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1 THIRD DIVISION KIMBERLY INDEPENDENT LABOR UNION FOR SOLIDARITY VS. COURT OF APPEALS GR NO. 149158-59 FACTS: The antecedent facts common to the consolidated cases are as follows: G.R. No. 772629 Per Ministry (now Department) of Labor and Employment (MOLE), UKCEO-PTGWO was declared as the exclusive bargaining representative of Kimberlys employees, having garnered the highest number of votes in the certification election. KILUSAN-OLALIA filed with this Court a petition for certiorari which was docketed as G.R. No. 77629 assailing the Order of the MOLE with prayer for a temporary restraining order. G.R. No. 78781 During the pendency of G.R. No. 77629, Kimberly dismissed from service several employees and refused to heed the workers grievances, impelling KILUSAN-OLALIA to stage a strike. Kimberly filed an injunction case with the NLRC, which prompted the latter to issue temporary restraining orders (TROs). The propriety of the issuance of the TROs was again brought by KILUSAN-OLALIA to this Court via a petition for certiorari and prohibition. G.R. Nos. 77629 and 78791 were eventually consolidated by this Court and decided. The dispositive portion of the decision reads as follows: WHEREFORE, judgment is hereby rendered in G.R. No. 77629: 1. Ordering the med-arbiter in Case No. R04-OD-M-4-1586 to open and count the 64 challenged votes, and that the union with the highest number of votes be thereafter declared as the duly elected certified bargaining representative of the regular employees of KIMBERLY; 2. Ordering KIMBERLY to pay the workers who have been regularized their differential pay with respect to minimum wage, cost of living allowance, 13th month pay, and benefits provided for under the applicable collective bargaining agreement from the time they became regular employees. All other aspects of the decision appealed from, which are not so modified or affected thereby, are hereby AFFIRMED. The temporary restraining order issued in G.R. No. 77629 is hereby made permanent. The petition filed in G.R. No. 78791 is hereby DISMISSED. G.R. Nos. 149158-59 On account of the strike, Kimberly filed a complaint to declare the strike illegal. As a counter-complaint, KILUSANOLALIA, its officers and members (herein petitioners) charged the company and its officers, among others, with unfair labor practice: union-busting and refusal to bargain; and violations of provisions of the Labor Code. Kimberly dismissed a number of workers for knowingly participating in an illegal strike and for committing illegal acts. Labor Arbiter Pedro C. Ramos resolved the case by 1. declaring the parties to be in pari delicto; 2. ordering the parties to cease and desist from committing the same or similar acts complained of; 3. ordering Kimberly Clark (Phil.), (sic)Inc. to reinstate all respondents and counter-complainants; 4. Ordering Kimberly Clark (Phil.), (sic)Inc. to pay the respondents and counter-complainants. On appeal by both parties, the NLRC rendered its decision saying that Kimberly was held not guilty of an unfair labor practice, precluding the application of the in pari delicto doctrine. Aggrieved, KILUSAN-OLALIA instituted a Petition for Certiorari with the Court of Appeals. The records disclose that Kimberly also filed a Petition for Certiorari before the CA questioning the same Orders of the NLRC. On September 5, 2000, the CA dismissed KILUSAN-OLALIAs petition on procedural grounds such as the verification was signed only by petitioners president, sans any board resolution or power of attorney authorizing anybody to sign the same and the certificate on non-forum shopping; and the attached complaint and amended complaint thereof are not legible copies. G.R. No. 156668 The DOLE ordered the payment of the differential wages and other benefits of the regularized workers. Kimberly, steadfast in its stand, filed a petition for certiorari before the appellate court, which was docketed as CA-G.R. SP No. 62257 alleging that the employees who were dismissed due to the illegal strike staged on May 17, 1987 (the subject of G.R. Nos. 149158-59) should not be awarded regularization differentials. On June 27, 2002, the CA dismissed Kimberlys petition. Kimberly

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elevated the case before the Supreme Court. On the recommendation of the Division Clerk of Court and in the interest of an orderly administration of justice, the Court, on May 24, 2004, ordered the consolidation of this case, G.R. No. 156668, with G.R. Nos. 149158-59. ISSUE: Whether it is proper in consolidating G.R. No. 156668, with G.R. Nos. 149158-59. Whether it is proper in dismissing G.R. Nos. 149158-59 based on sheer technicality and not in the merit of the petition itself. RULING: After thoroughly studying the voluminous records of these consolidated cases, however, the Court finds that petitioners KILUSAN-OLALIA, et al. in G.R. Nos. 149158-59 are raising essentially a procedural issue whether the CA erred in dismissing the petition on the sheer grounds of non-compliance with the requirements of the rule on verification and certification against non-forum shopping, and of non-submission of the legible copies of the pleadings filed in the labor tribunal. Petitioners have not brought up for our resolution the substantial issue of the legality of the May 17, 1987 strike. In fact, the petitioners prayed for a remand of their case to the CA which was the proper court to resolve said issue. On the other hand, petitioner Kimberly in G.R. No. 156668 raises the issue of the propriety of the inclusion in the DOLE Order of the two groups of employees: (1) casuals who have not rendered one year of service as of April 21, 1986, the filing date of KILUSANOLALIAs petition for certification election; and (2) the employees who were dismissed due to the illegal strike staged on May 17, 1987 (the subject of G.R. Nos. 149158-59). Kimberly contends in the main that only those employees who were parties in G.R. Nos. 77629 and 78791 should be included in the implementation order. As the consolidated cases do not involve a common question of law, the Court resolves to de-consolidate them. The Court find as sufficient in form the disputed verification and certification against forum shopping. In rendering justice, courts have always been, as they ought to be, conscientiously guided by the norm that on the balance, technicalities take a backseat vis--vis substantive rights, and not the other way around. This principle finds greater application in labor cases where social justice should be emphasized. In the instant case, despite the fact that Ernesto Facundo, the union president, was not shown to have been duly authorized to sign the verification on behalf of the other petitioners, the CA should not have been too strict in the application of the Rules. Necessarily, Facundo, being the union president, was in a position to verify the truthfulness and correctness of the allegations in the petition. Further, the petition was signed by the unions lawyer, who had been authorized by a majority of the petitioners to represent them and to sign on their behalf all pleadings and appeals relative to the labor dispute. On the legibility of the attached pleadings, particularly the complaint and the amended complaint, we find that the same may be excused given the antiquity of the said documents. Nevertheless, a perusal of the records reveals that the said pleadings are legible enough. Again, the rules of procedure shall be liberally construed in order to promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding. The Resolution of the Court, dated May 24, 2006, ordering the consolidation of G.R. Nos. 149158-59 and G.R. No. 156668 is RECALLED. The said cases are hereby DE-CONSOLIDATED; 2)In G.R. Nos. 149158-59:The petition is PARTIALLY GRANTED.The petitionis REMANDED to the Court of Appeals for adjudication onthe merits. The CA is further DIRECTED TOCONSOLIDATE CA-G.R. SP No. 60035 with CA-G.R. SP No. 60001, and to resolve the cases with dispatch. 3) As to G.R. No. 156668, the Court will resolve the same in a separate decision after the de-consolidation. SO ORDERED. 2 G.R. No. 159590 October 18, 2004 HSBC LIMITED, petitioner, vs. CECILIA DIEZ CATALAN, respondent. x----------------------------x G.R. No. 159591 October 18, 2004 HSBC INTERNATIONAL TRUSTEE LIMITED, petitioner, vs. CECILIA DIEZ CATALAN, respondent. FACTS: Respondent Cecilia Catalan filed before the RTC, a complaint for a sum of money with damages against petitioner HSBANK due to the alleged wanton refusal to pay her the value of five HSBANK

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checks issued by Frederick Arthur Thomson (Thomson) amounting to HK$3,200,000.00. Summons was served on HSBANK at the Enterprise Center, Tower I, Ayala Avenue corner Paseo de Roxas St., Makati City. Catalan also filed an Amended Complaint impleading petitioner HSBC TRUSTEE as co-defendant of HSBANK and invoking Article 19 of the Civil Code as basis for her cause of action. This resulted due to the death of the drawer Thomson and Catalan forwarded her demand to HSBC TRUSTEE but the latter refused to pay. Meanwhile, on October 17, 2001, summons for HSBC TRUSTEE was tendered to the In House Counsel of HSBANK (Makati Branch) at the Enterprise Center, Tower 1, Ayala Avenue corner Paseo de Roxas, Makati. Subsequently, HSBC TRUSTEE filed a Submission, dated November 15, 2001, attaching the Affidavit executed in Hongkong by Phoenix Lam, Senior Vice-President of HSBC TRUSTEE, attesting to the fact that: 1) HSBC TRUSTEE has not done nor is it doing business in the Philippines; 2) it does not maintain any office in Makati or anywhere in the Philippines; 3) it has not appointed any agent in Philippines; and 4) HSBANK Makati has no authority to receive any summons or court processes for HSBC TRUSTEE. On May 15, 2002, the RTC issued an Order denying the two motions to dismiss. In a consolidated Decision dated August 14, 2003, the CA dismissed the two petitions for certiorari. The CA held that the filing of petitioners answers before the RTC rendered moot and academic the issue of the RTCs lack of jurisdiction over the person of the petitioners; that the RTC has jurisdiction over the subject matter. ISSUE: 1) Does the complaint state a cause of action? 2) Did Catalan engage in forum-shopping by filing the complaint for damages when she also filed a petition for probate of the alleged last will of Thomson with another branch of the RTC? 3) Did the RTC acquire jurisdiction over HSBANK and HSBC TRUSTEE? Corollary thereto, did the filing of the answer before the RTC render the issue of lack of jurisdiction moot and academic? RULING: Does the complaint state a cause of action against HSBANK and HSBC TRUSTEE? In order to be liable under the abuse of rights principle, three elements must concur, to wit: (a) that there is a legal right or duty; (b) which is exercised in bad faith; and (c) for the sole intent of prejudicing or injuring another. In this instance, after carefully examining the amended complaint, we are convinced that the allegations therein are in the nature of an action based on tort under Article 19 of the Civil Code. It is evident that Catalan is suing HSBANK and HSBC TRUSTEE for unjustified and willful refusal to pay the value of the checks. Did Catalan engage in forum-shopping? Thus, there is forum-shopping when there exist: a) identity of parties, or at least such parties as represent the same interests in both actions, b) identity of rights asserted and relief prayed for, the relief being founded on the same facts, and c) the identity of the two preceding particulars is such that any judgment rendered in the pending case, regardless of which party is successful would amount to res judicata in the other. Applying the foregoing requisites to the case before us in relation to Spec. Proc No. 00-892, the probate proceeding brought by Catalan before RTC, Branch 48, Bacolod City, it is obvious that forum-shopping does not exist. There is no identity of parties. HSBANK is not a party in the probate proceeding. HSBC TRUSTEE is only a party in the probate proceeding because it is the executor and trustee named in the Hongkong will of Thomson. HSBC TRUSTEE is representing the interest of the estate of Thomson and not its own corporate interest. Did the RTC acquire jurisdiction over HSBANK and HSBC TRUSTEE? The Rules of Court provides that a court generally acquires jurisdiction over a person through either a valid service of summons in the manner required by law or the persons voluntary appearance in court. We find that both lower courts overlooked Section 20 of Rule 14 of the 1997 Rules of Civil Procedure which provides that "the inclusion in a motion to dismiss of other grounds aside from lack of jurisdiction over the person of the defendant shall not be deemed a voluntary appearance." Nonetheless, such omission does not aid HSBANKs case. It must be noted that HSBANK initially filed a Motion for Extension of Time to File Answer or Motion to Dismiss. HSBANK already

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invoked the RTCs jurisdiction over it by praying that its motion for extension of time to file answer or a motion to dismiss be granted. The Court has held that the filing of motions seeking affirmative relief, such as, to admit answer, for additional time to file answer, for reconsideration of a default judgment, and to lift order of default with motion for reconsideration, are considered voluntary submission to the jurisdiction of the court. In contrast, the filing by HSBC TRUSTEE of a motion to dismiss cannot be considered a voluntary submission to the jurisdiction of the RTC. It was a conditional appearance, entered precisely to question the regularity of the service of summons. It is settled that a party who makes a special appearance in court challenging the jurisdiction of said court, e.g., invalidity of the service of summons, cannot be considered to have submitted himself to the jurisdiction of the court. HSBC TRUSTEE has been consistent in all its pleadings in assailing the service of summons and the jurisdiction of the RTC over it. Thus, HSBC TRUSTEE cannot be declared in estoppel when it filed an Answer ad cautelam before the RTC while its petition for certiorari was pending before the CA. Admittedly, HSBC TRUSTEE is a foreign corporation, organized and existing under the laws of the British Virgin Islands. For proper service of summons on foreign corporations, Section 12 of Rule 14 of the Revised Rules of Court provides: SEC. 12. Service upon foreign private juridical entity. When the defendant is a foreign private juridical entity which has transacted business in the Philippines, service may be made on its resident agent designated in accordance with law for that purpose, or if there be no such agent, on the government official designated by law to that effect, or on any of its officers or agents within the Philippines. It does not appear at all that HSBC TRUSTEE had performed any act which would give the general public the impression that it had been engaging, or intends to engage in its ordinary and usual business undertakings in the country. Absent from the amended complaint is an allegation that HSBC TRUSTEE had performed any act in the country that would place it within the sphere of the courts jurisdiction. There being no proper service of summons, the RTC cannot take cognizance of the case against HSBC TRUSTEE for lack of jurisdiction over it. Accordingly, the complaint against HSBC TRUSTEE should have been dismissed for lack of jurisdiction over it. 3 Cabaluna SPOUSES RODOLFO CARPIO and REMEDIOS ORENDAIN, Petitioners, vs. RURAL BANK OF STO. TOMAS (BATANGAS), INC., Respondents Spouses carpio filed with the Regional Trial Court of Tanauan, Batangas, a Complaint (for annulment of foreclosure sale and damages) against the Rural Bank of Sto. Tomas, Batangas, Inc., respondent, and Jaime Ozaeta, clerk of court and ex-officio sheriff of the same court. In their Complaint, petitioners alleged that they are the absolute owners of a parcel of land located at Barangay San Vicente, Sto. Tomas, Batangas. Spouses obtained a loan from respondent bank. To secure the loan, they executed a real estate mortgage over the same property in favor of respondent bank. On July 26, 1996, without prior demand or notice to petitioners, respondent bank filed a Petition for Extra-Judicial Foreclosure of Mortgage. On September 26, 1996, sheriff Jaime Ozaeta conducted a public auction sale of the mortgaged property. Respondent bank was the only bidder. Petitioners further alleged that the sale was conducted without proper publication as the sheriffs notice of sale was published in a newspaper which is not of general circulation. On the same day the property was sold, the sheriff issued a certificate of sale in favor of respondent bank. respondent bank executed an affidavit of consolidation of ownership over petitioners property. They claimed that they were not notified of the foreclosure sale and were not given an opportunity to redeem their property. respondent bank filed its Answer with Counterclaim, denying specifically the material allegations of the complaint. It alleged inter alia that oral and written demands were made upon petitioners to pay their loan but they ignored the same; that they were properly notified of the filing of the petition for extra-judicial foreclosure of the mortgage; that there was proper publication and notices of the scheduled sale through public auction; and that petitioners were actually given more than two (2) years to redeem the property but they failed to do so. petitioners filed a motion to dismiss the counterclaim on the ground that respondent banks counterclaim was not accompanied by a

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certification against forum shopping.1avvphil.net Respondent bank filed an opposition to the motion, contending that its counterclaim, which is compulsory in nature, is not a complaint or initiatory pleading that requires a certification against forum shopping. RTC issued an Order denying the motion to dismiss the counterclaim for lack of merit. Petitioners filed a Motion for Reconsideration but it was likewise denied by the RTC. Thereafter, petitioners filed with the Court of Appeals a Petition for Certiorari under Rule 65 of the 1997 Rules of Civil Procedure, as amended, alleging that the RTC acted with grave abuse of discretion in holding that respondent banks counterclaim need not be accompanied by a certification against forum shopping. the Court of Appeals affirmed the assailed twin Orders of the RTC denying petitioners motion to dismiss the counterclaim and dismissed the petition. WON the CA gravely abused their discretion in not dismissing respondents counterclaim for lack of a certification against forum shopping? The petition must fail. Section 5, Rule 7 of the 1997 Rules of Civil Procedure, as amended, provides: Sec. 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasijudicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action 4 or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed. the Rule distinctly provides that the required certification against forum shopping is intended to cover an "initiatory pleading," meaning an "incipient application of a party asserting a claim for relief." Certainly, respondent banks Answer with Counterclaim is a responsive pleading, filed merely to counter petitioners complaint that initiates the civil action. In other words, the rule requiring such certification does not contemplate a defendants/respondents claim for relief that is derived only from, or is necessarily connected with, the main action or complaint. In fact, upon failure by the plaintiff to comply with such requirement. Sec. 5 Rule 7 directs the "dismissal of the case without prejudice," not the dismissal of respondents counterclaim. Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions. Cabaluna Korean Technologies Co. Ltd. Vs Hon. Alberto Lerma FACTS: Korea Technologies Co., Ltd. [Korea Tech], a Korean corporation, entered into a contract with Pacific General Steel Manufacturing Corporation [Pacific General], a domestic corporation, whereby Korea Tech undertook to ship and install in Pacific

Generals site in Carmona, Cavite the machinery and facilities necessary for manufacturing LPG cylinders, and to initially operate the plant after it is installed. The plant, after completion of installation, could not be operated by Pacific General due to its financial difficulties affecting the supply of materials.The last payments made by Pacific General to Korea Tech consisted of postdated checks which were dishonored upon presentment. According to Pacific General, it stopped payment because Korea Tech had delivered a hydraulic press which was different in kind and of lower quality than that agreed upon. Korea Tech also failed to deliver equipment parts already paid for by it. It threatened to cancel the contract with Korea Tech and dismantle the Carmona plant.Korea Tech initiated arbitration before the Korea Commercial Arbitration Board [KCAB] in Seoul, Korea and, at the same time, commenced a civil action before the Regional Trial Court [the trial court] where it prayed that Pacific General be restrained from dismantling the plant and equipment.Pacific General opposed the application and argued that the arbitration clause was null and void, being contrary to public policy as it ousts the local court of jurisdiction. It also alleged that Korea Tech was not entitled to the payment of the amount covered by the two checks, and that Korea Tech was liable for damages.

The trial court denied the application for preliminary injunction and declared the arbitration agreement null and void. Korea Tech moved to dismiss the counterclaims for damages. Meanwhile, Pacific General filed a motion for inspection of things to determine whether there was indeed alteration of the quantity and lowering of quality of the machineries and equipment and whether these were properly installed.Korea Tech opposed the motion arguing that these issues were proper for determination in the arbitration proceeding. The court denied the motion to dismiss and granted the motion for inspection of things. The court also directed the Branch Sheriff to proceed with the inspection of the machineries and equipment in the plant. The Branch Sheriff later reported his finding that the enumerated machineries and equipment were not fully and properly installed. Korea Tech filed a petition for certiorari before the Court of Appeals [CA].The court dismissed the petition and held that an arbitration clause which provided for a final determination of the legal rights of the parties to the contract by arbitration was against public policy. WON the counterclaim filed by PGSMC is valid?

The counterclaim of PGSMC were incorporated in its answer with

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representative. ISSUE: WON verification/certification of non-forum shopping was validly executed. HELD: NO. The SC ruled that the certificate of non-forum shopping may be signed, for and on behalf of the corporation, by a specifically authorized lawyer who has personal knowledge of the facts required to be disclosed in such document. This ruling is not applicable in this case at bar, moreover this does not mean that any lawyer acting in behalf of the corporation may routinely sign a certification of non-forum shopping. The SC emphasizes that the lawyer must be specifically authorized in order to validly sign the certification. These powers are exercised through their board of directors and/or duly authorized representatives or agents. Hence physical act can only be done by natural persons duly authorized by specific act of board of directors. There must be a resolution issued by the board of directors that specifically authorizes him to institute the petition and execute the certification. THEREFORE in this case the signing of the counsel of record is without specific authority thus rendered it invalid. 6 Calunod Toyota Motor Philippines Corporation Workers Association vs. CA (Toyota Motors Philippine Corporation) FACTS: Toyota is a domestic corporation engaged in assembly and sales of vehicles parts. On the other hand the UNION is a legitimate labor organization duly registered in the Department of Labor and Employment (DOLE) and is the sole and exclusive bargaining agent of all Toyota and rank and file employees. In 1999, the Union filed a petition for certification election among the Toyota rank and file employees with the NCMB. Med

compulsory counterclaim dated july 17, 1998 in accordance with sec. 8 of rule 11, 1997 rules of civil procedure, the rule that was effective at the time the answer with counterclaim was filed. Sec 8 on existing counterclaim or cross-claim states that a compulsory counterclaim or cross claim that a defending party has at the time he files his answer shall be contained therein. On july 17, 1998 PGSMC was not liable to pay filing fees for said counterclaims being compulsory in nature. However, that became effective August 16, 2004 under sec. 7 rule 141 which provides that docket fees are now required to be paid in compulsory counterclaim or cross claims. as to the failure to submit a certification against forum shopping, the court further held that PGSMCs answer is not an initiatory pleading which requires a certication against forum shopping but a responsive pleading, hence the Court did not commit an error in denying Kogies motion to dismiss 5 Calunod BPI LEASING vs CA G.R. No. 127624 FACTS: BPI Leasing Corporation is engaged in business of leasing properties. For the Calendar year 1986 BLC paid the Commissioner of Internal Revenue a total more than 1M representing 4% of contractors percentage tax. When it recomputed its tax liabilities only amounting to P361K. BLC filed its claim and refund to CIR but was denied. Petitioner filed a petition to CTA, which the CTA denied its petition and dismissed its clam and refund. CTA decided that the new revenue regulation did not cover BLC rental income prior to 1986 cannot be applied retroactively. Moreover, respondents argue that petition should be dismissed on the ground that verification certification of non-forum shopping was signed by the counsel of record, not by BLC through a duly authorized

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Arbiter Lameyra denied the petition but on appeal the DOLE Secretary granted the Union. In the meantime, the Union submitted its collective bargaining proposals to Toyota but the latter refused to negotiate. Union files notice of strike based on Toyotas refusal to bargain. Some of the members failed to render required overtime work and instead marched and staged a picket. Toyota experience acute manpower in its manufacturing and production lines resulting to huge losses. As a result 227 members were dismissed. Union filed for illegal dismissal. NLRC ordered both parties to submit their position papers. However only Toyota submitted position papers. Despite several accommodation the union failed to submit the position paper. The latter claimed it filed its position papers by registered mail. Furthermore, the CA ruled that the Union petition is defective in form for its failure execute a proper verification on nonforum shopping, given that 68 out of 227 petitioners did not sign the certificate. ISSUE(s): (1) WON CA committed an error in affirming NLRCs decision in excluding the Unions position papers. (2) WON there was a valid certificate on non-forum shopping. HELD: (1) NO. The CA did not commit an error in deciding to exclude Unions position paper. The SC ruled that is entirely the Unions fault that the position paper was not considered by the NLRC. Record reveals that NLRC was to generous to afford due process to the Union. It issued 3 orders to the parties to submit position papers which the Union ignored until the last minute. (2) Union is partly correct that is executed a verified petition for non-forum shopping. In this case only 159 out of 227 petitioners executed the verification attesting that they have sufficient knowledge of the truth and correctness of the allegation of the petition. However according to the SC signatures cannot be considered as verification of the petition by the other 68 petitioners unless they gave a written authorization to the 159 employees to sign the verification on their behalf. The SC ruled that the petition satisfies the formal requirements only with regard to the petitioner who signed the petition. 7 III (7) ART FUENTEBELLA, Park-in-Charge, and ROLLING HILLS MEMORIAL PARK, INC. vs. DARLICA CASTRO, G.R. No. 150865, June 30, 2006 Facts: Respondent was the widow of the late Freddie Castro. The former engaged the funeral services of petitioner Rolling Hills Memorial Park for the interment of her husbands remains. During the burial, when the casket of her husband was about to be lowered into the vault, it was discovered that the dimensions of the vault did not correspond to the measurements of the casket. As a result, the casket was lifted and placed under the heat of the sun for about one hour in front of all the mourners while the vault was being prepared. To make matters worse, the employees of petitioner corporation measured the casket by using a spade. Insulted by the events that transpired at the funeral, respondent, through counsel, wrote to the management of petitioner corporation demanding an explanation for its negligence, but the latter did not respond nor attempt to apologize to the former. On March 16, 1998, respondent filed a complaint for damages against the corporation and its Park-in-Charge Art Fuentebella, jointly and solidarily, before the Municipal Trial Court in Cities (MTCC) of Bacolod City asking for moral and exemplary damages,

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attorneys fees and litigation costs. Petitioners filed a motion to dismiss on the ground that the MTCC has no jurisdiction to take cognizance of the case because the amount of damages claimed is more than P200,000. Respondent subsequently filed a motion to withdraw the complaint, which was granted by the MTCC. Respondent then filed a similar complaint with the RTC of Negros Occidental. Petitioners filed a motion to dismiss on the ground that the certification is false because respondent had previously filed an identical complaint with the MTCC. This was eventually denied. A motion for reconsideration was filed by petitioners arguing that the motion to dismiss was not based on the ground that respondent had filed two similar actions at the same time but rather on the submission by the latter of a false certification. The trial court denied said motion in its order dated July 9, 2001. Petitioners filed with the Court of Appeals a petition for certiorari with preliminary injunction and/or restraining order. The petition, however, was dismissed by the Court of Appeals. A motion for reconsideration of the above resolution was filed by petitioner Rolling Hills Memorial Park, Inc. attaching thereto a Secretarys Certificate signed by Monico A. Puentevella, Jr., Corporate Secretary of petitioner corporation, affirming therein the authority of Lourdes A. Pomperada to file the aforementioned petition. Nonetheless, the Court of Appeals denied said motion in its challenged resolution. Issue: Whether or not there is compliance on the procedural requirement on the certification of non-forum shopping? or Whether the court exercised grave abuse of discretion in denying the MR violation of the non-forum shopping requirement? Ruling: First Issue: SC stated that it is obligatory that the one signing the verification and certification against forum shopping on behalf of the principal party or the other petitioners has the authority to do the same. The Rules on Civil Procedure mandates that the petitioner or the principal party must execute the certification against forum shopping. The reason for this is that the principal party has actual knowledge whether a petition has previously been filed involving the same case or substantially the same issues. If, for any reason, the principal party cannot sign the petition, the one signing on his behalf must have been duly authorized. This requirement is intended to apply to both natural and juridical persons as Supreme Court Circular No. 28-91 and Section 5, Rule 7 of the Rules of Court do not make a distinction between natural and juridical persons. Where the petitioner is a corporation, the certification against forum shopping should be signed by its duly authorized director or representative. This was enunciated in Eslaban, Jr. v. Vda. de Onorio, where the Court held that if the real party-in-interest is a corporate body, an officer of the corporation can sign the certification against forum shopping so long as he has been duly authorized by a resolution of its board of directors. Likewise, where there are several petitioners, it is insufficient that only one of them executes the certification, absent a showing that he was so authorized by the others. That certification requires personal knowledge and it cannot be presumed that the signatory knew that his co-petitioners had the same or similar actions filed or pending. Hence, a certification which had been signed without the proper authorization is defective and constitutes a valid cause for the dismissal of the petition. This holds true in the present case where the Court of Appeals accordingly dismissed the petition for lack of proper authorization of the one signing it on behalf of petitioners. Lourdes Pomperada, the Administrative Manager of petitioner corporation, who signed the verification and certificate on non-forum shopping, initially failed to submit a secretarys certificate or a board resolution confirming her authority to sign for the corporation, and a special power of attorney to sign on behalf of co-petitioner Art Fuentebella, who was sued jointly and solidarily with the corporation in his capacity as officer of the latter.

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Ruling: YES. Section 5 of Rule 7 of the Rules of Court provides that "if the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be a ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions." The fact that Meycauayan did mention in its certification of non-forum shopping its attempt to intervene in G.R. No. 118436, which this Court denied, does not negate the existence of forum shopping. This disclosure does not exculpate Meycauayan for deliberately seeking a friendlier forum for its case and re-litigating an issue which this Court had already decided with finality. Meycauayan and its Executive Vice President Juan M. Lamson, Jr. were found guilty of direct contempt for forum shopping. 9 SPOUSES MARCIAL VARGAS and ELIZABETH VARGAS, petitioners, vs. SPOUSES VISITACION and JOSE CAMINAS, SPOUSES JESUS and LORELEI GARCIA, and SPOUSES RODOLFO and ROSARIO ANGELES DE GUZMAN, respondents. FACTS: Spouses Jose and Visitacion Caminas bought a 54square meter lot with a two-storey townhouse, designated as townhouse No. 8, from Trans-American Sales and Exposition represented by its developer Jesus Garcia. Spouses Caminas paid Garcia P850, 000 as evidenced by a contract of sale and provisional receipt. According to spouses Caminas, they took possession of townhouse No. 8 upon completion of its construction. In December of 1988, Garcia bought from Marcial and Elizabeth Vargas various construction materials. As payment to spouses Vargas, Garcia executed an absolute Deed of Sale over townhouse No. 12.However, spouses Vargas and Garcia executed a Deed of Exchange with Addendum whereby spouses Vargas transferred to Garcia townhouse No. 12, and in exchange Garcia transferred to spouses Vargas townhouse No. 8. The contracts executed by Garcia with spouses Caminas and spouses Vargas were not registered with the Register of Deeds. This was because TCT No. 195187 was still being reconstituted and it was only on 17 August 1989 that TCT No. 7285 was issued in its stead. On 10 May 1990, Garcia and his wife Lorelei executed a Deed of Real Estate Mortgage over townhouse No. 8 in favor of spouses Rodolfo and Rosario Angeles De Guzman as security for a loan.

Second issue: The High Court disagreed with the petitioners claim that respondents failure to disclose that a similar case was earlier filed by her before the MTCC but was later withdrawn for lack of jurisdiction constituted false certification. They contend that the trial court committed grave abuse of discretion when it did not dismiss the petition for this reason. The SC held that an omission in the certificate of non-forum shopping about any event that would not constitute res judicata and litis pendentia, as in the present case, is not fatal as to merit the dismissal and nullification of the entire proceedings considering that the evils sought to be prevented by the said certificate are not present. Hence, in any event, the trial court correctly held that the submission of a false certification shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal sanctions. This is in accordance with Section 5, Rule 7 of the Rules of Court. PETITION DENIED. 8 III-(8) HEIRS OF TRINIDAD DE LEON VDA. DE ROXAS vs. CA et al. G.R. No. 138660 February 5, 2004 CARPIO, J.: Facts: On 22 May 1997, Meycauayan Central Realty Corporation (Meycauayan) filed with the Supreme Court a petition for intervention in G.R. No. 118436. Meycauayan alleged that it was a purchaser in good faith and for value of three (3) parcels of land from Maguesun Management & Development Corporation (Maguesun), which happened to actually form part of the property awarded to the heirs of Trinidad de Leon Vda. De Roxas (Roxas heirs). The petition was denied, and this decision in G.R. No. 118436 became final and executory. On April 20, 1999, Meycauayan still filed a complaint for reconveyance, damages and quieting of title with the trial court. The complaint was almost an exact reproduction of the petition for intervention filed by Meycauayan before the Supreme Court. Issue: Whether or not forum shopping was committed

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As spouses Garcia failed to pay their indebtedness, spouses De Guzman foreclosed the mortgage. At the public auction, spouses De Guzman were the highest bidder. Spouses Caminas filed a complaint against spouses Garcia, spouses De Guzman, and spouses Vargas before the RTC of Quezon City, for the declaration of nullity of deed of mortgage and deed of sale, for the declaration of absolute ownership, for the delivery of title. Spouses Vargas filed a case against spouse Garcia and spouses De Guzman, also before the RTC of Quezon City, for specific performance, declaration of nullity of the mortgage contract, damages. The two cases were consolidated. In their Rejoinder, Spouses Vargas raised the lack of jurisdiction of the trial court on the ground that the subject matter falls within the exclusive jurisdiction of the Housing and Land Use Regulatory Board (HLURB). The trial court rendered a decision upholding the rights of the spouses Caminas as the first buyer of the property. Spouses De Guzman filed a Motion for Reconsideration. The trial court granted the motion for reconsideration and issued an order this time awarding ownership of the property to spouses De Guzman. Spouses Caminas and spouses Vargas filed an appeal before the Court of Appeals. Court of Appeals set aside the order of the trial court dated 10 February 1994. The appellate court reinstated the trial court's original decision dated 20 April 1993 upholding the ownership of spouses Caminas. Hence, this appeal. ISSUE: Whether the Court of Appeals committed reversible error in not setting aside the decision and order of the Regional Trial Court since the case is within the exclusive jurisdiction of the HLURB? RULING: Presidential Decree No. 1344 dated 2 April 1978 expanded the jurisdiction of the National Housing Authority (NHA), the precursor of the HLURB, to include adjudication of the following cases: 10

Sec.1. In the exercise of its function to regulate the real estate trade and business and in addition to its powers provided for in Presidential Decree No. 957, the National Housing Authority shall have exclusive jurisdiction to hear and decide cases of the following nature: A. Unsound real estate business practices; B. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project owner, developer, dealer, broker or salesman; and C. Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lot or condominium unit against the owner, developer, broker or salesman. Executive Order No. 648 created the Human Settlements Regulatory Commission (HSRC) to assume the regulatory and adjudicatory functions of the NHA, among other purposes. Executive Order No. 90 later renamed the HSRC the HLURB. The HLURB has jurisdiction over cases arising from (1) unsound real estate business practices; (2) claims for refund or other claims filed by subdivision lot or condominium unit buyers against the project owner, developer, dealer, broker or salesman; and (3) demands for specific performance of contractual and statutory obligations filed by buyers of subdivision lots or condominium units against the owner, developer, broker, or salesman. There is no dispute that spouses Garcia are in the real estate business under the name Trans-American Sales and Exposition and that townhouse No. 8 is part of its Trans-American Sales and Exposition II project. Clearly, the validity of the questioned transactions entered into by spouses Garcia, as the owner and developer of Trans-American Sales and Exposition, falls within the jurisdiction of the HLURB. SPOUSES VICTOR ONG and GRACE TIU ONG, petitioners, vs. COURT OF APPEALS, HON. RODOLFO R. BONIFACIO in his capacity as Presiding Judge, RTC, Pasig City, Branch 159; PROVINCIAL SHERIFF OF RIZAL GRACE S. BELVIS; DEPUTY

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SHERIFF VICTOR S. STA. ANA; and PREMIERE DEVELOPMENT BANK, respondents. FACTS: Petitioners are the mortgagors of an 857 square meter lot and residential house in San Juan, Metro Manila. The real estate mortgage was used to secure a promissory note issued by Kenlene Laboratories, Inc. a domestic corporation, in favor of private respondent Premiere Development Bank. Upon failure of the debtor company to pay its amortizations, the mortgagee-bank extrajudicially foreclosed the real estate mortgage under the provisions of Act 3135, as amended by Act 4118. The mortgageebank was the highest bidder. During the one-year redemption period, the mortgagee filed a petition with the RTC of Pasig City for the issuance of a writ of possession. Upon the filing of a bond, the trial court issued the writ of possession. Petitioners filed a Motion for Reconsideration and to Recall Writ of Possession, which was denied by the trial court. Petitioners-mortgagors filed with the Court of Appeals a petition for prohibition with an application for a writ of preliminary mandatory injunction to enjoin the implementation of the writ of possession. Petitioners alleged that there is a pending case for annulment of extrajudicial foreclosure of real estate mortgage with an application for preliminary injunction and temporary restraining order (TRO), with the RTC of Pasig. Petitioners argued that the implementation of the writ of possession would render nugatory the judgment of the trial court in Civil Case No. 64604. Initially, the CA granted the TRO, but later dismissed the petition for prohibition for lack of merit it likewise denied petitioner's Motion for Reconsideration. Hence, the present petition for review on certiorari. ISSUE: (1) Whether or not prohibition lies to enjoin the issuance of a writ of possession? (2) Whether or not petitioners are guilty of forum shopping? RULING: A writ of possession is "a writ of execution employed to enforce a judgment to recover the possession of land. It commands the sheriff to enter the land and give possession of it to the person entitled under the judgment. A writ of possession may be issued under the following instances: (1) land registration proceedings under Sec. 17 of Act 496; (2) judicial foreclosure, provided the debtor is in possession of the mortgaged realty and no third person, not a party to the foreclosure suit, had intervened; and (3) extrajudicial foreclosure of a real estate mortgage under Sec. 7 of Act 3135 as amended by Act 4118. The present case falls under the third instance. Under Sec. 7 of Act 3135 as amended by Act 4118, a writ of possession may be issued either (1) within the one year redemption period, upon the filing of a bond, or (2) after the lapse of the redemption period, without need of a bond. In case it is disputed that there was violation of the mortgage or that the procedural requirements for the foreclosure sale were not followed, Sec. 8 of Act 3135 as amended by Act 4118, provides that the mortgagor may file a petition with the trial court which issued the writ to set aside the sale and for cancellation of the writ of possession within 30 days after the purchaser-mortgagee was given possession. In several cases, the Court has ruled that the issuance of a writ of possession is a ministerial function. "The order for a writ of possession issues as a matter of course upon the filing of the proper motion and the approval of the corresponding bond. The judge issuing the order following these express provisions of law cannot be charged with having acted without jurisdiction or with grave abuse of discretion." Therefore, the issuance of the writ of possession being ministerial in character, the implementation of such writ by the sheriff is likewise ministerial. The foregoing considered, the petition for review on certiorari assailing the dismissal of the petition for prohibition must fail. Under Section 2 of Rule 65 of the Rules of Court, prohibition can only be availed of if there is no appeal, or any other plain, speedy, adequate remedy in the ordinary course of law. In this case, appeal under Sec. 8 of Act 3135, as amended by Act 4118, is still available. Further, petitioners have a plain, speedy and adequate remedy in the ordinary course of law, which is their separate case for annulment of the foreclosure of mortgage. Prohibition does not lie to enjoin the implementation of a writ of

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possession. With regard to the second issue, it will be recalled that the essence of forum-shopping is the filing of multiple suits involving the same parties for the same cause of action, either simultaneously or successively, for the purpose of obtaining favorable judgment. It exists where the elements of litis pendentia are present or where a final judgment in one case will amount to res judicata in another. The issuance of the writ of possession being a ministerial function, and summary in nature, it cannot be said to be a judgment on the merits, but simply an incident in the transfer of title. Hence, a separate case for annulment of mortgage and foreclosure sale cannot be barred by litis pendentia or res judicata. Clearly, insofar as LRC Case No. R-4874 and Civil Case No. 64604 pending before different RTCs are concerned, there is no forum shopping. 11 12 13 Dino Dino Multi-Realty Development Corporation v. Makati Tuscany Condominium Corporation Facts: The petitioner Multi-Realty constructed condominium known as the Makati Tuscany Condominium Building. In pursuant to RA 4726, respondent Makati Tuscany Condominium Corporation (Matusco) was organized and established to manage the condominium units. In 1975, Multi-Realty executed a Master Deed and Declaration of Restriction of the Makati Tuscany, which did not specify the ownership of the 98 parking slots. In 1989, Multi-Realty requested that two of its executives be allowed to park their cars in two of Makati Tuscanys remaining 72 unallocated parking slots but Matusco denied the request. Then, Matusco sent a letter offering Multi-Realty for the use of the two unallocated parking slots which the latter rejected. On April 1990, petitioner filed a complaint against Matusco for Damages and or Reformation of Instrument with prayer for temporary restraining order and or preliminary injunction with the Makati RTC. Petitioner alleged that it had retained ownership of the 98 unassigned parking slots but it was not specified in the Master Deed and that the mistake was discovered for the first time when Matusco Rejected its request. In its answer with counterclaim, Matusco alleged that Multi-Realty had no cause of action against it for reformation of their contract. The RTC dismissed the case and ruled that Multi-Realty failed to prove any ground for the reformation of its agreement with Matusco. Multi-Realty appealed the decision to the CA contending that Reformation is proper because the deed failed to express the true agreement or intention of the parties. It alleged that Matusco knew that petitioner owned the 98 parking slots and Matusco never objected the sale of the slots to third parties. Matusco was also stopped from assailing the ownership over the parking slots. Petitioner also averred that Matuscos counterclaim had already prescribed because it was filed only in 1990 when the period therefor had elapsed in 1981. Whereas, Matusco contended that if there was a mistake in the drafting of the master Deed in 1975, it should have been corrected in 1977 upon the execution of the Deed of Transfer. Matusco alleged that it was not stopped from claiming ownership over the slots because Multi-Realty acted fraudulently and illegally. The CA rendered its decision dismissing Multi-Realtys appeal on the ground that its action had already prescribed. The CA denied the MR filed by petitioner. Hence this petition. Issues: Whether the CA erred in dismissing petitioners appeal on the ground of prescription Whether petitioners action had already prescribed when it was filed in 1990 Ruling: 1) The CA erred in dismissing petitioners appeal. Settled is the rule that no questions will be entertained on appeal unless they have been raised below. Points of law, theories, issues and arguments not adequately brought to the attention of the lower court need not be considered by the reviewing court as they cannot be raised for the first time on appeal. In the case at bar, neither petitioner nor respondent raised the issue of prescription throughout the proceedings in the RTC, hence the appellate court should have proceeded to resolve petitioners appeal on its merits instead of dismissing the same on a ground not raised by the parties in the RTC and even in their pleadings in the CA. 2) Prescription is rightly regarded as a statute of repose whose object is to suppress fraudulent and stale claims from springing up at great distances of time and surprising the parties or their

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representatives when the facts have become obscure from the lapse of time or the defective memory or death or removal of witnesses. The essence of the statute of limitations is to prevent fraudulent claims arising from unwarranted length of time and not to defeat actions asserted on the honest belief that they were sufficiently submitted for judicial determination. Article 1144 of the New Civil Code provides that an action upon a written contract must be brought within ten (10) years from the time the right of action accrues. In relation thereto, Article 1150 of the New Civil Code provides that the time for prescription of all actions, when there is no special provision which ordains otherwise, shall be counted from the day they may be brought. It is the legal possibility of bringing the action that determines the starting point for the computation of the period of prescription. The term "right of action" is the right to commence and maintain an action. In the law of pleadings, right of action is distinguished from a cause of action in that the former is a remedial right belonging to some persons while the latter is a formal statement of the operational facts that give rise to such remedial right. The former is a matter of right and depends on the substantive law while the latter is a matter of statute and is governed by the law of procedure. The right of action springs from the cause of action, but does not accrue until all the facts which constitute the cause of action have occurred. A cause of action must always consist of two elements: (1) the plaintiffs primary right and the defendants corresponding primary duty, whatever may be the subject to which they relate person, character, property or contract; and (2) the delict or wrongful act or omission of the defendant, by which the primary right and duty have been violated. To determine when all the facts which constitute a cause of action for reformation of an instrument may be brought and when the right of the petitioner to file such action accrues, the second paragraph of Section 1, Rule 63, must be considered because an action for the reformation of an instrument may be brought under said Rule: SECTION 1. Who may file petition. Any person interested under a deed, will, contract or other written instrument, whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to determine any question of construction or validity arising, and for a declaration of his rights or duties, thereunder. An action for the reformation of an instrument, to quiet title to real property or remove clouds therefrom, or to consolidate ownership under Article 1607 of the Civil Code, may be brought under this Rule. The concept and meaning of the term cause of action in proceedings for declaratory relief, vis--vis an ordinary civil action, is broadened. It is not, as in ordinary civil action, the wrong or delict by which the plaintiffs rights are violated, but it is extended to a mere denial, refusal or challenge raising at least an uncertainty or insecurity which is injurious to plaintiffs rights. For a petition for declaratory relief to prosper, the following conditions sine qua non must concur: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; and (4) the issue involved must be ripe for judicial determination. To controvert is to dispute; to deny, to oppose or contest; to take issue on. The controversy must be definite and concrete, touching on the legal relations of the parties having adverse legal interests. It must be a real and substantial controversy admitting of specific relief through a decree of a conclusive character as distinguished from an opinion advising what the law would be upon a hypothetical state of facts. In sum, one has a right of action to file a complaint/petition for reformation of an instrument when his legal right is denied, challenged or refused by another; or when there is an antagonistic assertion of his legal right and the denial thereof by another concerning a real question or issue; when there is a real, definitive and substantive controversy between the parties touching on their legal relations having adverse legal interests. This may occur shortly after the execution of the instrument or much later. A party to an instrument is under no obligation to seek a reformation of an instrument while he is unaware that any opposition will be made to carry out the actual agreement. The statute of limitations does not begin to run against an equitable cause of action for the reformation of an instrument because of mistake until the mistake has been discovered or ought to have been discovered. The mere recording of a deed does not charge the grantor with constructive notice of a mistake therein, but is to be considered with other facts and circumstances in determining

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whether the grantor be charged with notice actual or constructive. In the case at bar, Petitioner only discovered the error in 1989, hence he is not prescribed or still has a right of action against respondent in the reformation of the instrument. When he filed the complaint in 1990, the prescriptive period had not yet elapsed. 14 Bacolod-Murcia Milling Co., Inc. vs. First farmers Milling Co., Inc Etc Facts: Plaintiff filed an action for injunction and prohibition with damages against defendants first farmers milling co., and other planters for illegal transfer of quota. The parties filed their respective answers and a Motion to admit Amended and Supplemental Complaint was filed by plaintiff to include PNB and NIDC as new defendants. According to First Farmers, PNB and NIDC are necessary parties because they are creditors of First Farmers. PNB and NIDC answered that they have no participation in the alleged illegal transaction and that the granting of loans did not violate any rights of the plaintiff. The trial court dismissed the Amended and Supplemental Complaint against the PNB and NIDC after a preliminary hearing on the ground of lack of cause of action. Hence this petition. Issue: Whether the allegations of the amended and supplemental complain constituted a sufficient cause of action against PNB and NIDC. Ruling: It is basic that the complaint must contain a concise statement of the ultimate facts constituting the plaintiffs cause of action. Ultimate facts are the important and substantial facts which either directly form and basis of the plaintiffs primary right and duty, or directly make up the wrongful acts or omissions by the defendant. When the ground for dismissal is that the Complaint states no cause of action, the rule is that its sufficiency can only be determined by considering the facts alleged in the Complaint and no other. The court may not consider other matters outside of the Complaint. Defenses averred by the defendant are not to be taken into consideration in ruling on the motion. The allegations in the Complaint must be accepted as true and it is not permissible to go beyond and outside of them for date or facts. And the test of sufficiency of the facts alleged is whether or not the Court could render a valid judgment as prayed for accepting as true the exclusive facts set forth in the Complaint. The subject Amended and Supplemental Complaint fails to meet the test. It should be noted that it charges PNB and NIDC with having assisted in the illegal creation and operation of defendant sugar mill. Granting, for the sake of argument, that, indeed, assistance in the "illegal" act was rendered, the same, however, is not supported by well-pleaded averments of facts. Nowhere is it alleged that defendants-appellees had notice, information or knowledge of any flaw, much less any illegality, in their co-defendants' actuations, assuming that there was such a flaw or illegality. This absence is fatal and buoy-up instead the PNB-NIDC's position of lack of cause of action. Although it is averred that the defendants' acts were done in bad faith, the Complaint does not contain any averment of facts showing that the acts were done in the manner alleged. Such a bare statement neither establishes any right or cause of action on the part of the plaintiff-appellant. It is a mere conclusion of law not sustained by declarations of facts, much less admitted by defendants-appellees. It does not, therefore, aid in any wise the complaint in setting forth a cause of action. Defendants-appellees are not fairly apprised of the act or acts complained of. While it is a settled rule that a defective complaint may be cured by the introduction of sufficient evidence so as to constitute the cause of action which the plaintiff intended to set forth in the complaint, the same merits the Court's blessings only and unless there is no objection or opposition from the side of the defendant. It is obvious that the defendants-appellees, in the case at bar, were vigilant of their right and were on their guard from the very initiation of the complaint against them. 15 CASE 15 - Javier, Karen O. PHILIPPINE NATIONAL BANK, petitioner, vs. HONORABLE COURT OF APPEALS, and ATTY. MORDENO CUA, respondents. A petition for review on certiorari under Rule 45 of the Rules of Court. FACTS:

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Petitioner filed a complaint against the private respondent with the Regional Trial Court, Cagayan de Oro City, Branch 24, alleging that sometime on December 18, 1985, the PNB thru its Cable Division received a tested message from Manufacturers Hanover Trust Co., New York (Mantrust) to remit proceeds in the amount $14,056.25 to Philippine National Bank, Cagayan de Oro Branch under Account No. 16087. This message was implemented on December 20, 1985 in the Peso Conversion rate of P262,793.04. On December 26, 1985, after a thorough but futile search for Cagayan de Oro Branch for Account No. 16087, PNB Manila was notified that the account was not carried or maintained by Cagayan de Oro. With this Notice, it was later discovered that said Account No. 16087 was carried with PCI Bank Cagayan de Oro in the name of CENTER FOR ECONOMIC AND SOCIAL STUDIES (CESS) with the Defendant Mordeno Cua as the sole signatory. The PNB Cagayan de Oro Branch transferred and delivered the amount of $14,056.25 to Account No. 16087 with the PCI Bank, Cagayan de Oro Branch and funds were withdrawn by the defendant Mordeno Cua. About the same time of the transfer and delivery, to the PCI Bank Cagayan de Oro Branch, Mantrust rectified their tested message and recalled the fund stating that the money was not intended for PNB. This recall Order was complied by PNB on January 21, 1986 thru telex message sent to Mantrust, New York. Upon request for PCI Bank Cagayan de Oro to return the amount thus transferred and delivered, the PNB was informed that the whole amount was already withdrawn by Mordeno Cua, the sole signatory for the Center for Economic and Social Studies. Thereafter, requests both verbal and written were made upon the defendant Mordeno Cua to restitute the amount of $14,056.25 but all efforts failed as Mordeno Cua refused and continue to refuse to restitute or make necessary arrangement for the restitution. In his Answer to the complaint, the private respondent, as defendant, admitted to being the sole signatory to the account of the CESS with PCIB Cagayan de Oro Branch. He, however, alleged that the petitioner had no causes of action against him, and that he had no knowledge sufficient to form a belief as to the truth of the allegations alleged in paragraphs 2, 3, 5, 7, 8, and 9 of the complaint, the truth being that with reference to paragraph 4 thereof, he never withdrew money from PCIB from the fund transfer of the petitioner nor was he notified of the said fund transfer to the account of CESS with the PCIB. The private respondent interposed counterclaims for damages against the petitioner. The RTC ruled in favor of the Petitioner. CA reversed TCs decision. ISSUE: WON the CA erred in concluding that petitioner failed to adduce sufficient evidence to porve the material allegations of the complaint HELD: The petitioners contention has no merit. Rule 8, Section 10 of the Rules of Court, as amended, require a defendant to specify each material allegations of fact, the truth of which he does not admit, and whenever practicable, to set forth the substance of the matters upon which he relies to support his denial. Where a defendant desires to deny part of an averment for a qualification thereof, he is mandated to specify so much of the averment as true and material and shall deny the remainder. A denial is not specific simply because it is so qualified by the defendant. A general denial does not become specific by the use of the word "specifically." When the matters of whether the defendant alleges having no knowledge or information sufficient to form a belief, are plainly and necessarily within the defendants knowledge, his alleged ignorance or lack of information will not be considered as a specific denial. Further, Section 11, Rule 8 of the said Rule, provides that material averments in the complaint other than those as to the amount of unliquidated damages shall be deemed admitted when not specifically denied. The private respondents admissions/denials in his Answer to the complaint should be considered in their entirety and not truncated parts. In sum then, the petitioner was able to prove that, indeed, the US$14,056.25 was remitted to PCIB Account No. 16087 under the name of CESS with the private respondent as the depositors sole signatory. However, the petitioner failed to prove that the private respondent withdrew the amount from the said account. We agree with the private respondents contention that the petitioner was burdened to prove not only that the amount was remitted to Account No. 16087, but also that the private respondent withdrew the same in his capacity as the sole signatory of the owner of the account. 16 CASE 16- Javier, Karen O.

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UNITED AIRLINES, INC., Petitioner vs. FONTANILLA, et al. FACTS: On March 1, 1989, private respondent Aniceto Fontanilla purchased from petitioner United Airlines, through the Philippine Travel Bureau in Manila three (3) "Visit the U.S.A." tickets for himself, his wife and his minor son Mychal for the following routes: SF to Washinton - Washington to Chicago -c. Chicago to LA LA to SF. All flights had been confirmed previously by United Airlines. They proceeded to the United States as planned, where they used the first coupon from San Francisco to Washington. On April 24, 1989, Aniceto Fontanilla bought two (2) additional coupons each for himself, his wife and his son from petitioner at its office in Washington Dulles Airport. After paying the penalty for rewriting their tickets, the Fontanillas were issued tickets with corresponding boarding passes with the words "CHECK-IN REQUIRED," for United Airlines Flight No. 1108, set to leave from Los Angeles to San Francisco at 10:30 a.m. on May 5, 1989. The cause of the non-boarding of the Fontanillas on United Airlines Flight No. 1108 makes up the bone of contention of this controversy. The same prompted the Fontanillas to file Civil Case for damages before the Regional Trial Court of Makati. After trial on the merits, the trial court rendered a decision, dismissing the complaint. On appeal, the Court of Appeals ruled in favor of the Fontanillas. The appellate court found that there was an admission on the part of United Airlines that the Fontanillas did in fact observe the checkin requirement. It ruled further that even assuming there was a failure to observe the check-in requirement, United Airlines failed to comply with the procedure laid down in cases where a passenger is denied boarding. Hence, petitioner now comes to this Court via a petition on certiorari. ISSUE: WON the CA erred in reversing the ruling of the TC on the ground that TC was wrong in failing to consider the alleged admission that resp observed the check-in requirement HELD: We disagree with the conclusion reached by respondent Court of Appeals. Paragraph 7 of private respondents complaint states: 7. On May 5, 1989 at 9:45 a.m., plaintiff and his son checked in at defendants designated counter at the airport in Los Angeles for their scheduled flight to San Francisco on defendants Flight No. 1108. Responding to the above allegations, petitioner averred in paragraph 4 of its answer, thus: 4. Admits the allegation set forth in paragraph 7 of the complaint except to deny that plaintiff and his son checked in at 9:45 a.m., for lack of knowledge or information at this point in time as to the truth thereof. The rule authorizing an answer that the defendant has no knowledge or information sufficient to form a belief as to the truth of an averment giving such answer is asserted is so plainly and necessarily within the defendants knowledge that his averment of ignorance must be palpably untrue. Whether or not private respondents checked in at petitioners designated counter at the airport at 9:45 a.m. on May 5, 1989 must necessarily be within petitioners knowledge. While there was no specific denial as to the fact of compliance with the "check-in" requirement by private respondents, petitioner presented evidence to support its contention that there indeed was no compliance. Private respondents then are said to have waived the rule on admission. It not only presented evidence to support its contention that there was compliance with the check-in requirement, it even allowed petitioner to present rebuttal evidence. Civil Procedure: The general rule in civil cases is that the party having the burden of proof of an essential fact must produce a preponderance of evidence there on; although plaintiffs evidence is stronger than that presented by the defendant a judgment cannot be entered in favor of the former if his evidence is not sufficient to sustain his cause of action. The plaintiff must rely on the strength of his own evidence and not upon the weakness of the defendants. Kansi kansi Home Insurance Co. v. Eastern Shipping Lines; Home Insurance Co. v. Lijnen *This is a consolidated petition for review on ceriorari on CFI Manila

17 18 19

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already acquired the necessary license to conduct their business in the Philippines. It could already file suits. Insofar as litigation is concerned, foreign corporations may not maintain any suit for the recovery of any debt, claim or demand whatsoever, unless they procure the necessary licenses. However, the objective of the law is to subject the foreign corporations to the jurisdiction of the court. The lack of capacity to sue at the time of the execution of the of the execution of the contracts was cured by subsequent registration is also strengthened by the procedural aspects of these cases. General denials ar inadequate to attack the foreign corporations lack of capacity to sue. Sec 4, Rule 8 of the Rules of Court states that "A party desiring to raise an issue as to the legal existence of any party or the capacity of any party to sue or be sued in a representative capacity, shall do so by specific denial, which shall include such supporting particulars as are peculiarly within the pleader's knowledge." PETITION GARNTED: Respondents are ordered to pay petitioner 20 Sps. Lydia and Virgilio Meliton v. Court of Appeals and Nelia Ziga FACTS: 1. On June 22, 1988; Nelia Ziga, filed a complaint against Lydia Meliton, lessee, for the rescission of the contract of lease over a parcel of land situated at Elias Angeles St. Naga City; 2. The rescission is based on the ground that the sps. Meliton failed to comply with the stipulations stated in the contract of lease; 3. On July 29, 1988, Meliton denied the allegations and set up a counterclaim for the kitchenette demolished by the respondent lessor, including moral damages and litigation expenses; 4. On May 29, 1989, the RTC dismissed the complaint of the respondent, upon the motion of the same because the case

FACTS: 1. Two shipments: first, on December 22, 1966 - 30 packages of service parts for farm equipment; and second, on January 13, 1967 - Copper Wire Rods; were insured by Home Insurance Co. 2. Upon the delivery of these shipments, some of them are either in bad order or missing. 3. For those losses suffered by the cargos, Home Insurance Co. paid the consignees/owners of these shipments; 4. Home Insurance Co. demanded payment to the respondents (Eastern and Lijnen) but both refused to pay; 5. Home insurance Co. filed a complaint for recovery of maritime damages; 6. Respondents deny the allegations contending thae Home Insurance Co. has no capacity to sue because at the time the insurance contact was executed, they were doing business in the Philippines without a license; 7. The respondents also allege that contacts executed by a foreign corporation without capacity to sue ins null and void; 8. Petitioner contends thatthey are duly authorized to do business and acquired a license dated July 1, 1967 at the time they filed a complaint. ISSUE: 1. Whether or not Home Insurance Co. has the capacity to sue. RULING: There is no question that the respondents has the obligation to pay the petitioner and when the two cases were filed the petitioner has

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became moot and academic by the expiration of the contract of lease; 5. The counterclaims by the petitioner were also dismissed for nonpayment of docket fees, therefore not acquiring jurisdiction over the counterclaim; 6. On December 6, 1989, sps. Meliton filed a complaint with the same amounts involved in their previous counterclaim which was now docketed and later assigned to the same court; 7. The private respondent filed a motion to dismiss on the ground that the cause of action was barred by prior judgment; ISSUE: 1. Whether or not the petitioners are already barred from asserting said claims in a seperate suit, with the same having been dismissed in the preceeding one? RULING: No. As stated in Sec. 4 Rule 9 Rules of Court, that a counterclaim not set up shall be barred if it arises out of or is necessarily connected with the transactions or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication, the presence of the third parties of whom cannot acquire jurisdiction. However, the said rule is not applicable in this case. Petitioner's claims were set up as counterclaims in the prior case but the same were dismissed by reason of non payment of docket fees. In order a prior judgment will constitute a bar to a subsequent case, the following requisites must concur: 1. The judgment must be final; 2. The judgment must be rendered by a court having jurisdiction over the subject matter and the parties; 3. The judgment must be on the merits; 4. There must be between the first and second actions, identity of parties, of subject matter and of cause of action.

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CARLO A. TAN V KAAKBAY FINANCE CORPORATION Facts: Petitioner acquired a loan from respondent corporation for the amount of 4 million secured by a real estate mortgage of a land situated in Calamba Laguna. Petitioner alleged that the stipulated interest was 12% per annum which amount however was not stated in the mortgage when he signed it. Petitioner defaulted on his payment and asked respondent for an extension of time to pay which was granted by the latter. The extension is conditioned upon the petitioner signing a deed of sale under pacto de retro upon expiration of the period. Later on, petitioner learned that Kaakbay was charging him usurious rates of interest when he obtained a statement of account stating that his obligation had now reached P13, 333,750. Likewise, he learned of the existence of an accomplished deed of sale under pacto de retro bearing his and his wifes signature and notarized by private respondents counsel, when in truth he and his wife did not sign such document. This prompted the petitioner to file a complaint for declaration of nullity, invalidity and unenforceability or annulment of the promissory notes purportedly attached to the real estate mortgage and the deed of sale under pacto de retro and damages with prayer for preliminary injunction and/or TRO against respondents. Respondents through their counsel Atty. Noynay filed their consolidated answer with compulsory counterclaims and opposition to TRO and Preliminary injunction. Later, the law firm of Ortega, del Castillo, Bacorro, Odulio, Calma and Carbonell entered its appearance as counsel for respondents. They moved for the withdrawal of the consolidated answer filed by atty. Noynay and in turn filed their answer with counterclaim and a motion for admission of counterclaim without payment of fees, on the ground that their counterclaim is compulsory in nature, hence it may be admitted without payment of fees. Issue: Whether respondents counterclaim is compulsory of permissive in

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nature. Ruling: Counterclaim is compulsory where 1. It arises out of, or is necessarily connected with the transaction or occurrence that is the subject matter of the opposing partys claim; 2. It does not require the presence of third parties of whom the court cannot acquire jurisdiction; 3. Trial court has jurisdiction to entertain the claim. To determine whether a counterclaim is compulsory or not, we have devised the following tests: 1. Are the issues of fact or law raised by the claim and the counterclaim largely the same? 2. Would res judicata bar a subsequent suit on defendants claims absent the compulsory counterclaim rule? 3. Will substantially the same evidence support or refute plaintiffs claim as well as the defendants claim? And 4. Is there any logical relation between the claim and the counterclaim? In quintanilla v CA we said a compelling test of compulsoriness is whether there is a logical relationship between the claim and counterclaim, that is, where conducting separate trials of the respective claims of the parties would entail a substantial duplication of effort and time by the parties and the court? As aptly held by the CA, the issues of fact and law raised by both the claim and counterclaimare largely the same, with a logical relation, considering that the two claims arose out of the same circumstances, requiring substantially the same evidence. Any decision that the trial court will make in favor of the petitioner will necessarily impinge on the claim of respondents and vice versa. In this light, considering that the counterclaims of respondents are compulsory in nature, payment of docket fees is not required. 22 HEIRS OF MARCELINO PAGOBO VS. CA FACTS: On October 12, 1990 Plaintiffs Alfanso Pagobi, et al, filed a complaint for Declaration of Nullity of Documents, Reconveyances with Right of Legal Redemption, Damages and Attorneys Fees against defendants Gabriel Banez et al before the RTC to which an answer was filed by said defendants. On February 21, 1994, plaintiffs filed a motion to admit amended complaint for Partition, Declaration of Nullity of Documents, Cancellation of Transfer Certificates of Titles, Reconveyance with Right of Legal Redemption, Damages and Attorneys Fees and Other Reliefs. Defendants filed their opposition stating among others, that the amended complaint violated Section 3 of the Rules of Court by substantially altering the original cause of action. Thereafter, respondent issued an order denying the motion to admit amended complaint and consequently, the motion for reconsideration filed by the plaintiff. Plaintiffs then filed an Omnibus Motion praying that the Orders issued by the respondent court be considered and the motion to admit the amended complaint be granted but the same was also denied by the RTC. On appeal, the CA ruled that the trial court was correct in not admitting the amended complaint. The CA concluded that the amendment in the case introduced new issues and materially altered the ground of relief. ISSUE: Whether or not the trial court erred in denying the motion to admit the amended complaint on the ground that the said amended complaint substantially changed or altered the cause of action in the original complaint. HELD: Yes. Since this case was decided by the Court of Appeals under the old law, we resolve it in that light. Thereunder, while substantial amendments were allowed even after the case had been set for hearing, such could only be done upon leave of court. That leave could be refused if the court found that: (a) the motion was made with intent to delay the action; or (b) the cause of action or defense was substantially altered. Amendments of pleadings are favored and should be liberally allowed in the furtherance of justice in order to determine every case as far as possible on its merits without regard to technicalities, to speed up trial and save party litigants from incurring unnecessary expense, so that a full hearing on the merits of every case may be had and multiplicity of suits avoided. It must be pointed out that the new Section 3 of Rule 10 of the Rules of Court relaxes further the rule on amendment of pleadings. Refusal to allow amendments other than those which may be made as a matter of right under Section 2, may be based only on the ground that the motion was made with intent to delay. The other ground,

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viz., the amendment substantially alters the original cause of action or defense, has been dropped from the Rule. This simply means then that amendments may substantially alter the cause of action or defense. 23 Case No. 23 (NABONG) REMINGTON INDUSTRIAL SALES CORPORATION, petitioner, vs. THE COURT OF APPEALS and BRITISH STEEL (ASIA), LTD., respondents. FACTS: Petitioner filed a complaint for sum of money and damages arising from breach of contract, before RTC of Manila, Branch 22. Principal defendant was Industrial Steels, Ltd. (ISL), with Ferro Trading GMBH (Ferro) and respondent British Steel as alternative defendants. ISL and respondent British Steel separately moved for the dismissal of the complaint on the ground that it failed to state a cause of action against them. RTC denied the motions to dismiss, as well as the motion for reconsideration. ISL then filed its answer to the complaint. Respondent British Steel filed a petition for certiorari and prohibition before the Court of Appeals. Respondent claimed that the complaint did not contain a single averment that respondent committed any act or is guilty of any omission in violation of petitioners legal rights. Subsequently, petitioner filed a Motion to Admit Amended Complaint by incorporating therein additional factual allegations constitutive of its cause of action against respondent before the trial court. Petitioner prayed that the proceedings in the special civil action be suspended. The trial court ruled on the Amended Complaint and further proceedings thereon and action on the other incidents as aforementioned are held in abeyance until final resolution of the petition for certiorari and prohibition of petitioner (defendant British) and/or Manifestations and Motions of therein private respondent, herein plaintiff. Thereafter, the Court of Appeals rendered the assailed decision granting the writ of certiorari and orders the respondent judge to dismiss the Complaint against petitioner British Steel. Petitioner filed a motion for reconsideration which was denied. ISSUE W/N a complaint can still be amended as a matter of right before an answer has been filed, even if there was a pending proceeding for its dismissal before the higher court? RULING Section 2, Rule 10 of the Revised Rules of Court explicitly states that a pleading may be amended as a matter of right before a responsive pleading is served. This only means that prior to the filing of an answer; the plaintiff has the absolute right to amend the complaint whether a new cause of action or change in theory is introduced. Reason for this rule is implied in the subsequent Section 3 of Rule 10. Under this provision, substantial amendment of the complaint is not allowed without leave of court after an answer has been served, because any material change in the allegations contained in the complaint could prejudice the rights of the defendant who has already set up his defense in the answer. In this case, the amendment of the complaint would not prejudice respondents or delay the action, as this would, in fact, simplify the case and expedite its disposition. Consequently, the amendment should be allowed in the case at bar as a matter of right in accordance with the rules. Petition granted. 24 Case No. 24 (Nabong) KERAMIK INDUSTRIES INC., Petitioner, vs. HONORABLE BUENAVENTURA J. GUERRERO in and GOVERNMENT SERVICE INSURANCE SYSTEM, Respondents. FACTS Keramik obtained a loan of P2,400,000 from the Government Service Insurance System (GSIS). As security, it mortgaged to the GSIS certain lands, buildings, machineries and equipment used in its ceramic business. Keramik's defaulted, reason for the GSIS to extrajudicially foreclosed the real and chattel mortgages. Keramik sued the GSIS asking for the nullification of the extrajudicial foreclosure due to supposed irregularities. Keramik filed a motion for the admission of its amended complaint. The amendment refers to the insurance in the sum of P2,400,000 which Keramik had allegedly secured from the GSIS for the mortgaged buildings, machineries and equipment. The insurance was an additional security for the loan. Keramik alleged it failed to mention in its original complaint the insurance and the circumstance that the typhoon Yoling totally damaged the insured

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properties. Its alternative contention was that the proceeds of the insurance and the excess premiums paid should be deducted from its indebtedness because the GSIS was in effect both the insurer and the insured. The GSIS opposed the admission of the amended complaint on the ground that the amendment altered the plaintiff's causes of action by supposedly injecting "new, distinct and entirely foreign causes of action". The lower court sustained the opposition and denied the admission of the amended complaint. Keramik then filed the instant special civil action of certiorari. It contends that the lower court acted with grave abuse of discretion in not admitting its amended complaint. ISSUE: W/N the trial court committed grave abuse of discretion in not allowing Petitioners Amended complaint RULING Yes, the trial court committed a grave abuse of discretion in not allowing Keramik to amend its complaint. Keramik's theory is that the mortgaged properties and the proceeds of the insurance were more than sufficient to cover its aggregate debt to the GSIS and, therefore, the latter, as bidder at the foreclosure sale, should refund to the mortgagor the excess or "the difference between the price at which the foreclosed property was bought and the actual indebtedness of defendant". The allegations in the amended complaint regarding the insurance for the mortgaged properties did not change at all Keramik's theory of the case and did not introduce a new cause of action. As may be seen from the original and amended complaints, the causes of action remained the same. The prayers of the two complaints are identical. The new matter concerning the insurance merely reinforced, amplified or enlarged Keramik's alternative cause of action for the recovery of the surplus or excess (See sec. 4, Rule 68 of the Rules of Court). The allowance of the amendment would be in the furtherance of justice and would not prejudice at all the GSIS or place it at a disadvantage since it could controvert the new matters constituting the amendment in an amended answer and during the trial. The trial court is directed to admit petitioner's amended complaint. 25 26 pascual pascual hard copy hard copy 27 G.R. No. 107824 July 5, 1996 SUPERCLEAN SERVICES CORPORATION, petitioner, vs. CA and HOME DEVELOPMENT MUTUAL FUND, respondents. FACTS: Superclean Services Corporation (SUPERCLEAN) alleged that at the public bidding for janitorial services for the year 1990 it was the "lowest or best bidder," but Home Development Mutual Fund (HDMF), refused without just cause to award the contract to it and instead caused the publication on October 23, 1989 of a Notice of Rebidding. Superclean filed with the RTC of Manila a complaint for Mandamus / Certiorari with Preliminary Injunction and/or Restraining Order against the HDMF. The HDMF defended its action on the ground that not a single bid submitted complied with the terms and conditions agreed upon in the pre-bidding conference. The RTC ordered the HDMF to desist from rebidding and hire janitorial services for month-to-month basis. Superclean moved for the admission of Supplemental Complaint because contract of services was for the furnishing of janitorial service for the previous year 1990, the delay in the decision of the case had rendered the case moot and academic "without petitioner obtaining complete relief to redress the wrong committed against it by respondent, which relief consists in unrealized profits, exemplary damages and attorney's fees." Thus, instead of pursuing its prayer for a writ of mandamus, petitioner sought the payment of damages to it. The trial court finds no merit and no basis on the motion. On appeal, CA affirms the decision on the RTC. ISSUES: 1. Whether or not Supplemental Complaint is admissible; 2. Whether or not petition for Mandamus is rendered moot and academic. HELD: The transaction, occurrence or event happening since the filing of the pleading, which is sought to be supplemented, must be pleaded in aid of a party's right or defense as the case may be. The supervening event is not invoked for that purpose but to justify the new relief sought. What was alleged in the motion as a supervening event causing damage to petitioner was the fact that the year for which the contract should have been made had passed without the resolution of the case. Only incidentally was it claimed that because of the award of a contract for janitorial services, on a month-to-month basis to a third party, petitioner failed to realize profits. The supervening event cited was not to reinforce or aid the original demand, which was for the execution of

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a contract in petitioner's favor, because petitioner's demand could no longer be enforced, thus justifying petitioner in changing the relief sought to one for recovery of damages. Petitioner's remedy was not to supplement, but rather to amend its complaint. It is true that a supplemental or an amended pleading presupposes the existence of a pleading. What was rendered moot and academic, however, was not petitioner's cause of action but only its prayer for the writ of mandamus. There was still an alternative remedy left to petitioner of seeking damages in lieu of an award of the contract. The basic allegations of fact in the original and in the amended complaints are the same, that respondent, without justification, refused to award the contract of services to petitioner. Through no fault of petitioner, the year for which janitorial services were to be rendered expired without the resolution of petitioner's case. It would be to exalt technicality over substance to require that petitioner file a new complaint. It would best serve the interests of justice if the so-called Supplemental Complaint is simply considered as embodying amendments to the original complaint. CAs decision is reversed, Remanded to RTC to admit Supplemental Complaint and to treat it as an amendment to the original complaint or to require petitioner to file an amended complaint, merging the relevant allegations of its original complaint and "Supplemental Complaint," and thereafter to allow private respondent to file an answer.