Badillo vs.

CA

FIRST DIVISION

OSCAR R. BADILLO, GIOVANNI C. ONG, EDGAR A. RAGASA represented by heirs CYNTHIA G. RAGASA, and their children JOSEPH, CATHERINE and CHARMAINE all surnamed RAGASA, ROLANDO SANCADA, and DIONISIO UMBALIN, Petitioners, - versus COURT OF APPEALS, REGISTER OF DEEDS OF QUEZON CITY, GOLDKEY DEVELOPMENT CORPORATION, JOSEFA CONEJERO, IGNACIO D. SONORON, PEDRO DEL ROSARIO, and DOWAL REALTY AND MANAGEMENT SYSTEM COMPANY, Respondents.

G.R. No. 131903 Present: PUNO, C.J., Chairperson, CARPIO, CORONA, AZCUNA, and LEONARDO-DE CASTRO, JJ.

Promulgated: June 26, 2008

x ---------------------------------------------------x DECISION CARPIO, J.:

The Case This petition for certiorari[1] assails the 17 September 1997 Decision[2] of the Court of Appeals in CA-G.R. CV No. 50035. The Court of Appeals dismissed the appeal filed by petitioners Oscar R. Badillo, Giovanni C. Ong, Edgar A. Ragasa, Rolando Sancada,

Badillo vs. CA

and Dionisio Umbalin (petitioners) questioning the 5 June 1995 Order[3] of Branch 222 of the Regional Trial Court of Quezon City in Civil Case No. Q-91-10510 for Annulment of Documents with Prayer for Issuance of Prohibitory and Mandatory Injunction and Damages. The Facts Petitioners alleged that they are the registered owners of several lots adjoining a road lot known as Lot 369-A-29 or Apollo Street of subdivision plan Psd-37971 (road lot). The road lot is a short access road which connects petitioners properties to the main road known as Road 20. The road lot is covered by Transfer Certificate of Title (TCT) No. RT-20895 (22682) and registered in the name of respondent Pedro del Rosario (del Rosario). Annotated at the back of TCT No. RT20895 is a court-ordered Entry No. 605/T-22655 which reads as follows: It is hereby made of record that as per order of the Court, the street lot covered by this title shall not be closed or disposed of by the registered owner without previous approval of the court.[4] Petitioners alleged that in gross violation of the court order, del Rosario sold an unsegregated portion of the road lot to his co-respondents JosefaConejero (Conejero) and Ignacio Sonoron (Sonoron) without obtaining prior court approval. Del Rosario, Conejero, and Sonoron then entered into a partition agreement to divide the road lot into four lots which resulted in the partial cancellation of TCT No. RT-20895 and the subsequent issuance of TCT Nos. 35899 and 35100 in the name of Conejero, TCT No. 35101 in the name of del Rosario, and TCT No. 35102 in the name of Sonoron.[5] Petitioners stated that del Rosario sold TCT No. 35101 to Goldkey Development Corporation (Goldkey).[6] Petitioners alleged that the Register of Deeds violated the court order when it allowed the registration of the sales and the subsequent issuance of new titles without first obtaining judicial approval. Petitioners claimed that Goldkey had built cement fences on the lot, thus blocking the ingress and egress of petitioners.[7] Petitioners prayed that the sales made in favor of Conejero, Sonoron, and Goldkey and the partition of the road lot be declared void.[8] In its Comment, Goldkey alleged that the Housing and Land Use Regulatory Board (HLURB) has exclusive jurisdiction over the cases mentioned in Section 1 of Presidential Decree No. (PD) 1344.[9] Goldkey argued that the Court of Appeals correctly dismissed petitioners appeal because petitioners merely assigned an error involving a pure

Badillo vs. CA

question of law. Goldkey added that petitioners are using the present petition as a substitute for an already lost appeal since petitioners counsel had received the decision on 17 October 1997 and the present petition was posted only on 16 December 1997.[10] In May 1991, petitioners filed an initial complaint with the Office of the Building Official (building official) of Quezon City, docketed as Building Case No. R-10-91-006 entitled Giovanni C. Ong, et al. v. Manuel Chua (building case).[11] Petitioners, who initiated the building case when Goldkey started putting up fences in some portions of the property, claimed that the parcel of land was a road lot.[12] On 10 September 1991, the HLURB issued a Development Permit to Goldkey allowing it to develop the land into residential townhouse units. The permit also mentioned that the project is classified as Residential Townhouse Subdivision and, as evaluated, the same is in accordance with the Zoning Ordinance of Quezon City.[13] On 4 November 1991,[14] petitioners filed a case for Annulment of Title and Damages[15] with the Regional Trial Court of Quezon City. Subsequently, the building official of Quezon City resolved the building case against petitioners and this decision became final and executory.[16] The ruling held that the property is not a road lot but a residential lot.[17] On 5 June 1995, Branch 222 of the Regional Trial Court (trial court) of Quezon City issued an order dismissing the case for lack of jurisdiction over the subject matter. The Ruling of the Trial Court The trial court dismissed petitioners case for lack of jurisdiction over the subject matter. The trial court pointed out that there was a decision rendered by the building official of Quezon City declaring the disputed property a residential lot and not a road lot; hence, the building official issued a building permit. The HLURB also issued a permit for the development of the land into a townhouse project. Petitioners did not appeal both rulings. The trial court stated that petitioners contention that the property is a road lot had been rendered moot by the finding of the building official which made the contrary declaration. If petitioners had any objection to the ruling, they should have appealed the same to the Secretary of Public Works and Highways as provided in Section 307 of Executive Order No. (EO) 1096. The findings of administrative agencies which have expertise are generally accorded not only respect but even finality.

Badillo vs. CA

The trial court also stated that the property had been approved by the HLURB for development into a townhouse project. The subject land was therefore removed from the jurisdiction of the regular courts. The HLURBs decision was also not appealed to the Office of the President as provided inSection 4 of PD 1344 which gave the HLURB quasi-judicial powers.

The Ruling of the Appellate Court On 17 September 1997, the Court of Appeals dismissed the appeal on the ground that it has no jurisdiction to entertain the same. The appellate court stated that the original and amended complaints filed by petitioners were both premised on the claim that the subject parcels of land were subdivision road lots that were illegally converted into residential lots and thereafter disposed by del Rosario, the subdivision developer. Therefore, petitioners complaints were filed for the purpose of enforcing a contractual and statutory obligation of del Rosario to preserve a subdivision road lot for street purposes. As such, the agency with jurisdiction is the HLURB, pursuant to the provisions of PD 957, 1216, and 1344, EO 648 dated 7 February 1981 and EO 90 dated 17 December 1986. Further, the appellate court ruled that the error assigned by petitioners involves the issue on what law will apply to determine the jurisdiction of a tribunal over the subject matter of the complaints. Petitioners assigned error involves a pure question of law; hence, petitioners appealed to the wrong forum. Petitioners should have elevated their appeal to the Supreme Court and not to the Court of Appeals by way of a simple appeal. Hence, this petition. The Issues Petitioners raise three issues in this petition: 1. Whether the appellate court acted without or in excess of jurisdiction or with grave abuse of discretion by dismissing petitioners appeal on the ground that jurisdiction does not lie with the regular courts but with the HLURB; 2. Whether the Court of Appeals acted without or in excess of jurisdiction or grave abuse of discretion by dismissing petitioners appeal on the ground that petitioners did not assign any error of fact; and 3. Whether a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure is the proper remedy for petitioners.

Badillo vs. CA

The Ruling of the Court

The petition lacks merit. The HLURB is the sole regulatory body for housing and land development. [18] The extent to which an administrative agency may exercise its powers depends on the provisions of the statute creating such agency.[19] Courts will not determine a controversy where the issues for resolution demand the exercise of sound administrative discretion.[20]

Jurisdiction Lies with the HLURB PD 957,[21] otherwise known as The Subdivision and Condominium Buyers Protective Decree, granted the National Housing Authority (NHA) the exclusive jurisdiction to regulate the real estate business. The scope of the regulatory authority lodged in the NHA is indicated in the second whereas clause which states:
WHEREAS, numerous reports reveal that many real estate subdivision owners, developers, operators, and/or sellers have reneged on their representations and obligations to provide and maintain properly subdivision roads, drainage, sewerage, water systems, lighting systems, and other similar basic requirements, thus endangering the health and safety of home and lot buyers, (Emphasis supplied)

Thus, Section 22 of PD 957 provides:

Sec. 22. Alteration of Plans. No owner or developer shall change or alter the roads, open spaces, infrastructures, facilities for public use and/or other form of subdivision development as contained in the approved subdivision plan and/or represented in its advertisements, without the permission of the Authority and the written conformity or consent of the duly organized homeowners association, or in the absence of the latter, by the majority of the lot buyers in the subdivision. (Emphasis supplied)

PD 1344[22] amended PD 957 by empowering the NHA to issue writs of execution in the enforcement of its decisions. Section 1 of PD 1344 states:

Badillo vs. CA

Section 1. In the exercise of its functions 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, dealer, broker or salesman. (Emphasis supplied)

Under EO 648,[23] the NHAs functions were transferred to the Human Settlement Regulatory Commission. Section 8 of EO 648 provides:
Section 8. Transfer of Functions. The regulatory functions of the National Housing Authority pursuant to Presidential Decrees No. 957, 1216, 1344 and other related laws are hereby transferred to the Commission, together with such applicable personnel, appropriation, records, equipment and property necessary for the enforcement and implementation of such functions. Among these regulatory functions are: (1) Regulation of the real estate trade and business; (2) Registration of subdivision lots and condominium projects; (3) Issuance of license to sell subdivision lots and condominium units in the registered units; (4) Approval of performance bond and the suspension of license to sell; (5) Registration of dealers, brokers and salesmen engaged in the business of selling subdivision lots or condominium units; (6) Revocation of registration of dealers, brokers and salesmen; (7) Approval or mortgage on any subdivision lot or condominium unit made by the owner or developer; (8) Granting of permits for the alteration of plans and the extension of period for completion of subdivision or condominium projects; (9) Approval of the conversion to other purposes of roads and open spaces found within the project which have been donated to the city or municipality concerned; (10) Regulation of the relationship between lessors and lessees; and (11) Hear and decidecases on unsound real estate business practices; claims involving refund filed against project owners, developers, dealers, brokers or salesmen and cases of specific performance.(Emphasis supplied)

EO 90[24] renamed the Human Settlement Regulatory Commission the Housing and Land Use Regulatory Board. The HLURB retained the regulatory and adjudicatory functions of the NHA. Clearly, the scope and limitation of the HLURBs jurisdiction are well-defined. The HLURBs jurisdiction to hear and decide cases is determined by the nature of the cause of action, the subject matter or property involved, and the parties. [25] In the present case, petitioners are the registered owners of several lots adjoining a subdivision road lot connecting their properties to the main road. Petitioners allege that the subdivision lot owners sold the road lot to a developer who is now constructing cement fences, thus blocking the passageway from their lots to the main road. In sum, petitioners are enforcing their statutory and contractual rights against the

Badillo vs. CA

subdivision owners. This is a specific performance case which falls under the HLURBs exclusive jurisdiction. In Osea v. Ambrosio,[26] the Court held that the provisions of PD 957 were intended to encompass all questions relating to subdivisions. This intention was aimed to provide for an appropriate government agency, which is the HLURB, to which all parties aggrieved in the implementation of provisions and the enforcement of contractual rights with respect to said category of real estate may take recourse. Petitioners claim that respondents violated the annotation at the back of TCT No. RT-20895 by selling an unsegregated portion of the lot without obtaining prior court approval. The date of entry of this annotation is 18 August 1953. When PD 957, PD 1344, and EO 648 were enacted in 1976, 1978, and 1981, respectively, this annotation was impliedly modified such that the conversion of the road lot in the subdivision plan would fall under the HLURBsjurisdiction pursuant to these laws. Petitioners argue that they can file a specific performance case to compel respondents to comply with their contractual and statutory obligation to maintain the road lot. However, petitioners can only be granted complete relief if the subject sales are declared void and the subsequent partition is declared illegal. Petitioners further contend that the HLURB, having only the jurisdiction to hear and decide specific performance cases, can only compel petitioners to file a case for annulment of title and prosecute the action. Petitioners insist that in the final analysis, a case for annulment of title would still have to be filed with the ordinary courts. [27] In Pea v. GSIS,[28] the Court ruled that when an administrative agency is conferred quasijudicial functions, all controversies relating to the subject matter pertaining to its specialization are deemed to be included within its jurisdiction. Split jurisdiction is not favored. As observed in C.T. Torres Enterprises, Inc. v. Hibionada:[29]
The argument that only courts of justice can adjudicate claims resoluble under the provisions of the Civil Code is out of step with the fast-changing times. There are hundreds of administrative bodies now performing this function by virtue of a valid authorization from the legislature. This quasi-judicial function, as it is called, is exercised by them as an incident of the principal power entrusted to them of regulating certain activities falling under their particular expertise. In the Solid Homes case for example the Court affirmed the competence of the Housing and Land Use Regulatory Board to award damages although this is an essentially judicial power exercisable ordinarily only by the courts of justice. This departure from the traditional allocation of governmental powers is justified by expediency, or the need of the government to respond swiftly and competently to the pressing problems of the modern world.

Badillo vs. CA

Finally, in Cristobal v. Court of Appeals,[30] we held that questions relating to noncompliance with the requisites for conversion of subdivision lots are properly cognizable by the NHA, now the HLURB, pursuant to Section 22 of PD 957 and not by the regular courts. Appeal by Certiorari Involving Questions of Law

Section 2, Rule 41 of the Rules of Court states:

Sec. 2. Mode of appeal. (a) Ordinary Appeal. The appeal to the Court of Appeals in cases decided by the Regional Trial Court in the exercise of its original jurisdiction shall be taken by filing a notice of appeal with the court which rendered the judgment or final order appealed from and serving a copy thereof upon the adverse party. No record on appeal shall be required except in special proceedings and other cases of multiple or separate appeals where the law or these Rules so require. In such cases, the record on appeal shall be filed and served in like manner. (b) Petition for Review. The appeal to the Court of Appeals in cases decided by the Regional Trial Court in the exercise of its appellate jurisdiction shall be by petition for review in accordance with Rule 42. (c) Appeal by certiorari. In all cases where only questions of law are raised or involved, the appeal shall be to the Supreme Court by petition for review on certiorari in accordance with Rule 45. (Emphasis supplied)

In Sevilleno v. Carilo,[31] citing Macawiwili Gold Mining and Development Co., Inc. v. Court of Appeals, this Court summarized the rule on appeals:
(1) In all cases decided by the RTC in the exercise of its original jurisdiction, appeal may be made to the Court of Appeals by mere notice of appeal where the appellant raises questions of fact or mixed questions of fact and law; (2) In all cases decided by the RTC in the exercise of its original jurisdiction where the appellant raises only questions of law, the appeal must be taken to the Supreme Court on a petition for review on certiorari under Rule 45. (3) All appeals from judgments rendered by the RTC in the exercise of its appellate jurisdiction, regardless of whether the appellant raises questions of fact, questions of law, or mixed questions of fact and law, shall be brought to the Court of Appeals by filing a petition for review under Rule 42. (Emphasis supplied)

Badillo vs. CA

In First Bancorp, Inc. v. Court of Appeals,[32] this Court also explained the two modes of appeal from a final order of the trial court in the exercise of its original jurisdiction:
(1) by writ of error under Section 2(a), Rule 41 of the Rules of Court if questions of fact or questions of fact and law are raised or involved; or (2) appeal by certiorari under Section 2(c), Rule 41, in relation to Rule 45, where only questions of law are raised or involved. (Emphasis supplied)

In the present case, petitioners raised only one issue in their Appellants Brief whether the Honorable Trial Court a quo seriously erred in holding that it has no jurisdiction over the subject matter of the case when in fact it has already acquired jurisdiction over the persons of the defendants and the subject matter of the case. The question on jurisdiction is undoubtedly one of law. We have held that a question of law exists when the doubt or controversy concerns the correct application of law or jurisprudence to a certain set of facts; or when the issue does not call for an examination of the probative value of the evidence presented, the truth or falsehood of facts being admitted. [33] Consequently, it is not disputed that the issue brought by petitioners to the Court of Appeals involves solely the trial courts jurisdiction over the subject matter of the case. The appellate court can determine the issue raised without reviewing or evaluating the evidence. As petitioners appeal solely involves a question of law, the appellate court did not err in dismissing the appeal on the ground of lack of jurisdiction pursuant to Section 2, Rule 50 of the Rules of Court which provides:
Sec. 2. Dismissal of improper appeal to the Court of Appeals. An appeal under Rule 41 taken from the Regional Trial Court to the Court of Appeals raisingonly questions of law shall be dismissed, issues purely of law not being reviewable by said court. Similarly, an appeal by notice of appeal instead of by petition for review from the appellate judgment of a Regional Trial Court shall be dismissed. An appeal erroneously taken to the Court of Appeals shall not be transferred to the appropriate court but shall be dismissed outright. (Emphasis supplied)

Rule 65 is not a remedy for lost appeal.

Petitioners should have directly taken their appeal to this Court by filing a petition for review on certiorari under Rule 45 and not an ordinary appeal with the Court of Appeals under Rule 41 nor a petition for certiorari with this Court under Rule 65.

Badillo vs. CA

As held in Balayan v. Acorda,[34] the special civil action for certiorari is a limited form of review and is a remedy of last recourse. It lies only where there is no appeal or plain, speedy, and adequate remedy in the ordinary course of law. In the present case, petitioners chose the wrong mode of appeal. Hence, the instant petition cannot prevail since a petition for certiorari is not a substitute for a lost appeal, especially if the loss or lapse was an error in petitioners choice of remedy. We have held in David v. Cordova[35] that:
A petition for certiorari cannot be a substitute for an appeal from a lower court decision. Where appeal is available to the aggrieved party, the action for certiorari will not be entertained. The remedies of appeal (including petitions for review) and certiorari are mutually exclusive, not alternate or successive. Hence, certiorari is not and cannot be a substitute for an appeal, especially if ones own negligence or error in ones choice of remedy occasioned such loss or lapse. One of the requisites of certiorari is that there be no available appeal or any plain, speedy and adequate remedy. Where an appeal is available, certiorari will not prosper, even if the ground therefore is grave abuse of discretion. (Emphasis supplied)

There were instances when the Court has relaxed the rule on the special civil action for certiorari as a substitute for failure to file a timely petition for review on certiorari under Rule 45 such as where the application of this rule would result in a manifest failure or miscarriage of justice.[36] Although the Court has the discretion to treat a petition for certiorari as having been filed under Rule 45, there is nothing in the present case to warrant a liberal application of the rules. WHEREFORE, we DISMISS the petition. We AFFIRM the Decision of the Court of Appeals. Costs against petitioners. SO ORDERED. 17 September 1997

SEC vs. GMA

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 164026 December 23, 2008

SECURITIES AND EXCHANGE COMMISSION, petitioner, vs. GMA NETWORK, INC., respondent. DECISION TINGA, J.: Petitioner Securities and Exchange Commission (SEC) assails the Decision1 dated February 20, 2004 of the Court of Appeals in CA-G.R. SP No. 68163, which directed that SEC Memorandum Circular No. 1, Series of 1986 should be the basis for computing the filing fee relative to GMA Network, Inc.s (GMAs) application for the amendment of its articles of incorporation for purposes of extending its corporate term. The undisputed facts as narrated by the appellate court are as follows: On August 19, 1995, the petitioner, GMA NETWORK, INC., (GMA, for brevity), a domestic corporation, filed an application for collective approval of various amendments to its Articles of Incorporation and By-Laws with the respondent Securities and Exchange Commission, (SEC, for brevity). The amendments applied for include, among others, the change in the corporate name of petitioner from "Republic Broadcasting System, Inc." to "GMA Network, Inc." as well as the extension of the corporate term for another fifty (50) years from and after June 16, 2000. Upon such filing, the petitioner had been assessed by the SECs Corporate and Legal Department a separate filing fee for the application for extension of corporate term equivalent to 1/10 of 1% of its authorized capital stock plus 20% thereof or an amount of P1,212,200.00. On September 26, 1995, the petitioner informed the SEC of its intention to contest the legality and propriety of the said assessment. However, the petitioner requested the SEC to approve the other amendments being requested by the petitioner without being deemed to have withdrawn its application for extension of corporate term. On October 20, 1995, the petitioner formally protested the assessment amounting to P1,212,200.00 for its application for extension of corporate term. On February 20, 1996, the SEC approved the other amendments to the petitioners Articles of Incorporation, specifically Article 1 thereof referring to the corporate name of the petitioner as well as Article 2 thereof referring to the principal purpose for which the petitioner was formed. On March 19, 1996, the petitioner requested for an official opinion/ruling from the SEC on the validity and propriety of the assessment for application for extension of its corporate term. Consequently, the respondent SEC, through Associate Commissioner Fe Eloisa C. Gloria, on April 18, 1996, issued its ruling upholding the validity of the questioned assessment, the dispositive portion of which states: "In light of the foregoing, we believe that the questioned assessment is in accordance with law. Accordingly, you are hereby required to comply with the required filing fee."

SEC vs. GMA An appeal from the aforequoted ruling of the respondent SEC was subsequently taken by the petitioner on the ground that the assessment of filing fees for the petitioners application for extension of corporate term equivalent to 1/10 of 1% of the authorized capital stock plus 20% thereof is not in accordance with law.
On September 26, 2001, following three (3) motions for early resolution filed by the petitioner, the respondent SEC En Banc issued the assailed order dismissing the petitioners appeal, the dispositive portion of which provides as follows: WHEREFORE, for lack of merit, the instant Appeal is hereby dismissed. SO ORDERED.2 In its petition for review3 with the Court of Appeals, GMA argued that its application for the extension of its corporate term is akin to an amendment and not to a filing of new articles of incorporation. It further averred that SEC Memorandum Circular No. 2, Series of 1994, which the SEC used as basis for assessing P1,212,200.00 as filing fee for the extension of GMAs corporate term, is not valid. The appellate court agreed with the SECs submission that an extension of the corporate term is a grant of a fresh license for a corporation to act as a juridical being endowed with the powers expressly bestowed by the State. As such, it is not an ordinary amendment but is analogous to the filing of new articles of incorporation. However, the Court of Appeals ruled that Memorandum Circular No. 2, Series of 1994 is legally invalid and ineffective for not having been published in accordance with law. The challenged memorandum circular, according to the appellate court, is not merely an internal or interpretative rule, but affects the public in general. Hence, its publication is required for its effectivity. The appellate court denied reconsideration in a Resolution4 dated June 9, 2004. In its Memorandum5 dated September 6, 2005, the SEC argues that it issued the questioned memorandum circular in the exercise of its delegated legislative power to fix fees and charges. The filing fees required by it are allegedly uniformly imposed on the transacting public and are essential to its supervisory and regulatory functions. The fees are not a form of penalty or sanction and, therefore, require no publication. For its part, GMA points out in its Memorandum,6 dated September 23, 2005, that SEC Memorandum Circular No. 1, Series of 1986 refers to the filing fees for amended articles of incorporation where the amendment consists of extending the term of corporate existence. The questioned circular, on the other hand, refers only to filing fees for articles of incorporation. Thus, GMA argues that the former circular, being the one that specifically treats of applications for the extension of corporate term, should apply to its case. Assuming that Memorandum Circular No. 2, Series of 1994 is applicable, GMA avers that the latter did not take effect and cannot be the basis for the imposition of the fees stated therein for the reasons that it was neither filed with the University of the Philippines Law Center nor published either in the Official Gazette or in a newspaper of general circulation as required under existing laws. It should be mentioned at the outset that the authority of the SEC to collect and receive fees as authorized by law is not in question.7 Its power to collect fees for examining and filing articles of incorporation and by-laws and amendments thereto, certificates of increase or decrease of the capital stock, among others, is recognized. Likewise established is its power under Sec. 7 of P.D. No. 902-A to recommend to the President the revision, alteration, amendment or adjustment of the charges which it is authorized to collect. The subject of the present inquiry is not the authority of the SEC to collect and receive fees and charges, but rather the validity of its imposition on the basis of a memorandum circular which, the Court of Appeals held, is ineffective. Republic Act No. 3531 (R.A. No. 3531) provides that where the amendment consists in extending the term of corporate existence, the SEC "shall be entitled to collect and receive for the filing of the amended articles of incorporation the

SEC vs. GMA same fees collectible under existing law as the filing of articles of incorporation."8 As is clearly the import of this law, the SEC shall be entitled to collect and receive the same fees it assesses and collects both for the filing of articles of incorporation and the filing of an amended articles of incorporation for purposes of extending the term of corporate existence.
The SEC, effectuating its mandate under the aforequoted law and other pertinent laws,9 issued SEC Memorandum Circular No. 1, Series of 1986, imposing the filing fee of 1/10 of 1% of the authorized capital stock but not less thanP300.00 nor more than P100,000.00 for stock corporations, and 1/10 of 1% of the authorized capital stock but not less than P200.00 nor more than P100,000.00 for stock corporations without par value, for the filing of amended articles of incorporation where the amendment consists of extending the term of corporate existence. Several years after, the SEC issued Memorandum Circular No. 2, Series of 1994, imposing new fees and charges and deleting the maximum filing fee set forth in SEC Circular No. 1, Series of 1986, such that the fee for the filing of articles of incorporation became 1/10 of 1% of the authorized capital stock plus 20% thereof but not less thanP500.00. A reading of the two circulars readily reveals that they indeed pertain to different matters, as GMA points out. SEC Memorandum Circular No. 1, Series of 1986 refers to the filing fee for the amendment of articles of incorporation to extend corporate life, while Memorandum Circular No. 2, Series of 1994 pertains to the filing fee for articles of incorporation. Thus, as GMA argues, the former circular, being squarely applicable and, more importantly, being more favorable to it, should be followed. What this proposition fails to consider, however, is the clear directive of R.A. No. 3531 to impose the same fees for the filing of articles of incorporation and the filing of amended articles of incorporation to reflect an extension of corporate term. R.A. No. 3531 provides an unmistakable standard which should guide the SEC in fixing and imposing its rates and fees. If such mandate were the only consideration, the Court would have been inclined to rule that the SEC was correct in imposing the filing fees as outlined in the questioned memorandum circular, GMAs argument notwithstanding. However, we agree with the Court of Appeals that the questioned memorandum circular is invalid as it does not appear from the records that it has been published in the Official Gazette or in a newspaper of general circulation. Executive Order No. 200, which repealed Art. 2 of the Civil Code, provides that "laws shall take effect after fifteen days following the completion of their publication either in the Official Gazette or in a newspaper of general circulation in the Philippines, unless it is otherwise provided." In Taada v. Tuvera,10 the Court, expounding on the publication requirement, held: We hold therefore that all statutes, including those of local application and private laws, shall be published as a condition for their effectivity, which shall begin fifteen days after publication unless a different effectivity date is fixed by the legislature. Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative powers whenever the same are validly delegated by the legislature, or, at present, directly conferred by the Constitution. Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law pursuant also to a valid delegation. Interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the administrative agency and not the public, need not be published. Neither is publication required of the so-called letters of instructions issued by administrative superiors concerning the rules or guidelines to be followed by their subordinates in the performance of their duties.11 The questioned memorandum circular, furthermore, has not been filed with the Office of the National Administrative Register of the University of the Philippines Law Center as required in the Administrative Code of 1987.12 In Philsa International Placement and Services Corp. v. Secretary of Labor and Employment,13 Memorandum Circular No. 2, Series of 1983 of the Philippine Overseas Employment Administration, which provided for the schedule of

SEC vs. GMA placement and documentation fees for private employment agencies or authority holders, was struck down as it was not published or filed with the National Administrative Register.
The questioned memorandum circular, it should be emphasized, cannot be construed as simply interpretative of R.A. No. 3531. This administrative issuance is an implementation of the mandate of R.A. No. 3531 and indubitably regulates and affects the public at large. It cannot, therefore, be considered a mere internal rule or regulation, nor an interpretation of the law, but a rule which must be declared ineffective as it was neither published nor filed with the Office of the National Administrative Register. A related factor which precludes consideration of the questioned issuance as interpretative in nature merely is the fact the SECs assessment amounting to P1,212,200.00 is exceedingly unreasonable and amounts to an imposition. A filing fee, by legal definition, is that charged by a public official to accept a document for processing. The fee should be just, fair, and proportionate to the service for which the fee is being collected, in this case, the examination and verification of the documents submitted by GMA to warrant an extension of its corporate term. Rate-fixing is a legislative function which concededly has been delegated to the SEC by R.A. No. 3531 and other pertinent laws. The due process clause, however, permits the courts to determine whether the regulation issued by the SEC is reasonable and within the bounds of its rate-fixing authority and to strike it down when it arbitrarily infringes on a persons right to property. WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. SP No. 68163, dated February 20, 2004, and its Resolution, dated June 9, 2004, are AFFIRMED. No pronouncement as to costs. SO ORDERED.

NHA vs. Almeida

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 162784 June 22, 2007

NATIONAL HOUSING AUTHORITY, petitioner, vs. SEGUNDA ALMEIDA, COURT OF APPEALS, and RTC of SAN PEDRO, LAGUNA, BR. 31, respondents. DECISION PUNO, C.J.: This is a Petition for Review on Certiorari under Rule 45 filed by the National Housing Authority (NHA) against the Court of Appeals, the Regional Trial Court of San Pedro Laguna, Branch 31, and private respondent Segunda Almeida. On June 28, 1959, the Land Tenure Administration (LTA) awarded to Margarita Herrera several portions of land which are part of the Tunasan Estate in San Pedro, Laguna. The award is evidenced by an Agreement to Sell No. 3787.1 By virtue of Republic Act No. 3488, the LTA was succeeded by the Department of Agrarian Reform (DAR). On July 31, 1975, the DAR was succeeded by the NHA by virtue of Presidential Decree No. 757.2 NHA as the successor agency of LTA is the petitioner in this case. The records show that Margarita Herrera had two children: Beatriz Herrera-Mercado (the mother of private respondent) and Francisca Herrera. Beatriz Herrera-Mercado predeceased her mother and left heirs. Margarita Herrera passed away on October 27, 1971.3 On August 22, 1974, Francisca Herrera, the remaining child of the late Margarita Herrera executed a Deed of SelfAdjudication claiming that she is the only remaining relative, being the sole surviving daughter of the deceased. She also claimed to be the exclusive legal heir of the late Margarita Herrera. The Deed of Self-Adjudication was based on a Sinumpaang Salaysay dated October 7, 1960, allegedly executed by Margarita Herrera. The pertinent portions of which are as follows: SINUMPAANG SALAYSAY SA SINO MAN KINAUUKULAN; Akong si MARGARITA HERRERA, Filipina, may 83 taong gulang, balo, kasalukuyang naninirahan at tumatanggap ng sulat sa Nayon ng San Vicente, San Pedro Laguna, sa ilalim ng panunumpa ay malaya at kusang loob kong isinasaysay at pinagtitibay itong mga sumusunod: 1. Na ako ay may tinatangkilik na isang lagay na lupang tirikan (SOLAR), tumatayo sa Nayon ng San Vicente, San Pedro, Laguna, mayroong PITONG DAAN AT PITUMPU'T ISANG (771) METRONG PARISUKAT ang laki, humigit kumulang, at makikilala sa tawag na Lote 17, Bloke 55, at pag-aari ng Land Tenure Administration; 2. Na ang nasabing lote ay aking binibile, sa pamamagitan ng paghuhulog sa Land Tenure Administration, at noong ika 30 ng Julio, 1959, ang Kasunduang sa Pagbibile (AGREEMENT TO SELL No. 3787) ay ginawa at pinagtibay sa Lungsod ng Maynila, sa harap ng Notario Publico na si G. Jose C. Tolosa, at lumalabas sa kaniyang Libro Notarial bilang Documento No. 13, Pagina No. 4; Libro No. IV, Serie ng 1959;

NHA vs. Almeida 3. Na dahilan sa ako'y matanda na at walang ano mang hanap buhay, ako ay nakatira at pinagsisilbihan nang aking anak na si Francisca Herrera, at ang tinitirikan o solar na nasasabi sa unahan ay binabayaran ng kaniyang sariling cuarta sa Land Tenure Administration;
4. Na alang-alang sa nasasaysay sa unahan nito, sakaling ako'y bawian na ng Dios ng aking buhay, ang lupang nasasabi sa unahan ay aking ipinagkakaloob sa nasabi kong anak na FRANCISCA HERRERA, Filipina, nasa katamtamang gulang, kasal kay Macario Berroya, kasalukuyang naninirahan at tumatanggap ng sulat sa Nayong ng San Vicente, San Pedro Laguna, o sa kaniyang mga tagapagmana at; 5. Na HINIHILING KO sa sino man kinauukulan, na sakaling ako nga ay bawian na ng Dios ng aking buhay ay KILALANIN, IGALANG at PAGTIBAYIN ang nilalaman sa pangalan ng aking anak na si Francisca Herrera ang loteng nasasabi sa unahan. SA KATUNAYAN NG LAHAT, ako ay nag-didiit ng hinlalaki ng kanan kong kamay sa ibaba nito at sa kaliwang gilid ng unang dahon, dito sa Lungsod ng Maynila, ngayong ika 7 ng Octubre, 1960.4 The said document was signed by two witnesses and notarized. The witnesses signed at the left-hand side of both pages of the document with the said document having 2 pages in total. Margarita Herrera placed her thumbmark5above her name in the second page and at the left-hand margin of the first page of the document. The surviving heirs of Beatriz Herrera-Mercado filed a case for annulment of the Deed of Self-Adjudication before the then Court of First Instance of Laguna, Branch 1 in Binan, Laguna (now, Regional Trial Court Branch 25). The case for annulment was docketed as Civil Case No. B-1263.6 On December 29, 1980, a Decision in Civil Case No. B-1263 (questioning the Deed of Self-Adjudication) was rendered and the deed was declared null and void.7 During trial on the merits of the case assailing the Deed of Self-Adjudication, Francisca Herrera filed an application with the NHA to purchase the same lots submitting therewith a copy of the "Sinumpaang Salaysay" executed by her mother. Private respondent Almeida, as heir of Beatriz Herrera-Mercado, protested the application. In a Resolution8 dated February 5, 1986, the NHA granted the application made by Francisca Herrera, holding that: From the evidence of the parties and the records of the lots in question, we gathered the following facts: the lots in question are portions of the lot awarded and sold to the late Margarita Herrera on July 28, 1959 by the defunct Land Tenure Administration; protestant is the daughter of the late Beatriz Herrera Mercado who was the sister of the protestee; protestee and Beatriz are children of the late Margarita Herrera; Beatriz was the transferee from Margarita of Lot Nos. 45, 46, 47, 48 and 49, Block 50; one of the lots transferred to Beatriz, e.g. Lot 47, with an area of 148 square meters is in the name of the protestant; protestant occupied the lots in question with the permission of the protestee; protestee is a resident of the Tunasan Homesite since birth; protestee was born on the lots in question; protestee left the place only after marriage but resided in a lot situated in the same Tunasan Homesite; her (protestee) son Roberto Herrera has been occupying the lots in question; he has been there even before the death of the late Margarita Herrera; on October 7, 1960, Margarita Herrera executed a "Sinumpaang Salaysay" whereby she waived or transferred all her rights and interest over the lots in question in favor of the protestee; and protestee had paid the lots in question in full on March 8, 1966 with the defunct Land Tenure Administration. This Office finds that protestee has a better preferential right to purchase the lots in question.9 Private respondent Almeida appealed to the Office of the President.10 The NHA Resolution was affirmed by the Office of the President in a Decision dated January 23, 1987.11 On February 1, 1987, Francisca Herrera died. Her heirs executed an extrajudicial settlement of her estate which they submitted to the NHA. Said transfer of rights was approved by the NHA.12 The NHA executed several deeds of sale in favor of the heirs of Francisca Herrera and titles were issued in their favor.13 Thereafter, the heirs of Francisca Herrera directed Segunda Mercado-Almeida to leave the premises that she was occupying.

NHA vs. Almeida Feeling aggrieved by the decision of the Office of the President and the resolution of the NHA, private respondent Segunda Mercado-Almeida sought the cancellation of the titles issued in favor of the heirs of Francisca. She filed a Complaint on February 8, 1988, for "Nullification of Government Lot's Award," with the Regional Trial Court of San Pedro, Laguna, Branch 31.
In her complaint, private respondent Almeida invoked her forty-year occupation of the disputed properties, and reraised the fact that Francisca Herrera's declaration of self-adjudication has been adjudged as a nullity because the other heirs were disregarded. The defendant heirs of Francisca Herrera alleged that the complaint was barred by laches and that the decision of the Office of the President was already final and executory.14 They also contended that the transfer of purchase of the subject lots is perfectly valid as the same was supported by a consideration and that Francisca Herrera paid for the property with the use of her own money.15 Further, they argued that plaintiff's occupation of the property was by mere tolerance and that they had been paying taxes thereon.16 The Regional Trial Court issued an Order dated June 14, 1988 dismissing the case for lack of jurisdiction.17 The Court of Appeals in a Decision dated June 26, 1989 reversed and held that the Regional Trial Court had jurisdiction to hear and decide the case involving "title and possession to real property within its jurisdiction."18The case was then remanded for further proceedings on the merits. A pre-trial was set after which trial ensued. On March 9, 1998, the Regional Trial Court rendered a Decision setting aside the resolution of the NHA and the decision of the Office of the President awarding the subject lots in favor of Francisca Herrera. It declared the deeds of sale executed by NHA in favor of Herrera's heirs null and void. The Register of Deeds of Laguna, Calamba Branch was ordered to cancel the Transfer Certificate of Title issued. Attorney's fees were also awarded to private respondent. The Regional Trial Court ruled that the "Sinumpaang Salaysay" was not an assignment of rights but a disposition of property which shall take effect upon death. It then held that the said document must first be submitted to probate before it can transfer property. Both the NHA and the heirs of Francisca Herrera filed their respective motions for reconsideration which were both denied on July 21, 1998 for lack of merit. They both appealed to the Court of Appeals. The brief for the heirs of Francisca Herrera was denied admission by the appellate court in a Resolution dated June 14, 2002 for being a "carbon copy" of the brief submitted by the NHA and for being filed seventy-nine (79) days late. On August 28, 2003, the Court of Appeals affirmed the decision of the Regional Trial Court, viz: There is no dispute that the right to repurchase the subject lots was awarded to Margarita Herrera in 1959. There is also no dispute that Margarita executed a "Sinumpaang Salaysay" on October 7, 1960. Defendant NHA claims that the "Sinumpaang Salaysay" is, in effect, a waiver or transfer of rights and interest over the subject lots in favor of Francisca Herrera. This Court is disposed to believe otherwise. After a perusal of the "Sinumpaang Salaysay" of Margarita Herrera, it can be ascertained from its wordings taken in their ordinary and grammatical sense that the document is a simple disposition of her estate to take effect after her death. Clearly the Court finds that the "Sinumpaang Salaysay" is a will of Margarita Herrera. Evidently, if the intention of Margarita Herrera was to merely assign her right over the lots to her daughter Francisca Herrera, she should have given her "Sinumpaang Salaysay" to the defendant NHA or to Francisca Herrera for submission to the defendant NHA after the full payment of the purchase price of the lots or even prior thereto but she did not. Hence it is apparent that she intended the "Sinumpaang Salaysay" to be her last will and not an assignment of rights as what the NHA in its resolution would want to make it appear. The intention of Margarita Herrera was shared no less by Francisca Herrera who after the former's demise executed on August 22, 1974 a Deed of Self-Adjudication claiming that she is her sole and legal heir. It was only when said deed was questioned in court by the surviving heirs of Margarita Herrera's other daughter, Beatriz Mercado, that Francisca Herrera filed an application to purchase the subject lots and presented the "Sinumpaang Salaysay" stating that it is a deed of assignment of rights.19 The Court of Appeals ruled that the NHA acted arbitrarily in awarding the lots to the heirs of Francisca Herrera. It upheld the trial court ruling that the "Sinumpaang Salaysay" was not an assignment of rights but one that involved

NHA vs. Almeida disposition of property which shall take effect upon death. The issue of whether it was a valid will must first be determined by probate.
Petitioner NHA elevated the case to this Court. Petitioner NHA raised the following issues: A. WHETHER OR NOT THE RESOLUTION OF THE NHA AND THE DECISION OF THE OFFICE OF THE PRESIDENT HAVE ATTAINED FINALITY, AND IF SO, WHETHER OR NOT THE PRINCIPLE OF ADMINISTRATIVE RES JUDICATA BARS THE COURT FROM FURTHER DETERMINING WHO BETWEEN THE PARTIES HAS PREFERENTIAL RIGHTS FOR AWARD OVER THE SUBJECT LOTS; B. WHETHER OR NOT THE COURT HAS JURISDICTION TO MAKE THE AWARD ON THE SUBJECT LOTS; AND C. WHETHER OR NOT THE AWARD OF THE SUBJECT LOTS BY THE NHA IS ARBITRARY. We rule for the respondents. Res judicata is a concept applied in review of lower court decisions in accordance with the hierarchy of courts. But jurisprudence has also recognized the rule of administrative res judicata: "the rule which forbids the reopening of a matter once judicially determined by competent authority applies as well to the judicial and quasi-judicial facts of public, executive or administrative officers and boards acting within their jurisdiction as to the judgments of courts having general judicial powers . . . It has been declared that whenever final adjudication of persons invested with power to decide on the property and rights of the citizen is examinable by the Supreme Court, upon a writ of error or a certiorari, such final adjudication may be pleaded as res judicata."20 To be sure, early jurisprudence were already mindful that the doctrine of res judicata cannot be said to apply exclusively to decisions rendered by what are usually understood as courts without unreasonably circumscribing the scope thereof and that the more equitable attitude is to allow extension of the defense to decisions of bodies upon whom judicial powers have been conferred. In Ipekdjian Merchandising Co., Inc. v. Court of Tax Appeals,21 the Court held that the rule prescribing that "administrative orders cannot be enforced in the courts in the absence of an express statutory provision for that purpose" was relaxed in favor of quasi-judicial agencies. In fine, it should be remembered that quasi-judicial powers will always be subject to true judicial powerthat which is held by the courts. Quasi-judicial power is defined as that power of adjudication of an administrative agency for the "formulation of a final order."22 This function applies to the actions, discretion and similar acts of public administrative officers or bodies who are required to investigate facts, or ascertain the existence of facts, hold hearings, and draw conclusions from them, as a basis for their official action and to exercise discretion of a judicial nature.23 However, administrative agencies are not considered courts, in their strict sense. The doctrine of separation of powers reposes the three great powers into its three (3) branchesthe legislative, the executive, and the judiciary. Each department is co-equal and coordinate, and supreme in its own sphere. Accordingly, the executive department may not, by its own fiat, impose the judgment of one of its agencies, upon the judiciary. Indeed, under the expanded jurisdiction of the Supreme Court, it is empowered to "determine whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government."24 Courts have an expanded role under the 1987 Constitution in the resolution of societal conflicts under the grave abuse clause of Article VIII which includes that duty to check whether the other branches of government committed an act that falls under the category of grave abuse of discretion amounting to lack or excess of jurisdiction.25 Next, petitioner cites Batas Pambansa Blg. 129 or the Judiciary Reorganization Act of 198026 where it is therein provided that the Intermediate Appellate Court (now, Court of Appeals) shall exercise the "exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards, of the Regional Trial Courts and QuasiJudicial agencies, instrumentalities, boards or commissions, except those falling within the jurisdiction of the Supreme Court in accordance with the Constitution"27 and contends that the Regional Trial Court has no jurisdiction to rule over awards made by the NHA.

NHA vs. Almeida Well-within its jurisdiction, the Court of Appeals, in its decision of August 28, 2003, already ruled that the issue of the trial court's authority to hear and decide the instant case has already been settled in the decision of the Court of Appeals dated June 26, 1989 (which has become final and executory on August 20, 1989 as per entry of judgment dated October 10, 1989).28 We find no reason to disturb this ruling. Courts are duty-bound to put an end to controversies. The system of judicial review should not be misused and abused to evade the operation of a final and executory judgment.29 The appellate court's decision becomes the law of the case which must be adhered to by the parties by reason of policy.30
Next, petitioner NHA contends that its resolution was grounded on meritorious grounds when it considered the application for the purchase of lots. Petitioner argues that it was the daughter Francisca Herrera who filed her application on the subject lot; that it considered the respective application and inquired whether she had all the qualifications and none of the disqualifications of a possible awardee. It is the position of the petitioner that private respondent possessed all the qualifications and none of the disqualifications for lot award and hence the award was not done arbitrarily. The petitioner further argues that assuming that the "Sinumpaang Salaysay" was a will, it could not bind the NHA.31 That, "insofar as [the] NHA is concerned, it is an evidence that the subject lots were indeed transferred by Margarita Herrera, the original awardee, to Francisca Herrera was then applying to purchase the same before it."32 We are not impressed. When the petitioner received the "Sinumpaang Salaysay," it should have noted that the effectivity of the said document commences at the time of death of the author of the instrument; in her words "sakaling ako'y bawian na ng Dios ng aking buhay" Hence, in such period, all the interests of the person should cease to be hers and shall be in the possession of her estate until they are transferred to her heirs by virtue of Article 774 of the Civil Code which provides that: Art. 774. Succession is a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance, of a person are transmitted through his death to another or others either by his will or by operation of law.33 By considering the document, petitioner NHA should have noted that the original applicant has already passed away. Margarita Herrera passed away on October 27, 1971.34 The NHA issued its resolution35 on February 5, 1986. The NHA gave due course to the application made by Francisca Herrera without considering that the initial applicant's death would transfer all her property, rights and obligations to the estate including whatever interest she has or may have had over the disputed properties. To the extent of the interest that the original owner had over the property, the same should go to her estate. Margarita Herrera had an interest in the property and that interest should go to her estate upon her demise so as to be able to properly distribute them later to her heirsin accordance with a will or by operation of law. The death of Margarita Herrera does not extinguish her interest over the property. Margarita Herrera had an existing Contract to Sell36 with NHA as the seller. Upon Margarita Herrera's demise, this Contract to Sell was neither nullified nor revoked. This Contract to Sell was an obligation on both partiesMargarita Herrera and NHA. Obligations are transmissible.37 Margarita Herrera's obligation to pay became transmissible at the time of her death either by will or by operation of law. If we sustain the position of the NHA that this document is not a will, then the interests of the decedent should transfer by virtue of an operation of law and not by virtue of a resolution by the NHA. For as it stands, NHA cannot make another contract to sell to other parties of a property already initially paid for by the decedent. Such would be an act contrary to the law on succession and the law on sales and obligations.38 When the original buyer died, the NHA should have considered the estate of the decedent as the next "person"39likely to stand in to fulfill the obligation to pay the rest of the purchase price. The opposition of other heirs to the repurchase by Francisca Herrera should have put the NHA on guard as to the award of the lots. Further, the Decision in the said Civil Case No. B-1263 (questioning the Deed of Self-Adjudication) which rendered the deed therein null and void40 should have alerted the NHA that there are other heirs to the interests and properties of the decedent who may claim the property after a testate or intestate proceeding is concluded. The NHA therefore acted arbitrarily in the award of the lots.

NHA vs. Almeida We need not delve into the validity of the will. The issue is for the probate court to determine. We affirm the Court of Appeals and the Regional Trial Court which noted that it has an element of testamentary disposition where (1) it devolved and transferred property; (2) the effect of which shall transpire upon the death of the instrument maker.41
IN VIEW WHEREOF, the petition of the National Housing Authority is DENIED. The decision of the Court of Appeals in CA-G.R. No. 68370 dated August 28, 2003, affirming the decision of the Regional Trial Court of San Pedro, Laguna in Civil Case No. B-2780 dated March 9, 1998, is hereby AFFIRMED. No cost. SO ORDERED.

Constantino vs. SB
Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 140656 September 13, 2007

MAYOR FELIPE K. CONSTANTINO, petitioner, vs. HON. SANDIGANBAYAN (FIRST DIVISION) and THE PEOPLE OF THE PHILIPPINES, respondents. x-----------------------------------------------------------------------------x G.R. No. 154482 September 13, 2007

NORBERTO N. LINDONG, petitioner, vs. PEOPLE OF THE PHILIPPINES and SANDIGANBAYAN, respondents. DECISION TINGA, J.: Before us are two (2) consolidated petitions, the determination of both rests ultimately on whether Felipe K. Constantino (Constantino), mayor of Malungon, Sarangani Province, was indeed guilty beyond reasonable doubt of violating Section 3(e) of Republic Act No. 3019 (R.A. No. 3019), otherwise known as The Anti-Graft and Corrupt Practices Act. In G.R. No. 140656, Constantino filed a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, assailing the 15 November 1999 decision1 and the 15 March 2000 resolution2 of the Sandiganbayan (First Division) in Criminal Case No. 23433 finding him and his co-accused, petitioner Norberto N. Lindong (Lindong) guilty beyond reasonable doubt of violating Section 3(e) of R.A. No. 3019. On the other hand, G.R. No. 154482 is a petition for certiorari with prayer for preliminary injunction under Rule 65 of the 1997 Rules of Civil Procedure, filed by Lindong questioning three (3) orders3 of the Sandiganbayan (First Division) relative to the execution of judgment against him also in Criminal Case No. 23433. The Antecedents In an Information dated 31 July 1996, Constantino, in his capacity as mayor of Malungon, Sarangani Province, together with his co-accused Lindong, was charged with violation of Section 3 (e) of R.A. No. 3019 before the Sandiganbayan, to wit: That on or about February 28, 1996, in Davao City, Philippines, and within the jurisdiction of this Honorable Court, accused Felipe K. Constantino, a public officer, being then the Mayor of the Municipality of Malungon, Sarangani Province, committing the crime herein-charged in relation to, while in the performance and taking advantage of his official functions, with evident bad faith, manifest partiality or through gross inexcusable negligence, and conspiring and confederating with accused Norberto N. Lindong, President and Chairman of the Board of the Norlovanian Corporation, Davao City, did then and there wil[l]fully, unlawfully and criminally enter into a Lease Agreement for the rental of various heavy equipments (sic) for a period of six (6) years for and in consideration of the sum of PESOS: TWO HUNDRED FIFTY-SEVEN THOUSAND ONE HUNDRED ELEVEN and 11/100 (P257,111.11) per month or a total consideration ofPESOS: EIGHTEEN MILLION FIVE HUNDRED ELEVEN THOUSAND NINE HUNDRED NINETY-NINE and92/100 (P18,511,999.92) and a guaranty deposit of PESOS: ONE MILLION SEVEN HUNDRED EIGHTY THOUSAND (P1,780,000.00) contrary to the express mandate of Resolution No. 2, series of 1995, of the Municipal Planning and

Constantino vs. SB Development Council implementing Sangguniang Bayan Resolution No. 198, series of 1995 and Sangguniang Bayan Resolution No. 21 dated February 22, 1996 authorizing the Municipal Mayor of Malungon to enter into an agreement for the purchase of heavy equipments (sic) on a five-year term basis for and in consideration of the amount of PESOS: TWO MILLION TWO HUNDRED THOUSAND (P2,200,000.00) per year or a total consideration of only PESOS: ELEVEN MILLION (P11,000,000.00), thus, giving said Norlovanian Corporation, which was fully paid for the Guaranty Deposit and was actually paid heavy equipment rentals for the period March 5 to May 6,
1996 in the aggregate sum of PESOS: TWO MILLION ONE HUNDRED SEVENTY-SEVEN THOUSAND NINETY and 91/100 (P2,177,090.91), unwarranted benefits and advantage and causing undue injury to the government. CONTRARY TO LAW.4 Both accused pleaded not guilty to the charge. In the ensuing trial, the prosecution presented Nazario B. Tomanan (Tomanan), Commission on Audit (COA) Auditor III of the COA Regional Office No. XI. In rebuttal, it presented Benjamin C. Asgapo (Asgapo), councilor of Malungon, Sarangani Province and one of the complainants below. The prosecution sought to establish the facts as follows: The Municipality of Malungon listed as one of its priority programs, the acquisition of a fleet of heavy equipment needed by the municipality in its development projects.5 For this purpose, it appropriated an amount of P2.2 Million per annum for a period of five (5) years beginning in 1996 for the amortization of such purchase.6 Pursuant thereto, the municipality conducted two (2) public biddings for suppliers of the required fleet of heavy equipment. Both attempts, however, failed. Hence, the Sangguniang Bayan instead passed Resolution No. 21 on 22 February 1996, authorizing petitioner Constantino to enter into a negotiated contract for the lease/purchase of the needed fleet of heavy equipment.7 On 28 February 1996, Constantino entered into a Lease Agreement8 with Norlovanian Corporation, represented by Lindong. The agreement required, among others, the municipality to provide Norlovanian Corporation with a guaranty deposit. The following day, Lindong appeared before the Sangguniang Bayan to discuss the Lease Agreement. Not one of the members of the Sanggunian questioned the legality of the agreement.9 The seven (7) units of heavy equipment subject of the agreement were thus delivered to the municipality on 4 March 1996.10 On 6 March 1996, the Municipality of Malungon paid Norlovanian Corporation a total amount ofP2,177,090.91 representing the guaranty deposit as well as the rental for the period of 5 March 1996 to 5 April 1996 and partial rental for the period of 5 April 1996 to 6 May 1996.11 Thereafter, on 18 April 1996, the Sangguniang Bayan unanimously passed Resolution No. 3812 requesting petitioner to operate the newly acquired fleet of heavy equipment. The municipality subsequently utilized the fleet.13 However, only five (5) days later, or on 23 April 1996, Sanggunian members Benjamin C. Asgapo, Rafael J. Suson, Sr. (Suson), Leo G. Ingay (Ingay), Pablo V. Octavio (Octavio) and Wilfredo P. Espinosa (Espinosa), and Vice Mayor Primitiva L. Espinosa (Vice Mayor Espinosa) filed a formal complaint against petitioners Constantino and Lindong for violation of R.A. No. 3019. On 6 June 1996, the Sangguniang Bayan passed Resolution No. 47, urging the municipality to "stop all forms of unauthorized payment/expenditure relative to the illegally acquired pool of heavy equipment by the Municipality of Malungon."14 In particular, Tomanan testified that he was directed by the COA Regional Office XI to conduct a special and comprehensive audit of the municipality of Malungon for the period of 1 May 1995 to 31 May 199615 in view of a complaint filed by certain officials therein. In January 1997, Tomanan submitted his report detailing the following adverse findings relative to the purchase of the subject fleet of heavy equipment: (a) the lease/purchase contract was disadvantageous to the municipal government because of the rigid terms and conditions therein required of the municipality before the latter could acquire ownership over the pool of heavy equipment; (b) Norlovanian Corporation had no proof of ownership of the fleet of equipment as the audit revealed that title to the equipment was in the name of

Constantino vs. SB Lindong; (c) the lease/purchase procedure violated Sections 27 and 28 of the Rules and Regulations on Supply and Property Management in Local Governments;16 and (d) the lease/purchase procedure utilized by the municipality was uneconomical and resulted to a wastage of P9,658,000.00 of government funds.17
Asgapo, on the other hand, testified that he was present during the 29 February 1996 meeting where Lindong appeared before the Sanggunian. The witness asserted that the lease contract was never concurred in by the municipal council as required by Resolution No. 21. He admitted, however, that neither was there any resolution passed opposing, objecting to or rejecting the lease contract. Moreover, Asgapo alleged that at the time he first obtained a copy of the lease contract from the municipal treasurer on 6 March 1996, he did not see the Undertaking dated 28 February 199618 attached or annexed thereto. He was only able to get a copy of the latter document about three (3) or four (4) days thereafter, following an inquiry with the provincial auditor.19 The defense presented Lindong as its sole witness. According to Lindong, after negotiations between himself and petitioner Constantino, together with some members of the Sanggunian, the parties agreed to a lease/purchase scheme in accordance with the mandate of Resolution No. 21. They agreed that since the municipality did not have sufficient funds to buy the fleet of heavy equipment outright at P8.9 Million, the latter would purchase the subject equipment on installment basis but with allowance for Norlovanian Corporation to recover some incremental cost. Thus, on the very same day, 28 February 1996, Lindong as representative of Norlovanian Corporation and Constantino as representative of the municipality entered into the lease/purchase agreement. They contemporaneously executed the Lease Agreement and Undertaking in the presence of the members of theSanggunian who accompanied the mayor.20 Lindong further testified that he attended the municipal council meeting on 29 February 1996 to provide the members thereof with a copy of the lease contract and to explain the transaction. Moreover, he explained that notwithstanding the fact that the main agreement was captioned only as a "Lease Agreement," the same being a standard pre-printed form of his corporation, the intent of the parties was to enter into a lease/purchase agreement. Hence, he clarified that the Undertaking he executed bound him to convey ownership over the fleet of heavy equipment to the municipality upon the full payment thereof.21 Finally, Lindong averred that more than two (2) months after he delivered the fleet of equipment to the municipality, he received a Certificate of Concurrence dated 9 May 1996 issued by Nemesio Liray, Chairman of the Committee of Finance of the Sangguniang Bayan, certifying that the Lease Agreement was concurred in by the members of the Committee on 29 February 1996. Likewise, he received a Certification dated 17 May 1996 from the Pre-Qualification, Bids and Awards Committee of the Municipality of Malungon, that the members thereof approved, concurred in and signed the contract of lease between the municipality and Norlovanian Corporation.22 Finding that the prosecution had proven beyond reasonable doubt the guilt of Constantino and Lindong of the offense as charged, the Sandiganbayan rendered the assailed decision sentencing them both, thus: WHEREFORE, judgment is hereby rendered finding accused FELIPE K. CONSTANTINO and NORBERTO N. LINDONG GUILTY beyond reasonable doubt of the crime of violation of Section 3 (e) of R.A. No. 3019, otherwise known as "The Anti-Graft and Corrupt Practices Act," and said accused are hereby sentenced, as follows: (a) to suffer an indeterminate sentence of imprisonment for a period of six (6) years and one (1) month as minimum to twelve (12) years and one (1) month as maximum; (b) to suffer perpetual disqualification from public office; (c) to jointly and severally indemnify the Municipality of Malungon, Province of Sarangani the sum of Two Million One Hundred Seventy-Seven Thousand [sic] and 91/1000 [sic] Pesos (P2,177,090.91), representing the amount actually paid to Norlovanian Corporation, with interest at the legal rate computed from March 6, 1996 until fully paid; and (d) to pay the costs of suit. SO ORDERED.23

Constantino vs. SB The Sandiganbayan held that neither manifest partiality nor evident bad faith attended the commission of the offense. However, it found that petitioner Constantino caused undue injury to the Municipality of Malungon through his gross inexcusable negligence in executing only a lease agreement over the fleet of heavy equipment. Anent Lindong, the graft court upheld his culpability as co-conspirator of Constantino despite its finding that the latter violated the anti-graft law through negligence only. The Sandiganbayan ratiocinated that since the law violated is a special law, proof that he intended to commit the particular offense was not essential, as it otherwise would have been for a felony punishable by the Revised Penal Code. The Sandiganbayan ruled that it was sufficient for the prosecution to have proven, as it did, that Lindong allowed or failed to prevent Constantino from entering into an agreement which was clearly contrary to law. Thus, even if petitioner was found guilty of causing undue injury to the municipality through gross inexcusable negligence, the anti-graft court concluded that his co-conspirator could likewise be held liable.24
It appears that during trial, both accused were represented by the same counsel. However, after judgment was rendered against them, Constantino and Lindong filed separate appeals to the Supreme Court which have taken disparate routes. On 25 April 2006, during the pendency of his present appeal, Constantino passed away.25 Lindong himself likewise filed a petition for review on certiorari, docketed as G.R. No. 142379, to seek a reversal of the Sandiganbayan decision finding him guilty as Constantinos co-conspirator. On 10 July 2000, this Court denied Lindongs petition for failure to state the material date of receipt of the assailed decision of the Sandiganbayan. His subsequent attempts for reconsideration proved futile. On 25 July 2001, the Court issued the Entry of Judgment in the case. Thereafter, the Sandiganbayan (First Division) issued three (3) orders relative to the execution of judgment against Lindong, all of which are assailed by the latter, in his petition for certiorari in G.R. No. 154482, for having been issued with grave abuse of discretion. The Sandiganbayan issued on 16 May 2002 the first challenged order which directed petitioner Lindong to appear before it in person for the execution of judgment. On 6 June 2002, the respondent court issued a resolution, the second assailed order herein, denying Lindongs urgent motion to defer execution of judgment. The third assailed order, a resolution issued on 3 July 2002, directed the issuance of a bench warrant against petitioner Lindong and the confiscation of his cash bond for provisional liberty pending appeal, and required him to surrender his person to the court and explain why judgment should not be rendered against the cash bond. With the demise of Constantino during the pendency of his appeal, the same should normally be regarded as moot and academic following the norm that the death of the accused marks the extinction of his criminal liability.26However, the present two petitions are so intertwined that the absolution of Constantino is ultimately determinative of the absolution of Lindong. Indeed, the exoneration of Constantino will necessarily signify the injustice of carrying out the penalty imposed on Lindong. Thus, the Court in this instance has to ascertain the merits of Constantinos appeal to prevent a developing miscarriage of justice against Lindong. The "moot and academic" principle is not a magical formula that can automatically dissuade the courts in resolving a case. Courts will decide cases, otherwise moot and academic, if: First, there is a grave violation of the Constitution;27 Second, the exceptional character of the situation and the paramount public interest is involved;28Third, when constitutional issue raised requires formulation of controlling principles to guide the bench, the bar, and the public;29 and Fourth, the case is capable of repetition yet evading review.30 In the instant case, the exceptional character of the appeals of Constantino and Lindong in relation to each other, as well as the higher interest of justice, requires that the Court determine the merits of the petition and not dismiss the same outright on the ground of mootness. The Ruling of the Court G.R. No. 140656 Petitioner Constantino impugned his conviction and asserted that the Sandiganbayan erred in convicting him based on its finding that he violated Resolution No. 21 by entering into a "Lease Agreement" with the Norlovanian Corporation and for his failure to sign the accompanying "Undertaking." Likewise, he argued that the evidence adduced by the prosecution was insufficient to overcome the constitutional presumption of innocence in his favor. Finally, Constantino contended that it was error for the Sandiganbayan to disregard the findings of the Supreme Court en banc in the earlier case of Constantino v. Hon. Ombudsman Desierto.31

Constantino vs. SB Constantinos petition would have been granted and he would have been absolved of criminal liability had he been still alive today. This is why it is so.
Section 3(e) of R.A. No. 3019 provides: SEC. 3. Corrupt practices of public officers. In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful: xxxx (e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage, or preference in the discharge of his official, administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence. This provision shall apply to officers and employees of offices or government corporations charged with the grant of licenses or permits or other concessions. In order to be liable for violating the law, the following elements must concur: (1) the accused is a public officer or a private person charged in conspiracy with the former; (2) he or she causes undue injury to any party, whether the government or a private party; (3) the said public officer commits the prohibited acts during the performance of his or her official duties or in relation to his or her public positions; (4) such undue injury is caused by giving unwarranted benefits, advantage or preference to such parties; and (5) the public officer has acted with manifest partiality, evident bad faith or gross inexcusable negligence.32 There are two (2) modes of committing the offense, thus: (1) the public officer caused any undue injury to any party, including the government; or (2) the public officer gave any private party unwarranted benefits, advantage or preference in the discharge of his functions.33 An accused may be charged under either mode34 or under both should both modes concur.35 Additionally, Section 3(e) poses the standard of manifest partiality, evident bad faith or gross inexcusable negligence before liability can be had under the provision. Manifest partiality is characterized by a clear, notorious or plain inclination or predilection to favor one side rather than the other.36 Evident bad faith connotes a manifest deliberate intent on the part of the accused to do wrong or cause damage.37 Gross inexcusable negligence is defined as negligence characterized by the want of even slight care, acting or omitting to act in a situation where there is a duty to act, not inadvertently but willfully and intentionally with a conscious indifference to consequences insofar as other persons may be affected.38 Mere bad faith or partiality and negligence per se are not enough for one to be held liable under the law since the act of bad faith or partiality must in the first place be evident or manifest, respectively, while the negligent deed should both be gross and inexcusable.39 As discussed previously, the Sandiganbayan held that manifest partiality could not be rightfully imputed to Constantino.40 The prosecution did not present proof that he was actuated with malice or fraud sufficient to meet the requirement of proof beyond reasonable doubt.41 However, the respondent court found that Constantinos act of entering into a purportedly pure lease agreement instead of a lease/purchase agreement was a flagrant violation of Resolution No. 21. In view of the rigid terms of the subject contract to which Constantino assented, coupled by his failure to secure the concurrence of the Sangguniang Bayan before entering into the agreement, the Sandiganbayan found that his conduct constituted gross inexcusable negligence.42 Likewise, the anti-graft court ruled that Constantinos acts resulted in undue injury to the Municipality of Malungon.43 Notably, in the course of trial, the prosecution admitted that it had no proof that unwarranted benefits and advantage had been given to Norlovanian Corporation.44 Undoubtedly, the standard of culpability imposed by Section 3 of R.A. No. 3019 is quite high which, in this case, was not hurdled by the evidence presented against Constantino. Verily, the prosecution failed to satisfy the requisite proof to demonstrate Constantinos guilt beyond reasonable doubt. While Constantino should have exercised more prudence when he transacted with Norlovanian Corporation, he could not however be held liable for "gross inexcusable negligence" as contemplated in R.A. No. 3019. Indeed, in the earlier case of Constantino v. Desierto,45 the Court had already made an express finding that petitioner Constantino did not violate the mandate of Resolution No. 21 but instead merely carried out its directive.

Constantino vs. SB That case was a special civil action for certiorari filed by Constantino to seek the invalidation of the resolution of the Ombudsman finding him guilty of grave misconduct prejudicial to the best interest of the service and/or gross neglect of duty, and on that account, dismissing him from service. The controversy arose from the same transaction entered into between Constantino and Norlovanian Corporation and involved the same subject matter as in the case at bar. The administrative complaint was initiated through a letter-complaint and joint affidavit signed by Vice Mayor Espinosa and to it was appended a certification signed by the Vice Mayor and Councilors Suson, Ingay, Asgapo, Espinosa and Octavio.
In exonerating Constantino from the administrative charges, the Court found that the evidence against him was inadequate to warrant his dismissal from service on the grounds of grave misconduct, conduct prejudicial to the best interest of the service and gross neglect of duty. More particularly, we made the following pronouncements: The explicit terms of Resolution No. 21, Series of 1996 clearly authorized Mayor Constantino to "lease/purchase one (1) fleet of heavy equipment" composed of seven (7) generally described units, through a "negotiated contract." That resolution, as observed at the outset, contained no parameters as of rate of rental, period of lease, purchase price. Pursuant thereto, Mayor Constantino, representing the Municipality of Malungon, and Norberto Lindong, representing the Norlovanian Corporation, executed two written instruments of the same date and occasion, viz.: One an agreement(on a standard printed form) dated Febr[ua]ry 28, 1996 for the lease by the corporation to the municipality of heavy equipment of the number and description required by Resolution no. 21, and Two an undertaking for the subsequent conveyance and transfer of ownership of the equipment to the municipality at the end of the term of the lease. That the Members of the Sangguniang Bayan knew of this "lease/purchase" is evident from Resolution No. 38, Series of 1996 unanimously enacted by them shortly after delivery of the equipment. In that resolution they (1) declared that "the Municipal Government ** has just acquired its fleet of heavy equipment leased/purchased from the Norlovanian Corporation," and (2) requested Mayor Constantino "to operate the newly acquired heavy equipment ** leased/purchase from the Norlovanian Corporation." The Resolution is consistent with the allegations of Mayor Constantino which in any event are not denied by the Councilors or Vice-Mayor Espinosa that: 1) the equipment was delivered to the Municipality by Norlovanian Corporation on February 28, 1996 and duly inspected by Councilors Guilley, Ruez, Nallos and Liray, as well as the Municipal Engineer and the Municipal Treasurer; 2) prior to the delivery of the units, the Vice Mayor and other Members of the Sanguniang Bayan had opportunity to read the "Lease Agreement" as well as the "Undertaking" but then raised no objections thereto; 3) neither did they raise any objections (a) at the session of the Municipal Council on February 29, 1996, when Norberto Lindong explained the terms of the "negotiated contract" of "lease/purchase," or (b) at the time that the units were delivered and inspected by designated minicipal officials. Now, it is germane to advert to the deplorable inaccuracies in the Joint Affidavit of private respondents (P.L. Espinosa, Suson, Sr., Ingay, W. P. Espinosa, Octavio, Asgapo) submitted as part of their complaint in the Ombudsmans Office. The affidavit contains a clearly distorted version of Resolution No. 21 of February 22, 1996. In that document of the affiants described Resolution No. 21 as authorizing Mayor Constantino "to purchase and acquire ** heavy equipments (sic) to be paid within five (5) years at the yearly amortization of P2.2 million **." This is a misleading reading of Resolution No. 21. As the most cursory perusal of that resolution at once discloses, what the Mayor was thereby empowered to do was "to enter into a negotiated contract" in the Municipalitys behalf with "interested parties," in line with the expressed wish of the Municipality to "lease/purchase one (1) fleet of heavy equipment **" not simply to "purchase and acquire" said equipment (as complainant Councilors aver). Neither does Resolution No. 21 state (contrary to complainants description of it) that the price shall be "paid within five (5) years at the yearly amortization of P2.2 million **;" indeed, as already above stressed, the resolution is completely silent as regards any terms and conditions of the

Constantino vs. SB "negotiated contract" that the Mayor was assigned to execute in the towns behalf. Such obvious distortions cannot but erode the complainant councilors credibility and bona fides.
It is also relevant to draw attention to the flagrantly inaccurate statements and inferences about the Mayors "negotiated contract" regarding the heavy equipment, contained in Resolution No. 47 approved only by four (4) Members of the Municipal Council at its session of June 6, 1996 (the four (4) being Councilors Octavio, Espinosa, Asgapo and Ingay). That Resolution No. 47, it will be recalled, stopped all "rental payment/expenditures relative to the pool of heavy equipment of the Norlovanian Company." The stoppage was based on prior resolutions of the Council allegedly setting down the terms under which the heavy equipment should be acquired, and which terms were supposedly violated by the Mayor. but unaccountably and again indicative of bad faith, if not malice, on the part of private respondents Resolution No. 47 made absolutely no reference to two (2) resolution which on their face justify the Mayors contract with Norlovanian Corporation, to wit: (1) Resolution No. 21 which, having been enacted after the cited resolutions, must be deemed to have superseded them, and which, to repeat, motivated and constitutes the justification for the leasepurchase agreement entered into by the Mayor and Norlovanian Corporation, and (2) Resolution No. 38 in which the Councilors not only expressly aknowledged that "the municipal government ** (had) just acquired its fleet of heavy equipment leased/purchased from the Norlovanian Corporation," but also "requested ** (the) Mayor ** to operate the newly acquired heavy equipment of the municipality leased/purchased from the Norlovanian Corporation." In light of the forego[i]ng facts, which appear to the Court to be quite apparent on the record, it is difficult to perceive how the Office of the Ombudsman could have arrived at a conclusion of any wrongdoing by the Mayor in relation to the transaction in question. It is difficult to see how the transaction between the Mayor and Norlovanian Corporation entered into pursuant to Resolution No. 21 and tacitly accepted and approved by the town Council through its Resolution No. 38 could be deemed an infringement of the same Resolution No. 21. In truth, an examination of the pertinent writings (the resolution, the two (2) instruments constituting the negotiated contract, and the certificate of delivery) unavoidably confirms their integrity and congruity. It is in fine, difficult to see how those pertinent written instrument, could establish aprima facie case to warrant the preventive suspension of Mayor Constantino. A person with the most elementary grasp of the English language would, from merely scanning those material documents, at once realize that the Mayor had done nothing but carry out the expressed wishes of the Sangguniang Bayan. xxxx The investigator also opined that Resolution No. 21 should be interpreted in light of other official documents, executed a year earlier. He [Graft Prosecutor Buena] does not explain why he did not adopt the more obvious construction of Resolution No. 21 indicated by the elementary doctrine that it is within the power and prerogative of the town council to repeal its prior acts, either expressly, or by the passage of essentially inconsistent resolutions. When the town council passed Resolution No. 21 without any mention whatever of those prior official documents respecting the acquisition to heavy equipment, the evident intention was to supersede them and to have such acquisition governed solely by Resolution No. 21. This conclusion is strongly supported by the fact that the Sanggunian expressly admitted in the Second Whereas Clause of its Resolution No. 21 that there had been a "failure of bidders to submit bids despite of two biddings ... public announcement" [sic] the two biddings being obviously related to said earlier official acts of the town council. The conclusion is further bolstered by the fact that the Council (with full awareness of said "negotiated contract,") and of the delivery of equipment thereunder, had requested the Mayor to put the equipment into operation for the town projects. The Court is thus satisfied that it was in fact the Councils intention, which it expressed in clear language, to confer on the Mayor ample discretion to execute a "negotiated contract" with any interested party, without regard to any official acts of the Council prior to Resolution No. 21. It is also difficult to see why the patent inaccuracies in the affidavit-complaint and Resolution No. 47 were ignored as difficult to understand how the execution of two writings to embody one contract of "lease/purchase" could be regarded as fatally defective, and even indicative of a criminal conspiracy, or why said two writings should be interpreted in such a way as to magnify their seeming inconsistencies. The fundamental and familiar legal principle which the Office of the Ombudsman ignored is that it is

Constantino vs. SB perfectly legitimate for a bilateral contract to be embodied in two or more separate writings, and that in such an event the writings should be read and interpreted together in such a way as to eliminate seeming inconsistencies and render the parties intention effectual.
The statement in the appealed Resolution as to the absence of prior consent of the Council to the "negotiated contract" executed by Mayor Constantino and Norlovanian Corporation flies in the teeth of the evidence; there is unrebutted proof that the heavy equipment delivered to the Municipality pursuant to the contract, was inspected by designated councilors and municipal officers; that shortly thereafter, the negotiated contract composed of two documents was explained and discussed at the session of the town Council of February 29, 1996; and that afterwards the Council requested Mayor Constantino to put the equipment into operation. (Emphasis supplied)46 Although the instant case involves a criminal charge whereas Constantino involved an administrative charge, still the findings in the latter case are binding herein because the same set of facts are the subject of both cases. What is decisive is that the issues already litigated in a final and executory judgment preclude by the principle of bar by prior judgment, an aspect of the doctrine of res judicata, and even under the doctrine of "law of the case," the re-litigation of the same issue in another action.47 It is well established that when a right or fact has been judicially tried and determined by a court of competent jurisdiction, so long as it remains unreversed, it should be conclusive upon the parties and those in privity with them.48 The dictum therein laid down became the law of the case and what was once irrevocably established as the controlling legal rule or decision continues to be binding between the same parties as long as the facts on which the decision was predicated continue to be the facts of the case before the court. Hence, the binding effect and enforceability of that dictum can no longer be resurrected anew since such issue had already been resolved and finally laid to rest, if not by the principle of res judicata, at least by conclusiveness of judgment.49 It may be true that the basis of administrative liability differs from criminal liability as the purpose of administrative proceedings on the one hand is mainly to protect the public service, based on the time-honored principle that a public office is a public trust. On the other hand, the purpose of the criminal prosecution is the punishment of crime.50 However, the dismissal by the Court of the administrative case against Constantino based on the same subject matter and after examining the same crucial evidence operates to dismiss the criminal case because of the precise finding that the act from which liability is anchored does not exist. It is likewise clear from the decision of the Court in Constantino that the level of proof required in administrative cases which is substantial evidence was not mustered therein. The same evidence is again before the Court in connection with the appeal in the criminal case. Ineluctably, the same evidence cannot with greater reason satisfy the higher standard in criminal cases such as the present case which is evidence beyond reasonable doubt. The elementary principle is that it is perfectly legitimate for a bilateral contract to be embodied in two or more separate writings, and that in such an event the writings should be read and interpreted together in such a way as to eliminate seeming inconsistencies and render the intention of the parties effectual.51 In construing a written contract, the reason behind and the circumstances surrounding its execution are of paramount importance to place the interpreter in the situation occupied by the parties concerned at the time the writing was executed.52Construction of the terms of a contract, which would amount to impairment or loss of right, is not favored. Conservation and preservation, not waiver, abandonment or forfeiture of a right, is the rule.53 In case of doubts in contracts, the same should be settled in favor of the greatest reciprocity of interests.54 G.R. No. 154482 Lindong ascribes grave abuse of discretion on the part of respondent court in issuing the challenged orders. He argues that the Sandiganbayan erred in not holding in abeyance the execution of judgment against him in light of the pending petition for review by his co-accused before this Court of the same decision for which he was convicted. Should the decision be set aside by the Supreme Court, petitioner Lindong contends, he will be benefited to the extent that there can no longer be any judgment to legally execute against both himself and Constantino. The virtual acquittal of Constantino inevitably puts a welcome end to the tribulations of Lindong. Thus, we grant the petition.

Constantino vs. SB One of the essential elements for violating Section 3(e) of R.A. No. 3019 is that the respondent is a public officer discharging administrative, judicial or official functions, or that he or she is a private individual in conspiracy with such public officer. In the instant case, the essential acquittal of Constantino, as presaged in G.R. No. 140656 and presented in the disquisition, renders an absence in the critical requisite of a public officer with whom Lindong, the private individual, allegedly conspired to commit the crime charged.
Hence, we now have before us an incongruous situation where execution of judgment has been entered against a private person accused with conspiring with a public officer for violation of the anti-graft law, but at the same time said public officer would unequivocably be entitled to exoneration had he not died in the meantime. Yet, it is utterly illogical to absolve Constantino who entered into the contract on behalf of the government and send the private person to prison. The case of Marcos v. Sandiganbayan (1st Division)55 is instructive. Here, the Court granted the motion for reconsideration filed by former First Lady Imelda Marcos and acquitted her of the charge of violating Section 3(g) of R.A. No. 3019. Her acquittal was based on the finding that she signed the subject lease agreement not as a public officer, but as a private person. Thus, the Court found that the first element of the offense, i.e., that the accused is a public officer, was lacking. However, the acquittal of the former First Lady was taken in conjunction with the acquittal of the public officer with whom she was accused.56 The case of Go v. The Fifth Division, Sandiganbayan, et al.57 further elucidates the matter as illustrated inMarcos, to wit: x x x [T]he acquittal of the former First Lady should be taken in the context of the Courts Decision dated January 29, 1198, in Dans, Jr. v. People, which the former First Lady sought to reconsider and, finding merit in her motion, gave rise to the Courts Resolution in Marcos. In Dans, the Information filed against the former First Lady and Jose P. Dans, Jr., then Minister of Transportation and Communications, for violation of Section 3(g) of R[.]A[.] [No.] 3019, alleged that they were both public officers and, conspiring with each other, entered into the subject lease agreement covering the LRTA property with the PGHFI, a private entity, under terms and conditions manifestly and grossly disadvantageous to the government. The Court in its original decision affirmed the former First Ladys conviction for violation of Section 3(g) of R[.]A[.] [No.] 3019 but acquitted her co-accused, Dans, Jr., of the said offense. As stated earlier, upon the former First Ladys motion for reconsideration, the Court reversed her conviction in its Resolution in Marcos. It can be gleaned from the entire context of Marcos and Dans that the reversal of the former First Ladys conviction was based on the fact that it was later held that she signed the subject lease agreement as a private person, not a public officer. However, this acquittal should also be taken in conjunction with the fact that the public officer with whom she had supposedly conspired, her co-accused Dans, had earlier been acquitted. In other words, the element that the accused is a public officer, was totally wanting in the former First Ladys case because Dans, the public officer with whom she had allegedly conspired in committing Section 3(g) of R[.]A[.] [No.] 3019, had already been acquitted. Obviously, the former First Lady could not be convicted, on her own as a private person, of the same offense. (Emphasis supplied) It is therefore apparent that in light of the prevailing milieu in the instant case, we cannot sustain the execution of judgment against Lindong. The reversal of the decision of the Sandiganbayan in Criminal Case No. 23433 makes it legally absurd to execute any such judgment against him. Moreover, Rule 122, Section 11(a) of the Revised Rules of Criminal Procedure operates in his favor. The Rule provides: SEC. 11. Effect of appeal by any of several accused. (a) An appeal taken by one or more of several accused shall not affect those who did not appeal, except insofar as the judgment of the appellate court is favorable and applicable to the latter. Although the rule states that a favorable judgment shall benefit those who did not appeal, we have held that a literal interpretation of the phrase "did not appeal" will not give justice to the purpose of the provision. It should be read in its

Constantino vs. SB entirety and should not be myopically construed so as to defeat its reason, i.e., to benefit an accused who did not join in the appeal of his co-accused in case where the appellate judgment is favorable.58
In fact, the Court has at various times applied the foregoing provision without regard to the filing or non-filing of an appeal by a co-accused, so long as the judgment was favorable to him. In such cases, the co-accused already withdrew his appeal,59 failed to file an appellants brief,60 or filed a notice of appeal with the trial court but eventually withdrew the same.61 Even more, in these cases, all the accused appealed from the judgment of conviction but for one reason or another, their conviction had already become final and executory. Nevertheless, the Court still applied to them the favorable judgment in favor of their co-accused.62 Therefore, we cannot find a reason to treat Lindong differently, especially so in this case where the public officer accused of violating the anti-graft law has been acquitted, and the appeal by Lindong was dismissed on a technicality. WHEREFORE, the petition in G.R. No. 140656, although meritorious, is DENIED on the ground of mootness. The petition in G.R. No. 154482 is GRANTED. The challenged orders of the Sandiganbayan in Criminal Case No. 23433 are NULLIFIED and SET ASIDE. The Sandiganbayan is permanently enjoined from executing said orders. SO ORDERED.

Magallanes vs Sun Yat Sen Elementary School

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 160876 January 18, 2008

AZUCENA MAGALLANES, EVELYN BACOLOD and HEIRS OF JUDITH COTECSON, petitioners, vs. SUN YAT SEN ELEMENTARY SCHOOL, PAZ GO, ELENA CUBILLAN, WILLY ANG GAN TENG, BENITO ANG, and TEOTIMO TAN, respondents. DECISION SANDOVAL-GUTIERREZ, J.: For our resolution is the instant Petition for Review on Certiorari seeking to reverse the Resolution of the Court of Appeals (Seventh Division) dated October 29, 2001 in CA-G.R. SP No. 67068; its Resolution of May 8, 2003 denying the motion for reconsideration; and its Resolution of October 10, 2003, denying the motion for reconsideration of the Resolution of May 8, 2003. The facts of the case are: Azucena Magallanes, Evelyn Bacolod, Judith Cotecson (represented by her heirs), petitioners, Grace Gonzales, and Bella Gonzales were all employed as teachers in the Sun Yat Sen Elementary School in Surigao City. Paz Go and Elena Cubillan are principals of the said school. Willy Ang Gan Teng and Benito Ang are its directors, while Teotimo Tan is the school treasurer. They are all respondents herein. On May 22, 1994, respondents terminated the services of petitioners. Thus, on August 3, 1994, they filed with the SubRegional Arbitration Branch No. X, National Labor Relations Commission (NLRC), Butuan City, complaints against respondents for illegal dismissal, underpayment of wages, payment of backwages, 13th month pay, ECOLA, separation pay, moral damages, and attorneys fees. Likewise, on August 22, 1994, petitioner Cotecson filed a separate complaint praying for the same reliefs. On June 3, 1995, Labor Arbiter Rogelio P. Legaspi rendered a Decision declaring that petitioners were illegally dismissed from the service and ordering respondents to reinstate them to their former or equivalent positions without loss of seniority rights, and to pay them their backwages, salary differential, 13th month pay differential, and service incentive leave benefits "as of June 20, 1995." Respondents were likewise directed to pay petitioners moral and exemplary damages. On appeal by respondents, the NLRC, in its Decision dated February 20, 1996, reversed the Arbiters judgment, holding that petitioners are contractual employees and that respondents merely allowed their contracts to lapse. Petitioners timely filed a motion for reconsideration, but it was denied by the NLRC in its Resolution dated April 17, 1996. Petitioners then filed with the Court of Appeals a petition for certiorari, docketed as CA-G.R. SP No. 50531. On October 28, 1999, the Court of Appeals (Special Sixteenth Division) rendered its Decision,1 the dispositive portion of which reads:

Magallanes vs Sun Yat Sen Elementary School WHEREFORE, the instant petition is GRANTED with respect to petitioners Cotecson, Bacolod, and Magallanes, the questioned Resolutions of the NLRC dated February 20 and April 1996 are hereby REVERSED and SET ASIDE as to them.
The Decision dated July 3, 1995 of the Labor Arbiter is hereby REINSTATED as to the said petitioners except as to the award of moral and exemplary damages which is hereby DELETED. SO ORDERED. The Court of Appeals (Special Sixteenth Division) ruled that in lieu of reinstatement, petitioners Cotecson, Bacolod, and Magallanes "shall be entitled to separation pay equivalent to one month salary and backwages computed from the time of their illegal dismissal up to the time of the promulgation of its Decision." With respect to Bella Gonzales and Grace Gonzales, the Court of Appeals found that that they have not acquired the status of regular employees having rendered only two years of service. Consequently, their dismissal from the service is valid. Under the Manual of Regulations for Private Schools, only full-time teachers who have rendered three (3) years of consecutive service shall be considered permanent. Respondents filed a motion for reconsideration but it was denied by the appellate court in its Resolution dated January 13, 2000. Respondents then filed with this Court a petition for certiorari, docketed as G.R. No. 142270. However, it was dismissed for lack of merit in a Minute Resolution dated April 12, 2000. Their motion for reconsideration was denied with finality by this Court on July 19, 2000. Meanwhile, on October 4, 2000, petitioners filed with the Labor Arbiter a motion for execution of his Decision as modified by the Court of Appeals. In an Order dated January 8, 2001, the Labor Arbiter computed the petitioners monetary awards reckoned from the time of their illegal dismissal in June 1994 up to October 29, 1999, pursuant to the Decision of the Court of Appeals (Special Sixteenth Division) in CA-G.R. SP No. 50531. Respondents interposed an appeal to the NLRC (docketed as NLRC Case No. M-006176-2001), contending that the computation should only be up to June 20, 1995 (the date indicated in the Labor Arbiters Decision). In an Order dated March 30, 2001, the NLRC modified the Labor Arbiters computation and ruled that the monetary awards due to petitioners should be computed from June 1994 up to June 20, 1995. Petitioners then filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 67068, raffled off to the Seventh Division. However, in its Resolution of October 29, 2001, the petition was dismissed outright for their failure to attach to their petition copies of the pleadings filed with the Labor Arbiter, thus: No copies of the pleadings filed before the Labor Arbiter appear to have been attached to the petition in violation of the provisions of Section 1, Rule 65 and Section 3, Rule 46 of the 1997 Rules of Civil Procedure, as amended, which requires that the petition: x x x shall be accompanied by a clearly legible duplicate original or certified true copy of the judgment, order, resolution or ruling subject thereof, such material portions of the record as are referred to therein and other documents relevant or pertinent thereto x x x WHEREFORE, the instant petition is DISMISSED OUTRIGHT pursuant to Section 3, Rule 46 of the 1997 Rules of Civil Procedure. SO ORDERED. Petitioners filed a motion for reconsideration, but they erroneously indicated therein the case number as CA-G.R. SP No. 50531, instead of CA-G.R. SP No. 67068. Their error was compounded by stating that the petition was with the

Magallanes vs Sun Yat Sen Elementary School Special Sixteenth Division, instead of the Seventh Division. As a result, the Special Sixteenth Division issued a Minute Resolution dated April 22, 2002 which merely noted the motion, thus:
The petitioners motion for reconsideration dated November 22, 2001 and filed by registered mail on November 26, 2001 is merely noted since there was no October 29, 2001 resolution that was issued in this case which the motion for reconsideration seeks to be reconsidered. On realizing their mistake, petitioners then filed with the Seventh Division a Motion to Transfer The Case to it. In a Resolution promulgated on May 8, 2003, the Seventh Division denied petitioners Motion To Transfer The Case on the ground, among others, that the motion is "non-existent" since it does not bear the correct case number, hence, could not be attached to the records of CA-G.R. SP No. 67068. Unfazed, petitioners filed a motion for reconsideration, but it was denied by the Seventh Division in its Resolution of October 10, 2003. At first glance, the petition before us appears to be a futile attempt to revive an extinct motion denied by the appellate court (Seventh Division) by reason of technicality. But in the interest of speedy administration of justice, we should not only delve in technicalities. We shall then address these two issues: (1) whether the Court of Appeals (Seventh Division) erred in holding that affixing a wrong docket number on a motion renders it "non-existent;" and (2) whether the issuance by the NLRC of the Order dated March 30, 2001, amending the amounts of separation pay and backwages, awarded by the Court of Appeals (Sixteenth Division) to petitioners and computed by the Labor Arbiter, is tantamount to grave abuse of discretion amounting to lack or excess of jurisdiction. On the first issue, the Court of Appeals (Seventh Division) is correct when it ruled that petitioners motion for reconsideration of its Resolution dated October 29, 2001 in CA-G.R. SP No. 67068 is "non-existent." Petitioners counsel placed a wrong case number in their motion, indicating CA-G.R. SP No. 50531 (Special Sixteenth Division) instead of CA-G.R. SP No. 50531 (Seventh Division), the correct case number. In Llantero v. Court of Appeals,2we ruled that where a pleading bears an erroneous docket number and thus "could not be attached to the correct case," the said pleading is, for all intents and purposes, "non-existent." As aptly stated by the Special Sixteenth Division, it has neither the duty nor the obligation to correct the error or to transfer the case to the Seventh Division. In Mega Land Resources and Development Corporation v. C-E Construction Corporation,3 which likewise involves a wrong docket number in a motion, we ruled that the duty to correct the mistake falls solely on the party litigant whose fault caused the anomaly. To hold otherwise would be to impose upon appellate courts the burden of being nannies to appellants, ensuring the absence of pitfalls that hinder the perfection of petitions and appeals. Strictly speaking, it is a dogma that the mistake or negligence of counsel binds the clients4 and appellate courts have no share in that burden. However, we opt for liberality in the application of the rules to the instant case in light of the following considerations. First, the rule that negligence of counsel binds the client may be relaxed where adherence thereto would result in outright deprivation of the clients liberty or property or where the interests of justice so require.5Second, this Court is not a slave of technical rules, shorn of judicial discretion in rendering justice, it is guided by the norm that on the balance, technicalities take a backseat against substantive rights. Thus, if the application of the rules would tend to frustrate rather than promote justice, it is always within this Courts power to suspend the rules or except a particular case from its application.6 This case involving a labor dispute has dragged on for over a decade now. Petitioners have waited too long for what is due them under the law. One of the original petitioners, Judith Cotecson, died last September 28, 2003 and has been substituted by her heirs. It is time to write finis to this controversy. The Labor Code was promulgated to promote the welfare and well-being of the working man. Its spirit and intent mandate the speedy administration of justice, with least attention to technicalities but without sacrificing the fundamental requisites of due process.7 We recall that in CA-G.R. SP No. 50531, the Court of Appeals (Special Sixteenth Division) held that petitioners Cotecson, Bacolod, and Magallanes "shall be entitled to separation pay equivalent to one month salary and backwages computed from the time of their illegal dismissal up to the time of the promulgation of this decision." This Decision was promulgated on October 28, 1999. The respondents motion for reconsideration was denied by the Court of Appeals (Former Special Sixteenth Division) on January 13, 2000. On April 12, 2000, this Court

Magallanes vs Sun Yat Sen Elementary School dismissed respondents petition for certiorari, docketed as G.R. No. 142270, and denied their motion for reconsideration with finality as early as July 19, 2000.
Clearly, the Decision in CA-G.R. SP No. 50531 had long become final and executory. The Labor Arbiter computed the monetary awards due to petitioners corresponding to the period from June 1994 to October 28, 1999, in accordance with the Decision of the Court of Appeals (Special Sixteenth Division). The award for backwages and money claims is in the total sum of P912,086.15. It does not escape our attention that upon respondents appeal from the Labor Arbiters Order computing the benefits due to petitioners, the NLRC modified the final and executory Decision of the Court of Appeals (Special Sixteenth Division) when it decreed that the monetary award due to petitioners should be computed up to June 20, 1995 only (not October 28, 1999), thus, amounting to a lesser amount ofP147,673.16. We sustain petitioners contention that the NLRC, in modifying the award of the Court of Appeals, committed grave abuse of discretion amounting to lack or excess of jurisdiction. Quasi-judicial agencies have neither business nor power to modify or amend the final and executory Decisions of the appellate courts. Under the principle of immutability of judgments, any alteration or amendment which substantially affects a final and executory judgment is void for lack of jurisdiction.8 We thus rule that the Order dated March 30, 2001 of the NLRC directing that the monetary award should be computed from June 1994, the date petitioners were dismissed from the service, up to June 20, 1995 only, is void. WHEREFORE, we GRANT the petition. The challenged Resolutions dated October 29, 2001, May 8, 2003, and October 10, 2003 in CA-G.R. SP No. 67068 are REVERSED. The Order of the NLRC dated March 30, 2001 in NLRC Case No. M-006176-2001 is SET ASIDE. The Order of the Labor Arbiter dated January 8, 2001 isREINSTATED. SO ORDERED.

Holy Spirit Homeowners Association vs. Defensor

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 146061 August 31, 2006 SUMALO HOMEOWNERS ASSOCIATION OF HERMOSA, BATAAN, Petitioner, vs. JAMES T. LITTON, EMMA L. LAPERAL, GLORIA L. DEL RIO, GEORGE T. LITTON, JR., GRACE L. GALLEGO and the HEIRS OF EDWARD T. LITTON, Respondents. DECISION YNARES-SANTIAGO, J.: Assailed in this Petition for Review on certiorari is the June 16, 2000 Decision1 of the Court of Appeals in CA-G.R. SP No. 52014 reversing the Resolution of the Office of the President dated September 4, 1998 (Zamora Resolution) and reinstating the Resolution dated June 16, 1997 (Torres Resolution), as well as the October 23, 2000 Resolution2 denying the motion for reconsideration. The factual antecedents are as follows: On August 16, 1989, respondents filed with the Department of Agrarian Reform (DAR) a voluntary offer to sell (VOS) their property located in Bgy. Sumalo, Hermosa, Bataan, consisting of three contiguous parcels of land, with an aggregate area of 213.6189 hectares and covered by Transfer Certificate of Title (TCT) Nos. 80135, 80136, 80137.3 On August 26, 1991, the DAR Region III Office issued a Notice of Acquisition4 informing the respondents that the DAR will only acquire 42.4034 hectares of the property. Thereafter, on July 6, 1993, the Provincial Agrarian Reform Officer (PARO) informed the respondents that DAR would acquire 45.3789 hectares at P1.17 per square meter or a total purchase price of P529,414.68. Notwithstanding receipt of the DARs offer of purchase, respondent withdrew their VOS and applied for the conversion of the property from agricultural use to industrial, commercial and residential uses. Respondents opted for conversion due to the enactment of Republic Act (R.A.) No. 7227 or The Bases Conversion and Development Act of 1992,5 providing for the creation of a Special Economic and Free Port Zone in an area consisting of Olongapo City, Subic in Zambales and parts of the municipalities of Morong and Hermosa in the Province of Bataan, and the declaration by the Sangguniang Bayan of Hermosa and the Sangguniang Panlalawigan of Bataan that the Hermosa Agro-Industrial Estate, a property contiguous to the land of the respondents, is an industrial area.6 Likewise, the Department of Agriculture (DA) has determined that respondents property is not economically suitable for agricultural production7 and that there is no tenurial relationship between them and the occupants of the property. The respondents further alleged that the construction of light structures in the areas adjacent to their property, as well as the proposed Subic Bay Metropolitan Authority (SBMA) National Highway thru their property warrant the application for reclassification. On May 14, 1996, DAR Secretary Ernesto D. Garilao denied8 respondents application for conversion of the property. The motion for reconsideration was likewise denied on September 18, 1996, hence respondents appealed to the Office of the President docketed as O.P. Case No. 97-A-7020. During the pendency of O.P. Case No. 97-A-7020, the Sangguniang Bayan of Hermosa, Bataan issued Ordinance No. 96004 reclassifying the area which includes the subject properties from agricultural to industrial zone. On June 16, 1997, the Office of the President, through Executive Secretary Ruben D. Torres issued a Resolution9disposing respondents appeal as follows:

Holy Spirit Homeowners Association vs. Defensor WHEREFORE, pursuant to the spirit and intent of RA No. 6557, the Orders dated 14 May 1996 and 18 September 1996 by the Honorable Secretary of Agrarian Reform, are hereby SET ASIDE. Accordingly, the application for conversion of the entire 213.6819 hectare property of the applicants-appellants located at Bgy. Sumalo, Hermosa, Bataan is hereby APPROVED.
SO ORDERED.10 Aggrieved by the issuance of the Torres Resolution, the petitioners sought a reconsideration of the same. The Office of the President, this time represented by Executive Secretary Ronaldo B. Zamora, issued on September 4, 1998 a Resolution11 giving due course to the motion for reconsideration of the petitioners. The dispositive portion of the Zamora Resolution reads: WHEREFORE, the instant motion for reconsideration is hereby given due course, and the Resolution of this Office dated June 16, 1997 is hereby REVERSED. The orders of the Secretary of Agrarian Reform dated May 14, 1996 and September 18, 1996, are hereby REINSTATED. SO ORDERED.12 Respondents appealed by way of a petition for review13 under Rule 43 of the Rules of Court with the Court of Appeals which rendered the assailed decision which reads: WHEREFORE, the OP Resolution dated September 4, 1998 (Zamora Resolution) is hereby REVERSED and SET ASIDE, and the OP Resolution dated June 16, 1997 (Torres Resolution) is REINSTATED. SO ORDERED.14 Petitioners motion for reconsideration was denied15 hence the present petition raising the following issues: WHETHER THE COURT OF APPEALS CORRECTLY HELD THAT THE PETITIONERS ARE NOT REAL PARTIES IN INTEREST TO THE CASE. WHETHER THE COURT OF APPEALS CORRECTLY ANCHORED ITS ASSAILED DECISION ON THE CASE OFFORTICH v. CORONA. In the case of Fortich v. Corona,16 the Office of the President issued on March 29, 1996 through Executive Secretary Ruben D. Torres a resolution approving the conversion of 144-hectare land from agricultural to agroindustrial/institutional area. The decision was met with vehement opposition by some alleged farmer beneficiaries which culminated in a dramatic and well publicized hunger strike that caught nationwide attention. This led to the issuance by the Office of the President, through then Deputy Executive Secretary Renato C. Corona, of the so-called "Win-Win" Resolution on November 7, 1997 substantially modifying the decision rendered by Executive Secretary Torres after it had already become final and executory. The "Win-Win" Resolution approved the conversion to agro-industrial area only to the extent of 44 hectares, and ordered the remaining 100 hectares to be distributed to qualified farmer beneficiaries. Aggrieved by the issuance of the "Win-Win" Resolution, the petitioners are now before us in a special civil action for certiorari and prohibition. Finding merit in the contentions raised by the petitioners, we ruled that the "Win-Win" Resolution which substantially modified the March 29, 1996 Decision after it has attained finality, is void.17 As regards the standing of the purported farmer-beneficiaries who sought to intervene in the said case the recognized rule in this jurisdiction is that a real party in interest is a party who would be benefited or injured by the judgment or is the party entitled to the avails of the suit.18 Interest within the meaning of the rule means material interest, an interest in issue and to be affected by the decree, as distinguished from mere interest in the question involved, or a more incidental interest.19 Real Interest means a present substantial interest, as distinguished from a mere expectancy or a future, contingent, subordinate or consequential interest.20

Holy Spirit Homeowners Association vs. Defensor The petitioners in the instant case claim that they have been identified as qualified beneficiaries of the Litton property under the Comprehensive Agrarian Reform Program (CARP) citing Section 22 of R.A. No. 6657 or theComprehensive Agrarian Reform Law of 1988 (CARL):21
SEC. 22. Qualified Beneficiaries. The lands covered by the CARP shall be distributed as much as possible to landless residents of the same barangay, or in the absence thereof, landless residents of the same municipality in the following order of priority:

(a) agricultural lessees and share tenants; (b) regular farm workers; (c) seasonal farm workers; (d) other farm workers; (e) actual tillers or occupants of public lands; (f) collective or cooperatives of the above beneficiaries; and (g) others directly working on the land. Petitioners claim that while they may not qualify either as agricultural lessees, share tenants, regular farm workers, seasonal farm workers, or as actual tillers or occupants of public lands, they allegedly fall within the ambit of the definition of "other farm workers", "collective or cooperative of the above beneficiaries", and "others directly working on the land". They claim that in the absence of lessees, tenants, farm workers or actual tillers, those directly working on the land become qualified as beneficiaries. They also allege that they have been working on the Litton property for a long time. The petition lacks merit. The claim that they have been working on the Litton property as farm workers is contradicted by the Ocular Inspection Report22 prepared by the DA Region III Office. The report not only recommended that the Litton property is best suited for purposes other than agricultural production, it also observed that the only notable developments on the property are residential houses, roads and recreational facilities. The ocular inspection report did not mention any agricultural developments to support the contention of the petitioners that they have been actually working on the land. If petitioners have indeed worked on Litton property for some time, the fruits of such endeavor should have been manifest and easily noticed by the DA representatives who conducted the ocular inspection. Moreover, the December 14, 1994 certification23 of the Municipal Agrarian Reform Office (MAR) of Hermosa, Bataan stated that the subject properties are untenanted. Further, in the Certification24 issued on May 2, 1994, the DA Region III Office observed that 60% of the Litton Property is under shubland/grassland and the remaining 40% is utilized for residential, institutional, roads, orchard and sporadic small areas cultivated to vegetables. The issuance of these public documents carry with it the presumption of regularity which we cannot disregard in the absence of evidence to the contrary.25 Petitioners also failed to substantiate the claim that they have been identified as qualified beneficiaries of the Litton property under the CARP. The CARL is specific in its requirements for registering qualified beneficiaries: SEC. 15. The DAR in coordination with the Barangay Agrarian Reform Committee (BARC) as organized in this Act, shall register all agricultural lessees, tenants and farm workers who are qualified to be beneficiaries with the assistance of the BARC and the DAR shall provide the following data:
Registr ation of Benefici aries .

a) Names and members of their immediate farm household;

Holy Spirit Homeowners Association vs. Defensor b) Location and area of the land they work;
c) Crops planted; and d) Their share in the harvest or amount of rental paid or wages received. A copy of the registry or list of all potential CARP beneficiaries in the barangay shall be posted in the barangay hall, school or other public buildings in the barangay where it shall be open to inspection by the public at all reasonable hours. Aside from their self-serving assertions, the records is devoid of proof that the petitioners have been identified and registered as qualified beneficiaries. The findings of the Torres Resolution are quite revealing: The thriving farming community adverted to by the Honorable DAR Secretary in his Order is in reality not composed of tenants of the Littons but mere occupants of homelots without their consent, who use the property primarily for residential purposes and commercial activities and who have been subject of ejectment suits by the Littons. We find the opposition raised by the Sumalo Homeowners Association to the application for conversion to be bereft of substance. It appears that the oppositors are not farmers-tillers but occupants of homelots and are the same defendants in the ejectment suit. x x x.26 From the foregoing, it is clear that petitioners, whose claim of being qualified beneficiaries is self-serving and bereft of basis, are not real parties in interest in this case. As held in Fortich v. Corona:27 With respect to the motion for reconsideration filed by the applicants for intervention, we likewise find the same unmeritorious. The issue of the applicants right to intervene in this proceedings should be laid to rest. The rule in this jurisdiction is that a party who wishes to intervene must have a "certain right" or "legal interest" in the subject matter of the litigation. Such interest must be "actual, substantial, material, direct and immediate, and not simply contingent and expectant." Here, the applicants for intervention categorically admitted that they were not tenants x x x but were merely seasonal farmworkers in a pineapple plantation on the subject land which was under lease for ten (10) years to the Philippine Packing Corporation. Respondent, then DAR Secretary Ernesto Garilao, also admitted in his Order of June 7, 1995 that "the subject land is neither tenanted nor validly covered for compulsory acquisition x x x." Under Section 4, Article XIII of the 1987 Constitution, the right to own directly or collectively the land they till belongs to the farmers and regular farmworkers who are landless, and in the case of other farmworkers, the latter are entitled to receive a just share of the fruits" of the land. The pertinent portion of the aforecited constitutional provision mandates: Sec. 4. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or in the case of other farmworkers, to receive a just share of the fruits thereof. x x x. (Emphasis supplied) Commenting on the above-quoted provision, the eminent constitutionalist, Fr. Joaquin G. Bernas, S.J., one of the framers of the 1987 Constitution, declares that under the agrarian reform program the equitable distribution of the land is a right given to landless farmers and regular farmworkers to own the land they till, while the other orseasonal farmworkers are only entitled to a just share of the fruits of the land. Thus, the Court of Appeals correctly found that petitioners in the instant case are not real parties in interest, to wit: In the case at bench, the members of respondent Sumalo make no pretense that they are agricultural lessees or tenants or employees or laborers in an agricultural enterprise or farm of the petitioners, for the latter have none, much less are they (Sumalo members) the owners of the subject property. In their protest to the petitioners application for conversion they merely averred "clearing, tilling and planting the land under claim of ownership." But the fact is that the parcels of land are titled in the names of the petitioners.

Holy Spirit Homeowners Association vs. Defensor Accordingly, the members of Sumalo can never be considered as farmers or farmworkers, much less regular farmworkers, under the Comprehensive Agrarian Reform Law as conceived in the Constitution. Then DAR Secretary Ernesto P. Garilao, in his Order denying the [respondents] conversion application, described the members of Sumalo as mere "occupants of the subject area" and never as farmers or farmworkers. They are, therefore completely wanting of the actual, substantial, material, direct and immediate and not simply contingent and expectant," interest that would qualify them as a real party in interest under the standard set forth in the Fortich case. x x x.28
Since petitioners failed to establish their standing as real parties in interest, they have no personality to assail the Torres Resolution. As earlier stated, the Torres Resolution allowing the conversion of the Litton property was rendered on June 16, 1997. DAR Secretary Garilao received a copy of the Torres Resolution on June 18, 1997. He did not file a motion for reconsideration nor did he appeal. Thereafter, on September 17, 1997, petitioners interposed a motion for reconsideration. On October 28, 1997, the DAR Secretary manifested that it was adopting the motion for reconsideration interposed by the petitioners.29 Administrative Order No. 18, Series of 1987, prescribes the rules and regulations governing appeals to the Office of the President. Section 7 of the said issuance provides: SEC. 7. Decisions/resolutions/orders of the Office of the President shall, except as otherwise provided for by special laws, become final after the lapse of fifteen (15) days from receipt of a copy thereof by the parties, unless a motion for reconsideration thereof is filed within such period.30 Under Executive Order No. 292, The Administrative Code of 1987, the decision of an agency shall become final and executory 15 days after the receipt of a copy thereof by the party adversely affected unless within that period an administrative appeal or judicial review, if proper, has been perfected. One motion for reconsideration may be filed, which shall suspend the running of the period.31 The Torres Resolution was received by DAR Secretary Garilao on June 18, 1997. On September 17, 1997, petitioners filed a motion for reconsideration. On October 28, 1997, or 132 days after receipt of the Torres Resolution, DAR Secretary Garilao filed a manifestation adopting the petitioners motion for reconsideration. Clearly the Torres Resolution has already become final and executory by the time petitioners filed the motion for reconsideration, assuming they have the legal standing to file the same. Petitioners argue they were belatedly served a copy of the Torres Resolution, hence they cannot be faulted for filing a late motion for reconsideration. We examined the records of this case and we found no evidence to support the contention that petitioners were belatedly served a copy of the Torres Resolution. No document in the records exists to prove that petitioners received a copy of the Torres Resolution 15 days prior to the filing of their motion for reconsideration on September 17, 1997. Since the motion for reconsideration of the petitioners cannot be considered to have been timely filed by a real party in interest, it never tolled the running of the 15-day period within which to file a motion for reconsideration or an appeal. As such, the Torres Resolution had attained finality when petitioners filed their motion for reconsideration. Thus, the Zamora Resolution which reversed the Torres Resolution which is already final and executory was issued in disregard of the rules and basic legal precept that accord finality to administrative determinations. The orderly administration of justice requires that the judgments/resolutions of a court or quasi judicial body must reach a point of finality set by the law, rules and regulations. The noble purpose is to write finis to disputes once and for all. This is a fundamental principle in our justice system, without which there could be no end to litigations. Utmost respect and adherence to this principle must always be maintained by those who wield the power of adjudication. Any act which violates such principle must be struck down.32 Procedural rules should be treated with utmost respect and due regard since they are designed to facilitate the adjudication of cases to remedy the worsening problem of delay in the resolution of rival claims and in the administration of justice. The requirement is in pursuance to the bill of rights inscribed in the Constitution which guarantees that "all person shall have a right to the speedy disposition of their cases before all judicial, quasi-judicial and administrative bodies" The adjudicatory bodies and the parties to a case are thus enjoined to abide strictly by the rules.33

Holy Spirit Homeowners Association vs. Defensor In fine, the Court of Appeals correctly reversed the Zamora Resolution because it was issued in excess of jurisdiction and in violation of the fundamental and time-honored principle of finality to administrative determinations.34 The Torres Resolution has become final and executory hence can no longer be altered or modified.
WHEREFORE, the petition is DENIED.The June 16, 2000 Decision of the Court of Appeals in CA-G.R. SP No. 52014 reversing the Resolution of the Office of the President dated September 4, 1998 (Zamora Resolution) and reinstating the Resolution dated June 16, 1997 (Torres Resolution) and its October 23, 2000 Resolution denying the motion for reconsideration, are AFFIRMED. No pronouncement as to costs. SO ORDERED.

Ruivivar vs. OMB

SECOND DIVISION [G.R. No. 165012, September 16, 2008] RACHEL BEATRIZ RUIVIVAR, PETITIONER, VS. OFFICE OF THE OMBUDSMAN AND DR. CONNIE BERNARDO, RESPONDENTS. DECISION
BRION, J.: Before us is the petition for review on certiorari under Rule 45 of the Rules of Court commenced by Rachel Beatriz Ruivivar (petitioner). It seeks to set aside:
(a) the Decision of the Court of Appeals (CA)[1] dated May 26, 2004[2] dismissing the petition forcertiorari filed by the petitioner and affirming the Decision dated November 4, 2002[3] (November 4, 2002 Decision) and the Order dated February 12, 2003[4] (February 12, 2003 Order) of the Office of the Ombudsman (Ombudsman); the Ombudsman's Decision and Order found the petitioner administratively liable for discourtesy in the course of official duties as Chairperson of the Land Transportation Office (LTO) Accreditation Committee on Drug Testing, and imposed on her the penalty of reprimand; and the CA Resolution dated August 20, 2004[5] which denied the petitioner's subsequent motion for reconsideration.

(b)

THE ANTECEDENTS On May 24, 2002, the private respondent filed an Affidavit-Complaint charging the petitioner before the Ombudsman of serious misconduct, conduct unbecoming of a public official, abuse of authority, and violations of the Revised Penal Code and of the Graft and Corrupt Practices Act.[6] The private respondent stated in her complaint that she is the President of the Association of Drug Testing Centers (Association) that conducts drug testing and medical examination of applicants for driver's license. In this capacity, she went to the Land Transportation Office (LTO) on May 17, 2002 to meet with representatives from the Department of Transportation and Communication (DOTC) and to file a copy of the Association's request to lift the moratorium imposed by the LTO on the accreditation of drug testing clinics. Before proceeding to the office of the LTO Commissioner for these purposes, she passed by the office of the petitioner to conduct a follow up on the status of her company's application for accreditation. While there, the petitioner -- without provocation or any justifiable reason and in the presence of other LTO employees and visitors -- shouted at her in a very arrogant and insulting manner, hurled invectives upon her person, and prevented her from entering the office of the LTO Commissioner. The petitioner also accused the private respondent of causing intrigues against her at the DOTC. To prove her allegations, the private respondent presented the affidavits of three witnesses.[7] The Ombudsman furnished the petitioner a copy of the Complaint-Affidavit and required her to file her counter-affidavit. In her Counter-Affidavit, the petitioner denied the private respondent's allegations and claimed that she merely told the private respondent to bring her request to the LTO Assistant Secretary who has the authority to act on the matter, not to the DOTC.[8] The petitioner also claimed that the private respondent also asked her to lift the moratorium and pressured her to favorably act on the private respondent's application for accreditation. To prove these claims, petitioner presented the affidavits of her two witnesses.[9] The Ombudsman called for a preliminary conference that the parties attended. The petitioner manifested her intent to submit the case for resolution. The Ombudsman then directed the parties to submit their respective memoranda. Only the petitioner filed a Memorandum where she stressed that the complaint is not properly substantiated for lack of supporting affidavits and other evidence.[10] The Office of the Ombudsman The Ombudsman rendered the November 4, 2002 Decision based on the pleadings and the submitted affidavits. It found the petitioner administratively liable for discourtesy in the course of her official functions and imposed on her the penalty of reprimand. The Ombudsman ruled that the petitioner's verbal assault on the private respondent was sufficiently established by the affidavits of the private respondent's witnesses who had not been shown by evidence to have any motive to falsely testify against petitioner. In contrast, the petitioner's witnesses, as her officemates, were likely to testify in her favor. Given that the incident happened at the LTO and that the petitioner had authority to act on the private respondent's application for accreditation, the

Ruivivar vs. OMB

Ombudsman also found that the petitioner's ascendancy over the private respondent made the petitioner's verbal assault more likely. The Ombudsman concluded that such verbal assault might have been caused by the private respondent's decision to air the LTO moratorium issue (on accreditation for drug testing centers) before the DOTC; this decision also negated the petitioner's defense that the case was filed to exert pressure on her to act favorably on private respondent's application for accreditation. The petitioner filed a Motion for Reconsideration arguing that she was deprived of due process because she was not furnished copies of the affidavits of the private respondent's witnesses.[11] In the same motion, petitioner questioned the Ombudsman's disregard of the evidence she had presented, and disagreed with the Ombudsman's statement that she has ascendancy over the private respondent. The Ombudsman responded to the petitioner's motion for reconsideration by ordering that the petitioner be furnished with copies of the affidavits of the private respondent's witnesses. [12] The Ombudsman's order also contained the "directive to file, within ten (10) days from receipt of this Order, such pleading which she may deem fit under the circumstances." Records show that the petitioner received copies of the private respondent's witnesses' affidavits but she did not choose to controvert these affidavits or to file a supplement to her motion for reconsideration. She simply maintained in her Manifestation that her receipt of the affidavits did not alter the fact the she was deprived of due process nor cure the irregularity in the November 4, 2002 Decision. Under these developments, the Ombudsman ruled that the petitioner was not denied due process. It also maintained the findings and conclusions in its November 4, 2002 Decision, declaring them supported by substantial evidence.[13] The Court of Appeals The petitioner's chosen remedy, in light of the Ombudsman ruling, was to file a petition for certiorari(docketed as CA-GR SP No. 77029) with the CA. In its Decision dated May 26, 2004, the CA dismissed the petition on the ground that the petitioner used the wrong legal remedy and failed to exhaust administrative remedies before the Ombudsman.[14] The CA said: "... as held in Fabian v. Desierto, a party aggrieved by the decision of the Office of the Ombudsman may appeal to this Court by way of a petition for review under Rule 43. As succinctly held by the Supreme Court: `As a consequence of our ratiocination that Section 27 of Republic Act No. 6770 should be struck down as unconstitutional, and in line with regulatory philosophy adopted in appeals from quasi-judicial agencies in the 1997 Revised Rules of Civil Procedure, appeals from decision of the Office of the Ombudsman in administrative disciplinary cases should be taken to the CA under the provisions of Rule 43.' Even assuming, argumentatis, that public respondent committed grave abuse of discretion, such fact is not sufficient to warrant the issuance of the extraordinary writ of certiorari, as was held in Union of Nestle Workers Cagayan de Oro Factory vs. Nestle Philippines, Inc.: `x x x .For certiorari to prosper, it is not enough that the trial court committed grave abuse of discretion amounting to lack or excess of jurisdiction, as alleged by petitioners. The requirement that there is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law must likewise be satisfied. x x x' Petitioner was given the opportunity by public respondent to rebut the affidavits submitted by private respondent, in its Order dated January 17, 2003. Petitioner, therefore, had a speedy and adequate remedy, but she failed to avail thereof for reasons only known to her. xxx Moreover, instead of filing a petition for review under Rule 43, she filed the present petition for certiorari under Rule 65. In view of our above disquisition, We find no further reason to discuss the merits of the case. Petitioner having resorted to the wrong remedy, the dismissal of the present petition is in order.[15] After the CA's negative ruling on the motion for reconsideration, the petitioner filed the present petition for review on certiorari with this Court, raising the following issues: THE ISSUES

I.

WHETHER OR NOT A PETITION FOR CERTIORARI UNDER RULE 65 IS THE PROPER AND ONLY AVAILABLE REMEDY WHEN THE PENALTY IMPOSED IN AN ADMINISTRATIVE COMPLAINT WITH THE OFFICE OF THE OMBUDSMAN IS CONSIDERED FINAL AND UNAPPEALABLE.

Ruivivar vs. OMB

II. WHETHER OR NOT PETITIONER WAS DENIED OF (sic) THE CONSTITUTIONAL GUARANTEE TO DUE PROCESS WHEN SHE WAS DEPRIVED OF HER RIGHT TO CONFRONT THE EVIDENCE SUBMITTED AGAINST HER BEFORE THE DECISION OF THE OFFICE OF THE OMBUDSMAN WAS RENDERED.

On the first issue, the petitioner argued that the ruling in Fabian v. Desierto[16] can only be applied when the decision of the Ombudsman is appealable. The ruling in Fabian is not applicable to the Ombudsman rulings under the express provisions of Section 27 of Republic Act (R.A.) No. 6770[17]and Section 7, Rule III of Administrative Order (A.O.) No. 7[18] since the penalty of reprimand imposed is final and unappealable. The appropriate remedy, under the circumstances, is not the appellate remedy provided by Rule 43 of the Rules of Court but a petition for certiorari under Rule 65 of these Rules. On the second issue, the petitioner maintained that she was denied due process because no competent evidence was presented to prove the charge against her. While she was belatedly furnished copies of the affidavits of the private respondent's witnesses, this was done after the Ombudsman had rendered a decision. She posited that her belated receipt of the affidavits and the subsequent proceedings before the Ombudsman did not cure the irregularity of the November 4, 2002 Decision as she was not given the opportunity to refute the private respondent's evidencebefore the Ombudsman's decision was rendered. The petitioner advanced the view that on this ground alone, she should be allowed to question the arbitrary exercise of the Ombudsman's discretion. The Ombudsman's Comment,[19] filed through the Office of the Solicitor General, maintained that the proper remedy to assail the November 4, 2002 Decision and February 12, 2003 Order was to file a petition for review under Rule 43 as laid down in Fabian,[20] and not the petition for certiorari that the petitioner filed. The Ombudsman argues further that since no petition for review was filed within the prescribed period (as provided under Section 4, Rule 43),[21] the November 4, 2002 Decision and February 12, 2003 Order had become final and executory. The Ombudsman maintained, too, that its decision holding the petitioner administratively liable is supported by substantial evidence; the petitioner's denial of the verbal assault cannot prevail over the submitted positive testimony. The Ombudsman also asserted that the petitioner was not denied due process as she was given the opportunity to be heard on the affidavits that were belatedly furnished her when she was directed to"file any pleading as she may consider fit." The private respondent shared the positions of the Ombudsman in her Comment.[22] Both the Office of the Solicitor General and the private respondent also asserted the doctrine that factual findings of administrative agencies should be given great respect when supported by substantial evidence. We initially denied the petition in our Resolution dated December 12, 2005 for the petitioner's failure to comply with our Resolutions dated March 30, 2005 and April 25, 2005. However, we reconsidered the denial in a subsequent Resolution (dated February 27, 2006)[23] and reinstated the petition on the petitioner's motion for reconsideration after she complied with our directives. We required the parties to submit their respective memoranda where they reiterated the positions presented in their previous submissions. THE COURT'S RULING We deny the Petition. While we find that the Court of Appeals erred in its ruling on the appropriate mode of review the petitioner should take, we also find that the appellate court effectively ruled on the due process issue raised - the failure to provide the petitioner the affidavits of witnesses - although its ruling was not directly expressed in due process terms. The CA's finding that the petitioner failed to exhaust administrative remedies (when she failed to act on the affidavits that were belatedly furnished her) effectively embodied a ruling on the due process issue at the same time that it determined the propriety of the petition for certiorari that the CA assumed arguendo to be the correct remedy. Under this situation, the error in the appellate court's ruling relates to a technical matter - the mode of review that the petitioner correctly took but which the CA thought was erroneous. Despite this erroneous conclusion, the CA nevertheless fully reviewed the petition and, assuming it arguendo to be the correct mode of review, also ruled on its merits. Thus, while it erred on the mode of review aspect, it correctly ruled on the exhaustion of administrative remedy issue and on the due process issue that the exhaustion issue implicitly carried. In these lights, the present petition essentially has no merit so that its denial is in order. The Mode of Review Issue

Ruivivar vs. OMB

The case of Fabian v. Desierto[24] arose from the doubt created in the application of Section 27 of R.A. No. 6770 (The Ombudsman's Act) and Section 7, Rule III of A.O. No. 7 (Rules of Procedure of the Office of the Ombudsman) on the availability of appeal before the Supreme Court to assail a decision or order of the Ombudsman in administrative cases. In Fabian, we invalidated Section 27 of R.A. No. 6770 (and Section 7, Rule III of A.O. No. 7 and the other rules implementing the Act) insofar as it provided for appeal by certiorari under Rule 45 from the decisions or orders of the Ombudsman in administrative cases. We held that Section 27 of R.A. No. 6770 had the effect, not only of increasing the appellate jurisdiction of this Court without its advice and concurrence in violation of Section 30, Article VI of the Constitution; it was also inconsistent with Section 1, Rule 45 of the Rules of Court which provides that a petition for review on certiorari shall apply only to a review of "judgments or final orders of the Court of Appeals, the Sandiganbayan, the Court of Tax Appeals, the Regional Trial Court, or other courts authorized by law."[25] We pointedly said: As a consequence of our ratiocination that Section 27 of Republic Act No. 6770 should be struck down as unconstitutional, and in line with the regulatory philosophy adopted in appeals from quasi-judicial agencies in the 1997 Revised Rules of Civil Procedure, appeals from decisions of the Office of the Ombudsman in administrative disciplinary cases should be taken to the CA under the provisions of Rule 43.[26] We restated this doctrine in several cases[27] and further elaborated on the recourses from Ombudsman actions in other cases we have decided since then. In Lapid v. CA, we explained that an appeal under Rule 43 to the CA only applies to administrative cases where the right to appeal is granted under Section 27 of R.A. No. 6770.[28] In Lopez v. CA[29] and Herrera v. Bohol,[30] we recognized that no appeal is allowed in administrative cases where the penalty of public censure, reprimand, suspension of not more than one month, or a fine equivalent to one month salary, is imposed. We pointed out that decisions of administrative agencies that are declared by law to be final and unappealable are still subject to judicial review if they fail the test of arbitrariness or upon proof of gross abuse of discretion;[31] the complainant's legal recourse is to file a petition forcertiorari under Rule 65 of the Rules of Court, applied as rules suppletory to the Rules of Procedure of the Office of the Ombudsman.[32] The use of this recourse should take into account the last paragraph of Section 4, Rule 65 of the Rules of Court - i.e., the petition shall be filed in and be cognizable only by the CA if it involves the acts or omissions of a quasi-judicial agency, unless otherwise provided by law or by the Rules.[33] In the present case, the Ombudsman's decision and order imposing the penalty of reprimand on the petitioner are final and unappealable. Thus, the petitioner availed of the correct remedy when she filed a petition for certiorari before the CA to question the Ombudsman's decision to reprimand her. The Due Process Issue The CA Decision dismissed the petition for certiorari on the ground that the petitioner failed to exhaust all the administrative remedies available to her before the Ombudsman. This ruling is legally correct as exhaustion of administrative remedies is a requisite for the filing of a petition forcertiorari.[34] Other than this legal significance, however, the ruling necessarily carries the direct and immediate implication that the petitioner has been granted the opportunity to be heard and has refused to avail of this opportunity; hence, she cannot claim denial of due process. In the words of the CA ruling itself: "Petitioner was given the opportunity by public respondent to rebut the affidavits submitted by private respondent. . . and had a speedy and adequate administrative remedy but she failed to avail thereof for reasons only known to her." For a fuller appreciation of our above conclusion, we clarify that although they are separate and distinct concepts, exhaustion of administrative remedies and due process embody linked and related principles. The "exhaustion" principle applies when the ruling court or tribunal is not given the opportunity to re-examine its findings and conclusions because of an available opportunity that a party seeking recourse against the court or the tribunal's ruling omitted to take.[35] Under the concept of "due process," on the other hand, a violation occurs when a court or tribunal rules againsta party without giving him or her the opportunity to be heard.[36] Thus, the exhaustion principle is based on the perspective of the ruling court or tribunal, while due process is considered from the point of view of the litigating party against whom a ruling was made. The commonality they share is in the same "opportunity" that underlies both. In the context of the present case, the available opportunity to consider and appreciate the petitioner's counter-statement of facts was denied the Ombudsman; hence, the petitioner is barred from seeking recourse at the CA because the ground she would invoke was not considered at all at the Ombudsman level. At the same time, the petitioner - who had the same opportunity to rebut the belatedly-furnished affidavits of the private respondent's witnesses was not denied and cannot now claim denial of due process because she did not take advantage of the opportunity opened to her at the Ombudsman level. The records show that the petitioner duly filed a motion for reconsideration on due process grounds (i.e., for the private respondent's failure to furnish her copies of the affidavits of witnesses) and on questions relating to the appreciation of the evidence on record.[37] The Ombudsman acted on this motion by issuing its Order of January 17, 2003 belatedly furnishing her with copies of the private respondent's witnesses, together with the "directive to file, within ten (10) days from receipt of this

Ruivivar vs. OMB

Order, such pleading which she may deem fit under the circumstances."[38] Given this opportunity to act on the belatedly-furnished affidavits, the petitioner simply chose to file a "Manifestation" where she took the position that "The order of the Ombudsman dated 17 January 2003 supplying her with the affidavits of the complainant does not cure the 04 November 2002 order," and on this basis prayed that the Ombudsman's decision "be reconsidered and the complaint dismissed for lack of merit."[39] For her part, the private respondent filed a Comment/Opposition to Motion for Reconsideration dated 27 January 2003 and prayed for the denial of the petitioner's motion. In the February 12, 2003 Order, the Ombudsman denied the petitioner's motion for reconsideration after finding no basis to alter or modify its ruling.[40] Significantly, the Ombudsman fully discussed in this Order the due process significance of the petitioner's failure to adequately respond to the belatedly-furnished affidavits. The Ombudsman said: "Undoubtedly, the respondent herein has been furnished by this Office with copies of the affidavits, which she claims she has not received. Furthermore, the respondent has been given the opportunity to present her side relative thereto, however, she chose not to submit countervailing evidence or argument. The respondent, therefore (sic), cannot claim denial of due process for purposes of assailing the Decision issued in the present case. On this score, the Supreme Court held in the case of People v. Acot, 232 SCRA 406, that "a party cannot feign denial of due process where he had the opportunity to present his side". This becomes all the more important since, as correctly pointed out by the complainant, the decision issued in the present case is deemed final and unappealable pursuant to Section 27 of Republic Act 6770, and Section 7, Rule III of Administrative Order No. 07. Despite the clear provisions of the law and the rules, the respondent herein was given the opportunity not normally accorded, to present her side, but she opted not to do so which is evidently fatal to her cause." [emphasis supplied]. Under these circumstances, we cannot help but recognize that the petitioner's cause is a lost one, not only for her failure to exhaust her available administrative remedy, but also on due process grounds.The law can no longer help one who had been given ample opportunity to be heard but who did not take full advantage of the proffered chance. WHEREFORE, premises considered, we hereby DENY the petition. This denial has the effect of confirming the finality of the Decision of the Ombudsman dated November 4, 2002 and of its Order dated February 12, 2003. SO ORDERED.

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[A.M. No. 05-12-757-RTC. March 7, 2006] RE: SEXUAL HARASSMENT COMMITED PACURIBOT, RTC, BR. 27, GINGOOG CITY En Banc Sirs/Mesdames: Quoted hereunder, for your information, is a resolution of the Court dated MAR. 7, 2006 A.M. No. 05-12-757-RTC (Re: Sexual Harassment Committed by Judge Rexel M. Pacuribot, Regional Trial Court, Branch 27, Gingoog City) This refers to the Memorandum of the Office of the Court Administrator (OCA) dated 14 December 2005, to wit: BY JUDGE REXEL M.

Two (2) women filed separate complaints for sexual harassment against Judge Rexel M. Pacuribot. The first is Sherlita O. Tan, Court Stenographer III, Regional Trial Court, Branch 27, GingoogCity and the other is Johanna M. Villafranca, Clerk II, Gingoog City Parole and Probation Office. Both are married. Ms. Tan's ordeal started in August 2004 when she refused an invitation from Judge Pacuribot to have dinner. On October 4, 2004, Judge Pacuribot sent her a text message saying that his blood pressure went up because she refused to go out with him. On October 20, 2004, Ms. Tan was attending a wedding at Pryce Plaza Hotel in Cagayan de Oro when Judge Pacuribot called her on the mobile phone asking when she will be back in GingoogCity. She said that she will leave immediately after the wedding and she will just take a taxicab to the Agora Terminal. Judge Pacuribot said that she would fetch Ms. Tan from the hotel. Ms. Tan declined the offer but Judge Pacuribot angrily insisted on the ground that he was already waiting outside the hotel. Ms. Tan, who was now scared, went out and got in the car. However, instead of bringing Ms. Tan to the terminal, Judge Pacuribot brought her to a motel. When she protested (sic) Judge Pacuribot harshly told her to -"Shut up! As if you are a virgin!" x x x. Judge Pacuribot and Ms. Tan left the motel but instead of going to the terminal, he brought her to the Discovery Hotel saying that it would be better for Ms. Tan to sleep there instead of traveling alone. Judge Pacuribot left Ms. Tan alone in the room because he had to attend a Masonic Conference. She however could not leave because she did not have enough money to pay the balance of the hotel bill. At around 7 a.m. of the following morning, Judge Pacuribot arrived. Ms. Tan's ordeal started all over again. xxxx Back in the office, the harassment continued. Whenever Ms. Tan would go inside Judge Pacuribot's chamber, the latter would grab her blouse, mash her breast, kiss her, touch the crutch (sic) of her pants, pull the string of her panty and kiss her neck while saying that she smelt so sweet. Judge Pacuribot got angry when Ms. Tan refused to answer his text messages and insinuated that this will have an adverse effect on her performance rating.

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Ms. Johanna M. Villafranca, on the other hand, was initially the recipient of amorous text messages from Judge Pacuribot with invitations for dinner. Ms. Villafranca was wary of these invitations because both of them are married. She refused all of these invitations but Judge Pacuribot was persistent forcing her to request for a transfer, which was however denied. In the last week of February 2005, she got a call from Judge Pacuribot who was furious. According to him, he was an honorable person and yet Ms. Villafranca refused his invitations. Consumed by fear, she finally relented and accepted a dinner invitation on February 22, 2005. While inside his car, Judge Pacuribot displayed his firearm, which was allegedly for security purposes. It nevertheless intensified Ms. Villafranca's fear. Instead of going to a restaurant, JudgePacuribot drove to a drive-in motel x x x. xxxx From that day, Judge Pacuribot constantly demanded that Ms. Villafranca send him text messages and letters expressing sweet nonsense to feed his ego and any failure or refusal would be met by a threat to divulge the incident in the motel. xxxx Then Judge Pacuribot started demanding food from Ms. Villafranca, which the latter was supposed to bring to his boarding house. If she refused, Judge Pacuribot would threaten to tell damaging stories to her mother-in-law with whom she had a strained relation and to show the picture he took on the cell phone. Because of these threats, Ms. Villafranca was forced to bring some food to Judge Pacuribot. x x x. When Judge Pacuribot sensed that she was not going to file an annulment case, he drafted a document wherein it was stated that Ms. Villafranca and her husband supposedly agreed that they may freely cohabit with a third person. Judge Pacuribot, using threats of physical and social harm, forced Ms. Villafranca and her husband to sign the document. When Ms. Villafranca still did not file the annulment case, Judge Pacuribot slapped her and hit her head with a clenched fist. Again he placed a kiss mark on her neck and when her husband saw it, he beat her up. When Judge Pacuribot knew of the beating, he forced Ms. Villafranca to file a rape case but she refused. xxxx The complainants filed their complaints personally before the Office of Deputy Court Administrator Christopher O. Lock. Although Ms. Tan and Ms. Villafranca knew each other professionally, their meeting at the said office was purely coincidental and they had no idea that the other was likewise the victim of Judge Pacuribot. Ms. Tan and Ms. Villafranca tearfully related to Deputy Court Administrator Christopher Lock their harrowing experience at the hands of Judge Pacuribot. The investigation of Ms. Tan's complaint falls within the jurisdiction of the Committee on Decorum and Investigation of the Regional Trial Court of Gingoog City while that of Ms. Villafranca falls

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within the jurisdiction of this Office since she is not an employee of the judiciary. In either case, the seriousness of the offense calls for a full blown investigation and for this purpose it is necessary to suspend Judge Pacuribot. His suspension from office will serve not only to protect the principal witnesses against harassment but will also prevent him from committing further acts of sexual harassment. The fact that two (2) women filed these complaints independent of each other and that the allegations therein show a consistent pattern of sexual deviancy, present a prima facie case against Judge Pacuribot whose immediate suspension is demanded by the circumstances.
In the same Memorandum, the OCA recommended that:
1. The complaint of Ms. Sherlita Tan be referred to the Committee on Decorum and Investigation of the regional Trial court (sic) of Gingoog City for investigation; 2. The complaint of Ms. Johanna M. Villafranca be docketed as a regular administrative matter; 3. Judge Pacuribot be required to comment on the complaint of Ms. Villafranca; and 4. Judge Pacuribot be suspended immediately until further orders from this Court.

After painstaking consideration of the facts and existing laws, this Court finds the foregoing recommendations not to be wholly in consonance with, as in fact it contravenes, Section 3 of Rule 140 of the Rules of Court, as amended by A.M. No. 01-8-10-SC,[1] providing for the manner by which complaints against Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals[2] are investigated, in relation to the Supreme Court's constitutionally guaranteed power of administrative supervision [3]over all courts and the personnel thereof. Section 3 of Rule 140 of the Rules of Court, as amended, categorically provides that:

Sec. 3. By whom complaint investigated. - Upon the filing of the respondent's comment, or upon the expiration of the time for filing the same and unless other pleadings or documents are required, the Court shall refer the matter to the Office of the Court Administrator for evaluation, report, and recommendation or assign the case for investigation, report, and recommendation to a retired member of the Supreme Court, if the respondent is a Justice of the Court of Appeals and the Sandiganbayan, or to a Justice of the Court of Appeals, if the respondent is a Judge of a Regional Trial Court or of a special court of equivalent rank, or to a Judge of the Regional Trial Court if the respondent is a Judge of an inferior court.
By virtue of the aforequoted provision, Section 8 of Administrative Circular No. 03-03-1 3-SC[4], the Rule on Administrative Procedure in Sexual Harassment Cases and Guidelines on Proper Work Decorum in the Judiciary, which provides for the referral of work related sexual harassment complaints committed by officials and employees of the Judiciary, necessarily including Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals, but excluding the members of this Court and the Judicial and Bar Council, to committees on decorum and investigation[5] (CODIs), appears to furtively dilute the exclusivity of this Court's constitutionally guaranteed power of administrative supervision which necessarily includes the authority to discipline Judges and Justices. Section 8 of the Rule on Administrative Procedure in Sexual Harassment Cases and Guidelines on Proper Work Decorum in the Judiciary states that:

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Sec, 8. Jurisdiction, powers and responsibilities of the CODIs. - The CODIs shall have jurisdiction over all complaints for sexual harassment committed by officials and employees of the Judiciary. They shall:
(a) Receive the complaint, investigate its allegations, and submit a report and recommendation to the proper court or authority, as provided for in Section 18 of this Rule; x x x x. [Emphasis supplied.]

The composition[6] of a particular CODI, to all intents and purposes, partly grants rank and file employees of courts the competence to recommend administrative sanctions over Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals thereby potentially diminishing the authority of this Court over the position, the person and the courts over which they preside. Appropriately, this Court deems it prudent to exclude said Judges and Justices from the ambit of the jurisdiction of CODIs as provided under Section 8 of A.M. No. 03-03-13-SC. Moreover, upon their assumption to office, Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals cease to be ordinary citizens. They become the visible representation of the law, and more importantly, of justice. The public look up to them as the epitome of integrity and justice. For this reason, as this Court has stated in the case of Aquino v. Acosta[7], "[a]dministrative complaints against members of the judiciary are viewed by this Court with utmost care, for proceedings of this nature affect not only the reputation of the respondents concerned, but the integrity of the entire judiciary as well." Thus, ever mindful of such propensity, investigations of sexual harassment complaints involving Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayanand the Court of Tax Appeals must be kept in strictest confidentiality - quite relatively unrealistic in proceedings vis-a-vis referral of a sexual harassment complaint to a group or panel as laid down by the subject rule. In fine, the referral of Ms. Sherlita Tan's sexual harassment complaint against Judge Rexel Pacuribot to the CODI of the RTC of Gingoog City for investigation, reportand recommendation, contravenes Section 3 of Rule 140 of the Rules of Court and limits, nay, weakens this Court's constitutionally mandated disciplining authority over Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals, besides exposing the courts to ridicule and derision. NOW, THEREFORE, BE IT RESOLVED, as it is hereby Resolved, that in accordance with Section 6, Article VIII of the Constitution vesting this Court with the power of administrative supervision over all courts and personnel thereof, inclusive of which is the authority to discipline Judges and Justices, complaints of sexual harassment against Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals should be excluded from the jurisdiction of the CODIs. Accordingly, Section 8 of A.M. No. 03-03-13-SC, the Rule on Administrative Procedure in Sexual Harassment Cases and Guidelines on Proper Work Decorum in the Judiciary is hereby amended to read as follows:

Sec. 8. Jurisdiction, powers and responsibilities of the CODIs. - The CODIs shall have jurisdiction over all complaints for sexual harassment committed by officials and employees of the Judiciary, except those against Judges of regular and special courts and Justices of the Court of Appeals, the Sandiganbayan and the Court of Tax Appeals, which shall fundamentally adhere to the proceeding laid down in Section 3 of Rule 140 of the Rules of Court, as amended .
CODIs shall:

AM 05-12-757-RTC (a) Receive the complaint, investigate its allegations, and submit a report and recommendation to the proper court or authority, as provided for in Section 18 of this Rule; x x x x. [Emphasis supplied.]

With respect to all the other recommendations of the OCA, finding them to be in accord with existing laws, the same are hereby APPROVED. In particular, Judge RexelPacuribot is immediately SUSPENDED until further notice from this Court. He is likewise DIRECTED to comment on the complaints of Mesdames Tan and Villafrancawithin ten days. The complaint, however, of Ms. Sherlita Tan should be docketed as a regular administrative matter to be consolidated with that of Ms. Johanna M.Villafranca's for proper disposition in line with the foregoing discussion. Very truly yours, (Sgd.) MA. LUISA D. VILLARAMA Clerk of Court