Labor RELATIONS ASSIGNMENT 1 FULL TEXT

1. JOSEPH EJERCITO VS. SANDIGANBAYAN GR NO. 157294-95 4. MC # 039978 dated January 18, 2000 in the amount of P1,000,000.00;
NOV. 30,2006
CARPIO MORALES, J.: The Special Prosecution Panel also filed on January 20, 2003, a Request for Issuance of Subpoena Duces
Tecum/Ad Testificandum directed to the authorized representative of Equitable-PCI Bank to produce
The present petition for certiorari under Rule 65 assails the Sandiganbayan Resolutions dated statements of account pertaining to certain accounts in the name of Jose Velarde and to testify thereon.
February 7 and 12, 2003 denying petitioner Joseph Victor G. Ejercitos Motions to Quash Subpoenas Duces
Tecum/Ad Testificandum, and Resolution dated March 11, 2003 denying his Motion for Reconsideration of the The Sandiganbayan granted both requests by Resolution of January 21, 2003 and subpoenas were
first two resolutions. accordingly issued.

The three resolutions were issued in Criminal Case No. 26558, People of the Philippines v. Joseph The Special Prosecution Panel filed still another Request for Issuance of Subpoena Duces Tecum/Ad
Ejercito Estrada, et al., for plunder, defined and penalized in R.A. 7080, AN ACT DEFINING AND PENALIZING THE Testificandum dated January 23, 2003 for the President of EIB or his/her authorized representative to produce
CRIME OF PLUNDER. the same documents subject of the Subpoena Duces Tecum dated January 21, 2003 and to testify thereon on the
hearings scheduled on January 27 and 29, 2003 and subsequent dates until completion of the testimony. The
In above-stated case of People v. Estrada, et al., the Special Prosecution Panel[1] filed on January 20, request was likewise granted by the Sandiganbayan. A Subpoena Duces Tecum/Ad Testificandum was
2003 before the Sandiganbayan a Request for Issuance of Subpoena Duces Tecum for the issuance of a subpoena accordingly issued on January 24, 2003.
directing the President of Export and Industry Bank (EIB, formerly Urban Bank) or his/her authorized
representative to produce the following documents during the hearings scheduled on January 22 and 27, 2003: Petitioner, claiming to have learned from the media that the Special Prosecution Panel had requested
for the issuance of subpoenas for the examination of bank accounts belonging to him, attended the hearing of the
I. For Trust Account No. 858; case on January 27, 2003 and filed before the Sandiganbayan a letter of even date expressing his concerns as
1. Account Opening Documents; follows, quoted verbatim:
2. Trading Order No. 020385 dated January 29, 1999;
3. Confirmation Advice TA 858; Your Honors:
4. Original/Microfilm copies, including the dorsal side, of the following:
It is with much respect that I write this court relative to the concern of subpoenaing the
a. Bank of Commerce MC # 0256254 in the amount of P2,000,000.00; undersigneds bank account which I have learned through the media.
b. Urban bank Corp. MC # 34181 dated November 8, 1999 in the amount of
P10,875,749.43; I am sure the prosecution is aware of our banking secrecy laws everyone supposed to
c. Urban Bank MC # 34182 dated November 8, 1999 in the amount observe. But, instead of prosecuting those who may have breached such laws, it seems it is
of P42,716,554.22; even going to use supposed evidence which I have reason to believe could only have been
d. Urban Bank Corp. MC # 37661 dated November 23, 1999 in the amount illegally obtained.
of P54,161,496.52;
The prosecution was not content with a general request. It even lists and identifies specific
5. Trust Agreement dated January 1999: documents meaning someone else in the bank illegally released confidential information.
Trustee: Joseph Victor C. Ejercito
Nominee: URBAN BANK-TRUST DEPARTMENT If this can be done to me, it can happen to anyone. Not that anything can still shock our
Special Private Account No. (SPAN) 858; and family. Nor that I have anything to hide. Your Honors.
6. Ledger of the SPAN # 858.
But, I am not a lawyer and need time to consult one on a situation that affects every bank
II. For Savings Account No. 0116-17345-9 depositor in the country and should interest the bank itself, the Bangko Sentral ng Pilipinas,
SPAN No. 858 and maybe the Ombudsman himself, who may want to investigate, not exploit, the serious
breach that can only harm the economy, a consequence that may have been
1. Signature Cards; and overlooked. There appears to have been deplorable connivance.
2. Statement of Account/Ledger
xxxx
III. Urban Bank Managers Check and their corresponding Urban Bank Managers Check Application Forms,
as follows: I hope and pray, Your Honors, that I will be given time to retain the services of a lawyer to
help me protect my rights and those of every banking depositor. But the one I have in mind is
1. MC # 039975 dated January 18, 2000 in the amount of P70,000,000.00; out of the country right now.
2. MC # 039976 dated January 18, 2000 in the amount of P2,000,000.00;
3. MC # 039977 dated January 18, 2000 in the amount of P2,000,000.00;
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
May I, therefore, ask your Honors, that in the meantime, the issuance of the subpoena be held
in abeyance for at least ten (10) days to enable me to take appropriate legal steps in
connection with the prosecutions request for the issuance of subpoena concerning my
accounts. (Emphasis supplied)
From the present petition, it is gathered that the accounts referred to by petitioner in his above-quoted
letter are Trust Account No. 858 and Savings Account No. 0116-17345-9.[2]
In open court, the Special Division of the Sandiganbayan, through Associate Justice Edilberto Sandoval,
advised petitioner that his remedy was to file a motion to quash, for which he was given up to 12:00 noon the
following day, January 28, 2003.
Petitioner, unassisted by counsel, thus filed on January 28, 2003 a Motion to Quash Subpoena Duces
Tecum/Ad Testificandum praying that the subpoenas previously issued to the President of the EIB dated
January 21 and January 24, 2003 be quashed.[3]
In his Motion to Quash, petitioner claimed that his bank accounts are covered by R.A. No. 1405 (The
Secrecy of Bank Deposits Law) and do not fall under any of the exceptions stated therein. He further claimed that
the specific identification of documents in the questioned subpoenas, including details on dates and amounts,
could only have been made possible by an earlier illegal disclosure thereof by the EIB and the Philippine Deposit
Insurance Corporation (PDIC) in its capacity as receiver of the then Urban Bank.
The disclosure being illegal, petitioner concluded, the prosecution in the case may not be allowed to
make use of the information.
Before the Motion to Quash was resolved by the Sandiganbayan, the prosecution filed another Request
for the Issuance of Subpoena Duces Tecum/Ad Testificandum dated January 31, 2003, again to direct the
President of the EIB to produce, on the hearings scheduled on February 3 and 5, 2003, the same documents
subject of the January 21 and 24, 2003 subpoenas with the exception of the Bank of Commerce MC #0256254 in
the amount of P2,000,000 as Bank of Commerce MC #0256256 in the amount of P200,000,000 was instead
requested. Moreover, the request covered the following additional documents:
IV. For Savings Account No. 1701-00646-1:
1. Account Opening Forms;
2. Specimen Signature Card/s; and
3. Statements of Account.
The prosecution also filed a Request for the Issuance of Subpoena Duces Tecum/Ad Testificandum
bearing the same date, January 31, 2003, directed to Aurora C. Baldoz, Vice President-CR-II of the PDIC for her to
produce the following documents on the scheduled hearings on February 3 and 5, 2003:
1. Letter of authority dated November 23, 1999 re: SPAN [Special Private Account
Number] 858;
2. Letter of authority dated January 29, 2000 re: SPAN 858;
3. Letter of authority dated April 24, 2000 re: SPAN 858;
4. Urban Bank check no. 052092 dated April 24, 2000 for the amount of P36, 572, 315.43;
5. Urban Bank check no. 052093 dated April 24, 2000 for the amount of P107,191,780.85; and
6. Signature Card Savings Account No. 0116-17345-9. (Underscoring supplied)
The subpoenas prayed for in both requests were issued by the Sandiganbayan on January 31, 2003.
On February 7, 2003, petitioner, this time assisted by counsel, filed an Urgent Motion to Quash
Subpoenae Duces Tecum/Ad Testificandum praying that the subpoena dated January 31, 2003 directed to
Aurora Baldoz be quashed for the same reasons which he cited in the Motion to Quash[4] he had earlier filed.
On the same day, February 7, 2003, the Sandiganbayan issued a Resolution denying petitioners
Motion to Quash Subpoenae Duces Tecum/Ad Testificandum dated January 28, 2003.
Subsequently or on February 12, 2003, the Sandiganbayan issued a Resolution denying petitioners
Urgent Motion to Quash Subpoena Duces Tecum/Ad Testificandum dated February 7, 2003.
Petitioners Motion for Reconsideration dated February 24, 2003 seeking a reconsideration of the
Resolutions of February 7 and 12, 2003 having been denied by Resolution of March 11, 2003, petitioner filed
the present petition.
Raised as issues are:
1. Whether petitioners Trust Account No. 858 is covered by the term deposit as used in R.A. 1405;
2. Whether petitioners Trust Account No. 858 and Savings Account No. 0116-17345-9 are
excepted from the protection of R.A. 1405; and
3. Whether the extremely-detailed information contained in the Special Prosecution Panels
requests for subpoena was obtained through a prior illegal disclosure of petitioners bank
accounts, in violation of the fruit of the poisonous tree doctrine.
Respondent People posits that Trust Account No. 858 [5] may be inquired into, not merely because it
falls under the exceptions to the coverage of R.A. 1405, but because it is not even contemplated therein. For, to
respondent People, the law applies only to deposits which strictly means the money delivered to the bank by
which a creditor-debtor relationship is created between the depositor and the bank.
The contention that trust accounts are not covered by the term deposits, as used in R.A. 1405, by the
mere fact that they do not entail a creditor-debtor relationship between the trustor and the bank, does not
lie. An examination of the law shows that the term deposits used therein is to be understood broadly and not
limited only to accounts which give rise to a creditor-debtor relationship between the depositor and the bank.
The policy behind the law is laid down in Section 1:
SECTION 1. It is hereby declared to be the policy of the Government to give encouragement to
the people to deposit their money in banking institutions and to discourage private hoarding
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
so that the same may be properly utilized by banks in authorized loans to assist in the
economic development of the country. (Underscoring supplied)
If the money deposited under an account may be used by banks for authorized loans to third persons,
then such account, regardless of whether it creates a creditor-debtor relationship between the depositor and the
bank, falls under the category of accounts which the law precisely seeks to protect for the purpose of boosting
the economic development of the country.
Trust Account No. 858 is, without doubt, one such account. The Trust Agreement between petitioner
and Urban Bank provides that the trust account covers deposit, placement or investment of funds by Urban
Bank for and in behalf of petitioner.[6] The money deposited under Trust Account No. 858, was, therefore,
intended not merely to remain with the bank but to be invested by it elsewhere. To hold that this type of account
is not protected by R.A. 1405 would encourage private hoarding of funds that could otherwise be invested by
banks in other ventures, contrary to the policy behind the law.
Section 2 of the same law in fact even more clearly shows that the term deposits was intended to be
understood broadly:
SECTION 2. All deposits of whatever nature with banks or banking institutions in the
Philippines including investments in bonds issued by the Government of the Philippines, its
political subdivisions and its instrumentalities, are hereby considered as of an absolutely
confidential nature and may not be examined, inquired or looked into by any person,
government official, bureau or office, except upon written permission of the depositor, or in
cases of impeachment, or upon order of a competent court in cases of bribery or dereliction of
duty of public officials, or in cases where the money deposited or invested is the subject
matter of the litigation. (Emphasis and underscoring supplied)
The phrase of whatever nature proscribes any restrictive interpretation of deposits. Moreover, it is
clear from the immediately quoted provision that, generally, the law applies not only to money which is
deposited but also to those which are invested. This further shows that the law was not intended to apply only to
deposits in the strict sense of the word. Otherwise, there would have been no need to add the phrase or invested.
Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account No. 858.
The protection afforded by the law is, however, not absolute, there being recognized exceptions
thereto, as above-quoted Section 2 provides. In the present case, two exceptions apply, to wit: (1) the
examination of bank accounts is upon order of a competent court in cases of bribery or dereliction of duty of
public officials, and (2) the money deposited or invested is the subject matter of the litigation.
Petitioner contends that since plunder is neither bribery nor dereliction of duty, his accounts are not
excepted from the protection of R.A. 1405. Philippine National Bank v. Gancayco[7] holds otherwise:
Cases of unexplained wealth are similar to cases of bribery or dereliction of duty and no
reason is seen why these two classes of cases cannot be excepted from the rule making bank
deposits confidential. The policy as to one cannot be different from the policy as to the
other. This policy expresses the notion that a public office is a public trust and any
person who enters upon its discharge does so with the full knowledge that his life, so far as
relevant to his duty, is open to public scrutiny.
Undoubtedly, cases for plunder involve unexplained wealth. Section 2 of R.A. No. 7080 states so.
SECTION 2. Definition of the Crime of Plunder; Penalties. Any public officer who, by himself
or in connivance with members of his family, relatives by affinity or consanguinity, business
associates, subordinates or other persons, amasses, accumulates or acquires ill-gotten
wealth through a combination or series of overt or criminal acts as described in Section 1(d)
hereof, in the aggregate amount or total value of at least Seventy-five million pesos
(P75,000,000.00), shall be guilty of the crime of plunder and shall be punished by life
imprisonment with perpetual absolute disqualification from holding any public office. Any
person who participated with said public officer in the commission of plunder shall likewise
be punished. In the imposition of penalties, the degree of participation and the attendance of
mitigating and extenuating circumstances shall be considered by the court. The court shall
declare any and all ill-gotten wealth and their interests and other incomes and assets
including the properties and shares of stock derived from the deposit or investment thereof
forfeited in favor of the State. (Emphasis and underscoring supplied)
An examination of the overt or criminal acts as described in Section 1(d) of R.A. No. 7080 would make
the similarity between plunder and bribery even more pronounced since bribery is essentially included among
these criminal acts. Thus Section 1(d) states:
d) Ill-gotten wealth means any asset, property, business enterprise or material
possession of any person within the purview of Section Two (2) hereof, acquired by him
directly or indirectly through dummies, nominees, agents, subordinates and or business
associates by any combination or series of the following means or similar schemes.
1) Through misappropriation, conversion, misuse, or malversation of public funds or raids on
the public treasury;
2) By receiving, directly or indirectly, any commission, gift, share, percentage,
kickbacks or any other form of pecuniary benefit from any person and/or entity
in connection with any government contract or project or by reason of the office
or position of the public officer concerned;
3) By the illegal or fraudulent conveyance or disposition of assets belonging to the National
Government or any of its subdivisions, agencies or instrumentalities or government-
owned or -controlled corporations and their subsidiaries;
4) By obtaining, receiving or accepting directly or indirectly any shares of stock, equity or any
other form of interest or participation including promise of future employment in any
business enterprise or undertaking;
5) By establishing agricultural, industrial or commercial monopolies or other combinations
and/or implementation of decrees and orders intended to benefit particular persons
or special interests; or
6) By taking undue advantage of official position, authority, relationship, connection or
influence to unjustly enrich himself or themselves at the expense and to the damage
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
and prejudice of the Filipino people and the Republic of the Philippines. (Emphasis
supplied)
Indeed, all the above-enumerated overt acts are similar to bribery such that, in each case, it may be
said that no reason is seen why these two classes of cases cannot be excepted from the rule making bank
deposits confidential.[8]
The crime of bribery and the overt acts constitutive of plunder are crimes committed by public officers,
and in either case the noble idea that a public office is a public trust and any person who enters upon its
discharge does so with the full knowledge that his life, so far as relevant to his duty, is open to public scrutiny
applies with equal force.
Plunder being thus analogous to bribery, the exception to R.A. 1405 applicable in cases of bribery must
also apply to cases of plunder.
Respecting petitioners claim that the money in his bank accounts is not the subject matter of the
litigation, the meaning of the phrase subject matter of the litigation as used in R.A. 1405 is explained in Union
Bank of the Philippines v. Court of Appeals,[9] thus:
Petitioner contends that the Court of Appeals confuses the cause of action with the
subject of the action. In Yusingco v. Ong Hing Lian, petitioner points out, this Court
distinguished the two concepts.
x x x The cause of action is the legal wrong threatened or
committed, while the object of the action is to prevent or redress the
wrong by obtaining some legal relief; but the subject of the action is
neither of these since it is not the wrong or the relief demanded, the
subject of the action is the matter or thing with respect to which the
controversy has arisen, concerning which the wrong has been done, and
this ordinarily is the property or the contract and its subject matter, or the
thing in dispute.
The argument is well-taken. We note with approval the difference between the
subject of the action from the cause of action. We also find petitioners definition of the phrase
subject matter of the action is consistent with the term subject matter of the litigation, as the
latter is used in the Bank Deposits Secrecy Act.
In Mellon Bank, N.A. v. Magsino, where the petitioner bank inadvertently caused the
transfer of the amount of US$1,000,000.00 instead of only US$1,000.00, the Court
sanctioned the examination of the bank accounts where part of the money was
subsequently caused to be deposited:
x x x Section 2 of [Republic Act No. 1405] allows the disclosure of
bank deposits in cases where the money deposited is the subject matter of
the litigation. Inasmuch as Civil Case No. 26899 is aimed at recovering
the amount converted by the Javiers for their own benefit,
necessarily, an inquiry into the whereabouts of the illegally acquired
amount extends to whatever is concealed by being held or recorded
in the name of persons other than the one responsible for the illegal
acquisition.
Clearly, Mellon Bank involved a case where the money deposited was the subject
matter of the litigation since the money deposited was the very thing in dispute. x x
x (Emphasis and underscoring supplied)
The plunder case now pending with the Sandiganbayan necessarily involves an inquiry into the
whereabouts of the amount purportedly acquired illegally by former President Joseph Estrada.
In light then of this Courts pronouncement in Union Bank, the subject matter of the litigation cannot be
limited to bank accounts under the name of President Estrada alone, but must include those accounts to
which the money purportedly acquired illegally or a portion thereof was alleged to have been transferred. Trust
Account No. 858 and Savings Account No. 0116-17345-9 in the name of petitioner fall under this description and
must thus be part of the subject matter of the litigation.
In a further attempt to show that the subpoenas issued by the Sandiganbayan are invalid and may not
be enforced, petitioner contends, as earlier stated, that the information found therein, given their extremely
detailed character, could only have been obtained by the Special Prosecution Panel through an illegal disclosure
by the bank officials concerned. Petitioner thus claims that, following the fruit of the poisonous tree doctrine, the
subpoenas must be quashed.
Petitioner further contends that even if, as claimed by respondent People, the extremely-detailed
information was obtained by the Ombudsman from the bank officials concerned during a previous investigation
of the charges against President Estrada, such inquiry into his bank accounts would itself be illegal.
Petitioner relies on Marquez v. Desierto[10] where the Court held:
We rule that before an in camera inspection may be allowed there must be a pending case
before a court of competent jurisdiction. Further, the account must be clearly identified, the
inspection limited to the subject matter of the pending case before the court of competent
jurisdiction. The bank personnel and the account holder must be notified to be present during
the inspection, and such inspection may cover only the account identified in the pending case.
(Underscoring supplied)
As no plunder case against then President Estrada had yet been filed before a court of competent
jurisdiction at the time the Ombudsman conducted an investigation, petitioner concludes that the information
about his bank accounts were acquired illegally, hence, it may not be lawfully used to facilitate a subsequent
inquiry into the same bank accounts.
Petitioners attempt to make the exclusionary rule applicable to the instant case fails. R.A. 1405, it bears
noting, nowhere provides that an unlawful examination of bank accounts shall render the evidence obtained
therefrom inadmissible in evidence. Section 5 of R.A. 1405 only states that [a]ny violation of this law will subject
the offender upon conviction, to an imprisonment of not more than five years or a fine of not more than twenty
thousand pesos or both, in the discretion of the court.
The case of U.S. v. Frazin,[11] involving the Right to Financial Privacy Act of 1978 (RFPA) of the United
States, is instructive.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Because the statute, when properly construed, excludes a suppression remedy, it
would not be appropriate for us to provide one in the exercise of our supervisory powers
over the administration of justice. Where Congress has both established a right and provided
exclusive remedies for its violation, we would encroach upon the prerogatives of Congress
were we to authorize a remedy not provided for by statute. United States v. Chanen, 549 F.2d
1306, 1313 (9th Cir.), cert. denied, 434 U.S. 825, 98 S.Ct. 72, 54 L.Ed.2d 83 (1977).
The same principle was reiterated in U.S. v. Thompson:[12]
x x x When Congress specifically designates a remedy for one of its acts, courts
generally presume that it engaged in the necessary balancing of interests in determining what
the appropriate penalty should be. See Michaelian, 803 F.2d at 1049 (citing cases); Frazin, 780
F.2d at 1466. Absent a specific reference to an exclusionary rule, it is not appropriate for the
courts to read such a provision into the act.
Even assuming arguendo, however, that the exclusionary rule applies in principle to cases involving
R.A. 1405, the Court finds no reason to apply the same in this particular case.
Clearly, the fruit of the poisonous tree doctrine[13] presupposes a violation of law. If there was no
violation of R.A. 1405 in the instant case, then there would be no poisonous tree to begin with, and, thus, no
reason to apply the doctrine.
How the Ombudsman conducted his inquiry into the bank accounts of petitioner is recounted by
respondent People of the Philippines, viz:
x x x [A]s early as February 8, 2001, long before the issuance of the Marquez ruling, the Office of the
Ombudsman, acting under the powers granted to it by the Constitution and R.A. No. 6770, and
acting on information obtained from various sources, including impeachment (of then Pres.
Joseph Estrada) related reports, articles and investigative journals, issued a Subpoena Duces
Tecum addressed to Urban Bank. (Attachment 1-b) It should be noted that the description of
the documents sought to be produced at that time included that of numbered accounts 727,
737, 747, 757, 777 and 858 and included such names as Jose Velarde, Joseph E. Estrada,
Laarni Enriquez, Guia Gomez, Joy Melendrez, Peachy Osorio, Rowena Lopez, Kevin or Kelvin
Garcia. The subpoena did not single out account 858.
xxxx
Thus, on February 13, 2001, PDIC, as receiver of Urban Bank, issued a certification as to the
availability of bank documents relating to A/C 858 and T/A 858 and the non-availability of
bank records as to the other accounts named in the subpoena. (Attachments 2, 2-1 and 2-b)
Based on the certification issued by PDIC, the Office of the Ombudsman on February 16, 2001 again
issued a Subpoena Duces Tecum directed to Ms. Corazon dela Paz, as Interim Receiver,
directing the production of documents pertinent to account A/C 858 and T/C
858. (Attachment 3)
In compliance with the said subpoena dated February 16, 2001, Ms. Dela Paz, as interim receiver,
furnished the Office of the Ombudsman certified copies of documents under cover latter
dated February 21, 2001:
1. Transaction registers dated 7-02-99, 8-16-99, 9-17-99, 10-18-99, 11-22-99, 1-
07-00, 04-03-00 and 04-24-00;
2. Report of Unregularized TAFs & TDs for UR COIN A & B Placements of Various
Branches as of February 29, 2000 and as of December 16, 1999; and
3. Trading Orders Nos. A No. 78102 and A No. 078125.
Trading Order A No. 07125 is filed in two copies a white copy which showed set up
information; and a yellow copy which showed reversal information. Both copies
have been reproduced and are enclosed with this letter.
We are continuing our search for other records and documents pertinent to your
request and we will forward to you on Friday, 23 February 2001, such additional
records and documents as we might find until then. (Attachment 4)
The Office of the Ombudsman then requested for the mangers checks, detailed in
the Subpoena Duces Tecum dated March 7, 2001. (Attachment 5)
PDIC again complied with the said Subpoena Duces Tecum dated March 7, 2001 and provided
copies of the managers checks thus requested under cover letter dated March 16,
2001. (Attachment 6)[14] (Emphasis in the original)
The Sandiganbayan credited the foregoing account of respondent People.[15] The Court finds no reason
to disturb this finding of fact by the Sandiganbayan.
The Marquez ruling notwithstanding, the above-described examination by the Ombudsman of petitioners bank
accounts, conducted before a case was filed with a court of competent jurisdiction, was lawful.
For the Ombudsman issued the subpoenas bearing on the bank accounts of petitioner about four
months before Marquez was promulgated on June 27, 2001.
While judicial interpretations of statutes, such as that made in Marquez with respect to R.A. No. 6770
or the Ombudsman Act of 1989, are deemed part of the statute as of the date it was originally passed, the rule is
not absolute.
Columbia Pictures, Inc. v. Court of Appeals[16] teaches:
It is consequently clear that a judicial interpretation becomes a part of the law as of the date
that law was originally passed, subject only to the qualification that when a doctrine of
this Court is overruled and a different view is adopted, and more so when there is
a reversal thereof, the new doctrine should be applied prospectively and should not
apply to parties who relied on the old doctrine and acted in good faith. (Emphasis and
underscoring supplied)
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
When this Court construed the Ombudsman Act of 1989, in light of the Secrecy of Bank Deposits Law in Marquez,
that before an in camera inspection may be allowed there must be a pending case before a court of competent
jurisdiction, it was, in fact, reversing an earlier doctrine found in Banco Filipino Savings and Mortgage Bank v.
Purisima[17].
Banco Filipino involved subpoenas duces tecum issued by the Office of the Ombudsman, then known as
the Tanodbayan,[18] in the course of its preliminary investigation of a charge of violation of the Anti-Graft and
Corrupt Practices Act.
While the main issue in Banco Filipino was whether R.A. 1405 precluded the Tanodbayans issuance
of subpoena duces tecum of bank records in the name of persons other than the one who was charged, this
Court, citing P.D. 1630,[19] Section 10, the relevant part of which states:
(d) He may issue a subpoena to compel any person to appear, give sworn testimony,
or produce documentary or other evidence the Tanodbayan deems relevant to a matter under
his inquiry,
held that The power of the Tanodbayan to issue subpoenae ad testificandum and subpoenae duces tecum
at the time in question is not disputed, and at any rate does not admit of doubt.[20]
As the subpoenas subject of Banco Filipino were issued during a preliminary investigation, in effect this
Court upheld the power of the Tandobayan under P.D. 1630 to issue subpoenas duces tecum for bank
documents prior to the filing of a case before a court of competent jurisdiction.
Marquez, on the other hand, practically reversed this ruling in Banco Filipino despite the fact that the
subpoena power of the Ombudsman under R.A. 6770 was essentially the same as that under P.D. 1630. Thus
Section 15 of R.A. 6770 empowers the Office of the Ombudsman to
(8) Administer oaths, issue subpoena and subpoena duces tecum, and take testimony in any
investigation or inquiry, including the power to examine and have access to bank accounts
and records;
A comparison of this provision with its counterpart in Sec. 10(d) of P.D. 1630 clearly shows that it is only more
explicit in stating that the power of the Ombudsman includes the power to examine and have access to bank
accounts and records which power was recognized with respect to the Tanodbayan through Banco Filipino.
The Marquez ruling that there must be a pending case in order for the Ombudsman to validly inspect bank
records in camera thus reversed a prevailing doctrine.[21] Hence, it may not be retroactively applied.
The Ombudsmans inquiry into the subject bank accounts prior to the filing of any case before a court of
competent jurisdiction was therefore valid at the time it was conducted.
Likewise, the Marquez ruling that the account holder must be notified to be present during the inspection may
not be applied retroactively to the inquiry of the Ombudsman subject of this case. This ruling is not a judicial
interpretation either of R.A. 6770 or R.A. 1405, but a judge-made law which, as People v. Luvendino[22] instructs,
can only be given prospective application:
x x x The doctrine that an uncounselled waiver of the right to counsel is not to be given
legal effect was initially a judge-made one and was first announced on 26 April
1983 in Morales v. Enrile and reiterated on 20 March 1985 in People v. Galit. x x x
While the Morales-Galit doctrine eventually became part of Section 12(1) of the 1987
Constitution, that doctrine affords no comfort to appellant Luvendino for the requirements
and restrictions outlined in Morales and Galit have no retroactive effect and do not
reach waivers made prior to 26 April 1983 the date of promulgation of Morales. (Emphasis
supplied)
In fine, the subpoenas issued by the Ombudsman in this case were legal, hence, invocation of the fruit
of the poisonous tree doctrine is misplaced.
AT ALL EVENTS, even if the challenged subpoenas are quashed, the Ombudsman is not barred from
requiring the production of the same documents based solely on information obtained by it from
sources independent of its previous inquiry.
In particular, the Ombudsman, even before its inquiry, had already possessed information giving him grounds to
believe that (1) there are bank accounts bearing the number 858, (2) that such accounts are in the custody of
Urban Bank, and (3) that the same are linked with the bank accounts of former President Joseph Estrada who
was then under investigation for plunder.
Only with such prior independent information could it have been possible for the Ombudsman to issue
the February 8, 2001 subpoena duces tecum addressed to the President and/or Chief Executive Officer of Urban
Bank, which described the documents subject thereof as follows:
(a) bank records and all documents relative thereto pertaining to all bank accounts
(Savings, Current, Time Deposit, Trust, Foreign Currency Deposits, etc) under the account
names of Jose Velarde, Joseph E. Estrada, Laarni Enriquez, Guia Gomez, Joy Melendrez, Peach
Osorio, Rowena Lopez, Kevin or Kelvin Garcia, 727, 737, 747, 757, 777 and 858. (Emphasis
and underscoring supplied)
The information on the existence of Bank Accounts bearing number 858 was, according to respondent People of
the Philippines, obtained from various sources including the proceedings during the impeachment of President
Estrada, related reports, articles and investigative journals.[23] In the absence of proof to the contrary, this
explanation proffered by respondent must be upheld. To presume that the information was obtained in violation
of R.A. 1405 would infringe the presumption of regularity in the performance of official functions.
Thus, with the filing of the plunder case against former President Estrada before the Sandiganbayan, the
Ombudsman, using the above independent information, may now proceed to conduct the same investigation it
earlier conducted, through which it can eventually obtain the same information previously disclosed to it by the
PDIC, for it is an inescapable fact that the bank records of petitioner are no longer protected by R.A. 1405 for the
reasons already explained above.
Since conducting such an inquiry would, however, only result in the disclosure of the same documents
to the Ombudsman, this Court, in avoidance of what would be a time-wasteful and circuitous way of
administering justice,[24] upholds the challenged subpoenas.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

Respecting petitioners claim that the Sandiganbayan violated his right to due process as he was neither
notified of the requests for the issuance of the subpoenas nor of the grant thereof, suffice it to state that the
defects were cured when petitioner ventilated his arguments against the issuance thereof through his earlier
quoted letter addressed to the Sandiganbayan and when he filed his motions to quash before the Sandiganbayan.

IN SUM, the Court finds that the Sandiganbayan did not commit grave abuse of discretion in issuing the
challenged subpoenas for documents pertaining to petitioners Trust Account No. 858 and Savings Account No.
0116-17345-9 for the following reasons:

1. These accounts are no longer protected by the Secrecy of Bank Deposits Law, there being two
exceptions to the said law applicable in this case, namely: (1) the examination of bank accounts is upon order of
a competent court in cases of bribery or dereliction of duty of public officials, and (2) the money deposited or
invested is the subject matter of the litigation. Exception (1) applies since the plunder case pending against
former President Estrada is analogous to bribery or dereliction of duty, while exception (2) applies because the
money deposited in petitioners bank accounts is said to form part of the subject matter of the same plunder
case.

2. The fruit of the poisonous tree principle, which states that once the primary source (the tree) is
shown to have been unlawfully obtained, any secondary or derivative evidence (the fruit) derived from it is also
inadmissible, does not apply in this case. In the first place, R.A. 1405 does not provide for the application of this
rule. Moreover, there is no basis for applying the same in this case since the primary source for the detailed
information regarding petitioners bank accounts the investigation previously conducted by the Ombudsman
was lawful.

3. At all events, even if the subpoenas issued by the Sandiganbayan were quashed, the Ombudsman
may conduct on its own the same inquiry into the subject bank accounts that it earlier conducted last February-
March 2001, there being a plunder case already pending against former President Estrada. To quash the
challenged subpoenas would, therefore, be pointless since the Ombudsman may obtain the same documents by
another route. Upholding the subpoenas avoids an unnecessary delay in the administration of justice.

WHEREFORE, the petition is DISMISSED. The Sandiganbayan Resolutions dated February 7 and 12,
2003 and March 11, 2003 are upheld.

The Sandiganbayan is hereby directed, consistent with this Courts ruling in Marquez v. Desierto, to
notify petitioner as to the date the subject bank documents shall be presented in court by the persons
subpoenaed.

SO ORDERED.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
2. CECILIA ZULUETA, vs. COURT OF APPEALS and ALFREDO MARTIN, G.R. No. 107383. February
20, 1996
MENDOZA, J.:
This is a petition to review the decision of the Court of Appeals, affirming the decision of the Regional Trial
Court of Manila (Branch X) which ordered petitioner to return documents and papers taken by her from private
respondents clinic without the latters knowledge and consent.
The facts are as follows:
Petitioner Cecilia Zulueta is the wife of private respondent Alfredo Martin. On March 26, 1982, petitioner
entered the clinic of her husband, a doctor of medicine, and in the presence of her mother, a driver and private
respondents secretary, forcibly opened the drawers and cabinet in her husbands clinic and took 157 documents
consisting of private correspondence between Dr. Martin and his alleged paramours, greetings cards, cancelled
checks, diaries, Dr. Martins passport, and photographs. The documents and papers were seized for use in
evidence in a case for legal separation and for disqualification from the practice of medicine which petitioner
had filed against her husband.
Dr. Martin brought this action below for recovery of the documents and papers and for damages against
petitioner. The case was filed with the Regional Trial Court of Manila, Branch X, which, after trial, rendered
judgment for private respondent, Dr. Alfredo Martin, declaring him the capital/exclusive owner of the properties
described in paragraph 3 of plaintiffs Complaint or those further described in the Motion to Return and Suppress
and ordering Cecilia Zulueta and any person acting in her behalf to immediately return the properties to Dr.
Martin and to pay him P5,000.00, as nominal damages; P5,000.00, as moral damages and attorneys fees; and to
pay the costs of the suit. The writ of preliminary injunction earlier issued was made final and petitioner Cecilia
Zulueta and her attorneys and representatives were enjoined from using or submitting/admitting as evidence
the documents and papers in question. On appeal, the Court of Appeals affirmed the decision of the Regional
Trial Court. Hence this petition.
There is no question that the documents and papers in question belong to private respondent, Dr. Alfredo
Martin, and that they were taken by his wife, the herein petitioner, without his knowledge and consent. For that
reason, the trial court declared the documents and papers to be properties of private respondent, ordered
petitioner to return them to private respondent and enjoined her from using them in evidence. In appealing
from the decision of the Court of Appeals affirming the trial courts decision, petitioners only ground is that
in Alfredo Martin v. Alfonso Felix, Jr.,1 this Court ruled that the documents and papers (marked as Annexes A-i to
J-7 of respondents comment in that case) were admissible in evidence and, therefore, their use by petitioners
attorney, Alfonso Felix, Jr., did not constitute malpractice or gross misconduct. For this reason it is contended
that the Court of Appeals erred in affirming the decision of the trial court instead of dismissing private
respondents complaint.
Petitioners contention has no merit. The case against Atty. Felix, Jr. was for disbarment. Among other
things, private respondent, Dr. Alfredo Martin, as complainant in that case, charged that in using the documents
in evidence, Atty. Felix, Jr. committed malpractice or gross misconduct because of the injunctive order of the trial
court. In dismissing the complaint against Atty. Felix, Jr., this Court took note of the following defense of Atty.
Felix, Jr. which it found to be impressed with merit:2
On the alleged malpractice or gross misconduct of respondent [Alfonso Felix, Jr.], he maintains that:
xxx xxx xxx
4. When respondent refiled Cecilias case for legal separation before the Pasig Regional Trial Court, there was
admittedly an order of the Manila Regional Trial Court prohibiting Cecilia from using the documents Annex A-I
to J-7. On September 6, 1983, however having appealed the said order to this Court on a petition for certiorari,
this Court issued a restraining order on aforesaid date which order temporarily set aside the order of the trial
court. Hence, during the enforceability of this Courts order, respondents request for petitioner to admit the
genuineness and authenticity of the subject annexes cannot be looked upon as malpractice. Notably, petitioner
Dr. Martin finally admitted the truth and authenticity of the questioned annexes. At that point in time, would it
have been malpractice for respondent to use petitioners admission as evidence against him in the legal
separation case pending in the Regional Trial Court of Makati? Respondent submits it is- not malpractice.
Significantly, petitioners admission was done not thru his counsel but by Dr. Martin himself under oath.
Such verified admission constitutes an affidavit, and, therefore, receivable in evidence against him. Petitioner
became bound by his admission. For Cecilia to avail herself of her husbands admission and use the same in her
action for legal separation cannot be treated as malpractice.
Thus, the acquittal of Atty. Felix, Jr. in the administrative case amounts to no more than a declaration that
his use of the documents and papers for the purpose of securing Dr. Martins admission as to their genuiness and
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

authenticity did not constitute a violation of the injunctive order of the trial court. By no means does the Plaintiff Soccoro D. Ramirez (Chuchi) — Good Afternoon M'am.
decision in that case establish the admissibility of the documents and papers in question.
It cannot be overemphasized that if Atty. Felix, Jr. was acquitted of the charge of violating the writ of Defendant Ester S. Garcia (ESG) — Ano ba ang nangyari sa 'yo, nakalimot ka na kung paano ka
preliminary injunction issued by the trial court, it was only because, at the time he used the documents and napunta rito, porke member ka na, magsumbong ka kung ano ang gagawin ko sa 'yo.
papers, enforcement of the order of the trial court was temporarily restrained by this Court. The TRO issued by
this Court was eventually lifted as the petition for certiorari filed by petitioner against the trial courts order was CHUCHI — Kasi, naka duty ako noon.
dismissed and, therefore, the prohibition against the further use of the documents and papers became effective
again. ESG — Tapos iniwan no. (Sic)
Indeed the documents and papers in question are inadmissible in evidence. The constitutional injunction
declaring the privacy of communication and correspondence [to be] inviolable 3 is no less applicable simply CHUCHI — Hindi m'am, pero ilan beses na nila akong binalikan, sabing ganoon —
because it is the wife (who thinks herself aggrieved by her husbands infidelity) who is the party against whom
the constitutional provision is to be enforced. The only exception to the prohibition in the Constitution is if there ESG — Ito and (sic) masasabi ko sa 'yo, ayaw kung (sic) mag explain ka, kasi hanggang 10:00 p.m.,
is a lawful order [from a] court or when public safety or order requires otherwise, as prescribed by law. 4 Any kinabukasan hindi ka na pumasok. Ngayon ako ang babalik sa 'yo, nag-aaply ka sa States, nag-aaply ka
violation of this provision renders the evidence obtained inadmissible for any purpose in any proceeding. 5 sa review mo, kung kakailanganin ang certification mo, kalimutan mo na kasi hindi ka sa akin
The intimacies between husband and wife do not justify any one of them in breaking the drawers and makakahingi.
cabinets of the other and in ransacking them for any telltale evidence of marital infidelity. A person, by
contracting marriage, does not shed his/her integrity or his right to privacy as an individual and the CHUCHI — Hindi M'am. Kasi ang ano ko talaga noon i-cocontinue ko up to 10:00 p.m.
constitutional protection is ever available to him or to her.
ESG — Bastos ka, nakalimutan mo na kung paano ka pumasok dito sa hotel. Magsumbong ka sa Union
The law insures absolute freedom of communication between the spouses by making it privileged. Neither
kung gusto mo. Nakalimutan mo na kung paano ka nakapasok dito "Do you think that on your own
husband nor wife may testify for or against the other without the consent of the affected spouse while the
makakapasok ka kung hindi ako. Panunumbyoyan na kita (Sinusumbatan na kita).
marriage subsists.6 Neither may be examined without the consent of the other as to any communication received
in confidence by one from the other during the marriage, save for specified exceptions.7 But one thing is freedom
of communication; quite another is a compulsion for each one to share what one knows with the other. And this CHUCHI — Itutuloy ko na M'am sana ang duty ko.
has nothing to do with the duty of fidelity that each owes to the other.
ESG — Kaso ilang beses na akong binabalikan doon ng mga no (sic) ko.
WHEREFORE, the petition for review is DENIED for lack of merit.
SO ORDERED. ESG — Nakalimutan mo na ba kung paano ka pumasok sa hotel, kung on your own merit alam ko
naman kung gaano ka "ka bobo" mo. Marami ang nag-aaply alam kong hindi ka papasa.

CHUCHI — Kumuha kami ng exam noon.

3. RAMIREZ VS CA G.R. No. 93833 September 28, 1995 ESG — Oo, pero hindi ka papasa.

KAPUNAN, J.: CHUCHI — Eh, bakit ako ang nakuha ni Dr. Tamayo

A civil case damages was filed by petitioner Socorro D. Ramirez in the Regional Trial Court of Quezon City ESG — Kukunin ka kasi ako.
alleging that the private respondent, Ester S. Garcia, in a confrontation in the latter's office, allegedly vexed,
insulted and humiliated her in a "hostile and furious mood" and in a manner offensive to petitioner's dignity and
CHUCHI — Eh, di sana —
personality," contrary to morals, good customs and public policy."1

ESG — Huwag mong ipagmalaki na may utak ka kasi wala kang utak. Akala mo ba makukuha ka dito
In support of her claim, petitioner produced a verbatim transcript of the event and sought moral damages,
kung hindi ako.
attorney's fees and other expenses of litigation in the amount of P610,000.00, in addition to costs, interests and
other reliefs awardable at the trial court's discretion. The transcript on which the civil case was based was culled
from a tape recording of the confrontation made by petitioner.2 The transcript reads as follows: CHUCHI — Mag-eexplain ako.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
ESG — Huwag na, hindi ako mag-papa-explain sa 'yo, makaalala ka kung paano ka puma-rito. "Putang-
ina" sasabi-sabihin mo kamag-anak ng nanay at tatay mo ang mga magulang ko.
ESG — Wala na akong pakialam, dahil nandito ka sa loob, nasa labas ka puwede ka ng hindi pumasok,
okey yan nasaloob ka umalis ka doon.
CHUCHI — Kasi M'am, binbalikan ako ng mga taga Union.
ESG — Nandiyan na rin ako, pero huwag mong kalimutan na hindi ka makakapasok kung hindi ako.
Kung hindi mo kinikilala yan okey lang sa akin, dahil tapos ka na.
CHUCHI — Ina-ano ko m'am na utang na loob.
ESG — Huwag na lang, hindi mo utang na loob, kasi kung baga sa no, nilapastangan mo ako.
CHUCHI — Paano kita nilapastanganan?
ESG — Mabuti pa lumabas ka na. Hindi na ako makikipagusap sa 'yo. Lumabas ka na. Magsumbong
ka.3
As a result of petitioner's recording of the event and alleging that the said act of secretly taping the confrontation
was illegal, private respondent filed a criminal case before the Regional Trial Court of Pasay City for violation of
Republic Act 4200, entitled "An Act to prohibit and penalize wire tapping and other related violations of private
communication, and other purposes." An information charging petitioner of violation of the said Act, dated
October 6, 1988 is quoted herewith:
INFORMATION
The Undersigned Assistant City Fiscal Accusses Socorro D. Ramirez of Violation of Republic
Act No. 4200, committed as follows:
That on or about the 22nd day of February, 1988, in Pasay City Metro
Manila, Philippines, and within the jurisdiction of this honorable court, the
above-named accused, Socorro D. Ramirez not being authorized by Ester S.
Garcia to record the latter's conversation with said accused, did then and
there willfully, unlawfully and feloniously, with the use of a tape recorder
secretly record the said conversation and thereafter communicate in
writing the contents of the said recording to other person.
Contrary to law.
Pasay City, Metro Manila, September 16, 1988.
MARIANO M.
CUNETA
Asst. City Fiscal
Upon arraignment, in lieu of a plea, petitioner filed a Motion to Quash the Information on the ground that the
facts charged do not constitute an offense, particularly a violation of R.A. 4200. In an order May 3, 1989, the trial
court granted the Motion to Quash, agreeing with petitioner that 1) the facts charged do not constitute an
offense under R.A. 4200; and that 2) the violation punished by R.A. 4200 refers to a the taping of a
communication by a person other than a participant to the communication.4
From the trial court's Order, the private respondent filed a Petition for Review on Certiorari with this Court,
which forthwith referred the case to the Court of Appeals in a Resolution (by the First Division) of June 19, 1989.
On February 9, 1990, respondent Court of Appeals promulgated its assailed Decision declaring the trial court's
order of May 3, 1989 null and void, and holding that:
[T]he allegations sufficiently constitute an offense punishable under Section 1 of R.A. 4200. In
thus quashing the information based on the ground that the facts alleged do not constitute an
offense, the respondent judge acted in grave abuse of discretion correctible by certiorari.5
Consequently, on February 21, 1990, petitioner filed a Motion for Reconsideration which respondent Court of
Appeals denied in its Resolution6 dated June 19, 1990. Hence, the instant petition.
Petitioner vigorously argues, as her "main and principal issue"7 that the applicable provision of Republic Act
4200 does not apply to the taping of a private conversation by one of the parties to the conversation. She
contends that the provision merely refers to the unauthorized taping of a private conversation by a party other
than those involved in the communication.8 In relation to this, petitioner avers that the substance or content of
the conversation must be alleged in the Information, otherwise the facts charged would not constitute a
violation of R.A. 4200.9 Finally, petitioner agues that R.A. 4200 penalizes the taping of a "private
communication," not a "private conversation" and that consequently, her act of secretly taping her conversation
with private respondent was not illegal under the said act. 10
We disagree.
First, legislative intent is determined principally from the language of a statute. Where the language of a statute
is clear and unambiguous, the law is applied according to its express terms, and interpretation would be
resorted to only where a literal interpretation would be either impossible 11 or absurb or would lead to an
injustice. 12
Section 1 of R.A. 4200 entitled, " An Act to Prohibit and Penalized Wire Tapping and Other Related Violations of
Private Communication and Other Purposes," provides:
Sec. 1. It shall be unlawfull for any person, not being authorized by all the parties to any
private communication or spoken word, to tap any wire or cable, or by using any other device
or arrangement, to secretly overhear, intercept, or record such communication or spoken
word by using a device commonly known as a dictaphone or dictagraph or detectaphone or
walkie-talkie or tape recorder, or however otherwise described.
The aforestated provision clearly and unequivocally makes it illegal for any person, not authorized by all the
parties to any private communication to secretly record such communication by means of a tape recorder. The
law makes no distinction as to whether the party sought to be penalized by the statute ought to be a party other
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
than or different from those involved in the private communication. The statute's intent to penalize all persons
unauthorized to make such recording is underscored by the use of the qualifier "any". Consequently, as
respondent Court of Appeals correctly concluded, "even a (person) privy to a communication who records his
private conversation with another without the knowledge of the latter (will) qualify as a violator" 13 under this
provision of R.A. 4200.
A perusal of the Senate Congressional Records, moreover, supports the respondent court's conclusion that in
enacting R.A. 4200 our lawmakers indeed contemplated to make illegal, unauthorized tape recording of private
conversations or communications taken either by the parties themselves or by third persons. Thus:
xxx xxx xxx
Senator Tañada: That qualified only "overhear".
Senator Padilla: So that when it is intercepted or recorded, the element of secrecy would not
appear to be material. Now, suppose, Your Honor, the recording is not made by all the parties
but by some parties and involved not criminal cases that would be mentioned under section 3
but would cover, for example civil cases or special proceedings whereby a recording is made
not necessarily by all the parties but perhaps by some in an effort to show the intent of the
parties because the actuation of the parties prior, simultaneous even subsequent to the
contract or the act may be indicative of their intention. Suppose there is such a recording,
would you say, Your Honor, that the intention is to cover it within the purview of this bill or
outside?
Senator Tañada: That is covered by the purview of this bill, Your Honor.
Senator Padilla: Even if the record should be used not in the prosecution of offense but as
evidence to be used in Civil Cases or special proceedings?
Senator Tañada: That is right. This is a complete ban on tape recorded conversations taken
without the authorization of all the parties.
Senator Padilla: Now, would that be reasonable, your Honor?
Senator Tañada: I believe it is reasonable because it is not sporting to record the observation of
one without his knowing it and then using it against him. It is not fair, it is not sportsmanlike. If
the purpose; Your honor, is to record the intention of the parties. I believe that all the parties
should know that the observations are being recorded.
Senator Padilla: This might reduce the utility of recorders.
Senator Tañada: Well no. For example, I was to say that in meetings of the board of directors
where a tape recording is taken, there is no objection to this if all the parties know. It is but
fair that the people whose remarks and observations are being made should know that the
observations are being recorded.
Senator Padilla: Now, I can understand.
Senator Tañada: That is why when we take statements of persons, we say: "Please be
informed that whatever you say here may be used against you." That is fairness and that is
what we demand. Now, in spite of that warning, he makes damaging statements against his
own interest, well, he cannot complain any more. But if you are going to take a recording of the
observations and remarks of a person without him knowing that it is being taped or recorded,
without him knowing that what is being recorded may be used against him, I think it is unfair.
xxx xxx xxx
(Congression Record, Vol. III, No. 31, p. 584, March 12, 1964)
Senator Diokno: Do you understand, Mr. Senator, that under Section 1 of the bill as now
worded, if a party secretly records a public speech, he would be penalized under Section 1?
Because the speech is public, but the recording is done secretly.
Senator Tañada: Well, that particular aspect is not contemplated by the bill. It is the
communication between one person and another person — not between a speaker and a public.
xxx xxx xxx
(Congressional Record, Vol. III, No. 33, p. 626, March 12, 1964)
xxx xxx xxx
The unambiguity of the express words of the provision, taken together with the above-quoted deliberations
from the Congressional Record, therefore plainly supports the view held by the respondent court that the
provision seeks to penalize even those privy to the private communications. Where the law makes no
distinctions, one does not distinguish.
Second, the nature of the conversations is immaterial to a violation of the statute. The substance of the same
need not be specifically alleged in the information. What R.A. 4200 penalizes are the acts of secretly overhearing,
intercepting or recording private communications by means of the devices enumerated therein. The mere
allegation that an individual made a secret recording of a private communication by means of a tape recorder
would suffice to constitute an offense under Section 1 of R.A. 4200. As the Solicitor General pointed out in his
COMMENT before the respondent court: "Nowhere (in the said law) is it required that before one can be
regarded as a violator, the nature of the conversation, as well as its communication to a third person should be
professed." 14
Finally, petitioner's contention that the phrase "private communication" in Section 1 of R.A. 4200 does not
include "private conversations" narrows the ordinary meaning of the word "communication" to a point of
absurdity. The word communicate comes from the latin word communicare, meaning "to share or to impart." In
its ordinary signification, communication connotes the act of sharing or imparting signification, communication
connotes the act of sharing or imparting, as in a conversation, 15 or signifies the "process by which meanings or
thoughts are shared between individuals through a common system of symbols (as language signs or
gestures)" 16 These definitions are broad enough to include verbal or non-verbal, written or expressive
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
communications of "meanings or thoughts" which are likely to include the emotionally-charged exchange, on
February 22, 1988, between petitioner and private respondent, in the privacy of the latter's office. Any doubts
about the legislative body's meaning of the phrase "private communication" are, furthermore, put to rest by the
fact that the terms "conversation" and "communication" were interchangeably used by Senator Tañada in his
Explanatory Note to the bill quoted below:
It has been said that innocent people have nothing to fear from their conversations being
overheard. But this statement ignores the usual nature of conversations as well the
undeniable fact that most, if not all, civilized people have some aspects of their lives they do
not wish to expose. Free conversationsare often characterized by exaggerations, obscenity,
agreeable falsehoods, and the expression of anti-social desires of views not intended to be
taken seriously. The right to the privacy of communication, among others, has expressly been
assured by our Constitution. Needless to state here, the framers of our Constitution must have
recognized the nature of conversations between individuals and the significance of man's
spiritual nature, of his feelings and of his intellect. They must have known that part of the
pleasures and satisfactions of life are to be found in the unaudited, and free exchange
of communication between individuals — free from every unjustifiable intrusion by whatever
means.17
In Gaanan vs. Intermediate Appellate Court, 18 a case which dealt with the issue of telephone wiretapping, we
held that the use of a telephone extension for the purpose of overhearing a private conversation without
authorization did not violate R.A. 4200 because a telephone extension devise was neither among those
"device(s) or arrangement(s)" enumerated therein, 19 following the principle that "penal statutes must be
construed strictly in favor of the accused."20 The instant case turns on a different note, because the applicable
facts and circumstances pointing to a violation of R.A. 4200 suffer from no ambiguity, and the statute itself
explicitly mentions the unauthorized "recording" of private communications with the use of tape-recorders as
among the acts punishable.
WHEREFORE, because the law, as applied to the case at bench is clear and unambiguous and leaves us with no
discretion, the instant petition is hereby DENIED. The decision appealed from is AFFIRMED. Costs against
petitioner.
SO ORDERED.
4. SALITA VS MAGTOLIS GR NO. 106429 JUNE 13,1994
BELLOSILLO, J.:
Erwin Espinosa, 32, and Joselita Salita, 22, were married at the Roman Catholic Church in Ermita, Manila, on 25
January 1986. A year later, their union turned sour. They separated in fact in 1988. Subsequently, Erwin sued for
annulment on the ground of Joselita’s psychological incapacity.
The issue before us however is not the scope nor even the interpretation of Art. 36 of the Family Code. 1 Rather,
the issue is the sufficiency of the allegations in the petition for annulment of marriage and the subsequent bill of
particulars filed in amplification of the petition.
The petition for annulment was filed before the Regional Trial Court of Quezon City on 7 January 1992. Therein
it is alleged that "[s]ometime in 1987, petitioner came to realize that respondent was psychologically
incapacitated to comply with the essential marital obligations of their marriage, which incapacity existed at the
time of the marriage although the same became manifest only thereafter." 2 Dissatisfied with the allegation in
the petition, Joselita moved for a bill of particulars which the trial court granted. 3 Subsequently, in his Bill of
Particulars, Edwin specified that —
. . . at the time of their marriage, respondent (Joselita Salita) was psychologically
incapacitated to comply with the essential marital obligations of their marriage in that she
was unable to understand and accept the demands made by his profession — that of a newly
qualified Doctor of Medicine — upon petitioner’s time and efforts so that she frequently
complained of his lack of attention to her even to her mother, whose intervention caused
petitioner to lose his job.
Still Joselita was not contented with the Bill of Particulars. She argued that the "assertion (in the Bill of
Particulars) is a statement of legal conclusion made by petitioner’s counsel and not an averment of ‘ultimate
facts,’ as required by the Rules of Court, from which such a conclusion may properly be inferred . . . ." 4 But
finding the questioned Bill of Particulars adequate, the trial court issued an order upholding its sufficiency and
directing Joselita to file her responsive pleading.
Joselita was not convinced. She filed a petition for certiorari with us. However, we referred her petition to the
Court of Appeals for resolution.
On 21 July 1992, the Court of Appeals denied due course to her petition thus —
In the case under consideration, Espinosa has amplified Salita’s alleged psychological
incapacity in his bill of particulars . . .
In our view, the aforesaid specification more than satisfies the Rules’ requirement that a
complaint must allege the ultimate facts constituting a plaintiff’s cause of action. To require
more details thereof, to insist on a specification of Salita’s particular conduct or behavior with
the corresponding ‘circumstances of time, place and person’ indicating her alleged
psychological incapacity would be to ask for information on evidentiary matters. To obtain
evidentiary details, Salita may avail herself of the different modes of discovery provided by
the Rules of Court
(Rules 24 to 28).
Whether Espinosa’s averments in his bill of particulars constitute psychological incapacity in
the contemplation of the Family Code is a question that may be resolved in a motion to
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
dismiss or after trial on the merits of the case, not in a motion for bill of particulars. And
certainly, that matter cannot be resolved in the present petition. 5
Hence, the instant petition for review on certiorari filed by Joselita Salita questioning the Resolution of the Court
of Appeals denying due course to her petition.
Petitioner insists that the allegations in the Bill of Particulars constitute a legal conclusion, not an averment of
facts, and fail to point out the specific essential marital obligations she allegedly was not able to perform, and
thus render the Bill of Particulars insufficient if not irrelevant to her husband’s cause of action. She rationalizes
that her insistence on the specification of her particular conduct or behavior with the corresponding
circumstances of time, place and person does not call for information on evidentiary matters because without
these details she cannot adequately and intelligently prepare her answer to the petition.
Private respondent on the other hand believes that his allegations in the Bill of Particulars constitute the
ultimate facts which the Rules of Court requires at this point. He defines ultimate facts as —
. . . important and substantial facts which either directly form the basis of the primary right
and duty, or which directly make upon the wrongful acts or omissions of the defendant. The
term does not refer to the details of probative matter or particulars of evidence by which
these material elements are to be established. It refers to principal, determinate facts upon
the existence of which the entire cause of action rests. 6
Ultimate facts are conclusions drawn from intermediate and evidentiary facts, or allegations
of mixed law and fact; they are conclusions from reflection and natural reasoning on
evidentiary fact. The ultimate facts which are to be pleaded are the issuable, constitutive, or
traversible facts essential to the statement of the cause of action; the facts which the evidence
on the trial will prove, and not the evidence which will be required to prove the existence of
those facts . . . 7
Private respondent further argues that "[c]onclusions of law and evidentiary matters need not be stated in the
complaint. The rules of pleading limit the statement of the cause of action only to such operative facts as would
give rise to the right of action of the plaintiff to obtain relief against the wrongdoer. The details of probative
matter or particulars of evidence, statements of law, inferences and arguments need not be stated." 8
In a nutshell, the ultimate question is whether the Bill of Particulars submitted by herein respondent is of
sufficient definiteness or particularity as to enable herein petitioner to properly prepare her responsive
pleading or for trial.
A complaint only needs to state the "ultimate facts constituting the plaintiff’s cause or causes of
action." 9 Ultimate facts has been defined as "those facts which the expected evidence will support." 10 As stated
by private respondent, "[t]he term does not refer to the details of probative matter or particulars of evidence by
which these material elements are to be established." It refers to "the facts which the evidence on the trial will
prove, and not the evidence which will be required to prove the existence of those facts." And a motion for bill of
particulars will not be granted if the complaint, while not very definite, nonetheless already states a sufficient
cause of action. 11 A motion for bill of particulars may not call for matters which should form part of the proof of
the complaint upon trial. Such information may be obtained by other means. 12
We sustain the view of respondent Court of Appeals that the Bill of Particulars filed by private respondent is
sufficient to state a cause of action, and to require more details from private respondent would be to ask for
information on evidentiary matters. Indeed, petitioner has already been adequately apprised of private
respondent’s cause of action against her thus —
. . . . (she) was psychologically incapacitated to comply with the essential marital obligations
of their marriage in that she was unable to understand and accept the demands made by his
profession — that of a newly qualified Doctor of Medicine — upon petitioner’s time and
efforts so that she frequently complained of his lack of attention to her even to her mother,
whose intervention caused petitioner to lose his job.
On the basis of the aforequoted allegations, it is evident that petitioner can already prepare her responsive
pleading or for trial. Private respondent has already alleged that "she (petitioner) was unable to understand and
accept the demands made by his profession . . . upon his time and efforts . . . " Certainly, she can respond to this.
To demand for more details would indeed be asking for information on evidentiary facts — facts necessary to
prove essential or ultimate facts. 13 For sure, the additional facts called for by petitioner regarding her particular
acts or omissions would be evidentiary, and to obtain evidentiary matters is not the function of a motion for bill
of particulars. 14
We distinguish the instant case from Tantuico, Jr. v. Republic 15 where we said —
Furthermore, the particulars prayed for such as names of persons, names of corporations,
dates, amounts involved, a specification of property for identification purposes, the particular
transactions involving withdrawals and disbursements, and a statement of other material
facts as would support the conclusions and inferences in the complaint, are not evidentiary in
nature. On the contrary, those particulars are material facts that should be clearly and
definitely averred in the complaint in order that the defendant may, in fairness, be informed
of the claims made against him to the end that he may be prepared to meet the issues at the
trial.
The aforementioned pronouncement cannot apply to the instant case. That ruling involves alleged
"misappropriation and theft of public funds, plunder of the nation’s wealth, extortion, blackmail, bribery,
embezzlement, and other acts of corruption, betrayal of public trust and brazen abuse of power." The
respondents therein pray for reconveyance, reversion, accounting, restitution and damages. There, the alleged
illicit acts should be fully documented. The instant case, on the other hand, concerns marital relationship. It
would be unreasonable, if not unfeeling, to document each and every circumstance of marital disagreement.
True, the complaining spouse will have to prove his case, but that will not come until trial begins.
Consequently, we have no other recourse but to order the immediate resumption of the annulment proceeding
which have already been delayed for more than two years now, even before it could reach its trial stage.
Whether petitioner is psychologically incapacitated should be immediately determined. There is no point in
unreasonably delaying the resolution of the petition and prolonging the agony of the wedded couple who after
coming out from a storm still have the right to a renewed blissful life either alone or in the company of each
other.
A word on Art. 36 of the Family Code. 16 We do not see the need to define or limit the scope of the provision. Not
in this case, at least. For, we are not called upon to do so, the actual controversy being the sufficiency of the bill
of particulars. To interpret the provision at this juncture would be to give an obiter dictum which is ill-timed.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Besides, it appears that petitioner in her memorandum has demonstrated a good grasp of what Art. 36 actually
covers. Suffice it to say that Mme. Justice Sempio-Diy, formerly of the Court of Appeals and a member of the Civil
Code Revision Committee that drafted the Family code, explains —
The Committee did not give any examples of psychological incapacity for fear that the giving
of examples would limit the applicability of the provision under the principle of ejusdem
generis. Rather, the Committee would like the judge to interpret the provision on a case-to-
case basis, guided by experience, the findings of experts and researchers in psychological
disciplines, and by decisions of church tribunals which, although not binding on the civil
courts, may be given persuasive effect since the provision was taken from Canon Law. 17
WHEREFORE, there being no reversible error, the instant petition is DENIED and the questioned Resolution of
respondent Court of Appeals dated 21 July 1992 is AFFIRMED.
SO ORDERED.
5. TANTUICO VS REPUBLIC G.R. No. 89114 December 2, 1991
PADILLA, J.:
In this petition for certiorari, mandamus and prohibition with a prayer for the issuance of a writ of preliminary
injunction and/or restraining order, the petitioner seeks to annul and set aside the resolution of the
Sandiganbayan, dated 21 April 1989, denying his motion for a bill of particulars as well as its resolution, dated
29 May 1989, which denied his motion for reconsideration; to compel the respondent PCGG to prepare and file a
bill of particulars, or that said respondent be ordered to exclude petitioner as defendant in Civil Case No. 0035
should they fail to submit the said bill of particulars; and to enjoin the respondent Sandiganbayan from further
proceeding against petitioner until the bill of particulars is submitted, claiming that the respondent
Sandiganbayan acted with grave abuse of discretion amounting to lack of jurisdiction in promulgating the
aforesaid resolutions and that there is no appeal, nor any plain, speedy and adequate remedy for him in the
ordinary course of law other than the present petition.
As prayed for, this Court issued on 1 August 1989 a temporary restraining order "effective immediately and
continuing until further orders from this Court, ordering the respondent Sandiganbayan to CEASE and DESIST
from further proceeding in Civil Case No. 0035 (PCGG 35), entitled "Republic of the Philippines vs. Benjamin
(Kokoy) Romualdez, et al." pending before it. 1
The antecedents are as follows:
On 31 July 1987, the Republic of the Philippines, represented by the PCGG, and assisted by the Office of the Solicitor General, filed with the Sandiganbayan Civil Case No.
0035, entitled "Republic of the Philippines vs. Benjamin (Kokoy) Romualdez, et al." for reconveyance, reversion, accounting, restitution and damages. 2
The principal defendants in the said Civil Case No. 0035 are Benjamin (Kokoy) Romualdez, Ferdinand E. Marcos and Imelda R. Marcos.
Petitioner Francisco S. Tantuico, Jr. was included as defendant in Civil Case No. 0035 on the theory that: (1) he acted in unlawful concert with the principal defendants in
the misappropriation and theft of public funds, plunder of the nation's wealth, extortion, blackmail, bribery, embezzlement and other acts of corruption, betrayal of
(2) he acted as dummy, nominee or agent, by allowing himself to be incorporator,
public trust and brazen abuse of power; 3
director, board member and/or stockholder of corporations beneficially held and/or controlled by the principal
defendants; 4 (3) he acted singly or collectively, and/or in unlawful concert with one another, in flagrant breach
of public trust and of their fiduciary obligations as public officers, with gross and scandalous abuse of right and
power and in brazen violation of the Constitution and laws of the Philippines, embarked upon a systematic plan
to accumulate ill-gotten wealth ; 5(4) he (petitioner) taking undue advantage of his position as Chairman of the
Commission on Audit and with grave failure to perform his constitutional duties as such Chairman, acting in
concert with defendants Ferdinand E. Marcos and Imelda R. Marcos, facilitated and made possible the
withdrawals, disbursements and questionable use of government funds; 6 and (5) he acted as dummy, nominee
and/or agent by allowing himself to be used as instrument in accumulating ill-gotten wealth through
government concessions, orders and/or policies prejudicial to plaintiff, or to be incorporator, director, or
member of corporations beneficially held and/or controlled by defendants Ferdinand E. Marcos, Imelda R.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Marcos, Benjamin (Kokoy) Romualdez and Juliette Gomez Romualdez in order to conceal and prevent recovery
of assets illegally obtained. 7
was denied by respondent court in its resolution 9 dated 9
On 11 April 1988, after his motion for production and inspection of documents 8
March 1988, petitioner filed a Motion for a Bill of Particulars, 10 alleging inter alia that he is sued for acts
allegedly committed by him as (a) a public officer-Chairman of the Commission on Audit, (b) as a private
individual, and (c) in both capacities, in a complaint couched in too general terms and shorn of particulars that
would inform him of the factual and legal basis thereof, and that to enable him to understand and know with
certainty the particular acts allegedly committed by him and which he is now charged with culpability, it is
necessary that plaintiff furnish him the particulars sought therein relative to the averments in paragraphs 2,
9(a), 15, 7 and 17 of the Second Amended Complaint so that he can intelligently prepare his responsive pleading
and prepare for trial. The particulars sought for in the said motion are as follows:
a. Relative to the averments in paragraphs 2, 9(a) and l5 of the Second Amended Complaint:
i) What are the dates of the resolutions (if on appeal) or the acts (if otherwise) issued or
performed by herein defendant which allowed the facilitation of, and made possible the,
withdrawals, disbursements and questionable use of government funds;
ii) What ministries or Departments, offices or agencies of the government were involved in
these questionable use of government funds;
iii) What are the names of the auditors who had the original audit jurisdiction over the said
withdrawals, disbursements and questionable use of government funds;
iv) How much government funds were involved in these questionable-disbursements,
individually and in totally?
v) Were the disbursements brought to herein defendant for action on pre-audit, post-audit or
otherwise or where they initiated and/or allowed release by herein defendant alone, without
them undergoing usual governmental audit procedures, or in violation thereof.?
vi) What were herein defendant's other acts or omission or participation in the matter of
allowing such disbursements and questionable use of government funds, if any?
b. Relative to paragraphs 7 and 17 of the Second Amended Complaint:
i) In what particular contract, dealing, transaction and/or relationship of any nature of
Ferdinand E. Marcos, Imelda R. Marcos, Juliette Gomez Romualdez or Benjamin T. Romualdez
did herein defendant act as dummy, nominee or agent? Please specify the dealings, the dates,
the corporations or entities involved, the government offices involved and the private and
public documents, if any, showing herein defendant's complicity, since he is not aware of any
such instance. More basically, please specify whether the defendant is a dummy or nominee
or agent and of which corporation or transaction?
ii) What particular government concession, order and/or policy obtained by Ferdinand E.
Marcos, or Imelda R. Marcos, or Juliette Gomez Romualdez and/or Benjamin T. Romualdez
allowed them either singly or jointly to accumulate ill-gotten wealth by using herein
defendant as instrument for their accomplishment. Likewise please identify the nature of the
transactions, the dates and the document showing complicity on the part of herein defendant;
he is not aware of any such instance.
iii) Please specify the name or denominate the particular government concession, order
and/or policy prejudicial to the interest of the government which was obtained by either of
the above-named four defendants through the participation of herein defendant as a dummy,
nominee or agent of herein defendant. Please likewise identify the government office
involved, the dates and other particulars, likewise defendant is not aware of any such
instance.
iv) Please name and specify the corporation whether stock or non-stock, whether
government or private, beneficially held and/or controlled by either of the four above
defendants, where herein defendant is an incorporator, director or member and where his
inclusion as such incorporator, director or member of the corporation was made in order to
conceal and prevent recovery of assets illegally obtained by the aforementioned four
defendants, how many shares are involved and what are their values, how and when have
they been acquired.
The Solicitor General, for and in behalf of respondents (except the respondent Sandiganbayan),
opposed the motion. 11 After the petitioner had filed his reply 12 thereto, the respondent
Sandiganbayan promulgated on 21 April 1990 a resolution 13 denying the petitioner's motion for a bill
of particulars on the ground that the particulars sought by petitioner are evidentiary in nature, the
pertinent part of which resolution reads, as follows:
We are of the considered opinion that the allegations in the Expanded Complaint are quite
clear and sufficient enough for defendant-movant to know the nature and scope of the causes
of action upon which plaintiff seeks relief. They provide the factual scenario which, coupled
with other allegations set forth in the "Common Averments" and further specified in the
"Specific Averments" of herein defendant-movant and his co-defendants' illegal acts which
are within defendant-movant's peculiar and intimate knowledge as a government official and
corporate executive, will enable him to make the proper admission, denials or qualifications,
set out affirmative and/or special defenses and thereafter prepare for trial. Evidentiary facts
or matters are not essential in the pleading of the cause of action, nor to details or probative
value or particulars of evidence by which these material evidence are to be established
(Remitere vs. Yulu, 6 SCRA 251). The matters which he seeks are evidentiary in nature and,
being within his intimate or personal knowledge, may be denied or admitted by him or if
deemed necessary, be the subject of other forms of discovery. 14
Petitioner moved for reconsideration 15 but this was denied by respondent Sandiganbayan in its resolution 16 dated
29 May 1990.
Hence, petitioner filed the present petition.
The principal issue to be resolved in the case at bar is whether or not the respondent Sandiganbayan
acted with grave abuse of discretion in issuing the disputed resolutions.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Petitioner argues that the allegations of the Second Amended Complaint in Civil Case No. 0035 (PCGG
35) pertaining to him state only conclusions of fact and law, inferences of facts from facts not pleaded
and mere presumptions, not ultimate facts as required by the Rules of Court.
On the other hand, the respondent Sandiganbayan, by and through the Solicitor General, contends that
the essential elements of an action for recovery of ill-gotten wealth are: (1) an accumulation of assets,
properties and other possessions; (2) of former President Ferdinand E. Marcos, Mrs. Imelda
Romualdez Marcos, their close relatives, subordinates, business associates, dummies, agents, or
nominees; and (3) whose value is out of proportion to their known lawful income, and that the ultimate
facts establishing these three (3) essential elements of an action for recovery of ill-gotten wealth are
sufficiently alleged in the complaint. Hence, petitioner is not entitled to a bill of particulars.
A complaint is defined as a concise statement of the ultimate facts constituting the plaintiff's cause or
causes of action. 17 Like all other pleadings allowed by the Rules of Court, 18 the complaint shall contain
in a methodical and logical form a plain, concise and direct statement of the ultimate facts on which the
plaintiff relies for his claim, omitting the statement of mere evidentiary
facts. 19 Its office, purpose or function is to inform the defendant clearly and definitely of the claims
made against him so that he may be prepared to meet the issues at the trial. The complaint should
inform the defendant of all the material facts on which the plaintiff relies to support his demand; it
should state the theory of a cause of action which forms the bases of the plaintiff's claim of liability. 20
The rules on pleading speak of two (2) kinds of facts: the first, the "ultimate facts", and the second, the
"evidentiary facts." In Remitere vs. Vda. de Yulo, 21 the term "ultimate facts" was defined and explained
as follows:
The term "ultimate facts" as used in Sec. 3, Rule 3 of the Rules of Court, means the essential
facts constituting the plaintiffs cause of action. A fact is essential if it cannot be stricken out
without leaving the statement of the cause of action insufficient. . . . (Moran, Rules of Court,
Vol. 1, 1963 ed., p. 213).
Ultimate facts are important and substantial facts which either directly form the basis of the
primary right and duty, or which directly make up the wrongful acts or omissions of the
defendant. The term does not refer to the details of probative matter or particulars of
evidence by which these material elements are to be established. It refers to principal,
determinate, constitutive facts, upon the existence of which, the entire cause of action rests.
while the term "evidentiary fact" has been defined in the following tenor:
Those facts which are necessary for determination of the ultimate facts; they are the premises
upon which conclusions of ultimate facts are based. Womack v. Industrial Comm., 168 Colo.
364,451 P. 2d 761, 764. Facts which furnish evidence of existence of some other fact. 22
Where the complaint states ultimate facts that constitute the three (3) essential elements of a cause of action, namely: (1) the legal right of the plaintiff, (2)
the correlative obligation of the defendant, and (3) the act or omission of the defendant in violation of said legal right, the complaint states a cause of
However, where the
action, otherwise, the complaint must succumb to a motion to dismiss on that ground of failure to state a cause of action. 23
allegations of the complaint are vague, indefinite, or in the form of conclusions, the proper recourse
would be, not a motion to dismiss, but a motion for a bill of particulars. 24 Thus, Section 1, Rule 12 of
the Rules of Court provides:
Before responding to a pleading or, if no responsive pleading is permitted by these rules,
within ten (10) days after service of the pleading upon him, a party may move for a more
definite statement or for a bill of particulars of any matter which is not averred with sufficient
definiteness or particularity to enable him properly to prepare his responsive pleading or to
prepare for trial. Such motion shall point out the defects complained of and the details
desired.
In this connection, the following allegations have been held as mere conclusions of law, inferences from
facts not alleged or opinion of the pleader: (a) the allegations that defendants appellees were "actuated
by ulterior motives, contrary to law and morals, with abuse of their advantageous position as
employers, in gross and evident bad faith and without giving plaintiff . . . his due, wilfully, maliciously,
unlawfully, and in summary and arbitrary manner", are conclusions of law, inferences from facts not
alleged and expressions of opinion unsupported by factual premises; 25 (b) an allegation of duty in
terms unaccompanied by a statement of facts showing the existence of the duty, is a mere conclusion of
law, unless there is a relation set forth from which the law raises the duty; 26 (c) an averment . . . that an
act was "unlawful" or "wrongful" is a mere legal conclusion or opinion of the pleader; 27 (d) the
allegation that there was a violation of trust was plainly a conclusion of law, for "a mere allegation that
it was the duty of a party to do this or that, or that he was guilty of a breach of duty, is a statement of a
conclusion, not of a fact;" 28 (e) an allegation that a contract is valid or void, is a mere conclusion of
law; 29 (f) the averment in the complaint that "defendant usurped the office of Senator of the
Philippines" is a conclusion of law — not a statement of fact — inasmuch as the particular facts on
which the alleged usurpation is predicated are not set forth therein; 30 and (g) the averment that "with
intent of circumventing the constitutional prohibition that 'no officer or employee in the civil service
shall be removed or suspended except for cause as provided by law', respondents maliciously and
illegally for the purpose of political persecution and political vengeance, reverted the fund of the salary
item . . . and furthermore eliminated or abolished the said position effective 1 July 1960" is a mere
conclusion of law unsupported by factual premises. 31
Bearing in mind the foregoing rules on pleading and case law, let us now examine the allegations of the Second Amended Complaint against the petitioner
to determine whether or no they were averred with sufficient definiteness or particularity to enable him properly to prepare his responsive pleading or to
prepare for trial. If the allegations of the said complaint are vague, indefinite or in the form of conclusions, then petitioner is entitled to a bill of particulars.
The allegations in the complaint pertaining to the alleged culpable and unlawful acts of herein petitioner are quoted hereunder as follows:
GENERAL AVERMENTS
OF
DEFENDANTS' ILLEGAL ACTS
9. (a) From the early years of his presidency, Defendant Ferdinand E. Marcos took undue advantage of his powers as President. All
throughout the period from September 21, 1972 to February 25, 1986, he gravely abused his powers under martial law and ruled as Dictator
under the 1973 Marcos-promulgated Constitution. Defendant Ferdinand E. Marcos, together with other Defendants, acting singly or
collectively, and/or in unlawful concert with one another, in flagrant breach of public trust and of their fiduciary obligations as public
officers, with gross and scandalous abuse of right and power and in brazen violation of the Constitution and laws of the Philippines,
embarked upon a systematic plan to accumulate ill-gotten wealth;
(b) Upon his unfettered discretion, and sole authority, for the purpose of implementing the plan referred to above, Defendant Ferdinand E.
Marcos ordered and caused, among others:
(b-i) the massive and unlawful withdrawal of funds, securities, reserves and other assets and property from the National
Treasury, the Central Bank, the other financial institutions and depositories of Plaintiff;
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

(b-ii) the transfer of such funds, securities, reserves and other assets and property to payees or transferees of his choice and 14. Defendants Benjamin (Kokoy) Romualdez and Juliette Gomez Romualdez, acting by themselves and/or in unlawful concert with
whether and in what manner such transactions should be recorded in the books and records of these institutions and other Defendants Ferdinand E. Marcos and Imelda R. Marcos, and taking undue advantage of their relationship, influence and connection with the
depositories of Plaintiff; latter Defendant spouses, engaged in devices, schemes and strategems to unjustly enrich themselves at the expense of Plaintiff and the
Filipino people, among others:

10. Among others, in furtherance of the plan and acting in the manner referred to above, in unlawful concerted with one another and with
gross abuse of power and authority, Defendants Ferdinand E. Marcos and Imelda R. Marcos; (a) obtained, with the active collaboration of Defendants Senen J. Gabaldon, Mario D. Camacho, Mamerto Nepomuceno, Carlos J. Valdes, Delia
Tantuico, Jovencio F. Cinco, Cesar C. Zalamea and Francisco Tantuico, control of some of the biggest business enterprises in the Philippines,
such as, the Manila Electric Company (MERALCO), Benguet Consolidated Mining Corporation (BENGUET) and the Pilipinas Shell
xxx xxx xxx
Corporation, by employing devious financial schemes and techniques calculated to require the massive infusion and hemmorrhage of
government funds with minimum or negligible "cashout" from Defendant Benjamin Romualdez. The following are the general features of a
b. Converted government-owned and controlled corporations into private enterprises and appropriated them and/or their
classic take-over bid by Defendant Benjamin Romualdez:
assets for their own benefit and enrichment;

xxx xxx xxx

c. Awarded contracts with the Government to their relatives, business associates, dummies, nominees, agents or persons who
were beholden to said Defendants, under terms and conditions grossly and manifestly disadvantageous to the Government;
(ii) The shares were held in the name of corporations which were organized soldely (sic) for the purpose of holding title to
them. These corporations did not have any operating history nor any financial track record. Projected cash flow consisted
d. Misappropriated, embezzled and/or converted to their own use funds of Government financial institutions, particularly
almost solely of future and contingent dividends on the shares held. In spite of these limitations, these companies enjoyed
those allocated to the Office of the President and other ministries and agencies of the Government including, those
excellent credit lines from banks and other financial institutions, as evidenced by the millions of pesos in loan and guarantees
conveniently denominated as intelligence or counter-insurgency funds, as well as funds provided to Plaintiff by foreign
outstanding in their books;
countries, multinationals, public and private financial institutions;

(iii) The "seed money" used to wrest control came from government and taxpayers' money in the form of millions of pesos in
e. Raided Government financial and banking institutions of billions of pesos in loans, guarantees and other types of financial
loans, guarantees and standby L/C's from government financial institutions, notably the DBP and PNB, which were in turn
accommodations to finance dubious and/or overpriced projects of favored corporations or individuals and misused and/or
rediscounted with the Central Bank;
converted to their own use and benefit deposits found therein to the financial ruin of Plaintiff and the Filipino people;

(iv) Additional funding was provided from the related interests; and
xxx xxx xxx

(v) This intricate (sic) skein of inter-corporate dealings was controlled and administered by an exclusive and closely knit
h. Sold, conveyed and/or transferred Government property, real and/or personal, to corporations beneficially held and/ or
group of interlocking directorate and officership
controlled by them or through third persons, under such terms and conditions grossly and manifestly disadvantageous to the
Government;
xxx xxx xxx

i. Engaged in other illegal and improper acts and practices designed to defraud Plaintiff and the Filipino people, or otherwise
(g) Secured, in a veiled attempt to justify MERALCO's anomalous acquisition of the electric cooperatives, with the active collaborations of
misappropriated and converted to their own use, benefit and enrichment the lawful patrimony and revenues of Plaintiff and
Defendants Cesar E. A. Virata, Juanita R. Remulla, Isidro Rodriguez, Jose C. Hernandez, Pedro Dumol, Ricardo C. Galing, Francisco C.
the Filipino people.
Gatmaitan, Mario D. Camacho and the rest of the Defendants, the approval by Defendant Ferdinand E. Marcos and his cabinet of the so-called
"Three-Year Program for the Extension of MERALCO's Services to Areas Within The 60-kilometer Radius of Manila", which required
11. Among the assets acquired by Defendants in the manner above-described and discovered by the Commission in the exercise of its official
government capital investment amounting to millions of pesos;
responsibilities are funds and other property listed in Annex "A" hereof and made an integral part of this Complaint.

xxx xxx xxx

12. Defendants, acting singly or collectively, and/or in unlawful concert with one another, for the purpose of preventing disclosure and
avoiding discovery of their unmitigated plunder of the National Treasury and of their other illegal acts, and employing the services of
(1) Caused the National Investment and Development Corporation (NIDC) to dispose of its interest in the oil plants located in Tanauan,
prominent lawyers, accountants, financial experts, businessmen and other persons, deposited, kept and invested funds, securities and other
Leyte, which were owned and operated by its subsidiary, the NIDC Oil Mills, Inc., in favor of the SOLO II, Inc., a corporation beneficially held
assets estimated at billions of US dollars in various banks, financial institutions, trust or investment companies and with persons here and
and controlled by Defendant Benjamin Romualdez, with the active collaboration of Defendants Jose Sandejas, Francisco Tantuicoand
abroad.
Dominador G. Ingco, under terms and conditions grossly disadvantageous to NIDC, to the grave and irreparable damage of Plaintiff and the
V
Filipino people.
SPECIFIC AVERMENTS
OF
DEFENDANTS' ILLEGAL ACTS (2) Defendant Francisco Tantuico, taking undue advantage of his position as Chairman of the Commission on Audit and with grave failure to
xxx xxx xxx perform his constitutional duties as such Chairman, acting in concert with Defendants Ferdinand E. Marcos and Imelda R. Marcos, facilitated
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
and made possible the withdrawals, disbursements and questionable use of government funds as stated in the foregoing paragraphs to the
grave and irreparable damage and injury of Plaintiff and the entire Filipino people.
xxx xxx xxx
17. The following Defendants acted as dummies, nominees and/ or agents by allowing themselves (i) to be used as instruments in
accumulating ill-gotten wealth through government concessions, orders and/or policies prejudicial to Plaintiff, or (ii) to be incorporators,
directors, or members of corporations held and/or controlled by Defendants Ferdinand E. Marcos, Imelda R. Marcos, Benjamin (Kokoy)
Romualdez, and Juliette Gomez Romualdez in order conceal (sic) and prevent recovery of assets illegally obtained: Francisco Tantuico . . .
17.a. THE NAMES OF SOME OF THE CORPORATIONS BENEFICALLY HELD AND/OR CONTROLLED BY THE DEFENDANTS BENJAMIN
(KOKOY) ROMUALDEZ, FERDINAND E. MARCOS AND IMELDA R. MARCOS WHERE THE POSITIONS/PARTICIPATIONS AND/OR
INVOLVEMENTS OF SOME OF THE DEFENDANTS AS DUMMIES, NOMINEES AND/OR AGENTS ARE INDICATED ARE LISTED IN ANNEX "B"
HEREOF AND MADE AN INTEGRAL PART OF THIS COMPLAINT.
xxx xxx xxx
18. The acts of Defendants, singly or collectively, and/or in unlawful concert with one another, constitute gross abuse of official position and
authority, flagrant breach of public trust and fiduciary obligations, acquisition of unexplained wealth, brazen abuse of official position and
authority, flagrant breach of public trust and fiduciary obligations, acquisition of unexplained wealth, brazen abuse of right and power,
unjust enrichment, violation of the Constitution and laws of the Republic of the Philippines, to the grave and irreparable damage of Plaintiff
and the Filipino people. (Emphasis supplied)
Let us now analyze and discuss the allegations of the complaint in relation to which the petitioner pleads for a bill of particulars.
As quoted above, paragraph 9(a) of the complaint alleges that "Defendant Ferdinand E. Marcos, together with other Defendants, acting singly or
collectively, and/or in unlawful concert with one another, in flagrant breach of public trust and of their fiduciary obligations as public officers, with gross
and scandalous abuse of right and power and in brazen violation of the Constitution and laws of the Philippines, embarked upon a systematic plan to
accumulate ill-gotten wealth." In the light of the rules on pleading and case law cited above, the allegations that defendant Ferdinand E. Marcos, together
with the other defendants "embarked upon a systematic plan to accumulate ill-gotten wealth" and that said defendants acted "in flagrant breach of public
trust and of their fiduciary obligations as public officers, with gross and scandalous abuse of right and in brazen violation of the Constitution and laws of
the Philippines", are conclusions of law unsupported by factual premises.
Nothing is said in the complaint about the petitioner's acts in execution of the alleged "systematic plan to accumulate ill-gotten wealth", or which are
supposed to constitute "flagrant breach of public trust", "gross and scandalous abuse of right and power", and "violations of the Constitution and laws of
the Philippines". The complaint does not even allege what duties the petitioner failed to perform, or the particular rights he abused.
Likewise, paragraph 15 avers that "defendant Francisco Tantuico, taking undue advantage of his position as Chairman of the Commission on Audit and
with grave failure to perform his constitutional duties as such Chairman, acting in concert with Defendants Ferdinand E. Marcos and Imelda R. Marcos
facilitated and made possible the withdrawals, disbursements and questionable use of government funds as stated in the foregoing paragraphs to the
grave and irreparable damage and injury of Plaintiff and the entire Filipino people." In like manner, the allegation that petitioner "took undue advantage of
his position as Chairman of the Commission on Audit," that he "failed to perform his constitutional duties as such Chairman," and acting in concert with
Ferdinand E. Marcos and Imelda R. Marcos, "facilitated and made possible the withdrawals, disbursements, and questionable use of government funds as
stated in the foregoing paragraphs, to the grave and irreparable damage and injury of plaintiff and the entire Filipino people", are mere conclusions of law.
Nowhere in the complaint is there any allegation as to how such duty came about, or what petitioner's duties were, with respect to the alleged withdrawals
and disbursements or how petitioner facilitated the alleged withdrawals, disbursements, or conversion of public funds and properties, nor an allegation
from where the withdrawals and disbursements came from, except for a general allegation that they came from the national treasury. On top of that, the
complaint does not even contain any factual allegation which would show that whatever withdrawals, disbursements, or conversions were made, were
indeed subject to audit by the COA.
In this connection, it may well be stated that the Commission on Audit (COA) is an independent, constitutional commission, which has no power or
authority to withdraw, disburse, or use funds and property pertaining to other government offices or agencies. This is done by the agency or office itself,
The COA is
the chief or head of which is primarily and directly responsible for the funds and property pertaining to such office or agency. 32
merely authorized to audit, examine and settle accounts of the various government offices or agencies,
and this task is performed not by the Chairman of the COA but by the COA auditors assigned to the
government office or agency subject to COA audit.
Thus, in each agency of the government, there is an auditing unit headed by an auditor, whose duty is
to audit and settle the accounts, funds, financial transactions, and resources of the agency under his
audit jurisdiction.33 The decision of the auditor is appealable to the Regional Director, 34 whose
decision, is in turn, appealable to the COA Manager. 35 Any party dissatisfied with the decision of the
COA Manager may bring the matter on appeal to the Commission proper, a collegiate body exercising
quasi-judicial functions, composed of three (3) COA Commissioners, with the COA Chairman as
presiding officer. 36 It is only at this stage that the COA Chairman would come to know of the matter
and be called upon to act on the same, and only if an aggrieved party brings the matter on appeal.
In other words, the Chairman of the COA does not participate or personally audit all disbursements and
withdrawals of government funds, as well as transactions involving government property. The
averments in the particular paragraph of the complaint merely assume that petitioner participated in
or personally audited all disbursements and withdrawals of government funds, and all transactions
involving government property. Hence, the alleged withdrawals, disbursements and questionable use
of government funds could not have been, as held by respondent Sandiganbayan, "within the peculiar
and intimate knowledge of petitioner as Chairman of the COA."
The complaint further avers in paragraph 17 that "(t)he following Defendants acted as dummies,
nominees and/or agents by allowing themselves (i) to be instruments in accumulating ill-gotten wealth
through government concessions, order and/or policies prejudicial to Plaintiff, or (ii) to be
incorporators, directors, or members of corporations beneficially held and/or controlled by Defendant
Ferdinand E. Marcos, Imelda R. Marcos, Benjamin (Kokoy) T. Romualdez and Juliette Gomez
Romualdez in order to conceal and prevent recovery of assets illegally obtained: Francisco Tantuico . .
." 37 Again, the allegation that petitioner acted as dummy, nominee, or agent by allowing himself "to be
used as instrument in accumulating ill-gotten wealth through government concessions, orders and/or
policies prejudicial to Plaintiff" or "to be (an) incorporator, director, or member of corporations
beneficially held and/or controlled" by the Marcoses and Romualdezes, is a conclusion of law without
factual basis.
The complaint does not contain any allegation as to how petitioner became, or why he is perceived to
be, a dummy, nominee or agent. Besides, there is no averment in the complaint how petitioner allowed
himself to be used as instrument in the accumulation of ill-gotten wealth, what the concessions, orders
and/or policies prejudicial to plaintiff are, why they are prejudicial, and what petitioner had to do with
the granting, issuance, and or formulation of such concessions, orders, and/or policies. Moreover,
Annex "A" of the complaint lists down sixty-one (61) corporations which are supposed to be
beneficially owned or controlled by the Marcoses and Romualdezes. However, the complaint does not
state which corporations petitioner is supposed to be a stockholder, director, member, dummy,
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
nominee and/or agent. More significantly, the petitioner's name does not even appear in Annex "B" of
the complaint, which is a listing of the alleged "Positions and Participations of Some Defendants".
The allegations in the complaint, above-referred to, pertaining to petitioner are, therefore, deficient in
that they merely articulate conclusions of law and presumptions unsupported by factual premises.
Hence, without the particulars prayed for in petitioner's motion for a bill of particulars, it can be said
the petitioner can not intelligently prepare his responsive pleading and for trial.
Furthermore, the particulars prayed for, such as, names of persons, names of corporations, dates,
amounts involved, specification of property for identification purposes, the particular transactions
involving withdrawals and disbursements, and a statement of other material facts as would support
the conclusions and inferences in the complaint, are not evidentiary in nature. On the contrary, those
particulars are material facts that should be clearly and definitely averred in the complaint in order
that the defendant may, in fairness, be informed of the claims made against him to the end that he may
be prepared to meet the issues at the trial.
Thus, it has been held that the purpose or object of a bill of particulars is —
. . . to amplify or limit a pleading, specify more minutely and particularly a claim or defense
set up and pleaded in general terms, give information, not contained in the pleading, to the
opposite party and the court as to the precise nature, character, scope, and extent of the cause
of action or defense relied on by the pleader, and apprise the opposite party of the case which
he has to meet, to the end that the proof at the trial may be limited to the matters specified,
and in order that surprise at, and needless preparation for, the trial may be avoided, and that
the opposite party may be aided in framing his answering pleading and preparing for trial. It
has also been stated that it is the function or purpose of a bill of particulars to define, clarify,
particularize, and limit or circumscribe the issues in the case, to expedite the trial, and assist
the court. A general function or purpose of a bill of particulars is to prevent injustice or do
justice in the case when that cannot be accomplished without the aid of such a bill. 38
Anent the contention of the Solicitor General that the petitioner is not entitled to a bill of particulars because the ultimate facts constituting the three (3)
essential elements of a cause of action for recovery of ill-gotten wealth have been sufficiently alleged in the complaint, it would suffice to state that in a
motion for a bill of particulars, the only question to be resolved is whether or not the allegations of the complaint are averred with sufficient definiteness
or particularity to enable the movant properly to prepare his responsive pleading and to prepare for trial. As already discussed, the allegations of the
complaint pertaining to the herein petitioner are deficient because the averments therein are mere conclusions of law or presumptions, unsupported by
factual premises.
In the light of the foregoing, the respondent Sandiganbayan acted with grave abuse of discretion amounting to lack or excess of jurisdiction in
promulgating the questioned resolutions.
WHEREFORE, the petition is GRANTED and the resolutions dated 21 April 1989 and 29 May 1989 are hereby ANNULLED and SET ASIDE. The respondents
are hereby ordered to PREPARE and FILE a Bill of Particulars containing the facts prayed for by petitioner within TWENTY (20) DAYS from notice, and
should they fail to submit the said Bill of Particulars, respondent Sandiganbayan is ordered TO EXCLUDE the herein petitioner as defendant in Civil Case
No. 0035.
SO ORDERED.
6. PHILIPPINE NATIONAL BANK, petitioner, vs. COURT OF APPEALS and CARMELO H.
FLORES, respondents. [G.R. No. 116181. April 17, 1996]
SYLLABUS
1. REMEDIAL LAW; EVIDENCE; DOCUMENTARY EVIDENCE; RECEIPT; ADMISSIBILITY. A receipt is defined
as: A written and signed acknowledgment that money has been paid or goods have been delivered. A
receipt is merely presumptive evidence and is not conclusive. A written acknowledgment that money or a
thing of value has been received. Since a receipt is a mere acknowledgement of payment, it may be subject to
explanation or contradiction. A receipt may be used as evidence against one just as any other declaration or
admission. A simple receipt not under seal is presumptive evidence only and may be rebutted or explained
by other evidence of mistake in giving it, or of non-payment or of the circumstances under which it was
given.
2. ID.; ID.; ID.; ID.; AFFORDS THE BEST PROOF OF PAYMENT. - Although a receipt is not conclusive evidence,
in the case at bench, an exhaustive review of the records fails to disclose any other evidence sufficient and
strong enough to overturn the acknowledgment embodied in petitioners own receipt (as to the amount of
money it actually received). Petitioner contends that it offered in court evidence of the particulars or the
actual denominations of the money it received from Flores in exchange for its managerial checks. However,
aside from the self-serving testimonies of petitioners witnesses, we fail to discover any such evidence in
the records. In the words of the trial court: After having thoroughly evaluated the evidences (sic) on
record, the Court finds and so believes that plaintiff indeed paid defendant the amount of P 1,000,040.00
when he purchased the two (2) managers checks worth (sic) P 1,000,000.00. This is clearly manifested
from the receipt issued by the defendant wherein it explicitly admits that the amount stated therein is
what plaintiff actually paid. While the defendant does not dispute the receipt it issued to the plaintiff, it
endeavored to prove that the actual amount involved in the entire transaction is only P900,000.00 that is
P450,000.00 managers check and P450,000.00 cash by submitting in evidence, the application forms filled up
by the plaintiff, Exhibits 1, 2, 3 and 4. As may be readily seen these application forms relied upon by the
defendant have no probative value for they do not yield any direct proof of payment. Besides defendant even
failed to adduce concrete evidence showing that these forms which were crumpled and retrieved from the
waste basket were made the basis of the approval of the purchased (sic) made. At any rate, the Court finds
such pieces of evidence not only unconvincing but also self-defeating in the light of the receipt, the
accuracy, correctness and due execution of which was indubitably established. It is a cardinal rule in the
law on evidence that the best proof of payment is the receipt.
3. CIVIL LAW; DAMAGES; NEGLIGENCE; ISSUANCE THEREOF CREATES A FIDUCIARY RELATIONSHIP
BETWEEN THE BANK AND THE PURCHASER OF THE CHECK AND THEREFORE ANY BREACH
THEREOF MUST BE BORNE BY THE NEGLIGENT PARTY. -Since there is no doubt as to the fact that the
plaintiff purchased from the defendant bank two (2) managers check worth P500,000.00 each as this was
evidenced by an official receipt, then, following the above jurisprudential ruling, the existence of the
managers check (sic) created as (sic) fiduciary relationship between the defendant bank and the plaintiff
and therefore any breach thereof must be borne by the negligent party. In this case, the money counter
who, among her other duties, is in charge of counting the money received from a client purchasing a
managers check did not perform her duty with diligence and due care. This may be gathered from her
testimony that she did not wait for the counting machine to finish counting the money for the plaintiff is a
VIP client and he was in a hurry as he was tapping the window. Equally negligent is Reynaldo Castor for
not doing anything when he noticed that their money counters who entertained the plaintiff were rattled.
From these unfolded facts, the so-called honest mistake pleaded is therefore misplaced and perforced,
defendant must suffer the consequences of its own negligent acts.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
4. ID.; ID.; MORAL DAMAGES; GRANTED WHERE THE PLAINTIFFS INTEGRITY AS A BUSINESSMAN WAS
TARNISHED DUE TO DEFENDANTS BAD FAITH. - Appellee Flores narrated his woes to the lower court
when appellant bank refused to honor his Managers Checks worth P1 Million because of the alleged
shortage in appellees payment to the effect that he had to go back and forth the bank to encash said checks,
and that he lost a deal of (sic) a house for sale in Baguio City worth P1 Million as he could not produce said
amount withheld by the appellant bank. Appellee Flores further testified as to the effect of the incident on
his integrity as a businessman. In the case of Makabali v. C. A., 157 SCRA 253, the Supreme Court reiterated
the doctrine on the grant of moral and exemplary damages, as follows: To begin with, there is no hard and
fast rule in the determination of what would be a fair amount of moral damages, since each case must be
governed by its own peculiar circumstances. Article 2217 of the Civil Code recognizes that moral damages
which include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation and similar injury, are incapable of pecuniary estimation.
5. ID.; ID.; ID.; MUST BE COMMENSURATE WITH THE LOSS OR INJURY SUFFERED. - Second, the award of
moral damages in the amount of P1,000,000.00 is obviously not proportionate to the actual losses of P
100,000.00 sustained by Flores. In RCPI v. Rodriguez, (182 SCRA 899 [1990) we ruled thus: x x x.
Nevertheless, we find the award of P 100,000.00 as moral damages in favor of respondent Rodriguez
excessive and unconscionable. In the case of Prudenciado v. Alliance Transport System, Inc. (148 SCRA 440
[1987]) we said: x x x [I]t is undisputed that the trial courts are given discretion to determine the amount
of moral damages (Alcantara v. Surro, 93 Phil. 472) and that the Court of Appeals can only modify or
change the amount awarded when they are palpably and scandalously excessive so as to indicate that it
was the result of passion, prejudice or corruption on the part of the trial court (Gellada v. Warner Barnes &
Co., Inc., 57 O.G. [4] 7347, 7358; and other cases cited). But in more recent cases where the awards of moral
and exemplary damages are far too excessive compared to the actual losses sustained by the aggrieved party,
this Court ruled that they should be reduced to more reasonable amounts. x x x. In other words, the moral
damages awarded must be commensurate with the loss or injury suffered.
6. ID.; ID.; EXEMPLARY DAMAGES; GRANTED ONLY IF THE PLAINTIFF CAN PROVE THAT HE IS ENTITLED
TO MORAL, TEMPERATE OR COMPENSATORY DAMAGES. - As to exemplary damages, Article 2229 of
the Civil Code provides that such damages may be imposed by way of example or correction for the public
good; While exemplary damages cannot be recovered as a matter of right, they need not be proved,
although plaintiff must show that he is entitled to moral, temperate or compensatory damages before the
court may consider the question of whether or not exemplary damages should be awarded.
7. ID.; ID.; ATTORNEYS FEES; GRANTED IF PLAINTIFF IS COMPELLED TO LITIGATE DUE TO DEFENDANTS
NON-COMPLIANCE WITH HIS OBLIGATION. - We see no reason to disturb the award of attorneys fees in
the amount of P50,000.00. We concur with the findings of the Court of Appeals on this matter: As for the
award of attorneys fees, We find the same in order considering that defendant acted in gross and evident
bad faith in refusing to satisfy the plaintiffs plainly valid, just and demandable claim (Art. 2208 [5], New
Civil Code), and it is just and equitable to award plaintiff-appellee his attorneys fees (Art. 2208
[11], id.). Since plaintiff was compelled to litigate to protect its interest due to the non-compliance of
defendants obligation, he is therefore entitled to attorneys. fees (pars. 5, Article 2208, Civil Code of
the Philippines).
APPEARANCES OF COUNSEL
The Chief Legal Counsel for petitioner.
Law Firm of Raymundo A. Armovit for private respondent.
DECISION
KAPUNAN, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court assailing the
decision and resolution of the respondent Court of Appeals in CA-G.R. CV No. 38281 dated 31 January
1994 and 5 July 1994, respectively, which affirmed the decision of the Regional Trial Court in Civil Case No. Q-
89-4033 declaring Philippine National Bank liable to Carmelo H. Flores for damages.
The facts of the case are as follows:
On 11 July 1989, private respondent Carmelo H. Flores (Flores) purchased from petitioner at its Manila
Pavilion Hotel unit, two (2) managers checks worth P500,000.00 each, paying a total of P1,000,040.00, including
the service charge.1 A receipt for said amount was issued by the petitioner.2
On 12 July 1989, Flores presented these checks at the Baguio Hyatt Casino unit of petitioner. Petitioner
refused to encash the checks but after a lengthy discussion, it agreed to encash one (1) of the checks. 3 However,
it deferred the payment of the other check until after Floresagreed that it be broken down to five (5) managers
checks of P 100,000.00 each. Furthermore, petitioner refused to encash one of the five checks until after it is
cleared by the Manila Pavilion Hotel unit.4 Having no other option, Flores agreed to such an arrangement.
However, upon his return to Manila, he made representations to petitioner through its Malate Branch so that the
check may be encashed but to no avail.5 Flores, thereafter, wrote a letter to his counsel informing the latter of
the aforementioned events.6 A Formal Demand was made by private respondents counsel but petitioner
persisted in its refusal to honor the check.7
Left with no other choice, Flores filed a case with the Regional Trial Court of Quezon City, Branch 100,
docketed as Civil Case No. Q-89-4033.8
In its Answer with Compulsory Counterclaim, petitioner insisted that only P900,000.00 and P40.00 bank
charges were actually paid by Flores when he purchased the two (2) managers checks worth P1,000,000.00. It
alleged that due to Flores demanding attitude and temper, petitioners money counter, Rowena Montes, who, at
that time was still new at her job, made an error in good faith in issuing the receipt for P1,000,040.00. 9 The
actuations of Flores allegedly distracted the personnel manning the unit.10
After trial, the court rendered its decision on 5 May 1992, the dispositive portion of which states:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the
defendant Philippine National Bank as follows:
a.) ordering the defendant to pay plaintiff the sum of P 100,000.00 representing the amount of the check
dishonored with interest thereon at the legal rate per annum from November 16, 1989 until fully paid;
b.) ordering defendant to pay plaintiff for the embarrassment caused him the amount of P1,000,000.00 as moral
damages;
c.) ordering defendant to pay plaintiff the amount of P1,000,000.00 as exemplary damages brought about by the
malevolent and malicious acts of the former;
d.) ordering defendant to pay plaintiff the sum of P50,000.00 as attorneys fees; and
e.) ordering defendant to pay the costs of the suit.
SO ORDERED.11
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Petitioner interposed an appeal with the respondent court, docketed as CA-G.R. CV No. 38281 assigning the
following errors, to wit:
I immediately counters that said receipt is not the best evidence to prove how much money Flores actually paid
THE TRIAL COURT ERRED IN HOLDING ON THE BASIS OF THE RECEIPT MARKED EXH. A THAT IN
PURCHASING THE TWO MANAGERS CHECKS ON JULY 11, 1989, APPELLEE FLORES PAID PNB P1,000,040.00
DESPITE (1) THAT THE SAID RECEIPT DOES NOT SHOW, OR AFFORD THE BEST PROOF OF THE CORRECT
AMOUNT PAID BY FLORES TO PNB AND (2) THAT AS SHOWN BY PREPONDERANT AND CONCLUSIVE
EVIDENCE, APPELLEE PAID PNB P900,040 ONLY IN ONE MANAGERS CHECK AND MONETARY BILLS.
II
THE TRIAL COURT ERRED IN AWARDING FLORES P1 MILLION MORAL DAMAGES, P1 MILLION EXEMPLARY
DAMAGES, AND P500,000 (sic) ATTORNEYS FEES DESPITE (1) THAT PNBS REFUSAL TO ENCASH THE
P100,000 MANAGERS CHECK (EXH. B) WAS JUSTIFIED, AS FLORES WAS NEVER ENTITLED TO THE MONEY; (2)
THAT THERE IS ABJECT ABSENCE OF EVIDENCE THAT PNB ACTED FRAUDULENTLY OR MALICIOUSLY, EVEN
AS GOOD FAITH IS PRESUMED; AND (3) THAT FLORES ALLEGED EMBARRASSMENT FOR HIS FAILURE TO
PURCHASE A HOUSE AND LOT DUE TO PNBS REFUSAL TO ENCASH THE WHOLE P1 MILLION IS UNFOUNDED.12
On 31 January 1994, the Court of Appeals rendered the questioned decision, the dispositive portion of
which reads:
WHEREFORE, the appealed decision of the lower court in Civil Case No. Q-89-4033 is hereby AFFIRMED by the
Court.
Costs against defendant-appellant.
SO ORDERED.13
A motion for reconsideration was filed but it was likewise denied in a resolution dated 5 July 1994,14 thus,
the present action with petitioner raising the following issues, to wit:
I
WHETHER OR NOT THE CA ERRED IN LAW IN HOLDING THAT, THE BEST EVIDENCE TO SHOW WHETHER MR.
FLORES PAID THE PNB CASINO UNIT P900,040 OR P1,000,040 IN PURCHASING THE TWO MANAGERS CHECKS
EACH WORTH P500,000 IS THE RECEIPT FOR P1,000,040.
II
WHETHER OR NOT PNB CAN PRESENT COMPETENT AND RELEVANT EVIDENCE TO SUPPORT ITS
ALLEGATION IN THE ANSWER THAT MR. FLORES ACTUALLY PAID P900,040 AND NOT P1,000,040 FOR THE
SUBJECT MANAGERS CHECKS.
III
WHETHER OR NOT THE AWARD FOR P1 MILLION MORAL DAMAGES, P1 MILLION EXEMPLARY DAMAGES, AND
P50,000 ATTORNEYS FEES, AS COMPARED TO THE ACTUAL CLAIM OF P100,000 IS DISPROPORTIONATE AND
UNCONSCIONABLE.15
We shall deal with the first and second issues raised by petitioner together as they are interrelated.
Petitioner concedes that it issued the subject receipt for P1,000,040.00 to Flores; yet, in the same breath, it
for the purchase of petitioners managers checks.
Further, petitioner insists that the issue in the instant case is not the contents of the subject receipt but the
exact amount of money Flores paid to PNB, an inquiry which, petitioner avers, allows the presentation of
evidence aliunde.
Petitioners contentions are unmeritorious.
A receipt is defined as:
A written and signed acknowledgment that money has been paid or goods have been delivered. A receipt is
merely presumptive evidence and is not conclusive.
A written acknowledgment that money or a thing of value has been received. Since a receipt is a mere
acknowledgment of payment, it may be subject to explanation or contradiction. A receipt may be used as evidence
against one just as any other declaration or admission. A simple receipt not under seal is presumptive evidence
only and may be rebutted or explained by other evidence of mistake in giving it, or of non-payment or of the
circumstances under which it was given.16 (Italics ours.)
Although a receipt is not conclusive evidence, in the case at bench, an exhaustive review of the records fails
to disclose any other evidence sufficient and strong enough to overturn the acknowledgment embodied in
petitioners own receipt (as to the amount of money it actually received).
Petitioner contends that it offered in court evidence of the particulars or the actual denominations of the
money it received from Flores in exchange for its managerial checks. However, aside from the self-serving
testimonies of petitioners witnesses, we fail to discover any such evidence in the records. In the words of the
trial court:
After having thoroughly evaluated the evidences (sic) on record, the Court finds and so believes that plaintiff
indeed
paid defendant the amount of P1,000,040.00 when he purchased the two (2) managers checks worth (sic)
P1,000,000.00. This is clearly manifested from the receipt issued by the defendant wherein it explicitly admits
that the amount stated therein is what plaintiff actually paid. While the defendant does not dispute the receipt it
issued to the plaintiff it endeavored to prove that the actual amount involved in the entire transaction is only
P900,000.00 that is P450,000.00 managers check and P450,000.00 cash by submitting in evidence, the application
forms filled up by the plaintiff Exhibits 1, 2, 3 and 4. As may be readily seen these application forms relied upon by
the defendant have no probative value for they do not yield any direct proof of payment. Besides defendant even
failed to adduce concrete evidence showing that these forms which were crumpled and retrieved from the waste
basket were made the basis of the approval of the purchased (sic) made. At any rate, the Court finds such pieces
of evidence not only unconvincing but also self-defeating in the light of the receipt, the accuracy, correctness and
due execution of which was indubitably established. It is a cardinal rule in the law on evidence that the best
proof of payment is the receipt.17 (Italics ours.)
In Monfort v. Aguinaldo,18 the receipts of payment, although not exclusive, were deemed to be the best
evidence. Thus:
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
That the best evidence for proving payment is by the evidence of receipts showing the same is also admitted.
What respondents claim is that there is no rule which provides that payment can only be proved by receipts.
While receipts are deemed to be the best evidence, they are not exclusive. Other evidence may be presented in
lieu thereof if they are not available, as in case of loss, destruction or disappearance. The fact of payment may be
established not only by documentary evidence, but also by parol evidence (48 C.J. 727; Greenleaf, Law of
Evidence, Vol. II, p. 486; Jones on Evidence [1913] Vol. II, p. 193), specially in civil cases where preponderance of
evidence is the rule. Here respondents presented documentary as well as oral evidence which the Court of
Appeals found to be sufficient, and this finding is final.
In the instant case, petitioners contention that Flores paid P900,000.00 only instead of P1,000,000.00 (exclusive
of bank charges) in the following denominations: a managers check worth P450,000.00; P430,000.00 in P100.00
bills; and P20,000.00 in P500.00 bills, was based solely on the testimonies of petitioners bank employees - the
very ones involved in the fiasco,19 and not on any other independent evidence. Hence, having failed to adduce
sufficient rebuttal evidence, petitioner is bound by the contents of the receipt it issued to Flores. The subject
receipt remains to be the primary or best evidence or that which affords the greatest certainty of the fact in
question.20
On the issue of damages, we concur with the findings of the trial court and the Court of Appeals,
respectively:
Since there is no doubt as to the fact that the plaintiff purchased from the defendant bank two (2) managers
check worth P500,000.00 each as this was evidenced by an official receipt (Exhibit A), then, following the above
jurisprudential ruling, the existence of the managers check (sic) created as (sic) fiduciary relationship between
the defendant bank and the plaintiff and therefore any breach thereof must be borne by the negligent party. In
this case, the money counter who, among her other duties, is in charge of counting the money received from a
client purchasing a managers check did not perform her duty with diligence and due care. This may be gathered
from her testimony that she did not wait for the counting machine to finish counting the money for the plaintiff
is a VIP client and he was in a hurry as he was tapping the window (p. 37, T.S.N., August 28, 1990). Equally
negligent is Reynaldo Castor for not doing anything when he noticed that their money counters who entertained
the plaintiff were rattled. From these unfolded facts, the so-called honest mistake pleaded is therefore misplaced
and perforced, defendant must suffer the consequences of its own negligent acts.
The records further show that plaintiff is a prominent businessman, licensed and engaged in the real estate
business, buying and selling houses and lots under the business name and style CMS Commercial. He is at the
same time a consultant of Dizon-Esguerra Real Estate Company. Defendant treated him as a valued and VIP
client. Because of the banks refusal to encash the entire one million face amount of his managers checks, he was
so embarrassed for he was not able to purchase a house and lot in Monterroza Subdivision, Baguio City.
Significantly, the foregoing undisputed facts made even more untenable defendants implicit supposition that the
subject managers checks were not intended for the purchase of a house or for any business transaction but for
gambling.
Finally, since plaintiff was compelled to litigate to protect its interest due to the non-compliance of defendants
obligation, he is therefore entitled to attorneys fees (pars. 5, Article 2208, Civil Code of the Philippines).21
xxx xxx xxx.
Appellee Flores narrated his woes to the lower court when appellant bank refused to honor his Managers
Checks worth P1 Million because of the alleged shortage in appellees payment to the effect that he had to go
back and forth the bank to encash said checks (pp. 16-18, t.s.n., July 2, 1990), and that he lost a deal of (sic) a
house for sale in Baguio City worth P1 Million as he could not produce said amount withheld by the appellant
bank (p. 22, id.). Appellee Flores further testified as to the effect of the incident on his integrity as a businessman
as follows:
Yes, my integrity and dependability as a businessman is highly doubted in Baguio because of the PNB refusal to
honor the two (2) managers checks inspite of them issuing me the receipt. So, whenever I make a deal in house
and they would now even doubt whether I have the money to buy the house that I am buying, it greatly affected
my integrity as a businessman in Baguio. (p. 25, t.s.n., Id.)
In the case of Makabali v. C. A., 157 SCRA 253, the Supreme Court reiterated the doctrine on the grant of
moral and exemplary damages, as follows:
To begin with, there is no hard and fast rule in the determination of what would be a fair amount of moral
damages, since each case must be governed by its own peculiar circumstances.
Article 2217 of the Civil Code recognizes that moral damages which include physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation and similar
injury, are incapable of pecuniary estimation.
As to exemplary damages, Article 2229 of the Civil Code provides that such damages may be imposed by way of
example or correction for the public good. While exemplary damages cannot be recovered as a matter of right,
they need not be proved, although plaintiff must show that he is entitled to moral, temperate or compensatory
damages before the court may consider the question of whether or not exemplary damages should be
awarded.22
However, we give consideration to petitioners allegation that the award of P1,000,000.00 moral damages and
P1,000,000.00 exemplary damages in addition to Flores actual claim of P100,000.00 is inordinately
disproportionate and unconscionable.23
Under the circumstances obtaining in the case at bench, we rule that the award of moral and exemplary
damages is patently excessive and should be reduced to a reasonable amount.
We take into consideration the following factors:
First, Flores contention that he lost the opportunity to purchase a house and lot in Baguio City due to
petitioners gross negligence is based solely on his own testimony and a mere general statement at that. The
broker he named during his cross-examination on 10 July 1990, a Mr. Nick Buendia was not even presented to
confirm the aforementioned allegation:
xxx xxx xxx
Q. You also stated that this amount was intended for the purchase of the real estate property
in Baguio, is that right?
A. Yes.
Q. Can you tell this Honorable Court where is this specific property located in Baguio?
A. It is located in Monterosa Subdivision.
Q. Can you tell us the number of the street?
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
A. It is within the Monterosa.
Q. Can you identify the name of the person with whom you transacted?
A. Your Honor, I have the papers and during the next hearing I will bring it.
ATTY. D. VALDEZ:
Is that mean, Your Honor that we are continuing the cross examination on the next hearing
considering that he will show a certain document.
Q. Can you not reveal to us the name of the person with whom you transacted?
A. As I have said I could not be guessing because it was coursed through another broker.
And, this broker usually did not tell you who is the owner.
Q. What I am asking you is the person whom you transacted and not necessarily the owner? We are
supposed to know, Your Honor.
COURT:
The name of the broker.
A. The name of the broker, Your Honor is Nick Buendia.
Q. Do you know what subsequently happened if there was anything happened to that property that
was being sold?
A. It was sold.
Q. To someone else?
A. Yes.
Q. At the time you were purchasing the managers checks for one (1 M) million you intended this as a
payment for the property?
A. Yes.24
xxx xxx xxx.
Second, the award of moral damages in the amount of P 1,000,000.00 is obviously not proportionate to the
actual losses of P100,000.00 sustained by Flores. In RCPI v. Rodriguez,25 we ruled thus:
x x x. Nevertheless, we find the award of P 100,000.00 as moral damages in favor of respondent Rodriguez
excessive and unconscionable. In the case of Prudenciado v. Alliance Transport System, Inc. (148 SCRA 440
[1987]) we said: x x x [I]t is undisputed that the trial courts are given discretion to determine the amount of
moral damages (Alcantara v. Surro, 93 Phil. 472) and that the Court of Appeals can only modify or change the
amount awarded when they are palpably and scandalously excessive so as to indicate that it was the result of
passion, prejudice or corruption on the part of the trial court, (Gellada v. Warner Barnes & Co., Inc., 57 O.G. [4]
7347, 7358; Sadie v. Bachrach Motors Co., Inc., 57 O.G. [4] 636 and Adone v. Bachrach Motor Co., Inc., 57 O.G.
656). But in more recent cases where the awards of moral and exemplary damages are far too excessive compared
to the actual losses sustained by the aggrieved Party, this Court ruled that they should be reduced to more
reasonable amounts. x x x (Italics Ours.)
In other words, the moral damages awarded must be commensurate with the loss or injury suffered.
Similarly, we have consistently declared that:
Moral damages though incapable of pecuniary estimations, are in the category of an award designed to
compensate the claimant for actual injury suffered and not to impose a penalty on the wrongdoer (San
Andres v. Court of Appeals, 116 SCRA 85 [1982] cited in Prudenciado v. Alliance Transport System, Inc. supra).26
We, likewise, take this opportunity to stress that:
[M]oral damages are emphatically not intended to enrich a complainant at the expense of the defendant. They are
awarded only to enable the injured party to obtain means, diversion or amusements that will serve to obviate
the moral suffering he has undergone, by reason of the defendants culpable action. Its award is aimed at the
restoration, within the limits of the possible, of the spiritual status quo ante, and it must be proportional to the
suffering inflicted.27 (Italics ours.)
It is because of the foregoing reasons that we have had to constantly remind the courts to desist from awarding
excessive damages disproportionate to the peculiar circumstances of the case. Judicial discretion granted to the
courts in the assessment of damages must always be exercised with balanced restraint and measured
objectivity.28
Finally, we find petitioners act of issuing the managers checks and corresponding receipt before payment
thereof was completely counted reckless and grossly negligent. It is an appalling breach of bank procedures and
must never be repeated.
In Bautista v. Mangaldan Rural Bank, Inc.,29 we stated, thus:
The banking system has become an indispensable institution in the modern world and plays a vital role in the
economic life of every civilized society. Whether as mere passive entities for the safe-keeping and saving of
money or as active instruments of business and commerce, banks have attained an ubiquitous presence among
the people, who have come to regard them with respect and even gratitude and, most of all, confidence. (Simex
International [Manila], Inc. vs. Court of Appeals, G.R. No. 88013, March 19, 1990, 183 SCRA 360).
However, the award of P1,000,000.00 exemplary damages is also far too excessive and should likewise be
reduced to an equitable level. Exemplary damages are imposed not to enrich one party or impoverish another
but to serve as a deterrent against or as a negative incentive to curb socially deleterious actions.30
Therefore, based on the foregoing discussion, the award of moral damages is reduced to P 100,000.00 and
the exemplary damages is likewise reduced to P25,000.00.
We see no reason to disturb the award of attorneys fees in the amount of P50,000.00. We concur with the
findings of the Court of Appeals on this matter:
As for the award of attorneys fees, We find the same in order considering that defendant acted in gross and
evident bad faith in refusing to satisfy the plaintiffs plainly valid, just and demandable claim (Art. 2208 [5], New
Civil Code), and it is just and equitable to award plaintiff-appellee his attorneys fees (Art. 2208 [11], id.).31
WHEREFORE, premises considered, the assailed decision is hereby MODIFIED as follows:
1. The award of moral damages is reduced from P1,000,000.00 to P100,000.00; and
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

2. The award of exemplary damages is reduced from P1,000,000.00 to P25,000.00.

In all other respects, the assailed decision is hereby AFFIRMED.
SO ORDERED.

7. G.R. No. 122648 August 17, 2000

W-RED CONSTRUCTION AND DEVELOPMENT CORPORATION, petitioner,

vs.
COURT OF APPEALS and ASIA INDUSTRIES, INC., respondents.

YNARES-SANTIAGO, J.:

This is a petition for review seeking the reversal of the Decision of the Court of Appeals in CA-G.R. CV No. 37312.

It appears that on several occasions between May 28, 1980 and May 23, 1981, petitioner W-Red Construction
and Development Corporation purchased from respondent Asia Industries, Inc. various electrical equipment
worth P976,487.18, covered by a total of eighteen sales invoices.1 Petitioner was able to pay the sum of
P701,877.93, leaving a balance of P298,183.05, inclusive of interest at the rate of 14% per annum computed as
of January 20, 1982.2 For petitioner's failure to settle its remaining obligation despite demands, respondent
instituted on November 8, 1982 an action for sum of money and damages, filed with the Regional Trial Court of
Makati, Branch 65, as Civil Case No. 3094.3

Petitioner filed its answer,4 denying receipt of some of the items stated in the sales invoices and alleging that
certain electrical equipment delivered to it were defective or faulty, for which proper demands for replacement
were ignored by respondent.

After respondent, as plaintiff therein, rested its case, petitioner filed a demurrer to evidence 5 which, however,
was denied by the trial court in an Order dated August 28, 1991.6 Petitioner was given opportunity to adduce
evidence but it failed to appear at the several hearings scheduled therefor. The trial court, thus, declared
petitioner as having waived its right to present evidence.

On January 22, 1992, the trial court rendered judgment for respondent ordering petitioner to pay the sum of
P298,163.05 plus 14% interest from the date of filing of the complaint; P10,000.00 as attorney's fees and costs. 7

On appeal, the Court of Appeals affirmed the judgment of the trial court in a decision dated August 31,
1995.8Petitioner filed a Motion for Reconsideration, but the same was denied by the Court of Appeals in a
Resolution dated November 7, 1995.9
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
Hence, this petition for review anchored on the sole ground that:
THE RESPONDENT COURT OF APPEALS AS WELL AS THE TRIAL COURT COMMITTED A GRAVE ABUSE
OF DISCRETION WHEN THEY ADMITTED AND CONSIDERED PRIVATE DOCUMENTS AS EVIDENCE
WHEN SAID DOCUMENTS WERE NOT AUTHENTICATED NOR IDENTIFIED.
Respondent failed to file its comment on the petition for review despite our Resolution,10 for which reason we
required it to show cause why it should not be disciplinarily dealt with or held in contempt.11 The latter
Resolution was returned unserved.12 On January 31, 1997, Atty. Caesar F. Mones, counsel of record for
respondent, manifested that as early as 1991 he had severed his attorney-client relationship with respondent.
The Resolution requiring respondent to comment was sent to its office address. Respondent, still, failed to file its
comment and, according to information furnished by its former counsel, it was in the process of winding up its
business. On June 28, 1999, we dispensed with respondent's comment.
In the instant petition, petitioner maintains that the sales invoices presented by respondent during the trial
were inadmissible for being mere photocopies which, moreover, were not authenticated by respondent's lone
witness. Likewise, the Statement of Account showing petitioner's unpaid obligation to respondent was not
identified and authenticated by the person who prepared it.
Petitioner's claim that the photocopies of the eighteen sales invoices, marked as Exhibits "A" to "R", are
inadmissible, is untenable. While only photocopies of the documents are submitted to the court, the record
shows that the originals of these documents were presented during the trial. Hence, it is not accurate to say that
the original exhibits were not presented before the trial court. This became clear at the beginning of the cross-
examination of respondent's witness by petitioner's counsel:
ATTY. GINETA (for petitioner):
Mrs. Witness, with regard to sales invoices Exhs. A to R which I would like to make of record
that they are only xerox copies, Your Honor.
ATTY. MONES (for respondent):
May I manifest, Your Honor, that during the direct examination of the witness the originals
were already shown.
COURT:
For the information of the counsel, the practice of the Court is that if the exhibits were
marked without the word conditional, that means that the originals were presented. If the
word appears Exh. etc. conditionally, it means the original is not yet presented.
ATTY. GINETA:
Because I was not the lawyer then, Your Honor.
COURT:
Alright, never mind.13
Petitioner also objects to the admissibility of the statement of account, Exhibit "S", on the ground that it was not
authenticated and identified by the person who prepared it.
As correctly found by the Court of Appeals, respondent's only witness, Alma Ramas, was not entirely
incompetent to testify on petitioner's obligation. It was sufficiently established that Ms. Ramas, who was
connected with the credit and collection department, was in charge of monitoring the credit purchases of
customers, including petitioner.14
Having ruled on the admissibility of respondent's documentary evidence, the next issue to be resolved is the
weight of said exhibits, for admissibility of evidence should not be confused with its probative value. 15 On this
score, the factual findings of the trial court and the Court of Appeals, which are not shown to be manifestly
erroneous or unsupported by the record, deserve great respect. The Supreme Court is not a trier of facts. Thus,
factual findings of trial courts, when adopted and confirmed by the Court of Appeals, are binding and conclusive
and, generally, will not be reviewed on appeal.16
To begin with, this Court is not a trier of facts. It is not its function to examine and determine the
weight of the evidence supporting the assailed decision. In Philippine Airlines, Inc. vs. Court of Appeals
(275 SCRA 621 [1997]), the Court held that factual findings of the Court of Appeals which are
supported by substantial evidence are binding, final and conclusive upon the Supreme Court. So also,
well-established is the rule that "factual findings of the Court of Appeals are conclusive on the parties
and carry even more weight when the said court affirms the factual findings of the trial court."
Moreover, well entrenched is the prevailing jurisprudence that only errors of law and not of facts are
reviewable by this Court in a petition for review on certiorari under Rule 45 of the Revised Rules of
Court, which applies with greater force to the Petition under consideration because the factual findings
by the Court of Appeals are in full agreement with what the trial court found.17
In this case, we find no cogent ground to disturb the conclusions of the Court of Appeals and the trial court. We,
therefore, affirm the appealed decision.
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CV No. 37312 is AFFIRMED.1âwphi1.nêt
SO ORDERED.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

8. [G.R. No. 142441. November 10, 2004]

PEDRO BONGALON now substituted by FILIPINA BONGALON, petitioner, vs. COURT OF APPEALS, CECILIO
BONGALON and AMPARO BONGALON, respondents.

DECISION
CARPIO, J.:

The Case
This is a petition for review[1] of the Decision[2] dated 27 November 1992 of the Court of Appeals and its
Resolution dated 23 February 2000. The 27 November 1992 Decision reversed the Decision[3] dated 28 June
1991 of the Regional Trial Court, Branch 17, Tabaco, Albay (RTC) while the 23 February 2000 Resolution denied
the motion for reconsideration.

The Facts
Pedro Bongalon, the late husband of petitioner Filipina Bongalon (petitioner), respondents Cecilio
Bongalon (Cecilio) and Amparo Bongalon (Amparo) and four[4] others are the children of the late Cirila Bonga
(Cirila) and Bernabe Bongalon (Bernabe). Cirila is one of the five children of Rosalia Buenaflor (Rosalia) and
Cornelio Bonga (Cornelio). The other children of Rosalia and Cornelio are Trinidad Bonga Bobier (Trinidad),
Jacoba Bonga Faustino (Jacoba), Emilio Bonga (Emilio) and Benito Bonga (Benito). Jacoba had three children,
namely, Conchita Faustino Base (Conchita), Catalina Faustino Conlo (Catalina), and Leonardo Faustino
(Leonardo). Emilio also had three children, namely, Teodora Bonga Bien (Teodora), Francisca Bonga Camba
(Francisca), and Maxima Bonga Diaz (Maxima). It appears that Jacoba and Emilio predeceased their children. [5]
Rosalia was the owner of Lot No. 525-A in A. A. Berces St., Tabaco, Albay measuring 149 square meters and
covered by Original Certificate of Title No. RO-17402 (23825) (OCT No. RO-17402) issued in her name. OCT No.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
RO-17402 was later cancelled and replaced by Transfer Certificate of Title No. T-67656 (TCT No. T-67656) also
issued in Rosalias name.[6] Rosalia died intestate in 1940, survived by her husband and five children.
On 26 July 1943, Trinidad, Conchita, and Teodora executed a Deed of Absolute Sale (Exhibit 2)[7] conveying
to Cirila a part of Lot No. 525-A for P100. On the same day, Cirila, and again Trinidad, Conchita, and Teodora,
executed a Deed of Absolute Sale (Exhibit B)[8] conveying to Pedro Bongalon a part of Lot No. 525-A also
for P100. The same notary public notarized both deeds of sale on that same day. On 22 February 1971, Cirila
executed another Deed of Absolute Sale (22 February 1971 Deed of Sale)[9] conveying Lot No. 525-A to Amparo
for P4,500. Amparo subsequently declared Lot No. 525-A in her name for tax purposes and paid the real estate
taxes in 1977 and 1978. Even before the execution of the 22 February 1971 Deed of Sale, Amparo and her family
were already occupying a 32-square meter portion of Lot No. 525-A where her house stands.[10]
Meanwhile, on 30 January 1979, Pedro Bongalon executed an Extrajudicial Settlement of Estate
(Extrajudicial Settlement) declaring that Cirila is the only heir of Rosalia and that he (Pedro Bongalon) is, in turn,
the only heir of Cirila. Based on this Extrajudicial Settlement, Pedro Bongalon secured the cancellation of TCT
No. T-67656 and obtained Transfer Certificate of Title No. T-67780 (TCT No. T-67780) issued in his name.
In March 1988, Pedro Bongalon sued respondents in the RTC for Quieting of Title, Recovery of Portion of
Property and Damages. Pedro Bongalon alleged in his complaint that: (1) he is the registered owner of Lot No.
525-A under TCT No. T-67780; (2) respondents occupied Lot No. 525-A through his tolerance; (3) he had several
times asked respondents to vacate Lot No. 525-A but they refused to do so; and (4) respondents occupancy of
Lot No. 525-A and their claim of ownership over the property cast a cloud over his title. Pedro Bongalon prayed
that the RTC declare his title free of any cloud and order respondents to vacate Lot No. 525-A and pay him
damages and litigation expenses.[11]
In their Answer with Counterclaim, respondents denied Pedro Bongalons allegations. Respondents
claimed that Pedro Bongalon fraudulently obtained TCT No. T-67780 by executing the Extrajudicial
Settlement. Amparo claimed that on the contrary, she is the owner of Lot No. 525-A based on the 22 February
1971 Deed of Sale. As counterclaim, respondents sought the nullification of the Extrajudicial Settlement and of
TCT No. T-67780. Respondents also prayed for the award of damages and attorneys fees.[12]
During the trial, Pedro Bongalon introduced in evidence other documents to prove his ownership
of Lot No. 525-A, such as (1) Exhibit B and (2) Conchitas Affidavit dated 22 May 1978 (Exhibit C)[13] confirming
the sale under Exhibit B. The RTC admitted these documents in evidence over the objection of respondents.
For their part, respondents also presented in evidence Exhibit 2 to prove that Cirila owned the entire Lot
No. 525-A which she later sold to Amparo in the 22 February 1971 Deed of Sale.
Before the RTC could render judgment, Amparo died and her surviving spouse and six children substituted
for her.[14]
The Trial Courts Ruling
On 28 June 1991, the RTC rendered judgment (RTC Decision) the dispositive portion of which provides:
WHEREFORE, summing up the evidence, oral and documentary, presented by both parties, Judgment is
rendered for the plaintiff and against the defendants.
The Court orders, as it is hereby ordered, that the plaintiff is declared the rightful registered owner of the land
consisting of One Hundred Forty Nine (149) square meters, more or less, located at A. A. Berces St., Tabaco,
Albay, under Transfer Certificate of Title No. T-67780, in the name of Pedro Bongalon, said title is free from
defect, flaw and cloud of doubt, therefore, indefeasible.
The defendants are likewise ordered to vacate and to deliver the portion of the land in question they have
occupied to the plaintiff peacefully. And to pay the costs proportionately. [15]
The RTC Decision reads:
From the documentary evidence adduced during the hearing by both parties, it appeared that the real
property/land in question was formerly and originally owned by Rosalia Buenaflor, covered by Original
Certificate of Title No.[RO-17402 (23825)], then to [T-]67656, then to [T-67780], containing an area of One
Hundred Forty Nine (149) square meters, more or less, located at then Taylor Street now A. A. Berces Street,
Tabaco, Albay. Rosalia Buenaflor married Cornelio Bonga and begot children, namely: Cirila, Trinidad, Jacoba,
Emilio and Benito, all surnamed Bonga. Daughter Cirila Bonga got married to Bernabe Bongalon and begot seven
(7) children, namely: Pedro, Cecilio, Amparo, Eleuteria and others, all surnamed Bongalon.
On July 26, 1943, two (2) documents were executed over the same parcel of land, this in question (sic).
First document, Exhibit-2 defendants, Absolute Deed of Sale was executed and signed by vendors Trinidad
Bonga, Conchita Faustino, Teodora Bonga, heirs and children of Rosalia Buenaflor Bonga, [conveying] a part of
the property in question xxx in favor of vendee Cirila Bonga xxx. Said Absolute Deed of Sale was notarized and
acknowledged on July 26, 1943 by a notary public and entered as Doc. No. 2, Page 15, Book No. 1, Series of 1943.
Second document, Exhibit B plaintiff, Absolute Deed of Sale was executed and signed by vendors Trinidad Bonga,
Cirila Bonga, Conchita B. Faustino (sic) and Teodora Bonga, heirs and children of Rosalia Buenaflor Bonga,
[conveying] a part of the property in question in favor of vendee Pedro Bongalon (son of Cirila Bonga Bongalon),
xxxx Said document was notarized and acknowledged on July 26, 1943 by a Notary Public and entered as Doc.
No. 2, Page No. 15, Book No. 1, Series of 1943.
The Exhibit-2 for the defendants and the Exhibit-B for the plaintiff, contained a handwritten insertion, to wit, a
part of and initialled, which is unclear, found in the first paragraph, later portion. Both documents are (sic)
prepared/executed/signed by the same persons/ signatories, acknowledged and notarized by the same Notary
Public, Zosimo R. Almonte. Both documents, Absolute Deed of Sale, printed and expressed particular same
boundaries and description of the whole area which is One Hundred Forty Nine (149) square meters, more or
less, but did not contain expressly the part/portion of said property [sold].
Circumstances surrounding the execution of these two (2) documents is concluded (sic) and construed that
Exhibit-B for the plaintiff has to be given weight and effect. This, the entire area of 149 square meters, more or
less, is the subject of the sale as Cirila Bonga is now one of the four (4) vendors. Each vendor shared or owned at
least 37 square meters and 25 centimeters of this land in question, to be candid and clear.
In possession of the Deed of Absolute Sale, vendee Pedro Bongalon applied, processed and managed to have the
ownership of said property transferred in his name by submitting an Affidavit of Confirmation, by Conchita F.
Base, one of the vendors, dated May 22, 1978 duly subscribed and sworn to by Notary Public Julian C. Cargullo,
entered as Doc. No. 92, Page No. 21, Book No. VII, Series of 1978 and an Extrajudicial Settlement of Estate, this is
a requirement. Finally, Transfer Certificate of Title No. T-67780 in the name of Pedro Bongalon was issued on
[January] 25, 1985. This is an indefeasible title of ownership in favor of the plaintiff.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
On February 22, 1971, again Cirila Bonga, vendor again (sic), executed and signed another Deed of Absolute Sale,
Exhibit-1 for the defendants, in favor of Amparo Bongalon Cortezano, vendee, married to Atenogenes A.
Cortezano of the same entire parcel of land in question of 149 square meters, more or less, acknowledged and
notarized by Notary Public Joel C. Atadero, entered as Doc. No. 1031, Page No. 77, Book No. VII, Series of
1971. By virtue of this instrument, Cortezano, Amparo procured Tax Declaration No. 0020 in her name declaring
the entire 149 square meters for taxation purposes for the year 1985 in her name and where a 32 square meters
of a house (sic) is constructed thereon.
Exhibit-1 for the defendants, Deed of Absolute Sale by vendor Cirila Bonga to the latters daughter vendee
Amparo Bonga Cortezano is defective having a flaw or cloud in the rights of an owner. She, Cirila Bonga, is not
the only owner of said land. Previously on July 26, 1943 said parcel of land was a subject of Absolute Deed of
Sale in favor of Pedro Bongalon, the brother of vendee of Exhibit-1 Amparo Bongalon Cortezano, by the rightful
owners/vendors of the land in question.
Yet it can be argued that the plaintiffs Extrajudicial Settlement of Estate is a defect, a minor one, but what is
controlling is Exhibit-B, Absolute Deed of Sale in his favor dated July 26, 1943, and the Affidavit of Confirmation
of Conchita F. Base.
xxxx
Considering the evidence, and with careful perusal of the same adduced by both parties at the hearing, the Court
honestly believes, so holds and is of the strong opinion, that the plaintiffs cause of action is sufficiently
impressed with merit supporting his claim of possession, as well as ownership of the land.[16]
Respondents appealed to the Court of Appeals.
The Court of Appeals Ruling
In its 27 November 1992 Decision, the Court of Appeals reversed the RTC Decision. The Court of Appeals
held:
PREDICATED on the evidence and the law in point, the appeal in this case is sufficiently impressed with merit.
IN THE FIRST PLACE, the basis of the complaint filed by the plaintiff-appellee is that he acquired the property in
question by inheritance from his predecessors-in-interest and not by purchase. This fact is shown by the
Annotation xxx of the Extrajudicial Settlement of Estate xxx which was the supporting document that authorized
the cancellation of TCT No. T-67656 xxx in the name of the original registered owner Rosalia Buenaflor and the
issuance of TCT No. T-67780 in favor of and in the name of plaintiff-appellee Pedro Bongalon. In other words,
the Extrajudicial Settlement of Estate (which is by inheritance) is the basis of both the complaint and the
transfer of the certificate of title from the original owner to the plaintiff-appellee.
SECONDLY, in the trial of the case, what was introduced in evidence were the Deed of Absolute Sale (Exhibit B)
and the Affidavit of Confirmation (Exhibit C), though these were never alleged in the complaint. What was
alleged in the complaint was the Extrajudicial Settlement of Estate xxx or the mode of inheritance (sic). That is
why, the defendants-appellants counsel vigorously objected of (sic) the admission of Exhibit B and Exhibit C on
the ground that no evidence can be introduced in support of allegation not found in the pleadings
xxx. Consequently, the trial court should not have admitted Exhibits B and C as part of the evidence.
THIRDLY, the only ground upon which plaintiff-appellee can base his stand is the Deed of Absolute Sale (Exh. B)
and the Deed of Confirmation (Exh. C) after suppressing the presentation and submission of xxx the Extrajudicial
Settlement of Estate. Since Exhibit B and Exhibit C should not have been considered or admitted because the
same were not alleged in the complaint xxx, the only remaining issue is TCT No. T-67780.
FOURTHLY, plaintiff-appellee Pedro Bongalon, as already stated, executed the Extrajudicial Settlement of Estate
xxx falsely alleging that the original registered owner Rosalia Buenaflor and husband were survived by their
only daughter Cirila Bonga Bongalon, mother of the plaintiff-appellee, when in fact Cirila Bonga Bongalon was
survived by her seven (7) children namely: Amparo, Cecilio, Eleuterio (sic), Jose, Gloria, Anastacio and
Pedro. The first two names are the defendants-appellants and the last one is the plaintiff-appellee. Consequently,
the Extrajudicial Settlement of Estate is tainted with fraud, brazen lies and grave misrepresentation which the
lower court recognized as a defect, though a minor one, in view of Exhibit B and Exhibit C. It is inevitable that the
trial court should have correctly nullified TCT No. T-67780 on the aforecited grounds. For well-settled is the rule
that when a party resorts to falsehood to advance his suit, it is presumed that he knows perfectly well that his
cause is groundless and this presumption affects the whole mass of evidence presented by such party xxx.
AFTER a careful review of the entire evidence, We perceive no difficulties in sustaining the validity of
defendants-appellants claim or posture.
ACCORDINGLY, in the light of the foregoing disquisitions, the decision of the Court a quo is hereby REVERSED
and SET ASIDE and a new one is rendered dismissing the case, with costs against the plaintiff-
appellee.[17] (Capitalization and underlining in the original)
Pedro Bongalon sought reconsideration but the Court of Appeals denied his motion in its 23 February
2000 Resolution.[18]
Hence, this petition.[19]
The Issues
Petitioner raises the following issues for resolution:
I. WHETHER THE COURT OF APPEALS GRAVELY ERRED IN REVERSING THE DECISION OF THE
TRIAL COURT;
II. WHETHER THE DECISION OF THE COURT OF APPEALS IS IN ACCORD WITH THE FACTS,
EVIDENCE AND THE PERTINENT LAWS, PARTICULARLY THE PROVISIONS OF THE CIVIL CODE
ON SALE, POSSESSION AND OWNERSHIP.[20]
In their Comment, Cecilio and the heirs of Amparo reiterate their prayer to nullify TCT No. T- 67780 and
the Extrajudicial Settlement.
The Ruling of the Court
The petition is partly meritorious.
Labor RELATIONS ASSIGNMENT 1 FULL TEXT
On the Admissibility of Exhibits B and C
It was error for the Court of Appeals to rule that the RTC should not have admitted in evidence Exhibits B
and C because Pedro Bongalon failed to allege these documents in his complaint. What was at issue before the
RTC, as raised in the pleadings filed by the parties, was the ownership of Lot No. 525-A. Pedro Bongalon offered
the pieces of evidence in question to support his claim of ownership over Lot No. 525-A. The fact that Pedro
Bongalon did not mention Exhibits B and C in his complaint is not a reason to rule them inadmissible. While TCT
No. T-67780 was Pedro Bongalons principal proof of ownership, it did not preclude him from presenting other
pieces of evidence to prove his claim. This is especially relevant because of his testimony that he executed the
Extrajudicial Settlement only because the Register of Deeds of Albay required it for the issuance of TCT No. T-
67780.[21]
The Basis and Extent of Pedro Bongalons
Interest in Lot No. 525-A
There is no dispute that Lot No. 525-A was Rosalias paraphernal property. Thus, when Rosalia died
intestate, she passed on this piece of property to her surviving spouse Cornelio and their five children, namely,
Cirila, Trinidad, Jacoba, Emilio, and Benito. These heirs inherited Lot No. 525-A in co-ownership, at 1/6
undivided share each.[22] After Cornelio died, his 1/6 undivided share passed to his surviving five children per
stirpes, thus increasing their undivided shares to 1/5 each. The 1/5 undivided share of Jacoba, who apparently
predeceased her children Conchita, Catalina, and Leonardo, passed to Jacobas children as co-owners in equal
shares. Likewise, the undivided 1/5 share of Emilio, who also apparently predeceased his children Teodora,
Francisca, and Maxima, passed to Emilios children as co-owners in equal shares.
Under Exhibit 2, Trinidad, Teodora, and Conchita sold to Cirila a part of Lot No. 525-A on 26 July
1943.[23] Since these co-owners could alienate their undivided shares,[24] they sold under Exhibit 2 their
undivided shares in Lot No. 525-A to Cirila. Similarly, on the same day, Cirila (and again Trinidad, Teodora, and
Conchita), executed Exhibit B conveying to Pedro Bongalon a part of Lot No. 525-A. Thus, Cirila sold to Pedro
Bongalon her original 1/5 share and the combined undivided shares of Trinidad, Teodora and Conchita she
earlier acquired under Exhibit 2.[25] The participation of Trinidad, Teodora and Conchita in Exhibit B, while
superfluous (as they had earlier sold their undivided shares to Cirila), does not detract from the validity of
Exhibit B. In sum, Pedro Bongalons interest in Lot No. 525-A covers only the undivided shares of Cirila, Trinidad,
Teodora, and Conchita.
Thus, contrary to the RTC Decision, Pedro Bongalon did not acquire ownership of the entire Lot No. 525-A
under Exhibit B. As the other co-owners, namely, the heirs of Benito Bongalon, and the other children of Jacoba
(Catalina and Leonardo) and Emilio (Francisca and Maxima) did not sign either Exhibit B or Exhibit 2, they
remained co-owners of Lot No. 525-A. While each co-owner has full ownership of his part and may alienate it,
the alienation affects only the portion which pertains to him in the division upon the termination of the co-
ownership.[26]
Neither can petitioner invoke Exhibit C to support her claim that Pedro Bongalon owns the entire Lot No.
525-A. Conchita stated in that document that all the children and descendants of Rosalia (except for
Cirila)[27] sold their respective undivided shares to Pedro Bongalon under Exhibit B. This statement, however, is
obviously false since only Cirila, Trinidad, Teodora and Conchita signed Exhibit B. The other co-owners of Lot
No. 525-A who did not affix their signatures in such document did not sell their shares to Pedro Bongalon.
On Whether the 22 February 1971 Deed
of Sale Casts a Cloud on Pedro Bongalons Title
A cloud on title to real property or any interest therein is any instrument, record, claim, encumbrance or
proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or
unenforceable, and may be prejudicial to said title.[28] The Court finds that the 22 February 1971 Deed of Sale
casts a cloud on Pedro Bongalons interest over Lot No. 525-A. While apparently valid, the 22 February
1971 Deed of Sale is in fact void and prejudicial to the interest of Pedro Bongalon and his heirs. This document
purports to show that Amparo was the owner of such property when in fact she was not. This document is void
because at the time of its execution, Cirila had no more interest to sell in Lot No. 525-A because she had sold all
her interest in that property to Pedro Bongalon in 1943 under Exhibit B. Thus, Cirilas other children, including
Amparo and Cecilio, cannot claim any interest over Lot No. 525-A, either by contract, in the case of Amparo, or
by hereditary rights, in the case of Cecilio. Amparos subsequent declaration of Lot No. 525-A under her name for
tax purposes (and her payment of the real estate taxes in 1977 and 1978) did not change her status as a stranger
to that property. Cecilio and the heirs of Amparo have no right to remain in Lot No. 525-A much less construct
improvements on that property.
On the Validity of the Extrajudicial Settlement
and of TCT No. T-67780
Respondents squarely raised in the RTC and in the Court of Appeals the issue of the validity of the
Extrajudicial Settlement and of TCT No. T-67780. It was thus incumbent upon these courts to resolve this issue.
The RTC failed to do so. On the other hand, the Court of Appeals stated in its 27 November 1992 Decision that
the Extrajudicial Settlement contained material misrepresentations which nullified TCT No. T-67780. However,
the Court of Appeals inexplicably failed to make a ruling on the status of these two documents in the dispositive
portion of its ruling. This is error. Having taken cognizance of an action for quieting of title, both courts should
have adjust[ed] all equities of all the parties to the action and determine[d] the status of all controverted claims
to or against the property.[29]
There is no question that Pedro Bongalon falsely stated in the Extrajudicial Settlement that Cirila was the
only heir of Rosalia and that he (Pedro Bongalon), in turn, was the sole heir of Cirila. As the Court of Appeals
correctly noted, this is not a minor defect but in fact renders the document void. Consequently, TCT No. T-67780,
which the Register of Deeds of Albay issued based on the Extrajudicial Settlement, must be cancelled.
In Ramirez v. CA,[30] also involving a case for quieting of title, this Court annulled several Transfer Certificates of
Title on the ground that they were issued based on void documents.
The cancellation of the Extrajudicial Settlement and TCT No. T-67780 does not deprive Pedro Bongalon or
his heirs of the right to maintain this action for quieting of title. Under Article 477 of the Civil Code, it is sufficient
that the plaintiff has legal or equitable title to or interest in the real property which is the subject matter of the
action. Pedro Bongalons acquisition of the shares of Cirila, Trinidad, Conchita, and Teodora vested him with the
necessary legal interest over Lot No. 525-A.
WHEREFORE, we GRANT the petition in part. We SET ASIDE the Decision dated 27 November 1992 and
the Resolution dated 23 February 2000 of the Court of Appeals. We enter a new judgment as follows:
(1) The Deed of Sale dated 22 February 1971 and the Deed of Extrajudicial Settlement dated 30
January 1979 are ANNULLED.
(2) Transfer Certificate of Title No. T-67780 is CANCELLED. The Register of Deeds of Albay is
ordered to restore Transfer Certificate of Title No. T-67656 in the name of Rosalia Buenaflor,
without prejudice to the issuance of another Transfer Certificate of Title in the name of Pedro
Labor RELATIONS ASSIGNMENT 1 FULL TEXT

Bongalon and the other co-owners of Lot No. 525-A, namely, Benito Bongalon, Catalina
Faustino Conlo, Leonardo Faustino, Francisca Bonga Camba, and Maxima Bonga Diaz.
(3) Respondent Cecilio Bongalon and the heirs of Amparo Bongalon are ordered to vacate Lot No.
525-A and to remove all the improvements they have constructed on Lot No. 525-A.
SO ORDERED.