Cases From Rule 20-32

Purpose of discovery
BERNARDO MERCADER VS. DBP

G.R. NO. 130699 (2000)
Facts: In its Pre-Trial Order, the RTC limited the issues to be resolved
in the case to three issues. Thereafter, the plaintiff, P, filed a
supplemental pleading that dealt with a new issue involving a leasepurchase option. D opposed the supplemental pleading
Issue: Whether the issue involving the lease-purchase option was
properly raised in the pleadings
Held: Yes. Said issue was raised in the supplemental pleading
subsequently filed by P. As a supplemental pleading, it served to aver
supervening facts which were then not ripe for judicial relief when the
original pleading was filed. As such, it was meant to supply
deficiencies in aid of the original pleading, and not to dispense with
the latter.
G.R. NO. 130699 (2000)
Facts: During the trial, P offered evidence on an issue not alleged in

the pleadings. D objected to the introduction of such evidence.
Issue: Whether the RTC may admit the evidence
Held: Yes. When evidence is offered on a matter not alleged in the
pleadings, the court may admit it even against the objection of the
adverse party, where the latter fails to satisfy the court that the
admission of the evidence would prejudice him in maintaining his
defense upon the merits, and the court may grant him a continuance
to enable him to meet the new situation created by the evidence. Of
course, the court, before allowing the evidence, as a matter of
formality, should allow an amendment of the pleading.
[G.R. No. 130699. May 12, 2000.]
SPOUSES BERNARDO MERCADER and FLORINA M. MERCADER,
and DR. JUAN Y. MADERAZO,Petitioners, v. DEVELOPMENT BANK
OF THE PHILIPPINES (CEBU BRANCH), GELACIO, FELIPE,
OSMUNDO all surnamed MANREAL, and RUFINA MANREAL VDA.
DE ABALO, Respondents.
DECISION
Facts: During the trial, the counsel of D participated in the direct and
cross-examination of witnesses whose testimonies included an issue
not among those appearing in the Pre-Trial Order. The RTC ruled on
the said issue. D questions the RTCs inclusion of the said issue in its
ruling.
Issue: Whether the said issue should be decided by the RTC
Held: Yes. D is estopped from questioning the RTCs inclusion of said
issue by its participation in the direct and cross-examination of
witnesses whose testimonies included said topic.
G.R. NO. 130699 (2000)
DAVIDE, JR., C.J.:

In this petition for review, petitioners spouses Florina MaderazoMercader and Bernardo Mercader (hereafter MERCADERs) and Juan
Y. Mederazo impugn the Court of Appeals 5 February 1997 decision
in CA-GR-CV No. 21846 1 ordering them to deliver the possession of
Lot No. 2985 to the Development Bank of the Philippines, Cebu
Branch (hereafter DBP) without right of reimbursements for the
improvements introduced thereon, and the 13 August 1997 resolution
denying the motion for reconsideration. Said decision and resolution
reversed and set aside the 6 September 1988 decision 2 of the
Regional Trial Court of Cebu, Branch 15, in Civil Case No. R-18521.
3
1
Civil Case No. R-18521 was for specific performance filed on 28

September 1979. In their complaint, 4 the MERCADERs alleged
that:chanrobles.com : virtuallawlibrary
(1) In 1966, Juan Maderazo applied for a loan at the DBP secured by
interior Lots Nos. 2993 and 2994 (Talisay-Minglanilla estate);
(2) The DPB required Maderazo to construct a five (5) - meter wide
road right of way over the adjoining Lot No. 2985;
(3) The DBP approved Maderazos loan application upon his
submission of a copy of the lease contract for a right of way over the
adjoining Lot No. 2985;
(4) The lease contract for the right of way was for a twenty-year period
commencing on 20 October 1966 which Maderazo executed with the
spouses Gelacio and Vicenta Manreal, then the registered owners of
Lot No. 2985;
(5) Maderazo expended P10,000 for the construction of the five (5) meter right of way;
(6) This lease contract was however not registered for Gelacio
Manreals failure, "for one reason or another," to deliver the Certificate
of Title (TCT) of Lot No. 2985 to Maderazo;
(7) About nine years later or on 6 January 1976, Maderazos children,
the spouses Florina Maderazo-Mercader and Bernardo Mercader
executed a contract of lease with the Manreals for a period of twenty
years and four months over the remaining portion of Lot No. 2985;
(8) Despite repeated requests for the delivery of the TCT of Lot No.
2985 for the purpose of annotating the lease contract, the Manreals,
"for one reason or another," failed to do so; however, the Manreals
assured the Mercaders "not to worry since nothing will go wrong" ;
(9) Believing in the Manreals assurances, Bernardo Mercader
intensively cultivated Lot No. 2985, "planted in good faith 600
calamansi fruit trees, fenced the lot with barbed wires, constructed
canals and drainage, spent wages for several farm workers and
introduced several improvements including a vegetable garden all
in the sum of not less that P25,000" ;

(10) The MERCADERs subsequently discovered that the reason why
the Manreals failed to deliver the TCT of Lot No. 2985 [now registered
in the names of spouses Felipe and Florentina Manreal, children of
Gelacio and Vicenta Manreal] was because they offered said lot
including the improvements introduced by the former thereon as
"collateral" for a P150,000 deep-sea fishing loan with the DBP;
(11) That despite the lack of registration and/or annotation of the
respective interests of the MERCADERs on the TCT over Lot No.
2985, the DBP knew and should know of their existence considering
the several ocular inspection and investigation conducted over the
property; the DBPs actual knowledge of these unregistered interests
has the effect of registration. 5
Since the Manreals defaulted in the payment of their obligation to the
DBP, and that the latter had taken steps to foreclose Lot No. 2985
including all the improvements thereon, the MERCADERs prayed
among others, for the DBP to "respect their interests by excluding
these from the foreclosure proceedings, or if the foreclosure takes
place, declare the same null and void or in the alternative, order the
DBP to reimburse them the cost of the improvements and loss of
expected income amounting to P210,000 for the duration of the
unexpired term of their respective contracts." The MERCADERs also
prayed for the annotation of their interests in the TCT of Lot No.
2985.chanrobles virtuallawlibrary
In their answer, the Manreals only admitted the existence of the two
unregistered contracts of lease and the calamansi trees planted on
Lot No. 2985. They then denied any knowledge or information
sufficient to form a belief on the other allegations of the MERCADERs.
They then claimed that Felipe Manreal informed Juan Maderazo of
the intention to offer as security Lot No. 2985 for the deep sea-fishing
loan with the DBP. They also justified their inability to present to the
MERCADERs the TCT over Lot No. 2985 on the fact that at the time
the latter were soliciting the titles delivery, it was still in the hands of
the lawyer who was preparing the Extrajudicial Settlement and
Partition of the Estate left by the deceased Vicenta Manreal. The
Manreals then prayed for the dismissal of the complaint for being
utterly groundless. 6
2
(1) the loan of spouses Juan and Juana Maderazo; and
respect be accorded to the contract of lease the MERCADERs

executed with the Manreals, or as an alternative allow the
MERCADERs to purchase Lot No. 2985 on installment basis at the
price of P6.00 per square meter; 13
(2) the deep-sea fishing loan of spouses Felipe and Florentina

Manreal which was secured among others, by a first mortgage over
Lot No. 2985 evidenced by a TCT already registered in their names,
free from any lien or encumbrance.
(2) a letter dated 22 July 1982 wherein the DBP through its Manager
(Mr. Manuel Roa) offered the MERCADERs three options by which
they could amicably settle subject to the approval of the Board of
Governors of the Bank to wit: 14
It denied any knowledge or information of: (1) any flaw or infirmity in

the TCT over Lot No. 2985; (2) any interest in Lot No. 2985 other than
and adverse to the spouses Felipe and Florentina Manreal as
registered owners and mortgagors; and (3) the existence of the lease
contract for right of way over a portion of Lot No. 2985 because it was
not registered and that the spouses Gelacio and Vicenta Manreal
were not the ones who mortgaged said Lot No. 2985 to the DBP but
their children, the spouses Felipe and Florentina Manreal.
a. First Option Sale
In its answer, the DBP admitted:chanrob1es virtual 1aw library
P96,200.00 Purchase price

19,200.00 Down payment
77,000.00 Balance payable in 10 years at 15% interest per annum
1, 242.28 Monthly amortization
The DBP maintained that the alleged unregistered interests of the

MERCADERs did not and could not bind the DBP per Art. 1648 of the
Civil Code 7 and Section 64 of Act 496. 8 It then prayed for the
dismissal of the complaint for being premature and for lack of cause of
action as it never dealt with Gelacio Manreal and there was as yet no
foreclosure. Besides, the DBP was a mortgagee in good faith. 9
b. Second Option Lease-Purchase

P132,598.84 Consideration
1,105.00 Monthly lease-purchase for 10 years
In the meantime or on 26 November 1979, Lot No. 2985 was sold,

among the other mortgaged lots, on public auction to the DBP as the
highest bidder. 10
c. Third Option Lease
During the pre-trial stage, the trial court acknowledged the possibility
of a compromise agreement, gave time to the parties to study their
proposals and counter-proposals and ordered the documents
pertinent thereto deemed parts of the record of the case. 11 Orders
were further issued "giving the parties more time to continue with their
negotiations and re-setting the hearing of the case." 12 Several
communications were thereafter exchanged, to
wit:chanrobles.com.ph:red
1,202.50 Monthly lease
(1) a letter dated 24 June 1981 wherein the MERCADERs proposed

that Maderazos contract of lease for right of way be registered, and
P14,430.00 Equivalent to 15% annual interest of P96,200
(3) a letter dated 18 November 1982 whereby the MERCADERs

chose option 2 (lease-purchase); 15
(4) a letter dated 23 November 1982 whereby the MERCADERs
informed the DBPs Manager that they were "depositing P3,315.00
with the bank" pursuant to said Managers proposal that a threemonth advance payment should be deposited while the MERCADERs
await the final decision of the bank on the proposed settlement. 16
3
The DBP issued an official receipt for the payment of P3,315 as

"earnest money, deposit to purchase lot 2985." 17
With this development, on 9 December 1982, the trial court directed
the parties to submit "their compromise agreement which required the
approval of the Board of Governors." 18
The DBP and the MERCADERs thereafter again exchanged a series
of correspondences. In his 13 January 1983 letter to the DBP (through
Mr. Ruben Carpio), Bernardo Mercader requested for a grace period
in the payment of the amortization for the lease-purchase option. 19 In
response, the DBP wrote a letter dated 19 January 1983 informing
Bernardo Mercader that it had already "prepared [its] recommendation
to the head office, . . . rejected the request for a grace period but
informed [him] to respond soon or visit the bank for a possible
conference." 20 Bernardo Mercader replied through a letter dated 5
October 1983 reiterating his accord to the lease-purchase option but
suggesting this time that the amortization be paid on a quarterly basis.
21 In its 29 February 1984 letter, the DBP "noted" Mercaders
suggestion as "counter-proposals or counter-offers which [it find
un]acceptable and made dimmer the realization of [their] mutual
desire for an early amicable settlement." The DBP reasoned that "the
original conditions packaged in [its] proposal [were] no longer
applicable" considering that the market value of the property
increased. 22
With this, the trial court ordered the termination of the pre-trial and set
the case for hearing in its 18 September 1995 order, thus:chanrob1es
virtual 1aw library
As manifested by the plaintiffs, they have alread[y] agreed with the
defendant bank that they will pay the property at P132,598 payable in
ten (10) years in quarterly basis. However, the counsel of defendant
manifested that it was only a proposal. The plaintiff spouses
requested for a longer period of fifteen (15) years which the bank did
not agree.chanrobles.com : red
The only issue[s] to be resolved in this case are as
follows:chanrob1es virtual 1aw library
1. Whether the plaintiff [are] entitled to specific performance of said
agreement;
2. Whether the defendant bank can be compelled to recognize the
lease contract entered into between the spouses plaintiff Bernardo
Mercader and Gelacio Manreal; and
3. Whether the foreclosure proceedings of the contract between the
defendant bank is null and void.
The pre-trial in this case is already closed and terminated. 23
On 7 November 1985, the MERCADERs filed a Supplemental
Pleading insisting the consummation of the lease-purchase option
with the payment of the earnest money. 24 The DBP filed its
Opposition to the Supplemental Pleading.25cralaw:red
Trial proceeded with the parties presenting evidence tending to
establish their respective allegations. On 29 May 1987, the trial court
ordered the Manreals dropped from the case. The MERCADERs
offered no objection.
In its decision of 6 September 1988, the trial court reiterated the three
issues ascertained in the pre-trial order and resolved all of them in
favor of the MERCADERs. On the first issue, the trial court found that
the "DBP had unnecessarily and unjustifiably made . . . [Bernardo]
Mercader understand that his second option [lease-purchase] would
be more or less approved, except that the approval will come from
Manila." 26 Anent the second issue, the trial court also believed "quite
firmly" that the "DBP could not have escaped having a foreknowledge
of the existence of the prior unrecorded lease" as the "possession and
cultivation of Bernardo Mercader . . . [was] a matter of open, notorious
and public knowledge in the area." In resolving the third issue, the
court first acknowledged that it is a "court of equity and not merely a
court of law" and the "DBP is not authorized to keep real propert[y]
longer than ten years or so;" then the court "required [the] DBP to set
aside the area affected by the prior unregistered lease, known to [it],
when [it] accepted the mortgage." 27 It then decreed as
follows:chanrob1es virtual 1aw library
WHEREFORE, finding the preponderance of evidence to be in favor
of plaintiffs, judgment is hereby rendered as follows:chanrob1es
4
virtual 1aw library

1) ordering the defendant DBP and its successors-in-interest to
respect and preserve the Contracts of Lease between the Manreals
and the Mercaders until December 31, 1994;
2) ordering the DBP to exclude from the foreclosure proceedings the
rights of the plaintiffs as covered by the Contract of Lease;
3) requiring the defendant DBP to cause the annotation of the
Contracts of Lease of plaintiffs on TCT No. T-40396 of . . . Lot No.
2985 . . . and amend Entry No. 4980-V-14-D-B, by excluding the
improvements of Mercader as guarantee or collateral for defendant
Felipe Manreals deep-sea fishing loan;chanrobles.com : red
4) ordering the DBP to execute the deed of sale subject to the
approval of the Manila Office of the DBP as to the mode of payment,
there being no agreement thereon;
5) requiring the defendant DBP to pay attorneys fees of P5,000, for
making it necessary for the plaintiffs to litigate, in order to protect their
rights to the Lease Contract with the Manreals and to compel DBP to
act on the proposals of Mercader as promised by DBP. 28
On appeal, the Court of Appeals found that the trial court erred in
treating the lease-purchase option as a controversial issue
considering that it was "outside the parties pleadings." But invoking
the Supreme Courts decision in Castro v. Court of Appeals 29 in that
"the improvements introduced [into the mortgaged property] are to be
considered so incorporated [in the mortgage] only if so owned by the
mortgagor," the Court of Appeals declared that the improvements
introduced on Lot No. 2985 had been improperly included in the
foreclosure sale since they were not owned by the mortgagors. But
since the improvements were already included in the foreclosure sale
and the MERCADERs continued the possession and collection of
income from the lot, the Court of Appeals, as already earlier adverted
to, reversed and set aside the appealed judgment. It entered a new
one declaring that the MERCADERs were not entitled to any
compensation from the DBP. It also ordered the MERCADERs to
immediately turn over the possession of Lot No. 2985 to the DBP. 30
In this petition for review, the MERCADERs assert that in issuing the
challenged decision, the Court of Appeals contravened Section 4,
Rule 20 and Section 5, Rule 10 of the Rules of Court by holding that
the trial court should not have taken cognizance of the lease-purchase
option as a controversial issue since it was not raised in the
pleadings. They maintain that the trial court correctly took cognizance
of the lease-purchase option because it was part and parcel of the
pre-trial stages, the determination of which will prevent future litigation
thereon. They also pray that in the event of a favorable judgment, this
Court should refer the case back to the Court of Appeals for a
determination of whether the trial court erred in finding that the leasepurchase option was already consummated.
For its part, the DBP contends that the MERCADERs raise questions
of facts which are not reviewable on appeal and that it had opposed
and objected to in and at all stages of the trial, all attempts by the
MERCADERs to introduce evidence on the lease-purchase
option.chanrobles virtua| |aw |ibrary
This Court agrees with the MERCADERs and finds that the Court of
Appeals erred in disregarding as material the lease-purchase option
on the ground that it was not raised in the pleadings. If the Court of
Appeals adverts to the lack of reference to the lease-purchase option
in the initiatory pleadings, this can be simply explained by the fact that
the trial court only took cognizance thereof when it became an integral
component of the pre-trial proceedings. That is why the leasepurchase option was included firstly, in the pre-trial order as one of the
issues to be resolved at trial and secondly, in the supplemental
pleading subsequently filed by the MERCADERs on 7 November
1985. 31 As a supplemental pleading, it served to aver supervening
facts which were then not ripe for judicial relief when the original
pleading was filed. As such, it was meant to supply deficiencies in aid
of the original pleading, and not to dispense with the latter. 32 Hence,
it was patently erroneous for the Court of Appeals to pronounce that
the lease-purchase option was not raised in the pleadings. The DBP
was even quite aware and knowledgeable of the supplemental
pleading because it filed an opposition thereto. 33
The records however reveal that the trial court did not promptly rule
on the motion to admit the supplemental pleading. And during trial, the
trial court also failed to rule on the prompt objection interposed by the
5
DBPs counsel to the MERCADERs introduction of evidence relative

to said lease-purchase option. But undisputed is the trial courts
eventual admission in open court of the MERCADERs supplemental
pleading, thus:chanrob1es virtual 1aw library
COURT
What is your opposition, the price agreed upon?
ATTY. GARLITOS
ATTY. GARLITOS
Probably, I did not make myself quite clear, Your honor. What I mean
is during the pre-trial stage the parties were encourage to negotiate
for a settlement. So they made an offer to DBP and DBP gave them
an option.
We objected to the filing of the supplemental complaint and to all

evidence presented in regard to that supplemental
complaint.chanroblesvirtual|awlibrary
COURT
COURT
Those three options and chose the second one.
Its too late now for you to make an objection. This supplemental
pleading has been admitted by the court. That has become final.
ATTY. GARLITOS
ATTY. GARLITOS.
We interposed an objection on this option, Your Honor, because any

evidence which will be presented or which transpired during the pretrial is objectionable. So we interposed an objection to prevent the
witness from testifying on transactions which were referred to while
the parties were negotiating during the pre-trial stage.
There is no showing that it has been admitted by the court.
ATTY. MERCADER
The records also show that not only did the DBPs counsel began to
rigorously cross-examine Bernardo Mercader on the lease-purchase
option, he also subjected his witness Mr. Ruben Carpio, then Chief of
the Collection Department, DBP to an intensive direct examination
covering said subject matter. 35 He also offered as evidence the
DBPs letter indicating the three options to the MERCADERs as
Exhibit "1" and the lease-purchase option contained therein as Exhibit
"1-A." 36
I wish to correct counsel. Records will show that there was no

objection on what transpired during the pre-trial. As a matter of fact
the pre-trial order is very material to the case. There is a pre-trial that
such an offer and three options made by DBP, and that plaintiff
selected the second option and that he deposited earnest money with
the bank.chanroblesvirtuallawlibrary
COURT
In other words there is no supplemental complaint.
COURT
It has been admitted by the court. 34 (Emphasis supplied)
The DBP is undoubtedly estopped from questioning the trial courts

inclusion of the lease-purchase option as a controversial issue. This
action of the trial court finds anchor on Section 4, Rule 20 of the Rules
of Court which reads:chanrob1es virtual 1aw library
ATTY. GARLITOS
It is good that they brought that out because we had an opposition
and this is what I am referring to.
SECTION 4. Record of pre-trial results. After the pre-trial the court

shall make an order which recites the action taken at the conference,
the amendments allowed to the pleadings, and the agreements made
6
by the parties as to any of the matters considered. Such order shall

limit the issues for trial to those not disposed of by admissions or
agreements of counsel and when entered controls the subsequent
course of the action, unless modified before trial to prevent manifest
injustice.chanrobles virtual lawlibrary
Indeed, the pre-trial is primarily intended to make certain that all
issues necessary to the disposition of a case are properly raised. The
purpose is to obviate the element of surprise, hence, the parties are
expected to disclose at the pre-trial conference all issues of law and
fact which they intend to raise at the trial, except such as may involve
privileged or impeaching matter. 37 In the case at bar, the pre-trial
order included as integral to the complete adjudication of the case the
issue of whether the MERCADERs can demand specific performance
from the DBP relative to the lease-purchase option. Thus, the element
of surprise that the provision on pre-trial attempts to preclude was
satisfied. The surprise factor was further eliminated, as already earlier
mentioned and merely to reiterate here, with the DBPs (1) motion to
oppose the supplemental pleading, (2) objection to the introduction of
evidence connected thereto, (3) later information from the trial court of
its definitive ruling admitting the supplemental pleading, (4) own
introduction of evidence related thereto, and finally, by its (5) intensive
participation in the direct and cross-examination of witnesses whose
testimonies included said topic. In any case, the filing and consequent
admission of the supplemental pleading by the trial court validated the
issues embraced in the pre-trial order.chanrobles.com.ph:red
Assuming arguendo that the MERCADERs failed to file the
supplemental pleading, evidence relative to the lease-purchase option
may be legitimately admitted by the trial court in conformity with
Section 5, Rule 10 of the Rules of Court which states:chanrob1es
virtual 1aw library
SECTION 5. Amendment to conform to or authorize presentation of
evidence. When issues not raised by the pleadings are tried by
express or implied consent of the parties, they shall be treated in all
respects, as if they had been raised in the pleadings. Such
amendment of the pleadings as may be necessary to cause them to
conform to the evidence and to raise these issues may be made upon
motion of any party at any time, even after judgment; but failure so to
amend does not affect the result of the trial of these issues. If
evidence is objected to at the trial on the ground that it is not within

the issues made by the pleadings, the court may allow the pleadings
to be amended and shall do so freely when the presentation of the
merits of the action will be subserved thereby and the objecting party
fails to satisfy the court that the admission of such evidence would
prejudice him in maintaining his action or defense upon the merits.
The court may grant a continuance to enable the objecting party to
meet such evidence. (Emphasis supplied)
This provision envisions two scenarios first, when evidence is
introduced on an issue not alleged in the pleadings and no objection
was interjected and second, when evidence is offered again, on an
issue not alleged in the pleadings but this time an objection was
interpolated. We are concerned with the second scenario. In Co
Tiamco v. Diaz, the Court held that "when evidence is offered on a
matter not alleged in the pleadings, the court may admit it even
against the objection of the adverse party, where the latter fails to
satisfy the court that the admission of the evidence would prejudice
him in maintaining his defense upon the merits, and the court may
grant him a continuance to enable him to meet the new situation
created by the evidence. Of course, the court, before allowing the
evidence, as a matter of formality, should allow an amendment of the
pleading, . . . And, furthermore, where the failure to order an
amendment does not appear to have caused surprise or prejudice to
the objecting party, it may be allowed as a harmless error. Well-known
is the rule that departures from procedure may be forgiven where they
do not appear to have impaired the substantial rights of the parties."
38chanrobles virtuallawlibrary
More recently, in Bank of America v. American Realty Corporation 39
citing Talisay-Silay Milling Co., Inc. v. Asociacion de Agricultores de
Talisay-Silay, Inc., 40 the Court reinforces the Co Tiamco ruling on the
application of Section 5, Rule 10 of the Rules of Court in this
wise:chanrobles.com : law library
The failure of a party to amend a pleading to conform to the evidence
adduced during trial does not preclude adjudication by the court on
the basis of such evidence which may embody new issues not raised
in the pleadings. . . . Although, the pleading may not have been
amended to conform to the evidence submitted during trial, judgment
may nonetheless be rendered, not simply on the basis of the issues
7
alleged but also on the issues discussed and the assertions of fact
proved in the course of the trial. The court may treat the pleading as if
it had been amended to conform to the evidence, although it had not
been actually amended. . . .Clearly, a court may rule and render
judgment on the basis of the evidence before it even though the
relevant pleading had not been previously amended, so long as no
surprise or prejudice is thereby caused to the adverse party. Put a
little differently, so long as the basic requirements of fair play had
been met, as where the litigants were given full opportunity to support
their respective contentions and to object to or refute each others
evidence, the court may validly treat the pleadings as if they had been
amended to conform to the evidence and proceed to adjudicate on the
basis of all the evidence before it.
As already enunciated, the DBP was not and would not be prejudiced
by the incorporation of the lease-purchase option as one of the
controverted issues. Moreover, it had been afforded ample opportunity
to refute and object to the evidence germane thereto, thus, the
rudiments of fair play had been properly observed.
Since we agree with the MERCADERs contention that the Court of
Appeals contravened Section 4, Rule 20 and Section 5, Rule 10 of the
Rules of Court in promulgating the questioned decision, we have to
grant their prayer to refer the matter back to said court for a
determination of the question of whether the lease-purchase option
was already consummated and for a complete ascertainment of the
rights and obligations of the parties.chanrobles.com.ph : red
WHEREFORE, IN VIEW OF ALL THE FOREGOING, the instant
petition is GRANTED DUE COURSE and the 5 February 1997
judgment and 13 August 1995 resolution of the Court of Appeals in
CA-GR-CV No. 21846 are hereby SET ASIDE. The case is
REFERRED BACK to the Court of Appeals for a determination of
whether the lease-purchase option was consummated with the end
view of ascertaining the rights and obligations of the
parties.chanroblesvirtual|awlibrary
Privileged Documents
Air Philippines vs Pennswell Inc.

Facts:
Petitioner is a domestic corporation engaged in the business of air
transportation services. While,
respondent was organized to engage in the business of
manufacturing and selling industrial chemicals,
solvents, and special lubricants. In particular, petitioner alleged that it
was defrauded by respondent for its
previous sale. Petitioner seeks to convince this Court that it has a
right to obtain the chemical composition
and ingredients of respondents products to conduct a comparative
analysis of its products
Issue: Can chemical components of Pennswell products be accessed
pursuant to RA 7394, 8203,
6969 and right to information under Sec. 7, Art III?
Held: No.
Jurisprudence has consistently acknowledged the private character of
trade secrets. There is a privilege
not to disclose ones trade secrets. Foremost, this Court has declared
that trade secrets and banking
transactions are among the recognized restrictions to the right of the
people to information as embodied
in the Constitution.
Facts:
Held: No.
8

Facts:
Held: No.
Facts:

Held: No.
Facts:
Facts:
9

Facts:
Facts:
solvents, and special lubricants.
Facts:
transportation services

people to information as embodied in the Constitution.
Facts:
transportation services. While, respondent was organized to engage
in the business of manufacturing and selling industrial chemicals,
was defrauded by respondent for its previous sale. Petitioner seeks to
convince this Court that it has a right to obtain the chemical
composition and ingredients of respondents products to conduct a
comparative analysis of its products
Republic Act No. 6969, or the Toxic Substances and Hazardous and
Nuclear Wastes Control Act of 1990, also contains a provision that
limits the right of the public to have access to records, reports or
information concerning chemical substances and mixtures including
safety data submitted and data on emission or discharge into the
environment, if the matter is confidential such that it would divulge
trade secrets, production or sales figures; or methods, production or
processes unique to such manufacturer, processor or distributor; or
would otherwise tend to affect adversely the competitive position of
such manufacturer, processor or distributor.

pursuant to RA 7394, 8203, 6969 and right to information under Sec.
7, Art III?
Held: No.
trade secrets. There is a privilege not to disclose ones trade secrets.
Foremost, this Court has declared that trade secrets and banking
Petitioner cannot rely on Section 77 of Republic Act 7394, or the

Consumer Act of the Philippines, in order to compel respondent to
reveal the chemical components of its products. While it is true that all
consumer products domestically sold, whether manufactured locally
or imported, shall indicate their general make or active ingredients in
their respective labels of packaging, the law does not apply to
respondent. Respondents specialized lubricants are not consumer
products. Its products are not intended for personal, family, household
or agricultural purposes. Rather, they are for industrial use,
specifically for the use of aircraft propellers and engines.
Petitioners argument that Republic Act No. 8203, or the Special Law
on Counterfeit Drugs, requires the disclosure of the active ingredients
of a drug is also on faulty ground. Respondents products are outside
the scope of the cited law. They do not come within the purview of a
drug which, as defined therein, refers to any chemical compound or
biological substance, other than food, that is intended for use in the
treatment, prevention or diagnosis of disease in man or animals.
Again, such are not the characteristics of respondents products.
Trade secrets should receive greater protection from discovery,

because they derive economic value from being generally unknown
and not readily ascertainable by the public.
Facts:
Petitioner Air Philippines Corporation is a domestic corporation
engaged in the business of air transportation services. On the other
hand, respondent Pennswell, Inc. was organized to engage in the
10
business of manufacturing and selling industrial chemicals, solvents,

and special lubricants.
Respondent delivered and sold to petitioner sundry goods in trade.
Under the contracts, petitioners total outstanding obligation amounted
to P449,864.98 with interest at 14% per annum until the amount
would be fully paid. For failure of the petitioner to comply with its
obligation under said contracts, respondent filed a Complaint for a
Sum of Money on 28 April 2000 with the RTC.
In its Answer, petitioner alleged that it was defrauded in the amount of
P592,000.00 by respondent for its previous sale of four items.
Petitioner asserted that it was deceived by respondent which merely
altered the names and labels of such goods. Petitioner asseverated
that had respondent been forthright about the identical character of
the products, it would not have purchased the items complained of.
Moreover, petitioner alleged that when the purported fraud was
discovered, a conference was held between petitioner and respondent
on 13 January 2000, whereby the parties agreed that respondent
would return to petitioner the amount it previously paid. However,
petitioner was surprised when it received a letter from the respondent,
demanding payment of the amount of P449,864.94, which later
became the subject of respondents Complaint for Collection of a Sum
of Money against petitioner.
During the pendency of the trial, petitioner filed a Motion to Compel
respondent to give a detailed list of the ingredients and chemical
components of the following products. The RTC rendered an Order
granting the petitioners motion.
Respondent sought reconsideration of the foregoing Order,
contending that it cannot be compelled to disclose the chemical
components sought because the matter is confidential. It argued that
what petitioner endeavored to inquire upon constituted a trade secret
which respondent cannot be forced to divulge.
The RTC gave credence to respondents reasoning, and reversed
itself. Alleging grave abuse of discretion on the part of the RTC,
petitioner filed a Petition for Certiorari under Rule 65 of the Rules of
Court with the Court of Appeals, which denied the Petition and
affirmed the Order dated 30 June 2004 of the RTC. Petitioners Motion
for Reconsideration was denied. Unyielding, petitioner brought the
instant Petition before SC.
Issue:
W/N CA erred in upholding RTC decision denying petitioners motion
to subject respondents products to compulsory disclosure.
Held:
No. The products are covered by the exception of trade secrets being
divulged in compulsory disclosure. The Court affirms the ruling of the
Court of Appeals which upheld the finding of the RTC that there is
substantial basis for respondent to seek protection of the law for its
proprietary rights over the detailed chemical composition of its
products.
The Supreme Court has declared that trade secrets and banking
people to information as embodied in the Constitution. SC said that
the drafters of the Constitution also unequivocally affirmed that, aside
from national security matters and intelligence information, trade or
industrial secrets (pursuant to the Intellectual Property Code and other
related laws) as well as banking transactions (pursuant to the Secrecy
of Bank Deposits Act), are also exempted from compulsory disclosure.
A trade secret is defined as a plan or process, tool, mechanism or
compound known only to its owner and those of his employees to
whom it is necessary to confide it. The definition also extends to a
secret formula or process not patented, but known only to certain
individuals using it in compounding some article of trade having a
commercial value. American jurisprudence has utilized the following
factors to determine if an information is a trade secret, to wit:
(1) the extent to which the information is known outside of the
employers business;
(2) the extent to which the information is known by employees and
others involved in the business;
(3) the extent of measures taken by the employer to guard the
secrecy of the information;
(4) the value of the information to the employer and to competitors;
(5) the amount of effort or money expended by the company in
developing the information; and
(6) the extent to which the information could be easily or readily
obtained through an independent source.
Rule 27 sets an unequivocal proviso that the documents, papers,
books, accounts, letters, photographs, objects or tangible things that
may be produced and inspected should not be privileged. The
documents must not be privileged against disclosure. On the ground
of public policy, the rules providing for production and inspection of
books and papers do not authorize the production or inspection of
privileged matter; that is, books and papers which, because of their
confidential and privileged character, could not be received in
11
evidence. Such a condition is in addition to the requisite that the items

be specifically described, and must constitute or contain evidence
material to any matter involved in the action and which are in the
partys possession, custody or control.
In the case at bar, petitioner cannot rely on Section 77of Republic Act
7394, or the Consumer Act of the Philippines, in order to compel
respondent to reveal the chemical components of its products. While
it is true that all consumer products domestically sold, whether
manufactured locally or imported, shall indicate their general make or
active ingredients in their respective labels of packaging, the law does
not apply to respondent. Respondents specialized lubricants
namely, Contact Grease, Connector Grease, Thixohtropic Grease, DiElectric Strength Protective Coating, Dry Lubricant and Anti-Seize
Compound are not consumer products.
What is clear from the factual findings of the RTC and the Court of
Appeals is that the chemical formulation of respondents products is
not known to the general public and is unique only to it. Both courts
uniformly ruled that these ingredients are not within the knowledge of
the public. Since such factual findings are generally not reviewable by
this Court, it is not duty-bound to analyze and weigh all over again the
evidence already considered in the proceedings below.
The revelation of respondents trade secrets serves no better purpose
to the disposition of the main case pending with the RTC, which is on
the collection of a sum of money. As can be gleaned from the facts,
petitioner received respondents goods in trade in the normal course
of business. To be sure, there are defenses under the laws of
contracts and sales available to petitioner. On the other hand, the
greater interest of justice ought to favor respondent as the holder of
trade secrets. Weighing the conflicting interests between the parties,
SC rules in favor of the greater interest of respondent. Trade secrets
should receive greater protection from discovery, because they derive
economic value from being generally unknown and not readily
ascertainable by the public.
Forms and contents (Sec. 3, Rule 21)
UNIVERSAL RUBBER PRODUCTS, INC.,
Petitioner,
G. R. No. L-30266
June 29, 1984

-versusHON. COURT OF APPEALS,
CONVERSE RUBBER CORPORATION,
EDWARDSON MANUFACTURING CO., INC.chanrobles virtual law
library
and HON. PEDRO C. NAVARRO,
Respondents.
RESOLU TION
GUERRERO, J.:
This Petition for Review concerns a "subpoena duces tecum" which
was issued by the trial court against the Treasurer of the herein
petitioner, the propriety of which was upheld by the defunct Court of
Appeals [now Intermediate Appellate Court].
The facts of this case as stated in the decision of the then Court of
Appeals are as follows:
Records disclose that the two respondent corporations herein sued
the present petitioner before the Court of First Instance of Rizal for
unfair competition with damages and attorney's fees. In due time,
herein petitioner, who was the defendant in that court suit, answered
the complaint and joined issues with the plaintiffs therein, forthwith
respondent Judge, to whom that lawsuit was assigned, proceeded
with the trial thereof. After they have presented about nine witnesses
and various pieces of documentary evidence, herein private
respondents made a request to the respondent Judge to issue
a subpoena duces tecum against the treasurer of herein petitioner.
Acting favorably on that request, said respondent Judge issued
a subpoena duces tecum on February 13, 1968, directing the
treasurer of the present petitioner to bring with him to the lower court
on February 26, 1968 and March 8, 1968 at 2:30 p.m. ", all sales
invoices, sales books and ledgers wherein are recorded the sales of
Plymouth Star Player rubber shoes from the time the corporation
started manufacturing and selling said shoes up to the present.cralaw
On March 4, 1968, petitioner filed a motion in the court below praying
that thesubpoena duces tecum dated February 13, 1968 be quashed
on the grounds that: [1] the said subpoena is both unreasonable and
oppressive as the books and documents called for are numerous and
12
voluminous; [2] there is no good cause shown for the issuance

thereof; and [3] the books and documents are not relevant to the case
pending below. The private respondents herein opposed that motion
of the petitioner. Acting on the said motion and on the opposition
thereto, respondent Judge issued the first controverted order on May
6, 1968, denying the motion to quash the subpoena duces tecum.
On May 15, 1968, herein petitioner filed in the court a quo a motion for
reconsideration seeking the said court to reconsider its order denying
the motion to quash the subpoena duces tecum. This, too, was
opposed by the private respondents. Acting on this motion, as well as
on the opposition thereto, respondent Judge issued the second
controverted order on June 28, 1968, denying the motion for
reconsideration. Consequently, on August 6, 1968, petitioner
Universal Rubber Products, Inc. filed its present petition for certiorari
with preliminary injunction, alleging that in so denying its motion to
quash the subpoena duces tecum and its subsequent motion for
reconsideration, respondent Judge acted with grave abuse of
discretion amounting to an excess of jurisdiction. [1]
Pending the resolution of the appealed case, the Court of Appeals
issued on September 25, 1968 a temporary restraining order directing
the respondent Judge of the trial court to refrain from implementing
his order dated May 6, 1968 in Civil Case No. 9686. [2]
On November 12, 1968, the respondent Court rendered its Decision
denying the petition for certiorari filed by petitioner for lack of merit.
The dispositive portion of the said Decision reads: [3]
WHEREFORE, for lack of merit, the present petition for certiorari with
preliminary injunction is hereby denied and the temporary restraining
order issued by this Court on September 25, 1968 is now lifted, with
costs against the petitioner.
SO ORDERED.
Petitioner argues three errors to support his Petition, to wit: [4]
I.chanrobles virtual law library
The respondent Court erred when it found the fact of the petition and
its annexes as not demonstrating clear abuse of discretion by
respondent Judge.chanrobles virtual law library
II.chanrobles virtual law library
The respondent Court erred when it refused to sustain the contention
of petitioner that the issuance by the respondent judge of
thesubpoena duces tecum was an arbitrary exercise of judicial
power.chanrobles virtual law library
III.chanrobles virtual law library

The respondent Court erred when it did not consider the subpoena
duces tecum issued by the respondent Judge as a fishing bill when it
refused to order its quashal.chanrobles virtual law library
The issues summarized, We are called upon to answer whether the
issuance of the "subpoena duces tecum" is proper in a suit for unfair
competition.cralaw
Private respondent claims the affirmative because [1] the subpoena
duces tecum in question specifically designates the books and
documents that should be produced in court and they are 4 sales
invoices, sales books and ledgers where are recorded the sales of
Plymouth Star Player Rubber Shoes from the time the corporation
started manufacturing and selling shoes [that is from April 1, 1963] up
to the present; and [2] the relevancy of the books subject to the
controverted subpoena duces tecum cannot be seriously denied
because if and when herein respondent corporations are ultimately
adjudged to be entitled to recover compensatory damages from the
petitioner, there would be no factual basis for the amount of such
damages unless those books and documents are laid open for the
court's scrutiny.cralaw
On the other hand, petitioner submits a contrary opinion and insists
that the question of liability of petitioner should be determined first
before discovery by means of a subpoena duces tecum is allowed;
that respondent Converse is a foreign corporation not licensed to do
business in the Philippines and that Edwardson is merely its licensee;
that respondent Converse has no goodwill to speak of and that it has
no registrable right over its own names; that the questioned subpoena
duces tecum issued by respondent judge was merely a "Fishing Bill."
In the meantime, while this present petition remains pending before
this Court, petitioner manifested on April 2, 1977 [5] that their
establishment was totally burned together with all the records which is
sought to be produced in court by the questioned "subpoena duces
tecum" on May 3, 1970. In effect, it renders the present petition moot
and academic. However, the legal principles arising from the issues
deserve Our discussion and resolution.cralaw
As a general rule, on obtaining an injunction for infringement of a
trademark, complainant is entitled to an accounting and recovery of
defendant's profits on the goods sold under that mark, as incident to,
and a part of, his property right, and this rule applies in cases of unfair
competition. In such case, the infringer or unfair trader is required in
13
equity to account for and yield up his gains on a principle analogous

to that which charges as trustee with the profits acquired by the
wrongful use of the property of the cestui que trust, and defendant's
profits are regarded as an equitable measure of the compensation
plaintiff should receive for the past harm suffered by him. [6]
Well-settled is Our jurisprudence that, in order to entitle a party to the
issuance of a "subpoena duces tecum ", it must appear, by clear and
unequivocal proof, that the book or document sought to be produced
contains evidence relevant and material to the issue before the court,
and that the precise book, paper or document containing such
evidence has been so designated or described that it may be
identified. [7] A "subpoena duces tecum" once issued by the court,
may be quashed upon motion if the issuance thereof is unreasonable
and oppressive or the relevancy of the books, documents or things
does not appear, or if the persons in whose behalf the subpoena is
issued fails to advance the reasonable cost of production thereof. [8]
In the instant case, in determining whether the books subject to
the subpoena duces tecum are relevant and reasonable in relation to
the complaint of private respondent for unfair competition, We have to
examine Republic Act No. 166, which provides:
Chapter V. Rights and Remedies
xxx xxx xxx
Sec. 23. Actions, and damages and injunction for infringement. - Any
person entitled to the exclusive use of a registered mark or trade
name may recover damages in a civil action from any person who
infringes his rights and the measure of the damages suffered shall be
either the reasonable profit which the complaining party would have
made, had the defendant not infringed his said rights, or the profit
which the defendant actually made out of the infringment
management, or in the event such measure of damages cannot be
readily ascertained with reasonable certainty, then the court may
award as damages a reasonable percentage based upon the amount
of gross sales of the defendant of the value of the services in
connection with which the mark or trade name was used in the
infringement of the rights of the complaining party. In cases where
actual intent to mislead the public or to defraud the complaining party
shall be shown in the discretion of the court, the damages may be
doubled.
The complaining party, upon proper showing may also be granted
injunction.
In recovering the loss suffered by the aggrieved party due to unfair

competition," Sec. 23 of R. A. 166 [9] grants the complainant three
options within which to ascertain the amount of damages recoverable,
either [1] the reasonable profit which the complaining party would
have made, had the defendant not infringed his said rights; or [2] the
profit which the defendant actually made out of the infringement; or [3]
the court may award as damages a reasonable percentage based
upon the amount of gross sales of the defendant or the value of the
services in connection with which the mark or tradename was issued
in the infringement of the rights of the complaining party.
In giving life to this remedial statute, We must uphold the order of the
court a quo denying the motion of the petitioner to quash
the "subpoena duces tecum" previously issued against the petitioner.
In a suit for unfair competition, it is only through the issuance of the
questioned "subpoena duces tecum" that the complaining party is
afforded his full rights of redress.cralaw
The argument that the petitioner should first be found guilty unfair
competition before an accounting for purposes of ascertaining the
amount of damages recoverable can proceed, stands without
meritThe complaint for unfair competition is basically a suit for
"injunction and damages." [10] Injunction, for the purpose of enjoining
the unlawful competitor from proceeding further with the unlawful
competition, and damages, in order to allow the aggrieved party to
recover the damage he has suffered by virtue of the said unlawful
competition. Hence, the election of the complainant [private
respondent herein] for the accounting of petitioner's [defendant below]
gross sales as damages per R. A. 166, appears most relevant. For
Us, to determine the amount of damages allowable after the final
determination of the unfair competition case would not only render
nugatory the rights of complainant under Sec. 23 of R. A. 166, but
would be a repetitious process causing only unnecessary delay.cralaw
The sufficiency in the description of the books sought to be produced
in court by the questioned "subpoena duces tecum" is not disputed in
this case, hence, We hold that the same has passed the test of
sufficient description.cralaw
Petitioner also assails that private respondent is a foreign corporation
not licensed to do business in the Philippines and that respondent
Edwardson is merely its licensee; that respondent Converse has no
goodwill to speak of and that it has no registrable right over its own
name. We have already answered this issue squarely in Our decision
14
of the case of Converse Rubber Corporation vs. Jacinto Rubber &

Plastic Co., Inc., [11] where We explained:
The disability of a foreign corporation from suing in the Philippines is
limited to suits to enforce any legal of contract rights arising from, or
growing out, of any business which it has transacted in the Philippine
Islands. On the other hand, where the purpose of the suit is "to protect
its reputation, its corporate name, its goodwill, whenever that
reputation, corporate name or goodwill have, through the natural
development of its trade, established themselves", an unlicensed
foreign corporation may sue in the Philippines. So interpreted by the
Supreme Court, it is clear that Section 29 of the Corporation Law does
not disqualify plaintiff-appellee Converse Rubber, which does not have
a branch office in any part of the Philippines and is not "doing
business" in the Philippines, from filing and prosecuting this action for
unfair competition.
As We said earlier, the establishment of the petitioner burned down
together with all the records sought to be produced by the
questioned "subpoena duces tecum," hence, this case has become
moot and academic. We have no recourse but to dismiss the same.
WHEREFORE, the instant petition is dismissed for becoming moot
and academic. No costs.cralaw
SO ORDERED.cralaw
[G.R. NO. 158275 : June 28, 2005]
DOMINGO ROCO, Petitioner, v. HON. EDWARD B. CONTRERAS,
PEOPLE OF THE PHILIPPINES and CAL'S POULTRY SUPPLY
CORPORATION, Respondents.
DECISION
GARCIA, J.:
Assailed and sought to be set aside in this appeal by way of a Petition
for Review on Certiorari under Rule 45 of the Rules of Court are the
following issuances of the Court of Appeals in CA-G.R. SP No. 66038,
to wit:
1. Decision dated 20 August 2002,1 dismissing the appeal filed by
herein petitioner Domingo Roco contra the 18 October 2000
resolution of the Regional Trial Court (RTC) at Roxas City, denying
due course to and dismissing his petition for certiorari in SP Case No.
7489; andcralawlibrary
2. Resolution dated 12 May 2003,2 denying petitioner's motion for

reconsideration.
The material facts are not at all disputed:
Petitioner Domingo Roco was engaged in the business of buying and
selling dressed chicken. Sometime in 1993, he purchased his supply
of dressed chicken from private respondent Cal's Poultry Supply
Corporation (Cal's Corporation, for short), a domestic corporation
controlled and managed by one Danilo Yap. As payment for his
purchases, petitioner drew five (5) checks payable to Cal's
Corporation against his account with the Philippine Commercial and
Industrial Bank (PCIB), which checks bear the following particulars:
Check No.
Date
Amount
004502
26 April 1993
P329,931.40
004503
4 May 1993
P319,314.40
004507
19 May 1993
P380,560.20
004511
26 May 1993
P258,660.20
004523
22 May 1993
P141,738.55.
Cal's Corporation deposited the above checks in its account with

PCIB but the bank dishonored them for having been drawn against a
closed account. Thereafter, Cal's Corporation filed criminal complaints
against petitioner for violation of Batas Pambasa Blg. 22 (BP 22),
otherwise known as the Bouncing Checks Law.
After preliminary investigation, five (5) informations for violation of BP
22 were filed against petitioner before the Municipal Trial Court in
Cities (MTCC), Roxas City, thereat docketed as Crim. Cases No. 942172-12 to 94-2176-12, all of which were raffled to Branch 2 of said
court.
Meanwhile, and even before trial could commence, petitioner filed
with the Bureau of Internal Revenue (BIR) at Iloilo City a denunciation
letter against Cal's Corporation for the latter's alleged violation of
Section 258 in relation to Section 263 of the National Internal
Revenue Code in that it failed to issue commercial invoices on its
sales of merchandise. Upon BIR's investigation, it was found that
Cal's Corporation's sales on account were unavoidable, hence, the
corporation had to defer the issuance of "Sales Invoices" until the
purchases of its customers were paid in full. With respect to the sales
15
invoices of petitioner, the investigation disclosed that the same could

not, as yet, be issued by the corporation precisely because the checks
drawn and issued by him in payment of his purchases were
dishonored by PCIB for the reason that the checks were drawn
against a closed account. Accordingly, the BIR found noprima
facia evidence of tax evasion against Cal's Corporation.3
Thereupon, trial of the criminal cases proceeded. After the
prosecution rested, the MTCC declared the cases submitted for
decision on account of petitioner's failure to adduce evidence in his
behalf. Later, the same court rendered a judgment of conviction
against petitioner.
Therefrom, petitioner went on appeal to the Regional Trial Court,
contending that he was unlawfully deprived of his right to due process
when the MTCC rendered judgment against him without affording him
of the right to present his evidence. Agreeing with the petitioner, the
RTC vacated the MTCC decision and remanded the cases to it for the
reception of petitioner's evidence.
On 11 March 1999, during the pendency of the remanded cases,
petitioner filed with the MTCC a"Request for Issuance of Subpoena
Ad Testificandum and Subpoena Duces Tecum", requiring Vivian
Deocampo or Danilo Yap, both of Cal's Corporation or their duly
authorized representatives, to appear and testify in court on 19 May
1999 and to bring with them certain documents, records and books of
accounts for the years 1993-1999, to wit:
a) Sales Journal for the year 1993;
b) Accounts Receivable Journal for the year 1993;
c) Sales Ledger for the year 1993;
d) Accounts Receivable Ledger for the year 1993 (in its absence,
Accounts Receivable Ledger for the years 1994, 1995, 1996, 1997,
1998 or 1999);
e) Audited Income Statement for the years 1993, 1994, 1995, 1996,
1997, 1998 and Income Statements as of February 1999;
f) Audited Balance Sheet for the years 1993, 1994, 1995, 1996, 1997,
1998 and Balance Sheet as of February 1999; andcralawlibrary
g) Income Tax Returns for the years 1993, 1994, 1995, 1996 and
1997.
The prosecution did not object to this request.
When the cases were called on 19 May 1999, the MTCC, then
presided by Acting Judge Geomer C. Delfin, issued an order granting
petitioner's aforementioned request and accordingly directed the
issuance of the desired subpoenas.
During the trial of 14 July 1999, the private prosecutor manifested that
it was improper for the trial court to have directed the issuance of the
requested subpoenas, to which the petitioner countered by saying that
Judge Delfin's order of 19 May 1999 had become final and hence,
immutable. Nonetheless, the trial court issued an order allowing the
prosecution to file its comment or opposition to petitioner's request for
the issuance of subpoenas.
The prosecution did file its opposition, thereunder arguing that:
a) Vivian Deocampo, who previously testified for Lota Briones-Roco in
Criminal Cases Nos. 94-2177-12 to 94-2182-12 before Branch 1 of
the MTC, had earlier attested to the fact that the following documents,
records and books of accounts for 1993 sought by petitioner were
already burned:
1. Audited Income Statement for the years 1993, 1994, 1995, 1996,
1997, 1998 and Income Statement as of February 1999;
2. Audited Balance Sheet for the years 1993, 1994, 1995, 1996, 1997,
1998 and Balance Sheet as of February 1999; andcralawlibrary
3. Income Tax Returns for the years 1993, 1994, 1995, 1996 and
1997.
b) the Sales Ledger for the year 1993 cannot be produced because
Cal's Corporation did not maintain such ledger; andcralawlibrary
c) the account Receivable Ledger for the periods from 1993, the
Income Statement for 1993 and the Balance Sheet as of February
1999, cannot also be produced because Cal's Corporation recently
computerized its accounting records and was still in the process of
completing the same.
For its part, the corporation itself maintained that the production of the
above-mentioned documents was inappropriate because they are
immaterial and irrelevant to the crimes for which the petitioner was
being prosecuted.
In a resolution dated 19 October 1999, the MTCC, this time thru its
regular Presiding Judge, Judge Edward B. Contreras, denied
petitioner's request on the following grounds: (a) the requested
documents, book ledgers and other records were immaterial in
resolving the issues posed before the court; and (b) the issuance of
the subpoenas will only unduly delay the hearing of the criminal
cases.
His motion for reconsideration of the denial resolution having been
similarly denied by Judge Contreras, petitioner then went to the RTC
on a petition for certiorari with plea for the issuance of a writ of
preliminary injunction and/or temporary restraining order, imputing
16
grave abuse of discretion on the part of Judge Contreras, which

petition was docketed in the RTC as SP Case No. V-7489.
In a resolution dated 18 October 2000, the RTC denied due course to
and dismissed the petition for petitioner's failure to show that Judge
Contreras committed grave abuse of discretion amounting to excess
or lack of jurisdiction. A motion for reconsideration was thereafter filed
by petitioner, but it, too, was likewise denied.
Undaunted, petitioner went on appeal via certiorari to the Court of
Appeals in CA-G.R. SP No. 66038.
As stated at the outset hereof, the Court of Appeals, in a decision
dated 20 August 2002,4 dismissed the petition and accordingly
affirmed the impugned resolutions of the RTC. With his motion for
reconsideration having been denied by the same court in its resolution
of 12 May 2003,5 petitioner is now with us via the present recourse on
his submissions that I.
XXX THE DENIAL OF THE REQUEST FOR THE ISSUANCE OF
SUBPOENA AD TESTIFICANDUM AND SUBPOENA DUCES
TECUM IS VIOLATIVE OF THE CONSTITUTIONAL RIGHT OF THE
ACCUSED AS ENSHRINED IN ART. III, SEC. 14 (2) OF THE
CONSTITUTION; and
II.
XXX THERE MUST BE A BALANCING OF INTEREST BETWEEN
THE RIGH [sic] OF AN ACCUSED TO PROVE HIS INNOCENCE
AND THE RIGHT OF A COMPLAINANT TO THE SPEEDY
DISPOSITION OF HIS CASE.
As we see it, the pivotal issue is whether or not the three (3) courts
below committed reversible error in denying petitioner's request for
the issuance of subpoena ad testificandum and subpoena duces
tecum in connection with the five (5) criminal cases for violation of BP
22 filed against him and now pending trial before the MTCC.
We rule in the negative.
A subpoena is a process directed to a person requiring him to attend
and to testify at the hearing or trial of an action or at any investigation
conducted under the laws of the Philippines, or for the taking of his
deposition.6
In this jurisdiction, there are two (2) kinds of subpoena, to wit:
subpoena ad testificandum and subpoena duces tecum. The first is
used to compel a person to testify, while the second is used to compel
the production of books, records, things or documents therein
specified. As characterized in H.C. Liebenow v. The Philippine

Vegetable Oil Company:7
The subpoena duces tecum is, in all respects, like the ordinary
subpoena ad testificandum with the exception that it concludes with
an injunction that the witness shall bring with him and produce at the
examination the books, documents, or things described in the
subpoena.
Well-settled is the rule that before a subpoena duces tecum may
issue, the court must first be satisfied that the following requisites are
present: (1) the books, documents or other things requested must
appear prima facie relevant to the issue subject of the controversy
(test of relevancy); and (2) such books must be reasonably described
by the parties to be readily identified (test of definiteness). Again, to
quote from H.C. Liebenow:8
In determining whether the production of the documents described in
a subpoena duces tecum should be enforced by the court, it is proper
to consider, first, whether the subpoena calls for the production of
specific documents, or rather for specific proof, and secondly, whether
that proof is prima facie sufficiently relevant to justify enforcing its
production. A general inquisitorial examination of all the books,
papers, and documents of an adversary, conducted with a view to
ascertain whether something of value may not show up, will not be
enforced. (Emphasis supplied)rllbrr
Further, in Universal Rubber Products, Inc. v. CA, et al.,9 we held:
Well-settled is Our jurisprudence that, in order to entitle a party to the
issuance of a 'subpoena duces tecum,' it must appear, by clear and
unequivocal proof, that the book or document sought to be produced
contains evidence relevant and material to the issue before the court,
and that the precise book, paper or document containing such
evidence has been so designated or described that it may be
identified. (Emphasis supplied)rllbrr
Going by established precedents, it thus behooves the petitioner to
first prove, to the satisfaction of the court, the relevancy and
the definiteness of the books and documents he seeks to be brought
before it.
Admittedly, the books and documents that petitioner requested to be
subpoenaed are designated and described in his request with
definiteness and readily identifiable. The test of definiteness,
therefore, is satisfied in this case.
17
It is, however, in the matter of relevancy of those books and

documents to the pending criminal cases that petitioner miserably
failed to discharge his burden.
In the recent case of Aguirre v. People of the Philippines,10 the Court
reiterated the following discussions regarding violations of BP 22:
xxx what the law punishes is the issuance of a bouncing check not the
purpose for which it was issued nor the terms and conditions relating
to its issuance. The mere act of issuing a worthless check is malum
prohibitum. (Cruz v. Court of Appeals, 233 SCRA 301). All the
elements, therefore, of the violation of Batas Pambansa Blg. 22 are all
present in the instant criminal cases and for which the accused is
solely liable, to wit: [a] the making, drawing and issuance of any check
to apply to account or for value; [2] the knowledge of the maker,
drawer or issuer that at the time of issue he does not have sufficient
funds in or credit with the drawee bank for the payment of such check
in full upon its presentment; and [3] subsequent dishonor of the check
by the drawee bank for insufficiency of funds or credit or dishonor for
the same reason had not the drawer, without any valid cause, ordered
the bank to stop payment.(Navarro v. Court of Appeals, 234 SCRA
639).
We stress that the gravamen of the offense under BP 22 is the act of
making or issuing a worthless check or a check that is dishonored
upon its presentment for payment.11 The offense is already
consummated from the very moment a person issues a worthless
check, albeit payment of the value of the check, either by the drawer
or by the drawee bank, within five (5) banking days from notice of
dishonor given to the drawer is a complete defense because
the prima faciepresumption that the drawer had knowledge of the
insufficiency of his funds or credit at the time of the issuance of the
check and on its presentment for payment is thereby rebutted by such
payment.12
Here, petitioner would want it appear that the books and documents
subject of his request for subpoenaduces tecum are indispensable, or,
at least, relevant to prove his innocence. The Court disagrees.
Based on the records below and as correctly pointed out by the Court
of Appeals, petitioner had been issued by Cal's Corporation with
temporary receipts in the form of yellow pad slips of paper evidencing
his payments, which pad slips had been validated by the corporation
itself. Clear it is, then, that the production of the books and documents
requested by petitioner are not indispensable to prove his defense of
payment. In the words of the appellate court:
The Petitioner admitted, when he testified in the Regional Trial Court,

that he had been issued temporary receipts in the form of yellow pad
slips of paper, by the Private Respondent, for his payments which
were all validated by the Private Respondent (Exhibits '8' and 'F' and
their submarkings). Even if the temporary receipts issued by the
Private Respondent may not have been the official receipts for
Petitioner's payments, the same are as efficacious and binding on the
Private Respondent as official receipts issued by the latter.
We do not find any justifiable reason, and petitioner has not shown
any, why this Court must have to disbelieve the factual findings of the
appellate court. In short, the issuance of a subpoena duces tecum or
ad testificandum to compel the attendance of Vivian Deocampo or
Danilo Yap of Cal's Corporation or their duly authorized
representatives, to testify and bring with them the records and
documents desired by the petitioner, would serve no purpose but to
further delay the proceedings in the pending criminal cases.
Besides, the irrelevancy of such books and documents would appear
on their very face thereof, what the fact that the requested Audited
Income Statements, Audited Balance Sheets, Income Tax Returns,
etc. pertained to the years 1994 to 1999 which could not have
reflected petitioner's alleged payment because the subject transaction
happened in 1993. Again, we quote from the assailed decision of the
Court of Appeals:
The checks subject of the criminal indictments against the Petitioner
were drawn and dated in 1993. The Petitioner has not demonstrated
the justification, for the production of the books/records for 1994, and
onwards, up to 1999. Especially so, when the "Informations" against
the Petitioner, for violations of BP 22, were filed, with the Trial Court,
as early as 1994.
We are inclined to believe, along with that court, that petitioner was
just embarking on a "fishing expedition" to derail "the placid flow of
trial".
With the above, it becomes evident to this Court that petitioner's
request for the production of books and documents referred to in his
request are nakedly calculated to merely lengthen the proceedings in
the subject criminal cases, if not to fish for evidence. The Court deeply
deplores petitioner's tactics and will never allow the same.
WHEREFORE, the instant petition is DENIED and the challenged
decision and resolution of the Court of Appeals AFFIRMED.
Costs against petitioner.
18
Nature of Trial
G.R. No. L-17427
July 31, 1962
RODRIGO ACOSTA, petitioner,
vs.
PEOPLE OF THE PHILIPPINES, respondent.
Rodrigo Acosta for and in his own behalf as petitioner.
Office of the Solicitor General for respondent.
CONCEPCION, J.:
Appeal by certiorari, taken by Rodrigo Acosta, from a decision of the
Court of Appeals remanding this case to the court of origin for retrial
and the rendition of judgment in accordance with the evidence that the
parties may then present.
It appears that on January 2, 1951, an information for malversation of
public funds thru reckless negligence was filed, with the Court of First
Instance of Bukidnon, against petitioner Rodrigo Acosta, for having
allegedly made, as Provincial Treasurer of Bukidnon, "irregular and
excessive purchases of supplies, materials, equipment and printed
forms from private dealers for the use of the province", and against
Leonardo Avila, for having, as Provincial Auditor of the same province,
"passed in audit the corresponding vouchers covering the payments
for such purchases." Subsequently, the information was amended to
include as defendants three (3) private dealers, namely, C. Silvestre,
E. M. Haravata and Victoriano C. Arias, who had allegedly been able
to collect payment upon said purchases. Still later, however, the
prosecution filed a second amended information excluding said
dealers from the charge.
The trial under this second amended information, in connection with
which Acosta and Avila had entered a plea of not guilty, began on
June 19, 1952 and ended on July 28, of the same year. However, the
trial Judge, Hon. Jose P. Veluz, retired from the service without having
decided the case. His successor in office, Hon. Vicente Abad Santos,
Judge, "found the transcript of 482 pages prepared by stenographer
Celestino Suarez" replete with "omissions and also inaccuracies
which had been indicated by means of marginal notes on the pages
mentioned in" an "order of September 25, 1957." Judge Abad Santos
directed, therefore, said stenographer "to re-transcribe his notes and
to submit the "new transcript as well as the first transcript" not later
than forty days after receipt of a copy of said order". But, "instead of
re-transcribing his notes . . ., Mr. Suarez merely made corrections in
handwriting and inserted some supplemental transcripts in the original
transcripts". Upon reading those supplemental typed transcripts,

particularly the portion covering the cross-examination of witness
Pedro Palafox by defense counsel Cipriano Asada, Judge Abad
Santos noticed, however, that it was still "full of inaccuracies".
Accordingly, he ordered the stenographer to read his notes in his
(Judge Abad Santos) chamber, in order that the necessary corrections
could be made on the transcript. Upon going over said notes, it
appeared that said portion "consisted of eleven pages although the
transcript thereof was spread to eight pages only". Hence, Suarez
was ordered to further transcribe what had thus been omitted. What is
more, in order that he could decide the case with a "clear conscience",
Judge Abad Santos bade Suarez to stay in his (Judge Abad Santos')
office in order to read his (Suarez) notes from the beginning, with
stenographer Montes checking the transcript already made. Although
he did not immediately reveal his objection thereto, Suarez later
refused to work in said office stating that "it made him dizzy to come
up and" that "besides he was going to resign or retire" and then asked
to be allowed to do his work in the first floor of the court house.
Instead of granting his request, Judge Abad Santos recommended to
the Department of Justice, in order to avoid further delay in the
disposition of the case, (a) that any application for retirement or
resignation that may be submitted by Suarez be denied; and (b) that
payment of his salary be suspended until otherwise recommended,
after compliance with the order that he should work in the office of the
Judge, provided that the result of his work is satisfactory. Eventually,
the transcript of the stenographic notes, certified to be "true and
correct", consisted of 658 pages as compared to only 482 pages
found by Judge Abad Santos on September 9, 1957.
Meanwhile, Judge Abad Santos had resigned leaving the case
undecided. He was succeeded in office by Hon. Abudio Arrieta, Judge,
who, on October 27, 1958, rendered a decision convicting the
defendants as charged and sentencing each to an indeterminate
penalty ranging from eleven (11) years, six (6) months and twenty (20)
days ofprision mayor to sixteen (16) years, five (5) months and eleven
(11) days of reclusion temporal, to pay a fine of P28,808.86,
representing one-half of the total sum allegedly misappropriated, as
well as to jointly and severally indemnify the province of Bukidnon in
the sum of P62,955.06, without subsidiary imprisonment in case of
insolvency, to perpetual disqualification and to pay the costs.
Both defendants appealed from this decision to the Court of Appeals
and urged the same to acquit them upon the ground, among others,
19
that said decision was based on incomplete and tampered transcript,

upon which a conviction beyond reasonable doubt could not be
predicated. Acosta, moreover, claimed that his constitutional right to a
speedy trial had been violated. On July 2, 1960, the Court of Appeals
rendered its decision, from which we quote:
. . . on the basis of available transcript, (which originally contains 482
pages and when retranscribed and corrected it consists of 658
pages), indicating that irregularities in taking the notes and in
transcription thereof were committed, we can not see our way clear to
pronounce either were conviction or acquittal in this case. Indeed, the
evidence in this case is not quite accurate or reliable for the reasons
already underscored earlier. Since the crime with which the accused
were charged carries a stiff penalty and that it is one that should be
fully prosecuted for being highly undesirable, if not immoral, we prefer
to subordinate acquittal or conviction to time. Stated otherwise, we are
of the opinion that the ends of justice, both to the government and to
the accused, would be better served if further proceedings will take
place in order that this case could be decided satisfactorily once and
for all.
From the "corrected" transcript, we gathered that counsel for accused
Leonardo Avila in the court below incurred certain inconsistencies, to
wit:
(1) Your Honor please, without renouncing or waiving our rights to
present evidence for the defense of the accused Leonardo Avila, . . .
we move for the dismissal of this case on two grounds:
xxx
xxx
xxx
(2) As regards the accused Avila, Your Honor, we waive our right to
present evidence on his defense and we submit the case for decision
with the evidence presented by the Fiscal, and we beg to allow us to
withdraw insofar as the accused Avila is concerned we beg to
leave the courtroom.
(3) We do not ask for a separate trial, Your Honor, in order to obviate
duplicity of questions, but now we will ask for a separate defense.
(4) And that is within the lookout of the defense, Your Honor, and we
reiterate our motion to leave this Honorable Court to allow us to leave
the courtroom, and consider our case closed. (t.s.n., pp. 545, 554, &
558.)
On appeal, counsel for appellant Leonardo Avila filed a motion for new
trial, because of the aforequoted statements and of the erroneous and
incomplete transcript of the trial stenographer. The motion was,
however, denied (Rec. 3rd Div., Feb. 12, 1959). Appellate Courts have
that broad power to order new trial without specifying the grounds
thereof in order to avoid a miscarriage of justice. The grounds upon
which courts of first instance may grant a new trial are limited (Pls.
see Sec. 5, Rule 117, Rules of Court), but appellate courts, under
Section 14, Rule 120 are authorized to remand a case to a court of
first instance for new trial or retrial, without specifying, and, hence,
without limiting, the grounds upon which the action may be
predicated. And pursuant to Section 11, Rule 120, of the Rules of
Court, an appellate court may . . . remand a case to a court of first
instance for new trial or retrial . . . .
WHEREFORE, the record of this case is ordered remanded to the
court of origin for retrial and another judgment be rendered in
accordance with the evidence that the parties concerned may desire
to present.
Acosta sought a reconsideration of this decision, which was denied.
Hence, his present appeal by certiorari.
Petitioner maintains that the Court of Appeals erred in ordering a
retrial, instead of acquitting him, not only because he had been
deprived of the constitutional right to a speedy trial, but, also, because
a retrial would be impractical, oppressive and expensive, apart from
amounting to a denial of justice, for a principal witness for the
defense, one Justiniano B. Castillo, had allegedly died on December
24, 1957, and his other witnesses may no longer be available.
It should be noted that the original information in this case was filed
on January 2, 1951 and that the trial of the reception of the evidence
for both parties commenced on June 19, 1952 and was finished on
July 18 of the same year. Petitioner does not contend that there has
been any undue delay in this part of the proceedings. His alleged
deprivation of the right to a speedy trial is anchored on the fact that
the decision of the lower court was rendered over six (6) years later.
In this connection, the Court of Appeals aptly observed:
. . . True enough that judgment was pronounced after almost six
years. But "the constitutional right to a public and speedy trial does
not extend to the act of pronouncement of sentenced" (Reed vs.
State, 147 Ind., N. E., 135, 136). It has been said that "trial and
judgment are two different stages of a judicial proceeding: the former
is provided for in Rule 115, and the latter is covered by Rule 116, of
the Rule of Court. (Talabon v. Iloilo Prov. Warden, 78 Phil., 600). And
"the period of the trial terminates when the judgment begins"
(Felismino vs. Gloria, 47 Phil., 967). Therefore, and since the accused
did not avail themselves of the writ of mandamus to compel the trial
20
judge or his successor to pronounce the corresponding judgement, it

may be said in the light of the ruling laid down in the case of Talabon
vs. Iloilo Prov. Warden, infra, that they had waived their right to a
speedy trial.
Indeed:
No general principle fixes the exact time within which a trial must be
had to satisfy the requirement of a speedy trial. The right to a speedy
trial is necessarily relative; it is consistent with delays, and whether
such a trial is afforded must be determined in the light of the
circumstances of each particular case as a matter of judicial
discretion. It is generally said that a speedy trial is one had as soon
after indictment as the prosecution can with reasonable diligence
prepare for it, regard being had to the terms of court, a trial conducted
according to fixed rules, regulations and proceedings of law, free from
vexations, capricious, and oppressive delays. One accused of crime is
not entitled to a trial immediately on his arrest or accusation, he must
wait a regular term of the court until an indictment is found and
presented if the case is one wherein the trial is on indictment, and
until the prosecution has had reasonable time to prepare for the trial.
(22 C.J.S., 715-716.)
Under constitutional provision securing to accused "the right to a
public trial", or a "speedy trial", is has been held that the formal
declaration of sentence is no part of the trial. (24 C.J.S., 16.)
Moreover, the delay in the rendition of the decision of the court of first
instance was due to circumstances beyond the control of the judges
who presided the same. Judge Veluz, who received the evidence, was
automatically retired owing to his age. Judge Abad Santos, who
succeeded him, could not decide the case because he found the
transcript to be inaccurate and he had to make disciplinary measures
in order to compel stenographer Suarez to retranscribe his notes. By
the time this was done, Judge Abad Santos was no longer in the
service. Hence, his successor Judge Arrieta was the one who
rendered the decision of the lower court.
Upon the other hand, we cannot, in the exercise of our jurisdiction on
appeal by certiorari, absolve the petitioner of the crime charged
against him, for there are no findings of fact in the decision of the
Court of Appeals upon which this Court could base a judgement of
acquittal. Moreover, the opinion of the Court of Appeals to the effect
that the transcript of the stenographic notes taken during the trial of
this case in the court of first instance does not reflect faithfully what
transpired during said trial is, apart from being shared by petitioner
herein, conclusive upon us. Under these circumstances, we should

not interfere in the exercise of discretion by the Court of Appeals. In
the language of Corpus Juris:
Under a statute which provides that a person restrained of his liberty
is entitled to certiorari to inquire into the cause of his
imprisonment, certiorari does not lie to review a determination in a
criminal case where relator was discharged from custody under a bail
bond. The reason for such a rule is that the relator, therefore, was not
restrained of his liberty. The imprisonment or restraint in his liberty
within the meaning of this section, is an actual physical restraint by
which the liberty of the individuals is in some way interferred with. A
person cannot be said to be restrained in his liberty when he can do
what and go where he pleases. The mere fact his bail has authority to
surrender him to custody at any time is not a restrained in his
liberty. . . . If the relation should be surrendered by his bail, and thus
be actually in custody, he would be entitled to have the cause of his
detention reviewed; but until there is an actual restraint of his liberty,
he is not entitled to either of these writs (certiorari or habeas
corpus) . . . . (17 Corpus Juris, pp. 18-19.)
We are not unaware of the possible disadvantages to which petitioner
might be placed in the event of a retrial, but we are not in a position
now to determine the facts of such disadvantages. In fact, the very
petitioner has not particularized the evidence which not be available to
him at a retrial, aside from the circumstances that the prosecution
may then be similarly handicapped. In any event, when the retrial
takes place, petitioner may point out what evidence he can no longer
present and why, and the Court should then considered the effect
thereof upon the question of guilt or innocence of petitioner herein.
WHEREFORE, the decision of the Court of Appeals is hereby
affirmed, and the case remanded to the Court of First Instance of
Bukidnon for further proceedings in compliance therewith. It is so
ordered.
Bengzon, C.J., Padilla, Paredes, Dizon, Regala and Makalintal, JJ.,
concur.
Bautista Angelo, J., took no part.
Reyes, J.B.L., J., is on leave.
Trial and hearing, distinguished.
G.R. No. L-35701 September 19, 1973
21
ARTURO H. TROCIO, petitioner-appellant, vs. JORGE LABAYO,

Undersecretary of Finance; SIXTO B. TADEO, Assistant Provincial
Treasurer of Misamis Oriental; and ABELARDO SUBIDO,
Commissioner of Civil Service, Respondents-Appellees.
Adaza, Along and Adaza for petitioner-appellant.
Office of the Solicitor General Antonio P. Barredo, Assistant Solicitor
General Pacifico P. de Castro and Solicitor Pedro A. Ramirez for
respondents-appellees.
FERNANDO, J.:
The novel question in this case certified to us by the Court of Appeals
is whether or not a party is denied his constitutional right to procedural
due process if in the notice of the hearing the suit filed by him, it was
not specified that the purpose thereof was for a pre-trial. There is no
instrinsic difficulty posed by such a query. The answer would appear
to be rather obvious. Such a purely formal objection is hardly
impressed with any element indicative of that absence of fairness
which is indispensable for an attack on a due process ground to
succeed. The failure of the lower court then to use language more
explicit in character does not lend itself to such a reproach. The order
of dismissal for failure of petitioner Arturo H. Trocio, now appellant, to
prosecute, is affirmed.chanroblesvirtualawlibrarychanrobles virtual law
library
There is no dispute as to what transpired. On August 11, 1964,
petitioner filed in the Court of First Instance of Misamis Oriental a
petition for certiorari and prohibition with preliminary injunction against
respondents' 1 to set aside decision of respondent Abelardo Subido
dismissing him from the position of Municipal Treasurer of Mambajao,
Camiguin, which is being enforced by the other respondents on the
ground of its nullity. It was his contention that the charges against him
for neglect of duty, grave misconduct and oppression in office were
not duly proved, there being a denial of a motion for postponement on
his part, thus infecting the proceedings with grave infirmity. There was,
on August 15, 1964, a written opposition to the issuance of a writ of
preliminary injunction, and on August 27, 1964, an answer to such
petition wherein it was stressed that petitioner had been granted by
the investigating officer six postponements of the hearing of the case
to afford him a chance to engage the services of counsel. Then came
on September 10, 1964, a notice to the parties that the case had been
set for hearing on October 14 of that year, a copy thereof being
served on petitioner's counsel. Upon that case being called on that
date, there was a motion on the part of petitioner's counsel to set the
case for pre-trial. The provincial fiscal who represented the

respondents informed the Court that he was ready for the pre-trial but,
if no amicable agreement was reached, the trial proper should be
conducted, as his witnesses had come all the way from Manila and
expenses in the amount of about P400.00 had been incurred by the
government. Counsel for petitioner was adamant, however, insisting
that the notice of hearing as such was null and void. When the Court
inquired as to where the petitioner was, counsel answered that he
was in Cebu City, upon his own advice, on the assumption that a
hearing on the merits could not be held. From the standpoint of the
court, this step taken by petitioner smacked of a dilatory tactic, as
evidenced by its being raised only on that morning, notwithstanding
the fact that notice was sent as far back as September 10, 1964 and
that at any rate, petitioner not being present, a pre-trial could not
anyway be held. Moreover, the notification as worded did not preclude
a pre-trial, which incidentally was not at all necessary as the question
posed was legal. Hence the order of dismissal, based on what for the
lower court, under the circumstances, was a lack of interest to
prosecute the case.chanroblesvirtualawlibrarychanrobles virtual law
library
The matter was elevated to the Court of Appeals on the ground that
there was a denial of procedural due process as the notice of the
hearing without the specification that it should be for pre-trial deprived
the accused of a procedural right and infected the proceedings with
unfairness. As the question raised was purely legal, the case, as
noted at the outset, was elevated to
us.chanroblesvirtualawlibrarychanrobles virtual law library
There is no legal justification then, as already made clear, for us to
give our seal of approval to the contention vigorously pressed by
petitioner that there was a denial of procedural due process. In
reaching such a conclusion, we were aided considerably by the
thorough brief submitted by the then Solicitor General, now Associate
Justice, Antonio P. Barredo and the then Assistant Solicitor General,
now judge, Pacifico de Castro, the persuasive quality of which was
enhanced not only by the plausibility of the assertions made with
support from authoritative doctrines, but also by the failure of
petitioner to file a reply brief.chanroblesvirtualawlibrarychanrobles
virtual law library
1. No merit attaches to the contention of petitioner that the notice as
to the hearing scheduled for October 14 should specify that it was for
a pre-trial. A hearing as known to the law is not confined to a trial but
22
embraces the several stages of litigation. It does not preclude pretrial. Outside of the American cases cited 2 by respondents, mention
can be made of authorities in this jurisdiction that speak to the same
effect. A hearing "does not necessarily mean presentation of
evidence." 3 It could cover the determination of whether an accused is
entitled to bail 4 or the submission for the court's determination of a
motion to dismiss, 5 or any motion for that matter. 6 It does not admit
of doubt then, considering furthermore what did transpire, that such a
purely technical objection on the part of petitioner raised at the last
moment should not be taken too seriously. Much less does it lay any
basis for an asserted denial of procedural due
process.chanroblesvirtualawlibrarychanrobles virtual law library
2. There is an additional reinforcement to the correctness of the
challenged order of dismissal, when the nature of a pre-trial is taken
into consideration. 7 As set forth in an opinion penned by Justice
Castro, speaking for the Court, in Permanent Concrete Products, Inc.
v. Teodoro: 8 " "One of the objectives of pre-trial procedure is to take
trial of cases out of the realm of surprise and maneuvering." Pre-trial
is primarily intended to make certain that all issues necessary to the
disposition of a cause are properly raised. Thus, to obviate the
element of surprise, parties are expected to disclose at a pre-trial
conference all issues of law and fact which they intend to raise at the
trial, except such as may involve privilege or impeaching
matter." 9 The lower court therefore acted in accordance with law and
sound reason when it noted that the facts being undisputed and the
legal issue likewise being clear, pre-trial, under the circumstances,
would not be a necessity even on the assumption that the belated
insistence of its observance by petitioner was motivated in entire good
faith.chanroblesvirtualawlibrarychanrobles virtual law library
The suspicion entertained by the lower court as to its being resorted
to as a dilatory tactic by petitioner was not without basis. He had more
than a month, from September 9 to October 14, 1966, to seek
clarification of the nature of the scheduled hearing. What was even
more revealing as to his lack of good faith was his absence on the day
of hearing. What was the lower court to make of such tell-tale
conduct? Did it not indicate lack of interest to prosecute? There was
nothing then, that did smack of arbitrariness in its ruling as it did.
There was no affront to the sense of justice and of fair play which is
essential for an assault on any actuation of governmental agency
predicated on a denial of due process succeed. Instead of this futile
insistence on a pre-trial, which would serve no useful purpose,
petitioner could have impressed on the court the legal support for his
stand that the order of dismissal by respondent Commissioner of Civil
Service was devoid of legality. He did nothing of the kind. Under the
undeniable facts of record, the lower court certainly could have
decreed the dismissal without any legitimate fear that its order suffers
from the constitutional infirmity of failure to accord respect to the due
process safeguard. 10chanrobles virtual law library
WHEREFORE, the order of the lower court of October 14, 1964
dismissing the petition is affirmed. With costs against petitioner.
Makalintal, Actg. C.J., Zaldivar, Castro, Teehankee, Antonio and
Esguerra, JJ., concur.chanroblesvirtualawlibrarychanrobles virtual law
library
Barredo, J., took no part.chanroblesvirtualawlibrarychanrobles virtual
law library
Makasiar, J., is on leave.
When case ready for trial
January 22, 1952
G.R. No. L-3788
MARCIANO PRINCIPE, plaintiff-appellee,
vs.
ANTONIO ERIA, defendant-appellant.
LEONCIO MANINGAS, third party defendant.
Pedro Ynsua and Cenon Arcaza for appellee.
Francisco O. Omaa for appellant.
Montemayor, J.:
This is an appeal from an order of the Court of First Instance of
Quezon denying appellant's petition for relief from an order declaring
him in default and denying his petition for new trial.
The facts involved in the appeal are not disputed. Plaintiff-appellee
Marciano Principe filed an action against Antonio Eria to collect a sum
of money plus interest based on a promissory note or document
signed by Eria and his son-in-law, Leoncio Maningas, supposed to
embody a joint and several obligation and in which the signers
undertook to pay a certain amount with interest and where the two
stated that anyone of them may be made to pay the whole amount.
On April 12, 1948, after service of summons, defendant Eria
petitioned the court to have his co-signer of the promissory note,
Leoncio Maningas, included as a party defendant. Upon objection of
the plaintiff, the trial court on April 15, 1948, denied said petition for
23
inclusion of Maningas as party defendant on the ground that

according to the promissory note on which the complaint is based,
defendant Eria may be sued alone, and that full relief to the plaintiff
could be obtained without inclusion of Maningas as party-defendant.
On May 27, l948, defendant Eria filed an amended answer which was
admitted by order of the court dated June 24, 1948.
On November 19, 1949, the Clerk of the Court issued a notice setting
the case for hearing on December 13, 1949. On December 3, 1949,
defendant Eria filed a petition for leave to file a third party complaint
against his co-signer of the promissory note, Leoncio Maningas, at the
same time filing said third party complaint against Maningas. On
December 7, 1949, and because plaintiff Principe did not object to the
petition, the trial court granted it and admitted the third party
complaint, at the same time giving third party defendant Maningas the
reglementary period within which to answer the same.
In spite of the admission of the third party complaint and the giving of
notice to third party defendant Maningas to answer within the time
prescribed by law, and before third party defendant could answer the
third party complaint, on December 13, 1949, the date on which the
case was originally set for trial, and in the absence of defendant Eria
and his counsel, the case was tried and the plaintiff was allowed to
present his evidence.
On December 16, 1949, defendant Eria's counsel filed a pleading
entitled "Manifestation" wherein he stated that on that date he learned
that he (Eria) had been declared in default, and that would petition the
court for relief from said order, and on December 29, 1949, he filed his
petition for relief and new trial accompanying the same with his
affidavits of merits. The basis of his petition for relief is that he
believed that with the admission of the third party complaint and the
giving to third party defendant Maningas the reglementary period
within which to answer, the said party complaint automatically
cancelled the original date of hearing on December 13, 1949, and so
neither he nor his client Eria appeared in Court on that date. Upon
objection of the plaintiff, this petition for relief and new trial was denied
by order of January 23, 1950. A petition for reconsideration of the
order of denial was likewise denied by order of February 20, l950. In
his appeal, appellant Eria claims that the trial court erred in
proceeding with the trial of the case on December 13, 1949, without
his presence and that of his counsel, and not granting the petition for
relief.
Appellee counters with the contention that contrary to the rules of

court, appellant in his petition for relief and affidavit accompanying the
same, did not specifically state the defense which he would put up
should he be granted a new trial. We believe, however, that the more
important question involved in the present appeal is the legality and
propriety of the act of the trial court in proceeding with the trial of the
case before third party defendant Maningas had filed his answer. As a
matter of fact, Maningas filed his answer to the third party complaint
only on January 9, 1950, almost a month after the case was tried.
That defendant Eria had a right to file his third party complaint against
Leoncio Maningas who signed the promissory note with him, cannot
be denied. Rule 12, Section 1 of the rules of court gives him that right.
Said section 1 reads as follows:
SECTION 1. Claim against one not a party to an action. When a
defendant claims to be entitled against a person not a party to the
action, hereinafter called the third-party defendant, to contribution,
indemnity, subrogation or any other relief, in respect of the plaintiff's
claim, he may file, with leave of court, against such person pleading
which shall state the nature of his claim and shall be called the thirdparty complaint.
As already stated, his third party complaint was admitted by the trial
court without objection on the part of the plaintiff. Now, was trial court
authorized to try the case before the third party defendant had filed his
answer? Evidently not. The reason is that the case was not yet ready
for trial. Rule 31, Section 1, of the Rules of Court, provides:
SECTION 1. When issue joined. Upon the filling of the last
pleading, the case shall be included in the trial calendar of the court.
Under said section, Chief Justice Moran makes the following
comment:
The case may be said to be ready for trial and, therefore, should be
included in the trial calendar when the issue is joined. And the issue is
joined when all the parties have pleaded their respective theories and
the terms of the dispute are plain before the court. (Moran's
Comments on the Rules of Court, Vol. I third edition, p. 573.)
As we have already stated, on December 13, 1949, the case was not
ready for trial for the simple reason that the third party defendant
Maningas had not yet filed his answer. True, a trial court may under
Rule 32, Section 2 of the Rules of Court, in furtherance of
convenience or to avoid prejudice, order a seperate trial of any claim,
cross-claim, counterclaim, or third-party claim, or of any seperate
issue or issues. But on December 13, 1949, when the case was tried,
24
the issues had not yet been joined; all possible claims, cross-claims or
counterclaims had not yet been filed. Consequently, the trial court
could not have validly ordered a seperate trial because it did not know
nor was it in a position to know if the third party defendant Maningas
had any claim, cross-claim or counterclaim against either the plaintiff
Principe or the defendant Eria, or both. In other words, the trial was
altogether premature. It is reasonable to suspect that the trial court
had forgotten or completely overlooked the third party complaint
against Maningas and the fact that his answer to it was still pending
submission.
In view of all the foregoing, we find and hold that the trial held on
December l3, l949, when the case was not yet ready for trial was
premature and unauthorized; that appellant Eria had a right to believe
that the admission of his third party complaint and the granting of the
reglementary period to third party defendant Maningas to answer,
automatically cancelled the hearing originally set on December 13,
1949, and that consequently, he (Eria) should not be penalized for not
attending said hearing. The orders denying his petition for relief, and
his petition for reconsideration are hereby set aside, and the case is
hereby ordered returned to the trial court for a re-hearing after all the
parties have been duly notified thereof. No pronouncements as to
costs. So ordered.
Adjournments and postponements (Sec. 2, Rule 30) . Limitation on
the authority to adjourn
[G.R. No. 123997. January 20, 1999.]
REPUBLIC OF THE PHILIPPINES, Petitioner, v. SANDIGANBAYAN
and BRIG. GEN. PEDRO R. BALBANERO, Respondents.
DECISION
BELLOSILLO, J.:
This case emphasizes with great force the awesome responsibility of
counsel to represent a clients cause with due diligence and zeal
which necessarily excludes improvident and unreasonable requests
for postponement of hearings that only serve to impede the speedy
and inexpensive administration of justice.chanrobles law library
The Republic of the Philippines, in this special civil action

for certiorari, mandamus and prohibition, assails the Order of the
Sandiganbayan, First Division, dated 19 October 1995, in "Republic of
the Philippines v. Brig. Gen. Pedro Balbanero," Civil Case No. 0053,
denying petitioners oral motion for postponement of the 19 and 20
October 1995 hearings and requiring it instead to submit a written
offer of evidence, as well as the Resolution of 3 January 1996 denying
reconsideration thereof. Petitioner therefore prays that it be allowed to
present documentary and testimonial evidence in a formal trial and
that public respondent be prevented from conducting further
proceedings pursuant to its questioned Orders.
Civil Case No. 0053 is an action for forfeiture under RA No. 1379 1
instituted on 14 October 1988 by the Republic of the Philippines
against retired Brig. Gen. Pedro R. Balbanero alleging that the latter
acquired funds, real properties and other assets amounting to P10.5
million manifestly out of proportion to his total salary and emoluments
as an Army Officer and as income from business and other
legitimately acquired properties.
On 22 March 1989 private respondent filed his answer with
counterclaim to which the Republic filed a reply with motion to dismiss
counterclaim. After the submission by private respondent of
documentary evidence and in view of the manifestation of Solicitor
Felipe Magat, Colonel Ernesto Punzalan and Captain Samuel Padilla
of the AFP Anti-Graft Board representing the Government that P8.4
million of the alleged over P10 million unexplained wealth had been
clarified, the Sandiganbayan in its Order dated 19 February 1990
required private respondent to prove the legal source of the remaining
"P1.3 million." The parties were required to meet to resolve the matter
before trial. On the basis of a "Complete Report" dated 2 August 1990
submitted by Capt. Padilla, the amount of respondents wealth
deemed to be still unexplained dwindled to P165,043.00. Thus the
OSG in behalf of petitioner asked that a decision be rendered
forfeiting the amount in its favor.
To prove the legal source of the remaining P165,043.00, private
respondent submitted a document titled "Real Estate Mortgage Loan"
purporting to show that the amount was the purchase price he
received for real estate sold to Ms. Iluminada S. Salvador Et. Al. when
25
he failed to pay his mortgage indebtedness. In his Manifestation and

Motion dated 7 December 1990 private respondent moved that the
complaint against him be dismissed on the ground that he had
explained to the governments satisfaction the legal source of all his
alleged unexplained wealth.chanroblesvirtuallawlibrary
In its answer to the foregoing Manifestation and Motion the
Presidential Commission on Good Government (PCGG) denied that
private respondent had satisfactorily explained the legitimate source
of his wealth and added that the "Complete Report" submitted by the
AFP Anti-Graft Board was without its approval, hence, did not bind the
Republic.
On 28 June 1991, without resolving private respondents
Manifestation and Motion of 7 December 1990, public respondent
Sandiganbayan allowed the Republic to present oral and
documentary evidence to support its complaint for forfeiture.
On 7 June 1994 private respondent moved that petitioner be bound by
the Solicitor Generals previous admission that only P165,043.00 had
not been satisfactorily explained, hence, the remaining issue to be
resolved by the Sandiganbayan should be limited to the amount. But
Sandiganbayan denied the motion. Hence, on 3 May 1995 private
respondent elevated the matter to this Court by way of a petition
forcertiorari, prohibition and mandamus in "Pedro R. Balbanero v. the
Hon. Sandiganbayan and the Republic of the Philippines," docketed
as G.R. No. 119633.
In view of the pendency of his petition, private respondent moved that
the hearings on 18, 19 and 20 October 1995 be canceled and that no
further schedule be set. Public respondent denied the cancellation
unless a restraining order was issued by this Court in G.R. No.
119633, citing petitioners readiness to present on the scheduled
hearings Major Samuel Padilla (earlier referred to as Captain Padilla)
who purportedly conducted the audit examination of the accounts of
private Respondent.
Upon urgent motion dated 5 October 1995 the Sandiganbayan
granted private respondents request for cancellation of the 18
October 1995 hearing on the allegation that his counsel was
scheduled to attend an election case before the RTC of Gapan,
Nueva Ecija, but stressing that the cancellation was without prejudice
to the settings on 19 and 20 October 1995.
2chanroblesvirtuallawlibrary
On 19 October 1995 Associate Solicitor Rodolfo Tagapan, Jr., and
Assistant Solicitor General Cesario del Rosario manifested during the
hearing that they had been relieved from the case and that ASG
Romeo C. de la Cruz and Solicitor Karl B. Miranda had been
designated in their stead. However, since the latter two were in the
United Arab Emirates attending to the case of convicted Filipina
overseas contract worker Sarah Balabagan, Associate Solicitor
Tagapan asked that the hearing be reset, to which the Sandiganbayan
reacted adversely with its now assailed Order of 19 October 1995
which we quote hereunder for a better appreciation of the factual
milieu
When this case was called for hearing respondent appeared while the
petitioner Republic appeared through Associate Solicitor Rodolfo
Tagapan together with Atty. Cresencio Jaso of the PCGG. Associate
Solicitor Tagapan informed the Court that he had been relieved from
this case and in his stead Solicitor Karl B. Miranda had been
designated but that Solicitor Miranda was in Abu Dhabi on official
mission, while Atty. Jaso informed this Court that this was his first
appearance and was, therefore, not ready to be of assistance.
Additionally, no witness had appeared allegedly upon advice of
Associate Solicitor Tagapan precisely because of this (sic) reassignments relying on the postponement to be granted by this Court.
Solicitor Rodolfo Reodica had been appearing until suddenly at the
hearing on May 10, 1995 Associate Solicitor Tagapan appeared and
had expressed his unreadiness to proceed at that time. The petition
for postponement was granted over the objection of the respondent,
notwithstanding the pendency of a petition for certiorari, prohibition
and mandamus already filed by the respondent to dispute a prior
denial of his motion to dismiss by reason of the petitioners earlier
repeated failure to proceed said petition now docketed as G.R. No.
119633. On September 22, 1995, Associate Solicitor Tagapan
informed the Court that he would be ready to present Major Samuel
Padilla on October 18, 19 and 20, 1995. Today, the Court is faced with
the situation as above stated.
26
This case had been pending not only for a very long time but despite
many false starts from the petitioner. While indeed the Court has
reacted negatively to the difficult situations created by the assignment
of young Solicitors such as Solicitor Reodica now Solicitor Tagapan on
short notice, the Court can not accept a rotation of young and
inexperienced Solicitors who are uninformed of the details of this case
by reason of their assignment on short notice as reasons for
postponing this case on top of their informal complaints of lack of
cooperation from or coordination with the PCGG much less can the
Court accept the last minute substitutions of Solicitors with others who
are not in this country.
In view hereof, the petitioner is given ten (10) days from today within
which to formally offer whatever evidence exist (sic) on record with the
respondent being given a like period to comment thereon and to state
his disposition on this matter with respect to the presentation of his
own evidence.
The setting for tomorrow is necessarily cancelled under the
circumstances.
Petitioner moved that this Order be reconsidered and that it be
allowed to present evidence in a formal trial. The motion was denied
by public respondent in its assailed Resolution of 3 January 1996 thus
The MOTION FOR RECONSIDERATION dated 7 December 1995 of

the Plaintiff is Denied.chanroblesvirtuallawlibrary
It is true that this Court expressed its impatience and disapproval over
the practice of the Office of the Solicitor General of passing on,
actually dumping of certain cases such as these to a succession of
young inexperienced lawyers on short notice. This, however, is not
cured by transferring a long standing case to probably experienced
lawyers who are not available and on short notice.
The point of this Courts impatience on the transferring of cases to
inexperienced lawyers on short notice is that cases are unduly
delayed and, perhaps, prejudiced by the inexperienced; in fact, more
than anything, the practice has demonstrated an apparent low regard
of Solicitors and Assistant Solicitors General for many PCGG cases.
Assigning this case, which has suffered long and innumerable

postponements attributable to plaintiff, to lawyers of the Office of the
Solicitor General who are not even in the country at the time of the
setting neither responds to the problem nor demonstrates appropriate
concern for the case.
The petitioner is given fifteen (15) days to submit its written offer of
evidence after which the case of the plaintiff will be deemed
submitted, with or without the offer.
Hence, this special civil action for certiorari, prohibition and
mandamus.
The OSG contends that the Sandiganbayan gravely abused its
discretion when it deprived the Republic of its right to present
evidence in a full-blown hearing amounting to a violation of its right to
due process. Counsel contends that the reasons given for the
requested resettings of the 19 and 20 October 1995 hearings were
meritorious grounds which were not intended to delay the case nor
violate private respondents right to a speedy trial. The OSG further
contends that public respondent should not have taken against the
Republic the fact that Major Samuel Padilla was indisposed on the
day of the hearing as it was a circumstance beyond its control while
the re-assignment of the case to Solicitor Miranda and Atty. Jaso was
effected only in response to public respondents plaintive about the
assignment of the case to young and untrained solicitors.chanrobles
virtualawlibrary chanrobles.com:chanrobles.com.ph
On 17 April 1996 we required respondents to file their respective
comments on the petition without granting the TRO sought by
petitioner. Private respondents Comment and petitioners Reply
thereto were noted on 8 July 1996 and 4 February 1998, respectively.
On 6 July 1998 we considered this case submitted for decision
without public respondents comment when it failed to file the required
pleading for more than two (2) years from the time it was first required
to do so and despite our Resolution of 4 February 1998 reiterating our
Resolution of 17 April 1996.
Plainly stated, the issue before us is whether public respondent
Sandiganbayan committed grave abuse of discretion in denying the
27
Republics oral motion for postponement of the 19 and 20 October

1995 hearings and in requiring it to just formally offer its evidence
within fifteen (15) days from notice.
It is well-settled that motions for continuance or deferment of hearings
are granted only upon meritorious grounds 3 and that the grant or
denial thereof is addressed to the sound discretion of the court 4 the
exercise of which will not be disturbed except on a showing of a
patent and grave abuse of discretion.
presence of the adverse party, or those made in the course of a

hearing or trial." A motion for postponement should not be filed at the
last hour 9 and that judges are cautioned against granting improvident
postponements. 10 Thus when the reason adduced in support of a
motion for postponement was not unavoidable or could have been
foreseen but was presented only on the day of the trial although there
was no apparent reason why it could not have been presented earlier,
thus avoiding inconvenience to the adverse party, it is proper for the
court to deny postponement. 11
Petitioner failed to show such patent and grave abuse of discretion on

the part of public respondent in denying its oral motion for
postponement. Records show that the 18, 19 and 20 October
hearings were scheduled some five (5) months earlier, or on 10 May
1995, for several reasons among which was to give Associate
Solicitor Tagapan of the OSG, who appeared for the first time vice
Solicitor Reodica, an opportunity to study the case. 5 In addition, on
13 October 1995 when public respondent Sandiganbayan canceled
the 18 October hearing, it cautioned the parties that such cancellation
was without prejudice to the settings on 19 and 20 October 1995. 6
What exacerbates the case for the OSG is the fact that it appeared in
the 19 October 1995 hearing without its promised witness, apparently
expecting that public respondent would just benevolently grant its
precipitate oral motion for postponement. While the OSG now claims
that Major Padilla was "indisposed" for which reason he was not
presented, public respondents factual conclusion to which this Court
is bound in a certiorari proceeding is that no witness appeared
allegedly upon advice of Associate Solicitor Tagapan relying on the
postponement to be granted by public respondent precisely because
of the reassignment of solicitors. 12
However, on 19 October 1995, Solicitor Tagapan appeared only to

manifest that he had just been relieved from the case and that other
solicitors were assigned to take over but unfortunately they were not
then available. The OSG explains that the re-assignment was effected
in response to public respondents complaint about the assignment of
many PCGG cases to young and inexperienced solicitors. But a
careful reading of the questioned Order of 19 October 1995 shows
that public respondent objected not so much on the assignment of the
case to young and inexperienced solicitors but that such reassignment was done on short notice and very close to the date of
scheduled hearings. The excuse given by the OSG completely failed
to justify why the re-assignment had to be done so near to the
scheduled hearing of 19 October 1995 and, worse, to solicitors who
were not even present.chanroblesvirtual|awlibrary
The rule that a party asking for postponement has absolutely no right
to assume that its motion would be granted, especially on less than
three (3) days notice, and must be in court prepared on the day of the
hearing 13 applies with greater force in this case where the OSG had
in fact more reason not to presume a grant of its motion for
postponement considering that Major (formerly Captain) Samuel
Padilla had already been previously warned by public respondent thus
Furthermore, it has not been shown that some other urgent

circumstance prompted the re-assignment to justify the OSGs noncompliance with the requisites of motions in general set out in Rule 15
7 of the Rules of Court 8 Sec. 2 of which provides that" [a]ll motions
shall be in writing except motions for continuance made in the
Capt. Samuel Padilla is given five (5) days from receipt hereof to
show why he should not be held disciplinarily accountable for his
failure to appear . . . when he knew as a matter of fact that this case
wherein he appears to be the principal government witness has been
pending since 1988 and that his testimony was suspended as far back
as February 15, 1990, precisely by reason of the unorganized state of
evidence of the petitioner at the time so that all of the proceedings
thereafter had been precisely to clarify and organize whatever
evidence the parties might have thereon. It is a cause of great wonder
to the Court what urgent meeting could have befallen Capt. Padilla
resulting to his failure to appear in Court today.
28
14chanroblesvirtuallawlibrary
intent to examine their books of account and other accounting records

for all internal revenue taxes for 1997 and other unverified prior years.
Under the circumstances, it cannot rightly be said that the OSG was
Milwaukee complied with the directive and submitted its documents to
not guilty of inexcusable carelessness, presumptuousness,
CIR.
indifference to and neglect of duty in assuming that public respondent
Thereafter, CIR issued three undated assessment
would grant its oral motion for postponement, coming to court
noticescralaw4 together with a demand letter and explanation of the
unprepared and without a witness. Hence public respondent was well
deficiency tax assessments. Milwaukee allegedly owed a total
within its authority to deny the Republics oral motion for
of P173,063,711.58 corresponding to the deficiencies on income tax,
postponement of the hearings set on 19 and 20 October 1995 and
expanded withholding and value-added taxes for the 1997 taxable
require it, instead, to just formally offer its evidence within fifteen (15)
year. The table shows the supposed deficiency taxes due against
days from notice. Petitioner is not guilty of abuse of discretion, much
Milwaukee:cralaw5
less grave, nor can it be charged by petitioner with denial of due
Basic Tax
Interest
Compromise
Total
process. 15
Penalty
P43,114,980.66
P20,264,040.91
P25,000.00
P63,404,0
WHEREFORE, the instant petition for certiorari, prohibition and
mandamus is DENIED. The questioned Order of public respondent
Sandiganbayan dated 19 October 1995 denying the oral motion of
9,284.23
1,000.00
29,723.18
petitioner Republic of the Philippines for the postponement of the 19 19,438.95
and 20 October 1995 hearings as well as the Resolution dated 3
January 1996 denying petitioners motion for reconsideration, is
AFFIRMED.
72,108,530.81
37,496,436.02
25,000.00
109,629,9
Postponement on the grounds of absences of evidence; Requisites

(Sec. 3, Rule 30)
G.R. No. 173815 : November 24, 2010

P15,242,950.42
P57,796,761.16
P51,000.00
P173,063,
MILWAUKEE INDUSTRIES CORPORATION, Petitioner, v. COURT
In a lettercralaw6 dated February 21, 2000, Milwaukee protested the
OF TAX APPEALS and COMMISSIONER OF INTERNAL
assessments.
REVENUE, Respondents.
Due to CIR's inaction regarding its protest, on November 20, 2000,
DECISION
Milwaukee filed a petition for review before the CTA.cralaw7 This was
MENDOZA, J.:
docketed as CTA Case No. 6202.
This resolves the petition for certiorari cralaw1 under Rule 65 of the
After Milwaukee had presented its evidence-in-chief, CIR offered the
1997 Rules of Civil Procedure filed by petitioner Milwaukee Industries
testimony of Ms. Edralin Silario(Silario), the group supervisor of the
Corporation (Milwaukee) assailing the February 27, 2006 Verbal
BIR examiners, who conducted the examination of Milwaukee's
Order and the June 1, 2006 Resolutioncralaw2 of the Court of Tax
books. She testified on the Final Report she prepared for the BIR and
Appeals (CTA), in CTA Case No. 6202 entitled 'Milwaukee Industries
explained the grounds for the disallowance of the deductions being
Corporation v. Commissioner of Internal Revenue.'
claimed by Milwaukee on the following: (1) foreign exchange losses
The Facts
classified as miscellaneous expenses; and (2) interest and bank
In a Letter of Authority,cralaw3 dated July 17, 1998, public respondent
charges paid in 1997.
Commissioner of Internal Revenue (CIR) notified Milwaukee of its
29
Subsequently, Milwaukee manifested its intention to present

documentary rebuttal evidence.cralaw8 By its Order of July 11, 2005,
the CTA permitted Milwaukee to present rebuttal evidence starting
September 5, 2005.cralaw9 Milwaukee, however, moved for resetting
on the scheduled hearings, particularly on September 5, 2005 and
October 26, 2005.cralaw10
On January 16, 2006, Milwaukee was able to partially present its
rebuttal evidence in a commissioner's hearing.cralaw11 The CTA
scheduled another hearing on February 27, 2006.
On February 27, 2006, during the scheduled hearing, the CIR waived
its right to cross-examine Milwaukee's witness.cralaw12 The CTA then
asked Milwaukee to continue its presentation of rebuttal evidence. Not
prepared, Milwaukee moved for the postponement of the pre-marking
and presentation of its rebuttal evidence relative to the deductibility of
some interests and bank charges from its corporate income tax for the
year 1997 amounting to P18,128,498.26.
Immediately, the CTA issued a verbal order denying Milwaukee's
motion to be allowed additional commissioner's hearing for further
presentation of its rebuttal evidence. The CTA likewise gave
Milwaukee ten (10) days within which to submit its Formal Offer of
Rebuttal Evidence.cralaw13
Consequently, Milwaukee moved for reconsideration of the CTA's
verbal order. Milwaukee likewise moved to toll the running of the
period for filing its formal offer of rebuttal evidence.cralaw14
In its June 1, 2006 Resolution, the CTA denied Milwaukee's motion for
reconsideration but allowed its motion to suspend the period for filing
of formal offer of rebuttal evidence.cralaw15 Specifically, the CTA
stated:chanrobles virtual law library
This Court agrees with the respondent. The Court, upon motion,
allowed petitioner to present rebuttal evidence. However, it was
petitioner who asked for several postponements of trial and
commissioner's hearing, which lead the Court to issue final warnings
on October 26, 2005, January 16, 2006 and January 31, 2006.
It is worth stressing that the objective of the procedural rules is to
secure a just, speedy and inexpensive disposition of every action to
the benefit of all litigants. The Court will not countenance further delay
of the proceedings. Thus, the Court hereby RESOLVES to DENY
Petitioner's Motion for Reconsideration for lack of merit.
However, finding petitioner's Motion to Toll Running of the Period for
Filing Formal Offer of Rebuttal Evidence to be in order, the Court
hereby RESOLVES to GRANT the same.
WHEREFORE, petitioner is ordered to submit its Formal Offer of

Rebuttal Evidence within the remaining period prescribed by this
Court upon receipt of this Resolution. Respondent is given a period of
10 days to file his Comment thereto. Thereafter, petitioner's Formal
Offer of Rebuttal Evidence shall be deemed submitted for resolution.
SO ORDERED.cralaw16
On June 21, 2006, Milwaukee filed its Formal Offer of Rebuttal
Evidence (ex Abundanti ad Cautelam) before the CTA.cralaw17
Aggrieved by the denial of its motion for reconsideration of the verbal
order, Milwaukee filed this petition.
In its Memorandum,cralaw18 Milwaukee submits the following
ISSUES
WHETHER OR NOT RESPONDENT CTA COMMITTED GRAVE
ABUSE OF DISCRETION (AMOUNTING TO LACK OR EXCESS OF
JURISDICTION) IN DENYING PETITIONER'S MOTION TO BE
ALLOWED TO PRESENT REBUTTAL EVIDENCE, AND ITS
SUBSEQUENT MOTION FOR RECONSIDERATION THEREON:
A. Whether or not petitioner unduly delayed the case;
B. Whether or not petitioner was denied due process by not being
allowed to present its rebuttal evidence in relation to its disallowed
interest and bank charges for the year 1997; and chanrobles virtual
law library
C. Whether or not petitioner's proffered evidence, if allowed and
admitted, would have sufficiently substantiated its claims for
deductibility of the disallowed interest and bank charges.cralaw19
Milwaukee explained that it 'sought postponement of the 27 February
2006 hearing, but only because the same was originally scheduled for
respondent CIR's cross-examination of Milwaukee's witness.
Unexpectedly, on that very same hearing date, counsel for respondent
CIR suddenly manifested that he was waiving cross-examination.
Understandably, Milwaukee was constrained to request for
postponement of said hearing, not because it intended to delay the
proceedings, but because the evidence it intended to present, while
already available, was yet to be collated and sorted out for a more
orderly presentation.'cralaw20
Milwaukee claimed that the denial of its motions deprived it of its right
to have the case be decided on the merits. It wrote: 'Without said
countervailing evidence, the adjudication of the issue of deductibility
of certain interest and bank charges will [be] seriously impaired,
because it will not be based on substantial evidence or on the entire
facts.'cralaw21
30
The Court finds no merit in the petition.

In order for a petition for certiorari to succeed, the following requisites
must concur, namely: (a) that the writ is directed against a tribunal, a
board, or any officer exercising judicial or quasi-judicial functions; (b)
such tribunal, board, or officer has acted without or in excess of
jurisdiction, or with grave abuse of discretion amounting to lack or
excess of jurisdiction; and (c) there is no appeal, or any plain, speedy
and adequate remedy in the ordinary course of law.cralaw22 Without
jurisdiction denotes that the tribunal, board, or officer acted with
absolute lack of authority. There is excess of jurisdiction when the
public respondent exceeds its power or acts without any statutory
authority. Grave abuse of discretionconnotes such capricious and
whimsical exercise of judgment as to be equivalent to lack or excess
of jurisdiction; otherwise stated, power is exercised in an arbitrary or
despotic manner by reason of passion, prejudice, or personal hostility;
and such exercise is so patent or so gross as to amount to an evasion
of a positive duty or to a virtual refusal either to perform the duty
enjoined or to act at all in contemplation of law.cralaw23
'As a rule, the grant or denial of a motion for postponement is
addressed to the sound discretion of the court which should always be
predicated on the consideration that more than the mere convenience
of the courts or of the parties, the ends of justice and fairness should
be served thereby.'cralaw24 Furthermore, this discretion must be
exercised intelligently.cralaw25
In this case, the Court is of the view that the CTA gave enough
opportunity for Milwaukee to present its rebuttal evidence. Records
reveal that when Milwaukee requested for resetting on September 5,
2005 and October 26, 2005, its motions were granted by the CTA. As
a matter of fact, by January 16, 2006, Milwaukee was already able to
partially present its rebuttal evidence. Thus, when the CTA called on
Milwaukee to continue its presentation of rebuttal evidence on
February 27, 2006, it should have been prepared to do so. It cannot
be said that the CTA arbitrarily denied Milwaukee's supposed simple
request of resetting because it had already given the latter several
months to prepare and gather its rebuttal evidence.
Milwaukee tried to reason out that if only the CIR gave an advance
notice that it would be waiving its right to cross-examine its witness,
then it could have 'rushed the collation and sorting of its rebuttal
documentary exhibits.'cralaw26
The Court, however, is not persuaded.
As stated earlier, Milwaukee was given more than ample time to

collate and gather its evidence. It should have been prepared for the
continuance of the trial. True, the incident on said date was for the
cross-examination of Milwaukee's witness but it could be short; it
could be lengthy. Milwaukee should have prepared for any eventuality.
It is discretionary on the part of the court to allow a piece-meal
presentation of evidence. If it decides not to allow it, it cannot be
considered an abuse of discretion. 'As defined, discretion is a faculty
of a court or an official by which he may decide a question either way,
and still be right.'cralaw27
Accordingly, Milwaukee's right to due process was not transgressed.
The Court has consistently reminded litigants that due process is
simply an opportunity to be heard.cralaw28 The requirement of due
process is satisfactorily met as long as the parties are given the
opportunity to present their side. In the case at bar, Milwaukee was
precisely given the right and the opportunity to present its side. It was
able to present its evidence-in-chief and had its opportunity to present
rebuttal evidence. chan virtual library.
WHEREFORE, the petition is DENIED.
SO ORDERED.
Order of Trials maybe Changed
[G.R. No. L-29742. March 29, 1972.]
VICENTE YU, Plaintiff-Appellant, v. EMILIO MAPAYO, DefendantAppellee.
Leonor S. Lozano for plaintiff and appellant
Gregorio A. Palabrica for defendant and appellee.
SYLLABUS
1. REMEDIAL LAW; DISMISSAL FOR FAILURE TO PROSECUTE;
NOT PROPER WHERE ALLEGATIONS IN COMPLAINT ADMITTED
IN ANSWER. Where the answer admits defendants obligation as
stated in the complaint, albeit special defenses are pleaded, plaintiff
has every right to insist that it is for defendant to come forward with
evidence in support of his special defenses. Defendant not having
31
supported his special defenses, the dismissal of the case for failure to
prosecute on the part of counsel for the plaintiff was manifestly
untenable and contrary to law.
attorneys fees. The City Court, after trial, disallowed the defenses and
ordered the defendant to pay plaintiff P2,500.00 and costs (Record on
Appeal, pages 9-16).
2. ID.; ID.; ID.; SECTION 2 RULE 129, REVISED RULES OF COURT

SUPPORTS PLAINTIFFS REFUSAL TO PRESENT EVIDENCE.
Plaintiffs counsel refused to comply with the order of the trial court
requiring plaintiff to present his evidence. Instead of calling his
witnesses, he moved the court to present them after the defendant
had presented their evidence. Such a stand is supported by Section 2
of the Revised Rule of Court 129.
Defendant Mapayo appealed to the Court of First Instance, filing an

answer therein that was a virtual reproduction of his original defenses
in the City Court. When, after several continuances, the case was
called for hearing on 13 March 1968, the defendant, as well as his
counsel, failed to appear and the court scheduled the case for hearing
ex parte on the same day. The Court ordered plaintiff to present his
evidence, and from the unchallenged stenographic notes quoted in
appellants brief, pages 11-14 (Transcript, pages 4-7), the following
transpired:jgc:chanrobles.com.ph
3. ID.; ID.; ID.; RULES OF JUDICIAL ETHICS VIOLATED BY JUDGE

IN CASE AT BAR. While this appeal is not a complaint against the
presiding judge, We cannot refrain from observing that the trial judges
despotic and outrageous insistence that plaintiff should present proof
in support of allegations that were not denied but admitted by the
adverse party was totally unwarranted, and was made worse by the
trial judges continual interrupting of the explanations of counsel, in
violation of the rules of judicial ethics.
"ATTY. LOZANO:chanrob1es virtual 1aw library

If your Honor please, before I present my witness I should like to
present the issue because all the allegations of the complaint are
admitted and I am going to specify by the answer, your Honor. (Italics
supplied)
COURT:chanrob1es virtual 1aw library
DECISION
The issue is void on the hidden defect.
REYES, J.B.L., J.:
ATTY. LOZANO:chanrob1es virtual 1aw library
Appeal from an order of the Court of First Instance of Davao City,

Branch II (Judge Alfredo I. Gonzalez presiding), rendered in its Civil
Case No. 4018, dismissing plaintiffs action for lack of prosecution.
That is why, if your Honor please, the point if your Honor please, is I
do not have to prove that there is a gasoline engine that was taken by
the defendant from the plaintiff for an agreed amount of P6,800.00
because the allegation in paragraph 1, No. 2 and No. 3, is admitted in
the answer.
The case originally started in the City Court of Davao, Branch II,
where appellant therein had filed suit to recover from defendant Emilio
Mapayo the sum of P2,800, representing the unpaid balance of the
purchase price of a Gray Marine Engine sold by the plaintiff to the
defendant, plus attorneys fees. The answer admitted the transaction
and the balance due but contended that by reason of hidden defects
of the article sold, the defendant had been forced to spend P2,800 for
repairs and labor, wherefore plaintiff had agreed to waive the balance
due on the price of the engine, and counterclaimed for damages and
In other words, if your Honor please, the promissory note in the

amount of P2,800.00 . . . (interrupted by court).
Wait a minute, are you going to present evidence or not?
32
Will you please give me a chance, if your Honor please, because my

purpose is, it will turn out that it will be the defendant to present
evidence to prove that there is hidden defect. He admitted the
allegation, he admitted that there is a balance of P2,800.00; it is not
paid by him but at the same time he said that there is a hidden defect.
In other words, if your Honor please, it should be the defendant to
present the evidence . . . (interrupted by court).
will present evidence and I reserve my right to present rebuttal

evidence. (Italics supplied)
Make it of record that the attorney refuses to present evidence either
oral or documentary when required by the Court.
Are you going to present evidence, substantial, oral, or not? Answer

the question of the Court.
Motion for reconsideration, if your Honor please, that is not what I

said, if your Honor please, I manifested that it should be the defendant
to prove first, to present evidence and we reserve our right to present
rebuttal evidence, if your Honor please (Italics supplied).
If your Honor please, on the complaint, on the allegation of the

complaint, all are admitted by the defendant . . . (interrupted by court.
All right, denied.

Submit the case for the consideration of the Court."

The attorney does not answer the question of the Court.
Answer the question, are you going to present evidence OR NOT
AND SUBMIT THE CASE ON THE PLEADINGS. (Capitals supplied)
Would you please allow me, your Honor, because in the answer of the
defendant . . . (interrupted by court)
The court then issued an order on the same day in the following terms
(Record on Appeal, page 24):jgc:chanrobles.com.ph
"O R D E R
Make it of record that the attorney for the plaintiff refuses to present
evidence, either oral or documentary, when required by the Court.
Submit the case for the consideration of the Court.
SO ORDERED."cralaw virtua1aw library

I do not need discussion; I want you to answer the question of the
Court.
A motion for reconsideration having been filed by counsel for plaintiff,

it was denied by the court by an order of 21 March, and the case was
dismissed for lack of prosecution (Record on Appeal, pages 34-35),
the trial judge reasoning that

I am not going to present my evidence yet because at this moment I
am submitting my evidence on the pleading until after the defendant
"When the case is called for trial on 19 March 1968, defendants

counsel asked again for another postponement of the trial on the
ground that defendant and his witnesses were not able to come for
33
lack of transportation, notwithstanding a stern warning by the Court,

per its order of 9 March 1968 that it would not entertain further motion
for continuation of trial. Counsel for the plaintiff vehemently objected
to such motion and insisted in presenting his evidence which the
Court grants inspite of another civil case and one miscellaneous case
which were ready for hearing at the same time.
"Court ordered the plaintiff to present his evidence. Plaintiffs counsel
refused to comply with said order Instead of calling his witnesses, he
moved the Court to present them after the defendant had presented
their evidence. The court asked said counsel twice whether he would
present his evidence for the plaintiff, but said counsel refused to do so
and stacked to his demand that he would introduce his witnesses only
in rebuttal. This is dictation to the Court to disregard its lawful
command and a violation of the order of trial provided in the Rules of
Court.
"This is an appealed case from the Municipal Court elevated to this
Court on 18 May 1963 and from that time several postponement were
granted at the instance of the parties which cause delay and is
detrimental to the interest of justice.
"Sec. 2. Judicial admissions. Admissions made by the parties in the

pleadings, or in the course of the trial or other proceedings do not
require proof and can not be contradicted unless previously shown to
have been made through palpable mistake."cralaw virtua1aw library
While this appeal is not a complaint against the presiding judge, We
can not refrain from observing that the trial judges despotic and
outrageous insistence that plaintiff should present proof in support of
allegations that were not denied but admitted by the adverse party
was totally unwarranted, and was made worse by the trial judges
continual interrupting of the explanations of counsel, in violation of the
rules of Judicial Ethics.
Defendant not having supported his special defenses, the dismissal of
the case was manifestly untenable and contrary to law.
WHEREFORE, the appealed order of dismissal is hereby revoked and
set aside, and the court below is directed to enter judgment in favor of
plaintiff and against the defendant for the sum of P2,800.00, plus
attorneys fees which this Court considers just and reasonable (Civil
Code, Article 2208, paragraph 11) . Costs against DefendantAppellee.
"IN VIEW WHEREOF, let this case be dismissed for failure to

prosecute on the part of counsel for the plaintiff without
pronouncement as to costs.
Let a copy of this decision be furnished the Honorable, the Secretary

of Justice, for his information and action.
"Finding defendants counterclaim not meritorious, same is also

dismissed.
Concepcion, C.J., Makalintal, Castro, Fernando, Teehankee, Barredo,

Villamor and Makasiar, JJ., concur.
"SO ORDERED."cralaw virtua1aw library
Zaldivar, J., did not take part.
Further motions to reconsider having proved futile, the plaintiff

appealed.
Three ways of Consolidation
We find, for Plaintiff-Appellant. Since the answer admitted defendants

obligation as stated in the complaint, albeit special defenses were
pleaded, plaintiff had every right to insist that it was for defendant to
come forward with evidence in support of his special defenses.
Section 2 of Revised Rule of Court 129 plainly supports
appellant:jgc:chanrobles.com.ph
[G.R. No. 45642. September 25, 1937.]

FRANCISCO SALAZAR, Petitioner, v. THE COURT OF FIRST
INSTANCE OF LAGUNA and SABINA RIVERA, Respondents.
Crispin Oben for Petitioner.
34
Estanislao A. Fernandez for respondent Rivera.
in this case, did not exempt the respondent from paying the fees in
question but merely failed to make provision therefor.
No appearance for other Respondent.

SYLLABUS
1. WILLS; PROBATE; JURISDICTION. A Court of First Instance
acquires jurisdiction to probate a will when it is shown by evidence
before it: (1) That a person has died leaving a will; (2) in the case of a
resident of this country, that he died in the province where the court
exercises territorial jurisdiction; (3) in the case of a nonresident, that
he has left a estate in the province where the court is situated and (4)
that the testament or last will of the deceased has been delivered to
the court and is in the possession thereof.
2. ID.; ID.; ID.; SECOND WILL; FEES OF CLERK OF COURT.
According to the facts alleged and admitted by the parties, it is evident
that the court has acquired jurisdiction to probate the second will,
presented by the respondent, in view of the presence of all the
jurisdictional facts above-stated. The respondents counter-petition
should, in this case, be considered as a petition for the probate of the
second will, the original of which was filed by her on July 20, 1937.
The payment of the fees of e clerk of court for all services to be
rendered by him in connection with the probate of the second will and
for the successive proceedings to be conducted and orders to be
issued, in accordance with section 788, as amended, is not
jurisdictional in the sense that its omission does not deprive the court
of its authority to proceed with the probate of a will, as expressly
provided for by section 630. It is the inevitable duty of the court, when
a will is presented to it, to appoint hearing for its allowance and to
cause notices thereof to be given by publication. The duty imposed by
said section is imperative and noncompliance therewith would be a
mockery at the law and at the last will of the testator.
3. ID.; ID.; ID.; ID. Section 785 (a) of the Code of the Civil
Procedure, as amended recently by Act No. 3250, permits the
remission or postponement of the payment of the clerks fees in cases
of poverty, at the discretion of the court, and if this were done in one
case and the payment of the fees for filing the application were
jurisdictional, as claimed, then the court, in admitting the will to
probate and in allowing it, would have acted entirely without
jurisdiction. Finally, it should be taken into consideration that the court,
4. ID.; ID.; ID.; CONSOLIDATION OF SPECIAL PROCEEDINGS.

When the court ordered that the second will be set for hearing, that
publication be made thereof and that said will be heard in the same
proceeding jointly with the first will, it merely ordered the consolidation
of the two applications and the two hearings on the probate of both
wills, instead of conducting separate hearings, undoubtedly because it
understood that the form so chosen was the most convenient for the
parties and their attorneys. There are three ways of consolidating
actions or special proceedings where the questions at issue and the
parties in interest are the same. The first consists in recasting the
cases already instituted, conducting only one hearing and rendering
only one decision; the second takes place when the existing cases
are consolidated, only one hearing held and only one decision
rendered; and the third takes place when, without recasting or
consolidating the cases, the principal one is hear, the hearing on the
others being suspended until judgment has been rendered in the first
case.
5. ID.; ID.; ID.; ID. The court, in the exercise of its sound discretion,
may adopt any of these three forms of consolidation whenever in its
opinion the proceeding is beneficial to and convenient for the parties.
The power so exercised is discretionary. In the case under
consideration, the court acquired jurisdiction from the moment the
counter-petition was presented and the second will came to its
possession and under its control and, consequently, it likewise had full
discretion to order, as it did, the probate thereof in the proceeding
already instituted for the purpose of rendering later only one decision.
The consolidation so ordered was the form most convenient for and
beneficial to the parties as well as to the court, because if the first will
were opposed on the ground that it was revoked by the second will,
the best evidence of revocation would be the second will, and once
the publications are made, if the second will was executed with the
formalities prescribed by law, the court could order the probate
thereof, without the necessity of multiplying the proceedings.
DECISION
35
said section, as amended, reads as follows:jgc:chanrobles.com.ph

IMPERIAL, J.:
The petitioner instituted special proceeding No. 3109 in the Court of
First Instance of Laguna and, in the petition filed by him, prayed for
the probate of the will allegedly made on May 13, 1924, by his
deceased mother Damiana Capistrano, who died in the municipality of
Pagsanjan, Laguna, on December 21, 1936. The petition was
opposed by the respondent Sabina Rivera, who filed a pleading
entitled "Opposition and Counter-Petition." In her pleading the
respondent, after opposing the probate of said will for the reasons
stated therein, prayed for the probate of the will of the deceased
allegedly made on May 11, 1930, copy of which was attached thereto,
and for the issuance, to that effect, of the order setting the hearing
thereof and directing such publications as required by law. The court
denied the motion for publication and ordered the respondent to
institute another proceeding and apply separately for the probate of
the alleged will. The respondent filed a motion for reconsideration and
the court, on March 31, 1937, issued an order setting aside the former
one and directing that the will presented by the respondent be set for
hearing, that the publications required by law be made and that said
will be heard jointly will the will presented by the petitioner in the same
proceeding instituted by the latter. Sometime later, the court ordered
that the expenses for the publications made in the newspapers be
defrayed by the Respondent. The petitioner filed two motions for
reconsideration which were denied and, finally, instituted
thiscertiorari proceeding. In order that the hearing and publications
ordered by the court may be carried out, the respondent, on July 20,
1937, deposited P24 and filed the original of the will the probate of
which had been sought by her.
I. The petitioner raises only one question of law, to wit: that the court
acquired no jurisdiction to take cognizance of the counter- petition for
the probate of the second will, or to set the same for hearing and to
order, as it did, the publications to be made and the hearing of said
will to be held in the same proceeding jointly with the first will, on the
ground that the respondent had not previously filed her pleading nor
paid the fees of the clerk of court fixed by section 788 of the Code of
Civil Procedure, as amended by Act No. 3395. The pertinent part of
"SEC. 788. Fees of clerks of Court of First Instance. Fees shall be

assessed in accordance with the following schedule:chanrob1es
virtual 1aw library
x
x
x
"(g) For all clerical services in the allowance of wills, granting letters of
administration, appointment of guardians, trustees, settlement of the
accounts of executors, administrators, guardians, trustees, and
recording final and interlocutory orders, judgments, and decrees
therein, filing all inventories and appraisements, and for all other work
as clerk pertaining to any one estate, fees payable out of the estate
shall be collected in accordance with the value of the property
involved in each proceeding, as follows:"
x
x
x
The jurisdiction of the Courts of First Instance in probate matters is
determined in the following sections of the above-cited
Code:jgc:chanrobles.com.ph
"SEC. 599. Jurisdiction. Courts of First Instance shall have
jurisdiction in all matters relating to the settlement of estates and
probate of wills of deceased persons, the appointment and removal of
guardians and trustees, and the powers, duties, and rights of
guardians and wards, trustees, and cestuis que trust. This jurisdiction
shall be called probate jurisdiction.
"SEC. 600. Where residents estate settled. If an inhabitant of the
Philippine Islands dies, whether a citizen or alien, his will shall be
proved, or letters of administration granted, and his estate settled, in
the Court of First Instance in the province in which he resided at the
time of his death.
"SEC. 601. Where nonresidents estate settled. If a person resided
out of the Philippine Islands at the time of his death, his will shall be
allowed and recorded, and letters testamentary or of administration
shall be granted in the Court of First Instance of any province in which
he had estate."cralaw virtua1aw library
36
"SEC. 626. Custodian of will to deliver. The person who has the
custody of a will shall, within thirty days after he knows of the death of
the testator, deliver the will into the court which has jurisdiction, or to
the executor named in the will.
"SEC. 627. Executor to present will and accept or refuse trust. A
person named as executor in a will, shall within thirty days after he
knows of the death of the testator, or within thirty days after he knows
that he is named executor, if he obtained such knowledge after
knowing of the death of the testator, present such will to the court
which has jurisdiction, unless the will has been otherwise returned to
said court, and shall, within such period, signify to the court his
acceptance of the trust, or make known in writing his refusal to accept
it."cralaw virtua1aw library
x
x
x
"SEC. 630. Court to appoint hearing on will. When a will is
delivered to a court having jurisdiction of the same, the court shall
appoint a time and place when all concerned may appear to contest
the allowance of the will, and shall cause public notice thereof to be
given by publication in such newspaper or newspapers as the court
directs of general circulation in the province, three weeks
successively, previous to the time appointed, and no will shall be
allowed until such notice has been given. At the hearing all testimony
shall be taken under oath, reduced to writing and signed by the
witnesses."cralaw virtua1aw library
Under the foregoing provisions, a Court of First Instance acquires
jurisdiction to probate a will when it is shown by evidence before it: (1)
That a person has died leaving a will; (2) in the case of a resident of
this country, that he died in the province where the court exercises
territorial jurisdiction; (3) in the case of a nonresident, that he has left
a estate in the province where the court is situated, and (4) that the
testament or last will of the deceased has been delivered to the court
and is in the possession thereof.
The law is silent as to the specific manner of bringing the jurisdictional
allegations before the court, but practice and jurisprudence have

established that they should be made in the form of an application and
filed with the original of the will attached thereto. It has been the
practice in some courts to permit attachment of a mere copy of the will
to the application, without prejudice to producing the original thereof at
the hearing or when the court so requires. This precaution has been
adopted by some attorneys to forestall its disappearance, which has
taken place in certain cases.
that the court has acquired jurisdiction to probate the second will, in
view of the presence of all the jurisdictional facts above- stated. The
respondents counter-petition should, in this case, be considered as a
petition for the probate of the second will, the original of which was
filed by her on July 20, 1937.
II. The payment of the fees of the clerk of court for all services to be
for the successive proceedings to be conducted and orders to be
jurisdictional in the sense that its omission does not deprive the court
of its authority to proceed with the probate of a will, as expressly
cause notices thereof to be given by publication. The duty imposed by
mockery at the law and at the last will of the testator. Section 785 (a)
of the Code of Civil Procedure, as amended recently by Act No. 3250,
permits the remission or postponement of the payment of the clerks
fees in cases of poverty, at the discretion of the court, and if this were
done in one case and the payment of the fees for filing the application
were jurisdictional, as claimed, then the court, in admitting the will to
in this case, did not exempt the respondents from paying the fees in
question but merely failed to make provision thereof.
III. When the court ordered that the second will be set for hearing, that
of the two applications and the two hearings on the probate of both
37
wills, instead of conduction separate hearings, undoubtedly because it

parties and their attorneys.
There are three ways of consolidating actions or special proceedings
where the questions at issue and the parties in interest are the same.
The first consists in recasting the cases already instituted, conducting
only one hearing and rendering only one decision; the second takes
place when the existing cases are consolidated, only one hearing held
and only one decisions rendered: and the third takes place when,
without recasting or consolidating the cases, the principal one is
heard, the hearing on the others being suspended until judgment has
been rendered in the first case. The court, in the exercise of its sound
discretion, may adopt any of these three forms of consolidation
whenever in its opinion the proceeding is beneficial to and convenient
for the parties. The power so exercised is discretionary. In the case
under consideration, the court acquired jurisdiction from the moment
the counter-petition was presented and the second will came to its
It should furthermore be taken into consideration that the
consolidation so ordered was the form most convenient for the
beneficial to the parties as well as to the court, because if the first will
the best evidence of the revocation would be said second will and
once the publications are made, f the second will was executed with
the formalities prescribed by law, the court could order the probate
The decisions inserted hereinbelow are in support of the consolidation
of special proceedings in the cases where more than one will of a
deceased person has been presented:jgc:chanrobles.com.ph
"The question involved in the two cases is, which, if either, of the
instruments presented for probate is the last will of Margaret Roulett.
The trial of one case would not necessarily determine the other, as a
verdict in one for the caveat would not establish the instrument
propounded in the other, and a verdict in Rouletts case, finding that
the paper offered by him was the last will of Margaret Roulett, would
not be binding upon Mulherin, because he is not a party to Rouletts
proceeding. We are, therefore, of the opinion, in view of the

complications that might arise from separate trials and the facility with
which the whole matter may be determined by consolidating the
cases, that the trial judge might, in his discretion, pass an order
directing that the two cases be consolidated and heard together, and
in this manner have all the issues disposed of by a judgment binding
and conclusive upon all the parties before the court. In such trial the
person who filed the first application in the court of ordinary would be
entitled to open and conclude." (Roulett v. Mulherin, 100 Ga., 594.)
"In probate proceedings it was a proper course to try the validity of
two alleged wills, the latest of which had been lost or destroyed at the
same time, and evidence as to the revoking clause in the lost will was
admissible, but its effect on the earlier will must be determined in view
of the admissibility of the latter will to probate as a will." (In re
Thompsons Estate, 198 Pac., 795.)
"Where two wills are offered for probate and applications
consolidated, submission of both for determination as to whether one,
or if not that the other, is true will, held not erroneous." (Lillard v.
Tolliver, 285 S. W., 576.)
"Where two will are offered for probate and applications consolidated,
submission of both for determination as to whether one, or if not that
the other, is true will, held not erroneous." (Lillard v. Tolliver, 285 S. W.,
576.)
"Where two instruments are propounded by different parties as wills,
and several applications are made for probate, they will be
consolidated and tried together as one proceeding." (In re Potters
Will, 155 N. Y. S., 939.)
"The question of consolidation is discretionary with the court. In both
of the above-entitled proceedings, the parties are identical. No issues
have been tried in either proceeding. It therefore would be an
unnecessary expense to both the parties in interest and the county,
and an unnecessary delay in the determination of both proceedings,
not to consolidate them. I am therefore of the opinion that a
seasonable demand was made for a jury trial of the issues raised by
the objections filed to the probate of the will dated May 8, 1912, and
that the proceedings should be consolidated, and also that the issues
38
raised in said proceedings can be more speedily and conveniently

tried before the acting surrogate and a jury." (In re Potters Will, 158 N.
Y. S., 1001.)
IMPERIAL, J.:
"Where separate scripts are propounded for probate as the last will
and testament of an alleged testator, the probate proceedings in a
proper case may be consolidated for trial." (In re Martins Will, 141 N.
Y. S., 784.)
The attorney for the petitioner seeks permission to file a second

motion for reconsideration already attached to his petition. With the
motion for reconsideration before it, this court will now take up the
same for decision on its merits.
"Consolidation of proceedings. At common law the court could

order all testamentary papers to be produced in court in a proceeding
to probate any one of them, and now, under the statutory procedure in
effect in the various jurisdictions, the validity of two or more papers
claimed to be the last will and testament of deceased may be tried at
the same time, or a consolidation of separate proceedings to probate
or contest various testamentary papers purported to be by the same
testator may be made. A motion for such a consolidation, however, is
addressed t the surrogate presiding at the trial and should be made
when the trial of the probate proceeding comes on for the hearing and
not prior thereto, or before the surrogate sitting for the dispatch of
chambers business." (68 C. J., 1038, 1039, sec. 830.)
It is alleged that the interpretation of paragraph (g) of section 788 of

the Code of Civil Procedure, as amended by section 1 of Act No.
3395, was one of the questions raised by the petition for certiorari, but
that both in the decision and in the resolution of the motion for
reconsideration this court has neither given nor interpreted the
meaning and scope of the phrase "in each proceeding" appearing at
the end of the legal provision in question.
"The court may, in its discretion, consolidate proceedings instituted by

different persons for the purpose of having different instruments each
probated as the last will and testament of decedent. Separate
contests of a will and codicil, or of two will, each claimed to be the last
will of testator, may be consolidated by the court and heard together."
(Page on Wills, page 375, paragraph 323.)
It is the conclusion of this court, therefore, that the respondent court
did not act in excess of its sound discretion in issuing the order of
March 31, 1937, and for the foregoing reasons, the remedy applied for
is hereby denied, with costs to the petitioner. So ordered.
Avancea, C.J., Villa-Real, Abad Santos, Diaz, Laurel and
Concepcion, JJ., concur.
RESOLUTION
October 13, 1937.
On page 2 of the decision, this court stated that the only question of
law raised by the petition was whether or not the court had acquired
jurisdiction when it provided in its orders that the counter-petition and
the second will be heard in the proceeding already instituted at the
initiative of the petitioner and that the expenses of publication of the
hearing be defrayed by the Respondent. This court then said: "The
petitioner raises only one question of law, to wit: that the court
acquired no jurisdiction to take cognizance of the counter-petition for
Civil Procedure, as amended by Act No. 3395."cralaw virtua1aw
library
In connection with the fees of the clerk of court prescribed by section
788 (g) of the Code of Civil Procedure, as amended, the court, on
pages 6 and 7 of the decision, said: "The payment of the fees of the
clerk of curt for all services to be rendered by him in connection with
the probate of the second will and for the successive proceedings to
be conducted and orders to be issued, in accordance with section
788, as amended, is not jurisdictional in the sense that its omission
does not deprive the court of its authority to proceed with the probate
39
of a will, as expressly provided for by section 630. It is the inevitable

duty of the court, when a will is presented to it, to appoint hearing for
its allowance and to cause notices thereof to be given by publication.
The duty imposed by said section is imperative and noncompliance
therewith would be a mockery at the law and at the last will of the
testator. Section 785 (a) of the Code of Civil Procedure, as amended
recently by Act No. 3250, permits the remission or postponement of
the payment of the clerks fees in cases of poverty, at the discretion of
the court, and if this were done in one case and the payment of the
fees for filing the application were jurisdictional, as claimed, then the
court, in admitting the will to probate and in allowing it, would have
acted entirely without jurisdiction. Finally, it should be taken into
consideration that the court, in this case, did not exempt the
respondents from paying the fees in question but merely failed to
make provision therefor."cralaw virtua1aw library
It having been decided that the payment of said fees is not
jurisdictional, this court, in fact, determined the principal and only
question of law raised by the petition and there was no necessity of
interpreting said legal provision for the purpose of laying down
another unnecessary conclusion.
In the second motion for reconsideration, however, the attorney for the
petitioner asks this court to interpret expressly the phrase "in each
proceeding" to determine whether or not the respondent was and is
obliged to pay said clerks fees. If the interpretation asked for is to
determine whether or not the respondent was and is obliged to pay
said clerks fees. If the interpretation asked for is to determine the
question of jurisdiction, that is, whether or not the court acquired
jurisdiction in issuing its orders appealed from, it has already been
done and it was said that the payment of said fees is not jurisdictional.
If the interpretation sought to be obtained is for the purpose of having
this court decide now whether the respondent should, or should not,
pay the clerks fees, then this court holds that such pronouncement is
unnecessary and improper for the following reasons: (1) Because to
decide whether or not the petition is meritorious, there is no necessity
of determining whether or not the respondent is obliged to pay the
clerks fees, and (2) because it behooves the lower court to decided
this question in the first instance and it is improper for this appellate
court to exercise the functions belonging to the former.
In view of the foregoing, the second motion for reconsideration is

denied.
G.R. No. 45642
September 25, 1937
FRANCISCO SALAZAR, petitioner,
vs.
THE COURT OF FIRST INSTANCE OF LAGUNA and SABINA
RIVERA, respondents.
Crispin Oben for petitioner.
Estanislao A. Fernandez for respondent Rivera.
IMPERIAL, J.:
The petitioner instituted special proceeding No. 3109 in the court of
First Instance of Laguna and, in the petition filed by him, prayed for
the probate of the will allegedly made on May 13, 1924, by his
deceased mother Damiana Capistrano, who died in the municipality of
Pagsanjan, Laguna, on December 21, 1936. The petition was
opposed by the respondent Sabina Rivera, who filed a pleading
entitled "Opposition and Counter-Petition." In her pleading the
respondent, after opposing the probate of said will for the reasons
stated therein, prayed for the probate of the will of the deceased
alleged made on May 11, 1930, copy of which was attached thereto,
and for the issuance, to that effect, of the order setting the hearing
thereof and directing such publications as required by law. The court
denied the motion for publication and ordered the respondent to
institute another proceeding and apply separately for the probate of
the alleged will. The respondent filed a motion for reconsideration and
the court, on March 31, 19937, issued an order setting aside the
former one and directing that the will presented by the respondent be
set for hearing, that the publications required by law be made and that
said will be heard jointly with the will presented by the petitioner in the
same proceeding instituted by the latter. Sometime later, the court
ordered that the expenses for the publications made in the
newspapers be defrayed by the respondent. The petitioner filed two
motions for reconsideration which were denied and, finally, instituted
this certiorari proceeding. In order that the hearing and publications
ordered by the court may be carried out, the respondent, on July 20,
40
1937, deposited P24 and filed the original of the will the probate of
which had been sought by her.
I. The petitioner raises only one question of law, to wit: that the court
the probate of the second will, or to set the same for hearing of said
Civil Procedure, as amended by Act No. 3395. The pertinent part of
said section, as amended, reads as follows:
SEC. 788. Fees of clerks of Court of First Instance. Fees shall
assessed in accordance with the following schedule:
xxx
xxx
xxx
(g) For all clerical services in the allowance of wills, granting letters of
administration, appointment of guardians, trustees, settlement of the
accounts of executors, administrators, guardians, trustees, and
recording final and interlocutory orders, judgment, and decrees
therein, filing all inventories and appraisements, and for all other work
as clerk pertaining to any one estate, fees payable out of the estate
shall be collected in accordance with the value of the property
involved in each proceeding, as follows:
xxx
xxx
xxx
The jurisdiction of the Courts of First Instance in probate matters is
determined in the following sections of the above-cited Code:
SEC. 599. Jurisdiction. Courts of First Instance shall have
jurisdiction in all matters relating to the settlement of estate and
probate of wills of deceased persons, the appointment and removal of
guardians and trustees, and the powers, duties, and rights of
guardians and wards, trustees, and cestuis que trust. This jurisdiction
shall be called probate jurisdicton.
SEC. 600. Where resident's estate settled. If an inhabitant of the
Philippine Islands dies, whether a citizen or alien, his will shall be
proved, or letters of administration granted, and his estate settled, in
the Court of First Instance in the province in which he resided at the
time of his death.
SEC. 601. Where nonresident's estate settled. If a person resided
out of the Philippine Islands at the time of his death, his will shall be
allowed and recorded, and letters testamentary or of administration
shall be granted in the Court of First Instance of any province in which
he had estate.
xxx
xxx
xxx
SEC. 626. Custodian of will to deliver. The person who has the
custody of a will shall, within thirty days after he knows of the death of
the testator, deliver the will into the court which has jurisdiction, or to
the executor named in the will.
SEC. 627. Executor to present will and accept or refuse trust. A
person named as executor in a will, shall within thirty days after he
knows of the death of the testator, or within thirty days after he knows
that he is named executor, if he obtained such knowledge after
knowing of the death of the testator, present such will to the court
which has jurisdiction, unless the will has been otherwise returned to
said court, and shall, within such period, signify to the court his
acceptance of the trust, or make known in writing his refusal to accept
it.
xxx
xxx
xxx
SEC. 630. Court to appoint hearing on will. When a will is delivered
to a court having jurisdiction of the same, the court shall appoint a
time and place when all concerned may appear to contest the
allowance of the will, and shall cause public notice thereof to be given
by publication in such newspapers as the court directs general
circulation in the province, three weeks successively, previous to the
time appointed, and no will shall be allowed until such notice has been
given. At the hearing all testimony shall be taken under oath, reduced
to writing and signed by the witnesses.
Under the foregoing provisions, a Court of First Instance acquires
jurisdiction to probate a will when it is shown by evidence before it: (1)
That a person has died leaving a will; (2) in the case of a resident of
this country, that he died in the province where the court exercises
territorial jurisdiction; (3) in the case of a nonresident, that he has left
a estate in the province where the court is situated, and (4) that the
testament or last will of the deceased has been delivered to the court
and is in the possession thereof.
The law is silent as to the specific manner of bringing the jurisdictional
allegations before the court but practice and jurisprudence have
established that they should be made in the form of an application and
filed with the original of the will attached thereto. It has been the
practice in some courts to permit attachment of a mere copy of the will
to the application, without prejudice to producing the original thereof at
the hearing or when the court so requires. This precaution has been
adapted by some attorneys to forestall its disappearance, which has
taken place in certain cases.
41

that the court has acquired jurisdiction to probate the second will, in
view of the presence of all the jurisdictional facts above-stated. The
respondent's counter-petition should, in this case, be considered as a
petition for the probate of the second will, the original of which was
filed by her on July 20, 1937.
II. The payment of the fees of the clerk of court for all services to be
for the successive proceedings to be conducted and others to be
jurisdiction in the sense that its omission does not deprive the court of
its authority to proceed with the probate of a will, as expressly
cause notice thereof to be given by publication. The duty imposed by
mockery at the law and at last will of the testator. Section 785 (a) of
the Code of Civil Procedure, as amended recently by Act No. 3250,
permits the remission or postponement of the payment of the clerk's
fees in cases of poverty, at the discretion of the court, and if this were
done in one case and the payment of the fees for filing the application
were jurisdictional, is claimed, then the court, in admitting the will to
question but merely failed to make provision therefor.
III. When the court ordered that the second will be set for hearing that
of the two applications and the two hearing on the probate of both
wills, instead of conducting separate hearing, undoubtedly because it
parties and their attorneys.
There are three ways of consolidation action or special proceedings
where the questions at issue and the parties in interest are the same.
The first consists in recasting the cases already instituted, conducting
only one hearing and rendering only one decision; the second takes
place when the existing cases are consolidated, only one hearing held
and only one decision rendered; and the third takes place when,
without recasting or consolidating the cases, the principal one is
heard, the hearing on the others being suspended until judgment has
been rendered in the first case. The court, in the exercise of its sound
discretion, may adopt any of these three forms of consolidation
whenever in its opinion the proceeding is beneficial to and convenient
for the parties. The power so exercised is discretionary. In the case
under consideration, the court acquired jurisdiction from the moment
the counter-petition was presented and the second will came to its
It should furthermore be taken into consideration that the
consolidation so ordered was the form most convenient for and
beneficial to the parties as well as to the court because if the first will
the best evidence of the revocation would be said second will and
once the publications are made, if the second will was executed with
the formalities prescribed by law, the court could order the probate
The decisions inserted hereinbelow are in support of the consolidation
of special proceedings in the cases where more than one will of a
deceased person has been presented:
The question involved in the two cases is, which, if either, of the
instruments presented for probate is the last will of Margaret Roulett.
The trial of one case would not necessarily determine the other, as a
verdict in one for the caveat would not establish the instrument
propounded in the other, and a verdict in Roulett's case, finding that
the paper offered by him was the last will of Margaret Roulett, would
not be binding upon Mulherin, because he is not a party to Roulett's
proceeding. We are, therefore, of the opinion, in view of the
complications that might arise from separate trials and the facility with
which the whole matter may be determined by consolidating the
cases, that the trial judge might, in his discretion, pass an order
directing that the two cases be consolidated and heard together, and
in this manner have all the issues disposed of by a judgment binding
and conclusive upon all the parties before the court. In such trial the
person who filed the first application in the court of ordinary would be
entitled to open and conclude. (Roulett vs Mulherin, 100 Ga., 594.)
In probate proceeding it was a proper course to try the validity of two
alleged wills, the latest of which had been lost or destroyed at the
same time, and evidence as to the revoking clause in the lost will was
admissible, but its effect on the earlier will must be determined in view
42
of the admissibility of the latter will to probate as a will. (In

re Thompson's Estate, 1987 Pac., 795.).
Where two wills are offered for probate and applications consolidated,
submission of both for determination as to whether one, or if not that
the other, is true will, held not erroneous. (Lillard vs Tolliver, 285 S. W.,
576.).
Where two instruments are propounded by different parties as wills,
and several application are made for probate, they will be
consolidated and tried together as one proceeding. (In re Potter's Will,
155 N. Y. S., 939.).
The question of consolidation is discretionary with the court. In both of
the above-entitled proceedings, the parties are identical. No issues
have been tried in either proceeding. It therefore would be an
unnecessary expense to both the parties in interest and the country,
and an unnecessary delay in the determination of both proceedings,
not to consolidate them. I am therefore of the opinion that a
seasonable demand was made for a jury trial of the issues raised by
the objections filed to the probate of the will dated May 8, 1912, and
that the proceedings should be consolidated, and also that the issues
raised in said proceedings can be more speedily and conveniently
tried before the acting surrogate and a jury. (In re Potter's Will, 158
N.Y., 1001.)
Where separate scripts are propounded for probate as the last will
and testament of an alleged testator, the probate proceedings in a
proper case may be consolidated for trial. (In re Martin's Will, 141 N.
Y. S., 784.)
Consolidation of proceedings. At common law the court could order
all testamentary papers to be produced in court in a proceeding to
probate any one of them, and now, under the statutory procedure in
effect in the various jurisdiction, the validity of two or more papers
claimed to be the last will and testament of deceased may be tried at
the same time, or a consolidation of separate proceedings to probate
or contest various testamentary papers purported to be by the same
testator may be made. A motion for such a consolidation, however, is
addressed to the surrogate presiding at the trial and should be made
when the trial of the probate proceeding comes on for the hearing and
not prior thereto, or before the surrogate sitting for the dispatch of
chambers business. (68 C. J., 1038. 1039, sec. 830.).
The court may, in its discretion, consolidate proceedings instituted by
different persons for the purpose of having different instrument each
probated as the last will and testament of decedent. Separate
contests of a will and a codicil, or of two wills, each claimed to be the

last will of testator, may be consolidated by the court and heard
together. (Page on Wills, Page 375, paragraph 323.)
It is the conclusion of this court, therefore, that the respondent court
did not act in excess of its sound discretion in issuing the other of
March 31, 1937, and for the foregoing reasons, the remedy applied for
is hereby denied, with costs to the petitioner. So ordered.
RESOLUTION
October 13, 1937
IMPERIAL, J.:
The attorney for the petitioner seeks permission to file a second
motion for reconsideration already attached to his petition. With the
motion for reconsideration before it this court will now take up the
same for decision on its merits.
It is alleged that the interpretation of paragraph (g) of section 788 of
the Code of Civil Procedure, as amended by section 1 of Act No.
3395, was one of the questions raised by the petition for certiorari, but
that both in the decision and in the resolution of the motion for
reconsideration this court has neither given nor interpreted the
meaning and scope of the phrase "in each proceeding" appearing at
the end of the legal provision in question.
On page 2 of the decision, this court stated that the only question of
law raised by the petition was whether or not the court had acquired
jurisdiction when it provided in its orders that the counter-petition and
the second will be heard in the proceeding already instituted at the
initiative of the petitioner and that the expenses of publication of the
hearing be defrayed by the respondent. This court then said: "The
petitioner raises only one question of law, to writ: that the court
paid the fees of the clerk of court amended by Act No. 3395."
In connection with the fees of the clerk of court prescribed by section
788 (g) of the Code of Civil Procedure, as amended, this court, on
pages 6 and 7 of the decision, said: "The payment of the fees of the
43
clerk of court for all services to be rendered by him in connection with

the probate of the second will and for the successive proceedings to
be conducted and orders to be issued, in accordance with section
788, as amended, is not jurisdictional in the sense that its omission
does not deprive the court of its authority to proceed with the probate
of a will, as expressly provided for by section 630. It is the inevitable
duty of the court, when a will is presented to it, to appoint hearing for
its allowance and to cause notices the to, be given by publication. The
duty imposed said section is imperative and noncompliance therewith
would be a mockery at the law and at the last will of the Section 785
(a) of the Code of Civil Procedure, as amended recently by Act No.
3250, permits the remission or postponement of the payment of the
clerk's fees in case of poverty, at the discretion of the court, and if this
were done in one case and the payment of the fees for filing the
application were jurisdiction, as claimed, then the court, in admitting
the will to probate and in allowing it, would have acted entirely without
question but merely failed to make provision therefor."
It having been decided that the payment of said fees is not
jurisdictional, this court, in fact, determined the principal and only
question of law raised by the petition and there was no necessity of
interpreting said legal provision for the purpose of laying another
unnecessary conclusion.
In the second motion for reconsideration, however, the attorney for the
petitioner asks this court to interpret expressly the phrase "in each
proceeding" to determine whether or not the respondent was and is
obtained to pay said clerk's fees. If the interpretation asked for is to
determine the question of jurisdiction, that is, whether or not the court
acquired jurisdiction in issuing its orders appealed from, it has already
been done and it was said that the payment of said fees is not
jurisdictional. If the interpretation sought to be obtained is for the
purpose of having this court decide now whether the respondent
should, or should not, pay the clerk's fees, then this court holds that
such pronouncement is unnecessary and improper for the following
reasons: (1) Because to decide whether or not the petition is
meritorious, there is no necessity of determining whether or not the
respondent is obliged to pay the clerk's fees, and (2) because it
behooves the lower court to decide this question in the first instance
and it is improper for this appellate court to exercise the function
belonging to the former.
In view of the foregoing the second motion for reconsideration is

denied.
[G.R. No. L-41667. April 30, 1976.]
DELTA MOTOR SALES CORPORATION, Petitioner, v. HON. JUDGE
IGNACIO MANGOSING, Branch XXIV, Court of First Instance of
Manila, THE CITY SHERIFF OF MANILA, and JOSE LUIS
PAMINTUAN, Respondents.
Bonoan, Santos, Lazo & Associates for Petitioner.
Villareal, Matic & Associates for respondent Jose Luis Pamintuan.
SYNOPSIS
For failure to file its answer, petitioner was declared in default and a
default judgment was rendered a petition to lift the order of default, to
set aside the judgment and for new trial, alleging that they employee
who accepted the service summons, was not the corporate secretary
but a secretary in the Corporations personnel department and that
service upon her was a mistake. The Supreme Court held that the trial
court did not acquire jurisdiction over petitioner because it was not
properly served with summons. The service of summons on the
secretary of the personnel department who is not among the persons
mentioned in Section 13, of Rule 14, was sufficient.
SYLLABUS
1. CIVIL PROCEDURE; JURISDICTION; SUMMONS; SERVICE
UPON PRIVATE DOMESTIC CORPORATION. For the purpose of
receiving service of summons and being bound by it, a corporation is
identified with its agent or officer who under the rule is designated to
accept service of process. The corporate power to receive and act on
such service so far as to make it known to the corporation, is thus
vested in such officer or agent; and where a particular method of
serving process is pointed out by a statute, that method must be
followed, and the rule is especially exacting in reference to
corporations.
44
2. ID.; ID.; ID.; DESIGNATION OF OFFICER UPON WHOM

SERVICE MAY BE MADE EXCLUDES OTHERS. When the statute
designates a particular officer to whom the process may be delivered
and with whom it may be left, as service upon the corporation, no
other officer or person can be substituted in his place. The designation
of one officer upon whom service may be made excludes all others.
3. ID.; ID.; ID.; STRICT COMPLIANCE WITH MODE OF SERVICE
NECESSARY TO CONFER JURISDICTION OF COURT OVER A
CORPORATION. A strict compliance with the mode of service is
necessary to confer jurisdiction of the court over a corporation. The
officer upon whom service is made must be the one who is named in
they statute; otherwise the service is insufficient. The purpose is to
render it reasonably certain that the corporation will receive prompt
and proper notice in an action against it or to insure that the summons
be served on a representative so integrated with the corporation that
such person will know what to do with the legal papers served on him.
4. ID.; ID.; ID.; CONSTRUCTION AND INTERPRETATION. The
liberal construction rule cannot be invoked and utilized as substitute
for the plain legal requirements as to the manner in which summons
should be served on a domestic corporation.
5. ID.; ID.; ID.; SERVICE SUMMONS ON PERSONS NOT
MENTIONED IN THE RULES IS INSUFFICIENT. The court does
not acquire jurisdiction over defendant corporation where it is not
properly served with summons. Service of summons on a secretary of
the corporations personnel department, who is not among the
persons mentioned in Section 13 of Rule 14, is insufficient. It does not
bind the corporation.
6. ID.; ID.; ID.; JURISDICTION, HOW ACQUIRED. Court acquires
jurisdiction over the person of a party defendant and of the subject
matter of the action of the virtue of the service summons in the
manner required by law. Where there is no service of summons or a
voluntary general appearance by the defendant the court acquires no
jurisdiction to pronounce a judgment in the cause.
DECISION
AQUINO, J.:
Delta Motor Sales Corporation (Delta Motor for short) in this special
civil action of certiorari seeks to annul certain orders of the Court of
First Instance of Manila denying its motion to set aside the order of
default and the judgment by default in Civil Case No. 97373 and
granting the motion for execution of Jose Luis Pamintuan. The facts
are as follows:chanrob1es virtual 1aw library
On April 16, 1975 Pamintuan sued Delta Motor for the recovery of the
sum of P58,000 as damages and attorneys fees. The basis of the
action was that Delta Motor, as the seller of an allegedly defective
Toyota car to Pamintuan for the sum of P33,950, failed to fulfill its
warranty obligation by not properly repairing the car.
The summons for Delta Motor was served on April 9 on its employee,
Dionisia G. Miranda, who acknowledged its receipt by signing on the
lower portion of the original summons.
Delta Motor did not answer the complaint within the reglementary
period which expired on May 4. On May 27 Pamintuan filed a motion
to declare Delta Motor in default. A copy of the motion was furnished
Delta Motor. The Manila court granted the motion in its order of June
3.
In its decision dated June 16, 1975 the lower court found that
Pamintuan bought from Delta Motor on June 20, 1974 a Toyota car;
that the leaks emanating from its windshield, doors and windows were
not stopped by Delta Motor, and that in consequence of its breach of
warranty Delta Motor should pay Pamintuan P45,000 as damages.
That decision was served on Delta Motor on June 27. On July 21, its
lawyers filed a petition to lift the order of default, to set aside the
judgment and for new trial. Delta Motor alleged that Dionisia G.
Miranda, who accepted the service of summons, was not the
corporate secretary but the secretary of Alberto Ramos of the
personnel department who was on sick leave and that service upon
her was a mistake; that Pamintuan is still indebted to Delta Motor for
45
the unpaid balance of the price in the sum of P25,000; that the entity
liable for breach of warranty was Toyota Motor Sales Company, and
that Delta Motor has good defenses to the action.
The motion was supported by the affidavit of Dionisia G. Miranda who
alleged that, as there was no instruction from the sheriff that the
summons and complaint should be delivered to the officers of Delta
Motor, she just kept the same "for reference" to her immediate
superior, Ramos, who, however, seldom went to office. Geldino S.
Santos, the administrative officer of Delta Motor, in his affidavit, also
attached to the motion, confirmed that Dionisia G. Miranda was
Ramos secretary.
The lower court denied the motion in its order of July 29 on the ground
that Dionisia G. Miranda was a person of suitable age and discretion
who could receive summons for another person, as contemplated in
section 8, Rule 14 of the Revised Rules of Court, and that although
Delta Motors legal department was served on May 27 with a copy of
the motion to declare it in default, it did not oppose the motion.
The order of denial was received by Delta Motors counsel on August
4. It filed a motion for reconsideration at ten minutes before five
oclock in the afternoon of the thirtieth day, August 8. The lower court
denied it in its order of August 25. That order of denial was received
by Delta Motors counsel on September 4.
On the following day, September 5, Delta Motor deposited P120 as
appeal bond and filed a notice of appeal and record on appeal.
Pamintuan countered with a motion for execution. He contended that
the judgment was already final because Delta Motors motion for
reconsideration was filed after four-thirty in the afternoon of the
thirtieth day or after the close of office hours.
The Manila court in its order of October 13 refused to give due course
to Delta Motors appeal and granted Pamintuans motion for
execution. The instant petition was filed on October 20, 1975. The
sheriff levied upon a Toyota mini-bus and a car to satisfy the judgment
for damages against Delta Motor.
Pamintuan in his comment on the petition revealed that on May 27,
1975, when Delta Motor was furnished with a copy of the motion to
declare it in default, it sued Pamintuan in the Court of First Instance of
Rizal, Pasig Branch XIII for the rescission of the sale and the recovery
of the car (Civil Case No. 21303). A writ of replevin was issued in that
case. A deputy sheriff of Rizal seized from Pamintuan the Toyota car
on June 6, 1975.
Pamintuan filed a motion to dismiss Delta Motors complaint in the
Pasig court on the ground of the pendency in the Manila court of Civil
Case No. 97373 involving the same Toyota car. Delta Motor opposed
it. It was denied.
Pamintuan filed in the Court of Appeals a petition for certiorari in order
to set aside the Pasig courts order denying his motion to dismiss
(Pamintuan v. Revilla, CA-G.R No. SP-04743). The Court of Appeals
in its decision dated February 16, 1976 denied the petition. It held that
the Rizal court did not commit any grave abuse of discretion in not
dismissing Delta Motors action.
The issue in this case is whether Delta Motor was properly served
with summons or whether the Manila court had jurisdiction to render
the judgment by default against it and to execute that judgment.
Rule 14 of the Revised Rules of Court
provides:jgc:chanrobles.com.ph
"SEC. 13. Service upon private domestic corporation or partnership.
If the defendant is a corporation organized under the laws of the
Philippines or a partnership duly registered, service may be made on
the president, manager, secretary, cashier, agent, or any of its
directors."cralaw virtua1aw library
For the purpose of receiving service of summons and being bound by
it, a corporation is identified with its agent or officer who under the rule
is designated to accept service of process. "The corporate power to
receive and act on such service, so far as to make it known to the
corporation, is thus vested in such officer or agent." (Lafayette
Insurance Co. v. French, 15 L. Ed. 451, 453).
As noted by the Federal Supreme Court, "the cases are numerous
which decide that where a particular method of serving process is
46
pointed out by statute, that method must be followed, and the rule is
especially exacting in reference to corporations" (Amy v. City of
Watertown, 32 L. Ed. 946). .
The Amy case cited the ruling in Watertown v. Robinson, 69 Wis. 230
that the particular mode of service indicated in the statute should be
followed because ita lex scripta est. "There is no chance to speculate
whether some other mode will not answer as well. This has been too
often held by this court to require further citations. When the statute
designates a particular officer to whom the process may be delivered
and with whom it may be left, as service upon the corporation, no
other officer or person can be substituted in his place. The designation
of one particular officer upon whom service may be made excludes all
others." (Page 952).
A strict compliance with the mode of service is necessary to confer
jurisdiction of the court over a corporation. The officer upon whom
service is made must be one who is named in the statute; otherwise
the service is insufficient. So, where the statute requires that in the
case of a domestic corporation summons should be served on "the
president or head of the corporation, secretary, treasurer, cashier or
managing agent thereof", service of summons on the secretarys wife
did not confer jurisdiction over the corporation in the foreclosure
proceeding against it. Hence, the decree of foreclosure and the
deficiency judgment were void and should be vacated. (Reader v.
District Court, 94 Pacific 2nd 858).
The purpose is to render it reasonably certain that the corporation will
receive prompt and proper notice in an action against it or to insure
that the summons be served on a representative so integrated with
the corporation that such person will know what to do with the legal
papers served on him. In other words, "to bring home to the
corporation notice of the filing of the action." (35A C.J.S. 288 citing
Jenkins v. Lykes Bros. S.S. Co., 48 F. Supp. 848; McCarthy v.
Langston, D.C. Fla., 23 F.R.D. 249).
The liberal construction rule cannot be invoked and utilized as a
substitute for the plain legal requirements as to the manner in which
summons should be served on a domestic corporation (U.S. v.
Mollenhauer Laboratories, Inc., 267 Fed. Rep. 2nd 260).
In the instant case the Manila court did not acquire jurisdiction over
Delta Motor because it was not properly served with summons. The
service of summons on Dionisia G. Miranda, who is not among the
persons mentioned in section 13 of Rule 14, was insufficient. It did not
bind the Delta Motor.
"Courts acquire jurisdiction over the person of a party defendant and
of the subject-matter of the action by virtue of the service of summons
in the manner required by law. Where there is no service of summons
or a voluntary general appearance by the defendant, the court
acquires no jurisdiction to pronounce a judgment in the cause."
(Syllabi, Salmon and Pacific Commercial Co. v. Tan Cueco, 36 Phil.
556).
Consequently, the order of default, the judgment by default and the
execution in Civil Case No. 97373 are void and should be set aside.
It appears that Civil Case No. 21303 filed by Delta Motor against
Pamintuan in the Pasig court, which is in effect a counter-claim to the
Manila case, deals with the same sale of the Toyota car which is
involved in Civil Case No. 97373 of the Manila court.
In the interest of justice and to avoid conflicting decisions, the trial of
the two cases should be consolidated. The Pasig case should be
transferred to Branch XXIV of the Court of First Instance of Manila
where Civil Case No. 97373 is assigned. Apparently, Delta Motor filed
its replevin case in Pasig because it was stipulated in the invoice
covering the sale that any action thereunder may be instituted in any
competent court of Rizal.
WHEREFORE, the order of default, judgment by default and the other
proceedings in Civil Case No. 97373 are set aside. The lower court is
directed to admit the answer of Delta Motor.
Respondent Pamintuan may likewise file his answer in Civil Case No.
21303. The record of that case should be transferred to the Court of
First Instance of Manila as indicated above.
If the parties do not come to any amicable settlement during the pretrial of the two cases, then further proceedings may be had for the
adjudication of the said cases. No costs.
47
liable to incur in connection with the Gumaca case.

SO ORDERED.
Concepcion, Jr., concur.
Fernando, C.J., in the result.
[G.R. No. L-64250. September 30, 1983.]
SUPERLINES TRANSPORTATION CO., INC. and ERLITO
LORCA, Petitioners, v. HON. LUIS L. VICTOR, Judge Presiding over
Branch XVI of the Regional Trial Court of Cavite, TIMOTEA T.
MORALDE, CAYETANO T. MORALDE, JR., ALEXANDER T.
MORALDE, EMMANUEL T. MORALDE, and JOCELYN MORALDE
ABELLANA, Respondents.
Benito P. Fabio for Plaintiff-Appellee.
Michael Moralde for Private Respondents.
SYLLABUS
1. REMEDIAL LAW; ACTIONS; JUDICIAL ECONOMY AND
ADMINISTRATION AS WELL AS CONVENIENCE OF THE PARTIES;
CONSIDERATIONS FOR CONSOLIDATION OF CASES IN THE
CASE AT BAR. There is, however, a more pragmatic solution to the
cotroversy at bar; and that is to consolidate the Gumaca case with the
Cavite case. Considerations of judicial economy and administration,
as well as the convenience of the parties for which the rules on
procedure and venue were formulated, dictate that it is the Cavite
court, rather than the Gumaca court, which serves as the more
suitable forum for the determination of the rights and obligations of the
parties concerned. As observed by both the trial and appellate courts,
to require private respondents who are all residents of Kawit, Cavite,
to litigate their claims in the Quezon Court would unnecessarily
expose them to considerable expenses. On the other hand, no like
prejudice would befall the defendants transportation companies if they
were required to plead their causes in Cavite, for such change of
venue would not expose them to expenses which are not already
2. ID.; PURPOSE AND OBJECT OF PROCEDURE. The whole

purpose and object of procedure is to make the powers of the court
fully and completely available for justice. The most perfect procedure
that can be devised is that which gives opportunity for the most
complete and perfect exercise of the powers of the court within the
limitations set by natural justice. It is that one which, in other words,
gives the most perfect opportunity for the powers of the count to
transmute themselves into concrete acts of justice between the
parties before it. The purpose of such a procedure is not to restrict the
jurisdiction of the court over the subject matter, but to give it effective
facility in righteous action. The purpose of procedure is not to thwart
justice. Its proper aim is to facilitate the application of justice to the
rival claims of contending parties. It was created not to hinder and
delay but to facilitate and promote the administration of justice. It does
not constitute the thing itself which courts are always striving to
secure to litigants. It is designed as the means best adapted to obtain
that thing. In other words, it is a means to an end. It is the means by
which the powers of the court are made effective in just judgments.
When it loses the character of the one and takes on that of the other
the administration of justice becomes incomplete and unsatisfactory
and lays itself open to grave criticism." (Manila Railroad Co. v.
Attorney-General, 20 Phil. 523)
DECISION
ESCOLIN, J.:
A petition for certiorari to set aside the decision of the Intermediate
Appellate Court in CA-G.R. No. SP-00708 entitled "Superlines
Transportation Co., Inc., Et. Al. versus Hon. Luis L. Victor, Et Al.,"
which affirmed the orders dated March 28 and April 27, 1983 of herein
respondent Judge Luis L. Victor in Civil Case No. N-4338 of the
Regional Trial Court of Cavite, entitled "Timotea T. Moralde, Et. Al.
versus Pantranco South Express, Inc., Et. Al."cralaw virtua1aw library
On December 19, 1982, Bus No. 3008 of the Pantranco South
48
Express, Inc., Pantranco for short, driven by Rogelio Dillomas,

collided with Bus No. 331 of the Superlines Transportation Co., Inc.,
Superlines for short, then driven by Erlito Lorca along the highway at
Lumilang, Calauag, Quezon, resulting in the instantaneous death of
Cayetano P. Moralde, Sr., a passenger in the Pantranco
bus.cralawnad
On January 4, 1983, Superlines instituted an action for damages
before the then Court of First Instance of Quezon, Gumaca Branch,
against Pantranco and Rogelio Dillomas, driver of said Pantranco Bus
No. 3008. In its complaint, docketed as Civil Case No. 1671-G,
Superlines alleged that the recklessness and negligence of the
Pantranco bus driver was the proximate cause of the accident and
that there was want of diligence on the part of Pantranco in the
selection and supervision of its driver.
On February 11, 1983, private respondents Timotea T. Moralde,
widow of the deceased Cayetano P. Moralde, Sr., and her children,
Cayetano, Jr., Alexander, Ramon, Emmanuel, all surnamed Moralde,
and Jocelyn M. Abellana, filed a complaint for damages, docketed as
Civil Case No. N-4338 of the Regional Trial Court of Cavite City,
against Superlines and its driver, Erlito Lorca, as well as Pantranco
and its driver, Rogelio Dillomas. The cause of action pleaded against
Superlines was based on quasi-delict, while that against Pantranco,
on culpa-contractual.
On February 28, 1983, herein petitioners Superlines and its driver
Erlito Lorca filed a motion to dismiss in Civil Case No. N-4338 on the
ground of pendency of another action, obviously referring to Civil
Case No. 1671-G pending before the Regional Trial Court of Quezon,
Gumaca Branch.
Finding that the two cases (Civil Cases No. 1671-G and No. N-4338)
involved different parties as well as different causes of action,
respondent Judge Luis Victor denied the motion to dismiss in the
challenged order of March 28, 1983. Superlines moved for a
reconsideration, but the same was denied on April 27, 1983.
Dissatisfied, Superlines filed with the Intermediate Appellate Court a
petition for certiorari and prohibition with preliminary injunction, which
petition, however, was denied due course. Hence, this present
recourse.
It is suggested by petitioners that private respondents Moraldes
should pursue their claim for damages by intervening in the Gumaca
action, pursuant to Sec. 2, Rule 12 of the Rules of Court and in the
light of Municipality of Hagonoy v. Secretary of Agriculture and Natural
Resources [73 SCRA 507] and Orellano v. Alvestir [76 SCRA 536]. It
is contended that since the right of private respondents to claim
damages is founded on the same facts involved in the Gumaca
action, any judgment rendered therein will amount to res judicata in
the Cavite case, for whatever adjudication is made in the former case
between Pantranco and Superlines as regards either of the parties
culpability would set said issue at rest. Furthermore, such intervention
would prevent multiplicity of suits and avoid confusion that may arise
should the trial courts render conflicting
decisions.chanroblesvirtualawlibrary
Petitioners stand is consistent with our ruling in the case of Marapao
v. Mendoza, 119 SCRA 97, where We held that:jgc:chanrobles.com.ph
"While respondent Castillo has not been impleaded in the Bohol case,
she has similar interests as Hotel de Mercedes, the defendant therein
which is her employer. Petitioner and private respondent both claim
damages based on the same incident. A decision, whether in favor of
petitioner or private respondent in the Bohol case would amount to res
judicata in the Cebu case. Damages in favor of one party would
preclude damages in favor of the other.
"There is an additional reason for dismissal and that is, to avoid
multiplicity of suits. (Ago Timber Co. v. Hon. Ruiz, Et Al., 21 SCRA 138
(1967); Erlanger v. Villamor, 98 Phil. 1003 (1956); Teodoro, Jr. v.
Mirasol, 99 Phil. 150 (1956).
"To protect the interests of respondent employee, she may intervene
as a party in the Bohol case and file a counterclaim for damages
against petitioner."cralaw virtua1aw library
There is, however, a more pragmatic solution to the controversy at
bar; and that is to consolidate the Gumaca case with the Cavite case.
Considerations of judicial economy and administration, as well as the
convenience of the parties for which the rules on procedure and
49
venue were formulated, dictate that it is the Cavite court, rather than
the Gumaca court, which serves as the more suitable forum for the
determination of the rights and obligations of the parties concerned.
As observed by both the trial and appellate courts, to require private
respondents who are all residents of Kawit, Cavite, to litigate their
claims in the Quezon Court would unnecessarily expose them to
considerable expenses. On the other hand, no like prejudice would
befall the defendants transportation companies if they were required
to plead their causes in Cavite, for such change of venue would not
expose them to expenses which they are not already liable to incur in
connection with the Gumaca case. The objection interposed by
Superlines that it has its offices in Atimonan, Quezon, should not
detract from the overall convenience afforded by the consolidation of
cases in the Cavite Court. For apart from the fact that petitioner and
its driver are represented by the same counsel with offices located in
Manila, defendants transportation companies can readily avail of their
facilities for conveying their witnesses to the place of trial.chanrobles
virtual lawlibrary
The ordered consolidation of cases, to our mind, crystallizes into
reality the thinking of our predecessors that:jgc:chanrobles.com.ph
". . . The whole purpose and object of procedure is to make the
powers of the court fully and completely available for justice. The most
perfect procedure that can be devised is that which gives opportunity
for the most complete and perfect exercise of the powers of the court
within the limitations set by natural justice. It is that one which, in other
words, gives the most perfect opportunity for the powers of the court
to transmute themselves into concrete acts of justice between the
parties before it. The purpose of such a procedure is not to restrict the
jurisdiction of the court over the subject matter, but to give it effective
facility in righteous action. It may be said in passing that the most
salient objection which can be urged against procedure today is that it
so restricts the exercise of the courts powers by technicalities that
part of its authority effective for justice between the parties is many
times an inconsiderable portion of the whole. The purpose of
procedure is not to thwart justice. Its proper aim is to facilitate the
application of justice to the rival claims of contending parties. It was
created not to hinder and delay but to facilitate and promote the
administration of justice. It does not constitute the thing itself which
courts are always striving to secure to litigants. It is designed as the

means best adapted to obtain that thing. In other words, it is a means
to an end. It is the means by which the powers of the court are made
effective in just judgments. When it loses the character of the one and
takes on that of the other the administration of justice becomes
incomplete and unsatisfactory and lays itself open to grave criticism."
(Manila Railroad Co. v. Attorney-General, 20 Phil. 523)
WHEREFORE, the instant petition is hereby denied. Civil Case No.
1671-G of the Regional Trial Court of Quezon is hereby ordered
consolidated with Civil Case No. N-4338 pending before the Regional
Trial Court of Cavite. The Regional Trial Court of Quezon, Gumaca
Branch, is directed to transfer, without unnecessary delay, the records
of Civil Case No. 1671-G to the Regional Court of Cavite, Branch XVI.
SO ORDERED.
Makasiar (Chairman), Aquino, Guerrero, Abad Santos and
Relova, JJ., concur.
G.R. No. 190462 : November 17, 2010
STEEL CORPORATION OF THE PHILIPPINES, Petitioner,
v. EQUITABLE PCI BANK, INC., (now known as BDO UNIBANK,
INC.), Respondent.
G.R. No. 190538 : November 17, 2010
DEG DEUTSCHE INVESTITIONS-UND
ENTWICKLUNGSGESELLSCHAFT MBH,Petitioner, v. EQUITABLE
PCI BANK, INC., (now known as BDO UNIBANK, INC.) and STEEL
CORPORATION OF THE PHILIPPINES, Respondents.
DECISION
VELASCO, JR., J.:
Before us are two Petitions for Review on Certiorari under Rule 45,
docketed as G.R. Nos. 190462 and 190538, assailing the July 3, 2008
Decision[1] and December 3, 2009 Resolution[2] of the Court of
Appeals (CA) in CA-G.R. SP No. 101881, entitled Equitable PCI Bank,
Inc. (now known as Banco de Oro-EPCI, Inc.) v. Steel Corporation of
the Philippines. The CA set aside the Decision[3] dated December 3,
2007 of the Regional Trial Court (RTC) acting as a Rehabilitation
Court, and, in effect, the CA (1) set aside the Rehabilitation Courts
50
Decision approving the Rehabilitation Plan; and (2) terminated the

corporate rehabilitation of Steel Corporation of the Philippines
(SCP). cra
We consolidated G.R. No. 190462 with G.R. No. 190538 as they
involve identical parties, arose from the same facts, and assail the
same CA Decision dated July 3, 2008.[4]cralaw
The Facts
SCP is a domestic corporation incorporated and registered with the
Securities and Exchange Commission on October 3, 1994. It is
engaged in the manufacturing and distribution of cold-rolled and
galvanized steel sheets and coils.
During its operations, SCP encountered and suffered from financial
difficulties and temporary illiquidity, aggravated by the 1997 Asian
Financial Crisis. And shortage in working capital and reduced
operating capacity compounded its problem. As a result, SCP was
unable to service its principal payments for its liabilities.
In its Interim Financial Statement as of December 31, 2005, SCPs
total assets amounted to PhP 10,996,551,123, while its liabilities
amounted to PhP 8,365,079,864.
Accordingly, on September 11, 2006, Equitable PCI Bank, Inc., now
known as Banco de Oro-EPCI, Inc. (BDO-EPCIB), which accounted
for 27.45% of the total liabilities of SCP, filed a creditor-initiated
petitionto place the SCP under corporate rehabilitation pursuant to
the provisions of Section 1, Rule 4 of the Interim Rules of Procedure
on Corporate Rehabilitationentitled In the Matter of the Petition to
have Steel Corporation of the Philippines Placed under Corporate
Rehabilitation with Prayer for the Approval of the Proposed
Rehabilitation Plan. BDO-EPCIB included its proposed rehabilitation
plan in the said petition.
Finding the petition to be sufficient in form and substance, the
Rehabilitation Court issued an Order dated September 12, 2006,
directing, among others, the stay of enforcement of all claims, whether
for money or otherwise and whether such enforcement is by court
action or otherwise, against SCP, its guarantors, and sureties not
solidarily liable with it. The Rehabilitation Court likewise appointed
Atty. Santiago T. Gabionza, Jr. as the Rehabilitation Receiver for SCP.
SCP did not oppose the petition but instead filed its own counter
rehabilitation plan and submitted it for the consideration of the
Rehabilitation Court. Other creditors filed their respective comments
on the petition.
On November 23, 2006, the Rehabilitation Court issued an Order,

giving due course to the petition and directing Atty. Gabionza to
evaluate the rehabilitation plan proposed by BDO-EPCIB and the
proposals of the other participating creditors, and to submit his
recommendations. The Rehabilitation Court also directed Atty.
Gabionza to consider SCPs counter rehabilitation plan in drafting his
recommended rehabilitation plan.
In a Compliance dated March 6, 2007, Atty. Gabionza submitted his
recommended rehabilitation plan. The said plan contained the salient
features of the rehabilitation plans separately submitted by SCP and
BDO-EPCIB, as well as his own comments. The plan was
summarized by the Rehabilitation Court as
follows:chanroblesvirtuallawlibrary
Thus, after considering the comments of the other participating
creditors and evaluating the proposals of SCP and the Petitioner, Atty.
Gabionza recommended the following terms and conditions for
rehabilitation plan, to wit:chanroblesvirtuallawlibrary
1. Fresh equity infusion of P3.5 Billion, out of which P3 Billion shall be
used for debt reduction, and the balance of P500 Million as additional
working capital.
2. The P3 Billion allocated for debt repayment shall first service the
secured credits and excess thereafter will be applied to clean
creditors and suppliers.
3. The remaining short term and long term debt balances after debt
reduction will be restructured over a period of 12 years inclusive of a 2
year grace period on principal payments. There shall be 20 equal
semi-annual payments of principal to commence at the end of the
grace period.
4. Interest rates for the restructure debt shall be 8% per annum fixed
for the duration of the loan and shall be payable quarterly in arrears.
No grace period on interest payments.
5. To protect existing clean creditors, SCP may not secure additional
secured credits which will utilize the excess assets values after the
P3.0 Billion debt reduction.
6. Any excess cash after the annual (normal) CAPEX and debt service
requirements shall be distributed as follows: 70% debt repayment and
30% to be retained by the Company.
7. All existing suppliers credits (subject to final validation) shall have 2
options:chanroblesvirtuallawlibrary
a. To be paid quarterly over a period of 5 years without interest, or
51
b. To continuously supply the company on the pay-re-avail (Deliver

same amount paid) basis.
8. All loans, suppliers credit and other SCP liabilities are subject to
final verification once the recommended rehabilitation plan is
approved.
The rehabilitation plan recommended by Atty. Gabionza has three (3)
phases in the implementation of the proposed P3.5 Billion fresh equity
infusion, thus:chanroblesvirtuallawlibrary
Phase 1
SCPs articles of incorporation and by laws shall be amended to
accommodate the additional equity of P3.5 Billion. The present
stockholders of SCP shall be given sixty (60) days from approval of
the plan to keep their stockholdings SCP by raising/sourcing the P3.5
Billion fresh equity required.
Phase 2
In the event the present stockholders fail to raise the P3.5 Billion fresh
equity needed to keep their stockholdings and save their company,
Atty. Gabionza shall offer to acceptable investors, through negotiated
sale or bidding, 67% of SCP for the P3.5 Billion fresh equity required.
Phase 3
Should Phase 1 and 2 fail, there shall be a debt to equity conversion
in the required amount of P3.5 Billion.[5]cralaw
Although not required by the rules, several consultative meetings
were thereafter conducted by the Rehabilitation Court between and
among the parties to discuss a viable rehabilitation plan for SCP that
is acceptable to all.
In compliance with the directives of the Rehabilitation Court to
consider all the inputs and observations made by the parties during
the consultative meetings and to make the necessary modification in
his recommendations on the submitted rehabilitation plans, Atty.
Gabionza submitted a Modified Rehabilitation Plan as incorporated in
his compliance dated June 27, 2007. The modifications made
were:chanroblesvirtuallawlibrary
Phase 1 of the Recommended Rehabilitation Plan is retained under
the Modified Rehabilitation Plan. Phase 2, however, is amended to the
effect that in the event the present stockholders fail to raise the P3.5
Billion fresh equity needed to keep their stockholdings and save their
company, the same existing stockholders of SCP shall be afforded a
period of 60 days from the expiration of the period provided in Phase
1 to offer for sale to an acceptable investor at least 67% stockholdings
in SCP for an amount not less than P3.5 Billion.
Under Phase 3 thereof, there shall be a debt to equity conversion in

the required amount of P3.5 Billion should Phase 1 and 2 fail. The
adjusted book value of SCP under its 2005 Audited Financial
Statements is pegged at P1.129 Billion. Accordingly, P1.1.29 Billion of
the existing debt will initially be converted into common shares
achieving an ownership structure where both existing stockholders
and the bank creditors will equally own SCP at 50% each. The
balance of P2.371 Billion will then be converted into non-interest
bearing convertible notes.[6]cralaw
On June 21, 2007, BDO-EPCIB, joined by creditors DEG, Planters
Development Bank, China Banking Corporation, Asiatrust
Development Bank and GE Money Bank, Inc., altogether holding
more than 50% of SCPs total liabilities, filed their Joint Manifestation
and Motion declaring their conformity with and support to Atty.
Gabionzas Recommended Rehabilitation Plan.
On July 30, 2007, SCP submitted its 2006 Audited Financial
Statements in a Compliance with Motion. Atty. Gabionza was ordered
by the Rehabilitation Court to study the financial statements and to
submit a report on their effects on the Modified Rehabilitation Plan.
The parties then submitted their respective comments on the Modified
Rehabilitation Plan and Atty. Gabionzas report on the effects of the
2006 Audited Financial Statements. Likewise, SCP submitted its
Updated Counter Rehabilitation Plan, attached to its Ad Abundante
Cautelam Motion to Admit Debtor SCPs Updated Counter
Rehabilitation Plan, which was subsequently admitted by the
Rehabilitation Court.
On December 3, 2007, the RTC promulgated a Decision approving
the Modified Rehabilitation Plan. The dispositive portion
reads:chanroblesvirtuallawlibrary
WHEREFORE, premises considered, the present petition is given due
course. The parties are mandated to comply strictly with the
provisions of the approved rehabilitation plan.
The Rehabilitation Receiver is hereby directed to provide this Court
with periodic reports on the implementation of the approved
Rehabilitation Plan.
The provisions of the approved Rehabilitation Plan shall be binding on
all persons and parties affected by it, whether or not such persons or
parties have participated in the present proceedings.
The concerned parties are further directed to submit to this Court their
respective nominees for the Management Committee not later than 60
days before the expiration of the period for the application of Phases 1
52
and 2 of the foregoing rehabilitation plan. In case no nominee is

submitted by any party, this Court shall directly designate the
corresponding members thereof.
SO ORDERED.[7]cralaw
Therefrom, several creditors went to the CA via separate Petitions for
Review onCertiorari, to wit: (1) SCPs petition dated January 9, 2008,
docketed as CA-G.R. SP No. 101732 and entitled Steel Corporation of
the Philippines v. Equitable PCI Bank, Inc.; (2) DEGs petition dated
January 6, 2008, docketed as CA-G.R. SP No. 101880 and entitled
DEG Deutsche Investitions-und Entwicklungsgesselschaft mbH v.
Steel Corporation of the Philippines; (3) BDO-EPCIBs petition dated
Equitable PCI Bank, Inc. v. Steel Corporation of the Philippines; and
(4) Investments 2234 Philippines Fund I, Inc.s (IPFIs) petition dated
Investments 2234 Philippines Fund I (SPV-AMC), Inc. v. Equitable PCI
Bank, Inc.
The petitions of SCP and IPFI were eventually consolidated under
CA-G.R. SP No. 101732. However, the CA denied BDO-EPCIBs
motion to consolidate with CA-G.R. SP No. 101732.[8] As to CA-G.R.
SP No. 101881, the Court takes judicial notice of the fact that it has
also been consolidated with CA-G.R. SP No. 101732 in a Resolution
issued by the CA dated March 22, 2010.
On July 3, 2008, the CA issued the assailed decision in CA-G.R. SP
No. 101881, ordering the termination of the rehabilitation proceedings.
The dispositive portion reads:chanroblesvirtuallawlibrary
WHEREFORE, premises considered, the Decision dated December
3, 2007 of the RTC, Branch II, Batangas City, in SP No. 06-7993 is
hereby SET ASIDE, and another one is hereby entered declaring the
rehabilitation proceedings TERMINATED, pursuant to Section 27,
Rule 4 of the Interim Rules of Procedure on Corporate Rehabilitation.
SO ORDERED.[9]cralaw
SCP then filed a Supplemental Petition for Review dated July 21,
2008 in CA-G.R. SP No. 101732, praying, among others, for the
approval of its Revised Updated Counter Rehabilitation Plan.
From the July 3, 2008 CA Decision, DEG, SCP, Landmark Glory
Limited, and Liquigaz Philippines Corporation interposed separate
motions for reconsideration. However, on December 3, 2009, the CA
denied all motions for reconsiderations.
Hence, these separate recourses are before us.
The Issues
In G.R. No. 190462, SCP raised the following arguments in support of

its amended petition:chanroblesvirtuallawlibrary
I.
The [CA] erred when it did, it denied the petitioner its rights to both
procedural and substantive due process when
(a) It did not follow its own internal rules of procedure and thereafter
justified its error on the bases of misleading and false statements;
(b) It granted a relief which none of the parties sought for, nor were
heard, nor given the opportunity to be heard, thereon, and
(c) It substituted its judgment for that of the rehabilitation court,
usurping in the process the exclusive authority reposed in the said
court.
II.
The [CA] erred and when it did, it acted in a manner at war with
orderly procedure when it declared the termination of the
proceedings without passing upon nor giving the petitioner a chance
to be heard on the updated alternative rehabilitation plan submitted by
it.
III.
The [CA] erred and when it did, it failed to perform its duties and
obligations as a court when it found, and thereafter declared
termination of the rehabilitation proceedings because the case had
become litigious and did not try to allow the parties to adjust their
differences so that rehabilitation of the petitioner could go on.
[10]cralaw
In G.R. No. 190538, DEG submits as
follows:chanroblesvirtuallawlibrary
I.
The [CA] had no jurisdiction or authority to terminate the rehabilitation
proceedings.
II.
Assuming, arguendo, that the [CA] had the authority to terminate the
rehabilitation proceedings, such termination was premature.[11]cralaw
The issues raised before the Court can be summarized into
two:chanroblesvirtuallawlibrary
(1) Whether or not the CA erred in refusing to consolidate the cases
pending before it; and
(2) Whether or not the CA erred in granting a relief that was not
prayed for by the parties, i.e., the termination of the rehabilitation
proceedings.
Consolidation of Cases is Proper
53
Petitioner SCP argues that the CA deviated from its own Internal
Rules when it failed to consolidate the four (4) appeals arising from
the same decision of the rehabilitation court. In fact, it points out to the
fact that CA-G.R. SP No. 101913 had already been consolidated with
its own appeal in CA-G.R. SP No. 101732. However, SCP says that
the failure by the CA to consolidate the remaining two appeals,
namely CA-G.R. SP Nos. 101880 and 101881, with its own appeal
indicates not only a deviation from the rules but also a disobedience
to their plain language and obvious intent.
On the other hand, BDO-EPCIB refutes SCPs arguments by saying
that the consolidation of cases is only discretionary, not mandatory,
upon the court.
The Court agrees with SCP.
Consolidation of actions is expressly authorized under Sec. 1, Rule 31
of the Rules of Court:chanroblesvirtuallawlibrary
Section 1. Consolidation. When actions involving a common
question of law or fact are pending before the court, it may order a
joint hearing or trial of any or all the matters in issue in the actions; it
may order all the actions consolidated; and it may make such orders
concerning proceedings therein as may tend to avoid unnecessary
costs or delay.
Likewise, Rule 3, Sec. 3 of the 2002 Internal Rules of the CA[12]
adopts the same rule:chanroblesvirtuallawlibrary
Sec. 3. Consolidation of Cases. When related cases are assigned to
different Justices, they may be consolidated and assigned to one
Justice.
(a) At the instance of a party with notice to the other party; or at the
instance of the Justice to whom the case is assigned, and with the
conformity of the Justice to whom the cases shall be consolidated,
upon notice to the parties, consolidation may be allowed when the
cases involve the same parties and/or related questions of fact and/or
law.
(b) Consolidated cases shall pertain to the Justice
(1) To whom the case with the lowest docket number is assigned, if
they are of the same kind;
(2) To whom the criminal case with the lowest number is assigned, if
two or more of the cases are criminal and the others are civil or
special;
(3) To whom the criminal case is assigned and the other are civil or
special; and
(4) To whom the civil case is assigned, or to whom the civil case with
the lowest docket number is assigned, if the cases involved are civil
and special.
(c) Notice of the consolidation and replacement shall be given to the
Raffle Staff and the Judicial Records Division.
It is a time-honored principle that when two or more cases involve the
same parties and affect closely related subject matters, they must be
consolidated and jointly tried, in order to serve the best interests of the
parties and to settle expeditiously the issues involved.[13] In other
words, consolidation is proper wherever the subject matter involved
and relief demanded in the different suits make it expedient for the
court to determine all of the issues involved and adjudicate the rights
of the parties by hearing the suits together.[14]cralaw
The purpose of this rule is to avoid multiplicity of suits, guard against
oppression and abuse, prevent delays, clear congested dockets, and
simplify the work of the trial court. In short, consolidation aims to attain
justice with the least expense and vexation to the parties-litigants.[15]
It contributes to the swift dispensation of justice, and is in accord with
the aim of affording the parties a just, speedy, and inexpensive
determination of their cases before the courts. Further, it results in the
avoidance of the possibility of conflicting decisions being rendered by
the courts in two or more cases, which would otherwise require a
single judgment.[16]cralaw
In the instant case, all four (4) cases involve identical parties, subject
matter, and issues. In fact, all four (4) arose from the same decision
rendered by the Rehabilitation Court. As such, it became imperative
upon the CA to consolidate the cases. Even though consolidation of
actions is addressed to the sound discretion of the court and normally,
its action in consolidating will not be disturbed in the absence of
manifest abuse of discretion,[17] in this instance, we find that the CA
gravely erred in failing to order the consolidation of the cases.
By refusing to consolidate the cases, the CA, in effect, dispensed a
form of piecemeal judgment that has veritably resulted in the
multiplicity of suits. Such action is not regarded with favor, because
consolidation should always be ordered whenever it is possible.
Relief Is Limited Only to Issues Raised
SCP further contends that the CA denied it its right to procedural and
substantive due process, because it granted a relief entirely different
from those sought for by the parties and on which they were neither
heard nor given the opportunity to be heard.
54
Respondent BDO-EPCIB, on the other hand, maintains that the CA

has the power to grant such other appropriate relief as may be
consistent with the allegations and proofs when a prayer for general
relief is added to the demand of specific relief.[18]cralaw
SCPs contention deserves merit.
Sec. 8, Rule 51 of the 1997 Rules of Civil Procedure expressly
provides:chanroblesvirtuallawlibrary
SEC. 8. Questions that may be decided. No error which does not
affect the jurisdiction over the subject matter or the validity of the
judgment appealed from or the proceedings therein will be considered
unless stated in the assignment of errors, or closely related to or
dependent on an assigned error and properly argued in the brief, save
as the court pass upon plain errors and clerical errors.
Essentially, the general rule provides that an assignment of error is
essential to appellate review and only those assigned will be
considered,[19] save for the following exceptions: (1) grounds not
assigned as errors but affecting jurisdiction over the subject matter;
(2) matters not assigned as errors on appeal but are evidently plain or
clerical errors within the contemplation of the law; (3) matters not
assigned as errors on appeal but consideration of which is necessary
in arriving at a just decision and complete resolution of the case or to
serve the interest of justice or to avoid dispensing piecemeal justice;
(4) matters not specifically assigned as errors on appeal but raised in
the trial court and are matters of record having some bearing on the
issue submitted which the parties failed to raise or which the lower
court ignored; (5) matters not assigned as errors on appeal but closely
related to an error assigned; and (6) matters not assigned as errors
on appeal but which the determination of a question properly assigned
is dependent.[20] None of these exceptions exists in this case.
Notably, the prayer portion of the BDO-EPCIB petition in CA-G.R. SP
No. 101881 only sought for the following
reliefs:chanroblesvirtuallawlibrary
WHEREFORE, it is respectfully prayed of the Honorable Court that
the Decision dated 03 December 2007 of the Court a quo, or the
approved Rehabilitation Plan, be MODIFIED accordingly,
thus:chanroblesvirtuallawlibrary
1. Under its Phase 1, the articles of incorporation and by laws of SCP
be accordingly amended to accommodate the additional equity of
Php3.0 Billion.
2. Under Phase 2, the present stockholders and/or the Rehabilitation
Receiver shall offer for sale to acceptable investors SCPs stocks,
through negotiated sale or bidding for an amount not less than Php3.0
Billion, which is equivalent to approximately 64% of SCP; and
3. Under Phase 3, there shall be an immediate conversion of debt to
common shares in the required amount of Php3.0 Billion, which is
equivalent to approximately 64% of SCP, pursuant to the terms and
conditions of the Recommended Rehabilitation Plan.
Other reliefs, just and equitable under the premises, are likewise
prayed for.[21]cralaw
It is very plain in the language of the prayers of BDO-EPCIB that it
only requested the CA to modify the existing rehabilitation plan. It
never sought the termination of the rehabilitation proceedings. Thus,
given the factual backdrop of the case, it was inappropriate for the
CA, motu proprio, to terminate the proceedings. The appellate court
should have proceeded to resolve BDO-EPCIBs appeal on its merits
instead of terminating the proceedings, a result that has no ground in
its pleadings in the CA.
In Abedes v. Court of Appeals, this Court emphasized the difference of
appeals in criminal cases and in civil cases by saying, Issues not
raised in the pleadings, as opposed to ordinary appeal of criminal
cases where the whole case is opened for review, are deemed waived
or abandoned.[22] Essentially, to warrant consideration on appeal,
there must be discussion of the error assigned, else, the error will be
deemed abandoned or waived.[23]cralaw
This Court even went further in Development Bank of the Philippines
v. Teston, in which it held that it is improper to enter an order which
exceeds the scope of the relief sought by the pleadings, to
wit:chanroblesvirtuallawlibrary
The Court of Appeals erred in ordering DBP to return to respondent
the P1,000,000.00 alleged down payment, a matter not raised in
respondents Petition for Review before it. In Jose Clavano, Inc. v.
Housing and Land Use Regulatory Board, this Court
held:chanroblesvirtuallawlibrary
x x x It is elementary that a judgment must conform to, and be
supported by, both the pleadings and the evidence, and must be in
accordance with the theory of the action on which the pleadings are
framed and the case was tried. The judgment must be secundum
allegata et probate. (Italics in original.)
Due process considerations justify this requirement. It is improper to
enter an order which exceeds the scope of relief sought by the
pleadings, absent notice which affords the opportunity to be heard
with respect to the proposed relief. The fundamental purpose of the
55
requirement that allegations of a complaint must provide the measure

of recovery is to prevent surprise to the defendant.[24] (Emphasis
supplied.)
Thus, this Court cannot sustain the ruling of the CA insofar as it
granted a relief not prayed for by the BDO-EPCIB.
WHEREFORE, the petition in G.R. No. 190462 is PARTIALLY
GRANTED and the petition in G.R. No. 190538 is GRANTED. The
July 3, 2008 Decision and December 3, 2009 Resolution of the CA in
CA-G.R. SP No. 101881 are REVERSED and SET ASIDE.
Further, the Court hereby REMANDS these cases to the CA for
consolidation with CA-G.R. SP No. 101732. Likewise, CA-G.R. SP
No. 101880 is also ordered to be consolidated with CA-G.R. SP No.
101732.
[G.R. No. L-41115. September 11, 1982.]

REPUBLIC OF THE PHILIPPINES and CITY OF CAGAYAN DE
ORO, Petitioners, v. THE COURT OF APPEALS, BENEDICTA
MACABALE SALCEDO, ISIDRO S. BACULIO, EMMANUEL AKUT,
IRENEO ORLINO, LUCY P. GASTON, ROSARIO JAVIER, HONESTO
N. SALCEDO, RUPERTA AGUILOR, GORGONIA BRIONES,
FRANCISCO Q. BELTRAN, ERIBERTO CAMBA, GENOVEVA C.
SAN JUAN, FEDERICO P. PICAR, EUGENIA GARCIA, THE LAND
REGISTRATION COMMISSION, and THE REGISTER OF DEEDS
OF MISAMIS ORIENTAL, Respondents.
[
Consolidation of Civil and Criminal cases; allowed (Sec. 2 (a) Rule

111 of 1985 Criminal Procedure)
56

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Purpose of discovery

BERNARDO MERCADER VS. DBP

Facts: During the trial, P offered evidence on an issue not alleged in

DAVIDE, JR., C.J.:

Civil Case No. R-18521 was for specific performance filed on 28

in the sum of not less that P25,000" ;

(1) the loan of spouses Juan and Juana Maderazo; and

respect be accorded to the contract of lease the MERCADERs

(2) the deep-sea fishing loan of spouses Felipe and Florentina

It denied any knowledge or information of: (1) any flaw or infirmity in

a. First Option Sale

In its answer, the DBP admitted:chanrob1es virtual 1aw library

P96,200.00 Purchase price

The DBP maintained that the alleged unregistered interests of the

b. Second Option Lease-Purchase

In the meantime or on 26 November 1979, Lot No. 2985 was sold,

c. Third Option Lease

1,202.50 Monthly lease

(1) a letter dated 24 June 1981 wherein the MERCADERs proposed

P14,430.00 Equivalent to 15% annual interest of P96,200

(3) a letter dated 18 November 1982 whereby the MERCADERs

The DBP issued an official receipt for the payment of P3,315 as

virtual 1aw library

DBPs counsel to the MERCADERs introduction of evidence relative

We objected to the filing of the supplemental complaint and to all

We interposed an objection on this option, Your Honor, because any

There is no showing that it has been admitted by the court.

I wish to correct counsel. Records will show that there was no

The DBP is undoubtedly estopped from questioning the trial courts

SECTION 4. Record of pre-trial results. After the pre-trial the court

by the parties as to any of the matters considered. Such order shall

evidence is objected to at the trial on the ground that it is not within

Air Philippines vs Pennswell Inc.

Jurisprudence has consistently acknowledged the private character of

and ingredients of respondents products to conduct a comparative

6969 and right to information under Sec. 7, Art III?

transactions are among the recognized restrictions to the right of the

Issue: Can chemical components of Pennswell products be accessed

Petitioner cannot rely on Section 77 of Republic Act 7394, or the

Trade secrets should receive greater protection from discovery,

business of manufacturing and selling industrial chemicals, solvents,

evidence. Such a condition is in addition to the requisite that the items

June 29, 1984

voluminous; [2] there is no good cause shown for the issuance

III.chanrobles virtual law library

equity to account for and yield up his gains on a principle analogous

In recovering the loss suffered by the aggrieved party due to unfair

of the case of Converse Rubber Corporation vs. Jacinto Rubber &

2. Resolution dated 12 May 2003,2 denying petitioner's motion for

Cal's Corporation deposited the above checks in its account with

invoices of petitioner, the investigation disclosed that the same could

grave abuse of discretion on the part of Judge Contreras, which

specified. As characterized in H.C. Liebenow v. The Philippine

It is, however, in the matter of relevancy of those books and

The Petitioner admitted, when he testified in the Regional Trial Court,

transcripts". Upon reading those supplemental typed transcripts,

that said decision was based on incomplete and tampered transcript,

judge or his successor to pronounce the corresponding judgement, it

herein, conclusive upon us. Under these circumstances, we should

ARTURO H. TROCIO, petitioner-appellant, vs. JORGE LABAYO,

case for pre-trial. The provincial fiscal who represented the

inclusion of Maningas as party defendant on the ground that

Appellee counters with the contention that contrary to the rules of

The Republic of the Philippines, in this special civil action