforcement or protection of a right, or the
prevention or redress of a wrong. It further states that a civil action may either be ordinary or special, both being governed
by the rules for ordinary civil actions subject to the special rules prescribed for special civil actions. Section 3(c) of the same
Rule, defines a special proceeding as a remedy by which a party seeks to establish a status, a right, or a particular fact.

Applying these definitions, the cases covered by the Interim Rules for Intra-Corporate Controversies should be
considered as ordinary civil actions. These cases either seek the recovery of damages/property or specific
performance of an act against a party for the violation or protection of a right. These cases are:

(1) Devices or schemes employed by, or any act of, the board of directors, business associates, officers or partners,
amounting to fraud or misrepresentation which may be detrimental to the interest of the public and/or of the
stockholders, partners, or members of any corporation, partnership, or association;
 (2) Controversies arising out of intra-corporate, partnership, or association relations, between and among stockholders,
members or associates; and between, any or all of them and the corporation, partnership, or association of which they
are stockholders, members or associates, respectively;
(3) Controversies in the election or appointment of directors, trustees, officers, or managers of corporations,
partnerships, or associations;
(4) Derivative suits; and
(5) Inspection of corporate books.

On the other hand, a petition for rehabilitation, the procedure for which is provided in the Interim Rules of Procedure on
Corporate Recovery, should be considered as a special proceeding. It is one that seeks to establish the status of a party or a
particular fact. As provided in section 1, Rule 4 of the Interim Rules on Corporate Recovery, the status or fact sought to be
established is the inability of the corporate debtor to pay its debts when they fall due so that a rehabilitation plan, containing
the formula for the successful recovery of the corporation, may be approved in the end. It does not seek a relief from an
injury caused by another party.

Section 7 of Rule 141 (Legal Fees) of the Revised Rules of Court lays the amount of filing fees to be assessed for actions
or proceedings filed with the Regional Trial Court. Section 7(a) and (b) apply to ordinary civil actions while 7(d) and (g)
apply to special proceedings.

In fine, the basis for computing the filing fees in intra-corporate cases shall be section 7(a) and (b) l & 3 of Rule
141. For petitions for rehabilitation, section 7(d) shall be applied.” (emphasis and underscoring supplied)

Heirs of Guido and Isabel Yaptinchay vs. Del Rosario

304 SCRA 18, G.R. No. 124320 March 2, 1999

FACTS: Petitioners are the legal heirs of the late Guido and Isabel Yaptinchay, the owners-claimants of Lot No. 1131
situated in Carmona, Cavite. Petitioners discovered that a portion, if not all, of the aforesaid properties were titled in the
name of respondent Golden Bay Realty and Development Corporation (Golden Bay) under Transfer Certificate of Title
Nos. 225254 and 225255. They filed a complaint for annulment and/or declaration of nullity of TCT Nos. 493363-67 and
its derivatives and as alternative reconveyance of realty with prayer for writ of preliminary injunction and/or restraining
order with damages with the Regional Trial Court in Imus, Cavite. Private respondents presented a motion to dismiss on the
grounds that the complaint failed to state a cause of action and that petitioners did not have a right of action, that they have
not established their status as heirs and that the land being claimed is different from that of the private respondents. The said
motion to dismiss was granted by the respondent court holding that petitioners have not shown any proof or even a
semblance of it except the allegations that they are the legal heirs of the deceased couple. Petitioners interposed a motion
for reconsideration but it was denied hence, the present petition. Petitioners contended that the respondent court acted with
grave abuse of discretion in ruling that the issue of heirship should first be determined before the trial of the case could
proceed.

ISSUE: Whether or not respondent court should have proceeded with the trial and simultaneously resolved the issue of
heirship in the same case.

RULING: No. The Court ruled that the trial court cannot make a declaration of heirship in the civil action for the reason
that such a declaration can only be made in a special proceeding. Under Section 3, Rule 1 of the 1997 Revised Rules of
Court, a civil action is defined as “one by which a party sues another for the enforcement or protection of a right, or the
prevention or redress of a wrong” while a special proceeding is “a remedy by which a party seeks to establish a status, a
right, or a particular fact.” It is then decisively clear that the declaration of heirship can be made only in a special proceeding
inasmuch as the petitioners here are seeking the establishment of a status or right.

Heirs of Marcelino Doronio v. Heirs of Fortunato Doronio (2007)

FACTS: Spouses Simeon Doronio and Cornelia Gante, now both deceased, were the registered owners of a parcel of land
located at Asingan, Pangasinan covered by Original Certificate of Title (OCT) No. 352. Marcelino Doronio and Fortunato
Doronio, now both deceased, were among their children and herein represented by their heirs, petitioners and respondents
respectively.

In 1919, a private deed of donation propter nuptias was executed by spouses Simeon Doronio and Cornelia Gante in
favor of Marcelino Doronio and the latter’s wife on the subject property which was occupied by both parties for several
decades. Petitioners now claim ownership of the land in view of the private deed of donation propter nuptias in favor of
their predecessors, Marcelino Doronio and wife.

Respondents, on the other hand, contends that they acquired one-half of the property covered by OCT No. 352 by tradition
and/or intestate succession; that the deed of donation was null and void; that assuming that the deed of donation was valid,
only one-half of the property was actually donated to Marcelino Doronio and Veronica Pico; and that respondents acquired
ownership of the other half portion of the property by acquisitive prescription and that the subject land is different from
what was donated as the descriptions of the property under OCT No. 352 and under the private deed of donation were
different.
Petitioners filed before RTC in Urdaneta, Pangasinan a petition "For the Registration of a Private Deed of Donation".
Petition was granted and TCT 4481 issued to petitioners. Respondent’s MR denied. Respondents, in turn, filed an action for
reconveyance and damages with prayer for preliminary injunction against petitioner. RTC ruled in favor of petitioner heirs
of Marcelino Doronio. CA reversed RTC( CA reveres favors the son to have half of the share). Hence, this petition with
petitioners contending that the RTC no jurisdiction to hear the case since issues on Impairment of Legitime Should Be
Threshed Out in a Special Proceeding, Not in Civil Action for Reconveyance and Damages.

ISSUE: Whether or not issue on Impairment of Legitime Should properly be threshed out in Civil Action for
Reconveyance and Damages thus within the jurisdiction of RTC.

RULING: No. Issue regarding the impairment of legitime of Fortunato Doronio must be resolved in an action for the
settlement of estates of spouses Simeon Doronio and Cornelia Gante. It may not be passed upon in an action for
reconveyance and damages. A probate court, in the exercise of its limited jurisdiction, is the best forum to ventilate
and adjudge the issue of impairment of legitime as well as other related matters involving the settlement of estate.

An action for reconveyance with damages is a civil action, whereas matters relating to settlement of the estate of a deceased
person such as advancement of property made by the decedent, partake of the nature of a special proceeding. Special
proceedings require the application of specific rules as provided for in the Rules of Court.

Under Section 2, Rule 90 of the Rules of Court, questions as to advancement made or alleged to have been made by the
deceased to any heir may be heard and determined by the court having jurisdiction of the estate proceedings, and the final
order of the court thereon shall be binding on the person raising the questions and on the heir. While it may be true that the
Rules used the word "may," it is nevertheless clear that the same provision contemplates a probate court when it speaks of
the "court having jurisdiction of the estate proceedings ." Corollarily, the Regional Trial Court in the instant case, acting
in its general jurisdiction, is devoid of authority to render an adjudication and resolve the issue of advancement of
the real property.

Before any conclusion about the legal share due to a compulsory heir may be reached, it is necessary that certain steps be
taken first.43 The net estate of the decedent must be ascertained, by deducting all payable obligations and charges from the
value of the property owned by the deceased at the time of his death; then, all donations subject to collation would be added
to it. With the partible estate thus determined, the legitime of the compulsory heir or heirs can be established; and only then
can it be ascertained whether or not a donation had prejudiced the legitimes.

HELD:
The trial court cannot make a declaration of heirship in the civil action for the reason that such a
declaration can only be made in a special proceeding. Under Section 3, Rule 1 of the 1997 Revised
Rules of Court, a civil action is defined as “one by which a party sues another for the enforcement
or protection of a right, or the prevention or redress of a wrong” while a special proceeding is “a
remedy by which a party seeks to establish a status, a right, or a particular fact.” It is then
decisively clear that the declaration of heirship can be made only in a special proceeding inasmuch
as the petitioners here are seeking the establishment of a status or right.
We therefore hold that the respondent court did the right thing in dismissing the Second
Amended Complaint, which stated no cause of action. In Travel Wide Associated Sales (Phils.), Inc.
v. Court of Appeals, it was ruled that:
11

“x x x If the suit is not brought in the name of or against the real party in interest, a motion to dismiss may
be filed on the ground that the complaint states no cause of action.”

WHEREFORE, for lack of merit, the Petition under consideration is hereby DISMISSED. No
pronouncement as to costs.
SO ORDERED.

Natcher v. CA (2001)

FACTS: Spouses Graciano del Rosario and Graciana Esguerra were registered owners of a parcel of land. Upon the death
of Graciana in 1951, Graciano, together with his six children, entered into an extrajudicial settlement of Graciana's estate
adjudicating and dividing among themselves the mentioned real property. In 1980, Graciano married herein petitioner
Patricia Natcher. During their marriage, Graciano sold the land covered by TCT No. 107443 to his wife Patricia as a
result of which TCT No. 1860594 was issued in the latter's name. On 1985, Graciano died leaving his second wife Patricia
and his six children by his first marriage, as heirs. The private respondents filed a civil case against the petitioner before
RTC Manila. They alleged that upon Graciano's death, petitioner Natcher, through the employment of fraud,
misrepresentation and forgery, acquired TCT No. 107443, by making it appear that Graciano executed a Deed of
Sale in favor herein petitioner resulting in the cancellation of TCT No. 107443 and the issuance of TCT no. 186059
in the name of Patricia Natcher. Similarly, herein private respondents alleged in said complaint that as a consequence of
such fraudulent sale, their legitimes have been impaired.
The RTC ruled deed of sale executed by the late Graciano del Rosario in favor of Patricia Natcher is prohibited by law
and thus a complete nullity as there is no evidence that a separation of property was agreed upon in the marriage settlements
or that there has been decreed a judicial separation of property between them, the spouses are prohibited from entering into
a contract of sale; thus it was not a valid donation. However, it can be regarded as an extension of advance inheritance of
Patricia Natcher being a compulsory heir of the deceased.

On appeal, the CA set aside the RTC’s decision and stated that 1) it is a probate court that has exclusive jurisdiction to
make a just and legal distribution of the estate; and 2) trying an ordinary action for reconveyance / annulment of title, went
beyond its jurisdiction when it performed the acts proper only in a special proceeding for the settlement of estate of a
deceased person.

Questioning the CA’s decision Natcher appealed through Rule 45 the decision of the CA in dismissing the case as it should
have been a probate court and not an ordinary court deciding the estate.

ISSUE: May a Regional Trial Court, acting as a court of general jurisdiction in an action for reconveyance annulment of
title with damages, adjudicate matters relating to the settlement of the estate of a deceased person particularly on questions
as to advancement of property made by the decedent to any of the heirs?

RULING: No. The court ruled that an action for reconveyance and annulment of title with damages is a civil action, whereas
matters relating to settlement of the estate of a deceased person such as advancement of property made by the decedent,
partake of the nature of a special proceeding, which concomitantly requires the application of specific rules as provided for
in the Rules of Court. Matters which involve settlement and distribution of the estate of the decedent fall within the exclusive
province of the probate court in the exercise of its limited jurisdiction. Thus, under Section 2, Rule 90 of the Rules of Court,
questions as to advancement made or alleged to have been made by the deceased to any heir may be heard and determined
by the court having jurisdiction of the estate proceedings; and the final order of the court thereon shall be binding on the
person raising the questions and on the heir. In the case at hand, RTC is acting in its general jurisdiction is devoid of authority
to render an adjudication and resolve the issue of advancement of the real property in favor of herein petitioner. Moreover,
the RTC of Manila, Branch 55 was not properly constituted as a probate court so as to validly pass upon the question of
advancement made by the decedent Graciano Del Rosario to his wife, herein petitioner Natcher.

Moreover, there lies a marked distinction between an action and a special proceeding. An action is a formal demand of one's
right in a court of justice in the manner prescribed by the court or by the law. It is the method of applying legal remedies
according to definite established rules. The term "special proceeding" may be defined as an application or proceeding to
establish the status or right of a party, or a particular fact. Usually, in special proceedings, no formal pleadings are required
unless the statute expressly so provides. In special proceedings, the remedy is granted generally upon an application or
motion.

Ramos v. Ramos (2003)

FACTS: Petitioners are children of the late Paulino V. Chanliongco Jr., who was the co-owner of a parcel of land known
as Lot No. 2-G situated in Tondo, Manila. It was co-owned by him, his sister Narcisa, and his brothers Mario and Antonio.
By virtue of a Special Power of Attorney executed by the co-owners in favor of Narcisa, her daughter Adoracion C. Mendoza
had sold the lot to herein respondents. Because of conflict among the heirs of the co-owners as to the validity of the sale,
respondents filed with the RTC a Complaint for interpleader to resolve the various ownership claims.

RTC: upheld the sale insofar as the share of Narcisa was concerned. It ruled that Adoracion had no authority to sell the
shares of the other co-owners, because the Special Power of Attorney had been executed in favor only of her mother,
Narcisa.

CA: modified the ruling of the RTC. It held that while there was no Special Power of Attorney in favor of Adoracion, the
sale was nonetheless valid, because she had been authorized by her mother to be the latter’s sub-agent. There was
thus no need to execute another special power of attorney in her favor as sub-agent. This CA Decision was not appealed,
became final and was entered in favor of respondents on August 8, 1996.

Later on, petitioners filed with the CA a Motion to Set Aside the Decision. They contended that they had not been served
a copy of either the Complaint or the summons. Neither had they been impleaded as parties to the case in the RTC.
As it was, they argued, the CA Decision should be set aside because it adversely affected their respective shares in the
property without due process.

In denying the Motion of petitioners, the CA cited the grounds raised in respondents Opposition: (a) the Motion was not
allowed as a remedy under the 1997 Rules of Civil Procedure; (b) the Decision sought to be set aside had long become final
and executory; (c) the movants did not have any legal standing; and (d) the Motion was purely dilatory and without merit.
Hence, this Petition.

ISSUE: Whether the decision of the CA is void for failing to implead and to serve summons upon petitioners.

RULING: No. The Complaint was brought against the deceased registered co-owners: Narcisa, Mario, Paulino and Antonio
Chanliongco, as represented by their respective estates. Clearly, petitioners were not the registered owners of the land, but
represented merely an inchoate interest thereto as heirs of Paulino. They had no standing in court with respect to actions
over a property of the estate, because the latter was represented by an executor or administrator. Thus, there was no need to
implead them as defendants in the case, inasmuch as the estates of the deceased co-owners had already been made parties.
Petitioner Florencio D. Chanliongco, on the other hand, was impleaded in the Complaint, but not served summons. However,
the service of summons upon the estate of his deceased father was sufficient, as the estate appeared for and on behalf of all
the beneficiaries and the heirs of Paulino Chanliongco, including Florencio.

We also note that the counsel of petitioners, Atty. Felino V. Quiming Jr., is a partner of the law firm that represented the
estate of the deceased father. Hence, it can reasonably be expected that the service upon the law firm was sufficient notice
to all the beneficiaries of the estate, including Petitioner Florencio D. Chanliongco.

Note: An action in personam is lodged against a person based on personal liability; an action in rem is directed against the
thing itself instead of the person; while an action quasi in rem names a person as defendant, but its object is to subject that
persons interest in a property to a corresponding lien or obligation.

Navarosa v. COMELEC (2003)

FACTS: : Petitioner Charito Navarosa and respondent Roger M. Esto were candidates for mayor of Libacao, Aklan in the
14 May 2001 elections. On 17 May 2001, the COMELEC Municipal Board of Canvassers of Libacao proclaimed petitioner
Navarosa as the duly elected mayor, with a winning margin of three (3) votes over respondent Esto. Claiming that
irregularities marred the canvassing of ballots in several precincts, respondent Esto filed an election protest docketed as
Election Case No. 129 in the Regional Trial Court, Branch 9, Kalibo, Aklan. Petitioner Navarosa, who also claimed that
canvassing irregularities prejudiced her, filed a counter-protest in the same case.

On 4 March 2002, after revision of the contested ballots, the trial court rendered judgment in favor of respondent Esto.
Petitioner Navarosa appealed the trial court’s ruling to the COMELEC. Respondent Esto, on the other hand, filed with
the trial court a motion for execution of the judgment pending petitioner Navarosas appeal. Petitioner Navarosa opposed
respondent Estos motion. In the alternative, petitioner Navarosa offered to file a supersedeas bond to stay execution pending
appeal, should the trial court grant respondent Estos motion.

In its Resolution dated 28 November 2002, the COMELEC Second Division affirmed the trial court’s Order granting
execution pending appeal and nullified the stay of the execution. The Second Division also found that respondent Esto duly
paid the COMELEC filing fee. Petitioner Navarosa sought reconsideration of this ruling but the COMELEC En Banc denied
her motion on 15 April 2003. Hence, this petition.

ISSUE: Whether COMELEC en banc acted with grave abuse of discretion amounting to lack or excess of jurisdiction when
it affirmed the Resolution of the COMELEC second division when the latter ruled that the trial court had no power to
order the stay of execution of its decision pending appeal in an election contest, because section 3, rule 39 of the
Revised Rules of Court does not apply to election cases.

RULING: No. Unlike the Election Code of 1971, which expressly provided for execution pending appeal of trial court’s
rulings in election protests, the present election laws are silent on such remedy. Nevertheless, Section 2, Rule 39 of the
Rules of Court (now 1997 Rules of Civil Procedure) applies in suppletory character to election cases, thus allowing
execution pending appeal in the discretion of the court.

The Omnibus Election Code of the Philippines (B.P. Blg. 881) and the other election laws do not specifically provide for
execution pending appeal of judgment in election cases, unlike the Election Code of 1971 whose Section 218 made express
reference to the Rules of Court on execution pending appeal The failure of the extant election laws to reproduce Section
218 of the Election Code of 1971 does not mean that execution of judgment pending appeal is no longer available in election
cases. In election contests involving elective municipal officials, which are cognizable by courts of general jurisdiction;
and those involving elective barangay officials, which are cognizable by courts of limited jurisdiction, execution of judgment
pending appeal under Section 2 of Rule 39 of the Rules of Court are permissible pursuant to Rule 143 of the Rules of Court,
which is now Section 4, Rule 1 of the 1997 Rules of Civil Procedure.

In insisting that the simple expedient of posting a supersedeas bond can stay execution pending appeal, petitioner Navarosa
neither claims nor offers a more compelling contrary policy consideration. Instead, she merely contends that Section 3 of
Rule 39 applies also in a suppletory character because its Siamese twin provision, Section 2, is already being so applied.
Such simplistic reasoning both ignores and negates the public interest underlying Section 2’s application. We cannot
countenance such argument.

The bond thus given may be proceeded against on motion with notice to the surety. Consequently, it finds no application in
election protest cases where judgments invariably include orders which are not capable of pecuniary estimation such as the
right to hold office and perform its functions.

Furthermore, a supersedeas bond under Section 3 cannot fully protect the interests of the prevailing party in election protest
cases. A supersedeas bond secures the performance of the judgment or order appealed from in case of its affirmation. Section
3 finds application in ordinary civil actions where the interest of the prevailing party is capable of pecuniary estimation, and
consequently, of protection, through the filing of a supersedeas bond. Thus, the penultimate sentence of Section 3 states:
The bond thus given may be proceeded against on motion with notice to the surety. Consequently, it finds no application in
election protest cases where judgments invariably include orders which are not capable of pecuniary estimation such as the
right to hold office and perform its functions

As applied to the present case, the supersedeas bond petitioner Navarosa filed can only answer for that portion of the trial
court’s ruling ordering her to pay to respondent Esto actual damages, attorneys fees and the cost of the suit. It cannot secure
execution of that portion proclaiming respondent Esto duly elected mayor of Libacao, Aklan by popular will of the electorate
and authorizing him to assume the office. This anomalous situation defeats the very purpose for the filing of the supersedeas
bond in the first place.

In sum, the Court holds that the COMELEC did not commit grave abuse of discretion in ordering execution pending appeal
of the trial court’s decision. Grave abuse of discretion implies capricious and whimsical exercise of judgment amounting to
lack of jurisdiction, or arbitrary and despotic exercise of power because of passion or personal hostility. The grave abuse of
discretion must be so patent and gross as to amount to an evasion or refusal to perform a duty enjoined by law. This does
not obtain in the present case.

Monsanto v. Lim (2014)

FACTS: Flordelis Menzon, Regional Director of the Home Development Mutual Fund (Pag-IBIG), requested the
intervention of Executive Judge Monsanto of the Regional Trial Court of Catbalogan, Samar on the alleged anomalous
auction sale conducted by Sheriff IV Lorenzo De Guzman. According to Pag-IBIG, De Guzman previously acceded to its
request to move the date of the auction sale to January 20, 2004; however, to its surprise, the sale proceeded as originally
scheduled on January 15, 2004. Pag-IBIG also claimed that the winning bid of Leoncio Lim in the amount of P500,000.00
was grossly disadvantageous to the government considering that the outstanding loan obligations of the mortgagor,
Eduardo Monsanto, was more than the bid amount. Executive Judge Monsanto refrained from acting on the letter
considering that Eduardo is his relative; instead he re-assigned the same to Judge Usman.

RTC conducted a hearing; Atty. Cesar Lee argued on behalf of Pag-IBIG; and Pascual Monsanto appeared on behalf of
Eduardo. Judge Usman noted that no formal petition or complaint was actually filed which presents a judicial issue;
moreover, the acts complained of partake of administrative matter. Consequently, Judge Usman referred the matter to the
Office of the Court Administrator for further action. Pascual filed with the OCA a Motion to Lift Writ of Execution and
Notice to Vacate. The OCA directed Judge Usman to conduct an investigation and take action on the ‘Motion to Lift Writ
of Execution and Notice to Vacate.’

Pag-IBIG informed the trial court that the loan of Eduardo had been restructured and that Eduardo had commenced paying
monthly amortizations; that as a result of the restructuring, Pag-IBIG is withdrawing its Petition for Extra-judicial
Foreclosure; and that it is no longer interested in pursuing an administrative action against De Guzman. Leoncio opposed
Pag-IBIG’s manifestation. Leoncio filed a Manifestation with Ex-Parte Motion for Issuance of Writ of Possession claiming
that the reglementary period had elapsed without Eduardo redeeming the subject property; as such, he is already entitled to
the issuance of a writ of possession.

RTC finds that the instant motion to lift writ of execution and notice to vacate the premises is devoid of merit, hence denied.
The motion for issuance of writ of possession filed by Leoncio Lim through counsel Atty. Labid being meritorious is hereby
ordered GRANTED, hence let a writ of possession be issued immediately in favor of Mr. Leoncio Lim purchaser in good
faith.

CA found no grave abuse of discretion on the part of the RTC.

ISSUE: Whether the RTC acquired jurisdiction over the case.

RULING: No. Filing the appropriate initiatory pleading and the payment of the prescribed docket fees vest a trial court
with jurisdiction over the subject matter.” Section 5, Rule 1 of the Rules of Court specifically provides that “a civil action
is commenced by the filing of the original complaint in court.” Moreover, “every ordinary civil action must be based on a
cause of action.”

In this case, records show that no formal complaint or petition was filed in court. There being no proper initiatory pleading
filed, then the RTC Branch 28 did not acquire jurisdiction over the matter/case. We have also noted that no docket fees were
paid before the trial court. Section 1, Rule 141 of the Rules of Court mandates that “upon the filing of the pleading or other
application which initiates an action or proceeding, the fees prescribed therefor shall be paid in full.” “It is hornbook law
that courts acquire jurisdiction over a case only upon payment of the prescribed docket fee.” Since no docket or filing fees
were paid, then the RTC Branch 28 did not acquire jurisdiction over the matter/case. It therefore erred in taking cognizance
of the same. Consequently, all the proceedings undertaken by the trial court are null and void, and without force and effect.

All proceedings, processes and writs emanating therefrom are likewise NULLIFIED and VOIDED for lack of jurisdiction.

Ingles vs. Honorable Estrada

*Proceedings for the extrajudicial foreclosure of mortgages, as the name already suggests, are not suits filed in a court.
They are commenced not by the filing of a complaint, but by submitting an application before an executive judge who, in
turn, receives the same neither in a judicial capacity nor on behalf of the court. The conduct of such proceedings is not
governed by the rules on ordinary or special civil actions, but by Act No. 3135, as amended, and by special administrative
orders issued by this Court. Hence, they are not civil actions.

FACTS: Spouses Jose and Josefina Ingles were the registered owners of a 2,265 square meter parcel of land in Quezon
City per TCT. They obtained a loan in the amount of P6,200,000.00 from respondent Charles J. Esteban. As collateral for
such loan, Jose and Josefina mortgaged their above-described land in favor of Charles. A Deed of Real Estate Mortgage was
then executed. The Deed, however, contained a stipulation that upon the failure of the MORTGAGOR/S [Jose and
Josefina] to pay their loan at maturity date the MORTGAGOR/S [Jose and Josefina] may elect or choose to foreclose
the mortgage judicially or extra-judicially.

Upon maturity of their loan the spouse, despite the extension given by Charles, still failed to pay.Hence Charles
petitioned Executive Judge Estrella T. Estrada of the RTC of Quezon City for the extrajudicial foreclosure of the mortgage
in his favour. This was granted by an order dated 8 October 1997 by EJ Estrada. Against such Order, the Ingleses filed a
motion for reconsideration but was denied. At the public auction, Charles was declared the highest bidder and was granted
a Certificate of Sale.

On 17 December 1999, the Ingleses filed before the Court of Appeals a petition for Annulment of Final Orders.

The Court of Appeals dismissed the petition for Annulment of Final Orders on the ground of lack of jurisdiction. The Court
of Appeals pointed out that the petition for Annulment of Final Orders assails orders issued by an executive judge in a
proceeding merely for the extrajudicial foreclosure of a mortgage whereas the Rules of Court 48clearly prescribes that only
judgments, final orders and resolutions issued by a “Regional Trial Court” in “civil actions” may be the subject of annulment
under Rule 47.

Unconvinced, the Ingleses appealed both Resolutions of the Court of Appeals before this Court by certiorari. They posit
that the assailed Orders of Executive Judge Estrada may, in view of their peculiar nature, be treated as final orders issued
in a “civil action” by a “Regional Trial Court” itself.104

ISSUE: Whether the Court of Appeals erred in dismissing the Ingleses’ petition for Annulment of Final Orders.

HELD: NO. Section 9(2) of Batas Pambansa Blg. 129 or the Judiciary Reorganization Act of 1980, vests the Court of
Appeals with exclusive original jurisdiction over actions for “annulment of judgments of Regional Trial Courts.” The
remedy by which such jurisdiction may be invoked is provided under Rule 47 of the Rules of Court which section sets forth
in no unclear terms that only judgments, final orders and resolutions in “civil actions” of “Regional Trial Courts” may be
the subject of a petition for annulment before the Court of Appeals.

Now, are Proceedings for the Extrajudicial Foreclosure of Mortgages a Civil Action?

No, Proceedings for the Extrajudicial Foreclosure of Mortgages are not Civil Actions.

“Civil actions” are suits filed in court involving either the enforcement or protection of a right, or the prevention or redress
of a wrong. They are commenced by the filing of an original complaint before an appropriate court and their proceedings
are governed by the provisions of the Rules on Court on ordinary or special civil actions. Civil actions are adversarial in
nature; presupposing the existence of disputes defined by the parties that are, in turn, submitted before the court for
disposition. Issuances made therein, including and most especially judgments, final orders or resolutions, are therefore
rendered by courts in the exercise of their judicial function.

In contrast, proceedings for the extrajudicial foreclosure of mortgages, as the name already suggests, are not suits filed in a
court. They are commenced not by the filing of a complaint, but by submitting an application before an executive judge
who, in turn, receives the same neither in a judicial capacity nor on behalf of the court. The conduct of such proceedings is
not governed by the rules on ordinary or special civil actions, but by Act No. 3135, as amended, and by special administrative
orders issued by this Court. Proceedings for the extrajudicial foreclosure of mortgages are also not adversarial; as the
executive judge merely performs therein an administrative function to ensure that all requirements for the extrajudicial
foreclosure of a mortgage are satisfied before the clerk of court, as the ex-officio sheriff, goes ahead with the public auction
of the mortgaged property. Necessarily, the orders of the executive judge in such proceedings, whether they be to allow or
disallow the extrajudicial foreclosure of the mortgage, are not issued in the exercise of a judicial function but, in the words
of First Marbella Condominium Association, Inc. v. Gatmaytan:

Verily, the Orders of Executive Judge Estrada cannot be the subject of a petition for annulment before the Court of
Appeals. Such orders, issued as they were by an executive judge in connection with a proceeding for the extrajudicial
foreclosure of a mortgage, evidently do not fall within the type of issuances so carefully identified under Section 1 of Rule
47. The Court of Appeals was, therefore, correct in postulating that the annulment of the assailed Orders is not within their
exclusive original jurisdiction per Section 9(2) of Batas Pambansa Blg. 129.

ILASCO v. CA
*Before procedural rules can be relaxed to give way to substantive justice, it is implicit that such liberality be applied in a
proper case.

FACTS: Sometime in 1980, respondent Rodillo commenced with the CFI of Valenzuela, Bulacan, to declare null and void
the donation given to petitioners Luis Ilasco and Rosario dela Cruz by Cipriano Rodillo and Victoria dela Cruz and the
reconveyance of the one-half portion of the same to respondent Rodillo.

Finding difficulty in serving the summonses on petitioners Ilasco and dela Cruz, who were residents of the United States,
respondent Rodillo filed a Motion for Leave to Archive Case dated August 6, 1980. The Court of First Instance of
Valenzuela, Bulacan, issued an order dated August 8, 1980 approving the motion.

On October 2, 1981, respondent Rodillo filed an Ex-Parte Motion to Revive Case which was granted by the trial court on
October 13, 1981. As no further action was taken by respondent Maria Clara Rodillo, petitioners Ilasco and dela Cruz filed
a Motion to Dismiss and for Cancellation of Notice of Lis Pendens. The motion was granted in an order dated March 27,
1982.

Respondent Rodillo filed a Motion for Reconsideration, which was denied on April 29, 1982. No appeal was taken from
the Orders dated March 27, 1982 and April 29, 1982. Instead, on March 9, 1983, respondent Rodillo commenced in the
Regional Trial Court, Bulacan.

Petitioners Ilasco and dela Cruz moved for the dismissal of the case against them on the ground of res judicata. The
motion was granted.

The Court of Appeals reversed the decision of the trial court and reinstated the complaint, holding that while all the elements
of res judicata were present such principle was inapplicable to the case, considering the “environmental circumstances”
thereof. By “environmental circumstances,” the Court of Appeals meant the utter dependence of respondent Rodillo on her
counsel and the failure to prosecute the case due to the failure to summon the defendants, who were residing abroad.

In pertinent part, the decision of the Court of Appeals states: “Res judicata is to be disregarded if its application would
involve the sacrifice of justice to technicality.

ISSUE: W/N The respondent court erred in not applying the doctrine of res judicata despite its own finding that all the
elements of said doctrine are present in the instant case;

HELD: YES. The Court of Appeals fell into error because of its wrong appreciation of the issue before it. The issue was
whether the Order dated March 27, 1982 of the Court of First Instance of Valenzuela, Bulacan in Civil Case No. 1120-V-
80 operated as res judicata to Civil Case No. 6779-M. What the Court of Appeals resolved was the question of whether the
trial court erred in dismissing Civil Case No. 1120-V-80 without stating that the dismissal was “without prejudice.” Invoking
the rule that justice should not be sacrificed to technicality, the Court of Appeals set aside the Order of the dismissal dated
March 27, 1982 and the Order dated April 27, 1982, denying the motion for reconsideration in Civil Case No. 1120-V-80.

The Court of Appeals would have been correct if the plaintiff (private respondent herein) in Civil Case No. 1120-V-80 had
timely appealed the Order of dismissal dated March 27, 1982 and raised the issue that the trial court had gravely abused its
discretion in dismissing the case with prejudice in view of the “environmental circumstances” of the case.

Before procedural rules can be relaxed to give way to substantive justice, it is implicit that such liberality be applied in a
proper case.

WHEREFORE, the decision of the Court of Appeals appealed from is SET ASIDE. A new judgment is rendered
REINSTATING and AFFIRMING the Orders dated March 27, 1982 and April 29, 1982 of the Regional Trial Court, Branch
XVI, Malolos, Bulacan in Civil Case No. 6779-M.

REPUBLIC vs HERNANDEZ

*The situation presented in this case does not warrant exception from the Rules under the policy of liberal construction
thereof in general, and for change of name in particular, as proposed by private respondents and adopted by respondent
judge. Liberal construction of the Rules may be invoked in situations wherein there may be some excusable formal deficiency
or error in a pleading, provided that the same does not subvert the essence of the proceeding and connotes at least a
reasonable attempt at compliance with the Rules. Utter disregard of the Rules cannot justly be rationalized by harking on
the policy of liberal construction.

FACTS: PETITION for certiorari to review a decision of the Regional Trial Court of Pasig City, Br. 158.
On March 10, 1994, herein private respondent spouses, Van Munson y Navarro and Regina Munson y Andrade, filed a
petition2 to adopt the minor Kevin Earl Bartolome Moran. In the very same petition, private respondents prayed for the
change of the first name of said minor adoptee to Aaron Joseph.

At the hearing on April 18, 1994, petitioner opposed the inclusion of the relief for change of name in the same petition for
adoption. In its formal opposition dated May 3, 1995,4 petitioner reiterated its objection to the joinder of the petition for
adoption and the petitions for change of name in a single proceeding, arguing that these petition should be conducted and
pursued as two separate proceedings.

After considering the evidence and arguments of the contending parties, the trial court ruled in favor of herein private
respondents.

Petitioner insists on strict adherence to the rule regarding change of name in view of the natural interest of the State in
maintaining a system of identification of its citizens and in the orderly administration of justice.14 Private respondents argue
otherwise and invoke a liberal construction and application of the Rules, the welfare and interest of the adoptee being the
primordial concern that should be addressed in the instant proceeding.

ISSUE: Whether or not the court a quo erred in granting the prayer for the change of the registered proper or given name
of the minor adoptee embodied in the petition for adoption.

HELD: As keenly observed and correctly pointed out by the Solicitor General—
“A petition for adoption and a petition for change of name are two special proceedings which, in substance and purpose, are
different from each other.

The situation presented in this case does not warrant exception from the Rules under the policy of liberal construction
thereof in general, and for change of name in particular, as proposed by private respondents and adopted by respondent
judge. Liberal construction of the Rules may be invoked in situations wherein there may be some excusable formal
deficiency or error in a pleading, provided that the same does not subvert the essence of the proceeding and connotes at
least a reasonable attempt at compliance with the Rules. Utter disregard of the Rules cannot justly be rationalized by harking
on the policy of liberal construction.

By reason thereof, the only way that the name of person can be changed legally is through a petition for change of name
under Rule 103 of the Rules of Court. As earlier mentioned, a petition for change of name being a proceeding in rem,
impressed as it is with public interest, strict compliance with all the requisites therefor in order to vest the court with
jurisdiction is essential, and failure therein renders the proceedings a nullity.52

WHEREFORE, on the foregoing premises, the assailed order of respondent judge is hereby MODIFIED. The legally
adopted child of private respondents shall henceforth be officially known as Kevin Earl Munson y Andrade unless a change
thereof is hereafter effected in accordance with law. In all other respects, the order is AFFIRMED.

El Reyno Homes, Inc. vs. Ong

*In not a few instances, we relaxed the rigid application of the rules of procedure to afford the parties the opportunity to
fully ventilate their cases on the merits. However, as correctly pointed out by the private respondents, such liberality in the
application of rules of procedure may not be invoked if it will result in the wanton disregard of the rules or cause needless
delay in the administration of justice. It is equally settled that, save for the most persuasive of reasons, strict compliance is
enjoined to facilitate the orderly administration of justice

FACTS: PETITION for review on certiorari of the resolutions of the Court of Appeals.

It appears that private respondents, Ernesto Ong and Ma. Sonia Tan Soon Ha purchased from petitioner, El Reyno Homes,
Inc., a subdivision plan situated at Quezon City by Transfer Certificate of Title. For its failure to develop and deliver the
title to the property, the private respondents filed an action against the petitioner for specific performance and for violation
of Sections 19, 20, 25 and 29 of PD No. 9573on March 22, 1991 with the Housing and Land Use Regulatory Board (HLURB
for brevity). After conducting the required hearings and an ocular inspection of the property, HLURB arbiter rendered
judgment against the respondent EL REYNO HOMES, INC.,

From the said decision, the petitioner filed a notice of appeal with the HLURB Board of Commissioners. However, the
petitioner failed to file its memorandum of appeal within the extended period prompting the private respondents to file a
motion to dismiss the appeal. The Board issued an Order dismissing the appeal of the petitioner. Petitioner filed a motion
for reconsideration but was denied by the Board.

The petitioner timely filed a notice of appeal with the Office of the President. On October 27, 1999, the Office of the
President rendered a decision9 dismissing the appeal of the petitioner.

On November 25, 1999, the petitioner filed with the Court of Appeals a motion for an extension10 of 15 days within which
to file a petition for review. On December 9, 1999, which was within the requested period of extension, the petitioner filed
a petition for review11with the Court of Appeals.
In the questioned Resolution dated December 15, 1999 however, the Court of Appeals denied petitioner’s motion for
extension of time to file a petition for review for not having been accompanied by an affidavit of service, consequently
dismissing the case. The motion for reconsideration of the questioned resolution was denied by the appellate court on March
10, 2000. Hence, the instant petition.

In their comment,15 the private respondents contend that, while the rules of procedure may be liberally construed, such
liberality should not apply in case of wanton disregard of said rules or if it will only cause needless delay.

By way of reply,17 the petitioner insists that its failure to attach the required affidavit of service to its motion was not a
wanton disregard of the rules nor intended to cause needless delay in the administration of justice

ISSUE: W/N the court of appeals committed an error in dismissing the case on pure technicality thereby denying the
petitioner its day in court.

HELD: We deny the instant petition.

In not a few instances, we relaxed the rigid application of the rules of procedure to afford the parties the opportunity to fully
ventilate their cases on the merits. However, as correctly pointed out by the private respondents, such liberality in the
application of rules of procedure may not be invoked if it will result in the wanton disregard of the rules or cause needless
delay in the administration of justice. It is equally settled that, save for the most persuasive of reasons, strict compliance is
enjoined to facilitate the orderly administration of justice.20

Petitioner in this case failed to file the required memorandum of appeal within the extended period prayed for by the
petitioner itself with the HLURB. In its motion for extension of time to file a petition with the Court of Appeals, unmindful
of its previous mistake, the petitioner this time failed to attach required affidavit of service.

Petitioner has failed to convince the Court that an extremely compelling reason exists to justify suspension of the strict
application of the rules and to avert the commission of grave injustice. As found by the HLURB arbiter, the same was due
to the fault of the said petitioner.

WHEREFORE, in view of the foregoing, the petition is hereby DENIED and the questioned resolutions of the Court of
Appeals are hereby AFFIRMED. SO ORDERED.

TOLEDO vs. TOLEDO

FACT: PETITION for review of a decision of the Court of Appeals. On December 26, 1973, petitioner Daria
Gonzales Vda.de Toledo executed a Special Power of Attorney authorizing her stepson, Antonio Toledo, to obtain loan
from a bank, and mortgage the subject property as security therefor.2 Spouses Antonio Toledo obtained a loan from Rural
Bank of Carmen (Cebu) Inc. in the amount of P2,467.80 secured by a real estate mortgage constituted on subject property.3

The Toledo spouses failed to pay their loan to the Bank despite several demands. 4 Hence, on July 6, 1981, the Bank
extrajudicially foreclosed the mortgage. Accordingly, the property was sold at public auction, with the Bank as the sole and
highest bidder. Correspondingly, the Bank was issued a Certificate of Sale5 upon satisfaction of the obligations of spouses
Toledo in the amount of P5,014.00, including interests, penalty, attorney’s fees and miscellaneous expenses.6

Spouses Toledo failed to redeem the subject property. The Bank sold the said parcel of land to Spouses Mauro and Oliva
Sumulong.8 However, petitioner remained on the property together with spouses Toledo.

On February 18, 1986, petitioner filed a complaint against the Spouses Toledo and the Rural Bank of Carmen (Cebu), Inc.,
and the Spouses Sumulong, for Declaration of Nullity of Extrajudicial Foreclosure of Mortgage before the Regional Trial
Court of Cebu. She alleged that the Toledo spouses preconceived a malicious, sinister and scheming idea to induce her to
execute a Special Power of Attorney to mortgage her property to the Bank and, thereafter, connived with the Sumulongs in
foreclosing the mortgage. It appears that previously, or on November 18, 1985, petitioner deposited P5,200.00 with the
Bank in order to redeem the subject property.

On June 11, 1993, the trial court rendered a decision 11declaring the extrajudicial foreclosure proceedings of the subject
property a total nullity. Consequently, the Certificate of Sale, Consolidation of Ownership and Final Deed of Sale and the
Deed of Absolute Sale executed by the Bank in favor of the Sumulong spouses were declared null and void.

Defendants appealed to the Court of Appeals which was granted. The assailed decision of court a quo was REVERSED and
SET ASIDE. Hence, the instant petition for review.

HELD: At the outset, we noted that for failure to submit proof of service,16 petitioner’s motion for extension of thirty (30)
days from August 15, 2001 within which to file the petition was denied. Thus, when petitioner filed the instant petition on
September 13, 2001, it was filed out of time. This procedural lapse on the part of petitioner would have warranted the
outright dismissal of the petition. However, In the instant case, we recognize the need to relax the rules of procedure to
relieve the petitioner of an injustice not commensurate with her failure to comply with the rules. For this reason, the case
shall be decided on the merits.

In this case, Section 5 of Republic Act No. 720 as amended by Republic Act No. 593918 reads: The foreclosure of mortgages
covering loans granted by rural banks shall be exempt from the publication in newspapers where the total amount of the
loan, including interests due and unpaid, does not exceed three thousand pesos.

At the time of foreclosure in the case at bar, the total amount of petitioners’ loan including interests due and unpaid with
the Bank was P4,652.80.19 Clearly, therefore, publication of notices of auction sale in newspapers of general circulation in
the city or municipality where the property is situated was necessary.

Undisputedly, the Bank did not publish the notices of auction sale in a newspaper of general circulation. It merely posted
the notices of auction sale in three conspicuous places including where the property was located. Considering that the auction
sale of the subject property to the Bank is void, no valid title passed in its favor. Consequently, the sale of the same property
to spouses Sumulong is also a nullity. The evidence on record shows that the Sumulong spouses are not purchasers in good
faith. It appears that the Sumulongs did not make any reasonable inquiry regarding the status of the land in question, despite
being aware that the property was still in the possession of the petitioner and respondent spouses Toledo.

All told, the auction sale of the subject property is null and void for failure of Rural Bank of Carmen (Cebu) Inc. to comply
with the statutory requirements on publication of the notices of sale.

RULE 2

Spouses Ochoa vs CBC

FACTS: For resolution is petitioners motion for reconsideration of our January 17, 2011 Resolution denying their petition
for review on certiorari for failing to sufficiently show any reversible error in the assailed judgment of the Court of Appeals
(CA).

Petitioners insist that it was error for the CA to rule that the stipulated exclusive venue of Makati City is binding only on
petitioners complaint for Annulment of Foreclosure, Sale, and Damages filed before the Regional Trial Court of Paraaque
City, but not on respondent banks Petition for Extrajudicial Foreclosure of Mortgage, which was filed with the same court.

ISSUE: Whether an extrajudicial foreclosure of real estate mortgage comes within the ambit of an ordinary civil action

RULING: No. The exclusive venue of Makati City, as stipulated by the parties and sanctioned by Section 4, Rule 4 of the
Rules of Court, cannot be made to apply to the Petition for Extrajudicial Foreclosure filed by respondent bank because the
provisions of Rule 4 pertain to venue of actions, which an extrajudicial foreclosure is not.

Pertinent are the following disquisitions in Supena v. De la Rosa:

Section 1, Rule 2 [of the Rules of Court] defines an action in this wise:

"Action means an ordinary suit in a court of justice, by which one party prosecutes
another for the enforcement or protection of a right, or the prevention or redress of a
wrong."

Hagans v. Wislizenus does not depart from this definition when it states that "[A]n action is a formal demand
of one's legal rights in a court of justice in the manner prescribed by the court or by the law. x x x." It is
clear that the determinative or operative fact which converts a claim into an "action or suit" is the filing of
the same with a "court of justice." Filed elsewhere, as with some other body or office not a court of justice,
the claim may not be categorized under either term. Unlike an action, an extrajudicial foreclosure of real
estate mortgage is initiated by filing a petition not with any court of justice but with the office of the
sheriff of the province where the sale is to be made. By no stretch of the imagination can the office of the
sheriff come under the category of a court of justice.

Verily then, with respect to the venue of extrajudicial foreclosure sales, Act No. 3135, as amended, applies, it being a special
law dealing particularly with extrajudicial foreclosure sales of real estate mortgages, and not the general provisions of the
Rules of Court on Venue of Actions.

Turner vs LSC

FACTS: The petitioners held 1,010,000 shares of stock of the respondent, a domestic corporation engaged primarily in
cargo shipping activities. The respondent decided to amend its articles of incorporation to remove the stockholders pre-
emptive rights to newly issued shares of stock. Feeling that the corporate move would be prejudicial to their interest as
stockholders, the petitioners voted against the amendment and demanded payment of their shares.
Due to the disagreement on the valuation of the shares led the parties to constitute an appraisal committee pursuant to
Section 82 of the Corporation Code.
The appraisal committee reported its valuation of P2.54/share, for an aggregate value of P2,565,400.00 for the petitioners.

Petitioners then demanded payment, however, the respondent refused the petitioners demand, explaining that pursuant to
the Corporation Code, the dissenting stockholders exercising their appraisal rights could be paid only when the corporation
had unrestricted retained earnings to cover the fair value of the shares, but that it had no retained earnings at the time of the
petitioners demand.

Upon the respondents refusal to pay, the petitioners sued the respondent for collection and damages in the RTC
in Makati City.

RTC ruled in favor of the petitioners.

Respondent then commenced a special civil action for certiorari in the CA to challenge the order of Judge Tipon, claiming
that JUDGE TIPON GRAVELY ABUSED HIS DISCRETION IN GRANTING SUMMARY JUDGMENT TO THE
SPOUSES TURNER as the petitioners does not have a cause of action.
CA ruled in favor of respondent. The petitioners now come to the Court for a review on certiorari of the CAs decision

ISSUE: Whether Petitioner’s cause of action had already arisen when they filed the civil suit against the respondent.

RULING: No. Respondent had indisputably no unrestricted retained earnings in its books at the time the petitioners
commenced Civil Case proved that the respondents legal obligation to pay the value of the petitioners shares did not yet
arise. Thus, the CA did not err in holding that the petitioners had no cause of action, and in ruling that the RTC did not
validly render the partial summary judgment.

A cause of action is the act or omission by which a party violates a right of another. The essential elements of a cause of
action are: (a) the existence of a legal right in favor of the plaintiff; (b) a correlative legal duty of the defendant to respect
such right; and (c) an act or omission by such defendant in violation of the right of the plaintiff with a resulting injury or
damage to the plaintiff for which the latter may maintain an action for the recovery of relief from the defendant. Although
the first two elements may exist, a cause of action arises only upon the occurrence of the last element.

Section 1, Rule 2, of the Rules of Court requires that every ordinary civil action must be based on a cause of action.
Accordingly, Civil Case No. 01-086 was dismissible from the beginning for being without any cause of action.

The petitioners right of action could only spring from an existing cause of action. Thus, a complaint whose cause of action
has not yet accrued cannot be cured by an amended or supplemental pleading alleging the existence or accrual of a cause of
action during the pendency of the action. For, only when there is an invasion of primary rights, not before, does the adjective
or remedial law become operative. Verily, a premature invocation of the courts intervention renders the complaint without
a cause of action and dismissible on such ground. In short, Civil Case No. filed by petitioners, being a groundless suit,
should be dismissed.

VMTA Inc. vs VMGA Inc. et al

FACTS: Ortigas & Company, Limited Partnership (Ortigas) is the owner of the Greenhills Shopping Center (GSC). On 5
November 1975, Ortigas and Virra Realty Development Corporation (Virra Realty) entered into a Contract of Lease (First
Contract of Lease) over a portion of the GSC. The 25-year lease was to expire on 15 November 2000.

Virra Realty organized respondent Virra Mall Greenhills Association (VMGA)

On 22 November 2000, VMGA, through its president, William Uy (Uy), requested from Ortigas the renewal of the First
Contract of Lease.

On 5 May 2001, Virra Mall was gutted by fire, requiring substantial repair and restoration. VMGA thus filed an insurance
claim through the insurance broker, respondent Winternitz. Thereafter, the proceeds of the insurance were released to
VMGA.

Ortigas entered into a Contract of Lease (Second Contract of Lease) with Uy effective 2 November 2001 to 31 December
2004. On 11 September 2001, Uy assigned and transferred to petitioner Virra Mall Tenants Association (VMTA) all his
rights and interests over the property.

On 7 February 2003, Ortigas filed a Complaint for Specific Performance with Damages and Prayer for Issuance of a Writ of
Preliminary Attachment against several defendants, including herein respondents. It accused them of fraud, misappropriation and
conversion of substantial portions of the insurance proceeds for their own personal use unrelated to the repair and restoration of
Virra Mall. To secure the subject insurance proceeds, Ortigas also sought the issuance of a writ of preliminary attachment against
herein respondents.
VMTA filed a Complaint-in-Intervention. It claimed that as the assignee or transferee of the rights and obligations of Uy in
the Second Contract of Lease, and upon the order of Ortigas, it had engaged the services of various contractors. These
contractors undertook the restoration of the damaged area of Virra Mall amounting to P18,902,497.75. Thus, VMTA sought
the reimbursement of the expenses it had incurred in relation thereto. RTC admitted the Complaint-in-Intervention in its
Order dated 8 January 2004.

Respondents moved for the dismissal of the Complaint-in-Intervention on the ground that it stated no cause of action. RTC
denied such motion.

Respondents then filed a Rule 65 Petition for Certiorari alleging grave abuse of discretion, the CA reversed the ruling of
RTC and dismissed the Complaint-in-Intervention on the following ground that VMTA failed to state a cause of action.

VMTA filed a Motion for Reconsideration, which the CA denied. Thus this instand petition.

ISSUE: Whether petitioners has a cause of action in filing its Complaint-in-Intervention

RULING: Yes. A cause of action is defined as the act or omission by which a party violates a right of another.
In the case at bar, VMTA, in its Complaint-in-Intervention, explicitly laid down its cause of action as follows:

Pursuant to and by virtue of such claim, defendant VMGA and defendant VMGA Board Members,
impleaded as party defendants herein, received, at various times, from their insurance broker, and it is in
their custody, the insurance proceeds arising out of such claim which, as of January 8, 2003, aggregated
P48.6-Million. Having failed to deliver the said proceeds to the real beneficiary inspite of due notice and
demand, plaintiff Ortigas herein instituted the present action against all the defendants to compel
delivery of the said insurance proceeds which are being unlawfully and illegally withheld by all the
defendant VMGA and defendant VMGA Board Members inspite of written demands made
therefor. Worse, a portion of said insurance proceeds, aggregating P8.6-Million had already been disbursed
and misappropriated in breach of trust and fiduciary duty. (Emphasis supplied.)

It is clear from the foregoing allegations that VMTAs purported right is rooted in its claim that it is the real beneficiary of
the insurance proceeds, on the grounds that it had (a) facilitated the repair and restoration of the insured infrastructure upon
the orders of Ortigas, and (b) advanced the costs thereof. Corollarily, respondents have a duty to reimburse it for its expenses
since the insurance proceeds had already been issued in favor of respondent VMGA, even if the latter was not rightfully
entitled thereto. Finally, the imputed act or omission on the part of respondents that supposedly violated the right of VMTA
was respondent VMGAs refusal, despite demand, to release the insurance proceeds it received to reimburse the former for
the expenses it had incurred in relation to the restoration and repair of Virra Mall. Clearly, then, VMTA was able to establish
its cause of action.

SAMSON vs. SPOUSES GABOR

FACTS: The Spouses Gabor executed a Deed of Assignment transferring 20,631 square meters undivided portion of land
situated at Barrio Mapunso, Tanay, Rizal Province, in favor of petitioner Emiliano S. Samson as attorney’s fees in payment
for the services rendered by the latter for the former.

petitioner Samson executed a Deed of Assignment transferring the same undivided portion in favor of Ma. Remedios P.
Ramos. Upon learning of the sale, respondent spouses filed an action for legal redemption with the RTC of Tanay, Rizal.
Immediately thereafter, petitioner Samson and Ramos executed an Agreement of Rescission revoking the transfer of the
undivided portion. The civil case regarding this issue had already became final and executory in favor of the spouses.

Years later petitioner Samson filed a Complaint before the RTC of Pasig City for Recovery of Property or its Value against
respondent spouses, Tanay Rural Bank, Inc., and the Register of Deeds of Morong, Rizal, claiming that he had been paying
his one-third (1/3) share of realty taxes covering the subject portion of land for the years 2002 to 2004. In 2005, however,
his payment was rejected by the Municipal Treasurer of Tanay, Rizal, at such time he discovered that respondent spouses
had already mortgaged the entire property in favor of respondent Bank back in November 2002.

The RTC of Pasig City dismissed the complaint on the grounds of improper venue, res judicata, and that the complaint states
no cause of action. It held that the suit is a real action which should be filed in the RTC of Morong, Rizal, where the property
subject of the case is situated. Moreover, the lower court pointed out that as early as 1991, herein petitioner had already
filed a Complaint for Partition of Real Property and Damages involving the same subject property against the same parties,
which complaint was already dismissed by this Court with finality.

ISSUE: Petitioner’s complaint states a cause of action.

RULING: No. We further agree with the RTC of Pasig City when it dismissed petitioner’s complaint on the ground that
the same states no cause of action in the following wise:

The complaint states no cause of action as herein defendant was impleaded without stating any details of its liabilities nor
any allegation of its violations to the plaintiff’s rights. The only allegation of the rights violated are Articles 19, 20, and 21
of the Civil Code. More importantly, there are no allegations in the complaint that defendant Tanay Rural Bank (TRB) has
violated the aforesaid laws. There is no detail on why the defendant TRB has been impleaded in the instant case.

A perusal of the complaint would show that aside from the fact that respondent spouses had mortgaged the property subject
herein to respondent bank, there is no other allegation of an act or omission on the part of respondent Bank in violation of
a right of petitioner.

BELLE Corporation vs De Leon-Banks

FACTS: The disputed property was a 13.29 hectare parcel of unregistered land originally belonging to the late spouses
Eufronio and Josefa De Leon.

A Deed of Absolute Sale (1979 DEED) was executed between the LATE SPOUSES De Leon and NELFRED, represented
therein by defendant-appellee Nelia De Leon-Alleje, wherein ownership of the property was conveyed to Nelia De Leon-
Alleje being principal stockholders and officers of NELFRED

Herein petitioner BELLE, on one hand, and NELFRED and SPOUSES ALLEJE on the other, executed a Contract to Sell
covering the disputed property. When the final installment had been paid, a Deed of Absolute Sale (1998 DEED) was
executed between BELLE and NELFRED wherein the latter transferred ownership of the disputed property to the former.

Herein respondents (heirs of late spouses De Leon) filed a Complaint for "Annulment of Deed of Sale, Reconveyance of
Property with Prayer for Issuance of a Writ of Preliminary Injunction and Damages" against the SPOUSES ALLEJE,
NELFRED and BELLE wherein they sought the annulment of the Contract to Sell. They alleged that the 1979 DEED was
simulated; that NELFRED paid no consideration for the disputed property; that the disputed property was to be held in trust
by Nelia De Leon-Alleje, through, NELFRED, for the equal benefit of all of the LATE SPOUSES' children.

SPOUSES ALLEJE and NELFRED filed a Motion to Dismiss wherein they alleged that herein respondents' cause of action,
the existence of an implied trust between them and NELFRED on the one hand and the LATE SPOUSES on the other, was
barred by prescription and laches because more than 10 years had passed since the execution of the 1979 DEED.

BELLE filed a Motion to Dismiss wherein it alleged that the Complaint stated no cause of action against BELLE, which
was an innocent purchaser for value; that assuming, for the sake of argument, that herein respondents had a cause of action
against BELLE, the claim on which the Complaint is founded was unenforceable; and assuming that the cause of action was
based on an implied trust, the same had already been barred by laches.

ISSUE: Whether respondents had a cause of action against BELLE

RULING: Yes. In determining whether a complaint states a cause of action, the RTC can consider all the pleadings filed,
including annexes, motions, and the evidence on record.1The focus is on the sufficiency, not the veracity, of the material
allegations. Moreover, the complaint does not have to establish facts proving the existence of a cause of action at the outset;
this will have to be done at the trial on the merits of the case.

It is evident from the allegations in the Amended Complaint that respondents specifically alleged that they are owners of
the subject property being held in trust by their sister, Nelia Alleje, and that petitioner acted in bad faith when it bought the
property from their sister, through her company, Nelfred, knowing that herein respondents claim ownership over it.

Assuming the above allegations to be true, respondents can, therefore, validly seek the nullification of the sale of the subject
property to petitioner because the same effectively denied them their right to give or withhold their consent if and when the
subject property is intended to be sold, which right was also alleged by respondents to have been provided for in the trust
agreement between their parents and their sister, Nelia Alleje. The Court, thus, finds no error on the part of the CA in ruling
that the allegations in the complaint are sufficient to establish a cause of action for the nullification of the sale of the subject
property to herein petitioner.

Heirs of Dolleton et. al. v. Fil-EstateManagement, Inc., et. al.,

GR 170750, April 7 2009

MAIN POINT: The elementary test for failure to state a cause of action is whether the complaint alleges facts, which if
true, would justify the relief demanded. The inquiry is into the sufficiency, not the veracity of the material allegations. If
the allegations in the complaint furnish sufficient basis on which it can be maintained, it should not be dismissed regardless
of the defense that may be presented by the defendant.

FACTS: This is a consolidated case (eight complaints with similar allegations) for quieting of title and recovery of
ownership and possession by petitioners, the Heirs of Tomas Dolleton et.al.. Petitioners alleged that they had been in
continuous, open, and exclusive possession of the subject properties for more than 90 years until they were forcibly ousted
by armed men hired by respondents. They had cultivated the subject properties and religiously paid the real estate taxes for
the same. They also averred that the TCTs held by respondents cannot be relied upon as the subject properties were not
covered by said certificates and said TCTs were spurious.

Respondents moved for the dismissal of the eight Complaints on the grounds of (1) prescription; (2) laches; (3) lack of cause
of action; and (4) res judicata. They alleged that assuming that petitioners were able to prove their allegations of longtime
possession and payment of realty taxes on the subject properties, and to submit a sketch plan of the same, these cannot
defeat a claim of ownership over the parcels of land, which were already registered under the Torrens system in the name
of respondents and the other consortium members.

The RTC granted the motion to dismiss, which was later affirmed by the CA.

ISSUE: Whether the RTC properly granted respondents motion to dismiss for lack of cause of action

RULING: No. The SC ruled that the eight complaints sufficiently stated a cause of action. The Complaints alleged that
petitioners are the owners of the subject properties by acquisitive prescription. As owners thereof, they have the right to
remain in peaceful possession of the said properties and, if deprived thereof, they may recover the same.

Section 2, Rule 2 of the Rules of Civil Procedure defines a cause of action as the act or omission by which a party violates
the right of another. Its essential elements are as follows: (1) a right in favor of the plaintiff by whatever means and under
whatever law it arises or is created; (2) an obligation on the part of the named defendant to respect or not to violate such
right; and (3) an act or omission on the part of such defendant in violation of the right of the plaintiff or constituting a breach
of the obligation of the defendant to the plaintiff, for which the latter may maintain an action for recovery of damages or
other appropriate relief.

ASB REALTY Corp. v. ORIGAS &COMPANY LIMITED PARTNERSHIP

GR202947, December 9, 2015

MAIN POINT: The essential elements of a cause of action are: (1) a right in favor of the plaintiff by whatever means and
under whatever law it arises or is created; (2) an obligation on the part of the defendant not to violate such right; and (3) an
act or omission on the part of the defendant in violation of the right of the plaintiff or constituting a breach of the obligation
of the defendant to the plaintiff for which the latter may maintain an action for recovery of damages or other relief.

FACTS: Respondent Ortigas entered into a Deed of Sale with Amethyst Pearl Corporation involving the parcel of land with
an area of 1,012 sq.m. for the consideration of P2,024,000.00 and with the following conditions: (1) the lot may be used
only “for office and residential purposes”; (2) That Amethyst should submit the final plans and specifications of its proposed
building not later than six (6) months from June 29, 1994; and (3) That no advertisements or any kind of commercial signs
shall be allowed on the lot or the improvements therein. Later, Amethyst assigned the subject property to its sole stockholder,
petitioner ASB Realty Corporation, under a so-called Deed of Assignment in Liquidation and free from any liens or
encumbrances except those duly annotated conditions of such sale.

On July 7, 2000, Ortigas filed its complaint for specific performance, then a rescission of the deed of sale against the
petitioner and alleged that the conditions on the original deed of sale were not complied with. Ortigas prayed for the
reconveyance of the subject property, or, alternatively, for the demolition of the structures and improvements thereon, plus
the payment of penalties, attorney’s fees and costs of suit. During the pendency of the proceedings in the RTC, the petitioner
amended its Articles of Incorporation to change its name to St. Francis Square Realty Corporation.

RTC ruled against Ortigas stating that Ortigas sold the property to Amethyst. Amethyst was supposed to finish construction
on 31 December 1995. CA affirmed such decision but it later on reversed its decision saying that under Art. 1144, Ortigas
has 10 years to file its complaint, which it timely did. ASB contends that it could not have complied with the particular
restriction to finish construction of the building as the period to finish the same had already lapsed by the time ASB acquired
the property by way of a Deed of Assignment in Liquidation between AMETHYST and ASB. CA ruled that the assignment
or transfer of the subject property from AMETHYST to ASB does not serve to defeat the vested right of ORTIGAS to avail
of remedies to enforce the subject restriction within the applicable prescriptive period.

ISSUE: Whether a cause of action exists when Ortigas filed a complaint for rescission of deed of sale against ASB and not
against Amethyst, the original vendee

RULING: No. Ortigas did not have a cause of action against the petitioner for the rescission of the Deed of Sale. Under
Section 2, Rule 2 of the Rules of Court, a cause of action is the act or omission by which a party violates a right of another.
The essential elements of a cause of action are: (1) a right in favor of the plaintiff by whatever means and under whatever
law it arises or is created; (2) an obligation on the part of the defendant not to violate such right; and (3) an act or omission
on the part of the defendant in violation of the right of the plaintiff or constituting a breach of the obligation of the defendant
to the plaintiff for which the latter may maintain an action for recovery of damages or other relief. It is only upon the
occurrence of the last element that the cause of action arises, giving the plaintiff the right to file an action in court for the
recovery of damages or other relief.
The second and third elements were absent herein. The petitioner was not privy to the Deed of Sale because it was not the
party obliged thereon. Not having come under the duty not to violate any covenant in the Deed of Sale when it purchased
the subject property despite the annotation on the title, its failure to comply with the covenants in the Deed of Sale did not
constitute a breach of contract that gave rise to Ortigas' right of rescission. It was rather Amethyst that defaulted on the
covenants under the Deed of Sale; hence, the action to enforce the provisions of the contract or to rescind the contract should
be against Amethyst. In other words, rescission could not anymore take place against the petitioner once the subject property
legally came into the juridical possession of the petitioner, who was a third party to the Deed of Sale.

PEREZ v. CA, et.al.

GR 157616, July 22, 2005

MAIN POINT: The ultimate test to ascertain identity of causes of action is whether or not the same evidence fully supports
and establishes both the first and second cases. A different cause of action is one that proceeds not only on a sufficiently
different legal theory, but also on a different factual footing as not to require the trial of facts material to the former suit;
that is, an action that can be maintained even if all disputed factual issues raised in the plaintiffs original complaint are
concluded in defendants favor.

FACTS: Sps. Digos obtained a loan amounting to P5.8 million from International Exchange Bank, which was secured with
a real estate mortgage (REM). For failure to pay the amortizations on their loan, the bank caused the extra-judicial
foreclosure of their REM. Consequently, the property was sold at public auction, with the bank as the highest bidder
at P4,500,000.00, which appeared to be the amount on the account of the spouses Digos at the time. Sps. Digos requested
for a period of 6 months to redeem the property but the bank only gave them a month to redeem such. Instead of redeeming
the property before the deadline, Sps. Digos filed a complaint with the RTC against the bank.

In their first complaint, the Sps. Digos alleged that they were denied their right to due process in relation to the violation by
the bank of the right to a judicial, not extrajudicial, foreclosure of the real estate mortgage and for an extension of the period
for the respondents to redeem the property with damages. The RTC dismissed the complaint, which the CA affirmed and
entry of judgment was made on record. Sps. Digos failed to timely appeal this decision. Subsequently, the bank sold the
property to Perez and Ragua.

Again, Sps. Digos filed a second complaint with the RTC against the bank, Perez, and Ragua, which relates to the breach
by the bank of its loan contract with the respondents by causing the extrajudicial foreclosure of the real estate mortgage
for P4,500,000.00 which was in excess of their unpaid account with the bank. Perez and Ragua filed a motion to dismiss on
similar grounds of res judicata, splitting of a single cause of action and forum shopping. RTC ruled that there was no identity
of issue in the two actions because in the second complaint, Sps. Digos assailed the legality of the extrajudicial foreclosure,
on the sole ground that the bank had unlawfully increased their obligation, contrary to the terms and conditions of the loan
contract. CA affirmed this ruling.

ISSUE: Whether there was a splitting of a single cause of action when the second complaint was filed

RULING: Yes. The court ruled that the filing of the second complaint was a last-ditch attempt to resuscitate their lost cause,
a brazen violation of the principle of res judicata (Section 4, Rule2. Splitting a single cause of action consists in dividing a
single or indivisible cause of action into several parts or claims and instituting two or more actions therein. A single cause
of action or entire claim or demand cannot be split up or divided so as to be made the subject of two or more different
actions.

In the present case, before the private respondents filed their first complaint, they already knew that the balance of their
account with the bank was P4,500,000.00. They even offered to make a P1,000,000.00 partial payment of their loan to
reduce their account to P3,500,000.00. More telling is the private respondents failure to object to the extrajudicial
foreclosure of the real estate mortgage and the sale at public auction; they even pleaded to be allowed to redeem the property
after it had already been sold at public auction. The respondents were proscribed from claiming that the foreclosure of the
real estate mortgage was for an amount in excess of the balance of their account and that the sale at public auction was
irregular/illegal.

It bears stressing that a party cannot divide the grounds for recovery. A plaintiff is mandated to place in issue in his pleading,
all the issues existing when the suit began. A lawsuit cannot be tried piecemeal. The plaintiff is bound to set forth in his first
action every ground for relief, which he claims to exist and upon which he relied, and cannot be permitted to rely upon them
by piecemeal in successive action to recover for the same wrong or injury.
CHU et.al. v. SPS. CUNANAN, et.al.
GR 156185, September 12, 2011

MAIN POINT: Splitting a single cause of action is the act of dividing a single or indivisible cause of action into several
parts or claims and instituting two or more actions upon them. A single cause of action or entire claim or demand cannot be
split up or divided in order to be made the subject of two or more different actions.

FACTS: Sps. Chu executed a deed of sale with assumption of mortgage involving their five parcels of land in favor of
Trinidad N. Cunanan for the consideration ofP5,161,090.00. They also executed a so-called side agreement, whereby they
clarified that Cunanan had paid only P1,000,000.00 to the Chus despite the Chus, as vendors, having acknowledged
receivingP5,161,090.00; that the amount of P1,600,000.00 was to be paid directly to Benito Co and to Security Bank, whose
favor the five lots had been mortgaged; and that Cunanan would pay the balance of P2,561.90.00 within three months. The
parties further stipulated that the ownership of the lots would remain with the Chus as the vendors and would be transferred
to Cunanan only upon complete payment of the total consideration and compliance with the terms of the deed of sale with
assumption of mortgage. Cunanan was able to transfer the title of the five lots to her name without the knowledge of the
Chus, and to borrow money with the lots as security without paying the balance of the purchase price to the Chus. . She
later transferred two of the lots to Spouses Amado and Gloria Carlos.

The Chus then filed a case to recover the unpaid balance from Sps. Cunanan. Five years later, they amended their complaint
and sought for the annulment of the deed of sale. Later, the parties entered into a compromise agreement where Sps. Cunanan
would transfer 50% of its share in all parcels of land registered in the name of Cool Town Realty – this was approved by
the RTC.

Later on, Catalina Chu and her children filed another case for cancellation of TCTs in the name of Benelda Estate (where
Sps Cunanan sold some of the subject property). The Cunanans moved to dismiss the case on the ground of res judicata and
lack of cause of action on the basis of the compromised agreements entered into by the Chus and the Cunanans. The RTC
denied the motion to dismiss holding that the amended complaint stated a cause of action against all the defendants; that the
action was not barred by res judicata because there was no identity of parties and subject matter. The CA ruled that
the compromise agreement had ended the legal controversy between the parties with respect to the cause of action arising
from the deed of sale with assumption of mortgage covering all the five parcels of land.

ISSUE: Whether the Chus are guilty of splitting their single cause of action when they filed the second complaint against
Benelda Estates

RULING: Yes. The petitioners were guilty of splitting their single cause of action to enforce or rescind the deed of sale
with assumption of mortgage. The petitioners were not at liberty to split their demand to enforce or rescind the deed of sale
with assumption of mortgage and to prosecute piecemeal or present only a portion of the grounds upon which a special relief
was sought under the deed of sale with assumption of mortgage, and then to leave the rest to be presented in another suit;
otherwise, there would be no end to litigation.

In fine, the rights and obligations of the parties the five lots were all defined and governed by the deed of sale with
assumption of mortgage, the only contract between them. That contract was single and indivisible, as far as they were
concerned. Consequently, the Chus could not properly proceed against the respondents in second case, despite the silence
of the compromise agreement as to the Carloses and Benelda Estate, because there can only be one action where the contract
is entire, and the breach total, and the petitioners must therein recover all their claims and damages. The Chus could not be
permitted to split up a single cause of action and make that single cause of action the basis of several suits.

RCASF v. SORIANO, JR., et.al.

GR 153829, August 17, 2011

MAIN POINT: Section 6 of Rule 2 explicitly provides that misjoinder of causes of action is not a ground for dismissal of
an action.

FACTS: The Roman Catholic Archbishop (RCA) claimed that it is the owner of the vast tract of land located in Pampanga
covered with a registered TCT. RCA alleged that several individuals occupied the land and refused to vacate despite repeated
demands. RCA, filed an ejectment case against the alleged intruders. On the other hand, defendants countered that the RCA
has no cause of action against them because its title is spurious. They contended that the subject land belonged to the State,
but they have already acquired the same by acquisitive prescription as they and their predecessors-in-interest have been in
continuous possession of the land for more than thirty (30) years. MCTC ruled in favor of RCA. The trial court held that
OCT No. 17629 in the name of the RCA remains valid and binding against the whole world until it is declared void by a
court of competent jurisdiction. Defendants appealed to the RTC and such appeal was dismissed. They elevated the case to
the CA, which was also dismissed. Guinto, one of the defendants also filed a TRO against the sheriff with regard to the
execution of MCTC’s judgment.

Meanwhile, during the pendency of the ejectment case at the MCTC, some of the defendants therein filed against against the RCA
for Quieting of Title and Declaration of Nullity of Title before the RTC. They claimed that they are in actual possession of the
land in the concept of owners and alleged that OCT No. 17629 in the name of RCA is spurious and fake. RCA filed a motion to
dismiss; chich was dismissed by the RTC. The RTC also found that plaintiffs have a cause of action. Furthermore, the trial
court held that RCAs argument that the property cannot be acquired by prescription because it has title over it is a matter of
evidence, which may be established during the trial on the merits. RCA filed an MR which was denied by the RTC and CA.

In this petition for review on certiorari, RCA submits that an action for quieting of title is a special civil action covered by
Rule 63, while an action for declaration of nullity of title is governed by ordinary rules. Thus, it contends that these cases
should have been dismissed for violation of the rule on joinder of actions under Section 5, Rule 2 of the 1997 Rules of Civil
Procedure, as amended, which requires that the joinder shall not include special civil actions governed by special rules;
condluding that the CA erred in dismissing the MR of RCA
ISSUE: Whether the cases filed by the defendants should have been dismissed for violation of the rule on joinder of actions
under Section 5, Rule 2

RULING: No. Such contention is utterly bereft of merit and insufficient to show that the CA erred in upholding the trial
courts decision. Section 6 of Rule 2 explicitly provides that misjoinder of causes of action is not a ground for dismissal of
an action. SC dismissed the petition of RCA. It also ruled that the MCTC has already rendered a decision in favor of the
RCA and ordered the defendants therein to vacate the premises. Their appeal to the RTC was dismissed and the decision
has become final. Evidently, their right to possess the property in question has already been declared inferior or inexistent
in relation to the right of the RCA in the MCTC decision, which has already become final and executory. However, the
action for Quieting of Title and Declaration of Nullity of Title filed by the defendant can still prosper. SC affirmed the decision
of the trial court that RCA’s argument that the property cannot be acquired by prescription because it has title over it is a
matter of evidence, which may be established during the trial on the merits.

Salvador, et. al. v. Patricia, Inc.

GR No. 195834

An action for injunction and quieting of title may be severed and proceeded with separately by the Court either by a motion
of a party or upon the initiative of the Court

FACTS:

1. This is an action for injunction and quieting of title to determine who owns the property occupied by the plaintiffs
and intervenor, Ciriano Mijares;

2. Additionally, to prevent Patricia Inc., from evicting the plaintiffs from their respective improvements along Juan
Luna St., plaintiffs applied for a preliminary injunction in their complaint pending the quieting of title on the merits;

RTC: The preliminary injunction was granted. It ruled in favor of the petitioners and against Patricia, Inc., permanently
enjoining the latter from doing any act that would evict the former from their respective premises and collecting any rentals
from them. It sided with two of the commissioners who had found that the land belonged to the City of Manila;

CA: It reversed the RTC’s decision and dismissed the complaint. It declared that the petitioners were without the necessary
interest, either legal or equitable title to maintain a suit for quieting of title. (Did not rule about the joinder of causes of
action)

ISSUE: Whether or not the RTC is correct is allowing the joinder of the causes of action for injunction and the action to
quiet title

RULING: NO. One of the errors of the petitioner is when they joined their causes of action namely, injunction and quieting
of title, despite the first being an ordinary suit and the latter a special civil action under Rule 63. Consequently, the RTC
should have severed the causes of action, either upon motion or motu proprio, and tried them separately, assuming it had
jurisdiction over both. Such severance was pursuant to Section 6, Rule 2 of the Rules of Court.

Unicapital, Inc., et al. v. Consing Jr.

GR No. 175277 & 175285

Involves three principles under Rule 2:

A cause of action is defined as the act or omission by which a party violates a right of another. It is well-settled that the
existence of a cause of action is determined by the allegations in the complaint.

See first paragraph of the ruling for the main point re: misjoinder of cause of action

It has long been settled that while the court acquires jurisdiction over any case only upon the payment of the prescribed
docket fees, its non-payment at the time of the filing of the complaint does not automatically cause the dismissal of the
complaint provided that the fees are paid within a reasonable period.

FACTS:

1. Consing, Jr. obtained a loan secured by a property over which the petitioner bought a half of it and offset such
payment from the loan obtained by the former;

2. Due to the incessant demands/recovery efforts made upon him by Unicapital and PBI to return to them the purchase
price they had paid for the subject property constituted harassment and oppression which severely affected his
personal and professional life, Consingf iled a complaint, denominated as a Complex Action for Declaratory Relief
and later amended to Complex Action for Injunctive Relief before the RTC-Pasig City against Unicapital et. al.;
 3. For their part, Unicapital et. al. filed separate Motions to Dismiss on Consing, Jr.’s complaint on the ground of
failure to state a cause of action, considering that:

(a) no document was attached against which Consing, Jr. supposedly derived his right and against which his
rights may be as certained;
(b) the demands to pay against Consing, Jr. and for him to tender post-dated checks to cover the amount due
were well within the rights of Unicapital as an unpaid creditor, as Consing, Jr. had already admitted his dealings
with them;
(c) the utterances purportedly constituting libel were not set out in the complaint; and
(d) the laws supposedly violated were not properly identified.

Moreover, Unicapital, et al. posited that the RTC-PasigCity did not acquire jurisdiction over the case given that
Consing, Jr. failed to pay the proper amount of docket fees.

RTC: Denied the MTD, holding that Consing, Jr.’s complaint sufficiently stated a cause of action for tort and damages
pursuant to Article 19 of the Civil Code. It ruled that where there is abusive behavior, a complainant, like Consing, Jr., has
the right to seek refuge from the courts. It also noted that the elements of libel in a criminal case are not the same as those
for a civil action founded on the provisions of the Civil Code, and therefore, necessitates a different treatment. It equally
refused to dismiss the action on the ground of non-payment of docket fees, despite Consing, Jr.’s escalated claims for
damages therein, as jurisdiction was already vested in it upon the filing of the original complaint.

CA: Concurred with the RTC-Pasig City that Consing Jr.'s complaint states a cause of action. It found that Unicapital and
PBI, et al.’s purportedly abusive manner in enforcing their claims against Consing, Jr. was properly constitutive of a cause
of action as the same, if sufficiently proven, would have subjected him to "defamation of his name in business circles, the
threats and coercion against him to reimburse the purchase price, fraud and falsification and breach of fiduciary obligation."
It also found that the fact that Consing Jr.'s complaint contains "nebulous" allegations will not warrant its dismissal as any
vagueness therein can be clarified through a motion for a bill of particulars." Furthermore, it noted that Consing, Jr. does
not seek to recover his claims against any particular provision of the corporation code or the securities act but against the
actions of Unicapital and PBI, et al.; hence, Consing, Jr.’s complaint was principally one for damages over which the RTC
has jurisdiction, and, in turn, there lies no misjoinder of causes of action.

ISSUE: Whether or not the RTC erred in denying Unicapital et. al’s MTD

RULING: NO. A careful perusal of his complaint discloses that Consing, Jr. did not seek to hold Unicapital and PBI, et al.
liable for any specific violation of the Corporation Code or the Revised Securities Act. Rather, he merely sought damages
for Unicapital and PBI, et al.’s alleged acts of making him sign numerous documents and their use of the same against him.
In this respect, Consing, Jr. actually advances an injunction and damages case which properly falls under the jurisdiction of
the RTC-Pasig City. Therefore, there was no violation of Section 5, Rule 2 of the Rules, particularly, paragraph (c) thereof.
Besides, even on the assumption that there was a misjoinder of causes of action, still, such defect should not result in the
dismissal of Consing, Jr.’s complaint. Section 6, Rule 2 of the Rules explicitly states that a "misjoinder of causes of action
is not a ground for dismissal of an action" and that "a misjoined cause of action may, on motion of a party or on the initiative
of the court, be severed and proceeded with separately."

Plainly, while the payment of the prescribed docket fee is a jurisdictional requirement, even its non-payment at the time of
filing does not automatically cause the dismissal of the case, as long as the fee is paid within the applicable prescriptive or
reglementary period, more so when the party involved demonstrates a willingness to abide by the rules prescribing such
payment. In fine, the Court finds no reversible error on the part of the CA in sustaining the RTC-Pasig City’s denial of
Unicapital et al.’s motion to dismiss.

RULE 3

AFV & Hernandez v. COMELEC

GR No. 203775

Only natural or juridical persons, or entities authorized by law may be parties in a civil action, which must be prosecuted
or defended in the name of the real party-in-interest

FACTS:
 1. On 28 August 2012, the Supreme Court affirmed COMELEC Resolution cancelling the certificate of registration
of the Alliance of Barangay Concerns (ABC) Party-List which won in the party-list elections in the 2010 national
elections.

2. The disqualification of the ABC Party-List resulted in the re-computation of the party-list allocations in the House
of Representatives, in which the COMELEC followed the formula outlined in the case of BANAT v. COMELEC;

3. Petitioners Association of Flood Victims and Jaime Aguilar Hernandez (Hernandez) filed with this Court a special
civil action for certiorari and/or mandamus under Rule 65 of the Rules of Court. Petitioners assert that the
COMELEC committed grave abuse of discretion when it issued Minute Resolution.

ISSUE: Whether or not the petitioners have the legal capacity to sue

RULING: NO. Petitioners do not have legal capacity to sue. In their petition, it is stated that petitioner Association of Flood
Victims "is a non-profit and non-partisan organization in the process of formal incorporation, the primary purpose of which
is for the benefit of the common or general interest of many flood victims who are so numerous that it is impracticable to
join all as parties," and that petitioner Hernandez "is a Tax Payer and the Lead Convenor of the Association of Flood
Victims." Clearly, petitioner Association of Flood Victims, which is still in the process of incorporation, cannot be
considered a juridical person or an entity authorized by law, which can be a party to a civil action.

Petitioner Association of Flood Victims is an unincorporated association not endowed with a distinct personality of its own.
An unincorporated association, in the absence of an enabling law, has no juridical personality and thus, cannot sue in the
name of the association.

Clidoro et. al. v. Jalmanzar, et. al

GR No. 176598

It is not necessary in this case that all of the parties, in whose favor the case for partition was adjudged, be made plaintiffs
to the action for revival of judgment. Any which one of said prevailing parties, who had an interest in the enforcement of
the decision, may file the complaint for revival of judgment, even just by himself.

FACTS:

1. In 1995, the CA rendered a decision for partition of the estate of the late Mateo Clidoro in favor of both parties in
this case;

2. A revival of judgment was filed by Rizalina Clidoro, et al. against Onofre Clidoro, et al., praying that the Decision
CA, which affirmed with modification of the RTC Decision for partition of the estate of the late Mateo Clidoro, be
revived and that the corresponding writ of execution be issued.

3. Defendants-appellees except Gregoria Clidoro-Palanca, moved to dismiss the said complaint on the ground that the
petition, not being brought up against the real parties-in-interest, is dismissible for lack of cause of action;

RTC: Dismissed the complaint for lack of cause of action. The complaint shows that most of the parties-plaintiffs, parties
defendants and interested parties are already deceased and have no more natural or material existence. From the foregoing,
the Court finds the instant complaint to be flawed in form and substance. The suit is not brought by the real parties-in-
interest, thus a motion to dismiss on the ground that the complaint states no cause of action is proper.
CA: Reversed and set aside the Orders of the RTC and remanded the case back to the RTC for further proceedings.

ISSUE: Whether or not the CA erred in considering the respondents as well as the petitioners as the real parties-in-interest.

RULING: NO. With the foregoing in mind, it is understandable that there would be instances where the parties in the
original case and in the subsequent action for revival of judgment would not be exactly the same. The mere fact that the
names appearing as parties in the complaint for revival of judgment are different from the names of the parties in the original
case would not necessarily mean that they are not the real parties-in-interest. What is important is that, as provided in Section
1, Rule 3 of the Rules of Court, they are "the party who stands to be benefited or injured by the judgment in the suit, or the
party entitled to the avails of the suit." Definitely, as the prevailing parties in the previous case for partition, the plaintiffs
in the case for revival of judgment would be benefited by the enforcement of the decision in the partition case.

Verily, the trial court erred in dismissing the complaint for revival of judgment on the ground of lack of, or failure to state
a cause of action. The question of whether respondents were the real parties-in-interest who had the right to seek execution
of the final and executory judgment in the partition case should have been threshed out in a full-blown trial. CA’s decision
is hereby affirmed in toto.

RMMPSTS, et. al. v. Sec. Reyes, et. al.

GR No. 180771
Even before the Rules of Procedure for Environmental Cases became effective, the Supreme Court (SC) had already taken
a permissive position on the issue of locus standi in environmental cases.

FACTS:

1. This case arose when DOE and Japan Petroleum Exploration Co. Ltd. (JAPEX) entered into an agreement for the
exploration, development and production of petroleum resources at the offshore of Tanon Strait;

2. A suit was filed by resident marine mammals, like whales, dolphins, etc., through Stewards, in order to prevent the
exploration, development and exploitation of petroleum resources within Tanon Strait, a narrow passage of water
situated between the islands of Negros and Cebu;

3. Citing Oposa v. Factoran, Jr., they also asserted their right to sue for the faithful performance of international and
municipal environmental laws created in their favor and for their benefit. In this regard, they propounded that they
have the right to demand that they be accorded the benefits granted to them in multilateral international instruments
that the Philippine Government had signed, under the concept of stipulation pour autrui.

4. Public respondents argued that the Resident Marine Mammals have no standing because Section 1, Rule 3 of the
Rules of Court requires parties to an action to be either natural or juridical persons. They also contested the
applicability of Oposa, pointing out that the petitioners therein were all natural persons, albeit some of them were
still unborn.

5. As regards the Stewards, the public respondents likewise challenged their claim of legal standing on the ground that
they are representing animals, which cannot be parties to an action. Moreover, the public respondents argued that
the Stewards are not the real parties-in-interest for their failure to show how they stand to be benefited or injured
by the decision in this case.

6. Since the petition was not brought in the name of a real party-in-interest, it should be dismissed for failure to state
a cause of action.

ISSUE: Whether or not the Resident Marine Mammals, through Stewards, have legal standing to sue

RULING: YES. Even before the Rules of Procedure for Environmental Cases became effective, this Court had already
taken a permissive position on the issue of locus standi in environmental cases. In Oposa v. Factoran, Jr., 224 SCRA 792
(1993), we allowed the suit to be brought in the name of generations yet unborn “based on the concept of intergenerational
responsibility insofar as the right to a balanced and healthful ecology is concerned.” Furthermore, we said that the right to
a balanced and healthful ecology, a right that does not even need to be stated in our Constitution as it is assumed to exist
from the inception of humankind, carries with it the correlative duty to refrain from impairing the environment. In light of
the foregoing, the need to give the Resident Marine Mammals legal standing has been eliminated by our Rules, which allow
any Filipino citizen, as a steward of nature, to bring a suit to enforce our environmental laws. It is worth noting here that
the Stewards are joined as real parties in the Petition and not just in representation of the named cetacean species. The
Stewards, Ramos and Eisma-Osorio, having shown in their petition that there may be possible violations of laws concerning
the habitat of the Resident Marine Mammals, are therefore declared to possess the legal standing to file this petition.

Alegria, et. al. vs. Drilon, et. al.,

G.R. No. 161317, July 16, 2008

FACTS: This case is a petition for review of the decision of the Court of Appeals. Petitioners claim they are the actual
occupants and tillers of two parcels of land located in Negros Oriental. Gabriel Drilon, husband of respondent Eustaquia
Drilon, applied for the issuance of titles by Free Patent over the properties and the same was granted in the name of Gabriel.
Later, spouses Drilon sold the properties to respondent spouses Alfredo and Fredeswenda Ybiosa (spouses Ybiosa). Later,
Eustaquia and spouses Ybiosa demanded that petitioners vacate the lots in issue. This prompted petitioners to file, an action
for reconveyance and declaration of nullity of the sale.

Petitioners claimed that the sale was void because the sale was made within five years from the issuance of the patents.
They also alleged that spouses Ybiosa were in bad faith when they bought the properties as they were fully aware that
petitioners were actually and continuously occupying the properties. The trial court dismissed the complaint ruling that
petitioners were unable or that they failed to establish their claim over the said Lots. Court of Appeals affirmed the decision
of the trial court ruling that it is only the State, as the owner of the property allegedly taken by Gabriel Drilon through
misrepresentation, which can assail the sale made by spouses Drilon to spouses Ybiosa.

ISSUE: Whether petitioners have the right to question the validity of the sale and ask for reconveyance of the properties.

RULING: NO. Section 2, Rule 3 of the Rules of Court provides that every action must be prosecuted or defended in the
name of the real party-in-interest, or in the name of one who stands to be benefited or injured by the judgment in the suit.
A suit filed by one who is not a real party-in-interest must be dismissed.
Citing Caro v. Sucaldito in this case, the Court held that an applicant for a free patent cannot be considered a party-in-
interest with personality to file an action for reconveyance because only the State can file a suit for reconveyance of a public
land. Therefore, not being the owners of the land but mere applicants for sales patents thereon, respondents have no
personality to file the suit. Neither will they be directly affected by the judgment in such suit.

Persons who have not obtained title to public lands could not question the titles legally issued by the State. In such cases,
the real party-in-interest is the Republic of the Philippines to whom the property would revert if it is ever established, that
the free patent issued to the grantee is indeed vulnerable to annulment. Not being an applicant, much less a grantee, petitioner
cannot ask for reconveyance.
Ang vs. Pacunio
G.R. No. 208928, July 8, 2015

FACTS: Complaint for Declaration of Nullity of Sale, Reconveyance, and Damages was filed by respondents against
petitioner involving a parcel of land originally registered in one “Udiaan's name” as evidenced by an Original Certificate of
Title. Respondents alleged that they are the grandchildren and successors-in-interest of Udiaan and left the subject land as
inheritance to her heirs. However, an impostor falsely representing herself as Udiaan sold the subject land to petitioner, as
evidenced by a Deed of Absolute Sale.

Consequently, the OCT was cancelled and a TCT was issued in the petitioners name and they later entered the subject land
and used the same in livestock business. Respondents then informed petitioner that the land was not validly acquired because
she was already dead for more than 20 years when the sale occurred, and demanded for the return of the lots but to no avail.
RTC ruled in petitioner's favor ruling that there is death of evidence proving the successional rights of respondents to
Udiaan's estate that as mere grandchildren of Udiaan, they have no successional rights to Udiaan's estate. The CA
ratiocinated that respondents could only succeed from said estate by right of representation if their mother, who is one of
Udiaan's children, predeceased Udiaan. However, such fact was not established

ISSUE: Whether the CA correctly declared the nullity of the Questioned Deed of Absolute Sale and distributed portions of
the subject land to different parties, among others, despite ruling that respondents are not real parties in interest to the instant
case

RULING: NO. The rule on real parties in interest has two (2) requirements, namely: (a) to institute an action, the plaintiff
must be the real party in interest; and (b) the action must be prosecuted in the name of the real party in interest. Respondents
will only be deemed to have a material interest over the subject land if the right of representation is available to them. In
this situation, representatives will be called to the succession by the law and not by the person represented. However, nothing
in the records would show that the right of representation is available to respondents. Hence, the RTC and the CA correctly
found that respondents are not real parties in interest to the instant case.

Having established that respondents are not the real parties in interest to the instant suit, the proper course of action was for
the CA to merely affirm the RTC's dismissal of their complaint. It therefore erred in proceeding to resolve the other
substantive issues of the case and granting one of the principal reliefs sought by respondents, which is the declaration of the
nullity of the Questioned Deed of Absolute Sale.

ATL, INC. and Olaguer vs. BSMB

FACTS: Petitioner Advocates for Truth in Lending, Inc. is a non-profit, non-stock corporation organized to engage in pro
bono concerns and activities relating to money lending issues together with its President, Eduardo Olaguer claim that they
are raising issues of transcendental importance to the public and so they filed Petition for Certiorari under Rule 65 ROC
seeking to declare that the Bangko Sentral ng Pilipinas Monetary Board (BSP-MB), replacing the Central Bank Monetary
Board (CB-MB) by virtue of R.A. No. 7653, has no authority to continue enforcing Central Bank Circular No. 905, issued
by the CB-MB in 1982, which "suspended" the Usury Law of 1916 (Act No. 2655).

R.A. No. 265, which created the Central Bank (CB) of the Philippines, empowered the CB-MB to, among others, set the
maximum interest rates which banks may charge for all types of loans and other credit operations, within limits prescribed
by the Usury Law. In its Resolution No. 2224, the CB-MB issued CB Circular No. 905, Series of 1982. Section 1 of the
Circular, under its General Provisions, removed the ceilings on interest rates on loans or forbearance of any money, goods
or credits. Later, President Fidel V. Ramos signed into law R.A. No. 7653 establishing the Bangko Sentral ng Pilipinas
(BSP) to replace the CB.

ISSUE: Whether petitioners met the requisites required under Rule 3, Sec 2 of the ROC and therefore has locus standi

RULING: NO. In private suits, Section 2, Rule 3 of the 1997 Rules of Civil Procedure provides that "every action must be
prosecuted or defended in the name of the real party in interest," who is "the party who stands to be benefited or injured by
the judgment in the suit or the party entitled to the avails of the suit." Succinctly put, a party’s standing is based on his own
right to the relief sought.

Even in public interest cases such as this petition, the Court has generally adopted the "direct injury" test that the person
who impugns the validity of a statute must have "a personal and substantial interest in the case such that he has sustained,
or will sustain direct injury as a result." Thus, while petitioners assert a public right to assail CB Circular No. 905 as an
illegal executive action, it is nonetheless required of them to make out a sufficient interest in the vindication of the public
order and the securing of relief. It is significant that in this petition, the petitioners do not allege that they sustained any
personal injury from the issuance of CB Circular No. 905.

SIC, Inc. vs. Cuenca, et. al.

G.R. No. 173297, March 6, 2013

FACTS: Stronghold Insurance Company, Inc., is a domestic insurance company. Marañon filed a complaint against
the Cuencas and Tayactac for the collection of sum of money and damages, his complaint included an application for the
issuance of writ of preliminary attachment which granted by the RTC on the condition of posting a bond of 1M. Marañon
posted a Stronghold Insurance Bond in the amount of 1M issued by the Stronghold Insurance. After serving of the summons,
the writ was enforced, the sheriff levied upon the equipment and other personal belongings to ARC Cuisine, Inc. Upon
appeal, the CA annulled and set aside and hereby dismissing the complaint in the Civil Case of the RTC for lack of
jurisdiction and remanded the case back to RTC which held Maranon and Stronghold Insurance jointly and solidarily liable
for damages to the Cuencas and Tayactac.

ISSUE: Whether Respondent Cuenca and others are the proper parties to claim any damages even they are not the owner
of the properties attached

RULING: No. There is no dispute that the properties subject to the levy on attachment belonged to Arc Cuisine, Inc. alone,
not to the Cuencas and Tayactac in their own right. They were only stockholders of Arc Cuisine, Inc., which had a
personality distinct and separate from that of any or all of them. The damages occasioned to the properties by the levy on
attachment, wrongful or not, prejudiced Arc Cuisine, Inc., not them. As such, only Arc Cuisine, Inc. had the right under the
substantive law to claim and recover such damages. This right could not also be asserted by the Cuencas and Tayactac
unless they did so in the name of the corporation itself. But that did not happen herein, because Arc Cuisine, Inc. was not
even joined in the action either as an original party or as an intervenor

Biraogo vs. PITC

G.R. No. 192935, December 7, 2010

FACTS: E.O No. 1 establishing the Philippine Truth Commission (PTC) of 2010 was signed by President Aquino. The said
PTC is a mere branch formed under the Office of the President tasked to investigate reports of graft and corruption
committed by third-level public officers and employees, their co-principals, accomplices and accessories during the previous
administration and submit their findings and recommendations to the President, Congress and the Ombudsman. However,
PTC is not a quasi-judicial body, it cannot adjudicate, arbitrate, resolve, settle or render awards in disputes between parties.
Its job is to investigate, collect and asses evidences gathered and make recommendations.

Petitioners contends the Constitutionality of the E.O. on the grounds that: It violates separation of powers as it arrogates the
power of Congress to create a public office and appropriate funds for its operation; that there is undue delegation of power;
it exceeded the authority of the Office of Ombudsman and lastly, it is violative of the equal protection clause

ISSUE: Whether petitioner is the proper party to question the validity of the said Executive Order

RULING: YES. With regard to Biraogo, he has not shown that he sustained, or is in danger of sustaining, any personal and
direct injury attributable to the implementation of E. O. No. 1. Locus standi is “a right of appearance in a court of justice on
a given question.” In private suits, standing is governed by the “real-parties-in interest” rule. It provides that “every action
must be prosecuted or defended in the name of the real party in interest.” Real-party-in interest is “the party who stands to
be benefited or injured by the judgment in the suit or the party entitled to the avails of the suit.”

Difficulty of determining locus standi arises in public suits. Here, the plaintiff who asserts a “public right” in assailing an
allegedly illegal official action, does so as a representative of the general public. He has to show that he is entitled to seek
judicial protection. He has to make out a sufficient interest in the vindication of the public order and the securing of relief
as a “citizen” or “taxpayer.

The Court, however, finds reason in Biraogo’s assertion that the petition covers matters of transcendental importance to
justify the exercise of jurisdiction by the Court. There are constitutional issues in the petition which deserve the attention of
this Court in view of their seriousness, novelty and weight as precedents.

Osmena III vs. DOTC, et al.

G.R. No. 211737, January 13, 2016

FACTS: The Mactan-Cebu International Airport (MCIA) Project which consists, among others, the construction of a new
passenger terminal is being implemented by the Department of Transportation and Communications (DOTC) under the
"Build-Operate-and-Transfer (BOT) Law." The Pre-qualification, Bids and Awards Committee (PBAC) issued a Resolution
recommending GMR-Megawide Consortium as the winning bidder for the MCIA Project.
Senator Sergio R. Osmeña III and Business for Progress Movement (BPM), filed in this Court petitions for certiorari and
injunction to restrain public respondents from awarding the Mactan-Cebu International Airport (MCIA) Project to GMR-
Megawide Consortium. Petitioners argue that GMR-Megawide Consortium because it violated the conflict of interest rule
when it failed to disclose that Mr. Tan Shri Bashir Ahmad bin Abdul Majid was a director of two subsidiaries of the GMR-
Megawide Consortium, and is also the Managing Director of Malaysia Airport Holdings Berhad (MAHB), which joined the
bidding for MCIA Project as member of the First Philippine Airports Consortium. He asserts that this rule is mala prohibita.
Another ground of disqualification raised by petitioner Osmeña III concerns the financial and technical capabilities of GMR
as his investigation and online research showed that GMR was in dire financial health.

Still, DOTC and MCIAA issued the Notice of Award to GMR-Megawide Consortium.

ISSUE: Whether petitioners have legal standing to file the petitions

RULING: Yes. In any case, locus standi being a mere procedural technicality, the Court has, in the exercise of its discretion,
relaxed the rules on standing when the issues involved as of "transcendental importance" to the public.

The Court, through Associate Justice Florentino P. Feliciano (retired and now deceased), provided the following instructive
guides as determinants in determining whether a matter is of transcendental importance:
(1) the character of the funds or other assets involved in the case;
(2) the presence of a clear case of disregard of a constitutional or statutory prohibition by the public respondent agency or
instrumentality of the government; and
(3) the lack of any other party with a more direct and specific interest in the questions being raised.

Here, BPM alleges a direct personal injury for its members who as frequent travelers to Cebu and Mactan will be burdened
by the increased terminal fees imposed by the private respondents upon taking over the operation and management of MCIA.
On the other hand, petitioner Osmeña III claims to be suing as a legislator, taxpayer and citizen asserting a public right in
the stringent application of the bidding rules on the qualifications of private respondents for the MCIA Project.

In not a few cases, the Court, in keeping with its duty under the Constitution to determine whether the other branches of
government have kept themselves within the limits of the Constitution and the laws and have not abused the discretion given
them, has brushed aside technical rules of procedure.

In Agan v. PIATCO, also involving a controversy in the qualifications of the winning bidder for the construction and
operation of the country's premier international airport, the Court resolved to grant standing to the petitioners in view of
"the serious legal questions involved and their impact on public interest." Although the factual milieu in this case is not
similar and no constitutional issue was raised by petitioners, we hold that the same rationale in Agan justifies the relaxation
of the rules on standing.

BBRB, Inc. vs. NLDC

G.R. No. 194589, September 21, 2015

FACTS: The case sprouts from a collection suit filed by the respondent against the petitioner bank prior to the declaration
of the Monetary Board that it will be placed on receivership. And during the pendency of the case,
the said declaration was made appointing PDIC as the receiver of the petitioner bank pursuant to RA 7653.

After being placed into receivership, the respondent filed a motion for substitution invoking Section 19, Rule 3 of the
Revised Rules of Court and claimed that by virtue of transfer of interest of the petitioner bank to the PDIC, the latter may
be substituted as party or joined with the original party. Despite opposition, the trial court granted the motion.

Contending that the substitution is not proper in the instant case since the PDIC is not the real party in interest but was
merely tasked to keep the assets of the bank for the benefit of its creditors, petitioner bank raised the matter before the SC on
question of law via Petition for review on Certiorari.

ISSUE: Whether or not substitution of PDIC as defendant should be granted

RULING: No. PDIC, being a fiduciary of the petitioner bank, may prosecute or defend the case as a representative party
but, the petitioner bank will still be included in the case since it still remains as the real party in interest as stated in Sec. 3,
Rule 3 of the Revised Rules of Court. The PDIC merely remains as a representative party.

Guizano, et al. vs. Veneracion

G.R. No. 191128, September 12, 2012

FACTS : This case involves two parcels of land in Bulacan inherited by siblings Lucia and Nicasio Bernardino. Nicasio
sold his entire share to petitioner while Lucia sold a portion of her share to respondent. Nicasio’s share sold to petitioner
was then registered under a TCT in the name of Emmanuel Guizano, petitioner’s son.
Petitioner later discovered that Lucia’s share sold to respondent was actually part of the property sold to her by Nicasio.
Respondent then filed a complaint against petitioner and Lucia, praying that petitioner reconvey the parcel of land in his
favor. In her Answer, petitioner claimed that the complaint was without merit because it was directed against petitioner,
who is not the real party in interest as she was not the registered owner of the property. It was Emmanuel, who was not even
impleaded.

RTC Malolos dismissed the complaint but CA reversed the RTC decision and ordered petitioner to convey the property to
respondent. Petitioner, however, died during the pendency of the case, so her heirs filed a Rule 45 petition before the SC..

ISSUE: Whether respondent’s complaint should be dismissed for not being filed against the real party-in-interest

RULING: Yes. An action for reconveyance is an action in personam, for it binds a particular individual only, although it
concerns the right to an intangible thing. Being an action in personam, any judgment in this action is binding only upon the
parties properly impleaded. This is in keeping with the principle that every action must be prosecuted or defended in the
name of the real party-in-interest, i.e., the party who stands to be benefited or injured by the judgment in the suit, or the
party entitled to the avails of the suit, as embodied in Sec. 2, Rule 3 of the Rules of Court. Emmanuel is the real party-in-
interest and respondent should have filed the action against him.

Moreover, respondent filed the complaint against petitioner either as owner or as attorney-in-fact of Emmanuel. However,
Emmanuel never authorized petitioner to be his attorney-in-fact. Even if she was authorized in a power of attorney executed
by Emmanuel, an attorney-in-fact is still not a party-in-interest and Emmanuel must still be impleaded.

Spouses Tabalno vs. Dingal, sr.

G.R. No. 191526, October 5, 2015

FACTS: The present petition traces its roots to the Forcible Entry case, docketed as filed by respondent Paulino Dingal, sr.
against petitioner spouses Tabalno and others. The MCTC ruled in favor of respondent and ordered petitioners to vacate.
The petitioners then appealed the MCTC decision to the RTC. Respondent Paulino Dingal, sr. sought the dismissal of the
petitioners’ appeal and prayed for the issuance of a writ of execution. RTC granted respondent’s request for a writ of
execution.

While the forcible entry case was still pending appeal before the RTC, the petitioners filed with the CA a petition for review
under Rule 42 of the Rules of Court. However, this was dismissed by the CA. RTC then affirmed in toto MCTC’s decision.
2 months later, The RTC granted the manifestation with omnibus ex parte motion for substitution filed by respondent Juanita
Galola Vda. de Dingal (Juanita); the RTC ordered the substitution of Paulino (who in the interim died) by his surviving
spouse Juanita.

The petitioners charge the RTC with grave abuse of discretion in granting the substitution of Paulino by his wife Juanita.
The petitioners argue that, first, under Section 4, Rule 3 of the Rules of Court, the husband and the wife shall sue or be sued
jointly, except as may be provided by law. In this case, Juanita was not joined as a party in Paulino’s forcible entry case;
hence, her participation in the proceedings is deemed waived. Accordingly, she could no longer be substituted as a party in
the case as the MCTC decision had already been executed. Also, the RTC no longer had jurisdiction over the case when it
ordered Juanita’s substitution as the case was already then pending appeal before the CA.

ISSUE: Whether the substitution of Juanita, in place of her deceased husband, was legally proper

RULING: Yes. In this jurisdiction, there are three kinds of actions available for the recovery of possession of real property:
(1) accion interdictal or ejectment case; (2) accion publiciana; and (3) accion reivindicatoria. These actions survive the
death of a party. Under Section 16, Rule 3 of the Rules of Court, the heirs of a deceased party may be substituted for the
latter on a pending action where the claim is not thereby extinguished.

Forcible entry, as well as unlawful detainer, belongs to the class of action known as accion interdictal where the issue is the
right of physical or material possession of the subject real property that, therefore, survives the death of a party.

We are of course aware of Section 4, Rule 3 of the Rules of Court that requires the husband and the wife to sue jointly,
otherwise, the non-joining spouse is deemed to have waived his or her participation in the proceeding. We note, however,
that Juanita did not join the proceeding pursuant to Section 4 of Rule 3 when she, as Paulino’s wife, should have sued jointly
with Paulino. Rather, Juanita joined the proceeding pursuant to Section 16 of Rule 3 which allows her, as her husband’s
heir, to substitute for Paulino in the case. In other words, she was merely taking over her husband’s place, not belatedly
joining as an additional party, to protect Paulino’s rights and interests that the proceedings may affect.

In this regard, the Court explained in Edwino A. Torres (deceased) v. Rodellas: the purpose for allowing the heirs to
substitute for the deceased litigant proceeds from “the right to due process of every party to a litigation who may be affected
by the intervening death. The deceased litigant is himself or herself protected, as he/she continues to be properly represented
in the suit through the duly appointed legal representative of his estate. The spirit behind the general rule requiring a formal
substitution of heirs is not really because substitution of heirs is a jurisdictional requirement, but because noncompliance
therewith results in the undeniable violation of the right to due process of those who, though not duly notified of the
proceedings, are substantially affected by the decision rendered therein.” Accordingly, the RTC correctly allowed Juanita
to substitute for Paulino upon the latter’s death.

CG3AM, Inc. vs. Chua

G.R. No. 191170, September 4, 2016

FACTS: Respondents obtained an initial loan of P4 million from Metrobank. The loan was secured by a real estate mortgage
constituted over three parcels of land located in Parañaque City (subject property). For failure of respondents to pay,
Metrobank sought the extrajudicial foreclosure of the real estate mortgage. Seeking to stop the intended public auction,
respondents filed a Complaint for injunction with prayer for the issuance of a temporary restraining order (TRO),
preliminary injunction and damages.

The Regional Trial Court issued a TRO. However, upon the expiration of the TRO, Metrobank scheduled another public
auction. On the morning of the auction, RTC issued an Order directing Metrobank to reschedule the intended sale to a date
after the resolution of the application for preliminary injunction. However, the latter allegedly received the Order 4 days
later and pushed through with the scheduled public auction. The application for preliminary injunction filed by respondents
was denied by RTC for mootness in view of the consummated public auction sale. When their motion for reconsideration
was denied, respondents filed a petition for certiorari before the CA. CA ruled in favor of respondents and remanded the
case for further proceedings.

Meanwhile, respondents filed a Motion to Admit Amended Complaint with attached Amended Verified Complaint for
annulment of foreclosure of mortgage, declaration of nullity of certificate of sale, and injunction.

Petitioner, on the other hand, filed a Motion for Joinder of Party and/or Substitution. Metrobank sold to Asia Recovery
Corporation (ARC) its credit against respondents including all rights, interests, claims and causes of action arising out of
the loan and mortgage agreements between Metrobank and respondents. ARC, in turn, specifically assigned the credit to
petitioner through a Deed of Assignment. Petitioner prayed that it be substituted in lieu of Metrobank in the proceedings
before RTC.

The RTC granted the motion and ordered petitioner to be joined as party-defendant, but without dropping Metrobank as
defendant. However, reversed the RTC’s decision. Hence, this petition.

ISSUE: Whether petitioner may be joined as party-defendant

RULING: Yes. In case of a transfer of interest, the court, upon motion, may direct the person to whom the interest is
transferred to be substituted in the action or joined with the original party.

Indeed, a transferee pendente lite is a proper party that stands exactly in the shoes of the transferor, the original party.
Transferees are bound by the proceedings and judgment in the case, such that there is no need for them to be included or
impleaded by name. We have even gone further and said that the transferee is joined or substituted in the pending action by
operation of law from the exact moment when the transfer of interest is perfected between the original party and the
transferee.

PANTRANCO NORTH EXPRESS, INC., vs. STANDARD INSURANCE COMPANY

G.R. No. 140746

Permissive joinder of parties requires that: (a) the right to relief arises out of the same transaction or series of transactions;
(b) there is a question of law or fact common to all the plaintiffs or defendants; and (c) such joinder is not otherwise
proscribed by the provisions of the Rules on jurisdiction and venue. (Rule 3, Sec. 6)

FACTS: Crispin Gicale was driving the passenger jeepney owned by his mother Martina Gicale. Alexander Buncan, on the
other hand, was driving a bus owned by Pantranco North Express Inc. The passenger bus overtook the jeepney. In so doing,
the passenger bus hit the left rear side of the jeepney and sped away.

The total cost of the repair amounted to P21, 415. Standard, the insurance company, only paid P8,000 while Martina Gicale
shouldered the remaining P13,415. Thereafter, Standard and Martina demanded reimbursements from Pantranco and
Buncan, but the bus company and the driver refused. Thus, Standard and Martina were prompted to file a complaint for sum
of money with the RTC of Manila.

Pantranco and Buncan denied the allegations of the complaint and asserted that it is the MeTC which has jurisdiction over
the case.

ISSUE: Whether or not the RTC has jurisdiction over the subject of the action

RULING: No. Respondents’ cause of action against petitioners arose out of the same transaction. Thus, the amount of the
demand shall be the totality of the claims. Respondent Standards claim is P8,000.00, while that of respondent Martina Gicale
is P13,415.00, or a total of P21,415.00. Section 19 of B.P. Blg. 129 provides that the RTC has exclusive original jurisdiction
over all other cases, in which the demand, exclusive of interest and cost or the value of the property in controversy, amounts
to more than twenty thousand pesos (P20,000.00).
Basis:
1. there is a single transaction common to all, that is, Pantrancos bus hitting the rear side of the jeepney. There is also
a common question of fact, that is, whether petitioners are negligent. There being a single transaction common to
both respondents, consequently, they have the same cause of action against petitioners. (Refer to main point)
2. where there are several claims or causes of action between the same or different parties, embodied in the same
complaint, the amount of the demand shall be the totality of the claims in all the causes of action, irrespective of
whether the causes of action arose out of the same or different transactions. (totality rule as exemplified by Section
33 (1) of B.P. Blg. 129)

GO vs. DPDC, INC.

G.R. No. 194024, April 25, 2012

FACTS:

1. Philip L. Go, Pacifico Q. Lim and Andrew Q. Lim (petitioners) are registered individual owners of condominium
units in Phoenix Heights Condominium developed by the respondent.

2. Distinction Properties Development and Construction, Inc. (DPDCI) is a real estate developer, engaged in the
development of condominium projects, among which was the Phoenix Heights Condominium.

3. Petitioner Pacifico Lim, one of the incorporators and the then president of DPDCI, executed a Master Deed and
Declaration of Restrictions (MDDR) of Phoenix Heights Condominium, which was filed with the Registry of Deeds.
As the developer, DPDCI undertook, among others, the marketing aspect of the project, the sale of the units and the
release of flyers and brochures.

4. Thereafter, Phoenix Heights Condominium Corporation (PHCC) was formally organized and incorporated.
Sometime in 2000, DPDCI turned over to PHCC the ownership and possession of the condominium units.

5. DPDCI and PHCC made certain transactions affecting some facilities in the condominium.

6. Petitioners filed a complaint before the HLURB against DPDCI for unsound business practices and violation of the
MDDR, alleging that DPDCI committed misrepresentation in their circulated flyers and brochures as to the facilities
or amenities that would be available in the condominium and failed to perform its obligation to comply with the
MDDR.

7. In defense, DPDCI alleged that the brochure attached to the complaint was “a mere preparatory draft”. HLURB
rendered its decision in favor of petitioners. DPDCI filed with the CA its Petition for Certiorari and Prohibition on
the ground that HLURB acted without or beyond its jurisdiction.

8. The CA ruled that the HLURB had no jurisdiction over the complaint filed by petitioners as the controversy did not
fall within the scope of the administrative agency’s authority.

ISSUES: Whether PHCC is an indispensable party

HELD: Yes. An indispensable party is defined as one who has such an interest in the controversy or subject matter that a
final adjudication cannot be made, in his absence, without injuring or affecting that interest. It is "precisely ‘when an
indispensable party is not before the court that an action should be dismissed.’ The absence of an indispensable party renders
all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even to
those present. The purpose of the rules on joinder of indispensable parties is a complete determination of all issues not only
between the parties themselves, but also as regards other persons who may be affected by the judgment.

PHCC is an indispensable party and should have been impleaded, as it would be directly and adversely affected by any
determination therein. Evidently, the cause of action rightfully pertains to PHCC.

CRISOLOGO vs. JAI Corp

G.R. No. 196894, March 3, 2014

FACTS:
 1. RTC-Br. 8, Davao City rendered its decision in favor of one Sy Sen Ben, the plaintiff in a collection case, against
defendants Robert Limso, So Keng Kok, et al. The defendants were directed to transfer the subject properties in
favor of Sy Sen Ben. The latter subsequently sold the subject properties to one Nilda Lam who, in turn, sold the
same to JEWM. TCT Nos. 325675 and 325676 were then eventually issued in the name of JEWM, both of which
still bearing the same annotations as well as the notice of lis pendens in connection with the other pending cases
filed against So Keng Kok.

2. A year thereafter, SpousesJesus G. Crisologo and Nannette B. Crisologo prevailed in the separate collection case
filed before RTC-Br. 15, Davao City against Robert Limso, So Keng Kok, et al. Thus, the said defendants were
ordered to solidarily pay the Spouses Crisologo. After the issuance of writ of execution, the Branch Sheriff
issued a notice of sale scheduling an auction the properties covered by TCT Nos. 325675 and 325676, now,
in the name of JEWM.

3. To protect its interest, JEWM filed a separate action before RTC-Br. 14 for cancellation of lien with prayer for the
issuance of a preliminary injunction, cancellation of all the annotations on the back of the pertinent
TCTs; and the issuance of a permanent injunction order after trial on the merits.

4. The counsel then of spouses Crisologo questioned the authority of the said court to restrain the execution
proceedings in RTC-Br. 15.

5. But JEWM opposed it on the ground that Spouses Crisologo were not parties in the case. No motion
to intervene was, however, filed as the Spouses Crisologo believed that it was unnecessary since they were
already the John and Jane Does named in the complaint of JEWM.

ISSUE: Whether or not Spouses Crisologo are considered as indispensable parties in the case for cancellation of lien.

RULING: Yes. In an action for the cancellation of memorandum annotated at the back of a certificate of title, the persons
considered as indispensable include those whose liens appear as annotations. In Southwestern University v.
Laurente, the Court held that the cancellation of the annotation of an encumbrance cannot be ordered without giving notice
to the parties annotated in the certificate of title itself. It would, thus, be an error for a judge to contend that no notice is
required to be given to all the persons whose liens were annotated at the back of a certificate of title. Here, undisputed is the
fact that Spouses Crisologo’s liens were indeed annotated at the back of TCT Nos. 325675 and 325676.Thus, as persons
with their liens annotated, they stand to be benefited or injured by any order relative to the cancellation of annotations in
the pertinent TCTs. In other words, they are as indispensable as JEWM itself in the final disposition of the case for
cancellation, being one of the many lien holders. As indispensable parties, Spouses Crisologo should have been joined as
defendants in the case pursuant to Section 7, Rule 3 of the Rules of Court. The reason behind this compulsory joinder of
indispensable parties is the complete determination of all possible issues, not only between the parties themselves but also
as regards other persons who may be affected by the judgment. In this case, RTC-Br. 14, despite repeated pleas
by Spouses Crisologo to be recognized as indispensable parties, failed to implement the mandatory import of the aforecited
rule

ARON vs. REALON, ET. AL.

G.R. No. 159156, January 31, 2005

FACTS: Roman Realon was the owner of two parcels of land which was inherited by Alfredo Realon and his siblings.
Sometime in 1979, Alfredo executed a contract to sell his undivided portion of the lot to petitioner. He also obliged himself
to execute a deed of final sale. However Alfredo failed to register the sale. To secure the balance of the purchase price, Aron
mortgage the property to the remaining heir. Alfredo Realon died and his successors were unaware about the sale. Engineer
Ilaban, the attorney-in-fact of Aron, filed a case for consignation against the heir of Realon. The Realon’s countered by
contending that undue influence was present at the execution of the sale and that the balance of the price due in the contract
to sell was not paid. Aron contended that the contract to sell was superseded by the deeds of the sale with mortgage.in
response, the Realons contended that even the other heirs did not receive the proceeds from the contract itself allegedly
executed by Alfredo. The Regional Trial Court held that there was fraud present.

ISSUE: Whether or not the other heirs of Alfredo are the real parties in interest.

HELD: The well settled rule is that every action must be prosecuted and defended in the name of the real party in interest.
Thus, the presence of all indispensable party is a condition sine qua non for the existence of judicial power. The plaintiff is
mandated to implead all indispensable party and in the absence of one render all subsequent judgment voids. Failure to
include the other heirs as indispensable parties in the complaint to nullify the contract to sell is fatal to the complaint.

The surviving signatories of the assailed deeds and the other heirs of the deceased vendors were not impleaded as plaintiffs.
Without the presence of all the other heirs as plaintiffs, the trial court could not validly render judgment and grant relief in
favor of the respondents; it could, likewise, not rule in favor of the petitioner for the refund of his payments made to the
respondents as the successors-in-interest of the vendors. The failure of the respondents to implead the said signatories and
all the other heirs as parties-plaintiffs constituted a legal obstacle to the trial court and the appellate court’s exercise of
judicial power over the said case, and thereby rendered any orders or judgments made therein a nullity. To reiterate, the
absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not
only as to the absent parties, but even as to those present. Thus, the RTC should have ordered the dismissal of the complaint.

GUY, ET. AL. vs. GUY

G.R. No. 189486, September 5, 2012

FACTS:

1. Gilbert is the son of spouses Francisco and Simny. Simny, one of the petitioners, however, alleged that it was she
and her husband who established GoodGold, putting the bulk of its shares under Gilbert’s name. Simny further
claimed that upon the incorporation of GoodGold, they issued stock certificates reflecting the shares held by each
stockholder including Stock Certificate Nos. 004-014 under Gilbert’s name.

2. Later on, the aging Francisco wanted to redistribute GoodGold’s shareholdings evenly among his children, namely,
Gilbert, Grace Grace, Geraldine, and Gladys, while maintaining a proportionate share for himself and his wife,
Simny.

3. Gilbert filed a Complaint for the "Declaration of Nullity of Transfers of Shares in GoodGold and of General
Information Sheets and Minutes of Meeting, and for Damages with Application for a Preliminary Injunctive Relief,"
against his mother, Simny, and his sisters, Geraldine, Grace, and Gladys. Gilbert alleged, among others, that no
stock certificate ever existed; that his signature at the back of the spurious Stock Certificate Nos. 004-014 which
purportedly endorsed the same and that of the corporate secretary, Emmanuel Paras, at the obverse side of the
certificates were forged, and, hence, should be nullified. Gilbert’s complaint essentially prayed for the return of his
original 519,997 shares in GoodGold, by praying that the court declare that "there were no valid transfers of the
contested shares to defendants and Francisco."

ISSUE: Whether or not the case should be dismissed.

RULING: Yes. The absence of an indispensable party in a case renders all subsequent actions of the court null and void
for want of authority to act, not only as to the absent parties but even as to those present.

Gilbert omitted Francisco as defendant in his complaint. While Gilbert could have opted to waive his shares in the name of
Francisco to justify the latter’s non-inclusion in the complaint, Gilbert did not do so, but instead, wanted everything back
and even wanted the whole transfer of shares declared fraudulent. This cannot be done, without including Francisco as
defendant in the original case. The transfer of the shares cannot be, as Gilbert wanted, declared entirely fraudulent without
including those of Francisco who owns almost a third of the total number.

Settled is the rule that joinder of indispensable parties is compulsory being a sine qua non for the exercise of judicial power,
and, it is precisely "when an indispensable party is not before the court that the action should be dismissed" for such absence
renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but
even as to those present.

It bears emphasis that Gilbert, while suing as a stockholder against his co-stockholders, should have also impleaded
GoodGold as defendant. His complaint also prayed for the annulment of the 2004 stockholders’ annual meeting, the
annulment of the 2004 election of the board of directors and of its officers, the annulment of 2004 GIS submitted to the
SEC, issuance of an order for the accounting of all monies and rentals of GoodGold, and the issuance of a writ of preliminary
and mandatory injunction. We have made clear that GoodGold is a separate juridical entity distinct from its stockholders
and from its directors and officers. The trial court, acting as a special commercial court, cannot settle the issues with finality
without impleading GoodGold as defendant. Like Francisco, and for the same reasons, GoodGold is an indispensable party
which Gilbert should have impleaded as defendant in his complaint.

LBP v Cacayuran
GR 191667 2015

Facts: The Municipality of Agoo, La Union contracted two loans from petitioner LBP to finance the redevelopment of the
Agoo Public Plaza. The first loan was to finance the phase 1 of the plan while the second loan was to finance the construction
of a commercial center on the Plaza. The construction of the commercial center was objected by some of the residents led
by respondent Cacayuran.

These residents conducted a signature campaign and Cacayuran wrote a letter addressed to the Sangguniang Bayan
expressing the public clamor against the said construction. Cacayuran also requested for various documents related to the
plan for the sake of public information and transparency.

Unable to get any response, Cacayuran filed a complaint against the officers of the Sangguniang Bayan and petiitoner LBP
assailing the validity of the Subject Loans on the ground that the Plaza Lot used as collateral thereof is property of public
dominion and therefore, beyond the commerce of man.
Petitioner asserted that Cacayuran did not have a cause of action against it since he was not privy to any of the Subject
Loans. During the pendency of the case, the construction of the commercial center was completed and declared as
patrimonial property of the Municipality through a Municipal Ordinance.

The trial court ruled in favor of Cacayuran finding that the Plaza lot is proscribed from collateralization given its nature as
property for public use. On appeal, the CA ruled that Cacayuran had locus standi to file his complaint being a resident of
the Municipality and that the issue involved public interest of transedental importance.

Issue: Whether Cacayuran has no cause of action since he was not privy to any of the subject loans

Ruling: No. A taxpayer is allowed to sue where there is a claim that public funds are illegally disbursed, or that public
money is being deflected to any improper purpose. A person suing as a taxpayer, however, must show that the act
complained of directly involves the illegal disbursement of public funds derived from taxation.

As a resident-taxpayer, Cacayuran is directly affected by the conversion of the Agoo Plaza which was funded by the
proceeds of the Subject Loans, which had already been converted into public funds by the Municipality's receipt thereof.

Cacayuran need not be privy to the Subject Loans in order to proffer his objections thereto. In Mamba v. Lara, it has been
held that a taxpayer need not be a party to the contract to challenge its validity; as long as taxes are involved, people have a
right to question contracts entered into by the government.

CTTI, Inc. v Abejar

GR 170631 2016

FACTS: Jesmariane Reyes was walking along Sampaguita St., Paranaque City when an L-300 van, swerved to its left and
hit Reyes in the latter's attempt to avoid an incoming vehicle. A witness to the accident went to her aid and loaded her in
the back of the van and told the driver to bring her to the hospital. Instead of doing so, the driver appeared to have left the
van parked inside a nearby subdivision with Reyes still in the van. Fortunately for Reyes, an unidentified civilian came to
help and drove her to the hospital. Upon investigation, it was found that the registered owner of the van was petitioner,
Caravan, and also the driver's employer. Caravan paid for Reyes' hospitalization expenses. Two days later, she died.
Respondent Abejar, Reyes' paternal aunt and the person who raised her since she was 9 years old, filed a complaint for
damages against the driver and petitioner Caravan. Summons could not be served on the driver so he was dropped as
defendant. The trial court found the driver grossly negligent in driving the vehicle and awarded damages in favor of Abejar.
Court of Appeals affirmed the decision with modification, reducing moral damages from 300k to 200k.

Caravan argues that Abejar has no personality to bring this suit because she is not a real party in interest. According to
Caravan, Abejar does not exercise legal or substitute parental authority. She is also not the judicially appointed guardian or
the only living relative of the deceased. She is also not "the executor or administrator of the estate of the deceased."

ISSUE: Whether Abejar is a real party in interest who may bring an action for damages against petitioner

RULING: Yes. Rule 3, Section 2 of the Rules of Court provides that ”To qualify a person to be a real party in interest in
whose name an action must be prosecuted, he [or she] must appear to be the present real owner of the right sought to be
enforced.” Article 216 of the Family Code identifies the persons who exercise substitute parental authority including the
child's actual custodian, over twenty-one years of age, unless unfit or disqualified.

Respondent's capacity to file a complaint against petitioner stems from her having exercised substitute parental authority
over Reyes.

Both of Reyes' parents and paternal grandparents are deceased while the whereabouts of maternal grandparents are
unknown. There is also no record that Reyes has brothers or sisters. It was under these circumstances that respondent took
custody of Reyes when she was a child, assumed the role of Reyes' parents, and thus, exercised substitute parental authority
over her.

DAMA v NPC
GR 156208 2014

FACTS: The Court previously declared void and without legal effect NPB Resolution, which directed the termination from
the service of all employees of the NPB in line with its restructure. The Court subsequently granted petitioners' motion for
execution.

PSALM filed a manifestation stating that petitioners did not furnish it a copy of their manifestation wherein they prayed to
enforce the Court's Resolution by garnishment/levy upon NPC's assets including to the assets of PSALM. Not being a party
in the case, PSALM said it is not bound by the judgment rendered by the Court. It added that PSALM is mandated to
privatize the transferred NPC generation assets, real estate and other disposable assets, and to apply the proceeds thereof to
the payment of all existing and outstanding NPC financial obligations and stranded contract costs in an optimal manner.
Petitioners contend that a writ of execution may be issued against non-parties, including the PSALM which is the successor-
in-interest of NPC, now the owner of the financial obligations/liabilities of NPC and shall be considered as one with NPC
and the liability of the latter shall attach to the former.

ISSUE: Whether PSALM being a non-party to the case may be held liable for NPC’s liability

RULING: Yes. PSALM took ownership over most of NPCs assets. There was indeed a transfer of interest over these assets
from NPC to PSALM by operation of law. These properties may be used to satisfy our judgment. This being the case,
petitioners may go after such properties. The fact that PSALM is a non-party to the case will not prevent the levying of the
said properties, including their fruits and proceeds. However, PSALM should not be denied due process. The levying of
said properties and their fruits/proceeds, if still needed in case NPCs properties are insufficient to satisfy our judgment, is
without prejudice to PSALMs participation in said proceedings. Its participation therein is necessary to prevent the levying
of properties other than that it had acquired from NPC. Such a proceeding is to be conducted in the proper forum where
petitioners may take the appropriate action. (See Sec. 19, Rule 3)

Carandang v Heirs of de Guzman

GR 160347

FACTS: Quirino de Guzman and herein petitioners spouses Arcadio and Ma. Luisa Carandang are stockholders as well as
corporate officers of Mabuhay Broadcasting System. MBS' capital stock was increased and parts of the increase were
subscribed by petitioners. De Guzman claims that part of the payment for these subscriptions were paid by him and that
petitioners refused to pay the amount. Petitioners that a pre-incoporation agreement was executed between Arcadio
Carandang and de Guzman, whereby the latter promised to pay for the stock subscriptions of the former without cost, in
consideration for Arcadio 's technical expertise, his newly purchased equipment, and his skill in repairing and upgrading
radio/communication equipment therefore, there is no indebtedness on their part.

De Guzman filed a complaint against herein petitioners seeking to recover the amount together with damages. The trial
court ordered the spouses Carandang to pay de Guzman. Court of Appeals affirmed trial court’s decision.

The spouses Carandang claims that the Decision of the RTC, having been rendered after the death of de Guzman, is void
for failing to comply with Section 16, Rule 3 of the Rules of Court, in adherence to the Court’s pronoucnements in Vda. de
Haberer v. Court of Appeals and Ferreria v. Vda. de Gonzales.

ISSUE: Whether failure to comply with the above rule renders void the decision of the RTC

RULING: No. Unlike jurisdiction over the subject matter which is conferred by law and is not subject to the discretion of
the parties, jurisdiction over the person of the parties to the case may be waived either expressly or impliedly. Implied waiver
comes in the form of either voluntary appearance or a failure to object.

In the cases cited by petitioners, we held that there had been no valid substitution by the heirs of the deceased party, and
therefore the judgment cannot be made binding upon them. In the case at bar, not only do the heirs of de Guzman interpose
no objection to the jurisdiction of the court over their persons; they are actually claiming and embracing such jurisdiction.
In doing so, their waiver is not even merely implied, but express (by their explicit espousal of such view in both the Court
of Appeals and in this Court). The heirs of de Guzman had no objection to being bound by the Decision of the RTC.

Nevertheless, the case at bar had already been submitted for decision before the RTC on 4 June 1998, several months before
the passing away of de Guzman on 19 February 1999. Hence, no further proceedings requiring the appearance of de
Guzman’s counsel were conducted before the promulgation of the RTC Decision. Consequently, de Guzman’s counsel
cannot be said to have no authority to appear in trial, as trial had already ceased upon the death of de Guzman.

Pacana-Contreras v RWS
GR 160347

FACTS: Petitioners Rebecca and Rosalie children of Lourdes and Luciano all surnamed Pacana, filed the present case
against respondents Rovila Inc., Earl, Lilia, Dalla and Marisa for accounting and damages.

The petitioners claimed that their family is engaged in the water supply business operating under the name of “Rovila Water
Supply” from their family residence. The petitioners alleged that respondent Lilia was their former trusted employee,
conspired with respondents to form the respondent corporation to takeover and illegally usurp the family business’ registered
name.

The petitioners filed the complaint in their own names although Rosalie was authorized by Lourdes through a sworn
declaration and SPA. The respondents filed a first motion to dismiss on the ground that the RTC had no jurisdiction over an
intra-corporate controversy. The RTC denied the motion.

Then, Lourdes died so the petitioners amended their complaint, with leave of court. They still attached to their amended
complaint the sworn declaration with SPA, but the caption of the amended complaint remained the same. Thereafter,
Luciano also died. The petitioners’ sister, Lagrimas Pacaña-Gonzales, filed a motion for leave to intervene and her answer-
in-intervention was granted by the trial court.

At the subsequent pre-trial, the respondents manifested to the RTC that a substitution of the parties was necessary in light
of the deaths of Lourdes and Luciano. Respondents filed the second motion to dismiss on the ground that petitioners are not
the real parties in interest to prosecute the case.

The trial court ruled that a motion to dismiss on the grounds invoked by respondents may only be filed before the filing of
their answer to the amended complaint and that the rule on substitution of parties only applies when the parties to the case
die, which is not what happened in the present case.

On appeal, the respondents argued that the deceased spouses Luciano and Lourdes, not the petitioners, were the real parties
in interest. The CA granted the petition and ruled that the RTC committed grave abuse of discretion as the petitioners filed
the complaint and the amended complaint as attorneys-in-fact of their parents. As such, they are not the real parties in
interest and cannot bring an action in their own names.

ISSUE: Whether petitioners are real parties in interest

RULING: Yes. Both the spouses Pacaña were not impleaded as parties-plaintiffs. The Court notes, however, that they are
indispensable parties to the case as the alleged owners of Rovila Water Supply. Without their inclusion as parties, there can
be no final determination of the present case. They possess such an interest in the controversy that a final decree would
necessarily affect their rights, so that the courts cannot proceed without their presence. Their interest in the subject matter
of the suit and in the relief sought is inextricably intertwined with that of the other parties.

The Court is of the view that the proper remedy in the present case is to implead the indispensable parties especially when
their non-inclusion is merely a technical defect. To do so would serve proper administration of justice and prevent further
delay and multiplicity of suits Pursuant to Section 9, Rule 3 of the Rules of Court, parties may be added by order of the
court on motion of the party or on its own initiative at any stage of the action.

Obviously, in the present case, the deceased Pacañas can no longer be included in the complaint as indispensable parties
because of their death during the pendency of the case. Upon their death, however, their ownership and rights over their
properties were transmitted to their heirs, including herein petitioners, pursuant to Article 774 in relation with Article 777
of the Civil Code.

Negotiation as to repurchase also takes place. GSIS scheduled the subject property for a 2nd public bidding after a failed
negotiation with Fernando to buy back his property.

Resident Marine Mammals of the Protected Seascape Tañon Strait vs. Reyes
G.R. No. 180771 April 21, 2015

MAINPOINT: Ponente J. Leonardo-de Castro: The Court passed the landmark Rules of Procedure for Environmental
Cases, which allow for a “citizen suit,” and permit any Filipino citizen to file an action before our courts for violations of
our environmental laws. (ISSUE ON LOCUS STANDI)

Impleading the former President as an unwilling co-petitioner, for an act she made in the performance of the functions of
her office, is contrary to the public policy against embroiling the President in suits, “to assure the exercise of Presidential
duties and functions free from any hindrance or distraction, considering that being the Chief Executive of the Government
is a job that, aside from requiring all of the office holders time, also demands undivided attention.”

CONCURRING OF LEONEN: View that extending the application of “real party-in-interest” to the Resident Marine
Mammals, or animals in general, through a judicial pronouncement will potentially result in allowing petitions based on
mere concern rather than an actual enforcement of a right.

FACTS: Before Us are two consolidated Petitions filed under Rule 65 of the 1997 Rules of Court, concerning Service
Contract No. 46 (SC-46), which allowed the exploration, development, and exploitation of petroleum resources within
Tañon Strait, a narrow passage of water situated between the islands of Negros and Cebu. The Petition docketed as G.R.
No. 180771 is an original Petition for Certiorari, Mandamus, and Injunction, which seeks to enjoin respondents from
implementing SC-46 and to have it nullified for willful and gross violation of the 1987 Constitution and certain international
and municipal laws. Likewise, the Petition docketed as G.R. No. 181527 is an original Petition for Certiorari, Prohibition,
and Mandamus, which seeks to nullify the Environmental Compliance Certificate (ECC) issued by the Environmental
Management Bureau (EMB) of the Department of Environment and Natural Resources (DENR), Region VII in connection
with SC-46; to prohibit respondents from implementing SC-46; and to compel public respondents to provide petitioners
access to the pertinent documents involving the Tañon Strait Oil Exploration Project.

Petitioners in G.R. No. 180771, collectively referred to as the “Resident Marine Mammals” in the petition, are the toothed
whales, dolphins, porpoises, and other cetacean species, which inhabit the waters in and around the Tañon Strait. They are
joined by Gloria Estenzo Ramos (Ramos) and Rose-Liza Eisma-Osorio (Eisma-Osorio) as their legal guardians and as
friends (to be collectively known as “the Stewards”) who allegedly empathize with, and seek the protection of, the
aforementioned marine species. Also impleaded as an unwilling co-petitioner is former President Gloria Macapagal-Arroyo,
for her express declaration and undertaking in the ASEAN Charter to protect the Tañon Strait, among others. Petitioners in
G.R. No. 181527 are the Central Visayas Fisherfolk Development Center (FIDEC), a non-stock, nonprofit,
nongovernmental organization, established for the welfare of the marginal fisherfolk in Region VII; and Cerilo D. Engarcial
(Engarcial), Ramon Yanong (Yanong) and Francisco Labid (Labid), in their personal capacities and as representatives of
the subsistence fisherfolk of the municipalities of Aloguinsan and Pinamungajan, Cebu.

Named as respondents in both petitions are the late Angelo T. Reyes, as then Secretary of the Department of Energy (DOE);
Jose L. Atienza, as then Secretary of the DENR; Leonardo R. Sibbaluca, as then DENR-Regional Director for Region VII
and Chairman of the Tañon Strait Protected Seascape Management Board; Japan Petroleum Exploration Co., Ltd. (JAPEX),
a company organized and existing under the laws of Japan with a Philippine branch office; and Supply Oilfield Services,
Inc. (SOS), as the alleged Philippine agent of JAPEX.

ISSUES: 1. WON Petitioner (resident marine mammals) may be considered as real party in interest and may have locus
standi?

2. WON they can implead President Arroyo as unwilling co-petitioner under sec 10 rule 3?

RULING:1.YES. The Court passed the landmark Rules of Procedure for Environmental Cases, which allow for a “citizen
suit,” and permit any Filipino citizen to file an action before our courts for violations of our environmental laws. Even
before the Rules of Procedure for Environmental Cases became effective, this Court had already taken a permissive position
on the issue of locus standi in environmental cases. In Oposa v. Factoran, Jr., 224 SCRA 792 (1993), we allowed the suit
to be brought in the name of generations yet unborn “based on the concept of intergenerational responsibility insofar as the
right to a balanced and healthful ecology is concerned.” Furthermore, we said that the right to a balanced and healthful
ecology, a right that does not even need to be stated in our Constitution as it is assumed to exist from the inception of
humankind, carries with it the correlative duty to refrain from impairing the environment. In light of the foregoing, the need
to give the Resident Marine Mammals legal standing has been eliminated by our Rules, which allow any Filipino citizen,
as a steward of nature, to bring a suit to enforce our environmental laws. It is worth noting here that the Stewards are joined
as real parties in the Petition and not just in representation of the named cetacean species. The Stewards, Ramos and Eisma-
Osorio, having shown in their petition that there may be possible violations of laws concerning the habitat of the Resident
Marine Mammals, are therefore declared to possess the legal standing to file this petition.(J. De Castro, Ponente)

In our jurisdiction, persons and entities are recognized both in law and the Rules of Court as having standing to sue and,
therefore, may be properly represented as real parties-in-interest. The same cannot be said about animals. Animals play an
important role in households, communities, and the environment. While we, as humans, may feel the need to nurture and
protect them, we cannot go as far as saying we represent their best interests and can, therefore, speak for them before the
courts. As humans, we cannot be so arrogant as to argue that we know the suffering of animals and that we know what
remedy they need in the face of an injury. (concurring of J. Leonen)

2. NO. Section 10, Rule 3 of the Rules of Court provides: Sec. 10. Unwilling co-plaintiff.—If the consent of any party who
should be joined as plaintiff can not be obtained, he may be made a defendant and the reason therefor shall be stated in the
complaint. Under the foregoing rule, when the consent of a party who should be joined as a plaintiff cannot be obtained, he
or she may be made a party defendant to the case. This will put the unwilling party under the jurisdiction of the Court, which
can properly implead him or her through its processes. The unwilling party’s name cannot be simply included in a petition,
without his or her knowledge and consent, as such would be a denial of due process. Moreover, the reason cited by the
petitioners Stewards for including former President Macapagal-Arroyo in their petition, is not sufficient to implead her as
an unwilling co-petitioner. Impleading the former President as an unwilling co-petitioner, for an act she made in the
performance of the functions of her office, is contrary to the public policy against embroiling the President in suits, “to
assure the exercise of Presidential duties and functions free from any hindrance or distraction, considering that being the
Chief Executive of the Government is a job that, aside from requiring all of the office holder’s time, also demands undivided
attention.” Therefore, former President Macapagal-Arroyo cannot be impleaded as one of the petitioners in this suit. Thus,
her name is stricken off the title of this case. ( J. De Castro)

View that petitioners should not take it upon t Besides, Former President Gloria Macapagal-Arroyo cannot be a party to this
suit. As a coequal constitutional department, we cannot assume that the President needs to enforce policy directions by
suing his or her alter
hemselves to simply implead any party who does not consent as a petitioner. egos. The procedural situation caused by
petitioners may have gained public attention, but its legal absurdity borders on the contemptuous. The Former President’s
name should be stricken out of the title of this case. (concur J. Leonen)

DECISION: WHEREFORE, the Petitions in G.R. Nos. 180771 and 181527 are GRANTED, Service Contract No. 46 is
hereby declared NULL AND VOID for violating the 1987 Constitution, Republic Act No. 7586, and Presidential Decree
No. 1586.

Bulawan vs. Aquende

G.R. No. 182819 June 22, 2011
MAINPOINT: Section 7, Rule 3 of the Rules of Court defines indispensable parties as parties in interest without whom no
final determination can be had of an action. An indispensable party is one whose interest will be affected by the court’s
action in the litigation. As such, they must be joined either as plaintiffs or as defendants.

FACTS: Petitioner Bulawan claimed that she is the owner of a certain parcel of land (Lot No. 1634-B). She filed a complaint
for annulment of title, reconveyance and damages against Lourdes Yap who claimed to be the owner of the same property.
In her answer, Yap claimed that it’s Lot No. 1634-A that she owned while the Aquende family owned Lot No. 1634-B.

Trial Court ruled in favor of Bulawan as the rightful owner and possessor. Yap appealed but the CA dismissed it. Register
of Deeds informed respondent Aquende of the trial court’s writ of execution against his property. Aquende alleged that he
was unaware of any litigation involving his property having received no summons or notice of adverse claim.

Aquende filed a Third Party Claim against the writ of execution because it affected his property and that he is not bound by
the trial court’s decision for not being a party to it. The Clerk of Court said that a Third Party Claim was not the proper
remedy because the sheriff did not levy upon or seize his property. He then filed a Notice of Appearance with Third Party
Motion but this was also denied.

Thereafter, he filed a petition for annulment of judgment before the CA due to extrinsic fraud and lack of jurisdiction. He
argued that there was extrinsic fraud when Bulawan failed to implead him despite her knowledge of the existing title in his
name and thus, prevented him from participating in the proceedings and protecting his title. Also, he is an indispensable
party and the trial court did not acquire jurisdiction over his person because he was not impleaded in the case. CA ruled in
favor of Aquenda.

ISSUES: 1. WON annulment of judgment is the proper remedy

2. WON Aquende is a proper party to sue for the annulment of the judgment

RULING:
1.YES. The judgment may be annulled as there was extrinsic fraud and lack of jurisdiction under Rule 47, Sec. 2 of RoC.
Fraud is extrinsic where it prevents party from having a trial or from presenting his entire case to the court. It is the fraudulent
scheme of the prevailing litigant which prevented a party from having his day in court. in this case, Aquende was prevented
from protecting his title when Bulawan failed to implead him as a party. Also, trial court did not acquire jurisdiction over
his person as he was not a party to it.
2.YES. Aquende’s lot and Bulawan’s lot refer to the same lot no. 1634-B. Aquende is an indispensable party as his interest
will be affected by the court’s action in the litigation. As such, he must be joined as plaintiff as defined in Sec. 7, Rule 3 of
RoC.
Autocorp Group vs. Intra Strata Assurance Corporation
G.R. No. 166662. June 27, 2008

MAINPOINT: The misjoinder of parties does not warrant the dismissal of the action.—The misjoinder of parties does not
warrant the dismissal of the action. Section 11, Rule 3 of the Rules of Court explicitly states: SEC. 11. Misjoinder and non-
joinder of parties.—Neither misjoinder nor non-joinder of parties is ground for dismissal of an action. A necessary party
is one who is not indispensable but who ought to be joined as a party if complete relief is to be accorded as to those already
parties, or for a complete determination or settlement of the claim subject of the action.

Where the Bureau of Customs, through the Solicitor General, was not the one who initiated the case, and neither was its
consent obtained for the filing of the same, it may be considered an unwilling co-plaintiff in said action, and the proper way
to implead it as a necessary party should be in accordance with Section 10, Rule 3 of the Rules of Court.

FACTS: Autocorp Group, represented by its President, Rodriguez, secured an ordinary re-export bond from private
respondent Intra Strata Assurance Corporation (ISAC) in favor of public Bureau of Customs (BOC), to guarantee the re-
export of 2 units of car (at 2 different dates) and/or to pay the taxes and duties thereon. Petitioners executed and signed two
Indemnity Agreements with identical stipulations in favor of ISAC, agreeing to act as surety of the subject bonds

In sum, ISAC issued the subject bonds to guarantee compliance by petitioners with their undertaking with the BOC to re-
export the imported vehicles within the given period and pay the taxes and/or duties due thereon. In turn, petitioners agreed,
as surety, to indemnify ISAC for the liability the latter may incur on the said bonds. Autocorp failed to re-export the items
guaranteed by the bonds and/or liquidate the entries or cancel the bonds, and pay the taxes and duties pertaining to the said
items, despite repeated demands made by the BOC, as well as by ISAC. By reason thereof, the BOC considered the two
bonds forfeited. Failing to secure from petitioners the payment of the face value of the two bonds, ISAC filed with the RTC
an action against petitioners to recover a sum of money plus Attorney’s Fee. ISAC impleaded the BOC “as a necessary
party plaintiff in order that the reward of money or judgment shall be adjudged unto the said necessary plaintiff.” Petitioners
filed a MTD, which was denied. RTC ordered Autocorp to pay ISAC and/or BOC the face value of the subject bonds plus
AF. Autocorp’s MR was denied. CA affirmed the trial court’s decision. MR was denied. Hence this Petition for Review on
Certiorari

ISSUES:
1. WON the BOC has been improperly impleaded and would be a ground for a dismissal of the case?
2. WON the BOC is a necessary party?
RULING:1. NO. In its assailed Decision, the Court of Appeals did not find merit in petitioners’ arguments on the matter,
holding that when the BOC forfeited the subject bonds issued by ISAC, subrogation took place so that whatever right the
BOC had against petitioners were eventually transferred to ISAC. As ISAC merely steps into the shoes of the BOC, whatever
defenses petitioners may have against the BOC would still be available against ISAC. The Court likewise cannot sustain
petitioners’ position. The misjoinder of parties does not warrant the dismissal of the action. Section 11, Rule 3.

2.The subject matter of Civil Case No. 95-1584 is the liability of Autocorp Group to the BOC, which ISAC is also bound
to pay as the guarantor who issued the bonds therefor. Clearly, there would be no complete settlement of the subject matter
of the case at bar—the liability of Autocorp Group to the BOC—should Autocorp Group be merely ordered to pay its
obligations with the BOC to ISAC. BOC is, therefore, a necessary party in the case at bar, and should not be dropped
as a party to the present case. NOTE:the government becomes a real party in interest when he is sued!!

It can only be conceded that there was an irregularity in the manner the BOC was joined as a necessary party in Civil Case
No. 95-1584. As the BOC, through the Solicitor General, was not the one who initiated Civil Case No. 95-1584, and
neither was its consent obtained for the filing of the same, it may be considered an unwilling co-plaintiff of ISAC in
said action. The proper way to implead the BOC as a necessary party to Civil Case No. 95-1584 should have been in
accordance with Section 10, Rule 3 of the Rules of Court, viz.:

“SEC. 10. Unwilling co-plaintiff.—If the consent of any party who should be joined as plaintiff can not be obtained,
he may be made a defendant and the reason therefor shall be stated in the complaint.”

Nonetheless, the irregularity in the inclusion of the BOC as a party to Civil Case No. 95-1584 would not in any way affect
the disposition thereof. As the Court already found that the BOC is a necessary party to Civil Case No. 95-1584, it would
be a graver injustice to drop it as a party.

Juana Complex I Homeowners Association, Inc. vs. Fil-Estate Land, Inc

G.R. No. 152272. March 5, 2012.

MAINPOINT: With respect to the issue that the case was improperly instituted as a class suit, the Court finds the opposition
without merit. he necessary elements for the maintenance of a class suit are: 1) the subject matter of controversy is one of
common or general interest to many persons; 2) the parties affected are so numerous that it is impracticable to bring them
all to court; and 3) the parties bringing the class suit are sufficiently numerous or representative of the class and can fully
protect the interests of all concerned.

FACTS: JCHA et.al. (Homeowners Association, individual residents of Juana Complex I and neighboring subdivisions)
instituted an action for damages, in its own behalf and as a class suit, against Fil-Estate.

The complaint alleged that plaintiffs are regular commuters and motorists who constantly travel along SLEX through a
public road known as La Paz Road for more than 10 years. However, Fil-Estate deliberately excavated, ruined, and closed
said road, which made it not passable to motorists and pedestrians. Despite complaints, Fil-Estate failed to make repairs on
the road, causing damage and inconvenience to motorists.

Fil-Estate filed a motion to dismiss, alleging that the complaint failed to state a cause of action and that it was improperly
filed as a class suit. RTC denied the motion to dismiss. CA upheld the RTC.

PETITIONER’S ARGUMENT(S): While they agree with the CA that the complaint sufficiently stated a cause of action,
they disagree with the pronouncement that full-blown trial on the merits was necessary. They claim that during the hearing
on the application of the writ of injunction, they had sufficiently proven that La Paz Road was a public road and that
commuters and motorists of their neighboring villages had used this road as their means of access toschools, churches, etc.

They also point out that La Paz Road has attained the status and character of a public road or burdened by an apparent
easement of public right of way.

RESPONDENT’S ARGUMENT(S): JCHA, et al. failed to prove the existence of a right of way or a right to pass over La
Paz Road and that the closure of the said road constituted an injury to such right. According to them, La Paz Road is a
torrens registered private road and there is neither a voluntary nor legal easement constituted over it.

ISSUE: 1 WON the complaint states a cause of action;

2. WON the complaint has been properly filed as a class suit;
3. WON a writ of preliminary injunction is warranted

RULING: 1. YES The test of sufficiency of facts alleged in the complaint as constituting a cause of action is whether or
not admitting the facts alleged, the court could render a valid verdict in accordance with the prayer of said complaint.
In the present case, the Court finds the allegations in the complaint sufficient to establish a cause of action. First, JCHA, et
al.s averments in the complaint show a demandable right over La Paz Road. These are: (1) their right to use the road on the
basis of their allegation that they had been using the road for more than 10 years; and (2) an easement of a right of way has
been constituted over the said roads. There is no other road as wide as La Paz Road existing in the vicinity and it is the
shortest, convenient and safe route towards SLEX Halang that the commuters and motorists may use. Second, there is an
alleged violation of such right committed by Fil-Estate, et al. when they excavated the road and prevented the commuters
and motorists from using the same. Third, JCHA, et al. consequently suffered injury and that a valid judgment could have
been rendered in accordance with the relief sought therein.

2. YES The necessary elements for the maintenance of a class suit are: 1) the subject matter of controversy is one of common
or general interest to many persons; 2) the parties affected are so numerous that it is impracticable to bring them all to court;
and 3) the parties bringing the class suit are sufficiently numerous or representative of the class and can fully protect the
interests of all concerned.

In this case, the suit is clearly one that benefits all commuters and motorists who use La Paz Road.

The subject matter of the instant case, i.e., the closure and excavation of the La Paz Road, is initially shown to be of common
or general interest to many persons. The records reveal that numerous individuals have filed manifestations with the lower
court, conveying their intention to join private respondents in the suit and claiming that they are similarly situated with
private respondents for they were also prejudiced by the acts of petitioners in closing and excavating the La Paz Road.
Moreover, the individuals sought to be represented by private respondents in the suit are so numerous that it is impracticable
to join them all as parties and be named individually as plaintiffs in the complaint. These individuals claim to be residents
of various barangays in Binan, Laguna and other barangays in San Pedro, Laguna.

3.NO A writ of preliminary injunction is available to prevent a threatened or continuous irremediable injury to parties before
their claims can be thoroughly studied and adjudicated. The requisites for its issuance are: (1) the existence of a clear and
unmistakable right that must be protected; and (2) an urgent and paramount necessity for the writ to prevent serious damage.
For the writ to issue, the right sought to be protected must be a present right, a legal right which must be shown to be clear
and positive. This means that the persons applying for the writ must show that they have an ostensible right to the final
relief prayed for in their complaint.

In the case at bench, JCHA, et al. failed to establish a prima facie proof of violation of their right to justify the issuance of
a WPI. Their right to the use of La Paz Road is disputable since they have no clear legal right therein.

Consequently, the case should be further heard by the RTC so that the parties can fully prove their respective positions on
the issues.

Banda vs. Ermita

G.R. No. 166620. April 20, 2010.

MAINPOINT: Courts must exercise utmost caution before allowing a class suit, which is the exception to the requirement
of joinder of all indispensable parties.

An action does not become a class suit merely because it is designated as such in the pleadings; Whether the suit is or is
not a class suit depends upon the attending facts, and the complaint, or other pleading initiating the class action should
allege the existence of the necessary facts.

In determining the question of fair and adequate representation of members of a class, the court must consider (a) whether
the interest of the named party is coextensive with the interest of the other members of the class; (b) the proportion of those
made a party, as it so bears, to the total membership of the class; and (c) any other factor bearing on the ability of the
named party to speak for the rest of the class.

FACTS: The petitioners filed this action as a class suit on their own behalf and on behalf of all their co-employees at the
National Printing Office. They challenge the constitutionality of Executive Order No. 378 issued by President Gloria
Macapagal Arroyo which amended Sec. 6 of Executive Order No. 285, removing the exclusive jurisdiction of the NPO over
the printing services requirements of government agencies and instrumentalities. They perceive it as a threat to their security
of tenure as employees of the NPO contending that it is beyong the executive powers of Pres. Arroyo to amend or repeal
EO No. 285 issued by former Pres. Aquino when the latter still exercised legislative powers and that EO No. 378 violates
petioners’ security of tenure because it paves the way for the gradual abolition of the NPO.

ISSUE: Whether or not the petition is indeed qualified as a class suit.

RULING: NO. The Supreme Court ruled that an action does not become a class suit merely because it is designated as such
in the pleadings. Under Section 12, Rule 3 of the Rules of Court, When the subject matter of the controversy is one of
common or general interest to many persons so numerous that it is impracticable to join all as parties, a number of them
which the court finds to be sufficiently numerous and representative as to fully protect the interests of all concerned may
sue or defend for the benefit of all. Any party in interest shall have the right to intervene to protect his individual interest.
From the foregoing definition, the requisites of a class suit are: 1) the subject matter of controversy is one of common or
general interest to many persons; 2) the parties affected are so numerous that it is impracticable to bring them all to court;
and 3) the parties bringing the class suit are sufficiently numerous or representative of the class and can fully protect the
interests of all concerned.

Here, the petition failed to state the number of NPO employees who would be affected by the assailed Executive Order and
who were allegedly represented by petitioners. It was the Solicitor General, as counsel for respondents, who pointed out
that there were about 549 employees in the NPO. The 67 petitioners undeniably comprised a small fraction of the NPO
employees whom they claimed to represent. Subsequently, 32 of the original petitioners executed an Affidavit of Desistance,
while one signed a letter denying ever signing the petition, ostensibly reducing the number of petitioners to 34. We note that
counsel for the petitioners challenged the validity of the desistance or withdrawal of some of the petitioners and insinuated
that such desistance was due to pressure from people "close to the seat of power." Still, even if we were to disregard the
affidavit of desistance filed by some of the petitioners, it is highly doubtful that a sufficient, representative number of NPO
employees have instituted this purported class suit. A perusal of the petition itself would show that of the 67 petitioners who
signed the Verification/Certification of Non-Forum Shopping, only 20 petitioners were in fact mentioned in the jurat as
having duly subscribed the petition before the notary public. In other words, only 20 petitioners effectively instituted the
present case.

Indeed, in MVRS Publications, Inc. v. Islamic Da’wah Council of the Philippines, Inc., 396 SCRA 210 (2003), we observed
that an element of a class suit or representative suit is the adequacy of representation. In determining the question of fair
and adequate representation of members of a class, the court must consider (a) whether the interest of the named party is
coextensive with the interest of the other members of the class; (b) the proportion of those made a party, as it so bears, to
the total membership of the class; and (c) any other factor bearing on the ability of the named party to speak for the rest of
the class. Previously, we held in Ibañes v. Roman Catholic Church, that where the interests of the plaintiffs and the other
members of the class they seek to represent are diametrically opposed, the class suit will not prosper.

MOST REV. ARIGO, ET. AL. vs. SWIFT, ET. AL., G.R. No. 206510, September 16, 2014
(Class suit case)

FACTS: The USS Guardian is an Avenger-class mine countermeasures ship of the US Navy. In December 2012, the US
Embassy in the Philippines requested diplomatic clearance for the said vessel “to enter and exit the territorial waters of the
Philippines and to arrive at the port of Subic Bay for the purpose of routine ship replenishment, maintenance, and crew
liberty.” On January 6, 2013, the ship left Sasebo, Japan for Subic Bay, arriving on January 13, 2013 after a brief stop for
fuel in Okinawa, Japan.

On January 15, 2013, the USS Guardian departed Subic Bay for its next port of call in Makassar, Indonesia. On January 17,
2013 at 2:20 a.m. while transiting the Sulu Sea, the ship ran aground on the northwest side of South Shoal of the Tubbataha
Reefs, about 80 miles east-southeast of Palawan. No one was injured in the incident, and there have been no reports of
leaking fuel or oil.

Petitioners claim that the grounding, salvaging and post-salvaging operations of the USS Guardian cause and continue to
cause environmental damage of such magnitude as to affect the provinces of Palawan, Antique, Aklan, Guimaras, Iloilo,
Negros Occidental, Negros Oriental, Zamboanga del Norte, Basilan, Sulu, and Tawi-Tawi, which events violate their
constitutional rights to a balanced and healthful ecology.

ISSUE: Whether or not petitioners have legal standing.

RULING: Yes. On the novel element in the class suit filed by the petitioners minors in Oposa, this Court ruled that not
only do ordinary citizens have legal standing to sue for the enforcement of environmental rights, they can do so in
representation of their own and future generations. Thus: Petitioners minors assert that they represent their generation as
well as generations yet unborn. We find no difficulty in ruling that they can, for themselves, for others of their generation
and for the succeeding generations, file a class suit. Their personality to sue in behalf of the succeeding generations can
only be based on the concept of intergenerational responsibility insofar as the right to a balanced and healthful ecology is
concerned. Such a right, as hereinafter expounded, considers the “rhythm and harmony of nature.” Nature means the created
world in its entirety. Such rhythm and harmony indispensably include, inter alia, the judicious disposition, utilization,
management, renewal and conservation of the country’s forest, mineral, land, waters, fisheries, wildlife, off-shore areas and
other natural resources to the end that their exploration, development and utilization be equitably accessible to the present
as well as future generations. Needless to say, every generation has a responsibility to the next to preserve that rhythm and
harmony for the full enjoyment of a balanced and healthful ecology. Put a little differently, the minors’ assertion of their
right to a sound environment constitutes, at the same time, the performance of their obligation to ensure the protection of
that right for the generations to come.

IITC vs. COE, CORP., G.R. No. 183308

FACTS:
 1. Insular and Capital One and Planters are regularly engaged in trading, sale and purchase of Philippine treasury bills.
Then on May 10, 1994, Capital One wrote a letter to Insular demanding the physical delivery of the treasury bills
which the Capital one purchased.

2. Then on July 1, 1994, the 3 companies entered into a tripartite agreement wherein Planters assigned to Insular,
which in turn assigned to Capital one, bills with the total value of P50million. But despite the repeated demands,
Planters failed to deliver the balance worth of bills making Capital one likewise unable to deliver the remaining
bills to Insular.

3. RTC: the trial court ordered (a) IITC to pay COEC P17,056,608.00 with interest at the rate of 6% from June 10,
1994 until full payment and (b) PDB to pay IITC P136,790,000.00 with interest at the rate of 6% from March 21,
1995 until full payment.

4. CA: CA affirmed the RTC finding that IITC was not a mere conduit but rather a direct seller to COEC of the treasury
bills. The CA, however, absolved PDB from any liability, ruling that because PDB was not involved in the
transactions between IITC and COEC, IITC should have alleged and proved that PDB sold treasury bills to IITC.

5. Hence, this petition. IITC insists that it alleged in its Amended Complaint (by way of alternative cause of action)
that PDB directly and principally sold to IITC treasury bills worth ₱186,790,000.00. By suing PDB as an alternative
defendant, IITC did not acknowledge that PDB could not be held principally liable. On the contrary, by bringing
suit against PDB under an alternative cause of action, IITC set forth a claim against PDB as the principal seller of
the treasury bills. In addition, IITC categorically refuted PDB’s allegation that the former did not pay for the treasury
bills purchased from the latter. The judicial admissions of PDB during the course of the trial and in the Partial
Stipulation, that PDB received the proceeds of the manager’s checks issued by COEC as payment for COEC’s
purchase of treasury bills from IITC, contradict PDB’s defense that no payment was made by IITC for the said
treasury bills. Payment by COEC to PDB, upon IITC’s instructions, should be treated as a payment by a third person
with the knowledge of the debtor, under Article 1236 of the Civil Code. Thus, when PDB accepted COEC’s checks,
it became duty bound to deliver the treasury bills sold to IITC as the principal buyer.

ISSUES: Whether PDB has the obligation to deliver treasury bills to IITC.

HELD: Yes. The CA ruling that IITC impliedly did not have a principal cause of action because it merely sued PDB as an
alternative defendant is an extremely flawed and baseless supposition which runs counter to established law and
jurisprudence. The filing of a suit against an alternative defendant and under an alternative cause of action should not be
taken against IITC. Section 13, Rule 3 and Section 2, Rule 8 of the Rules of Civil Procedure explicitly allows such filing:

Rule 13, Section 13: Alternative defendants. — Where the plaintiff is uncertain against who of several persons he
is entitled to relief, he may join any or all of them as defendants in the alternative, although a right to relief against
one may be inconsistent with a right of relief against the other.

Rule 8, Section 2: Alternative causes of action or defenses. – A party may set forth two or more statements of a
claim or defense alternatively or hypothetically, either in one cause of action or defense or in separate causes of
action or defenses. When two or more statements are made in the alternative and one of them if made independently
would be sufficient, the pleading is not made insufficient by the insufficiency of one or more of the alternative
statements.

As discussed earlier, the Court is not granting IITC’s primary cause of action against COEC because IITC acted, not as a
mere conduit for the sale of shares by PDB to COEC as alleged by IITC, but rather as a principal purchaser of securities
from PDB and then later as a principal seller to COEC. By reason of this determination, COEC is allowed to offset its
outstanding obligation to deliver the remaining IITC T-Bills against the latter’s obligation to deliver the COEC T-Bills.
Consequently, IITC’s alternative action against the alternative defendant PDB should be considered in order for IITC to be
able to recover from PDB the ₱186,790,000.00 worth of treasury bills which had already been fully paid for.

PCIC vs. EMC, LTD, G.R. No. 175409

FACTS: On March 22, 1995, petitioner Philippine Charter Insurance Corporation (PCIC) filed with the RTC of Manila a
Complaint against Explorer Maritime Co., Ltd., et al. The complaint sought to recover from the respondents the sum of
P342,605.50, allegedly representing the value of lost or damaged shipment paid to the insured, interest and attorney’s fees.
On the same date, PCIC filed a complaint against Wallem Philippines Shipping, Inc., Asian Terminals, Inc., and Foremost
International Port Services, Inc., but in this instance, the fourth defendant is “the unknown owner of the vessel M/V
“Taygetus.”Answers and reply were respectively filed and the case was set for pre-trial conference by an ex parte motion
of PCIC. However, before the scheduled date of the pre-trial conference, PCIC filedits Amended Complaint and the
“Unknown Owner” of the vessel M/V “Explorer” and Asian Terminals, Inc. filed anew their respective answers with
counterclaims. A motion to dismiss the complaint was filed by Foremost International Port Services but was denied.

The “Unknown Owner” of the vessel M/V “Explorer” and Asian Terminals, Inc. filed also the motion to dismiss on the
ground that PCIC failed to prosecute its action for an unreasonable length of time which was opposed by the latter claiming
that the trial court has not yet acted on its Motion to Disclose which it purportedly filed where it prayed for the trial court
to order respondent Wallem Philippines Shipping, Inc. to disclose the true identity and whereabouts of defendant “Unknown
Owner of the Vessel M/V ‘Explorer.’”

The trial court dismissed the case, stating that PCIC failed to prosecute its action for an unreasonable length of time. PCIC
then moved for reconsideration upon knowing that its Motion to Disclose was mistakenly filed with another branch instead
in Branch 37 where the present case was pending. However, the trial court denied its motion for reconsideration.

PCIC, through its new counsel, appealed to the Court of Appeals which affirmed the decision of the RTC and later, denied
the motion for reconsideration of PCIC involving the same issue.

Feeling aggrieved, PCIC then filed with the Supreme Court a petition for review on certiorari. The Supreme Court later on
required the counsel for the “Unknown Owner” of said vessels to submit proof of identity.

ISSUE: Whether the Trial Court erred in dismissing the complaint of PCIC on the ground that it failed to prosecute its
action for an unreasonable length of time.

RULING: According to the Supreme Court, respondent Explorer Maritime Co., Ltd., which was then referred to as the
“Unknown Owner of the vessel M/V ‘Explorer,’” had already been properly impleaded pursuant to Section 14, Rule 3 of
the Rules of Court. The Rule states:

Section 14. Unknown identity or name of defendant – Whenever the identity or name of a defendant is unknown,
he may be sued as the unknown owner, heir, devisee, or by such other designation as the case may require; when
his identity or true name is discovered, the pleading must be amended accordingly.

As all the parties have been properly impleaded, the resolution of the Motion to Disclose was unnecessary for the
purpose of setting the case for pre-trial.

Hence, the Petition is of PCIC is DENIED and the Decision of the Court of Appeals is affirmed.

LADC vs. ESTITA, ET. AL., G.R. No. 162109

(Section 15, Rule 3 case)

FACTS:

1. The instant petition involves a vast tract of an agricultural land located in Davao del Sur. This land was leased by
the Government to Orval Hughes for a period of twenty-five (25) years. The lease actually expired on May 25, 1952,
it having been extended for three (3) years. Orval Hughes died and was survived by his five (5) heirs who then filed
their Sales Application with the Bureau of Lands. Teodulo Tocao, et al., filed a protest against the sales application.

2. The Office of the President gave due course to the applications to cover only 317 hectares at 63 hectares per heir
but awarded 399 hectares to 133 protesters [led by Teodulo Tocao] at three (3) hectares each.

3. The Ministry of Natural Resources issued an Order implementing said decision. However, the 133 petitioners listed
in the said Order were not in possession of the land allotted to them. So, they formed the Malalag Land Petitioners
Association, Inc. (The Association) headed by one Cecilio R. Mangubat Sr.

4. On the other hand, those in possession of the land sought the assistance of the Malalag Ventures Plantation Inc., in
its development into a viable banana production project to which the corporation acceded.

5. Meanwhile, the Supreme Court in Minister of Natural Resources vs. Heirs of Orval Hughes, sustained the OP
decision and it became final and executory.

6. The association, through its president Mr. Mangubat, sent a letter to the management of Lapanday Group of
Companies, Inc. manifesting that they were no longer interested in the government grant under the Order of the
Ministry of Natural Resources and offered to transfer and waive whatever interest they have over the subject land
for a monetary consideration.

7. It therefore came as a surprise when, later on, the individual respondents filed [against Lapanday and/or L.S.
Ventures, Inc., the Heirs of Orval Hughes, the DENR/COSLAP and Cecilio Mangubat, Sr.] the following cases:
forcible entry, reinstatement, nullification of affidavits of quitclaims, relinquishment, waiver and any other
documents on disposition of lands. They alleged that since 1947, they had been the share tenants-tillers, openly and
continuously, of the late Orval Hughes and his heirs and they remained as such on the 317 hectares land

8. The DAR Provincial Agrarian Reform Adjudicator of Digos, Davao del Sur, rendered judgment in favor of the
Malalag Ventures Plantation, Inc.
 9. In the present case, petitioner argues that the DARAB decision ordering Lapanday and/or L.S. Ventures Inc. to
restore [respondents] Maximo Estita et al. to their respective farm lots within the 317 hectares owned by the Hughes
Heirs, has no valid force and effect against petitioner because it is not a real party-in-interest, pointing out that
Lapanday and/or L.S. Ventures, Inc., are separate and distinct from petitioners corporate personality. Petitioner
asserts that Lapanday has no juridical personality, while the corporate life of L.S. Ventures Inc. has ceased when
said entity merged with petitioner in 1996. Moreover, petitioner points out that it has no business operations in
Davao del Sur where the land in question lies.

ISSUE: Is the contention of the petitioner correct.

RULING: No. it is basic in the law of procedure that misjoinder of parties is not a ground for the dismissal of an action, as
parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the
proceedings and on such terms as are just

Then, too, there is the rule that objections to defects in parties should be made at the earliest opportunity, that is, at the
moment such defect becomes apparent, by a motion to strike the names of the parties wrongly impleaded. For, objections
to misjoinder cannot be raised for the first time on appeal.

Here, aside from unsubstantiated denials that it is not the party referred to in the complaint for forcible entry, etc.,
commenced by the respondents before the office of the Provincial Agrarian Reform Adjudicator of Digos, Davao del Sur,
petitioner did not even file a motion to strike its name in all the proceedings below.

Petitioners filing of an Answer has thereby cured whatever jurisdictional defect it now raises. As we have said time and
again, the active participation of a party in a case pending against him before a court or a quasi judicial body, is tantamount
to a recognition of that courts or bodys jurisdiction and a willingness to abide by the resolution of the case and will bar said
party from later on impugning the courts or bodys jurisdiction.

But even assuming, in gratia argumenti, that Lapanday does not have a juridical personality, it may nonetheless be sued
under such a name considering that respondents commonly know petitioner by the name Lapanday Group of Companies,
as shown in their alleged letter of intent to relinquish their rights over the subject land.

PACIFIC REHOUSE CORPORATION v. JOVEN L. NGO

FACTS: Petitioner entered into a Deed of Conditional Sale with Bautista for a parcel of land for a total of P7.3m Petitioner
was to make a down 2.1m upon its execution, with the balance to be paid upon completion by Bautista of the documents
necessary for the transfer. Despite receipt of payment of P6.5 Bautista failed and refused to execute the deed and even sold
the property to another. Hence petition for specific performance and damages and caused the annotation of a Notice of Lis
Pendens on TCT. However, before it could proceed, Bautista's counsel filed a Manifestation and Notice of Death RTC
directed Bautista's counsel to substitute the latter's heirs and/or representatives in the action pursuant to Section 16, Rule 3
of the Rules of Court. It held in abeyance the proceedings in said case until petitioner procures the appointment of an
executor or administrator pursuant to Section 16, Rule 3 of the ROC. Joven L Ngo filed a Verified Petition for Cancellation
of Notice of Lis Pendens alleging that Bautista owed him 8M secured by such property involved which was foreclosed and
sold to public auction upon failure to pay. The CA held that the complaint for specific performance and damages was an
action in personam since its object was to compel Bautista to perform his obligations under the Deed of Conditional Sale
and hence, rendered him pecuniarily liable. As such, the obligations in the contract attached to him alone and did not burden
the subject property. Since the action was founded on a personal obligation, it did not survive Bautista's death. Hence, the
CA concluded that the dismissal of the complaint by reason thereof, and not a resort to Section 16, Rule 3 of the Rules
of Court, was the proper course of action. The CA opined that the issue involving the propriety of the consolidation of the
two cases had become moot and academic.

ISSUE: whether or not the CA correctly dismissed the Case in view of Bautista's death.

RULING: Section 16, Rule 3 of the Rules of Court allows the substitution of a party-litigant who dies during the pendency
of a case by his heirs, provided that the claim subject of said case is not extinguished by his death. As early as in Bonilla
v. Barcena, the Court has settled that if the claim in an action affects property and property rights, then the action survives
the death of a party-litigant, viz.:

The question as to whether an action survives or not depends on the nature of the action and the damage sued for. In the
causes of action which survive the wrong complained affects primarily and principally property and property rights,
the injuries to the person being merely incidental, while in the causes of action which do not survive the injury
complained of is to the person, the property and rights of property affected being incidental.

In the instant case, although the CA correctly pointed out that the Case involves a complaint for specific performance and
damages, a closer perusal of petitioner's complaint reveals that it actually prays for, inter alia, the delivery of ownership of
the subject land through Bautista's execution of a deed of sale and the turnover of title in its favor. This shows that the
primary objective and nature of the case is to recover the subject property itself and thus, is deemed to be a real action.

IBAÑEZ VS HARPER
MAINPOINT: Formal substitution is not necessary when the heirs themselves voluntarily participated in the case.

FACTS: Spouses Ibañez (debtors) entered into a judicial compromise agreement with Francisco, Consuelo and Ma.
Consuelo (creditors). A lot was involved since it was the security given by the spouses in the loan agreement, from which
the compromise was rooted. When Francisco didnt receive payment yet, James Harper (legal representative of Francisco's
heirs) through his counsel filed to claim possession ovet the subject lot, for the non compliance of the compromise agreement.
Spouses opposed to such claiming that Francisco was already dead and no valid substitution was effected by the counsel.

RTC ruled that no valid substitution was made, thus, payment to Consuelo and Ma. Consuelo is considered compliance to
the compromise agreement.

Harper sought reconsideration alleging that the Spouses made it appear that Consuelo and Ma. Consuelo only remained as
parties to the exclusion of Francisco. RTC declared Harper cannot be a party to the case because of lack of valid substitution.

CA (certiorari under Rule 65) - ruled formal substitution is no longer necessary in this case where the heirs actively
participated in the proceedings. Hence the petition for certiorari filed by the spouses.

ISSUE: WN formal substitution of heirs is necessary.

RULING: No. This is one case when formal substitution can be dispensed with. The heirs, voluntarily participated in the
case. The rationale behind Sec 16 Rule 3 ROC (rule on substitution) is to apprise the heir or the substitute that is being
brought to the jurisdiction of the court in lieu of the deceased party by operation of law. It serves to protect the right of every
party to due process.

CARDENAS VS HEIRS OF AGUILAR

MAINPOINT: The purpose of substitution is for the protection of the right of the parties to due process. It is to ensure that
the deceased party would continue to be properly represented in the suit thru a duly appointed legal representative of his
estate.

FACTS: Alcantara obtained loan from Spouses Aguilar amounting to 3M + interest 720K, with a lot (subject property) as
security. Term of loan is 1 year, from Nov 2000 to Nov 2001, + 6 mos grace period.

Alcantara failed to pay and asked for extension which the daughter of the spouses granted. Dec 2002 - Cardenas (son of
Alcantara) wants to redeem the lot by offering to pay the entire amount + interest, but spouses refused. Alcantara filed a
civil case against the spouses and their daughter to accept payment and release property.

Case pending, alcantara died, and substituted by Cardenas. Also, the spouses died and counsel manifested in court by filing
a notice of death.

RTC - ordered the defendants to release property upon payment of the plaintiff.

Defendant filed motion to execute judgment, but said motion was opposed by the plaintiffs on the ground that the original
defendants (referring to the Spouses Aguilar) were now dead and no proper substitution was effected by the counsel pursuant
to Sec 16 Rule 3 ROC.

ISSUE: WN formal substitution of the heir is necessary in this case.

RULING: No. Formal substitution of the heir is no longer necessary when the heir actively participated in the proceedings.
The purpose of Sec 16 Rule 3 ROC on substitution is to protect the right of the parties to due process. In this case no right
to procedural due process was violated. The SC found this petition absurd, why the petitioner would oppose to a judgement
favorable to him. Petition is denied. RTC decision affirmed.

SALIGUMBA VS PALANOG

MAINPOINT: Section 17 is explicit that the duty of the court to order the legal representative or heir to appear arises only
upon proper notice. The notation Party-Deceased on the unserved notices could not be the proper notice contemplated by
the rule.

FACTS: Spouses Palanogs filed a complaint for Quieting of Title with Damages against spouses Saligumba, before the
RTC Kalibo Aklan alleging erse and continuous possession as owners for more than 50 years of a parcel of land. The
spouses Saligumbas allegedly prevented them from entering and residing on the subject premises and had destroyed the
barbed wires enclosing the land. Spouses Palanogs prayed that they be declared the true and rightful owners of the land in
question.

First Hearing - only the counsel of the Palanogs appeared. Trial court ordered the resetting of the hearing and directed the
Saligumbas to engage the service of another lawyer since their lawyer was appointed to be a judge of MTC.
The order sent to Mr. Saligumba was returned to the court unserved with the notation "Party Deceased" while the order sent
to Mrs. Saligumba was returned with the notation "Party in Manila".

2nd hearing - only the Counsel for the Paganogs again appeared. Hearing was again reset. Trial court held the lawyer on
record liable despite his appointment as judge until he withdraw as counsel. A copy of this order was sent to Valeria
Saligumba but the same was returned unserved with the notation "Party in Manila" 3rd hearing - hearing was again reset.
The trial court directed that a copy of this order be sent to Saligumba, Jr. (Son) at COA, PNB, Manila. 4th hearing - the
Palanog's presentation of evidence proceeded despite the manifestation of Saligumba's counsel that his client is sick. 5th
hearing - this was supposedly the schedule of Saligumba's presentation of evidence, but only the counsel of the Palanogs
appeared. Trial court ruled that the Saligumbas waived their right to present evidence.

2 years after - the trial court considered the case submitted for decision.

RTC decision August 1987- declared spouses Palanogs the lawful owners of the subject land and ordered spouses
Saligumbas, their agents, representatives and all persons acting in privity with them to vacate the premises and restore
possession to spouses Palanogs. May 1997 - Mrs. Palanog filed a motion to execute judgment (10 years after the decision).

RTC - denied motion since more than five years had elapsed after the date of its finality, the decision could no longer be
executed by mere motion.

Mrs Palanog filed a Complaint seeking to revive and enforce the Decision dated 7 August 1987 which she claimed has not
been barred by the statute of limitations.

Heirs of Saligumba answered that: (1) respondent had no cause of action; (2) the spouses Saligumbas died while the civil
case was pending and no order of substitution was issued and hence, the trial was null and void; and (3) the court did not
acquire jurisdiction over the heirs of the spouses Saligumbas and therefore, the judgment was not binding on them.

ISSUE: WN the trial court failed to order the legal representative of the deceased party despite it has knowledge of the
death of Mr Saligumba, as mandated by Sec 17 Rule 103 ROC.

RULING: No. Section 17 is explicit that the duty of the court to order the legal representative or heir to appear arises only
upon proper notice. The notation Party-Deceased on the unserved notices could not be the proper notice contemplated by
the rule. As the trial court could not be expected to know or take judicial notice of the death of a party without the proper
manifestation from counsel, the trial court was well within its jurisdiction to proceed as it did with the case. It appears that
Mr Saligumba died in 1984 while Mrs Saligumba died in 1985, before the trial court rendered judgment. No motion for the
substitution of the spouses was filed nor an order issued for the substitution of the deceased spouses Saligumbas in said
case. The Saligumba's counsel and Son Saligumba, Jr., despite notices sent to them to appear, never confirmed the death of
Spouses Saligumba. The record is bereft of any evidence proving the death of the spouses, except the mere notations in the
envelopes enclosing the trial courts orders which were returned unserved.

COMMISSIONER RODRIGUEZ VS JARDIN

MAINPOINT: Well-settled is the rule that failure to make a substitution pursuant to Section 17, Rule 3 of the Rules of
Court is a ground for the dismissal of an action. See Ruling below for requisites for a valid substitution of a public officer
xxx.

FACTS: Samuel A. Jardin, chief of the Bureau of Immigration's Law and Intelligence Division, arrived in the Philippines
from Osaka Japan, with a Japanese National suspiciously Linked to be a member of the Yakuza, because 1) his fifth finger
On his left hand was missing (mutilated) and 2) his name is Mizutani Ryoichiro, an alien declared undesirable and prohibited
from entering the Philippines.

Rufus Rodriguez, immigration commissioner at that time, ordered associate commissioner Ma. Luisa Ylagan-Cortez to
investigate the allegations contained in the spot report.

Respondent denied the allegations against him. He averred that his relatives requested his assistance in welcoming a niece's
fianc, Mizutani Ryoichiro. Although he was aware that a Mizutani Ryoichiro had been declared an undesirable alien, he
was informed that the blacklisted Ryoichiro was born in 1988 while his niece told him that her fianc was in his fifties.
Furthermore, respondent reasoned that the accusations against Ryoichiro were unfounded because neither a conviction nor
a police report linking Ryoichiro to the Yakuza was ever presented.

Ylagan-Cortez, as acting immigration commissioner, ordered the preventive suspension of respondent for 90 days. The
administrative case against respondent was then referred to petitioner Alan Roullo Yap, an associate commissioner at that
time, for formal investigation and reception of evidence. Respondent moved for the suspension of proceedings and
reconsideration but petitioner Yap denied his motion.

Respondent sought the review of the order by the Secretary of Justice.

Despite the lapse of his preventive suspension and pending the resolution of his appeal with the Secretary of Justice,
respondent filed a special civil action for certiorari with the CA CA - nullified the order and directed petitioners to reinstate
respondent to his position. Petitioners in their official capacities filed this appeal Contending that CA erred in its decision.
Respondent moved to declare the petition moot. He averred that petitioner Rodriguez had in the meantime been replaced by
Andrea D. Domingo as immigration commissioner while petitioner Yap had been appointed to the Office of the Government
Corporate Counsel. Despite the lapse of 30 days, no substitution was effected pursuant to Section 17, Rule 3 ROC.

ISSUE: WN there was no valid substitution as mandated by Sec 17 Rule 3 ROC, and thus the case must be dismissed.

RULING: Yes. Well-settled is the rule that failure to make a substitution pursuant to Section 17, Rule 3 of the Rules of
Court is a ground for the dismissal of an action. For the valid substitution of a public officer who has sued or has been sued
in his or her official capacity, the following requisites must be satisfied: 1. satisfactory proof by any party that there is
substantial need for continuing or maintaining the action; 2. the successor adopts or continues or threatens to adopt or
continue the acts of his or her predecessor; 3. the substitution must be effected within 30 days after the successor assumes
office or within the time granted by the court; and, 4. notice of the application to the other party. Petition denied.

CG3AM VS CHUA AND FILIDEN REALTY CORP.

FACTS: Respondents obtained a loan of 4M from Metrobank, secured by 4 parcels of land (subject property).

Because of failure to pay, Metrobank sought for extrajudicial foreclosure of the real estate mortgage over the subject
property. It sent them notice of the public auction.

Respondents filed a civil action for injunction against metrobank. Trial court issued a TRO, but after the expiration of the
TRO, metrobank rescheduled the public auction.

Metrobank received an order from the trial court to defer public auction until the resolution of the injunction case. However
such receipt was only after the public auction had already pushed thru.

RTC - injunction case is moot in view of the consummated public auction.

CA - reversed the decision and remanded the case back for further proceedings.

RTC judge inhibit, so case was re-raffled to another branch.

Respondents filed an amended complaint - now for annulment of foreclosure, declaration of nullity of certificate of sale and
injunction. Petitioner filed a motion for joinder and/or substitution by virtue of a Deed of Assignment executed by Asia
Recovery Corp, praying itd be substituted in lieu of Metrobank In the proceedings before the branch where the case was re-
raffled to. (Metrobank sold to ARC its credit against respondents and ARC assigned said credit to petitioner.)

RTC (where the case was re-raffled to) - granted the motion without dropping metrobank as a party. It ruled that metrobank
as a party is still necessary in the case until it presents evidence na it should be dropped.

CA - annulled the orders of RTC, because RTC ruled on provisional joinder/substitution. Also, it added that, petitioner
could not be substituted without disclosing the consideration it paid for the transfer of interest. Hence, the petition for review
on certiorari under rule 45.

ISSUE: WN the provisional joinder/substitution ordered by the RTC is contrary to the ROC, thus constituting gadalej.

RULING: No. Whether to allow joinder or substitution is largely a matter of discretion. That discretion is exercised in
pursuance of the paramount consideration that must be afforded for the protection of the parties ' interest ans the right to
due process. The ruling of the RTC is in accordance with Sec 11 Rule 3 ROC. CA, tho it erred in its decision, it correctly
ruled that disclosure of the consideration for the transfer of interest is a condition precedent for the joinder of the petitioner
in the proceedings. Petition is granted. CA decision reversed and set aside. RTC decision reinstated.

Siguion Reyna Montecillo and Ongsiako Law Offices vs. Chionlo-Sia

783 SCRA 56, G.R. No. 181186 February 3, 2016

FACTS: Petitioner Siguion Reyna Montecillo & Ongsiako Law Offices (SRMO) acted as counsel for Remedios N.
Rodriguez (Remedios) when she commenced an action for the intestate settlement of the estate of her deceased husband
Susano J. Rodriguez before the RTC of Lucena City. During the pendency of the intestate proceedings, Remedios asked for
the payment of widow’s allowance. This, however, was denied by the RTC. On review, the CA reversed the RTC’s Order
and granted Remedios a monthly widow’s allowance of P3,000.00.

While the case was pending before the CA, Remedios executed a Deed of Sale of Inheritance wherein she agreed to sell all
her rights, interests and participation in the estate of her husband to a certain Remigio M. Gerardo in consideration of
P200,000.00.
As a condition subsequent to the sale, Remedios, on March 1, 1988, executed a SPA authorizing Gerardo to, among others,
“receive from any person, entity, government agency or instrumentality, or from any court, any property, real or personal,
cash, checks or other commercial documents which may be due to me or payable to me by virtue of any contract, inheritance
or any other legal means,” and to “receive said property... in his own name and for his own account and to deposit the same
at his sole discretion for his own account, and dispose of [the] same without any limitation.” Gerardo later on executed a
document titled as “Substitution of Attorney-in-Fact,” where he designated SRMO as substitute attorney pursuant to the
power of substitution granted to him in the earlier SPA. Gerardo subsequently executed his own SPA authorizing SRMO

“[t]o appear... and represent [Gerardo] in any and all proceedings and incidents in the aforementioned case.”
After the CA’s decision regarding the widow’s allowance became final and executory, SRMO, accordingly filed a motion
with the RTC for the payment of the allowance then amounting to a total of P315,000.00. A few months after, the Estate
remitted to SRMO three (3) checks totaling this amount.

A Partial Project of Partition of the Estate was approved by the RTC. Remedios filed an “Urgent Omnibus Motion and
Notice of Termination of the Services of Petitioner’s Counsel of Record.” Therein, Remedios questioned the RTC’s Order
approving the partition and denied the execution of the Deed of Sale in favor of Gerardo. She also demanded that SRMO
return the amount it received from the partition. Before the motion could be resolved, however, Remedios filed a Notice of
Withdrawal of the same motion.

The withdrawal of the motion notwithstanding, the RTC, motu propio directed SRMO to reimburse the Estate the amount
of P315,000.00 representing the widow’s allowance it received in 1991.

In its Explanation with Motion to Excuse Reimbursement, SRMO moved to be excused from reimbursing the Estate.
According to SRMO, when it sought the payment of the widow’s allowance, it was merely seeking the enforcement of a
judgment credit in favor of its client, Remedios, who had, in turn, sold her interests to Gerardo, also represented by SRMO.

The RTC denied SRMO’s motion because (1) “the sale of inheritance was never made known” to the RTC and that (2) the
sale cannot comprehend a widow’s allowance because such allowance is “personal in nature.”

Aggrieved by the RTC’s orders, SRMO elevated the case to the CA through a petition for certiorari. SRMO argued that it
merely acted as representative of Gerardo, Remedios’ successor-in-interest, when it received the sum corresponding to the
widow’s allowance. Without going into the merits of the case, however, the CA denied SRMO’s petition on the ground that
the latter was not a party in the case before the lower court and therefore had no standing to question the assailed order. The
CA later denied SRMO’s motion for reconsideration. Hence, this case before the court.

SRMO is now contending that while it was not a party in the intestate proceedings, it is nevertheless an “aggrieved party”
which can file a petition for certiorari. It claims that the RTC’s order of reimbursement violated SRMO’s right to due
process. SRMO further argues that the RTC erred in ordering it to reimburse the widow’s allowance since SRMO received
said allowance only in favor of Gerardo as buyer of Remedios’ interests pursuant to the Deed of Sale.

In its Comment, the Estate maintains that SRMO has no standing to file the petition for certiorari as it is not “the real party-
in-interest who stands to lose or gain from the verdict [that] the Court may hand in the case at bar.” Having only acted in
the proceedings below as counsel for Remedios and, upon transfer of interest, for Gerardo, SRMO had no personality
independent of its client. Recognizing that SRMO received the amount not for its own benefit but only in representation of
its client, the Estate claims that SRMO is only being made to return the amount it received for and in behalf of its client; it
is not being made to pay out of its own pocket. The Estate also asserts that since Remedios already sold her share in the
estate to Gerardo she was no longer entitled to any widow’s allowance from that time on

ISSUE: WON SRMO is a real party-in-interest

RULING: Yes. A real party-in-interest is one “who stands to be benefited or injured by the judgment in the suit, or the
party entitled to the avails of the suit.” “Interest” within the meaning of the rule means material interest, an interest in issue
and to be affected by the decree, as distinguished from mere interest in the question involved, or a mere incidental interest.
By real interest is meant a present substantial interest, as distinguished from a mere expectancy or a future, contingent,
subordinate, or consequential interest. Simply put, a real party-in-interest is the person who will suffer (or has suffered) the
wrong. In this case, it is SRMO who stands to be injured by the RTC’s order of reimbursement considering that it is being
made to return money received on behalf of, and already accounted to, its client.

Vda de Santiago v. Atty. Suing

FACTS: Respondent Atty. Jose A. Suing (Atty. Suing) served as counsel for the plaintiff in Civil Case No. 59439, which
was filed before the Regional Trial Court (RTC) of Pasig City, Branch 71 on May 7, 1990.5 The original plaintiff, Eduardo
M. Santiago (Eduardo), sought the reconveyance of 91 parcels of land from the Government Service Insurance System
(GSIS). On October 18, 1994, Atty. Suing and Atty. Roberto R. Reverente (Atty. Reverente) entered their appearance as
Eduardo’s counsels.6 Unfortunately, Eduardo passed away on March 6, 1996.7 By virtue of the RTC Order8 dated March
27, 1996, Eduardo was substituted by his widow, Rosario.

Consequently, on May 8, 1996, Rosario entered into a Memorandum of Understanding (MOU)9 with Atty. Suing, Atty.
Reverente,10 and Atty. Wellington B. Lachica (Atty. Lachica). Said MOU pertinently states:

3. THAT [Atty. Suing, Atty. Reverente] and [Atty. Lachica] agree to render their legal services to [Rosario] on
a contingency basis and shall not collect acceptance nor advance legal fees from [Rosario] excepting only as are
consisting of out-of-pocket expenses, such as docket fees, sheriff fees and costs of stenographic notes and
photocopies or certified true copies of documents and other legal papers;

March 28, 2014, Atty. Antonio T. Vilar (Vilar) filed in the instant consolidated petitions a Motion for Leave of Court to
Intervene.[49] He alleged that before the RTC decided Civil Case No. 59439, the late Eduardo Santiago executed in his favor
two Deeds of Assignment of Rights dated November 14, 1989[50] and November 27, 1990.[51] By virtue thereof, Eduardo
purportedly transferred to Vilar ninety percent (90%) of the former's rights and interests in the excluded lots subject of the
said case.

Vilar averred that after the RTC rendered its Order dated September 17, 2010, which directed the issuance of an alias writ
of execution on the partial execution of P399,828,000.00, Vilar filed a Verified Omnibus Motion (For Substitution Of Party
Plaintiff With Authority To Implement Writ Of Execution Until Full Satisfaction Of The Final Judgment Of The
Court).[52]Vilar pointed out, however, that in the RTC Order dated December 8, 2010, the trial court merely noted his motion
without acting on the same.

Vilar assailed the aforesaid order in a petition for certiorari before the Court of Appeals, which was docketed as CA-G.R.
SP No. 117439. In a Decision dated February 10, 2014,[53]the Court of Appeals ruled in favor of Vilar. The appellate court
granted his Verified Omnibus Motion and he was ordered impleaded in Civil Case No. 59439 as party-plaintiff in
substitution of Rosario. The Court of Appeals further ruled that upon GSIS's payment of the amount of P399,828,000.00,
the Branch Sheriff of the trial court was directed to give to Vilar 90% of the 35% share of Rosario. The remaining 10% of
the 35% shall be deposited to Rosario's account.

Before this Court, Vilar argues that he is a transferee pendente lite in Civil Case No. 59439, to the extent of 90% of the
judgment award therein. He thus prays for an order allowing him to intervene and that the assailed rulings of the Court of
Appeals be reversed such that 90% of the 35% of the amount of P399,828,000.00 shall be awarded to him.

Rosarios’s Argument:
On Vistar’s intervention, Rosario argued that he has no legal interest insofar as the determination of attorney’s fees due to
Atty. Suing and Atty. Reverente was concerned given that he was not privy to the agreement between Rosario and said
lawyers. Vistar would allegedly not be affected by any adverse or favorable ruling on said issue. Rosario averred that
Vistar’s motion for intervention was belatedly filed and it was even untenable for him to claim that he was entitled to
intervene because the alleged assignment was made pendente lite. Rosario stated that Vistar’s alleged rights pursuant to a
purported assignment could best be asserted in a separate action. Thus, Rosario agreed with the ruling of the Court of
Appeals that denied Vistar’s intervention.

ISSUES: whether or not petitioner Vistar’s intervention was belatedly filed and whether or not petitioner Vistar can pursue
his claim against Rosario in the instant proceeding.

RULING: On Vistar’s petition, the Court resolves to DENY the same. We affirm the Court of Appeals’ denial of Vistar’s
intervention, albeit for different reasons.

Vistar derives his entitlement to intervene on the alleged fact that he was a transferee pendente lite of Rosario’s right, share
and participation in Civil Case No. 59439 equivalent to 50% of the judgment award. This transfer was in accordance with
the Agreement dated January 12, 2009 that Rosario purportedly executed in his favor during the pendency of Civil Case
No. 59439.

The right to intervene of a person who is a stranger to an action is governed by the provisions of Rule 19 of the Rules of
Court. Particularly, Sections 1 and 2 thereof provide:

SEC. 1. Who may intervene.—A person who has a legal interest in the matter in litigation, or in the success of
either of the parties, or an interest against both, or is so situated as to be adversely affected by a distribution or other
disposition of property in the custody of the court or of an officer thereof may, with leave of court, be allowed to
intervene in the action. The court shall consider whether or not the intervention will unduly delay or prejudice the
adjudication of the rights of the original parties, and whether or not the intervenor’s rights may be fully protected in
a separate proceeding.
SEC. 2. Time to intervene.—The motion to intervene may be filed at any time before rendition of judgment by
the trial court. A copy of the pleading-in-intervention shall be attached to the motion and served on the original
parties.
In a case involving a transfer of rights pending litigation, however, the applicable rule is Section 19, Rule 3, which
reads:

SEC. 19. Transfer of interest.—In case of any transfer of interest, the action may be continued by or
against the original party, unless the court upon motion directs the person to whom the interest is transferred
to be substituted in the action or joined with the original party.

Thus, in theory and assuming that there was a valid transfer of interest in Vistar’s favor, he need not intervene in these cases
anymore in order to protect his alleged property rights in the judgment award in Civil Case No. 59439. He is already bound
by the proceedings had in the case before 50% of Rosario’s rights was supposedly transferred to him and he is likewise
bound by the judgment in favor of Rosario.

However, the above discussion notwithstanding, the Court does not take cognizance of the fact that Vistar is indeed a
transferee pendente lite of half of Rosario’s rights to the judgment award by virtue of their Agreement. Contrary to what
Vistar is trying to impress upon this Court, the RTC made no definite ruling on the validity of the alleged Agreement in its
Order dated September 17, 2010. Far from recognizing the Agreement as embodying the true will of the parties thereto, the
trial court stressed that the veracity of the same was yet to be ascertained. Thereafter, the trial court simply gave Vistar the
personality and opportunity to participate in the negotiations for the settlement of the case. By no means was this a
recognition of Vistar’s status as a transferee pendente lite of Rosario’s rights.

On the part of the Court, we cannot make an independent ruling on the validity and due execution of the Agreement between
Vistar and Rosario for we are not a trier of facts. This is especially true when what was attached to the petitions before us
was a mere photocopy of the purported Agreement.

Therefore, in failing to substantiate the basis of his right thereto, Vistar’s intervention must be denied. To assert his alleged
claim against Rosario, Vistar should file a separate action in a court with proper jurisdiction.

PASDA, Inc. v. Dimayacyac (2016)

FACTS: In 1999, Petitioner PASDA, Inc. and respondent entered into a Contract of Lease of Suite 506 PASDA Mansion
in Quezon City. In 2005, Dimayacyac vacated the unit leaving an outstanding arrearage for monthly rentals, 10% VAT, and
utility costs, in the aggregate amount of P340,071.00. In spite of the lapse of the agreed 30-day period to settle his obligations
and the demand letters sent to him, he still failed to pay his outstanding obligation. On May 11, 2007, PASDA filed a
complaint for sum of money before the MeTC against Dimayacyac to collect the outstanding obligation in the amount of
P340,071.00.

MeTC: Dimayacyac is liable, but reduced the amount from P340,071.00 to P16,271.00 because it deducted the value of the
items confiscated by PASDA, which amounted to P323,800.00 and the interest rate from 2% per month to 6% per annum +
P20k attorney’s fees.

RTC: Affirmed.
CA: Affirmed with modification + P10k liquidated damages.
In the course of the proceedings before the CA, Dimayacyac died and he was substituted by his heirs as respondents.

ISSUE: Whether the heirs of respondent should not be made to pay but instead be enforced against the estate.

RULING: Yes. The procedure in vindicating monetary claims involving a defendant who dies before final judgment is
governed by Rule 3, Section 20 of the Rules of Civil Procedure, to wit:

When the action is for recovery of money arising from contract, express or implied, and the defendant dies before
entry of final judgment in the court in which the action was pending at the time of such death, it shall not be
dismissed but shall instead be allowed to continue until entry of final judgment. A favorable judgment obtained by
the plaintiff therein shall be enforced in the manner especially provided in these Rules for prosecuting claims
against the estate of a deceased person.

Pursuant to this provision, petitioner's remedy lies in filing a claim against the estate of the deceased respondent. The fact
that Dimayacyac's heirs have not instituted any action for the settlement of his estate does not warrant the conclusion that
the judgment award must be enforced against the individual heirs.

Accordingly, PASDA may recover the amount of P340,071.00, plus interest at the rate of six percent (6%) per annum,
P10,000.00 liquidated damages, and P20,000.00 as attorney's fees. The same may be enforced as a claim against the estate
of Reynaldo P. Dimayacyac, Sr. PASDA is, however, obligated to return the items it retained to his estate.
Pangcatan v. Maghuyop (2016)

FACTS: Pangcatan filed an action to recover various damages he had suffered in April 2002 from the vehicular accident
caused by the negligence of the defendants. Defendants Alexandro "Dodong" Maghuyop and Belindo Bankia, were
respectively the owner and driver of the passenger van that Pangcatan had hired to transport him and the goods he had
purchased in Pagadian City to his store in Margosatubig, Zamboanga del Sur. Based on the police report on the vehicular
accident, Bankiao had stopped his vehicle in the middle of the right lane of the highway in order to call for more passengers
when the dump truck of defendant Engr. Arnulfo Garcia then driven by defendant Eldefonso Densing suddenly bumped the
rear of the van, causing Pangcatan to lose consciousness. After Pangcatan regained consciousness in the hospital, he
discovered that his right leg had been fractured, and that he had lost all the goods he had bought in Pagadian City. Pangcatan's
complaint alleged that his estimated daily income before the accident was P400.00/day; that because of his injury, he could
never sell again or engage in any other business; and that his medical bills and the costs of his surgical operation would
easily run up to P500,000.00.

When he filed his complaint, Pangcatan also filed his Ex Parte Motion for Leave to File Case as Pauper Litigant, which the
RTC granted under the condition that the filing fees would constitute a first lien on any favorable monetary judgment that
he would recover from the suit. Instead of filing their answer, Maghuyop and Bankiao moved to dismiss the complaint
because the plaintiff, a well-known businessman and resident of Margosatubig, Zamboanga del Sur, was not an indigent
litigant.

RTC: denied the motion to dismiss.

CA: Remanded to RTC a quo to determine whether plaintiff-appellee can qualify as an indigent litigant; and, after which
to decide the case on the merits with dispatch.

ISSUE: Whether or not Pangcatan was exempt from the payment of filing and docket fees as an indigent litigant?

RULING: Yes. It is true that the non-payment of the filing fees usually prevents the trial court from acquiring jurisdiction
over the claim stated in the complaint, but for the CA to annul the judgment rendered after trial based solely on such non-
payment was not right and just considering that the non-payment of the filing fees had not been entirely attributable to the
plaintiff alone. The trial court was more, if not exclusively, to blame for the omission. For sure, all that Pangcatan had done
was to apply for the exemption, leaving to the RTC the decision whether or not to grant his application. Moreover, the CA
disregarded the fact that the RTC, through its order of September 4, 2002, had granted his Ex Parte Motion for Leave to
File Case as Pauper Litigant and had allowed him to litigate as an indigent party subject to the condition that the legal fees
would constitute a first lien on the monetary judgment to be rendered after trial.

Frias, Jr. vs. Sorongon

FACTS: On May 24, 2007, petitioner and Rogelio Veneracion (predecessor of petitioner heirs) filed before the
Mandaluyong City RTC a complaint3 for declaration of nullity of certificates of title with damages against respondents First
Asia Realty Development Corporation and/or SM Prime Holdings, Inc. (First Asia Realty/SM) and Ortigas & Company
Limited Partnership (Ortigas).

On even date, Frias, Jr. and Veneracion filed a Motion for Leave and to Admit Complaint of Indigent Litigants.5Included in
the annexes attached thereto are the following: Certification from the Office of the City Assessor of Antipolo City that Frias,
Jr. has no real property registered for taxation purposes; Pinagpisang Salaysay7 stating that he neither has a job nor real
property and etc.

On May 25, 2007, it appears that said motion was granted by Mandaluyong City RTC Executive Judge Maria C. Erum who
wrote the following notation on the first page of the motion: Granted provided the docket fees for this case shall be a lien
in case plaintiffs get a favorable judgment.

First Asia Realty/SM and Ortigas filed a Motion to Dismiss. On August 13, 2007, Judge Acosta-Villarante, then Presiding
Judge of Branch 211, denied the motion to dismiss filed by First Asia Realty/SM.On December 12, 2007, First Asia
Realty/SM filed its Motion for Reconsideration Ad Cautelam. Due to the retirement of Judge Acosta-Villarante, Civil Case
No. MC07-3276, pending before Branch 211, was assigned to respondent judge. On March 18, 2008, the respondent judge
issued the first assailed order wherein it required plaintiffs to pay the proper docket fees within a period of sixty (60) days
from receipt and failure to comply therewith shall cause the DISMISSAL of the complaint on jurisdictional grounds.

Petitioners’ motion for reconsideration was denied by respondent judge in the second assailed order. Hence, this petition.

Petitioners argue that respondent judge did not conduct the proper hearing as prescribed under Section 21, Rule 3 of
the Rules of Court. They claim that private respondents neither submitted evidence nor were they required by respondent
judge to submit evidence in support of their motions on the issue of indigency of petitioners. They contend that respondent
judge disregarded their constitutional right to free access to courts by issuing the assailed orders.

Respondents, on the other hand, cite Section 19, Rule 141 of the Rules of Court, as amended by A.M. No. 00-2-01-SC and
A.M. No. 04-2-04-SC.

ISSUE: Whether or not respondent judge has committed grave abuse of discretion in issuing the questioned order x x x
ordering petitioners to pay the docket fees of the complaint authorized and admitted to be filed as indigents by the executive
judge of the trial court.24
HELD: The petition has no merit.

At the outset, the instant petition should have been dismissed outright for being filed directly with this Court in blatant
violation of the rule on hierarchy of courts.

Setting aside said procedural defect, this Court will look into the merit of petitioners’ allegation of lack of the required
hearing in resolving the issue of indigency.

In the case of Spouses Algura v. Local Gov’t. Unit of the City of Naga, 506 SCRA 81 (2006), this Court had the opportunity
to explain how the two rules cited by the opposing parties can stand together and are compatible with each other, to wit: In
the light of the foregoing considerations, therefore, the two (2) rules can stand together and are compatible with each other.
When an application to litigate as an indigent litigant is filed, the court shall scrutinize the affidavits and supporting
documents submitted by the applicant to determine if the applicant complies with the income and property standards
prescribed in the present Section 19 of Rule 141 — that is, the applicant’s gross income and that of the applicant’s immediate
family do not exceed an amount double the monthly minimum wage of an employee; and the applicant does not own real
property with a fair market value of more than Three Hundred Thousand Pesos (Php300,000.00). If the trial court finds that
the applicant meets the income and property requirements, the authority to litigate as indigent litigant is automatically
granted and the grant is a matter of right.

However, if the trial court finds that one or both requirements have not been met, then it would set a hearing to enable the
applicant to prove that the applicant has “no money or property sufficient and available for food, shelter and basic necessities
for himself and his family.” In that hearing, the adverse party may adduce countervailing evidence to disprove the evidence
presented by the applicant; after which the trial court will rule on the application depending on the evidence adduced. In
addition, Section 21 of Rule 3 also provides that the adverse party may later still contest the grant of such authority at any
time before judgment is rendered by the trial court, possibly based on newly discovered evidence not obtained at the time
the application was heard. If the court determines after hearing, that the party declared as an indigent is in fact a person with
sufficient income or property, the proper docket and other lawful fees shall be assessed and collected by the clerk of court.
If payment is not made within the time fixed by the court, execution shall issue or the payment of prescribed fees shall be
made, without prejudice to such other sanctions as the court may impose.

In the instant case, based on the list of documents submitted by petitioners in support of their Motion for Leave and to Admit
Complaint of Indigent Litigants, it cannot be disputed that petitioners failed to complete the requirements set forth in Section
19, Rule 141 of the Rules of Court. They did not execute their own affidavit as required by said Section 19. And as this
Court ruled in Spouses Algura,29 if the trial court finds that one or both requirements have not been met, then it would set a
hearing to enable the applicant to prove that the applicant has “no money or property sufficient and available for food,
shelter and basic necessities for himself and his family.”

WHEREFORE, the present petition is DENIED.

Lucena Grand Central Terminal, Inc. vs. JAC Liner, Inc.

FACTS: PETITION for review on certiorari of the decision and resolution of the Court of Appeals. Respondent, JAC Liner,
Inc., a common carrier operating buses which ply various routes to and from Lucena City, assailed, via a petition for
prohibition and injunction1 against the City of Lucena, its Mayor, and the Sangguniang Panlungsod of Lucena before the
Regional Trial Court (RTC) of Lucena City, City Ordinance Nos. 1631 and 1778 as unconstitutional on the ground that, inter
alia, the same constituted an invalid exercise of police power, an undue taking of private property, and a violation of the
constitutional prohibition against monopolies. Under Ordinance No. 1778:

e) Section 5 of Ordinance No. 1557, Series of 1995, is hereby amended to read as follows: The Lucena Grand Central
Terminal is the permanent common terminal as this is the entity which was given the exclusive franchise by the
Sangguniang Panlungsod under Ordinance No. 1631; (Emphasis and italics supplied)

The RTC rendered judgment Declaring City Ordinance No. 1778 as null and void, the same being also an ultra vires act of
the City Government of Lucena arising from an invalid, oppressive and unreasonable exercise of the police power; Ordering
the issuance of a Writ of Prohibition and/or Injunction directing the respondents public officials to cease and desist from
implementing Ordinance No. 1778 insofar as said ordinance prohibits or curtails petitioner from maintaining
and operating its own bus terminal.

Having been denied of its Motion for Reconsideration by Order of August 6, 1999, Petitioner elevated its case via petition
for review under Rule 45 before this Court.11 This Court, however, referred the petition to the Court of Appeals with which
it has concurrent jurisdiction.

By Decision of December 15, 2000,13 the appellate court dismissed the petition and affirmed the challenged orders of the
trial court. Petitioner once again comes to this Court via petition for review,16 this time assailing the Decision and Resolution
of the Court of Appeals.

ISSUE: Whether the trial court has jurisdiction over the case, it not having furnished the Office of the Solicitor General
copy of the orders it issued therein.
HELD: Petitioner argues that since the trial court failed to serve a copy of its assailed orders upon the Office of the Solicitor
General, it never acquired jurisdiction over the case, it citing Section 22, Rule 3 of the Rules which provides: SEC. 22. Notice
to the Solicitor General.—In any action involving the validity of any treaty, law, ordinance, executive order, presidential
decree, rules or regulations, the court in its discretion, may require the appearance of the Solicitor Generalwho may be
heard in person or through representative duly designated by him. (Emphasis and italics supplied)

Furthermore, petitioner invokes Sections 3 and 4 of Rule 63 which respectively provide: SEC. 3. Notice on Solicitor
General.—
In any action which involves the validity of a statute, executive order or regulation, or any other governmental
regulation, the Solicitor General shall be notified by the party assailing the same and shall be entitled to be heard
upon such question.

SEC. 4. Local government ordinances.—In any action involving the validity of a local government ordinance, the
corresponding prosecutor or attorney of the local government unit involved shall be similarly notified and entitled
to be heard. If such ordinance is alleged to be unconstitutional, the Solicitor General shall also be notified and
entitled to be heard. (Emphasis and italics supplied)

Nowhere, however, is it stated in the above-quoted rules that failure to notify the Solicitor General about the action is a
jurisdictional defect. In fact, Rule 3, Section 22 gives the courts in any action involving the “validity” of any ordinance, inter
alia, “discretion” to notify the Solicitor General.

More importantly, however, this Court finds that no procedural defect, fatal or otherwise, attended the disposition of the
case. For respondent actually served a copy of its petition upon the Office of the Solicitor General on October 1, 1998, two
days after it was filed. The Solicitor General has issued a Certification to that effect. 17 There was thus compliance with
above-quoted rules.

RULE 4

UNION BANK OF THE PHILIPPINES vs. MAUNLAD HOMES, INC.

FACTS: Union Bank, as seller, and respondent Maunlad Homes, Inc. (Maunlad Homes), as buyer, entered into a contract
to sell involving the Maunlad Shopping Mall.

As stipulated, in the event of rescission due to failure to pay or to comply with the terms of the contract, Maunlad Homes
will be required to immediately vacate the property and must voluntarily turn possession over to Union Bank

When Maunlad Homes failed to pay the monthly amortization, Union Bank sent the former a Notice of Rescission of
Contract

Union Bank sent Maunlad Homes a letter demanding payment of the rentals due and requiring that the subject property be
vacated and its possession turned over to the bank. When Maunlad Homes continued to refuse, Union Bank instituted an
ejectment suit before the Metropolitan Trial Court (MeTC) of Makati City

MeTC dismissed Union Bank’s ejectment complaint. It found that Union Bank’s cause of action was based on a breach of
contract and that both parties are claiming a better right to possess the property based on their respective claims of ownership
of the property.

The MeTC ruled that the appropriate action to resolve these conflicting claims was an accion reivindicatoria, over which it
had no jurisdiction.

On appeal the RTC of Makati City, affirmed the MeTC in its decision RTC declared that the case involved a determination
of the rights of the parties under the contract.

Additionally, the RTC noted that the property is located in Malolos, Bulacan, but the ejectment suit was filed by Union
Bank in Makati City, based on the contract stipulation that "the venue of all suits and actions arising out or in connection
with the Contract to Sell shall be in Makati City." The RTC ruled that the proper venue for the ejectment action is in Malolos,
Bulacan, pursuant to the second paragraph of Section 1, Rule 4 of the Rules of Court

ISSUE: Whether the proper venue for the ejectment action is in Malolos, Bulacan, pursuant to the second paragraph of
Section 1, Rule 4 of the Rules of Court

RULING: No. While Section 1, Rule 4 of the Rules of Court states that ejectment actions shall be filed in "the municipal
trial court of the municipality or city wherein the real property involved x x x is situated," Section 4 of the same Rule
provides that the rule shall not apply "where the parties have validly agreed in writing before the filing of the action on the
exclusive venue thereof." Precisely, in this case, the parties provided for a different venue. In Villanueva v. Judge Mosqueda,
etc., et al., the Court upheld the validity of a stipulation in a contract providing for a venue for ejectment actions other than
that stated in the Rules of Court. Since the unlawful detainer action is connected with the contract, Union Bank rightfully
filed the complaint with the MeTC of Makati City.

SPOUSES TRAYVILLA VS SEJAS

FACTS: petitioners Spouses Trayvilla instituted before the RTC a Civil Case against respondent Sejas. In their Complaint
for specific performance and damages, petitioners claimed that by virtue of a private handwritten document, Sejas sold said
parcel of land to them in 1982. Thereafter, Sejas later reasserted his ownership over said land and was thus guilty of fraud
and deceit in so doing; and that they caused the annotation of an adverse claim. They prayed that Sejas be ordered to execute
a final deed of sale over the property and transfer the same to them.

In an Amended Complaint, this time for specific performance, reconveyance, and damages, petitioners impleaded
respondent Paglinawan as additional defendant, claiming that Sejas subsequently sold the subject property to her, after
which she caused the cancellation and the issuance of a new title in her name. Petitioners prayed that Sejas be ordered to
execute a final deed of sale in their favor and transfer the property to them; that Paglinawan's title over the subject property
be canceled and the property be reconveyed to them. Respondents moved for dismissal but was denied.

Respondents filed a Motion for Reconsideration, arguing that petitioners' case was not for specific performance but was in
reality a real action or one involving title to and possession of real property, in which case the value of the property should
be alleged in the complaint in order that the proper filing fee may be computed and paid; that since the value of the land
was not alleged in the Amended Complaint, the proper filing fee was not paid, and for this reason the case should be
dismissed.

The RTC denied the motion, stating among others that petitioners' case is not a real action but indeed one for specific
performance and thus one which is incapable of pecuniary estimation.

CA reversed the decision of the RTC

ISSUE: Whether the civil case instituted by petitioner is a real action

RULING: Yes. As correctly ruled by the CA, while petitioners' Amended Complaint was denominated as one mainly for
specific performance, they additionally prayed for reconveyance of the property, as well as the cancellation of Paglinawan's
title over the subject property. In other words, petitioners' aim in filing the Civil Case was to secure their claimed ownership
and title to the subject property, which qualifies their case as a real action. Pursuant to Section 1, Rule 4 of the 1997 Rules
of Civil Procedure, a real action is one that affects title to or possession of real property, or an interest therein.

Since the Civil Case is a real action made so by the Amended Complaint later filed, petitioners should have observed the
requirement under A.M. No. 04-2-04-SC relative to declaring the fair market value of the property as stated in the current
tax declaration or zonal valuation of the BIR, Since no such allegation was made in the Amended Complaint, then the value
of the subject property as stated in the handwritten document sued upon and restated in the Amended Complaint should be
the basis for determining jurisdiction and the amount of docket fees to be paid.

PAMARAN v. BA
GR 205753, July 4, 2016

MAIN POINT: Personal action for damages and not for the recovery of possession of a property can be filed where the
plaintiff pursuant to Section2 of Rule 4.

FACTS: Rosa Pamaran alleged that her children, Rhodora Pamaran, and Sps. Rosemary P. Bernabe and Leonardo W.
Bernabe owned adjacent lots. Rosa built her residential house on these lots with the consent of Rhodora and spouses
Bernabe.

Southmarine International Ltd. Co. obtained loans from the Bank of Commerce. To secure these loans, Rhodora and spouses
Bernabe constituted real estate mortgages on their lots. Rosa claimed that the bank neither included her house in determining
the loan amount nor obtained her consent to the REM. She added that the bank was aware of the existence of her house on
these lots. Rosa asserted that eventually, these lots were foreclosed and their ownership was consolidated in favor of
Bankcom. Later, Bankcom filed petitions for issuance of writs of possession, which were granted.

Rosa averred that because of these writs, she was dispossessed of her house in February 2012. Thus, she prayed that
Bankcom be ordered to pay her damages amounting to P3 million for the value of her house, P300,000.00 for its violation
of her right to due process and equal protection of law, and P100,000.00 for attorney's fees, in a case filed in RTC of
Olongapo where she resided.

The bank raised the defense that the venue was improperly laid. It posited that the Complaint should have been filed before
the RTC Muntinlupa where such property is located. RTC of Olongapo granted the motion to dismiss by the bank.
ISSUE: Where the venue for Rosa’s action was improperly laid

RULING: No. Clearly, this action involves Rosa's interest in the value of the house but only in so far as to determine her
entitlement to damages. She is not interested in the house itself. Indeed, the primary objective of the Complaint is to recover
damages, and not to regain ownership or possession of the subject property. Hence, this case is a personal action properly
filed in the RTC Olongapo, where Rosa resided. This case involves a claim arising from Bankcom's alleged violation of
Rosa's right to due process, and to the enjoyment of her house. Thus, Rosa’s personal action was properly filed. The SC
reinstated the case and was remanded to RTC of Olongapo.

RADIOWEALTH FINANCE COMPANY, INC. v. NOLASCO

GR 227146, November 14, 2016

MAIN POINT: To clarify, jurisdiction and venue are not synonymous concepts. Primarily, jurisdiction is conferred by law
and not subject to stipulation of the parties. It relates to the nature of the case. On the contrary, venue pertains to the place
where the case may be filed. Unlike jurisdiction, venue may he waived and subjected to the agreement of the parties provided
that it does not cause them inconvenience.

FACTS: Radiowealth Finance Company, Inc. (petitioner) is a domestic financing corporation with principal address at 7th
Floor, DMG Center, Domingo M. Guevara Street, Mandaluyong City. Reynaldo Nolasco (respondents) are obligors of the
petitioner who both maintain residence in Mandaluyong City.

Respondents secured a loan from petitioner in the amount of P1,908,360.00, this loan is secured by a chattel mortgage.
Respondents defaulted in paying which caused the entire amount to become due and demandable. Thus, the petitioner filed
a Complaint for Sum of Money and Damages with Application for Writ of Replevin with the RTC of San Mateo, Rizal.
RTC of Rizal dismissed the case for lack of jurisdiction. Citing Section 2, Rule 4 of the 1997 Rules of Civil Procedure, it
ruled that since neither the petitioner nor the respondents reside within the jurisdiction of the trial court, that is, either in San
Mateo or Rodriguez, Rizal, the case must be dismissed.

The petitioner filed an MR arguing that the RTC of San Mateo, Rizal has jurisdiction over the case. Further, the venue is
also proper, considering that there is a provision in the promissory note which states that any action to enforce payment of
any sums due shall exclusively be brought in the proper court within the National Capital Judicial Region or in any place
where the petitioner has a branch or office at its sole option. RTC denied the MR.

ISSUE: Whether the venue is improperly laid as neither the petitioner nor respondent resides in Rizal

RULING: No. The RTC confused the terms jurisdiction and venue, which are completely different concepts.

Section 2, Rule 4 of the 1997 Rules of Civil Procedure, which was relied upon by the RTC to support its ruling of dismissal,
reads as follows: All other actions may be commenced and tried where the plaintiff or any of the principal plaintiffs resides,
or where the defendant or any of the principal defendants resides, or in the case of a non-resident defendant where he may
be found, at the election of the plaintiff.

A plain reading of the provision shows that it is merely permissive as manifested by the use of the term "may." Moreover,
the clear language of the ensuing provision of Section 4 of Rule 4 expressly allows the venue of personal actions to be
subjected to the stipulation of the parties. Thus, under Section 4. When rule not applicable. -This Rule shall not apply.
(a) In those cases where a specific rule or law provides otherwise; or (b) Where the parties have validly agreed in
writing before the filing of the action on the exclusive venue thereof.

There is, therefore, nothing that prohibits the parties to decide on a different venue for any dispute or action that may arise
from their agreement. Thus, the petitioner's filing of the case in San Mateo, Rizal, where it maintains a branch is proper and
should have been respected by the RTC especially when there appears no objection on the part of the respondents. In the
present case, the RTC carelessly interfered with the parties' agreement on the venue of their dispute and interrupted what
could have been an expeditious flow of the proceeding. To reiterate, the choice of venue is a matter addressed to the
sound judgment of the parties based on considerations personal to them, i.e. convenience. It is only the parties who
may raise objection on the same. Absent such protest, it is an error for the RTC to decide that the venue was improperly laid
as it is tantamount to needlessly interfering to a mutually agreed term.

Briones v. CA
GR No. 204444

The general rule is that the venue of real actions is the court which has jurisdiction over the area wherein the real property
involved, or a portion thereof, is situated; while the venue of personal actions is the court which has jurisdiction where the
plaintiff or the defendant resides, at the election of the plaintiff.
As an exception, parties thru a written instrument, may either introduce another venue where actions arising from such
instrument may be filed, or restrict the filing of said actions in a certain exclusive venue. However, the case filed by herein
imposes question on the validity in the execution of a contract, hence, the filing of the complaint before RTC of Manila is
proper.

FACTS:

1. A Complaint was filed by Virgilio C. Briones (Briones) for Nullity of Mortgage Contract, Promissory Note, Loan
Agreement, Foreclosure of Mortgage, Cancellation of Transfer Certificate of Title, and Damages against Cash Asia
before the RTC of Manila City;

2. For its part, Cash Asia filed a MTD, praying for the outright dismissal of Briones’s complaint on the ground of
improper venue. In this regard, Cash Asia pointed out the venue stipulation in the subject contracts stating that "all
legal actions arising out of this notice in connection with the Real Estate Mortgage subject hereof shall only be
brought in or submitted to the jurisdiction of the proper court of Makati City."

RTC: Denied Cash Asia’s motion to dismiss for lack of merit

CA: Annulled the RTC Orders, and accordingly, dismissed Briones’s complaint without prejudice to the filing of the same
before the proper court in Makati City. It held that the RTC gravely abused its discretion in denying Cash Asia’s motion to
dismiss, considering that the subject contracts clearly provide that actions arising therefrom should be exclusively filed
before the courts of Makati City only. As such, the CA concluded that Briones’s complaint should have been dismissed
outright on the ground of improper venue, this, notwithstanding Briones’s claim of forgery in their contract.

ISSUE: Whether or not the complaint should have been dismissed outright for wrong venue.

RULING: NO. The general rule is that the venue of real actions is the court which has jurisdiction over the area wherein
the real property involved, or a portion thereof, is situated; while the venue of personal actions is the court which has
jurisdiction where the plaintiff or the defendant resides, at the election of the plaintiff. As an exception, parties, thru a written
instrument, may either introduce another venue where actions arising from such instrument may be filed, or restrict the
filing of said actions in a certain exclusive venue.

In this case, the venue stipulation found in the subject contracts is indeed restrictive in nature, considering that it effectively
limits the venue of the actions arising therefrom to the courts of Makati City. However, it must be emphasized that Briones's
complaint directly assails the validity of the subject contracts, claiming forgery in their execution. Given this circumstance,
Briones cannot be expected to comply with the aforesaid venue stipulation, as his compliance therewith would mean an
implicit recognition of their validity. Hence, pursuant to the general rules on venue, Briones properly filed his complaint
before a court in the City of Manila where the subject property is located.

RULE 5

Vidal, et. al. v. Escueta

GR No. 156228
Action for the enforcement of the settlement should be instituted in the proper municipal or city court; rules on regular
procedure shall apply, as provided in Section 1, Rule 5 of the rules of civil procedure, as amended.

FACTS:

1. Abelardo Escueta died intestate on December 3, 1994. He was survived by his widow, Remedios Escueta, and their
six children, respondent Ma. Teresa O. Escueta and her brother Herman O. Escueta. Part of his estate was a parcel
of land, subject of the present controversy, was leased to a certain Rainier Llanera;

2. Ma. Teresa Escueta, as a co-owner of the property, filed an ejectment case against Llanera and the sub-lessees
before the Lupon of Barangay Highway Hills;

3. The other sublessees, petitioners Ma. Teresa Vidal, Lulu Marquez, Marcelo Trinidad, Carlos Sobremonte, and
Jingkee Ang remained in the property, and requested Escueta for extensions to vacate the property. Escueta agreed,
but despite the lapse of the extensions granted them, the five sub-lessees refused to vacate the property;

4. Escueta opted not to have the sub-lessees evicted through the Punong Barangay as provided for in the amicable
settlement. Instead, she filed on May 12, 2000, a verified "Motion for Execution" against the recalcitrant sub-lessees
with the MTC for the enforcement of the amicable settlement and the issuance of a writ of execution;

5. Petitioners opposed the motion, contending that the real party-in-interest as plaintiff, would be the new owners of
the property, and not the Escuetas. Petitioners further asserted that the amicable settlement was not elevated to or
approved by the MTC as required by Section 419 of the Local Government Code (LGC), nor approved by a
competent court; hence, there was no judgment to enforce by a new motion for a writ of execution. As such, the
plaintiff's motion was premature and procedurally improper. The trial court denied the "Motion for Execution."
RTC: On appeal, the Regional Trial Court rendered a decision holding that the respondent was still the owner of the property
when the ejectment case was filed in the office of the barangay captain, and, as such, is the real party-in-interest as the
plaintiff in the MTC.

CA: Upheld the ruling of the Regional Trial Court. Hence, the present petition.

ISSUE: Whether or not the RTC erred in granting the Motion for Execution

RULING: YES. By express provision of Section 417 of the LGC, an action for the enforcement of the settlement should
be instituted in the proper municipal or city court. This is regardless of the nature of the complaint before the Lupon, and
the relief prayed for therein. The venue for such actions is governed by Rule 4, Section I of the 1997 Rules of Civil
Procedure, as amended. An action for the enforcement of a settlement is not one of those covered by the Rules on Summary
Procedure in civil cases; hence, the rules on regular procedure shall apply, as provided for in Section 1, Rule 5 of the Rules
of Civil Procedure, as amended.

The amicable settlement executed by the parties before the Lupon on the arbitration award has the force and effect of a final
judgment of a court and by express provision of Section 417 of the LGC, an action for the enforcement of the settlement
should be instituted in the proper municipal or city court. The parties executed their Amicable Settlement on May 5, 1999.
However, the petitioners were obliged to vacate the property only in January, 2000, or seven months after the date of the
settlement; hence, the respondent may enforce the settlement through the Punong Barangay within six months from January
2000 or until June 2000, when the obligation of the petitioners to vacate the property became due. The respondent was
precluded from enforcing the settlement via an action with the MTC before June 2000.

However, the respondent filed on May 12, 2000 a motion for execution with the MTC and not with the Punong Barangay.
Clearly, the respondent adopted the wrong remedy. Although the MTC denied the respondent's motion for a writ of
execution, it was for a reason other than the impropriety of the remedy resorted to by the respondent.

RULE 6

RUDOLF LIETZ HOLDINGS VS ROD

MAINPOINT: 1. Annexes form an integral part of the pleading. 2. Amendments to pleadings are liberally allowed in
furtherance of justice, in order that every case may so far as possible be determined on its real facts, and in order to speed
the trial of cases or prevent the circuitry of action and unnecessary expense

FACTS: Rudolf Lietz Inc amended its articles of incorporation and change its name to petitioner Rudolf Lietz Holdings
Inc. Petitioner sought the amendment of the transfer certificates of title over real properties owned by the said corporation,
all of which were under the old name, Rudolf Lietz, Incorporated.

Petitioner instituted, a petition for amendment of titles with the Regional Trial Court of Parañaque City. The petition
impleaded as respondent the Registry of Deeds of Pasay City, apparently because the titles sought to be amended were
issued by the Registry of Deeds of Pasay City. Petitioner likewise inadvertently alleged in the body of the petition that the
lands covered by the subject titles are located in Pasay City.

Subsequently, petitioner learned that the subject titles are in the custody of the Register of Deeds of Parañaque City.
Petitioner filed an Ex-Parte Motion to Admit Amended Petition. In the attached Amended Petition, petitioner impleaded
instead as respondent the Registry of Deeds of Parañaque City, and alleged that its lands are located in Paraaque City.

RTC - dismissed the petition motu proprio on the ground of improper venue, it appearing therein that the respondent is the
Registry of Deeds of Pasay City and the properties are located in Pasay City. Hence the petition.

Petitioner maintained that the trial court had jurisdiction over the petition, but that venue appeared to be improperly laid
based on the erroneous allegation therein on the location of the properties.

ISSUE: WN the trial court did not acquire jurisdiction over the res because it appeared from the original petition that the
lands are situated in Pasay City; hence, outside the jurisdiction of the Parañaque court.

RULING: No. In the case at bar, the lands are located in Paraaque City, as stated on the faces of the titles. Petitioner, thus,
also correctly filed the petition in the place where the lands are situated. Petitioner, however, named as respondent the
Register of Deeds of Pasay City, under the mistaken impression that it was still the custodian of the titles to lands in
Paraaque. Later, petitioner learned that a Register of Deeds for Paraaque City had taken over the record and custody of titles
therein. Petitioner, thus, promptly moved for leave of court to amend its petition. This, to our mind, was justified. In
preparing its amended petition, petitioner likewise corrected its allegation on the location of the lands involved. Before the
amended petition was filed, the trial court had already dismissed the petition based on improper venue. It relied on the
allegation in the petition that the lands are located in Pasay City. However, the titles of the land, copies of which were
attached to the petition, plainly show that the lands involved are situated in Paraaque City. The trial court should have
considered these annexes, as these form an integral part of the pleading. Amendments to pleadings are liberally allowed in
furtherance of justice, in order that every case may so far as possible be determined on its real facts, and in order to speed
the trial of cases or prevent the circuitry of action and unnecessary expense. The trial court, therefore, should have allowed
the amendment proposed by petitioner for in so doing, it would have allowed the actual merits of the case to be speedily
determined, without regard to technicalities, and in the most expeditious and inexpensive manner. Petition granted. RTC
decision reversed and set aside. Civil case reinstated.

NDC vs. CA
G.R. No. L-28173 September 30, 1971

FACTS: A sales agreement was entered into by the Naga and the Pacific, which the latter agreed to supply the former with
roofing and related materials at the Naga City public market for a cost. Later, Pacific filed a complaint against the Naga
alleging that only P107,030 of the total obligation of the Naga refused to pay the balance thereof in the amount of
P143,282.76.

Naga filed a motion with the trial court requesting for an extension of 15 days within which to file its, answer, stating that
— “The inability to prepare and finalize defendant's answer on time is due to the burden of other equally if not more urgent
professional work.” The said motion was granted. Naga filed another motion for an additional, extension of 10 days within
which to file its responsive pleading saying that “...counsel is presently verifying certain material facts and information
relative to the transaction object of the plaintiff's complaint”. The court a quo however, denied the foregoing motion.

Naga filed a supplemental motion for the admission of its answer and to declare the Naga in default and was granted. Naga
filed a motion to set aside the default order but the trial court, however, denied the motion saying that the failure of the Naga
to file its answer within the extended period was due to its fault and negligence.

ISSUE: Whether the trial court's order of default and its order denying the Naga's motion to set aside were correctly issued

RULING: YES. For while in its first motion for extension, counsel for the Naga said that the responsive pleading could not
be finalized due to the pressure of urgent professional commitments, and in its second motion for extension, the Naga's
counsel alleged that more time was needed to verify the truth of the allegations in the complaint. The reason adduced by the
Naga in its first request for extension, according to the lower court, gave the lie to the second request for extension.

Also, even if it is true, as the Naga asserts, that it had made certain payments to the Pacific which should be deducted from
the amount of the claim it would likewise have been a very simple matter to allege that the complaint does not reflect the
true amount due to the Pacific because of payments made. These payments could then be proved at the trial, or, possibly,
admitted at the pre-trial conference. The essential purpose of a responsive pleading is to secure a joinder of the issues and
not to lay down evidentiary matter.
Villanueva vs. CA
G.R. No. 117108, November 5, 1997

FACTS: Records show that three TCT Nos. were issued in the name of Valiant Realty and Development Corporation and
Filipinas Textile Mills, Inc. and the same were mortgaged in favor of Equitable Banking Corp. Upon failure of the
mortgagors to comply with the terms and conditions of the mortgage, the bank foreclosed the mortgaged properties and sold
the same to the Equitable Banking Corp. as the highest bidder at public auction sale. After the expiration of the redemption
period, mortgagors did not exercise the right of redemption and hence, the mortgagee sold all its rights, interests and
participation of said properties to the herein oppositor, Oo Kian Tiok.

Immediately after acquiring the rights, titles and interests of the bank in said properties, Oo Kian Tiok took possession
except for a brief period of time when his possession was interrupted by the herein petitioner who without any court order
swooped down on the properties and disarmed the security guards assigned therein and forcibly removed the 30 workers
therefrom, which prompted Oo Kian Tiok to file Civil Case against Filipinas Textile Mills, Inc., [and] Daniel Villanueva,
et als. for Recovery of Possession and Damages with Prayers for Writ of Preliminary Mandatory Injunction and/or
Temporary Order.

As a consequence, the herein petitioner, being one of the defendants of the above-mentioned case, filed a formal request to
annotate a corresponding Notice of Lis Pendens on the disputed three TCTs but was denied registration on the ground that
Mr. Villanueva is merely asserting possession of the property not on the title or right over the property. While it appears
that Mr. Villanueva is an officer of the owner-corporation, Filipinas Textile Mills, Inc., the latter is no longer the owner
thereof but plaintiff Oo Tian [sic] Tiok.

ISSUE: May the Register of Deeds refuse to register an application for a notice of lis pendens on the ground that the
applicant does not have any title or right of possession over the subject properties?

RULING: To annotate a notice of lis pendens, the following elements must be present: (a) the property must be of such
character as to be subject to the rule; (b) the court must have jurisdiction both over the person and the res; and (c) the
property or res involved must be sufficiently described in the pleadings
In its jurisdiction, the following may file a notice of lis pendens:
(a) The plaintiff — at the time of filing the complaint.
 (b) The defendant —1) at the time of filing his answer (when affirmative relief is claimed in such answer) 2) or
at any time afterwards (See Sec. 24, Rule 14)

The Rule merely requires an affirmative relief to be claimed in the answer to enable a defendant to apply for the annotation
of the notice. Petitioner is not required to prove that the properties to which he seeks annotation of the notice of lis
pendens belongs to him as required by Respondent Court. The Court stressed that the applicant must, in the complaint or
answer filed in the subject litigation, assert a claim of possession or title over the subject property in order to give due course
to his application.

The Rule merely requires an affirmative relief to be claimed in the answer to enable a defendant to apply for the annotation
of the notice. In any event, a reading of the allegations in the answer will readily show that petitioner were not merely
asserting a right of possession over the disputed properties. Rather, they were insisting on their ownership over the said real
estate, claiming that private respondent) was "not entitled at all to their possession, because he did not have any right, title
or interest whatsoever over them.

Vda. de Chua vs. IAC

G.R. No. 70909, January 5, 1994

FACTS: Defendant Herminigilda Herrera executed a Contract of Lease in favor of Tian On whereby the former leased to
the latter a couple of lots in Cebu City. The contract of lease contains a stipulation giving the lessee an option to buy the
leased property. In accordance with the said contract of lease, the lessee, Tian On, erected a residential house on the leased
premises.

Within 4 years from the execution of the said contract of lease, the lessee, Sy Tian On, executed a Deed of Absolute Sale
of Building in favor of Chua Bok, the predecessor-in-interest of plaintiffs, whereby the former sold to the latter the aforesaid
residential house. After the expiration of the contract of lease in the plaintiffs herein, who are the successors-in-interest of
Chua Bok (who had meanwhile died) continued possession of the premises. Defendant Herrera sold the lots in question to
defendants-spouses, Vicente and Victoria Go. Thereafter, plaintiffs filed the instant case seeking the annulment of the said
sale, alleging that the conveyance was in violation of the plaintiffs’ right of option to buy the leased premises as provided
in the Contract of Lease. RTC dismissed plaintiff’s complaint which was affirmed by the CA. Hence, this petition.

Petitioner, among others, questioned the jurisdiction of the trial court in ordering their ejectment from the leased premises
and the removal of the improvements introduced thereon by them. They claim that the action was for the annulment of the
sale of the property, and not an appropriate case for an ejectment.

ISSUE: Whether the trial court has jurisdiction to order the ejectment of plaintiffs

RULING: Yes. The right of possession of petitioners of the leased premises was squarely put in issue by defendants-spouse
Go in their counterclaim to petitioner's complaint, where they asked that ". . . the plaintiff should vacate their premises as
soon as feasible or as the Honorable Court may direct" The said counterclaim in effect was an accion publiciana for the
recovery of the possession of the leased premises.

A counterclaim is considered a complaint, only this time, it is the original defendant who becomes the plaintiff. It stands on
the same footing and is to be tested by the same rules as if it were an independent action. Hence, the same rules on
jurisdiction in an independent action apply to a counterclaim.

DBP vs. CA
G.R. No. 129471, April 28, 2000

FACTS: The land in dispute was originally owned by Ulpiano Mumar who sold the land to private respondent. Unknown
to private respondent, Jose Alvarez succeeded in obtaining the registration of a parcel of land in his name. The said parcel
of land included the 19.4 hectares occupied by private respondent. Alvarez never occupied nor introduced improvements
on said land.

Later, Alvarez sold the land to the spouses Gaudencio and Rosario Beduya under TCT 10101. The spouses Beduya obtained
a loan from petitioner Development Bank of the Philippines mortgaged the subject land. When they failed to pay their
loans, the mortgage on the property was foreclosed.

It appears that private respondent had also applied for a loan from petitioner. Private respondents loan application was later
approved by petitioner. However after releasing the amount of the loan to private respondent, petitioner found that the land
mortgaged by private respondent was included in the land mortgaged by the spouses Beduya. Petitioner, therefore, cancelled
the loan and demanded immediate payment of the amount. Private respondent paid the loan to petitioner for which the
former was issued a Cancellation of Mortgage, releasing the property in question from encumbrance.

More than a year after the foreclosure sale, a re-appraisal of the property was conducted by petitioner’s representatives. It
was then discovered that private respondent was occupying a portion of said land. Private respondent was informed that
petitioner had become the owner of the land he was occupying, and he was asked to vacate the property. As private
respondent refused to do so, petitioner filed a complaint for recovery of possession with damages against him.
RTC declared petitioner as the owner but the CA reversed and gave judgment for private respondent. Hence this petition.
Petitioner contends that the determination of the validity of TCT No. 10101 cannot be collaterally attacked.

ISSUE: Whether there can be a determination of the validity of the title in the present case

RULING: Yes. There is no obstacle to the determination of the validity of TCT No. 10101. It is true that the indefeasibility
of torrens titles cannot be collaterally attacked. In the instant case, the original complaint is for recovery of possession filed
by petitioner against private respondent, not an original action filed by the latter to question the validity of TCT No. 10101
on which petitioner bases its right. To rule on the issue of validity in a case for recovery of possession is tantamount to a
collateral attack. However, it should not be overlooked that private respondent filed a counterclaim against petitioner,
claiming ownership over the land and seeking damages. Hence, we could rule on the question of the validity of TCT No.
10101 for the counterclaim can be considered a direct attack on the same.

A counterclaim is considered a complaint, only this time, it is the original defendant who becomes the plaintiff. . . . It stands
on the same footing and is to be tested by the same rules as if it were an independent action.”

LEYSON vs. BONTUYAN

G.R. No. 156357, February 18, 2005
FACTS:

1. Calixto Gabud was the owner of a parcel of land located in Mabolo, Cebu City. The said property was divided into
two parcels of land because of a construction of a provincial road. He later on executed a Deed of Absolute Sale in
favor of spouses Protacio Tabal and Vivencia Bontuyan, the spouses then sold the two lots to Lourdes V. Leyson
as evidenced by a Deed of Absolute Sale.

2. Despite the knowledge of Gregorio Bontuyan that said property has been sold to his son-in-law and daughter,
spouses Noval, he filed an application with the Bureau of Lands over Lot No. 17150 alleging that the property was
public land and was neither claimed nor occupied by any person and that he first entered upon and began cultivating
the same in his favor. Thus, he has obtained a Free Patent on the said lot and another parcel of land, Lot No. 13272,
was also registered under his name.

3. Meanwhile, Gregorio again executed a Deed of Absolute Sale over the two lots in favor of Naciansino Bontuyan.
He then executed a Real Estate Mortgage over one of the lots in favor of Development Bank of the Philippines
(DBP) as a security for a loan. Shortly thereafter, Naciansino and spouse has left the Philippines and resided in the
US.

4. When the spouses arrived in the Philippines to redeem their property from DBP, they later on discovered that it was
tenanted by Engr. Leyson, one of the late Lourdes Leyson’s children.

5. The spouses Bontuyan, thereafter, filed a complaint against Engr. Leyson in the Regional Trial Court (RTC) of
Cebu City for quieting of title and damages.

6. In his answer to the complaint, Engr. Leyson averred, by way of affirmative defenses, that the two lots were but
portions of a parcel of land owned by Calixto Gabud, covered by T.D. No. 03276-R, and was subdivided into two
parcels of land because of the construction of a provincial road on the property; Gabud later sold the two lots to
Protacio Tabal, who sold the same to Simeon Noval, married to Vivencia Bontuyan, one of the children of Gregorio
Bontuyan; Simeon Noval later sold the property to Lourdes Leyson on May 22, 1968 who, forthwith, took
possession thereof as owner; and Gregorio Bontuyan was issued a free patent over the property through fraud. Engr.
Leyson concluded that the said patent were null and void and that the plaintiffs acquired no title over the property.

7. Engr. Leyson interposed a counterclaim against the spouses Bontuyan and repleaded as an integral part thereof all
the material allegations in his affirmative defense.

ISSUE: Whether the petitioner’s counterclaim in their answer to the complaint constituted a direct attack of the validity of
OCT No. 0-1619 (or Lot No. 17150).

RULING: While Section 47 of Act No. 496 provides that a certificate of title shall not be subject to collateral attack, the
rule is that an action is an attack on a title if its object is to nullify the same, and thus challenge the proceeding pursuant to
which the title was decreed. The attack is considered direct when the object of an action is to annul or set aside such
proceeding, or enjoin its enforcement. On the other hand, an attack is indirect or collateral when, in an action to obtain a
different relief, an attack on the proceeding is nevertheless made as an incident thereof. Such action to attack a certificate
of title may be an original action or a counterclaim in which a certificate of title is assailed as void. A counterclaim is
considered a new suit in which the defendant is the plaintiff and the plaintiff in the complaint becomes the defendant. It
stands on the same footing and is to be tested by the same rules as if it were an independent action. Furthermore, since all
the essential facts of the case for the determination of the titles validity are now before the Court, to require the party to
institute cancellation proceedings would be pointlessly circuitous and against the best interest of justice.
 TAN vs. KF CORP
G.R. No. 146595, June 20, 2003

FACTS: Petitioners complaint was for declaration of nullity, invalidity or annulment of the promissory notes purportedly
attached to the Real Estate Mortgage dated November 16, 1995 and the usurious and void interest rates appearing therein
and the Deed of Sale Under Pacto De Retro. Respondents counterclaim was for the payment of the principal amount of the
loan, compounded monthly interest and annual penalty interest arising out of the non-payment of the principal loan,
litigation expenses and attorneys fees. There is no dispute as to the principal obligation of P4,000,000, but there is a dispute
as to the rate and amount of interest. Petitioner insists that the amount of interest is only 12% yearly until fully paid, while
respondents insist on 3.5% monthly. Also, respondents allege that petitioner owes them P9,333,750.00 representing the
compounded monthly interest and annual penalty, which is disputed by petitioner. Petitioner further seeks the nullification
of the Deed of Sale Under Pacto de Retro for being falsified, while respondents aver the deed is valid.

ISSUES: whether the counterclaim of respondents is compulsory or permissive in nature.

HELD: a counterclaim is compulsory where: (1) it arises out of, or is necessarily connected with the transaction or
occurrence that is the subject matter of the opposing partys claim; (2) it does not require the presence of third parties of
whom the court cannot acquire jurisdiction; and (3) the trial court has jurisdiction to entertain the claim. To determine
whether a counterclaim is compulsory or not, we have devised the following tests: (1) Are the issues of fact or law raised
by the claim and the counterclaim largely the same? (2) Would res judicata bar a subsequent suit on defendants claims
absent the compulsory counterclaim rule? (3) Will substantially the same evidence support or refute plaintiffs claim as well
as the defendants counterclaim? and (4) Is there any logical relation between the claim and the counterclaim?

A compelling test of compulsoriness is whether there is a logical relationship between the claim and counterclaim, that is,
where conducting separate trials of the respective claims of the parties would entail a substantial duplication of effort and
time by the parties and the court.

Petitioners claim is so related logically to respondents counterclaim, such that conducting separate trials for the claim and
the counterclaim would result in the substantial duplication of the time and effort of the court and the parties. Clearly, this
is the situation contemplated under the compelling test of compulsoriness. The counterclaims of respondents herein are
obviously compulsory, not permissive. As aptly held by the Court of Appeals, the issues of fact and law raised by both the
claim and counterclaim are largely the same, with a logical relation, considering that the two claims arose out of the same
circumstances requiring substantially the same evidence. Any decision the trial court will make in favor of petitioner will
necessarily impinge on the claim of respondents, and vice versa. In this light, considering that the counterclaims of
respondents are compulsory in nature, payment of docket fees is not required.

GSIS v Heirs of Caballero

GR 158090

FACTS: Fernando and his wife, Sylvia Caballero, obtained a loan from petitioner GSIS mortaging their residential lot as
security. Fernando defaulted on the payment of the loan. The mortgage was foreclosed and sold at a public auction where
the petitioner was the only bidder. Fernando failed to redeem the subject property. GSIS consolidated its ownership of the
residential lot and requested Fernando for payment of monthly rental in view of his continued occupancy.

In this bidding, Jocelyn Caballero, Fernando’s daughter submitted a bid but defeated by CMTC. GSIS passed Resolution
199 awarding to CMTC the subject property. Fernando, represented by his daughter and attorney-in-fact, Jocelyn, filed a
Complaint against CMTC, GSIS and its responsible officers seeking to declare Res. 199, null and void for the irregularities
in the conduct of the bidding.

The trial court dismissed the complaint and granted petitioner's counterclaim and directed Fernando to pay the rentals paid
by CMTC in the amount of ₱249,800.00. The foregoing amount was collected by Fernando from the CMTC and represents
payment which was not turned over to petitioner, which was entitled to receive the rent from the date of the consolidation
of its ownership over the subject property. On appeal, the CA affirmed the decision of the RTC with the modification that
the portion of the judgment ordering Fernando to pay rentals in favor of petitioner, be deleted.

Petitioner submits that its counterclaim for the rentals is in the nature of a compulsory counterclaim in the original action
of Fernando against petitioner for annulment of bid award, deed of absolute sale and TCT No. 76183. Respondents, on the
other hand, alleged that petitioner's counterclaim is permissive and its failure to pay the prescribed docket fees results into
the dismissal of its claim.

ISSUE: Whether petitioner’s counterclaim is permissive or compulsory

RULING: In the case of Bungcayao, Sr., v FHIPDC, The Court has devised the following tests to determine whether a
counterclaim is compulsory or not:

(a) Are the issues of fact and law raised by the claim and by the counterclaim largely the same?
(b) Would res judicata bar a subsequent suit on defendant’s claims, absent the compulsory counterclaim rule?
(c) Will substantially the same evidence support or refute plaintiff’s claim as well as the defendant’s counterclaim? and
(d) Is there any logical relation between the claim and the counterclaim? A positive answer to all four questions would
indicate that the counterclaim is compulsory.

A positive answer to all four questions would indicate that the counterclaim is compulsory.

The Court agrees with the CA's view that petitioner's counterclaim for the recovery of the amount representing rentals
collected by Fernando from the CMTC is permissive. The evidence needed and the issue in the main action are entirely
different from the issue in the counterclaim. The rule in permissive counterclaims is that for the trial court to acquire
jurisdiction, the counterclaimant is bound to pay the prescribed docket fees. This, petitioner did not do, because it asserted
that its claim for the collection of rental payments was a compulsory counterclaim. Since petitioner failed to pay the docket
fees, the RTC did not acquire jurisdiction over its permissive counterclaim.

Bungcayao, Sr. vs. FHIPDC

GR 170483

FACTS: Six parcels of land in Calayad were conveyed to the Philippine Tourism Authority pursuant to PD 1704. Fort
Ilocandia Resort Hotel was erected on the area.

Petitioner Manuel Bungcayao, Sr. and other D’Sierto members applied for a foreshore lease with the CENRO and was
granted a provisional permit. Respondent FIHPDC filed a foreshore application over a 14-hectare area abutting the Fort
Ilocandia Property, including the 5-hectare portion applied for by D’Sierto members.

The foreshore lease applications of the D’Sierto members were denide on the ground that the subject area applied for fell
either within the titled property or the foreshore areas applied for by respondent.

The D’Sierto members were invited to a luncheon meeting to discuss common details beneficial to all parties concerned.
Atty. Marcos (Bongbong’s wife) was requested to mediate; she offered ₱300,000 as financial settlement per claimant on
the condition that they would vacate the area identified as respondent’s property. D’Sierto counter-offered ₱400,000.

Petitioner alleged that his son, Manuel Jr., who attended the meeting, was pressured into accepting the payment and signed
the Deed of Assignment, Release, Waiver and Quitclaim in favor of respondent. Petitioner then filed against respondent to
nullify the said contract. Petitioner alleged that his son had no authority to represent him and that the deed was void and not
binding upon him. As a counterclaim, respondent prayed that petitioner be required to return the amount of ₱400,000 from
respondent, to vacate the portion of the respondent’s property he was occupying, and to pay damages.

The trial court ruled that it was established that the property occupied by petitioner was within the titled property of
respondent and granted respondent’s counterclaim for recovery of possession of the lot. The Court of Appeals ruled that the
counterclaims raised by respondent were compulsory in nature, as they arose out of or were connected with the transaction
or occurrence constituting the subject matter of the opposing party’s claim and did not require for its adjudication the
presence of third parties of whom the court could not acquire jurisdiction.

ISSUE: Whether respondent’s counterclaim is compulsory

RULING: No. A compulsory counterclaim is any claim for money or any relief, which a defending party may have against
an opposing party, which at the time of suit arises out of, or is necessarily connected with, the same transaction or occurrence
that is the subject matter of the plaintiff’s complaint.

It is compulsory in the sense that it is within the jurisdiction of the court, does not require for its adjudication the presence
of third parties over whom the court cannot acquire jurisdiction, and will be barred in the future if not set up in the answer
to the complaint in the same case. Any other counterclaim is permissive.

The criteria to determine whether the counterclaim is compulsory or permissive are as follows:

(a) Are issues of fact and law raised by the claim and by the counterclaim largely the same?
(b) Would res judicata bar a subsequent suit on defendant’s claim, absent the compulsory rule?
(c) Will substantially the same evidence support or refute plaintiff’s claim as well as defendant’s counterclaim?
(d) Is there any logical relations between the claim and the counterclaim?

A positive answer to all four questions would indicate that the counterclaim is compulsory.

Respondent filed three counterclaims. The first was for recovery of the ₱400,000 given to Manuel, Jr.; the second was for
recovery of possession of the subject property; and the third was for damages. The first counterclaim was rendered moot
with the issuance of the Order confirming the agreement of the parties to cancel the Deed of Assignment, Release, Waiver
and Quitclaim and to return the ₱400,000 to respondent. Respondent waived and renounced the third counterclaim for
damages.

The only counterclaim that remained was for the recovery of possession of the subject property. While this counterclaim
was an offshoot of the same basic controversy between the parties, it is very clear that it will not be barred if not set up in
the answer to the complaint in the same case. Respondent’s second counterclaim, contrary to the findings of the lower
courts, is only a permissive counterclaim. It is capable of proceeding independently of the main case.

La Tondeña Distillers, Inc. vs. Court of Appeals

G.R. No. 88938 June 8, 1992

MAINPOINT: On the other hand, a stranger to the action, i.e., a person not a party to the action, or as the law puts it," any
other person than the defendant or his agent," whose property is seized pursuant to the writ of delivery, is accorded the
remedy known as a terceria, a third party claim to wit: "SEC. 7. Third-party claim.—If the property taken be claimed by
any other person than the defendant or his agent, and such person makes an affidavit of his title thereto or right to the
possession thereof, stating the grounds of such right or title, and serves the same upon the officer while he has possession
of the property, and a copy thereof upon the plaintiff, the officer is not bound to keep the property or deliver it to the plaintiff,
unless the plaintiff or his agent, on demand of the officer, indemnifies him against such claim by a bond in a sum not greater
than the value of the property, and in case of disagreement as to such value the same shall be decided by the court issuing
the order.

To avail of the remedy, prior determination of whether one is a proper party defendant or a stranger to the action is
necessary.

Amendments under Section 2, Rule 10 amendment of complaint a matter of right before answer is filed.

FACTS: La Tondeña Distillers, Inc. (La Tondena) manufactures and sells a gin popularly known as "Ginebra San Miguel,"
which is contained in 350 c.c. white flint bottles with the marks of ownership "LA TONDEÑA, INC." and "GINEBRA
SAN MIGUEL" stamped or blown-in to the bottles which . . . (it [La Tondeña]) specially ordered from the bottle
manufactures for its exclusive use. The bottles were registered with the Philippine Patent Office and use of the registered
bottles by any one without written permission of the owner is declared unlawful by Section 2 of R.A. 623. It was likewise
alleged that the sale of the gin in the registered white flint, bottles does not include the sale of the bottles themselves. By
virtue of these facts, La Tondena prayed to the Regional Trial Court of Manila to 1) “issue an order directing the, Sheriff
or other proper officer . . . to take into his custody all the 350 c.c. bottles of the plaintiff in the possession of the defendant
. . . and to dispose of the same in accordance with the rules of court”, 2) to be adjudged the lawful owner possessor of the
said bottles, and 3) for private respondent Tee Chin Ho to be made to pay, actual, nominal and temperate and exemplary
damages in specific stated amounts (aggregating P75,400.00), as well as attorney's fees in the amount of P50,000.00.

Judge Santillan of the Manila RTC issued the writ of delivery prayed for upon La Tondeña's posting of a bond in the amount
of P40,000.00. In implementation of the writ, Deputy Sheriff Regio Ruefa seized 20,250 bottles with the blown-in marks,
"La Tondeña Inc." and "Ginebra San Miguel". The sheriff Mr. Ruefa executed a handwritten "Receipt" and among others,
was signed by Tee Chin Ho as witness. Sheriff Ruefa's return attests that prior to seizing the bottles, he served summons,
copy of the complaint and its annexes, copy of the bond, and the writ of seizure personally on one “Te Tien Ho” (it was La
Tondena’s position the Te Tien Ho and Tee Chin Ho were one and the same person). The five-day period within which the
sufficiency of the replevin bond might be objected to or the return of the property seized expired without any person
objecting to the bond or seeking the return of the bottles, instead an individual identifying himself as "Tee Chin Ho" filed
on a pleading denominated "ANSWER” alleging 1) all purchases of La Tondeña's gin necessarily included the bottles
containing the gin; hence ownership of the bottles did not remain in La Tondeña but was transferred to the purchasers; 2) it
was from him, Tee Chin Ho, and not from Te Tien Ho, that the bottles in question had been taken by Sheriff Ruefa, and it
was taken from a different numbered address on the same street (1105 instead of 1005 Estrada Street, Manila); 3) La
Tondeña had "masterminded and caused two instances of seizure against intervenor, first through and by the Manila City,
police, and second through the Court's sheriff.

The sheriff delivered the bottles to La Tondena, however, a TRO was issued to maintain the status quo and prevent La
Tondena from seizing bottles at 1105 Estrada St. La Tondena reiterated its position that Te Tien Ho and Tee Chin Ho were
one and the same person. Judge Santillan ruled in favor of Tee Chin Ho, issuing writs of preliminary mandatory injunction
and preliminary prohibitory injunction, stating “that the seizure authorized by the Court's writ of replevin is only against the
person whose name and address is pleaded in the complaint namely TE TIEN HO at No. 1005 Estrada St., Singalong,
Manila; the two truckloads empty bottles seized by the Manila Police (Exhibit "4") and by the Sheriff of Manila (Exhibit
"5") from intervenor Tee Chin Ho, is improper and unlawful” and “ordering plaintiff La Tondeña Distillers, Inc., its agents,
duly authorized representatives or other persons acting for and in its behalf to return and restore unto intervenor Tee Chin
Ho at his address at 1105 Estrada St…” La Tondena raised the case to the Court of Appeals via a petition for Certiorari,
Prohibition and Mandamus but was dismissed for not being the proper subject of a petition for CPM.

ISSUE:1. Whether or not La Toneda may still amend his pleading as a matter of right?
2.WON Tee Chin Ho should still have moved to intervene in the action as defendant in intervention?

RULING:
1.YES. Also overlooked by respondent Judge was that the amendment sought by La Tondeña was one of those explicitly
mentioned, and could, in the premises, be made as a matter of right, in accordance with Sections 1 and 2, Rule 10 of the
Rules of Court It is plain from the record that at the time that La Tondeña moved to amend its complaint to correct "a
mistake in the name of a party" and "a mistaken or inadequate allegation or description" of that party's place of residence
or business, no effective "responsive pleading" (i.e., the answer) had been served on it by the person impleaded in the action
as defendant; for the admission of Tee Chin Ho's answer-in-intervention (with permissive counterclaim) was yet hanging
fire and no notice of the Court's action thereon had been served on La Tondeña. Clearly, then, the amendment which La
Tondeña wished to make was a matter of right in accordance with Section 2, Rule 10. Being directed at a "defect in the
designation of the parties," it was in truth a correction that could be summarily made at any stage of the action provided no
prejudice is caused thereby to the adverse party," as Section 4 of the same Rule 10 further provides.

2.NO. It is amazing, too, why Tee Chin Ho—who was already actually a defendant because he had been served with
summons and had implicitly acknowledged his status as such by signing or causing the signing of his name to certain papers
in which he was described as defendant—should thereafter still have moved to intervene in the action as defendant in
intervention. The more direct step indicated under the circumstances, since he had already been brought into the action as
defendant, although against his will, was merely to draw the court's attention, by some appropriate motion or pleading, to
the lack of any cause of action against him because he was not the person impleaded as defendant in the complaint and, of
course, seek relief from the writ of seizure and the recovery of such damages as might have been caused to him by the
enforcement thereof. However, Tee Chin Ho chose the more circuitous path: although already technically a defendant, he
still filed a motion to intervene as defendant, and also with the same basic objective: to tell the Court he was not the person
named in the complaint, and to recover the property seized from him as well as damages.

By this maneuver, Tee Chin Ho was able to evade the legal consequences of the expiration of the five-day period prescribed
by Section 5 (in relation to Section 6) of Rule 10, supra; he succeeded in recovering the bottles in question even after the
expiry of said period, and what is more, as defendant in intervention, he was able to put at issue the propriety of the ground
relied upon for a writ of delivery—which he would have been disqualified to do as defendant. It was seriously wrong for
the Court to have sanctioned such a maneuver.

Korea Technologies Co., Ltd. vs. Lerm

G.R. No. 143581 January 7, 2008

MAINPOINT: On July 17, 1998, at the time PGSMC filed its Answer incorporating its counterclaims against KOGIES, it
was not liable to pay filing fees for said counterclaims being compul sory in nature. We stress, however, that effective
August 16, 2004 under Sec. 7, Rule 141, as amended by A.M. No. 04-2-04-SC, docket fees are now required to be paid in
compulsory counterclaim or cross-claims.

As to the failure to submit a certificate of forum shopping, PGSMC’s Answer is not an initiatory pleading which requires a
certification against forum shopping under Sec. 524 of Rule 7, 1997 Revised Rules of Civil Procedure. It is a responsive
pleading, hence, the courts a quo did not commit reversible error in denying KOGIES’ motion to dismiss PGSMC’s
compulsory counterclaims.

FACTS: Petitioner KOGIES and respondent PGSMC executed a Contract whereby KOGIES would set up an LPG Cylinder
Manufacturing Plant for respondent. Respondent unilaterally cancelled the contract on the ground that petitioner had altered
the quantity and lowered the quality of the machineries and equipment it delivered. Petitioner opposed informing the latter
that PGSMC could not unilaterally rescind their contract nor dismantle and transfer the machineries and equipment on mere
imagined violations by petitioner. Petitioner then filed a Complaint for Specific Performance against respondent before the
RTC. Respondent filed its Answer with Compulsory Counterclaim asserting that it had the full right to dismantle and transfer
the machineries and equipment because it had paid for them in full as stipulated in the contract. KOGIES filed a motion to
dismiss respondent’s counterclaims arguing that when PGSMC filed the counterclaims, it should have paid docket fees and
filed a certificate of non-forum shopping, and that its failure to do so was a fatal defect. The RTC dismissed the petitioner’s
motion to dismiss respondent’s counterclaims as these counterclaims fell within the requisites of compulsory counterclaims.

ISSUE: WON payment of docket fees and certificate of non-forum shopping were required in the respondent’s Answer
with counterclaim?

RULING: NO. The counterclaims of PGSMC were incorporated in its Answer with Compulsory Counterclaim in
accordance with Section 8 of Rule 11, 1997 Revised Rules of Civil Procedure, the rule that was effective at the time the
Answer with Counterclaim was filed. Sec. 8 on existing counterclaim or cross-claim states, “A compulsory counterclaim or
a cross-claim that a defending party has at the time he files his answer shall be contained therein.” As to the failure to submit
a certificate of forum shopping, PGSMC’s Answer is not an initiatory pleading which requires a certification against forum
shopping under Sec. 524 of Rule 7, 1997 Revised Rules of Civil Procedure. It is a responsive pleading, hence, the courts a
quo did not commit reversible error in denying KOGIES’ motion to dismiss PGSMC’s compulsory counterclaims. At the
time PGSMC filed its Answer incorporating its counterclaims against KOGIES, it was not liable to pay filing fees for said
counterclaims being compulsory in nature.

BA vs. C.A. G.R. No. 121824

FACTS:
1. Mahtani decided to visit his relatives in Bombay, India. He obtained services of Mr. Gumar to prepare his travel
plans. The latter purchased a ticket from British Airways (BA).

2. Since BA had no direct flights from Manila to Bombay, Mahtani had to take a flight to HongKong via PAL , and
upon arrival in HK he had to take a connecting flight to Bombay on board BA.
 3. Mahtani checked in at the PAL counter in Manila his 2 pieces of luggage containing his clothing and personal
effects, confident that upon reaching HK, the same would be transferred to the BA flight bound for Bombay.

4. When Mahtani arrived in Bombay, he discovered that his luggage was missing and that upon inquiry from the BA
representatives, he was told that the same might be diverted to London. After one week, BA finally advised him to
file a claim by accomplishing the Property Irregularity Report.

5. Back in the Philippines, Mahtani filed his claim for damages against BA and Mr. Gumar. BA contended that
Mahtani did not have cause of action against it. BA also filed a third party complaint against PAL alleging that the
reason for the non-transfer of the luggage was due to the latter’s late arrival in HK, thus leaving hardly any time for
the proper transfer of Mahtani’s luggage to the BA aircraft bound for Bombay.

6. PAL disclaimed liability arguing that there was adequate time to transfer the luggage to BA facilities in HK.

7. Trial court rendered its decision in favor of Mahtani. The third party complaint against PAL was dismissed for lack
of cause of action. CA affirmed in toto.

ISSUE: Whether or not the dismissal of the third party complaint is correct.

RULING: No. The third-party complaint is a procedural device whereby a ‘third party’ who is neither a party nor privy to
the act or deed complained of by the plaintiff, may be brought into the case with leave of court, by the defendant, who acts
as third-party plaintiff to enforce against such third-party defendant a right for contribution, indemnity, subrogation or any
other relief, in respect of the plaintiff’s claim.

The contract of air transportation was exclusive between Mahtani and BA. It is undisputed that PAL, in transporting Mahtani
from Manila to HK, acted as the agent of BA. It is a well-settled rule that an agent is also responsible for any negligence in
the performance of its function and is liable for damages which the principal may suffer by reason of its negligent act. Since
the instant petition was based on breach of contract of carriage, Mahtani can only sue BA and not PAL, since the latter was
not a party to the contract. However, this is not to say that PAL is relieved from any liability due to any of its negligent act.

EMATA VS. IAC

FACTS: Petitioner purchased a car on installment from Violago Motor Sales Corp. with a down payment of P 14,982 and
a promissory note(PN and chattel mortgage as security. Violago endorsed the promissory note and assigned the chattel
mortgage to Filinvest Credit Corp. and later assigned the remaining installment balance to Service wide who alleged non-
payment of it and filed for replevin and damages. Petitioner alleged that the PN did not express true intent and procured
through fraud by inflating the value and charging more.

He filed a Motion to Implead Filinvest because it retained interest over the balance even of it assigned to private respondent.
He was given (15) days to file the third-party complaint against Filinvest but petitioner did not comply. He filed an urgent
motion to cancel the scheduled pre-trial and the trial court reset the same. Another motion for postponement filed was
denied, whichthe court issued an order declaring him in default. Respondent Corp. was then allowed to present evidence ex
parte. Upon subsequent motion, the trial court not only lifted the default order but also allowed him to cross-examine private
respondent's sole witness "as a last opportunity to adduce evidence in support of the material allegations of his answer." The
court decided mostly favoring the private respondent to which he argued that the trial court erred in requiring him to file a
third- party complaint against Filinvest, instead of impleading the latter either as party plaintiff or defendant. He insists that
Filinvest is the real party in interest in the present case and it should be impleaded under Rule 3 of the Rules of Court
Sections 10 11 and Rule 6.

RULING: The third-party complaint against Filinvest, had petitioner filed the same, would be a claim in respect of the
plaintiffs claim since the former arises from the same transaction on which the plaintiffs claim is based, that is, the
promissory note which was eventually assigned to private respondent. He cannot rely on the provisions of Section 10, Rule
3 which envisages a party who should be joined as a plaintiff but who does not assent to such joinder because uch unwilling
party must be a real party in interest. In the case at bar, Filinvest's position and the evidence thereon was that it was not a
real party in interest, as it was no longer entitled to the avails of the suit by reason of the anterior assignment it made in
favor of private respondent.

Hence, at the very least, its capacity was in issue and it would be a case of procedural petitio principii for the trial court to
have categorized it as an unwilling co-plaintiff, with the procedural consequences thereof, although such operative issue
was still unresolved. Furthermore, the option lies with the plaintiff on whether or not to join an additional party in his
complaint. The original plaintiff cannot be compelled, on the mere representations of the defendant, to implead anyone,
especially if it does not appear that such joinder is proper or is necessary for the complete and expeditious adjudication of
the case.

Nor can the general rule in Section 11, Rule 3, on the power to order the addition or dropping of a party at any stage of
action, be of solace to the petitioner. This is a power addressed to the sound discretion of the court to be exercised on such
terms as are just, and by this is meant that it must be just to all the other parties. Obviously, given the facts of this case, the
trial court wisely exercised its discretion in refusing to give in to the unjustified importunings of petitioner.

PHILTRANCO VS FELIX PARAS

MAINPOINT: In an action for breach of contract of carriage commenced by a passenger against his common carrier, the
plaintiff can recover damages from a third-party defendant brought into the suit by the common carrier upon a claim based
on tort or quasi-delict. The liability of the third-party defendant is independent from the liability of the common carrier to
the passenger. The requisites for a third-party action are:

1. that the party to be impleaded must not yet be a party to the action;
2. that the claim against the third-party defendant must belong to the original defendant;
3. the claim of the original defendant against the third-party defendant must be based upon the plaintiffs claim against the
original defendant; and,
4. the defendant is attempting to transfer to the third-party defendant the liability asserted against him by the original plaintiff

FACTS: On his way home to Manila from Bicol, Felix Paras boarded a bus, owned and operated by Inland Trailways, Inc.
and driven by its driver Calvin Coner.

It was bumped at the rear by another bus, owned and operated by Philtranco Service Enterprises, Inc.

As a result of the strong and violent impact, the said accident bought considerable damage to the vehicles involved and
caused physical injuries to the passengers and crew of the two buses, including the death of Coner who was the driver of
the Inland Bus at the time of the incident. Due to the accideng, Paras was found and diagnosed to be affected with the
following injuries: a) contusion/hematoma; b) dislocation of hip upon fracture of the fibula on the right leg; c) fractured
small bone on the right leg; and d) close fracture on the tibial plateau of the left leg. He underwent two (2) operations
affecting the fractured portions of his body. Unable to obtain sufficient financial assistance from Inland for the costs, Paras
filed a complaint for damages based on breach of contract of carriage against Inland. Inland denied responsibility. Upon
leave of court, Inland filed a third-party complaint against Philtranco and Apolinar Miralles (Third Party defendants). In
this third-party complaint, Inland, sought for exoneration of its liabilities to Paras, asserting that the latters cause of action
should be directed against Philtranco considering that the accident was caused by Miralles lack of care, negligence and
reckless imprudence.

ISSUE: WN Inland can implead Philtranco and its driver through Third Party Complaint.

RULING: Yes. Impleading Philtranco and its driver through the third-party complaint filed was correct. The device of the
third-party action, also known as impleader, was in accord with Section 12, Rule 6 ROC. The requisites for a third-party
action are, firstly, that the party to be impleaded must not yet be a party to the action; secondly, that the claim against the
third-party defendant must belong to the original defendant; thirdly, the claim of the original defendant against the third-
party defendant must be based upon the plaintiffs claim against the original defendant; and, fourthly, the defendant is
attempting to transfer to the third-party defendant the liability asserted against him by the original plaintiff. As the foregoing
indicates, the claim that the third-party complaint asserts against the third-party defendant must be predicated on substantive
law. Here, the substantive law on which the right of Inland to seek such other relief through its third-party complaint rested
were Article 2176 and Article 2180 of the Civil Code. Paras cause of action against Inland (breach of contract of carriage)
did not need to be the same as the cause of action of Inland against Philtranco and its driver (tort or quasi-delict) in the
impleader. It is settled that a defendant in a contract action may join as third-party defendants those who may be liable to
him in tort for the plaintiffs claim against him, or even directly to the plaintiff. XXX Nor was it a pre-requisite for attachment
of the liability to Philtranco and its driver that Inland be first declared and found liable to Paras for the breach of its contract
of carriage with him. XXX allowing the recovery of damages by Paras based on quasi-delict, despite his complaint being
upon contractual breach, served the judicial policy of avoiding multiplicity of suits and circuity of actions by disposing of
the entire subject matter in a single litigation. CA decision is affirmed. Philtranco and its driver Miralles are jointly and
severally liable to Felix Paras.