ANTONIO P. TAMBUNTING, JR.

and COMMERCIAL HOUSE OF FINANCE,

INC., vs. SPOUSES EMILIO SUMABAT and ESPERANZA BAELLO
FACTS: This case involves a dispute over a parcel of land situated in
Caloocan. It was previously registered in the names of respondents, spouses
Emilio Sumabat and Esperanza Baello. Respondents mortgaged it to
petitioner Antonio Tambunting, Jr. to secure the payment of a loan.
Respondents defaulted in their obligation, thus, petitioner CHFI, as assignee
of the mortgage, initiated foreclosure proceedings on the mortgaged
property but the same did not push through. It was restrained by the then
CFI of Caloocan City. However, the case was subsequently dismissed for
failure of the parties to appear at the hearing.
Respondents filed an action for declaratory relief with the CFI of Caloocan
City seeking a declaration of the extent of their actual indebtedness.
Petitioners were declared in default for failure to file an answer within the
reglementary period. They moved for the dismissal but was denied.
The CFI rendered its decision, fixing respondents’ liability at ₱15,743.83 and
authorized them to consign the amount to the court for proper disposition.
Respondents received a notice of sheriff’s sale indicating that the mortgage
had been foreclosed by CHFI and that an extrajudicial sale of the property
would be held.
Respondents instituted a petition for preliminary injunction, damages and
cancellation of annotation of encumbrance with prayer for the issuance of a
temporary restraining order, with the RTC of Caloocan City. However, the
public auction scheduled on that same day proceeded and the property was
sold to CHFI as the highest bidder. Respondents failed to redeem the
property during the redemption period. Hence, title to the property was
consolidated in favor of CHFI and a new certificate of title was issued in its
name. In view of these developments, respondents amended their complaint
to an action for nullification of foreclosure, sheriff’s sale and consolidation of
title, reconveyance and damages.
RTC issued the assailed decision. It ruled that the CFI decision had long
attained finality. Petitioners moved MR but it was denied.

ISSUE: Whether or not trial court erred when it affirmed the validity of the
consignation

HELD: The trial court erred when it ruled that the CFI decision was already
final and executory.
An action for declaratory relief should be filed by a person interested under a
deed, will, contract or other written instrument, and whose rights are
affected by a statute, executive order, regulation or ordinance before breach
or violation thereof. The purpose of the action is to secure an authoritative
statement of the rights and obligations of the parties under a statute, deed,
contract, etc. for their guidance in its enforcement or compliance and not to
settle issues arising from its alleged breach. It may be entertained only
before the breach or violation of the statute, deed, contract, etc. to which it
refers. Where the law or contract has already been contravened prior to the
filing of an action for declaratory relief, the court can no longer assume
jurisdiction over the action. In other words, a court has no more jurisdiction
over an action for declaratory relief if its subject, i.e., the statute, deed,
contract, etc., has already been infringed or transgressed before the
institution of the action. Under such circumstances, inasmuch as a cause of
action has already accrued in favor of one or the other party, there is nothing
more for the court to explain or clarify short of a judgment or final order.

ZENAIDA ORTEGA, represented by Her Attorney-in Fact OCTAVIO

ALVAREZ and/or ZEMVE ORTEGA ALVAREZ vs. THE QUEZON CITY
GOVERNMENT, THE NATIONAL HOUSING AUTHORITY & THE
NATIONAL HOME MORTGAGE CORP., 
FACTS: Petitioner Zenaida Ortega assailed the validity of Quezon City
Ordinance No. SP 1304, Series of 2003, and praying that the following
agencies, National Housing Authority (NHA), Housing and Land Use
Regulatory Board (HLURB), Department of Environment and Natural
Resources – Bureau of Land Management, National Home Mortgage
Financing Corporation, and Home Insurance Guarantee Corporation, be
restrained from implementing the said ordinance.
Proposed Ordinance No. 2002-07 (PO 2002-07) sought to approve "the
Subdivision Plan of Samahang Kapitbahayan ng Barangay Vasra (Samahang
Kapitbahayan), a Socialized Housing Project (B.P. Blg. 220) with 17 lots
(Community Mortgage Program) owned by the City Government of Quezon
City (Vendor) located at a portion of [an] easement [in] Barangay Vasra,
Quezon City, Metro Manila, as applied for by the Samahang Kapitbahayan ng
Barangay Vasra (Vendee).
Proposed Resolution No. 2003-13 (PR 2003-13) sought to authorize Quezon
City Mayor Feliciano R. Belmonte to enter into a contract to sell a portion of
an easement located at Barangay Vasra, Quezon City with the SAMAHANG
KAPITBAHAYAN to be represented by its President, through the Community
Mortgage Program (CMP) of the National Home Mortgage Finance
Corporation (NHMFC).
Quezon City government enacted Ordinance No. SP-1304, Series of 2003
(the ordinance), which is being challenged in the present petition,
reclassifying "as residential or converted from its original classification to
residential for distribution or for sale to its informal settlers" a "parcel of land
which may be considered an accretion/excess lot and previously conceived
and referred to in Proposed Ordinance No. 2002-07 and Proposed
[Resolution] 2002-13 as portion of [an] easement situated between Block 14,
Psd-39577 of the original subdivision plan and Culiat Creek, Barangay Vasra,
Quezon City."
Petitioner, who claims to be the rightful owner of the land subject of the
ordinance, alleges that in enacting the ordinance, her various letter-protests
to the City Council against proposed Resolutions No. 2002-13, 2002-07 and
2002-239 were not heeded in the City Council, thus violating her
constitutional rights to due process and equal protection of the law.

ISSUE: Whether or not the petitioner is entitled for declaratory relief

HELD: While a petition for declaratory relief may be treated as one for
prohibition if it has far reaching implications and raises questions that need
to be resolved, there is no allegation of facts by petitioner tending to show
that she is entitled to such a writ. The judicial policy must thus remain that
this Court will not entertain direct resort to it, except when the redress
sought cannot be obtained in the proper courts or when exceptional and
compelling circumstances warrant availment of a remedy within and calling
for the exercise of this Court’s primary jurisdiction.

IN THE MATTER OF THE PETITION FOR DECLARATORY JUDGMENT

REGARDING THE VALIDITY OF ORDINANCE NO. 386 OF THE CITY OF
BAGUIO, BAGUIO CITIZENS ACTION INC., and JUNIOR CHAMBER OF
BAGUIO CITY, INC., vs. THE CITY COUNCIL AND CITY MAYOR OF THE
CITY OF BAGUIO
FACTS: In this petition for declaratory relief originally filed in the CFI of
Baguio what is involved is the validity of Ordinance 386 passed by the City
Council of Baguio City. The Ordinance is entitled “AN ORDINANCE
CONSIDERING ALL SQUATTERS OF PUBLIC LAND, OTHER THAN THOSE
EARMARKED FOR PUBLIC USE IN THE CITY OF BAGUIO WHO ARE DULY
REGISTERED AS SUCH AT THE TIME OF THE PROMULGATION OF THIS
ORDINANCE AS BONAFIDE OCCUPANTS OF THEIR RESPECTIVE LOTS AND
WHICH SHALL HEREAFTER BE EMBRACED AS A CITY GOVERNMENT HOUSING
PROJECT AND PROVIDING FOR OTHER PURPOSES.”
The petition for declaratory relief filed with the Court of First Instance of
Baguio prays for a judgment declaring the Ordinance as invalid and illegal ab
initio. The respondents-appellees, the City Council and the City Mayor, filed
motions to dismiss the petition which were denied.

ISSUE: Whether or not the Ordinance is valid

HELD: A declaration on the nullity of the ordinance, would give the squatters
no right which they are entitled to protect. The party most interested to
sustain and defend the legality of the Ordinance is the body that passed it,
the City Council, and together with the City Mayor, is already a party in these
proceedings.
The Ordinance in question is a patent nullity. It considered all squatters of
public land in the City of Baguio as bona-fide occupants of their respective
lots.

PHILIPPINE DEPOSIT INSURANCE CORPORATION vs. THE HONORABLE

COURT OF APPEALS and JOSE ABAD, LEONOR ABAD, SABINA ABAD,
JOSEPHINE "JOSIE" BEATA ABAD-ORLINA, CECILIA ABAD, PIO ABAD,
DOMINIC ABAD, TEODORA ABAD
FACTS:
The present petition for review assails the decision of the Court of Appeals
affirming that of the RTC Iloilo City finding petitioner liable, as statutory
insurer, for the value of 20 Golden Time Deposits belonging to respondents
Jose Abad, Leonor Abad, Sabina Abad, Josephine "Josie" Beata Abad-Orlina,
Cecilia Abad, Pio Abad, Dominic Abad, and Teodora Abad at the Manila
Banking Corporation, Iloilo Branch.
Prior to May 22, 1997, respondents had, individually or jointly with each
other, 71 certificates of time deposits denominated as "Golden Time
Deposits" (GTD) with an aggregate face value of P1,115,889.96.
The Monetary Board (MB) of the Central Bank of the Philippines, now BSP,
issued Resolution 505 prohibiting MBC to do business in the Philippines, and
placing its assets and affairs under receivership. The Resolution, however,
was not served on MBC until Tuesday the following week, or on May 26,
1987, when the designated Receiver took over.
On May 25, 1987, the next banking day following the issuance of the MB
Resolution, respondent Jose Abad was at the MBC at 9:00 a.m. for the
purpose of pre-terminating the 71 aforementioned GTDs and re-depositing
the fund represented thereby into 28 new GTDs in denominations of
P40,000.00 or less under the names of herein respondents individually or
jointly with each other. Of the 28 new GTDs, Jose Abad pre-terminated 8 and
withdrew the value thereof in the total amount of P320,000.00.
Respondents thereafter filed their claims with the PDIC for the payment of
the remaining 20 insured GTDs.
On February 11, 1988, PDIC paid respondents the value of 3 claims in the
total amount of P120,000.00. PDIC, however, withheld payment of the 17
remaining claims after Washington Solidum, Deputy Receiver of MBC-Iloilo,
submitted a report to the PDIC that there was massive conversion and
substitution of trust and deposit accounts on May 25, 1987 at MBC-Iloilo. 
Because of the report, PDIC entertained serious reservation in recognizing
respondents' GTDs as deposit liabilities of MBC-Iloilo. Thus, on August 30,
1991, it filed a petition for declaratory relief against respondents with the
RTC Iloilo City, for a judicial declaration determination of the insurability of
respondents' GTDs at MBC-Iloilo.
Iloilo RTC declared the 20 GTDs of respondents to be deposit liabilities of
MBC, hence, are liabilities of PDIC as statutory insurer. CA affirmed the RTC
decision.

ISSUE: Whether or not the CA erred in affirming the holding of the trial court
ordering petitioner to pay respondents' claims for payment of insured
deposits for the reason that an action for declaratory relief does not
essentially entail an executory process as the only relief that should have
been granted by the trial court is a declaration of the rights and duties of
petitioner
HELD: Without doubt, a petition for declaratory relief does not essentially
entail an executory process. There is nothing in its nature, however, that
prohibits a counterclaim from being set-up in the same action.
Now, there is nothing in the nature of a special civil action for
declaratory relief that proscribes the filing of a counterclaim based on
the same transaction, deed or contract subject of the complaint. A
special civil action is after all not essentially different from an ordinary
civil action, which is generally governed by Rules 1 to 56 of the Rules
of Court, except that the former deals with a special subject matter
which makes necessary some special regulation. But the identity
between their fundamental nature is such that the same rules
governing ordinary civil suits may and do apply to special civil actions
if not inconsistent with or if they may serve to supplement the
provisions of the peculiar rules governing special civil actions.