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Persons Arts.

36-40 - 1

ART 36 CIVIL CODE; RULE III Sections 6&7 RoC; PREJUDICIAL


QUESTION

the herein accused did not detract from the correctness of her cause, since a motion
for suspension of a criminal action may be filed at any time before the prosecution
rests (Section 6, Rule 111, Revised Rules of Court).8

DREAMWORK CONSTRUCTION, INC v. JANIOLA

In an Order dated March 12, 2008,9 the MTC denied petitioners Motion for
Reconsideration dated November 29, 2007.

Petitioner Dreamwork Construction, Inc. seeks the reversal of the August 26, 2008
Decision1 in SCA No. 08-0005 of the Regional Trial Court (RTC), Branch 253 in Las
Pias City. The Decision affirmed the Orders dated October 16, 20072 and March 12,
20083 in Criminal Case Nos. 55554-61 issued by the Metropolitan Trial Court (MTC),
Branch 79 in Las Pias City.
The Facts
On October 18, 2004, petitioner, through its President, Roberto S. Concepcion, and
Vice-President for Finance and Marketing, Normandy P. Amora, filed a Complaint
Affidavit dated October 5, 20044 for violation of Batas Pambansa Bilang 22 (BP 22)
against private respondent Cleofe S. Janiola with the Office of the City Prosecutor of
Las Pias City. The case was docketed as I.S. No. 04-2526-33. Correspondingly,
petitioner filed a criminal information for violation of BP 22 against private respondent
with the MTC on February 2, 2005 docketed as Criminal Case Nos. 55554-61, entitled
People of the Philippines v. Cleofe S. Janiola.

Petitioner appealed the Orders to the RTC with a Petition dated May 13, 2008.
Thereafter, the RTC issued the assailed decision dated August 26, 2008, denying the
petition. On the issue of the existence of a prejudicial question, the RTC ruled:
Additionally, it must be stressed that the requirement of a "previously" filed civil case
is intended merely to obviate delays in the conduct of the criminal proceedings.
Incidentally, no clear evidence of any intent to delay by private respondent was
shown. The criminal proceedings are still in their initial stages when the civil action
was instituted. And, the fact that the civil action was filed after the criminal action
was instituted does not render the issues in the civil action any less prejudicial in
character.10
Hence, we have this petition under Rule 45.
The Issue

On September 20, 2006, private respondent, joined by her husband, instituted a civil
complaint against petitioner by filing a Complaint dated August 20065 for the
rescission of an alleged construction agreement between the parties, as well as for
damages. The case was filed with the RTC, Branch 197 in Las Pias City and docketed
as Civil Case No. LP-06-0197. Notably, the checks, subject of the criminal cases before
the MTC, were issued in consideration of the construction agreement.

WHETHER OR NOT THE COURT A QUO SERIOUSLY ERRED IN NOT PERCEIVING GRAVE
ABUSE OF DISCRETION ON THE PART OF THE INFERIOR COURT, WHEN THE LATTER
RULED TO SUSPEND PROCEEDINGS IN CRIM. CASE NOS. 55554-61 ON THE BASIS OF
"PREJUDICIAL QUESTION" IN CIVIL CASE NO. LP-06-0197.11

Thereafter, on July 25, 2007, private respondent filed a Motion to Suspend


Proceedings dated July 24, 20076 in Criminal Case Nos. 55554-61, alleging that the
civil and criminal cases involved facts and issues similar or intimately related such
that in the resolution of the issues in the civil case, the guilt or innocence of the
accused would necessarily be determined. In other words, private respondent claimed
that the civil case posed a prejudicial question as against the criminal cases.

This petition must be granted.

Petitioner opposed the suspension of the proceedings in the criminal cases in an


undated Comment/Opposition to Accuseds Motion to Suspend Proceedings based on
Prejudicial Question7 on the grounds that: (1) there is no prejudicial question in this
case as the rescission of the contract upon which the bouncing checks were issued is
a separate and distinct issue from the issue of whether private respondent violated BP
22; and (2) Section 7, Rule 111 of the Rules of Court states that one of the elements
of a prejudicial question is that "the previously instituted civil action involves an issue
similar or intimately related to the issue raised in the subsequent criminal action";
thus, this element is missing in this case, the criminal case having preceded the civil
case.
Later, the MTC issued its Order dated October 16, 2007, granting the Motion to
Suspend Proceedings, and reasoned that:
Should the trial court declare the rescission of contract and the nullification of the
checks issued as the same are without consideration, then the instant criminal cases
for alleged violation of BP 22 must be dismissed. The belated filing of the civil case by

The Courts Ruling

The Civil Action Must Precede the Filing of the


Criminal Action for a Prejudicial Question to Exist
Under the 1985 Rules on Criminal Procedure, as amended by Supreme Court
Resolutions dated June 17, 1988 and July 7, 1988, the elements of a prejudicial
question are contained in Rule 111, Sec. 5, which states:
SEC. 5. Elements of prejudicial question. The two (2) essential elements of a
prejudicial question are: (a) the civil action involves an issue similar or intimately
related to the issue raised in the criminal action; and (b) the resolution of such issue
determines whether or not the criminal action may proceed.
Thus, the Court has held in numerous cases12 that the elements of a prejudicial
question, as stated in the above-quoted provision and in Beltran v. People,13 are:
The rationale behind the principle of prejudicial question is to avoid two conflicting
decisions. It has two essential elements: (a) the civil action involves an issue similar
or intimately related to the issue raised in the criminal action; and (b) the resolution
of such issue determines whether or not the criminal action may proceed.

On December 1, 2000, the 2000 Rules on Criminal Procedure, however, became


effective and the above provision was amended by Sec. 7 of Rule 111, which applies
here and now provides:
SEC. 7. Elements of prejudicial question.The elements of a prejudicial question are:
(a) the previously instituted civil action involves an issue similar or intimately related
to the issue raised in the subsequent criminal action, and (b) the resolution of such
issue determines whether or not the criminal action may proceed. (Emphasis
supplied.)
Petitioner interprets Sec. 7(a) to mean that in order for a civil case to create a
prejudicial question and, thus, suspend a criminal case, it must first be established
that the civil case was filed previous to the filing of the criminal case. This, petitioner
argues, is specifically to guard against the situation wherein a party would belatedly
file a civil action that is related to a pending criminal action in order to delay the
proceedings in the latter.
On the other hand, private respondent cites Article 36 of the Civil Code which
provides:
Art. 36. Pre-judicial questions which must be decided before any criminal prosecution
may be instituted or may proceed, shall be governed by rules of court which the
Supreme Court shall promulgate and which shall not be in conflict with the provisions
of this Code. (Emphasis supplied.)
Private respondent argues that the phrase "before any criminal prosecution may be
instituted or may proceed" must be interpreted to mean that a prejudicial question
exists when the civil action is filed either before the institution of the criminal action
or during the pendency of the criminal action. Private respondent concludes that
there is an apparent conflict in the provisions of the Rules of Court and the Civil Code
in that the latter considers a civil case to have presented a prejudicial question even if
the criminal case preceded the filing of the civil case.
We cannot agree with private respondent.
First off, it is a basic precept in statutory construction that a "change in phraseology
by amendment of a provision of law indicates a legislative intent to change the
meaning of the provision from that it originally had."14 In the instant case, the
phrase, "previously instituted," was inserted to qualify the nature of the civil action
involved in a prejudicial question in relation to the criminal action. This interpretation
is further buttressed by the insertion of "subsequent" directly before the term criminal
action. There is no other logical explanation for the amendments except to qualify the
relationship of the civil and criminal actions, that the civil action must precede the
criminal action.

Persons Arts. 36-40 - 2

Sec. 6. Suspension by reason of prejudicial question. - A petition for suspension of the


criminal action based upon the pendency of a prejudicial question in a civil action may
be filed in the office of the prosecutor or the court conducting the preliminary
investigation. When the criminal action has been filed in court for trial, the petition to
suspend shall be filed in the same criminal action at any time before the prosecution
rests.

Sec. 7. Elements of prejudicial question. - The elements of a prejudicial question are:


(a) the previously instituted civil action involves an issue similar or intimately related
to the issue raised in the subsequent criminal action, and (b) the resolution of such
issue determines whether or not the criminal action may proceed.
Under the amendment, a prejudicial question is understood in law as that which must
precede the criminal action and which requires a decision before a final judgment can
be rendered in the criminal action with which said question is closely connected. The
civil action must be instituted prior to the institution of the criminal action. In this
case, the Information was filed with the Sandiganbayan ahead of the complaint in
Civil Case No. 7160 filed by the State with the RTC in Civil Case No. 7160. Thus, no
prejudicial question exists. (Emphasis supplied.)
Additionally, it is a principle in statutory construction that "a statute should be
construed not only to be consistent with itself but also to harmonize with other laws
on the same subject matter, as to form a complete, coherent and intelligible
system."16 This principle is consistent with the maxim, interpretare et concordare
leges legibus est optimus interpretandi modus or every statute must be so construed
and harmonized with other statutes as to form a uniform system of jurisprudence.171
a vv p h i l
In other words, every effort must be made to harmonize seemingly conflicting laws. It
is only when harmonization is impossible that resort must be made to choosing which
law to apply.
In the instant case, Art. 36 of the Civil Code and Sec. 7 of Rule 111 of the Rules of
Court are susceptible of an interpretation that would harmonize both provisions of law.
The phrase "previously instituted civil action" in Sec. 7 of Rule 111 is plainly worded
and is not susceptible of alternative interpretations. The clause "before any criminal
prosecution may be instituted or may proceed" in Art. 36 of the Civil Code may,
however, be interpreted to mean that the motion to suspend the criminal action may
be filed during the preliminary investigation with the public prosecutor or court
conducting the investigation, or during the trial with the court hearing the case.
This interpretation would harmonize Art. 36 of the Civil Code with Sec. 7 of Rule 111
of the Rules of Court but also with Sec. 6 of Rule 111 of the Civil Code, which provides
for the situations when the motion to suspend the criminal action during the
preliminary investigation or during the trial may be filed. Sec. 6 provides:

Thus, this Court ruled in Torres v. Garchitorena15 that:


Even if we ignored petitioners procedural lapse and resolved their petition on the
merits, we hold that Sandiganbayan did not abuse its discretion amounting to excess
or lack of jurisdiction in denying their omnibus motion for the suspension of the
proceedings pending final judgment in Civil Case No. 7160. Section 6, Rule lll of the
Rules of Criminal Procedure, as amended, reads:

SEC. 6. Suspension by reason of prejudicial question.A petition for suspension of the


criminal action based upon the pendency of a prejudicial question in a civil action may
be filed in the office of the prosecutor or the court conducting the preliminary
investigation. When the criminal action has been filed in court for trial, the petition to
suspend shall be filed in the same criminal action at any time before the prosecution
rests.

Thus, under the principles of statutory construction, it is this interpretation of Art. 36


of the Civil Code that should govern in order to give effect to all the relevant
provisions of law.
It bears pointing out that the circumstances present in the instant case indicate that
the filing of the civil action and the subsequent move to suspend the criminal
proceedings by reason of the presence of a prejudicial question were a mere
afterthought and instituted to delay the criminal proceedings.
In Sabandal v. Tongco,18 we found no prejudicial question existed involving a civil
action for specific performance, overpayment, and damages, and a criminal complaint
for BP 22, as the resolution of the civil action would not determine the guilt or
innocence of the accused in the criminal case. In resolving the case, we said:
Furthermore, the peculiar circumstances of the case clearly indicate that the filing of
the civil case was a ploy to delay the resolution of the criminal cases. Petitioner filed
the civil case three years after the institution of the criminal charges against him.
Apparently, the civil action was instituted as an afterthought to delay the proceedings
in the criminal cases.19
Here, the civil case was filed two (2) years after the institution of the criminal
complaint and from the time that private respondent allegedly withdrew its
equipment from the job site. Also, it is worth noting that the civil case was instituted
more than two and a half (2 ) years from the time that private respondent allegedly
stopped construction of the proposed building for no valid reason. More importantly,
the civil case praying for the rescission of the construction agreement for lack of
consideration was filed more than three (3) years from the execution of the
construction agreement.
Evidently, as in Sabandal, the circumstances surrounding the filing of the cases
involved here show that the filing of the civil action was a mere afterthought on the
part of private respondent and interposed for delay. And as correctly argued by
petitioner, it is this scenario that Sec. 7 of Rule 111 of the Rules of Court seeks to
prevent. Thus, private respondents positions cannot be left to stand.
The Resolution of the Civil Case Is Not
Determinative of the Prosecution of the Criminal Action
In any event, even if the civil case here was instituted prior to the criminal action,
there is, still, no prejudicial question to speak of that would justify the suspension of
the proceedings in the criminal case.
To reiterate, the elements of a prejudicial question under Sec. 7 of Rule 111 of the
Rules of Court are: (1) the previously instituted civil action involves an issue similar or
intimately related to the issue raised in the subsequent criminal action; and (2) the
resolution of such issue determines whether or not the criminal action may proceed.
Petitioner argues that the second element of a prejudicial question, as provided in
Sec. 7 of Rule 111 of the Rules, is absent in this case. Thus, such rule cannot apply to
the present controversy.
Private respondent, on the other hand, claims that if the construction agreement
between the parties is declared null and void for want of consideration, the checks
issued in consideration of such contract would become mere scraps of paper and
cannot be the basis of a criminal prosecution.

Persons Arts. 36-40 - 3

We find for petitioner.


It must be remembered that the elements of the crime punishable under BP 22 are as
follows:
(1) the making, drawing, and issuance of any check to apply for account or for value;
(2) the knowledge of the maker, drawer, or issuer that at the time of issue there are
no sufficient funds in or credit with the drawee bank for the payment of such check in
full upon its presentment; and
(3) the 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.20
Undeniably, the fact that there exists a valid contract or agreement to support the
issuance of the check/s or that the checks were issued for valuable consideration does
not make up the elements of the crime. Thus, this Court has held in a long line of
cases21 that the agreement surrounding the issuance of dishonored checks is
irrelevant to the prosecution for violation of BP 22. In Mejia v. People,22 we ruled:
It must be emphasized that the gravamen of the offense charge is the issuance of a
bad check. The purpose for which the check was issued, the terms and conditions
relating to its issuance, or any agreement surrounding such issuance are irrelevant to
the prosecution and conviction of petitioner. To determine the reason for which checks
are issued, or the terms and conditions for their issuance, will greatly erode the faith
the public reposes in the stability and commercial value of checks as currency
substitutes, and bring havoc in trade and in banking communities. The clear intention
of the framers of B.P. 22 is to make the mere act of issuing a worthless check malum
prohibitum.
Lee v. Court of Appeals23 is even more poignant. In that case, we ruled that the issue
of lack of valuable consideration for the issuance of checks which were later on
dishonored for insufficient funds is immaterial to the success of a prosecution for
violation of BP 22, to wit:
Third issue. Whether or not the check was issued on account or for value.
Petitioners claim is not feasible. We have held that upon issuance of a check, in the
absence of evidence to the contrary, it is presumed that the same was issued for
valuable consideration. Valuable consideration, in turn, may consist either in some
right, interest, profit or benefit accruing to the party who makes the contract, or some
forbearance, detriment, loss or some responsibility, to act, or labor, or service given,
suffered or undertaken by the other side. It is an obligation to do, or not to do in favor
of the party who makes the contract, such as the maker or indorser.
In this case, petitioner himself testified that he signed several checks in blank, the
subject check included, in exchange for 2.5% interest from the proceeds of loans that
will be made from said account. This is a valuable consideration for which the check
was issued. That there was neither a pre-existing obligation nor an obligation incurred
on the part of petitioner when the subject check was given by Bautista to private
complainant on July 24, 1993 because petitioner was no longer connected with Unlad
or Bautista starting July 1989, cannot be given merit since, as earlier discussed,

petitioner failed to adequately prove that he has severed his relationship with
Bautista or Unlad.
At any rate, we have held that what the law punishes is the mere act of issuing a
bouncing check, not the purpose for which it was issued nor the terms and conditions
relating to its issuance. This is because the thrust of the law is to prohibit the making
of worthless checks and putting them into circulation.24 (Emphasis supplied.)
Verily, even if the trial court in the civil case declares that the construction agreement
between the parties is void for lack of consideration, this would not affect the
prosecution of private respondent in the criminal case. The fact of the matter is that
private respondent indeed issued checks which were subsequently dishonored for
insufficient funds. It is this fact that is subject of prosecution under BP 22.lawphil.net
Therefore, it is clear that the second element required for the existence of a
prejudicial question, that the resolution of the issue in the civil action would determine
whether the criminal action may proceed, is absent in the instant case. Thus, no
prejudicial question exists and the rules on it are inapplicable to the case before us.
WHEREFORE, we GRANT this petition. We hereby REVERSE and SET ASIDE the August
26, 2008 Decision in SCA No. 08-0005 of the RTC, Branch 253 in Las Pias City and
the Orders dated October 16, 2007 and March 12, 2008 in Criminal Case Nos. 5555461 of the MTC, Branch 79 in Las Pias City. We order the MTC to continue with the
proceedings in Criminal Case Nos. 55554-61 with dispatch.
No costs. SO ORDERED.

QUIAMBAO v. OSORIO
This case was certified to Us by the Court of Appeals as one involving pure questions
of law pursuant to Section 3, Rule 50 of the Revised Rules of Court.
The antecedents are as follows:
In a complaint for forcible entry filed by herein private respondents Zenaida Gaza
Buensucero, Justina Gaza Bernardo and Felipe Gaza against herein petitioner Ricardo
Quiambao before the then Municipal Court of Malabon, Rizal, docketed therein as Civil
Case No. 2526, it was alleged that private respondents were the legitimate possessors
of a 30,835 sq. m. lot known as Lot No. 4, Block 12, Bca 2039 of the Longos Estate
situated at Barrio Longos, Malabon Rizal, by virtue of the Agreement to Sell No. 3482
executed in their favor by the former Land Tenure Administration [which later became
the Land Authority, then the Department of Agrarian Reform]; that under cover of
darkness, petitioner surreptitiously and by force, intimidation, strategy and stealth,
entered into a 400 sq. m. portion thereof, placed bamboo posts "staka" over said
portion and thereafter began the construction of a house thereon; and that these acts
of petitioner, which were unlawful per se, entitled private respondents to a writ of
preliminary injunction and to the ejectment of petitioner from the lot in question.
Petitioner filed a motion to dismiss the complaint, and upon denial thereof, filed his
Answer to the complaint, specifically denying the material allegations therein and

Persons Arts. 36-40 - 4

averring that the Agreement upon which private respondents base their prior
possession over the questioned lot had already been cancelled by the Land Authority
in an Order signed by its Governor, Conrado Estrella. By way of affirmative defense
and as a ground for dismissing the case, petitioner alleged the pendency of L.A. Case
No. 968, an administrative case before the Office of the Land Authority between the
same parties and involving the same piece of land. In said administrative case,
petitioner disputed private respondents' right of possession over the property in
question by reason of the latter's default in the installment payments for the purchase
of said lot. Petitioner asserted that his administrative case was determinative of
private respondents' right to eject petitioner from the lot in question; hence a
prejudicial question which bars a judicial action until after its termination.

After hearing, the municipal court denied the motion to dismiss contained in
petitioner's affirmative defenses. It ruled that inasmuch as the issue involved in the
case was the recovery of physical possession, the court had jurisdiction to try and
hear the case.
Dissatisfied with this ruling, petitioner filed before the then Court of First Instance of
Rizal, Branch XII, Caloocan City in Civil Case No. C-1576 a petition for certiorari with
injunction against public respondent Judge Adriano Osorio of the Municipal Court of
Malabon and private respondents, praying for the issuance of a writ of preliminary
injunction ordering respondent judge to suspend the hearing in the ejectment case
until after the resolution of said petition. As prayed for, the then CFI of Rizal issued a
restraining order enjoining further proceedings in the ejectment case.
In his answer, respondent municipal judge submitted himself to the sound discretion
of the CFI in the disposition of the petition for certiorari. Private respondents, on the
other hand, filed a motion to dismiss the petition, maintaining that the administrative
case did not constitute a prejudicial question as it involved the question of ownership,
unlike the ejectment case which involved merely the question of possession.
Meanwhile, the Land Authority filed an Urgent Motion for Leave to Intervene in Civil
Case No. C-1576 alleging the pendency of an administrative case between the same
parties on the same subject matter in L.A. Case No. 968 and praying that the petition
for certiorari be granted, the ejectment complaint be dismissed and the Office of the
Land Authority be allowed to decide the matter exclusively.
Finding the issue involved in the ejectment case to be one of prior possession, the CFI
dismissed the petition for certiorari and lifted the restraining order previously issued.
Petitioner's motion for reconsideration of the dismissal order, adopted in toto by
Intervenor Land Authority was denied for lack of merit. Hence, this appeal filed by
petitioner Quiambao and intervenor Land Authority with the Court of Appeals, and
certified to Us as aforesaid.
The instant controversy boils down to the sole question of whether or not the
administrative case between the private parties involving the lot subject matter of the
ejectment case constitutes a prejudicial question which would operate as a bar to said
ejectment case.
A prejudicial question is understood in law to be that which arises in a case the
resolution of which is a logical antecedent of the issue involved in said case and the
cognizance of which pertains to another tribunal. 1 The doctrine of prejudicial
question comes into play generally in a situation where civil and criminal actions are
pending and the issues involved in both cases are similar or so closely related that an

issue must be pre-emptively resolved in the civil case before the criminal action can
proceed. Thus, the existence of a prejudicial question in a civil case is alleged in the
criminal case to cause the suspension of the latter pending final determination of the
former.
The essential elements of a prejudicial question as provided under Section 5, Rule 111
of the Revised Rules of Court are: [a] the civil action involves an issue similar or
intimately related to the issue in the criminal action; and [b] the resolution of such
issue determines whether or not the criminal action may proceed.
The actions involved in the case at bar being respectively civil and administrative in
character, it is obvious that technically, there is no prejudicial question to speak of.
Equally apparent, however, is the intimate correlation between said two [2]
proceedings, stemming from the fact that the right of private respondents to eject
petitioner from the disputed portion depends primarily on the resolution of the
pending administrative case. For while it may be true that private respondents had
prior possession of the lot in question, at the time of the institution of the ejectment
case, such right of possession had been terminated, or at the very least, suspended
by the cancellation by the Land Authority of the Agreement to Sell executed in their
favor. Whether or not private respondents can continue to exercise their right of
possession is but a necessary, logical consequence of the issue involved in the
pending administrative case assailing the validity of the cancellation of the
Agreement to Sell and the subsequent award of the disputed portion to petitioner. If
the cancellation of the Agreement to Sell and the subsequent award to petitioner are
voided, then private respondents would have every right to eject petitioner from the
disputed area. Otherwise, private respondent's light of possession is lost and so would
their right to eject petitioner from said portion.
Faced with these distinct possibilities, the more prudent course for the trial court to
have taken is to hold the ejectment proceedings in abeyance until after a
determination of the administrative case. Indeed, logic and pragmatism, if not
jurisprudence, dictate such move. To allow the parties to undergo trial
notwithstanding the possibility of petitioner's right of possession being upheld in the
pending administrative case is to needlessly require not only the parties but the court
as well to expend time, effort and money in what may turn out to be a sheer exercise
in futility. Thus, 1 Am Jur 2d tells us:
The court in which an action is pending may, in the exercise of a sound discretion,
upon proper application for a stay of that action, hold the action in abeyance to abide
the outcome of another pending in another court, especially where the parties and
the issues are the same, for there is power inherent in every court to control the
disposition of causes on its dockets with economy of time and effort for itself, for
counsel, and for litigants. Where the rights parties to the second action cannot be
properly determined until the questions raised in the first action are settled the
second action should be stayed. 2
While this rule is properly applicable to instances involving two [2] court actions, the
existence in the instant case of the same considerations of Identity of parties and
issues, economy of time and effort for the court, the counsels and the parties as well
as the need to resolve the parties' right of possession before the ejectment case may
be properly determined, justifies the rule's analogous application to the case at bar.
Fortich-Celdran, et al. vs. Celdran, et al., 19 SCRA 502, provides another analogous
situation. In sustaining the assailed order of the then Court of First Instance of

Persons Arts. 36-40 - 5

Misamis Oriental ordering the suspension of the criminal case for falsification of public
document against several persons, among them the subscribing officer Santiago
Catane until the civil case involving the issue of the genuineness of the alleged forged
document shall have been decided, this Court cited as a reason therefor its own
action on the administrative charges against said Santiago Catane, as follows:
It should be mentioned here also that an administrative case filed in this Court against
Santiago Catane upon the same charge was held by Us in abeyance, thus:
"As it appears that the genuineness of the document allegedly forged by respondent
attorneys in Administrative Case No. 77 [Richard Ignacio Celdran vs. Santiago Catane,
etc., et al.] is necessarily involved in Civil Case No. R-3397 of the Cebu Court of First
Instance, action on the herein complaint is withheld until that litigation has finally
been decided. Complainant Celdran shall inform the Court about such decision." 3
If a pending civil case may be considered to be in the nature of a prejudicial question
to an administrative case, We see no reason why the reverse may not be so
considered in the proper case, such as in the petition at bar. Finally, events occuring
during the pendency of this petition attest to the wisdom of the conclusion herein
reached. For in the Manifestation filed by counsel for petitioner, it was stated that the
intervenor Land Authority which later became the Department of Agrarian Reform had
promulgated a decision in the administrative case, L.A. Case No. 968 affiriming the
cancellation of Agreement to Sell No. 3482 issued in favor of private respondents.
With this development, the folly of allowing the ejectment case to proceed is too
evident to need further elaboration.
WHEREFORE, the instant petition is hereby GRANTED. Civil Case No. 2526 of the then
Municipal Court of Malabon, Rizal is hereby ordered DISMISSED. No Costs. SO
ORDERED

YAP v. PARAS
This is still another dispute between brother and sister over a piece of property they
inherited from their parents. The case is complicated by the circumstance that the
private respondent's counsel in this petition is the son of the judge, the other
respondent, whose action is being questioned.
Petitioner Juliana P. Yap was the sister of private respondent Martin Paras.*
On October 31, 1971, according to Yap, Paras sold to her his share in the intestate
estate for P300.00. The sale was evidenced by a private document. Nineteen years
later, on May 2, 1990, Paras sold the same property to Santiago Saya-ang for
P5,000.00. This was evidenced by a notarized Deed of Absolute Sale.
When Yap learned of the second sale, she filed a complaint for estafa against Paras
and Saya-ang with the Office of the Provincial Prosecutor of General Santos City. 1 On
the same date, she filed a complaint for the nullification of the said sale with the
Regional Trial Court of General Santos City. 2
After investigation, the Provincial Prosecutor instituted a criminal complaint for estafa
against Paras with the Municipal Circuit Trial Court of Glan-Malapatan, South Cotabato,
presided by Judge Alfredo D. Barcelona, Sr.

On April 17, 1991, before arraignment of the accused, the trial judge motu proprio
issued an order dismissing the criminal case on the ground that:
. . . after a careful scrutiny of the statements of complainant, Juliana P. Yap and of the
respondent Martin Paras and his witnesses, the Court holds and maintained (sic) that
there is a prejudicial question to a civil action, which must be ventilated in the proper
civil court. In the case of Ras vs. Rasul, 100 SCRA 125, the Supreme Court had already
made a pronouncement that "a criminal action for Estafa for alleged double sale of
property is a prejudicial question to a civil action for nullity of the alleged Deed of Sale
and defense of the alleged vendors of forgeries of their signatures to the Deed." 3
The Petitioner moved for reconsideration, which was denied on April 30, 1990. She
then came to this Court for relief in this special civil action for certiorari.
The Court could have referred this petition to the Court of Appeals, which has
concurrent jurisdiction under BP 129, but decided to resolve the case directly in view
of the peculiar circumstances involved.
The petitioner's contention is that where there is a prejudicial question in a civil case,
the criminal action may not be dismissed but only suspended. Moreover, this
suspension may not be done motu proprio by the judge trying the criminal case but
only upon petition of the defendant in accordance with the Rules of Court. It is also
stressed that a reversal of the order of dismissal would not bar the prosecution of the
accused under the double jeopardy rule because he has not yet been arraigned.
The Court notes that the counsel for private respondent Paras who filed the comment
in his behalf is the son and namesake of Judge Barcelona. Atty. Alfredo L. Barcelona, Jr.
is employed in the Public Attorney's Office. He has made it of record that he was not
the counsel of Paras at the time the questioned order of dismissal was issued by his
father. He thus impliedly rejects the charge of bias against his father.
Perhaps out of filial loyalty, Atty. Barcelona suggests there may have been a basis for
the order in view of the alleged double sale of the property which was being litigated
in the regional trial court. He concedes, however, that the order may have been
premature and that it could not have been issued motu proprio. Agreeing that double
jeopardy would not attach because of the lack of arraignment, he asks that his
Comment be considered a motion for the suspension of the criminal action on the
ground of prejudicial question.
The Court has deliberated on the issues and finds that the respondent judge did
indeed commit grave abuse of discretion in motu proprio issuing the order of
dismissal.
Section 6, Rule 111 of the 1985 Rules on Criminal Procedure as amended by this Court
on July 7, 1988, provides as follows:
Sec. 6.
Suspension by reason of prejudicial question. A petition for suspension
of the criminal action based upon the pendency of a prejudicial question in a civil
action may be filed in the office of the fiscal or the court conducting the preliminary
investigation. When the criminal action has been filed in court for trial, the petition to
suspend shall be filed in the same criminal action at any time before the prosecution
rests.

Persons Arts. 36-40 - 6

Judge Barcelona's precipitate action is intriguing, to say the least, in light of the clear
provision of the above-quoted rule. The rule is not even new, being only a rewording
of the original provision in the Rules of Court before they were amended. It plainly
says that the suspension may be made only upon petition and not at the instance of
the judge alone, and it also says suspension, and not dismissal. One also wonders if
the person who notarized the disputed second sale, Notary Public Alexander C.
Barcelona, might be related to the respondent judge.
But more important than the preceding considerations
misapprehension of the concept of a prejudicial question.

is

the

trial judge's

Section 5, Rule 111 of the 1985 Rules on Criminal Procedure as amended provides:
Sec. 5.
Elements of prejudicial question. The two (2) essential elements of a
prejudicial question are: (a) the civil action involves an issue similar or intimately
related to the issue raised in the criminal action; and (b) the resolution of such issue
determines whether or not the criminal action may proceed.
A prejudicial question is defined as that which arises in a case the resolution of which
is a logical antecedent of the issue involved therein, and the congnizance of which
pertains to another tribunal. The prejudicial question must be determinative of the
case before the court but the jurisdiction to try and resolve the question must be
lodged in another court or tribunal. 4 It is a question based on a fact distinct and
separate from the crime but so intimately connected with it that it determines the
guilt or innocence of the accused. 5
We have held that "for a civil case to be considered prejudicial to a criminal action as
to cause the suspension of the criminal action pending the determination of the civil
action, it must appear not only that the civil case involves the same facts upon which
the criminal prosecution is based, but also that the resolution of the issues raised in
said civil action would be necessarily determinative of the guilt or innocence of the
accused". 6
It is the issue in the civil action that is prejudicial to the continuation of the criminal
action, not the criminal action that is prejudicial to the civil action.
The excerpt quoted by the respondent judge in his Order does not appear anywhere
in the decision of Ras v. Rasul. 7 Worse, he has not only misquoted the decision but
also wrongly applied it. The facts of that case are not analogous to those in the case
at bar.
In that case, Ras allegedly sold to Pichel a parcel of land which he later also sold to
Martin. Pichel brought a civil action for nullification of the second sale and asked that
the sale made by Ras in his favor be declared valid. Ras's defense was that he never
sold the property to Pichel and his purported signatures appearing in the first deed of
sale were forgeries. Later, an information for estafa was filed against Ras based on
the same double sale that was the subject of the civil action. Ras filed a "Motion for
Suspension of Action" (that is, the criminal case), claiming that the resolution of the
issues in the civil case would necessarily be determinative of his guilt or innocence.
Through then Associate Justice Claudio Teehankee, this Court ruled that a suspension
of the criminal action was in order because:

On the basis of the issues raised in both the criminal and civil cases against petitioner
and in the light of the foregoing concepts of a prejudicial question, there indeed
appears to be a prejudicial question in the case at bar, considering that petitioner
Alejandro Ras' defense (as defendant) in Civil Case No. 73 of the nullity and forgery of
the alleged prior deed of sale in favor of Luis Pichel (plaintiff in the civil case and
complaining witnesses in the criminal case) is based on the very same facts which
would be necessarily determinative of petitioner Ras' guilt or innocence as accused in
the criminal case. If the first alleged sale in favor of Pichel is void or fictitious, then
there would be no double sale and petitioner would be innocent of the offense
charged. A conviction in the criminal case (if it were allowed to proceed ahead) would
be a gross injustice and would have to be set aside if it were finally decided in the civil
action that indeed the alleged prior deed of sale was a forgery and spurious.
xxx xxx

xxx

The petitioner Alejandro Ras claims in his answer to the complaint in Civil Case No. 73
that he had never sold the property in litigation to the plaintiff (Luis Pichel) and that
his signatures in the alleged deed of sale and that of his wife were forged by the
plaintiff. It is, therefore, necessary that the truth or falsity of such claim be first
determined because if his claim is true, then he did not sell his property twice and no
estafa was committed. The question of nullity of the sale is distinct and separate from
the crime of estafa (alleged double sale) but so intimately connected with it that it
determines the guilt or innocence of herein petitioner in the criminal action.
In the Ras case, there was a motion to suspend the criminal action on the ground that
the defense in the civil case forgery of his signature in the first deed of sale had
to be threshed out first. Resolution of that question would necessarily resolve the guilt
or innocence of the accused in the criminal case. By contrast, there was no motion for
suspension in the case at bar; and no less importantly, the respondent judge had not
been informed of the defense Paras was raising in the civil action. Judge Barcelona
could not have ascertained then if the issue raised in the civil action would determine
the guilt or innocence of the accused in the criminal case.
It is worth remarking that not every defense raised in the civil action will raise a
prejudicial question to justify suspension of the criminal action. The defense must
involve an issue similar or intimately related to the same issue raised in the criminal
action and its resolution should determine whether or not the latter action may
proceed.
The order dismissing the criminal action without a motion for suspension in
accordance with Rule 111, Section 6, of the 1985 Rules on Criminal Procedure as
amended, and even without the accused indicating his defense in the civil case for
the annulment of the second sale, suggests not only ignorance of the law but also
bias on the part of the respondent judge.
Judge Alfredo D. Barcelona, Sr. is sternly reminded that under the Code of Judicial
Conduct, "a judge shall be faithful to the law and maintain professional competence"
and "should administer justice impartially." He is hereby reprimanded for his
questionable conduct in the case at bar, with the warning that commission of similar
acts in the future will be dealt with more severely.
WHEREFORE, the petition is GRANTED. The Order issued by Judge Alfredo D.
Barcelona, Sr. dated April 17, 1991, dismissing Criminal Case No. 1902-G, and the
Order dated April 30, 1991, denying the motion for reconsideration, are REVERSED

Persons Arts. 36-40 - 7

and SET ASIDE. Criminal Case No. 1902-G is ordered REINSTATED for further
proceedings, but to be assigned to a different judge. SO ORDERED.

FORTRICH v. CELDRAN
A suit for annulment of an extrajudicial partition of properties and for accounting was
filed on February 3, 1954 in the Court of First Instance of Cebu (Civil Case No. 3397R).
Appearing therein as plaintiffs were: Jose, Francisco, Pedro, Jr., Ignacio, all surnamed
Abuton-Celdran (children of the deceased Pedro Celdran by the first nuptial) and, as
the administratrix of Francisco Celdran (another brother), Modesta Rodriguez.
Defendants were: Pablo Celdran (child of the deceased by the first marriage who
refused to join as plaintiff), Josefa Vda. de Celdran (spouse of the deceased by the
second marriage), Manuel, Antonio, Pedro III, Jesus, Vicente and Miguel, all surnamed
Fortich Celdran (children of the deceased by the second nuptial.
After the defendants answered on May 28, 1954, a motion to withdraw as co-plaintiff
was filed on May 24, 1957. It was signed "Ignacio Celdran. This motion has been
marked as Exhibit B-Josefa.1wph1.t
Subsequently, with leave of court, the plaintiffs (excluding Ignacio) filed an amended
complaint impleading Ignacio Celdran as defendant. Ignacio Celdran filed an answer
with counterclaim and cross-claim.
After trial but before judgment, Ignacio Celdran had the document Exh. B-Josefa (the
motion to withdraw) examined by the Police Department of Cebu City. The police were
of the view that the same (signature therein) was falsified. Alleging newly discovered
evidence, Ignacio Celdran asked for new trial, which the court denied.
All the parties, except Ignacio Celdran, thereafter entered on May 6, 1959 into an
amicable settlement, recognizing as valid the aforementioned extrajudicial partition.
Regarding Ignacio Celdran, the court rendered judgment on July 19, 1961, declaring
the same extrajudicial partition as valid for having been ratified by him (Ignacio).
Specifically, the court found among other things that Ignacio signed the motion to
withdraw (Exh. B-Josefa) after he received P10,000 of the agreed P20,000 and two
residential lots to be given to him in return for his aforesaid ratification of the
partition.
Said decision was later amended to require Pedro III, Antonio, Jesus, Miguel and
Vicente, all surnamed Fortich-Celdran, to pay Ignacio the balance of P20,000
aforestated and to deliver to him the promised two parcels of land.
Ignacio Celdran appealed therefrom to the Court of Appeals. And said appeal was
docketed as CA-G.R. No. 30499-R, shown in the record before Us as still pending.
Now on March 22, 1963, at the instance of Ignacio Celdran, an information for
falsification of a public document that is, Exh. B-Josefa or the abovementioned
motion to withdraw in the civil case was filed by the City Fiscal of Ozamis in the
Court of First Instance of Misamis Occidental. Accused therein were: Pedro III, Antonio,
Manuel, Vicente, Miguel, and Jesus, all surnamed Celdran (defendants in the civil

case); Santiago Catane, as subscribing officer; Abelardo Cecilio, as the person who
filed the motion.
As private complainant, however, Ignacio Celdran on December 12, 1962, moved
before trial to suspend the proceedings in the criminal case on the ground of
prejudicial question. The reason given in support thereof was that the alleged
falsification of the same document is at issue in the civil case pending in the Court of
Appeals.
Declaring that there was no pre-judicial question, the Court of First Instance of
Misamis Occidental denied on January 28, 1963 the motion to suspend the
prosecution. It ruled that the alleged forgery was not an issue in the civil case.
Assailing the above ruling, Ignacio Celdran filed in the Court of Appeals on February
21, 1963, a petition for certiorari with preliminary injunction (CA-G.R. No. 31909-R) to
enjoin the CFI of Misamis Occidental and the City Fiscal of Ozamis from proceeding
with the prosecution of the criminal case.
On February 18, 1964 the Court of Appeals decided said petition for certiorari,
ordering the suspension of the criminal case due to pre-judicial question.
Pedro III, Jesus, Manuel, Miguel and Vicente, all surnamed Fortich-Celdran; Santiago
Catane and Abelardo Cecilio accused in the criminal suit and respondents in the
petition for certiorari appealed to Us from the decision of the Court of Appeals
dated February 18, 1964.
Appellants would contend that there is no pre-judicial question involved. The record
shows that, as aforestated, the Court of First Instance ruled that Ignacio Celdran
ratified the partition agreement; among the reasons cited by the trial court for said
ruling is that Ignacio Celdran received P10,000 and signed the motion to withdraw as
plaintiff in the suit. Disputing this, Celdran assigned as error in his appeal the finding
that he signed the aforementioned motion (Exh. B-Josefa) and maintains that the
same is a forgery. Since ratification is principal issue in the civil action pending appeal
in the Court of Appeals, and the falsification or genuineness of the motion to withdraw
presented and marked as evidence in said civil case is among the questions
involved in said issue, it follows that the civil action poses a pre-judicial question to
the criminal prosecution for alleged falsification of the same document, the motion to
withdraw (Exh. B-Josefa).
Presented as evidence of ratification in the civil action is the motion to withdraw; its
authenticity is assailed in the same civil action. The resolution of this point in the civil
case will in a sense be determinative of the guilt or innocence of the accused in the
criminal suit pending in another tribunal. As such, it is a prejudicial question which
should first be decided before the prosecution can proceed in the criminal case.
A pre-judicial question is one that arises in a case, the resolution of which is a logical
antecedent to the issue involved therein, and the cognizance of which pertains to
another tribunal; that is, it is determinative of the case before the court and
jurisdiction to pass upon the same is lodged in another tribunal.1
It should be mentioned here also that an administrative case filed in this Court against
Santiago Catane upon the same charge was held by Us in abeyance, thus:

Persons Arts. 36-40 - 8

As it appears that the genuineness of the document allegedly forged by respondent


attorneys in Administrative Case No. 77 (Richard Ignacio Celdran vs. Santiago Catane,
etc., et al.) is necessarily involved in Civil Case No. R-3397 of the Cebu Court of First
Instance, action on the herein complaint is withheld until that litigation has finally
been decided. Complainant Celdran shall inform the Court about such decision.
(Supreme Court minute resolution of April 27, 1962 in Adm. Case No. 77, Richard
Ignacio Celdran vs. Santiago Catane, etc., et al.) .

Regarding the procedural question on Ignacio Celdran's right as private offended


party to file through counsel a motion to suspend the criminal case, the same exists
where, as herein, the Fiscal, who had direction and control of the prosecution, did not
object to the filing of said motion. And its filing in this case complied with Sec. 5 of
Rule 111 of the Rules of Court which provides:
SEC. 5. Suspension by reason of prejudicial question. A petition for the suspension
of the criminal action based upon the pendency of a pre-judicial question in a civil
case, may only be presented by any party before or during the trial of the criminal
action.
Denial of the motion to suspend the prosecution was therefore attended with grave
abuse of discretion; and the issue having been squarely and definitely presented
before the trial court, a motion for reconsideration, which would but raise the same
points, was not necessary. Neither was appeal the remedy available, since the order
denying suspension is interlocutory and thus not yet appealable.
Wherefore, the decision of the Court of Appeals under review ordering suspension
of Criminal CASE No. 5719, People vs. Pedro Fortich-Celdran, et al., pending before the
Court of First Instance of Misamis Occidental, until after Civil Case, CA-G.R. No. 30499R, Pedro A. Celdran, et al. vs. Pedro Fortich-Celdran III, et al., shall have been decided
is hereby affirmed, with costs against appellant. So ordered.

UMALI v. INTERMIDIATE APPELLATE COURT


This petition seeks the review on certiorari of the decision * dated 23 September 1982
of the respondent Court of Appeals in CA-G.R. SP No. 14504, affirming the Orders
dated 29 April 1982 and 24 June 1982 issued in Criminal Case No. 1423-I by the Court
of First Instance (CFI) of Zambales, Branch II (now Regional Trial Court, (RTC), Iba,
Zambales, Branch LXIX). ** The respondent court's decision ruled that the question
raised in Civil Case No. 8769 pending before the CFI of Quezon, Branch VIII (now RTC,
Quezon, Branch LVII) re: annulment/ rescission of the sale 1 is not prejudicial to the
issues involved in said CR No. 1423-I as to warrant the suspension of proceedings in
said criminal case.
The facts material to the present case, as found by the Court of Appeals, are as
follows:
... Petitioners are the officers of the Orosea Development Corporation, hereinafter
referred to simply as OROSEA. Sometime on September 4,1979, the petitioners, as
officers of OROSEA, purchased from the spouses Honorio and Solina Edano, Lot No. 49
of the Cadastral Survey of Mulanay, Bo. Casay, Mulanay, Province of Quezon, covered
by TCT No. RT-(T-36471), in the name of spouses Edano, for the sum of P1,036,500.00
payable in four installments, as follows:

1st Installment and downpayment - September 28, 1979 P225,000.00


2nd Installment - March 31, 1980 - 271,500.00

Persons Arts. 36-40 - 9

Acting on the "Motion to Suspend Arraignment and Further Proceedings," the Court of
First Instance of Zambales, Branch II, in said CR Case No. 1423-1 in its order dated 29
April 1982 3 denied the same for lack of merit; and the motion for reconsideration of
said order was likewise denied in the Order dated 24 June l982. 4

3rd Installment - September 30, 1980 - 270,000.00


4th Installment - March 31, 1981 - 270,000.00

issuing for this purpose four checks drawn against the Chartered Bank, Manila Branch.
The first check for P225,000.00 was honored upon its presentment.
By arrangement of the petitioners with the Edano spouses, a deed of absolute sale
was executed by the vendors, inspire of the fact that the purchase price has not yet
been Idly paid. Thus, TCT No. (T36471) was cancelled and a new transfer certificate of
title was issued in the name of OROSEA. Thereafter, OROSEA secured a loan of
P1,000,000.00 from the Philippine Veterans Bank using this property as security.
When the check for the second installment fell due, petitioners asked, for two times,
deferment of its presentation for payment, the first to June 30, 1980, and the second
to July 31, 1980. In the first deferment petitioners issued a check that matured on
June 30, 1980 to replace the check that matured on March 31, 1980. On the second
deferment petitioners issued another check dated July 31, 1980 to replace the check
dated June 30, 1980. This second renewal check was presented with the bank but it
was dishonored due to lack of funds. So were the checks postdated September 30,
1980 and March 31, 1981. They were also dishonored upon their presentment for lack
of funds. As a consequence of the dishonor of these checks, the Edano spouses filed a
complaint for estafa against petitioners. The information was filed by the Provincial
Fiscal against petitioners on May 21, 1981, and it was docketed as Criminal Case No.
1423-I. Arraignment was set on September 4, 1981 but petitioners failed to appear. It
was reset to October 5, 1981 but this was postponed upon motion of petitioners.
On October 14, 1981, OROSEA filed a Complaint in the Court of First Instance of
Quezon against the Edano spouses, docketed as Civil Case No. 8769, for the
annulment/rescission of the Contract of Sale executed on September 4, 1979 by and
between OROSEA and the Edano spouses covering Lot No. 49 of the Cadastral Survey
of Mulanay, and for which the petitioners issued the checks, subject of Criminal Case
No. 1423-1.
Criminal Case No. 1423-I was again set for arraignment on November 5, 1980. This
was postponed. With the entry of a new counsel, petitioners filed a motion to quash
Criminal Case No. 1423-I, on ground of improper venue, but this motion was
withdrawn by petitioners before it could be resolved. The arraignment was again set
for January 4, 1982 which was again postponed; then to February 5, 1982, again
postponed; then to March 23, 1982. However, before March 23, 1982, petitioners
filed, in Criminal Case No. 1423-I, a 'Motion to Suspend Arraignment and Further
Proceedings, with a Supplemental Motion To Suspend Proceedings'. This was opposed
by the Provincial Fiscal of Quezon. Resolving the motion to suspend, respondent Judge
issued his orders, now under question, denying the motion. 2

A petition for certiorari and prohibition, docketed as CA-G.R. SP No. 14504, was then
filed by herein petitioners with the respondent Court of Appeals. The appellate court,
resolving the said petition, rendered the now assailed decision dated 23 September
1982 affirming the questioned orders of the trial court and dismissed the petition for
lack of merit. The Court of Appeals ruled that, inasmuch as the issues in CV No. 8769
and CR No. 1423-I are completely different from each other, and that the resolution of
one is not necessary for the resolution of the other, the issue involved in CV No. 8769
is not a prejudicial question vis-a-vis the issue in CR No. 1423-I so as to warrant the
suspension of the proceedings in the latter case, until the termination of the civil
case. In its resolution dated 3 February 1983, the Court of Appeals also denied for lack
of merit the petitioners' motion for reconsideration of the said decision.
In this present recourse, the principal issue to be resolved, as in the Court of Appeals,
is whether CV No. 8769 involves a prejudicial question in relation to CR No. 1423-I so
as to require a suspension of proceedings in the latter case, until the civil case is
disposed of.
We find no merit in the petition.
In arguing that the principle of prejudicial question applies in the case at bar,
petitioners contend that, since in CV No. 8769 they seek to annul the deed of sale
executed in their favor by the private respondents, on the grounds that the latter
committed fraud in misrepresenting that the land they sold to petitioners is free from
all liens and encumbrances, and that it is not tenanted, when in truth and fact, as
petitioners later discovered, the land is covered by the land reform program and that
vast portions thereof are timber land, hence, allegedly indisposable public land,
therefore, according to petitioners, CV No. 8769 involves issues, the resolution of
which will determine whether or not petitioners are criminally liable in CR No. 1423-I.
They further argue that, if and when the court hearing CV No. 7869 annuls the subject
deed of sale, then, their obligation to pay private respondents under the said deed
would be extinguished, resulting in the dismissal of CR No. 1423-I.
Petitioners, therefore, in CV No. 8969, in seeking the annulment of the deed of sale on
the ground of fraud or misrepresentation, are in effect saying that said deed is
voidable, vitiated consent being one of the grounds mentioned in Article 1390 5 of the
Civil Code for voiding or annulling contracts. Indeed the well-settled rule is that a
contract where consent is vitiated is voidable. 6
It can not be denied, however, that at the time the acts complained of in CR No. 1423I were committed, the deed of sale sought to be later annulled in CV No. 8769 was
binding upon the parties thereto, including the petitioners. The two (2) essential
elements for a prejudicial question to exist are: (a) the civil action involves an issue
similar or intimately related to the issue raised in the criminal action; and (b) the
resolution of such issue in the civil action determines whether or not the criminal
action may proceed. 7

Persons Arts. 36-40 - 10

Given the nature of a prejudicial question, and considering the issues raised in CV No.
8769 and CR No. 1423-I, we agree with the ruling of the respondent Court of Appeals
that the resolution of the issues in CV No. 8769 is not determinative of the guilt or
innocence of the petitioners-accused in CR No. 1423-I, hence, no prejudicial question
is involved between the said two (2) cases.

1. x x x offer to sell [their] rights over a certain parcel of land, which is more
particularly described as follows:

As correctly observed by the appellate court, the issue in CR No. 1423-I is whether or
not the petitioners could be found guilty under Batas Pambansa Blg. 22 8 or under
Article 315, No. 2(d) of the Revised Penal Code. 9

2. x x x negotiate and enter into a contract for the consumation (sic) of sale of the
subject property; and to sign the same.

More specifically, what private respondents complained of in CR No. 1423-I is that the
checks issued by petitioners in their favor were dishonored for lack of funds upon due
presentment to the drawee bank. Undeniably, at the time of said dishonor,
petitioners' obligation to pay private respondents pursuant to the deed of sale,
continued to subsist. And because petitioners' checks were dishonored for lack of
funds, petitioners are answerable under the law for the consequences of their said
acts. And even if CV No. 8769 were to be finally adjudged to the effect that the said
deed of sale should be annulled, such declararion would be of no material importance
in the determination of the guilt or innocence of petitioners-accused in CR No. 1423-I.
WHEREFORE, the petition is DENIED. The decision dated 23 September 1982 of the
Court of Appeals in CA-GR SP No. 14504 is hereby AFFIRMED. SO ORDERED.

CHAM v. PIZARRO
Before this Court is an administrative complaint for disbarment filed by Wilson Po
Cham (complainant) against Atty. Edilberto D. Pizarro (respondent) for commission of
falsehood and misrepresentations in violation of a lawyers oath.
Complainant gives the following account of the facts that spawned the filing of the
present administrative complaint.
Sometime in July 1995, Emelita Caete (Caete), Elenita Alipio (Alipio), and now
deceased Mario Navarro (Navarro) who was then the Municipal Assessor of Morong,
Bataan, offered for sale to him a parcel of land with an area of approximately forty
(40) hectares, identified as Lot 1683 of Cad. Case No. 262, situated at Sitio Gatao,
Nagbalayong, Morong, Bataan (the property).
He having expressed interest in the offer, Caete and Navarro arranged a meeting
between him and respondent at the latters residence in Balanga, Bataan[1] where
respondent categorically represented to him that the property being offered for sale
was alienable and disposable.[2] Respondent in fact presented to him 1) Real Property
Tax Order of Payment[3] dated July 10, 1995 covering the property signed by Edna P.
Pizarro as Municipal Treasurer and Navarro as Municipal Assessor; 2) a Deed of
Absolute Sale[4] dated July 25, 1995 purportedly executed by the alleged previous
actual occupant of the property, one Jose R. Monzon (Monzon), transferring all his
rights, interest and possession thereover in favor of Virgilio Banzon (Banzon), Rolando
B. Zabala (Zabala) and respondent for an agreed consideration of P500,000.00; and 3)
Special Power of Attorney[5] dated July 25, 1995 executed by Banzon and Zabala
authorizing him (respondent) to:

AREA: 40 has. more or less situated at Pook Batangas, Nagbalayong, Morong, Bataan
covered by Tax Declaration No. 6066 PIN #108-08-044-05-126

3. xxx x receive proceeds thereof with obligation to distribute the corresponding share
of each co-owner;
x x x[6] (Underscoring supplied)
On July 25, 1995, he as buyer and respondent as seller executed an Option to Buy,[7]
the pertinent portions of which provide:
WHEREAS, the SELLER is the owner and Attorney-In-Fact of his co-owners of rights
with planted trees (improvements) containing an area of FORTY THREE (43) hectares,
situated in Pook Batangas, Nagbalayong, Morong, Bataan; (Portion of Lot 1683, Cad.
262, Morong Cadastre), covered by Tax Declaration 6066.
WHEREAS, the BUYER is interested to buy the same for a total price of THREE MILLION
AND SEVEN HUNDRED THOUSAND PESOS (P3,700,000.00) payable in two (2) gives
(sic), as follows:
a) Earnest money of P10,000.00 upon signing of this contract and the balance of full
payment within three (3) weeks from date hereof which offer the SELLER accepts;
NOW THEREFORE, for and in consideration of the foregoing premises and the terms
and conditions hereunder specified the parties have agreed on the following:
1) That the Buyer shall give an option money and earnest (sic) of P10,000.00 upon
signing of this contract, which shall form part of the contract price if and when the
buyer comply (sic) with his obligation to pay in full within three (3) weeks from date
hereof, otherwise should the BUYER fails (sic) to comply with his obligation to pay in
full on the scheduled period the P10,000.00 earnest money shall be forfeited in favor
of the SELLER and the Option to Buy is automatically cancelled.
2) That the SELLER upon full payment of the price shall execute a final Deed of Sale
and shall surrender all documents, plans and paper relative to the properties subject
of sale;
3) That the SELLER shall warrants (sic) their rights and claims over the above stated
properties including the trees planted on it as against the rights of third party except
that of the government.[8] (Emphasis and underscoring supplied)
In accordance with the terms of the Option to Buy, he paid respondent the amount of
P10,000.00 for which respondent issued the corresponding Receipt[9] reading:

Received the sum of TEN THOUSAND PESOS (P10,000.00) from MR. WILSON CHAM,
representing earnest/option money for Lot 1683 of Cad. Case No. 262 situated at
Boundaries:
NORTH : Right of Catalino Agujo
SOUTH : National Road-Bagac-Morong
WEST : Right of Nicasio Canta
EAST : Sapang Batang Panao
including the trees and improvement situated thereon.
Full payment shall be paid within three (3) weeks from date hereof.[10] (Underscoring
supplied)
On August 21, 1995, respondent executed a Deed of Absolute Sale[11] over the
property in his favor, the pertinent portions of which read as follows:
For and in consideration of the sum of THREE MILLION THREE HUNDRED SEVENTY
TWO THOUSAND FIVE HUNDRED THIRTY THREE (P3,372,533.00), Philippine Currency,
the receipt whereof is hereby acknowledged from the BUYER to the entire satisfaction
of the SELLERS, the said SELLERS do by these presents SELL, TRANSFER and CONVEY,
in manner absolute and irrevocable, in favor of the said BUYER, his heirs and assigns,
all their rights, interest and participation over that certain real estate destined for,
and in actual use as fruit land, situated at Pook Batangas, Nagbalayong, Morong,
Bataan and more particularly described as follows:
Location : Pook Batangas, Nagbalayong, Morong, Bataan
Area : That portion of Lot 1683, Cad. 262, Morong Cadastre, containing an area of
392,155 square meters more or less.
Boundaries : North : Right of Catalino Agujo

Persons Arts. 36-40 - 11

The SELLERS hereby agree with the BUYER that they are the absolute owners of the
rights over the said property; that they have the perfect right to convey the same;
that they acquired their rights over the said property by absolute deed of sale from
Jose R. Monzon who acquired his rights over the property from Marianito Holgado; that
Marianito Holgado acquired his right from Pedro de Leon who, in turn, acquired his
right from Julian Agujo who was the original owner who cleared the land and who was
in possession of the same immediately after the Second World War.

The SELLERS warrant their rights and claims over the aforedescribed real estate
including the trees planted thereon and they undertake to defend the same unto said
Vendee, his heirs and assigns against the claims of any third person whomsoever.[12]
(Emphasis and underscoring supplied)
Respondent thereafter furnished him with a copy of Tax Declaration No. 5010[13] with
Property Index No. 018-08-004-05-126 issued in his (respondents) name and his
alleged co-owners, and Real Property Tax Receipt No. 025201[14] dated August 17,
1995 issued in his (respondents) name.
He thus gave respondent two checks dated August 21, 1995 representing the
purchase price of the rights over the property, Asian Bank Corporation Check No.
GA063210[15] in the amount of P168,627.00 payable to respondent, and Asian Bank
Managers Check No. 004639GA[16] in the amount of P3,193,906.00 payable to
respondent, Banzon and Zabala.
He subsequently took possession of the property and installed a barbed wire fence at
its front portion. Soon after, however, a forest guard approached him and informed
him that the property could not be fenced as it was part of the Bataan National Park.
[17]
Upon investigation, he discovered that the property is not an alienable or disposable
land susceptible of private ownership. He thus secured a Certification[18] from the
Community Environment and Natural Resources Office (CENR) in Bagac, Bataan of the
Department of Environment and Natural Resources (DENR) dated July 2, 1998, signed
by CENR Officer Laurino D. Macadangdang, reading:
This pertains to your request for a certification as to the status of land claimed by
spouses Perfecto and Purificacion, Jose Monson, et. al, Virgilio Banzon and Edilberto
Pizarro, all located at Nagbalayong, Morong, Bataan.

South : National Road, Bagac-Morong


West : Right of Nicasio Canta
East : Sapang Batang Panao
The SELLERS do hereby declare that the boundaries of the foregoing land are visible
by means of monuments, creeks and trees; that the land including the permanent
improvements existing thereon consist of fruit-bearing trees assessed for the current
year at TWO HUNDRED SIXTY TWO THOUSAND FOUR HUNDRED P262,400.00 as per
Tax Declaration No. 5010; and that the property is presently in the possession of the
SELLERS.

Please be informed that per verification conducted by the personnel of this Office,
said lands fall within the Bataan Natural Park per L.C. Map/N.P. Map No. 34 as certified
on December 1, 1945. Under the Public Land Law, lands within this category are not
subject for disposition.[19] (Underscoring supplied)
He also obtained a Letter-directive[20] dated August 31, 1995 issued by Officer-inCharge Ricardo R. Alarcon of the Provincial Environment and Natural Resources Office
(PENR) of Balanga, Bataan to the Municipal Assessor, the pertinent portions of which
read:
Please be informed that it comes to our attention that there are some forest
occupants that are securing land tax declarations from your office in (sic) the pretext

that the area they occupied (sic) were (sic) within alienable and disposable lands.
Presently, this tax declaration is being used in the illegal selling of right [of]
possession within the Bataan Natural Park which is prohibited under our laws.
xxx
In this regard, I would like to request for your assistance by way of informing us and in
controlling this land rush and massive selling and buying of rights of possession within
prohibited areas as stated above.[21] (Emphasis and underscoring supplied)
Upon his request, the PENR issued a Certification[22] dated March 14, 1996 stating
that those named by respondent as prior owners of rights over the property from
whom respondent and his alleged co-owners acquired their alleged rights were not
among those inventoried as occupants per the PENRs 1978 to 1994 Forest Occupancy
Census (IFO) Survey.
Despite repeated demands, respondent refused to return the purchase price of the
rights over the property.[23]
In his present complaint[24] dated September 10, 2001, complainant charges
respondent to have violated his oath as a member of the Bar in committing manifest
falsehood and evident misrepresentation by employing fraudulent means to lure him
into buying rights over the property which property he represented to be disposable
and alienable.[25]
In his Comment[26] dated January 12, 2002, respondent denied having employed
deceit or having pretended to co-own rights over the property or having represented
that it was alienable and disposable. He claimed that complainant, being engaged in
speculation in the purchase of property, knew exactly the character and nature of the
object of his purchase;[27] and that despite complainants awareness that he was
merely buying rights to forest land, he just the same voluntarily entered into the
transaction because of the propertys proximity to the Subic Bay Economic Zone.
Respondent surmised that complainant bought the rights over the property in the
hope that lands belonging to the public domain in Morong would be eventually
declared alienable and disposable to meet the rising demand for economic zones.[28]
By Resolution[29] of February 6, 2002, this Court referred the case to the Integrated
Bar of the Philippines (IBP) for investigation, report and recommendation or decision
within ninety (90) days from notice.
On May 6, 2002, complainant filed before the IBP his Reply[30] to respondents
Comment, maintaining that the sale of rights over the property was attended with
deceit as respondent deliberately did not disclose that the property was within the
confines of the Bataan National Park.[31] And he denied being engaged in
speculation, he claiming that with his purchase of the property, he would venture into
low-cost housing for the employees of the nearby Subic Bay area.[32]
To complainants Reply, respondent filed his Rejoinder on June 21, 2002.[33]

Persons Arts. 36-40 - 12

Complainant later filed his Affidavit[34] and Position Paper[35] on June 21, 2002 and
September 17, 2001, respectively, reiterating his assertions in his previous pleadings.

The record shows that complainant filed a criminal complaint for estafa against
respondent, Banzon, Zabala, Caete, Alipio and Navarro in 1999[36] arising from the
questioned sale of rights. The complaint was twice dismissed by the City Prosecutor of
Quezon City. On petition for review, however, the Department of Justice, through then
Secretary Hernando B. Perez, by Resolution[37] of March 6, 2002, reversed the
dismissal of the complaint as it found probable cause to indict respondent et al. in
court. An information for estafa was thereupon filed against respondent et al. before
the Regional Trial Court (RTC) of Quezon City, docketed as Criminal Case No. Q-0094232.
By Report and Recommendation of April 20, 2004, the IBP Commission on Bar
Discipline (CBD), through Commissioner Lydia A. Navarro, finding respondent to have
violated his oath as a member of the Bar to do no falsehood and misrepresentations,
recommended his suspension from the practice of law for three (3) months, subject to
the approval of the members of the Board of Governors. Pertinent portions of the
Report and Recommendation read:
. . . [I]t is evident that as early as of (sic) 1992, the Implementing Rules and
Regulations of NIPAS ACT[38] prohibited the illegal selling of rights or possession of
the areas occupied within the Bataan Natural Park, the subject property not excluded
as per letter of OIC CENRO Laurino D. Mapadanig [illegible], Bagac, Bataan per L.C.
map/N.P. Map No. 34 to the Municipal Assessor therein and certified on December 1,
1945 that subject property which is within this category was not subject for
disposition; a fact supposed to be known by the respondent being a resident of
Balanga, Bataan and was in the practice of his profession also in said area.
Aside from the fact that the alleged original owner Monzon was not among those
inventoried occupants as per Forest Occupancy (IFO) Survey since 1978 up to the
latest census in 1994 from whom respondent allegedly bought the subject property;
the Absolute Deed of Sale executed between the complainant Wilson Po Cham and
the respondent relative to the same subject property was not notarized which partook
the nature of a private and not official document.
Although respondent furnished complainant the foregoing documents to prove their
rights, interest and possession to the subject property, respondent and his co-owners
failed to show a permit from the government conferring upon them rights or
concessions over the subject property, which formed part of the Bataan Natural Park
classified as public and not subject to disposition, therefore respondent and his coowners have no rights and interests whatsoever over the subject property and their
representations to complainant were simply not true but a falsehood.
Respondent being extensively conversant and knowledgeable about the law took
advantage of his versatility in the practice of law and committed misrepresentations
that he and his co-owners have irrevocable rights, interests and possession over the
subject property which convinced complainant into purchasing subject property
unmindful that the same is not alienable or disposable being a portion of the public
domain; whereby respondent violated his solemn oath as member of the Philippine
Bar for having committed such falsehood and misrepresentations to the complainant.
[39] (Underscoring supplied).

Persons Arts. 36-40 - 13

By CBD Resolution No. XVI-2004-407 of October 7, 2004, the IBP Board of Governors
adopted and approved the April 20, 2004 Committee Report and Recommendation.

the PENR in its earlier-quoted portion of its letter-directive to the Balanga Municipal
Assessor that the area occupied . . . [is] within alienable and disposable land.

The case was forwarded to this Court for final action pursuant to Rule 139-B of the
Rules of Court.[40]

Respondent must thus be faulted for fraudulently inducing complainant to purchase,


for P3,372,533.00, non-existent irrevocable rights, interest and participation over an
inalienable property.

The IBP findings are well-taken.


The Bar is enjoined to maintain a high standard of not only legal proficiency but of
honesty and fair dealing.[41] Thus, a member should refrain from doing any act which
might lessen in any degree the confidence and trust reposed by the public in the
fidelity, honesty and integrity of the legal profession.[42]
The misconduct of a lawyer, whether in his professional or private capacity, which
shows him to be wanting in moral character, honesty, probity and good demeanor to
thus render him unworthy of the privileges which his license and the law confer upon
him, may be sanctioned with disbarment or suspension.[43]
Thus, under Section 27, Rule 138 of the Revised Rules of Court, a member of the Bar
may be disbarred or suspended from his office as attorney on the following grounds:
1) deceit; 2) malpractice or other gross misconduct in office; 3) grossly immoral
conduct; 4) conviction of a crime involving moral turpitude; 5) violation of the lawyers
oath; 6) willful disobedience to any lawful order of a superior court; and 7) willfully
appearing as an attorney for a party without authority.
And he may be faulted under Canon 1 of the Code of Professional Responsibility which
mandates a member of the Bar to obey the laws of the land and promote respect for
the law. Rule 1.01 of the Code specifically enjoins him not to engage in unlawful,
dishonest, immoral or deceitful conduct. Conduct, as used in this rule, is not limited to
conduct exhibited in connection with the performance of professional duties.[44]
In the case at bar, as reflected above, complainant presented certifications from the
DENR that the property is part of the public domain and not disposable as it is within
the Bataan National Park. Indeed, by virtue of Proclamation No. 24[45] issued on
December 1, 1945, all properties of the public domain therein designated as part of
the Bataan National Park were withdrawn from sale, settlement or other disposition,
subject to private rights.
On the other hand, respondent has utterly failed to substantiate his documented
claim of having irrevocable rights and interests over the property which he could have
conveyed to complainant. E.g., he could have presented any document issued by the
government conferring upon him and his alleged co-owners, or even upon his alleged
predecessors-in-interest, with any such right or interest, but he presented none. He
merely presented a Deed of Absolute Sale purportedly executed by a certain Jose R.
Monzon in his, Banzons and Zabalas favor on July 25, 1995, a month shy of the
execution on August 21, 1995 of the Deed of Absolute Sale in favor of complainant.
The tax declaration and receipt which respondent presented do not help his cause any
as neither tax receipts nor realty tax declarations are sufficient evidence of the right
of possession over realty unless supported by other effective proof.[46] The
presentation of a tax declaration must indeed have been a pretext, as observed by

In Lizaso v. Amante[47] where therein respondent lawyer enticed the therein


complainant to invest in the casino business with the proposition that her investment
would yield her substantial profit, but therein respondent not only failed to deliver the
promised return on the investment but also the principal thereof, this Court took
occasion to expound on sanctioning lawyers for committing fraud, deceit or falsehood
in their private dealings:
It is true, of course, that there was no attorney-client relationship between respondent
Amante and complainant Cuyugan-Lizaso. The transaction that complainant entered
into with respondent did not require respondent to perform professional legal services
for complainant nor did that transaction relate to the rendition of professional services
by respondent to any other person.
As early as 1923, however, the Court laid down in In Re Vicente Pelaez the principle
that it can exercise its power to discipline lawyers for causes which do not involve the
relationship of an attorney and client. x x x
x x x [A]s a general rule, a court will not assume jurisdiction to discipline one of its
officers for misconduct alleged to have been committed in his private capacity. But
this is a general rule with many exceptions. The courts sometimes stress the point
that the attorney has shown, through misconduct outside of his professional dealings,
a want of such professional honesty as render him unworthy of public confidence, and
an unfit and unsafe person to manage the legal business of others. The reason why
such a distinction can be drawn is because it is the court which admits an attorney to
the bar, and the court requires for such admission the possession of a good moral
character.
xxx
The rationale of the rule that misconduct, indicative of moral unfitness, whether
relating to professional or non-professional matters, justifies suspension or
disbarment, was expressed by Mr. Chief Justice Prentice in In Re Disbarment of Peck,
with eloquence and restraint:
As important as it is that an attorney be competent to deal with the oftentimes
intricate matters which may be intrusted to him, it is infinitely more so that he be
upright and trustworthy. Unfortunately, it is not easy to limit membership in the
profession to those who satisfy the standard of test of fitness. But scant progress in
that direction can be hoped for if, in the determination of the qualification of
professional fitness, non-professional dishonor and dishonesty in whatsoever path of
life is to be ignored. Professional honesty and honor are not to be expected as the
accompaniment of dishonesty and dishonor in other relations. x x x misconduct,
indicative of moral unfitness for the profession, whether it be professional or nonprofessional, justifies dismission as well as exclusion from the bar.

The rule in this jurisdiction was stated by Mr. Justice Malcolm in Piatt v. Abordo x xx:
The courts are not curators of the morals of the bar. At the same time the profession
is not compelled to harbor all persons whatever their character, who are fortunate
enough to keep out of prison. As good character is an essential qualification for
admission of an attorney to practice, when the attorneys character is bad in such
respects as to show that he is unsafe and unfit to be entrusted with the powers of an
attorney, the courts retain the power to discipline him.[48] (Italics in the original)
This Lizaso ruling was reiterated in Co v. Bernardino[49] and Lao v. Medel.[50]
To be sure, complainant is not entirely blameless. Had he exhibited a modicum of
prudence before entering into the transaction with respondent, he would have spared
himself from respondents sham.
It is jurisprudentially established though that in a disbarment proceeding, it is
immaterial that the complainant is not blameless or is in pari delicto as this is not a
proceeding to grant relief to the complainant, but one to purge the law profession of
unworthy members to protect the public and the courts.[51]
The record does not disclose the status of the estafa case against respondent. His
conviction or acquittal is not, however, essential insofar as the present administrative
case against him is concerned.[52]
Administrative cases against lawyers belong to a class of their own. They are distinct
from and they may proceed independently of x x x criminal cases.
The burden of proof for these types of cases differ. In a criminal case, proof beyond
reasonable doubt is necessary; in an administrative case for disbarment or
suspension, clearly preponderant evidence is all that is required. Thus, a criminal
prosecution will not constitute a prejudicial question even if the same facts and
circumstances are attendant in the administrative proceedings.
It should be emphasized that a finding of guilt in the criminal case will not necessarily
result in a finding of liability in the administrative case. Conversely, respondents
acquittal does not necessarily exculpate him administratively.[53] (Emphasis supplied)
It is not thus sound judicial policy to await the final resolution of a criminal case
before a complaint against a lawyer may be acted upon; otherwise, this Court will be
rendered helpless from vigorously applying the rules on admission to and continuing
membership in the legal profession during the whole period that the criminal case is
pending final disposition when the objectives of the two proceedings are vastly
disparate.[54]
While the facts and circumstances of the case do not warrant the imposition of so
severe a penalty as disbarment, the inherent power of this Court to discipline an
errant member of the Bar must, nonetheless, be exercised as it cannot be denied that
respondent violated his solemn oath as a lawyer not to engage in unlawful, dishonest
or deceitful conduct.[55]

Persons Arts. 36-40 - 14

The penalty of suspension for three (3) months recommended by the IBP is not,
however, commensurate to the gravity of the wrong committed by respondent. This
Court finds that respondents suspension from the practice of law for One (1) Year is
warranted.
WHEREFORE, respondent, Atty. Edilberto D. Pizarro, is SUSPENDED from the practice
of law for One (1) Year and STERNLY WARNED that a repetition of the same or similar
offense will merit a more severe penalty.
Let copies of this Decision be entered in the personal record of respondent as a
member of the Bar and furnished the Office of the Bar Confidant, the Integrated Bar of
the Philippines, and the Court Administrator for circulation to all courts of the country.
SO ORDERED.

ART 38 & 39 CIVIL CODE; LIMITATIONS AND RESTRICTIONS ON


CAPACITY TO ACT
YAP v. GRAGEDA
We are asked in this petition to review the amended decision of the respondent court
which declared as absolutely null and void the sale of a residential lot in Guinobatan,
Albay to a Chinese national and ordered its reconveyance to the vendors thirty years
after the sale inspite of the fact that the vendee had been a naturalized Filipino citizen
for fifteen years at the time.
We grant the petition. The questioned decision and the order amending it are
reversed and set aside.
The facts are not disputed.
On April 12, 1939, Maximino Rico, for and in his own behalf and that of the minors
Maria Rico, Filomeno Rico, Prisco Rico, and Lourdes' Rico, executed a Deed of Absolute
Sale (Annex 'A' to the complaint) over Lot 339 and a portion of Lot 327 in favor of the
petitioner Donato Reyes Yap who was then a Chinese national. Respondent Jose A.
Rico is the eldest son of Maximino Rico, one of the vendors in Annex 'A'.
Subsequently, the petitioner as vendee caused the registration of the instrument of
sale and the cancellation of Original Certificates of Title Nos. 29332 and 29410 and
the consequent issuance in his favor of Transfer Certificate of Title No. T-2433
covering the two lots subject matter of the Contract of Sale.
After the lapse of nearly fifteen years from and after the execution of the deed of
absolute sale, Donato Reyes Yap was admitted as a Filipino citizen and allowed to take
his oath of allegiance to the Republic of the Philippines. He was, thereafter, issued
Certificate of Naturalization No. 7, File No. 19 of the Court of First Instance of Albay.
On December 1, 1967, the petitioner ceded the major portion of Lot No. 327
consisting of 1,078 square meters which he acquired by purchase under the deed of
sale in favor of his engineer son, Felix Yap, who was also a Filipino citizen because of

the Filipino citizenship of his mother and the naturalization of his father Donato Reyes
Yap.
Subsequently, Lourdes Rico, aunt and co-heir of respondent Jose A. Rico. sold the
remaining portion of Lot 327 to the petitioner who had his rights thereon duly
registered under Act 496. Petitioner, Donato Reyes Yap, has been in possession of the
lots in question since 1939, openly, publicly, continuously, and adversely in the
concept of owner until the present time. The petitioner has one surviving son by his
first marriage to a Filipino wife. He has five children by his second marriage also to a
Filipina and has a total of 23 grandchildren all of whom are Filipino citizens.
The respondent court considered Section 5, Article XIII of the 1935 Constitution that
"no private agricultural land shall be transferred or assigned except to individuals,
corporations, or associations qualified to acquire or hold lands of the public domain in
the Philippines" to be an absolute and unqualified prohibition and, therefore, ruled
that a conveyance contrary to it would not be validated nor its void nature altered by
the subsequent naturalization of the vendee.
The dispositive portion of the amended decision reads:
WHEREFORE, in view of all the foregoing, the Contract of Sale embodied in the
'Escritura de Compra Venta' which is attached to the Complaint as Annex 'A', is
hereby declared null and void ab initio and without any legal force and effect.
The action to recover Lot 339 of the Cadastral Survey of Guinobatan, Albay, covered
by Transfer Certificate of Title No. T2433. and Lot 327 covered by the same Transfer
Certificate of Title, is hereby granted to plaintiff, upon payment of the consideration
price of P150.00 and declaring plaintiff as the lawful owner and entitled to the
possession thereof.
Defendant Donato Reyes Yap is hereby ordered to produce his Transfer Certificate of
Title No. T-2433 to the Register of Deeds of Albay, so as to enable said office to make
the due and proper annotations on said title as well as in the original of the
declaration of nullity as herein adjudged. Let Transfer Certificate of Title issued to
plaintiff, concerning said Lots 339 and 327 of the Cadastral Survey of Guinobatan,
Albay.
COSTS AGAINST DEFENDANTS.
The rulings in Vasquez v.Leng Seng Giap et al. (96 Phil. 447) and Sarosa Vda. de
Bersabia v. Cuenco (113 SCRA 547) sustain the petitioner's contentions. We stated in
Sarosa Vda de Bersabia:
There should be no question that the sale of the land in question in 1936 by Epifania
to Ong King Po was inexistent and void from the beginning (Art. 1409 [7], Civil Code)
because it was a contract executed against the mandatory provision of the 1935
Constitution, which is an expression of public policy to conserve lands for the Filipinos.
Said provision reads:

Persons Arts. 36-40 - 15

Save in cases of hereditary succession, no private agricultural land shall be


transferred or assigned except to in. individuals, corporations, or associations,
qualified to acquire or hold lands of the public domain.
Had this been a suit between Epifania and Ong King Po she could have been declared
entitled to the litigated land on the basis, as claimed, of the ruling in Philippine
Banking Corporation vs. Lui She, reading:
... For another thing, and this is not only cogent but also important. Article 1416 of the
Civil Code provides as an exception to the rule on pari delicto that when the
agreement is not illegal per se but is merely prohibited, and the prohibition by the law
is designed for the protection of the plaintiff, he may, if public policy is thereby
enhanced, recover what he has sold or delivered. ...

But the factual set-up has changed. The litigated property is now in the hands of a
naturalized Filipino. It is no longer owned by a disqualified vendee. Respondent, as a
naturalized citizen, was constitutionally qualified to own the subject property. There
would be no more public policy to be served in allowing petitioner Epifania to recover
the land as it is already in the hands of a qualified person. Applying by analogy the
ruling of this Court in Vasquez vs. Giap and Leng Seng Giap & Sons:
... if the ban on aliens from acquiring not only agricultural but also urban lands, as
construed by this Court in the Krivenko case, is to preserve the nation's lands for
future generations of Filipinos, that aim or purpose would not be thwarted but
achieved by making lawful the acquisition of real estate by aliens who became Filipino
citizens by naturalization.
Only recently, we had occasion to reiterate the above rulings in Vicente Godines v.
Fong Pak Luen, et al. (G.R. No. L-36731, January 27, 1983).
WHEREFORE, the amended judgment of the respondent court is hereby REVERSED
and SET ASIDE. The complaint is DISMISSED. SO ORDERED.

GODINEZ v. FONG PAK LUEN et al


The plaintiffs filed this case to recover a parcel of land sold by their father, now
deceased, to Fong Pak Luen, an alien, on the ground that the sale was null and void
ab initio since it violates applicable provisions of the Constitution and the Civil Code.
The order of the Court of First Instance of Sulu dismissing the complaint was appealed
to the Court of Appeals but the latter court certified the appeal to us since only pure
questions of law were raised by the appellants.
The facts of the case were summarized by the Court of Appeals as follows:
On September 30, 1966, the plaintiffs filed a complaint in the Court of First Instance of
Sulu alleging among others that they are the heirs of Jose Godinez who was married
to Martina Alvarez Godinez sometime in 1910; that during the marriage of their
parents the said parents acquired a parcel of land lot No. 94 of Jolo townsite with an
area of 3,665 square meters as evidenced by Original Certificate of Title No. 179 (D

-155) in the name of Jose Godinez; that their mother died sometime in 1938 leaving
the plaintiffs as their sole surviving heirs; that on November 27, 1941, without the
knowledge of the plaintiffs, the said Jose Godinez, for valuable consideration, sold the
aforesaid parcel of land to the defendant Fong Pak Luen, a Chinese citizen, which
transaction is contrary to law and in violation of the Civil Code because the latter
being an alien who is inhibited by law to purchase real property; that Transfer
Certificate Title No. 884 was then issued by the Register of Deeds to the said
defendant, which is null and void ab initio since the transaction constituted a nonexistent contract; that on January 11, 1963, said defendant Fong Pak Luen executed a
power of attorney in favor of his co-defendant Kwan Pun Ming, also an alien, who
conveyed and sold the above described parcel of land to co-defendant Trinidad S.
Navata, who is aware of and with full knowledge that Fong Pak Luen is a Chinese
citizen as well as Kwan Pun Ming, who under the law are prohibited and disqualified to
acquire real property in this jurisdiction; that defendant Fong Pak Luen has not
acquired any title or interest in said parcel of land as the purported contract of sale
executed by Jose Godinez alone was contrary to law and considered non- existent, so
much so that the alleged attorney-in-fact, defendant Kwan Pun Ming had not
conveyed any title or interest over said property and defendant Navata had not
acquired anything from said grantor and as a consequence Transfer Certificate of Title
No. 1322, which was issued by the Register of Deeds in favor of the latter is null and
void ab initio,- that since one-half of the said property is conjugal property inherited
by the plaintiffs from their mother, Jose Godinez could -not have legally conveyed the
entire property; that notwithstanding repeated demands on said defendant to
surrender to plaintiffs the said property she refused and still refuses to do so to the
great damage and prejudice of the plaintiffs; and that they were constrained to
engage the services of counsel in the sum of P2,000.00.1wph1.t The plaintiffs
thus pray that they be adjudged as the owners of the parcel of land in question and
that Transfer Certificate of Title RT-90 (T-884) issued in the name of defendant Fong
Pak Luen be declared null and void ab initio; and that the power of attorney issued in
the name of Kwan Pun Ming, as well as Transfer Certificate of Title No. 'L322 issued in
the name of defendant Navata be likewise declared null and void, with costs against
defendants.
On August 18, 1966, the defendant Register of Deeds filed an answer claiming that he
was not yet the register of deeds then; that it was only the ministerial duty of his
office to issue the title in favor of the defendant Navata once he was determined the
registerability of the documents presented to his office.
On October 20, 1966, the defendant Navata filed her answer with the affirmative
defenses and counterclaim alleging among others that the complaint does not state a
cause of action since it appears from the allegation that the property is registered in
the name of Jose Godinez so that as his sole property he may dispose of the same;
that the cause of action has been barred by the statute of limitations as the alleged
document of sale executed by Jose Godinez on November 27, 1941, conveyed the
property to defendant Fong Pak Luen as a result of which a title was issued to said
defendant; that under Article 1144 (1) of the Civil Code, an action based upon a
written contract must be brought within 10 years from the time the right of action
accrues; that the right of action accrued on November 27, 1941 but the complaint
was filed only on September 30, 1966, beyond the 10 year period provided for by law;
that the torrens title in the name of defendant Navata is indefeasible who acquired
the property from defendant Fong Pak Luen who had been in possession of the
property since 1941 and thereafter defendant Navata had possessed the same for the
last 25 years including the possession of Fong Pak Luen; that the complaint is

Persons Arts. 36-40 - 16

intended to harass the defendant as a civic leader and respectable member of the
community as a result of which she suffered moral damages of P100,000.00,
P2,500.00 for attorney's fees and P500.00 expenses of litigation, hence, said
defendant prays that the complaint be dismissed and that her counterclaim be
granted, with costs against the plaintiffs. On November 24, 1967, the plaintiffs filed
an answer to the affirmative defenses and counter-claim. As the defendants Fong Pak
Luen and Kwan Pun Ming are residing outside the Philippines, the trial court upon
motion issued an order of April 17, 1967, for the service of summons on said
defendants by publication. No answer has been filed by said defendants.
On December 2, 196 7, the court issued an order as follows:
Both parties having agreed to the suggestion of the Court that they submit their
supplemental pleadings to support both motion and opposition and after submittal of
the same the said motion to dismiss which is an affirmative defense alleged in the
complaint is deemed submitted. Failure of both parties or either party to submit their
supplemental pleadings on or about December 9, the Court will resolve the case.
On November 29, 1968, the trial court issued an order missing the complaint without
pronouncement as to costs. (Record on Appeal, pp. 31- 37). A motion for
reconsideration of this order was filed by the plaintiffs on December 12, 196F, which
was denied by the trial court in an order of July 11, 1969, (Rec. on Appeal, pp. 38, 43,
45, 47). The plaintiffs now interpose this appeal with the following assignments of
errors:

I.
The trial court erred in dismissing plaintiffs-appellants' complaint on the ground
of prescription of action, applying Art. 1144 (1) New Civil Code on the basis of
defendant Trinidad S. Navata's affirmative defense of prescription in her answer
treated as a motion to dismiss.
II.
The trial court erred in denying plaintiffs-appellants' motion for reconsideration of
the order of dismissal.
III.

The trial court erred in not ordering this case to be tried on the merits."

The appellants contend that the lower court erred in dismissing the complaint on the
ground that their cause of action has prescribed. While the issue raised appears to be
only the applicability of the law governing prescription, the real question before us is
whether or not the heirs of a person who sold a parcel of land to an alien in violation
of a constitutional prohibition may recover the property if it had, in the meantime,
been conveyed to a Filipino citizen qualified to own and possess it.
The question is not a novel one. Judicial precedents indicate fairly clearly how the
question should be resolved.
There can be no dispute that the sale in 1941 by Jose Godinez of his residential lot
acquired from the Bureau of Lands as part of the Jolo townsite to Fong Pak Luen, a
Chinese citizen residing in Hongkong, was violative of Section 5, Article XIII of the
1935 Constitution which provided:

Sec. 5. Save in cases of hereditary succession, no private agricultural land will be


transferred or assigned except to individuals, corporations, or associations qualified to
acquire or hold lands of the public domain in the Philippines.
The meaning of the above provision was fully discussed in Krivenko v. Register of
Deeds of Manila (79 Phil. 461) which also detailed the evolution of the provision in the
public land laws, Act No. 2874 and Commonwealth Act No. 141. The Krivenko ruling
that "under the Constitution aliens may not acquire private or agricultural lands,
including residential lands" is a declaration of an imperative constitutional policy.
Consequently, prescription may never be invoked to defend that which the
Constitution prohibits. However, we see no necessity from the facts of this case to
pass upon the nature of the contract of sale executed by Jose Godinez and Fong Pak
Luen whether void ab initio, illegal per se or merely pro-exhibited.** It is enough to
stress that insofar as the vendee is concerned, prescription is unavailing. But neither
can the vendor or his heirs rely on an argument based on imprescriptibility because
the land sold in 1941 is now in the hands of a Filipino citizen against whom the
constitutional prescription was never intended to apply. The lower court erred in
treating the case as one involving simply the application of the statute of limitations.
From the fact that prescription may not be used to defend a contract which the
Constitution prohibits, it does not necessarily follow that the appellants may be
allowed to recover the property sold to an alien. As earlier mentioned, Fong Pak Luen,
the disqualified alien vendee later sold the same property to Trinidad S. Navata, a
Filipino citizen qualified to acquire real property.
In Vasquez v. Li Seng Giap and Li Seng Giap & Sons (96 Phil. 447), where the alien
vendee later sold the property to a Filipino corporation, this Court, in affirming a
judgment dismissing the complaint to rescind the sale of real property to the
defendant Li Seng Giap on January 22, 1940, on the ground that the vendee was an
alien and under the Constitution incapable to own and hold title to lands, held:
In Caoile vs. Yu Chiao 49 Qff Gaz., 4321; Talento vs. Makiki 49 Off. Gaz., 4331;
Bautista vs. Uy 49 Off. Gaz., 4336; Rellosa vs. Gaw Chee 49 Off. Gaz., 4345 and
Mercado vs. Go Bio, 49 Off. Gaz., 5360, the majority of this Court has ruled that in
sales of real estate to aliens incapable of holding title thereto by virtue of the
provisions of the Constitution (Section 5, Article XIII Krivenko vs. Register of Deeds, 44
Off. Gaz., 471) both the vendor and the vendee are deemed to have committed the
constitutional violation and being thus in pari delicto the courts will not afford
protection to either party. (Article 1305, old Civil Code; Article 1411, new Civil Code)
From this ruling three Justices dissented. (Mr. Justice Pablo, Mr. Justice Alex. Reyes and
the writer. See Caoile vs. Yu Chiao Talento vs. Makiki Bautista us. Uy, Rellosa vs. Gaw
Chee and Mercado vs. Go Bio). supra.
The action is not of rescission because it is not postulated upon any of the grounds
provided for in Article 1291 of the old Civil Code and because the action of rescission
involves lesion or damage and seeks to repair it. It is an action for annulment under
Chapter VI, Title II, Book 11, on nullity of contracts, based on a defect in the contract
which invalidates it independently of such lesion or damages. (Manresa,
Commentarios al Codigo Civil Espanol Vol. VIII, p. 698, 4th ed.) It is very likely that the
majority of this Court proceeded upon that theory when it applied the in pari delicto
rule referred to above.

Persons Arts. 36-40 - 17

In the United States the rule is that in a sale of real estate to an alien disqualified to
hold title thereto the vendor divests himself of the title to such real estate and has no
recourse against the vendee despite the latter's disability on account of alienage to
hold title to such real estate and the vendee may hold it against the whole world
except as against the State. It is only the State that is entitled by proceedings in the
nature of office found to have a forfeiture or escheat declared against the vendee who
is incapable of holding title to the real estate sold and conveyed to him. Abrams vs.
State, 88 Pac. 327; Craig vs. Leslie et al., 4 Law, Ed. 460; 3 Wheat, 563, 589590; Cross
vs. Del Valle, 1 Wall, [U.S.] 513; 17 Law. Ed., 515; Governeur vs. Robertson, 11 Wheat,
332, 6 Law. Ed., 488.)

However, if the State does not commence such proceedings and in the meantime the
alien becomes naturalized citizen, the State is deemed to have waived its right to
escheat the real property and the title of the alien thereto becomes lawful and valid
as of the date of its conveyance or transfer to him. (Osterman vs. Baldwin, 6 Wall,
116, 18 Law. ed. 730; Manuel vs. Wulff, 152 U.S. 505, 38 Law. ed. 532; Pembroke vs.
Houston, 79, SW 470; Fioerella vs. Jones, 259 SW 782. The rule in the United States
that in a sale of real estate to an alien disqualified to hold title thereto, the vendor
divests himself of the title to such real estate and is not permitted to sue for the
annulment Of his Contract, is also the rule under the Civil Code. ... Article 1302 of the
old Civil Code provides: ... Persons sui juris cannot, however, avail themselves of the
incapacity of those with whom they contracted; ...
xxx xxx

xxx

. . . (I)f the ban on aliens from acquiring not only agricultural but, also urban lands, as
construed by this Court in the Krivenko case, is to preserve the nation's land for future
generations of Filipinos, that aim or purpose would not be thwarted but achieved by
making lawful the acquisition of real estate by aliens who became Filipino citizens by
naturalization. The title to the parcel of land of the vendee, a naturalized Filipino
citizen, being valid that of the domestic corporation to which the parcel of land has
been transferred, must also be valid, 96.67 per cent of its capital stock being owned
by Filipinos.
Herrera v. Luy Kim Guan (SCRA 406) reiterated the above ruling by declaring that
where land is sold to a Chinese citizen, who later sold it to a Filipino, the sale to the
latter cannot be impugned.
The appellants cannot find solace from Philippine Banking Corporation v. Lui She (21
SCRA 52) which relaxed the pari delicto doctrine to allow the heirs or successors-ininterest, in appropriate cases, to recover that which their predecessors sold to aliens.
Only recently, in Sarsosa vda. de Barsobia v. Cuenco (113 SCRA 547) we had occasion
to pass upon a factual situation substantially similar to the one in the instant case. We
ruled:
But the factual set-up has changed. The litigated property is now in the hands of a
naturalized Filipino. It is no longer owned by a disqualified vendee. Respondent, as a
naturalized citizen, was constitutionally qualified to own the subject property. There
would be no more public policy to be served in allowing petitioner Epifania to recover

the land as it is already in the hands of a qualified person. Applying by analogy the
ruling of this Court in Vasquez vs. Giap & Sons: (.96 Phil. 447 [1955])
... if the ban on aliens from acquiring not only agricultural but also urban lands, as
construed by this Court in the Krivenko case, is to preserve the nation's lands for
future generations of Filipinos, that aim or purpose would not be thwarted but
achieved by making lawful the acquisition of real estate by aliens who became Filipino
citizens by naturalization.
While, strictly speaking, Ong King Po, private respondent's vendor, had no rights of
ownership to transmit, it is likewise in escapable that petitioner Epifania had slept on
her rights for 26 years from 1936 to 1962. By her long inaction or inexcusable
neglect, she should be held barred from asserting her claim to the litigated property
(Sotto vs. Teves, 86 SCRA 157 [1978])
Laches has been defined as the failure or neglect, for an unreasonable and
unexplained length of time, to do that which by exercising due diligence could or
should have been done earlier; it is negligence or ommission to assert a right within a
reasonable time, warranting a presumption that the party entitled to assert it either
has abandoned it or declined to assert it. (Tijam, et al. vs. Sibonghanoy, et al., No. L21450, April 15, 1968, 23 SCRA 29, 35).' (Cited in Sotto vs. Teves, 86 SCRA 154
[1978]).
Respondent, therefore, must be declared to be the rightful owner of the property.
In the light of the above considerations, we find the second and third assignments of
errors without merit. Respondent Navata, the titled owner of the property is declared
the rightful owner.
WHEREFORE, the instant appeal is hereby denied. The orders dismissing the
complaint and denying the motion for reconsideration are affirmed. SO ORDERED.

ART 40; PERSONALITY FROM BIRTH


GELUZ v. CA
This petition for certiorari brings up for review question whether the husband of a
woman, who voluntarily procured her abortion, could recover damages from physician
who caused the same.
The litigation was commenced in the Court of First Instance of Manila by respondent
Oscar Lazo, the of Nita Villanueva, against petitioner Antonio Geluz, a physician.
Convinced of the merits of the complaint upon the evidence adduced, the trial court
rendered judgment favor of plaintiff Lazo and against defendant Geluz, ordering the
latter to pay P3,000.00 as damages, P700.00 attorney's fees and the costs of the suit.
On appeal, Court of Appeals, in a special division of five, sustained the award by a
majority vote of three justices as against two, who rendered a separate dissenting
opinion.
The facts are set forth in the majority opinion as follows:

Persons Arts. 36-40 - 18

Nita Villanueva came to know the defendant (Antonio Geluz) for the first time in 1948
through her aunt Paula Yambot. In 1950 she became pregnant by her present
husband before they were legally married. Desiring to conceal her pregnancy from her
parent, and acting on the advice of her aunt, she had herself aborted by the
defendant. After her marriage with the plaintiff, she again became pregnant. As she
was then employed in the Commission on Elections and her pregnancy proved to be
inconvenient, she had herself aborted again by the defendant in October 1953. Less
than two years later, she again became pregnant. On February 21, 1955,
accompanied by her sister Purificacion and the latter's daughter Lucida, she again
repaired to the defendant's clinic on Carriedo and P. Gomez streets in Manila, where
the three met the defendant and his wife. Nita was again aborted, of a two-month old
foetus, in consideration of the sum of fifty pesos, Philippine currency. The plaintiff was
at this time in the province of Cagayan, campaigning for his election to the provincial
board; he did not know of, nor gave his consent, to the abortion.
It is the third and last abortion that constitutes plaintiff's basis in filing this action and
award of damages. Upon application of the defendant Geluz we granted certiorari.
The Court of Appeals and the trial court predicated the award of damages in the sum
of P3,000.06 upon the provisions of the initial paragraph of Article 2206 of the Civil
Code of the Philippines. This we believe to be error, for the said article, in fixing a
minimum award of P3,000.00 for the death of a person, does not cover the case of an
unborn foetus that is not endowed with personality. Under the system of our Civil
Code, "la criatura abortiva no alcanza la categoria de persona natural y en
consscuencia es un ser no nacido a la vida del Derecho" (Casso-Cervera, "Diccionario
de Derecho Privado", Vol. 1, p. 49), being incapable of having rights and obligations.

Since an action for pecuniary damages on account of personal injury or death pertains
primarily to the one injured, it is easy to see that if no action for such damages could
be instituted on behalf of the unborn child on account of the injuries it received, no
such right of action could derivatively accrue to its parents or heirs. In fact, even if a
cause of action did accrue on behalf of the unborn child, the same was extinguished
by its pre-natal death, since no transmission to anyone can take place from on that
lacked juridical personality (or juridical capacity as distinguished from capacity to act).
It is no answer to invoke the provisional personality of a conceived child (conceptus
pro nato habetur) under Article 40 of the Civil Code, because that same article
expressly limits such provisional personality by imposing the condition that the child
should be subsequently born alive: "provided it be born later with the condition
specified in the following article". In the present case, there is no dispute that the
child was dead when separated from its mother's womb.
The prevailing American jurisprudence is to the same effect; and it is generally held
that recovery can not had for the death of an unborn child (Stafford vs. Roadway
Transit Co., 70 F. Supp. 555; Dietrich vs. Northampton, 52 Am. Rep. 242; and
numerous cases collated in the editorial note, 10 ALR, (2d) 639).
This is not to say that the parents are not entitled to collect any damages at all. But
such damages must be those inflicted directly upon them, as distinguished from the
injury or violation of the rights of the deceased, his right to life and physical integrity.
Because the parents can not expect either help, support or services from an unborn
child, they would normally be limited to moral damages for the illegal arrest of the
normal development of the spes hominis that was the foetus, i.e., on account of
distress and anguish attendant to its loss, and the disappointment of their parental
expectations (Civ. Code Art. 2217), as well as to exemplary damages, if the

Persons Arts. 36-40 - 19

circumstances should warrant them (Art. 2230). But in the case before us, both the
trial court and the Court of Appeals have not found any basis for an award of moral
damages, evidently because the appellee's indifference to the previous abortions of
his wife, also caused by the appellant herein, clearly indicates that he was
unconcerned with the frustration of his parental hopes and affections. The lower court
expressly found, and the majority opinion of the Court of Appeals did not contradict it,
that the appellee was aware of the second abortion; and the probabilities are that he
was likewise aware of the first. Yet despite the suspicious repetition of the event, he
appeared to have taken no steps to investigate or pinpoint the causes thereof, and
secure the punishment of the responsible practitioner. Even after learning of the third
abortion, the appellee does not seem to have taken interest in the administrative and
criminal cases against the appellant. His only concern appears to have been directed
at obtaining from the doctor a large money payment, since he sued for P50,000.00
damages and P3,000.00 attorney's fees, an "indemnity" claim that, under the
circumstances of record, was clearly exaggerated.

amended a certificate of public convenience be issued to the Intestate Estate of the


deceased Pedro Fragante, authorizing said Intestate Estate through its Special or
Judicial Administrator, appointed by the proper court of competent jurisdiction, to
maintain and operate an ice plant with a daily productive capacity of two and one-half
(2-1/2) tons in the Municipality of San Juan and to sell the ice produced from said
plant in the said Municipality of San Juan and in the Municipality of Mandaluyong,
Rizal, and in Quezon City", subject to the conditions therein set forth in detail
(petitioner's brief, pp. 33-34).

The dissenting Justices of the Court of Appeals have aptly remarked that:

3. The Public Service Commission erred in not giving petitioner and the Ice and Cold
Storage Industries of the Philippines, Inc., as existing operators, a reasonable
opportunity to meet the increased demand.
4. The decision of the Public Service Commission is an unwarranted departure from its
announced policy with respect to the establishment and operation of ice plant. (Pp. 12, petitioner's brief.)

It seems to us that the normal reaction of a husband who righteously feels outraged
by the abortion which his wife has deliberately sought at the hands of a physician
would be highminded rather than mercenary; and that his primary concern would be
to see to it that the medical profession was purged of an unworthy member rather
than turn his wife's indiscretion to personal profit, and with that idea in mind to press
either the administrative or the criminal cases he had filed, or both, instead of
abandoning them in favor of a civil action for damages of which not only he, but also
his wife, would be the beneficiaries.
It is unquestionable that the appellant's act in provoking the abortion of appellee's
wife, without medical necessity to warrant it, was a criminal and morally
reprehensible act, that can not be too severely condemned; and the consent of the
woman or that of her husband does not excuse it. But the immorality or illegality of
the act does not justify an award of damage that, under the circumstances on record,
have no factual or legal basis.
The decision appealed from is reversed, and the complaint ordered dismissed.
Without costs.
Let a copy of this decision be furnished to the Department of Justice and the Board of
Medical Examiners for their information and such investigation and action against the
appellee Antonio Geluz as the facts may warrant.

LIMJUCO v. ESTATE OF FRAGRANTE


Under date of May 21, 1946, the Public Service Commission, through Deputy
Commissioner Fidel Ibaez, rendered its decision in case No. 4572 of Pedro O.
Fragante, as applicant for a certificate of public convenience to install, maintain and
operate an ice plant in San Juan, Rizal, whereby said commission held that the
evidence therein showed that the public interest and convenience will be promoted in
a proper and suitable manner "by authorizing the operation and maintenance of
another ice plant of two and one-half (2-) tons in the municipality of San Juan; that
the original applicant Pedro O. Fragante was a Filipino Citizen at the time of his death;
and that his intestate estate is financially capable of maintaining the proposed
service". The commission, therefore, overruled the opposition filed in the case and
ordered "that under the provisions of section 15 of Commonwealth Act No. 146, as

Petitioner makes four assignments of error in his brief as follows:


1. The decision of the Public Service Commission is not in accordance with law.
2. The decision of the Public Service Commission is not reasonably supported by
evidence.

In his argument petitioner contends that it was error on the part of the commission to
allow the substitution of the legal representative of the estate of Pedro O. Fragante for
the latter as party applicant in the case then pending before the commission, and in
subsequently granting to said estate the certificate applied for, which is said to be in
contravention of law.
If Pedro O. Fragante had not died, there can be no question that he would have had
the right to prosecute his application before the commission to its final conclusion. No
one would have denied him that right. As declared by the commission in its decision,
he had invested in the ice plant in question P 35,000, and from what the commission
said regarding his other properties and business, he would certainly have been
financially able to maintain and operate said plant had he not died. His transportation
business alone was netting him about P1,440 a month. He was a Filipino citizen and
continued to be such till his demise. The commission declared in its decision, in view
of the evidence before it, that his estate was financially able to maintain and operate
the ice plant. The aforesaid right of Pedro O. Fragante to prosecute said application to
its conclusion was one which by its nature did not lapse through his death. Hence, it
constitutes a part of the assets of his estate, for which a right was property despite
the possibility that in the end the commission might have denied application,
although under the facts of the case, the commission granted the application in view
of the financial ability of the estate to maintain and operate the ice plant. Petitioner,
in his memorandum of March 19, 1947, admits (page 3) that the certificate of public
convenience once granted "as a rule, should descend to his estate as an asset". Such
certificate would certainly be property, and the right to acquire such a certificate, by
complying with the requisites of the law, belonged to the decedent in his lifetime, and
survived to his estate and judicial administrator after his death.
If Pedro O. Fragrante had in his lifetime secured an option to buy a piece of land and
during the life of the option he died, if the option had been given him in the ordinary
course of business and not out of special consideration for his person, there would be
no doubt that said option and the right to exercise it would have survived to his estate

and legal representatives. In such a case there would also be the possibility of failure
to acquire the property should he or his estate or legal representative fail to comply
with the conditions of the option. In the case at bar Pedro O. Fragrante's undoubted
right to apply for and acquire the desired certificate of public convenience the
evidence established that the public needed the ice plant was under the law
conditioned only upon the requisite citizenship and economic ability to maintain and
operate the service. Of course, such right to acquire or obtain such certificate of
public convenience was subject to failure to secure its objective through
nonfulfillment of the legal conditions, but the situation here is no different from the
legal standpoint from that of the option in the illustration just given.
Rule 88, section 2, provides that the executor or administrator may bring or defend
actions, among other cases, for the protection of the property or rights of the
deceased which survive, and it says that such actions may be brought or defended "in
the right of the deceased".
Rule 82, section 1, paragraph (a), mentions among the duties of the executor or
administrator, the making of an inventory of all goods, chattels, rights, credits, and
estate of the deceased which shall come to his possession or knowledge, or to the
possession of any other person for him.
In his commentaries on the Rules of Court (Volume II, 2nd ed., pages 366, 367) the
present chief Justice of this Court draws the following conclusion from the decisions
cited by him:
Therefore, unless otherwise expressly provided by law, any action affecting the
property or rights (emphasis supplied) of a deceased person which may be brought by
or against him if he were alive, may likewise be instituted and prosecuted by or
against the administrator, unless the action is for recovery of money, debt or interest
thereon, or unless, by its very nature, it cannot survive, because death extinguishes
the right . . . .
It is true that a proceeding upon the application for a certificate of public convenience
before the Public Service Commission is not an "action". But the foregoing provisions
and citations go to prove that the decedent's rights which by their nature are not
extinguished by death go to make up a part and parcel of the assets of his estate
which, being placed under the control and management of the executor or
administrator, can not be exercised but by him in representation of the estate for the
benefit of the creditors, devisees or legatees, if any, and the heirs of the decedent.
And if the right involved happens to consist in the prosecution of an unfinished
proceeding upon an application for a certificate of public convenience of the deceased
before the Public Service Commission, it is but logical that the legal representative be
empowered and entitled in behalf of the estate to make the right effective in that
proceeding.
Manresa (Vol. III, 6th ed., p. 11) says that No. 10 of article 334 and article 336 of the
Civil Code, respectively, consider as immovable and movable things rights which are
not material. The same eminent commentator says in the cited volume (p. 45) that
article 336 of the Civil Code has been deficiently drafted in that it is not sufficiently
expressive of all incorporeal rights which are also property for juridical purposes.
Corpus Juris (Vol. 50, p. 737) states that in the broad sense of the term, property
includes, among other things, "an option", and "the certificate of the railroad

Persons Arts. 36-40 - 20

commission permitting the operation of a bus line", and on page 748 of the same
volume we read:

However, these terms (real property, as estate or interest) have also been declared to
include every species of title, inchoate or complete, and embrace rights which lie in
contract, whether executory or executed. (Emphasis supplied.)
Another important question raised by petitioner is whether the estate of Pedro O.
Fragrante is a "person" within the meaning of the Public Service Act.
Words and Phrases, First Series, (Vol. 6, p, 5325), states the following doctrine in the
jurisdiction of the State of Indiana:
As the estate of the decedent is in law regarded as a person, a forgery committed
after the death of the man whose name purports to be signed to the instrument may
be prosecuted as with the intent to defraud the estate. Billings vs. State, 107 Ind., 54,
55, 6 N. E. 914, 7 N. E. 763, 57 Am. Rep. 77.
The Supreme Court of Indiana in the decision cited above had before it a case of
forgery committed after the death of one Morgan for the purpose of defrauding his
estate. The objection was urged that the information did not aver that the forgery was
committed with the intent to defraud any person. The Court, per Elliott, J., disposed of
this objection as follows:
. . . The reason advanced in support of this proposition is that the law does not regard
the estate of a decedent as a person. This intention (contention) cannot prevail. The
estate of the decedent is a person in legal contemplation. "The word "person" says Mr.
Abbot, "in its legal signification, is a generic term, and includes artificial as well as
natural persons," 2 Abb. Dict. 271; Douglas vs. Pacific, etc. Co., 4 Cal. 304; Planters',
etc., Bank vs. Andrews, 8 Port. (Ala.) 404. It said in another work that 'persons are of
two kinds: natural and artificial. A natural person is a human being. Artificial persons
include (1) a collection or succession of natural persons forming a corporation; (2) a
collection of property to which the law attributes the capacity of having rights and
duties. The latter class of artificial persons is recognized only to a limited extent in our
law. "Examples are the estate of a bankrupt or deceased person." 2 Rapalje & L. Law
Dict. 954. Our own cases inferentially recognize the correctness of the definition given
by the authors from whom we have quoted, for they declare that it is sufficient, in
pleading a claim against a decedent's estate, to designate the defendant as the
estate of the deceased person, naming him. Ginn vs. Collins, 43 Ind. 271. Unless we
accept this definition as correct, there would be a failure of justice in cases where, as
here, the forgery is committed after the death of a person whose name is forged; and
this is a result to be avoided if it can be done consistent with principle. We perceive
no difficulty in avoiding such a result; for, to our minds, it seems reasonable that the
estate of a decedent should be regarded as an artificial person. It is the creation of
law for the purpose of enabling a disposition of the assets to be properly made, and,
although natural persons as heirs, devises, or creditors, have an interest in the
property, the artificial creature is a distinct legal entity. The interest which natural
persons have in it is not complete until there has been a due administration; and one
who forges the name of the decedent to an instrument purporting to be a promissory
note must be regarded as having intended to defraud the estate of the decedent, and
not the natural persons having diverse interests in it, since ha cannot be presumed to
have known who those persons were, or what was the nature of their respective
interest. The fraudulent intent is against the artificial person, the estate and not

the natural persons who have direct or contingent interest in it. (107 Ind. 54, 55, 6
N.E. 914-915.)
In the instant case there would also be a failure of justice unless the estate of Pedro O.
Fragrante is considered a "person", for quashing of the proceedings for no other
reason than his death would entail prejudicial results to his investment amounting to
P35,000.00 as found by the commission, not counting the expenses and
disbursements which the proceeding can be presumed to have occasioned him during
his lifetime, let alone those defrayed by the estate thereafter. In this jurisdiction there
are ample precedents to show that the estate of a deceased person is also considered
as having legal personality independent of their heirs. Among the most recent cases
may be mentioned that of "Estate of Mota vs. Concepcion, 56 Phil., 712, 717, wherein
the principal plaintiff was the estate of the deceased Lazaro Mota, and this Court gave
judgment in favor of said estate along with the other plaintiffs in these words:
. . . the judgment appealed from must be affirmed so far as it holds that defendants
Concepcion and Whitaker are indebted to he plaintiffs in the amount of
P245,804.69 . . . .
Under the regime of the Civil Code and before the enactment of the Code of Civil
Procedure, the heirs of a deceased person were considered in contemplation of law as
the continuation of his personality by virtue of the provision of article 661 of the first
Code that the heirs succeed to all the rights and obligations of the decedent by the
mere fact of his death. It was so held by this Court in Barrios vs. Dolor, 2 Phil., 44, 46.
However, after the enactment of the Code of Civil Procedure, article 661 of the Civil
Code was abrogated, as held in Suiliong & Co. vs. Chio-Taysan, 12 Phil., 13, 22. In that
case, as well as in many others decided by this Court after the innovations introduced
by the Code of Civil Procedure in the matter of estates of deceased persons, it has
been the constant doctrine that it is the estate or the mass of property, rights and
assets left by the decedent, instead of the heirs directly, that becomes vested and
charged with his rights and obligations which survive after his demise.
The heirs were formerly considered as the continuation of the decedent's personality
simply by legal fiction, for they might not have been flesh and blood the reason
was one in the nature of a legal exigency derived from the principle that the heirs
succeeded to the rights and obligations of the decedent. Under the present legal
system, such rights and obligations as survive after death have to be exercised and
fulfilled only by the estate of the deceased. And if the same legal fiction were not
indulged, there would be no juridical basis for the estate, represented by the executor
or administrator, to exercise those rights and to fulfill those obligations of the
deceased. The reason and purpose for indulging the fiction is identical and the same
in both cases. This is why according to the Supreme Court of Indiana in Billings vs.
State, supra, citing 2 Rapalje & L. Dictionary, 954, among the artificial persons
recognized by law figures "a collection of property to which the law attributes the
capacity of having rights and duties", as for instance, the estate of a bankrupt or
deceased person.
Petitioner raises the decisive question of whether or not the estate of Pedro O.
Fragrante can be considered a "citizen of the Philippines" within the meaning of
section 16 of the Public Service Act, as amended, particularly the proviso thereof
expressly and categorically limiting the power of the commission to issue certificates
of public convenience or certificates of public convenience and necessity "only to
citizens of the Philippines or of the United States or to corporations, copartnerships,
associations, or joint-stock companies constituted and organized under the laws of

Persons Arts. 36-40 - 21

the Philippines", and the further proviso that sixty per centum of the stock or paid-up
capital of such entities must belong entirely to citizens of the Philippines or of the
United States.
Within the Philosophy of the present legal system, the underlying reason for the legal
fiction by which, for certain purposes, the estate of the deceased person is considered
a "person" is the avoidance of injustice or prejudice resulting from the impossibility of
exercising such legal rights and fulfilling such legal obligations of the decedent as
survived after his death unless the fiction is indulged. Substantially the same reason
is assigned to support the same rule in the jurisdiction of the State of Indiana, as
announced in Billings vs. State, supra, when the Supreme Court of said State said:
. . . It seems reasonable that the estate of a decedent should be regarded as an
artificial person. it is the creation of law for the purpose of enabling a disposition of
the assets to be properly made . . . .

Within the framework and principles of the constitution itself, to cite just one example,
under the bill of rights it seems clear that while the civil rights guaranteed therein in
the majority of cases relate to natural persons, the term "person" used in section 1 (1)
and (2) must be deemed to include artificial or juridical persons, for otherwise these
latter would be without the constitutional guarantee against being deprived of
property without due process of law, or the immunity from unreasonable searches and
seizures. We take it that it was the intendment of the framers to include artificial or
juridical, no less than natural, persons in these constitutional immunities and in others
of similar nature. Among these artificial or juridical persons figure estates of deceased
persons. Hence, we hold that within the framework of the Constitution, the estate of
Pedro O. Fragrante should be considered an artificial or juridical person for the
purposes of the settlement and distribution of his estate which, of course, include the
exercise during the judicial administration thereof of those rights and the fulfillment of
those obligations of his which survived after his death. One of those rights was the
one involved in his pending application before the Public Service Commission in the
instant case, consisting in the prosecution of said application to its final conclusion. As
stated above, an injustice would ensue from the opposite course.
How about the point of citizenship? If by legal fiction his personality is considered
extended so that any debts or obligations left by, and surviving, him may be paid, and
any surviving rights may be exercised for the benefit of his creditors and heirs,
respectively, we find no sound and cogent reason for denying the application of the
same fiction to his citizenship, and for not considering it as likewise extended for the
purposes of the aforesaid unfinished proceeding before the Public Service
Commission. The outcome of said proceeding, if successful, would in the end inure to
the benefit of the same creditors and the heirs. Even in that event petitioner could not
allege any prejudice in the legal sense, any more than he could have done if
Fragrante had lived longer and obtained the desired certificate. The fiction of such
extension of his citizenship is grounded upon the same principle, and motivated by
the same reason, as the fiction of the extension of personality. The fiction is made
necessary to avoid the injustice of subjecting his estate, creditors and heirs, solely by
reason of his death to the loss of the investment amounting to P35,000, which he has
already made in the ice plant, not counting the other expenses occasioned by the
instant proceeding, from the Public Service Commission of this Court.
We can perceive no valid reason for holding that within the intent of the constitution
(Article IV), its provisions on Philippine citizenship exclude the legal principle of
extension above adverted to. If for reasons already stated our law indulges the fiction

Persons Arts. 36-40 - 22

of extension of personality, if for such reasons the estate of Pedro O. Fragrante should
be considered an artificial or juridical person herein, we can find no justification for
refusing to declare a like fiction as to the extension of his citizenship for the purposes
of this proceeding.

or authorization be exclusive in character or for a longer period than fifty years. No


franchise granted to any individual, firm or corporation, except under the condition
that it shall be subject to amendment, alteration, or repeal by Congress when the
public interest so requires.

Pedro O. Fragrante was a Filipino citizen, and as such, if he had lived, in view of the
evidence of record, he would have obtained from the commission the certificate for
which he was applying. The situation has suffered but one change, and that is, his
death. His estate was that of a Filipino citizen. And its economic ability to
appropriately and adequately operate and maintain the service of an ice plant was
the same that it received from the decedent himself. In the absence of a contrary
showing, which does not exist here, his heirs may be assumed to be also Filipino
citizens; and if they are not, there is the simple expedient of revoking the certificate
or enjoining them from inheriting it.

The main question in this case is whether the estate of Pedro O. Fragrante fulfills the
citizenship requirement. To our mind, the question can be restated by asking whether
the heirs of Pedro O. Fragrante fulfill the citizenship requirement of the law.

Upon the whole, we are of the opinion that for the purposes of the prosecution of said
case No. 4572 of the Public Service Commission to its final conclusion, both the
personality and citizenship of Pedro O. Fragrante must be deemed extended, within
the meaning and intent of the Public Service Act, as amended, in harmony with the
constitution: it is so adjudged and decreed.
Decision affirmed, without costs. So ordered.
Separate Opinions
PERFECTO, J., dissenting:
Commonwealth Act No. 146 reserves to Filipino citizens the right to obtain a
certificate of public convenience to operate an ice plant in San Juan, Rizal. The
limitation is in accordance with section 8 of Article XIV of the Constitution which
provides
No franchise, certificate, or any other form of authorization for the operation of a
public utility shall be granted except to citizens of the Philippines or to corporations or
other entities organized under the laws of the Philippines, sixty per centum of the
capital of which is owned by citizens of the Philippines, nor such franchise, certificate

The estate is an abstract entity. As such, its legal value depends on what it
represents. It is a device by which the law gives a kind of personality and unity to
undetermined tangible persons, the heirs. They inherit and replace the deceased at
the very moment of his death. As there are procedural requisites for their
identification and determination that need time for their compliance, a legal fiction
has been devised to represent them. That legal fiction is the estate, a liquid condition
in process of solidification.
The estate, therefore, has only a representative value. What the law calls estate is, a
matter of fact, intended to designate the heirs of the deceased. The question,
therefore, in this case, boils down to the citizenship of the heirs of Fragrante.
There is nothing in the record to show conclusively the citizenship of the heirs of
Fragrante. If they are Filipino citizens, the action taken by the Public Service
Commission should be affirmed. If they are not, it should be reversed.
Petitioner alleges that the estate is just a front or dummy for aliens to go around the
citizenship constitutional provision. It is alleged that Gaw Suy, the special
administrator of the estate, is an alien.
We are of the opinion that the citizenship of the heirs of Fragrante should be
determined by the Commission upon evidence that the party should be present. It
should also determine the dummy question raised by the petitioner.
We are of opinion and so vote that the decision of the Public Service Commission of
May 21, 1946, be set aside and that the Commission be instructed to receive
evidence of the above factual questions and render a new decision accordingly.