GREATER

METROPOLITAN
MANILA
SOLID
WASTE
MANAGEMENT COMMITTEE and the METROPOLITAN
MANILA
DEVELOPMENT
AUTHORITY,
petitioners,vs. JANCOM ENVIRONMENTAL CORPORATION
and JANCOM INTERNATIONAL DEVELOPMENT PROJECTS
PTY. LIMITED OF AUSTRALIA, respondents.
Remedial Law; Writs of Execution; Once a judgment becomes
final, it is basic that the prevailing party is entitled as matter of
right to a writ of execution the issuance of which is the trial
courts ministerial duty.Once a judgment becomes final, it is
basic that the prevailing party is entitled as a matter of right to
a writ of execution the issuance of which is the trial courts
ministerial duty, compellable by mandamus.
Writs of Execution; That a writ of execution must conform to
the judgment which is to be executed, substantially to every
essential particular thereof, it is settled.That a writ of
execution must conform to the judgment which is to be
executed, substantially to every essential particular thereof, it
is settled. It may not thus vary the terms of the judgment it
seeks to enforce, nor go beyond its terms. Where the
execution is not in harmony with the judgment which gives it
life and exceeds it, it has no validity.
Civil Law; Contracts; A contract, being consensual is perfected
by mere consent.It is elementary that, being consensual, a
contract is perfected by mere consent. The essence of consent
is the conformity of the parties to the terms of the contract,
the acceptance by one of the offer made by the other; it is the
concurrence of the minds of the parties on the object and the
cause which shall constitute the contract. Where there is
merely an offer by one party without acceptance by the other,
there is no consent and the contract does not come into
existence.

Contracts; No meeting of the mind was established when there

was no acceptance in the initial offer made.As distinguished
from the original contract in which this Court held in G.R. No.
147465: x x x the signing and execution of the contract by the
parties clearly show that, as between the parties, there was
concurrence of offer and acceptance with respect to the
material details of the contract, thereby giving rise to the
perfection of the contract. The execution and signing of the
contract is not disputed by the parties x x x, the parties did
not, with respect to the Amended Agreement, get past the
negotiation stage. No meeting of minds was established. While
there was an initial offer made, there was no acceptance.
Same; An absolute or unqualified acceptance of a definite offer
manifests the consent necessary to perfect a contract.Only
an absolute or unqualified acceptance of a definite offer
manifests the consent necessary to perfect a contract. If at all,
the MMDA letter only shows that the parties had not gone
beyond the preparation stage, which is the period from the
start of the negotiations until the moment just before the
agreement of the parties. Obviously, other material
considerations still remained before the Amended Agreement
could be perfected. At any time prior to the perfection of a
contract, unaccepted offers and proposals remain as such and
cannot be considered as binding commitments.
Legal
Ethics; Attorney-Client-Relationship;Representation
continues until the court dispenses with the services of
counsel.Representation continues until the court dispenses
with the services of counsel in accordance with Section 26,
Rule 138 of the Rules of Court. No substitution of counsel of
record is allowed unless the following essential requisites
concur: (1) there must be a written request for substitution; (2)
it must be filed with the written consent of the client; (3) it
must be with the written consent of the attorney to be
substituted; and (4) in case the consent of the attorney to be

substituted cannot be obtained, there must be at least a proof

of notice that the motion for substitution was served on him in
the manner prescribed by the Rules of Court.
Attorney-Client-Relationship;The exercise of client of its right
to substitute his counsel at any stage of the proceedings is
subject to compliance with the prescribed requirements.
While clients undoubtedly have the right to terminate their
relations with their counsel and effect a substitution or change
at any stage of the proceedings, the exercise of such right is
subject to compliance with the prescribed requirements.
Otherwise, no substitution can be effective and the counsel
who last appeared in the case before the substitution became
effective shall still be responsible for the conduct of the case.
The rule is intended to ensure the orderly disposition of cases.
PETITION for review on certiorari of the decision and resolution
of the Court of Appeals.
The facts are stated in the opinion of the Court.
The Solicitor General for petitioners.
Manuel
T.
respondents.

Molina andSimeon

Madrid

Magdamitfor

CARPIO-MORALES, J.:
The present petition for review on certiorari challenges the
Decision1dated December 19, 2003 and Resolution2 dated May
11, 2004 of the Court of Appeals (CA)3 in CA-G.R. SP No.
78752 which denied the petition for certiorari filed by herein
petitioners
Greater
Metropolitan
Manila
Solid
Waste
Management Committee (GMMSWMC) and the Metropolitan
Manila Development Authority (MMDA) and their Motion for
Reconsideration, respectively.

In 1994, Presidential Memorandum Order No. 202 was issued

by then President Fidel V. Ramos creating an Executive
Committee to oversee and develop waste-to-energy projects
for the waste disposal sites in San Mateo, Rizal and Carmona,
Cavite under the Build-Operate-Transfer (BOT) scheme.
Respondent Jancom International Development Projects Pty.
Limited of Australia (Jancom International) was one of the
bidders for the San Mateo Waste Disposal Site. It subsequently
entered into a partnership with Asea Brown Boveri under the
firm name JANCOM Environmental Corporation (JANCOM), its
co-respondent.
On February 12, 1997, the above-said Executive Committee
approved the recommendation of the Pre-qualification, Bids
and Awards Committee to declare JANCOM as the sole
complying bidder for the San Mateo Waste Disposal Site.
On December 19, 1997, a Contract for the BOT Implementation
of the Solid Waste Management Project for the San Mateo,
Rizal Waste Disposal Site4 (the contract) was entered into by
the Republic of the Philippines, represented by the Presidential
Task Force on Solid Waste Management through then
Department of Environment and Natural Resources Secretary
Victor Ramos, then Cabinet Office for Regional DevelopmentNational Capital Region Chairman Dionisio dela Serna, and
then MMDA Chairman Prospero Oreta on one hand, and
JANCOM represented by its Chief Executive Officer Jorge Mora
Aisa and its Chairman Jay Alparslan, on the other.
On March 5, 1998, the contract was submitted for approval to
President Ramos who subsequently endorsed it to then
incoming President Joseph E. Estrada.
Owing to the clamor of the residents of Rizal, the Estrada
administration ordered the closure of the San Mateo landfill.

Petitioner GMMSWMC thereupon adopted a Resolution not to

pursue the contract with JANCOM, citing as reasons therefor
the passage of Republic Act 8749, otherwise known as the
Clean Air Act of 1999, the non-availability of the San Mateo
site, and costly tipping fees.5

By Decision12 of November 13, 2000, the CA denied the

petition for lack of merit and affirmed in toto the May 29, 2000
RTC Decision. Petitioners Motion for Reconsideration was
denied, prompting them to file a petition for review before this
Court, docketed as G.R. No. 147465.

The Board of Directors of Jancom International thereafter

adopted on January 4, 2000 a Resolution 6 authorizing Atty.
Manuel Molina to act as legal counsel for respondents and
determine and file such legal action as deemed necessary
before the Philippine courts in any manner he may deem
appropriate against petitioners.

By Decision13 of January 30, 2002 and Resolution 14 of April 10,

2002, this Court affirmed the November 13, 2001 CA Decision
and declared the contract valid and perfected, albeitineffective
and unimplementable pending approval by the President.

The Board of Directors of JANCOM also adopted a

Resolution7 on February 7, 2000 granting Atty. Molina similar
authorization to file legal action as may be necessary to
protect its interest with respect to the contract.
On March 14, 2000, respondents filed a petition for
certiorari8 with the Regional Trial Court (RTC) of Pasig City
where it was docketed as Special Civil Action No. 1955, to
declare
the GMMSWMC Resolution and the acts of the MMDA calling for
bids for and authorizing the forging ofanew contract for the
Metro Manila waste management as illegal, unconstitutional
and void and to enjoin petitioners from implementing the
Resolution and making another award in lieu thereof.
By Decision9 of May 29, 2000, Branch 68 of the Pasig City RTC
found in favor of respondents.10
Petitioners thereupon assailed the RTC Decisionvia petition for
certiorari11with prayer for a temporary restraining order with
the CA, docketed as CA-G.R. SP No. 59021.

JANCOM and the MMDA later purportedly entered into

negotiations to modify certain provisions of the contract which
were embodied in a draftAmended Agreement15 dated June
2002. The draft Amended Agreement bore no signature of the
parties.
Respondents, through Atty. Molina, subsequently filed before
Branch 68 of the Pasig City RTC an Omnibus Motion 16 dated July
29, 2002 praying that: (1) an alias writ of execution be issued
prohibiting and enjoining petitioners and their representatives
from calling for, accepting, evaluating, approving, awarding,
negotiating or implementing all bids, awards and contracts
involving other Metro Manila waste management projects
intended to be pursued or which are already being pursued; (2)
the MMDA, through its Chairman Bayani F. Fernando, be
directed to immediately forward and recommend the approval
of the Amended Agreement to President Gloria Macapagal
Arroyo; (3) Chairman Fernando be ordered to personally
appear before the court and explain his acts and public
pronouncements which are in direct violation and gross
defiance of the final and executory May 29, 2000 RTC Decision;
(4) the Executive Secretary and the Cabinet Secretaries of the
departments-members
of
the
National
Solid
Waste
Management Commission be directed to submit the contract
within 30 days from notice to the President for signature and

approval and if the latter chooses not to sign or approve the

contract, the Executive Secretary be made to show cause
therefor; and (5) petitioners be directed to comply with and
submit their written compliance with their obligations
specifically directed under the provisions of Article 18,
paragraphs 18.1, 18.1.1 (a), (b), (c) and (d) of the contract
within 30 days from notice.17
To
the
Omnibus
Motion
petitioners
filed
their
18
19
Opposition which merited JANCOMs Reply filed on August
19, 2002.
On August 21, 2002, Atty. Simeon M. Magdamit, on behalf of
Jancom International, filed before the RTC an Entry of Special
Appearance and Manifestation with Motion to Reject the
Pending Omnibus Motion20 alleging that: (1) the Omnibus
Motion was never approved by Jancom International; (2) the
Omnibus Motion was initiated by lawyers whose services had
already been terminated, hence, were unauthorized to
represent it; and (3) the agreed judicial venue for dispute
resolution relative to the implementation of the contract is the
International Court of Arbitration in the United Kingdom
pursuant to Article 16.121 of said contract.
In the meantime, on November 3, 2002, the MMDA forwarded
the contract to the Office of the President for appropriate
action,22 together with MMDA Resolution No. 02-18 23 dated June
26, 2002, Recommending to her Excellency the President of
the Republic of the Philippines to Disapprove the Contract
Entered Into by the Executive Committee of the Presidential
Task Force on Waste Management with Jancom Environmental
Corporation and for Other Purposes.
By Order24 of November 18, 2002, the RTC noted the
abovestated Entry of Special Appearance of Atty. Magdamit for
Jancom International and denied the Motion to Reject Pending

Omnibus Motion for lack of merit. Jancom International filed on

December 9, 2002 a Motion for Reconsideration 25which was
denied for lack of merit by Order26 of January 8, 2003.
Petitioners and respondents then filed their Memoranda 27 on
May 23, 2003 and May 26, 2003, respectively.
By Order28 of June 11, 2003, the RTC granted respondents
Omnibus Motion in part. The dispositive portion of the Order
reads, quotedverbatim:
WHEREFORE, in view of the foregoing, let an Alias Writ of
Execution immediately issue and the Clerk of Court and ExOficio Sheriff or any o[f] her Deputies is directed to implement
the same within sixty (60) days from receipt thereof.
Thus, any and all such bids or contracts entered into by
respondent MMDA with third parties covering the waste
disposal and management within the Metro Manila after
August 14, 2000 are hereby declared NULL and VOID.
Respondents are henceforth enjoined and prohibited, with a
stern warning, from entering into any such contract with any
third party whether directly or indirectly, in violation of the
contractual rights of petitioner JANCOM under the BOT
Contract Award, consistent with the Supreme Courts Decision
of January 30, 2002.
Respondent MMDA is hereby directed to SUBMIT the Amended
Agreement concluded by petitioners with the previous MMDA
officials, or in its discretion if it finds [it] more advantageous to
the government, to require petitioners to make adjustments in
the Contract in accordance with existing environmental laws
and other relevant concerns, and thereafter forward the
Amended Agreement for signature and approval by the
President of the Philippines. The concerned respondents are
hereby further directed to comply fully and in good faith with

its institutional obligations or undertakings as provided in

Article 18 of the BOT Contract.
Let a copy of this Order be furnished the Office of the Clerk of
Court and the Commission on Audit for its information and
guidance.

Let it be emphasized that this Court is not preventing or

stopping the government from implementing infrastructure
projects as it is aware of the proscription under PD 1818. On
the contrary, the Court is paving the way for the necessary and
modern solution to the perennial garbage problem that has
been the major headache of the government and in the
process would serve to attract more investors in the country.

SO ORDERED.29 (Emphasis in the original)

SO ORDERED.
On June 23, 2003
Execution30 reading:

the

RTC

issued

an

Alias

Writ

of

WHEREAS, on May 29, 2000, a Decision was rendered by this

Court in the above-entitled case, the pertinent portions of
which is [sic] hereunder quoted as follows:
WHEREFORE, in view of the foregoing, the Court hereby
renders
judgment
in
favor
of
petitioners
JANCOM
ENVIRONMENTAL
CORP
and
JANCOM
INTERNATIONAL
DEVELOPMENT PROJECTS PTY., LIMITED OF AUSTRALIAS [sic],
and against respondents GREATER METROPOLITAN MANILA
SOLID WASTE MANAGEMENT COMM., and HON. ROBERTO N.
AVENTAJADO, in his capacity as Chairman of the said
Committee, METRO MANILA DEVELOPMENT AUTHORITY and
HON. JEJOMAR C. BINAY, in his capacity as Chairman of said
Authority, declaring the Resolution of respondent Greater
Metropolitan Manila Solid Waste Management Committee
disregarding petitioners BOT Award Contract and calling for
bids for and authorizing a new contract for the Metro Manila
waste management ILLEGAL an[d] VOID.
Moreover, respondents and their agents are hereby
PROHIBITED and ENJOINED from implementing the aforesaid
Resolution and disregarding petitioners BOT Award Contract
and from making another award in its place.

WHEREAS, on August 7, 2000, petitioners through counsel filed

a Motion for Execution which the Court GRANTED in its Order
dated August 14, 2000; as a consequence thereof, a Writ of
Execution was issued on August 14, 2000 and was duly served
upon respondents as per Sheriffs Return dated August 27,
2000;
WHEREAS, ON July 29, 2002, petitioners through counsel filed
an Omnibus Motion, praying, among others, for the issuance
of an Alias Writ of Execution which the Court GRANTED in its
Order dated June 11, 2003, the dispositive portion of which
reads as follows:
WHEREFORE, in view of the foregoing, let an Alias Writ of
Execution immediately issue and the Clerk of Court and ExOficio Sheriff or any of her Deputies is directed to implement
the same within sixty (60) days from receipt thereof.
Thus, any and all such bids or contracts entered into by
respondent MMDA [with] third parties covering the waste
disposal and management within the Metro Manila after
August 14, 2000 are hereby declared NULL and VOID.
Respondents are henceforth enjoined and prohibited, with a
stern warning, from entering into any such contract with any
third party whether directly or indirectly, in violation of the
contractual rights of petitioner Jancom under the BOT Contract

Award, consistent with the Supreme Courts Decision of

January 30, 2002.
Respondent MMDA is hereby directed to SUBMIT the Amended
Agreement concluded by petitioners with the previous MMDA
officials, or in its discretion if it finds [it] more advantageous to
the government, to require petitioners to make adjustments in
the Contract in accordance with existing environmental laws
and other relevant concerns, and thereafter forward the
Amended Agreement for signature and approval by the
President of the Philippines. The concerned respondents are
hereby further directed to comply fully and in good faith with
its institutional obligations or undertakings as provided in
Article 18 of the BOT Contract.
Let a copy of this Order be furnished the Office of the Clerk of
Court and the Commission on Audit for its information and
guidance.
SO
x x x x (Emphasis in the original)

ORDERED.

By letter31 of August 15, 2003, Chairman Fernando advised

Sheriff Alejandro Q. Loquinario of the Office of the Clerk of
Court and Ex-Oficio Sheriff, Pasig City RTC that:
1. 1.MMDA has not entered into a new contract for solid
waste management in lieu of JANCOMs Contract.
2. 2.JANCOMs Contract has been referred to the Office of
the President for appropriate action.
3. 3.Without the Presidents approval, JANCOMs Contract
cannot be implemented.32
Petitioners later challenged the RTC June 11, 2003
Order via petition for certiorari33 with prayer for the issuance of

a temporary restraining order and/or writ of preliminary

injunction before the CA. They subsequently filed an Amended
Petition34 on September 26, 2003.
To the Amended Petition JANCOM filed on October 8, 2003 its
Comment35 after which petitioners filed their Reply 36 on
November 24, 2003.
By the challenged Decision of December 19, 2003, the CA
denied the petition and affirmed the June 11, 2003 RTC Order
in this wise:
The Supreme Court ruled that the Jancom contract has the
force of law and the parties must abide in good faith by their
respective contractual commitments. It is precisely this
pronouncement that the alias writ of execution issued by
respondent judge seeks to enforce. x x x
The fact that the Jancom contract has been declared
unimplementable without the Presidents signature, would not
excuse petitioners failure to comply with their undertakings
under Article 18 of the contract. x x x
xxxx
Petitioners complain that respondent judge focused only on
requiring them to perform their supposed obligations under
Article 18 of the contract when private respondents are also
required thereunder to post a Performance Security acceptable
to the Republic in the amount allowed in the BOT Law.
Petitioners complaint is not justified. x x x
xxxx
It cannot x x x be said that respondent judge had been unfair
or one-sided in directing only petitioners to fulfill their own

obligations under Article 18 of the Jancom contract.

Compliance with private respondents obligations under the
contract had not yet become due.

THE
SUBJECT
CONTRACT
ISINEFFECTIVE
AND
UNIMPLEMENTABLE UNTIL AND UNLESS IT IS APPROVED BY
THE PRESIDENT.

xxxx

II

There is no debate that the trial courts Decision has attained

finality. Once a judgment becomes final and executory, the
prevailing party can have it executed as a matter of right and
the granting of execution becomes a mandatory or ministerial
duty of the court. After a judgment has become final and
executory, vested rights are acquired by the winning party. Just
as the losing party has the right to file an appeal within the
prescribed period, so also the winning party has the correlative
right to enjoy the finality of the resolution of the case.

THE SUBJECT CONTRACT ONLY COVERS THE DISPOSITION OF

3,000 TONS OF SOLID WASTE A DAY.

It is true that the ministerial duty of the court to order the

execution of a final and executory judgment admits of
exceptions as (a) where it becomes imperative in the higher
interest of justice to direct the suspension of its execution; or
(b) whenever it is necessary to accomplish the aims of justice;
or (c) when certain facts and circumstances transpired after
the judgment became final which could render the execution of
the judgment unjust. Petitioners have not shown that any of
these exceptions exists to prevent the mandatory execution of
the trial courts Decision.37 (Italics in the original)

III
THE ALLEGED AMENDED AGREEMENT IS ONLY A DRAFT OR
PROPOSAL SUBMITTED BY RESPONDENTS.
IV
RESPONDENTS MUST ALSO BE MADE TO COMPLY WITH THEIR
CONTRACTUAL COMMITMENTS.40 (Italics supplied)
JANCOM filed on September 20, 2004 its Comment 41 on the
petition to which petitioners filed their Reply 42 on January 28,
2005.
On
May
4,
2005,
Jancom
International
filed
its
43
Comment, reiterating its position that it did not authorize the
filing before the RTC by Atty. Molina of the July 29, 2002
Omnibus Motion that impleaded it as party-movant.

Petitioners Motion for Reconsideration 38 having been denied

by the CA by Resolution of May 11, 2004, the present petition
for review39 was filed on July 12, 2004 positing that:

On July 7, 2005, petitioners filed their Reply 44 to Jancom

Internationals Comment.

THE COURT OF APPEALS GRAVELY ERRED IN UPHOLDING THE

LOWER COURT AND IN DISREGARDING THE FOLLOWING
PROPOSITIONS:

Petitioners argue that since the contract remains unsigned by

the President, it cannot yet be executed. Ergo, they conclude,
the proceedings which resulted in the issuance of an alias writ
of execution ran afoul of the [January 30, 2002] decision of
[the Supreme] Court in G.R. No. 147465.45

Petitioners go on to argue that since the contract covers only

3,000 tons of garbage per day while Metro Manila generates at
least 6,000 tons of solid waste a day, MMDA may properly bid
out the other 3,000 tons of solid waste to other interested
groups or entities.
Petitioners moreover argue that the alleged Amended
Agreement concluded supposedly between JANCOM and former
MMDA Chairman Benjamin Abalos is a mere scrap of paper, a
mere draft or proposal submitted by JANCOM to the MMDA, no
agreement on which was reached by the parties; and at all
events, express authority ought to have first been accorded
the MMDA to conclude such an amended agreement with
JANCOM, the original contract having been concluded between
the Republic of the Philippines and JANCOM.
Finally, petitioners argue that respondents should also be
required to perform their commitments pursuant to Article
1846 of the contract.
The petition is impressed with merit in light of the following
considerations.
Section 1, Rule 39 of the Rules of Court provides:
SECTION 1. Execution upon judgments or final orders.
Execution shall issue as a matter of right, on motion, upon a
judgment or order that disposes of the action or proceeding
upon the expiration of the period to appeal therefrom if no
appeal has been duly perfected.
If the appeal has been duly perfected and finally resolved, the
execution may forthwith be applied for in the court of origin,
on motion of the judgment obligee, submitting therewith
certified true copies of the judgment or judgments or final

order or orders sought to be enforced and of the entry thereof,

with notice to the adverse party.
The appellate court may, on motion in the same case, when
the interest of justice so requires, direct the court of origin to
issue the writ of execution.
Once a judgment becomes final, it is basic that the prevailing
party is entitled as a matter of right to a writ of execution the
issuance of which is the trial courts ministerial duty,
compellable by mandamus.47
There are instances, however, when an error may be
committed in the course of execution proceedings prejudicial
to the rights of a party. These instances call for correction by a
superior court, as where:
1. 1)the writ of execution varies the judgment;
2. 2)there has been a change in the situation of the parties
making execution inequitable or unjust;
3. 3)execution is sought to be enforced against property
exempt from execution;
4)it appears that the controversy has never been
submitted to the judgment of the court;
5)the terms of the judgment are not clear enough and
there remains room for interpretation thereof; or
6)it appears that the writ of execution has been
improvidently issued, or that it is defective in
substance, or is issued against the wrong party, or that
the judgment debt has been paid or otherwise
satisfied,
or
the
writ
was
issued
without
48
authority. (Emphasis and Italics supplied)

That a writ of execution must conform to the judgment which is

to be executed, substantially to every essential particular
thereof,49 it is settled. It may not thus vary the terms of the
judgment it seeks to enforce, 50 nor go beyond its terms. Where
the execution is not in harmony with the judgment which gives
it life and exceeds it, it has no validity. 51
This Courts
147465 held:

January

30,

2002

Decision

in G.R.

No.

We, therefore, hold that the Court of Appeals did not err when
it declared the existence of a valid and perfected contract
between the Republic of the Philippines and JANCOM. There
being a perfected contract, MMDA cannot revoke or renounce
the same without the consent of the other. From the moment
of perfection, the parties are bound not only to the fulfillment
of what has been expressly stipulated but also to all the
consequences which, according to their nature, may be in
keeping with good faith, usage, and law (Article 1315, Civil
Code). The contract has the force of law between the parties
and they are expected to abide in good faith by their
respective contractual commitments, not weasel out of them.
Just as nobody can be forced to enter into a contract, in the
same manner, once a contract is entered into, no party can
renounce it unilaterally or without the consent of the other. It is
a general principle of law that no one may be permitted to
change his mind or disavow and go back upon his own acts, or
to proceed contrary thereto, to the prejudice of the other party.
Nonetheless, it has to be repeated that although the
contract is a perfected one, it is still ineffective or
unimplementable until and unless it is approved by the
President.52 (Emphasis and Italics supplied)
This Courts April 10, 2002 Resolution also in G.R. No.
147465 moreover held:

x x x The only question before the Court is whether or not

there is a valid and perfected contract between the parties. As
to the necessity, expediency, and wisdom of the contract,
these are outside the realm of judicial adjudication. These
considerations are primarily and exclusively a matter for the
President to decide. While the Court recognizes that the
garbage problem is a matter of grave public concern, it can
only declare that the contract in question is a valid and
perfected one between the parties, but the same
is stillineffective or unimplementable until and unless it
is approved by the President, the contract itself
providing that such approval by the President is
necessary for its effectivity.53(Emphasis and Italics
supplied)
Article 19 of the contract provides:
Article 19. Effectivity.This Contract shall become effective
upon approval by the President of the Republic of [the]
Philippines pursuant to existing Laws subject to condition
precedent in Article 18. This Contract shall remain in full force
and effect for twenty five (25) years subject to renewal for
another twenty five (25) years from the date of Effectivity.
Such renewal will be subject to mutual agreement of the
parties and approval by the [P]resident of the Republic of [the]
Philippines. (Emphasis and italics supplied)
In issuing the alias writ of execution, the trial court in effect
ordered the enforcement of the contract despite this Courts
unequivocal pronouncement that albeit valid and perfected,
the contract shall become effective only upon approval by the
President.
Indubitably, the alias writ of execution varied the tenor of this
Courts judgment, went against essential portions and
exceeded the terms thereof.

x x x a lower court is without supervisory jurisdiction to

interpret or to reverse the judgment of the higher court x x x.
A judge of a lower court cannot enforce different decrees than
those rendered by the superior court. x x x
The inferior court is bound by the decree as the law of the
case, and must carry it into execution according to the
mandate. They cannot vary it, or examine it for any other
purpose than execution, or give any other or further relief, or
review it upon any matter decided on appeal for error
apparent, or intermeddle with it, further than to settle so much
as has been remanded. x x x54
The execution directed by the trial court being out of harmony
with the judgment, legal implications cannot save it from being
found to be fatally defective.55
Notably, while the trial court ratiocinated that it issued on June
23, 2003 the alias writ to set into motion the legal mechanism
for Presidential approval and signature, 56 it failed to take due
consideration of the fact that during the pendency of the
Omnibus Motion, the contract had earlier been forwarded for
appropriate action on November 3, 2002 by Chairman
Fernando to the Office of the President, with recommendation
for its disapproval, which fact the trial court had been duly
informed
of
through
pleadings
and
open
court
manifestations.57
Additionally, it bears noting that the June 11, 2003 Order of the
trial court is likewise indisputably defective in substance for
having directed the submission of the draft Amended
Agreement to the President.
The appellate court, in affirming the June 11, 2003 Order of the
trial court, overlooked the fact that the Amended Agreement
wasunsigned by the parties and it instead speculated and

rationalized that the submission thereof to the President would

at all events solve the mounting garbage problem in Metro
Manila:
We find that the submission of the Amended Agreement to
the President will break the impasse now existing between the
parties which has effectively halted the governments efforts to
address Metro Manilas mounting garbage problem. x x x
As long as petitioners refuse to deal with private respondents,
the Metro Manila garbage problem will only continue to
worsen. x x x
That the Amended Agreement could have well been
negotiated, if not concluded between private respondents and
the former MMDA administration, is not far-fetched. Petitioners
do not dispute that the President had referred the Jancom
contract to then MMDA Chairman Benjamin Abalos for
recommendation. Petitioners also do not dispute that private
respondents negotiated with the MMDA for the amendment of
the contract.
Besides, the Amended Agreement does not veer away from the
original Jancom contract. x x x58
The Amended Agreement was, as petitioners correctly allege,
merely a draft document containing the proposals of JANCOM,
subject to the approval of the MMDA. As earlier stated, it was
not signed by the parties.59
The original contract itself provides in Article 17.6 that it may
not be amended except by a written [c]ontract signed by the
parties.60
It is elementary that, being consensual, a contract is perfected
by mere consent.61The essence of consent is the conformity of

the parties to the terms of the contract, the acceptance by one

of the offer made by the other; 62 it is the concurrence of the
minds of the parties on the object and the cause which shall
constitute the contract.63 Where there is merely an offer by one
party without acceptance by the other, there is no consent and
the contract does not come into existence.64
As distinguished from the original contract in which this Court
held in G.R. No. 147465:
x x x the signing and execution of the contract by the parties
clearly show that, as between the parties, there was
concurrence of offer and acceptance with respect to the
material details of the contract, thereby giving rise to the
perfection of the contract. The execution and signing of the
contract is not disputed by the parties x x x, 65
the parties did not, with respect to the Amended Agreement,
get past the negotiation stage. No meeting of minds was
established. While there was an initial offer made, there was
no acceptance.
Even JANCOM President Alfonso G. Tuzon conceded, by
letter66 of June 17, 2002 to Chairman Fernando, that the
Amended Agreement was a mere proposal:
Apropos to all these, we are seeking an urgent EXECUTIVE
SESSION on your best time and venue. We can thresh up major
points to establish a common perspective based on data and
merit.
We are optimistic you shall then consider with confidence the
proposed Amended Contract which incorporates the
adjustments we committed to as stated and earlier submitted
to your Office during the incumbency of your predecessor, for

evaluation and appropriate action by NEDA in compliance with

the BOT Law and Article 18.1.1 of our contract. 67
While respondents aver that an acceptance was made, they
have not proffered any proof. While indeed the MMDA, by a
letter68 issued by then MMDA General Manager Jaime Paz,
requested then Secretary of Justice Hernando B. Perez for his
legal opinion on the draft Amended Agreement, nowhere in the
letter is there any statement indicating that the MMDA, or the
Republic of the Philippines for that matter, had approved
respondents proposals embodied in the said draft agreement.
The pertinent portions of the letter read:
Attentio
n:

HON. HERNANDO
B. PEREZ
Secretary

Subject:

Request
for
Opinion Regarding
the
Compromise
Offer of Jancom
Environmental
Corporation
for
the Municipal Solid
Waste
Management
of
Metro Manila

Dear Secretary Perez:

This is to respectfully request for an opinion from your
Honorable Office regarding the Compromise Proposal offered
by JANCOM Environmental Corporation (JANCOM) in relation
to its Contract for the BOT Implementation of the Waste
Management Project for the San Mateo, Rizal Waste Disposal

Site dated 19 December 1997 (hereinafter referred to as the

BOT Contract for brevity) with the Republic of the Philippines.

18.2.1 The BOT COMPANY hereby undertakes to provide the

following within 2 months from execution of this Contract as
an effective document:

xxxx
x x x this representation is requesting your Honorable Office to
render a legal opinion on the following:
Does the offer of JANCOM to temporarily set aside the wasteto-energy plant and implement only the other two major
components of the BOT Contract amount to a novation of the
BOT Contract, and therefore necessitating a re-bidding? If the
same does not amount to a novation, by what authority may
Jancom set aside temporarily a major component of the BOT
Contract?
x x x x69
Only an absolute or unqualified acceptance of a definite offer
manifests the consent necessary to perfect a contract. 70 If at
all, the MMDA letter only shows that the parties had not gone
beyond the preparation stage, which is the period from the
start of the negotiations until the moment just before the
agreement of the parties.71Obviously, other material
considerations still remained before the Amended Agreement
could be perfected. At any time prior to the perfection of a
contract, unaccepted offers and proposals remain as such and
cannot be considered as binding commitments. 72
Respecting petitioners argument that respondents should be
directed to comply with their commitments under Article 18 of
the contract, this Court is not convinced.

1. a)sufficient proof of the actual equity contributions from

the proposed shareholders of the BOT COMPANY in a
total amount not less than PHP 500,000,000 in
accordance with the BOT Law and the implementing
rules and regulations;
2. b)sufficient proof of financial commitment from a
lending institution sufficient to cover total project cost
in accordance with the BOT Law and the implementing
rules and regulations;
3. c)to support its obligation under this Contract, the BOT
COMPANY shall submit a security bond to the CLIENT in
accordance with the form and amount required under
the BOT Law. (Italics supplied)
As this Court held in G.R. No. 147465:
As clearly stated in Article 18, JANCOM undertook to comply
with the stated conditions within 2 months from execution of
the Contract as an effective document. Since the President of
the Philippines has not yet affixed his signature on the
contract, the same has not yet become an effective document.
Thus, the two-month period within which JANCOM should
comply with the conditions has not yet started to run. x x
x73(Italics supplied)
A final point. The argument raised against the authority of Atty.
Molina to file respondents Omnibus Motion before the RTC
does not lie.

Article 18.2.1 of the contract provides:

Representation continues until the court dispenses with the
services of counsel in accordance with Section 26, Rule 138 of

the Rules of Court.74 No substitution of counsel of record is

allowed unless the following essential requisites concur: (1)
there must be a written request for substitution; (2) it must be
filed with the written consent of the client; (3) it must be with
the written consent of the attorney to be substituted; and (4)
in case the consent of the attorney to be substituted cannot be
obtained, there must be at least a proof of notice that the
motion for substitution was served on him in the manner
prescribed by the Rules of Court.75

WHEREFORE, the petition is GRANTED. The Decision dated

December 19, 2003 and Resolution dated May 11, 2004 of the
Court of Appeals in CA-G.R. SP No. 78752 are REVERSED and
SET ASIDE. The June 11, 2003 Order of the Regional Trial Court
of Pasig, Branch 68 in SCA No. 1955 is declared NULL and
VOID.
SO ORDERED.
Quisumbing(Chairperson) and Tinga, JJ., concur.

In the case at bar, there is no showing that there was a valid

substitution of counsel at the time Atty. Molina filed the
Omnibus Motion on July 29, 2002 before the RTC, nor that he
had priorly filed a Withdrawal of Appearance. He thus
continued to enjoy the presumption of authority granted to him
by respondents.
While clients undoubtedly have the right to terminate their
relations with their counsel and effect a substitution or change
at any stage of the proceedings, the exercise of such right is
subject to compliance with the prescribed requirements.
Otherwise, no substitution can be effective and the counsel
who last appeared in the case before the substitution became
effective shall still be responsible for the conduct of the
case.76The rule is intended to ensure the orderly disposition of
cases.77
In the absence then of compliance with the essential
requirements for valid substitution of the counsel of record,
Atty. Molina enjoys the presumption of authority granted to
him by respondents.
In light of the foregoing disquisition, a discussion of the other
matters raised by petitioners has been rendered unnecessary.

Carpio, J., No part, due to inhibition in prior case G.R.

147465.
Velasco, Jr., J., No part due to prior action in CA-G.R. No.
59021 and SP No. 60364.
Petition granted, judgment and resolution reversed and set
aside.
Notes.A writ of execution must conform strictly to the
dispositive portion of the decision sought to be executed. It
may not vary, or go beyond, the terms of the judgment it
seeks to enforce. When the writ does not conform strictly to a
decisions dispositive portion, it is null and void. (Development
Bank of the Philippines vs. Union Bank of the Philippines, 419
SCRA 131 [2004])

G.R. No. 129442. March 10, 1999.

FEDERICO PALLADA, PACIFICO PALLADA, LOURDES
PALLADA and CONSOLACION PALLADA DELGADO, assisted
by her husband, RIZAL DELGADO, PURIFICACION
PALLADA, LOVELLA DELA CRUZ, DIOCESS PALLADA,
NORBERTO
PALLADA,
and
DELFA
PALLADA,
petitioners, vs. REGIONAL TRIAL COURT OF KALIBO,
AKLAN, BRANCH 1, SHERIFF OF THE PROVINCE OF AKLAN
OR ANY OF HIS DEPUTIES, SPOUSES MELDA MERCEDITO
NATAL and CRESENCIO NATAL, SPOUSES EDITHA
MERCEDITA SONGCANG, SPOUSES ELMA MERECEDIO
SAPINIT and ERNESTO SAPINIT, SPOUSES WENINA
MERECEDIO LIM and CONSEI LIM, SPOUSES CELMENCIA
MATIONG SAN MIGUEL and APOLINARIO SAN MIGUEL,
SPOUSES
MERCEDES
MATIONG
TOLENTINO
and
ENRIQUITO TOLENTINO, SPOUSES GLORIA PASTOR and
HELDERICO PASTOR, RENEE MERECEDIO, FIDELINO
MERECEDIO, RUSTICO MATIONG, SALVADOR MATIONG,
JR., and ARTURO MATIONG, respondents.
*

Remedial Law; Pleadings and Practice; The negligence of

counsel binds the client just as the latter is bound by the
mistakes of his lawyer.The negligence of counsel binds the
client just as the latter is bound by the mistakes of his lawyer.
Besides, petitioners are not entirely blameless for the dismissal
of their petition. It was their duty as litigants to keep in
constant touch with their counsel so as to be posted on the
status of their case. As held in Ramones v. National Labor
Relations Commission, [a] prudent man would have taken
steps to ensure that, if and when his counsel would leave for
abroad x x x, any case that his counsel is handling would be
handled by a collaborating counsel or by a new counsel.
Same; Same; Motions; A motion that does not comply with
the requirements of Sections 4 and 5 of Rule 15 of the Rules of
Court is a worthless piece of paper which the clerk of court has

no right to receive and which the court has no authority to act

upon.The foregoing requirementsthat the notice shall be
directed to the parties concerned, and shall state the time and
place for the hearing of the motionare mandatory, and if not
religiously complied with, the motion becomes pro forma. A
motion that does not comply with the requirements of Sections
4 and 5 of Rule 15 of the Rules of Court is a worthless piece of
paper which the clerk of court has no right to receive and
which the court has no authority to act upon.
Same; Same; Same; Under Supreme Court Circular No. 2494, a Motion for the Issuance of a Writ of Execution must
contain a notice to the adverse party.Under Supreme Court
Circular No. 24-94, a Motion for the Issuance of a Writ of
Execution must contain a notice to the adverse party
Execution shall issue as a matter of right, on motion, upon a
judgment or order that disposes of the action or proceeding
upon the expiration of the period to appeal therefrom if no
appeal has been duly perfected. If the appeal has been duly
perfected and finally resolved, such execution may forthwith
be applied for in the lower court from which the action
originated, on motion of the judgment obligee, submitting
therewith certified true copies of the judgment or judgments or
the final order or orders sought to be enforced and of the entry
thereof, with notice to the adverse party. The appellate court
may, on motion in the same case, when the interest of justice
so requires, direct the court of origin to issue the writ of
execution.

SPECIAL CIVIL ACTION in the Supreme Court. Certiorari,

Prohibition and Injunction.
The facts are stated in the opinion of the Court.
E.M. Andrade Law Office for petitioners.
Pedro M. Icamina for private respondents.
PURISIMA, J.:

At bar is a Petition for Certiorari, Prohibition and

Injunction assailing the validity, and seeking nonimplementation of the Writ of Execution issued on May 2,
1997 in Civil Case No. 2519 before Branch 1 of the
Regional Trial Court in Kalibo, Aklan.
The facts that matter are as follows:
On September 29, 1976, private respondents
commenced Civil Case No. 2519 for recovery of
possession and ownership of land with damages before
Branch 1 of the Regional Trial Court in Kalibo, Aklan
(RTC-Aklan).
On January 31, 1991, RTC-Aklan declared the
defendants, petitioners herein, as the absolute and lawful
owners and possessors of subject land; disposing, thus:
WHEREFORE, judgment is hereby rendered declaring
defendants the absolute and lawful owners and possessors of
the lot in question as against the plaintiffs. No pronouncement
as to costs.
SO ORDERED.

Private respondents appealed the said decision to the

Court of Appeals which reversed and set aside the same;
disposing as follows:
WHEREFORE, in view of all the foregoing, the appeal is
GRANTED, the judgment appealed from is hereby REVERSED
AND SET ASIDE and a new decision rendered in favor of herein
appellants declaring them as the possessors and lawful owners
of the remaining portion of the unsold land (1,0391 hectares
more or less) covered by Tax Declaration No. 10336 (Exh. G).
Defendants-appellees are hereby ordered to
possession of said land to plaintiffs-appellants herein.

restore

Defendants-appellees are likewise ordered to pay jointly and

severally plaintiffs-appellants the value of the produce of the
land, the same to be computed from 1976, at the time of the
filing of the complaint until fully paid.

Costs is charged against defendants-appellees.

SO ORDERED.

Petitioners Motion for Reconsideration was to no avail. It

was denied in the Resolution dated July 18, 1996 of the
Court of Appeals.
Undaunted, petitioners found their way to this
courtvia the Petition for Review on Certiorari under
consideration, docketed as G.R. No. 126112. But the
same was denied in the Resolution of November 18,
1996, which disposition became final and executory on
January 22, 1997.
On May 13, 1997, the private respondents filed
anExParte Motion for Execution with RTC-Aklan, which
granted the said motion.
The respondent court then issued the Writ of
Execution dated May 2, 1997 (private respondents claim
that the same is erroneous as its date should have been
June 2, 1997)directing the Sheriff of the Province of Aklan
or any of his deputies to implement subject Decision,
thus:
3

NOW, THEREFORE, upon payment of your lawful fees, you are

hereby ordered to enforce, implement and/or execute the
aforesaid decision of the Court of Appeals promulgated on
March 29, 1996, which REVERSED and SET ASIDE the decision
appealed from and a new decision rendered in favor of herein
plaintiffsappellants having been DISMISSED by the Supreme
Court in its Resolution dated November 18, 1996.
You are further commanded to collect from the defendants
jointly and severally, the value of the produce of the land, the
same to be computed from 1976, at the time of the filing of
the complaint until fully paid, and tender the same to the
plaintiffs.
In case you fail to collect the amount in cash, then you may
levy upon the chattels and other personal properties of the

defendants. But if sufficient personal properties cannot be

found to satisfy this execution, and your lawful fees thereon,
then you are commanded that of the lands and buildings of
said defendants, you make the said sum of money in the
manner required by law and the Rules of Court and return this
writ unto this Court within SIXTY (60) days from receipt with
your corresponding report of the proceedings undertaken
thereon.

Execution was partially satisfied, as shown in the Officers

Return of Service of June 20, 1997. With the issuance of
the Writ of Execution under attack, petitioners have come
to this Court for relief, theorizing that:
8

I
PETITIONERS ARE NOT BOUND BY THE NEGLIGENCE OF THEIR
COUNSEL WHO LEFT THE COUNTRY WITHOUT INFORMING
THEM THEREOF, NOR BRIEFING THEM OF THE STATUS OF
THEIR CASE.
II
THE WRIT OF EXECUTION IS INVALID FOR PRIVATE
RESPONDENTS EX-PARTE MOTION FOR EXECUTION WAS
GRANTED WITHOUT NOTICE TO PETITIONERS.
III
THE PETITIONERS CASE IS MERITORIOUS.

On the first issue, petitioners maintain that before their

petition for review on certiorari, docketed as G.R. No.
126112, was resolved by this Court, their lawyer went
abroad without informing them and without briefing them
on the status of the petition. According to petitioners, it
was only on June 16, 1997 that they learned that their
petition was dismissed. It is therefore petitioners stance
that they lost the said case before this Court due to the
negligence of their lawyer which should not bind them.

Petitioners contention is untenable. The negligence of

counsel binds the client just as the latter is bound by the
mistakes of his lawyer. Besides, petitioners are not
entirely blameless for the dismissal of their petition. It
was their duty as litigants to keep in constant touch with
their counsel so as to be posted on the status of their
case. As held in Ramones v. National Labor Relations
Commission, [a] prudent man would have taken steps
to ensure that, if and when his counsel would leave for
abroad x x x, any case that his counsel is handling would
be handled by a collaborating counsel or by a new
counsel.
Here, petitioners have no proof other than their bare
allegation, that they were unaware of the departure of
their lawyer for abroad.
Even assuming arguendo that petitioners counsel was
negligent, their Petition in G.R. No. 126112 would fail just
the same, for as held by the Court in its Resolution of
November 18, 1996, the Court of Appeals committed no
reversible error in its questioned judgment:
9

10

11

At any rate, even if the said requirement were complied with

and the petition were filed on time, the same would
nevertheless be dismissed for failure to sufficiently show that
the Court of Appeals had committed any reversible error in the
questioned judgment.
12

Anent the second error, there is tenability in petitioners

contention that the Writ of Execution was irregularly
issued insofar as the Ex-Parte Motion for Execution of
private respondents did not contain a notice of hearing to
petitioners. Sections 4 and 5 of Rule 15 of the Revised
Rules of Court, read:
SEC. 4. Notice.Notice of a motion shall be served by the
applicant to all parties concerned, at least three (3) days
before the hearing thereof, together with a copy of the motion,
and of any affidavits and other papers accompanying it. The

court, however, for good cause may hear a motion on shorter

notice, specially on matters which the court may dispose of on
its own motion.
SEC. 5. Contents of notice.The notice shall be directed to
the parties concerned, and shall state the time and place for
the hearing of the motion.

The foregoing requirementsthat the notice shall be

directed to the parties concerned, and shall state the
time and place for the hearing of the motionare
mandatory, and if not religiously complied with, the
motion becomes pro forma. A motion that does not
comply with the requirements of Sections 4 and 5 of Rule
15 of the Rules of Court is a worthless piece of paper
which the clerk of court has no right to receive and which
the court has no authority to act upon.
Under Supreme Court Circular No. 24-94, a Motion for
the Issuance of a Writ of Execution must contain a notice
to the adverse party
13

14

Execution shall issue as a matter of right, on motion, upon a

judgment or order that disposes of the action or proceeding
upon the expiration of the period to appeal therefrom if no
appeal has been duly perfected.
If the appeal has been duly perfected and finally resolved,
such execution may forthwith be applied for in the lower court
from which the action originated, on motion of the judgment
obligee, submitting therewith certified true copies of the
judgment or judgments or the final order or orders sought to
be enforced and of the entry thereof, with notice to the
adverse party.
The appellate court may, on motion in the same case, when
the interest of justice so requires, direct the court of origin to
issue the writ of execution. (italics supplied)

It bears stressing that a similar provision is found in

Section 1 of Rule 39 of the 1997 Revised Rules of Court.

The Court is not prepared, however, to invalidate the Writ

of Execution issued below. The petition is obviously a
dilatory move on the part of petitioners, designed to
prevent the final disposition of the case. InPeople v.
Leviste, it was held that:
15

While it is true that any motion that does not comply with the
requirements of Rule 15 should not be accepted for filing and,
if filed, is not entitled to judicial cognizance, this Court has
likewise held that where a rigid application of the rule will
result in a manifest failure or miscarriage of justice,
technicalities may be disregarded in order to resolve the case.
Litigations should, as much as possible be decided on the
merits and not on technicalities.

And in Nasser v. Court of Appeals, et al.:

16

Litigation must at some time be terminated, even at the risk

of occasional errors, for public policy dictates that once a
judgment becomes final, executory and unappealable, the
prevailing party should not be denied the fruits of his victory
by some subterfuge devised by the losing party. x x x

The Court need not rule on the third issue, the same
having been resolved with finality in G.R. No. 126112. A
decision that has become final and executory can no
longer be disturbed.
WHEREFORE, the petition is hereby DISMISSED, for want
of merit. Costs against the petitioners.
SO ORDERED.
Romero (Chairman),Vitug, Panganiban andGonzag
aReyes, JJ., concur.
Petition dismissed.
Note.A notice of hearing addressed to the clerk of
court and not to the parties is no notice at allthe rule
commanding the movant that the notice of hearing shall
be directed to the parties concerned does not provide for
17

any qualification much less exception. (Chua vs. Court of

Appeals, 271 SCRA 546[1997])

LYDIA LAO, WILLIAM CHUA LIAN, JEFFREY ONG and HENRY

SY, petitioners, vs. PHILIP KING, respondent.
Judgments; The order of execution may not vary, or go
beyond, the terms of the judgment it seeks to enforce.It
is a fundamental legal axiom that an order of execution
must substantially conform to the dispositive portion of
the decision sought to be executed. The order of
execution may not vary, or go beyond, the terms of the
judgment it seeks to enforce. If it does, the order is null
and void.
Same; Republic Act No. 8799; The prevailing party has
the right to file a motion for the immediate execution of a
decision or judgment.It bears stressing that under
Section 4, Rule 1 of the Interim Rules of Procedure
Governing Intra-Corporate Controversies under Republic
Act No. 8799, the prevailing party has the right to file a
motion for the immediate execution of a decision or
judgment.
The
law
explicitly
provides:
Section
4. Executory nature of decisions and orders.All
decisions and orders issued under these Rules shall
immediately be executory. No appeal or petition taken
therefrom shall stay the enforcement or implementation
of the decision or order, unless restrained by an appellate
court. Interlocutory orders shall not be subject to appeal.
PETITION for review on certiorari of a decision of the
Court of Appeals.
The facts are stated in the opinion of the Court.
Allan Rufo L. Yap for petitioners.
Eduardo V. De Mesa,Priscilla N. Fernando andNoel
Briones Damot for respondent.
GARCIA, J.:

In this petition for review on certiorari under Rule 45 of

the Rules of Court, herein petitioners Lydia Lao, William
Chua Lian, Jeffrey Ong and Henry Sy assail and seek to
set aside the Decision dated April 30, 2003 of the Court
of Appeals (CA) in CA-G.R. SP No. 74948, as reiterated in
its Resolution of October 13, 2003, which held that Judge
Apolinario D. Bruselas, Jr., presiding judge, Regional Trial
Court (RTC) of Quezon City, Branch 93, did not abuse his
discretion in granting the respondents motion for
execution in Civil Case No. Q-01-42972.
The facts:
Petitioners and respondent Philip King are stockholders
of the Philadelphia School, Inc., an educational institution
with principal office in Quezon City. The school was
organized in 1970 with an authorized capital stock of
P2,000,000.00, of which 4,600 shares have been
subscribed and paid-up.
Respondents father, Ong Seng, had the most number
of the subscribed shares totaling 1,200. Before his death
in 1994, Ong Seng requested for the transfer of his shares
of stock to his eldest son, Felimon Ong, who was later
known as Philip King, the herein respondent. Ong Sengs
request was duly approved by the board of directors of
the corporation in its meeting on December 17, 1993.
Since then, the respondent had been consistently elected
as a member of the board since 1994.
On May 23, 1998, a special meeting of the
stockholders was held, resulting in the election of a new
set of directors and officers. Respondent was elected as
vice-president while petitioners Lydia Lao and William
Chua Lian were elected as school administrator and
assistant treasurer, respectively. Following the election,
the new board passed a resolution designating the
signatories of the corporation for its bank accounts,
namely, Yao Bio Lim who was elected as president, Betty
1

Lao who was elected as treasurer, petitioner Chua Lian,

and the herein respondent. Thereafter, Yao Bio Lim and
the respondent, duly introduced to the school community
as the newly-elected president and vice-president,
respectively, acted as such.
Barely four months after the May 23, 1998 special
stockholders meeting, petitioner Lydia Lao wrote a letter
to the corporate president Yao Bio Lim questioning the
validity of said meeting and the elections resulting
therefrom on the ground that the respondent was allowed
to vote his 1,200 shares despite the fact that 700 of
which remained unpaid. In the same letter, petitioner
Lydia Lao insisted that the old board, of which she was
the president, should continue to govern the corporation.
Further, on August 15, 1998, petitioner Lao issued a
Secretarys Certificate to the effect that the board held a
meeting on that same date and passed a resolution
declaring null and void the transfer to the respondent of
his fathers shares in the corporation. Thereafter,
petitioner Lao continued to represent herself as the
corporations president with authority to withdraw funds
from its bank accounts.
Then, in April 1999, the respondent learned that
petitioner Lao had filed with the Securities and Exchange
Commission (SEC) a General Information Sheet (GIS)
showing that a stockholders meeting was held on March
19, 1999 during which Lao herself and the other
petitioners herein, namely, Chua Lian, Jeffrey Ong and
Henry Sy, were allegedly elected as new members of the
board. In the same GIS, it is also indicated that the
respondents shares were only 500 instead of 1,200.
On account of the petitioners failure to notify the
respondent of the alleged stockholders meetings on
August 15, 1998 and on March 19, 1999, coupled with
their refusal to recognize his ownership of the 1,200

corporate shares of stock, the respondent filed with the

SEC a petition to enjoin the herein petitioners from
representing themselves as officers and members of the
board of directors of the Philadelphia School, Inc. and to
nullify all acts done and resolutions passed by them. The
petition was docketed as SEC Case No. 05-99-6297.
While the case was pending with the SEC, Republic Act
No. 8799, otherwise known as theSecurities Regulation
Code, took effect. The statute transferred the jurisdiction
over intra-corporate disputes from the SEC to the
RTCs. Consequent thereto, SEC Case No. 05-99-6297 was
transferred to the RTC of Quezon City, whereat it was
docketed as Civil Case No. Q-01-42972 and raffled to
Branch 93 thereof presided by Judge Apolinario D.
Bruselas, Jr.
On September 25, 2002, Judge Bruselas, Jr. rendered
his decision in the case, the decretal portion of which
reads:
3

WHEREFORE, the foregoing premises considered, the court

finds for the [respondent] and as prayed for, hereby orders as
follows:
1. 1)The meetings held by the [petitioners] on 15 August
1998 and all acts performed by them as the alleged
officers and Board of Directors of the corporation are
declared null and void:
2. 2)The alleged election of [petitioner] Lydia Lao as
president and other [petitioners] as members of the
Board of Directors of the corporation during the
aforementioned meeting, declared null and void;
3. 3)The reduction in the shareholdings of [the respondent]
from 1,200 shares to only 500 shares, declared null and
void; the shares of the [respondent] should be restored
to 1,200 and which number he is entitled to vote;

4. 4)The increase in the number of the shares of Mr. Sy

Tian Ting and Dy Siok Bee, declared null and void;
5)The [petitioners] to account for the funds of the
corporation disbursed by them during the period they
took control;
6)The new elections of the corporate directors and
officers should be based on the shareholdings reflected
in the Articles of Incorporation modified only by such
transfers as may be shown to be valid and legitimate.
SO ORDERED. (Words in brackets supplied.)

On October 14, 2002, the petitioners filed a Notice of

Appeal. Four days later, or on October 18, 2002, the
respondent filed with the same court a Motion for
Execution, invoking Section 4, Rule 39, of the Rules of
Court.
On December 26, 2002, Judge Bruselas, Jr. issued
an Order granting the respondents motion for execution.
In full, the Order runs:
5

Section 4, Rule 1 of the Interim Rules of Procedure Governing

Intra-Corporate Controversies Under Republic Act No. 8799
provides as follows:
Section 4 Executory nature of decisions and orders.All decisions
and orders issued under these Rules shall immediately be executory.
No appeal or petition taken therefrom shall stay the enforcement or
implementation of the decision or order, unless restrained by an
appellate court. Interlocutory orders shall not be subject to appeal.
In its judgment, the court ruled in favor of the [respondent] who now
invokes the aforecited provisions in enforcing said judgment.

Given the clear provision of the interim rules, the court

cannot give credence to the [petitioners] Notice of Appeal.
ACCORDINGLY, the court resolves to grant [respondents]
motion for execution as it hereby GRANTS the same.

LET therefore a writ of execution be issued in accordance

with the disposition of the issues as contained in the judgment
of the court.
SO ORDERED. (Words in brackets supplied.)

From the aforequoted Order, the petitioners went on

certiorari to the CA whereat their recourse was docketed
as CA-G.R. SP No. 74948, imputing grave abuse of
discretion on the part of Judge Bruselas, Jr. in issuing said
Order. To the petitioners, the Order issued by the judge
varied the terms of the judgment inCivil Case No. Q-0142972sought to be executed in the respondents motion
for execution.
In a decision dated April 30, 2003, the CA rejected the
imputation of grave abuse of discretion against the judge
and accordingly dismissed the petitioners certiorari
recourse. Partly says the appellate court in its decision:
6

A cursory reading of the questioned motion reveals that what

was sought for therein was really the execution of the
Judgment of 25 September 2002. Hence, in paragraph 2
thereof, King cited Section 4, Rule 39 of the Rules of Court to
emphasize that the nature of the aforesaid judgment was that,
it was enforceable upon rendition.
xxx

xxx

xxx

The public respondent categorically stated that the writ to

be issued must be in accordance with the disposition of the
issues as contained in the judgment of 25 September 2002.
Clearly, the public respondent minced no words in mandating
that the writ to be issued must conform substantially to every
essential particular of the judgment promulgated. In short, the
writ must be issued in accordance with the grant. x x x. It must
conform, more particularly, to that ordained or decreed in the
dispositive portion of the decision.

Thus, when respondent court issued the order dated 26

December 2002 it did not do so with grave abuse of discretion
amounting to excess or lack of jurisdiction.

With their motion for reconsideration having been denied

by the CA in its reiteratory resolution of October 13, 2003,
the petitioners are now with this Court via this petition for
review submitting for our consideration the following
issues:
1.(a)Whether an order of execution which granted a
motion for execution praying for reliefs not
included in the decretal portion of the judgment as
well as for reliefs prayed for in another case is
valid.
2.(b)Whether a motion for execution which prays for
reliefs not included in the decretal portion of the
judgment as well as for reliefs prayed for in
another case is legally defective and should be
denied.
We DENY.
Prescinding from the premise that the trial judges
Order of December 26, 2002, granting the respondents
motion for execution in Civil Case No. Q-01-42972, varied
the terms of the judgment rendered in that case, the
petitioners contend that the Order in question is a nullity.
To them, the respondents motion for execution which
was granted under the questioned Order prayed for
reliefs not included in the decretal portion of the decision
rendered in the main case.
In fine, the issues raised essentially boil down to the
question of whether or not the subject Order and the
respondents motion for execution are at variance with

the decretal portion of the judgment dated September

25, 2002.
Concededly, it is a fundamental legal axiom that an
order of execution must substantially conform to the
dispositive portion of the decision sought to be executed.
The order of execution may not vary, or go beyond, the
terms of the judgment it seeks to enforce. If it does, the
order is null and void.
But did the Order herein involved really vary the terms
of the judgment it seeks to execute? It did not.
For emphasis, we restate the dispositive portion of the
trial courts decision of September 25, 2002 in Civil Case
No. Q-01-42972:
7

WHEREFORE, the foregoing premises considered, the court

finds for the [respondent] and as prayed for, hereby orders as
follows:
1. 1)The meetings held by the [petitioners] on 15 August
1998 and all acts performed by them as the alleged
officers and Board of Directors of the corporation are
declared null and void;
2. 2)The alleged election of [petitioner] Lydia Lao as
president and other [petitioners] as members of the
Board Of Directors of the corporation during the
aforementioned meeting, declared null and void;
3. 3)The reduction in the shareholdings of [respondent]
from 1,200 shares to only 500 shares, declared null and
void; the shares of the [respondent] should be restored
to 1,200 and which number he is entitled to vote;
4. 4)The increase in the number of the shares of Mr. Sy
Tian Ting and Dy Siok Bee, declared null and void;

5. 5)The [petitioners] to account for the funds of the

corporation disbursed by them during the period they
took control;
6. 6)The new elections of the corporate directors and
officers should be based on the shareholdings reflected
in the Articles of Incorporation modified only by such
transfers as may be shown to be valid and legitimate.
SO ORDERED. (Words on brackets supplied.)

On the other hand, the Order in question reads in part:

8

ACCORDINGLY, the court resolves to grant plaintiffs motion

for execution as it hereby GRANTS the same.
LET therefore a writ of execution be issued in accordance
with the disposition of the issues as contained in the
judgment of the court.

executed. As it were, the petitioners basic premise in this

case is simply faulty. It follows that the jurisprudence
relied upon by them finds no application herein.
Petitioners insist, however, that the respondents
motion for execution is at variance with the September
25, 2002 judgment because the motion prayed for reliefs
not included in the dispositive portion of the decision. To
prove their point, the petitioners cite the respondents
prayers in his motion for execution, to wit:
WHEREFORE, premises considered, it is respectfully prayed
that, to give immediate effect to the judgment dated 25
September 2002 of the Honorable Court, an order be issued:
1. 1.Enjoining respondents [herein petitioners] from
continuing to act as the President and members of the
Board of Directors of Philadelphia School, Inc.

SO ORDERED. (Emphasis supplied.)

The Court does not find any inconsistency between the

trial courts September 25, 2002 judgment and its Order
of December 26, 2002. Quite the contrary, a careful
perusal of the two readily discloses the erroneous
assumption of the petitioners that the latter varies the
former. As it is, the Order stresses that the writ of
execution to be issued pursuant thereto must be in
accordance with the disposition of the issues as
contained in the judgment of the court. In short, the
Order directs in no uncertain terms that the writ must
conform with the judgment of September 25, 2002 as
embodied in the dispositive portion of its decision. The
Order is categorical and unequivocal in its language. It is
in harmony with the judgment it seeks to enforce. The
alleged variance is a mere imagination of the petitioners.
Hence, it is futile for them to lay stress on established
jurisprudence that an order of execution cannot vary nor
go beyond the terms of the judgment sought to be

2.Directing the immediate holding of a new election

under the supervision of representatives of the
Honorable Court wherein petitioner [herein respondent]
will be allowed to vote his 1,200 shares and Sy Tian Tin
and Dy Siok Bee prevented from voting more than 300
and 50 shares respectively.
3.Declaring illegal the declaration by [petitioners] of 300
percent stock dividends and enjoining them from allowing
the supposed stock dividends from being voted.
4.Directing the newly elected officers and members of the
Board of Directors of Philadelphia School, Inc. to pay
[respondent] his 100 percent cash dividends.
5.Directing [petitioners] to immediately render an
accounting of the finances of the corporation and allowing

[respondent] to examine the corporate and financial

records of the corporation.
Other reliefs which are just and equitable under the premises
are likewise prayed for. (Words in brackets supplied.)
9

We are far from convinced

To our mind, there is no significant point of variance
between the judgment and the respondents motion for
execution. For sure, the reliefs prayed for by the
respondent in his motion are intertwined with the
disposition of issues in the trial courts decision of
September 25, 2002, as contained in its dispositive
portion.
First, the respondents prayer to enjoin the herein
petitioners from continuing to act as officers and
members of the board of directors is obviously consistent
with the first item in the decretal portion of the decision
which states that all acts performed by the herein
petitioners as the alleged officers and members of the
board are null and void. Inasmuch as the trial court
declared all acts done by the petitioners as null and void,
it is only appropriate for the respondent to ask that the
petitioners be prohibited from continuing to act as
officers and members of the board.
Second, the respondents prayer to hold a new election of
officers to allow him to vote his 1,200 shares and to
prevent Sy Tian Tin and Dy Siok Bee from voting more
than 300 and 50 shares, respectively, is indubitably in
consonance with the following pronouncements in the
dispositive portion of the trial courts decision: (1) the
election of the petitioners as officers and members of the
board is null and void, (2) the shareholdings of the
respondent should be restored to 1,200 which number he
is entitled to vote, (3) the increase in the number of
shares of Sy Tian Tin (from 300 to 400 shares) and that of
Dy Siok Bee (from 50 to 100 shares) is null and void, and

(4) the new elections of the corporate directors and

officers should be based on the shareholdings of the
stockholders.
Third, the respondents prayer that the petitioners
should immediately render an accounting of the finances
of the corporation clearly conforms with the judgment
ordering the petitioners to account for the funds which
they disbursed during the time they took control of the
corporation.
Thus, the alleged variance between the trial courts
decision
of
September
25,
2002
and
the
respondentsMotion for Execution is mere figment of the
petitioners imagination. As we see it, the reliefs sought
by the respondent in his said motion are merely the
logical and necessary consequences of the judgment
rendered by Judge Bruselas, Jr. in his decision in Civil Case
No. Q-01-42972.
Besides, and as correctly pointed out by the CA, the
respondents motion prayed for the issuance of an order
of execution so as to give immediate effect to the
judgment dated 25 September 2002. This only
shows that the respondent merely intended to enforce
the necessary implications of what was adjudged by the
trial court in its decision.
Too, the petitioners might have lost sight of the fact
that there was no order by the trial court which
specifically granted the reliefs prayed for by the
respondent. As it is, the questioned Order merely
directed, in general terms, the issuance of a writ of
execution in accordance with the courts resolution of the
issues, as embodied in the dispositive portion of its
decision. Clearly, the Order did not grant any relief not
otherwise granted in the decision of September 25, 2002.
Finally, it bears stressing that under Section 4, Rule 1
of the Interim Rules of Procedure Governing Intra-

Corporate Controversies under Republic Act No. 8799, the

prevailing party has the right to file a motion for the
immediate execution of a decision or judgment. The law
explicitly provides:
Section 4. Executory nature of decisions and orders.All
decisions and orders issued under these Rules shall
immediately be executory. No appeal or petition taken
therefrom shall stay the enforcement or implementation of the
decision or order, unless restrained by an appellate court.
Interlocutory orders shall not be subject to appeal.

WHEREFORE, the petition is DENIED and the assailed

decision of the CA is AFFIRMED.
Costs against the petitioners.
SO ORDERED.
Puno (Chairperson),Sandoval-Gutierrez an
dAzcuna, JJ., concur.
Corona, J., On Leave.

AGUSTIN DORMITORIO and LEONCIA D. DORMITORIO,

petitioners,vs. HONORABLE JOSE FERNANDEZ, Judge of
the Court of First Instance of Negros Occidental, Branch V,
Bacolod City, and SERAFIN LAZALITA, respondents.
Judgments; Execution;Compromise agreement; A final and
executory judgment of a trial court may be novated by
subsequent agreement of the parties.What was done by
respondent Judge in setting aside the writ of execution in Civil
Case No. 5111 finds support in the applicable authorities.
There is this relevant excerpt in Barretto v. Lopez, this Court
speaking through the then Chief Justice Paras: Alleging that
the respondent judge of the municipal court had acted in
excess of her jurisdiction and with grave abuse of discretion in
issuing the writ of execution of December 15, 1947, the
petitioner has filed the present petition for certiorari and
prohibition for the purpose of having said writ of execution
annulled. Said petition is meritorious. The agreement filed by
the parties in the ejectment case created as between them
new rights and obligations which naturally superseded the
judgment of the municipal court. In Santos v. Acua, it was
contended that a lower court decision was novated by the
subsequent agreement of the parties. Implicit in this Courts
ruling is that such a plea would merit approval if indeed that
was what the parties intended. x x x Again, the present case is
far stronger, for there is a later decision expressly superseding
the earlier one relied upon on which the writ of execution
thereafter set aside was based.
Same; Same; Same; A decision based on a compromise
agreement has the effect of res judicata.Nor can it be denied
that as the later decision in Civil Case No. 6553 was the result
of a compromise, it had the effect of res judicata. This was
made clear in Salazar v. Jarabe.

Same; Same; Same; Motion

for
reconsideration; Due
process;There is no denial of due process where adverse
parties were given the opportunity to file a motion for
reconsideration of an order which was issued pursuant to a
petition filed without prior notice to them.There is no merit
likewise to the point raised by petitioners that they were not
informed by respondent Judge of the petition by private
respondent to set aside the writ of execution. The order
granting such petition was the subject of a motion for
reconsideration. The motion for reconsideration was thereafter
denied. Under the circumstances, the failure to give notice to
petitioners had been cured. That is a well-settled doctrine.
Their complaint was that they were not heard. They were given
the opportunity to file a motion for reconsideration. So they
did. That was to free the order from the alleged infirmity.
Petitioners cannot be heard to claim that they were denied
procedural due process.

ORIGINAL ACTION in the Supreme Court. Certiorari and

mandamus.
The facts are stated in the opinion of the Court.
Graciano H. Arinday,Jr. for petitioners.
Antonio L. Balinas for respondent.
FERNANDO, Acting C.J.:
The filing of this suit for certiorari could have been
avoided had there full awareness by petitioners of the
legal import and significance of a later decision involving
the parties. If such were the case, they would have
realized that no grave abuse of discretion, no abuse of
discretion for that matter, could be imputed to
respondent
Judge
for
issuing
the
challenged
order, setting aside a writ of execution conformably to a
petition for relief by private respondent Serafin
Lazalita. Insofar as pertinent, it is worded thus: That the
1

above-mentioned order of Execution to be set aside is

based on the decision of the Honorable Court dated
September 5, 1961 in the above-entitled case which is no
longer enforceable, and executory by virtue of the
Agreed Stipulation of Facts entered into by the Plaintiffs
and Defendants in Civil Case No. 6553, and which said
Agreed Stipulation of Facts was the basis for the
judgment of the Honorable Court dated February 12,
1965. That the parties and subject matter inCivil Case No.
5111 andCivil Case No. 6553 are the same except that
the plaintiffs in Civil Case No. 5111 were the defendants
in Civil Case No. 6553, and vice-versa; * * * That in the
Agreed Stipulation of Facts in Civil Case No. 6553 which
was the basis of the Honorable Court judgment dated
February 12, 1965, it was agreed by the defendant
spouses Dormitorio, who are the plaintiffs in Civil Case
No. 5111 that the defendant Serafin Lazalita should be
reimbursed for his expenses in transferring his house to
another Lot to be assigned to him by the Municipality of
Victorias, and that the Decision in Civil Case No.
5111 shall not be enforced and executed anymore; That
by means of fraud, misrepresentation and concealment of
the true facts of the case, the plaintiffs were able to
mislead the Honorable Court, thru an Ex-Parte Motion to
issue bymistake an Order for the issuance of a Writ of
Execution by making this Honorable Court believe that
the Decision of September 5, 1961 is still enforceable and
executory; * * * Respondent Judge granted the relief
prayed for and set aside the writ of execution, in view of
the conclusion reached by him that such later decision,
arrived at as the result of a compromise between the
same parties, evidenced by the agreed stipulation of
facts, was clear proof of an animus novandiand thus
superseded the previous judgment which as a result of
an ex parte motion was mistakenly ordered executed.
3

Such a conclusion is borne out by a study of the records

of the case. Certiorari does not lie.
The decision in the aforecited Civil Case No. 6553,
which as contended by private respondent, a submission
that earned the approval of respondent Judge, sufficed for
the lifting of the writ of execution, pursuant to the
decision inCivil Case No. 5111 deemed superseded,
started with a stipulation of facts. Thus: When this case
was called for hearing the parties submitted an Agreed
Stipulation of Facts duly signed by the parties and their
respective counsel, as follows: [Agreed Stipulation of
Facts], Come now the parties, in the above-entitled case,
represented by their respective counsel and before this
Honorable Court, respectfully submit the following agreed
stipulation of facts: 1. That the defendant Municipality of
Victorias, is the owner of several parcels of lands in
Victorias, Negros Occidental, known as Lots Nos. 102 and
120 and 138 and 102-New, which [are] consolidated and
subdivided into small lots for sale to the inhabitants
thereof; the lots were sold by the Municipality, either in
cash or installment for ten (10) years at [one peso]
(P1.00) per square meter; 2. That on December 7, 1948,
the plaintiff Serafin Lazalita, bought from the Municipality
of Victorias, Lot No. 1, Block 16 of the consolidatedsubdivision plan PCs-118 having an area of Two Hundred
Thirty (230) Square Meters, payable in installment at [one
peso] (P1.00) per square meter, and in the year 1958,
upon full payment by plaintiff Lazalita of the purchase
price of the land, a deed of definite sale was executed in
his favor by the then Municipal Mayor Montinola of
Victorias, Negros Occidental, and thereafter a Certificate
of Title No. T-23098 covering the property, was issued
him by the Register of Deeds of Bacolod, Negros
Occidental; 3. That from February 7, 1948, until about
eight continuous years thereafter, plaintiff had been in

full and peaceful possession of the said land, and he

introduced permanent and valuable improvements
thereon, [namely] fruit trees, like coconuts, avocados,
pumelos and oranges, which have long been fruit
bearing, and built a house of strong materials, valued at
P5,000.00; 4. That plaintiff Lazalita, was placed in
possession of the said Lot No. 1, Block 16 of the
subdivision plan of Victorias, by the persons designated
by the Municipality to take charge of the sale of said lots
to the people, and from the time, he had occupied by
same, up to the present, there has not been a change in
the location thereof, as described in the Certificate of
Title covering the property, now registered in plaintiffs
name; 5. That about the year 1955, however, the other
co-defendants hereinthe spouses Agustin Dormitorio
and Leoncia D. Dormitorio, purchased also, from the
defendant Municipality of Victorias, their lot known as Lot
2, Block 16, of the same consolidation-subdivision plan
PCs-118, having an area of Three Hundred Forty-Three
(343) Square meters, in cash, at [one peso] (P1.00) per
square meter. Immediately thereafter, the Dormitorios,
obtained a transfer Certificate of Title known as T-18189
for their property, from the Office of the Register of
Deeds, Bacolod, Negros Occidental. However, the
spouses Dormitorio, have not taken actual possession of
the land, they have purchased from the defendant
Municipality of Victorias, up to the present; 6. That on
December 12, 1958, the spouses Dormitorio, brought a
suit against the plaintiff Lazalita, for Ejectment and the
conflict between them was made known to the office of
the Municipal Mayor and the Council of Victorias, who
tried to settle the matter between the partiesDormitorio
and Lazalita. Later, a private Land Surveyor, was hired by
the Municipality of Victorias, and it was found out,
according to said Surveyor, Mr. Ceballos, that the Lot sold
by the Municipality of Victorias, to the plaintiff, was

converted into the new Municipal Road known as Jover

Street and that the lot presently occupied by him, is
supposed to be the lot No. 2, bought by the spouses
Dormitorio from the Municipality of Victorias; and so,
availing of the said discovery, the Court of First Instance
of Negros Occidental, Branch V, Presided over by Hon.
Jose F. Fernandez, rendered judgment in that case No.
5111, in favor of Dormitorio, ordering the plaintiff herein
Lazalita, to vacate the land and to pay a monthly rental of
P20.00, to said Dormitorio, besides his Attorneys fees; 7.
That Lazalita, having failed to appeal from said judgment
in Civil Case No. 5111 of this Honorable Court, brought
this present action, against the Municipality of Victorias,
and joined the Dormitorios, as formal parties, because of
the value of his permanent improvements and building
introduced or constructed on Lot No. 2, Block 16,
ascertained to be that, very lot purchased by Dormitorio
from the defendant Municipality of Victorias, which
building and improvements, have far exceed then, the
original purchase price of the land; 8. That the present
fair market value of residential lots in the Poblacion of
Victorias, ranges between P15.00 to P25.00 per square
meter and the lots in controversy, are saleable at
present, at P20.00 per square meter; 9. That the
Municipality
of
Victorias,
under
the
present
administration, is willing to amicably settle the case, now
before this Honorable Court, by giving the plaintiff
another lot, if they could open their newly proposed
subdivision, or pay back Lazalita the amount necessary
and just for plaintiff to acquire another lot for his
residence, and for the expenses of transferring his
present residential house thereto. * * *. Then, as noted
in the decision, the parties did respectfully pray that
judgment be rendered by this Honorable Court, on the
basis of the foregoing agreed stipulation of facts, and on
such other basis just and equitable, without special
4

pronouncement of costs. So it was granted in the

dispositive portion of such decision: [Wherefore],
judgment is hereby rendered in accordance with the
above-mentioned Agreed Stipulation of Facts. grave
abuse of discretion when he set aside the writ of
execution is thus clearly apparent. He had no choice on
the matter. That was made even more evident in the
answer to the petition filed by respondents. It must have
been the realization by petitioners that certiorari certainly
did not lie that led to their not only failing to make an
attempt at a refutation of what was asserted in the
answer but also failing to appear at the hearing when this
case was set for oral argument. As noted at the outset,
this petition must be dismissed.
1. What was done by respondent Judge in setting aside
the writ of execution inCivil Case No. 5111 finds support
in the applicable authorities. There is this relevant
excerpt in Barretto v. Lopez, this Court speaking through
the then Chief Justice Paras: Alleging that the respondent
judge of the municipal court had acted in excess of her
jurisdiction and with grave abuse of discretion in issuing
the writ of execution of December 15, 1947, the
petitioner has filed the present petition for certiorari and
prohibition for the purpose of having said writ of
execution annnulled. Said petition is meritorious. The
agreement filed by the parties in the ejectment case
created as between them new rights and obligations
which naturally superseded the judgment of the
municipal court. In Santos v. Acua, it was contended
that a lower court decision was novated by subsequent
agreement of the parties._Implicit in this Courts ruling is
that such a plea would merit approval if indeed that was
what the parties intended. Nonetheless, it was not
granted, for as explained by the ponente, Justice J.B.L.
Reyes: Appellants understood and expressly agreed to
5

be bound by this condition, when they stipulated that

they will voluntarily deliver and surrender possession of
the premises to the plaintiff in such event * * *. Hence, it
is plain that in no case were the subsequent
arrangements entered into with any unqualified intention
to discard or replace the judgment in favor of the plaintiffappellee; and without such intent or animus novandi, no
substitution of obligations could possibly take place. Can
there be any doubt that if it could be shown, as it was in
this case, that there was such clear manifestation of will
by the parties, the original decision had lost force and
effect? To ask the question is to answer it. The presence
of theanimus novandi is undeniable. Nor is there anything
novel in such an approach. So it was noted by then Chief
Justice Concepcion in De los Santos v. Rodriguez: As
early as Molina v. De la Riva the principle has been laid
down that, when, after judgment has become final, facts
and circumstances transpire which render its execution
impossible or unjust, the interested party may ask the
court to modify or alter the judgment to harmonize the
same with justice and the facts Molina v. de la Riva was
a 1907 decision. Again, the present case is far stronger,
for there is a later decision expressly superseding the
earlier one relied upon on which the writ of execution
thereafter set aside was based.
10

11

12

13

2.Nor can it be denied that as the later decision

in Civil Case No. 6553 was the result of a
compromise, it had the effect of res judicata. This was
made clear inSalazar v. Jarabe. There are later
decisions to the same effect. The parties were,
therefore, bound by it. There was thus an element of
bad faith when petitioners did try to evade its terms.
At first, they were quite successful. Respondent
Judge, however, upon being duly informed, set
matters right. He set aside the writ of execution. That
14

15

was to act in accordance with law. He is to be

commended, not condemned.
3.There is no merit likewise to the point raised by
petitioners that they were not informed by
respondent Judge of the petition by private
respondent to set aside the writ of execution. The
order granting such petition was the subject of a
motion
for
reconsideration. The
motion
for
reconsideration was thereafter denied. Under the
circumstances, the failure to give notice to petitioners
had been cured. That is a well-settled doctrine. Their
complaint was that they were not heard. They were
given the opportunity to file a motion for
reconsideration. So they did. That was to free the
order from the alleged infirmity. Petitioners then
cannot be heard to claim that they were denied
procedural due process.
WHEREFORE, the petition for certiorari is dismissed. Costs
against petitioners.
Barredo, Antonio,Aquino and Concepcion Jr., JJ.,
concur.
Petition dismissed.
Notes.If the writ of execution does not conform to
the judgment, the writ may be amended so that the
judgment may be properly satisfied. (De Venecia vs. Del
Rosario, 18 SCRA 792).
While under the provisions of Section 50, Rule 39,
Rules of Court, a judgment for a sum of money rendered
by a foreign court is presumptive evidence of a right as
between the parties and their successors in interest by a
subsequent title, but when suit for its enforcement is
brought in a Philippine court, said evidence may be
repelled by evidence of clear mistake of law. (Nagarmull
vs. Binalbagan-Isabeh Sugar Co., Inc., 33 SCRA 46).
16

17

18

Where it is claimed that the questioned order or writ of

execution varied the terms of the decision being executed
and that the petitioner was deprived of his day in Court in
its issuance, the relief afforded to the parties may be
pursued either by an appeal or by other proceeding
appropriate and allowable under the Rules of Court.
(Romero, Sr. vs. Court of Appeals, 40 SCRA 172).

BACHRACH
CORPORATION,
petitioner,vs. THE
HONORABLE COURT OF APPEALS and PHILIPPINE PORTS
AUTHORITY, respondents.
Judgments; Res Judicata;The essential conditions which
must concur in order that res judicata may effectively apply.
There are four (4) essential conditions which must concur in
order that res judicata may effectively apply, viz.: (1) the
judgment sought to bar the new action must be final; (2) the
decision must have been rendered by a court having
jurisdiction over the subject matter and the parties; (3) the
disposition of the case must be a judgment or order on the
merits; and (4) there must be between the first and second
action identity of parties, identity of subject matter, and
identity of causes of action.
Actions; Contracts; Words and Phrases; Cause of Action,
Defined; In a breach of contract, the contract violated is the
subject matter while the breach thereof by the obligor is the
cause of action.A cause of action, broadly defined, is an act
or omission of one party in violation of the legal right of the
other. The subject matter, on the other hand, is the item with
respect to which the controversy has arisen, or concerning
which the wrong has been done, and it is ordinarily the right,
the thing, or the contract under dispute. In a breach of
contract, the contract violated is the subject matter while the
breach thereof by the obligor is the cause of action.
Same; Same; Res
Judicata;The
ultimate
test
in
ascertaining the identity of causes of action is said to be to
look into whether or not the same evidence fully supports and
establishes both the present cause of action and the former
cause of action.The ultimate test in ascertaining the identity
of causes of action is said to be to look into whether or not the
same evidence fully supports and establishes both the present
cause of action and the former cause of action. In the
affirmative, the former judgment would be a bar; if otherwise,

then that prior judgment would not serve as such a bar to the
second. The evidence needed to establish the cause of action
in the unlawful detainer case would be the lease contract and
the violation of that lease by Bachrach. In the specific
performance case, what would be consequential is evidence of
the alleged compromise agreement and its breach by PPA.
Same; Same; Injunctions;After a judgment has gained
finality, it becomes the ministerial duty of the court to order its
execution; No court should interfere by injunction or otherwise
to restrain such execution; Exceptions.The rule indeed is,
and has almost invariably been, that after a judgment has
gained finality, it becomes the ministerial duty of the court to
order its execution. No court, perforce, should interfere by
injunction or otherwise to restrain such execution. The rule,
however, concededly admits of exceptions; hence, when facts
and circumstances later transpire that would render execution
inequitable or unjust, the interested party may ask a
competent court to stay its execution or prevent its
enforcement. So, also, a change in the situation of the parties
can warrant an injunctive relief.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Gutierrez, Sundiam & Villanueva for petitioner.
The Government Corporate Counsel for Phil. Ports
Authority.
VITUG,J.:
Bachrach Corporation (Bachrach), in its petition for
review on certiorari,questions the decision of the Court of
Appeals in CA-G.R. SP No. 38763, promulgated on 12
November 1996, the dispositive part of which reading
WHEREFORE, the petition is granted. The assailed RTC
orders are hereby NULLIFIED and SET ASIDE and public

respondent is ordered to dismiss the subject action before him

under Civil Case No. 95-73399. No pronouncement as to
costs. on several counts; viz.:
1

1. I.THE COURT OF APPEALS GRAVELY ERRED IN NOT

DISMISSING CA-G.R. SP NO. 38673 DESPITE THE FACT
THAT A SIMILAR PETITION EARLIER FILED BY PPA WAS
DISMISSED FOR BEING INSUFFICIENT NOT ONLY IN
FORM BUT ALSO IN SUBSTANCE WHICH DISMISSAL
CONSTITUTES RES JUDICATA INSOFAR AS THE ISSUES
RAISED THEREIN ARE CONCERNED.
2. II.THE COURT OF APPEALS GRAVELY ERRED IN RULING
THAT THE DECISION IN THE UNLAWFUL DETAINER CASE
CONSTITUTES RES JUDICATA WHICH BARS THE SPECIFIC
PERFORMANCE CASE.
3. III.THE COURT OF APPEALS GRAVELY ERRED IN RULING
THAT THE FILING OF THE SPECIFIC PERFORMANCE
CASE VIOLATES THE RULE AGAINST FORUM SHOPPING.
4. IV.THE COURT OF APPEALS GRAVELY ERRED IN RULING
THAT THE WRIT OF PRELIMINARY INJUNCTION ISSUED
BY THE TRIAL COURT CONSTITUTES INTERFERENCE
WITH ITS JUDGMENT IN THE UNLAWFUL DETAINER
CASE.
5. V.THE COURT OF APPEALS GRAVELY ERRED IN
ORDERING THE DISMISSAL OFCIVIL CASE NO. 9573399 THEREBY RULING ON THE MERITS OF THE CASE
WHEN IN FACT, THE ONLY ISSUES FOR ITS RESOLUTION
WERE THE PROPRIETY OF THE WRIT OF PRELIMINARY
INJUNCTION ISSUED BY THE TRIAL COURT AND THE
DENIAL OF PPAS MOTION FOR PRELIMINARY HEARING
ON AFFIRMATIVE DEFENSES.
2

It would appear that petitioner corporation entered into

two lease contracts with the Philippine government

covering two specified areas, Block 180 and Block 185,

located at the Manila Port Area, then under the control
and management of the Director of Lands, for a term of
ninety-nine years each, the first lease to expire on 19
June 2017 and the other on 14 February 2018. During her
tenure, President Corazon Aquino issued Executive Order
No. 321 transferring the management and administration
of the entire Port Area to herein respondent Philippine
Ports Authority (PPA). Shortly after its take-over, PPA
issued a Memorandum increasing the rental rates of
Bachrach by 1,500%. Bachrach refused to pay the
substantial increased rates demanded by PPA.
On 23 March 1992, PPA initiated unlawful detainer
proceedings, docketed Civil Case No. 138838 of the
Metropolitan Trial Court (MeTC) of Manila, against
Bachrach for nonpayment of rent. On 27 April 1993, MeTC
rendered a decision ordering the eviction of Bachrach
from the leased premises. Bachrach appealed to the
Regional Trial Court (RTC) of Manila which, on 21
September 1993, affirmed the decision of the lower
court in toto.
Bachrach elevated the case to the Court of Appeals by
way of a petition for review. On 29 July 1994, the
appellate court affirmed the decision of the RTC. A motion
for reconsideration was filed by Bachrach; however, the
resolution of the motion was put on hold pending
submission of a compromise agreement. When the parties
failed to submit the promised compromise agreement,
the Court of Appeals, on 15 May 1995, denied Bachrachs
motion for reconsideration. The decision of the appellate
court in the ejectment suit became final and executory on
20 May 1995.
Meanwhile on 28 March 1995, while the motion for
reconsideration was yet pending with the appellate court,
Bachrach filed a complaint against PPA with the Manila
3

RTC, docketedCivil Case No. 95-73399(hereinafter

referred to also as the specific performance case), for
refusing to honor a compromise agreement said to have
been perfected between Bachrach and PPA during their
04 February 1994 conference that superseded the
ejectment case. In its complaint, Bachrach prayed for
specific performance.
On 08 June 1995, PPA filed a motion for a writ of
execution/garnishment in the ejectment case. The next
day, 09 June 1995, Bachrach filed an application in the
specific performance case for the issuance of a temporary
restraining order and/or a writ of preliminary injunction to
enjoin
the
MeTC
from
issuing
the
writ
of
execution/garnishment. PPA countered by filing a motion
for preliminary hearing on its affirmative defenses along
the same grounds mentioned in its motion to dismiss the
specific performance case, to wit: (a) the pendency of
another action between the same parties for the same
cause; (b) the violation of the anti-forum-shopping rule;
(c) the complaints lack of cause of action; and (d) the
unenforceable character of the compromise agreement
invoked by Bachrach. On 13 July 1995, the trial court
issued an omnibus order, granting the application of
Bachrach for a writ of preliminary injunction, in this tenor

PREMISES CONSIDERED, this Court is of the opinion and so

holds (1) that plaintiff (Bachrach) is entitled to the injunctive
relief prayed for and upon the posting of a bond in the amount
of P300,000.00, let a writ of preliminary injunction be issued
enjoining the defendant (PPA), the Presiding Judge of the
Metropolitan Trial Court of Manila, Branch 2 from issuing a writ
of execution/garnishment in Civil Case No. 238838-CV entitled
Philippine Ports Authority vs. Bachrach Corporation; (2)
lifting/setting aside the order dated June 5, 1995 and (3)

denying defendants motion for a preliminary hearing on

affirmative defenses.
6

PPA moved for reconsideration of the above order but

the trial court denied the plea in its order of 29 August
1995.
On 25 September 1995, PPA filed a petition
forcertiorari and prohibition, with application for the
issuance of a temporary restraining order and/or writ of
preliminary injunction, docketed CA-G.R. SP No. 38508,
before the Court of Appeals. The petition was dismissed
by resolution, dated 28 September 1995, of the appellate
court for being insufficient in form and substance, i.e., the
failure of PPA to properly attach a certified true copy each
of the assailed order of 13 July 1995 and 29 August 1995
of the trial court. PPA received on 05 October 1995 a copy
of the resolution, dated 28 September 1995, of the
appellate court. Undaunted, PPA filed a new petition on
11 October 1995, now evidently in proper form,
asseverating that since it had received a copy of the
assailed resolution of the trial court only on 07 September
1995, the refiling of the petition with the Court of Appeals
within a period of less than two months from the date of
such receipt was well within the reasonable time
requirement under the Rules for a special civil action
for certiorari. In the meantime, the resolution, dated 28
September 1995, of the Court of Appeals which
dismissed CA-G.R. No. 38508 became final on 21 October
1995.
In its newly filed petition, docketed CA-G.R. SP No.
38673, PPA invoked the following grounds for its
allowance:
7

I.That respondent Judge acted without, or in excess of

jurisdiction, or with grave abuse of discretion when it
issued a writ of preliminary injunction against the final and

executory resolution of the Honorable Court of Appeals

(Annex I) inspite of the well-established rule thatcourts
are not allowed to interfere with each others judgment or
decrees by injunction,and worse, in this case,against the
execution of the judgment of a superior or collegiate court
which had already become final and executory.
II.That respondent Judge acted without, or in excess of
jurisdiction, or with grave abuse of discretion when it also
denied petitioners motion for a preliminary hearing on its
affirmative defenses or in failing to have the case below
outrightly dismissed on the grounds stated in its
affirmative defenses, when respondent Judge pronounced
there is noidentity as to the causes of action between the
case decided by the Court of Appeals (CA-G.R. SP No.
32630) and the case below (Civil Case No. 95-73399)
when clearly the causes of action in both cases revolve on
the same issue of possession of the subject leased
premises.
III.That respondent Judge acted without, or in excess of
jurisdiction, or with grave abuse of discretion in refusing to
take cognizance (of), abide (by) and acknowledge the final
judgment of the Court of Appeals which, on said ground
alone, is enough justification for the dismissal of the case
grounded on res judicata. Moreover private respondent is
guilty of forum-shoppingand the penalty therefor is the
dismissal of its case.
10

On 12 November 1996, the Court of Appeals rendered

the assailed decision nullifying and setting aside the
orders of the RTC and ordering the latter to dismiss the
specific performance case.
The Court finds merit in the instant appeal interposed
by petitioner.

Verily, the decisive issue raised by the parties before

the Court in the instant petition is whether or not the
specific performance case (Civil Case No. 73399) should
be held barred by the unlawful detainer case on the
ground of res judicata. There are four (4) essential
conditions which must concur in order that res
judicata may effectively apply, viz.: (1) the judgment
sought to bar the new action must be final; (2) the
decision must have been rendered by a court having
jurisdiction over the subject matter and the parties; (3)
the disposition of the case must be a judgment or order
on the merits; and (4) there must be between the first
and second action identity of parties, identity of subject
matter, and identity of causes of action. There is no
question about the fact that all the first three elements
of res judicata are here extant; it is the final condition
requiring an identity of parties, of subject matter and of
causes of action, particularly the last two, i.e., subject
matter and cause of action, that presents a problem.
A cause of action, broadly defined, is an act or
omission of one party in violation of the legal right of the
other. The subject matter, on the other hand, is the item
with respect to which the controversy has arisen, or
concerning which the wrong has been done, and it is
ordinarily the right, the thing, or the contract under
dispute. In a breach of contract, the contract violated is
the subject matter while the breach thereof by the obligor
is the cause of action. It would appear quite plain then
that the RTC did act aptly in taking cognizance of the
specific performance case. In Civil Case No. 138838 of the
MeTC, the unlawful detainercase, the subject matter is
the contract of lease between the parties while the
breach thereof, arising from petitioners non-payment of
rentals, constitutes the suits cause of action. In Civil
Case No. 73399 of the RTC, the specific performance
11

12

13

case, the subject matter is the compromise agreement

allegedly perfected between the same parties while the
cause of action emanates from the averred refusal of PPA
to comply therewith. The ultimate test in ascertaining the
identity of causes of action is said to be to look into
whether or not the same evidence fully supports and
establishes both the present cause of action and the
former cause of action. In the affirmative, the former
judgment would be a bar; if otherwise, then that prior
judgment would not serve as such a bar to the
second. The evidence needed to establish the cause of
action in the unlawful detainer case would be the lease
contract and the violation of that lease by Bachrach. In
the specific performance case, what would be
consequential is evidence of the alleged compromise
agreement and its breach by PPA.
The next thing to ask, of course, would be the question
of whether or not the issuance by the trial court of the
writ of preliminary injunction was an improper
interference with the judgment in the unlawful detainer
suit. It could be argued that, instead of filing a separate
action for specific performance, Bachrach should just
have presented the alleged compromise agreement in the
unlawful detainer case. Unfortunately, the refusal of PPA
to honor the agreement after its alleged perfection
effectively prevented Bachrach from seeking the coercive
power of the court to enforce the compromise in the
unlawful detainer case. The situation virtually left
Bachrach with but the remedy of independently initiating
the specific performance case in a court of competent
jurisdiction. In its challenged decision, the Court of
Appeals, on its part, has said that respondent PPAs
prayer for the issuance of a writ of execution and
garnishment is but the necessary and legal consequence
of its affirmance of the lower courts decision in the
14

unlawful detainer case which has by then become final

and executory. The rule indeed is, and has almost
invariably been, that after a judgment has gained finality,
it becomes the ministerial duty of the court to order its
execution. No court, perforce, should interfere by
injunction or otherwise to restrain such execution. The
rule, however, concededly admits of exceptions; hence,
when facts and circumstances later transpire that would
render execution inequitable or unjust, the interested
party may ask a competent court to stay its execution or
prevent its enforcement. So, also, a change in the
situation of the parties can warrant an injunctive
relief. Evidently, in issuing its orders of 13 July 1995 and
29 August 1995 assailed by PPA in the latters petition for
certiorari and prohibition before the Court of Appeals, the
trial court in the case at bar would want to
preservestatus quo pending its disposition of the specific
performance case and to prevent the case from being
mooted by an early implementation of the ejectment writ.
In holding differently and ascribing to the trial court grave
abuse of discretion amounting to lack or excess of
jurisdiction, the appellate court, in our considered view,
has committed reversible error.
Having reached the above conclusions, other incidental
issues raised by petitioner no longer need to be passed
upon.
WHEREFORE, the petition is GRANTED. The decision of
the Court of Appeals is reversed and set aside; Civil Case
No. 73399 along with the assailed orders of the Regional
Trial Court, aforedated, are hereby reinstated. No costs.
SO ORDERED.
Davide,
Jr. (Chairman),Bellosillo, Panganiban andQuisumbing,
JJ., concur.
15

16

17

18

DAVID SO, petitioner, vs.COURT OF APPEALS AND

PEOPLE OF THE PHILIPPINES, respondents.
Criminal Law; Batas Pambansa Blg. 22; Penalty;Doctrine
enunciated in the Vaca case, and reiterated in Rosa Lim vs.
People of the Philippines adopted by the Court as a policy on
the matter of the imposition of penalties for violations of Batas
Pambansa Blg. 22 under Administrative Circular No. 12-2000.
The doctrine enunciated in the Vaca case, and reiterated
in Rosa Lim vs. People of the Philippines, was eventually
adopted by this Court as a policy on the matter of the
imposition of penalties for violations of B.P. Blg. 22, under
Administrative Circular No. 12-2000 issued on November 12,
2000.
Same; Same; Same;Administrative Circular No. 13-2001
vests in the courts the discretion to determine, taking into
consideration the peculiar circumstances of each case,
whether the imposition of fine alone would best serve the
interests of justice, or whether forbearing to impose
imprisonment would depreciate the seriousness of the offense,
work violence on the social order, or otherwise be contrary to
the imperatives of justice.In accord with this policy,
Administrative Circular No. 13-2001 issued on February 14,
2001 vests in the courts the discretion to determine, taking
into consideration the peculiar circumstances of each case,
whether the imposition of fine alone would best serve the
interests of justice, or whether forbearing to impose
imprisonment would depreciate the seriousness of the offense,
work violence on the social order, or otherwise be contrary to
the imperatives of justice.
Remedial Law; Judgments;Execution; The rule that it is the
ministerial duty of the court to order the execution of a final
judgment admits of certain exceptions.Admittedly, the
decision in Criminal Case Nos. 8345 and 8346 has become
final. Nevertheless, the rule that it is the ministerial duty of the
court to order the execution of a final judgment admits of

certain exceptions. Thus, in the case ofPeople vs. Gallo, we

held that the court has the authority to suspend the execution
of a final judgment or to cause a modification thereof as and
when it becomes imperative in the higher interest of justice or
when supervening events warrant it.

MANIFESTATION AND MOTION in the Supreme Court.

The facts are stated in the resolution of the Court.
Carpio, Carpio, Carpio& Carpio for petitioner.
Viola and Guadiz co-counsel for petitioner.
Agoot, Buensuceso & Associates for Faustino Puzon.
The Solicitor Generalfor the People.
R E S OL U T I O N
PUNO, J.:
For resolution are the Urgent Manifestation of an
Extraordinary
Supervening
Event dated
February
7,2002, and Motion for Suspension of Execution and
Modification of Judgment dated February 14, 2002, filed
by petitioner David So, as well as the Consolidated
Comment filed by the Office of the Solicitor General.
On August 21, 2001, we affirmed the decision of the
Court of Appeals in CA-G.R. SP No. 49680 denying the
petition for certiorari with prayer for preliminary
injunction seeking to restrain the execution of the
judgment of the Regional Trial Court in Criminal Case Nos.
8345 and 8346 finding petitioner guilty of violation of B.P.
Blg. 22.
On September 25, 2001, petitioner So filed a Motion for
New
Hearing
relying
on
the
promulgation
of
Administrative Circular Nos. 12-2000 and 13-2001 which
establish a rule of preference in the imposition of the
penalties under B.P. Blg. 22, wherein a fine instead of
imprisonment may be imposed upon the discretion of the
1

judge. Thereafter, petitioner So filed a Motion for

Reconsideration of the Courts decision alleging basically
the same arguments. In a Resolution dated January 16,
2002, both motions were denied.
On February 11, 2002, petitioner So filed an Urgent
Manifestation of an Extraordinary Supervening Event
alleging that he underwent a serious triple heart bypass
at the Makati Medical Center on January 21, 2002, and
that to impose imprisonment upon him is a sentence of
death. He seeks a retroactive application of
Administrative Circular No. 12-2000 in his favor and prays
that, for humanitarian grounds, a fine instead of
imprisonment be imposed.
Petitioner also filed a Motion for Suspension of
Execution and Modification of Judgment, contending that
his having undergone open heart surgery warrants, for
humanitarian reasons and in the higher interest of justice,
the suspension of the execution of the judgment of
conviction and the modification of the sentence from
imprisonment to a fine in double the amount of the
checks subject of this petition.
In its Consolidated Comment, the Office of the Solicitor
General averred that in the cases of Vaca vs. Court of
Appeals and Rosa Lim vs. People of the Philippines, this
Court deleted the penalty of imprisonment and imposed
only a fine equivalent to double the amount of the checks
involved. It held that it would best serve the ends of
criminal justice if in fixing the penalty within the range of
discretion allowed by Section 1, paragraph 1 of B.P. Blg.
22, the same philosophy underlying the Indeterminate
Sentence Law is observed, namely, that of redeeming
valuable human material and preventing unnecessary
deprivation of personal liberty and economic usefulness
with due regard to the protection of the social order. It
submits the resolution of the foregoing motions to the
3

sound discretion of this Court in accordance with

Administrative Circular No. 13-2001.
The dispositive portion of the decision in Criminal Case
Nos. 8345 and 8346 reads as follows:
WHEREFORE, finding the accused guilty beyond reasonable
doubt in the two above-entitled cases, the Court hereby
sentences the accused as follows:
In Crim. Case No. 8345: To suffer imprisonment of one (1)
year; to indemnify the offended party, Faustino Puzon, the sum
of P6,000.00, Philippine Currency; and to pay the costs.
In Crim. Case No. 8346: To suffer imprisonment of one (1)
year; to indemnify the offended party, Faustino Puzon, the sum
of P28,600.00, Philippine Currency; and to pay the costs.
5

In the cited case of Vaca vs. Court of Appeals, the

petitioners were convicted of violation of B.P. Big. 22 and
were sentenced to one year imprisonment and to pay a
fine of P10,000.00. The Court, however, took into
consideration the advanced age of one of the accused
and the fact that all the accused were first offenders, and
deleted the sentence of imprisonment and ordered the
payment of double the amount of the checks involved. It
rationalized, viz:
6

x x x Petitioners are first-time offenders. They are Filipino

entrepreneurs who presumably contribute to the national
economy. Apparently, they brought this appeal, believing in all
good faith, although mistakenly, that they had not committed
a violation of B.P. Big. 22. Otherwise, they could simply have
accepted the judgment of the trial court and applied for
probation to evade a prison term. It would best serve the ends
of criminal justice if in fixing the penalty within the range of
discretion allowed by 1, par. 1, the same philosophy
underlying the Indeterminate Sentence Law is observed,
namely, that of redeeming valuable human material and
preventing unnecessary deprivation of personal liberty and

economic usefulness with due regard to the protection of the

social order. In this case we believe that fine in an amount
equal to double the amount of the check involved is an
appropriate penalty to impose on each of the petitioners.

The doctrine enunciated in the Vaca case, and reiterated

in Rosa Lim vs. People of the Philippines, was eventually
adopted by this Court as a policy on the matter of the
imposition of penalties for violations of B.P. Blg. 22, under
Administrative Circular No. 12-2000 issued on November
12, 2000.
In accord with this policy, Administrative Circular No.
13-2001 issued on February 14, 2001 vests in the courts
the discretion to determine, taking into consideration the
peculiar circumstances of each case, whether the
imposition of fine alone would best serve the interests of
justice, or whether forbearing to impose imprisonment
would depreciate the seriousness of the offense, work
violence on the social order, or otherwise be contrary to
the imperatives of justice.
In the case at bar, the medical certificate issued by Dr.
Froilan L. Navarro states that as a consequence of the
coronary artery triple bypass operation of petitioner So,
the patient is still weak, depressed, recuperating from
the surgical procedure. He could not stand stressful
situation and physical activities. He needs coronary
rehabilitation for at least one year under direct
supervision of a coronary care therapist. It is our
considered opinion that the present physical condition of
petitioner So presents a compelling reason to modify the
decision of the trial court and impose, in lieu of
imprisonment, a fine in an amount equal to double the
amount of the checks involved.
Admittedly, the decision in Criminal Case Nos. 8345
and 8346 has become final. Nevertheless, the rule that it
is the ministerial duty of the court to order the execution
7

of a final judgment admits of certain exceptions. Thus, in

the case of People vs. Gallo, we held that the court has
the authority to suspend the execution of a final
judgment or to cause a modification thereof as and when
it becomes imperative in the higher interest of justice or
when supervening events warrant it.
WHEREFORE, the motion for suspension of execution
and modification of judgment is GRANTED and the
decision in Criminal Case Nos. 8345 and 8346 is hereby
MODIFIED by deleting the sentence of imprisonment and
ordering petitioner David So to pay a fine equivalent to
double the amount of the checks involved.
SO ORDERED.
Davide, Jr. (C.J., Chairman) and Ynares-Santiago,
J., concur.
Motion granted, judgment modified.
Notes.The penalty of imprisonment for violation of
Batas Pambansa Big. 22 has been deleted in Vaca vs.
Court of Appeals, 298 SCRA 658 (1998).
The philosophy is to redeem valuable human material
and to prevent unnecessary deprivation of personal
liberty of the accused. (Lira vs. People, 340 SCRA
497 [2000])
9

JAMES
REBURIANO
and
URBANO
REBURIANO,
petitioners, vs.HONORABLE COURT OF APPEALS, and
PEPSI COLA BOTTLING COMPANY OF THE PHILIPPINES,
INC., respondents.
Actions; Appeals; Writs of Execution; As a general rule, no
appeal lies from an order denying a Motion to Quash Writ of
Execution; Exceptions.The question is whether the order of
the trial court denying petitioners Motion to Quash Writ of
Execution is appealable. As a general rule, no appeal lies from
such an order, otherwise litigation will become interminable.
There are exceptions, but this case does not fall within any of
such exceptions. In Limpin, Jr. v. Intermediate Appellate Court,
this Court held: Certain, it is, . . . that execution of final and
executory judgments may no longer be contested and
prevented, and no appeal should lie therefrom; otherwise,
cases would be interminable, and there would be negation of
the overmastering need to end litigations. There may, to be
sure, be instances when an error may be committed in the
course of execution proceedings prejudicial to the rights of a
party. These instances, rare though they may be, do call for
correction by a superior court, as where1) the writ of
execution varies the judgment; 2) there has been a change in
the situation of the parties making execution inequitable or
unjust; 3) execution is sought to be enforced against property
exempt from execution; 4) it appears that the controversy has
never been submitted to the judgment of the court; 5) the
terms of the judgment are not clear enough and there remains
room for interpretation thereof; or, 6) it appears that the writ
of execution has been improvidently issued, or that it is
defective in substance, or is issued against the wrong party, or
that the judgment debt has been paid or otherwise satisfied, or
the writ was issued without authority.
Same; Same; Same; While parties are given a remedy
from a denial of a motion to quash or recall writ of execution,

it is equally settled that the writ will not be recalled by reason

of any defense which could have been made at the time of the
trial of the case.In this case, petitioners anchored their
Motion to Quash on the claim that there was a change in the
situation of the parties. However, a perusal of the cases which
have recognized such a ground as an exception to the general
rule shows that the change contemplated by such exception is
one which occurred subsequent to the judgment of the trial
court. Here, the change in the status of private respondent
took place in 1983, when it was dissolved, during the
pendency of its case in the trial court. The change occurred
prior to the rendition of judgment by the trial court. It is true
that private respondent did not inform the trial court of the
approval of the amended articles of incorporation which
shortened its term of existence. However, it is incredible that
petitioners did not know about the dissolution of private
respondent considering the time it took the trial court to
decide the case and the fact that petitioner Urbano Reburiano
was a former employee of private respondent. As private
respondent says, since petitioner Reburiano was a former sales
manager of the company, it could be reasonably presumed
that petitioners knew of the changes occurring in respondent
company. Clearly, the present case does not fall under the
exception relied upon by petitioners and, the Court of Appeals
correctly denied due course to the appeal. As has been noted,
there are in fact cases which hold that while parties are given a
remedy from a denial of a motion to quash or recall writ of
execution, it is equally settled that the writ will not be recalled
by reason of any defense which could have been made at the
time of the trial of the case.
Same; Same; Same; Rules of fair play, justice, and due
process dictate that parties cannot raise for the first time on
appeal from a denial of a Motion to Quash a Writ of Execution
issues which they could have raised but never did during the
trial and even on appeal from the decision of the trial court.

The Court of Appeals also held that in any event petitioners

cannot raise the question of capacity of a dissolved
corporation to maintain or defend actions previously filed by or
against it because the matter had not been raised by
petitioners before the trial court nor in their appeal from the
decision of the said court. The appellate court stated: x x x We
agree with this ruling. Rules of fair play, justice, and due
process dictate that parties cannot raise for the first time on
appeal from a denial of a Motion to Quash a Writ of Execution
issues which they could have raised but never did during the
trial and even on appeal from the decision of the trial court.
Same; Judgments;Corporation
Law; Dissolution
of
Corporations; In the absence of any trustee designated after
the dissolution of a corporation, the counsel who prosecuted
and defended the interest of the corporation and who in fact
appeared in behalf of the corporation may be considered a
trustee of the corporation at least with respect to the matter in
litigation only.Indeed, in Gelano vs. Court of Appeals, a case
having substantially similar facts as the instant case, this Court
held: However, a corporation that has a pending action and
which cannot be terminated within the three-year period after
its dissolution is authorized under Sec. 78 [now 122] of the
Corporation Law to convey all its property to trustees to enable
it to prosecute and defend suits by or against the corporation
beyond the three-year period. Although private respondent did
not appoint any trustee, yet the counsel who prosecuted and
defended the interest of the corporation in the instant case
and who in fact appeared in behalf of the corporation may be
considered a trustee of the corporation at least with respect to
the matter in litigation only. Said counsel had been handling
the case when the same was pending before the trial court
until it was appealed before the Court of Appeals and finally to
this Court. We therefore hold that there was substantial
compliance with Sec. 78 [now 122] of the Corporation Law
and such private respondent Insular Sawmill, Inc. could still

continue prosecuting the present case even beyond the period

of three (3) years from the time of dissolution . . . . [T]he
trustee may commence a suit which can proceed to final
judgment even beyond the three-year period. No reason can
be conceived why a suit already commenced by the
corporation itself during its existence, not by a mere trustee
who, by fiction, merely continues the legal personality of the
dissolved corporation should not be accorded similar
treatment and allowed to proceed to final judgment and
execution thereof.
Same; Same; Same; Same;The board of directors may be
permitted to complete the corporate liquidation by continuing
as trustees by legal implication.In the Gelanocase, the
counsel of the dissolved corporation was considered a trustee.
In the later case of Clemente v. Court of Appeals, we held that
the board of directors may be permitted to complete the
corporate liquidation by continuing as trustees by legal
implication. For, indeed, as early as 1939, in the case
ofSumera v. Valencia, this Court held: It is to be noted that the
time during which the corporation, through its own officers,
may conduct the liquidation of its assets and sue and be sued
as a corporation is limited to three years from the time the
period of dissolution commences; but there is no time limit
within which the trustees must complete a liquidation placed in
their hands. It is provided only (Corp. Law, Sec. 78 [now Sec.
122]) that the conveyance to the trustees must be made
within the three-year period. It may be found impossible to
complete the work of liquidation within the three-year period
or to reduce disputed claims to judgment. The authorities are
to the effect that suits by or against a corporation abate when
it ceased to be an entity capable of suing or being sued (7
R.C.L., Corps., par. 750); but trustees to whom the corporate
assets have been conveyed pursuant to the authority of Sec.
78 [now Sec. 122] may sue and be sued as such in all matters
connected with the liquidation . . . .

Same; Same; Same; Same;Since the law specifically

allows a trustee to manage the affairs of the corporation in
liquidation, any supervening fact, such as the dissolution of
the corporation, repeal of a law, or any other fact of similar
nature would not serve as an effective bar to the enforcement
of such right.There is, therefore, no reason why the suit filed
by private respondent should not be allowed to proceed to
execution. It is conceded by petitioners that the judgment
against them and in favor of private respondent in C.A. G.R.
No. 16070 had become final and executory. The only reason for
their refusal to execute the same is that there is no existing
corporation to which they are indebted. Such argument is
fallacious. As previously mentioned, the law specifically allows
a trustee to manage the affairs of the corporation in
liquidation. Consequently, any supervening fact, such as the
dissolution of the corporation, repeal of a law, or any other fact
of similar nature would not serve as an effective bar to the
enforcement of such right.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Wenceslao S. Fajardofor petitioners.
Romualdo M. Jubayfor private respondent.
MENDOZA, J.:
In Civil Case No. Q-35598, entitled Pepsi Cola Bottling
Company of the Philippines, Inc. v. Urbano (Ben)
Reburiano and James Reburiano, the Regional Trial Court,
Branch 103 rendered on June 1, 1987 a decision, the
dispositive portion of which reads:
ACCORDINGLY, judgment is hereby rendered in favor of plaintiff
Pepsi Cola Bottling Co. of the Philippines, Inc.

1. 1.Ordering the defendants Urbano (Ben) Reburiano and

James Reburiano to pay jointly and severally the
plaintiff the sum of P55,000.00, less whatever empties
(cases and bottles) may be returned by said
defendants valued at the rate of P55.00 per empty
case with bottles.
2. 2.Costs against the defendants in case of execution.
SO ORDERED.

Private respondent Pepsi Cola Bottling Company of the

Philippines, Inc. appealed to the Court of Appeals seeking
the modification of the portion of the decision, which
stated the value of the cases with empty bottles as
P55.00 per case, and obtained a favorable decision. On
June 26, 1990, judgment was rendered as follows:
WHEREFORE, the decision appealed from is SET ASIDE and
another one is rendered, ordering the defendant-appellees to
pay jointly and severally the plaintiff-appellant the sum of
P55,000.00 with interest at the legal rate from January 1982.
With costs against defendants-appellees.

After the case had been remanded to it and the judgment

had become final and executory, the trial court issued on
February 5, 1991 a writ of execution.
It appears that prior to the promulgation of the
decision of the trial court, private respondent amended
its articles of incorporation to shorten its term of
existence to July 8, 1983. The amended articles of
incorporation was approved by the Securities and
Exchange Commission on March 2, 1984. The trial court
was not notified of this fact.
On February 13, 1991, petitioners moved to quash the
writ of execution alleging

1.3.That when the trial of this case was conducted,

when the decision was rendered by this Honorable
Court, when the said decision was appealed to the
Court of Appeals, and when the Court of Appeals
rendered its decision, the private respondent was
no longer in existence and had no more juridical
personality and so, as such, it no longer had the
capacity to sue and be sued;
2.4.That after the [private respondent], as a
corporation, lost its existence and juridical
personality, Atty. Romualdo M. Jubay had no more
client in this case and so his appearance in this
case was no longer possible and tenable;
3.5.That in view of the foregoing premises, therefore,
the decision rendered by this Honorable Court and
by the Honorable Court of Appeals are patent
nullity, for lack of jurisdiction and lack of capacity
to sue and be sued on the part of the [private
respondent];
4. 6.That the above-stated change in the situation of

parties, whereby the [private respondent] ceased

to exist since 8 July 1983, renders the execution of
the decision inequitable or impossible.
1

Private respondent opposed petitioners motion. It argued

that the jurisdiction of the court as well as the respective
parties capacity to sue had already been established
during the initial stages of the case; and that when the
complaint was filed in 1982, private respondent was still
an existing corporation so that the mere fact that it was
dissolved at the time the case was yet to be resolved did
not warrant the dismissal of the case or oust the trial
court of its jurisdiction. Private respondent further
claimed that its dissolution was effected in order to

transfer its assets to a new firm of almost the same name

and was thus only for convenience.
On February 28, 1991, the trial court issued an
order denying petitioners motion to quash. Petitioners
then filed a notice of appeal, but private respondent
moved to dismiss the appeal on the ground that the trial
courts order of February 28, 1991 denying petitioners
motion to quash writ of execution was not
appealable. The trial court, however, denied private
respondents motion and allowed petitioners to pursue
their appeal.
In its resolution of September 3, 1991, the appellate
court dismissed petitioners appeal. Petitioners moved for
a reconsideration, but their motion was denied by the
appellate court in its resolution, dated November 26,
1991.
Hence, this petition for review on certiorari. Petitioners
pray that the resolutions, dated September 3, 1991 and
November 26, 1991, of the Court of Appeals be set aside
and that a new decision be rendered declaring the order
of the trial court denying the motion to quash to be
appealable and ordering the Court of Appeals to give due
course to the appeal.
On the other hand, private respondent argues that
petitioners knew that it had ceased to exist during the
course of the trial of the case but did not act upon this
information until the judgment was about to be enforced
against them; hence, the filing of a Motion to Quash and
the present petition are mere dilatory tactics resorted to
by petitioners. Private respondent likewise cites the ruling
of this Court inGelano v. Court of Appeals that the
counsel of a dissolved corporation is deemed a trustee of
the same for purposes of continuing such action or
actions as may be pending at the time of the dissolution
to counter petitioners contention that private respondent
2

lost its capacity to sue and be sued long before the trial
court rendered judgment and hence execution of such
judgment could not be complied with as the judgment
creditor has ceased to exist.
First. The question is whether the order of the trial
court denying petitioners Motion to Quash Writ of
Execution is appealable. As a general rule, no appeal lies
from such an order, otherwise litigation will become
interminable. There are exceptions, but this case does not
fall within any of such exceptions.
In Limpin, Jr. v. Intermediate Appellate Court, this Court
held:
8

Certain, it is, . . . that execution of final and executory

judgments may no longer be contested and prevented, and no
appeal should lie therefrom; otherwise, cases would be
interminable, and there would be negation of the
overmastering need to end litigations.
There may, to be sure, be instances when an error may be
committed in the course of execution proceedings prejudicial
to the rights of a party. These instances, rare though they may
be, do call for correction by a superior court, as where
1. 1)the writ of execution varies the judgment;
2. 2)there has been a change in the situation of the parties
making execution inequitable or unjust;
3. 3)execution is sought to be enforced against property
exempt from execution;
4. 4)it appears that the controversy has never been
submitted to the judgment of the court;
5. 5)the terms of the judgment are not clear enough and
there remains room for interpretation thereof; or,

6. 6)it appears that the writ of execution has been

improvidently issued, or that it is defective in
substance, or is issued against the wrong party, or that
the judgment debt has been paid or otherwise
satisfied, or the writ was issued without authority;
In these exceptional circumstances, considerations of justice
and equity dictate that there be some mode available to the
party aggrieved of elevating the question to a higher court.
That mode of elevation may be either by appeal (writ of error
or certiorari) or by a special civil action of certiorari,
prohibition, or mandamus.

In this case, petitioners anchored their Motion to Quash

on the claim that there was a change in the situation of
the parties. However, a perusal of the cases which have
recognized such a ground as an exception to the general
rule shows that the change contemplated by such
exception is one which occurred subsequent to the
judgment of the trial court. Here, the change in the status
of private respondent took place in 1983, when it was
dissolved, during the pendency of its case in the trial
court. The change occurred prior to the rendition of
judgment by the trial court.
It is true that private respondent did not inform the
trial court of the approval of the amended articles of
incorporation which shortened its term of existence.
However, it is incredible that petitioners did not know
about the dissolution of private respondent considering
the time it took the trial court to decide the case and the
fact that petitioner Urbano Reburiano was a former
employee of private respondent. As private respondent
says, since petitioner Reburiano was a former sales
manager of the company, it could be reasonably
presumed that petitioners knew of the changes occurring
in respondent company. Clearly, the present case does
10

not fall under the exception relied upon by petitioners

and, the Court of Appeals correctly denied due course to
the appeal. As has been noted, there are in fact cases
which hold that while parties are given a remedy from a
denial of a motion to quash or recall writ of execution, it
is equally settled that the writ will not be recalled by
reason of any defense which could have been made at
the time of the trial of the case.
Second. The Court of Appeals also held that in any
event petitioners cannot raise the question of capacity of
a dissolved corporation to maintain or defend actions
previously filed by or against it because the matter had
not been raised by petitioners before the trial court nor in
their appeal from the decision of the said court. The
appellate court stated:
11

It appears that said motion to quash writ of execution is

anchored on the ground that plaintiff-appellee Pepsi Bottling
Company of the Philippines had been dissolved as a
corporation in 1983, after the filing of this case before the
lower court, hence, it had lost its capacity to sue. However,
this was never raised as an issue before the lower court and
the Court of Appeals when the same was elevated on appeal.
The decision of this Court, through its Fourth Division, dated
June 26, 1990, in CA-G.R. CV No. 16070 which, in effect,
modified the appealed decision, consequently did not touch on
the issue of lack of capacity to sue, and has since become final
and executory on July 16, 1990, and has been remanded to the
court a quo for execution. It is readily apparent that the same
can no longer be made the basis for this appeal regarding the
denial of the motion to quash writ of execution. It should have
been made in the earlier appeal as the same was already
obtaining at that time.
12

We agree with this ruling. Rules of fair play, justice, and

due process dictate that parties cannot raise for the first
time on appeal from a denial of a Motion to Quash a Writ

of Execution issues which they could have raised but

never did during the trial and even on appeal from the
decision of the trial court.
Third. In any event, if the question of private
respondents capacity to sue can be raised for the first
time in this case, we think petitioners are in error in
contending that a dissolved and non-existing corporation
could no longer be represented by a lawyer and
concomitantly a lawyer could not appear as counsel for a
non-existing judicial person.
Section 122 of the Corporation Code provides in part:
13

14

122. Corporate Liquidation.Every Corporation whose charter

expires by its own limitation or is annulled by forfeiture or
otherwise, or whose corporate existence for other purposes is
terminated in any other manner, shall nevertheless be
continued as a body corporate for three (3) years after the
time when it would have been so dissolved, for the purpose of
prosecuting and defending suits by or against it and enabling it
to settle and close its affairs, to dispose of and convey its
property and to distribute its assets, but not for the purpose of
continuing the business for which it was established.
At any time during said three (3) years, said corporation is
authorized and empowered to convey all of its property to
trustees for the benefit of stockholders, members, creditors,
and other persons in interest. From and after any such
conveyance by the corporation of its property in trust for the
benefit of its stockholders, members, creditors and others in
interests, all interests which the corporation had in the
property terminates, the legal interest vests in the trustees,
and the beneficial interest in the stockholders, members,
creditors or other persons in interest.

Petitioners argue that while private respondent Pepsi Cola

Bottling Company of the Philippines, Inc. undertook a
voluntary dissolution on July 3, 1983 and the process of
liquidation for three (3) years thereafter, there is no

showing that a trustee or receiver was ever appointed.

They contend that 122 of the Corporation Code does not
authorize a corporation, after the three-year liquidation
period, to continue actions instituted by it within said
period of three years. Petitioners cite the case of National
Abaca and Other Fibers Corporation v. Pore wherein this
Court stated:
15

It is generally held, that where a statute continues the

existence of a corporation for a certain period after its
dissolution for the purpose of prosecuting and defending suits,
etc., the corporation becomes defunct upon the expiration of
such period, at least in the absence of a provision to the
contrary, so that no action can afterwards be brought by or
against it, and must be dismissed. Actions pending by or
against the corporation when the period allowed by the statute
expires, ordinarily abate.
16

This ruling, however, has been modified by subsequent

cases. In Board of Liquidators v. Kalaw, this Court stated:
17

. . . The legal interest became vested in the trusteethe Board

of Liquidators.
The beneficial interest remained with the sole stock-holder
the government. At no time had the government withdrawn
the property, or the authority to continue the present suit,
from the Board of Liquidators. If for this reason alone, we
cannot stay the hand of the Board of Liquidators from
prosecuting this case to its final conclusion. The provision of
Section 78 (now Section 122) of the Corporation Lawthe third
method of winding up corporate affairsfinds application.
18

Indeed, in Gelano vs. Court of Appeals, a case having

substantially similar facts as the instant case, this Court
held:
19

However, a corporation that has a pending action and which

cannot be terminated within the three-year period after its
dissolution is authorized under Sec. 78 [now 122] of the

Corporation Law to convey all its property to trustees to enable

it to prosecute and defend suits by or against the corporation
beyond the three-year period. Although private respondent did
not appoint any trustee, yet the counsel who prosecuted and
defended the interest of the corporation in the instant case
and who in fact appeared in behalf of the corporation may be
considered a trustee of the corporation at least with respect to
the matter in litigation only. Said counsel had been handling
the case when the same was pending before the trial court
until it was appealed before the Court of Appeals and finally to
this Court. We therefore hold that there was substantial
compliance with Sec. 78 [now 122] of the Corporation Law
and such private respondent Insular Sawmill, Inc. could still
continue prosecuting the present case even beyond the period
of three (3) years from the time of dissolution.
. . . [T]he trustee may commence a suit which can proceed
to final judgment even beyond the three-year period.No
reason can be conceived why a suit already commenced by
the corporation itself during its existence, not by a mere
trustee who, by fiction, merely continues the legal personality
of the dissolved corporation should not be accorded similar
treatment allowedto proceed to final judgment and
execution thereof.
20

In the Gelano case, the counsel of the dissolved

corporation was considered a trustee. In the later case
ofClemente v. Court of Appeals, we held that the board
of directors may be permitted to complete the corporate
liquidation by continuing as trustees by legal
implication. For, indeed, as early as 1939, in the case
of Sumera v. Valencia, this Court held:
21

22

It is to be noted that the time during which the corporation,

through its own officers, may conduct the liquidation of its
assets and sue and be sued as a corporation is limited to three
years from the time the period of dissolution commences; but
there is no time limit within which the trustees must complete

a liquidation placed in their hands. It is provided only (Corp.

Law, Sec. 78 [now Sec. 122]) that the conveyance to the
trustees must be made within the three-year period. It may be
found impossible to complete the work of liquidation within the
three-year period or to reduce disputed claims to judgment.
The authorities are to the effect that suits by or against a
corporation abate when it ceased to be an entity capable of
suing or being sued (7 R.C.L., Corps., par. 750); but trustees to
whom the corporate assets have been conveyed pursuant to
the authority of Sec. 78 [now Sec. 122] may sue and be sued
as such in all matters connected with the liquidation . . . .
23

Furthermore, the Corporation Law provides:

145. Amendment or repeal.No right or remedy in favor of or
against any corporation, its stockholders, members, directors,
trustees, or officers, nor any liability incurred by any such
corporation, stockholders, members, directors, trustees, or
officers, shall be removed or impaired either by the
subsequent dissolution of said corporation or by any
subsequent amendment or repeal of this Code or of any part
thereof.

This provision safeguards the rights of a corporation

which is dissolved pending litigation.
There is, therefore, no reason why the suit filed by
private respondent should not be allowed to proceed to
execution. It is conceded by petitioners that the judgment
against them and in favor of private respondent in C.A.
G.R. No. 16070 had become final and executory. The only
reason for their refusal to execute the same is that there
is no existing corporation to which they are indebted.
Such argument is fallacious. As previously mentioned, the
law specifically allows a trustee to manage the affairs of
the corporation in liquidation. Consequently, any
supervening fact, such as the dissolution of the
corporation, repeal of a law, or any other fact of similar

nature would not serve as an effective bar to the

enforcement of such right.
WHEREFORE, the resolutions, dated September 3,
1991 and November 26, 1991, of the Court of Appeals are
AFFIRMED.
SO ORDERED.

GENEROSO SALIGUMBA, ERNESTO SALIGUMBA, and

HEIRS OF SPOUSES VALERIA SALIGUMBA AND ELISEO
SALIGUMBA, SR., petitioners, vs.MONICA PALANOG,
respondent.
Actions; Judgments; Revival of Judgments; An action for
revival of judgment is no more than a procedural means of
securing the execution of a previous judgment which has
become dormant after the passage of five years without it
being executed upon motion of the prevailing partyit is not
intended to re-open any issue affecting the merits of the
judgment debtors case nor the propriety or correctness of the
first judgment.An action for revival of judgment is no more
than a procedural means of securing the execution of a
previous judgment which has become dormant after the
passage of five years without it being executed upon motion of
the prevailing party. It is not intended to re-open any issue
affecting the merits of the judgment debtors case nor the
propriety or correctness of the first judgment. An action for
revival of judgment is a new and independent action, different
and distinct from either the recovery of property case or the
reconstitution case, wherein the cause of action is the decision
itself and not the merits of the action upon which the judgment
sought to be enforced is rendered. Revival of judgment is
premisedon the assumption that the decission to be revived,
either by motion or by independent action, is already final and
executory.
Same; Death of a Party; Quieting of Title; An action for
quieting of title with damages, an action involving real
property, is an action that survives pursuant to Section 1, Rule
87 as the claim is not extinguished by the death of a party.
Civil Case No. 2570 is an action for quieting of title with
damages which is an action involving real property. It is an
action that survives pursuant to Section 1, Rule 87 as the claim
is not extinguished by the death of a party. And when a party

dies in an action that survives, Section 17 of Rule 3 of the

Revised Rules of Court provides for the procedure.
Same; Same; Section 17, Rule 3 of the Revised Rules of
Court is explicit that the duty of the court to order the legal
representative or heir to appear arises only upon proper
noticea notation Party-Deceased on the unserved notices
could not be the proper notice contemplated by the rule.
Section 17 is explicit that the duty of the court to order the
legal representative or heir to appear arises only upon proper
notice. The notation Party-Deceased on the unserved
notices could not be the proper notice contemplated by the
rule. As the trial court could not be expected to know or take
judicial notice of the death of a party without the proper
manifestation from counsel, the trial court was well within its
jurisdiction to proceed as it did with the case. Moreover, there
is no showing that the courts proceedings were tainted with
irregularities.
Same; Same; It is the duty of counsel for the deceased to
inform the court of the death of his client; The rules operate on
the presumption that the attorney for the deceased party is in
a better position than the attorney for the adverse party to
know about the death of his client and to inform the court of
the name and address of his legal representative.It is the
duty of counsel for the deceased to inform the court of the
death of his client. The failure of counsel to comply with his
duty under Section 16 to inform the court of the death of his
client and the non-substitution of such party will not invalidate
the proceedings and the judgment thereon if the action
survives the death of such party. The decision rendered shall
bind the partys successor-in-interest. The rules operate on the
presumption that the attorney for the deceased party is in a
better position than the attor- 10ney for the adverse party to
know about the death of his client and to inform the court of
the name and address of his legal representative.

Same; Same; Attorneys; Withdrawal of Counsel; The

counsel of record is obligated to protect his clients interest
until he is released from his professional relationship with his
client; Until his withdrawal shall have been approved, the
lawyer remains counsel of record who is expected by his client
as well as by the court to do what the interests of his client
requirethe attorney-client relation does not terminate
formally until there is a withdrawal of record.This
notwithstanding, when Valeria Saligumba died on 2 February
1985, Atty. Miralles again did not inform the trial court of the
death of Valeria Saligumba. There was no formal substitution
nor submission of proof of death of Valeria Saligumba. Atty.
Miralles was remiss in his duty under Section 16, Rule 3 of the
Revised Rules of Court. The counsel of record is obligated to
protect his clients interest until he is released from his
professional relationship with his client. For its part, the court
could recognize no other representation on behalf of the client
except such counsel of record until a formal substitution of
attorney is effected. An attorney must make an application to
the court to withdraw as counsel, for the relation does not
terminate formally until there is a withdrawal of record; at
least, so far as the opposite party is concerned, the relation
otherwise continues until the end of the litigation. Unless
properly relieved, the counsel is responsible for the conduct of
the case. Until his withdrawal shall have been approved, the
lawyer remains counsel of record who is expected by his client
as well as by the court to do what the interests of his client
require. He must still appear on the date of hearing for the
attorney-client relation does not terminate formally until there
is a withdrawal of record.

PETITION for review on certiorari of the decision of the

Regional Trial Court of Kalibo, Aklan, Br. 5.
The facts are stated in the opinion of the Court.
Public Attorneys Officefor petitioners.
Porferio T. Taplac for respondent.

11CARPIO,J.:

The Case
This is a petition for review of the Decision dated 24
May 2000 of the Regional Trial Court, Branch 5, Kalibo,
Aklan (RTC-Branch 5) in Civil Case No. 5288 for Revival of
Judgment. The case is an offshoot of the action for
Quieting of Title with Damages in Civil Case No. 2570.
The Facts
Monica Palanog, assisted by her husband Avelino
Palanog (spouses Palanogs), filed a complaint dated 28
February 1977 for Quieting of Title with Damages against
defendants, spouses Valeria Saligumba and Eliseo
Saligumba, Sr. (spouses Saligumbas), before the Regional
Trial Court, Branch 3, Kalibo, Aklan (RTC-Branch 3). The
case was docketed as Civil Case No. 2570. In the
complaint, spouses Palanogs alleged that they have been
in actual, open, adverse and continuous possession as
owners for more than 50 years of a parcel of land located
in Solido, Nabas, Aklan. The spouses Saligumbas
allegedly prevented them from entering and residing on
the subject premises and had destroyed the barbed wires
enclosing the land. Spouses Palanogs prayed that they be
declared the true and rightful owners of the land in
question.
When the case was called for pre-trial on 22 September
1977, Atty. Edilberto Miralles (Atty. Miralles), counsel for
spouses Saligumbas, verbally moved for the appointment
of a commissioner to delimit the land in question. Rizalino
Go, Deputy Sheriff of Aklan, was appointed commissioner
and was directed to submit his report and sketch within
30 days.1 Present during the delimitation were spouses
Palanogs, spouses Saligumbas, and Ernesto Saligumba,
son of spouses Saligumbas.2

After submission of the Commissioners Report,

spouses Palanogs, upon motion, were granted 10 days to
amend their complaint to conform with the items
mentioned in the report.3
Thereafter, trial on the merits ensued. At the hearing
on 1 June 1984, only the counsel for spouses Palanogs
appeared. The trial court issued an order resetting the
hearing to 15 August 1984 and likewise directed spouses
Saligumbas to secure the services of another counsel who
should be ready on that date.4 The order sent to Eliseo
Saligumba, Sr. was returned to the court unserved with
the notation Party-Deceased while the order sent to
defendant Valeria Saligumba was returned with the
notation Party in Manila.5
At the hearing on 15 August 1984, spouses Palanogs
direct examination was suspended and the continuation
of the hearing was set on 25 October 1984. The trial court
stated that Atty. Miralles, who had not withdrawn as
counsel for spouses Saligumbas despite his appointment
as Municipal Circuit Trial Court judge, would be held
responsible for the case of spouses Saligumbas until he
formally withdrew as counsel. The trial court reminded
Atty. Miralles to secure the consent of spouses
Saligumbas for his withdrawal.6 A copy of this order was
sent to Valeria Saligumba but the same was returned
unserved with the notation Party in Manila.7
The hearing set on 25 October 1984 was reset to 25
January 1985 and the trial court directed that a copy of
this order be sent to Eliseo Saligumba, Jr. at COA, PNB,
Manila.8
The presentation of evidence for spouses Palanogs
resumed on 25 January 1985 despite the motion of Atty.
Miralles for postponement on the ground that his client
was sick. The exhibits were admitted and plaintiffs
spouses Palanogs rested their case. Reception of

evidence for the defendants spouses Saligumbas was

scheduled on 3, 4, and 5 June 1985.9
On 3 June 1985, only spouses Palanogs and counsel
appeared. Upon motion of the spouses Palanogs, spouses
Saligumbas were deemed to have waived the
presentation of their evidence.
On 3 August 1987, after a lapse of more than two
years, the trial court considered the case submitted for
decision.
On 7 August 1987, RTC-Branch 3 rendered a judgment
in Civil Case No. 2570 declaring spouses Palanogs the
lawful owners of the subject land and ordering spouses
Saligumbas, their agents, representatives and all persons
acting in privity with them to vacate the premises and
restore possession to spouses Palanogs.
The trial court, in a separate Order dated 7 August
1987, directed that a copy of the courts decision be
furnished plaintiff Monica Palanog and defendant Valeria
Saligumba.
Thereafter, a motion for the issuance of a writ of
execution of the said decision was filed but the trial court,
in its Order dated 8 May 1997, ruled that since more than
five years had elapsed after the date of its finality, the
decision could no longer be executed by mere motion.
Thus, on 9 May 1997, Monica Palanog (respondent), now
a widow, filed a Complaint seeking to revive and enforce
the Decision dated 7 August 1987 in Civil Case No. 2570
which she claimed has not been barred by the statute of
limitations.
She
impleaded
petitioners
Generoso
Saligumba and Ernesto Saligumba, the heirs and children
of the spouses Saligumbas, as defendants. The case was
docketed as Civil Case No. 5288 before the RTC-Branch 5.
Petitioner Generoso Saligumba, for himself and in
representation of his brother Ernesto who was out of the

country working as a seaman, engaged the services of

the Public Attorneys Office, Kalibo, Aklan which filed a
motion for time to allow them to file a responsive
pleading. Petitioner Generoso Saligumba filed his
Answer10alleging that: (1) respondent had no cause of
action; (2) the spouses Saligumbas died while Civil Case
No. 2570 was pending and no order of substitution was
issued and hence, the trial was null and void; and (3) the
court did not acquire jurisdiction over the heirs of the
spouses Saligumbas and therefore, the judgment was not
binding on them.
Meanwhile, on 19 December 1997, the trial court
granted respondents motion to implead additional
defendants namely, Eliseo Saligumba, Jr. and Eduardo
Saligumba, who are also the heirs and children of spouses
Saligumbas.11 They were, however, declared in default on
1 October 1999 for failure to file any responsive
pleading.12
The Trial Courts Ruling
On 24 May 2000, the RTC-Branch 5 rendered a decision in
favor of respondent ordering the revival of judgment in
Civil Case No. 2570. The trial court ruled that the nonsubstitution of the deceased spouses did not have any
legal significance. The land subject of Civil Case No. 2570
was the exclusive property of defendant Valeria
Saligumba who inherited the same from her deceased
parents. The death of her husband, Eliseo Saligumba, Sr.,
did not change the complexion of the ownership of the
property that would require his substitution. The spouses
Saligumbas children, who are the petitioners in this case,
had no right to the property while Valeria Saligumba was
still alive. The trial court further found that when
defendant Valeria Saligumba died, her lawyer, Atty.
Miralles, did not inform the court of the death of his

client. The trial court thus ruled that the non-substitution

of the deceased defendant was solely due to the
negligence of counsel. Moreover, petitioner Ernesto
Saligumba could not feign ignorance of Civil Case No.
2570 as he was present during the delimitation of the
subject land. The trial court likewise held that the
decision in Civil Case No. 2570 could not be the subject of
a collateral attack. There must be a direct action for the
annulment of the said decision.
Petitioners elevated the matter directly to this Court.
Hence, the present petition.
The Courts Ruling
The instant case is an action for revival of judgment
and the judgment sought to be revived in this case is the
decision in the action for quieting of title with damages in
Civil Case No. 2570. This is not one for annulment of
judgment.
An action for revival of judgment is no more than a
procedural means of securing the execution of a previous
judgment which has become dormant after the passage
of five years without it being executed upon motion of the
prevailing party. It is not intended to re-open any issue
affecting the merits of the judgment debtors case nor the
propriety or correctness of the first judgment. 13 An action
for revival of judgment is a new and independent action,
different and distinct from either the recovery of property
case or the reconstitution case, wherein the cause of
action is the decision itself and not the merits of the
action upon which the judgment sought to be enforced is
rendered.14Revival of judgment is premised on the
assumption that the decision to be revived, either by
motion or by independent action, is already final and
executory.15

The RTC-Branch 3 Decision dated 7 August 1987 in Civil

Case No. 2570 had been rendered final and executory by
the lapse of time with no motion for reconsideration nor
appeal having been filed. While it may be true that the
judgment in Civil Case No. 2570 may be revived and its
execution may be had, the issue now before us is whether
or not execution of judgment can be issued against
petitioners who claim that they are not bound by the RTCBranch 3 Decision dated 7 August 1987 in Civil Case No.
2570.
Petitioners contend that the RTC-Branch 3 Decision of 7
August 1987 in Civil Case No. 2570 is null and void since
there was no proper substitution of the deceased spouses
Saligumbas despite the trial courts knowledge that the
deceased
spouses
Saligumbas
were
no
longer
represented by counsel. They argue that they were
deprived of due process and justice was not duly served
on them.
Petitioners argue that the trial court even acknowledged
the fact of death of spouses Saligumbas but justified the
validity of the decision rendered in that case despite lack
of substitution because of the negligence or fault of their
counsel. Petitioners contend that the duty of counsel for
the deceased spouses Saligumbas to inform the court of
the death of his clients and to furnish the name and
address of the executor, administrator, heir or legal
representative of the decedent under Rule 3 presupposes
adequate or active representation by counsel. However,
the relation of attorney and client was already terminated
by the appointment of counsel on record, Atty. Miralles, as
Municipal Circuit Trial Court judge even before the deaths
of the spouses Saligumbas were known. Petitioners
invoke the Order of 1 June 1984 directing the spouses
Saligumbas to secure the services of another lawyer to
replace Atty. Miralles. The registered mail containing that

order was returned to the trial court with the notation

that Eliseo Saligumba, Sr. was deceased. Petitioners
thus question the decision in Civil Case No. 2570 as being
void and of no legal effect because their parents were not
duly represented by counsel of record. Petitioners further
argue that they have never taken part in the proceedings
in Civil Case No. 2570 nor did they voluntarily appear or
participate in the case. It is unfair to bind them in a
decision rendered against their deceased parents.
Therefore, being a void judgment, it has no legal nor
binding effect on petitioners.
Civil Case No. 2570 is an action for quieting of title with
damages which is an action involving real property. It is
an action that survives pursuant to Section 1, Rule 87 16 as
the claim is not extinguished by the death of a party. And
when a party dies in an action that survives, Section 17 of
Rule 3 of the Revised Rules of Court 17 provides for the
procedure, thus:
16 Section 1, Rule 87 of theRevised Rules of Court provides:
SECTION1.Actions which may and which may not be brought
against executor or administrator.No action upon a claim for the
recovery of money or debt or interest thereon shall be commenced
against the executor or administrator; but actions to recover real
or personal property, or an interest therein, from the estate, or to
enforce a lien thereon, and actions to recover damages for an
injury to person or property, real or personal, may be commenced
against him.
17 Spouses Eliseo Saligumba, Sr. and Valeria Saligumba died before
the effectivity of the 1997 Rules on Civil Procedure. Section 17, Rule 3 of
the Rules of Court was amended and is now Section 16, Rule 3 of the
1997 Rules on Civil Procedure which reads:
Section16.Death of a party; duty of counsel.Whenever a
party to a pending action dies, and the claim is not thereby
extinguished, it shall be the duty of his counsel to in-

18

Section17.Death of Party.After a party dies and the

claim is not thereby extinguished, the court shall order, upon
proper notice, the legal representative of the deceased to
appear and to be substituted for the deceased, within a period
of thirty (30) days, or within such time as may be granted. If
the legal representative fails to appear within said time, the
court may order the opposing party to procure the
appointment of a legal representative of the deceased within a
time to be specified by the court, and the representative shall
immediately appear for and on behalf of the interest of the
deceased. The court charges involved in procuring such
appointment, if defrayed by the opposing party, may be
recovered as costs. The heirs of the deceased may be allowed
to be substituted for the deceased, without requiring the
appointment of an executor or administrator and the court
may appoint guardian ad litemfor the minor heirs. (Emphasis
and italics supplied)

Under the express terms of Section 17, in case of death

of a party, and upon proper notice, it is the duty of the
court to order the legal representative or heir of the
deceased to appear for the deceased. In the instant case,
it is true that the trial court, after receiving
aninformal notice of death by the mere notation in the
envelopes, failed to order the appearance of the legal
representative or heir of the deceased. There was no
court order for deceaseds legal representative or heir to
appear, nor did any such legal representative ever appear
in court to be substituted for the deceased. Neither did
the respondent ever procure the appointment of such
legal representative, nor did the heirs ever ask to be
substituted.
It appears that Eliseo Saligumba, Sr. died on 18
February 1984 while Valeria Saligumba died on 2
February 1985. No motion for the substitution of the

spouses was filed nor an order issued for the substitution

of the deceased spouses Saligumbas in Civil Case No.
2570. Atty. Miralles and petitioner Eliseo Saligumba, Jr.,
despite notices sent to them to appear, never confirmed
the death of Eliseo Saligumba, Sr. and Valeria Saligumba.
The record is bereft of any evidence proving the death of
the spouses, except the mere notations in the envelopes
enclosing the trial courts orders which were returned
unserved.
Section 17 is explicit that the duty of the court to order
the legal representative or heir to appear arises only
upon proper notice. The notation Party-Deceased on
the unserved notices could not be the proper notice
contemplated by the rule. As the trial court could not be
expected to know or take judicial notice of the death of a
party without the proper manifestation from counsel, the
trial court was well within its jurisdiction to proceed as it
did with the case. Moreover, there is no showing that the
courts proceedings were tainted with irregularities.18
Likewise, the plaintiff or his attorney or representative
could not be expected to know of the death of the
defendant if the attorney for the deceased defendant did
not notify the plaintiff or his attorney of such death as
required by the rules.19 The judge cannot be blamed for
sending copies of the orders and notices to defendants
spouses in the absence of proof of death or manifestation
to that effect from counsel.20
Section 16, Rule 3 of the Revised Rules of Court
likewise expressly provides:
SEC.16.Duty of attorney upon death, incapacity or
incompetency of party.Whenever a party to a pending case
dies, becomes incapacitated or incompetent, it shall be the
duty of his attorney to inform the court promptly of such death,
incapacity or incompetency, and to give the name and

residence of his executor, administrator, guardian or other

legal representative.

It is the duty of counsel for the deceased to inform the

court of the death of his client. The failure of counsel to
comply with his duty under Section 16 to inform the court
of the death of his client and the non-substitution of such
party will not invalidate the proceedings and the
judgment thereon if the action survives the death of such
party. The decision rendered shall bind the partys
successor-in-interest.21
The rules operate on the presumption that the attorney
for the deceased party is in a better position than the
attorney for the adverse party to know about the death of
his client and to inform the court of the name and
address of his legal representative.22
Atty. Miralles continued to represent the deceased
spouses even after the latters demise. Acting on their
behalf, Atty. Miralles even asked for postponement of the
hearings and did not even confirm the death of his clients
nor his appointment as Municipal Circuit Trial Court judge.
These clearly negate petitioners contention that Atty.
Miralles ceased to be spouses Saligumbas counsel.
Atty. Miralles still remained the counsel of the spouses
Saligumbas despite the alleged appointment as judge.
Records show that when Civil Case No. 2570 was called
for trial on 25 October 1984, Atty. Miralles appeared and
moved for a postponement. The 25 October 1984 Order
reads:
ORDER
Upon petition of Judge Miralles who is still the counsel on
record of this case and who is held responsible for anything
that will happen in this case, postpone the hearing of this case
to JANUARY 25, 1985 AT 8:30 in the morning. x x x
23

The trial court issued an Order dated 1 June 1984

directing the defendants to secure the services of another
counsel. This order was sent to Eliseo Saligumba, Sr. by
registered mail but the same was returned with the
notation Party-Deceased while the notice to Valeria
Saligumba was returned with the notation Party in
Manila.24Eliseo Saligumba, Sr. died on 18 February 1984.
When Atty. Miralles appeared in court on 25 October
1984, he did not affirm nor inform the court of the death
of his client. There was no formal substitution. The trial
court issued an order resetting the hearing to 25 January
1985 and directed that a copy of the order be furnished
petitioner Eliseo Saligumba, Jr. at COA, PNB, Manila by
registered mail.25 When the case was called on 25 January
1985, Atty. Miralles sought for another postponement on
the ground that his client was sick and under medical
treatment in Manila.26 Again, there was no manifestation
from counsel about the death of Eliseo Saligumba, Sr. The
trial court issued an Order dated 25 January 1985 setting
the reception of evidence for the defendants on 3, 4, and
5 June 1985. A copy of this order was sent to Eliseo
Saligumba, Jr. by registered mail. Nonetheless, as the trial
court in Civil Case No. 5288 declared, the nonsubstitution of Eliseo Saligumba, Sr. did not have any
legal significance as the land subject of Civil Case No.
2570 was the exclusive property of Valeria Saligumba
who inherited it from her deceased parents.
This notwithstanding, when Valeria Saligumba died on
2 February 1985, Atty. Miralles again did not inform the
trial court of the death of Valeria Saligumba. There was
no formal substitution nor submission of proof of death of
Valeria Saligumba. Atty. Miralles was remiss in his duty
under Section 16, Rule 3 of the Revised Rules of Court.
The counsel of record is obligated to protect his clients
interest until he is released from his professional

relationship with his client. For its part, the court could
recognize no other representation on behalf of the client
except such counsel of record until a formal substitution
of attorney is effected.27
An attorney must make an application to the court to
withdraw as counsel, for the relation does not terminate
formally until there is a withdrawal of record; at least, so
far as the opposite party is concerned, the relation
otherwise continues until the end of the litigation. 28 Unless
properly relieved, the counsel is responsible for the
conduct of the case.29 Until his withdrawal shall have been
approved, the lawyer remains counsel of record who is
expected by his client as well as by the court to do what
the interests of his client require. He must still appear on
the date of hearing for the attorney-client relation does
not terminate formally until there is a withdrawal of
record.30
Petitioners should have questioned immediately the
validity of the proceedings absent any formal
substitution. Yet, despite the courts alleged lack of
jurisdiction over the persons of petitioners, petitioners
never bothered to challenge the same, and in fact
allowed the proceedings to go on until the trial court
rendered its decision. There was no motion for
reconsideration, appeal or even an action to annul the
judgment in Civil Case No. 2570. Petitioners themselves
could not feign ignorance of the case since during the
pendency of Civil Case No. 2570, petitioner Ernesto
Saligumba, son of the deceased spouses, was among the
persons present during the delimitation of the land in
question before the Commissioner held on 5 November
1977.31 Petitioner Eliseo Saligumba, Jr. was likewise
furnished a copy of the trial courts orders and notices. It
was only the Answer filed by petitioner Generoso
Saligumba in Civil Case No. 5288 that confirmed the

dates when the spouses Saligumbas died and named the

latters children. Consequently, Atty. Miralles was
responsible for the conduct of the case since he had not
been properly relieved as counsel of record. His acts bind
his clients and the latters successors-in-interest.
In the present case for revival of judgment, the other
petitioners have not shown much interest in the case.
Petitioners Eliseo Saligumba, Jr. and Eduardo Saligumba
were declared in default for failure to file their answer.
Petitioner Ernesto Saligumba was out of the country
working as a seaman. Only petitioner Generoso
Saligumba filed an Answer to the complaint. The petition
filed in this Court was signed only by petitioner Generoso
Saligumba as someone signed on behalf of petitioner
Ernesto Saligumba without the latters authority to do so.
WHEREFORE, we DENY the petition. We AFFIRM the
Decision dated 24 May 2000 of the Regional Trial Court,
Branch 5, Kalibo, Aklan in Civil Case No. 5288. Costs
against petitioners.
SO ORDERED.
Puno
(C.J.,
Chairperson),
Corona andAzcuna,
JJ., concur.
Tinga, J.,** In the result.
Petition denied, judgment affirmed.
Notes.The doctrine ofres judicata has no application
where the latter action is for revival of a prior judgment.
(Caia vs. Court of Appeals, 239 SCRA 252 [1994])
The allegations in the complaint for revival of judgment
determine whether it is a real action or a personal action.
Where the sole reason for action to revive is the
enforcement of adjudged rights over a piece of property,
the action falls under the category of a real action, for
which the complaint should be filed with the Regional Trial

Court of the place where the realty is located. (Infante vs.

Aran Builders, Inc., 531 SCRA 123 [2007])

PHILIPPINE
NATIONAL
BANK,
plaintiffappellant,vs. JOAQUINBONDOC, defendant-appellee.
Judgments; Revival of revived
judgment may itself be revived.

judgment.A

revived

Same; Nature of revived judgment is a new judgment.A

judgment rendered on a complaint for the revival of a previous
judgment is a new judgment, and the rights of the plaintiff rest
on the new judgment, not on the previous one.
Same; Prescription; Period of limitation to bring action to
enforce revived judgment is ten years.An action to enforce a
revived judgment prescribes in ten years from the date the
revived judgment became final, not from the date the original
judgment became final.

APPEAL from an order of the Court of First Instance of

Manila. Leuterio, J.
The facts are stated in the opinion of the Court.
Tomas
Besa andAntonio
P. Ruiz for
plaintiffappellant.
Eriberto D. Ignacio for defendant-appellee.
BENGZON, J.P., J.:
On June 29, 1949 the Philippine National Bank obtained a
judgment in Civil Case No. 8040 from the Court of First
Instance of Manila against Joaquin M. Bondoc for P10,
289.60 plus interest at the rate of 7% per annum
computed from June 30, 1949 and attorneys fees. This
judgment was never executed.
After five years and upon the instance of the Philippine
National Bank said judgment was revived in Civil Case No.
30663 on February 20, 1957 where the Court of First
Instance of Manila condemned Joaquin M. Bondoc to pay
the Philippine National Bank the sum of P16,841.64 plus

7% interest and costs. Neither was this judgment

enforced during the five years thereafter.
But on June 7, 1962 the Philippine National Bank
instituted in the Court of First Instance of Manila Civil
Case No. 50601 for the enforcement of the judgment
rendered in Civil Case No. 30663. On motion of
defendant, however, the complaint for revival of
judgment was dismissed on grounds of prescription and
lack of cause of action.
The lower court held that the right to revive the
judgment has prescribed inasmuch as more than ten
years had elapsed since it was first rendered on June 29,
1949. It further ruled that the Code of Civil Procedure (Act
190) or the New Civil Code does not provide for the
revival of a revived judgment.
Plaintiff has appealed from the order of dismissal. The
only issue is whether or not a revived judgment may itself
be revived.
Section 6 of Rule 39 states:
SEC. 6. Execution by motion or by independent action.A
judgment may be executed on motion within five (5) years
from the date of its entry or from the date it becomes final and
executory. After the lapse of such time, and before it is barred
by the statute of limitations, a judgment may be enforced by
action.

Section 6, abovequoted, makes no distinction as to the

kind of judgment which may be revived by ordinary
independent action. Such being so, appellees proposition
that a revived judgment cannot any more be enforced by
action under said section has no justification. When the
law does not distinguish, neither should we.
A judgment rendered on a complaint for the revival of
a previous judgment is a new judgment, and the rights of
the plaintiff rest on the new judgment, not on the

previous one. Precisely, the purpose of the revival of a

judgment is to give a creditor a new right of enforcement
from the date of revival. The rule seeks to protect
judgment creditors from wily and unscrupulous debtors
who, in order to evade attachment or execution,
cunningly conceal their assets and wait until the statute
of limitations sets in.
Section 6 aforementioned requires that the judgment
sought to be revived is not barred by prescription. Under
Article 1144(3) of the New Civil Code the right to enforce
a judgment prescribes in ten years counted from the date
said judgment becomes final.
A judgment is revived only when the same cannot be
enforced by motion, that is, after five years from the time
it becomes final. A revived judgment can be enforced by
motion within five years from its finality. After said five
years, how may the revived judgment be enforced?
Appellee contends that by that time ten years or more
would have elapsed since the first judgment becomes
final, so that an action to enforce said judgment would
then be barred by the statute of limitations.
Appellees theory relates the period of prescription to
the date the original judgment became final. Such a
stand is inconsistent with the accepted view that a
judgment reviving a previous one is a new and different
judgment. The inconsistency becomes clearer when we
consider that the causes of action in the three cases are
different. In the original case, the action was premised on
the unpaid promissory note signed by Joaquin Bondoc in
favor of the Philippine National Bank; in the second case,
the Philippine National Banks cause of action was the
judgment rendered in Civil Case No. 8040; and in the
present case, the basis is the judgment rendered in Civil
Case No. 30663. Parenthetically, even the amounts
involved are different.
1

The source of Section 6 aforecited is Section 447 of the

Code of Civil Procedure which in turn was derived from
the Code of Civil Procedure of California. The rule followed
in California in this regard is that a proceeding by
separate ordinary action to revive a judgment is a new
action rather than a continuation of the old, and results in
a new judgment constituting a new cause of action, upon
which a new period of limitations begins to run.
The judgment in Civil Case No. 30663, which provided
the cause of action in the case at bar, was rendered on
February 20, 1957 and became final in the same year.
Pursuant to Article 1144(3) of the New Civil Code the
action upon such judgment must be brought within ten
years from 1957 or until 1967. The instant case instituted
in the court a quoon June 7, 1962 is well within the
prescriptive period.
WHEREFORE, the order appealed from is hereby set
aside and this case remanded to the lower court for
further proceedings. Costs against appellee. It is so
ordered.
Bengzon, C.J.,Bautista Angelo, Concepcion,Reyes,
J.B.L., Regala,Makalintal and Zaldivar, JJ., concur,
Barrera, J., is on leave.
Paredes and Dizon, JJ., took no part.
Order set aside and case remanded to lower court for
further proceedings.
Notes.After the lapse of the five-year period from
the date of entry of judgment or from the date the
judgment becomes final and executory, the judgment is
reduced to a mere right of action, which judgment must
be enforced, as all other ordinary actions, by the
institution of a complaint in the regular form. Ranillo, Jr. v.
Pershing Tan Queto, 23 SCRA 1363, 1366 citing Azotes v.
3

Blanco,85 Phil. 90; Torrefranca v. Albiso, 102 Phil. 732;

andPrimo v. Fernandez, 5 SCRA 463.
As to when or from what date the five-year period
should be counted, seeRanillo, Jr. v. Pershing Tan
Queto, supra.

ADELAIDA INFANTE, petitioner, vs. ARAN BUILDERS, INC.,

respondent.
**

Actions; Venue; Judgments;Revival

of
Judgment; The
proper venue in an action for revival of judgment depends on
the determination of whether the present action for revival of
judgment is a real action or a personal action.The proper
venue depends on the determination of whether the present
action for revival of judgment is a real action or a personal
action. Applying the afore-quoted rules on venue, if the action
for revival of judgment affects title to or possession of real
property, or interest therein, then it is a real action that must
be filed with the court of the place where the real property is
located. If such action does not fall under the category of real
actions, it is then a personal action that may be filed with the
court of the place where the plaintiff or defendant resides.
Same; Same; Same; Same;Pleadings and Practice; The
allegations in the complaint for revival of judgment determine
whether it is a real action or a personal action; Where the sole
reason for action to revive is the enforcement of adjudged
rights over a piece of property, the action falls under the
category of a real action for which the complaint should be
filed with the Regional Trial Court of the place where the realty
is located.The allegations in the complaint for revival of
judgment determine whether it is a real action or a personal
action. The complaint for revival of judgment alleges that a
final and executory judgment has ordered herein petitioner to
execute a deed of sale over a parcel of land in Ayala Alabang
Subdivision in favor of herein private respondent; pay all
pertinent taxes in connection with said sale; register the deed
of sale with the Registry of Deeds and deliver to Ayala
Corporation the certificate of title issued in the name of private
respondent. The same judgment ordered private respondent to
pay petitioner the sum of P321,918.25 upon petitioners
compliance with the aforementioned order. It is further alleged

that petitioner refused to comply with her judgment

obligations despite private respondents repeated requests and
demands, and that the latter was compelled to file the action
for revival of judgment. Private respondent then prayed that
the judgment be revived and a writ of execution be issued to
enforce said judgment. The previous judgment has
conclusively declared private respondents right to have the
title over the disputed property conveyed to it. It is, therefore,
undeniable that private respondent has an established interest
over the lot in question; and to protect such right or interest,
private respondent brought suit to revive the previous
judgment. The sole reason for the present action to revive is
the enforcement of private respondents adjudged rights over
a piece of realty. Verily, the action falls under the category of a
real action, for it affects private respondents interest over real
property. The present case for revival of judgment being a real
action, the complaint should indeed be filed with the Regional
Trial Court of the place where the realty is located.
Courts; A branch of the Regional Trial Court shall exercise
its authority only over a particular territory defined by the
Supreme Court.It is quite clear that a branch of the Regional
Trial Court shall exercise its authority only over a particular
territory defined by the Supreme Court. Originally, Muntinlupa
City was under the territorial jurisdiction of the Makati Courts.
However, Section 4 of Republic Act No. 7154, entitled An Act to
Amend Section Fourteen of Batas Pambansa Bilang 129,
Otherwise Known As The Judiciary Reorganization Act of 1981,
took effect on September 4, 1991. Said law provided for the
creation of a branch of the Regional Trial Court in Muntinlupa.
Thus, it is now the Regional Trial Court in Muntinlupa City which
has territorial jurisdiction or authority to validly issue orders
and processes concerning real property within Muntinlupa City.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.

De Belen and Nagui for petitioner.

Gancayco, Balasbas and Associates Law Offices for
private respondent.
AUSTRIA-MARTINEZ, J.:
This resolves the Petition for Review on Certiorari under
Rule 45 of the Rules of Court, seeking the reversal of the
Decision of the Court of Appeals (CA) promulgated on
August 12, 2002, which upheld the Order dated
September 4, 2001, issued by the Regional Trial Court of
Muntinlupa City (RTC).
The undisputed facts and issues raised in the lower
courts are accurately summarized by the CA as follows:
1

Before the Regional Trial Court of Muntinlupa City (or

Muntinlupa RTC; Branch 276), presided over by Hon. Norma
C. Perello (or respondent judge), was an action for revival of
judgment filed on June 6, 2001 by Aran Builders, Inc. (or
private
respondent)
against
Adelaida
Infante
(or
petitioner), docketed as Civil Case No. 01-164.
The judgment sought to be revived was rendered by the
Regional Trial Court of Makati City (or Makati RTC; Branch 60)
in an action for specific performance and damages, docketed
as Civil Case No. 15563.
The Makati RTC judgment, which became final
executory on November 16, 1994, decreed as follows:

and

26.WHEREFORE, the Court hereby renders judgment as

follows:
26.1The defendant ADELAIDA B. INFANTE is ordered to do
the following within thirty (30) days from finality hereof:
26.1.1.To deliver to the plaintiff ARAN BUILDERS, INC. the
following: (a) the complete plans (lot plan, location map
and vicinity map); (b) Irrevocable Power of Attorney; (c)

Real Estate Tax clearance; (d) tax receipts; (e) proof of up

to date payment of Subdivision Association dues referred
to in the CONTRACT TO SELL dated November 10, 1986
(Exh. A or Exh. 1);
26.1.2.To execute the deed of sale of Lot No. 11, Block 9,
Phase 3-A1, Ayala Alabang Subdivision covered by TCT No.
114015 for P500,000.00 in favor of the plaintiff;
26.1.3.To pay the capital gains tax, documentary stamp
taxes and other taxes which the Bureau of Internal
Revenue may assess in connection with the sale
mentioned in the preceding paragraph and to submit to
the plaintiff proof of such payment;
26.1.4.To secure the written conformity of AYALA
CORPORATION to the said sale and to give such written
conformity to the plaintiff;
26.1.5.To register the deed of sale with the Registry of
Deeds and deliver to AYALA CORPORATION the certificate
of title issued in the name of plaintiff pursuant to such
registration;
26.2Upon the compliance of the defendant with the
preceding directives, the plaintiff must immediately pay to
the defendant the sum of P321,918.25;
26.3The defendant is ordered to pay plaintiff P10,000.00
as attorneys fees;
26.4The Complaint for moral and exemplary damages is
DISMISSED;
26.5The COUNTERCLAIM is DISMISSED; and

26.6Cost is taxed against the defendant.

Petitioner filed a motion to dismiss the action (for revival of
judgment) on the grounds that the Muntinlupa RTC has no
jurisdiction over the persons of the parties and that venue was
improperly laid. Private respondent opposed the motion.
On September 4, 2001, the Muntinlupa RTC issued an order
which reads:
The MOTION TO DISMISS is denied.
Admittedly, the Decision was rendered by the Makati Regional
Trial Court, but it must be emphasized that at that time there was still
no Regional Trial Court in Muntinlupa City, then under the territorial
jurisdiction of the Makati Courts, so that cases from this City were
tried and heard at Makati City. With the creation of the Regional Trial
Courts of Muntinlupa City, matters involving properties located in this
City, and cases involving Muntinlupa City residents were all ordered
to be litigated before these Courts.

which declared private respondent as the owner of a parcel of

land located in Muntinlupa City and (that) the judgment
rendered by the (Makati RTC) in Civil Case No. 15563 sought to
be enforced necessarily involves the interest, possession, title
and ownership of the parcel of land located in Muntinlupa City.
Petitioner asserts that the complaint for specific
performance and damages before the Makati RTC is a personal
action and, therefore, the suit to revive the judgment therein is
also personal in nature; and that, consequently, the venue of
the action for revival of judgment is either Makati City or
Paraaque City where private respondent and petitioner
respectively reside, at the election of private respondent.
On the other hand, private respondent maintains that the
subject action for revival judgment is quasi in rembecause it
involves and affects vested or adjudged right on a real
property; and that, consequently, venue lies in Muntinlupa
City where the property is situated.
2

The case at bar is a revival of a judgment which declared the

plaintiff as the owner of a parcel of land located in Muntinlupa City. It
is this judgment which is sought to be enforced thru this action which
necessarily involves the interest, possession, title, and ownership of
the parcel of land located in Muntinlupa city and adjudged to Plaintiff.
It goes without saying that the complaint should be filed in the latter
City where the property is located, as there are now Regional Trial
Courts hereat.
Defendant may answer the complaint within the remaining period,
but no less than five (5) days, otherwise a default judgment might be
taken against her.
It is SO ORDERED.

Her motion for reconsideration having been denied per

order dated September 28, 2001, petitioner came to this Court
[CA] via the instant special civil action for certiorari. She
ascribes grave abuse of discretion amounting to lack or excess
of jurisdiction on the part of respondent judge for erroneously
holding that Civil Case No. 01-164 is a revival of judgment

On August 12, 2002, the CA promulgated its Decision

ruling in favor of herein private respondent. The CA held
that since the judgment sought to be revived was
rendered in an action involving title to or possession of
real property, or interest therein, the action for revival of
judgment is then an actionin rem which should be filed
with the Regional Trial Court of the place where the real
property is located. Petitioner moved for reconsideration
of the CA Decision but the motion was denied per
Resolution dated January 7, 2003.
Hence, herein petition. Petitioner claims that the CA
erred in finding that the complaint for revival of judgment
is an action in remwhich was correctly filed with the RTC
of the place where the disputed real property is located.
The petition is unmeritorious.
Petitioner insists that the action for revival of judgment
is an action in personam; therefore, the complaint should

be filed with the RTC of the place where either petitioner

or private respondent resides. Petitioner then concludes
that the filing of the action for revival of judgment with
the RTC of Muntinlupa City, the place where the disputed
property is located, should be dismissed on the ground of
improper venue.
Private respondent is of the opinion that the judgment
it is seeking to revive involves interest over real property.
As such, the present action for revival is a real action, and
venue was properly laid with the court of the place where
the realty is located.
Thus, the question that must be answered is: where is
the proper venue of the present action for revival of
judgment?
Section 6, Rule 39 of the 1997 Rules of Civil Procedure
provides that after the lapse of five (5) years from entry
of judgment and before it is barred by the statute of
limitations, a final and executory judgment or order may
be enforced by action. The Rule does not specify in which
court the action for revival of judgment should be filed.
In Aldeguer v. Gemelo, the Court held that:
3

x x x an action upon a judgment must be brought either in the

same court where said judgment was rendered or in the place
where the plaintiff or defendant resides, or in any other
place designated by the statutes which treat of the
venue of actions in general. (Emphasis supplied)
4

but emphasized that other provisions in the rules of

procedure which fix the venue of actions in general must
be considered.
Under the present Rules of Court, Sections 1 and 2 of
Rule 4 provide:
5

Section 1. Venue of real actions.Actions affecting title to or

possession of real property, or interest therein, shall be
commenced and tried in the proper court which has jurisdiction

over the area wherein the real property involved, or a portion

thereof, is situated.
xxxx
Section 2. Venue of personal actions.All other actions may
be commenced and tried where the plaintiff or any of the
principal plaintiffs resides, or where the defendant or any of
the principal defendants resides, or in the case of a nonresident defendant where he may be found, at the election of
the plaintiff.

Thus, the proper venue depends on the determination of

whether the present action for revival of judgment is a
real action or a personal action. Applying the aforequoted rules on venue, if the action for revival of
judgment affects title to or possession of real property, or
interest therein, then it is a real action that must be filed
with the court of the place where the real property is
located. If such action does not fall under the category of
real actions, it is then a personal action that may be filed
with the court of the place where the plaintiff or
defendant resides.
In support of her contention that the action for revival
of judgment is a personal action and should be filed in the
court of the place where either the plaintiff or defendant
resides, petitioner cites the statements made by the
Court in Aldeguer v. Gemelo and Donnelly v. Court of First
Instance
of
Manila. Petitioner,
however,
seriously
misunderstood the Courts rulings in said cases.
In Aldeguer, what the Court stated was that [t]he
action for the execution of ajudgment for damages is a
personal one, and under section 377 [of the Code of Civil
Procedure], it should be brought in any province where
the plaintiff or the defendant resides, at the election of
the plaintiff (Emphasis and italics supplied). Petitioner
apparently took such statement to mean that any action
for revival of judgment should be considered as a
6

personal one. This thinking is incorrect. The Court

specified that the judgment sought to be revived in said
case was a judgment for damages. The judgment
subject of the action for revival did not involve or affect
any title to or possession of real property or any interest
therein. The complaint filed in the revival case did not fall
under the category of real actions and, thus, the action
necessarily fell under the category of personal actions.
In Donnelly, the portion of the Decision being relied
upon by petitioner stated thus:
Petitioner raises before this Court two (2) issues, namely: (a)
whether an action for revival of judgment is one quasi in
remand, therefore, service of summons may be effected thru
publication; and (b) whether the second action for revival of
judgment (Civil Case No. 76166) has already prescribed.To our
mind, the first is not a proper and justiciable issue in
the present proceedings x x x. Nevertheless, let it be said
that an action to revive a judgment is a personal one.
(Emphasis supplied)
9

The Court clearly pointed out that in said case, the issue
on whether an action for revival of judgment isquasi in
rem was not yet proper and justiciable. Therefore, the
foregoing statement cannot be used as a
precedent, as it was merely an obiter dictum.Moreover,
as in Aldeguer, the judgment sought to be revived
in Donnelly involved judgment for a certain sum of
money. Again, no title or interest in real property was
involved. It is then understandable that the action for
revival in said case was categorized as a personal one.
Clearly,
the
Courts
classification
in Aldeguerand Donnelly of the actions for revival of
judgment as being personal in character does not apply
to the present case.
The allegations in the complaint for revival of judgment
determine whether it is a real action or a personal action.

The complaint for revival of judgment alleges that a

final and executory judgment has ordered herein
petitioner to execute a deed of sale over a parcel of land
in Ayala Alabang Subdivision in favor of herein private
respondent; pay all pertinent taxes in connection with
said sale; register the deed of sale with the Registry of
Deeds and deliver to Ayala Corporation the certificate of
title issued in the name of private respondent. The same
judgment ordered private respondent to pay petitioner
the sum of P321,918.25 upon petitioners compliance
with the aforementioned order. It is further alleged that
petitioner refused to comply with her judgment
obligations despite private respondents repeated
requests and demands, and that the latter was compelled
to file the action for revival of judgment. Private
respondent then prayed that the judgment be revived
and a writ of execution be issued to enforce said
judgment.
The previous judgment has conclusively declared
private respondents right to have the title over the
disputed property conveyed to it. It is, therefore,
undeniable that private respondent has an established
interest over the lot in question; and to protect such right
or interest, private respondent brought suit to revive the
previous judgment. The sole reason for the present action
to revive is the enforcement of private respondents
adjudged rights over a piece of realty. Verily, the action
falls under the category of a real action, for it affects
private respondents interest over real property.
The present case for revival of judgment being a real
action, the complaint should indeed be filed with the
Regional Trial Court of the place where the realty is
located.
Section 18 of Batas Pambansa Bilang 129 provides:

Sec. 18. Authority to define territory appurtenant to each

branch.The Supreme Court shall define the territory
over which a branch of the Regional Trial Court shall
exercise its authority. The territory thus defined shall
be deemed to be the territorial area of the branch
concerned for purposes of determining the venue of all
suits, proceedings or actions, whether civil or criminal, as
well as determining the Metropolitan Trial Courts, Municipal
Trial Courts and Municipal Circuit Trial Courts over which the
said branch may exercise appellate jurisdiction. The power
herein granted shall be exercised with a view to making the
courts readily accessible to the people of the different parts of
the region and making the attendance of litigants and
witnesses as inexpensive as possible. (Emphasis supplied)

From the foregoing, it is quite clear that a branch of the

Regional Trial Court shall exercise its authority
only over a particular territory defined by the
Supreme Court. Originally, Muntinlupa City was under
the territorial jurisdiction of the Makati Courts. However,
Section 4 of Republic Act No. 7154, entitled An Act to
Amend Section Fourteen ofBatas Pambansa Bilang 129,
Otherwise Known As The Judiciary Reorganization Act of
1981, took effect on September 4, 1991. Said law
provided for the creation of a branch of the Regional Trial
Court in Muntinlupa. Thus, it is now the Regional Trial
Court in Muntinlupa City which has territorial jurisdiction
or authority to validly issue orders and processes
concerning real property within Muntinlupa City.
Thus, there was no grave abuse of discretion
committed by the Regional Trial Court of Muntinlupa City,
Branch 276 when it denied petitioners motion to dismiss;
and the CA did not commit any error in affirming the
same.

WHEREFORE, the petition is DENIED. The Decision

dated August 12, 2002 and Resolution dated January 7,
2003 of the Court of Appeals are AFFIRMED.
SO ORDERED.
Ynares-Santiago(Chairperson), Chico-Nazario, Nac
hura and Reyes, JJ., concur.
Petition denied, judgment and resolution affirmed.
Notes.The doctrine ofres judicata has no application
where the latter action is for revival of a prior judgment.
(Caia vs. Court of Appeals, 239 SCRA 252[1994])
An action for revival of judgment is no more than a
procedural means of securing the execution of a previous
judgment which has become dormant after the passage
of five years without it being executed upon motion of the
prevailing
party.
(Panotes
vs.
City
Townhouse
Development Corporation, 512 SCRA 269[2007])

AURORA B. CAMACHO, petitioner, vs. COURT OF APPEALS,

LEONCIA DIZON, RICARDO VALERA, DELFIN MANLAPID,
JACOBE QUINTOS and SPOUSES GASPAR and ELENA
QUINTOS, respondents.
Remedial Law; Executions;A judgment may be executed
on motion within five (5) years from the date of its entry or
from the date it becomes final and executory.Pursuant to
Sec. 6, Rule 39, of the Rules of Court a judgment may be
executed on motion within five (5) years from the date of its
entry or from the date it becomes final and executory. After the
lapse of such time, and before it is barred by the statute of
limitations, a judgment may be enforced by action.
Same; Same; Where the delays were occasioned by
petitioners own initiatives and for her advantage as well as
beyond respondents control, Court holds that the five-year
period allowed for enforcement of the judgment by motion was
deemed to have been effectively interrupted or suspended.
Under the peculiar circumstances of the present case where
the delays were occasioned by petitioners own initiatives and
for her advantage as well as beyond respondents control, we
hold that the five-year period allowed for enforcement of the
judgment by motion was deemed to have been effectively
interrupted or suspended. Once again we rely upon basic
notions of equity and justice in so ruling.
Same; Same; The purpose of the law in prescribing time
limitations for enforcing judgments or actions is to prevent
obligors from sleeping on their rights.The purpose of the law
in prescribing time limitations for enforcing judgments or
actions is to prevent obligors from sleeping on their rights. Far
from sleeping on their rights, respondents persistently pursued
their rights of action. It is revolting to the conscience to allow
petitioner to further avert the satisfaction of her obligation
because of sheer literal adherence to technicality. After all, the
Rules of Court mandates that a liberal construction of the Rules

be adopted in order to promote their object and to assist the

parties
in
obtaining
just,
speedy
and
inexpensive
determination of every action and proceeding. This rule of
construction is especially useful in the present case where
adherence to the letter of the law would result in absurdity and
manifest injustice.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Rodolfo B. Melliza for petitioner.
Teodoro O. Camacho III for private respondents.
BELLOSILLO, J.:
The issue here is not new; it is simply, whether a
judgment may still be executed by mere motion after the
lapse of five (5) years from its finality.
Before the then Court of First Instance (now Regional
Trial Court) of Balanga, Bataan, respondents Leoncia
Dizon, Ricardo Valera, Delfin Manlapid, Jacobe Quintos
and spouses Gaspar and Elena Quintos instituted an
action for specific performance against petitioner Aurora
B. Camacho concerning certain portions of Lot No. 26108
covered by TCT No. T29799. Their claim was anchored on
the respective deeds of sale in their favor.
On 20 December 1974 the trial court ruled for
respondents. Petitioner was ordered, among other things,
to segregate the definite portions sold to respondents and
to deliver to them their corresponding titles. On 30
January 1981 respondent Court of Appeals affirmed the
judgment with modification. On 4 June 1982 the appellate
court
granted
reconsideration
by
deleting
the
modification. On 21 March 1983 this Court denied the
petition for review on certiorari which denial became final
1

and executory on 23 May 1983. On 6 June 1983 the

records were remanded to the Balanga trial court.
On respondents motion, the writ of execution was issued
on 26 August 1983. On 28 September 1983 petitioner
moved to defer the execution on the ground that the
directive of the judgment could not be carried out in the
absence of an approved subdivision plan. Besides, the
boundaries and exact locations of the subject lots could
not be determined. On 18 January 1984 the trial court
denied the motion and ordered the Provincial Sheriff to
enforce the writ. Thereafter petitioner filed a notice of
appeal while respondents moved for its dismissal. On 22
March 1985 the trial court ruled that its order was not
appealable and directed the issuance of a new writ of
execution. Undaunted, petitioner resorted anew to
respondent court by way of a petition forcertiorari,
prohibition andmandamus which was however denied. On
26 February 1986 the petition before us met the same
fate.
On 26 September 1986 a new writ of execution was
issued. Nonetheless the judgment remained unenforced
due to the alleged failure of petitioner to surrender her
copy of the title. Upon inquiry with the Register of Deeds
of Bataan, respondents discovered that titles to the
subject lots were transferred in 1984 to petitioners
daughter Aurora Fe B. Camacho. Thus on 14 April 1987
respondents moved that petitioner and/or her daughter
surrender the copies of the present titles to the trial
court.
On 11 August 1987 the trial court granted the motion
insofar as it was directed against petitioner but not as
against
her
daughter.
Petitioner
moved
for
reconsideration on 4 September 1987 while respondents
moved for modification which petitioner opposed.
Subsequently, another incident concerning the authority

of a new counsel for respondents to replace their original

counsel was submitted. The trial court considered the
new counsel as co-counsel but the ruling was assailed by
petitioner. Consequently on 25 September 1990 it
ordered respondents counsel to comment thereon
without resolving the previous motions of the parties.
In a letter dated 24 January 1992 respondents invited
the attention of this Court to the vacancy in the branch of
the trial court where their case was pending. On 15 June
1992 they moved again for implementation of the writ of
execution. On 10 September 1992 petitioner countered
by moving to dismiss the proceedings on the contention
that the trial court had no more jurisdiction because more
than five (5) years had elapsed from the date of entry of
judgment.
The trial court sustained petitioner and explained that
although respondents motion was for implementation of
the writ of execution, in effect they were seeking the
issuance of an alias writ which should have been done
within the period 26 February 1986 and 25 February 1991
and therefore their motion was denied. In the order of 19
November
1992, the
trial
court
dismissed
the
proceedings and in view thereof found it necessary to
dwell on the other pending motions.
Respondent appellate court assessed the situation
differently. According to it
2

x x x x The period during which defendants motion to defer

execution (dated September 28, 1983), which was finally
resolved only upon the promulgation of the Supreme Courts
resolution dated February 26, 1986 (about 2 1/2 years) should
be considered as having stayed or suspended the five-year
period. It is noted that the Court of Appeals categorically ruled
that defendants motion to defer execution is a purely dilatory
action to stave off the execution of a long final judgment of the
trial court, and rejected defendants contention that the

portions of Lot No. 261-B which she sold to the plaintiffs are
unidentifiable x x x x

issue inGonzales
emphasized

x x x x The five-year period should be deemed extended by

the delay due to causes not of plaintiffs making, as that due to
a vacancy in the sala. We also see no reason why the period of
the pendency of plaintiffs Motion to Surrender Owners
Duplicate Copy of Title as well as the other unresolved
incidents spawned by defendants determined efforts to resist
execution of a final judgment should not be considered as
having tolled the five-year period when no fault can be
attributed to plaintiffs for the courts failure to resolve these
pending incidents. Reasons of equity which have been
justifiably invoked in the computation of the five-year
prescriptive period for execution on motion argue against a
contrary ruling.

On several instances, this Court has invoked the principle of

equity in computing the 5-year period to execute a judgment
by motion. We have ruled that if the delays were through no
fault of the prevailing party, the same should not be included
in computing the 5-year period to execute a judgment by
motion x x x x

Thus on 15 December 1994 respondent court set aside

the order of the trial court and remanded the case for
further proceedings.
Petitioner asserts that her motion to defer execution as
well as the petitions before the appellate courts could not
have possibly suspended the five-year reglementary
period inasmuch as no writ of injunction was issued. She
adds that it is immaterial that there was a vacancy in the
sala of the Presiding Judge and that there were
unresolved motions since the problem lies in the failure of
respondents to apply for an alias writ of execution within
the reglementary period.
We find no reversible error committed by respondent
court. Pursuant to Sec. 6, Rule 39, of the Rules of Court a
judgment may be executed on motion within five (5)
years from the date of its entry or from the date it
becomes final and executory. After the lapse of such time,
and before it is barred by the statute of limitations, a
judgment may be enforced by action. Resolving the same
4

v.

Court

of

Appeals the
6

Court

Along the same line, the Court elucidated in Republic v.

Court of Appeals
7

To be sure, there had been many instances where this Court

allowed execution by motion even after the lapse of five years,
upon meritorious grounds. These exceptions have one
common denominator, and that is: the delay is caused or
occasioned by actions of the judgment debtor and/or is
incurred for his benefit or advantage.
8

In the case under consideration, the judgment sought to

be executed became final and executory on 23 May 1983.
The writ of execution was issued on 25 July 1983 but on
28 September 1983 petitioner moved to defer execution.
She even elevated the matter to respondent court and
this Court until it was settled unfavorably on 26 February
1986. By then petitioner has consumed almost two and a
half (2 1/2) years or almost half of the period allotted to
respondents within which to move to execute the
judgment. On 26 September 1986 a new writ of execution
was issued but unfortunately did not serve its purpose
due to the alleged failure of petitioner to surrender her
copy of the title. Then it turned out according to
respondents that the original title was cancelled and two
(2) new titles were issued in the name of petitioners
daughter, Aurora Fe. Respondents were prompted to file
on 14 April 1987 a motion requiring petitioner and/or her
daughter to surrender their copies of the new titles. This
motion was granted on 11 August 1987 but only against

petitioner. The latter moved for reconsideration on 4

September
1987
while
respondents
moved
for
modification which petitioner opposed. Another incident
regarding the representation of respondents by new
counsel arose. As of 25 September 1990 when the trial
court issued its order regarding the representation the
foregoing motions remained unresolved.
Furthermore, a vacancy in the trial court was created
when the then Presiding Judge retired on 14 November
1990. Another Judge assumed office on 22 October 1991
but retired barely two (2) months thereafter. A second
vacancy thus existed until the present Presiding Judge
was appointed on 9 March 1992. On 15 June 1992
respondents filed a motion to implement the writ of
execution. Going back to the date when respondents
moved to require petitioner and/or her daughter to
surrender their copies of the new titles almost five (5)
years and two (2) months had passed. Under the peculiar
circumstances of the present case where the delays were
occasioned by petitioners own initiatives and for her
advantage as well as beyond respondents control, we
hold that the five-year period allowed for enforcement of
the judgment by motion was deemed to have been
effectively interrupted or suspended. Once again we rely
upon basic notions of equity and justice in so ruling.
The purpose of the law in prescribing time limitations
for enforcing judgments or actions is to prevent obligors
from sleeping on their rights. Far from sleeping on their
rights, respondents persistently pursued their rights of
action. It is revolting to the conscience to allow petitioner
to further avert the satisfaction of her obligation because
of sheer literal adherence to technicality. After all, the
Rules of Court mandates that a liberal construction of the
Rules be adopted in order to promote their object and to
assist the parties in obtaining just, speedy and

inexpensive determination of every action and

proceeding. This rule of construction is especially useful in
the present case where adherence to the letter of the law
would result in absurdity and manifest injustice.
WHEREFORE, the petition is DENIED. The questioned
decision of respondent Court of Appeals dated 15
December 1994 which ordered that the case be
remanded to the Regional Trial Court for further
proceedings is AFFIRMED. Costs against petitioner.
SO ORDERED.
9

10

ARTURO MACAPAGAL, petitioner, vs. HON. IRENEO LEE

GAKO, JR., in his capacity as Presiding Judge of the
Regional Trial Court of Cebu City, Branch 6, ESTEBAN YAU
and Deputy Sheriff RUBEN S. NEQUINTO, respondents.
Remedial Law; Judgments;Execution; There are instances
where the Court allowed execution by motion even after the
lapse of five years upon meritorious grounds; In computing the
time limit for enforcing a final judgment, the general rule is
that there should not be included the time when execution is
stayed, either by agreement of the parties for a definite time,
by injunction, by the taking of an appeal or writ of error so as
to operate as a supersedeas, by the death of a party or
otherwise; Any interruption or delay occasioned by the debtor
will extend the time within which the writ may be issued
without scire facias.It is clear from the above Rule that a
judgment may be executed on motion within five years from
the date of its entry or from the date it becomes final and
executory. Thereafter, before barred by the statute of
limitations, by action. However, there are instances where this
Court allowed execution by motion even after the lapse of five
years upon meritorious grounds. In Francisco Motors
Corporation v. Court of Appeals, 505 SCRA 8 (2006), this Court
held that in computing the time limit for enforcing a final
judgment, the general rule is that there should not be included
the time when execution is stayed, either by agreement of the
parties for a definite time, by injunction, by the taking of an
appeal or writ of error so as to operate as a supersedeas, by
the death of a party or otherwise. Any interruption or delay
occasioned by the debtor will extend the time within which the
writ may be issued without scire facias.Thus, the time during
which execution is stayed should be excluded, and the said
time will be extended by any delay occasioned by the debtor.
Same; Same; Same;Principle of Immutability of Final
Judgment; Except for correction of clerical errors or the making
of nunc pro tunc entries which causes no prejudice to any

party, or where the judgment is void, the judgment can neither

be amended nor altered after it has become final and
executory.Let it be stressed that with respect to Macapagal
and Silverio the Decision of the trial court has attained finality.
Such definitive judgment is no longer subject to change,
revision, amendment or reversal. Upon finality of the
judgment, the court loses its jurisdiction to amend, modify or
alter the same. Except for correction of clerical errors or the
making ofnunc pro tunc entries which causes no prejudice to
any party, or where the judgment is void, the judgment can
neither be amended nor altered after it has become final and
executory. This is the principle of immutability of final
judgment.
Same; Same; Same; For just as a losing party has the right
to file an appeal within the prescribed period, the winning
party also has the correlative right to enjoy the finality of the
resolution of his case by the execution and satisfaction of the
judgment which is the life of the law.Every litigation must
come to an end once a judgment becomes final, executory and
unappealable. For just as a losing party has the right to file an
appeal within the prescribed period, the winning party also has
the correlative right to enjoy the finality of the resolution of his
case by the execution and satisfaction of the judgment, which
is the life of the law. Any attempt to thwart this rigid rule and
deny the prevailing litigant his right to savour the fruit of his
victory must immediately be struck down. The statute of
limitations has not been devised against those who wish to act
but cannot do so, for causes beyond their control.

PETITIONS for review on certiorari of the decision and

resolutions of the Court of Appeals.
The facts are stated in the opinion of the Court.
Romulo, Mabanta, Buenaventura, Sayoc and De Los
Angeles Law Offices for Esteban Yau.
Rodriguez, Berenguer & Guno for Arturo Macapagal.

Chuidian Law Officefor Ricardo Silverio, Sr.

SANDOVAL-GUTIERREZ,J.:
Before this Court are two (2) consolidated petitions, the
first, docketed as G.R. No. 158848, is a petition for
review on certiorari of the Decision dated September 22,
1999 and Resolution dated June 20, 2003 of the Court of
Appeals in CA-G.R. SP No. 72202; and the other,G.R. No.
171994,
is
likewise
a
petition
for
review
oncertiorari assailing the Decision dated August 24, 2005
and Resolution dated March 15, 2006 of the Court of
Appeals in CA-G.R. SP No. 60106.
The undisputed facts are:
On January 22, 1981, Esteban Yau bought from the
Philippine Underwriters Finance Corporation (Philfinance)
Promissory Note No. 3447 issued by the Philippine Shares
Corporation (PSC). Yau paid the amount of P1,600,000 to
Philfinance for the note. The latter promised to return to
him on March 24, 1981 his investment plus earnings of
P29,866.67. Philfinance then issued postdated checks to
Yau drawn against the Insular Bank of Asia and America,
all maturing on March 24, 1981, for P1,600,000.00,
P24,177.78 and P5,688.89. But when the checks were
deposited in the bank, they were dishonored for
insufficiency of funds. When Yau complained to the PSC, it
denied having issued the promissory note.
Thus, on March 28, 1984, Yau filed a complaint with
the Regional Trial Court (RTC), Branch 6, Cebu City, for
recovery of the value of the promissory note and for
damages against Philfinance and the members of its
board of directors, among whom were Ricardo C. Silverio,
Sr., Pablo C. Carlos, Jr., Arturo Macapagal, Florencio
Biagan, Jr., and Miguel Angel Cano.
Except for defendant Pablo C. Carlos Jr., all the other
defendants failed to file their answers seasonably. Hence,
1

the trial court issued an Order declaring them in default

and allowing Yau to present his evidence ex parte. Pablo
Carlos, Jr., although present during the hearing, did not
present evidence in his defense.
Meanwhile, after the trial court denied their motion for
reconsideration, Silverio and his co-defendants (except
Pablo Carlos, Jr.), filed with the Court of Appeals a petition
for certiorari and prohibition (docketed as CA-G.R. SP No.
04835), assailing the Order of default. The appellate
court, however, in its Decision dated March 10, 1986,
dismissed the petition, holding that summonses were
duly served and that defendants failure to answer the
complaint justifies the trial courts Order declaring them
in default. Since they did not interpose an appeal, the
Decision of the appellate court became final and
executory on June 17, 1986. An entry of judgment was
made on July 4, 1986.
On March 27, 1991, the trial court rendered its
Decision in favor of Esteban Yau. The dispositive portion
reads:
WHEREFORE, judgment is rendered in favor of plaintiff and
against
defendants
Philippine
Underwriters
Finance
Corporation, Ricardo C. Silverio, Sr., Pablo C. Carlos, Jr., Arturo
Macapagal, Florencio Biagan, Jr. and Miguel Angel Cano,
ordering the latter, jointly and severally, to pay the former the
following:

(a)The principal amount of One Million Six Hundred

Thousand (P1,600,000) Pesos, representing the principal
amount of the plaintiffs investment;
(b)The amount of Ten Million Three Hundred Ninety Seven
Thousand Four Hundred Ninety Four Pesos and 03/100
(P10,397,494.03), representing the earnings which the
plaintiff could have made on his investment as of

December 31, 1989 and thereafter, legal interest on the

principal amount of P1,600,000, until fully paid;
(c)The amount of One Hundred Thousand (P100,000)
Pesos as, and for moral damages;
(d)The amount of Fifty Thousand (P50,000) Pesos as, and
for exemplary or corrective damages;
(e)The amount of One Hundred Thirty Seven Thousand
Two Hundred Seven Pesos and 28/100 (P137,207.28) as
attorneys fees; Forty Four Thousand Eighteen Pesos and
33/100 (P44,018.33) as litigation expenses; and
(f)The costs of the suit.
The Counterclaims interposed by the defendant Pablo C.
Carlos, Jr. in his Answer, are dismissed.
SO ORDERED.

Pablo Carlos, Jr. and Philfinance interposed an appeal to

the Court of Appeals, docketed therein asCA-G.R. CV No.
33496. With respect to Silverio, Macapagal, Biagan, and
Cano, their Notice of Appeal was dismissed for their
failure to pay the docket fees. The Order of dismissal
became final and executory on December 26, 1991 and
an entry of judgment was made on April 21, 1992.
On July 31, 1992, the trial court, upon petitioner Yaus
motion, issued an Order directing the execution of its
Decision and, on September 17, 1992, issued the
corresponding writ of execution.
In December 1992, the defendants bank deposits were
garnished by the sheriff. Also, the shares of Silverio in the
Manila Golf and Country Club were sold at public auction
for P2,000,000. As the judgment was only partially
satisfied, the writ of execution was enforced against the
other defendants, including Macapagal.

Silverio and Macapagal took separate courses of

action. On February 2, 1993, Macapagal filed with this
Court a petition for certiorari and prohibition, questioning
the validity of the Decision of the trial court, its Order of
execution and the writ of execution. The petition,
however, was referred to the Court of Appeals, where it
was docketed as CA-G.R. SP No. 31075 and raffled off to
the Fourteenth Division. Eventually, the appellate court
dismissed the petition on the ground that the same was
barred, under the principle of res judicata, by its previous
Decision in CA-G.R. SP No. 04835, upholding the validity
of the trial courts Order of default.
On other hand, Silverio filed with the Court of Appeals
(Special Eleventh Division) a petition for reinstatement of
his appeal and annulment of the writ of execution,
docketed as CA-G.R. CV No. 33496. However, the
appellate court denied the petition on the ground that the
Order of the RTC dismissing the Notice of Appeal had
become final and executory.
Macapagal then filed with this Court a petition for
review on certiorari, docketed as G.R. No. 110610.
Silverio likewise filed with this Court a similar petition,
docketed as G.R. No. 113851. These petitions were
consolidated because they arose out of the same facts. In
its Decision dated April 18, 1997, this Court upheld the
rulings of the Court of Appeals and dismissed their
petitions. Their motions for reconsideration were denied
with finality by this Court in its Resolution dated October
8, 1998.
Considering that the judgment was not fully satisfied,
the sheriff resumed the implementation of the writ. In
1999, he sent notices of garnishment to several banks in
Manila against any existing account of Macapagal.
Thereupon, Macapagal filed with the trial court a motion
to quash the writ of execution on the ground that its
6

lifetime has expired, contending that the judgment in

Civil Case No. CEB- 2058 became final and executory in
1992, hence, can be enforced only within five (5) years
therefrom or until 1997. After five (5) years and within ten
(10) years from the entry of judgment, it may be enforced
only by an independent civil action.
On January 28, 2000, the trial court issued an Order
denying Macapagals motion to quash the writ of
execution. His motion for reconsideration was likewise
denied in a Resolution dated May 22, 2000. The trial court
held that there was an effective interruption or delay in
the implementation of the writ of execution because he
filed with the Court of Appeals and this Court various
petitions.
Macapagal then filed with the Court of Appeals
(Eighteenth Division) a petition for certiorari, docketed
as CA-G.R. SP No. 60106. However, the appellate court, in
its Decision dated August 24, 2005, dismissed the
petition and denied the motion for reconsideration in its
Resolution dated September 15, 2005.
Hence, Macapagal filed with this Court the present
petition, docketed as G.R. No. 171994.
Meanwhile, on October 31, 2000, the Court of Appeals
rendered a Decision in CA-G.R. CV No. 33496 (appeal of
defendants Philfinance and Pablo Carlos, Jr.). The
dispositive portion reads:
IN VIEW OF ALL THE FOREGOING, the appealed decision as
hereby modified in such a way that the award of lost income is
deleted and the legal interest to be paid on the principal
amount of P1,600,000 be computed from the filing of the
complaint at twelve (12%) percent until full payment thereof.
On all other respect, the judgment stands. Costs against
appellants.
7

The aforesaid Decision became final and executory on

March 21, 2001.
Sometime in 2001, the sheriff found that Silverio was a
coowner of three (3) houses located in Forbes Park and
Bel-Air Village, Makati City, covered by TCT Nos.
(147129)-137156,
(436750)-137155
and
(337033)137154 of the Registry of Deeds, same city. Thus, on
March 21, 2001, the sheriff served a Notice of Levy on a
house and lot in Forbes Park. An auction sale was held on
July 26, 2001 wherein Yau was declared the highest
bidder, with a bid of P11,443,219.64 for the said house
and lot covered by TCT No. (436750)-137155. On August
6, 2001, the sheriff issued the corresponding Certificate
of Sale.
On December 7, 2001, Silverio filed with the trial court
an omnibus motion praying that the levy on execution,
the notice of auction sale and the certificate of sale be
declared void. He contends that the writ of execution has
becomefunctus oficio since more than five (5) years have
elapsed from the finality of the judgment sought to be
executed.
The trial court, in its Order of March 20, 2002, denied
the omnibus motion. The trial court also denied his
motion for reconsideration in an Order dated June 21,
2002.
Undaunted, Silverio filed with the Court of Appeals
(Twelfth Division) a petition for certiorari, docketed
asCAG.R. SP No. 72202, challenging the said Orders of
the trial court. On April 15, 2003, the appellate court
rendered its Decision granting the petition, thus:
WHEREFORE, premises considered, the petition is GRANTED,
and the assailed Orders of public respondent judge are
REVERSED and SET ASIDE. The levy by respondent sheriff upon
TCT No. (-147129)-137156, TCT No. (-436750)137155, and TCT
No. (-337033-)137154, as well as the subsequent auction sale

and transfer of the property covered by TCT No. (436750)

137155, are declared NULL and VOID. All annotations upon the
titles to aforesaid properties pursuant to the levy are ordered
cancelled. Costs against private respondent.
SO ORDERED.

Yaus motion for reconsideration was denied by the

appellate court in its Resolution dated June 20, 2003.
Hence, Yau filed the instant petition for review
oncertiorari, docketed as G.R. No. 158848.
In view of the identity of the parties and the issues
inG.R. No. 158848 and G.R. No. 171994, we resolved to
consolidate the two petitions.
The principal and common issue in both petitions is
whether the Decision rendered by the RTC in Civil Case
No. CEB-2058 may no longer be enforced against Silverio
and Macapagal since more than five (5) years have
already lapsed from its finality.
Significantly, the Court of Appeals rendered conflicting
Decisions. In the petition forcertiorari (CA-G.R. SP No.
60106) filed by Macapagal assailing the trial courts
Orders denying his motion to quash the writ of execution,
the appellate court denied his petition. It sustained the
trial courts ruling that its judgment may still be enforced
despite the lapse of five years from the date it became
final; and held that the delay in the implementation of the
writ of execution was due to Macapagals filing with the
Court of Appeals and this Court various petitions.
Relative to Silverios petition for certiorari (CA-G.R. SP
No. 72202) questioning the trial courts Orders denying
his omnibusmotion to declare void the levy on execution,
the auction sale and the certificate of sale, the Court of
Appeals granted his petition. The appellate court ruled
that the writ had become functus oficio and could no

longer be enforced since more than five years have

elapsed from the finality of the trial courts judgment.
Section 6, Rule 39 of the 1997 Rules of Civil Procedure,
as amended provides:
Section 6. Execution by motion or by independent action.A
final and executory judgment or order may be executed on
motion within five (5) years from the date of its entry. After the
lapse of such time, and before it is barred by the statute of
limitations, a judgment may be enforced by action. The revived
judgment may also be enforced by motion within five (5) years
from the date of its entry and thereafter by action before it is
barred by the statute of limitations.

It is clear from the above Rule that a judgment may be

executed on motion within five years from the date of its
entry or from the date it becomes final and executory.
Thereafter, before barred by the statute of limitations, by
action. However, there are instances where this Court
allowed execution by motion even after the lapse of five
years upon meritorious grounds.
In Francisco
Motors
Corporation
v.
Court
of
Appeals, this Court held that in computing the time limit
for enforcing a final judgment, the general rule is that
there should not be included the time when execution is
stayed, either by agreement of the parties for a definite
time, by injunction, by the taking of an appeal or writ of
error so as to operate as a supersedeas, by the death of a
party or otherwise. Any interruption or delay occasioned
by the debtor will extend the time within which the writ
may be issued without scire facias. Thus, the time during
which execution is stayed should be excluded, and the
said time will be extended by any delay occasioned by
the debtor.
There had been many instances where this Court
allowed the execution by motion even after the lapse of
five years. These exceptions have one common
9

denominator, and that is, the delay is caused or

occasioned by actions of the judgment debtor and/or is
incurred for his benefit or advantage.
Here, the judgment of the trial court sought to be
executed became final and executory on December 26,
1991. The writ of execution was issued on September 17,
1992. It could not be enforced for the full satisfaction of
the judgment within the five-year period because
Macapagal and Silverio filed with the Court of Appeals
and this Court petitions challenging the trial courts
judgment and the writ of execution. Such petitions
suspended or interrupted the further enforcement of the
writ.
As stated earlier, on April 18, 1997, this Court rendered
its
Decision
in G.R.
No.
110610 and G.R.
No.
113851 dismissing the petitions of Macapagal and
Silverio assailing the trial courts judgment in Civil Case
No. CEB-2058. In 1998, this Court denied with finality
their motions for reconsideration. And in the instant
petitions, Macapagal and Silverio are attacking the
validity of the writ of execution by the trial court. Because
of their maneuvers, there has been a delay of sixteen
(16) years in the enforcement of such judgment,
reckoned from its finality on December 26, 1991 up to the
present. Indeed, the enforcement of the trial courts
judgment by motion has been interrupted by the acts of
Macapagal and Silverio the judgment debtors.
Every litigation must come to an end. While a litigants
right to initiate an action in court is fully respected,
however, once his case has been adjudicated by a
competent court in a valid final judgment, he should not
be permitted to initiate similar suits hoping to secure a
favorable ruling, for this will result to endless litigations
detrimental to the administration of justice.
10

11

Let it be stressed that with respect to Macapagal and

Silverio the Decision of the trial court has attained finality.
Such definitive judgment is no longer subject to change,
revision, amendment or reversal. Upon finality of the
judgment, the court loses its jurisdiction to amend,
modify or alter the same. Except for correction of clerical
errors or the making of nunc pro tuncentries which
causes no prejudice to any party, or where the judgment
is void, the judgment can neither be amended nor altered
after it has become final and executory. This is the
principle of immutability of final judgment.
In Lim v. Jabalde, this Court further explained the
necessity of adhering to the doctrine of immutability of
final judgments, thus:
12

Litigation must end and terminate sometime and somewhere

and it is essential to an effective and efficient administration of
justice that, once a judgment has become final, the winning
party be, not through a mere subterfuge, deprived of the fruits
of the verdict. Courts must therefore guard against any
scheme calculated to bring about that result. Constituted as
they are to put an end to controversies, courts should frown
upon any attempt to prolong them.

Every litigation must come to an end once a judgment

becomes final, executory and unappealable. For just as a
losing party has the right to file an appeal within the
prescribed period, the winning party also has the
correlative right to enjoy the finality of the resolution of
his case by the execution and satisfaction of the
judgment, which is the life of the law. Any attempt to
thwart this rigid rule and deny the prevailing litigant his
right to savour the fruit of his victory must immediately
be struck down. The statute of limitations has not been
devised against those who wish to act but cannot do so,
for causes beyond their control.
13

14

WHEREFORE, we GRANT the Petition of Esteban Yau in

G.R. No. 158848 and DENY the petition of Arturo
Macapagal in G.R. No. 171994. The Decision of the Court
of Appeals in CA-G.R. SP No. 72202 is REVERSED, while
the Decision of the Court of Appeals in CA-G.R. SP No.
60106 is AFFIRMED. The RTC, Branch 6, Cebu City, is
directed to order its sheriff to continue the
implementation of the writ of execution issued in Civil
Case No. CEB-2058 until the award in favor of petitioner
Esteban Yau shall have been fully satisfied.
Costs against Ricardo C. Silverio, Sr. and Arturo
Macapagal.
SO ORDERED.
Puno (C.J.,
Chairperson), Azcuna,Leonardo-De
Castro andReyes, JJ., concur.
Corona, J., No Part. Close relation to a party.
Petition in G.R. No. 158848 granted, while in G.R. No.
171994 denied.
**

BANGKOK
BANK
PUBLIC
COMPANY
LIMITED,
petitioner, vs. THELMA U. LEE, MAYBELLE L. LIM, DANIEL
U. LEE, SAMUEL U. LEE and MIDAS DIVERSIFIED EXPORT
CORPORATION, respondents.
Actions; Judgments; Partial
Judgments; Appeals; Appeal
must be deemed to include the prior partial judgment as
amended.The Notice of Appeal filed by respondents stated
that they were appealing the subsequent decision dated May
31, 2002, which disposed of the remaining factual issues. To
our mind, the said appeal must be deemed to include the prior
partial judgment as amended. The decision on the remaining
factual issues is not the final and appealable judgment that
finally disposes of the case on the merits. It must, therefore,
only be appealed together with the amended partial judgment.
Same; Same; Same; Same;Executions
Pending
Appeal;When an appeal has been duly perfected, though not
yet finally resolved, the execution is not a matter of right, but
of discretion provided good reasons therefore exist; The
compelling grounds for the issuance of the writ must be stated
in a special order after due hearing.Having settled the first
and second issues, we come to the third. We note that when
the RTC ordered the issuance of a writ of execution, judgment
had already been rendered on the remaining factual issues
such that the partial judgment had become a complete
judgment. Thus, a writ of execution could already issue.
However, since appeal had been duly perfected, though not
yet finally resolved, execution was not a matter of right, but of
discretion provided good reasons therefor existed. The
compelling grounds for the issuance of the writ must be stated
in a special order after due hearing.
Same; Same; Same; Same;Same; When the order of
execution is not in conformity with the rules, the same is null
and void.The assailed Order of the trial court, which granted
the motion for execution pending appeal, fell short of the

requirements of Section 2, Rule 39. Where the order of

execution is not in conformity with the rules, the same is null
and void. Therefore, the Court of Appeals did not err in
declaring the said Order nullified.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Sycip,
Salazar,
Hernandez
&
Gatmaitan for
petitioner.
Racela, Manguera & Fabie and Macam, Larcia,
Elbinias, Ulep for respondents.
QUISUMBING, J.:
For review on certiorari is the Decision dated July 4, 2003
of the Court of Appeals in CA-G.R. SP No. 76078, which
nullified the February 12, 2003 Order of the Regional Trial
Court (RTC) of Makati City, Branch 141. The said RTC
Order directed the execution of the Decision dated May
31, 2002 and thePartial Decision dated March 23, 2000,
as amended by Resolution of June 19, 2000.
The facts, as borne by the records, are as follows:
Petitioner Bangkok Bank Public Company Limited is a
foreign corporation engaged in the banking business in
the Philippines.
Respondent Midas Diversified Export Corporation
(Midas for brevity) is a corporation organized under
Philippine laws. Individual respondents Thelma U. Lee,
Maybelle L. Lim, Daniel U. Lee, and Samuel U. Lee are the
owners, directors, and managers of Midas.
Sometime in 1996, petitioner provided Midas a credit
line of about $2,000,000. When Midas refused to pay its
outstanding obligation, petitioner, on May 7, 1998, filed
with the Regional Trial Court of Makati City, Branch 141,
1

an Amended Complaint for Sum of Money with an Urgent

Application for Issuance of a Writ of Preliminary
Attachment docketed as Civil Case No. 98-628 against
respondents.
After respondents filed an Answer, petitioner filed a
Motion for Judgment on the Pleadings and/or Summary
Judg-ment. The motion was denied. Petitioner filed a
Motion for Reconsideration praying for a partial judgment.
The trial court found that a partial judgment can be
rendered. The only remaining factual issues would be: (1)
petitioners entitlement to the writ of preliminary
attachment; and (2) the parties claim for damages
against each other. In a Partial Decision dated March 23,
2000, the trial court ruled:

2. 2.Amending the dispositive

decision to read as follows:

portion

of

the

partial

WHEREFORE, partial decision is hereby rendered ordering

defendants Midas Diversified Export Corporation and individual
defendants Thelma Lee, Maybelle L. Lim, Daniel U. [Lee] and
Samuel U. Lee, jointly and severally, to pay plaintiff the sum of
US$1,998,554.60 plus legal rate of interest at 12% per
annum effective upon the filing of the complaint on 12 March
1998 until fully paid; and ordering the same individual
defendants to pay, jointly and severally, plaintiff the sum of
US$800,000.00 representing the account of MHI plus legal rate
of interest at 12% per annumeffective upon the filing of the
amended complaint on 7 May 1998 until fully paid.
SO ORDERED.

10

However, in its Resolution dated June 19, 2000, the trial

court amended the afore-quoted fallo, to wit:
11

WHEREFORE, in view of all the foregoing, Resolution is hereby

issued:
1. 1.Denying defendants motion for reconsideration of the
partial decision.

WHEREFORE, partial decision is hereby rendered ordering defendant

Midas Diversified Export Corporation and individual defendants
Thelma Lee, Maybelle L. Lim, Daniel U. Lee and Samuel U. Lee, jointly
and severally, to pay plaintiff the sum of US$1,998,554.60 plus legal
rate of interest at 12% per annum effective on 28 January 1998 when
the account became due and payable until fully paid, and liquidated
damages equivalent to 24% of the principal amount due, per annum,
effective from said due date until fully [paid]; ordering the same
individual defendants to pay, jointly and severally, the sum of
US$800,000.00 representing the account of MHI plus legal rate of
interest of 12% per annum effective on 27 February 1999 when the
account became due and demandable until fully paid, and liquidated
damages equivalent to 24% of the principal amount per
annum effective from said due date until fully paid.

3. Granting plaintiffs motion for execution pending appeal

perforce ordering the immediate execution of the partial
decision.
SO ORDERED.

12

Not content, respondents filed before the Court of

Appeals a Petition for Certiorari with Application for
Temporary Restraining Order and/or Writ of Preliminary
Injunction.
The appellate court upheld the decision of the trial
court. However, it ruled that a partial decision cannot be
the subject of execution until after judgment is rendered
on the entire case. In a Decision promulgated on February
28, 2001, the portion ordering the immediate execution
of the partial decision was annulled and set aside.
Subsequently, on May 31, 2002, the trial court issued a
Decision upholding the validity of the writ of preliminary
attachment and dismissing defendants claim for
damages for lack of evidence.
13

14

15

16

On July 11, 2002, petitioner filed a motion for execution

pending appeal. The next day, July 12, 2002, respondents
filed with the trial court a Notice of Appeal of its May 31,
2002 decision.
Meanwhile, on February 12, 2003, the trial court issued
the assailed Order granting the motion for execution
pending appeal. A Writ of Execution of the partial
decision as amended and of the decision on the
remaining issues was promptly issued on February 20,
2003.
However, respondents filed anew before the Court of
Appeals a Petition for Certiorari with Preliminary
Injunction/Temporary Restraining Order impugning the
February 12, 2003 Order of the trial court. The appellate
court granted the petition. It held that the assailed Order
failed to state good reasons to justify immediate
execution.
Hence, the instant petition for review anchored on the
following grounds:
17

18

19

I.
Whether or not the Partial Decision is subject to judicial review,
and whether or not Respondents liability to pay the Bank is
now the law of the case.
II.
Assuming that the Partial Decision could still be appealed,
whether or not Respondents had appealed the Partial Decision.
III.

subsequent decision on the remaining factual issues.

Petitioner claims the partial decision was never appealed
and has therefore become final and executory.
Further, petitioner posits that since the RTC has ruled
on the remaining factual issues, the partial decision is no
longer an interlocutory but a final order that may already
be the subject of execution.
However, respondents counter that the appeal from
the trial courts decision on the remaining issues
necessarily included appeal of its partial decision. They
insist that the partial decision has been integrated in the
decision on the remaining issues. Further, they argue that
the remaining issues are intimately related to the matters
contained in the partial decision.
Lastly, respondents argue that the February 12, 2003
Order of the trial court granting execution pending appeal
did not state good reasons to justify the same; and that in
fact, no good reason exists to warrant execution pending
appeal.
We find no merit in the petition.
The Notice of Appeal filed by respondents stated that
they were appealing the subsequent decision dated May
31, 2002, which disposed of the remaining factual issues.
To our mind, the said appeal must be deemed to include
the prior partial judgment as amended. The decision on
the remaining factual issues is not the final and
appealable judgment that finally disposes of the case on
the merits. It must, therefore, only be appealed together
with the amended partial judgment.
Having settled the first and second issues, we come to
the third. We note that when the RTC ordered the
issuance of a writ of execution, judgment had already
been rendered on the remaining factual issues such that
21

Assuming that the Partial Decision is not final and

executory, whether or not there are nonetheless good reasons
justifying its execution pending appeal.
20

Petitioner contends that respondents Notice of Appeal

clearly indicated that they were only appealing the

the partial judgment had become a complete judgment.

Thus, a writ of execution could already issue.
However, since appeal had been duly perfected,
though not yet finally resolved, execution was not a
matter of right, but of discretion provided good reasons
therefor existed. The compelling grounds for the issuance
of the writ must be stated in a special order after due
hearing.
Section 2, Rule 39 of the Rules of Court provides:
SEC. 2. Discretionary execution.
(a) Execution of a judgment or a final order pending appeal.
On motion of the prevailing party with notice to the adverse
party filed in the trial court while it has jurisdiction over the
case and is in possession of either the original record or the
record on appeal, as the case may be, at the time of the filing
of such motion, said court may, in its discretion, order
execution of a judgment or final order even before the
expiration of the period to appeal.
After the trial court has lost jurisdiction, the motion for
execution pending appeal may be filed in the appellate court.
Discretionary execution may only issue upon good reasons
to be stated in a special order after due hearing. (Italics ours.)
...

Unfortunately, the assailed Order of the trial court failed

to state good reasons for the issuance of the writ. The
trial court deemed that execution should issue as a
matter of right because it mistakenly held that the partial
decision had become final and executory. As discussed
above, the latter proposition is without legal basis.
Clearly, the assailed Order of the trial court, which
granted the motion for execution pending appeal, fell
short of the requirements of Section 2, Rule 39. Where
the order of execution is not in conformity with the rules,

the same is null and void. Therefore, the Court of Appeals

did not err in declaring the said Order nullified.
WHEREFORE, the assailed Decision dated July 4, 2003
of the Court of Appeals in CA-G.R. SP No. 76078, which
nullified the February 12, 2003 Order of the Regional Trial
Court of Makati City, Branch 141, is AFFIRMED. Costs
against petitioner.
SO ORDERED.
Carpio, Carpio-Morales and Tinga, JJ., concur.
Assailed decision affirmed.
Notes.Where two issues do not arise from two or
more causes of action but from the same cause of action,
there is no ground for the splitting of appeals, even if it
involves an Order granting (and denying) a motion to
dismiss and a partial judgment granting a motion for
judgment on the pleadings. (Roman Catholic Archbishop
of Manila vs. Court of Appeals, 258 SCRA 186 [1996])
22

If demurrer is granted and the accused is acquitted by

the court, the accused has the right to adduce evidence
on the civil aspect of the case unless the court also
declares that the act or omission from which the civil
liability may arise did not exist. What the trial court
should then do is to issue an order or partial judgment
granting the demurrer to evidence and acquitting the
accused, and set the case for continuation of trial for the
accused to adduce evidence on the civil aspect of the
case, and for the private complainant to adduce evidence
by way of rebuttal after which the parties may adduce
their sur-rebuttal evidence. (Salazar vs. People,411 SCRA
598 [2003])

INTRAMUROS TENNIS CLUB, INC. (ITC), PHILIPPINE TENNIS

ASSOCIATION (PHILTA) and ITC TENNIS PLAYERS,
petitioners, vs. PHILIPPINE TOURISM AUTHORITY (PTA),
CLUB INTRAMUROS, and COURT OF APPEALS, Second
Division, respondents.
Judgments; Executions
Pending
Appeal; Requisites.
Based on the foregoing provisions, respondent court may order
execution pending appeal subject to the following conditions:
(1) there must be a judgment or final order; (2) the trial court
must have lost jurisdiction over the case; (3) there must be
good reasons to allow execution; and (4) such good reasons
must be stated in a special order after due hearing.
Same; Same; Judgments;Words and Phrases; A final
judgment or order is one that finally disposes of a case,
leaving nothing more for the court to do in respect thereto
while an interlocutory order is one that does not finally
dispose of the case; A final judgment or order becomes
final and executory upon expiration of the period to appeal
therefrom where no appeal has been duly perfected or, an
appeal therefrom having been taken, the judgment of the
appellate court in turn becomes finalit is called a final and
executory judgment because execution at such point issues
as a matter of right.A final judgment or order is one that
finally disposes of a case, leaving nothing more for the court to
do in respect theretosuch as an adjudication on the merits
which, on the basis of the evidence presented at the trial,
declares categorically what the rights and obligations of the
parties are and which party is in the right, or a judgment or
order that dismisses an action on the ground of res judicata or
prescription, for instance. It is to be distinguished from an
order that is interlocutory, or one that does not finally
dispose of the case, such as an order denying a motion to
dismiss under Rule 16 of the Rules of Court, or granting a
motion for extension of time to file a pleading. As such, only

final judgments or orders (as opposed to interlocutory orders)

are appealable. Now, a final judgment or order in the sense
just described becomes final and executory upon expiration
of the period to appeal therefrom where no appeal has been
duly perfected or, an appeal therefrom having been taken, the
judgment of the appellate court in turn becomes final. It is
called a final and executory judgment because execution at
such point issues as a matter of right.
Same; Same; By its provisional nature, the remedy of
execution pending appeal requires only a final judgment or
order (as distinguished from an interlocutory order and not a
final and executory judgment or order.By its provisional
nature, the remedy of execution pending appeal requires only
a final judgment or order (as distinguished from an
interlocutory order) and not a final and executory
judgment or order. In the instant case, the RTC order dated
August 5, 1997 which granted private respondents motion to
dismiss, lifted the writ of preliminary injunction and held
private respondents entitled to possess the Victoria Tennis
Courts is a final order within the contemplation of Section 2,
Rule 39 of the Revised Rules of Court, inasmuch as it makes an
adjudication on the merits of the case and dismisses
petitioners action. Petitioners, in fact, impliedly recognized the
finality of this RTC order when they filed an ordinary appeal
(and not a petition for certiorari) therefrom with respondent
court.
Same; Dispositive Portions;Although as a rule, execution
must conform to the dispositive portion of a decision, the other
parts of the decision may be resorted to in order to determine
the ratio decidendi of the court. Addressing petitioners
argument that the dispositive portion of the RTC order dated
August 5, 1997 only provides that private respondents motion
to dismiss is granted and does not order private respondents
to regain possession of the Victoria Tennis Courts, suffice it to
say that although as a rule, execution must conform to the

dispositive portion of a decision, the other parts of the decision

may be resorted to in order to determine the ratio decidendi of
the court.
Same; Execution Pending Appeal; Due Process; A motion
for execution pending appeal may be granted without a fullblown or trial-type hearing; Due process basically entails
opportunity to be heard and the same principle underlies the
provision on hearing in Section 2 of Rule 39.On the matter of
hearing, we uphold respondents position that respondent
court did not gravely abuse its discretion in granting the
motion for execution pending appeal without a full-blown or
trial-type hearing. We have interminably declared that due
process basically entails the opportunity to be heard, and we
hold that the same principle underlies the provision on hearing
in Section 2 of the abovecited Rule 39. The records of the
instant case clearly disclose that petitioners have filed their
comment to private respondents motion for execution pending
appeal, and their arguments as embodied in said comment did
in fact form part of the discussion of respondent court in its
assailed resolution of July 9, 1998.
Same; Same; Words and Phrases; Execution of a judgment
pending appeal is an exception to the general rule that only a
final judgment may be executed, thus the existence of good
reasons is essential for it is what confers discretionary power
on a court to issue a writ of execution pending appeal; Good
reasons consist of compelling circumstances justifying
immediate execution lest judgment becomes illusory, or the
prevailing party after the lapse of time be unable to enjoy it,
considering the tactics of the adverse party who may have
apparently no case but to delay.Execution of a judgment
pending appeal is an exception to the general rule that only a
final judgment may be executed. Thus, the existence of good
reasons is essential for it is what confers discretionary power
on a court to issue a writ of execution pending appeal. These
reasons must be stated in a special orderfor unless they are

divulged, it would be difficult to determine whether judicial

discretion has been properly exercised in the case. Good
reasons consist of compelling circumstances justifying
immediate execution lest judgment becomes illusory, or the
prevailing party after the lapse of time be unable to enjoy it,
considering the tactics of the adverse party who may have
apparently no case but to delay. There must be superior
circumstances demanding urgency which will outweigh the
injury or damages should the losing party secure a reversal of
the judgment. Were it otherwise, execution pending appeal
may well become a tool of oppression and inequity instead of
an instrument of solicitude and justice.
Injunctions; Possession; The restoration of the owner into
the possession and management of the premises is in order as
a necessary consequence of the lifting of the preliminary
injunction and the termination of the Memorandum of
Agreement or Lease Agreement.PHILTA no longer had any
legal right to the possession and management of the Victoria
Tennis Courts because the lease agreement between PTA and
PHILTA had already expired on June 15, 1997. Obviously, PTA as
the lessor and owner of the tennis courts had every right to
regain possession thereofand it also had every reason to be
alarmed at the complaint filed by the tennis players with the
Department of Tourism because it would be held accountable
as owner and administrator of the tennis courts for the ill
conditions of the said tennis courts. As also observed by
respondent court, after all, upon the expiration of the lease
agreement, the plaintiffs-appellants (petitioners herein) were
no longer obliged to properly maintain the property. Clearly,
the restoration of PTA into the possession and management of
Victoria Tennis Courts is in order, being a necessary
consequence of the lifting of the preliminary injunction and the
termination of the MOA or lease agreement, and does not
prejudice in any way the resolution of the other issues in
petitioners pending appeal with respondent court such as

their claim for damages from PTA which petitioners admit to be

independent of the terms of the MOA. Thus, we find that
respondent court did not gravely abuse its discretion in finding
good reasons for allowing private respondents motion for
execution pending appeal.
Same; Appeals; Judgments in actions for injunction are not
stayed by the pendency of an appeal taken therefrom.
Judgments in actions for injunction are not stayed by the
pendency of an appeal taken therefrom. This rule has been
held to extend to judgments decreeing the dissolution of a writ
of preliminary injunction, which are immediately executory.
Appeals; Except in cases where the appeal is patently or
unquestionably intended to delay, the ground that the appeal
is dilatory must not be made the basis of execution pending
appeal if only to protect and preserve a duly exercised right to
appeal.We modify respondent courts findings to the extent
that it held petitioners appeal pending therewith to be clearly
dilatory, and cited this as one of the reasons for allowing
execution pending appeal. This assumption prematurely judges
the merits of the main case on appeal, and except in cases
where the appeal is patently or unquestionably intended to
delay it must not be made the basis of execution pending
appeal if only to protect and preserve a duly exercised right to
appeal.

private respondents motion for execution pending appeal

and ordered the Regional Trial Court of Manila, Branch 50
to issue the corresponding writ of execution. The
antecedent facts are as follows:
Private respondent Philippine Tourism Authority (PTA)
owns the Victoria Tennis Courts located in Intramuros,
Manila by virtue of Presidential Decree No. 1763. In a
Memorandum of Agreement (MOA) executed on June
11, 1987, the PTA transferred the management,
operation, administration and development of the Victoria
Tennis Courts to petitioner Philippine Tennis Association
(PHILTA) for a period often (10) years commencing on
June 15, 1987. Petitioner Intramuros Tennis Club, Inc.
(ITC) is an affiliate of PHILTA and has for its members
tennis players and enthusiasts who regularly use the
facilities of the Victoria Tennis Courts.
On June 26, 1995, and during the effectivity of the
MOA, PTA wrote a letter to PHILTA enumerating alleged
violations by PHILTA of the terms and conditions of the
MOA and demanding the surrender of the possession of
the Victoria Tennis Courts on or before July 25, 1995. On
April 11, 1996, PTA wrote a second letter to PHILTA
requesting the latter to vacate the premises of said tennis
courts to give way to PTAs golf course expansion
program with private respondent Club Intramuros.
On May 7, 1996, petitioners instituted a case for
preliminary injunction, damages, and prayer for
temporary restraining order with the Regional Trial Court
of Manila, which was docketed as Civil Case No. 9678248. The petition alleged that PTAs demand to vacate
was a unilateral pre-termination of the MOA, under the
terms of which PHILTA was allowed the management of
the tennis courts until June 15, 1997. It also alleged that
by complying with PTAs demand to vacate, petitioner ITC
stands to sustain liability because it had prior
1

SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.

The facts are stated in the opinion of the Court.
Pedro R. Lazo for petitioners.
Teodoro M. Hernandezfor private respondents.
The Chief, Legal Services Division for Respondent
PTA.
GONZAGA-REYES, J .:
This petition for certiorari assails two resolutions of the
Second Division of the Court of Appeals which granted

commitments to use the Victoria Tennis Courts for two

activities, namely, the International Wheelchair Tennis
Clinic on May 14-16, 1996 and the Philippine National
Games on May 20-25, 1996. The other grounds cited by
petitioners were: the Victoria Tennis Courts are the oldest
in the country, and form part of Philippine history and
cultural heritage; the Victoria Tennis Courts are one of the
few remaining public tennis courts in Metro Manila open
to the less affluent; petitioners are maintaining the tennis
courts at high cost, and unless the demolition is
restrained, they will be unable to recoup their
investments; the demolition will result in the
displacement of the workers in the tennis courts; and, as
players and aficionados of tennis, petitioners stand to
lose the camaraderie that playing in Victoria Tennis
Courts helped foster among them.
The temporary restraining order was granted on May
22, 1996, and petitioners were allowed to retain
possession of the Victoria Tennis Courts.
Thereafter, or on June 17, 1996, the RTC also granted
the writ of preliminary injunction prayed for by
petitioners, based upon a finding that PTA in pursuing the
golf course expansion program was in effect unilaterally
pre-terminating the MOA. In the same order, it declared
that petitioner ITC is an affiliate of PHILTA that has a
right to be protected.
On June 16, 1997, private respondents filed a motion to
dismiss, stating that in view of the expiration of the MOA
petitioners cause of action was rendered moot and
academic. However, petitioners maintained that their
petition was also an action for damages; hence, there are
other issues for resolution despite the termination of the
MOA.
The RTC granted the motion to dismiss, finding that
based on the allegations of the petition in relation to the
5

reliefs demanded, petitioners only purpose was to stop

PTA from pursuing the golf course expansion program on
account of the tennis activities that will utilize Victoria
Tennis Courts as venue. It also found that the evidence
submitted by the parties at the trial revolved around the
issue of whether the preliminary injunction should be
declared permanent or lifted. This issue has resolved
itself when the MOA expired. The RTC noted that by the
terms of the MOA the contract between PTA and PHILTA
was actually one of leaseand under the law on leases,
upon the expiration of the period of lease the lessor is
entitled to be restored to the possession of the property.
Moreover, the RTC declared, the petition before it
cannot be considered an action for damages because
based on standing case law the amount of damages must
be stated in the complaint for purposes of determining
jurisdiction and the appropriate amount of docket
fees. The court did not take cognizance of petitioners
claim for damages considering that the amount thereof
was nowhere mentioned in the petition, whether in the
prayer or in the body of said pleading.
Hence, the RTC ruled to lift the writ of preliminary
injunction and to declare private respondent PTA entitled
to the possession of Victoria Tennis Courts. It further
declared that petitioners action has become moot and
academic by reason of the expiration of the MOA upon
which petitioners rights were based.
Petitioners appealed to respondent court. While the
case was pending therewith, private respondents filed a
motion for execution of judgment pending appeal
invoking that under Section 4, Rule 39 of the 1997
Revised Rules of Court judgments in actions for injunction
are not stayed by appeals taken therefrom. Thus:
6

Sec. 4. Judgments not stayed by appeal.Judgments in actions

for injunction, receivership, accounting and support, and such

other judgments as are now or may hereafter be declared to

be immediately executory, shall be enforceable after their
rendition and shall not be stayed by an appeal taken
therefrom, unless otherwise ordered by the trial court. On
appeal therefrom, the appellee court in its discretion may
make an order suspending, modifying, restoring or granting
the injunction, receivership, accounting, or award of support.
(Italics supplied)

The motion alleged that there was an urgent necessity on

the part of private respondents to immediately take
possession of the Victoria Tennis Courts by reason of its
being heavily deteriorated and unsanitized because of
[petitioners] failure to maintain its good condition. It
appended a letter by a group of tennis players, addressed
to Tourism Secretary Mina T. Gabor, complaining about
the state of the facilities and general uncleanliness of the
tennis courts and appealing that the depredations
committed by PHILTA and its concessionaires be
corrected. The motion also alleged that the appeal taken
by petitioners was frivolous and intended merely to delay
the immediate execution of the judgment of the RTC.
In their comment to the above motion, petitioners
stated that private respondents reliance on Section 4,
Rule 39 of the Revised Rules of Court was erroneous
because that provision contemplates an instance where
an action for injunction was granted, not a situation as
the one herein where the judgment was for the lifting of
an injunction earlier issued. Rather, petitioners maintain
that the applicable provision is Section 2, Rule 39 of the
Revised Rules of Court, which accords the appellate court
discretionary power to order execution of a judgment or
final order pending appeal, upon good reasons to be
stated in a special order after due hearing.
Petitioners further contended that the deterioration
and unsanitary conditions of Victoria Tennis Courts
7

alleged by private respondents were unsubstantiated and

do not constitute good reasons for the wielding by
respondent court of its power of discretionary execution.
They maintained that their appeal is not merely dilatory,
but poses several justiciable issues including the claim for
damages which was aborted by the RTCs premature
dismissal of the petition. Thus, respondent court should,
in the exercise of its discretion whether or not to allow
execution pending appeal, lean towards the preservation
of petitioners right to appeal.
In a resolution dated July 9, 1998, the Second Division
of respondent court took into consideration the ground
advanced by private respondents, i.e., that the Victoria
Tennis Courts are illmaintained by PHILTA. It granted the
motion for execution pending appeal, declaring that since
the lease agreement under the MOA had already expired
and private respondents had made it clear that there will
be no renewal of the said agreement, PTA as lessor is
entitled to exercise all its rights of ownership and
possession over the Victoria Tennis Courts. It also
observed that the petitioners appeal from the order of
the RTC was merely dilatory, and that the outcome of the
appeal will not in any way alter the fact of private
respondents entitlement to the possession and
administration of the Victoria Tennis Courts. Thus, the
dispositive portion of respondent courts resolution
provides:
8

WHEREFORE, for the special reasons set forth above, the

motion for execution pending appeal is hereby GRANTED upon
payment and approval of this court of a bond in the amount of
P800,000.00.
SO ORDERED.

10

In their motion for reconsideration, petitioners argued

that under Section 2, Rule 39 of the Revised Rules of
Court respondent court should have conducted hearings

to ascertain whether there were good reasons to issue

the writ of execution pending appeal. Respondent court
denied their motion for lack of merit, and declared that
contrary to petitioners asseverations, the determination
of good reasons for allowing execution pending appeal
does not strictly require a formal or trial-type hearing;
instead, the parties may be heard by way of pleadings. In
the case of petitioners, their arguments against private
respondents motion for execution pending appeal were
heard when they filed their comment thereto. Moreover,
under Rule 8 of the Revised Internal Rules of the Court of
Appeals

courts resolution dated July 9, 1998 granting the execution

pending appeal.

Section 1. Oral Argument.The necessity or propriety of oral

argument shall be determined by the Justice assigned to study
and report on the case and the oral argument shall be confined
to those matters which he may specify. However, in lieu of oral
arguments, said Justice may allow the parties to file their
respective memoranda within fifteen (15) days from notice.

b.In entertaining a special reason interposed by

private respondents, which was not even inceptually
offered in evidence;

11

Petitioners also contended that the trial court had no

jurisdiction to rule on PTAs possessory rights over the
tennis courts, because the appropriate action to
determine those rights is unlawful detainer which is under
the jurisdiction of MTCs. Respondent court dismissed the
argument stating that it was inconsistent of petitioners to
now question the RTCs jurisdiction, considering that it
was they who instituted the injunction case before the
RTC; thus, it appears that they were raising this argument
merely because they failed to secure the affirmative
reliefs that they sought from that court.
Thus, the September 23, 1998 resolution of respondent
court reads:
WHEREFORE, the motion for reconsideration is denied for lack
of merit. The Regional Trial Court of Manila, Branch 50 is
hereby ordered to issue a Writ of Execution pursuant to this

12

From the above resolutions of respondent court,

petitioners filed the instant special civil actipn for
certiorari. The petition, filed on November 17, 1998,
alleged that the Court of Appeals committed grave abuse
of discretion in the following:
a.In granting private respondents Motion for
Execution Pending Appeal pursuant to an erroneous
or incorrect provision of the Rules of Court;

c.In consideringwith unfounded bias, petitioners

pending appeal with said respondent courtas
merely intended to delay;
d.In reasoning that the revised Internal Rules of the
Court of Appeals can supersede the Rules of Court;
e.In assuming that possessory reliefs automatically
vest upon private respondents due to the dismissal of
the injunction case; and
f.In directing the RTC Manila, Branch 50, to issue a
Writ of Execution pursuant to the July 9, 1998
Resolution.
Anent the first ground, petitioners allege that respondent
court wrongly quoted the provisions of Section 2, Rule 39
of the Revised Rules of Court, and that the pertinent
provisions are the second and third paragraphs which
declare that after the trial court has lost jurisdiction, it is
the appellate court in the exercise of its discretion and
13

14

upon good reasons that may issue the motion for

execution pending appeal. They maintained that the
special reason interposed by private respondents, i.e.,
that the Victoria Tennis Courts were ill-maintained, was a
bare allegation that was not properly substantiated,
because the letter of the tennis players to Secretary
Gabor was not formally submitted in evidence in the trial
court. Moreover, they declared, there was no judgment
or final order to speak of in the instant case because
the RTC order dated August 5, 1997 was still the subject
of an appeal that is pending with respondent court. They
also assailed the conclusion of respondent court that the
appeal was dilatory considering that petitioners had
several causes of action which transcend the lease
relationship in the MOA. The fourth assignment of error,
meanwhile, asserts that petitioners were entitled to a
hearing under Section 2, Rule 39 of the Revised Rules of
Court and respondent court erroneously dispensed
thereof in favor of the provisions of the Internal Rules of
the Court of Appeals that memoranda may be required of
the parties in lieu of a hearing. Finally, petitioners argued
that respondent court acted hastily and prematurely in
ordering the trial court to issue a writ of execution for
private respondents to gain possession over the tennis
courts, when the dispositive portion of the RTC order
lifting the preliminary injunction made no mention of
giving possession to private respondents. As declared by
petitioners, the dispositive portion of the RTC order dated
August 5, 1997 merely reads:
15

WHEREFORE, premises considered, the motion to dismiss filed

by PTA is hereby granted. The bond posted by plaintiff is
hereby declared released.
16

In
response
to
petitioners
arguments,
private
respondents declared that no grave abuse of discretion
may be imputed to respondent court for allowing

execution pending appeal to prosper. The matter of good

reasons as basis of an execution pending appeal is a
question that lies within the sound discretion of
respondent court, and its finding in the herein case as to
the existence of such good reasons should be given
respect and credence in the absence of evident bad
faith. Moreover, execution pending appeal is only a
provisional remedy that respondent court allowed private
respondents to avail of and should not be interpreted as
an adjudication on the merits of the main case still
pending before respondent court.
Shortly after the filing of the instant petition, or on
October 21, 1998, private respondents filed a motion for
issuance of a writ of execution with the RTC of Manila,
Branch 50, pursuant to the resolutions of respondent
court dated July 9, 1998 and September 23, 1998. This
motion, however, was not granted by the RTC which, in
an order penned by then presiding judge Urbano C.
Victorio, Sr., suspended or held in abeyance the issuance
of the writ of execution because the records of Civil Case
No. 96-78248 are still with respondent court and also in
deference to the Supreme Court where the instant
petition is pending. In a second order which denied
private respondents motion for reconsideration, Judge
Victorio additionally noted that since the principal cause
of action in Civil Case No. 96-78248 was for the issuance
of a writ of preliminary injunction and the same has been
cancelled or revoked by the RTC on August 5, 1997, there
was nothing more for the RTC to execute.
Undaunted
by
these
developments,
private
respondents filed with the RTC a Second Motion for
Issuance of Writ of Execution With Leave of Court on
November 11, 1999. Private respondents reasoned that
the mere pendency of a special civil action for certiorari,
commenced in relation to a case pending execution
17

18

19

before a lower court, cannot prevent the said lower court

from effecting execution in the absence of a writ of
injunction from a higher court restraining it from doing so,
and in the absence of a final determination from the
Supreme Court that the Court of Appeals gravely abused
its discretion in ordering the RTC to issue the writ of
execution. This motion was granted on February 4, 2000
by Judge Concepcion S. Alarcon-Vergara, who assumed
office as presiding judge of RTC Manila, Branch 50 after
the retirement of Judge Victorio. Thus, a writ of execution
was issued on February 17, 2000 ordering the Sheriff of
RTC Manila, Branch 50 to cause petitioners to vacate the
premises of Victoria Tennis Courts and to place private
respondents in possession of the same.
Petitioners attempted to secure before this Court a
restraining order against the implementation of the above
writ of execution, arguing that such implementation
would render the instant petition moot and academic. The
Court, however, denied their motion in a resolution dated
March 15, 2000.
In their memorandum dated May 27, 2000, private
respondents informed the Court that on March 1, 2000
they had gained actual control and possession of the
Victoria Tennis Courts. Thus, they submit that the instant
petition is now moot and academic.
Preliminarily, we find that the petition was not
rendered moot or illusory by the fact that execution was
effected and possession of the tennis courts restored to
private respondents. The resolution of the instant petition
requires a determination of whether respondent Court of
Appeals gravely abused its discretionary power to order
execution pending appeal as prescribed in Section 2, Rule
39 of the 1997 Revised Rules of Court, and where such
grave abuse of discretion is established the execution
pending appeal pursuant to the resolutions of respondent
20

21

22

23

court may be voided. Thus, the Court finds that the

petition presents a live and justiciable controversy.
Section 2, Rule 39 of the Revised Rules of Court reads
Discretionary execution.
(a) Execution of a judgment or final order pending appeal On
motion of the prevailing party with notice to the adverse party
filed in the trial court while it has jurisdiction over the case and
is in possession of either the original record or the record on
appeal, as the case may be, at the time of the filing of such
motion, said court may, in its discretion, order execution of a
judgment or final order even before the expiration of the
period to appeal.
After the trial court has lost jurisdiction, the motion for
execution pending appeal may be filed in the appellate court.
Discretionary execution may only issue upon good reasons
to be stated in a special order after due hearing.

Based on the foregoing provisions, respondent court may

order execution pending appeal subject to the following
conditions: (1) there must be a judgment or final order;
(2) the trial court must have lost jurisdiction over the
case; (3) there must be good reasons to allow
execution; and (4) such good reasons must be stated in a
special order after due hearing.
Undoubtedly, the RTC order dated August 5, 1997
which granted private respondents motion to dismiss and
lifted the writ of preliminary injunction is a final order
within the contemplation of Section 2, Rule 39 of the
Revised Rules of Court. Petitioners maintain that the said
RTC order could not be the proper subject of execution
because it was still appealed to respondent court, but this
merely confuses the concept of a final judgment or
order from one which has become final (or to use the
more established term, final and executory)a
distinction that is definite and settled.

A final judgment or order is one that finally disposes

of a case, leaving nothing more for the court to do in
respect theretosuch as an adjudication on the merits
which, on the basis of the evidence presented at the trial,
declares categorically what the rights and obligations of
the parties are and which party is in the right, or a
judgment or order that dismisses an action on the ground
of res judicata or prescription, for instance. It is to be
distinguished from an order that is interlocutory, or one
that does not finally dispose of the case, such as an order
denying a motion to dismiss under Rule 16 of the Rules of
Court, or granting a motion for extension of time to file a
pleading. As such, only final judgments or orders (as
opposed to interlocutory orders) are appealable. Now, a
final judgment or order in the sense just described
becomes final and executory upon expiration of the
period to appeal therefrom where no appeal has been
duly perfected or, an appeal therefrom having been
taken, the judgment of the appellate court in turn
becomes final. It is called a final and executory
judgment because execution at such point issues as a
matter of right.
By its provisional nature, the remedy of execution
pending appeal requires only a final judgment or order
(as distinguished from an interlocutory order) and not a
final and executory judgment or order. In the instant
case, the RTC order dated August 5, 1997 which granted
private respondents motion to dismiss, lifted the writ of
preliminary injunction and held private respondents
entitled to possess the Victoria Tennis Courts is a final
order within the contemplation of Section 2, Rule 39 of
the Revised Rules of Court, inasmuch as it makes an
adjudication on the merits of the case and dismisses
petitioners action. Petitioners, in fact, impliedly
recognized the finality of this RTC order when they filed
24

25

an ordinary appeal (and not a petition for certiorari)

therefrom with respondent court.
Addressing petitioners argument that the dispositive
portion of the RTC order dated August 5, 1997 only
provides that private respondents motion to dismiss is
granted and does not order private respondents to regain
possession of the Victoria Tennis Courts, suffice it to say
that 3 (though as a rule, execution must conform to the
dispositive portion of a decision, the other parts of the
decision may be resorted to in order to determine
theratio decidendi of the court. In fact, a closer look at
the RTC order shows that the dispositive portion consists
of two paragraphs, thus
26

Accordingly, the writ of preliminary injunction is hereby lifted

and defendant is entitled to possess the Victoria Tennis Court.
WHEREFORE, premises considered, the motion to dismiss
filed by PTA is hereby granted. The bond posted by plaintiff is
hereby declared released. (Italics supplied)
27

Thus, petitioners representation that the RTC order did

not intend to award possession to private respondents of
the disputed property as a result of the lifting of the
preliminary injunction is blatantly without basis.
It is also not contested that at the time the motion for
execution pending appeal was filed, the RTC had already
lost jurisdiction over the case as petitioners appeal had
already been perfected and the records of the case
transmitted to respondent court.
On the matter of hearing, we uphold respondents
position that respondent court did not gravely abuse its
discretion in granting the motion for execution pending
appeal without a full-blown or trial-type hearing. We have
interminably declared that due process basically entails
the opportunity to be heard, and we hold that the same
principle underlies the provision on hearing in Section 2

of the abovecited Rule 39. The records of the instant case

clearly disclose that petitioners have filed their
comment to private respondents motion for execution
pending appeal, and their arguments as embodied in said
comment did in fact form part of the discussion of
respondent court in its assailed resolution of July 9, 1998.
Thus, the only issue remaining is whether respondent
court gravely abused its discretion in finding good
reasons to grant private respondents motion for
execution pending appeal.
Execution of a judgment pending appeal is an
exception to the general rule that only a final judgment
may be executed. Thus, the existence of good reasons
is essential for it is what confers discretionary power on a
court to issue a writ of execution pending appeal. These
reasons must be stated in a special orderfor unless they
are divulged, it would be difficult to determine whether
judicial discretion has been properly exercised in the
case.
Good reasons consist of compelling circumstances
justifying immediate execution lest judgment becomes
illusory, or the prevailing party after the lapse of time be
unable to enjoy it, considering the tactics of the adverse
party who may have apparently no case but to
delay. There must be superior circumstances demanding
urgency which will outweigh the injury or damages should
the losing party secure a reversal of the judgment. Were
it otherwise, execution pending appeal may well become
a tool of oppression and inequity instead of an instrument
of solicitude and justice.
In light of these considerations, the Court has been
very discriminating in the allowance of such exceptional
execution. Thus, mere allegations that the appeal is
dilatory, or that the bond for the early execution has
been duly paid, or that the corporation seeking execution
28

29

30

31

32

33

34

35

36

is in financial distress were held insufficient grounds to

merit execution pending appeal. On the other hand,
where the goods subject of the judgment stand to perish
or deteriorate during the pendency of the appeal, or the
award of actual damages is for an amount which is fixed
and certain, the Court found that good reasons existed
for execution pending appeal to prosper.
At the same time, it must also be remembered that the
determination of the existence of good reasons is also a
discretionary power, and the reviewing court will not
interfere with the exercise of this discretion absent a
showing of grave abuse thereof. In the present case, we
find that respondent court was well within its discretion in
issuing its questioned resolutions, which clearly set out
the reasons for granting private respondents motion for
execution pending appeal. The observation on the
deteriorating and unsanitary conditions of the Victoria
Tennis Courts came from tennis players who regularly,
use the said courts, and there is no indication that the
letter was contrived or fabricated simply to procure for
private respondents the restoration of possession of the
Victoria Tennis Courts. We find no merit to petitioners
contention that the letter is inadmissible because it was
not among those formally offered in evidence during trial
at the RTCthe letter was dated November 10, 1997 and
it could not have formed part of the evidence in trial at
the time the parties formally rested their cases on June
11, 1996. Verily, it could only have been submitted in
evidence before respondent court, while the case was on
appeal therewith.
More importantly, PHILTA no longer had any legal right
to the possession and management of the Victoria Tennis
Courts because the lease agreement between PTA and
PHILTA had already expired on June 15, 1997. Obviously,
PTA as the lessor and owner of the tennis courts had
37

38

39

40

41

every right to regain possession thereofand it also had

every reason to be alarmed at the complaint filed by the
tennis players with the Department of Tourism because it
would be held accountable as owner and administrator of
the tennis courts for the ill conditions of the said tennis
courts. As also observed by tion of United Namarco
Distributors, Inc. vs. National Marketing Corporation, 4
SCRA 867(1962). respondent court, after all, upon the
expiration of the lease agreement, the plaintiffsappellants (petitioners herein) were no longer obliged to
properly maintain the property.
Clearly, the restoration of PTA into the possession and
management of Victoria Tennis Courts is in order, being a
necessary consequence of the lifting of the preliminary
injunction and the termination of the MOA or lease
agreement, and does not prejudice in any way the
resolution of the other issues in petitioners pending
appeal with respondent court such as their claim for
damages from PTA which petitioners admit to be
independent of the terms of the MOA. Thus, we find that
respondent court did not gravely abuse its discretion in
finding good reasons for allowing private respondents
motion for execution pending appeal.
Moreover, judgments in actions for injunction are not
stayed by the pendency of an appeal taken
therefrom. This rule has been held to extend to
judgments decreeing the dissolution of a writ of
preliminary injunction, which are immediately executory.
However, we modify respondent courts findings to the
extent that it held petitioners appeal pending therewith
to be clearly dilatory, and cited this as one of the reasons
for allowing execution pending appeal. This assumption
prematurely judges the merits of the main case on
appeal, and except in cases where the appeal is patently
or unquestionably intended to delay it must not be made
42

43

44

45

the basis of execution pending appeal if only to protect

and preserve a duly exercised right to appeal.
WHEREFORE, the instant petition is DISMISSED. The
validity of the writ of execution issued and implemented
pursuant to the resolutions of the Court of Appeals dated
July 9, 1998 and September 23, 1998 is SUSTAINED. No
costs.
SO ORDERED.
Melo (Chairman),Vitug, Panganiban andPurisima,
JJ. , concur.
Petition dismissed, validity of writ of execution
sustained.

PLANTERS PRODUCTS, INC., petitioner, vs. COURT OF

APPEALS
AND
FERTIPHIL
CORPORATION,
INC.,
respondents.
Actions; Procedural Rules and Technicalities; The rules of
procedure are not to be applied in a very rigid and technical
manner, as rules of procedure are used only to help secure
substantial justicethey cannot be blindly adhered to if they
would serve no other purpose than to put into oblivion the
very lis mota of the controversy under scrutiny.It is true that
the Supplemental Petition could have been raised in the
original petition filed with the Court of Appeals. However, the
Court discerns no legal infirmity, and perceives no ground to
deny due course to the said Supplemental Petition imputing
abuse of discretion on the part of the trial court in issuing the
order of execution pending appeal, as this was precisely the
bottom line of the two petitions before the Court of Appeals. It
bears stressing that the rules of procedure are not to be
applied in a very rigid and technical manner, as rules of
procedure are used only to help secure substantial justice.
They cannot be blindly adhered to if they would serve no other
purpose than to put into oblivion the very lis mota of the
controversy under scrutiny.
Same; Judgments; Appeals;Executions
Pending
Appeal;Discretionary execution is permissible when good
reasons exist for immediately executing the judgment before
finality or pending appeal or even before the expiration of the
time to appeal.The prevailing doctrine thenwhich is the
same as provided in paragraph 2, Section 2 of Rule 39 of the
1997 Rules of Civil Procedureis that discretionary execution
is permissible when good reasons exist for immediately
executing the judgment before finality or pending appeal or
even before the expiration of the time to appeal. Good reasons
consist of compelling circumstances justifying the immediate

execution lest the judgment becomes illusory, or the prevailing

party may after the lapse of time become unable to enjoy it.
Same; Same; Same; Same;Well-settled is the rule that it is
not for the trial court to determine the merit of a decision it
rendered as this is the role of the appellate Court.Although
ascertainment of the special reasons for execution pending
appeal lies within the sound discretion of the trial court, and
the appellate Court should not normally disturb such finding,
intervention by the appellate court may be proper, if it is
shown that there has been an abuse of discretion.That the
appeal was merely dilatory because the assailed letter of
instruction is unconstitutional, does not constitute good
reason to justify execution pending appeal. Well-settled is the
rule that it is not for the trial court to determine the merit of a
decision it rendered as this is the role of the appellate Court.
Hence, it is not within the competence of the trial court, in
resolving the motion for execution pending appeal, to rule that
the appeal is patently dilatory and rely on the same as the
basis for finding good reason to grant the motion.
Same; Same; Same; Same;Mere issuance of a bond to
answer for damages is no longer considered a good reason for
execution pending appeal.Mere issuance of a bond to answer
for damages is no longer considered a good reason for
execution pending appeal. To consider the mere posting of a
bond as a good reason would precisely make immediate
execution of judgment pending appeal routi-nary, the rule
rather than the exception.
Same; Same; Same; Same;Statutory
Construction; The
rule on execution pending appeal must be strictly construed
being an exception to the general rule.The rule on execution
pending appeal must be strictly construed being an exception
to the general rule.Applying the rule on statutory construction,
it should be interpreted only so far as the language thereof
fairly warrants, and all doubts should be resolved in favor of
the general rule rather than the exceptions.

Same; Same; Same; Same;When the Court has already

granted a stay of execution upon the adverse partys filing of a
supersedeas bond, the circumstances justifying execution
despite the supersedeas bond, must be paramountthey
should outweigh the security offered by the supersedeas bond.
Then too, it can be gleaned that there is no good reason to
grant execution pending appeal, under the premises. To
repeat, the ground for granting execution pending appeal must
be a good reason. Thus, when the Court has already granted a
stay of execution upon the adverse partys filing of a
supersedeas bond, the circumstances justifying execution
despite the supersedeas bond, must be paramount; they
should outweigh the security offered by the supersedeas bond.
In the present case, however, the Court discerns no reason
paramount enough to warrant the execution pending appeal.
To rule otherwise would be to make the remedy of execution
pending appeal a tool of oppression and inequity instead of
being an instrument of solicitude and justice.
Same; Same; Same; Same;The
Court is not
under
obligation to act immediately on the supersedeas bond
submittedthe judgment debtor is not entitled to a
suspension as a matter of right.Anent the fourth error
assigned, the Court upholds the ruling that the respondent
court is not under obligation to act immediately on the
supersedeas bond submitted by the petitioners. Under Section
3, Rule 39 of the Revised Rules of Court, the judgment debtor
is not entitled to a suspension as a matter of right. Indeed, it
was in the exercise of its sound judgment that the trial court
required the filing of a written opposition from Fertiphil and a
possible reply from the petitioner.
Same; Same; Same;Certiorari; The remedy of certiorari
under Rule 65 of the Revised Rules of Court is limited to acts
of any tribunal, board, or office exercising judicial function
without or in excess of jurisdiction or with grave abuse of
discretion and is not available for the correction of errors of

judgment which may be raised only on appeal.The

constitutional issues posed are not the proper subjects of the
instant petition seeking to set aside the assailed decision of
the Court of Appeals, considering that the said Court did not,
and could not, in its challenged decision, rule on the
constitutionality of LOI No. 1465. The remedy of certiorari
under Rule 65 of the Revised Rules of Court is limited to acts of
any tribunal, board, or office exercising judicial function
without or in excess of jurisdiction or with grave abuse of
discretion and is not available for the correction of errors of
judgment which may be raised only on appeal. In the case
before the Court, while the respondent court referred to the
findings of the trial court that LOI No. 1465 is unconstitutional,
it did not hold that such finding is correct or incorrect.
Same; Same; Same; Courts;Jurisdiction; The
Court
of
Appeals
which
first
acquired
jurisdiction
over
the
constitutionality of LOI No. 1465 by way of regular appeal,
excludes all others, including the Supreme Court, from passing
upon the validity of subject letter of instruction.The Court of
Appeals properly deferred ruling on the correctness of the
judgment sought to be executed, as the merits of the case
itself were duly submitted to the jurisdiction of the said Court
in the proper case, by way of a regular appeal. Time honored is
the rule that jurisdiction once acquired is not lost upon the
instance of the parties but continues until the case is
terminated. Therefore, the Court of Appeals which first
acquired jurisdiction over the constitutionality of LOI No. 1465
by way of regular appeal, excludes all others, including this
Court from passing upon the validity of subject letter of
instruction.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.

Sycip, Salazar,Hernandez
&
Gatmaitan for
petitioner.
Romulo P. Atencia for private respondent.

1. 1)the sum of P6,698,144.00 with interest at 12% from

the time of judicial demand;

PURISIMA, J.:
At bar is a Petition for Review on Certiorari under Rule 45
of the Revised Rules of Court seeking to annul the
Decision of the Court of Appeals, dated June 19, 1992, in
CA-G.R. No. 2776, which denied the petition to set aside
the Order dated April 8, 1992 of the Regional Trial Court
of Makati, Branch 146, in Civil Case No. 17835.
The antecedent facts are as follows:
On June 3, 1985, for the purpose of rehabilitating
Philippine Planters, Inc., the then President Ferdinand E.
Marcos issued Letter of Instruction (LOI) No. 1465 which
imposed a charge of P10.00 per bag of fertilizer on all
domestic sales of fertilizer in the Philippines.
Respondent Fertiphil Corporation, a domestic entity
engaged in the fertilizer business, questioned the
constitutionality of LOI No. 1465 and brought an action to
recover its accumulated payment thereunder in the
amount of P6,698,144.00, the case docketed as Civil Case
No. 17835 before Branch 147 of the Regional Trial Court
of Makati.
On November 20, 1991, the court of origin declared
Letter of Instruction No. 1465 unconstitutional and
ordered the petitioner to pay the private respondent the
amount it paid pursuant thereto; disposing as follows:

3. 3)the costs of suit.

WHEREFORE, in view of the foregoing, the Court hereby

renders judgment in favor of the plaintiff and against the
defendant Planters Product, Inc., ordering the latter to pay the
former:

2. 2)the sum of P100,000.00 as attorneys fees;

SO ORDERED.

On February 20, 1992, simultaneously with the filing of

petitioners notice of appeal, the private respondent
presented a motion to execute the said decision pending
appeal, but the motion was opposed by the petitioner on
the ground that there was no good reason to warrant
execution pending appeal.
On April 8, 1992, the lower court granted the motion
for execution pending appeal and directed the issuance of
the corresponding writ of execution upon the posting by
private respondent of a bond in the amount of
P6,698,000.00; ratiocinating thus:
Thus, it is clear from the foregoing discussion that the tax
imposition under LOI No. 1465 is null and void and cannot be
justified even under the police power of the state. As a matter
of fact, because it is an invalid tax imposition, the same was
discontinued upon the advent of a free and democratic regime
after the EDSA revolution. Hence, the Court finds that the
appeal of the defendant is not only dilatory but also frivolous.
Anyway, in the remote event of reversal by the appellate
court, there is the bond to answer for the return of these
assets which may be executed pending appeal. It has been
held that the filing of a bond by the prevailing party constitutes
good reason for the issuance of a writ of execution pending
appeal. x x x
WHEREFORE, in view of the foregoing, the court hereby
grants plaintiffs motion for execution pending appeal. Let a
writ of execution issue upon the filing of a bond in the amount
of P6,698,000.00 subject to the approval of the Court.

SO ORDERED.

On April 13, 1997, upon the posting of the requisite bond,

Fertiphil caused the closure of petitioners warehouse in
Sta. Ana, Metro Manila. Stored in that warehouse were
70,000 bags of fertilizer (estimated by Fertiphil to be
47,000 bags only). Also levied upon were twenty-four (24)
Suzuki motorcycles, five (5) Suzuki jeeps and two (2) UV
FMA 220-D motor vehicles. On April 20, 1992, the
properties thus levied upon were sold at public auction,
with Fertiphil as the highest bidder.
On April 14, 1992, petitioner filed with the Court a
quo an Urgent Omnibus Motion, asked for the approval
of its supersedeas bond in the amount of P10,477,902.45,
and prayed that pending approval of the said
supersedeas bond, the lower court:
x x x immediately issue an Order (1) DIRECTING plaintiff
(Fertiphil) and/or the Sheriff of this Honorable Court, as well as
all the persons acting under their supervision and/or
instruction to immediately cease and desist from performing
any act or all acts in furtherance of the execution of the
Decision dated November 1991, and (2) DIRECTING the
immediate release of defendant PPIs abovementioned bank
accounts and funds from garnishment.
5

Petitioner further prayed that the order of execution

pending appeal as well as the writ issued by virtue
thereof be set aside and dissolved; and its omnibus
motion be heard on the following day, April 15, 1992.
Acting thereupon on the same day, the lower court issued
an order giving the private respondent ten (10) days to
submit its opposition to the motion of petitioner, and also
giving petitioner ten (10) days from receipt of the
opposition to reply thereto, if so desired.
Five (5) days later, or on April 20, 1993, to be precise,
petitioner brought a petition for certiorari before the
Court of Appeals on the alleged ground that the lower

court unreasonably failed to act on its Urgent Omnibus

Motion dated April 14, 1992.
On April 21, 1992, the Court of Appeals issued a
Temporary Restraining Order effective until May 11, 1992,
enjoining the private respondent and all persons acting
under their supervision and/or instruction from executing
any further the decision in Civil Case No. 17835. After the
lapse of said period, on May 5, 1992, petitioner presented
an Urgent Motion for the issuance of a writ of preliminary
injunction to prevent private respondent from executing
any further the decision of the trial court.
On May 21, 1992, petitioner asked the Court of Appeals
to admit its supplemental petition for certiorari imputing
abuse of discretion, amounting to lack or excess of
jurisdiction, on the part of the lower court in granting
private respondents motion for execution pending
appeal.
On June 19, 1992, the Court of Appeals came out with
its decision to the following effect:
WHEREFORE, the petition and supplemental petition are
hereby DENIED. The prayer for the issuance of a preliminary
injunction is likewise denied. Costs against petitioner.
SO ORDERED.

Dissatisfied therewith, petitioner found its way to this

Court via the present Petition, contending:
I
THAT THE SUPPLEMENTAL PETITION COULD NO LONGER
QUESTION THE SPECIAL EXECUTION SINCE THIS WAS NOT
RAISED IN THE ORIGINAL PETITION;
II
THAT PPI ADMITTED THE CORRECTNESS OF THE SPECIAL
EXECUTION WHEN IT FILED THE SUPERSEDEAS BOND;

III
THAT THE FOLLOWING WERE GOOD REASONS TO JUSTIFY
ADVANCE EXECUTION: i) FRIVOLOUSNESS OF THE APPEAL
BECAUSE LOI No. 1465 IS UNCONSTITUTIONAL; AND ii) FILING
OF THE BOND OF P6,698,144;
IV
THAT THE TRIAL COURT DID NOT GRAVELY ABUSE ITS
DISCRETION WHEN IT GAVE FERTIPHIL 10 DAYS TO OPPOSE
PPIS SUBMISSION OF SUPERSEDEAS BOND.
V
THAT THE COLLECTION UNDER LOI No. 1465 WAS FOR THE
BENEFIT
OF
PPI
AND
RECEIVED
BY
IT
WITHOUT
CONSIDERATION; and
VI
THAT THE IMPOSITION UNDER LOI No. 1465 WAS IMPROPER
EXERCISE OF TAXATION.
7

The petition is impressed with merit.

It is true that the Supplemental Petition could have
been raised in the original petition filed with the Court of
Appeals. However, the Court discerns no legal infirmity,
and perceives no ground to deny due course to the said
Supplemental Petition imputing abuse of discretion on the
part of the trial court in issuing the order of execution
pending appeal, as this was precisely the bottom line of
the two petitions before the Court of Appeals. It bears
stressing that the rules of procedure are not to be applied
in a very rigid and technical manner, as rules of
procedure are used only to help secure substantial
justice. They cannot be blindly adhered to if they would
serve no other purpose than to put into oblivion the
very lis mota of the controversy under scrutiny.
8

Section 2, Rule 39, of the Rules of Court which was the

applicable provision when the trial court allowed the
execution pending appeal, provided:
Sec. 2. Execution pending appeal.On motion of the
prevailing party with notice to the adverse party, the court
may, in its discretion, order execution to issue, even before the
expiration of the time to appeal, upon good reasons to be
stated in the special order. If a record on appeal is filed
thereafter the motion and the special order shall be included
therein.

The prevailing doctrine thenwhich is the same as

provided in paragraph 2, Section 2 of Rule 39 of the 1997
Rules of Civil Procedureis that discretionary execution is
permissible when good reasons exist for immediately
executing the judgment before finality or pending appeal
or even before the expiration of the time to appeal. Good
reasons consist of compelling circumstances justifying the
immediate execution lest the judgment becomes illusory,
or the prevailing party may after the lapse of time
become unable to enjoy it.
In the present case, the supposed good reasons relied
upon by the trial court, and upheld in by the respondent
Court in granting execution pending appeal are that: 1)
The appeal is frivolous because LOI No. 1465 is
unconstitutional; and 2) Fertiphil posted a bond.
Although ascertainment of the special reasons for
execution pending appeal lies within the sound discretion
of the trial court, and the appellate Court should not
normally disturb such finding, intervention by the
appellate court may be proper, if it is shown that there
has been an abuse of discretion. That the appeal was
merely dilatory because the assailed letter of instruction
is unconstitutional, does not constitute good reason to
justify execution pending appeal. Well-settled is the rule
that it is not for the trial court to determine the merit of a
9

10

decision it rendered as this is the role of the appellate

Court. Hence, it is not within the competence of the trial
court, in resolving the motion for execution pending
appeal, to rule that the appeal is patently dilatory and
rely on the same as the basis for finding good reason to
grant the motion.
So also, mere issuance of a bond to answer for
damages is no longer considered a good reason for
execution pending appeal. To consider the mere posting
of a bond as a good reason would precisely make
immediate execution of judgment pending appeal
routinary, the rule rather than the exception.
The rule on execution pending appeal must be strictly
construed being an exception to the general
rule. Applying the rule on statutory construction, it
should be interpreted only so far as the language thereof
fairly warrants, and all doubts should be resolved in favor
of the general rule rather than the exceptions. In light of
the foregoing, this Court is unable to agree with the Court
of Appeals that the petitioner admitted the correctness of
the special or discretionary execution when it posted the
supersedeas bond. Besides, in its Urgent Omnibus
Motion before the trial court, petitioner prayed that the
Order of the lower court dated April 8, 1992, directing
execution pending appeal, be set aside.
Then too, it can be gleaned that there is no good
reason to grant execution pending appeal, under the
premises. To repeat, the ground for granting execution
pending appeal must be a good reason. Thus, when the
Court has already granted a stay of execution upon the
adverse partys filing of a supersedeas bond, the
circumstances
justifying
execution
despite
the
supersedeas bond, must be paramount; they should
outweigh the security offered by the supersedeas
bond. In the present case, however, the Court discerns
11

12

13

14

15

16

no reason paramount enough to warrant the execution

pending appeal. To rule otherwise would be to make the
remedy of execution pending appeal a tool of oppression
and inequity instead of being an instrument of solicitude
and justice.
Anent the fourth error assigned, the Court upholds the
ruling that the respondent court is not under obligation to
act immediately on the supersedeas bond submitted by
the petitioners. Under Section 3, Rule 39 of the Revised
Rules of Court, the judgment debtor is not entitled to a
suspension as a matter of right. Indeed, it was in the
exercise of its sound judgment that the trial court
required the filing of a written opposition from Fertiphil
and a possible reply from the petitioner.
The constitutional issues posed are not the proper
subjects of the instant petition seeking to set aside the
assailed decision of the Court of Appeals, considering that
the said Court did not, and could not, in its challenged
decision, rule on the constitutionality of LOI No. 1465. The
remedy of certiorari under Rule 65 of the Revised Rules of
Court is limited to acts of any tribunal, board, or office
exercising judicial function without or in excess of
jurisdiction or with grave abuse of discretion and is not
available for the correction of errors of judgment which
may be raised only on appeal. In the case before the
Court, while the respondent court referred to the findings
of the trial court that LOI No. 1465 is unconstitutional, it
did not hold that such finding is correct or incorrect. The
Court of Appeals properly deferred ruling on the
correctness of the judgment sought to be executed, as
the merits of the case itself were duly submitted to the
jurisdiction of the said Court in the proper case, by way of
a regular appeal. Time honored is the rule that jurisdiction
once acquired is not lost upon the instance of the parties
but continues until the case is terminated. Therefore, the
17

18

19

20

21

Court of Appeals which first acquired jurisdiction over the

constitutionality of LOI No. 1465 by way of regular appeal,
excludes all others, including this Court from passing
upon the validity of subject letter of instruction.
In this disposition, the Court limits itself to the wisdom
of the exercise of discretion by the trial court in ordering
the execution of its judgment pending appeal. It is
imperative that this Court allows the main appeal
pending before the Court of Appeals to take its normal
course.
Premises studiedly considered, the Court is of the
ineluctable conclusion, and so holds, that the Court of
Appeals erred in granting the motion to execute pending
appeal the judgment of the trial court in Civil Case No.
17835.
WHEREFORE, the Petition is GRANTED; the decision of
the Court of Appeals, dated June 19, 1992, in CA-G.R. No.
27769 and the Order dated November 20, 1991, of the
Regional Trial Court of Makati, Branch 147, in Civil Case
No. 27769 are SET ASIDE. Fertiphil is hereby ordered to
return all the properties of Philippine Planters, Inc., taken
and sold at the public auction to satisfy the judgment of
the trial court in Civil Case No. 17385, or if return thereof
is not feasible to pay Philippine Planters, Inc. the value of
the said properties, as of the date of the sale thereof. No
pronouncement as to costs.
SO ORDERED.
Melo (Chairman),Vitug and Panganiban, JJ.,concur.
Gonzaga-Reyes, J.,No part, spouse connected with
petitioners counsel.
Petition granted; Reviewed decision set aside.
Note.Even the danger of extinction of the
corporation will not per se justify a discretionary
execution unless there are showings of other good
22

reasons, such as for instance, impending insolvency of

the adverse party or the appeal being patently dilatory; It
is not within the competence of the trial court, in
resolving a motion for execution pending appeal, to rule
that the appeal is patently dilatory and rely on the same
as its basis for finding good reason to grant the motion.
(Philippine Bank of Communications vs. Court of
Appeals, 279 SCRA 364[1997])

FORTUNE GUARANTEE AND INSURANCE CORPORATION,

petitioner,vs. HONORABLE
COURT
OF
APPEALS,
HONORABLE JUDGE HENEDINO P. EDUARTE, RTC, BRANCH
20, CAUAYAN, ISABELA, EGDONA R. MADRIAGA,
PROVINCIAL SHERIFF OF THE REGIONAL TRIAL COURT OF
CAUAYAN, ISABELA OR ANY OF HIS DEPUTIES and
ISABELA I ELECTRIC COOPERATIVE, INC., respondents.
Actions; Appeals; Certiorari;Words and Phrases; Petition
for Review and Certiorari, Compared; The proper remedy of
a party aggrieved by a decision of the Court of Appeals is a
petition for review under Rule 45 which is not similar to a
petition for certiorari under Rule 65 of the Rules of Court;
Decisions, final orders or resolutions of the Court of Appeals in
any cases, i.e., regardless of the nature of the action or
proceeding involved, may be appealed to the Supreme Court
by a petition for review, which would be but a continuation of
the appellate process over the original case, while a special
civil action for certiorari is an independent action based on
specific grounds therein provided and, as a general rule,
cannot be availed of as a substitute for the lost remedy of an
ordinary appeal, including that under Rule 45.At the outset,
it must be pointed out that petitioner adopted the wrong mode
of appeal in bringing this case before us. The proper remedy of
a party aggrieved by a decision of the Court of Appeals is a
petition for review under Rule 45 which is not similar to a
petition for certiorari under Rule 65 of the Rules of Court. This
was clearly addressed by this Court in Heirs of Marcelino
Pagobo vs. CA where we held that as provided in Rule 45 of the
Rules of Court, decisions, final orders or resolutions of the
Court of Appeals in any case,i.e., regardless of the nature of
the action or proceedings involved, may be appealed to us by
filing a petition for review, which would be but a continuation
of the appellate process over the original case. On the other
hand, a special civil action under Rule 65 is an independent

action based on the specific grounds therein provided and, as a

general rule, cannot be availed of as a substitute for the lost
remedy of an ordinary appeal, including that under Rule 45.
Same; Same; Same; When a party adopts an improper
remedy, his petition may be dismissed outright, though, in the
interest of substantial justice, the strict application of
procedural technicalities should not hinder the speedy
disposition of the case on the merits.Accordingly, when a
party adopts an improper remedy, as in this case, his petition
may be dismissed outright. However, in the interest of
substantial justice, the strict application of procedural
technicalities should not hinder the speedy disposition of this
case on the merits. Thus, while the instant petition is one for
certiorari under Rule 65 of the Rules of Court, the assigned
errors are more properly addressed in a petition for review
under Rule 45.
Same; Same; Same; The merits of a case should not be
determined in a petition for certiorari questioning an order
granting execution pending appeal, in advance of the main
appeal taken by the aggrieved party from the judgment
rendered by respondent court.First of all, it is at once
apparent that the first two (2) assignments of errors in this
petition behoove this Court to review the finding made by the
appellate court that the properties of ISELCO-I were not
underinsured. This we cannot do for the simple reason that it
would require us to go into the merits of the decision rendered
by respondent Judge in Civil Case No. Br. 20-436, which
decision in the main case is now subject of a separate appeal
by petitioner to the Court of Appeals. Thus, despite the parties
insistent submission of the question of underinsurance for our
resolution in this petition, we must reiterate the wellestablished rule that the merits of the case should not be
determined at this stage of the proceedings, in advance of the
main appeal taken by the aggrieved party from the judgment
rendered by respondent court.

Same; Same; Execution Pending Appeal; Requisites; As a

general rule, the execution of a judgment should not be had
until and unless the judgment has become final and executory.
As a general rule, the execution of a judgment should not be
had until and unless the judgment has become final and
executory, i.e., the period of appeal has lapsed without an
appeal having been taken, or appeal having been taken, the
appeal has been resolved and the records of the case have
been returned to the court of origin, in which event, execution
shall issue as a matter of right. Execution pending appeal in
accordance with Section 2 of Rule 39 of the Rules of Court is,
therefore, the exception. The requisites for the grant of a
motion for execution pending appeal are: (a) there must be a
motion by the prevailing party with notice to the adverse
party; (b) there must be a good reason for execution pending
appeal; and (c) the good reason must be stated in a special
order.
Same; Same; Same; Same;Anent the requisite that there
must be good reason justifying the execution of the judgment
pending appeal, such good reason must constitute superior
circumstances demanding urgency which will outweigh the
injury or damage should the losing party secure a reversal of
the judgment.Being an exception to the general rule, the
requisites of execution pending appeal must, therefore, be
strictly construed. Thus, anent the requisite that there must be
good reason justifying the execution of the judgment pending
appeal, we have consistently held that such good reason must
constitute superior circumstances demanding urgency which
will outweigh the injury or damage should the losing party
secure a reversal of the judgment. Beyond the guideline set by
jurisprudence, however, statute does not determine,
enumerate, or give examples of what may be considered good
reasons to justify execution pending appeal. What these good
reasons are must, therefore, necessarily be addressed to the
discretion of the court, and in the case of City of Manila vs.

Court of Appeals we said that: xxx If in the mind of the court,

taking into consideration the facts and circumstances
surrounding the case, good reasons exist, the exercise of the
power to issue immediate execution of the judgment cannot be
considered as grave abuse of discretion. Provided there are
good reasons for execution according to the judgment of the
trial judge, such judgment should generally not be interfered
with, modified, controlled, or inquired into by the appellate
court; the latter should generally not substitute its way of
thinking for that of the trial court, otherwise, the discretionary
power given to the trial court would have no meaning. The
appellate court may, however, interfere with that discretion
lodged in the trial court only in case of grave abuse or in case
conditions have so far changed since the issuance of the order
as to necessitate the intervention of the appellate court to
protect the interests of the parties against contingencies which
were not or could have not been contemplated by the trial
judge at the time of the issuance of the order.

SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.

The facts are stated in the opinion of the Court.
Santiago, Arevalo,Tomas & Associates for petitioner.
Eligio A. Labog for private respondent ISELCO I.
DE LEON, JR., J.:
Before us is a Petition for Certiorari under Rule 65 of the
Rules of Court which seeks to annul the twin Resolutions
of the Court of Appeals in CA-GR SP No. 30430 dated
April 19, 1993 and dated June 16, 1993, respectively,
which ultimately dismissed the petition for certiorari of
petitioner Fortune Guarantee and Insurance Corporation
that assailed the Special Order dated February 12, 1993
of respondent Judge Henedino P. Eduarte of the Regional
Trial Court of Cauayan, Isabela, granting execution
1

pending appeal of his Decision in Civil Case No. Br. 20436.

The facts are as follows:
On November 11, 1988, Isabela 1 Electric Cooperative,
Inc. (ISELCO-I) secured Fire Insurance Policy No. 9216
from petitioner for Two Million (P2,000,000.00) Pesos. This
was later on changed to Policy No. 9218 with expanded
coverage to include typhoons and floods. The period
covered by the said amended insurance policy is from
4:00 oclock p.m. of November 11, 1988 to 4:00 oclock
p.m. of November 11, 1989. The properties covered are
all of ISELCO-Is distribution lines, electric posts/poles,
transformers and its accessories, towers and fixtures
installed and/or specifically situated in the towns of Alicia,
Angadanan, Cabatuan, Cauayan, Cordon, Echague, Jones,
Luna, Ramon, San Isidro, San Mateo, Santiago, Reina
Mercedes, San Guillermo and San Agustin all in the
Province of Isabela.
During the subsistence of the insurance policy, the
insured properties of ISELCO-I were destroyed by two (2)
typhoons in 1989; first by typhoon ELANG on July 9 and
second by typhoon TACING on October 19 of the same
year. ISELCO-I filed successive claims with petitioner.
Notwithstanding the several demands made by ISELCO-I,
however, petitioner refused to pay the claims.
On
March
19,
1990,
ISELCO-I,
through
its
representative, filed a complaint against petitioner for a
sum of money in the amount of Two Million
(P2,000,000.00) Pesos with damages before the Regional
Trial Court of Cauayan, Isabela. The case which was
assigned to Branch 20 presided by respondent Judge
Henedino P. Eduarte, was docketed as Civil Case No. Br.
20-436. In answer thereto, petitioner claimed, among
others, that since the total value of the entire properties
insured was Thirty-Six Million (P36,000,000.00) Pesos, it
5

thereby rendered ISELCO-Is properties underinsured by

the Two Million (P2,000,000.00) Pesos insurance policy.
Thus, according to petitioner, ISELCO-I was entitled to
payment of only a fraction of the policys face value or
only One Hundred Eighty-Three Thousand Seven Hundred
Eighty-Five
Pesos
and
Seventy-Three
Centavos
(P183,785.73) instead of the Two Million (P2,000,000.00)
Pesos claimed by ISELCO-I.
On June 17, 1992, after trial on the merits, the trial
court rendered a decision in favor of ISELCO-I, the
dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of the
plaintiff and against the defendant, ordering the defendant
Fortune Guarantee and Insurance Corporation to pay to the
plaintiff Isabela-1 Electric Cooperative, Inc., (ISELCO I) TWO
MILLION (P2,000,000.00) PESOS with interest at the rate of
14% per annum from March 19, 1990 up to and until said
amount shall have been fully paid, attorneys fees in the
amount of P200,000.00 plus P2,500.00 honorarium. Costs
against defendant.
SO ORDERED.

On June 22, 1992, ISELCO-I filed a Motion for Execution

Pending Appeal alleging good reasons for its allowance.
8

On July 13, 1992, petitioner filed a motion for

reconsideration of the Decision of the trial court. On July
23, 1992, ISELCO-I filed its Opposition to the said Motion
for Reconsideration; and on November 13, 1992,
petitioner filed its Opposition to ISELCO-Is Motion for
Execution Pending Appeal on the ground that ISELCO-I
had no good reasons and no clear right to a writ of
execution pending appeal as the subject amount is
enormous.
9

10

11

On October 7, 1992, the trial court denied the said

motion for reconsideration filed by the petitioner.
Thereafter, on November 3, 1992, petitioner seasonably
filed its Notice of Appeal with the trial court.
On February 12, 1993, the trial court resolved in a
Special Order the Motion for Execution Pending Appeal in
favor of ISELCO-I, the dispositive portion of which reads:
12

WHEREFORE, finding the motion for execution pending appeal

to be meritorious as there are good and valid reasons in
support thereof, let a writ of execution of the decision of the
Court for the principal claim of P2,000,000.00 be issued upon
plaintiffs filing a bond in favor of defendant in the amount of
P1,817,742.8 to answer for damages that defendant may
suffer by reason of the writ if it is later on adjudge that plaintiff
was not entitled thereto.
SO ORDERED.

13

Aggrieved by such Special Order, petitioner filed a

Petition for Certiorari, Preliminary Injunction with
Temporary Restraining Order, with the Court of Appeals,
alleging grave abuse of discretion on the part of
respondent Judge in issuing the Special Order granting
execution pending appeal.
On April 19, 1993, the Court of Appeals issued a
Resolution dismissing the said petition. The motion for
reconsideration of petitioner was likewise denied for lack
of merit in a Resolution dated June 16, 1993.
Hence, this petition.
Petitioner assigns the following as errors, to wit:
14

15

SUBJECT INSURED PROPERTIES OF PRIVATE RESPONDENT IS

VALUED AT P36,052,061.15, AND NOT P2,000,000.00, HENCE
UNDERINSURED, HE BIASLY AND IMPROPERLY APPLIED
JUDICIAL NOTICE AND PIERCED THE SAID AMOUNT
OF P36,061,052.15 (SIC) BY DIVIDING IT INTO TWO AND
DECLARED THAT P2,000,000.00 PORTION THEREOF REFERS TO
THE VALUE OF THE INSURED PROPERTIES AND THE P34 M
COVERS OTHER PROPERTIES, TO MAKE IT APPEAR THAT THE
INSURED PROPERTIES WERE NOT UNDERINSUREDAND
THEREFORE PRIVATE RESPONDENT CAN CLAIM THE WHOLE
INSURANCE COVERAGE OF P2,000,000.00 WHICH IS CONTRARY
TO THE EVIDENCE AND THE LAW.
II
RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH
GRAVE
ABUSE
OF
DISCRETION IN
HASTILY
DENYING
PETITIONERS
MOTION
FOR
RECONSIDERATION
BY
DELIBERATELY IGNORING PETITIONERS REJOINDER TO PRIVATE
RESPONDENTS COMMENT ATTACHING THERETO (REJOINDER)
TWO SETS OF DOCUMENTSTO CORROBORATE THE JUDICIAL
ADMISSION OF PRIVATE RESPONDENT THAT ITS INSURED
PROPERTIES WERE VALUED AT P36,061,052.15 AND NOT
P2,000,000.00, HENCE, UNDERINSURED. THUS, THE APPEAL OF
PETITIONER IS NOT DILATORY.
III

RESPONDENT COURT OF APPEALS GRAVELY ERREDIN

AFFIRMING
THE
SPECIAL
ORDER
OF
RESPONDENT
JUDGE GRANTING EXECUTION PENDING APPEAL AGAINST
PETITIONER FOR AN ENORMOUS SUM OF P2,000,000.00
WITHOUT GOOD REASONS THEREFOR.

RESPONDENT COURT OF APPEALS ERRED AND ACTED WITH

GRAVE ABUSE OF DISCRETION OR IN EXCESS THEREOF
AMOUNTING TO LACK OF JURISDICTION IN AFFIRMING THE
ACTUATIONS OF RESPONDENT JUDGE WHO, KNOWING THAT
THE EVIDENCE BEFORE HIM CLEARLY PROVED THAT THE

At the outset, it must be pointed out that petitioner

adopted the wrong mode of appeal in bringing this case
before us. The proper remedy of a party aggrieved by a
decision of the Court of Appeals is a petition for review
under Rule 45 which is not similar to a petition for

16

certiorari under Rule 65 of the Rules of Court. This was

clearly addressed by this Court in Heirs of Marcelino
Pagobo vs. CA where we held that as provided in Rule 45
of the Rules of Court, decisions, final orders or resolutions
of the Court of Appeals in any case, i.e., regardless of the
nature of the action or proceedings involved, may be
appealed to us by filing a petition for review, which would
be but a continuation of the appellate process over the
original case. On the other hand, a special civil action
under Rule 65 is an independent action based on the
specific grounds therein provided and, as a general rule,
cannot be availed of as a substitute for the lost remedy of
an ordinary appeal, including that under Rule 45.
Accordingly, when a party adopts an improper remedy,
as in this case, his petition may be dismissed outright.
However, in the interest of substantial justice, the strict
application of procedural technicalities should not hinder
the speedy disposition of this case on the merits. Thus,
while the instant petition is one for certiorari under Rule
65 of the Rules of Court, the assigned errors are more
properly addressed in a petition for review under Rule 45.
First of all, it is at once apparent that the first two (2)
assignments of errors in this petition behoove this Court
to review the finding made by the appellate court that the
properties of ISELCOI were not underinsured. This we
cannot do for the simple reason that it would require us
to go into the merits of the decision rendered by
respondent Judge in Civil Case No. Br. 20-436, which
decision in the main case is now subject of a separate
appeal by petitioner to the Court of Appeals. Thus,
despite the parties insistent submission of the question
of underinsurance for our resolution in this petition, we
must reiterate the well-established rule that the merits of
the case should not be determined at this stage of the
proceedings, in advance of the main appeal taken by the
17

18

19

20

aggrieved party from the judgment rendered by

respondent court.
It is unfortunate that the Court of Appeals, in resolving
the petition for certiorari imputing grave abuse of
discretion to respondent Judge in granting execution
pending appeal per his said Special Order, dwelt on the
merits of the principal action, and held in part that:
21

On the central issue of whether there was underinsurance, the

respondent judge made the following findings which we sense
to be persuasive:
The third issue is whether or not the properties of the plaintiff are
underinsured. It is the contention of the defendant that because the
total value of the properties of the plaintiff is P36,000,000.00 but the
insurance taken is only P2,000,000.00, its properties are under
insured. The contention is not well taken. In the first place, while the
total value of the properties of the plaintiff is P36,000,000.00, not all
its properties were insured with the defendant. The only properties of
the plaintiff insured with the defendant are its distribution lines,
electric posts/poles, transformers and its accessories, towers and
fixtures installed and/or situated in the covered areas. Its buildings,
vehicles (which the court takes judicial notice of) and other
properties are not insured with defendant. The value of the properties
insured is only P2,282,765.00, more or less, as may be seen from the
summary of claims filed by the plaintiff dated November 21, 1989
and marked as Exhibit C. The properties insured are not under
insured. (Annex G of Petition) [Italics supplied]
22

The above-quoted obiter dictum of the Court of Appeals

with respect to the issue of underinsurance must be
disregarded as the ruling of the Court of Appeals cannot
be duly extended to expand the main thrust of its subject
Resolutions beyond their true import.
It is imperative that we allow the main appeal to take
its normal course. In the case before us, therefore, we
23

shall purposely limit ourselves to resolving only the

wisdom of the trial courts exercise of discretion in
ordering the execution pending appeal.
The assailed Special Order of respondent Judge
granting execution pending appeal reads as follows:
24

For resolution is a motion to execute the decision pending

appeal filed by the plaintiff, through counsel, based on the
following good reasons:
x x x that the withholding of payment by the defendant is fraudulent
and malicious in that it delayed payment and made business with the
money due to the plaintiff while the case was pending.
That since the happening of the event insured against in June
1989 and October 1989, the consumer-members which include the
municipalities of Alicia, Angadanan, Cabatuan, Cauayan, Cordon,
Santiago, Reina Mercedes, San Guillermo and San Agustin all in the
province of Isabela have suffered untold sufferings because while the
lines were repaired the repairs made on the damage on (sic)
transmission lines and backbone lines of the plaintiff were not
repaired as desired for lack of funds;
That the plaintiff need badly the amounts adjudged in the decision
for the use of said plaintiff in the repairs of its transmission lines,
electric posts, transformers and its accessories, towers and fixtures
within its area of coverage;
That to delay the payment of the claims of the plaintiff which is
valid will cause irreparable injury and sufferings to the consumermember who expect the best service from the plaintiff; xxx that the
plaintiff is willing to put up a bond to be fixed on the discretion of the
court to guarantee payment of damages to the defendant if the court
finds that it was wrongly issued.

In the joint affidavit of Rolando P. Garcia and Lyn M. Octubre,

OIC General Manager and Chief Management Internal Auditor,
respectively, of the plaintiff submitted in support of plaintiffs
motion, declared, among others, that:

1. 4.That the destruction had to be repaired immediately

and as the cooperative had no money at the time, the
cooperative had to borrow cash from private persons
and entities;
2. 5.That up to the present the indebtedness of the
cooperative aforecited is not fully paid to the present.
xxx
xxx
xxx
After a careful consideration of the case, the Court arrived
at the conclusion that the grounds relied upon by the plaintiff
constitute good and valid reasons for the execution of the
decision pending appeal. It must always be borne in mind that
the plaintiff is a cooperative of the people within the area of its
coverage. It is engaged in the business of retailing electricity
to its membersa commodity basic to the welfare and vital to
the industries of the people. Its business is thus impressed
with public interest.
To deliver electricity to the people, its electric lines, posts,
transmissions, transformers and other accessories must always
be maintained in good order and condition. This entails big
amount of money. Thus, plaintiff must have insured its
properties against the risk of their being damaged or
destroyed by typhoons so that it shall have sufficient funds for
their repair. But when the plaintiff went to the defendant to
demand payment of the proceeds of its insurance, it refused to
pay. It wanted to pay only partially.
Plaintiff had to repair its properties because it can not
escape its duties and responsibilities to the people. It borrowed
money to make the repairs which for lack of funds leave much
to be desired. Plaintiff needs the amount adjudged for the
repair of its transmission lines, electric posts, transformers and
accessories, towers and fixtures.
Posting of a bond by the plaintiff to secure payment of
damages to the defendant should the appellate court later on
adjudge that plaintiff was not entitled to the execution pending

appeal, is a good reason as held by the Supreme Court in

several cases (Lu vs. Valeriano,111 SCRA 87; Delos Reyes vs.
Capulong, 122 SCRA 631; Roxas vs. CA, 157 SCRA 370; City of
Manila vs. CA, 72 SCRA 98).
25

pending appeal, we have consistently held that such good

reason
must
constitute
superior
circumstances
demanding urgency which will outweigh the injury or
damage should the losing party secure a reversal of the
judgment. Beyond the guideline set by jurisprudence,
however, statute does not determine, enumerate, or give
examples of what may be considered good reasons to
justify execution pending appeal. What these good
reasons are must, therefore, necessarily be addressed to
the discretion of the court, and in the case of City of
Manila vs. Court of Appeals we said that:
30

Petitioner claims that the respondent Judge abused his

discretion in issuing a writ of execution pending appeal
despite the fact that its appeal is clearly not dilatory. It
likewise argued that since the evidence shows that
electricity was immediately restored in the affected
localities, the reasons posited by ISELCO-I are not the
good reasons contemplated by law for the extraordinary
grant of execution pending appeal.
We disagree.
As a general rule, the execution of a judgment should
not be had until and unless the judgment has become
final and executory,i.e., the period of appeal has lapsed
without an appeal having been taken, or appeal having
been taken, the appeal has been resolved and the
records of the case have been returned to the court of
origin, in which event, execution shall issue as a matter
of right. Execution pending appeal in accordance with
Section 2 of Rule 39 of the Rules of Court is, therefore,
the exception.
The requisites for the grant of a motion for execution
pending appeal are: (a) there must be a motion by the
prevailing party with notice to the adverse party; (b)
there must be a good reason for execution pending
appeal; and (c) the good reason must be stated in a
special order.
Being an exception to the general rule, the requisites of
execution pending appeal must, therefore, be strictly
construed. Thus, anent the requisite that there must be
good reason justifying the execution of the judgment
26

27

28

29

31

x x x If in the mind of the court, taking into consideration the

facts and circumstances surrounding the case, good reasons
exist, the exercise of the power to issue immediate execution
of the judgment cannot be considered as grave abuse of
discretion. Provided there are good reasons for execution
according to the judgment of the trial judge, such judgment
should generally not be interfered with, modified, controlled, or
inquired into by the appellate court; the latter should generally
not substitute its way of thinking for that of the trial court,
otherwise, the discretionary power given to the trial court
would have no meaning. The appellate court may, however,
interfere with that discretion lodged in the trial court only in
case of grave abuse or in case conditions have so far changed
since the issuance of the order as to necessitate the
intervention of the appellate court to protect the interests of
the parties against contingencies which were not or could have
not been contemplated by the trial judge at the time of the
issuance of the order.
32

We find that there is neither grave abuse of discretion on

the part of respondent Judge nor a change in
circumstances so as to warrant a setting aside of the
assailed Special Order granting execution pending
appeal.

Respondent judge exercised sound discretion in

granting execution pending appeal on the grounds that:
(1) ISELCO-I is a cooperative of the people within the area
of coverage that is engaged in the business of retailing
electricity to its membersa commodity basic to their
welfare and vital to the industries of the people; and (2)
to deliver electricity to the people, its electric lines, posts,
transmissions, transformers and other accessories must
always be maintained in good order and condition.
To restore electricity in the areas affected, ISELCO-I
had to borrow money from private persons and entities,
which money, however, was insufficient to repair all the
damage that had been caused to ISELCO-Is properties.
Hence, while it is true that ISELCO-I was able to
immediately repair its lines and restore electricity to the
areas affected by the typhoons, the damage to its
transmission lines and backbone lines was not repaired
due to lack of funds. But it is not the fact of ISELCO-Is
indebtedness that is propounded as the good reason for
execution pending appeal but the fact that, as correctly
pointed out by the trial court, to delay payment of the
claims of ISELCO-I would cause irreparable injury to the
consumers-members of the cooperative who expect the
best service from ISELCO-I.
Finally, it must be stressed here that respondent Judge
granted execution pending appeal based upon the
evidence of those factual circumstances mentioned
above. Furthermore, the Court of Appeals affirmed those
factual findings and respondent Judges conclusion that
the same constitute good reasons contemplated by law
for granting execution pending appeal.
It bears reiterating, therefore, that it is not the function
of this Court to analyze and weigh evidence all over again
unless there is a showing that the findings of the lower
court are totally devoid of support or are glaringly

erroneous as to constitute grave abuse of discretion. In

the same vein, the findings of fact of the Court of Appeals
supported by substantial evidence are conclusive and
binding on the parties and are not reviewable by this
Court, unless the case falls under any of the recognized
exceptions to the rule, and this, petitioner has failed to
prove.
WHEREFORE, the instant petition is hereby DENIED for
lack of merit, and the assailed Resolutions of the Court of
Appeals dated April 19, 1993 and June 16, 1993 are
AFFIRMED without prejudice to the resolution of the
appeal on merits now pending in the Court of Appeals;
and for that purpose, let the record of this case be
remanded to the Court of Appeals.
SO ORDERED.
Bellosillo(Chairman), Mendoza,Quisumbing and Bu
ena, JJ.,concur.
Petition denied, resolutions affirmed.
Notes.When a party adopts an improper remedy, his
petition may be dismissed outright; In the interest of
substantial justice, the strict application of procedural
technicalities should not hinder the speedy disposition of
a case on the merits. (Caraan vs. Court of Appeals, 289
SCRA 579[1998])
While the jurisdiction of the Supreme Court in a
petition for review on certiorari under Rule 45 of the
Revised Rules of Court is limited to reviewing errors of
law, not of fact, one exception is when the factual
findings complained of are devoid of support by the
evidence on record or the assailed judgment is based on
misappreciation of facts. (Metropolitan Bank and Trust
Company vs. Tonda,338 SCRA 254 [2000])
33

HERNANDO O. SIBULOcomplainant, vs. MURIEL S.

SAN JOSE, Sheriff III, MUNICIPAL TRIAL COURT IN
CITIES, Branch 1, Naga City, respondent.
Courts; Court
Personnel;Sheriffs; Judgments; Writs
of
Execution; It is mandatory for a sheriff to execute a judgment
and make a return on the writ of execution within the period
provided by the Rules of Court.It is mandatory for a sheriff to
execute a judgment and make a return on the writ of execution
within the period provided by the Rules of Court. Section 14,
Rule 39 of the Rules on Civil Procedure provides that the writ of
execution shall be returnable to the court immediately after
the judgment had been satisfied in part or in full. If the
judgment cannot be satisfied in full within thirty (30) days after
his receipt of the writ, the officer shall report to the court and
state the reason therefor and shall make a report to the court
every thirty (30) days until judgment is satisfied in full or its
effectivity expires.
Same; Same; Same; Same;Same; Although the writ of
execution is effective for five years from the date of judgment,
the sheriff tasked with its implementation must proceed with
reasonable dispatch in its execution and make a return
immediately.As observed by the OCA, the judgment in the
case remained unsatisfied even at the time the investigation
was conducted on November 26, 2002. This delay of four years
shows that respondent grossly neglected his duty. Although the
writ of execution is effective for five years from the date of the
judgment, the sheriff tasked with its implementation must
proceed with reasonable dispatch in its execution and make a
return immediately. If this is not done, he must make a report
to the court stating the reason for the failure of execution
within thirty (30) days after his receipt of the writ and make a
report every thirty (30) days thereafter until the judgment is
satisfied. Here, the respondent did not make the required
report.

Same; Same; Same; Gross Neglect of Duty; Gross neglect

of duty is a grave offense that carries with it the penalty of
dismissal.Gross neglect of duty is a grave offense that
carries with it the penalty of dismissal. However, dismissal
from the service is no longer possible in the present case
because the respondent sheriff had already been dismissed
from the service for absence without official leave (AWOL)
since August 1, 2002, pursuant to our Resolution, dated
February 24, 2003, in A.M. No. 03-1-20-MTCC.
Same; Same; Same; Same;Previous dismissal does not
render the instant case mootthe respondent could not avoid
administrative liability.Respondents previous dismissal does
not render this case moot. He could not avoid administrative
liability. Since dismissal would be redundant now, respondent
sheriff is hereby fined P5,000. His retirement and all other
benefits, except accrued leave credits, if any, are forfeited.
Further, he is disqualified from re-employment in any branch of
the government or its instrumentalities, including governmentowned and controlled corporations and financial institutions.

ADMINISTRATIVE MATTER in the Supreme Court. Gross

Neglect of Duty, Dishonesty and Acts Prejudicial to Public
Interest.
The facts are stated in the resolution of the Court.
RESOLUTION
QUISUMBING, J.:
On January 4, 2001, complainant Hernando O. Sibulo filed
with the Office of the Court Administrator a verified
complaint against respondent Muriel S. San Jose, Sheriff
III, Municipal Trial Court in Cities (MTCC), Branch 1, Naga
City, for gross neglect of duty, dishonesty and acts
prejudicial to public interest.
It appears that, based on the records of this
administrative matter, on October 19, 1998, Judge Julian

C. Ocampo III of MTCC, Branch 1, Naga City rendered a

decision in favor of complainant, who was the plaintiff
in Civil Case No. 10454, entitled Sibulo v. Federis and
Santiago for Damages. Because the defendants in that
case did not file an appeal, the decision became final and
executory. Thereafter, a writ of execution was issued on
December 17, 1998.
On November 3, 1999, more than a year after the
decision became final, complainant informed the judge
through a letter-complaint about the delay of respondent
sheriff in implementing the writ of execution. Acting on
the letter-complaint, the judge required respondent to
explain.
In his written explanation, respondent claimed that he
made a return on the writ a few days after February 4,
1999. However, upon verification of the records, no
sheriffs return was found in the records of the case. A
year later, on November 16, 2000, complainants father
followed-up the case. Complainant averred that
respondent had not until then implemented the writ of
execution and it was only after his follow-up that the
respondent acted on the writ. The next day, respondent
made a return dated November 17, 2000. Complainant
prayed that respondent be made to explain why the
decision was not executed despite payment of sheriffs
fees and repeated demands for the execution of the
judgment. Complainant asked that respondents irregular
and anomalous delay in the execution of the writ be
investigated.
In his Comment, respondent denied complainants
allegation that he failed to implement the writ with
reasonable dispatch. Respondent claimed that after he
received a copy of the writ on January 19, 1999, he
implemented the writ in the afternoon of that same day.
He claimed that service was made in the presence of the
1

Deputy Sheriff in the Office of the Clerk of Court of the

Regional Trial Court.
Respondent avers now that the writ was not
implemented because the defendant had no properties
that could be levied upon. He asserts that the prevailing
party also had the duty to assist him and should have
informed him of defendants properties that could be
levied upon. However, respondent adds, complainant did
not coordinate with him after November 3, 1999. When
he was informed that the complainants father followedup the case on November 16, 2000, he immediately
made a return on the writ on November 17, 2000 to notify
the complainant to look for and inform him of any
properties belonging to defendant. Moreover, considering
that the sheriffs report was filed through the Receiving or
Docket Clerk, respondent contends he should not be
blamed if his reports were misplaced.
Meantime, the Office of the Court Administrator (OCA)
received a letter, dated April 17, 2002, from Judge Jose P.
Nacional, recommending an investigation of respondents
failure to execute the writ. Judge Nacional said that upon
his assumption of duty as Acting Presiding Judge of MTCC,
Branch 1, Naga City, he required respondent to explain
his failure to perform his duties, and to submit a regular
return until the writs are fully implemented and
terminated. Respondent did not comply. Complainant
informed the judge that the case of Sibulo was among the
cases where the judgment remained unsatisfied.
Executive Judge Corazon A. Tordilla, to whom the case
was referred for investigation, reported that the sheriff
did not follow the procedure in Rule 39, Section 9(b) of
the Rules of Court in the service of the writ of execution
on Delia Santiago, and found herein respondent guilty of
gross neglect of duty. She likewise noted that as of
November 12, 2003, respondent had been dropped from
2

the roll for absence without official leave (AWOL) since

August 1, 2002.
On further evaluation, the OCA found respondent
indubitably guilty of gross neglect of duty. It
recommended that since respondent had been previously
dismissed from the service, he should now be considered
dismissed with forfeiture of all benefits and with prejudice
to re-employment in any branch or instrumentality of the
government, including government-owned or controlled
corporations.
We agree with the OCAs recommendation. It is
mandatory for a sheriff to execute a judgment and make
a return on the writ of execution within the period
provided by the Rules of Court. Section 14, Rule 39 of the
Rules on Civil Procedure provides that the writ of
execution shall be returnable to the court immediately
after the judgment had been satisfied in part or in full. If
the judgment cannot be satisfied in full within thirty (30)
days after his receipt of the writ, the officer shall report to
the court and state the reason therefor and shall make a
report to the court every thirty (30) days until judgment is
satisfied in full or its effectivity expires.
Records show that the writ of execution in Sibulos
case was issued on December 17, 1998 and the return on
the writ was made two years after, on November 17,
2000. Although respondent claimed that he made the
return a few days after February 4, 1999, no such return
was attached to the records of the case. In his
explanation before the Executive Judge, he claimed that
he received the writ on January 19, 1999 and served the
writ on the afternoon of that date. However, in his return
dated November 17, 2000, he alleged that he received
the writ on February 4, 1999. Such conflicting details cast
serious doubt on his claim that he indeed implemented
4

the writ. In addition, respondent promised to furnish the

investigating judge a copy of the writ but did not do so.
As observed by the OCA, the judgment in the case
remained unsatisfied even at the time the investigation
was conducted on November 26, 2002. This delay of four
years shows that respondent grossly neglected his duty.
Although the writ of execution is effective for five years
from the date of the judgment, the sheriff tasked with its
implementation must proceed with reasonable dispatch in
its execution and make a return immediately. If this is not
done, he must make a report to the court stating the
reason for the failure of execution within thirty (30) days
after his receipt of the writ and make a report every thirty
(30) days thereafter until the judgment is satisfied. Here,
the respondent did not make the required report.
Respondent explains that he did not find any personal
property of defendant that can be subject of execution.
But the stenographic notes of complainants testimony in
court reveal the contrary.
5

THE
COUR
T:

I found also in the records

as Annex G, the Sheriff
Report dated November
17, 2000 duly signed by
the respondent. It is
stated in said report, that
on February 4, 1999, the
respondent served upon
defendant operator Delia
G. Santiago, the writ of
execution No property
having been indicated by
you, that could be levied
upon, up to the date of
the report. (sic) Is this
true?

SIBUL
O:
Q:
A:

Q:
A:

Q:

A:

No, maam.
Why not?
Because Delia Santiago
also [has] a property like a
car.
What kind of car?
She has also a residential
house which is made of
concrete materials, that
one can easily see that
she has some personal
properties inside the
house. (sic)
How much really [is] the
amount you are claiming
as adjudged by the court?
More or less Ten Thousand
Pesos, your Honor. I would
like also to add that Mr.
Muriel San Jose informed
[me] that Ms. Delia
Santiago told him that she
was willing to [turn] over a
T.V. set in payment of her
account. Furthermore, he
also told me that if Mrs.
Delia Santiago would not
be willing to surrender the
T.V. set, she would
guarantee (sic) her
salary After I made
some follow-ups, [he] also
informed me that [she]

will just remit the money

to Mr. Renato San Juan,
who was the Clerk of
Court in the City Court of
Naga. I made several
follow-ups with Mr. San
Jose and Mr. San Juan, but
no money was remitted by
Mrs. Delia Santiago.
6

Clearly, respondent knew there were properties that

could be levied upon, when Delia Santiago offered to just
remit the money to the Clerk of Court of MTCC, Naga City,
for the satisfaction of the judgment. Respondent even
gave her one week grace period, and waited for her at
the office and when defendant did not deliver the
payment to the clerk of court, respondent should have
proceeded to levy on the personal properties of the
defendant in accordance with the rules.
To exculpate himself, respondent states that his failure
to make the
defendant remit the payment was due to his heavy
workload. We are unconvinced by respondents attempt
to excuse his failure. The investigating judge, in fact,
found that there were many other writs he had not
implemented.
Finally, we take judicial notice that respondent sheriff
was previously found guilty of negligence in the
performance of his duty and fined P1,000 for these other
failures, and he was sternly warned by the Court that a
similar conduct in the future would be dealt with more
severely.
Gross neglect of duty is a grave offense that carries
with it the penalty of dismissal. However, dismissal from
the service is no longer possible in the present case
7

because the respondent sheriff had already been

dismissed from the service for absence without official
leave (AWOL) since August 1, 2002, pursuant to our
Resolution, dated February 24, 2003, in A.M. No. 03-1-20MTCC.
Nonetheless, respondents previous dismissal does not
render this case moot. He could not avoid administrative
liability. Since dismissal would be redundant now,
respondent sheriff is hereby fined P5,000. His retirement
and all other benefits, except accrued leave credits, if
any, are forfeited. Further, he is disqualified from reemployment in any branch of the government or its
instrumentalities, including government-owned and
controlled corporations and financial institutions.
WHEREFORE, respondent MURIEL S. SAN JOSE, Sheriff
III, Municipal Trial Court in Cities, Branch 1, Naga City, is
found GUILTY of gross neglect in the performance of his
duties. In view of his previous dismissal, he is now FINED
P5,000.00 and all his benefits, except accrued leave
credits, if any, are forfeited, with prejudice to reemployment in any branch or instrumentality of the
government, including government-owned and controlled
corporations and financial institutions.
SO ORDERED.
Ynares-Santiago,Carpio and Azcuna, JJ., concur.
Davide, Jr. (C.J., Chairman), On Official Leave.
Muriel S. San Jose meted with P5,000.00 fine for gross
neglect in performance of duties.
Notes.The
pendency
of
the
motion
for
reconsideration and the re-raffle of the case to
anothersala does not justify the failure of the sheriff to
enforce the writ of execution issued by the court. (Teresa
T. Gonzales LaO & Co., Inc. vs. Hatab, 329 SCRA
646[2000])

Sheriffs play an important role in the administration of

justice, and they should always hold inviolate and
invigorate the tenet that a public office is a public trust.
The act of a sheriff of selling a vehicle while the same
was under his custody for safekeeping only constitutes
grave misconduct and dishonesty. (Ventura vs.
Concepcion, 346 SCRA 14 [2000])

PABLITO T. VILLARIN AND P.R. BUILDERS DEVELOPERS &

MANAGERS,
INC.,
petitioners, vs.
CORONADO
P.
MUNASQUE, respondent.
Judgments; Execution; Levy; A sheriff is required to first
demand of the judgment obligor the immediate payment of
the full amount stated in the writ of execution before a levy
can be made.The sheriff is required to first demand of the
judgment obligor the immediate payment of the full amount
stated in the writ of execution before a levy can be made. The
sheriff shall demand such payment either in cash, certified
bank check or any other mode of payment acceptable to the
judgment obligee. If the judgment obligor cannot pay by these
methods immediately or at once, he can exercise his option to
choose which of his properties can be levied upon. If he does
not exercise this option immediately or when he is absent or
cannot be located, he waives such right, and the sheriff can
now first levy his personal properties, if any, and then the real
properties if the personal properties are insufficient to answer
for the judgment. Subsection (a) of Section 9, Rule 39 was
taken from Section 15, Rule 39 of the 1964 Rules of Court
which provided that execution of money judgments is enforced
by levying on all the property, real and personal of every
name and nature whatsoever, and which may be disposed of
for value, of the judgment debtor not exempt from execution,
or on a sufficient amount of such property, if there be
sufficient, and selling the same, and paying to the judgment
creditor, or his attorney, so much of the proceeds as will satisfy
the judgment. The former rule directed the execution of a
money judgment against the property of the judgment debtor.
Same; Procedural Rules; The Court recognized that while it
is desirable that the Rules be conscientiously observed, in
meritorious cases they should be interpreted liberally to help
secure and not frustrate justice.In denying the petition, the
Court noted that the decision finding Seven Brothers liable to

Oriental Assurance had already become final and executory

and that entry of judgment had already issued. It also found
untenable Seven Brothers claim of improper levy, citing Torres
v. Cabling, 275 SCRA 329 (1997), where the Court held that a
sheriff is not required to give the judgment debtor some time
to raise cash [since] if time be given, the property may be
placed in danger of being lost or absconded. Based on the
evidence presented, Seven Brothers existing assets were
found to be insufficient to satisfy the final judgment against it,
and the sheriff was thus deemed justified in recognizing that
Seven Brothers was in no position to pay its obligation in cash
and in immediately levying on the vessels that would sail
beyond the reach of Philippine courts and law enforcers if the
levy was not made. In so ruling, the Court recognized that
while it is desirable that the Rules be conscientiously observed,
in meritorious cases they should be interpreted liberally to help
secure and not frustrate justice.
Execution; Levy; Since petitioners has also already agreed
to the levy on their real properties, it would be pointless to
require the deputy sheriff to demand immediate payment in
cash.In the case at bar, it is not disputed that Deputy Sheriff
Mendoza failed to first demand of petitioners the immediate
payment in cash of the full amount stated in the writ of
execution. However, it is also extant in the records that
petitioners never disputed the admissions of their counsel,
Atty. Salamero, that they had no funds to pay even a months
interest and that they agreed to the levy so long as the auction
sale would not be set earlier than 20 November 2002. The
admissions provide reasonable basis for the deputy sheriff to
forego prior demand on petitioners for payment in cash and
proceed to levy on the properties right away. Atty. Salamero, as
petitioners counsel and representative, is expected to know all
the matters related to the case, including the last stage of
execution and the state of financial affairs of her clients. Since
petitioners had also already agreed to the levy on their real

properties, it would be pointless to require the deputy sheriff to

demand immediate payment in cash. For the same reason, it
would be an empty exercise to expect the deputy sheriff to
first levy on their personal properties.
Pleadings and Practice; Where the subject of inquiry is the
contents of the photocopies submitted by petitioners, the
original documents themselves should be presented.The
allegation of overlevy was first raised in petitioners motion to
recall the notice of levy and to cancel the scheduled auction
sale of the levied properties. Under Section 3, Rule 15 of the
Rules of Court, a motion should state the relief sought to be
obtained and the grounds upon which it is based, and if
required by the Rules or necessary to prove the facts alleged
therein, must be accompanied by supporting affidavits and
other papers. In the motion to recall the notice of levy, the
claim of overlevy was not backed up by any supporting papers.
The only papers submitted to the trial court consisted of
attachments or annexes of petitioners reply to respondents
opposition, not of the motion to recall the notice of levy itself.
Even then, said papers consisted of merephotocopies of the
following: two appraisal reports by a property consultant firm,
a Maybank memorandum dated 17 June 2002 and a
safekeeping agreement which showed that the properties were
used by petitioners as collateral for loan transactions. Where
the subject of inquiry is the contents of the photocopies
submitted by petitioners, the original documents themselves
should be presented. The photocopies are secondary evidence
which are admissible only when the original documents are
unavailable, as when they had been lost or destroyed or
cannot otherwise be produced in court. As mere photocopies
and not originals, and where it had not been demonstrated
that the originals are no longer available, they are not
admissible to prove the true market value of the properties.
Same; The legal presumption that official duty has been
regularly performed applies especially when petitioners who

were duly represented during the auction sale neither objected

to the sale nor claimed immediately thereafter that the
properties were sold in bulk.As to petitioners allegation that
the Court of Appeals erred in not finding that the 44 parcels of
land were sold in bulk and not separately or individually as
required by law, the minutes of auction sale and certificate of
sale on execution would show otherwise. These official
documents indicate that the properties were sold individually.
We agree with the Court of Appeals that the legal presumption
that official duty has been regularly performed applies
especially when petitioners who were duly represented during
the auction sale neither objected to the sale nor claimed
immediately thereafter that the properties were sold in bulk.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Oben, Ventura & Associates for petitioner.
Jesus P. Disini for respondent.
TINGA,J.:
The Decision dated 31 March 2005 and Resolution
dated 11 August 2005 of the Court of Appeals 1 are
assailed in this petition for review under Rule 45.2
The facts as culled from the assailed decision and the
records follow.
This case stemmed from a Complaint 3 for collection of
sum of money filed on 10 July 2002 by respondent
Coronado P. Munasque against petitioners Pablito T.
Villarin and P.R. Builders Developers and Managers, Inc.,
and their co-defendant Intra Strata Assurance Corp. (Intra
Strata) before the Regional Trial Court (RTC) of Makati
City, Branch 58.
On 20 July 2002, before the answer could be filed, the
parties entered into a compromise agreement 4wherein

petitioners acknowledged their joint and solidary

obligation to respondent in the amount of P15 million,
with a monthly interest of P450,000.00 from 18 October
2001 until full payment, and promised to pay the whole
amount within ninety (90) days from the date of the said
agreement. To guarantee payment of the obligation, all
the real estate mortgages executed by petitioners in
favor of Intra Strata were assigned to respondent.
Consequently, Intra Strata was released from its
obligation to respondent and the complaint against it
dismissed.
On even date, the parties jointly filed before the RTC a
motion
for
the
approval
of
the
compromise
5
agreement. Judge Winlove M. Dumayas (Judge Dumayas),
pairing judge of the RTC, granted the motion on 2 August
2002.6
Petitioners managed to pay only P250,000.00 of their
total obligation. Thus, on 23 October 2002, respondent
filed a motion for execution.7
The motion was granted8and the writ of execution
issued on 29 October 2002.9The following day, 30 October
2002, deputy sheriff of Makati, Antonio Q. Mendoza
(Deputy Sheriff Mendoza), issued a notice of levy 10 and
had the same annotated at the back of thirty-four (34)
transfer certificates of title (TCTs) issued by the Register
of Deeds of Tanauan City in the name of petitioners. On
the same day, another notice of levy11 was issued against
all rights and interests of petitioners on a piece of land
covered by a tax declaration in petitioner Villarins name,
directing that the corresponding recording and annotation
be made in the books of the city assessor of Tagaytay
City. On 5 November 2002, still another notice of
levy12 with the same directive to the Register of Deeds of
Tanauan City, Batangas was issued against eleven (11)

pieces of property covered by TCTs issued in the name of

petitioners.
On 8 November 2002, Deputy Sheriff Mendoza issued
Notice of Deputy Sheriffs Sale on Execution13 relative to
the levied properties, caused its registration in the Office
of the City Assessor of Tagaytay and the Register of
Deeds of Tanauan City, and had it posted for twenty days
in three public places each in the cities of Tanauan,
Tagaytay and Makati. After the raffle was conducted by
the clerk of court (ex officiodeputy sheriff) of the RTC of
Makati City, the notice of sale on execution was published
in a newspaper of national circulation on 20 and 27
November 2002.14
On 14 November 2002, the law firm of Oben Ventura
Abola entered its appearance as collaborating counsel
with petitioners counsel of record, Atty. Jufraida F.
Salamero (Atty. Salamero).15 The firm sentvia registered
mail to respondents counsel and Deputy Sheriff Mendoza
a letter16 dated 13 November 2002, complaining of
procedural lapses in the enforcement of the writ of
execution. The firm claimed that the deputy sheriff did
not comply with Section 9, Rule 39 of the 1997 Rules of
Civil Procedure which, according to it, requires first a
personal demand for payment of the full amount of the
obligation before levy on the properties could be made;
that when levy was made, petitioners were not given the
option to choose what property should be levied; and that
levy should have been made first on petitioners personal
properties. Petitioners then identified eight (8) parcels of
land registered with the Register of Deeds of Tanauan City
which they claimed should be the subject of levy since
the combined value of the said properties was sufficient
to cover the P15 million claim. On that basis, they
requested that the appropriate correction be made in the
notice of levy.

On 19 November 2002, petitioners filed a motion to

recall the notice of levy and cancel the scheduled deputy
sheriffs sale, alleging the same grounds raised in the
letter of 13 November 2002.17
Respondent opposed the motion, contending that the
day before the levy, petitioners counsel, Atty. Salamero,
informed respondents counsel that petitioners did not
have the money to pay even one months interest at the
time. It was also averred that Atty. Salamero also agreed
to the immediate levy of the real properties of petitioners
provided that the auction sale be scheduled earlier than
20 November 2002 because by then, according to her,
petitioners shall have already had the funds needed to
pay their obligation. Petitioners accountant, Florita B.
Santos (Santos), allegedly made similar representations
to respondent. Respondent also alleged that petitioners
specification of the 8 parcels of land to be levied upon
constituted a waiver and/or confirmation of their previous
waiver of the need to require the sheriff to first personally
demand full payment of the judgment debt or levy on
their personal properties.18
On 13 December 2002, the RTC reset the scheduled
auction sale from 16 December 2002 to 16 January
2003.19
On 7 January 2003, the RTC issued an Order 20denying
for lack of merit petitioners motion to recall the levy and
to cancel the scheduled sale on execution. Thus, on 16
January 2003, Deputy Sheriff Mendoza conducted an
auction sale of the levied properties at the main entrance
lobby of the Makati City Hall. The minutes of auction
sale21would show that counsels for both parties, who had
affixed their signatures therein, were present at the sale
and that only respondents representative participated in
the bidding. As found by the Court of Appeals, the said
minutes would also show that all the real properties had

been sold one after another with separate price for each
bid and that the individual bid prices for the fourty-four
(44) lots totaled P19,546,000.00. Respondent paid the
deputy sheriffs fees and thereafter was issued a
certificate of sale on execution.
On 30 January 2003, petitioners filed an omnibus
motion to reconsider the Order dated 7 January 2003; to
declare null and void and recall the Notice of Levy dated
30 October 2002, the Notice of Deputy Sheriffs Sale on
Execution dated 8 November 2002, and the auction sale
proceedings held on 16 January 2003; and to inhibit the
presiding judge.22 Petitioners alleged that the 7 January
2003 Order did not have any factual or legal basis, and
that they had lost faith in the presiding judge whose acts
were tainted with irregularity and malice.
On 20 February 2003, Judge Dumayas inhibited himself
from the case without resolving petitioners omnibus
motion. The case was re-raffled to Branch 148, presided
by Judge Oscar B. Pimentel (Judge Pimentel).
On 12 June 2003, Judge Pimentel issued an
Order23declaring null and void the deputy sheriffs sale on
execution of petitioners real properties and setting aside
the 7 January 2003 Order which denied petitioners
motion to recall the notice of levy. The dispositive portion
of the order reads:
WHEREFORE, premises considered, the Omnibus Motion is
hereby GRANTED, hence, the Order dated 7 January 2003 is
hereby set aside, and the notice of levy dated 30 October
2002, notice of Deputy Sheriffs sale on execution dated 8
November 2002 and the auction sale proceedings on 16
January 2003 are hereby declared null and void.
SO ORDERED.

24

On 3 July 2003, respondent filed a motion for

reconsideration of the Order of 12 June 2003, but this was
denied in the RTCs Order25 dated 25 August 2003.
Respondent thus appealed to the Court of Appeals
which, on 31 March 2005, ruled favorably to respondent:26
WHEREFORE, the assailed Orders dated 12 June 2003 and
[25 August 2003] of Judge Pimentel are REVERSED and SET
ASIDE. The Order dated 7 January 2003 of Judge Dumayas is
AFFIRMED and REINSTATED, and the validity of the auction sale
conducted by Deputy Sheriff Mendoza on 16 January 2003,
UPHELD.
SO ORDERED.

27

The Court of Appeals noted that in the RTCs Order of 7

January 2003, some pertinent facts were not denied or
disputed by petitioners, namely, that Atty. Salamero and
Santos admitted to respondents counsel that petitioners
had no sufficient funds to pay even one months interest,
and that petitioners agreed that the levy may proceed as
long as the auction sale would not be scheduled earlier
than 20 November 2002. The Court of Appeals also held
that all the alleged procedural defects committed by
Deputy Sheriff Mendoza had been corrected when
petitioners wrote the letter dated 13 November 2002, 28 as
follows:
In violation of the above requirements, no demand for the
immediate payment for the full amount of the obligation was
made upon the [petitioners] by the [Deputy Sheriff] concerned
prior to the issuance of the levy.
As a consequence, [petitioners] had been thereby
effectively and unduly deprived of the opportunity to exercise
his option or right under the Writ to immediately choose
which properties may be levied upon in the event he fails to
pay the judgment debt upon such demand.

As a further consequence, levy has been indiscriminately

and arbitrarily made on properties of [petitioners] whose value
is well in excess of [respondents] claim.
We note that the aforesaid Notice of Levy was issued with
precipitate haste on 30 October 2002, just a day after the
issuance of the Writ of Execution on 29 October 2002, barring
sufficient opportunity for a demand for payment to be made
upon [petitioners] nor for any opportunity to exercise
[petitioners] right to choose which properties may be levied
upon, indicative of a premeditated plan of over levying on
[petitioners] properties.
Notwithstanding the above, [petitioners] hereby exercise
their right to choose which properties may be levied upon in
satisfaction of their aforesaid obligation pursuant to the Writ of
Execution issued by Honorable Winlove M. Dumayas of the
[RTC] of Makati, Branch 58, to wit:

Real
Property
TCT No. T89829
TCT No. T93840
TCT No. T93843
TCT No. T93845
TCT No. T93847
TCT No. T93848
TCT No. T93849
TCT No. T93850

Area
47,241
meters
4,184
meters
4,408
meters
4,406
meters
4,406
meters
4,406
meters
4,406
meters
4,406
meters29

sq.
sq.
sq.
sq.
sq.
sq.
sq.
sq.

The Court of Appeals found that the foregoing acts

amounted to petitioners exercise of their right to
immediately choose which property or part thereof may
be levied upon sufficient to satisfy the judgment and a
waiver of their right to require the officer to first levy on
their personal properties. The appellate court opined that
it would be an exercise in futility to require the officer to
first make a personal demand when the judgment debtors
(petitioners) had already given the go-signal to proceed
with the levy of real properties. It noted that waiver of
personal demand for immediate payment is allowed by
Article 6 of the New Civil Code and such waivers and
automatic correction of the procedural defects thus
rendered moot the challenge against the validity of the
levy.30
The appellate court ruled further that petitioners 44
parcels of land were sold separately as required by law
and not in bulk. It found erroneous the RTCs conclusion
that the sale was made in bulk since nowhere was it
stated in the deputy sheriffs report that the sale of all the
parcels of land was done en masse, and the minutes of
the auction sale, prepared by the deputy sheriff and
signed by the representatives of both parties, clearly
indicate the individual description and TCT numbers of
the properties sold, the individual bid price for each
parcel of land, and the total bid price for all 44 parcels.
The certificate of sale on execution dated 16 January
2003 also specifies the TCT number, the technical
description, and selling price of each parcel of land sold.
Thus, bearing in mind the legal presumption of regular
performance of official duty and the fact that the parties
never made any objection during the auction sale or
immediately thereafter, the Court of Appeals ruled that
the properties were sold separately.31

In the present petition, petitioners contend that Deputy

Sheriff Mendoza failed to comply with the provisions of
Section 9, Rule 39 of the Rules of Court in implementing
the writ of execution. In levying on the 44 parcels of land,
he allegedly failed to (a) first make a personal demand on
petitioners for the immediate payment of the full amount
stated in the writ of execution and all lawful fees and (b)
give petitioners the option to immediately choose which
property or part thereof sufficient to satisfy the judgment
may be levied upon.32 They argue that the admissions
made by Atty. Salamero and Santos do not amount to a
waiver of their right to prior demand for payment of the
full amount of the judgment, noting that Deputy Sheriff
Mendoza should have made the demand for payment on
petitioners themselves in order to verify the admissions
made by said persons.33
Petitioners add that the letter of 13 November 2002
also does not constitute a waiver or an automatic
correction of the procedural defects in the execution of
the writ since petitioners wrote the letter precisely to
exercise their right to choose the properties to be levied
upon. They merely sought to save whatever rights they
still had, they explain.34
Petitioners also question the Court of Appeals finding
that the 44 parcels of land were sold separately as
required by law, on the ground that it has no factual or
evidentiary basis. The minutes of the auction sale on
which the Court of Appeals based its finding do not even
contain the individual description of the properties sold
but only an enumeration of the titles covering each
property, with the bid price for each parcel of land left
blank but later filled in by handwriting only, indicating
that the 44 parcels were sold in bulk and not separately.35
Finally, petitioners allege that the Court of Appeals
erred in disregarding the documents they presented

which show the fair market value of the properties levied

by Deputy Sheriff Mendoza. The documents supposedly
show that the fair market value of the properties levied
upon is P1,187,212,000.00 or far greater than the
judgment debt of P15 million. Thus, they claim that an
overlevy was perpetrated by failure to comply with the
provisions of Section 9, Rule 39.36
In his comment, respondent agrees with the Court of
Appeals that in assenting, through their counsel, to the
auction sale scheduled after 20 November 2002,
petitioners waived the requirement of demand for
immediate payment, and that through their letter of 13
November 2002, they indicated their choice of the
specific properties to be levied upon and this also
unwittingly cured the procedural lapses in the
enforcement of the writ.37
As to petitioners allegations that the levied properties
were sold in bulk, not individually, and that the appellate
court disregarded evidence proving the market value of
the properties levied upon, respondent asserts that such
allegations are primarily questions of fact which are
improper in such a petition as the present one; besides,
official documents such as the minutes of auction sale
and the certificate of sale on execution, show that the
properties were sold individually. Moreover, the market
value of the properties was indicated by the RTC in the
Order of 7 January 2003, based on tax declarations he
submitted for evaluation, respondent adds.
On 25 January 2006, petitioners filed their
Reply38 essentially reiterating the arguments in their
petition.
The validity of both the levy made by Deputy Sheriff
Mendoza on petitioners 44 parcels of land and the
subsequent auction sale proceedings is put in question in
this case. The main issue may be couched as follows:

whether the failure of the deputy sheriff to first demand

of the judgment obligor payment of the judgment debt
before levying the judgment obligors real properties
without allowing him to exercise his option to choose
which of his properties may be levied upon, and without
first levying on his personal properties, constitute a fatal
procedural defect resulting in the nullity of the levy and
the subsequent execution sale. The other issue is
whether the Court of Appeals committed grave abuse of
discretion in failing to consider petitioners evidence on
the fair market value of the levied properties.
The petition should be denied.
Section 9, Rule 39 of the Rules of Court provides the
procedure in the enforcement of a money judgment. It
reads:
SEC.9.Execution of judgments for money, how enforced.
(a) Immediate payment on demand.The officer shall
enforce an execution of a judgment for money by demanding
from the judgment obligor the immediate payment of the full
amount stated in the writ of execution and all lawful fees. The
judgment obligor shall pay in cash, certified bank check
payable to the judgment obligee, or any other form of payment
acceptable to the latter, the amount of the judgment debt
under proper receipt directly to the judgment obligee or his
authorized representative if present at the time of payment.
The lawful fees shall be handed under proper receipt to the
executing sheriff who shall turn over the said amount within
the same day to the clerk of court of the court that issued the
writ.
xxxx
(b)Satisfaction by levy.If the judgment obligor cannot
pay all or part of the obligation in cash, certified bank check or
other mode of payment acceptable to the judgment obligee,
the officer shall levy upon the properties of the judgment
obligor of every kind and nature whatsoever which may be

disposed of for value and not otherwise exempt from execution

giving the latter the option to immediately choose which
property or part thereof may be levied upon, sufficient to
satisfy the judgment. If the judgment obligor does not exercise
the option, the officer shall first levy on the personal
properties, if any, and then on the real properties if the
personal properties are insufficient to answer for the judgment.
The sheriff shall sell only a sufficient portion of the personal
or real property of the judgment obligor which has been levied
upon.
When there is more property of the judgment obligor than is
sufficient to satisfy the judgment and lawful fees, he must sell
only so much of the personal or real property as is sufficient to
satisfy the judgment and lawful fees.
Real property, stocks, shares, debts, credits, and other
personal property, or any interest in either real or personal
property, may levied upon in like manner and with like effect
as under a writ of attachment.
x x x x

Based on the foregoing, the sheriff is required to first

demand of the judgment obligor the immediate payment
of the full amount stated in the writ of execution before a
levy can be made. The sheriff shall demand such
payment either in cash, certified bank check or any other
mode of payment acceptable to the judgment obligee. If
the judgment obligor cannot pay by these methods
immediately or at once, he can exercise his option to
choose which of his properties can be levied upon. If he
does not exercise this option immediately or when he is
absent or cannot be located, he waives such right, and
the sheriff can now first levy his personal properties, if
any, and then the real properties if the personal
properties are insufficient to answer for the judgment.39

Subsection (a) of Section 9, Rule 39 was taken from

Section 15, Rule 39 of the 1964 Rules of Court which
provided that execution of money judgments is enforced
by levying on all the property, real and personal of every
name and nature whatsoever, and which may be
disposed of for value, of the judgment debtor not exempt
from execution, or on a sufficient amount of such
property, if there be sufficient, and selling the same, and
paying to the judgment creditor, or his attorney, so much
of the proceeds as will satisfy the judgment. The former
rule directed the execution of a money judgment against
the property of the judgment debtor.40
The present rule now requires the sheriff to first make
a demand for payment, and it prescribes the procedure
for and the manner of payment as well as the immediate
turnover of the payment by the sheriff to the clerk of
court. Levy as a mode of satisfying the judgment may be
done only if the judgment obligor cannot pay all or part of
the obligation in cash, certified bank check, or other
mode of payment acceptable to the judgment obligee.41
The issue of improper levy was raised in Seven
Brothers Shipping Corp. v. Oriental Assurance Corp.42In
that case, Seven Brothers was ordered to pay Oriental
Assurance P8 million plus interest at the legal rate from
the date of filing of the complaint until full payment.
When the sheriff enforced the writ of execution by levying
on the vessels of the shipping company, it moved to
quash the writ and to lift the levy. The RTC granted the
motion. Oriental Assurance assailed the RTC decision
through a petition forcertiorari which the Court of Appeals
granted. Thus, the writ of execution and the levy on the
vessels were reinstated. Thereafter, Seven Brothers filed
with this Court a petition for review contending, among
others, that the levy was improper since the sheriff had

not demanded payment of the judgment debt in cash

before levying on its vessels.
In denying the petition, the Court noted that the
decision finding Seven Brothers liable to Oriental
Assurance had already become final and executory and
that entry of judgment had already issued. It also found
untenable Seven Brothers claim of improper levy,
citing Torres v. Cabling43 where the Court held that a
sheriff is not required to give the judgment debtor some
time to raise cash [since] if time be given, the property
may be placed in danger of being lost or absconded.
Based on the evidence presented, Seven Brothers
existing assets were found to be insufficient to satisfy the
final judgment against it, and the sheriff was thus
deemed justified in recognizing that Seven Brothers was
in no position to pay its obligation in cash and in
immediately levying on the vessels that would sail
beyond the reach of Philippine courts and law enforcers if
the levy was not made. In so ruling, the Court recognized
that while it is desirable that the Rules be conscientiously
observed, in meritorious cases they should be interpreted
liberally to help secure and not frustrate justice.44
In the case at bar, it is not disputed that Deputy
Sheriff Mendoza failed to first demand of petitioners the
immediate payment in cash of the full amount stated in
the writ of execution. However, it is also extant in the
records that petitioners never disputed the admissions of
their counsel, Atty. Salamero, that they had no funds to
pay even a months interest and that they agreed to the
levy so long as the auction sale would not be set earlier
than 20 November 2002. The admissions provide
reasonable basis for the deputy sheriff to forego prior
demand on petitioners for payment in cash and proceed
to levy on the properties right away. Atty. Salamero, as
petitioners counsel and representative, is expected to

know all the matters related to the case, including the

last stage of execution and the state of financial affairs of
her clients. Since petitioners had also already agreed to
the levy on their real properties, it would be pointless to
require the deputy sheriff to demand immediate payment
in cash. For the same reason, it would be an empty
exercise to expect the deputy sheriff to first levy on their
personal properties.
Furthermore, while petitioners, in their 13 November
2002 letter, complained of procedural defects in the
enforcement of the writ, they at the same time also
actually exercise[d] their right to choose which
properties may be levied upon in satisfaction of their
aforesaid obligation.45 It should be noted that nowhere in
the letter did they offer payment of their obligation in
cash. They did not even allege any willingness and ability
to do so. They also did not offer personal properties that
may be subject of levy. What they offered were 8 parcels
of land, the value of which, so they alleged, would satisfy
the obligation. With the offer, petitioners then requested
that the appropriate corrections in the notice of levy be
made, presumably to limit the levy to said parcels of land
and to effect cancellation of the levy on the remaining
parcels. The request is evidenced by petitioners
subsequent motion to recall the notice of levy, specifically
seeking that the notice of levy of Deputy Sheriff Mendoza
be cancelled and a new one issued effecting a levy only
on the aforementioned 8 parcels of land.
By such acts, petitioners may be said to have
overlooked the procedural lapses, acceded to the
execution by levy, and effectively exercised their right to
choose which of their properties may be levied on. That
the 13 November 2002 letter is an exercise of this right is
shown by this explicit averment in the motion to recall
the notice of levy, thus:

5.To protect and preserve their rights under the

circumstances, on 13 November 2002, [petitioners] wrote a
letter x x x formally exercising their right to choose which
properties may be levied upon in accordance with the terms of
the Writ of Execution issued by this Honorable Court. In the
said letter, [petitioners] had identified a pool of assets,
consisting of real properties, from which pool of assets, levy
may be made upon such properties whose combined total
aggregate value would satisfactorily cover and satisfy
plaintiffs principal claim of Fifteen Million Pesos x x
x. [Emphasis supplied]
46

We thus conclude that Deputy Sheriff Mendozas failure

to demand immediate payment in cash did not nullify the
levy on petitioners real properties.
We now go to the question of overlevy of the
properties.
The 8 parcels of land indicated in the 13 November
2002 letter are actually among the 44 parcels of land
levied upon by Deputy Sheriff Mendoza. Petitioners claim
that these 8 parcels of land already had a total fair
market value of P155,726,000.00, enough to satisfy their
judgment debt, and that there was an overlevy when all
44 parcels of land were levied upon. Related to the claim
of overlevy is the ascribed grave abuse of discretion 47on
the part of the Court of Appeals for its failure to consider
the evidence presented by petitioners showing the fair
market value of the levied properties.
The question of whether there was indeed an overlevy
of properties is one that is essentially factual in nature, as
it goes into the determination of the fair market value of
the properties levied upon and the consideration of the
amount of real property levied. An exercise like this does
not involve the application of discretion as it invites
rather an evaluation of the evidentiary record which is not
proper in a petition for review oncertiorari. Matters of

proof and evidence are beyond the power of this Court to

review under a Rule 45 petition, except in the presence of
some meritorious circumstances,48 none of which is
availing in this case.
The allegation of overlevy was first raised in
petitioners motion to recall the notice of levy and to
cancel the scheduled auction sale of the levied
properties. Under Section 3, Rule 15 of the Rules of Court,
a motion should state the relief sought to be obtained
and the grounds upon which it is based, and if required by
the Rules or necessary to prove the facts alleged therein,
must be accompanied by supporting affidavits and other
papers. In the motion to recall the notice of levy, the
claim of overlevy was not backed up by any supporting
papers. The only papers submitted to the trial court
consisted of attachments or annexes of petitioners reply
to respondents opposition, not of the motion to recall the
notice of levy itself. Even then, said papers consisted of
mere photocopies of the following: two appraisal reports
by a property consultant firm, 49 a Maybank memorandum
dated 17 June 2002 and a safekeeping agreement which
showed that the properties were used by petitioners as
collateral for loan transactions. 50 Where the subject of
inquiry is the contents of the photocopies submitted by
petitioners, the original documents themselves should be
presented.51 The photocopies are secondary evidence
which are admissible only when the original documents
are unavailable, as when they had been lost or destroyed
or cannot otherwise be produced in court. 52 As mere
photocopies and not originals, and where it had not been
demonstrated that the originals are no longer available,
they are not admissible to prove the true market value of
the properties.
The appraisal reports valued the properties at the total
amount of P912,428,000.00. However, the appraisal

reports do not clearly identify, through lot numbers and

TCT numbers, the properties they cover; instead, the
properties are broadly described as land [area in square
meters]
located
at
Barangay
Quiling,
Talisay,
53
Batangas. Thus, the general conclusion that the
properties covered by the appraisal reports include the
subject properties cannot really be determined from the
appraisal reports alone. In fact, in their reply to
respondents opposition, petitioners clarified that the first
appraisal report dated 21 February 2001 covers a piece of
property that is actually not among the properties levied
upon by the deputy sheriff and sold at public auction.54
The first appraisal report indicates that the report was
based on, among others, a photocopy of the TCT of the
property, but the TCT was not appended to the report
submitted to the court for evaluation. What was instead
attached is the Maybank memorandum which supposedly
evidenced approval of an application for a domestic letter
of credit secured with a P47 million real estate mortgage
over the property covered by TCT No. T-89827. Petitioners
claim that the first appraisal report described and
appraised the property covered by TCT No. T-89827. 55 It
should nonetheless be noted that the property covered
by TCT No. T-89827 is not one of the properties levied
upon by the deputy sheriff or sold at the auction sale.
The valuation in the first appraisal report is confirmed
by the second appraisal report dated 31 May 2002,
petitioners claim, since the second report also covers
properties located in the same area. However, like the
other appraisal report, the identification of the particular
properties covered by the second appraisal report cannot
be determined. The second report stated that the
valuation is premised on the assumption that the
property as pinpointed to the appraisers is the one
described in the titles and plans furnished them.

However, no such titles or plans are attached to the

report which even acknowledged that the assumptions
arrived at were made in the absence of an updated
relocation survey and cadastral map from the assessors
office of Talisay, Batangas.56
Furthermore, it was not demonstrated in either
appraisal report that the assumptions on which the
valuations were premisedi.e., that the barangay road
fronting the properties would be developed all the way up
to Tagaytay-Calamba Road leading to the Palace in the
Sky, and that the Tagaytay Highlands Drive actually
bounds the property as claimed by Villarinwere
substantiated.
The safekeeping agreement dated 6 March 2001
provided that 16 of petitioner Villarins properties in
Barangay Quiling, Talisay, Batangas, which are among
those levied upon by the deputy sheriff, would be used as
security and collateral for the loan of US$75 million
obtained from an international financing corporation. The
16 properties supposedly have an appraised value of
P745,615,000.00, equivalent to twenty percent (20%) of
the loan value, or US$15 million. However, aside from the
declared values in the document, no other supporting
document to establish the fair market value of these
properties was given. It is not even certain if the loan
agreement subject of the safekeeping agreement pushed
through.
Moreover, the records show that the original loan of
P15 million was secured by a real estate mortgage 57over a
47,241-square meter parcel of land and improvements
thereon in Barangay San Jose, Tagaytay City covered by
TCT No. T-89829, as well as a guarantee payment bond58of
P15 million issued by Intra Strata and a mortgage
redemption insurance for P16 million. 59 For one thing, the
real estate mortgage securing the P15 million loan does

not indicate the value of the property mortgaged. And for

another, it appears that the parties themselves did not
deem the mortgage as sufficient security. There were
additional securities provided by the guarantee payment
bond and mortgage redemption insurance.
The records also show that in the compromise
agreement subsequently entered into by petitioners,
respondent and Intra Strata, the indebtedness of P15
million plus all interests due was secured by all the
mortgages executed over petitioners real properties in
favor of Intra Strata.60 Said real properties allegedly refer
to the 8 parcels of land indicated in the 13 November
2002 letter.61However, nothing in the record corroborates
this claim. There is no proof that the properties referred
to in paragraph (c) of the compromise agreement are the
same 8 parcels of land mentioned in the letter. Proof of
these mortgages and other relevant documents was not
even offered.
The burden is on petitioners to prove their claim of
overlevy but the evidence they presented is woefully
insufficient. Consequently, they failed to overcome the
burden of proof.
As to petitioners allegation that the Court of Appeals
erred in not finding that the 44 parcels of land were sold
in bulk and not separately or individually as required by
law, the minutes of auction sale and certificate of sale on
execution would show otherwise. These official
documents indicate that the properties were sold
individually. We agree with the Court of Appeals that the
legal presumption that official duty has been regularly
performed applies especially when petitioners who were
duly represented during the auction sale neither objected
to the sale nor claimed immediately thereafter that the
properties were sold in bulk.

To stress anew, following the review yardstick in a Rule

45 petition which is reversible error, the Court of Appeals
emerges faultless in disregarding petitioners evidence.
Even if the measure of review is grave abuse of
discretion as petitioners unknowingly insist, the
appellate court should be sustained still.
WHEREFORE, in view of the foregoing, the petition is
DENIED. The Decision dated 31 March 2005 and
Resolution dated 11 August 2005 of the Court of Appeals
are AFFIRMED. Costs against petitioners.

MANUEL V. MENDOZA, complainant, vs. ANGEL L.

DORONI, Sheriff IV, Regional Trial Court, Branch
77, Quezon City, respondent.
Courts; Court
Personnel;Sheriffs; Ejectment; Writs
of
Execution; Enforcement in ejectment cases requires that the
sheriff must give notice of such writ and demand from the
defendant to vacate the property within three days; When a
decision in ejectment case states that it is immediately
executory, it does not mean dispensing with required notice
or three-day removal period.Well-settled is the rule that the
sheriffs duty in the execution of a writ issued by a court is
purely ministerial. The sheriff must comply with the Rules of
Court in executing a writ. Any act deviating from the procedure
laid down in the Rules of Court is a misconduct and warrants
disciplinary action. In this case, Section 10(c) of Rule 39
prescribes the procedure in the implementation of the writ.
Section 10(c) expressly provides: Sec. 10(c). Delivery or
restitution of real property.The officer shall demand of the
person against whom the judgment for the delivery or
restitution of real property is rendered and all persons claiming
rights under him to peaceably vacate the property within
three (3) working days, and restore possession thereof to
the judgment obligee; otherwise, the officer shall oust all such
persons therefrom with the assistance, if necessary, of
appropriate peace officers, and employing such means as may
be reasonably necessary to retake possession, and place the
judgment obligee in possession of such property. Any costs,
damages, rents or profits awarded by the judgment shall be
satisfied in the same manner as a judgment for money.
(Emphasis supplied) Based on this provision, enforcement in
ejectment cases requires that the sheriff must give notice of
such writ and demand from defendant to vacate the property
within three days. Only after such period can the sheriff
enforce the writ by the bodily removal of defendant and his

personal belongings. Immediacy of execution does not mean

instant execution. When a decision in ejectment cases states
that it is immediately executory, it does not mean dispensing
with the required notice or three-day removal period. A sheriff
who enforces the writ without the required notice or before the
expiry of the three-day period runs afoul with Section 10(c) of
Rule 39.
Same; Same; Same; Same;Same; The law frowns upon
arbitrariness and oppressive conduct in the execution of an
otherwise legitimate act.Respondent, having been in the
government service for almost fifteen years, should have
known by heart this rule. The notice requirement is based on
the rudiments of justice and fair play. The law frowns upon
arbitrariness and oppressive conduct in the execution of an
otherwise legitimate act. It is evident from the records that
respondent failed to serve a prior notice to vacate. On the very
same day the writ was handed to him, respondent immediately
went to the property to oust complainants employees.
Respondent did not give any notice to the occupants to vacate
peaceably the property.
Same; Same; Same; In the execution of judgments for
money, if the judgment obligee or his authorized
representative is not present to receive the payment, the
judgment obligor shall deliver the aforesaid payment to the
executing sheriff who shall turn over all the amounts coming
into his possession within the same day to the clerk of court of
the court that issued the writ.Respondents excuse in not
collecting the P60,000 from defendants is that he could not
locate the owners of the destroyed structures. This is
untenable. Rule 39 provides for a remedy in case the judgment
creditor could not be located. Section 9 of Rule 39 states:
Section 9. Execution of judgments for money, how enforced.x
x x. If the judgment obligee or his authorized representative is
not present to receive payment, the judgment obligor shall
deliver the aforesaid payment to the executing sheriff. The

latter shall turn over all the amounts coming into his
possession within the same day to the clerk of court of the
court that issued the writ, or if the same is not practicable,
deposit said amounts to a fiduciary account in the nearest
government depository bank of the Regional Trial Court of the
locality. x x x.
Same; Same; Same; A decision left unexecuted because of
a sheriffs inefficiency, negligence, misconduct or ignorance
negates all the painstaking effort exerted by the entire
judiciary to the litigants.Execution puts an end to litigation,
giving justice to the prevailing party. A decision left unexecuted
because of the sheriffs inefficiency, negligence, misconduct or
ignorance negates all the painstaking effort exerted by the
entire judiciary to render justice to litigants. A sheriff who fails
to execute, or who selectively executes, a final judgment
commits not only a great disservice to the entire judiciary, he
also diminishes the peoples faith in the judiciary.

ADMINISTRATIVE MATTER in the Supreme Court.

Misconduct and Gross Negligence.
The facts are stated in the opinion of the Court.
CARPIO, J.:
The Case
This is an administrative complaint for misconduct and
gross negligence filed by complainant Manuel V. Mendoza
(complainant) against Angel L. Doroni (respondent),
Sheriff IV of the Regional Trial Court, Branch 77, of
Quezon City (RTC).
Originally, complainant filed this complaint against Joy
Manalang Bulauitan, Clerk of Court of RTC, and
respondent. However, in the 16 August 2004 Resolution,
the Court dismissed the case against Joy Manalang
Bulauitan for insufficiency of evidence. Hence, only the

case against respondent was docketed as a regular

administrative matter.
The Facts
The Metropolitan Trial Court (MeTC) of Quezon City
rendered a Decision dated 26 March 2002 in Civil Case
No. 38-26931 entitled Atty. Manuel V. Mendoza v. Edgar
A. Cariaga, et al. for forcible entry and damages. The
MeTC issued a writ of execution on 4 September 2002
ordering the defendants to vacate the property and
restore complainants peaceful possession. The MeTC
Sheriff successfully enforced the writ as evidenced by the
Sheriffs Return dated 22 January 2003.
The defendants in Civil Case No. 38-26931 appealed
the MeTC decision. On 10 September 2003, the RTC
reversed the appealed decision. The dispositive portion of
the RTCs Decision reads:
1

WHEREFORE, premises considered, the appealed decision

dated March 26, 2002, of the Court a quo in Civil Case No. 3826931 is hereby reversed and set aside. Accordingly, the
complaint for forcible entry against the defendants-appellants
is hereby dismissed.
Nevertheless, defendants-appellants are hereby ordered to
pay to each of the owners of the structures in the subject
property the amount of Fifteen Thousand Pesos (P15,000.00)
as financial assistance.
SO ORDERED.

Defendants
filed
a
Motion
for
Execution while
complainant filed a Motion for Reconsideration and an
Opposition to the Motion for Execution. On 6 November
2003, the RTC denied complainants motion and
opposition, and ordered the issuance of a writ of
execution. The Branch Clerk of Court issued the writ
directing respondent to execute the decision rendered in
this case.
6

10

On 11 November 2003, respondent, accompanied by

members of the Philippine National Police, served the
writ. Respondent issued a Certificate of Turn-Over of the
property on the same date.
In a Complaint dated 1 December 2003, complainant
asserted that respondent was guilty of misconduct and
gross negligence in the following instances:
11

12

1.He enforced the writ of execution without serving a prior

notice to vacate in violation of Section 10(c), Rule 39, of
the 1997 Rules of Civil Procedure and relevant
jurisprudence.
13

2.He ejected complainant from the property although the

decision, especially the dispositive portion, did not provide
for ejectment. Furthermore, he placed Genuino Ice Co. in
possession of the property although it was not a party to
the case.
3.He delivered possession of the ice-making machines and
equipment although it was not included in the case.
4.He failed to enforce the money judgment in favor of the
owners of the destroyed structures in the amount P15,000
each.

In his Comment dated 6 February 2004, respondent

denied complainants allegations. Respondent claimed
that he has consistently exhibited good performance of
duties in his fifteen years of government service. He
further states that the complaint against him is
premature and impermissible because of a pending
motion (Omnibus Motion) to reconsider the order
granting the writ of execution filed on 13 November 2003
and the pending motion to quash (Supplementary
14

15

Omnibus Motion) the writ of execution filed on 21

November 2003.
Specifically,
respondent
assailed
complainants
allegations, as follows:
16

1.There is an inconsistency in complainants allegation

that [t]here is nothing in the dispositive portion of the
judgment that ordered complainant to vacate the property
and surrender possession to Genuino Ice Co. or to the
defendants-appellants x x x vis--vis the failure to give
prior notice to vacate. Following complainants argument,
if the decision did not provide for complain-ants
ejectment, then Section 10(c), Rule 39 will not apply to the
present case. Hence, respondent did not violate the
requirement of giving prior notice to vacate in cases of
ejectment.
17

2.Respondent asserted that he never ordered the

caretaker and the security guard to leave the property.
Respondent pointed out that the caretaker and the
security guard never left the property but only transferred
what appeared to be sleeping bags from the sleeping
quarters to the guardhouse. As of the date of filing
respondents Comment, complainants security guards
were still present in the property. Respondent stated that
this belies complainants claim that respondent ejected
complainant from the property. Respondent refuted
complainants contention that respondent placed a nonparty to the case in possession of the property. As stated
in the Certificate of Turn-Over, respondent transferred
possession of the property to defendant Cariaga and not
to Genuino Ice Co.
18

19

3.Respondent claimed he acted in good faith and with the

best of intentions when he turned over the machineries
and equipment in the ice plant to defendant Cariaga.

Respondent believed it was his obligation to ensure the

proper safekeeping of the machineries and equipment to
prevent pilferage.
20

4.Respondent insisted that when he served the writ, he

also tried to locate the whereabouts of the four owners of
the destroyed structures. Nobody knew how to contact
them and the RTC Judge who handled the case inhibited
himself. Thus, respondent did not have another
opportunity to implement the decision.
21

In a Joint Manifestation dated 18 May 2004, respondent

stated that Presiding Judge Rogelio M. Pizarro had issued
an Order denying complainants Omnibus Motion and
Supplementary Omnibus Motion in this wise:
22

23

x x x (1) The record of this case show [sic] defendants had

been ejected from the premises by virtue of a writ of execution
issued in the lower court and hence given the fact that the
appealed case against them had been dismissed they should
automatically be restored in possession of the subject
premises; (2) Although the Decision failed inadvertently to
order the restitution of possession in favor of the defendants in
the dispositive portion, the implementation thereof is
nonetheless approved as proper consequence of the dismissal
thereof; (3) The 3-day notice rule under Section 10(c) [sic] Rule
39 of the 1997 Rules of Civil Procedure does not mean that the
occupant therein can be removed only after 3 days
but within such period and thus may include the day the Writ
was served upon them; and (4) Further movant offered no
compelling reason to warrant anew a modification of the
November 6, 2003 Decision.
SO ORDERED.

24

On 30 July 2004, the Office of the Court Administrator

(OCA) issued a Report (Report) recommending that
respondent be fined P10,000 for not implementing fully
the writ of execution.
25

In the Resolution dated 16 August 2004, the Court

docketed the case against respondent as a regular
administrative matter. Further, the Court required
complainant and respondent to manifest if they were
willing to submit the case for decision based on the
pleadings.
On 13 September 2004, respondent submitted a
Manifestation and a Motion asserting that respondent did
not eject complainant from the property to this date.
Respondent asked for an ocular inspection of the
premises to prove this fact. In the 6 October 2004
Resolution, the Court denied the motion for ocular
inspection and gave respondent ten days from notice to
submit additional documentary evidence.
On 14 October 2004, complainant filed his Comment
stating that he had no objection to an ocular inspection.
Complainant stated that respondent removed him from
actual possession of 1,100 square meters out of the
1,565 square meters of land.
On 18 November 2004, complainant filed a
Manifestation stating that he was willing to submit the
case for decision based on the pleadings on record.
On 22 November 2004, respondent filed his
Compliance. He refuted complainants allegation of
ejectment by showing pictures of the property. He
submitted a copy of the RTCs order denying the Omnibus
Motion and Supplemental Omnibus Motion. He also
submitted a copy of the Court of Appeals Resolutions
denying complainants Urgent Last and Final Motion for
Extension to file Petition for Review, Supplementary
Petition, Manifestation and Motion and Petition for
Review.
In a Resolution dated 15 December 2004, the Court
noted respondents Compliance and referred the case to
the OCA for re-evaluation, report and recommendation.
26

The OCAs Evaluation and Recommendation

In its Report dated 30 July 2004, the OCA found
respondent liable for violating Section 10(c), Rule 39 of
the 1997 Rules of Civil Procedure and for not enforcing
the money judgment. The OCAs Evaluation reads:
xxx
Complainant alleged that respondent Sheriff committed
misconduct for implementing the writ of execution without
prior Notice to Vacate the premises in violation of Section 10
(e) [sic] Rule 39 of the 1997 Rules of Civil Procedure which
provides that:
(e) [sic] Delivery or restitution of real propertyThe officer
shall demand of the person against whom the judgment for the
delivery or restitution of real property is rendered and all
persons claiming rights under him to peacefully vacate the
property within three (3) days, and restore possession thereof
to the judgment oblige [sic]; x x x
This allegation was not denied by respondent Sheriff. In his
COMMENT dated February 6, 2004, he stated that:
(f) On November 11, 2003, Atty. Joy Manalang Balauitan,
Branch Clerk of Court of RTC Branch 77, Quezon City, handed
to the undersigned a writ of execution dated November 6,
2003;
(g) On the same day, November 11, 2003, one of the
defendant-appellants in Civil Case No. 2 Q-03-48950, Edgar A.
Cariaga came to the office and requested the undersigned to
serve the writ which he acceded.
On the same date (November 11, 2003) respondent Sheriff
turned over the possession of the property subject of Civil Case
No. Q-03-48-950 to Edgardo Cariaga as shown in the turn over
receipt issued by the respondent in violation of complainants
right to a three (3) day notice to vacate the premises.
Complainant claimed that he was illegally ejected because the
dispositive portion and the body of the decision did not provide

for his ejectment. This allegation of the complainant is not

correct for in the case of Forcible Entry and Detainer, the main
action is priority of possession. The legal right to the property
is not essential to the possessors cause of action.
When complainant filed the complaint for forcible entry
against the defendants in Civil Case No. 26931, the latter was
in actual possession of the property subject of the complaint.
The possession of the property was transferred to the
complainant after the court decided the case in his favor and,
the writ of execution was issued on motion. After the decision
of the lower court was reversed by the higher court, it follows
that the possession of the property should be restored to the
persons who [were] in possession of the property before the
case of Forcible Entry and Damages was filed by the
complainant.
Respondent sheriff is also liable for not enforcing the money
judgment in favor of the owners of the structures in the
property the amount P15,000.00 each as financial assistance
after he turned over the possession of the subject property to
defendant-appellants. Respondent should not have turned over
the possession of the property subject of litigation unless the
money judgment in favor of the owners of the structures is
satisfied. Moreover, there is no showing that respondent Sheriff
demanded from the defendant-appellants the full payment of
the money judgment. If he cannot find the owners of the
structures, as he claimed, the money could be deposited in the
Office of the Clerk of court under the custody of the court for
proper disposition.
27

The OCA recommended that the Court penalize

respondent with a fine of P10,000.
After re-evaluating this case, the OCA remained firm in
its finding that respondent is liable for the offense. In the
OCA Memorandum dated 12 April 2005, it states:
x x x

Notably, nothing in the additional evidence submitted by

the respondent shows his compliance with the aforementioned
rules. Thus, our previous findings should remain.
Likewise, we faulted the respondent for his failure to
execute the money judgment in favor of the owners of the
structures in the property in the amount of P15,000.00 each as
financial assistance. As we have observed in our first report,
respondent should not have turned over the possession of the
property [as shown by the Certificate of Turn-Over (of)
Possession of the Premises, Annex J to the Complaint] unless
the money judgment in favor of the owners of the structures is
satisfied. If the owners cannot be found, as the respondent
claimed, the money could be deposited in the Office of the
Clerk of Court under the custody of the court for proper
disposition. Verily, it was not shown that our previous findings
should be reversed.
28

The Ruling of the Court

The Court finds the recommendation of the OCA welltaken.
On Respondents Failure to Serve a Prior Notice to Vacate
Well-settled is the rule that the sheriffs duty in the
execution of a writ issued by a court is purely
ministerial. The sheriff must comply with the Rules of
Court in executing a writ. Any act deviating from the
procedure laid down in the Rules of Court is a misconduct
and warrants disciplinary action.
In this case, Section 10(c) of Rule 39 prescribes the
procedure in the implementation of the writ. Section 10(c)
expressly provides:
29

30

Sec. 10(c). Delivery or restitution of real property.The officer

shall demand of the person against whom the judgment for the
delivery or restitution of real property is rendered and all
persons claiming rights under him to peaceably vacate the
property within three (3) working days, and restore

possession thereof to the judgment obligee; otherwise, the

officer shall oust all such persons therefrom with the
assistance, if necessary, of appropriate peace officers, and
employing such means as may be reasonably necessary to
retake possession, and place the judgment obligee in
possession of such property. Any costs, damages, rents or
profits awarded by the judgment shall be satisfied in the same
manner as a judgment for money. (Emphasis supplied)

Based on this provision, enforcement in ejectment cases

requires that the sheriff must give notice of such writ and
demand from defendant to vacate the property within
three days. Only after such period can the sheriff enforce
the writ by the bodily removal of defendant and his
personal belongings.
Immediacy of execution does not mean instant
execution. When a decision in ejectment cases states that
it is immediately executory, it does not mean
dispensing with the required notice or three-day removal
period. A sheriff who enforces the writ without the
required notice or before the expiry of the three-day
period runs afoul with Section 10(c) of Rule 39.
Respondent, having been in the government service
for almost fifteen years, should have known by heart this
rule. The notice requirement is based on the rudiments of
justice and fair play. The law frowns upon arbitrariness
and oppressive conduct in the execution of an otherwise
legitimate act.
It is evident from the records that respondent failed to
serve a prior notice to vacate. On the very same day the
writ was handed to him, respondent immediately went to
the property to oust complainants employees.
Respondent did not give any notice to the occupants to
vacate peaceably the property.
31

32

33

On Respondents Failure to Enforce the Money Judgment

Respondents duty is to enforce the writ fully as ordered
by the court. In this case, the RTC ejected complainant
from the property, allowing defendants to regain
possession of the property. However, the RTC required
defendants to pay P15,000 to each owner of the four
destroyed structures within the property. Defendants did
not contest this particular ruling for defendants even
moved for the execution of the RTCs judgment.
Respondents
excuse
in
not
collecting
the
P60,000 from defendants is that he could not locate the
owners of the destroyed structures. This is untenable.
Rule 39 provides for a remedy in case the judgment
creditor could not be located. Section 9 of Rule 39 states:
34

Section 9. Execution of judgments for money, how enforced.x

x x.
If the judgment obligee or his authorized representative is not
present to receive payment, the judgment obligor shall deliver
the aforesaid payment to the executing sheriff. The latter shall
turn over all the amounts coming into his possession within the
same day to the clerk of court of the court that issued the writ,
or if the same is not practicable, deposit said amounts to a
fiduciary account in the nearest government depository bank
of the Regional Trial Court of the locality.
x x x.

Respondent should have collected the P60,000 from

defendants and turned over this amount to the clerk of
court or deposited it to a fiduciary account in the nearest
government depository bank. In fact, respondent should
have collected the P60,000 before turning over
possession of the property to defendants. Defendants
would have been only too willing to pay the P60,000
because defendants prayed for the execution of the writ.
By neglecting to collect the P60,000, respondent failed to

implement the writ fully, to the prejudice of the judgment

creditors who were owners of the four destroyed
structures.
Execution puts an end to litigation, giving justice to the
prevailing party. A decision left unexecuted because of
the sheriffs inefficiency, negligence, misconduct or
ignorance negates all the painstaking effort exerted by
the entire judiciary to render justice to litigants. A sheriff
who fails to execute, or who selectively executes, a final
judgment commits not only a great disservice to the
entire judiciary, he also diminishes the peoples faith in
the judiciary.
WHEREFORE, we find respondent Angel L. Doroni,
Sheriff IV of the Regional Trial Court, Branch 77, of
Quezon City, GUILTY of misconduct and simple neglect of
duty for failing to follow the procedure laid down in
Sections 9 and 10(c), Rule 39 of the 1997 Rules of Civil
Procedure. We FINE him P10,000, with a STERN WARNING
that a repetition of the same or similar act shall merit a
more severe sanction.
SO ORDERED.
Quisumbing(Chairperson), Carpio-Morales and Tin
ga, JJ., concur.
Angel L. Doroni meted with P10,000.00 fine for
misconduct and simple neglect of duty, with stern
warning against repetition of similar act.
Notes.The Court cannot deem a Sheriffs conduct of
a year-and-a-halfs worth of negotiations or dialogues
with the defendants heirs or privies as ample defense for
failing to implement the writs of execution with
appropriate dispatchthe time for persuasion was over
upon the finality of the judgment and issuance of the Writ
of Execution. (Santos vs. Gonzales-Muoz , 387 SCRA
249 [2002])

Any amount received by the sheriff in excess of the

lawful fees allowed by the Rules of Court is an unlawful
exaction which renders him liable for grave misconduct
and gross dishonesty, and conduct prejudicial to the best
interest of the service. (De Guzman, Jr. vs. Mendoza,453

ROSITA
M.
BARRETE,
complainant, vs. JUDGE
VENANCIO J. AMILA, respondent.
Judgments; Ejectment;Execution; Contempt; Mere refusal
or unwillingness on the part of the defendant to vacate
property does not constitute contempt.After carefully
examining the pertinent pleadings and reports filed, the Court
considers that respondent Judge Amila acted arbitrarily and
with disregard for complainants rights when he ordered her
incarceration on the ground of contempt for her failure to
comply voluntarily with the final judgment and the writs of
execution ordering evacuation from the premises and the
delivery of possession of the property to plaintiff. The records
show that at the time complainant was arrested, no delivery of
possession of the subject premises had been made to the
plaintiff; the writ of execution had not yet been implemented.
The mere refusal or unwillingness on the part of complainant
to vacate said property did not constitute contempt.
Same; Same; Same; Same;As writ of possession was
directed not to the defendant but to the Sheriff, who was to
deliver the properties to plaintiff, defendant could not be held
guilty of disobedience of or resistance to a lawful writ.The
writ of possession was directed not to complainant, but to the
Sheriff, who was to deliver the properties to plaintiff
Bungabong. As the writ did not command the complainant to
do anything, complainant could not be held guilty of
disobedience of or resistance to a lawful writ, process, order,
judgment or command of a court. Moreover, complainant could
not be punished for contempt under paragraph (b) of Section
3, Rule 71, for disobedience of or resistance to the judgment of
the trial court because said judgment was not a special
judgment enforceable under Section 9, Rule 39, Rules of Court.
Same; Same; Same; Same;To constitute direct contempt,
the alleged misbehavior must have been committed in the
presence of or so near a court or judge as to obstruct or

interrupt proceedings before the court.Neither can Judge

Amilas contention that complainants acts constituted direct
contempt be accepted. To constitute direct contempt, the
alleged misbehavior must have been committed in the
presence of or so near a court or judge as to obstruct or
interrupt proceedings before the court. Complainant was not
guilty of such misbehavior. In the instant case, complainant
was arrested and detained for failure to comply with the
judgment of eviction, on the mistaken belief of respondent
judge that she was thereby guilty of direct contempt of court
and thus could be summarily punished with imprisonment. To
make matters worse, complainants three (3) minor children,
who had no idea whatsoever about the controversy, were
dragged into it when they were incarcerated with their mother.
Same; Same; Same; Same;Judges; In the absence of the
alleged contempt, the order for complainants arrest had no
legal basis and the Judge acted with grave abuse of authority
and misconduct in office in ordering the arrest of complainant.
Since complainant was not guilty of the alleged contempt,
the order for her arrest had no legal basis. Even if complainant
had been guilty of contempt, the method employed by
respondent Judge to compel compliance from her was not
justified because the same is not sanctioned by the Rules. In
the case of U.S. vs.Ramayrat, the Court ruled that for
execution of the final judgment, the Sheriff could have availed
himself of the public force (i.e., assistance of the police
authorities), had it been necessary to resort thereto. It was not
up to respondent Judge to ensure execution of the judgment by
ordering the arrest of complainant. In the instant case,
respondent Judge acted with grave abuse of authority and
misconduct in office in ordering the arrest of complainant.

ADMINISTRATIVE MATTER in the Supreme Court. Abuse of

power and authority.
The facts are stated in the resolution of the Court.

RESOLUTION
FELICIANO, J.:
This is an administrative complaint dated 4 August 1992,
filed by Rosita M. Barrete against Municipal Circuit Trial
Court (MCTC) Judge Venancio J. Amila, for grave abuse
of power and authority relative to Civil Case No. 313 for
unlawful detainer, entitled Juanita Bungabong vs. Rosita
Barrete.
The instant complaint originated from the decision
rendered by respondent Judge Amila in Civil Case No.
313, in favor of plaintiff Juanita Bungabong, which
ordered defendant Rosita Barrete, herein complainant, to
vacate the house owned by plaintiff which was occupied
by complainant.
A writ of execution was subsequently issued by
respondent Judge in an Order dated 3 January 1992.
However, on 16 January 1992, pursuant to complainants
request, the Sheriff gave her until the end of the month to
vacate the subject premises. As of 6 July 1992, Barrete
had not vacated; hence, an alias writ of execution was
issued. Again, complainant was given an extension of two
(2) days to pack up and leave. On 8 July 1992, the sheriff
went back to the premises and although he did not find
complainant there, it was clear that she had not vacated
because her furniture and other belongings were still in
the house. Upon inquiry, the Sheriff learned that
complainant had gone to Tacloban City and was due to
return anytime. The Sheriff then put a padlock on the
door of the house occupied by complainant.
On 22 July 1992, plaintiff Bungabongs counsel filed a
Motion to Declare Rosita Barrete in Contempt of Court.
On 23 July 1992, respondent Judge issued an Order for
the arrest of Rosita Barrete. Complainant was arrested in
the subject premises on 25 July 1992, a Saturday. A
1

motion to quash the order of arrest and to release Rosita

Barrete was filed, but complainant Barrete and her three
(3) children remained in detention until 28 July 1992, a
Tuesday (the Judge being absent from office Monday, 27
July 1992) after she had been brought before respondent
Judge and had promised that she would vacate the house
and lot she had been occupying.
In her administrative complaint, Rosita Barrete alleged
that she had requested the Provincial Deputy Sheriff to
give her up to the end of July to pack her things and look
for a new place, for her and her three (3) children, to stay
in.
Complainant then left for Tagbilaran City. Meanwhile,
on 8 July 1992, the Sheriff locked up the subject house
with Barretes things still in it.
Upon her return on 23 July 1992, complainant entered
said house by passing through two (2) wooden jalousie
blades, to continue packing her things.
It was in the early morning of 25 July 1992 that
complainant was arrested in the subject house and with
her three (3) minor children, was detained at the
Municipal Jail of Batuan, Bohol, until 28 July 1992.
Before this Court, complainant avers that her arrest
and detention without according her a day in court
constituted a flagrant violation of her right to due
process.
For his part, respondent Judge in his comment, alleges
that after the motion to declare Rosita Barrete in
contempt was filed, he conducted an ocular inspection of
the subject house on 23 July 1992, only to find out that
complainant had indeed not vacated the same. For
complainants disobedience, he issued an Order on 23
July 1992, for her arrest. However, respondent Judge
2

ordered her release on 28 July 1992, right after

complainant promised to vacate the premises.
Respondent Judge argues that complainants acts
constituted direct contempt and the order for her arrest
was made to save Juanita Bungabong from further
irreparable harm and to protect the image of the Court
from degradation. Judge Amila further maintains that if
complainant were charged with indirect contempt, she
would have been imprisoned for not more than one (1)
month, which would be more burdensome on her.
Therefore, his questioned order was beneficial to plaintiff
Bungabong and herein complainant Barrete.
After respondents comment and complainants reply
were filed, the Court referred the matter to Executive
Judge Antonio Bautista of the Regional Trial Court, Branch
1, Tagbilaran, Bohol, for investigation, report and
recommendation. In his Report of 20 November 1993,
Judge Bautista recommended that Judge Amila be
exonerated from the charges made by complainant upon
a finding that he had not been motivated by malice nor
any evil purpose in ordering the arrest of complainant.
The Court, however, is unable to accept this
recommendation.
After carefully examining the pertinent pleading and
reports filed, the Court considers that respondent Judge
Amila acted arbitrarily and with disregard for
complainants rights when he ordered her incarceration
on the ground of contempt for her failure to comply
voluntarily with the final judgment and the writs of
execution ordering evacuation from the premises and the
delivery of possession of the property to plaintiff.
The records show that at the time complainant was
arrested, no delivery of possession of the subject
premises had been made to the plaintiff; the writ of
execution had not yet been implemented.
4

The mere refusal or unwillingness on the part of

complainant to vacate said property did not constitute
contempt. The contumacious act punishable under Rule
71 is:
Sec. 3 (b) Disobedience of or resistance to a lawful writ,
process, order, judgment or command of a court, or injunction
granted by a court or judge, including the act of a person who
after being dispossessed or ejected from any real property by
the judgment or process of any court of competent jurisdiction,
enters or attempts or induces another to enter into or upon
such real property, for the purpose of executing acts of
ownership or possession, or in any manner disturbs the
possession given to the person adjudged to be entitled
thereto. (Italics supplied)

The writ of possession was directed not to complainant,

but to the Sheriff, who was to deliver the properties to
plaintiff Bungabong. As the writ did not command the
complainant to do anything, complainant could not be
held guilty of disobedience of or resistance to a lawful
writ, process, order, judgment or command of a
court. Moreover, complainant could not be punished for
contempt under paragraph (b) of Section 3, Rule 71, for
disobedience of or resistance to the judgment of the trial
court because said judgment was not a special judgment
enforceable under Section 9, Rule 39, Rules of Court,
which reads as follows:
5

Sec. 9. Writ of execution of special judgment.When a

judgment requires the performance of any other actthan the
payment of money, or the sale or delivery of real or personal
property, a certified copy of the judgment shall be attached to
the writ of execution and shall be served by the officer upon
the party against whom the same is rendered, or upon any
other person required thereby, or by law, to obey the same,
and such party or person may be punished for contempt if he
obeys such judgment. (Italics supplied)

When the judgment requires the delivery of real property,

it must be executed in accordance with Section 8(d) of
Rule 39, and any contempt proceeding arising therefrom
must be based on the second part of Section 3(b) of Rule
71 (see underlined portion of Section 3(b), Rule 71 above)
and not on the disobedience of or resistance to a lawful
writ, process, order, judgment, or command of a court, or
injunction granted by a court or judge in relation to
Section 9 of Rule 39.
Neither
can
Judge
Amilas
contention
that
complainants acts constituted direct contempt be
accepted. To constitute direct contempt, the alleged
misbehavior must have been committed in the presence
of or so near a court or judge as to obstruct or interrupt
proceedings before the court. Complainant was not guilty
of such misbehavior.
In the instant case, complainant was arrested and
detained for failure to comply with the judgment of
eviction, on the mistaken belief of respondent judge that
she was thereby guilty of direct contempt of court and
thus could be summarily punished with imprisonment. To
make matters worse, complainants three (3) minor
children, who had no idea whatsoever about the
controversy, were dragged into it when they were
incarcerated with their mother.
Since complainant was not guilty of the alleged
contempt, the order for her arrest had no legal basis.
Even if complainant had been guilty of contempt, the
method employed by respondent Judge to compel
compliance from her was not justified because the same
is not sanctioned by the Rules. In the case of U.S. vs.
Ramayrat, the Court ruled that for execution of the final
judgment, the Sheriff could have availed himself of the
public force (i.e., assistance of the police authorities), had
it been necessary to resort thereto. It was not up to
6

respondent Judge to ensure execution of the judgment by

ordering the arrest of complainant.
In the instant case, respondent Judge acted with grave
abuse of authority and misconduct in office in ordering
the arrest of complainant.
ACCORDINGLY, in view of the foregoing, the Court
Resolved to REQUIRE respondent Judge Venancio Amila
pay a fine equivalent to Two Thousand Pesos (P2,000.00)
with a WARNING that repetition of the same or similar
offense will be met with a more severe penalty.
Bidin, Romero, Meloand Vitug, JJ., concur.
Respondent Judge meted a fine of P2,000.
Notes.The power to hold in contempt must be
exercised on the preservative principle (Dumarpa vs.
Dimaporo, 177 SCRA 478[1989]).
Remedy for refusal of the employer to reinstate the
employee despite several writs of execution is not the
grant of additional backwages to serve as damages but to
file a motion to cite the employer for contempt (Christian
Literature Crusade vs. National Labor Relations
Commission, 171 SCRA 712[1989]).
9

ALFREDO
CHING
and
ENCARNACION
CHING,
petitioners, vs. THE HON. COURT OF APPEALS and ALLIED
BANKING CORPORATION, respondents.
Actions; Parties;Attachment; Remedies of Third Parties
Against Wrongful Attachments; When the sheriff erroneously
levies on attachment and seizes the property of a third person
in which the said defendant holds no right or interest, the
superior authority of the court which has authorized the
execution may be invoked by the aggrieved third person in the
same case, and upon application of the third person, the court
shall order a summary hearing for the purpose of determining
whether the sheriff has acted rightly or wrongly in the
performance of his duties, more specifically if he has indeed
levied on attachment and taken hold of property not belonging
to the plaintiff; The aggrieved third party may also avail
himself of the remedy of terceria by executing an affidavit of
his title or right of possession over the property levied on
attachment and serving the same to the office making the levy
and the adverse party, or file an action to nullify the levy with
damages resulting from the unlawful levy and seizure, which
should be a totally separate and distinct action from the
former case.InOng v. Tating, we held that the sheriff may
attach only those properties of the defendant against whom a
writ of attachment has been issued by the court. When the
sheriff erroneously levies on attachment and seizes the
property of a third person in which the said defendant holds no
right or interest, the superior authority of the court which has
authorized the execution may be invoked by the aggrieved
third person in the same case. Upon application of the third
person, the court shall order a summary hearing for the
purpose of determining whether the sheriff has acted rightly or
wrongly in the performance of his duties in the execution of
the writ of attachment, more specifically if he has indeed
levied on attachment and taken hold of property not belonging

to the plaintiff. If so, the court may then order the sheriff to
release the property from the erroneous levy and to return the
same to the third person. In resolving the motion of the third
party, the court does not and cannot pass upon the question of
the title to the property with any character of finality. It can
treat the matter only insofar as may be necessary to decide if
the sheriff has acted correctly or not. If the claimants proof
does not persuade the court of the validity of the title, or right
of possession thereto, the claim will be denied by the court.
The aggrieved third party may also avail himself of the remedy
of terceria by executing an affidavit of his title or right of
possession over the property levied on attachment and serving
the same to the office making the levy and the adverse party.
Such party may also file an action to nullify the levy with
damages resulting from the unlawful levy and seizure, which
should be a totally separate and distinct action from the former
case. The above-mentioned remedies are cumulative and any
one of them may be resorted to by one third-party claimant
without availing of the other remedies.
Same; Certiorari; Words and Phrases; The tribunal acts
without jurisdiction if it does not have the legal purpose to
determine the case; There is excess of jurisdiction where the
tribunal, being clothed with the power to determine the case,
oversteps its authority as determined by law; There is grave
abuse of discretion where the tribunal acts in a capricious,
whimsical, arbitrary or despotic manner in the exercise of its
judgment and is equivalent to lack of jurisdiction.On the
second issue, we find and so hold that the CA erred in setting
aside and reversing the orders of the RTC. The private
respondent, the petitioner in the CA, was burdened to prove
that the RTC committed a grave abuse of its discretion
amounting to excess or lack of jurisdiction. The tribunal acts
without jurisdiction if it does not have the legal purpose to
determine the case; there is excess of jurisdiction where the
tribunal, being clothed with the power to determine the case,

oversteps its authority as determined by law. There is grave

abuse of discretion where the tribunal acts in a capricious,
whimsical, arbitrary or despotic manner in the exercise of its
judgment and is equivalent to lack of jurisdiction.
Same; Same; When a court exercises its jurisdiction, an
error committed while so engaged does not deprive it of its
jurisdiction being exercised when the error is committed.It
was incumbent upon the private respondent to adduce a
sufficiently strong demonstration that the RTC acted
whimsically in total disregard of evidence material to, and
even decide of, the controversy before certiorari will lie. A
special civil action for certiorari is a remedy designed for the
correction of errors of jurisdiction and not errors of judgment.
When a court exercises its jurisdiction, an error committed
while so engaged does not deprive it of its jurisdiction being
exercised when the error is committed.
Husband and Wife;Conjugal Partnerships; Art. 160 of the
New Civil Code provides that all the properties acquired during
the marriage are presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively to
the husband, or to the wifeas long as the properties were
acquired by the parties during the marriage, they are
presumed to be conjugal in nature.Article 160 of the New Civil
Code provides that all the properties acquired during the
marriage are presumed to belong to the conjugal partnership,
unless it be proved that it pertains exclusively to the husband,
or to the wife. InTan v. Court of Appeals, we held that it is not
even necessary to prove that the properties were acquired
with funds of the partnership. As long as the properties were
acquired by the parties during the marriage, they are
presumed to be conjugal in nature. In fact, even when the
manner in which the properties were acquired does not
appear, the presumption will still apply, and the properties will
still be considered conjugal. The presumption of the conjugal
nature of the properties acquired during the marriage subsists

in the absence of clear, satisfactory and convincing evidence

to overcome the same.
Same; Same; The signing as surety is certainly not an
exercise of an industry or professionno matter how often an
executive acted on or is persuaded to act as surety for his own
employer, this should not be taken to mean that he thereby
embarked in the business of suretyship or guaranty. The
petitioner-husband signed the continuing guaranty and
suretyship agreement as security for the payment of the loan
obtained by the PBMCI from the private respondent in the
amount of P38,000,000. In Ayala Investment and Development
Corp. v. Court of Appeals, this Court ruled that the signing as
surety is certainly not an exercise of an industry or profession.
It is not embarking in a business. No matter how often an
executive acted on or was persuaded to act as surety for his
own employer, this should not be taken to mean that he
thereby embarked in the business of suretyship or guaranty.
Same; Same; To make a conjugal partnership responsible
for a liability that should appertain alone to one of the spouses
is to frustrate the objective of the New Civil Code to show the
utmost concern for the solidarity and well-being of the family
as a unitthe husband is denied the power to assume
unnecessary and unwarranted risks to the financial stability of
the conjugal partnership; No presumption can be inferred from
the fact that when the husband enters into an accommodation
agreement or a contract of surety, the conjugal partnership
would thereby be benefited.For the conjugal partnership to be
liable for a liability that should appertain to the husband alone,
there must be a showing that some advantages accrued to the
spouses. Certainly, to make a conjugal partnership responsible
for a liability that should appertain alone to one of the spouses
is to frustrate the objective of the New Civil Code to show the
utmost concern for the solidarity and well-being of the family
as a unit. The husband, therefore, is denied the power to
assume unnecessary and unwarranted risks to the financial

stability of the conjugal partnership. In this case, the private

respondent failed to prove that the conjugal partnership of the
petitioners was benefited by the petitioner-husbands act of
executing a continuing guaranty and suretyship agreement
with the private respondent for and in behalf of PBMCI. The
contract of loan was between the private respondent and the
PBMCI, solely for the benefit of the latter. No presumption can
be inferred from the fact that when the petitioner-husband
entered into an accommodation agreement or a contract of
surety, the conjugal partnership would thereby be benefited.
The private respondent was burdened to establish that such
benefit redounded to the conjugal partnership.
Same; Same; Loans; The benefits contemplated by Art.
161 of the New Civil Code must be those directly resulting
from a loan, not merely a byproduct or a spin-off of the loan
itself; Where the husband contracts obligations on behalf of
the family business, the law presumes, and rightly so, that
such obligation will redound to the benefit of the conjugal
partnership.It could be argued that the petitioner-husband
was a member of the Board of Directors of PBMCI and was one
of its top twenty stockholders, and that the shares of stocks of
the petitioner-husband and his family would appreciate if the
PBMCI could be rehabilitated through the loans obtained; that
the petitioner-husbands career would be enhanced should
PBMCI survive because of the infusion of fresh capital.
However, these are not the benefits contemplated by Article
161 of the New Civil Code. The benefits must be those directly
resulting from the loan. They cannot merely be a byproduct or
a spin-off of the loan itself. This is different from the situation
where the husband borrows money or receives services to be
used for his own business or profession. In the Ayala case, we
ruled that it is such a contract that is one within the term
obligation for the benefit of the conjugal partnership. Thus:
(A) If the husband himself is the principal obligor in the
contract, i.e., he directly received the money and services to

be used in or for his own business or his own profession, that

contract falls within the term . . . obligations for the benefit of
the conjugal partnership. Here, no actual benefit may be
proved. It is enough that the benefit to the family is apparent
at the time of the signing of the contract. From the very nature
of the contract of loan or services, the family stands to benefit
from the loan facility or services to be rendered to the business
or profession of the husband. It is immaterial, if in the end, his
business or profession fails or does not succeed. Simply stated,
where the husband contracts obligations on behalf of the
family business, the law presumes, and rightly so, that such
obligation will redound to the benefit of the conjugal
partnership.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
Sison, Labitag, Avena,Sereno and Muyot for
petitioners.
Gonzales, Batiller,Bilog & Associates for private
respondents.
CALLEJO, SR., J.:
This petition for review, under Rule 45 of the Revised
Rules of Court, assails the Decision of the Court of
Appeals (CA) dated November 27, 1995 in CA-G.R. SP No.
33585, as well as the Resolution on April 2, 1996 denying
the petitioners motion for reconsideration. The impugned
decision granted the private respondents petition for
certiorari and set aside the Orders of the trial court dated
December 15, 1993 and February 17, 1994 nullifying the
attachment of 100,000 shares of stocks of the Citycorp.
Investment Philippines under the name of petitioner
Alfredo Ching.
The following facts are undisputed:
1

On September 26, 1978, the Philippine Blooming Mills

Company, Inc. (PBMCI) obtained a loan of P9,000,000.00
from the Allied Banking Corporation (ABC). By virtue of
this loan, the PBMCI, through its Executive Vice-President
Alfredo Ching, executed a promissory note for the said
amount promising to pay on December 22, 1978 at an
interest rate of 14% per annum. As added security for the
said loan, on September 28, 1978, Alfredo Ching,
together with Emilio Taedo and Chung Kiat Hua,
executed a continuing guaranty with the ABC binding
themselves to jointly and severally guarantee the
payment of all the PBMCI obligations owing the ABC to
the extent of P38,000,000.00. The loan was subsequently
renewed on various dates, the last renewal having been
made on December 4, 1980.
Earlier, on December 28, 1979, the ABC extended
another loan to the PBMCI in the amount of
P13,000,000.00 payable in eighteen months at 16%
interest per annum. As in the previous loan, the PBMCI,
through Alfredo Ching, executed a promissory note to
evidence the loan maturing on June 29, 1981. This was
renewed once for a period of one month.
The PBMCI defaulted in the payment of all its loans.
Hence, on August 21, 1981, the ABC filed a complaint for
sum of money with prayer for a writ of preliminary
attachment
against
the
PBMCI
to
collect
the
P12,612,972.88 exclusive of interests, penalties and other
bank charges. Impleaded as co-defendants in the
complaint were Alfredo Ching, Emilio Taedo and Chung
Kiat Hua in their capacity as sureties of the PBMCI.
The case was docketed as Civil Case No. 142729 in the
Regional Trial Court of Manila, Branch XVIII. In its
application for a writ of preliminary attachment, the ABC
averred that the defendants are guilty of fraud in
incurring the obligations upon which the present action is
5

10

brought in that they falsely represented themselves to

be in a financial position to pay their obligation upon
maturity thereof. Its supporting affidavit stated,inter
alia, that the [defendants have removed or disposed of
their properties, or [are] ABOUT to do so, with intent to
defraud their creditors.
On August 26, 1981, after an ex-parte hearing, the trial
court issued an Order denying the ABCs application for a
writ of preliminary attachment. The trial court decreed
that the grounds alleged in the application and that of its
supporting affidavit are all conclusions of fact and of
law which do not warrant the issuance of the writ prayed
for. On motion for reconsideration, however, the trial
court, in an Order dated September 14, 1981,
reconsidered its previous order and granted the ABCs
application for a writ of preliminary attachment on a bond
of P12,700,000. The order, in relevant part, stated:
11

12

13

14

With respect to the second ground relied upon for the grant
of the writ of preliminary attachment ex-parte, which is the
alleged disposal of properties by the defendants with intent to
defraud creditors as provided in Sec. 1(e) of Rule 57 of the
Rules of Court, the affidavits can only barely justify the
issuance of said writ as against the defendant Alfredo Ching
who has allegedly bound himself jointly and severally to pay
plaintiff the defendant corporations obligation to the plaintiff
as a surety thereof.
WHEREFORE, let a writ of preliminary attachment issue as
against the defendant Alfredo Ching requiring the sheriff of this
Court to attach all the properties of said Alfredo Ching not
exceeding P12,612,972.82 in value, which are within the
jurisdiction of this Court and not exempt from execution upon,
the filing by plaintiff of a bond duly approved by this Court in
the sum of Twelve Million Seven Hundred Thousand Pesos
(P12,700,000.00) executed in favor of the defendant Alfredo
Ching to secure the payment by plaintiff to him of all the costs

which may be adjudged in his favor and all damages he may

sustain by reason of the attachment if the court shall finally
adjudge that the plaintiff was not entitled thereto.
SO ORDERED.

15

Upon the ABCs posting of the requisite bond, the trial

court issued a writ of preliminary attachment.
Subsequently, summonses were served on the
defendants, save Chung Kiat Hua who could not be
found.
Meanwhile, on April 1, 1982, the PBMCI and Alfredo
Ching jointly filed a petition for suspension of payments
with the Securities and Exchange Commission (SEC),
docketed as SEC Case No. 2250, at the same time
seeking the PBMCIs rehabilitation.
On July 9, 1982, the SEC issued an Order placing the
PBMCIs business, including its assets and liabilities,
under rehabilitation receivership, and ordered that all
actions for claims listed in Schedule A of the petition
pending before any court or tribunal are hereby
suspended in whatever stage the same may be until
further orders from the Commission. The ABC was
among the PBMCIs creditors named in the said schedule.
Subsequently, on January 31, 1983, the PBMCI and
Alfredo Ching jointly filed a Motion to Dismiss and/or
motion to suspend the proceedings in Civil Case No.
142729 invoking the PBMCIs pending application for
suspension of payments (which Ching cosigned) and over
which the SEC had already assumed jurisdiction. On
February 4, 1983, the ABC filed its Opposition thereto.
In the meantime, on July 26, 1983, the deputy sheriff of
the trial court levied on attachment the 100,000 common
shares of Citycorp. stocks in the name of Alfredo Ching.
Thereafter, in an Order dated September 16, 1983, the
trial court partially granted the aforementioned motion by
16

17

18

19

20

21

suspending the proceedings only with respect to the

PBMCI. It denied Chings motion to dismiss the
complaint/or suspend the proceedings and pointed out
that P.D. No. 1758 only concerns the activities of
corporations, partnerships and associations and was
never intended to regulate and/or control activities of
individuals. Thus, it directed the individual defendants to
file their answers.
Instead of filing an answer, Ching filed on January 14,
1984 a Motion to Suspend Proceedings on the same
ground of the pendency of SEC Case No. 2250. This
motion met the opposition from the ABC.
On January 20, 1984, Taedo filed his Answer with
counterclaim and cross-claim. Ching eventually filed his
Answer on July 12, 1984.
On October 25, 1984, long after submitting their
answers, Ching filed an Omnibus Motion, again praying
for the dismissal of the complaint or suspension of the
proceedings on the ground of the July 9, 1982 Injunctive
Order issued in SEC Case No. 2250. He averred that as a
surety of the PBMCI, he must also necessarily benefit
from the defenses of his principal. The ABC opposed
Chings omnibus motion.
Emilio Y. Taedo, thereafter, filed his own Omnibus
Motion praying for the dismissal of the complaint,
arguing that the ABC had abandoned and waived its
right to proceed against the continuing guaranty by its
act of resorting to preliminary attachment.
On December 17, 1986, the ABC filed a Motion to
Reduce the amount of his preliminary attachment bond
from P12,700,000 to P6,350,000. Alfredo Ching opposed
the motion, but on April 2, 1987, the court issued an
Order setting the incident for further hearing on May 28,
1987 at 8:30 a.m. for the parties to adduce evidence on
22

23

24

25

26

27

28

29

the actual value of the properties of Alfredo Ching levied

on by the sheriff.
On March 2, 1988, the trial court issued an Order
granting the motion of the ABC and rendered the
attachment bond of P6,350,000.
On November 16, 1993, Encarnacion T. Ching, assisted
by her husband Alfredo Ching, filed a Motion to Set Aside
the levy on attachment. She allegedinter alia that the
100,000 shares of stocks levied on by the sheriff were
acquired by her and her husband during their marriage
out of conjugal funds after the Citycorp Investment
Philippines was established in 1974. Furthermore, the
indebtedness
covered
by
the
continuing
guaranty/comprehensive suretyship contract executed by
petitioner Alfredo Ching for the account of PBMCI did not
redound to the benefit of the conjugal partnership. She,
likewise, alleged that being the wife of Alfredo Ching, she
was a third-party claimant entitled to file a motion for the
release of the properties. She attached therewith a copy
of her marriage contract with Alfredo Ching.
The ABC filed a comment on the motion to quash
preliminary attachment and/or motion to expunge
records, contending that:
30

31

32

33

2.1The supposed movant, Encarnacion T. Ching, is not a

party to this present case; thus, she has no personality to
file any motion before this Honorable Court;
2.2Said supposed movant did not file any Motion for
Intervention pursuant to Section 2, Rule 12 of the Rules of
Court;
2.3Said Motion cannot even be construed to be in the
nature of a Third-Party Claim conformably with Sec. 14,
Rule 57 of the Rules of Court.

Furthermore, assuming ingracia argumenti that the

supposed movant has the required personality, her Motion
cannot be acted upon by this Honorable Court as the
above-entitled case is still in the archives and the
proceedings thereon still remains suspended. And there is
no previous Motion to revive the same.
34

The ABC also alleged that the motion was barred by

prescription or by laches because the shares of stocks
were in custodia legis.
During the hearing of the motion, Encarnacion T. Ching
adduced in evidence her marriage contract to Alfredo
Ching to prove that they were married on January 8,
1960; the articles of incorporation of Citycorp
Investment Philippines dated May 14, 1979; and, the
General Information Sheet of the corporation showing
that petitioner Alfredo Ching was a member of the
Board of Directors of the said corporation and was one
of its top twenty stockholders.
On December 10, 1993, the Spouses Ching filed their
Reply/ Opposition to the motion to expunge records.
Acting on the aforementioned motion, the trial court
issued on December 15, 1993 an Order lifting the writ of
preliminary attachment on the shares of stocks and
ordering the sheriff to return the said stocks to the
petitioners. The dispositive portion reads:
35

36

37

WHEREFORE, the instant Motion to Quash Preliminary

Attachment, dated November 9, 1993, is hereby granted. Let
the writ of preliminary attachment subject matter of said
motion, be quashed and lifted with respect to the attached
100,000 common shares of stock of Citycorp Investment
Philippines in the name of the defendant Alfredo Ching, the
said shares of stock to be returned to him and his movantspouse by Deputy Sheriff Apolonio A. Golfo who effected the
levy thereon on July 26, 1983, or by whoever may be presently
in possession thereof.

SO ORDERED.

38

The plaintiff Allied Banking Corporation filed a motion for

the reconsideration of the order but denied the same on
February 17, 1994. The petitioner bank forthwith filed a
petition for certiorari with the CA, docketed asCA-G.R. SP
No. 33585, for the nullification of the said order of the
court, contending that:
1.1.The respondent Judge exceeded his authority
thereby acted without jurisdiction in taking
cognizance of, and granting a Motion filed by a
complete stranger to the case.
2. 2.The respondent Judge committed a grave abuse
of discretion in lifting the writ of preliminary
attachment without any basis in fact and in law,
and contrary to established jurisprudence on the
matter.
39

On November 27, 1995, the CA rendered judgment

granting the petition and setting aside the assailed orders
of the trial court, thus:
WHEREFORE, premises considered, the petition is GRANTED,
hereby setting aside the questioned orders (dated December
15, 1993 and February 17, 1994) for being null and void.
SO ORDERED.

40

The CA sustained the contention of the private

respondent and set aside the assailed orders. According
to the CA, the RTC deprived the private respondent of its
right to file a bond under Section 14, Rule 57 of the Rules
of Court. The petitioner Encarnacion T. Ching was not a
party in the trial court; hence, she had no right of action
to have the levy annulled with a motion for that purpose.
Her remedy in such case was to file a separate action
against the private respondent to nullify the levy on the
100,000 Citycorp shares of stocks. The court stated that

even assuming that Encarnacion T. Ching had the right to

file the said motion, the same was barred by laches.
Citing Wong v. Intermediate Appellate Court, the CA
ruled that the presumption in Article 160 of the New Civil
Code shall not apply where, as in this case, the petitionerspouses failed to prove the source of the money used to
acquire the shares of stock. It held that the levied shares
of stocks belonged to Alfredo Ching, as evidenced by the
fact that the said shares were registered in the corporate
books of Citycorp solely under his name. Thus, according
to the appellate court, the RTC committed a grave abuse
of its discretion amounting to excess or lack of jurisdiction
in issuing the assailed orders. The petitioners motion for
reconsideration was denied by the CA in a Resolution
dated April 2, 1996.
The petitioner-spouses filed the instant petition for
review on certiorari, asserting that the RTC did not
commit any grave abuse of discretion amounting to
excess or lack of jurisdiction in issuing the assailed orders
in their favor; hence, the CA erred in reversing the same.
They aver that the source of funds in the acquisition of
the levied shares of stocks is not the controlling factor
when invoking the presumption of the conjugal nature of
stocks under Art. 160, and that such presumption
subsists even if the property is registered only in the
name of one of the spouses, in this case, petitioner
Alfredo Ching. According to the petitioners, the suretyship
obligation was not contracted in the pursuit of the
petitioner-husbands
profession
or
business. And,
contrary to the ruling of the CA, where conjugal assets
are attached in a collection suit on an obligation
contracted by the husband, the wife should exhaust her
motion to quash in the main case and not file a separate
suit. Furthermore, the petitioners contend that under Art.
125 of the Family Code, the petitioner-husbands
41

42

43

44

45

gratuitous suretyship is null and void ab initio, and that

the share of one of the spouses in the conjugal
partnership remains inchoate until the dissolution and
liquidation of the partnership.
In its comment on the petition, the private respondent
asserts that the CA correctly granted its petition for
certiorari nullifying the assailed order. It contends that the
CA correctly relied on the ruling of this Court in Wong
v.Intermediate
Appellate
Court. Citing Cobb-Perez
v.Lantin and G-Tractors, Inc. v. Court of Appeals, the
private respondent alleges that the continuing guaranty
and suretyship executed by petitioner Alfredo Ching in
pursuit of his profession or business. Furthermore,
according to the private respondent, the right of the
petitioner-wife to a share in the conjugal partnership
property is merely inchoate before the dissolution of the
partnership; as such, she had no right to file the said
motion to quash the levy on attachment of the shares of
stocks.
The issues for resolution are as follows: (a) whether the
petitioner-wife has the right to file the motion to quash
the levy on attachment on the 100,000 shares of stocks
in the Citycorp Investment Philippines; (b) whether or not
the RTC committed a grave abuse of its discretion
amounting to excess or lack of jurisdiction in issuing the
assailed orders.
On the first issue, we agree with the petitioners that
the petitioner-wife had the right to file the said motion,
although she was not a party in Civil Case No. 142729.
In Ong v. Tating, we held that the sheriff may attach
only those properties of the defendant against whom a
writ of attachment has been issued by the court. When
the sheriff erroneously levies on attachment and seizes
the property of a third person in which the said defendant
holds no right or interest, the superior authority of the
46

47

48

49

court which has authorized the execution may be invoked

by the aggrieved third person in the same case. Upon
application of the third person, the court shall order a
summary hearing for the purpose of determining whether
the sheriff has acted rightly or wrongly in the
performance of his duties in the execution of the writ of
attachment, more specifically if he has indeed levied on
attachment and taken hold of property not belonging to
the plaintiff. If so, the court may then order the sheriff to
release the property from the erroneous levy and to
return the same to the third person. In resolving the
motion of the third party, the court does not and cannot
pass upon the question of the title to the property with
any character of finality. It can treat the matter only
insofar as may be necessary to decide if the sheriff has
acted correctly or not. If the claimants proof does not
persuade the court of the validity of the title, or right of
possession thereto, the claim will be denied by the court.
The aggrieved third party may also avail himself of the
remedy of terceria by executing an affidavit of his title
or right of possession over the property levied on
attachment and serving the same to the office making
the levy and the adverse party. Such party may also file
an action to nullify the levy with damages resulting from
the unlawful levy and seizure, which should be a totally
separate and distinct action from the former case. The
above-mentioned remedies are cumulative and any one
of them may be resorted to by one third-party claimant
without availing of the other remedies.
In this case, the petitioner-wife filed her motion to set
aside the levy on attachment of the 100,000 shares of
stocks in the name of petitioner-husband claiming that
the said shares of stocks were conjugal in nature; hence,
not liable for the account of her husband under his
continuing guaranty and suretyship agreement with the
50

PBMCI. The petitioner-wife had the right to file the motion

for said relief.
On the second issue, we find and so hold that the CA
erred in setting aside and reversing the orders of the RTC.
The private respondent, the petitioner in the CA, was
burdened to prove that the RTC committed a grave abuse
of its discretion amounting to excess or lack of
jurisdiction. The tribunal acts without jurisdiction if it does
not have the legal purpose to determine the case; there
is excess of jurisdiction where the tribunal, being clothed
with the power to determine the case, oversteps its
authority as determined by law. There is grave abuse of
discretion where the tribunal acts in a capricious,
whimsical, arbitrary or despotic manner in the exercise of
its judgment and is equivalent to lack of jurisdiction.
It was incumbent upon the private respondent to
adduce a sufficiently strong demonstration that the RTC
acted whimsically in total disregard of evidence material
to, and even decide of, the controversy before certiorari
will lie. A special civil action for certiorari is a remedy
designed for the correction of errors of jurisdiction and
not errors of judgment. When a court exercises its
jurisdiction, an error committed while so engaged does
not deprive it of its jurisdiction being exercised when the
error is committed.
After a comprehensive review of the records of the RTC
and of the CA, we find and so hold that the RTC did not
commit any grave abuse of its discretion amounting to
excess or lack of jurisdiction in issuing the assailed
orders.
Article 160 of the New Civil Code provides that all the
properties acquired during the marriage are presumed to
belong to the conjugal partnership, unless it be proved
that it pertains exclusively to the husband, or to the wife.
In Tan v.Court of Appeals, we held that it is not even
51

52

53

necessary to prove that the properties were acquired with

funds of the partnership. As long as the properties were
acquired by the parties during the marriage, they are
presumed to be conjugal in nature. In fact, even when the
manner in which the properties were acquired does not
appear, the presumption will still apply, and the
properties will still be considered conjugal. The
presumption of the conjugal nature of the properties
acquired during the marriage subsists in the absence of
clear, satisfactory and convincing evidence to overcome
the same.
In this case, the evidence adduced by the petitioners in
the RTC is that the 100,000 shares of stocks in the
Citycorp Investment Philippines were issued to and
registered in its corporate books in the name of the
petitioner-husband when the said corporation was
incorporated on May 14, 1979. This was done during the
subsistence of the marriage of the petitioner-spouses.
The shares of stocks are, thus, presumed to be the
conjugal partnership property of the petitioners. The
private respondent failed to adduce evidence that the
petitioner-husband acquired the stocks with his exclusive
money. The barefaced fact that the shares of stocks were
registered in the corporate books of Citycorp Investment
Philippines solely in the name of the petitioner-husband
does not constitute proof that the petitioner-husband, not
the conjugal partnership, owned the same. The private
respondents reliance on the rulings of this Court
in Maramba v.Lozano and Associated Insurance & Surety
Co., Inc. v. Banzon is misplaced. In the Maramba case,
we held that where there is no showing as to when the
property was acquired, the fact that the title is in the
wifes name alone is determinative of the ownership of
the
property.
The
principle
was
reiterated
in
the Associated Insurancecase where the uncontroverted
54

55

56

57

58

evidence showed that the shares of stocks were acquired

during the marriage of the petitioners.
Instead of fortifying the contention of the respondents,
the ruling of this Court in Wong v.Intermediate Appellate
Court buttresses the case for the petitioners. In that
case, we ruled that he who claims that property acquired
by the spouses during their marriage is not conjugal
partnership property but belongs to one of them as his
personal property is burdened to prove the source of the
money utilized to purchase the same. In this case, the
private respondent claimed that the petitioner-husband
acquired the shares of stocks from the Citycorp
Investment Philippines in his own name as the owner
thereof. It was, thus, the burden of the private respondent
to prove that the source of the money utilized in the
acquisition of the shares of stocks was that of the
petitionerhusband alone. As held by the trial court, the
private respondent failed to adduce evidence to prove
this assertion.
The CA, likewise, erred in holding that by executing a
continuing guaranty and suretyship agreement with the
private respondent for the payment of the PBMCI loans,
the petitioner-husband was in the exercise of his
profession, pursuing a legitimate business. The appellate
court erred in concluding that the conjugal partnership is
liable for the said account of PBMCI under Article 161(1)
of the New Civil Code.
Article 161(1) of the New Civil Code (now Article 121[2
and 3] of the Family Code of the Philippines) provides:
59

60

Art. 161. The conjugal partnership shall be liable for:

(1) All debts and obligations contracted by the husband for
the benefit of the conjugal partnership, and those contracted
by the wife, also for the same purpose, in the cases where she
may legally bind the partnership.

The petitioner-husband signed the continuing guaranty

and suretyship agreement as security for the payment of
the loan obtained by the PBMCI from the private
respondent in the amount of P38,000,000. InAyala
Investment and Development Corp. v. Court of
Appeals, this Court ruled that the signing as surety is
certainly not an exercise of an industry or profession. It is
not embarking in a business. No matter how often an
executive acted on or was persuaded to act as surety for
his own employer, this should not be taken to mean that
he thereby embarked in the business of suretyship or
guaranty.
For the conjugal partnership to be liable for a liability
that should appertain to the husband alone, there must
be a showing that some advantages accrued to the
spouses. Certainly, to make a conjugal partnership
responsible for a liability that should appertain alone to
one of the spouses is to frustrate the objective of the New
Civil Code to show the utmost concern for the solidarity
and well being of the family as a unit. The husband,
therefore, is denied the power to assume unnecessary
and unwarranted risks to the financial stability of the
conjugal partnership.
In this case, the private respondent failed to prove that
the conjugal partnership of the petitioners was benefited
by the petitioner-husbands act of executing a continuing
guaranty and suretyship agreement with the private
respondent for and in behalf of PBMCI. The contract of
loan was between the private respondent and the PBMCI,
solely for the benefit of the latter. No presumption can be
inferred from the fact that when the petitioner-husband
entered into an accommodation agreement or a contract
of surety, the conjugal partnership would thereby be
benefited. The private respondent was burdened to
61

62

establish that such benefit redounded to the conjugal

partnership.
It could be argued that the petitioner-husband was a
member of the Board of Directors of PBMCI and was one
of its top twenty stockholders, and that the shares of
stocks of the petitioner-husband and his family would
appreciate if the PBMCI could be rehabilitated through the
loans obtained; that the petitioner-husbands career
would be enhanced should PBMCI survive because of the
infusion of fresh capital. However, these are not the
benefits contemplated by Article 161 of the New Civil
Code. The benefits must be those directly resulting from
the loan. They cannot merely be a byproduct or a spin-off
of the loan itself.
This is different from the situation where the husband
borrows money or receives services to be used for his
own business or profession. In the Ayala case, we ruled
that it is such a contract that is one within the term
obligation for the benefit of the conjugal partnership.
Thus:
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64

(A) If the husband himself is the principal obligor in the

contract,i.e., he directly received the money and services to be
used in or for his own business or his own profession, that
contract falls within the term . . . obligations for the benefit of
the conjugal partnership. Here, no actual benefit may be
proved. It is enough that the benefit to the family is apparent
at the time of the signing of the contract. From the very nature
of the contract of loan or services, the family stands to benefit
from the loan facility or services to be rendered to the business
or profession of the husband. It is immaterial, if in the end, his
business or profession fails or does not succeed. Simply stated,
where the husband contracts obligations on behalf of the
family business, the law presumes, and rightly so, that such
obligation will redound to the benefit of the conjugal
partnership.
65

The Court held in the same case that the rulings of the
Court
in Cobb-Perez and G-Tractors,
Inc. are
not
controlling because the husband, in those cases,
contracted the obligation for his own business. In this
case, the petitioner-husband acted merely as a surety for
the loan contracted by the PBMCI from the private
respondent.
IN LIGHT OF ALL THE FOREGOING, the petition is
GRANTED. The Decision and Resolution of the Court of
Appeals are SET ASIDE AND REVERSED. The assailed
orders of the RTC are AFFIRMED.
SO ORDERED.
Puno (Chairman),Quisumbing, Austria-Martinez an
d Tinga, JJ.,concur.
Petition granted, assailed decision and resolution
reversed and set aside.
Notes.All property of the marriage is presumed to
belong to the conjugal partnership, unless it be proved
that it pertains exclusively to the husband or to the wife.
(Salvador vs. Court of Appeals, 243 SCRA 239 [1995])
Where a woman who cohabited with a married man
fails to prove that she contributed money to the purchase
price of a riceland, there is no basis to justify her coownership over the same the riceland should revert to
the conjugal partnership property of the man and his
lawful wife. (Agapay vs. Palang, 276 SCRA 340 [1997])

ENGR.
WILDEMAR
CAPA
and
DIMPNA
CAPA,
petitioners, vs. COURT
OF
APPEALS,
JESSIE
A.
BELARMINO, UNITED VISMIN SHIPPING LINES, INC., CAPT.
and Mrs. RENE D. YHAPON, JOCELYN RACO and JEFFREY
TOLOSA, respondents.
Actions; Judgments;Appeals; As long as the motion for
execution pending appeal is filed within the period for
perfecting the appeal and prior to the transmittal of the
records to the Court of Appeals, the trial court may order
execution pending appeal upon good reasons to be stated in
the Order granting execution pending appeal.As long as the
motion for execution pending appeal is filed within the period
for perfecting the appeal and prior to the transmittal of the
records to the CA, the trial court may order execution pending
appeal upon good reasons to be stated in the Order granting
execution pending appeal. The trial court granted petitioners
motion for execution pending appeal and issued the writ of
execution commanding sheriff Belarmino to levy the properties
of United Vismin.
Same; Same; Same; Third-Party Claims; The invalidity of
an affidavit of third-party claim should be raised at the earliest
opportunity, which is in the trial court.Petitioners then filed a
Motion to Deny Third-Party Claim with Motion to Admit Claim
for Damages which is a complete turn around from their
motion to approve indemnity bond. The CA did not commit
grave abuse of discretion in not acting on the same since the
invalidity of the affidavit of third-party claim should have been
raised at the earliest opportunity which is in the trial court.
Petitioners could have then moved for the quashal of the
same, thus they could not now invoke the jurisdiction of the CA
to rule on the same when they in fact had already waived the
alleged defect in the affidavit when they sought from the CA
the approval of the indemnity bond they posted in the trial
court.

Same; Third-Party Claims;A third party claimant or any

third person may vindicate his claim to his property wrongfully
levied by filing a proper action which is distinct and separate
from that in which the judgment is being enforced; When a
frivolous and plainly spurious claim was filed by a third-party
claimant, the judgment obligee has a remedy to file a claim for
damages in the same court where the third-party claimant
filed his third-party claim or to file a separate action.A third
party claimant or any third person may vindicate his claim to
his property wrongfully levied by filing a proper action which is
distinct and separate from that in which the judgment is being
enforced. Such action would have for its object the recovery of
the possession of the property seized by the sheriff, as well as
damages resulting from the allegedly wrongful seizure and
detention thereof despite the third-party claim; and it may be
brought against the sheriff, of course, and such other parties
as may be alleged to have colluded with the sheriff in the
supposedly wrongful execution proceedings, such as the
judgment creditor himself. The same paragraph also provides a
remedy to a judgment oblige when a frivolous and plainly
spurious claim was filed by a third-party claimant, i.e., to file
his claim for damages in the same court where the third-party
claimant filed his third-party claim or to file a separate action.
Thus, petitioners claim for damages must be filed in the trial
court, whether in the same case where a third-party claim has
been filed or in a separate action for damages which
petitioners may institute. This is so in order to require the filing
of proper pleadings and to hold trial so as to give the parties
the chance to submit their respective evidence.

SPECIAL CIVIL ACTION in the Supreme Court. Certiorari

and Mandamus.
The facts are stated in the opinion of the Court.
Ronald C. Catipay and Associates for petitioners.

Fiorello T. Quijano for respondents J. Raco and J.

Tolosa.
Manuel Monzon for respondents United Vismin and
Sps. Yhapon.
AUSTRIA-MARTINEZ, J.:
Before us is a petition forcertiorari and mandamusfiled by
Engr. Wildemar Capa and Dimpna Capa (petitioners)
assailing the Resolution dated February 13, 2003 of the
Court of Appeals (CA) which noted without action
petitioners Motion to Deny Third-Party Claim with Motion
to Admit Claim for Damages and the Resolution dated
August 27, 2003 denying petitioners motion for
reconsideration.
Petitioners
were
the
owners
of
a
motor bancanamed M/B CLM Zoltanwhich they used for
their fish trading business. United Vismin Shipping Lines,
Inc. (private respondent United Vismin) was the owner of
the motorized vessel named M/V Cebu Pearl. In the
evening of April 21, 1993, M/B CLM Zoltanand M/V Cebu
Pearl manned by Captain Rene Yhapon collided in the
waters of Dumaguete City which resulted in the sinking of
petitioners M/B CLM Zoltan.
On August 27, 1993, petitioners filed with the Regional
Trial Court (RTC) of Cebu City, Branch 8, a complaint for
damages, attorneys fees against private respondent
United Vismin and Captain and Mrs. Rene Yhapon (private
respondent Spouses Yhapon).
After trial on the merits, the RTC rendered a
Decision dated March 9, 2001 in favor of petitioners, the
dispositive portion of which reads:

1. 1)actual damages in the amount of P483,053.08;

2. 2)P100,000.00 representing loss of profits;
3. 3)Moral damages in the amount of P100,000.00;
4. 4)Attorneys fees in the amount of P50,000.00;
5. 5)Exemplary damages in the amount of P20,000.00;
6. 6)P3,792.00 as litigation expenses.

In view of the foregoing considering that a preponderance of

evidence exists in favor of the plaintiffs and against the
defendants, judgment is hereby rendered ordering the
defendants solidarily to pay the plaintiffs:

SO ORDERED.

Private respondents United Vismin and Spouses Yhapon

filed their notice of appeal on April 18, 2001. In its
Order dated June 6, 2001, the RTC gave due course to the
appeal and ordered the records to be elevated to the CA.
Earlier, on April 2, 2001, petitioners filed an Urgent
Motion for Execution Pending Appeal on the ground that
private respondent United Vismin had already given
notice to the Maritime Industry Authority (MARINA) of the
cessation of its operation. The RTC granted petitioners
motion in an Order dated August 20, 2001 after
petitioners submission of a certification from MARINA
that private respondent United Vismin had suspended
operation of its five vessels. A writ of execution pending
appeal was issued to Sheriff Jessie A. Belarmino on
September 19, 2001.
On January 14, 2002, Sheriff Belarmino issued a notice
of levy addressed to the Regional Director of MARINA
levying two vessels registered in the name of private
respondent
United
Vismin,
namely MV
Island
Pearl and MV Sea Pearl.
On January 18, 2002, private respondent Jocelyn Raco
(Raco) through her attorney-in-fact, private respondent
Jeffrey Tolosa (Tolosa), filed a Third-Party Claim with the
RTC claiming ownership over MV Island Pearl and MV Sea
6

10

11

Pearl. An Amended Third-Party Claim was subsequently

filed on January 24, 2002. A notice of the claim was sent
to petitioners by Sheriff Belarmino who required the
former to file an indemnity bond in the amount of
P2,700,000.00 on February 4, 2002.
On January 25, 2002, private respondent United Vismin
and spouses Yhapon filed a Motion to Quash Levy on the
ground that petitioners were not required to put up a
bond in favor of private respondent United Vismin as
security on the latters part in the event that the
appealed decision will be reversed. The RTC in its Order
dated February 1, 2002, did not entertain the motion
since it has lost jurisdiction over the case with the
perfection of the appeal.
On February 6, 2002, the entire records of the civil
case were elevated to the CA where the case was
docketed as CA G.R. CV No. 74688.
Petitioners filed with the CA a motion to approve
sheriffs indemnity bond, posted and received by the
Office of the Sheriff on February 18, 2002 for the levy of
the vessel MV Island Pearl. An opposition thereto was
filed by the third party claimant.
On July 22, 2002, the CA held in abeyance any action
on petitioners motion pending submission of the certified
true copy of the surety bond and the certification from
the Supreme Court that the surety company is not blacklisted.
On October 1, 2002, the CA issued a resolution denying
the Motion to approve sheriffs indemnity bond for failure
of petitioners to comply with the July 22, 2002 Resolution
and noted the opposition. Petitioners motion for
reconsideration was also denied in a Resolution dated
January 6, 2003.
12

13

On December 5, 2002, petitioners filed with the CA a

Motion to Deny Third-Party Claim with Motion to Admit
Claim for Damages praying that the third-party claim be
denied for it is invalid as it was not signed by Raco but by
her alleged attorney-in-fact, Tolosa. Petitioners further
prayed that their claim for damages arising from the
malicious filing of the third-party claim against Raco and
Tolosa be admitted by the CA in the same appealed case.
On February 13, 2002, the CA issued its assailed
Resolution, to wit:
Plaintiffs-appellees Motion to Deny Third-Party Claim with
Motion to Admit Claim for Damages is NOTED without action.
The said motion should have been filed with the Regional Trial
Court of Cebu, Branch VIII, Cebu City, and not with this Court.

Petitioners motion for reconsideration was denied in a

Resolution dated August 27, 2003.
Hence
the
instant
petition
for certiorari and mandamuson the following grounds:
GROUND FOR CERTIORARI
THE HONORABLE COURT OF APPEALS COMMITTED GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
ITS JURISDICTION IN FAILING TO DENY THIRD-PARTY CLAIM
FILED BY JOCELYN RACO, WHEN THE SAME IS PALPABLY NULL
AND VOID.
GROUND FOR MANDAMUS
THE HONORABLE COURT OF APPEALS UNLAWFULLY
NEGLECTED THE PERFORMANCE OF AN ACT SPECIFICALLY
ENJOINED BY THE RULES, BY REFUSING TO TAKE COGNIZANCE
OF PETITIONERS CLAIM FOR DAMAGES AGAINST THE THIRD
PARTY CLAIMANT, JOCELYN RACO AND JEFFREY TOLOSA, WHO
FILED A FRIVOLOUS AND PLAINLY SPURIOUS THIRD-PARTY
CLAIM.

Petitioners argue that the third-party claim is a nullity

since the affidavit where third-party claimant Raco stated
that she is the owner and has the right to possess the
levied properties, was not signed by her but by Tolosa,
her attorney in-fact, who did not even pretend to be a
privy to the transactions entered into by Raco; that no
special power of attorney that may have been executed
by Raco in favor of Tolosa was attached to the amended
third-party claim and neither did the affidavit allege that
Tolosa was a duly authorized agent of Raco; that even if
Tolosa was authorized by Raco to subscribe the latters
affidavit, the same authority is void ab initio for being
contrary to law.
Petitioners claim that the CA has jurisdiction to resolve
the Motion to Deny Third-Party Claim with Motion to
Admit Claim for Damages since the trial court had lost
jurisdiction over the case when the respective appeals of
private respondents and petitioners were already
perfected and the entire records of the case were already
transmitted to the CA on February 6; that such motion is
an incident to the execution of the trial courts decision
pending appeal before the CA; and that their filing of the
motion with the CA is sanctioned by Section 2, Rule 39 of
the Rules of Court which provides that after a trial court
loses jurisdiction over a case, a motion for execution
pending appeal may be filed before the appellate court.
Petitioners further contend that the CA should also take
cognizance of their claim for damages arising from the
spurious and frivolous third party claim filed by Raco as
provided under Section 16, Rule 39 of the Rules of Court;
that the transfer of ownership of vessels by private
respondent United Vismin to third-party claimant Raco
was for the purpose of evading satisfaction of the
appealed decision as can be shown by the fact that one
day after petitioners sent a letter to MARINA requesting

for a certification of private respondent United Vismins

filing of a notice to suspend operation of its vessels to
support their motion for execution pending appeal,
private respondent United Vismin filed a petition with
MARINA for the transfer of five vessels to Raco, without
petitioners knowledge; that although private respondent
United Vismin purportedly sold only three vessels in the
Deed of Sale dated January 29, 2002 in favor of Raco, five
vessels were included in the petition for transfer to Raco
which showed the dubious error in the petition for
transfer.
In their Comment, Raco avers that the third party claim
was filed in accordance with Section 16, Rule 39 of the
Rules of Court; that the levy was never perfected because
of petitioners failure to have the sheriffs indemnity bond
approved by the CA despite extensions granted; that the
issue that Tolosa as attorney-in-fact of Raco was the one
who signed the affidavit of the third party claim should
have been brought right at the beginning when petitioner
was furnished copy of said document and was presented
before the sheriff and during the time when petitioner
filed an extension to put up an indemnity bond before the
CA.
Private respondents United Vismin and Spouses
Yhapon filed their Comment stating that the levy on the
vessels was never perfected for failure of petitioners to
have their bond approved by the CA; that as of August 7,
2002, the sheriff had already lifted the levy on one of the
vessels; that when petitioners opted not to file an
indemnity bond, they should have filed a separate action
instead of the several motions filed with CA and with this
Court.
In their Reply, petitioners contend that in view of the
nullity of the third-party claim filed by Tolosa in behalf of
Raco, there was no need for petitioners to post an

indemnity bond for the execution pending appeal to

proceed; that the issue raised in this petition is the
validity of the third-party claim, not the failure to post
indemnity bond; no copy of the SPA executed by Raco
was attached to the explanation served on petitioners;
that Raco failed to controvert the claim of the nullity of
the affidavit signed by Tolosa.
The issue for resolution is whether the CA committed
grave abuse of discretion when it did not act on
petitioners Motion to Deny Third-Party Claim with Motion
to Admit Claim for Damages on the ground that the same
should have been filed with the Regional Trial Court of
Cebu, Branch VIII, Cebu City.
The petition for certiorarilacks merit.
Section 9, Rule 41 of the Rules of Court explains the
instances when the trial court loses jurisdiction over a
case:
Sec. 9. Perfection of appeal; effect thereof.A partys appeal
by notice of appeal is deemed perfected as to him upon the
filing of the notice of appeal in due time.
xxxx
In appeals by notice of appeal, the court loses jurisdiction
over the case upon the perfection of the appeals filed in due
time and the expiration of the time to appeal of the other
parties.
xxxx
In either case, prior to the transmittal of the original record
or the record on appeal, the court may issue orders for the
protection and preservation of the rights of the parties which
do not involve any matter litigated by the appeal, approve
compromises, permit appeals of indigent litigants, order
execution pending appeal in accordance with Section 2 of Rule
39, and allow withdrawal of the appeal.

On the other hand, Section 2, Rule 39 provides:

SEC. 2. Discretionary execution.

(a) Execution of a judgment or a final order pending appeal.
On motion of the prevailing party with notice to the adverse
party filed in the trial court while it has jurisdiction over the
case and is in possession of either the original record or the
record on appeal, as the case may be, at the time of the filing
of such motion, said court may, in its discretion, order
execution of a judgment or final order even before the
expiration of the period to appeal.
After the trial court has lost jurisdiction, the motion for
execution pending appeal may be filed in the appellate court.
Discretionary execution may only issue upon good reasons
to be stated in a special order after due hearing.
xxxx

Clearly, as long as the motion for execution pending

appeal is filed within the period for perfecting the appeal
and prior to the transmittal of the records to the CA, the
trial court may order execution pending appeal upon
good reasons to be stated in the Order granting execution
pending appeal. The trial court granted petitioners
motion for execution pending appeal and issued the writ
of execution commanding sheriff Belarmino to levy the
properties of United Vismin.
However, a third party-claim was filed by Raco through
her attorney-in-fact Tolosa pursuant to Section 16, Rule 3
of the Rules of Court which provides:
Sec. 16. Proceedings where property claimed by third person.
If the property levied on is claimed by any person other than
the judgment obligor or his agent, and such person makes an
affidavit of his title thereto or right to the possession thereof,
stating the grounds of such right or title, and serve the same
upon the officer making the levy and a copy thereof upon the
judgment obligee, the officer shall not be bound to keep the
property, unless such judgment obligee, on demand of the

officer, files a bond approved by the court to indemnify the

third-party claimant in a sum not less than the value of the
property levied on. In case of disagreement as to such value,
the same shall be determined by the court issuing the writ of
execution. No claim for damages for the taking or keeping of
the property may be enforced against the bond unless the
action therefor is filed within one hundred twenty days (120)
days from the date of the filing of the bond.
The officer shall not be liable for damages for the taking or
keeping of the property, to any third-party claimant if such
bond is filed.
xxxx

In this case, Raco availed of the remedy known

asterceria, by serving on the officer making the levy an
affidavit of his title and a copy thereof upon petitioners.
Upon receipt of such affidavit, sheriff Belarmino who is
not bound to keep the properties because of such third
party claim, notified petitioners of such claim and
required them to post an indemnity bond in the amount
of P2,700,000.00 on February 4, 2002 to answer for any
liability he may incur by reason of such execution.The
matter of the invalidity of the affidavit of the thirdparty claimant was never raised by petitioners in
the trial court which could have still ruled on the
same since the records were still with it at the time
such third party claim was filed.Moreover, petitioners
even filed an indemnity bond in the amount of
P1,400,000.00 with the Office of the Sheriff on February
18, 2002.
As the appeal of private respondents United Vismin and
Spouses Yhapon had already been perfected and the
records were elevated to the CA on February 6, 2002,
petitioners then filed with the CA a motion seeking for the
approval of the sheriffs indemnity bond they posted on
February 18, 2002. The CA then held in abeyance the
14

action therein pending submission of a certified true copy

of a surety bond and a certification from the Supreme
Court that the surety bond is not black-listed.
Subsequently, petitioners motion to approve bond in a
Resolution dated October 1, 2001 was denied for failure
to comply with such directive. Despite motions for
extension of time to look for a qualified and sufficient
indemnity bond affordable, petitioners failed to do so
which prompted the CA to deny the same.
Petitioners then filed a Motion to Deny Third-Party
Claim with Motion to Admit Claim for Damages which is a
complete turn around from their motion to approve
indemnity bond. The CA did not commit grave abuse of
discretion in not acting on the same since the invalidity of
the affidavit of third-party claim should have been raised
at the earliest opportunity which is in the trial court.
Petitioners could have then moved for the quashal of the
same, thus they could not now invoke the jurisdiction of
the CA to rule on the same when they in fact had already
waived the alleged defect in the affidavit when they
sought from the CA the approval of the indemnity bond
they posted in the trial court.
We likewise find no basis for the petition
formandamus filed by petitioners to compel the CA to act
on petitioners Motion to Admit Claim for damages as it
had no jurisdiction to do so.
The second paragraph of Section 16, Rule 39 of the
Rules of Court which is invoked by petitioners to support
their claim provides:
x x x Nothing herein contained shall prevent such claimant or
any third person from vindicating his claim to the property in a
separate action, or prevent the judgment obligee from
claiming damages in the same or separate action against a
third-party claimant who filed a frivolous or plainly spurious
claim.

Clearly, a third party claimant or any third person may

vindicate his claim to his property wrongfully levied by
filing a proper action which is distinct and separate from
that in which the judgment is being enforced. Such action
would have for its object the recovery of the possession
of the property seized by the sheriff, as well as damages
resulting from the allegedly wrongful seizure and
detention thereof despite the third-party claim; and it
may be brought against the sheriff, of course, and such
other parties as may be alleged to have colluded with the
sheriff in the supposedly wrongful execution proceedings,
such as the judgment creditor himself.
The same paragraph also provides a remedy to a
judgment obligee when a frivolous and plainly spurious
claim was filed by a third-party claimant, i.e., to file his
claim for damages in the same court where the thirdparty claimant filed his third-party claim or to file a
separate action. Thus, petitioners claim for damages
must be filed in the trial court, whether in the same case
where a third-party claim has been filed or in a separate
action for damages which petitioners may institute. This
is so in order to require the filing of proper pleadings and
to hold trial so as to give the parties the chance to submit
their respective evidence.
WHEREFORE,
the
petition
for certiorari andmandamus is DISMISSED for lack of
merit.
No pronouncement as to costs.
SO ORDERED.
Panganiban (C.J.,
Chairperson), YnaresSantiago, Callejo, Sr. andChico-Nazario, JJ., concur.
Petition for certiorari and mandamus dismissed.
Notes.A motion for execution pending appeal may
be filed before the expiration of the period to appeal. An
15

appeal is deemed perfected not by the filing of the notice

of appeal by one party, but upon the expiration of the last
day to appeal by any party. (Provident International
Resources Corp. vs. Court of Appeals, 259 SCRA
485[1996])
While present election laws are silent on the remedy of
execution pending appeal in election contests, there is no
case law holding that such remedy is exclusive to election
contests involving elective barangay and municipal
officialsSection 2, Rule 39 of the Rules of Court allowing
execution pending appeal in the discretion of the court
applies in a suppletory manner to election cases,
including those involving city and provincial officials.
(Batul vs. Bayron, 424 SCRA 26 [2004])

DIONISIO
FIESTAN
and
JUANITA
ARCONADO,
petitioners, vs. COURT OF APPEALS; DEVELOPMENT BANK
OF THE PHILIPPINES, LAOAG CITY BRANCH; PHILIPPINE
NATIONAL BANK, VIGAN BRANCH, ILOCOS SUR;
FRANCISCO PERIA; and REGISTER OF DEEDS OF ILOCOS
SUR, respondents.
Civil Law; Levy;Foreclosure; Levy defined.Levy, as
understood under Section 15, Rule 39 of the Rules of Court in
relation to execution of money judgments, has been defined by
this Court as the act whereby a sheriff sets apart or
appropriates for the purpose of satisfying the command of the
writ, a part or the whole of the judgment-debtors property.
Same; Same; Same;Formalities of a levy as an essential
requisite of a valid execution sale under Section 15 of Rule 39
and a valid attachment lien under Rule 57 of the Rules of Court
are not basic requirements before an extrajudicially foreclosed
property can be sold at public auction; Three different kinds of
sales under the law, distinguished.The formalities of a levy,
as an essential requisite of a valid execution sale under Section
15 of Rule 39 and a valid attachment lien under Rule 57 of the
Rules of Court, are not basic requirements before an
extrajudicially foreclosed property can be sold at public
auction. At the outset, distinction should be made of the three
different kinds of sales under the law, namely: an ordinary
execution sale, a judicial foreclosure sale, and an extrajudicial
foreclosure sale, because a different set of law applies to each
class of sale mentioned. An ordinary execution sale is
governed by the pertinent provisions of Rule 39 of the Rules of
Court. Rule 68 of the Rules of Court applies in cases of judicial
foreclosure sale. On the other hand, Act No. 3135, as amended
by Act No. 4118 otherwise known as An Act to Regulate the
Sale of Property under Special Powers Inserted in or Annexed
to Real Estate Mortgages applies in cases of extrajudicial
foreclosure sale.

Same; Same; Same; Same;Case at bar involves an

extrajudicial foreclosure sale.The case at bar, as the facts
disclose, involves an extrajudicial foreclosure sale. The public
auction sale conducted on August 6, 1979 by the Provincial
Sheriff of Ilocos Sur refers to the sale mentioned in Section 1
of Act No. 3135, as amended, which was made pursuant to a
special power inserted in or attached to a real estate mortgage
made as security for the payment of money or the fulfillment
of any other obligation. It must be noted that in the mortgage
contract, petitioners, as mortgagor, had appointed private
respondent DBP, for the purpose of extrajudicial foreclosure,
as his attorney-in-fact to sell the property mortgaged under
Act No. 3135, as amended, to sign all documents and perform
any act requisite and necessary to accomplish said purpose x x
x. In case of foreclosure, the Mortgagor hereby consents to the
appointment of the mortgagee or any of its employees as
receiver, without any bond, to take charge of the mortgaged
property at once, and to hold possession of the same x x x.
Same; Same; Same; Same;Act No. 3135 as amended
being a special law governing extrajudicial foreclosure
proceedings must govern as against the provisions on ordinary
sale under Rule 39 of the Rules of Court.There is no
justifiable basis, therefore, to apply by analogy the provisions
of Rule 39 of the Rules of Court on ordinary execution sale,
particularly Section 15 thereof as well as the jurisprudence
under said provision, to an extrajudicial foreclosure sale
conducted under the provisions of Act No. 3135, as amended.
Act No. 3135, as amended, being a special law governing
extrajudicial foreclosure proceedings, the same must govern as
against the provisions on ordinary execution sale under Rule
39 of the Rules of Court.
Same; Same; Same; Same;Property
sought
to
be
foreclosed need not be identified or set apart by the sheriff
from the whole mass of property of the mortgagor for the
purpose of satisfying the mortgage indebtedness.In

extrajudicial foreclosure of mortgage, the property sought to

be foreclosed need not be identified or set apart by the sheriff
from the whole mass of property of the mortgagor for the
purpose of satisfying the mortgage indebtedness. For, the
essence of a contract of mortgage indebtedness is that a
property has been identified or set apart from the mass of the
property of the debtor-mortgagor as security for the payment
of money or the fulfillment of an obligation to answer the
amount of indebtedness.
Same; Same; Same;Prohibition mandated by par (2) of
Article 1491 in relation to Article 1409 of the Civil Code does
not apply where the sale of the property in dispute was made
under a special power inserted in or attached to the real
estate mortgage pursuant to Act No. 3135 as amended.The
prohibition mandated by par. (2) of Articles 1491 in relation to
Article 1409 of the Civil Code does not apply in the instant
case where the sale of the property in dispute was made under
a special power inserted in or attached to the real estate
mortgage pursuant to Act No. 3135, as amended. It is a
familiar rule of statutory construction that, as between a
specific statute and general statute, the former must prevail
since it evinces the legislative intent more clearly than a
general statute does. The Civil Code (R.A. 386) is of general
character while Act No. 3135, as amended, is a special
enactment and therefore the latter must prevail.
Same; Same; Same; Same;Section 5 of Act No. 3135, as
amended, is an exception to the general rule that a mortgagee
or trustee in a mortgage or deed of trust which contains a
power of sale on default may not become the purchaser at a
sale which he himself makes under the power.In other words,
Section 5 of Act No. 3135, as amended, creates and is
designed to create an exception to the general rule that a
mortgagee or trustee in a mortgage or deed of trust which
contains a power of sale on default may not become the
purchaser, either directly or through the agency of a third

person, at a sale which he himself makes under the power.

Under such an exception, the title of the mortgagee-creditor
over the property cannot be impeached or defeated on the
ground that the mortgagee cannot be a purchaser at his own
sale.

PETITION for certiorari to review the decision of the Court

of Appeals.
The facts are stated in the opinion of the Court.
Pedro Singson Reyesfor petitioners.
The Chief Legal Counsel for PNB.
Public Assistance Office for Francisco Feria.
Ruben O. Fruto,Bonifacio M. Abad and David C.
Frez for DBP Laoag Branch.
FERNAN, C.J.:
In this petition for review on certiorari, petitioners
spouses Dionisio Fiestan and Juanita Arconada, owners of
a parcel of land (Lot No. 2-B) situated in Ilocos Sur
covered by TCT T- 13218 which they mortgaged to the
Development Bank of the Philippines (DBP) as security for
their P22,400.00 loan, seek the reversal of the decision of
the Court of Appeals dated June 5, 1987 affirming the
dismissal of their complaint filed against the
Development Bank of the Philippines, Laoag City Branch,
Philippine National Bank, Vigan Branch, Ilocos Sur,
Francisco Peria and the Register of Deeds of Ilocos Sur,
for annulment of sale, mortgage, and cancellation of
transfer certificates of title.
Records show that Lot No. 2-B was acquired by the DBP
as the highest bidder at a public auction sale on August
6, 1979 after it was extrajudicially foreclosed by the DBP
in accordance with Act No. 3135, as amended by Act No.
4118, for failure of petitioners to pay their mortgage
indebtedness. A certificate of sale was subsequently
1

issued by the Provincial Sheriff of Ilocos Sur on the same

day and the same was registered on September 28, 1979
in the Office of the Register of Deeds of Ilocos Sur. Earlier,
or on September 26, 1979, petitioners executed a Deed
of Sale in favor of DBP which was likewise registered on
September 28, 1979.
Upon failure of petitioners to redeem the property
within the one (1) year period which expired on
September 28, 1980, petitioners TCT T-13218 over Lot
No. 2-B was cancelled by the Register of Deeds and in lieu
thereof TCT T-19077 was issued to the DBP upon
presentation of a duly executed affidavit of consolidation
of ownership.
On April 13, 1982, the DBP sold the lot to Francisco
Peria in a Deed of Absolute Sale and the same was
registered on April 15, 1982 in the Office of the Register
of Deeds of Ilocos Sur. Subsequently, the DBPs title over
the lot was cancelled and in lieu thereof TCT T-19229 was
issued to Francisco Peria.
After title over said lot was issued in his name,
Francisco Peria secured a tax declaration for said lot and
accordingly paid the taxes due thereon. He thereafter
mortgaged said lot to the PNB-Vigan Branch as security
for his loan of P115,000.00 as required by the bank to
increase his original loan from P49,000.00 to P66,000.00
until it finally reached the approved amount of
P115,000.00. Since petitioners were still in possession of
Lot No. 2-B, the Provincial Sheriff ordered them to vacate
the premises.
On the other hand, petitioners filed on August 23, 1982
a complaint for annulment of sale, mortgage and
cancellation of transfer certificates of title against the
DBP-Laoag City, PNB-Vigan Branch, Ilocos Sur, Francisco
Peria and the Register of Deeds of Ilocos Sur, docketed as

Civil Case No. 3447-V before the Regional Trial Court of

Vigan, Ilocos Sur.
After trial, the RTC of Vigan, Ilocos Sur, Branch 20,
rendered its decision on November 14, 1983 dismissing
the complaint, declaring therein, as valid the extrajudicial
foreclosure sale of the mortgaged property in favor of the
DBP as highest bidder in the public auction sale held on
August 6, 1979, and its subsequent sale by DBP to
Francisco Peria as well as the real estate mortgage
constituted thereon in favor of PNB-Vigan as security for
the P115,000.00 loan of Francisco Peria.
The Court of Appeals affirmed the decision of the RTC
of Vigan, Ilocos Sur on June 20, 1987.
The motion for reconsideration having been denied on
January 19, 1988, petitioners filed the instant petition for
review on certiorari with this Court. Petitioners seek to
annul the extrajudicial foreclosure sale of the mortgaged
property on August 6, 1979 in favor of the Development
Bank of the Philippines (DBP) on the ground that it was
conducted by the Provincial Sheriff of Ilocos Sur without
first effecting a levy on said property before selling the
same at the public auction sale. Petitioners thus
maintained that the extrajudicial foreclosure sale being
null and void by virtue of lack of a valid levy, the
certificate of sale issued by the Provincial Sheriff cannot
transfer ownership over the lot in question to the DBP
and consequently the deed of sale executed by the DBP
in favor of Francisco Peria and the real estate mortgage
constituted thereon by the latter in favor of PNB-Vigan
Branch are likewise null and void.
The Court finds these contentions untenable.
The formalities of a levy, as an essential requisite of a
valid execution sale under Section 15 of Rule 39 and a
valid attachment lien under Rule 57 of the Rules of Court,
are not basic requirements before an extrajudicially
2

foreclosed property can be sold at public auction. At the

outset, distinction should be made of the three different
kinds of sales under the law, namely: an ordinary
execution sale, a judicial foreclosure sale, and an
extrajudicial foreclosure sale, because a different set of
law applies to each class of sale mentioned. An ordinary
execution sale is governed by the pertinent provisions of
Rule 39 of the Rules of Court. Rule 68 of the Rules of
Court applies in cases of judicial foreclosure sale. On the
other hand, Act No. 3135, as amended by Act No. 4118
otherwise known as An Act to Regulate the Sale of
Property under Special Powers Inserted in or Annexed to
Real Estate Mortgages applies in cases of extrajudicial
foreclosure sale.
The case at bar, as the facts disclose, involves an
extrajudicial foreclosure sale. The public auction sale
conducted on August 6, 1979 by the Provincial Sheriff of
Ilocos Sur refers to the sale mentioned in Section 1 of
Act No. 3135, as amended, which was made pursuant to
a special power inserted in or attached to a real estate
mortgage made as security for the payment of money or
the fulfillment of any other obligation. It must be noted
that in the mortgage contract, petitioners, as mortgagor,
had appointed private respondent DBP, for the purpose of
extrajudi-cial foreclosure, as his attorney-in-fact to sell
the property mortgaged under Act No. 3135, as amended,
to sign all documents and perform any act requisite and
necessary to accomplish said purpose x x x. In case of
foreclosure, the Mortgagor hereby consents to the
appointment of the mortgagee or any of its employees as
receiver, without any bond, to take charge of the
mortgaged property at once, and to hold possession of
the same x x x.
There is no justifiable basis, therefore, to apply by
analogy the provisions of Rule 39 of the Rules of Court on
4

ordinary exe-cution sale, particularly Section 15 thereof

as well as the jurisprudence under said provision, to an
extrajudicial foreclosure sale conducted under the
provisions of Act No. 3135, as amended. Act No. 3135, as
amended, being a special law governing extra-judicial
foreclosure proceedings, the same must govern as
against the provisions on ordinary execution sale under
Rule 39 of the Rules of Court.
In that sense, the case ofAparri v. Court of Appeals,13
SCRA 611 (1965), cited by petitioners, must be
distinguished from the instant case. On the question of
what should be done in the event the highest bid made
for the property at the extrajudicial foreclosure sale is in
excess of the mortgage debt, this Court applied the rule
and practice in a judicial foreclosure sale to an
extrajudicial foreclosure sale in a similar case considering
that the governing provisions of law as mandated by
Section 6 of Act No. 3135, as amended, specifically
Sections 29, 30 and 34 of Rule 39 of the Rules of Court
(previously Sections 464, 465 and 466 of the Code of Civil
Procedure) are silent on the matter. The said ruling
cannot, however, be construed as the legal basis for
applying the requirement of a levy under Section 15 of
Rule 39 of the Rules of Court before an extrajudicially
foreclosed property can be sold at public auction when
none is expressly required under Act No. 3135, as
amended. Levy, as understood under Section 15, Rule 39
of the Rules of Court in relation to execution of money
judgments, has been defined by this Court as the act
whereby a sheriff sets apart or appropriates for the
purpose of satisfying the command of the writ, a part or
the whole of the judgment-debtors property.
In extrajudicial foreclosure of mortgage, the property
sought to be foreclosed need not be identified or set
apart by the sheriff from the whole mass of property of
5

the mortgagor for the purpose of satisfying the mortgage

indebtedness. For, the essence of a contract of mortgage
indebtedness is that a property has been identified or set
apart from the mass of the property of the debtormortgagor as security for the payment of money or the
fulfillment of an obligation to answer the amount of
indebtedness, in case of default of payment. By virtue of
the special power inserted or attached to the mortgage
contract, the mortgagor has authorized the mortgageecreditor or any other person authorized to act for him to
sell said property in accordance with the formalities
required under Act No. 3135, as amended.
The Court finds that the formalities prescribed under
Sections 2, 3 and 4 of Act No. 3135, as amended, were
substantially complied with in the instant case. Records
show that the notices of sale were posted by the
Provincial Sheriff of Ilocos Sur and the same were
published in Ilocos Times, a newspaper of general
circulation in the province of Ilocos Sur, setting the date
of the auction sale on August 6, 1979 at 10:00 a.m. in the
Office of the Sheriff, Vigan, Ilocos Sur.
The nullity of the extrajudicial foreclosure sale in the
instant case is further sought by petitioners on the
ground that the DBP cannot acquire by purchase the
mortgaged property at the public auction sale by virtue of
par. (2) of Article 1491 and par. (7) of Article 1409 of the
Civil Code which prohibits agents from acquiring by
purchase, even at a public or judicial auction either in
person or through the mediation of another, the property
whose administration or sale may have been entrusted to
them unless the consent of the principal has been given.
The contention is erroneous.
The prohibition mandated by par. (2) of Article 1491 in
relation to Article 1409 of the Civil Code does not apply in
the instant case where the sale of the property in dispute
6

was made under a special power inserted in or attached

to the real estate mortgage pursuant to Act No. 3135, as
amended. It is a familiar rule of statutory construction
that, as between a specific statute and general statute,
the former must prevail since it evinces the legislative
intent more clearly than a general statute does. The Civil
Code (R.A. 386) is of general character while Act No.
3135, as amended, is a special enactment and therefore
the latter must prevail.
Under Act No. 3135, as amended, a mortgagee-creditor
is allowed to participate in the bidding and purchase
under the same conditions as any other bidder, as in the
case at bar, thus:
7

Section 5. At any sale, the creditor, trustee, or other person

authorized to act for the creditor, may participate in the
bidding and purchase under the same conditions as any other
bidder, unless the contrary has been expressly provided in the
mortgage or trust deed under which the sale is made.

In other words, Section 5 of Act No. 3135, as amended,

creates and is designed to create an exception to the
general rule that a mortgagee or trustee in a mortgage or
deed of trust which contains a power of sale on default
may not become the purchaser, either directly or through
the agency of a third person, at a sale which he himself
makes under the power. Under such an exception, the
title of the mortgagee-creditor over the property cannot
be impeached or defeated on the ground that the
mortgagee cannot be a purchaser at his own sale.
Needless to state, the power to foreclose is not an
ordinary agency that contemplates exclusively the
representation of the principal by the agent but is
primarily an authority conferred upon the mortgagee for
the latters own protection. It is an ancillary stipulation
supported by the same cause or consideration for the
mortgage and forms an essential and inseparable part of

that bilateral agreement. Even in the absence of

statutory provision, there is authority to hold that a
mortgagee may purchase at a sale under his mortgage to
protect his own interest or to avoid a loss to himself by a
sale to a third person at a price below the mortgage
debt. The express mandate of Section 5 of Act No. 3135,
as amended, amply protects the interest of the
mortgagee in this jurisdiction.
WHEREFORE, in view of the foregoing, the petition is
DENIED for lack of merit and the decision of the Court of
Appeals dated June 20, 1987 is hereby AFFIRMED. No
cost.
SO ORDERED.
Gutierrez,
Jr.,Feliciano, Bidin and Corts,
JJ., concur.
Petition denied. Decision affirmed.
Note.Under Section 17, Rule 39, Rules of Court, a
claimant who does not file a third party claim to the
property being levied upon is not prevented from
vindicating his claims to the property by any other action.
(Pacheco vs. Court of Appeals, 153 SCRA 382.)
9

10

PHILIPPINE
SURETY
&
INSURANCE
petitioner vs. BEATRIZ ZABAL,respondent.

CO.,

INC.,

Executions; Levy
of
attachment; Strict
compliance
respecting manner of carrying out levy.A special statutory
provision respecting the manner of carrying out levy of
attachment must be strictly complied with, and departure
therefrom shall invalidate the levy.
Same; Prerequisites to a valid levy; Effect of noncompliance.To effect a levy upon a realty, the sheriff is
required under Section 7 of old Rule 59 (now Section 7 of
Revised Rule 57), to do two specific things: (1) file with the
register of deeds a copy of the order, description of the
attached property and notice of attachment, and (2) leave with
the occupant of the property copy of the same order,
description and notice. Noncompliance with any of these
prerequisites is fatal.
Same; Same; Purpose
of
law
in
imposing
the
requirements.The evident purpose of the law i n imposing
these requirements is to make the levy public and notorious, to
prevent liens from attaching secretly and by surreptitious
entries and indorsements, and to enable the affected party to
inquire into the date and circumstances surrounding the
creation of the encumbrance, as well as give him ample
opportunity to file timely claims to the property levied upon.
Same; Same; Effect of service of notice on property owner
who is not the occupant; Case at bar.In the case at bar, no
notice of the levy was given to the occupant of the land. There
was, therefore, no valid levy on the land, and its registration in
the registry of deeds and annotation in the title were invalid
and ineffective. The fact that the person in whose name the
land was registered was duly notified of the attachment does
not cure the defect, because personal service of the copy of
the writ, description of the property and notice to the owner,

who is not the occupant, does not constitute compliance with

the statute.

APPEAL by certiorari from a decision of the Court of

Appeals.
The facts are stated in the opinion of the Court.
Ariston J. Oblena for petitioner.
Domingo C. Aquino for respondent.
REYES, J.B.L., J.:
In this petition for review, petitioner Philippine Surety and
Insurance Company, Inc. takes exception from the ruling
of the Court of Appeals (in CA-G. R. No. 31014-R) that
notice to the occupant of a real property is a prerequisite
to a valid levy of execution upon that property, and
reversing the decision of the Court of First Instance of
Manila (in Civil Case No. 49395).
Pursuant to a writ of execution duly issued by the Court
of First Instance of Manila in favor of herein petitioner
surety company to enforce a money judgment against
Amado de la Merced and Candido Fajardo, the solidary
judgment-debtors inCivil Case No. 42056, the Sheriff of
Manila, on June 17, 1960, levied on all the interests and
participation of Candido Fajardo in a parcel of land
registered in his name under TCT No. 21180. Notice of the
levy was duly registered in the register of deeds of
Manila, and annotated in the corresponding title.
On August 28, 1961, Beatriz Zabal presented for
registration a deed of sale dated August 28, 1959,
whereby Candido Fajardo appeared to have conveyed to
her the parcel of land covered by TCT No. 21180.
Thereupon, the Registrar of Deeds cancelled the
certificate in the name of Fajardo and issued in lieu
thereof TCT No. 64730 in the name of Beatriz Zabal. But,
as the notice of levy in favor of the surety company was

carried at the back of the new certificate, Zabal went to

the Court of First Instance of Manila (in Civil Case No.
49395), praying for the cancellation of the annotation, on
the ground that she was already the owner of the land
when it was registered, and that the levy on the property
was irregular and improper.
Therein defendants Philippine Surety & Insurance
Company, the Sheriff of Manila and the Register of Deeds
for Manila, set up as defense the alleged superiority of
the lien, created by the prior registration of the levy, over
the sale in favor of the plaintiff. The trial court thereafter
ruled adversely against the plaintiff and ordered dismissal
of the complaint.
On appeal by the plaintiff to the Court of Appeals,
however, the decision of the trial court was reversed. The
appellate court, ordering the dissolution of the
attachment and the cancellation of the notice of levy at
the back of TCT No. 64730, said:

service
on
its
face
is
unauthorized
and
invalid'
(Hallvs. Stevenson, 19 Or 153, 23 P. 887, 20 Am. St. Rep.
803;Anderson vs. Moline Plow Co., 101 Iowa 747, 69 NW 1028
cited in 4 Am. Jur. Sec. 575, p. 903). Moreover, the required
notice to the defendant debtor under Section 5 of the same
Rule has been held essential to the validity of an attachment
lien; so where the return of the sheriff shows that this step was
not taken, the attachment is invalid and no lien in favor of the
attachment creditor is acquired thereby (Philippine National
Bank vs. Atiles, 58
Phil.
240,
253; cf. Chua
Hermanos vs. Register of Deeds of Batangas, 50 Phil. 670;
674). It results that the notice to the occupant is essential to
the validity of the attachment, non-compliance with which
renders the attachment invalid and ineffective particularly to
herein plaintiff who was in possession as vendee.

"x x x the rule (that registration of an attachment makes it

superior to a prior unregistered sale) presupposes a valid levy
and plaintiff challenges the efficacy of the levy. She testified
without contradiction that she has been in occupation of the
property even prior to the sale on August 28, 1958 and
particularly June 17, 1960 when the levy was made, yet she
was not served a copy of the notice of levy, order or
attachment and description of the property, in violation of the
requirements of Section 7 (a) of Rule 59. A proceeding by
attachment being in derogation of the common law, the officer
must comply with the statutes in making the levy. Under a
statute similar to Section 7(a), Rule 59, it has been held that
failure to comply with such a requirement is fatal to the validity
of the levy (Schwarts vs. Cowell, 12 P. 252, 71 Cal.
306; Fountain vs. 624 Pieces Timber, 140 Fed. 381; 6 CJ p. 234
Sec. 443 nn 9 & 10). Otherwise stated, service on the
occupant, if any 'must appear from the return or else the

SEC. 7. How various classes of real and personal property

attached; duty of registrar of deeds.The property of the
defendant shall be attached by the officer executing, the order
in the following manner:

Section 7 of old Rule 59 (now Sec. 7 of Revised Rule 57),

prescribes the procedure or mode of effecting an
attachment, thus:

(a) Real property, or growing crops thereon, standing upon

the records of the registrar of deeds of the province in the
name of the defendant, or not appearing at all upon such
records, by filing with the registrar of deeds a copy of the
order, together with a description of the property attached,
and a notice that it is attached, and by leaving a copy of such
order, description, and notice with the occupant of the
property, if any there be. Where the property has been brought
under the operation of the Land Registration Act, the notice
shall contain a reference to the number of the certificate of
title and the volume and page in the registration book where
the certificate is registered. The registrar must index

attachments filed under this paragraph in the names both of

the plaintiff and of the defendants. (Italics supplied.)

mandatory as to the essence of the thing to be done. (Lewis

Sutherland on Statutory Construction, 2d ed., see. 627.)

To effect a levy upon a realty, the sheriff is required to do

two specific things: (1) file with the register of deeds a
copy of the order, description of the attached property
and notice of attachment, and (2) leave with the
occupant of the property copy of the same order,
description and notice. These are prerequisites to a valid
levy, non-compliance with any of which is fatal. For the
weight of authority is to the effect that a special statutory
provision, respecting the manner of carrying out levy of
attachment, must be strictly complied with, and
departure therefrom shall invalidate the levy. Thus,
inLlenares vs. Valdeavilla and Zoreta, 46 Phil. pp. 358,
360, 361, this Court said:

After quoting the provisions of section 429 of Act 190,

similar to that of the Rules heretofore quoted, this Court
proceeded to rule:

The levy of an execution is defined as the acts by which an

officer sets apart or appropriates for the purpose of satisfying
the command of the writ, a part or the whole of a judgment
debtors property. In the absence of statutory provisions no
special formalities are required for a valid levy, and in regard
to real property it has usually been held sufficient if the seizure
of the property is made known to the occupants thereof and
endorsed on the writ. But it is otherwise where, as in this
jurisdiction, the matter is regulated by statute; there a
substantial compliance with the statute is indispensable.

Registration of levy was also declared invalid where the

Sheriffs notice did not contain a reference to the number
of the certificate of title covering the levied pro perty, the
volume and page in the registry book where the title is
registered, or where the notice was not accompanied by
a copy of the order of attachment.
The evident purpose of the law in imposing these
requirements is to make the levy public and notorious, to
prevent liens from attaching secretly and by surreptitious
entries and indorsements, and to enable the affected
party to inquire into the date and circumstances
surrounding the creation of the encumbrance, as well as
to give him ample opportunity to file timely claim to the
property levied upon.
Since the Court of Appeals, in this case, found that no
notice of the levy was given to respondent who was then
in occupancy of the landa factual finding which we
cannot now reviewit is obvious that there was no valid
levy on the land, and, therefore, its registration in the
registry of deeds and annotation in the title were also

The statutory provisions to this case are found in sections

450 and 429 of the Code of Civil Procedure. Section 450 states
that property may be attached on execution in like manner as
upon writs of attachment. This provision while permissive in
form must, nevertheless, be regarded as mandatory. No other
method of effecting the levy is prescribed and it is an old rule
that powers through the exercise of which a person may be
divested of his property are always strictly construed and that
the provisions regulating the procedure in their exercise are

In the present case it is admitted by the plaintiff that notice

of attachment for the execution was not filed with the registrar
of deeds and that there was no copy thereof served on the
defendants. It is therefore clear that the attempted levy was
not made in accordance with the provisions of the statute, and,
according to the great weight of authority, a proper levy is
indispensable to a valid sale on execution. A sale unless
preceded by a valid levy, is void, and the purchaser acquires
no title. (Leath vs. Deweese, 162 Ky., 227; Jarboe vs. Hall, 37
Md., 345.)

invalid and ineffective. Petitioners case is not even

helped by the allegation that Fajardo, in whose name the
land was registered was duly notified of the attachment.
Where notice to the occupant is required by law for the
validity of a levy, personal service of the copy of the writ,
description of the property and notice to the owner, who
is not the occupant, does not constitute compliance with
the statute.
There being no valid levy nor sale thereunder, the
quesr tion of priority of rights between the parties does
not really arise.
In view of the conclusion thus reached on the main
issue, there is no necessity to pass upon the nature and
character of the deed of sale executed by Candido
Fajardo in favor of respondent, which is also here assailed
by petitioner. The issue was not raised in the Courts
below.
WHEREFORE, finding no error in the decision under
review the petition is hereby dismissed, with costs
against petitioner. So ordered.
Concepcion,
CJ.,Dizon, Makalintal, Bengzon,
J.P., Zaldivar, Sanchez,Castro, Angeles andFernando,
JJ., concur.
Petition dismissed.
5

SPOUSES FELIPE and VICTORIA LAYOS, petitioners, vs. FILESTATE GOLF AND DEVELOPMENT, INC., LA PAZ HOUSING
AND DEVELOPMENT CORPORATION, REPUBLIC OF THE
PHILIPPINES, AND THE SPOUSES MARINA AND GENEROSO
OTIC, respondents.
Judgments; Res Judicata; Words and Phrases; Res judicata
means a matter adjudged; a thing judicially acted upon or
decided; a thing or matter settled by judgment.Res
judicata literally means a matter adjudged; a thing judicially
acted upon or decided; a thing or matter settled by
judgment. Res judicata lays the rule that an existing final
judgment or decree rendered on the merits, and without fraud
or collusion, by a court of competent jurisdiction, upon any
matter within its jurisdiction, is conclusive of the rights of the
parties or their privies, in all other actions or suits in the same
or any other judicial tribunal of concurrent jurisdiction on the
points and matters in issue in the first suit.
Same; Same; Two main rules of res judicata, stated.The
doctrine of res judicata lays down two main rules which may
be stated as follows: (1) The judgment or decree of a court of
competent jurisdiction on the merits concludes the litigation
between the parties and their privies and constitutes a bar to a
new action or suit involving the same cause of action either
before the same or any other tribunal; and (2) any right, fact,
or matter in issue directly adjudicated or necessarily involved
in the determination of an action before a competent court in
which a judgment or decree is rendered on the merits is
conclusively settled by the judgment therein and cannot again
be litigated between the parties and their privies whether or
not the claims or demands, purposes, or subject matters of the
two suits are the same. These two main rules mark the
distinction between the principles governing the two typical
cases in which a judgment may operate as evidence. In
speaking of these cases, the first general rule above stated,

and which corresponds to the afore-quoted paragraph (b) of

Section 47, Rule 39 of the Rules of Court, is referred to as bar
by former judgment; while the second general rule, which is
embodied in paragraph (c) of the same section and rule, is
known as conclusiveness of judgment.
Same; Same; Conclusiveness of judgment bars the relitigation in a second case of a fact or question already settled
in a previous case.In sum, conclusiveness of judgment bars
the re-litigation in a second case of a fact or question already
settled in a previous case. The second case, however, may still
proceed provided that it will no longer touch on the same fact
or question adjudged in the first case. Conclusiveness of
judgment requires only the identity of issues and parties, but
not of causes of action. It is on the ground of res judicata, in its
second conceptconclusiveness of judgmentthat the Petition
for Reconstitution of the Spouses Layos must be dismissed.
Same; Same; Parties; The Court has previously held that
for purposes of res judicata, only substantial identity of parties
is required and not absolute identity.The principal parties in
both cases are the Spouses Layos, on one hand, and La Paz
and FEGDI, on the other. The Spouses Layos and La Paz both
claim title to the subject property, while FEGDI is the partner of
La Paz in a joint venture to develop the said property. There
may be other parties named in both cases, but these parties
only derive their rights from the principal parties. The Court
has previously held that for purposes of res judicata, only
substantial identity of parties is required and not absolute
identity. There is substantial identity of parties when there is
community of interest between a party in the first case and a
party in the second case even if the latter was not impleaded
in the first case. In other words, privity or a shared identity of
interest is sufficient to invoke application of the principle ofres
judicata. It is fundamental that the application of res
judicata may not be evaded by simply including additional
parties in a subsequent litigation. For conclusiveness of

judgment, identity of causes of action and subject matter is

not required; it is the identity of issues that is material. The
issue of the validity of the Spouses Layos title to the subject
property is integral to both G.R. No. 120958 and LRC Case No.
B-1784.
Land Titles; Torrens Systems; Republic Act No. 26 provides
for a special procedure for the reconstitution of Torrens
certificates of title that are missing but not fictitious titles or
titles, which are existing.Reconstitution or reconstruction of a
certificate of title literally and within the meaning of Republic
Act No. 26 denotes restoration of the instrument which is
supposed to have been lost or destroyed in its original form
and condition. For an order of reconstitution to issue, the
following elements must be present: 1) the certificate of title
has been lost or destroyed; 2) the petitioner is the registered
owner or has an interest therein; and 3) the certificate of title
is in force at the time it was lost or destroyed. While G.R. No.
120958 does not bar the institution of LRC Case No. B-1758,
the pronouncement of invalidity of OCT No. 239 by this Court
in G.R. No. 120958 is conclusive upon the San Pedro RTC in LRC
Case No. B-1758, precluding it from relitigating the same issue
and ending up with a contrary ruling. Since the Court already
settled in G.R. No. 120958 that OCT No. 239 is fake and a
forgery, it would have been a senseless and futile endeavor for
the San Pedro RTC to continue with the reconstitution
proceedings in LRC Case No. B-1758, for there is actually no
valid certificate to reconstitute. The court cannot, and should
not, reconstitute a spurious certificate of title and allow the
continuous illegal proliferation and perpetuation thereof.
Republic Act No. 26 provides for a special procedure for the
reconstitution of Torrens certificates of title that are missing
but not fictitious titles or titles, which are existing.
Judgments; Nothing is more settled in law than that when
a final judgment is executory; it thereby becomes immutable
andunalterable.Nothing is more settled in law than that when

a final judgment is executory; it thereby becomes immutable

and unalterable. The judgment may no longer be modified in
any respect, even if the modification is meant to correct what
is perceived to be an erroneous conclusion of fact or law, and
regardless of whether the modification is attempted to be
made by the court rendering it or by the highest Court of the
land. The doctrine is founded on considerations of public policy
and sound practice that, at the risk of occasional errors,
judgments must become final at some definite point in time.
Same; Collateral Estoppel; Under the doctrine of
conclusiveness of judgment which is also known as preclusion
of issues or collateral estoppel, issues actually and directly
resolved in a former suit cannot again be raised in any future
case between the same parties involving a different cause of
action.Under the doctrine of conclusiveness of judgment
which is also known as preclusion of issues or collateral
estoppel, issues actually and directly resolved in a former suit
cannot again be raised in any future case between the parties
involving a different cause of action. Once a judgment attains
finality it becomes immutable and unalterable. It may no
longer be modified in any respect, even if the modification is
meant to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether the
modification is attempted to be made by the court rendering it
or by the highest court of the land.
Due Process; Due process does not require that a trial be
held in all circumstances.Due process does not require that a
trial be held in all circumstances. This Court, in a Resolution
dated 18 November 2003 in Republic v. Sandiganbayan, 416
SCRA 133 (2003), elucidated that: The words hearing and
trial have different meanings and connotations. Trial may
refer to the reception of evidence and other processes. It
embraces the period for the introduction of evidence by both
parties. Hearing, as known in law, is not confined to trial but
embraces the several stages of litigation, including the pre-trial

stage. A hearing does not necessarily mean presentation of

evidence. It does not necessarily imply the presentation of oral
or documentary evidence in open court but that the parties are
afforded the opportunity to be heard.
Land Titles; Lands already covered by valid titles in the
name of registered owners other than the petitioners cannot
be a proper subject of reconstitution proceedings.The RTC,
acting on a petition for reconstitution, is of limited jurisdiction.
Lands already covered by valid titles in the name of registered
owners other than the petitioners cannot be a proper subject
of reconstitution proceedings, thus: The Court stresses once
more that lands already covered by duly issued existing
Torrens Titles (which become incontrovertible upon the
expiration of one year from their issuance under Section 38 of
the Land Registration Act) cannot be the subject of petitions
for reconstitution of allegedly lost or destroyed titles filed by
third parties without first securing by final judgment the
cancellation of such existing titles. (And as the Court reiterated
in the recent case ofSilvestre vs. Court of Appeals, in cases of
annulment and/or reconveyance of title, a party seeking it
should establish not merely by a preponderance of evidence
but by clear and convincing evidence that the land sought to
be reconveyed is his.) The courts simply have no
jurisdiction over petitions by such third parties for
reconstitution of allegedly lost or destroyed titles over
lands that are already covered by duly issued
subsisting titles in the names of their duly registered
owners. The very concept of stability and indefeasibility
of titles covered under the Torrens System of
registration rules out as anathema the issuance of two
certificates of title over the same land to two different
holders thereof.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.

Nelson Clemente for petitioners.

Poblador, Bautista andReyes for respondent Fil-Estate
Golf Development, Inc.
Ramon Casanova for respondent La Paz Housing
Development Corporation.
Gerardo Wilfredo L. Alberto for intervenor Norma
Saavedra.
CHICO-NAZARIO,J.:
Before this Court is a Petition for Review
onCertiorari1 under Rule 45 of the Rules of Court filed by
petitioner-spouses Felipe and Victoria Layos (Spouses
Layos) seeking the reversal and setting aside of the
Decision2 dated 26 April 2001 of the Court of Appeals in
CA-G.R. CV No. 61759, which affirmed the Order 3dated 19
January 1998 of the Regional Trial Court (RTC), Branch 93
of San Pedro, Laguna, summarily dismissing the spouses
Layos Petition for Reconstitution of Original Certificate of
Title (OCT) No. 239 in LRC Case No. B-1784. Likewise
being assailed in the Petition at bar is the
Resolution4 dated 18 October 2001 of the appellate court
denying the Spouses Layos Motion for Reconsideration of
its earlier Decision.
The factual and procedural antecedents of the case
presently before this Court, by themselves, appear
deceptively simple. However, they are so intimately
linked with other cases the factual backgrounds and
judicial resolutions of which the Court must also
necessarily present herein.
I
FACTUAL BACKGROUND
G.R.
No.
The Injunction Cases

120958:

The Court begins withFil-Estate Golf and Development,

Inc. v. Court of Appeals,5 a case which it decided more
than a decade ago. The said case arose from the
following facts:
Petitioner Fil-Estate Golf & Development, Inc. (FEGDI) is the
developer of the Manila Southwoods golf course and residential
subdivision project which partly covers lands located in Bian,
Laguna. Its partner in the joint venture, La Paz Housing and
Development
Corporation
(La
Paz),
provided
the
aforementioned properties which are registered in its name.
The project involves the construction and development of,
among others, a highway interchange linking nearby
communities to the South Expressway and world class tourismgenerating cultural theme and water parks.
On 29 December 1992, a certain Felipe Layos filed a
complaint for Injunction and Damages with Application for
Preliminary Injunction against Fil-Estate Realty Corporation,
(FERC) et al. with the Regional Trial Court of Bian, Laguna and
docketed as Civil Case No. B-3973.
It was alleged in the said complaint that Felipe Layos is the
legal owner and possessor of two (2) parcels of land having a
total area of 837,695 square meters located at Barrio Tubigan,
Bian, Laguna, known as Lots 1 & 2 of Plan Psu-201 of the
Bureau of Lands having acquired the same from his father,
Mauricio Layos, who in turn inherited said properties from his
own father, Natalio Layos, allegedly the original owner thereof.
Layos claimed that the Southwoods project encroached upon
the aforecited lands and thus contended that his rights of
ownership and possession were violated when FERC brought in
men and equipment to begin development of the said
properties.
On 2 February 1993, FERC filed an Opposition to Application
for Writ of Preliminary Injunction and explicitly stated therein
that the developer of the Southwoods project is its sister
company, FEGDI.

On 5 March 1993, FEGDI filed an Answer to the

abovementioned complaint and reiterated that it is the
developer of the Southwoods project and not FERC and that
the land covered by the project is covered by Transfer
Certificates of Title in the name of La Paz, copies of which were
attached to said answer as annexes.
On 29 March 1993, Presiding Judge Justo M. Sultan of the
Regional Trial Court of Bian, Laguna issued an order denying
the prayer for preliminary injunction in Civil Case No. B-3973 in
view of the inability of Layos to substantiate his right. Neither
he nor his counsel appeared on the scheduled hearings. x x x
xxxx
On 25 June 1993, Felipe Layos along with his wife and other
individuals filed another case for Injunction and Damages with
Prayer for Preliminary Injunction with the Regional Trial Court of
San Pedro, Laguna docketed as Civil Case No. B-4133, this time
against the correct party, FEGDI.
The complaint in the San Pedro case (Civil Case No. B-4133)
is basically identical to that filed in the Bian case (Civil Case
No. B3973), except for changes in the number of partyplaintiffs and party-defendants and in the area size of the
claimed landholdings. Further, in the San Pedro case there is
reference to a title (OCT No. 239), a specific date of intrusion
and an increase in the damages prayed for.
On 1 July 1993, FEGDI moved to dismiss the San Pedro case
on grounds of litis pendentia, forum-shopping, lack of cause of
action and lack of jurisdiction. FEGDI argued that a similar
complaint was previously filed with the Regional Trial Court of
Bian, Laguna and is currently pending therein. It, likewise,
accused the private respondents of forum-shopping, stating
that the latter instituted the San Pedro case after their
application for preliminary injunction was denied by the Bian
court. Anent the third and fourth grounds, FEGDl averred that
the documents relied upon by the private respondents are of
doubtful veracity and that they failed to pay the correct filing

fees considering that the San Pedro case is a real action as

allegedly revealed in the body of the complaint. The Layoses
filed their opposition on 5 July 1993 arguing in the main that
there is no litis pendentia because there is no identity of
parties. Felipe Layos claimed that he never authorized the
filing of the Bian case and that the defendant therein is the
Fil-Estate Realty Corporation not the Fil-Estate Golf &
Development, Inc. Consequently, the two cases being
dissimilar, there can be no forum-shopping. Private
respondents contended, likewise, that they have satisfied all
the requirements of a valid cause of action and insisted that
the suit is not for recovery of possession but is a personal
action for injunction and damages. On 12 July 1993, Judge
Stella Cabuco-Andres of the San Pedro Regional Trial Court
issued an order denying FEGDIs motion to dismiss. The Motion
for Reconsideration filed by FEGDI on 13 July 1993 was
similarly denied by the aforesaid court in an order dated 14
July 1993.
On 15 July 1993, FEGDI filed a Petition for Certiorari and
Prohibition with Application for Preliminary Injunction with the
Court of Appeals (docketed as CA-G.R. SP No. 31507) assailing
the denial of its motion to dismiss the San Pedro case. The
arguments and issues raised by petitioner to support its
motion to dismiss were the same issues raised in the
aforestated petition.
On 20 July 1993, the Court of Appeals issued a temporary
restraining order enjoining Judge Andres from proceeding with
the San Pedro case.
Meanwhile, the Regional Trial Court of Bian, Laguna, in an
order dated 25 January 1994, dismissed the Bian case without
prejudice on grounds of forum-shopping. FEGDI moved for a
partial reconsideration of the said order praying that the
dismissal be with prejudice. Hence, on 25 April 1994, the
aforestated court dismissed the Bian case with prejudice to
forestall the plaintiffs therein from forum-shopping. x x x.

xxxx
On 10 March 1995, the Court of Appeals, dismissed FEGDIs
petition for lack of merit. x x x.
FEGDIs motion for reconsideration was subsequently
denied in the Court of Appeals resolution dated 13 July 1995.
Hence, this petition for review.
6

FEGDI came to this Courtvia a Petition for Review

onCertiorari under Rule 45 of the Rules of Court, docketed
as G.R. No. 120958. The Court granted the Petition and
ruled in favor of FEGDI.
The Court found that therein private respondents,
which included the Spouses Layos, did commit forum
shopping by instituting similar proceedings for injunction
before the RTCs of Bian and San Pedro, Laguna:
Private respondents have indeed resorted to forumshopping in order to obtain a favorable decision. The familiar
pattern (of one partys practice of deliberately seeking out a
sympathetic court) is undisputedly revealed by the fact that
after Felipe Layos instituted in 1992 a case for injunction and
damages with application for preliminary injunction in the
Regional Trial Court of Bian, Laguna and after his prayer for a
preliminary injunction was denied in March 1993, he and his
wife, together with four (4) alleged buyers of portions of the
land claimed by him, filed an identical complaint for injunction
and damages with preliminary injunction a few months later,
or in June 1993, this time with the Regional Trial Court of San
Pedro, Laguna.
Having been denied their temporary restraining order in one
court, private respondents immediately instituted the same
action in another tribunala deliberate tactic to seek out a
different court which may grant their application for
preliminary injunction, or at least give them another chance to
obtain one.

Private respondents parry petitioners allegation of forum

shopping by adamantly contending that Felipe Layos did not,
in any manner, authorize the filing of the Bian case.
Moreover, they insist that Felipe Layos signature in the Bian
complaint is a forgery and that he neither appeared nor
participated in the proceedings before the Bian court.
We find no merit in private respondents assertions. The
almost word-for-word similarity of the complaints in both the
Bian and San Pedro cases totally refutes such a theory, as can
readily be observed from a comparative view of the two
aforementioned complaints x x x.
xxxx
Even the affidavits attached to the two complaints are
virtually identical x x x
xxxx
Examining the two complaints one can easily discern that
the San Pedro complaint is simply an improved version of the
Bian complaint and the similarity does not end there. The
residence certificates (of Felipe Layos) used in the verification
of both complaints are practically identicalsame number,
date of issue and place of issue.
If indeed there is a ghost Mr. Layos, as claimed by the
private respondents, the genuine Felipe Layos and the rest of
the private respondents should have, on their own volition,
denounced the allegedly bogus case filed with the Bian court
or at the very least, informed the San Pedro court about it. It
cannot be denied that private respondents were aware of the
Bian case considering that Annex C (Affidavit of SelfAdjudication with Sale) of the San Pedro complaint was a mere
photocopy of Annex B of the Bian complaint.
Private respondents likewise aver that there is no identity of
party-defendants in view of the fact that the defendant in the
Bian case is the Fil-Estate Realty Corporation (FERC) and in

the San Pedro case the Fil-Estate Golf and Development, Inc.
(FEGDI), two completely separate and distinct entities.
Private respondents contention is unmeritorious. In the Bian
case, FEGDI voluntarily submitted to the courts jurisdiction by
filing its answer and expressly stating therein that it is the
developer of Southwoods, and not its sister company, FERC.
Moreover, the Bian court in its orders dated 25 January 1994
and 20 October 1994 expressly recognized FEGDI as the
defendant in the said case. There can be no question then that
in both cases FEGDI is the true party-defendant.
As clearly demonstrated above, the willful attempt by
private respondents to obtain a preliminary injunction in
another court after it failed to acquire the same from the
original court constitutes grave abuse of the judicial process.
Such disrespect is penalized by the summary dismissal of both
actions as mandated by paragraph 17 of the Interim Rules and
Guidelines issued by this Court on 11 January 1983 and
Supreme Court Circular No. 28-91. x x x
xxxx
The rule against forum-shopping is further strengthened by
the issuance of Supreme Court Administrative Circular No. 0494. Said circular formally established the rule that the
deliberate filing of multiple complaints to obtain favorable
action constitutes forum-shopping and shall be a ground for
summary dismissal thereof x x x.
7

The Court further pronounced that the Complaint in the

San Pedro case did not state a cause of action. Taking into
consideration the Complaint itself and its attached
annexes, as well as the other pleadings submitted by the
parties, the Court found that:
In the San Pedro complaint, private respondents anchored
their claim of ownership on an OCT No. 239 and on a survey
plan Psu-201 in the name of Natalio Layos, copies of which
were attached to the complaint. His son and sole heir Mauricio

Layos inherited the properties covered by the said plan. In

turn, Felipe Layos became the owner thereof through an
Affidavit of Self-Adjudication with Sale executed by Mauricio
Layos, his father. This is where the inconsistency materializes.
In the said Affidavit of Self-Adjudication with Sale which was
also attached to the San Pedro complaint as Annex C,
Mauricio Layos categorically stated that the subject properties
(Lots No. 1 and 2 of Plan PSU-201) were not registered under
the Spanish Mortgage Law or under the Property Registration
Decree. If the properties in question were not registered,
where did the OCT No. 239 come from? Mauricio Layos
express admission not only contradicts but indubitably strikes
down the purported OCT No. 239 and exposes private
respondents claim as a sham. This inconsistency is patent in
the documents attached to the complaint which form part and
parcel of the complaint. The Affidavit of Self-Adjudication with
Sale attached to the complaint is the crucial and indispensable
basis for private respondents claim of ownership and interest
in the subject properties, without which they have no right of
action or personality in the case. Necessarily, the Affidavit of
Self-Adjudication is a vital part of the complaint that should be
considered in the determination of whether or not a cause of
action exists.
Private respondents inconsistency is further manifested by
the 1992 application for original registration filed by Mauricio
Layos with the Regional Trial Court of Bian, Laguna (docketed
as Civil Case No. B-542) for the lots under Plan Psu-201. Why
would Mauricio Layos file an application for the registration of
the land claimed by him if it is already covered by OCT No.
239? The conclusion is inescapable that the document is fake
or a forgery.
Finally, private respondents cause of action against
petitioner is defeated by the findings of Mr. Privadi Dalire, Chief
of the Geodetic Surveys Division of the Bureau of Lands,
contained in his letters to the Regional Technical Director of the

Department of Environment and Natural Resources (DENR),

Region IV dated 12 November 1992 and 15 December 1992,
respectively:
12 November 1992
The
Regional
Technical
DENR,
Region
IV,
1515
Roxas Boulevard. Manila
ATTN.:

Engr.
ROBERT
OIC, Surveys Division

Director
L
&
C.

of
S

Lands
Building

PANGYARIHAN

Sir:
In connection with your request to validate the white print
copy of an alleged plan Psu-201 which you had issued and
certified that it is a copy of the tracing cloth of Psu-201 which
is on file in that Office, please forward to us the tracing cloth
plan to be examined instead of the white print copy that you
have issued in accordance with the procedure stated in DENR
Administrative Order regarding validation of plans other than
the original copies being sent to the region office. It may be
worthwhile to state for your information that the plan Psu-201
is not among those officially enrolled into the file of
this Bureau. What is more confusing is that the inventory book
of all plans that were recovered after the war shows that Psu201 is a survey for J. Reed covering a piece of land in Malate,
Manila but the plan that was salvaged was heavily damaged
and therefore it was not also microfilmed. This would require
therefore a more exhaustive research regarding the
authenticity of the tracing cloth that is in your file. (Italics
ours.)
Very truly yours,
For
the
Director
(SGD.)
PRIVADI
Chief, Geodetic Surveys Division
xxx
MEMORANDUM:

of
J.G.

Lands:
DALIRE

15 December 1992
FOR:

The
Regional
Technical
The
Chief,
Regional
DENR,
L
&
S
Building,
Manila

Director
of
Lands
Surveys
Division
Region
IV
Roxas
Boulevard

white print of Psu-201 should therefore be subjected to ocular

inspection.

FROM: L M B

Our records of inventory of approved plans show Psu-201 as a

survey of J. Reed covering a piece of land in Malate, Manila.
That plan was heavily damaged and its reconstruction was not
finalized. This should be included in the investigation. (Italics
ours.)

SUBJECT: Psu-201

For the Director of Lands:

Records show that the region furnished us a white print copy

certified by Engr. Robert Pangyarihan to have been prepared
from a tracing cloth plan on file in the NCR for validation. We
returned the white print plan prepared by Engr. Pangyarihan
because we should examine the tracing cloth plan and it is
the tracing cloth plan, white prints and photographic copies
sent by the Central Records Division to be returned to LMB for
validation by this Division.

(SGD.)
PRIVADI
Chief, Geodetic Surveys Division.

In the letter dated 27 November 1992, Engr. Pangyarihan

explained that he prepared the copy which he certified from a
white print plan on file in the region as the applicant claims to
have lost the tracing cloth. While the explanation may be
considered, yet the preparation of the plan is not yet in
accordance with Section 1.3 and 4.3 of DENR Administrative
Order No. 49, s-1991 which requires that the white prints or
photographic print of the plan other than the original plan
which have been decentralized must first be authenticated by
this Bureau before a certified true copy is issued by the region.
It is evident therefore that the issuance of a certified true copy
of Psu-201 from a white print is premature, and considered
voidab initio.
Consider also that if the record of the Bureau is different from
the print copy is subjected to field ocular inspection of the land
and on the basis of the findings, the region may reconstruct
the plan to be approved as usual. Certified copies may now be
issued based on the reconstructed and approved plan. The

J.G.

DALIRE

Consequently, Mr. Sidicious F. Panoy, the Regional Technical

Director of DENR, Region IV, issued an order dated 5 May 1994
cancelling all copies of plans pertaining to Psu-201. The order
states that:
IN RE:

CANCELLATION ORDER:
Plan Si-14769

True copy of Plan

Si- 14779 and Psu-201

Claimant - Sofronio Olano

Brgy Bukal ng Tala & Hasaan
Municipality of Ternate, Cavite
Area: 13,321,977 sq. m.
Plan Psu-201
Claimant - Natalio Layos
Brgy. Tubigan, Bian, Laguna
Area: 837,695 sq. m.
ORDER

By way of reaction to a number of inquiries as to the status

of plans Si-14769 and Psu-201, verification was made at the
Technical Reference Section of the Land Management Bureau,
Escolta, Manila as to the authenticity thereof on the basis of
still recoverable records and the following facts were
established, to wit:

1.That Psu-201 is an original survey for J Reed located in

Malate, Manila; and
2.That Si-14769 is a survey number for the plan of a land
parcel situated in Bo. Bessang, Municipality of Allacapang,
Province of Cagayan in the name of Gregorio Blanco.
The purported blue print plan of Psu-201 indicating the land
covered thereby to be situated in Bo. Tubigan, Bian, Laguna
and claimed by Natalio Layos and comprising 837,695 sq.
meters is, therefore, a spurious plan and, probably the result
of a manipulative act by scheming individuals who
surreptitiously got it inserted in the records. The same can be
said as to the blue print of Si-14769 which is a plan
purportedly covering a parcel of land situated in Bo. Bukal ng
Tala and Hasaan, Ternate, Cavite comprising 13,321,977 sq.
meters. (Italics ours.)
WHEREFORE, in view of the foregoing, all plans pertaining to
the above and indicated as true copies and bearing the
signature of Engr. Robert C. Pangyarihan are as hereby IT IS
CANCELLED including any document attached thereto and, as
such, declared null and void and of no force and effect.
SO ORDERED.
5 May 1994.
(SGD.) SIDICIOUS F. PANOY
Regional Technical Director
It is quite evident from the foregoing findings on record that
private respondents claim of ownership is totally baseless.
Plan Psu-201 pertains to land located in Malate, Manila and
said survey plan was made for a certain J. Reed.
In the case at bar, the technical rules of procedure
regarding motions to dismiss must be applied liberally lest
these very same rules be used not to achieve but to thwart
justice.
8

Consequently, on the grounds of forum shopping and

lack of cause of action, the Court decreed in G.R. No.
120958 as follows:
WHEREFORE, premises considered, the petition for review
on certiorari is hereby GRANTED. Private respondents
complaint docketed as Civil Case No. B-4133 is hereby
DISMISSED.
9

In a Resolution dated 19 February 1997, the Court

refused to reconsider its afore-quoted Decision and
dismissed with finality G.R. No. 120958.
CA-G.R.
CV
No.
50962:
The Quieting of Title Case
On 12 August 1993, only months after instituting the
injunction cases before the RTCs of Bian and San Pedro,
Laguna, and during the pendency of said cases, the
Spouses Layos filed with the Bian RTC a Complaint10 for
Quieting of Title and/or Declaration of Nullity/Annulment
of Title with Damages, against La Paz and the Register of
Deeds of the Province of Laguna, docketed as Civil Case
No. B-4194.
According to the Complaint, Felipe Layos grandfather,
Natalio Layos, was the original owner and lawful
possessor of two parcels of land (subject property) with a
total land area of 1,068,725 square meters, more or less,
situated in Barrio Tubigan, Bian, Laguna, known as Lots
1 and 2 of Plan Psu-201 of the Bureau of Lands. The
subject property is covered by OCT No. 239 in the name
of Natalio Layos. Upon the death of Natalio Layos, his
son, Mauricio Layos, inherited the subject property. On 15
April 1992, Mauricio Layos executed an Affidavit of SelfAdjudication with Sale by which he sold the subject
property to his son, Felipe Layos, and the latters wife,
Victoria
Layos.
The
Spouses
Layos
and
their
predecessors-in-interest had exercised their right of
ownership by being in open, continuous, adverse, and

peaceful possession of the subject property for more than

80 years, even before Plan Psu-201 was approved by the
Bureau of Lands. The subject property had also been
declared for taxation purposes with an assessed value of
P555,737.00.
The Complaint further alleged that in 1992 and 1993,
La Paz, in conspiracy with other persons, entered the
subject property and started developing the same without
the consent of the Spouses Layos. The Spouses Layos
then discovered that La Paz had in its name 19 Transfer
Certificates of Title (TCTs) which encroached upon
portions of the subject property. The TCTs of La Paz were
derived from OCT No. 242, which was issued on 9 August
1913, or 14 days after OCT No. 239 was issued on 30 July
1913 in the name of Natalio Layos. Since OCT No. 239
was older or issued earlier than OCT No. 242, the Spouses
Layos asserted that their title under OCT No. 239 was
indefeasible against any other title issued subsequent to
it, such as OCT No. 242 and the TCTs of La Paz derived
and issued from the latter.
Contending that the TCTs of La Paz, although void ab
initio, put a cloud over their title to and ownership and
possession of the subject property, the Spouses Layos
primarily prayed that the said TCTs be declared null and
void and be accordingly cancelled in order to quiet their
title.
In their Answer, La Paz and the Register of Deeds
denied the allegations in the Spouses Layos Complaint,
and countered:
21.That [Spouses Layos] have
possessed the land in question.

never

owned

nor

22.That the Original Certificates of Title No. 239

purportedly issued by the Register of Deeds on November
18, 1913, in the name of Natalio Layos, does not exist in
the files of the Registry of Deeds of Laguna.

23. That Decree No. 7663 dated July 12, 1912, GLRO
Record No. 7733 from whence OCT No. 239 appears to have
emanated from likewise does not exist in the records of the
Land Registration Authority.
24.That records of Plan PSU-201 are still extant in the
Bureau of Lands but it is not in the name of Natalio Layos,
but in name of another person nor, is the land covered
thereby situated in Laguna.
25.That the certified technical data of Lot Nos. 1 and 2,
PSU-201, marked as Annex D attached to the Complaint
was issued on the basis of records that do not exist in the
files of the Lands Office.
26.That in the Affidavit of Self-Adjudication with Sale
dated April 15, 1992, marked as Annex C attached to the
Complaint, there is an admission in the third paragraph by
Mauricio Layos to the following effect:
Which parcels of land are not registered under the Spanish
Mortgage Law nor the Property Registration Decree.[]
27.That the [Spouses Layos] alleged predecessor,
Mauricio Layos, filed an application for registration of the
same land on October 5, 1992, with this Honorable Court
docketed as LRC No. RTC-B-542, which act amounts to an
admission that the [Spouses Layos] and their predecessorsin-interest have no title to the land.
28.That OCT No. 239 surfaced only when the [Spouses
Layos] themselves filed a petition for reconstitution of their
alleged OCT No. 239 with this Honorable Court on August
11, 1993 (sic), which has been docketed as LRC Case No. B1784.
29.That it is [La Pazs] Certificates of Titles [sic] that are
real, genuine and subsisting, and the originals thereof are
extant in the files of the Registry of Deeds of Laguna.

30.That [La Paz] acquired ownership of these lands from

various registered owners from 1982 to 1988 for valuable
consideration.
31.That the lands form part of what used to be called the
Bian Friar Land estate which the government purchased
from Spanish Religious Orders, and later subdivided and
resold at cost to qualified applicants pursuant to Act No.
1120, otherwise known as the Friar Land Act, and which
have fallen finally into the hands of [La Paz] after a
succession of transfers.
32.That under Act No. 496, otherwise known as the Land
Registration Act, [La Pazs] titles to the land in question are
indefeasible, binding, conclusive and enforceable against
the whole world.
11

Following other developments in the case, 12La Paz filed

on 22 February 1995 an Omnibus Amended Motion (for
Summary Judgment and Cancellation of Lis Pendens).
Acting on the said Motion, the Bian RTC issued on 14 July
1995 an Omnibus Order in Civil Case No. B-4194, the
decretal portion of which reads:
WHEREFORE, in view of the foregoing, the instant Omnibus
Amended Motion for Summary Judgment filed by counsel for
[La Paz] is hereby GRANTED in accordance with Rule 34 of the
Revised Rules of Court. The Original Certificate of Title No. 242
issued to the Government of the Philippine Islands and the [La
Pazs] nineteen (19) Transfer Certificates of Title which were
respectively derives [sic] therefrom are hereby declared
indefeasible for all legal intents and purposes against any
other title thereby making it binding to the whole world.
Necessarily, the Motion for Leave to Intervene and the
Motion for Issuance of a Writ of Preliminary Injunction, both
pending before this Court, are hereby declared MOOTED.
On the other hand, the Motion for Cancellation of Lis
Pendens included in the [La Pazs] Omnibus Motion for

Summary Judgment is likewise GRANTED for the reasons

above-stated.
Consequently, the Office of the Register of Deeds of
Calamba, Laguna is hereby directed to immediately cancel the
Notice of Lis Pendensannotated at the back of each of the [La
Pazs] nineteen (19) Transfer Certificates of Title which were all
disputed by the [Spouses Layos].
Meanwhile, let the hearing of the instant case for the
reception of evidence as to the counterclaim of [La Paz] for
damages be set for hearing on August 31, 1995 at 8:30 oclock
in the morning.
13

When their motion for reconsideration was denied by

the Bian RTC, the Spouses Layos appealed their case to
the Court of Appeals, where it was docketed as CA-G.R.
CV No. 50962. In a Decision14 dated 20 February 2001, the
appellate court ruled:
Under par. 13 of the [Spouses Layos] complaint, it was
alleged that La Paz[s] title was issued only on August 9, 1913,
which was 14 days after the issuance of the Layos title. From
the findings of the lower court, August 13, 1913 was the date
when La Paz[s] title was transcribed at the Register of Deeds
while that of the Layos as can be seen in their attached xerox
copy of title, the transcription was made later which was on
November, 1913.
The date issued referred to by [Spouses Layos] is the date
of the decree of judgment issued by the Court. But this is not
the reckoning period within which title should become
indefeasible in the ambit of the law. The operative act is the
decree of registration which is the transcription at the Register
of Deeds. One year after its transcription in the Register of
Deeds, the title becomes indefeasible. It means therefore, that
it is the transcription in the Register of Deeds and not the date
decreed by the Court is the operative act. And this should be
the reckoning date when a title becomes indefeasible.

In the case at bar, we have the scenario that OCT 239 was
earlier decreed by the Land Management Court than OCT 242,
but for unknown reasons, OCT 242 was transcribed earlier at
the Register of [D]eeds on August 19, 1913 while OCT 239 was
transcribed at the Register of Deeds only on November 18,
1913. While the PSU-201 is of minor importance as even
claimed by [Spouses Layos], this court deem to pass over the
same.
[Spouses Layos] contended that the representatives of the
Land Management Bureau, identified and confirmed that the
Original PSU-201 in the name of Natalio Layos and the
technical descriptions as appearing in LMB Form No. 28-37R
issued to [Spouses Layos], are true and genuine. But this was
denied by the Chief, Records of [sic] Division of the Bureau of
Lands, Mr. Armando Bangayan, the superior of the Land
Management Bureau, alleging in his affidavit that was [sic] not
his signature appearing in the Certification. And to corroborate
the denial of Mr. Bangayan, a certain Engineer Private (sic) J.J.
Dalire, Chief of Surveys Division, Land Management Bureau,
PSU-201 which is purportedly covered by OCT No. 239 is a
survey plan in the name of J. Reed and it covers a piece of land
situated in Malate, Manila. Further, the Regional Technical
Director for Lands, Region IV, Roxas Boulevard, Manila has
issued an Order declaring PSU-201 of Natalio Layos as null and
void, because it is a spurious document.
Considering the aforementioned, this Court believes that
[Spouses Layos] has [sic] no proof to establish their claim in
the present case.
With the foregoing, this court is more inclined to believe the
three affidavits executed by three (3) different individuals
coming from different offices that PSU-201 claimed by Layos is
obviously doubtful, contrary to the affidavits of persons who
are subordinates of Bangayan. If this is so, OCT 239 is
therefore, patently a spurious title. (Underscoring supplied.)
15

Based on the foregoing ratiocination, the fallo of the

Court of Appeals Decision dated 20 February 2001 in CAG.R. CV No. 50962 reads, thus:
WHEREFORE, finding no reversible error committed on the
part of the lower court, the appealed Omnibus Order dated July
14, 1995 is hereby AFFIRMED.
16

Records do not show whether the Spouses Layos filed a

motion for reconsideration of the afore-mentioned
Decision of the appellate court; what they do establish is
that the Spouses Layos filed a Petition for Review
on Certiorari with this Court, docketed as G.R. No.
155612, but said Petition was denied by this Court in a
Resolution dated 13 January 2003 because of the Spouses
Layos failure to:
a)take the appeal within the reglementary period of fifteen
(15) days in accordance with Section 2, Rule 45 in relation to
Section 5(a), Rule 56, in view of the denial of the motion for
extension of time to file said petition in the resolution of 20
November 2002;
b)properly verify the petition in accordance with Section
4, Rule 7 in relation to Section 1, Rule 45, and submit a valid
certification on non-forum shopping duly executed by all
petitioners in accordance with Section 5, Rule 7, Section 4(e),
Rule 45 in relation to Section 2, Rule 42 and Sections 4 and
5(d), Rule 56, there being no proof that petitioner Felipe Layos
was duly authorized to sign said verification and certification
on non-forum shopping in behalf of his co-petitioner; and
c)serve a copy of the petition on the Court of Appeals in
accordance with Section 4, Rule 13, in relation to Section 3,
Rule 45 of the 1997 Rules of Civil Procedure, as amended, and
par. 2 of Revised Circular No. 1-88 of this Court.
17

The Resolution dated 13 January 2003 of this Court

denying the Petition in G.R. No. 155612 became final and

executory, and entry of judgment was made therein on

14 March 2003.18
G.R.
No.
150470:
The Reconstitution Case
The Court now comes to the Petition at bar.
The instant Petition originated from a Petition for
Reconstitution19 of OCT No. 239 filed by the Spouses
Layos on 12 August 1993 with the San Pedro RTC,
docketed as LRC Case No. B-1784. It is noted that the
Spouses Layos instituted this reconstitution case on the
same day as their quieting of title case before the Bian
RTC.
The Petition in LRC Case No. B-1784 essentially
contained the same allegations made by the Spouses
Layos in their Complaints in the injunction cases and
quieting of title case. However, in support of their prayer
for the reconstitution of the original copy of OCT No. 239
from their Owners Duplicate Certificate, the Spouses
Layos additionally alleged that:
6.The Owners Duplicate Certificate of the said Original
Certificate of Title is in due form without any alteration or
erasure, and is not subject to litigation or investigation,
administrative or judicial, regarding its genuineness or due
execution or issuance.
xxxx
9.The Original Copy of the said title which used to be in
the Office of the Register of Deeds for the Province of Laguna
appears to have been lost and/or destroyed. In fact, the said
Office does not anymore have any record regarding the subject
title.
10.The above parcels of land are free from any lien or
encumbrance, and no deed or instrument affecting the same
has been presented for registration or is any such deed or

instrument pending registration with the Office of the Register

of Deeds for the Province of Laguna.
11.The above parcels of land are in lawful possession of
[Spouses Layos].
12.The transfer of the subject properties from Natalio
Layos to Mauricio Layos (by inheritance) and the subsequent
transfer of the same properties from Mauricio Layos to
petitioner Felipe Layos (through the Affidavit of SelfAdjudication with Sale executed by Mauricio Layos in favor of
Felipe Layos) cannot be registered and new title/s cannot be
issued in the name of [Spouses Layos] because the original
copy of said Original Certificate of Title No. 239 was lost and/or
destroyed.
20

Several parties filed their intervention and/or

opposition to the Petition for Reconstitution of the
Spouses Layos in LRC Case No. B-1784, particularly:
PARTY
Shappel
Homes,
Inc.

La Paz

FEGDI

PLEADING

INTEREST/BASI
S
Complaint- In
a
Joint
inVenture
with
2
Intervention the
Spouses
1
Layos
to
develop
the
subject
property
Opposition22 Existing TCTs
over
the
subject
property
Opposition23 In
a
Joint
Venture
with
La
Paz
to
develop
the
subject
property
as

Mauricio
Layos

Spouses
Antonio
and
Norma
Saavedr
a
Veneraci
on
L.
Arboleda
, Antonio
L.
Arboleda
,
Jr.,
Lydia
Arboleda
-David,
and
Antonio
M.
Arboleda

part of the
Manila
Southwoods
Project
Opposition24 Sole child and
heir of Natalio
Layos denies
alienating
or
disposing the
subject
property
in
favor of the
Spouses Layos
Complaint- Purchased
inportions of the
2
Intervention subject
5
property from
Mauricio Layos
and
Felipe
Layos
Complaint- Purchased
inportions of the
2
Intervention subject
6
property from
Mauricio Layos
and/or Felipe
Layos

Spouses
Petition-in- Purchased
Ponciano Intervention2 a portion
and Annie 7
of
the
Miranda
subject
property
from the
Spouses
Layos
28
Bonifacio Opposition The true
Javier,
heirs
of
representi
Natalio
ng
the
Layos
Heirs
of
deny that
Natalio
the
Layos
Spouses
Layos are
in
any
way
related to
them
Spouses
Motion
forPurchased
Marina
Intervention2 an
9
and
undivided
Generoso
portion of
Otic
the
subject
property
from
Mauricio
Layos and
are, thus,
co-owners
of
the
subject
property
with

which the Supreme Court categorically declared that the

said certificate of title was a forgery. The appellate court
contradicted the Spouses Layos assertion that such
declaration of the Supreme Court in G.R. No. 120958 was
merely an obiter dictum, for the same was a resolution of
one of the controverted issues and was part of the
principal disquisition of the lower court. Hence, in its
assailed Decision33 dated 26 April 2001, the Court of
Appeals decreed:

Spouses
Petition-in- Purchased
Ponciano Intervention2 a portion
and Annie 7
of
the
Miranda
subject
property
from the
Spouses
Layos
Mauricio
Layos
FEGDI and La Paz filed separate Motions to Dismiss,
which the Office of the Solicitor General supported in its
Comment on the Petition. On 19 January 1998, the San
Pedro RTC issued an Order, 30 the dispositive portion of
which states:
Acting therefore on the motion (sic) to dismiss filed by La
Paz Housing and FEGDI, and it appearing that indeed the title
sought to be reconstituted, specifically OCT No. 239 is a
forgery as held no [sic] less than the Supreme Court in G.R. No.
120958, Fil-Estate Golf and Development, Inc., (FEGDI) vs.
Court of Appeals, December 16, 1996, the Court has no other
option but to dismiss the case.
Resolution on all other pending incidents had been rendered
moot and academic with the dismissal of this case.
31

The San Pedro RTC denied the Spouses Layos Motion

for Reconsideration in an Order 32 issued on 1 October
1998.
Aggrieved, the Spouses Layos filed an appeal with the
Court of Appeals, docketed as CA-G.R. CV No. 61759. The
appellate court, however, found no reversible error in the
ruling of the lower court dismissing the Spouses Layos
Petition for Reconstitution. According to the Court of
Appeals, the validity of OCT No. 239 of the spouses Layos
was already determined by the Supreme Court in its
Decision dated 16 December 1996 in G.R. No. 120958, in

WHEREFORE, premises considered, the instant appeal is

hereby DISMISSED, and the orders of the lower court dated
January 19, 1998 and October 1, 1998 are hereby AFFIRMED.
34

The Spouses Layos moved for the reconsideration of

the foregoing Decision, but they failed to convince the
Court of Appeals to detract from its earlier ruling.
Resultantly, the appellate court denied what it called the
pro formamotion for reconsideration of the Spouses
Layos in a Resolution35 dated 18 October 2001.
The Spouses Layos, thus, filed before this Court the
instant Petition for Review on Certiorari under Rule 45 of
the Rules of Court, docketed as G.R. No. 150470, stating
the following assignment of errors:
A.The Court of Appeals erred in applying the principle
of res judicata in the instant case, when it declared that the
ruling of this Honorable Supreme Court in G.R. No. 120958 is
conclusive upon the issue of validity of the [Spouses Layos]
O.C.T. No. 239;
B.The Court of Appeals
observation of this Honorable
120958 to the effect that OCT
merely an obiter dictum, but
controverted issues, and is part
the Supreme Court;

erred in holding that the

Supreme Court in G.R. No.
No. 239 is a forgery was not
a resolution of one of the
of the principal disquisition of

C.The Court of Appeals erred in upholding the summary

dismissal of the instant case by the court a quo by holding that
since the title sought to be reconstituted has finally been
determined as a forgery and fake, there is no longer a need for
trial and in effect deprived [Spouses Layos] of property without
due process of law; [and]
D.The Court of Appeals erred in upholding the decision of
the lower court and in effect violated the cardinal rule against
a collateral attack against the validity of the land title;
36

and seeking the following reliefs from this Court:

WHEREFORE, it is respectfully prayed that judgment be
rendered by this Honorable Court, setting aside the assailed
Decision dated April 26, 2001 and Resolution dated October
18, 2001 respectively of the Court of Appeals which affirmed
the Decision of the Court a quo for being contrary to law and
jurisprudence and directing the Regional Trial Court of San
Pedro, Laguna to forthwith receive evidence of all parties
concerned to determine the merits of their respective claims.
Other reliefs just and equitable are likewise prayed for.

II
THE COURTS RULING
Res Judicata
Based on the arguments raised by the parties in their
pleadings herein, the foremost issue for resolution of this
Court is whether the Decision dated 16 December 1996
of this Court in G.R. No. 120958 bars by res judicata LRC
Case No. B-1784, the Petition for Reconstitution of OCT
No. 239 filed by the Spouses Layos before the San Pedro
RTC, thus, justifying the dismissal of the latter case.
The Spouses Layos maintain that the Decision dated
16 December 1996 of this Court in G.R. No. 120958 does
not bar by res judicata their Petition for Reconstitution of
the same certificate of title in LRC Case No. B-1784, there

being no identity of parties, causes of action, and subject

matters between the two cases. They insist that the Court
in G.R. No. 120958 had no jurisdiction to determine the
issue of ownership as the same was never raised or
contained in the pleadings and, therefore, any
pronouncement of the Court in its Decision of 16
December 1996 on the validity of OCT No. 239 or on the
question of ownership is mere obiter dictum. They
highlight the fact that thefallo of the Courts 16
December 1996 Decision in G.R. No. 120958 simply
dismissed the injunction case before the San Pedro RTC
but did not annul or cancel OCT No. 239.
The position of the Spouses Layos is untenable.
Res judicata literally means a matter adjudged; a
thing judicially acted upon or decided; a thing or matter
settled by judgment. Res judicata lays the rule that an
existing final judgment or decree rendered on the merits,
and without fraud or collusion, by a court of competent
jurisdiction, upon any matter within its jurisdiction, is
conclusive of the rights of the parties or their privies, in
all other actions or suits in the same or any other judicial
tribunal of concurrent jurisdiction on the points and
matters in issue in the first suit.37
It is espoused in the Rules of Court, under paragraphs
(b) and (c) of Section 47, Rule 39, which provide:
SEC.47.Effect of judgments or final orders.The effect
of a judgment or final order rendered by a court of the
Philippines, having jurisdiction to pronounce the judgment or
final order, may be as follows:
xxxx
(b)In other cases, the judgment or final order is, with
respect to the matter directly adjudged or as to any other
matter that could have been raised in relation thereto,
conclusive between the parties and their successors in interest

by title subsequent to the commencement of the action or

special proceeding, litigating the same thing and under the
same title and in the same capacity; and

The doctrine res judicataactually embraces two different

concepts: (1) bar by former judgment and (b) conclusiveness
of judgment.

(c)In any other litigation between the same parties or

their successors in interest, that only is deemed to have been
adjudged in a former judgment or final order which appears
upon its face to have been so adjudged, or which was actually
and necessarily included therein or necessary thereto.

The second conceptconclusiveness of judgmentstates

that a fact or question which was in issue in a former suit and
was there judicially passed upon and determined by a court of
competent jurisdiction, is conclusively settled by the judgment
therein as far as the parties to that action and persons in
privity with them are concerned and cannot be again litigated
in any future action between such parties or their privies, in
the same court or any other court of concurrent jurisdiction on
either the same or different cause of action, while the
judgment remains unreversed by proper authority. It has been
held that in order that a judgment in one action can be
conclusive as to a particular matter in another action between
the same parties or their privies, it is essential that the issue
be identical. If a particular point or question is in issue in the
second action, and the judgment will depend on the
determination of that particular point or question, a former
judgment between the same parties or their privies will be final
and conclusive in the second if that same point or question
was in issue and adjudicated in the first suit (Nabus vs. Court
of Appeals, 193 SCRA 732 [1991]). Identity of cause of action is
not required but merely identity of issue.

The doctrine of res judicata lays down two main rules

which may be stated as follows: (1) The judgment or
decree of a court of competent jurisdiction on the merits
concludes the litigation between the parties and their
privies and constitutes a bar to a new action or suit
involving the same cause of action either before the
same or any other tribunal; and (2) any right, fact, or
matter in issue directly adjudicated or necessarily
involved in the determination of an action before a
competent court in which a judgment or decree is
rendered on the merits is conclusively settled by the
judgment therein and cannot again be litigated between
the parties and their privies whether or not the claims or
demands, purposes, or subject matters of the two suits
are the same. These two main rules mark the distinction
between the principles governing the two typical cases in
which a judgment may operate as evidence. 38 In speaking
of these cases, the first general rule above stated, and
which corresponds to the aforequoted paragraph (b) of
Section 47, Rule 39 of the Rules of Court, is referred to as
bar by former judgment; while the second general rule,
which is embodied in paragraph (c) of the same section
and rule, is known as conclusiveness of judgment.
The Resolution of this Court in Calalang v. Register of
Deeds
of
Quezon
City,39provides
the
following
enlightening discourse on conclusiveness of judgment:

Justice Feliciano, in Smith Bell & Company (Phils.), Inc. vs.

Court of Appeals (197 SCRA 201, 210 [1991]), reiteratedLopez
vs. Reyes (76 SCRA 179 [1977]) in regard to the distinction
between bar by former judgment which bars the prosecution of
a second action upon the same claim, demand, or cause of
action, and conclusiveness of judgment which bars the
relitigation of particular facts or issues in another litigation
between the same parties on a different claim or cause of
action.
The general rule precluding the relitigation of material
facts or questions which were in issue and adjudicated in

former action are commonly applied to all matters

essentially connected with the subject matter of the
litigation. Thus, it extends to questions necessarily
implied in the final judgment, although no specific finding
may have been made in reference thereto and although
such matters were directly referred to in the pleadings
and were not actually or formally presented. Under this
rule, if the record of the former trial shows that the
judgment could not have been rendered without deciding
the particular matter, it will be considered as having
settled that matter as to all future actions between the
parties and if a judgment necessarily presupposes certain
premises, they are as conclusive as the judgment itself.

Another case, Oropeza Marketing Corporation v. Allied

Banking Corporation,40 further differentiated between the
two rules of res judicata, as follows:
There is bar by prior judgment when, as between the
first case where the judgment was rendered and the second
case that is sought to be barred, there is identity of parties,
subject matter, and causes of action. In this instance, the
judgment in the first case constitutes an absolute bar to the
second action. Otherwise put, the judgment or decree of the
court of competent jurisdiction on the merits concludes the
litigation between the parties, as well as their privies, and
constitutes a bar to a new action or suit involving the same
cause of action before the same or other tribunal.
But where there is identity of parties in the first and
second cases, but no identity of causes of action, the first
judgment is conclusive only as to those matters actually and
directly controverted and determined and not as to matters
merely involved therein. This is the concept ofres
judicata known asconclusiveness of judgment. Stated
differently, any right, fact, or matter in issue directly
adjudicated or necessarily involved in the determination of an
action before a competent court in which judgment is rendered

on the merits is conclusively settled by the judgment therein

and cannot again be litigated between the parties and their
privies whether or not the claim, demand, purpose, or subject
matter of the two actions is the same. (Emphasis ours.)

In sum, conclusiveness of judgment bars the relitigation in a second case of a fact or question already
settled in a previous case. The second case, however,
may still proceed provided that it will no longer touch on
the same fact or question adjudged in the first case.
Conclusiveness of judgment requires only the identity of
issues and parties, but not of causes of action.
It is on the ground of res judicata, in its second concept
conclusiveness of judgmentthat the Petition for
Reconstitution of the Spouses Layos must be dismissed.
As explained by the Court of Appeals in its assailed
Decision:
In the case at bar, the ruling of the Supreme Court in G.R.
No. 120958 is conclusive upon the issue of validity of the
[Spouses Layos] OCT No. 239, inasmuch as the said issue has
already been mutually controverted by the parties and ruled
upon with finality by the Supreme Court no less, in favor of the
invalidity of the [Spouses Layos] title.
41

Conclusiveness
of
Judgment
in G.R. No. 120958
Contrary to the position of the Spouses Layos, there is
identity of parties and issues between G.R. No. 120958
(the injunction cases) and LRC Case No. B-1784 (the
reconstitution case).
The principal parties in both cases are the Spouses
Layos, on one hand, and La Paz and FEGDI, on the other.
The Spouses Layos and La Paz both claim title to the
subject property, while FEGDI is the partner of La Paz in a
joint venture to develop the said property. There may be
other parties named in both cases, but these parties only

derive their rights from the principal parties. The Court

has previously held that for purposes of res judicata, only
substantial identity of parties is required and not absolute
identity. There is substantial identity of parties when
there is community of interest between a party in the first
case and a party in the second case even if the latter was
not impleaded in the first case. In other words, privity or a
shared identity of interest is sufficient to invoke
application of the principle of res judicata.42 It is
fundamental that the application of res judicatamay not
be evaded by simply including additional parties in a
subsequent litigation.43
For conclusiveness of judgment, identity of causes of
action and subject matter is not required; it is the identity
of issues that is material. The issue of the validity of the
Spouses Layos title to the subject property is integral to
both G.R. No. 120958 and LRC Case No. B-1784.
In G.R. No. 120958, the Spouses Layos themselves
invoked OCT No. 239 to establish their title over the
subject property. It was on the basis of their title to the
subject property that they sought to enjoin FEGDI and La
Paz from entering into and developing the same. In
seeking the dismissal of the injunction case before the
San Pedro RTC, La Paz presented its own title to the
subject property by virtue of which it claimed the right to
possess and develop the said property. It then became
incumbent upon the Court to determine which of the
titles to the property is valid. For the Spouses Layos to be
entitled to the issuance of a writ of injunction, it must
have valid title to the subject property. Without a valid
title to the said property, the Spouses Layos had no cause
of action for injunction against FEGDI and La Paz. It was in
this context that the Court was compelled to look into the
validity of the Spouses Layos title to the subject property.

After consideration of the Complaint for injunction of

the Spouses Layos and its annexed documents, the Court
observed that: (a) the annexed Affidavit of SelfAdjudication with Sale, supposedly executed by Mauricio
Layos in favor of his son Felipe Layos stated that the
subject property had not been registered; (b) Mauricio
Layos filed an application for registration of the subject
property with the Bian RTC in 1992; (c) Mr. Privadi Dalire,
Chief of the Geodetic Surveys Division of the Bureau of
Lands, stated his findings in his letters dated 12
November 1992 and 15 December 1992, that Plan PSU201, on which OCT No. 239 was supposed to be based,
was actually a survey for J. Reed covering a piece of land
in Malate, Manila, that was heavily damaged and had not
yet been fully reconstructed and microfilmed; and (d) Mr.
Sidicious F. Panoy, the Regional Director of the
Department of Environment and Natural Resources
(DENR), Region IV, issued an Order dated 5 May 1994,
cancelling all plans pertaining to PSU-201, since it was a
spurious plan and, probably the result of a manipulative
act by scheming individuals who surreptitiously got it
inserted in the records,44which led the Court to the
inescapable conclusion in its Decision dated 16
December 1996 that OCT No. 239 is fake or a forgery.
Consequently, the Court of Appeals correctly ruled that
the pronouncement of the Supreme Court in G.R. No.
120958 on the invalidity of OCT No. 239 was not
merely obiter dictum,45 but was a resolution of one of the
controverted issues in said case. In fact, it was on the
basis of the said pronouncement that this Court ordered
the dismissal of the injunction case filed before the San
Pedro RTC for lack of cause of action.
In LRC Case No. B-1784, the Spouses Layos once again
invoked ownership of the subject property pursuant to
OCT No. 239. They sought the reconstitution of the

original copy of OCT No. 239 which allegedly used to be

in the possession of the Register of Deeds of Laguna, but
was now lost and/or destroyed, and, in support thereof,
they presented their owners duplicate of OCT No. 239.
However, both La Paz and FEGDI, as well as the Office of
the Solicitor General, opposed the Petition for
Reconstitution of the Spouses Layos on the ground that
OCT No. 239 and Plan Psu-201, on which said certificate
of title was based, were spurious. The opposition to LRC
Case No. B-1784, thus, raised the question of whether a
valid OCT No. 239 existed in the first place, and could be
reconstituted.
Reconstitution or reconstruction of a certificate of title
literally and within the meaning of Republic Act No. 26
denotes restoration of the instrument which is supposed
to have been lost or destroyed in its original form and
condition.46 For an order of reconstitution to issue, the
following elements must be present: 1) the certificate of
title has been lost or destroyed; 2) the petitioner is the
registered owner or has an interest therein; and 3) the
certificate of title is in force at the time it was lost or
destroyed.47
While G.R. No. 120958 does not bar the institution of
LRC Case No. B-1758, the pronouncement of invalidity of
OCT No. 239 by this Court in G.R. No. 120958 is
conclusive upon the San Pedro RTC in LRC Case No. B1758, precluding it from re-litigating the same issue and
ending up with a contrary ruling. Since the Court already
settled in G.R. No. 120958 that OCT No. 239 is fake and a
forgery, it would have been a senseless and futile
endeavor for the San Pedro RTC to continue with the
reconstitution proceedings in LRC Case No. B-1758, for
there is actually no valid certificate to reconstitute. The
court cannot, and should not, reconstitute a spurious
certificate of title and allow the continuous illegal

proliferation and perpetuation thereof. Republic Act No.

2648provides for a special procedure for the reconstitution
of Torrens certificates of title that are missing but not
fictitious titles or titles, which are existing.49
Resultantly, the San Pedro RTC is left with no other
option but to order the dismissal of LRC Case No. B-1758.
Conclusiveness
of
Judgment
in G.R. No. 155612
During the pendency of the Petition at bar, a significant
development took place in the quieting of title case. The
Court had already denied in a Resolution dated 13
January 2003 the appeal of the Spouses Layos in G.R. No.
155612 and, in effect, affirmed the Decision dated 20
February 2001 of the Court of Appeals in CA-G.R. CV No.
50962. It should be recalled that in said Decision, the
appellate court upheld the validity of OCT No. 242 from
which La Paz derived its TCTs and, at the same time,
explicitly found OCT No. 239 of the Spouses Layos
spurious.
This ruling of the Court of Appeals on the spuriousness
of OCT No. 239, once again, constitutes res judicata by
conclusiveness of judgment on the Petition for
Reconstitution of the Spouses Layos.
The Spouses Layos and La Paz, asserting their
respective titles to and ownership of the subject property,
are parties to the quieting of title case, as well as the
reconstitution case. In their Complaint before the Bian
RTC, the Spouses Layos prayed for the quieting of their
title to the subject property under OCT No. 239 by the
annulment or cancellation of the TCTs of La Paz covering
the same property. In answer, La Paz claimed that it was
its title to the subject property under the 19 TCTs, derived
from OCT No. 242, which was valid, and pointed out that
it was actually OCT No. 239 and its supporting documents
which were inexistent in the records of the concerned

government agencies. Given the contradicting assertions

of the parties, the Bian RTC and the Court of Appeals, in
their original and appellate jurisdiction, respectively, over
the quieting of title case, had to delve into the issue of
validity of OCT No. 239 vis--vis OCT No. 242.
Necessarily, only one of the said certificates of title over
the same property can be valid, and the 20 February
2001 Decision of the Court of Appeals in CA-G.R. CV No.
50962 settled with finality that it is OCT No. 242. The
categorical finding of the Court of Appeals in CA-G.R. CV
No. 50962 (the quieting of title case) that OCT No. 239
is spurious is now conclusive and binding upon this
Court in its consideration on appeal of the Spouses Layos
Petition for Reconstitution of OCT No. 239, in much the
same way and for the same reasons previously discussed
herein for the conclusiveness of this Courts judgment in
G.R. No. 120958 (the injunction cases) that OCT No. 239
is fake and a forgery.
Finality of Judgment
A statement in the Spouses Layos Petition for Review
before this Court reveals their ultimate intent:
The test of a mans honor is his ability to admit his mistake. In
the instant case, it would [be] in keeping with the rule of law
and justice for this Most Venerable and Honorable Court to
allow the parties to fully ventilate their claims in the court
below instead of depriving the [Spouses Layos] of their valued
property based on sweeping obiter dictum by this Court in the
FEDGI [sic] case where the [Spouses Layos] title was not
directly attacked.
50

It may be nicely and even deceptively phrased but,

simply, what the Spouses Layos pray to this Court is for
the re-litigation of an issue settled conclusively in this
Courts Decision dated 16 December 1996 in G.R. No.
120958, and also in the Court of Appeals Decision dated
20 February 2001 in CA-G.R. CV No. 50962. Both

Decisions have already become final, and no part thereof

may be disturbed by any court, even if to correct a
purported error therein.
Nothing is more settled in law than that when a final
judgment is executory; it thereby becomes immutable
and unalterable. The judgment may no longer be
modified in any respect, even if the modification is meant
to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether the
modification is attempted to be made by the court
rendering it or by the highest Court of the land. The
doctrine is founded on considerations of public policy and
sound practice that, at the risk of occasional errors,
judgments must become final at some definite point in
time.51
What cannot be directly done by motion for
reconsideration or appeal, given the finality of the
Decisions in G.R. No. 120985 and CA-G.R. CV No. 50962,
likewise, cannot be indirectly done through a separate
proceeding.
Under the doctrine of conclusiveness of judgment
which is also known as preclusion of issues or
collateral estoppel, issues actually and directly resolved
in a former suit cannot again be raised in any future case
between the same parties involving a different cause of
action. Once a judgment attains finality it becomes
immutable and unalterable. It may no longer be modified
in any respect, even if the modification is meant to
correct what is perceived to be an erroneous conclusion
of fact or law, and regardless of whether the modification
is attempted to be made by the court rendering it or by
the highest court of the land.52
Due Process
The Spouses Layos contend that the Order dated 19
January 1998 of the San Pedro RTC dismissing their

Petition for Reconstitution without a full blown trial

deprived them of their property without due process. The
said Order had no evidentiary foundation, being based
entirely on the unjust and sweeping conclusion of this
Court in its 16 December 1996 Decision in G.R. No.
120958 that OCT No. 239 is fake or a forgery.
There is no truth in the averments of the Spouses
Layos.
Holding a trial in the reconstitution case would be an
exercise in futility, because given the conclusiveness of
the judgment of this Court in G.R. No. 120958 and the
Court of Appeals in CA-G.R. CV No. 50962 that OCT No.
239 is fake, forged, and spurious, then the San Pedro RTC
in LRC Case No. B-1758 is, thus, barred from re-litigating
the issue and accepting evidence thereon.
Furthermore, due process does not require that a trial
be held in all circumstances. This Court, in a Resolution
dated 18 November 2003 inRepublic v. Sandiganbayan,
elucidated that:
The words hearing and trial have different meanings and
connotations. Trial may refer to the reception of evidence and
other processes. It embraces the period for the introduction of
evidence by both parties. Hearing, as known in law, is not
confined to trial but embraces the several stages of litigation,
including the pre-trial stage. A hearing does not necessarily
mean presentation of evidence. It does not necessarily imply
the presentation of oral or documentary evidence in open
court but that the parties are afforded the opportunity to be
heard.
A careful analysis of Section 5 of RA 1379 readily discloses
that the word hearing does not always require the formal
introduction of evidence in a trial, only that the parties are
given the occasion to participate and explain how they
acquired the property in question. If they are unable to show to
the satisfaction of the court that they lawfully acquired the

property in question, then the court shall declare such property

forfeited in favor of the State. There is no provision in the law
that a full blown trial ought to be conducted before the court
declares the forfeiture of the subject property. Thus, even if the
forfeiture proceedings do not reach trial, the court is not
precluded from determining the nature of the acquisition of the
property in question even in a summary proceeding.
Due process, a constitutional precept, does not therefore
always and in all situations require a trial-type proceeding. The
essence of due process is found in the reasonable opportunity
to be heard and submit ones evidence in support of his
defense. What the law prohibits is not merely the absence of
previous notice but the absence thereof and the lack of
opportunity to be heard. This opportunity was made
completely available to respondents who participated in all
stages of the litigation.
53

The Spouses Layos cannot claim deprivation of

property without due process when they were never
denied the opportunity to be heard by the courts. The
Spouses Layos repeatedly and persistently sought
recourse from the courts, at the risk of forum shopping
(of which it was actually found guilty at one point in G.R.
No. 120958). They instituted no less than four cases
before the RTCs of Bian and San Pedro, Laguna;
although based on different causes of action, all invoked
their title to the subject property under OCT No. 239.
They were able to file pleadings bearing their allegations
and arguments, reply to their opponents pleadings, and
present as attachments their documentary evidence.
When their cases were dismissed by the RTCs, they were
able to file their motions for reconsideration and, upon
denial thereof, raised their case on appeal to the
appellate court. Unfortunately for the Spouses Layos,
however, the Court of Appeals and this Court agreed in
the dismissal of their cases.

That the cases of the Spouses Layos were dismissed by

the RTCs even before they reach trial stage is not denial
of due process. The dismissals were due to the lack of
merit of their complaints and/or petitions, already
apparent in the pleadings and evidence on record, and
pointed out in their opponents Motions for Dismissal (in
the injunction cases) and Motion for Summary Judgment
(in the quieting of title case).
In a letter dated 8 September 2005 to then Chief
Justice Hilario G. Davide,54 made part of the records of this
case, Felipe Layos averred that the conflicting allegations
and documents which led this Court and the Court of
Appeals in G.R. No. 120958 and CA-G.R. CV No. 50962,
respectively, to declare OCT No. 239 spurious, were
fraudulently prepared and submitted to the courts in a
concerted scheme (which sadly seemed to involve their
former counsel, Atty. Vitaliano Aguirre II) to deprive them
of the subject property. Now represented by a new
counsel, he requested that he be given a chance to prove
that the subject property is covered by OCT No. 239 and
not OCT No. 242.
Even if it is conceded that the allegations of the
aforementioned letter are true, no stretch of
interpretation or liberal application of the rules of
procedure can grant the San Pedro RTC jurisdiction in LRC
Case No. B-1758, a case for reconstitution, to set aside or
reverse the final judgment made in both G.R. No. 120958
and CA-G.R. CV No. 50962 on the invalidity of OCT No.
239.
The RTC, acting on a petition for reconstitution, is of
limited jurisdiction. Lands already covered by valid titles
in the name of registered owners other than the
petitioners cannot be a proper subject of reconstitution
proceedings, thus:

The Court stresses once more that lands already covered

by duly issued existing Torrens Titles (which become
incontrovertible upon the expiration of one year from their
issuance under Section 38 of the Land Registration Act) cannot
be the subject of petitions for reconstitution of allegedly lost or
destroyed titles filed by third parties without first securing by
final judgment the cancellation of such existing titles. (And as
the Court reiterated in the recent case of Silvestre vs. Court of
Appeals, in cases of annulment and/or reconveyance of title, a
party seeking it should establish not merely by a
preponderance of evidence but by clear and convincing
evidence that the land sought to be reconveyed is his.) The
courts simply have no jurisdiction over petitions by
such third parties for reconstitution of allegedly lost or
destroyed titles over lands that are already covered by
duly issued subsisting titles in the names of their duly
registered owners. The very concept of stability and
indefeasibility of titles covered under the Torrens
System of registration rules out as anathema the
issuance of two certificates of title over the same land
to two different holders thereof. (Emphasis ours.)
55

It should be pointed out that the validity of the title to

the subject property herein had already been squarely
put in issue in Civil Case No. B-4194, the quieting of title
case, instituted by the Spouses Layos before the Bian
RTC, and resolved definitively and with finality when
appealed to the Court of Appeals in CA-G.R. CV No.
50962, in favor of La Paz. It is a ruling irrefragably beyond
the jurisdiction of the San Pedro RTC to overturn or
contradict in LRC Case No. B-1784, the reconstitution
case.
The prayer of the Spouses Layos to have LRC Case No.
B-1784 remanded to the San Pedro RTC for trial, if
granted, would only be farcical. Should the San Pedro RTC
subsequently grant the reconstitution of OCT No. 239

after the trial, it would only be an empty victory for the

Spouses Layos, for a reconstituted certificate of title, like
the original certificate, by itself does not vest ownership
of the land or estate covered thereby. 56 The valid title to
the subject property would still be that of La Paz, as
determined by the Court of Appeals in CA-G.R. CV No.
50962, over which the reconstituted certificate of title of
the Spouses Layos cannot prevail. The reconstituted OCT
No. 239 would be a mere piece of paper with actually no
title to evidence ownership.
As earlier mentioned, a reconstitution of title is the reissuance of a new certificate of title lost or destroyed in its
original form and condition. It does not pass upon the
ownership of the land covered by the lost or destroyed title.
Any change in the ownership of the property must be the
subject of a separate suit. Thus, although petitioners are in
possession of the land, a separate proceeding is necessary to
thresh out the issue of ownership of the land.
57

The reconstitution of a title is simply the reissuance of a

new duplicate certificate of title allegedly lost or destroyed in
its original form and condition. It does not pass upon the
ownership of the land covered by the lost or destroyed title.
Possession of a lost certificate is not necessarily equivalent to
ownership of the land covered by it. The certificate of title, by
itself, does not vest ownership; it is merely an evidence of title
over a particular property.
58

Evidently, the Spouses Layos seek more than just

reconstitution of OCT No. 239 in LRC Case No. B-1758.
They want to hold a trial so as to prove before the San
Pedro RTC the fraudulent scheme perpetrated by several
people, including their former counsel, to sabotage their
cases before the courts; the errors in the Decisions of the
courts that have long attained finality; and, ultimately,
the validity of their title to the subject property. Again,
these are matters beyond the jurisdiction of the San

Pedro RTC to determine in a case for reconstitution. If

truly the Spouses Layos have been misled and defrauded
in a concerted effort to ruin their chances before the
courts, then their recourse is not to persist with this
petition for reconstitution of title, but to institute other
actions to hold those responsible administratively, civilly,
and even criminally liable.
Collateral Attack
Finally, the Spouses Layos argue that the Motions to
Dismiss of La Paz and FEGDI and the Comment of the
Office of the Solicitor General supporting the dismissal of
the Spouses Layos Petition for Reconstitution constitute a
collateral attack upon the validity of OCT No. 239, in
violation of the proscription laid down by law and
jurisprudence against any collateral attack of a duly
registered certificate of title.
The Spouses Layos are clearly mistaken. No collateral
attack on OCT No. 239 was made in LRC Case No. B-1784
(the reconstitution case). The San Pedro RTC dismissed it
precisely because the invalidity of said certificate of title
was already determined conclusively and with finality by
the Supreme Court in G.R. No. 120958 (the injunction
cases). A similar ruling of invalidity of OCT No. 239 was
rendered yet again in the final judgment of the Court of
Appeals in CA-G.R. CV No. 50962 (the quieting of title
case). Therefore, no collateral attack has been made on
OCT No. 239 in the present Petition; the San Pedro RTC,
Court of Appeals, and this Court only abided by the
conclusive and final judgment made on the invalidity of
OCT No. 239 in G.R. No. 120958 and CA-G.R. CV No. 50962.
In sum, the Decision dated 16 December 1996 of this
Court in G.R. No. 120958 and the Decision dated 20
February 2001 of the Court of Appeals in CA-G.R. CV No.
50962 declaring OCT No. 239 fake, forged, and spurious,
already bar the reconstitution of OCT No. 239 under the

doctrine ofres judicata, in the concept of conclusiveness

of judgment. There is, therefore, no need to remand the
case to the San Pedro RTC for trial.
WHEREFORE, premises considered, the instant Petition
for Review is hereby DENIED. The Decision dated 26 April
2001 and Resolution dated 18 October 2001 of the Court
of Appeals in CA-G.R. CV No. 61759, affirming the Order
dated 19 January 1998 of the Regional Trial Court, Branch
93 of San Pedro, Laguna, in LRC Case No. B-1784, which
dismissed the Petition for Reconstitution of OCT No. 239
filed by the petitioner-spouses Felipe and Victoria Layos,
are hereby AFFIRMED. Costs against the petitionerspouses.
SO ORDERED.
Ynares-Santiago
(Chairperson),
Austria-Martinez,
Nachura andReyes, JJ., concur.
Petition denied, judgment and resolution affirmed.
Notes.Under the principle of bar by prior judgment,
the judgment in the first case constitutes an absolute bar
to the second action. (Heirs of Clemencia Parasac vs.
Republic, 489 SCRA 498 [2006])
It has been held that a final and executory judgment
may be set aside with a view of the renewal of the
litigation when the judgment is void for lack of due
process of law. x x x It may be attacked directly or
collaterally, and the action therefor may be brought even
after the time for appeal or review has lapsed. (Macasasa
vs. Sicad, 491 SCRA 368 [2006])