I.

GENERAL PRINCIPLES

MAGABILIN_ConceptOfRemedialLaw

PRISCILLA ALMA JOSE, Petitioner RAMON C. JAVELLANA, ET AL.,

G.R. No. 158239. January 25, 2012

FACTS:
Margarita Marquez Alma Jose (Margarita) sold for consideration of P160,000.00 to respondent
Ramon Javellana by deed of conditional sale two parcels of land. They agreed that Javellana would
pay P80,000.00 upon the execution of the deed and the balance of P80,000.00 upon the registration of
the parcels of land under the Torrens; and that should Margarita become incapacitated, her son and
attorney-in-fact, Juvenal M. Alma Jose (Juvenal), and her daughter, petitioner Priscilla M. Alma Jose,
would receive the payment of the balance and proceed with the application for registration.

After Margarita died and with Juvenal having predeceased Margarita without issue, the vendors
undertaking fell on the shoulders of Priscilla, being Margaritas sole surviving heir. However, Priscilla did
not comply with the undertaking to cause the registration of the properties under the Torrens System,
and, instead, began to improve the properties by dumping filling materials therein with the intention of
converting the parcels of land into a residential or industrial subdivision. Faced with Priscillas refusal to
comply, Javellana commenced an action for specific performance, injunction, and damages against her in
the RTC.

Javellana prayed for the issuance of a temporary restraining order or writ of preliminary
injunction. Priscilla filed a motion to dismiss, stating that the complaint was already barred by
prescription; and that the complaint did not state a cause of action. The RTC initially denied Priscillas
motion to dismiss. However, upon her motion for reconsideration, the RTC reversed itself and granted the
motion to dismiss, opining that Javellana had no cause of action against her due to her not being bound to
comply with the terms of the deed of conditional sale for not being a party thereto.

Javellana moved for reconsideration, contending that the presentation of evidence of full payment
was not necessary at that stage of the proceedings; and that in resolving a motion to dismiss on the
ground of failure to state a cause of action. The RTC denied the motion for reconsideration. Accordingly,
Javellana filed a notice of appeal and the records were elevated to the Court of Appeals (CA). CA denied
the motion for reconsideration. Thereafter, Priscilla then brought this appeal, averring that the CA
thereby erred in not outrightly dismissing Javellanas

ISSUE:

WON Javellanas notice of appeal was timely filed pursuant to the fresh period rule.

HELD:

Appeal was made on time pursuant to Neypes v. CA

 Priscilla insists that Javellana filed his notice of appeal out of time. She points out that he received
a copy of the order, and filed his motion for reconsideration after the lapse of 12 days; that the RTC denied
his motion for reconsideration through the order of June 21, 2000, a copy of which he received on July 13,
2000; that he had only three days from July 13, 2000, or until July 16, 2000, within which to perfect an
appeal; and that having filed his notice of appeal on July 19, 2000, his appeal should have been dismissed
for being tardy by three days beyond the expiration of the reglementary period.

Section 3 of Rule 41 of the Rules of Court provides:

Section 3. Period of ordinary appeal. The appeal shall be taken within fifteen (15)
days from notice of the judgment or final order appealed from. Where a record on appeal
is required, the appellant shall file a notice of appeal and a record on appeal within thirty
(30) days from notice of the judgment or final order.

The period of appeal shall be interrupted by a timely motion for new

trial or reconsideration. No motion for extension of time to file a motion for
new trial or reconsideration shall be allowed.

Under the rule, Javellana had only the balance of three days from July 13, 2000, or until July 16,
2000, within which to perfect an appeal due to the timely filing of his motion for reconsideration
interrupting the running of the period of appeal. As such, his filing of the notice of appeal only on July 19,
2000 did not perfect his appeal on time, as Priscilla insists.

Considering that the Court meanwhile adopted the fresh period rule in Neypes v. Court of
Appeals, by which an aggrieved party desirous of appealing an adverse judgment or final order is allowed
a fresh period of 15 days within which to file the notice of appeal in the RTC reckoned from receipt of the
order denying a motion for a new trial or motion for reconsideration, to wit:

The Supreme Court may promulgate procedural rules in all courts. It has the sole
prerogative to amend, repeal or even establish new rules for a more simplified and
inexpensive process, and the speedy disposition of cases. In the rules governing appeals
to it and to the Court of Appeals, particularly Rules 42, 43 and 45, the Court allows
extensions of time, based on justifiable and compelling reasons, for parties to file their
appeals. These extensions may consist of 15 days or more.

To standardize the appeal periods provided in the Rules and to afford litigants fair
opportunity to appeal their cases, the Court deems it practical to allow a fresh period of 15
days within which to file the notice of appeal in the Regional Trial Court, counted from
receipt of the order dismissing a motion for a new trial or motion for reconsideration.

The fresh period rule may be applied to this case, for the Court has already retroactively extended
the fresh period rule to actions pending and undetermined at the time of their passage and this will not
violate any right of a person who may feel that he is adversely affected, inasmuch as there are no vested
rights in rules of procedure. According to De los Santos v. Vda. de Mangubat:

Procedural law refers to the adjective law which prescribes rules and forms of
procedure in order that courts may be able to administer justice. Procedural laws do not
come within the legal conception of a retroactive law, or the general rule against the
 retroactive operation of statues ― they may be given retroactive effect on actions pending
and undetermined at the time of their passage and this will not violate any right of a
person who may feel that he is adversely affected, insomuch as there are no vested rights
in rules of procedure.

The fresh period rule is a procedural law as it prescribes a fresh period of 15 days
within which an appeal may be made in the event that the motion for reconsideration is
denied by the lower court. Following the rule on retroactivity of procedural laws, the
"fresh period rule" should be applied to pending actions, such as the present case.

Also, to deny herein petitioners the benefit of the fresh period rule will amount to
injustice, if not absurdity, since the subject notice of judgment and final order were issued
two years later or in the year 2000, as compared to the notice of judgment and final order
in Neypes which were issued in 1998. It will be incongruous and illogical that parties
receiving notices of judgment and final orders issued in the year 1998 will enjoy the
benefit of the fresh period rule while those later rulings of the lower courts such as in the
instant case, will not.

Consequently, the Court ruled that Javellanas notice of appeal was timely filed pursuant to
the fresh period rule.
MALLARI_NATUREofREMEDIAL LAW

ALVERO VS DE LA ROSA

G.R NO. L-286. March 29, 1949

FACTS:

The record shows that, on June 25, 1945, respondent Jose R. Victoriano had filed a
complaint, in the Court of First Instance of the City of Manila, against petitioner Fredesvindo S.
Alvero and one Margarita Villarica, alleging two causes of action, to wit, (1) to declare in force the
contract of sale, made on October 1, 1940, between said Jose R. Victoriano and Margarita Villarica,
of two (2) parcels of land in the Manotoc subdivision, Balintawak, in the barrio of Calaanan,
municipality of Caloocan, Province of Rizal, with a combined area of 480 square meters, which
land was subsequently sold by said Villarica, in favor of petitioner Fredesvindo S. Alvero, on
December 31, 1944, for the sum of P100,000 in Japanese military notes; and (2) to declare said
subsequent sale null and void. On July 7, 1945, Margarita Villarica filed an answer to said
complaint, expressly admitting having sold said land to Fresdesvindo S. Alvero, for P100,000, in
December, 1944, due to the imperative necessity of raising funds with which to provide for herself
and family, and that she did not remember the previous sale; at the same time, offering to
repurchase said land from Fredesvindo S. Alvero in the sum of P5,000, but that the latter refused
to accept the offer. On July 13, 1945, Fredesvindo S. Alvero, in answering said complaint, denied
the allegations made therein, and claimed exclusive ownership of the land in question, and at the
same time set up a counterclaim and crossclaim in his answer, demanding from Jose R. Victoriano
a P200-monthly rent on said property, beginning from February, 1945, plus P2,000 as damages.
On July 21, 1945, Jose R. Victoriano filed an answer to said counterclaim, denying Fredesvindo S.
Alvero's alleged ownership over said land, and the other allegations contained in Alvero's answer.

After the trial of the case, Judge de la rosa rendered his decision in favor of Jose R. Victoriano,
adjudging to him the title over the property in question, including all the improvements existing
thereon, and dismissed the counterclaim.

The decision rendered by the respondent judge, Hon. Mariano L. de la Rosa, was dated
November 16, 1945, of which counsel for Fredesvindo S. Alvero was notified on November 28,
1945; that his motion for reconsideration and new trial was filed on December 27,
1945, and denied on January 3, 1946, and that said counsel for Alvero was notified of said
order on January 7, 1946; and that he filed his notice of appeal and record on appeal the
following day, to wit, January 8, 1946, and that the P60-appeal bond was filed only on January 15,
1946. On January 15, 1946, Fredesvindo S. Alvero filed an opposition to said motion to dismiss,
alleging that on the very same day, January 15, 1946, said appeal bond for P60 had been actually
filed, and allege as an excuse, for not filing the said appeal bond, in due time, the illness of his
lawyer's wife, who died on January 10, 1946, and buried the following day. On January 17, 1946,
the respondent judge, Hon. Mariano L. de la Rosa, ordered the dismissal of the appeal, declaring
that, although the notice of appeal and record on appeal had been filed in due time, the P60-
appeal bond was filed too late. On January 23, 1946, Fredesvindo S. Alvero filed a petition for the
reconsideration of the said order dated January 17, 1946, dismissing his appeal; and said petition
for reconsideration was denied on January 29, 1946. Hence, this petition for certiorari.
ISSUE:

Whether or not the petition is defective in form and in substance.

HELD:

Yes. (Failure to perfect the appeal, within the time prescribed by the rules of court, will
cause the judgment to become final, and the certification of the record on appeal thereafter, cannot
restore the jurisdiction which has been lost. (Roman Catholic Bishop of Tuguegarao vs. Director of
Lands, 34 Phil., 623; Estate of Cordoba and Zarate vs. Alabado, 34 Phil., 920; and Bermudez vs.
Director of Lands, 36 Phil., 774.)

Counsel for the petitioner Fredesvindo Alvero alleges as an excuse, for his failure to
perfect and file his appeal, in due time, the illness of his wife, which ended in her death on
January 10, 1946, and by which he was greatly affected.

Unfortunately, counsel for petitioner has created a difficult situation. In his motion for
reconsideration and new trial, dated December 27, 1945, he did not point out specifically the
findings or conclusions in the judgment, are not supported by the evidence or which are contrary
to law, making express reference to the pertinent evidence or legal provisions, as expressly required
by Rule 37, section 2, paragraph (c) of the Rules of Court. Motions of that kind have been
considered as motions pro forma intended merely to delay the proceeding, and, as such, they
cannot and will not interrupt or suspend the period of time for the perfection of the appeal.
(Valdez vs. Jugo, 74 Phil., 49, and Reyes vs. Court of Appeals and Bautista, 74 Phil., 235.)
Hence, the period for perfecting herein petitioner's appeal commenced from
November 28, 1945, when he was notified of the judgment rendered in the case, and
expired on December 28, 1945; and, therefore, his notice of appeal and record on
appeal filed on January 8, 1946, were filed out of time, and much more so his
appeal bond, which was only filed on January 15, 1946.

The attorney for petitioner Fredesvindo S. Alvero could have asked for an extension of
time, within which to file and perfect his appeal, in the court below; but he had failed to do so,
and he must bear the consequences of his act. A strict observance of the rules of court, which
have been considered indispensable to the prevention of needless delays and to the orderly and
speedy dispatch of judicial business, is an imperative necessity.
Panganiban_Substantive Law vis a vis Remedial Law

Bustos v. Lucero

GR No. L-2086 March 8, 1949

Facts:

The petitioner, an accused in a criminal case, prayed that the records be remanded to the justice of peace
court of Masantol for him to cross examine the complainant and her witnesses with their testimony, on
the strength of which the warrant of arrest was issued. Prosecutor, invoking Rule 108 Section 11 which
defines the bounds of the defendant's right in the preliminary investigation, objected and was sustained.
The motion was denied by the Supreme Court on the ground that constitutional right to be confronted by
the witnesses against him does not apply to preliminary investigation. The present case is a motion for
reconsideration. Petitioner contended that the rule deals with substantive matter and impairs substantive
rights, particularly his constitutional right.

Issue: Whether or not the rule is a substantive law

Held: No,the Court ruled that Rule 108, Section 11 is a remedial law and not substantive law. Substantive
law creates substantive rights which includes those rights enjoyed under the legal system. It creates,
defines, and regulates rights, or which regulates the rights and duties that give rise to a cause of action. It
is that part of law which courts are established to administer. On the other hand, remedial law prescribes
method of enforcing rights or obtain redress for their invasion. In connection to the criminal case of
petitioner, substantive law declares crimes and prescribes punishment while remedial law provides the
steps by which perpetrator is punished. The Court held that preliminary investigation is essentially
remedial being the first step taken in criminal prosecution.
QUESTIN_ProceduralLawPendingAtPromulgation

PANAY RAILWAYS, INC. v. HEVA MANAGEMENT AND DEVELOPMENT CORP., ET AL.

G.R. No. 154061 January 25, 2012

FACTS:

In 1982, Panay Railways Inc. (PRI) executed a Real Estate Mortgage Contract covering several
parcels of lands, including Lot No. 6153, in favor of Traders Royal Bank (TRB) to secure ₱20 million worth
of loan and credit accommodations. PRI excluded certain portions of Lot No. 6153: that already sold to
Shell Co., Inc. referred to as 6153-B, a road referred to as 6153-C, and a squatter area known as 6153-D.
PRI failed to pay its obligations to TRB, prompting the bank to extra-judicially foreclose the mortgaged
properties. Thereafter, TRB caused the consolidation of the title in its name after PRI failed to exercise the
right to redeem the properties. The corresponding TCTs were subsequently issued in the name of the
bank.

It was only in 1994 that PRI realized that the extrajudicial foreclosure included some excluded
properties in the mortgage contract. Thus, PRI filed a complaint for partial annulment of contract to sell
and deed of absolute sale. Heva Management and Development Corporation (HMDC) filed a motion to
dismiss, which the RTC granted. Aggrieved, PRI filed a notice of appeal without paying the necessary
docket fees. HMDC again filed a motion to dismiss on the ground of nonpayment of docket fees, which
was again granted. In PRI’s petition for certiorari and mandamus, the CA initially reversed the RTC.
However, on motion for reconsideration, the CA sustained the dismissal of the case by the RTC.

It is worth noting that the SC issued A.M. No. 00-2-10-SC which took effect on 1 May 2000,
amending Rule 4, Sec. 7 and Sec. 13 of Rule 41 of the 1997 Revised Rules of Court. The circular expressly
provided that trial courts may, motu proprio or upon motion, dismiss an appeal for being filed out of time
or for nonpayment of docket and other lawful fees within the reglementary period. Subsequently, Circular
No. 48-2000 was issued on 29 August 2000 and was addressed to all lower courts.

Hence, this petition.

PRI’s main contention is that the SC Circular must not be applied retroactively.

ISSUE: WON the SC Circular should be applied retroactively.

RULING:

Yes.

Statutes and rules regulating the procedure of courts are considered applicable to actions pending
and unresolved at the time of their passage. Procedural laws and rules are retroactive in that sense and to
that extent. The effect of procedural statutes and rules on the rights of a litigant may not preclude their
retroactive application to pending actions. This retroactive application does not violate any right of a
person adversely affected. Neither is it constitutionally objectionable. The reason is that, as a general rule,
no vested right may attach to or arise from procedural laws and rules.

It has been held that a person has no vested right in any particular remedy, and a litigant cannot
insist on the application to the trial of his case, whether civil or criminal, of any other than the existing
rules of procedure. More so when, as in this case, PRI admits that it was not able to pay the docket fees on
time. Clearly, there were no substantive rights to speak of when the RTC dismissed the notice of appeal.

Moreover, the right to appeal is not a natural right and is not part of due process. It is merely a
statutory privilege, which may be exercised only in accordance with the law.

The Court has repeatedly stated that the term substantial justice is not a magic wand that would
automatically compel the Court to suspend procedural rules. Procedural rules are not to be belittled or
dismissed simply because their non-observance may result in prejudice to a party’s substantive rights.
Like all other rules, they are required to be followed, except only for the most persuasive of reasons when
they may be relaxed to relieve litigants of an injustice not commensurate with the degree of their
thoughtlessness in not complying with the procedure prescribed.
Reonico_LiberalConstruction

Martos, et. al. vs. New San Jose Builders, Inc.

G.R. No. 192650 October 24, 2012

FACTS
New San Jose Builders, Inc. (NSJB) is engaged in the construction of low-cost houses. NSJB hired
petitioners including Martos. In 2000, NSJB opted to suspend or slow down most of the construction
works of a project because of the lack of funds of the National Housing Authority (NHA). Petitioners were
informed that most of them would be laid off while others will be reassigned to other projects. They did
not sign the appointment papers and refused to work.
Petitioners filed a case for illegal dismissal. The LA dismissed the claims of most petitioners
except that of Martos who was found to be indeed illegally dismissed. Both NSJB and petitioners appealed
to the NLRC. The NLRC decided in favor of the petitioners, while it dismissed the appeal of NSJB. The
case was elevated to the CA who ruled that the NLRC committed grave abuse of discretion in reviving the
complaints of other petitioners because the latter failed to verify their position papers. Petitioners posited
that the lack of verification of a position paper is a mere formal defect and would not affect the
jurisdiction. Hence, this present case.

ISSUE
Whether or not CA was correct in dismissing the complaints of other petitioners who failed to
verify their position papers.

RULING
NO. The verification requirement is significant, as it is intended to secure an assurance that the
allegations in the pleading are true and correct and not the product of the imagination or a matter of
speculation, and that the pleading is filed in good faith. It is deemed substantially complied with when, as
in this case, one who has ample knowledge to swear to the truth of the allegations in the complaint or
petition signs the verification, and when matters alleged in the petition have been made in good faith or
are true and correct. The absence of a proper verification is cause to treat the pleading as unsigned and
dismissible. The lone sign of Martos could have been sufficient if he was authorized by his co-petitioners
to sign for them, but no such authority from the latter was shown.
The liberal construction of the rules may be invoked in situations where 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 it at least connotes a reasonable attempt at compliance with the rules. Besides,
fundamental is the precept that rules of procedure are meant not to thwart but to facilitate the attainment
of justice; hence, their rigid application may, for deserving reasons, be subordinated by the need for an
apt dispensation of substantial justice in the normal course. They ought to be relaxed when there is
subsequent or even substantial compliance, consistent with the policy of liberality espoused by Rule 1,
Section 6. Not being inflexible, the rule on verification allows for such liberality.
Considering that the dismissal of the other complaints by the LA was without prejudice, the other
complainants should have taken the necessary steps to rectify their procedural mistake after the decision
of the LA was rendered. They should have corrected this procedural flaw by immediately filing another
complaint with the correct verification this time. Surprisingly, they did not even attempt to correct this
technical blunder. Worse, they committed the same procedural error when they filed their appeal with the
NLRC. Under the circumstances, the Court agrees with the CA that the dismissal of the other complaints
were brought about by the own negligence and passive attitude of the complainants themselves.
SANTOS_LiberalConstruction

Maria Consolacion Rivera-Pascual vs. Sps. Marilyn Lim

GR No. 191837 September 19,2012

Facts:

Subject of the present controversy is a parcel of land located in Valenzuela City registered under the name
of the Spouses Lim (or private respondents). On September 2004, the petitioner filed before the Office of
the Regional Agrarian Reform (RARAD) for Region IV-A a petition to be recognized as a tenant of a
property located in Valenzuela City against one Deato. At that time, the property was under Deato’s name.
During the pendency of the petition, Deato sold the property to Spouses Lim. The sale was registered on
December 2004 leading to the issuance of a TCT in favor of the private respondents. Thus, the petitioner
filed a motion on March 2005 to implead the Spouses Lim.

On December 2005, the petition was granted by the Regional Adjudicator (RA). The dispositive portion of
the decision includes, inter alia, that the petitioner is the tenant of the subject land by succession from her
deceased father and that she should be subrogated to the rights of the private respondents. The judgment
of the RA became final. Thus, Consolacion filed a motion for execution to which a writ of execution was
issued by the RA on January 2008. Seven days after, the petitioner filed a petition against the private
respondents and the Registrar of Deeds praying for the issuance of an order directing Spouses Lim to
accept the amount of P10million which she undertook to tender, declare the property redeemed and
cancel the TCT.

The petition was given due course by the RA, the dispositive portion of the decision stating that the
property is lawfully redeemed, ordering the private respondents to accept the amount consigned with the
DARAB, execute a deed of redemption in favor of the petitioner and directing the RD to cancel the TCT
registered in the name of the private respondents and issue a new one in favor of the petitioner.

The decision of RARAD was reversed by the DARAB. Consolacion moved for reconsideration which the
DARAB denied. Thereafter, Consolacion filed a petition for review under Rule 43 of the Rules of Court.
The CA did not give due course to the petition due to the following technical grounds: a) failure of counsel
to indicate in the petition his MCLE Certificate of Compliance or Exemption Number and b) the jurat of
Consolacion’s verification and certification against non-forum-shopping failed to indicate any competent
evidence of Consolacion’s identity apart from her community tax certificate.

She moved for reconsideration but was denied. Hence, this petition.

Issue:

Whether or not the petition should be denied due to the unexplained failure to comply with basic
procedural requirements of the Rules of Court.

Held:

Yes, The Court finds no merit in the petition. The Court sees no reversible error committed by the CA in
dismissing Consolacion’s petition.

Consolacion and her counsel claimed inadvertence and negligence but they did not explain the
circumstances thereof. Absent valid and compelling reasons, the requested leniency and liberality in the
observance of procedural rules appears to be an afterthought, hence, cannot be granted. The CA saw no
compelling need meriting the relaxation of the rules. Neither did the Court see any.

The Court is aware of the exceptional cases where technicalities were liberally construed. However, in
these cases, outright dismissal is rendered unjust by the presence of a satisfactory and persuasive
explanation. The parties therein who prayed for liberal interpretation were able to hurdle that heavy
burden of proving that they deserve an exceptional treatment. It was never the Court’s intent “to forge a
bastion for erring litigants to violate the rules with impunity.”

This Court will not condone a cavalier attitude towards procedural rules. It is the duty of every member of
the bar to comply with these rules. They are not at liberty to seek exceptions should they fail to observe
these rules and rationalize their omission by harking on liberal construction.

While it is the negligence of Consolacion's counsel that led to this unfortunate result, she is bound by
such.
TERRE_RuleMakingPowerSC

CIR v. Mirant Pagbilao

GR No. 159593 October 12, 2006

FACTS: MPC, a business of power generation and subsequent sale thereof, seasonably filed its Quarterly
VAT Returns reflecting accumulated input taxes in the amount of P39,330,500.85, allegedly paid to the
suppliers of capital goods and services for the construction and development of the power generating
plant and other related facilities in Pagbilao, Quezon.

MPC filed on June 30, 1998, an application for tax credit or refund of the aforementioned unutilized VAT
paid on capital goods.

Without waiting for an answer from the BIR Commissioner, MPC filed a petition for review before the
CTA to toll the running of the two-year prescriptive period for claiming a refund under the law.

The BIR Commissioner answered that MPC’s claim for refund is still pending investigation and
consideration before its office accordingly, the filing of the present petition is premature; well-settled is
the doctrine that provisions in tax refund and credit are construed strictly against the taxpayer as they are
in the nature of a tax exemption; in an action for refund or tax credit, the taxpayer has the burden to show
that the taxes paid were erroneously or illegally paid, among others.

The CTA ruled in favor of MPC but reduced the amount to which it was entitled, and likewise dismissed
BIR’s Motion for Reconsideration. Thus, BIR filed a petition for review before the CA citing new grounds
not raised before the CTA, namely:

1. Respondent being an electric utility, it is subject to franchise tax under then section 117 (now
section 119) of the tax code and not to value added tax (vat).

2. Since respondent is exempt from vat, it is not entitled to the refund of input vat pursuant to
section 4.103-1 of revenue regulations no. 7-95.

The CA dismissed the case for lack of merit.

Issue: W/N BIR can change its theory of the case on appeal

Held: NO. There is a palpable shift in the BIR Commissioners defense against the claim for refund of
MPC and an evident change of theory. Before the CTA, the BIR Commissioner admitted that the MPC is a
VAT-registered taxpayer, but charged it with the burden of proving its entitlement to refund. However,
before the Court of Appeals, the BIR Commissioner, in effect denied that the MPC is subject to VAT,
making an affirmative allegation that it is a public utility liable, instead, for franchise tax. Irrefragably, the
BIR Commissioner raised for the first time on appeal questions of both fact and law not taken up before
the tax court, an actuality which the BIR Commissioner himself does not deny, but he argues that he
should be allowed to do so as an exception to the technical rules of procedure and in the interest of
substantial justice.
It is already well-settled in this jurisdiction that a party may not change his theory of the case on
appeal.[13] Such a rule has been expressly adopted in Rule 44, Section 15 of the 1997 Rules of Civil
Procedure.

The BIR Commissioner pleads with this Court not to apply the foregoing rule to the instant case, for a rule
on technicality should not defeat substantive justice. The BIR Commissioner apparently forgets that there
are specific reasons why technical or procedural rules are imposed upon the courts, and that compliance
with these rules, should still be the general course of action.

The courts have the power to relax or suspend technical or procedural rules or to except a case from their
operation when compelling reasons so warrant or when the purpose of justice requires it. What
constitutes good and sufficient cause that would merit suspension of the rules is discretionary upon the
courts.[17]

In his Petition and Memorandum before this Court, the BIR Commissioner made no attempt to provide
reasonable explanation for his failure to raise before the CTA the issue of MPC being a public utility
subject to franchise tax rather than VAT.

There is no sufficient cause to warrant the relaxation of technical or procedural rules in the instant case.
The general rules of procedure still apply and the BIR Commissioner cannot be allowed to raise an issue
for the first time on appeal.

It should be emphasized that the BIR Commissioner is invoking a suspension of the general rules of
procedure or an exception thereto, thus, it is incumbent upon him to present sufficient cause or justifiable
circumstance that would qualify his case for such a suspension or exception. That this Court had
previously allowed in another case such suspension of or exception to technical or procedural rules does
not necessarily mean that the same shall also be allowed in the present case. The BIR Commissioner has
the burden of persuading this Court that the same causes or circumstances that justified the suspension of
or exception to the technical or procedural rules in the other case are also present in the case at bar.

Substantial justice, in such a case, requires not the allowance of issues raised for the first time on appeal,
but that the issue of whether MPC is a public utility, and the correlated issue of whether MPC is subject to
VAT or franchise tax, be raised and threshed out in the first opportunity before the CTA so that either
party would have fully presented its evidence and legal arguments in support of its position and to
contravene or rebut those of the opposing party.
LUCERO_RuleMakingPowerSC

I.SHORT TITLE: SM Land Inc vs. City of Manila(2012)

II. FULL TITLE: SM LAND, INC. (Formerly Shoemart, Inc.) and WATSONS PERSONAL CARE
STORES, PHILS., INC.,Petitioners,
vs. CITY OF MANILA, LIBERTY TOLEDO, in her official capacity as the City
Treasurer of Manila and JOSEPH SANTIAGO, in his official capacity as the Chief
of License Division of the City of Manila, Respondents.

III. TOPIC: Civil Procedure – Rule-making power of Supreme Court

IV. STATEMENT OF FACTS:

Respondent City of Manila assessed herein petitioners, together with their other sister companies,
increased rates of business taxes for the year 2003 and the first to third quarters of 2004. Petitioners and
their sister companies paid the additional taxes under protest. Subsequently, petitioners and their sister
companies claimed with herein respondent City Treasurer of Manila a credit or refund of the increased
business taxes which they paid for the period abovementioned. However, the City Treasurer denied their
claim.

Aggrieved, petitioners and their sister companies filed with the Regional Trial Court (RTC) of Pasay City a
Complaint for Refund and/or Issuance of Tax Credit of Taxes Illegally Collected. RTC rendered summary
judgment in favor of petitioners SM Land, Inc. declaring the Tax Ordinance imposed by respondents
already null and void in the case of Coca-Cola Bottlers vs City of Manila

Respondents moved for reconsideration, but the RTC denied it in its Order dated December 14, 2007.

After the CTA granted their request for extension of time, herein respondents filed a petition for review
with the tax court which partially granted the instant petition for review by the respondents. The CTA
Second Division sustained the ruling of the RTC that Ordinance Nos. 7988 and 8011 are null and void.
Applying the doctrine of stare decisis, the CTA Second Division held that the ruling in the Coca-Cola case
cited by the RTC is applicable in the present case as both cases involve substantially the same facts and
issues. The CTA Second Division, nonetheless, held that herein petitioners' claims for tax refund should
be denied because of their failure to comply with the provisions of the Rules of Court requiring
verification and submission of a certificate of non-forum shopping

Aggrieved, petitioners filed a petition for review with the CTA En Banc, contending that: (1) the CTA
Second Division erred in holding that the 30-day period provided by law within which to appeal decisions
of the RTC to the CTA may be extended; and (2) the CTA Second Division committed error in denying
herein petitioners' claim for tax refund on the ground that they violated the rules on verification and
certification of non-forum shopping. the CTA En Banc rendered its assailed Decision affirming in toto the
judgment of the CTA Second Division.

Petitioners' Motion for Reconsideration was subsequently denied by the CTA En Banc.

V. STATEMENT OF THE CASE:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to
reverse and set aside the Decision and Resolution of the Court of Tax Appeals (CTA) En Banc, dated
December 17, 2010 and May 27, 2011, respectively, in CTA EB No. 548. The assailed Decision affirmed the
July 3, 2009 Decision and September 30, 2009 Resolution of the CTA Second Division in CTA AC No. 51,
while the questioned Resolution denied herein petitioners' Motion for Reconsideration.
VI. ISSUE:

1. Whether or Not the 30 day Period to appeal decisions of the regional trial court to the CTA is
extendible
2. Whether or Not there is compelling reasons to justify the relaxation of the rules requiring
verification and certification of non-forum shopping.

VII. RULING:

1. YES. Section 11 of Republic Act No. 9282 provides:

SEC. 11. Who May Appeal; Mode of Appeal; Effect of Appeal. – Any party adversely affected by a decision,
ruling or inaction of the Commissioner of Internal Revenue, the Commissioner of Customs, the Secretary
of Finance, the Secretary of Trade and Industry or the Secretary of Agriculture or the Central Board of
Assessment Appeals or the Regional Trial Courts may file an Appeal with the CTA within thirty (30) days
after the receipt of such decision or ruling or after the expiration of the period fixed by law for action as
referred to in Section 7(a)(2) herein.

Appeal shall be made by filing a petition for review under a procedure analogous to that provided for
under Rule 42 of the 1997 Rules of Civil Procedure with the CTA within thirty (30) days from the receipt
of the decision or ruling or in the case of inaction as herein provided, from the expiration of the period
fixed by law to act thereon.

It is crystal clear from the afore-quoted provisions that to appeal an adverse decision or ruling of the RTC
to the CTA, the taxpayer must file a Petition for Review with the CTA within 30 days from receipt of said
adverse decision or ruling of the RTC.

It is also true that the same provisions are silent as to whether such 30-day period can be extended or not.
However, Section 11 of Republic Act No. 9282 does state that the Petition for Review shall be filed with
the CTA following the procedure analogous to Rule 42 of the Revised

Rules of Civil Procedure. Section 1, Rule 42 of the Revised Rules of Civil Procedure provides that the
Petition for Review of an adverse judgment or final order of the RTC must be filed with the Court of
Appeals within: (1) the original 15-day period from receipt of the judgment or final order to be appealed;
(2) an extended period of 15 days from the lapse of the original period; and (3) only for the most
compelling reasons, another extended period not to exceed 15 days from the lapse of the first extended
period.

Following by analogy, Section 1, Rule 42 of the Revised Rules of Civil Procedure, the 30-day original
period for filing a Petition for Review with the CTA under Section 11 of Republic Act No. 9282, as
implemented by Section 3 (a), Rule 8 of the Revised Rules of the CTA, may be extended for a period of 15
days. No further extension shall be allowed thereafter, except only for the most compelling reasons, in
which case the extended period shall not exceed 15 days.

2. YES. The Court agrees with petitioners' contention in its second argument that there are compelling
reasons in the present case which justify the relaxation of the rules on verification and certification of
non-forum shopping.

It must be kept in mind that while the requirement of the certification of non-forum shopping is
mandatory, nonetheless, the requirements must not be interpreted too literally and, thus, defeat the
objective of preventing the undesirable practice of forum shopping. Time and again, this Court has held
that rules of procedure are established to secure substantial justice. Being instruments for the speedy and
efficient administration of justice, they must be used to achieve such end, not to derail it. In particular,
when a strict and literal application of the rules on non-forum shopping and verification will result in a
patent denial of substantial justice, these may be liberally construed. In fact, this Court has held that even
if there was complete non-compliance with the rule on certification against forum shopping, the Court
may still proceed to decide the case on the merits, pursuant to its inherent power to suspend its own rules

VIII. DISPOSITIVE PORTION:

WHEREFORE, the instant petition is GRANTED. The Decision and Resolution of the Court of Tax
Appeals En Banc, dated December 17, 2010 and May 27, 2011, respectively, in CTA EB No. 548, as well as
the July 3, 2009 Decision and September 30, 2009 Resolution of the Court of Tax Appeals Second
Division in CTA AC No. 51, are REVERSED AND SET ASIDE and the Orders of the Regional Trial Court of
Pasay City, Branch 115, dated July 10, 2007 and December 14, 2007, are REINSTATED.

SO ORDERED.
ACOSTA_RuleMakingPower

EDGARDO PINGA vs. THE HEIRS OF GERMAN, SANTIAGO

represented by FERNANDO SANTIAGO

G.R. No. 170354 June 30, 2006

FACTS:

Petitioner Eduardo Pinga was named as one of two defendants in a complaint for injunction filed with
Branch 29 of the RTC of San Miguel, Zamboanga del Sur, by respondent Heirs of German Santiago,
represented by Fernando Santiago. In their Amended Answer with Counterclaim, petitioner and his co-
defendant disputed respondents’ ownership of the properties in question, asserting that petitioner’s
father, Edmundo Pinga, from whom defendants derived their interest in the properties, had been in
possession thereof since the 1930s.

Several years after, by failing to prosecute the case for an unreasonable length of time, in fact not having
presented their (respondents) evidence yet, the complaint was dismissed. At the same time, the RTC
allowed defendants "to present their evidence ex-parte."

Respondents filed a Motion for Reconsideration of the order issued in open court on 27 July 2005, opting
however not to seek that their complaint be reinstated, but praying instead that the entire action be
dismissed and petitioner be disallowed from presenting evidence ex-parte.

On 9 August 2005, the RTC promulgated an order granting respondents’ Motion for
Reconsideration and dismissing the counterclaim, citing as the only ground therefor that "there is
no opposition to the Motion for Reconsideration of the [respondents]." Petitioner filed a Motion for
Reconsideration, but the same was denied by the RTC in an Order dated 10 October 2005. Notably,
respondents filed an Opposition to Defendants’ Urgent Motion for Reconsideration, wherein they argued
that the prevailing jurisprudential rule is that "compulsory counterclaims cannot be adjudicated
independently of plaintiff’s cause of action," and "a conversu, the dismissal of the complaint carries with it
the dismissal of the compulsory counterclaims."

The matter was elevated to the Court directly by way of a Petition for Review under Rule 45 on a pure
question of law.

ISSUE:

Whether or not the dismissal of the complaint necessarily carries the dismissal of the compulsory
counterclaim.

HELD: NO. The constitutional faculty of the Court to promulgate rules of practice and procedure
necessarily carries the power to overturn judicial precedents on points of remedial law through the
amendment of the Rules of Court. One of the notable changes introduced in the 1997 Rules of Civil
Procedure is the explicit proviso that if a complaint is dismissed due to fault of the plaintiff, such
dismissal is "without prejudice to the right of the defendant to prosecute his counterclaim in the same or
in a separate action." The innovation was instituted in spite of previous jurisprudence holding that the
fact of the dismissal of the complaint was sufficient to justify the dismissal as well of the compulsory
counterclaim.

In granting the petition, the Court recognized that the former jurisprudential rule can no longer stand in
light of Section 3, Rule 17 of the 1997 Rules of Civil Procedure.

Under Section 3, Rule 17 of the 1997 Rules of Civil Procedure, the dismissal of the complaint due to the
fault of plaintiff does not necessarily carry with it the dismissal of the counterclaim, compulsory or
otherwise. In fact, the dismissal of the complaint is without prejudice to the right of defendants to
prosecute the counterclaim.

Petitioner’s counterclaim as defendant was REINSTATED. The Regional Trial Court was ORDERED to
hear and decide the counterclaim with deliberate dispatch.
BARRIETA_RuleMakingPowerSC

IN THE MATTER OF THE PETITION FOR THE ISSUANCE OF A WRIT OF AMPARO IN

FAVOR OF LILIBETH O. LADAGA V. MAJ. GEN. REYNALDO MAPAGU
G.R. No. 189689; G.R. No. 189690; G.R. No. 189691

DOCTRINE: ON RULE MAKING POWER of SC

FACTS

Petitioners (Atty. Lilibeth Ladaga in G.R. No. 189689; Atty. Angela Librado-Trinidad in G.R. No. 189690;
and Atty. Carlos Isagani T. Zarate in G.R. No. 189691) share the common circumstance of having their
names included in what is alleged to be a JCICC “AGILA” 3rd Quarter 2007 Order of Battle Validation
Result of the Philippine Army's 10th Infantry Division (10th ID), which is a list containing the names of
organizations and personalities in Southern Mindanao, particularly Davao City, supposedly connected to
the Communist Party of the Philippines (CPP) and its military arm, the New People's Army (NPA). They
perceive that by the inclusion of their names in the said Order of Battle (OB List), they become easy
targets of unexplained disappearances or extralegal killings – a real threat to their life, liberty and
security.

Petitioners separately filed before the RTC a Petition for the Issuance of a Writ of Amparo with
Application for a Production Order. RTC issued on August 14, 2009 the three separate but similarly-
worded Orders finding no substantial evidence to show that the perceived threat to petitioners' life, liberty
and security was attributable to the unlawful act or omission of the respondents, thus disposing of each of
the three cases by denying the petitions.

In their Joint Motion for Reconsideration, petitioners argued that the existence and veracity of the OB
List had already been confirmed by respondents themselves through their statements to the media, hence,
respondents' personal authorship thereof need not be proven by substantial evidence.

ISSUE
Whether or not a Writ Amparo should be issued in favor of the petitioners.

HELD
No. The writ of amparo was promulgated by the Court pursuant to its rule-making powers in response
to the alarming rise in the number of cases of enforced disappearances and extrajudicial killings. It plays
the preventive role of breaking the expectation of impunity in the commission of extralegal killings and
enforced disappearances, as well as the curative role of facilitating the subsequent punishment of the
perpetrators. In Tapuz v. Del Rosario, the Court has previously held that the writ of amparo is an
extraordinary remedy intended to address violations of, or threats to, the rights to life, liberty or security
and that, being a remedy of extraordinary character, it is not one to issue on amorphous or uncertain
grounds but only upon reasonable certainty. Hence, every petition for the issuance of the writ is required
to be supported by justifying allegations of fact on the following matters:

(a) The personal circumstances of the petitioner;

(b) The name and personal circumstances of the respondent responsible for the threat, act or omission,
or, if the name is unknown or uncertain, the respondent may be described by an assumed appellation;
(c) The right to life, liberty and security of the aggrieved party violated or threatened with violation by an
unlawful act or omission of the respondent, and how such threat or violation is committed with the
attendant circumstances detailed in supporting affidavits;
(d) The investigation conducted, if any, specifying the names, personal circumstances, and addresses of
the investigating authority or individuals, as well as the manner and conduct of the investigation,
together with any report;
(e) The actions and recourses taken by the petitioner to determine the fate or whereabouts of the
aggrieved party and the identity of the person responsible for the threat, act or omission; and
(f) The relief prayed for. The petition may include a general prayer for other just and equitable reliefs.
To determine whether or not a Writ of Amparo is in order there has to be a determination on whether the
totality of evidence satisfies the degree of proof required under the Amparo Rule. Sections 17 and 18 of
the Rule on the Writ of Amparo provide as follows:

SEC. 17. Burden of Proof and Standard of Diligence Required. – The parties shall establish their
claims by substantial evidence.
xxxx
SEC. 18. Judgment. – The court shall render judgment within ten (10) days from the time the petition
is submitted for decision. If the allegations in the petition are proven by substantial evidence, the
court shall grant the privilege of the writ and such reliefs as may be proper and appropriate; otherwise,
the privilege shall be denied.

Substantial evidence is that amount of relevant evidence which a reasonable mind might accept as
adequate to support a conclusion. It is more than a mere imputation of wrongdoing or violation that
would warrant a finding of liability against the person charged. The summary nature of amparo
proceedings, as well as, the use of substantial evidence as standard of proof shows the intent of the
framers of the rule to address situations of enforced disappearance and extrajudicial killings, or threats
thereof, with what is akin to administrative proceedings.

In Razon, Jr. v. Tagitis, the Court laid down a new standard of relaxed admissibility of evidence to enable
amparo petitioners to meet the required amount of proof showing the State's direct or indirect
involvement in the purported violations and found it a fair and proper rule in amparo cases “to consider
all the pieces of evidence adduced in their totality” and “to consider any evidence otherwise
inadmissible under our usual rules to be admissible if it is consistent with the admissible
evidence adduced.” Put simply, evidence is not to be rejected outright because it is inadmissible under
the rules for as long as it satisfies “the most basic test of reason – i.e., relevance of the evidence
to the issue at hand and its consistency with all other pieces of adduced evidence.”

This measure of flexibility in the admissibility of evidence, however, does not do away with the
requirement of substantial evidence in showing the State's involvement in the enforced disappearance,
extrajudicial killing or threats thereof. It merely permits, in the absence of hard-to-produce direct
evidence, a closer look at the relevance and significance of every available evidence, including those that
are, strictly speaking, hearsay where the circumstances of the case so require, and allows the
consideration of the evidence adduced in terms of their consistency with the totality of the evidence.
Without substantial evidence of an actual threat to petitioners' rights to life, liberty and security that
consists more than just the inclusion of their names in an OB List, an order for further investigation into,
or production of, the military's Order of Battle, would have no concrete basis.

The statement of Representative Ocampo that the respondents are the real source of the OB List is
unquestionably hearsay evidence because, except for the fact that he himself received the OB List from
an unnamed source merely described as “a conscientious soldier,” he had no personal knowledge
concerning its preparation. But even if the Court were to apply the appropriate measure of flexibility in
the instant cases by admitting the hearsay testimony of Representative Ocampo, a consideration of this
piece of evidence to the totality of those adduced, namely, the Press Releases issued by the 10th ID
admitting the existence of a military-prepared Order of Battle, the affidavits of petitioners attesting to the
threatening visits and tailing of their vehicles by menacing strangers, as well as the violent deaths of
alleged militant personalities, leads to the conclusion that the threat to petitioners' security has not
be adequately proven.
BATALLER_JudicialHierarchy

AUDI AG V. MEJIA
G.R. NO. 167533, July 27 2007

FACTS:

Audi AG (petitioner) appointed Proton (respondent), as its sole assembler and distributor of Audi cars in
the Philippines under an Assembly Agreement and a Distributorship Agreement. By reason of this, Proton
was induced to open, promote, develop and sell Audi brand cars in the Philippines upon petitioner’s
representation that Proton will be the exclusive assembler and distributor of Audi cars and local parts
manufacturer for export purposes for a period of 12 months. However, it turned out that Petitioner did
not include the Philippines in its ASEAN Assembly Strategy Program, thus frustrating respondent
Proton’s assembly preparations; that with evident bad faith, petitioner has been negotiating for the
transfer of the distributorship of the Audi cars to a third party; and that both respondents were surprised
when they received from petitioner a letter terminating the assembly and the distributorship agreements.

Before us is the instant Petition for Certiorari under Rule 65 of the 1997 Rules of Civil Procedure, alleging
that respondent Executive Judge Jules A. Mejia of RTC Pangasinan acted with grave abuse of discretion in
issuing an order directing the issuance of a TRO effective for 20 days, enjoining petitioner from
terminating the contracts executed by the parties, and directing it or any person claiming rights under it,
to maintain the status quo ante.

ISSUE:

W/N the petition is valid

HELD:

No. The petition is dismissed.

We cannot ignore the fatal defects in the petition:

First, Petitioner failed to file with the trial court the requisite motion for reconsideration of the challenged
Order before resorting to the instant recourse. The well-established rule is that a motion for
reconsideration is an indispensable condition before an aggrieved party can resort to the special civil
action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, as amended. Thus, petitioner
should have first filed with the trial court a motion for reconsideration, as such special civil action may be
resorted to only when “there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary
course of law.” Such indispensable requirement may, in well recognized instances, be glossed over to
prevent a miscarriage of justice, or when the need for relief is extremely urgent and certiorari is the only
adequate and speedy remedy available. Petitioner failed to show sufficient justification for its failure to
comply with the requirement.

We cannot accept petitioner’s submission that a motion for reconsideration “is unnecessary” as its
petition raises a question of law and that the assailed Order is a patent nullity. Petitioner may not arrogate
unto itself the determination of whether a motion for reconsideration is necessary or not. Its submission
runs counter to the purpose of the rule that a motion for reconsideration would afford the erring court or
agency an opportunity to rectify the error/s it may have committed without the intervention of a higher
court. Such motion is not only an expeditious remedy of an aggrieved party but also obviates an
improvident and unnecessary recourse to appellate proceedings.

Second, Petitioner, by filing directly with this Court its petition, has ignored the established rule on
hierarchy of courts. It must be stressed that the Court of Appeals and the Supreme Court have original
concurrent jurisdiction over petitions for certiorari. The rule on hierarchy of courts determines the venue
of appeals. Such rule is necessary to prevent inordinate demands upon the Court’s precious time and
attention which are better devoted to matters within its exclusive jurisdiction, and to prevent further
overcrowding of the Court’s docket. Thus, petitioner should have filed with the Court of Appeals its
petition, not directly with this Court. While such rule may be relaxed for special and important reasons
clearly and specifically set out in the petition, however, in the instant case, petitioner failed to discharge
that burden.

We stress that the rules of procedure exist for a noble purpose, and to disregard such rules in the guise of
liberal construction would be to defeat such purpose. Procedural rules are not to be disdained as mere
technicalities. They may not be ignored to suit the convenience of a party. Adjective law ensures the
effective enforcement of substantive rights through the orderly and speedy administration of justice.
Rules are not intended to hamper litigants or complicate litigation. But they help provide for a vital
system of justice where suitors may be heard following judicial procedure and in the correct forum. Public
order and our system of justice are well served by a conscientious observance by the parties of the
procedural rules.
CANAPE_JudicialHierarchy

Delos Reyes v People

GR No. 138297 January 27, 2006

FACTS:

The instant case stemmed from a complaint filed with the Municipal Trial Court (MTC) of
Calauan, Laguna by the Philippine Coconut Authority against Desiderio De los Reyes and Myrna
Villanueva, petitioners, and several others for violation of Republic Act No. 8048, otherwise known as The
Coconut Preservation Act of 1995, docketed as Criminal Case No. 6768. The complaint reads:

That on August, September and October 1996 in Brgy. Imok, Calauan, Laguna, the above named
respondents did then and there willfully, unlawfully and feloniously cut down and processed more or less
FOUR HUNDRED and FORTY (440) coconut trees without the required permit to cut from the Philippine
Coconut Authority in gross violation of the provisions of R.A. 8048 or the Coconut Preservation Act of
1995.
On January 31, 1997, the MTC ordered the accused, including petitioners, to file their counter-affidavits
within ten (10) days from notice.
On March 4, 1997, petitioners, instead of submitting their counter-affidavits, filed a Motion for
Preliminary Investigation.
On May 13, 1997, the MTC denied the motion on the ground that in cases cognizable by the MTCs, an
accused is not entitled to a preliminary investigation.
On June 4, 1997, petitioners filed a Motion To Quash the complaint on the ground that the allegations
therein do not constitute an offense.
On October 15, 1997, the MTC issued an Order denying the motion and requiring anew all the accused to
file their counter-affidavits within five (5) days from notice.
Petitioners then filed a petition for certiorari, prohibition, and mandamus with the RTC, docketed as Civil
Case No. 2494-97-C. They alleged that the MTC committed grave abuse of discretion amounting to lack or
excess of jurisdiction when it denied their Motion To Quash.
In an Order dated February 16, 1998, the RTC dismissed the petition and ruled that the MTC did not
gravely abuse its discretion considering that the allegations in the complaint, if hypothetically admitted,
are sufficient to constitute the elements of the offense.
Petitioners seasonably filed a motion for reconsideration, but this was denied by the RTC in its Order of
March 31, 1998.
Petitioners then interposed an appeal to the Court of Appeals.
On November 20, 1998, the Appellate Court rendered its Decision affirming the RTC Orders dated
February 16 and March 31, 1998, holding that since petitioners are raising a question of law, they should
have filed a petition for review on certiorari with the Supreme Court.
Petitioners filed a motion for reconsideration but it was denied by the Court of Appeals in its Resolution of
March 19, 1999.
Thus, petitioners filed with this Court the instant petition for certiorari assailing the Orders of the RTC in
Civil Case No. 2494-97-C dismissing their petition for certiorari on the ground that the MTC did not
gravely abuse its discretion.

ISSUE: Whether or not petitioners followed the hierarchy of courts in filing the complaint.
HELD: The Supreme Court said that there was no procedural lapse when petitioners initially appealed
the RTC Orders to the Court of Appeals. But what they should have done after the Appellate Court
rendered its Decision affirming the RTC Orders was to seasonably file with this Court an appeal via a
petition for review on certiorari pursuant to Rule 45 of the 1997 Rules of Civil Procedure, as amended.
Instead, as earlier mentioned, what they filed with this Court is this petition for certiorari under Rule 65
of the same Rules. Time and again, certiorari is not a substitute for a lost appeal.

Even assuming that the instant petition for certiorari is in order, still we have to dismiss the same.
Petitioners failed to observe the principle of hierarchy of courts. They should have filed their petition for
certiorari with the Court of Appeals. Pursuant to Section 9 of Batas Pambansa Blg. 129, as amended, the
Court of Appeals has original jurisdiction to issue, among others, a writ of certiorari.
Moreover, records indicate that they filed with this Court the instant petition for certiorari on May 6,
1999. They received a copy of the RTC Order denying their motion to dismiss on March 2, 1998. On April
21, 1998, they received a copy of the Order denying their motion for reconsideration. Under Section 4,
Rule 65 of the same Rules, they had sixty (60) days from April 21, 1998 to file this petition for certiorari.
However, they filed it only on May 6, 1999, or after one (1) year.
Even on the merits of the case, this petition is vulnerable to dismissal. It is a dictum that when a motion to
quash in a criminal case is denied, the remedy is not certiorari, but for petitioners to go to trial without
prejudice to reiterating the special defenses invoked in their motion to quash. In the event that an adverse
decision is rendered after trial on the merits, an appeal therefrom is the next legal step.
PETITON DISMISSED.
CARILLO_JudicialHierarchy

COMELEC vs Quijano-Padilla

September 18, 2002 GR 151992

FACTS:

Philippine Congress passed "Voter's Registration Act of 1996. Pursuant thereto, COMELEC promulgated
a resolution approving in principle the Voter's Registration and Identification System Project (VRIS). The
VRIS Project envisions a computerized database system for the May 2004 Elections.

COMELEC issued invitations to pre-qualify and bid for the supply and installations of information
technology equipment and ancillary services for its VRIS Project. Private respondent PHOTOKINA's bid
was declared the winning bidder in the amount of P6.588 Billion Pesos. The parties then proceeded to
formalize the contract. However, the budget appropriated by Congress for the COMELECs modernization
project was only One (1) Billion Pesos and the bid of Photokina exceeds the budget.

Later, Chairman Benipayo, through various press releases and public statements, announced that the
VRIS Project has been junked or set aside. He further announced his plan to re-engineer the entire
modernization program of the COMELEC, emphasizing his intention to replace the VRIS Project.

PHOTOKINA filed with the Regional Trial Court, Branch 215, Quezon City a petition for mandamus,
prohibition and damages which Judge Quijano-Padilla granted.

Hence, the instant petition for certiorari filed by the OSG in behalf of then COMELEC Chairman
Benipayo and Commissioners.

PHOTOKINA filed a Comment with Motion to Dismiss, the present petition, on the ground that
the petition violates the doctrine of hierarchy of courts.

ISSUE:

W/N the doctrine of hierarchy of courts was violated

HELD:

NO. Petition granted.

GR: A higher court will not entertain a direct resort to it UNLESS the redress cannot be obtained in
the appropriate lower court.

XPN: Anent the alleged breach of the doctrine of hierarchy of courts, suffice it to say that it is not an iron-
clad dictum. On several instances where this Court was confronted with cases of national interest and of
serious implications, it never hesitated to set aside the rule and proceed with the judicial determination
of the case. The case at bar is of similar import. It is in the interest of the State that questions relating to
government contracts be settled without delay. This is more so when the contract, as in this case, involves
the disbursement of public funds and the modernization of our country’s election process, a project that
has long been overdue.
Castro, Marhen ST. _Judicial Hierarchy

United Claimants Association of NEA v. National Electrification Administration

G.R. No. 187107, January 31, 2012

FACTS:

This is an original action for Injunction to restrain and/or prevent the implementation of
Resolution Nos. 46 and 59, otherwise known as the National Electrification Administration (NEA)
Termination Pay Plan, issued by respondent NEA Board of Administrators. Petitioners are former
employees of NEA who were terminated from their employment with the implementation of the assailed
resolutions.

NEA is a government-owned and/or controlled corporation created in accordance with PD 269.

The NEA Board is empowered to organize or reorganize NEAs staffing structure. In order to enhance and
accelerate the electrification of the whole country, including the privatization of the National Power
Corporation, RA 9136, otherwise known as the Electric Power Industry Reform Act of 2001 (EPIRA Law),
was enacted. Correlatively, Sec. 3 of the law provides:

Section 3. Scope. - This Act shall provide a framework for the restructuring of the
electric power industry, including the privatization of the assets of NPC, the transition to the
desired competitive structure, and the definition of the responsibilities of the various
government agencies and private entities.

Thus, the Rules and Regulations to implement RA 9136 were issued. Under Sec. 3(b)(ii), Rule 33
of the Rules and Regulations, all the NEA employees and officers are considered terminated and the 965
plantilla positions of NEA vacant. President Gloria Macapagal- Arroyo then issued Executive Order No.
119 directing the NEA Board to submit a reorganization plan. Thus, the NEA Board issued the assailed
resolutions. Thereafter, the NEA implemented an early retirement program denominated as the Early
Leavers Program, giving incentives to those who availed of it and left NEA before the effectivity of the
reorganization plan. The other employees of NEA were terminated.

ISSUE:

Whether or not the Court has jurisdiction over the petition.

RULING:

Yes. Respondents argue that petitioners violated the principle of hierarchy of courts, pursuant to
which the petition should have been filed with the RTC first rather than with this Court directly.

Primarily, although this Court, the Court of Appeals and the Regional Trial Courts have
concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus
and injunction, such concurrence does not give the petitioner unrestricted freedom of choice of court
forum. In Heirs of Bertuldo Hinog v. Melicor, citing People v. Cuaresma, this Court made the following
pronouncements:

This Courts original jurisdiction to issue writs of certiorari is not exclusive. It is shared by
this Court with Regional Trial Courts and with the Court of Appeals. This concurrence of jurisdiction is
not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained
freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy
of courts. That hierarchy is determinative of the venue of appeals, and also serves as a general
determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for
that judicial hierarchy most certainly indicates that petitions for the issuance of
extraordinary writs against first level (inferior) courts should be filed with the Regional
Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of
the Supreme Courts original jurisdiction to issue these writs should be allowed only when
there are special and important reasons therefor, clearly and specifically set out in the
petition. This is [an] established policy. It is a policy necessary to prevent inordinate demands upon the
Courts time and attention which are better devoted to those matters within its exclusive jurisdiction, and
to prevent further over-crowding of the Courts docket.

Evidently, the instant petition should have been filed with the RTC. However, as an exception to
this general rule, the principle of hierarchy of courts may be set aside for special and important reasons.
Such reason exists in the instant case as it involves the employment of the entire plantilla of NEA, more
than 700 employees who were effectively dismissed from employment in one swift stroke.
DELAROSA-REID_JudicialHierarchy

G.R. No. 194994 April 16, 2013

EMMANUEL A. DE CASTRO, Petitioner,
vs.
EMERSON S. CARLOS, Respondent.

FACTS: In 2009, petitioner was appointed as assistant general manager for operations of the MMDA.
Meanwhile, executive secretary Ochoa issued Office of the President (OP) Memorandum Circular No. 2,
Series of 2010, amending OP Memorandum Circular No. 1, Series of 2010 which provided for a
mandatory separation from service for all non-Career Executive Service Officials (non-CESO) occupying
Career Executive Service (CES) positions in all agencies of the executive branch. Tolentino, as chairman of
MMDA then appointed respondent as the OIC of the AGMO and the petitioner as the Legal and
Legislative Affairs Office, Office of the General Manager. Thereafter, the name of petitioner was stricken
off the MMDA payroll, and he was no longer paid his salary beginning November 2010.

Petitioner sought a clarification from the Career Executive Service Board (CESB) as to the proper
classification of the position of AGMO. It was learned that the position of AGMO had not yet been
classified and could not be considered as belonging to the Career Executive Service (CES). Petitioner was
later offered the position of Director IV of MMDA Public Health and Safety Services and/or MMDA
consultant. He turned down the offer, claiming that it was a demotion in rank.

He then demanded payment of his salary and reinstatement in the monthly payroll. For his failure to
obtain an action or a response from MMDA, he then made a formal demand for his reinstatement as
AGMO through a letter addressed to the Office of the President on 17 December 2010.However, on 4
January 2011, President Benigno S. Aquino III (President Aquino) appointed respondent as the new
AGMO of the MMDA. On 10 January 2011, the latter took his oath of office.

ISSUE: Whether or not petitioner is correct in conducting a direct recourse to the Supreme Court by
petitioner, who thereby failed to adhere to the doctrine of hierarchy of courts.

HELD: No. Petition must be dismissed.

Petitioner submits that a direct recourse to this Court is warranted by the urgent demands of public
interest, particularly the veritable need for stability in the civil service and the protection of the rights of
civil servants. Considering that no other than the President of the Philippines is the appointing authority,
petitioner doubts if a trial court judge or an appellate court justice, with a prospect of promotion in the
judiciary would be willing to go against a presidential appointment. Although Section 5(1) of Article VIII
of the 1987 Constitution explicitly provides that the Supreme Court has original jurisdiction over petitions
for certiorari, prohibition, mandamus, quo warranto, and habeas corpus, the jurisdiction of this Court is
not exclusive but is concurrent with that of the Court of Appeals and regional trial court and does not give
petitioner unrestricted freedom of choice of court forum. The hierarchy of courts must be strictly
observed.

Settled is the rule that "the Supreme Court is a court of last resort and must so remain if it is to
satisfactorily perform the functions assigned to it by the fundamental charter and immemorial tradition."
A disregard of the doctrine of hierarchy of courts warrants, as a rule, the outright dismissal of a petition.

A direct invocation of this Court’s jurisdiction is allowed only when there are special and important
reasons that are clearly and specifically set forth in a petition. The rationale behind this policy arises from
the necessity of preventing (1) inordinate demands upon the time and attention of the Court, which is
better devoted to those matters within its exclusive jurisdiction; and (2) further overcrowding of the
Court’s docket.
In this case, petitioner justified his act of directly filing with this Court only when he filed his Reply and
after respondent had already raised the procedural infirmity that may cause the outright dismissal of the
present Petition. Petitioner likewise cites stability in the civil service and protection of the rights of civil
servants as rationale for disregarding the hierarchy of courts.

Petitioner’s excuses are not special and important circumstances that would allow a direct recourse to this
Court. More so, mere speculation and doubt to the exercise of judicial discretion of the lower courts are
not and cannot be valid justifications to hurdle the hierarchy of courts.
DELEON_TranscendentalImportance

UNITED CLAIMANTS ASSOCIATION OF NEA v. NATIONAL ELECTRIFICATION

ADMINISTRATION
G.R. No. 187107 January 31, 2012

FACTS:
Respondent NEA is a government-owned controlled corporation created in accordance with PD 269.
Under the said decree, the NEA Board is empowered to organize or reorganize NEA’s staffing structure.
Thereafter, RA 9136 or the Electric Power Industry Reform Act (EPIRA Law) was enacted to restructure
the electric power industry and imposed upon respondent additional mandates in relation to the
promotion of the role of rural electric cooperatives to achieve national electrification. Its Implementing
Rules and Regulations provides that all the NEA employees and officers are considered terminated.

Upon EO 119 directing respondent NEA to submit a reorganization plan, it issued a Termination Pay Plan
which effectively terminated petitioners who are former employees of the respondent.

Petitioners filed an action for Injunction to restrain or prevent the implementation of the said
Termination Pay Plan. Respondents argue that Injunction is improper in this case given that the assailed
resolutions of the NEA Board have long been implemented, therefore moot and academic.

ISSUE:
Whether or not the remedy of Injunction is still available

HELD:
YES. The principle of mootness is subject to exceptions, such as when the case is of transcendental
importance.

As a rule, the Writ of Prohibition will not lie to enjoin acts already done. However, as an exception to the
rule on mootness, courts will decide a question otherwise moot if it is capable of repetition yet evading
review.

In the instant case, while the assailed resolutions of the NEA Board may have long been implemented,
such acts of the NEA Board may well be repeated by other government agencies in the reorganization of
their offices. Petitioners have not lost their remedy of injunction.
DELROSARIO_DoctrineOfNonInterference

PHILIPPINE SINTER CORPORATION and PHIVIDEC INDUSTRIAL AUTHORITY

vs.
CAGAYAN ELECTRIC POWER and LIGHT CO., INC.

G.R. No. 127371 April 25, 2002

Facts: Pres. Corazon Aquino issued Cabinet Memorandum, Item No. 2 which provides that direct
connection to NPC (now NAPOCOR) of industries authorized under BOI-NPC is no longer necessary in
the franchise area of the specific utility or cooperative. Pursuant to such memorandum, respondent
CEPALCO, a grantee of a legislative franchise to distribute electric power to the municipalities of
Villanueva, Jasaan and Tagoloan, and the city of Cagayan de Oro, all on the province of Misamis Oriental,
filed with the Energy Regulatory Board (ERB) a petition seeking to discontinue all existing direct supply
of power by NAPOCOR within CEPALCO's franchise area.

The ERB granted the petition of CEPALCO. Both the CA and SC affirmed such decision hence
ERB’s decision became final and executory. To implement ERB’s decision, CEPALCO wrote Philippine
Sinter Corporation (PSC), petitioner, and advised the latter of its desire "to have the power supply of PSC,
directly taken from NAPOCOR, disconnected, cut and transferred" to CEPALCO. PSC is an entity
operating its business within the PHIVIDEC Industrial Estate located in the Municipalities of Tagoloan
and Villanueva which is covered by CEPALCO's franchise. PSC refused CEPALCO's request, citing its
contract for power supply with NAPOCOR effective until July 26, 1996. To restrain the execution of the
ERB Decision, PSC and PIA filed a complaint for injunction against CEPALCO with the Regional Trial
Court of Cagayan de Oro City to which the trial court rendered a decision in favor of PSC and PIA while
CA reversed such decision hence the current petition.

Issue: whether or not injunction lies against the final and executory judgment of the ERB

Held: No, injunction cannot lie against the final and executory judgment of the ERB.

The rule indeed is that after a judgment has gained finality, it becomes the ministerial duty of the
court to order its execution. No court, perforce, should interfere by injunction or otherwise to restrain
such execution. Clearly, an injunction to stay a final and executory decision is unavailing except only
after a showing that facts and circumstances exist which would render execution unjust or inequitable, or
that a change in the situation of the parties occurred. Here, no such exception exists as shown by the facts
earlier narrated. To disturb the final and executory decision of the ERB in an injunction suit is to brazenly
disregard the rule on finality of judgments.

We have stated before, and reiterate it now, that administrative decisions must end sometime, as
fully as public policy demands that finality be written on judicial controversies. Public interest requires
that proceedings already terminated should not be altered at every step, for the rule of non quieta
movere prescribes that what had already been terminated should not be disturbed.

Corollary, Section 10 of Executive Order No. 172 (the law creating the ERB) provides that a review
of its decisions or orders is lodged in the Supreme Court. Settled is the rule that where the law provides
for an appeal from the decisions of administrative bodies to the Supreme Court or the Court of Appeals, it
means that such bodies are co-equal with the Regional Trial Courts in terms of rank and stature, and
logically, beyond the control of the latter. Hence, the trial court, being co-equal with the ERB, cannot
interfere with the decision of the latter. It bears stressing that this doctrine of non-interference of trial
courts with co-equal administrative bodies is intended to ensure judicial stability in the administration of
justice whereby the judgment of a court of competent jurisdiction may not be opened, modified or vacated
by any court of concurrent jurisdiction.
DIOLA_DoctrineOfPrimaryJurisdiction

OMICTIN vs. COURT OF APPEALS

(G.R. No.148004, January 22, 2007)

FACTS:

This is a petition for certiorari with prayer for a writ of preliminary injunction seeking the nullification of
the decision rendered by the (CA). In its assailed decision, the CA declared the existence of a prejudicial
question and ordered the suspension of the criminal proceedings initiated by petitioner Vincent E.
Omictin on behalf of Saag Phils., Inc. against private respondent George I. Lagos, in view of a pending
case before the Securities and Exchange Commission (SEC) filed by the latter against the former, Saag
Pte. (S) Ltd., Nicholas Ng, Janifer Yeo and Alex Y. Tan.

The facts are as follows:

Petitioner Omictin, Operations Manager Ad Interim of Saag Phils., Inc., filed a complaint for two counts
of estafa against private respondent Lagos. He alleged that private respondent, despite repeated demands,
refused to return the two company vehicles entrusted to him when he was still the president of Saag
Phils., Inc..

On June 24, 1999, private respondent filed a motion to suspend proceedings on the basis of a prejudicial
question because of a pending petition with the Securities and Exchange Commission (SEC) involving the
same parties.

It appears that on January 7, 1999, private respondent filed SEC Case No. 01-99-6185 for the declaration
of nullity of the respective appointments of Alex Y. Tan and petitioner as President Ad Interim and
Operations Manager Ad Interim of Saag Phils

In the action before the SEC, private respondent averred that Saag (S) Pte. Ltd. is a foreign corporation
organized and existing under the laws of Singapore, and is fully owned by Saag Corporation. On July 1,
1994, he was appointed as Area Sales Manager in the Philippines. Pursuant to his appointment,
respondent was authorized to organize a local joint venture corporation to be known as Saag Philippines,
Inc. Saag Philippines, Inc. was incorporated with Saag (S) Pte. Ltd. as the majority stockholder. He was
elected as the president of the corporation.

Later, due to intra-corporate disputes, two of the board of directors resigned and divested their shares in
Saag Corporation (Bhd), thereby resulting in a change in the controlling interest in Saag (S) Pte. Ltd.

Barely three months after, private respondent resigned his post as president of Saag Phils., Inc. while still
retaining his position as a director of the company. According to private respondent, the joint venture
agreement (JVA) between him or Saag Phils., Inc. and Saag (S) Pte. Ltd. provided that should the
controlling interest in the latter company, or its parent company Saag Corp. (Bhd), be acquired by any
other person or entity without his prior consent, he has the option either to require the other stockholders
to purchase his shares or to terminate the JVA and dissolve Saag Phils., Inc. altogether.

On September 30, 1998, the board of director issued a letter appointing Alex Y. Tan as President Ad
Interim of Saag Phils., Inc. Tan, in turn, appointed petitioner Omictin as the company’s Operations
Manager Ad Interim.
Citing as a reason the absence of a board resolution authorizing the continued operations of Saag Phils.,
Inc., private respondent retained his possession of the office equipment of the company in a fiduciary
capacity as director of the corporation pending its dissolution and/or the resolution of the intra-corporate
dispute. Private respondent stressed that Tan’s appointment was invalid because it was in derogation of
the company by-laws.

The trial court denied respondent’s motion to suspend proceedings and motion to recuse.

The CA held that it is clear that a prejudicial question exists which calls for the suspension of the criminal
proceedings before the lower court

On January 18, 2001, the SEC case as transferred to the Regional Trial Court (RTC) of Mandaluyong
pursuant to the implementing rules of the Securities and Regulation Code vesting in the RTCs jurisdiction
over intra-corporate disputes.

Petitioner argues that:

1. The action before the SEC and the criminal case before the trial court do not involve any prejudicial
question – the SEC Case mainly involves the dissolution of Saag (S) Pte. Ltd. The entity which is being
sued is Saag (S) Pte. Ltd., over which the SEC has yet to acquire jurisdiction. Hence, any decision that
may be rendered in the SEC case will neither be determinative of the innocence or guilt of the accused
nor bind Saag Phils., Inc. because the same was not made a party to the action even if the former is its
holding corporation;

2. Saag Phils., Inc. has a separate corporate existence and is to be treated as a separate entity from its
holding or parent company, Saag (S) Pte. Ltd.

ISSUE: Whether or not a prejudicial question exists to warrant the suspension of the criminal proceedings
against private respondent because of the pending case under the RTC.

RULING:

YES, there exists a prejudicial question.

A prejudicial question is defined as that which arises in a case, the resolution of which is a logical
antecedent of the issue involved therein and the cognizance of which pertains to another tribunal.14 Here,
the case which was lodged originally before the SEC and which is now pending before the RTC of
Mandaluyong City by virtue of Republic Act No. 8799, involves facts that are intimately related to those
upon which the criminal prosecution is based.

Ultimately, the resolution of the issues raised in the intra-corporate dispute will determine the guilt or
innocence of private respondent in the crime of estafa filed against him by petitioner before the RTC of
Makati.

The doctrine of primary jurisdiction may be applied in this case. The issues raised by petitioner
particularly the status of Saag Phils., Inc. vis-à-vis Saag (S) Pte. Ltd., as well as the question regarding the
supposed authority of the latter to make a demand on behalf of the company, are proper subjects for the
determination of the tribunal hearing the intra-corporate case which in this case is the RTC of
Mandaluyong. These issues would have been referred to the expertise of the SEC in accordance with the
doctrine of primary jurisdiction had the case not been transferred to the RTC of Mandaluyong.
Strictly speaking, the objective of the doctrine of primary jurisdiction is to guide a court in determining
whether it should refrain from exercising its jurisdiction until after an administrative agency has
determined some question or some aspect of some question arising in the proceeding before the
court. The court cannot or will not determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to resolving the same, where the question demands the
exercise of sound administrative discretion requiring special knowledge, experience and services in
determining technical and intricate matters of fact.

While the above doctrine refers specifically to an administrative tribunal, the Court believes that the
circumstances in the instant case do not proscribe the application of the doctrine, as the role of an
administrative tribunal such as the SEC in determining technical and intricate matters of special
competence has been taken on by specially designated RTCs by virtue of Republic Act No. 8799.

Hence, the RTC of Mandaluyong where the intra-corporate case is pending has the primary jurisdiction to
determine the issues under contention relating to the status of the domestic corporation, Saag Phils., Inc.,
vis-à-vis Saag Pte. Ltd.; and the authority of petitioner to act on behalf of the domestic corporation, the
determination of which will have a direct bearing on the criminal case. The law recognizes that, in place of
the SEC, the regular courts now have the legal competence to decide intra-corporate disputes.

In view of the foregoing, the Court finds no substantial basis in petitioner’s contention that the CA
committed grave abuse of discretion amounting to lack or excess of jurisdiction. Absent a showing of a
despotic, whimsical and arbitrary exercise of power by the CA, the petition must fail.
DIZON_DoctrineOfPrimaryJurisdiction

REPUBLIC VS. CARLITO LACAP

G.R. No. 158253 March 2, 2007

FACTS:

The District Engineer of Pampanga issued and published an "Invitation To Bid" where Lacap,
doing business under the name and style Carwin Construction and Construction Supply was pre-qualified
together with two other contractors. Being the lowest bidder, Lacap was awarded the contract for the
concreting of Sitio 5 Bahay Pare. Accordingly, respondent undertook the works, made advances for the
purchase of the materials and payment for labor costs.

On October 29, 1992, personnel of the Office of the District Engineer of San Fernando, Pampanga
conducted a final inspection of the project and found it 100% completed in accordance with the approved
plans and specifications. Thereafter, Lacap sought to collect payment for the completed project. However,
the DPWH withheld payment from respondent after the District Auditor of the Commission on Audit
(COA) disapproved the final release of funds on the ground that the contractor’s license of respondent had
expired at the time of the execution of the contract. The District Engineer sought the opinion of the
DPWH Legal Department. DPWH Legal Department opined that since Republic Act No. 4566 (R.A. No.
4566), otherwise known as the Contractor’s License Law, does not provide that a contract entered into
after the license has expired is void and there is no law which expressly prohibits or declares void such
contract, the contract is enforceable and payment may be paid, without prejudice to any appropriate
administrative liability action that may be imposed on the contractor and the government officials or
employees concerned.

In a First Indorsement, the Director III of the Legal Department recommended that payment
should be made to Carwin Construction. Despite such recommendation for payment, no payment was
made to respondent. Hence, the Lacap filed the complaint for Specific Performance and Damages against
petitioner before the RTC.

Petitioner, through the Office of the Solicitor General (OSG), filed a Motion to Dismiss the
complaint on the grounds that the complaint states no cause of action and that the RTC had no
jurisdiction over the nature of the action since respondent did not appeal to the COA the decision of the
District Auditor to disapprove the claim.

Following the submission of respondent’s Opposition to Motion to Dismiss, the RTC issued an
Order denying the Motion to Dismiss. The OSG filed a Motion for Reconsideration but it was likewise
denied by the RTC. The OSG, then, filed its Answer invoking the defenses of non-exhaustion of
administrative remedies and the doctrine of non-suability of the State.

Following trial, the RTC rendered its Decision ordering DPWH to pay Lacap for the contract of
the project, 12% interest from demand until fully paid, and the costs of the suit. The CA affirmed the
decision but lowered interest to 6%.
ISSUES:
W/N the Court of Appeals erred in not finding that respondent has no cause of action against petitioner
considering that:

(a) Respondent failed to exhaust administrative remedies; and

(b) It is the Commission on Audit which has the primary jurisdiction to resolve respondent’s money
claim against the government.

RULING:

No. The general rule is that before a party may seek the intervention of the court, he should first
avail of all the means afforded him by administrative processes. The issues which administrative agencies
are authorized to decide should not be summarily taken from them and submitted to a court without first
giving such administrative agency the opportunity to dispose of the same after due deliberation.

Corollary to the doctrine of exhaustion of administrative remedies is the doctrine of primary jurisdiction;
that is, courts cannot or will not determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to the resolution of that question by the administrative
tribunal, where the question demands the exercise of sound administrative discretion requiring the
special knowledge, experience and services of the administrative tribunal to determine technical and
intricate matters of fact.

Nonetheless, the doctrine of exhaustion of administrative remedies and the corollary doctrine of primary
jurisdiction, which are based on sound public policy and practical considerations, are not inflexible rules.
There are many accepted exceptions, such as: (a) where there is estoppel on the part of the party invoking
the doctrine; (b) where the challenged administrative act is patently illegal, amounting to lack of
jurisdiction; (c) where there is unreasonable delay or official inaction that will irretrievably
prejudice the complainant; (d) where the amount involved is relatively small so as to make the rule
impractical and oppressive; (e) where the question involved is purely legal and will ultimately
have to be decided by the courts of justice; (f) where judicial intervention is urgent; (g) when its
application may cause great and irreparable damage; (h) where the controverted acts violate due process;
(i) when the issue of non-exhaustion of administrative remedies has been rendered moot; (j) when there
is no other plain, speedy and adequate remedy; (k) when strong public interest is involved; and, (l) in quo
warranto proceedings. Exceptions (c) and (e) are applicable to the present case.

Notwithstanding the legal opinions of the DPWH Legal Department rendered in 1993 and 1994 that
payment to a contractor with an expired contractor’s license is proper, respondent remained unpaid for
the completed work despite repeated demands. Clearly, there was unreasonable delay and official inaction
to the great prejudice of respondent.

Furthermore, whether a contractor with an expired license at the time of the execution of its contract is
entitled to be paid for completed projects, clearly is a pure question of law. It does not involve an
examination of the probative value of the evidence presented by the parties. There is a question of law
when the doubt or difference arises as to what the law is on a certain state of facts, and not as to the truth
or the falsehood of alleged facts. Said question at best could be resolved only tentatively by the
administrative authorities. The final decision on the matter rests not with them but with the courts of
justice. Exhaustion of administrative remedies does not apply, because nothing of an administrative
nature is to be or can be done. The issue does not require technical knowledge and experience but one that
would involve the interpretation and application of law.
Thus, while it is undisputed that the District Auditor of the COA disapproved respondent’s claim against
the Government, and, under Section 48 of P.D. No. 1445, the administrative remedy available to
respondent is an appeal of the denial of his claim by the District Auditor to the COA itself, the Court holds
that, in view of exceptions (c) and (e) narrated above, the complaint for specific performance and
damages was not prematurely filed and within the jurisdiction of the RTC to resolve, despite the failure to
exhaust administrative remedies.
DONA_ContinuingJurisdiction

ABAD, ET AL. v. RTC OF MANILA and THE PHILIPPINE AMERICAN GENERAL

INSURANCE COMPANY, INC.

G.R. No. L-65505 October 12, 1987

Facts:

Petitioners filed against respondent PHILAMGEN for the enforcement of contract and recovery of
loss of money for the payment of the money value of the respective accumulated sick leave with pay of the
separated employees of respondent company. Instead of filing an answer thereto, PHILAMGEN moved to
dismiss the complaint, which the trial court granted in its order. Petitioners filed a petition for Certiorari
after a denial of their motion to reconsider the aforesaid Order.

The case was remanded to the trial court for further proceedings. Respondent Philamgen filed its
Answer to the complaint. Due to judicial reorganization which abolished Courts of First Instance, the case
was re-raffled to respondent Regional Trial Court of Manila. Respondent court motu proprio, dismissed
the civil action for lack of jurisdiction over the subject made being money claims arising from employer-
employee relations without prejudice to plaintiff's pursuing their claims before the appropriate
administrative machineries in the Ministry of Labor & Employment.

Issue: W O N respondent Court lacks jurisdiction over the subject of the case.

Held:

Yes. The RTCs of today are essentially the same courts that functioned as CFIs before BP 129
(Judiciary Reorganization Act). However, whereas before jurisdiction over money claims of laborers and
employees appertained to Courts of First Instance, the same are now to be taken cognizance of by proper
entities in the Department of Labor and Employment.

At the time judicial reorganization took place, the law in force provided that when it comes to
labor-related action, initial jurisdiction is vested on "administrative machiner(ies)" provided "for the
expeditious settlement of labor or industrial disputes." The administrative jurisdiction vested by the law
upon the Labor Arbiters is "original and exclusive." It was the evident intention of the legislature to divest
the courts of general jurisdiction initial jurisdiction over cases such as that involved in this action. The
legislature intended to unclutter the courts of cases which may be adjudicated, in the first instance, by
officials or bodies exercising quasi-judicial adjudicatory powers.

Sec. 19 of BP 129 defines the jurisdiction of RTCs (which took the place of the abolished Courts of
First Instance), as:

In all cases not within the exclusive jurisdiction of any court, tribunal, person or body
exercising judicial or quasi-judicial functions.

The rule of adherence of jurisdiction until a cause is finally resolved or adjudicated does not
apply when the change in jurisdiction is curative in character. Thus, Courts of First Instance
/Regional Trial Courts no longer have jurisdiction over aforesaid monetary claims of labor.