1. GENEVIEVE ROSAL ARREZA, A.K.A.

"GENEVIEVE ARREZA TOYO,"

vs.
TETSUSHI TOYO, LOCAL CIVIL REGISTRAR OF QUEZON CITY, AND THE
ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE NATIONAL
STATISTICS OFFICE, G.R. No. 213198, July 1, 2019

THIRD DIVISION

G.R. No. 213198, July 01, 2019

GENEVIEVE ROSAL ARREZA, A.K.A. "GENEVIEVE ARREZA TOYO," PETITIONER,

v. TETSUSHI TOYO, LOCAL CIVIL REGISTRAR OF QUEZON CITY, AND THE
ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE NATIONAL
STATISTICS OFFICE, RESPONDENTS.

DECISION

LEONEN, J.:

Philippine courts do not take judicial notice of foreign judgments and laws. They must
be proven as fact under our rules on evidence. A divorce decree obtained abroad is
deemed a foreign judgment, hence the indispensable need to have it pleaded and
proved before its legal effects may be extended to the Filipino spouse. 1

This Court resolves a Petition for Review on Certiorari 2 under Rule 45 of the Rules of
Court, praying that the Regional Trial Court's February 14, 2014 Judgment 3 and June
11, 2014 Resolution4 in SP. PROC. No. Q-12-71339 be reversed and set aside. The
Regional Trial Court denied Genevieve Rosal Arreza a.k.a. Genevieve Arreza Toyo's
(Genevieve) Petition for judicial recognition of foreign divorce and declaration of
capacity to remarry.5

On April 1, 1991, Genevieve, a Filipino citizen, and Tetsushi Toyo (Tetsushi), a

Japanese citizen, were married in Quezon City. They bore a child whom they named
Keiichi Toyo.6

After 19 years of marriage, the two filed a Notification of Divorce by Agreement, which
the Mayor of Konohana-ku, Osaka City, Japan received on February 4, 2011. It was
later recorded in Tetsushi's family register as certified by the Mayor of Toyonaka City,
Osaka Fu.7

On May 24, 2012, Genevieve filed before the Regional Trial Court a Petition for judicial
recognition of foreign divorce and declaration of capacity to remarry. 8

In support of her Petition, Genevieve submitted a copy of their Divorce

Certificate,9 Tetsushi's Family Register,10 the Certificate of Acceptance of the Notification
of Divorce,11 and an English translation of the Civil Code of Japan, 12 among others.13

After finding the Petition sufficient in form and substance, the Regional Trial Court set
the case for hearing on October 16, 2012.14
On the day of the hearing, no one appeared to oppose the Petition. After the
jurisdictional requirements were established and marked, trial on the merits ensued. 15

On February 14, 2014, the Regional Trial Court rendered a Judgment 16 denying
Genevieve's Petition. It decreed that while the pieces of evidence presented by
Genevieve proved that their divorce agreement was accepted by the local government
of Japan,17 she nevertheless failed to prove the copy of Japan's law. 18

The Regional Trial Court noted that the copy of the Civil Code of Japan and its English
translation submitted by Genevieve were not duly authenticated by the Philippine
Consul in Japan, the Japanese Consul in Manila, or the Department of Foreign Affairs. 19

Aggrieved, Genevieve filed a Motion for Reconsideration, but it was denied in the
Regional Trial Court's June 11, 2014 Resolution. 20

Thus, Genevieve filed before this Court the present Petition for Review on Certiorari. 21

Petitioner argues that the trial court erred in not treating the English translation of the
Civil Code of Japan as an official publication in accordance with Rule 131, Section 3(gg)
of the Rules of Court. That it is an official publication, she points out, makes it a self-
authenticating evidence of Japan's law under Rule 132, Section 25 of the Rules of
Court.22

Petitioner further contends that the trial court erred in not considering the English
translation of the Japan Civil Code as a learned treatise and in refusing to take judicial
notice of its authors' credentials.23

In its August 13, 2014 Resolution,24 this Court required respondents to file their
comment.

In their Comment,25 respondents, through the Office of the Solicitor General, maintain

that the Regional Trial Court was correct in denying the petition for petitioner's failure
to prove respondent Tetsushi's national law. 26 They stress that in proving a foreign
country's law, one must comply with the requirements under Rule 132, Sections 24 and
25 of the Rules of Court.27

Respondents similarly claim that what Rule 131, Section 3(gg) of the Rules of Court
presumes is "the fact of printing and publication[,]" 28 not that it was an official
publication by the government of Japan.29

Finally, respondents insist that before the English translation of the Japan Civil Code
may be considered as a learned treatise, the trial court must first take judicial notice
that the writer is recognized in his or her profession as an expert in the subject. 30

In its March 25, 2015 Resolution,31 this Court directed petitioner to file her reply.

In her Reply,32 petitioner asserts that she submitted in evidence the Civil Code of Japan
as an official publication printed "under authorization of the Ministry of Justice[.]" 33 She
contends that because it was printed by a public authority, the Civil Code of Japan is
deemed to be an official publication under Rule 131, Section 3(gg) of the Rules of Court
and, therefore, is a self-authenticating document that need not be certified under Rule
132, Section 24.34

In its August 3, 2016 Resolution, 35 this Court resolved to dispense with the filing of
respondent Tetsushi's Comment. In addition, the parties were required to file their
respective memoranda.

In her Memorandum,36 petitioner reiterates that the Regional Trial Court erred in not
considering the Civil Code of Japan as an official publication and its English translation
as a learned treatise.37

On September 23, 2016, respondents manifested that they are adopting their Comment
as their memorandum.38

The issue for this Court's resolution is whether or not the Regional Trial Court erred in
denying the petition for judicial recognition of foreign divorce and declaration of
capacity to remarry filed by petitioner Genevieve Rosal Arreza a.k.a. Genevieve Arreza
Toyo.

When a Filipino and an alien get married, and the alien spouse later acquires a valid
divorce abroad, the Filipino spouse shall have the capacity to remarry provided that the
divorce obtained by the foreign spouse enables him or her to remarry. Article 26 of the
Family Code, as amended,39 provides: cralawred

ARTICLE 26. All marriages solemnized outside the Philippines in accordance with the
laws in force in the country where they were solemnized, and valid there as such, shall
also be valid in this country, except those prohibited under Articles 35 (1), (4), (5) and
(6), 36, 37 and 38.

Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a
divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her
to remarry, the Filipino spouse shall have capacity to remarry under Philippine
law. (Emphasis supplied)

The second paragraph was introduced as a corrective measure to resolve an absurd

situation where the Filipino spouse remains married to the alien spouse even after their
marital bond had been severed by the divorce decree obtained abroad. 40 Through this
provision, Philippine courts are given the authority "to extend the effect of a foreign
divorce decree to a Filipino spouse without undergoing trial to determine the validity of
the dissolution of the marriage."41 It bestowed upon the Filipino spouse a substantive
right to have his or her marriage considered dissolved, granting him or her the capacity
to remarry.42

Nonetheless, settled is the rule that in actions involving the recognition of a foreign
divorce judgment, it is indispensable that the petitioner prove not only the foreign
judgment granting the divorce, but also the alien spouse's national law. This rule is
rooted in the fundamental theory that Philippine courts do not take judicial notice of
foreign judgments and laws. As explained in Corpuz v. Sto. Tomas:43
The starting point in any recognition of a foreign divorce judgment is the
acknowledgment that our courts do not take judicial notice of foreign judgments and
laws. Justice Herrera explained that, as a rule, "no sovereign is bound to give effect
within its dominion to a judgment rendered by a tribunal of another country." This
means that the foreign judgment and its authenticity must be proven as facts under our
rules on evidence, together with the alien's applicable national law to show the effect of
the judgment on the alien himself or herself. The recognition may be made in an action
instituted specifically for the purpose or in another action where a party invokes the
foreign decree as an integral aspect of his [or her] claim or defense. 44 (Citations
omitted)

Both the foreign divorce decree and the foreign spouse's national law, purported to be
official acts of a sovereign authority, can be established by complying with the mandate
of Rule 132, Sections 2445 and 2546 of the Rules of Court: cralawred

Under Sections 24 and 25 of Rule 132, on the other hand, a writing or document may
be proven as a public or official record of a foreign country by either (1) an official
publication or (2) a copy thereof attested by the officer having legal custody of the
document. If the record is not kept in the Philippines, such copy must be (a)
accompanied by a certificate issued by the proper diplomatic or consular officer in the
Philippine foreign service stationed in the foreign country in which the record is kept
and (b) authenticated by the seal of his office.47 (Citations omitted)

Here, the Regional Trial Court ruled that the documents petitioner submitted to prove
the divorce decree have complied with the demands of Rule 132, Sections 24 and
25.48 However, it found the copy of the Japan Civil Code and its English translation
insufficient to prove Japan's law on divorce. It noted that these documents were not
duly authenticated by the Philippine Consul in Japan, the Japanese Consul in Manila, or
the Department of Foreign Affairs.49

Notwithstanding, petitioner argues that the English translation of the Japan Civil Code is
an official publication having been published under the authorization of the Ministry of
Justice50 and, therefore, is considered a self-authenticating document. 51

Petitioner is mistaken.

In Patula v. People,52 this Court explained the nature of a self-authenticating

document: cralawred

The nature of documents as either public or private determines how the documents
may be presented as evidence in court. A public document, by virtue of its official or
sovereign character, or because it has been acknowledged before a notary public
(except a notarial will) or a competent public official with the formalities required by
law, or because it is a public record of a private writing authorized by law, is self
authenticating and requires no further authentication in order to be presented as
evidence in court. In contrast, a private document is any other writing, deed, or
instrument executed by a private person without the intervention of a notary or other
person legally authorized by which some disposition or agreement is proved or set
forth. Lacking the official or sovereign character of a public document, or the
solemnities prescribed by law, a private document requires authentication in the
manner allowed by law or the Rules of Court before its acceptance as evidence in court.
The requirement of authentication of a private document is excused only in four
instances, specifically: (a) when the document is an ancient one within the context of
Section 21, Rule 132 of the Rules of Court; (b) when the genuineness and authenticity
of an actionable document have not been specifically denied under oath by the adverse
party; (c) when the genuineness and authenticity of the document have been admitted;
or (d) when the document is not being offered as genuine. 53 (Emphasis supplied,
citations omitted)

The English translation submitted by petitioner was published by Eibun-Horei-Sha,

Inc.,54 a private company in Japan engaged in publishing English translation of
Japanese laws, which came to be known as the EHS Law Bulletin Series. 55 However,
these translations are "not advertised as a source of official translations of Japanese
laws;"56 rather, it is in the KANPO or the Official Gazette where all official laws and
regulations are published, albeit in Japanese.57

Accordingly, the English translation submitted by petitioner is not an official publication

exempted from the requirement of authentication.

Neither can the English translation be considered as a learned treatise. Under the Rules
of Court, "[a] witness can testify only to those facts which he knows of his [or her]
personal knowledge[.]"58 The evidence is hearsay when it is "not . . . what the witness
knows himself [or herself] but of what he [or she] has heard from others." 59 The rule
excluding hearsay evidence is not limited to oral testimony or statements, but also
covers written statements.60

The rule is that hearsay evidence "is devoid of probative value[.]" 61 However, a
published treatise may be admitted as tending to prove the truth of its content if: (1)
the court takes judicial notice; or (2) an expert witness testifies that the writer is
recognized in his or her profession as an expert in the subject. 62

Here, the Regional Trial Court did not take judicial notice of the translator's and
advisors' qualifications. Nor was an expert witness presented to testify on this matter.
The only evidence of the translator's and advisors' credentials is the inside cover page
of the English translation of the Civil Code of Japan. 63 Hence, the Regional Trial Court
was correct in not considering the English translation as a learned treatise.

Finally, settled is the rule that, generally, this Court only entertains questions of law in
a Rule 45 petition. 64 Questions of fact, like the existence of Japan's law on divorce, 65 are
not within this Court's ambit to resolve.66

Nonetheless, in Medina v. Koike,67 this Court ruled that while the Petition raised
questions of fact, "substantial ends of justice warrant that the case be referred to the
[Court of Appeals] for further appropriate proceedings": cralawred

Considering that the validity of the divorce decree between Doreen and Michiyuki, as
well as the existence of pertinent laws of Japan on the matter are essentially factual
that calls for a re-evaluation of the evidence presented before the RTC, the issue raised
in the instant appeal is obviously a question of fact that is beyond the ambit of a Rule
45 petition for review.
....

Nonetheless, despite the procedural restrictions on Rule 45 appeals as above-adverted,

the Court may refer the case to the [Court of Appeals] under paragraph 2, Section 6 of
Rule 56 of the Rules of Court, which provides: cralawred

SEC. 6. Disposition of improper appeal. — ...

An appeal by certiorari taken to the Supreme Court from the Regional Trial Court
submitting issues of fact may be referred to the Court of Appeals for decision or
appropriate action. The determination of the Supreme Court on whether or not issues of
fact are involved shall be final.

This, notwithstanding the express provision under Section 5 (f) thereof that an appeal
likewise "may" be dismissed when there is error in the choice or mode of appeal.

Since the said Rules denote discretion on the part of the Court to either dismiss the
appeal or refer the case to the [Court of Appeals], the question of fact involved in the
instant appeal and substantial ends of justice warrant that the case be referred to the
[Court of Appeals] for further appropriate proceedings. It bears to stress that
procedural rules were intended to ensure proper administration of law and justice. The
rules of procedure ought not to be applied in a very rigid, technical sense, for they are
adopted to help secure, not override, substantial justice. A deviation from its rigid
enforcement may thus be allowed to attain its prime objective, for after all, the
dispensation of justice is the core reason for the existence of the courts. 68 (Citations
omitted)

WHEREFORE, in the interest of orderly procedure and substantial justice, the case is
hereby REFERRED to the Court of Appeals for appropriate action, including the
reception of evidence, to DETERMINE and RESOLVE the pertinent factual issues in
accordance with this Decision.

SO ORDERED.

2. ELSA DEGAYO, vs.

CECILIA MAGBANUA-DINGLASAN, JOHNNY DINGLASAN, ASUNCION
MAGBANUA-PORRAS, MARIANO P ASCUALITO and AMADO JR., all
surnamed MAGBANUA, G.R. Nos. 173148, April 6, 2015

 D E C I S I O N
BRION, J.:

Before us is the Petition for Review on Certiorari filed by the petitioner Elsa Degayo (Degayo) under
Rule 45 of the Rules of Court, assailing the Decision  dated November 7, 2005 and the
1

Resolution  dated May 19, 2006 of the Court of Appeals (CA) in CA-G.R. CV No. 62070.
2

The Factual Antecedents

The present case involves a property dispute, which gave rise to two civil cases for ownership and
damages between conflicting claimants over a parcel of land located on the northeastern bank of
Jalaud River. The respondents Cecilia Magbanua-Dinglasan, Johnny Dinglasan, Pascualito
Magbanua, Mariano Magbanua, Asuncion Magbanua-Porras, Amado Magbanua Jr. (respondents)
initiated the first civil case against Nicolas Jarencio, Cesar Jarencio, Myrna Olmo, Fredercio
Sumvilla, Herminio Sumvilla, Perpetuo Larano and Angelo Larano, the tenants (tenants) of Lot No.
861. Degayo, on the other hand, initiated the second civil case, which eventually reached this Court
via the present petition.

Records show that Lot No. 861 isa 36,864 sqm. parcel in the Cadastral Survey of Dingle, Iloilo,
covered by Transfer Certificate of Title (TCT) No. T-2804, registered in the name of Degayo’s
deceased parents, spouses Marcelo Olmo and Rosalia Labana. Lot No. 861 used to be bounded on
the southwest by the Jalaud River that serves to separate Dingle from Pototan Iloilo.

On the other side of Jalaud River, opposite Lot No. 861, lies a 153,028 square meter parcel of land,
designated as Lot No. 7328 of the Cadastre of Pototan, Iloilo, collectively owned by the respondents,
covered under TCT No. T-84829. The Jalaud River, which separates these parcels of land, thus
flows along the northeast side of Lot 861 and the southwest side of Lot No. 7328. Sometime in the
1970’s the Jalauad River steadily changed its course and moved southwards towards the banks of
Pototan, where Lot No. 7328 lies, leaving its old riverbed dry. Eventually, the course of the Jalaud
River encroached on Lot No. 7328. As a result, Lot No. 7328 progressively decreased in size while
the banks adjacent to Lot No. 861 gradually increased in land area.

Degayo and the tenants believed that the area was an accretion to Lot No. 861. As a result, her
tenants, commenced cultivating and tilling that disputed area with corn and tobacco. The area
allegedly added to Lot No. 861 contains 52,528 sqm, broken down as follows:

1. 26,106 sqm. Original abandoned river bed;

2. 26,419 sqm. resurfaced area of Lot No. 7328

The respondents, on the other hand, argued that the disputed property was an abandoned riverbed,
which should rightfully belong to them to compensate for the erstwhile portion of Lot No. 7328, over
which the Jalaud River presently runs.

On October 2, 1984, the respondents filed a complaint for ownership and damages against the
tenants, with the Regional Trial Court (RTC) of Iloilo, Branch 27, entitled Cecilia Magbanua
Dinglasan, et al. v. Nicolas Jarencio, et al., docketed as Civil Case No. 16047. Degayo sought to
intervene in Civil Case No. 16047 but her motion was denied. Notably, Degayo never bothered to
question the interlocutory order denying her motion for intervention by filing a petition for certiorari.
Instead, Degayo initiated the present suit against the respondents for declaration of ownership with
damages, also with the RTC of Iloilo, Branch 22, docketed as Civil Case No. 18328, involving the
disputed parcel of land.
In her complaint, Degayo alleged to have acquired Lot No. 861 by inheritance by virtue of a
Quitclaim Deed and that she had been in possession of that land since 1954. She likewise stressed
that the area in dispute was an accretion to Lot No. 861.

Meanwhile, notwithstanding the previous denial of her motion to intervene in Civil Case No. 16047,
Degayo was able to participate in the proceedings therein as a witness for the defense. In particular,
during her direct examination, Degayo testified on the same matters and raised the same arguments
she alleged in her complaint in Civil Case No. 18328, those are: that she acquired Lot No. 861 by
inheritance by virtue of a Quitclaim Deed; that she had been in possession of that land since 1954;
and that the area in dispute was an accretion to Lot No. 861 On May 7, 1996, the RTC of Iloilo,
Branch 27, rendered its decision in Civil Case No. 16047, in favor of the respondents. The tenants
promptly filed an appeal but they failed to file an appeal brief, resulting to a dismissal of their appeal
per resolution dated June 20, 1999.  The decision in Civil Case No. 16047 became final and
3

executory on August 6, 1999. 4

Meanwhile, in Civil Case No. 18328, the court, a quo, found in favor of Degayo and declared the
property in question as an accretion to Lot No. 861. The respondents filed a motion for
reconsideration but their motion was denied. Hence, the respondents filed an appeal with the CA.

The CA Ruling

On November 7, 2005, the CA granted the respondents’ appeal and reversed and set aside the
decision of the RTC Branch 22 in Civil Case No. 18328. In granting the appeal the CA noted that the
disputed properties are abandoned riverbeds. Being abandoned riverbeds, the property in question
rightfully belongs to the respondents as the owners of the land now occupied by the Jalaud
River.  The CA likewise noted that the previous RTC Branch decision in Civil Case No. 16047 is
5

conclusive to the title of the thing, being an aspect of the rule on conclusiveness of judgment. 6

Degayo sought a reconsideration of the CA Decision but the CA denied her motion in its May 19,
2006 Resolution.  Aggrieved, Degayo filed the preset petition for review on certiorari under Rule 45
7

with this Court.

The Petition and Comment

Degayo’s petition is based on the following grounds/arguments: 8

1. That the CA erred in declaring the disputed property as an abandoned riverbed and not an
accretion to Lot 861;

2. The CA erred in taking judicial notice of the RTC decision in Civil Case No. 16047, which
was not even presented during the hearing of the present case;

3. The CA erred in declaring the RTC Branch 27 decision in Civil Case No. 16047 conclusive
upon Degayo when she was not even a party in the said Civil Case.

In his Comment,  the respondents assert that the petition raised questions of fact which are not
9

proper issues to be raised in a petition for review on certiorari.  They also claim that the essential
10

requisites of accretion are not present.  Finally, the respondents claim that the decision in Civil Case
11

No. 16047 constitutes res judicata. 12

THE COURT'S RULING

We deny the petition for lack of merit.

The Decision in Civil Case No. 16047 constitutes res judicata.

Res judicataliterally means "a matter adjudged; a thing judicially acted upon or decided; a thing or
matter settled by judgment." It also refers to the "rule that a final judgment or decree on the merits by
a court of competent jurisdiction is conclusive of the rights of the parties or their privies in all later
suits on points and matters determined in the former suit.  It rests on the principle that parties should
13

not to be permitted to litigate the same issue more than once; that, when a right or fact has been
judicially tried and determined by a court of competent jurisdiction, or an opportunity for such trial
has been given, the judgment of the court, so long as it remains unreversed, should be conclusive
upon the parties and those in privity with them in law or estate.14

This judicially created doctrine exists as an obvious rule of reason, justice, fairness, expediency,
practical necessity, and public tranquillity.  Moreover, public policy, judicial orderliness, economy of
15

judicial time, and the interest of litigants, as well as the peace and order of society, all require that
stability should be accorded judgments, that controversies once decided on their merits shall remain
in repose, that inconsistent judicial decision shall not be made on the same set of facts, and that
there be an end to litigation which, without the doctrine of res judicata, would be endless. 16

This principle cannot be overemphasized in light of our clogged dockets. As this Court has aptly
observed in Salud v. Court of Appeals: 17

"The interest of the judicial system in preventing relitigation of the same dispute recognizes that
judicialresources are finite and the number of cases that can be heard by the court is limited. Every
dispute that is reheard means that another will be delayed. In modern times when court dockets are
filled to overflowing, this concern is of critical importance. Res judicata thus conserves scarce judicial
resources and promotes efficiency in the interest of the public at large. Once a final judgment has
been rendered, the prevailing party also has an interest in the stability of that judgment. Parties
come to the courts in order to resolve controversies; a judgment would be of little use in resolving
disputes if the parties were free to ignore it and to litigate the same claims again and again. Although
judicial determinations are not infallible, judicial error should be corrected through appeals
procedures, not through repeated suits on the same claim. Further, to allow relitigation creates the
risk of inconsistent results and presents the embarrassing problem of determining which of two
conflicting decisions is to be preferred. Since there is no reason to suppose that the second or third
determination of a claim necessarily is more accurate than the first, the first should be left
undisturbed.

In some cases the public at large also has an interest in seeing that rights and liabilities once
established remain fixed. If a court quiets title to land, for example, everyone should be able to rely
on the finality of that determination. Otherwise, many business transactions would be clouded by
uncertainty. Thus, the most important purpose of res judicata is to provide repose for both the party
litigants and the public. As the Supreme Court has observed, "res judicata thus encourages reliance
on judicial decision, bars vexatious litigation, and frees the courts to resolve other disputes."

The doctrine of res judicata is set forth in Section 47 of Rule 39 of the Rules of Court, which in its
relevant part reads:

Sec. 47. Effect of judgments or final orders. — The effect of a judgment or final order rendered by a
court of the Philippines, having jurisdiction to pronounce the judgment or final order, may be as
follows:
 xxxx

(b) In other cases, the judgment or final order is, with respect to the matter directly adjudged
or as to any other matter that could have been raised in relation thereto, conclusive between
the parties and their successors in interest by title subsequent to the commencement of the
action or special proceeding, litigating for the same thing and under the same title and in the
same capacity; and

(c) In any other litigation between the same parties or their successors in interest, that only is
deemed to have been adjudged in a former judgment or final order which appears upon its
face to have been so adjudged, or which was actually and necessarily included therein or
necessary thereto.

This provision comprehends two distinct concepts of res judicata: (1) bar by former judgment and (2)
conclusiveness of judgment.

The first aspect is the effect of a judgment as a bar to the prosecution of a second action upon the
same claim, demand or cause of action.  In traditional terminology, this aspect is known as merger
18

or bar; in modern terminology, it is called claim preclusion.19

The second aspect precludes the relitigation of a particular fact of issue in another action between
the same parties on a different claim or cause of action. This is traditionally known as collateral
estoppel; in modern terminology, it is called issue preclusion. 20

Conclusiveness of judgment finds application when a fact or question has been squarely put in
issue, judicially passed upon, and adjudged in a former suit by a court of competent jurisdiction. The
fact or question settled by final judgment or order binds the parties to that action (and persons in
privity with them or their successors-in-interest), and continues to bind them while the judgment or
order remains standing and unreversed by proper authority on a timely motion or petition; the
conclusively settled fact or question furthermore cannot again be litigated in any future or other
action between the same parties or their privies and successors-in-interest, in the same or in any
other court of concurrent jurisdiction, either for the same or for a different cause of action.  Thus,
21

only the identities of parties and issues are required for the operation of the principle of
conclusiveness of judgment. 22

While conclusiveness of judgment does not have the same barring effect as that of a bar by former
judgment that proscribes subsequent actions, the former nonetheless estops the parties from raising
in a later case the issues or points that were raised and controverted, and were determinative of the
ruling in the earlier case.  In other words, the dictum laid down in the earlier final judgment or order
23

becomes conclusive and continues to be binding between the same parties, their privies and
successors-in-interest, as long as the facts on which that judgment was predicated continue to be
the facts of the case or incident before the court in a later case; the binding effect and enforceability
of that earlier dictum can no longer be re-litigated in a later case since the issue has already been
resolved and finally laid to rest in the earlier case.
24

In the present case, it is beyond dispute that the judgment in Civil Case No. 16047 has attained
finality in view of the tenant’s abandonment of their appeal to the CA. Moreover, records show that
that decision was adjudicated on the merits, i.e., it was rendered after a consideration of the
evidence or stipulations submitted by the parties at the trial of the case  by a court which had
25

jurisdiction over the subject matter and the parties.

We likewise find that there is an identity of parties in Civil Case No. 16047 and the present case.
There is identity of parties where the parties in both actions are the same, or there is privity between
them, or they are "successors-in-interest by title subsequent to the commencement of the action,
litigating for the same thing and under the same title and in the same capacity.  Absolute identity of
26

parties is not required, shared identity of interest is sufficient to invoke the coverage of this
principle.  Thus, it is enough that there is a community of interest between a party in the first case
27

and a party in the second case even if the latter was not impleaded in the first case. 28

It is not disputed that respondents were the plaintiffs in Civil Case No. 16047. Degayo, however
insists that she is not bound by the decision in Civil Case No. 16047 as she was not made a party in
that case. We, however, refuse to subscribe to this technical interpretation of the Rules. In Torres v.
Caluag,  we held that a real litigant may be held bound as a party even if not formally impleaded
29

because he had his day in court and because her substantial rights were not prejudiced. In that
case, J. M. Tuazon & Co., Inc. (Tuason) commenced Civil Case No Q-3674 in the Court of First
Instance of Quezon City against Isidro Conisido to recover from him the possession of a parcel of
land. Conisido answered the complaint alleging, that he was occupying the land in question as a
mere tenant of Dominga Torres (Torres), who owned both the land and the house thereon. Torres
was not impleaded in the said case but she nonetheless appeared as witness for Conisido and
asserted her ownership over the disputed property because she had purchased it from Eustaquio
Alquiroz on October 20, 1951 and constructed a house thereon worth ₱500.00, which she had
leased to Conisido for a rental of ₱20.00 a month. The CFI eventually decided in favor of Tuason
and that decision became final and executory. Subsequently, Torres filed a petition for certiorari with
the Court to set aside the decision of the CFI. Indismissing the petition, we ruled:

"x x x, it appears that DomingaTorres who, according to the defendant Conisido was the true owner
ofthe land in question, testified as his witness and asserted on the witness stand that she was really
the owner thereof because she had purchased it from Eustaquio Alquiroz on October 20, 1951 and
constructed a house thereon worth ₱500.00 which she had leased to Conisido for a rental of ₱20.00
a month. In other words, petitioner herein had really had her day in court and had laid squarely
before the latter the issue of ownership as between her, on one hand, and respondent Tuason, on
the other.

xxx

In the present case, assisted heretofore, petitioner had the fullest opportunity to lay before the court
her claim but the same was overruled. The fact that she was not formally made a party defendant in
the case would appear therefore to be a mere technicality that would not serve the interest of the
administration of justice. As we have repeatedly held, technicalities should be ignored when they do
not serve the purpose of the law.

x x x"

In the present case, Degayo had the fullest opportunity to ventilate her accretion claim Civil Case
No. 16047. In her testimony, she asserted that she inherited Lot No. 861 from her parents and that
she has been in possession of that parcel of land since 1954.  She further stressed that the disputed
30

parcel of land has been occupied and tilled by her tenants and that it was the result of the gradual
and continuous deposit of the river.  Notably, these are the same allegations that Degayo asserted
31

in the present case, which have been previously considered and evaluated by the RTC Branch 27 in
Civil Case No. 16047.

Likewise, there exists a community of interest between Degayo and her tenants, who were
respondents in Civil Case No. 16047. One test to determine substantial identity of interest would be
to see whether the success or failure of one party materially affects the other.  In the present case,
32

Degayo is suing for the ownership of the disputed land. Degayo’s rights over the disputed land is
predicated on the same defenses that his alleged tenants interposed in Civil Case No. 16047, that is,
their perceived rights which emanated from the disputed accretion to Lot No. 861. The interests of
Degayo and the tenants in relation to the two cases are inextricably intertwined in that both their
claims emanate from a singular fundamental allegation of accretion. Moreover, Degayo and the
respondents are litigating the same properties subject of the antecedent cases inasmuch as they
claim better right of ownership. Degayo even admitted this in her petition wherein she stated that
"the land subject of Civil Case No. 16047 is the same property subject of the case at bench.  " 33

Notably, the ownership of the disputed parcel of land has been unequivocally settled in Civil Case
No. 16047.In ruling that the subject parcels of land belong to the respondents, the RTC Branch 27 in
Civil Case No. 16047 opined that the claim of accretion has no valid basis.  What really happened
34

was that the Jalaud River naturally changed its course and moved southward. As a result, it
abandoned its previous bed and encroached upon a portion of Lot No. 7328. It further held that the
claim of accretion could not be sustained because the 26,419 sqm. portion is ostensibly within the
metes and bounds of Lot No. 7328, owned and registered in the name of the respondents.  On the 35

other hand, the 26,106 sqm. portion refers to an abandoned river bed, and is thus governed by
Article 461 of the Civil Code, which states that River beds which are abandoned through the natural
change in the course of the waters ipso facto belong to the owners whose lands are occupied by the
new course in proportion to the area lost.

The fact that the present cause of action is based on an accretion claim does not prevent the
application of res judicata. For, res judicata, under the concept of conclusiveness of judgment,
operates even if no absolute identity of causes of action exists. Res judicata, in its conclusiveness of
judgment concept, merely requires identity of issues. We thus agree with the uniform view of the CA
– on the application of conclusiveness of judgment to the present case. The CA may take judicial
notice of

Civil Case No. 16047.

The taking of judicial notice is a matter of expediency and convenience for it fulfills the purpose that
the evidence is intended to achieve, and in this sense, it is equivalent to proof.  Generally, courts are
36

not authorized to "take judicial notice of the contents of the records of other cases even when said
cases have been tried or are pending in the same court or before the same judge.  " While the
37

principle invoked is considered to be the general rule, this rule is not absolute. There are exceptions
to this rule. In the case of Tiburcio v PHHC,  this Court, citing Justice Moran, stated:
38

"In some instance, courts have taken judicial notice of proceedings in other causes, because of their
close connection with the matter in the controversy. Thus, in a separate civil action against the
administrator of an estate arising from an appeal against the report of the committee on claims
appointed in the administration proceedings of the said estate, to determine whether or not the
appeal was taken on time, the court took judicial notice of the record of the administration
proceedings. Courts have also taken judicial notice of previous cases to determine whether or not
the case pending is a moot one or whether or not a previous ruling is applicable in the case under
consideration."

Moreover, Degayo’s objection to the action of CA on this matter is merely technical because Degayo
herself repeatedly referred to the Civil Case No. 16047 in her pleadings in Civil Case No. 18328and
even in her appellee’s brief before the CA and her petition for review before this Court. In particular,
in her complaint, she stated that her motion to intervene in Civil Case No. 16047, which was denied
by the Court.  The existence of that case was likewise jointly stipulated by that parties in Civil Case
39
No. 18328  and mentioned by the court a quoin its decision.  In her appellee’s brief as well, Degayo
40 41

expressly referred to Civil Case No. 16047. In particular, she stated:

"The said Civil Case No. 16047 was for recovery of ownership and possession with damages over
the property subject of the instant case filed by the herein defendants-appellants against [the
tenants]"

She also referred to the decision in Civil Case No. 16047 in her appellee’s brief. She mentioned: "In
Civil Case No. 16047, the Court had ordered the deposit of 50% of the net produce of the disputed
portion that pertains to the owner, thus depriving the plaintiff of her share of not less than Php
4,000.00 a year starting 1986, to the damage of plaintiff."

There was thus no denial of the existence and the decision in Civil Case No. 16047.  In fact, Degayo
1âwphi1

stated on record her full knowledge of Civil Case No. 16047 and clearly and frequently referred to it
in her pleadings, and sufficiently designated it by name, parties, cause of action and docket number
from the court a quo, to the CA and even before this Court. Under the circumstances, the CA could
certainly take judicial notice of the finality of a judgment in Civil Case No. 16047. There was no
sense in relitigating issues that have already been passed upon in a previous civil case. That was all
that was done by the CA in decreeing the dismissal. Certainly such an order is not contrary to law.
As we aptly stated in Republic v. CA,  citing Justice Edgardo L. Paras:
42

"A court will take judicial notice of its own acts and records in the same case, of facts established in
prior proceedings in the same case, of the authenticity of its own records of another case between
the same parties, of the files of related cases in the same court, and of public records on file in the
same court. In addition judicial notice will be taken of the record, pleadings or judgment of a case in
another court between the same parties or involving one of the same parties, as well as of the record
of another case between different parties in the same court. " Lastly, there is another equally
compelling consideration. Degayo undoubtedly had recourse to a remedy which under the law then
in force could be availed of, which is to file a petition for certiorari with the CA. It would have served
the cause of justice better, not to mention the avoidance of needless expense on her part and the
vexation to which the respondents were subjected if she did reflect a little more on the matter.

With the conclusion that Civil Case No. 16047 constitutes resjudicata on the present case, we see
no reason to engage in a discussion on the factual issues raised by the petitioner for they have been
passed upon and considered in Civil Case No. 16047.

WHEREFORE, premises considered, we DENY the petition for lack of merit. Costs against the
petitioner.

SO ORDERED.

ARTURO D. BRION
Associate Justice

3. SPOUSES OMAR and MOSHIERA LATIP, vs. ROSALIE PALAÑA CHUA, G.R.

No. 177809, October 16, 2009

 D E C I S I O N
NACHURA, J.:

Challenged in this petition for review on certiorari is the Court of Appeals (CA) Decision in CA-G.R.
SP No. 89300:1 (1) reversing the decision of the Regional Trial Court (RTC), Branch 274, Parañaque
City in Civil Case No. 04-0052; 2 and (2) reinstating and affirming in toto the decision of the
Metropolitan Trial Court (MeTC), Branch 78, of the same city in Civil Case No. 2001-315. 3

First, we sift through the varying facts found by the different lower courts.

The facts parleyed by the MeTC show that respondent Rosalie Chua (Rosalie) is the owner of
Roferxane Building, a commercial building, located at No. 158 Quirino Avenue corner Redemptorist
Road, Barangay Baclaran, Parañaque City.

On July 6, 2001, Rosalie filed a complaint for unlawful detainer plus damages against petitioners,
Spouses Omar and Moshiera Latip (Spouses Latip). Rosalie attached to the complaint a contract of
lease over two cubicles in Roferxane Bldg., signed by Rosalie, as lessor, and by Spouses Latip, as
lessees thereof.1 a vv p h ! 1

The contract of lease reads:

CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

This Contract of Lease is entered into by and between:

ROSALIE PALAÑA CHUA, Filipino, of legal age, married with office at 2/F JOFERXAN Building,
F.B. Harrison St., Brgy. Baclaran, Parañaque City, and hereinafter referred to as the LESSOR,

- and -

OMAR LATIEF marriage to MOSHIERA LATIEF, also both Filipino, of legal age with address at 24
Anahan St. RGV Homes Parañaque City, and hereinafter referred to as the LESSEES.

WITNESSETH

1. That the LESSOR is the owner of the commercial building erected at the lot of the Toribio G.
Reyes Realty, Inc. situated at 158 Quirino Ave. corner Redemptorist Road, Barangay Baclaran in
Parañaque Ctiy;

2. That LESSOR hereby leases two (2) cubicles located at the 1st & 2nd Floor, of said building with
an area of 56 square meters under the following terms and conditions, to wit:

a. That the monthly rental of the two (2) cubicles in PESOS, SIXTY THOUSAND
(₱60,000.00), Philippine Currency. However, due to unstable power of the peso
LESSEES agrees to a yearly increase of ten (10%) percent of the monthly rental;

b. That any rental in-arrears shall be paid before the expiration of the contract to the
LESSOR;
 c. That LESSEES agree to pay their own water and electric consumptions in the said
premises;

d. That the LESSEES shall not sub-let or make any alteration in the cubicles without
a written permission from the LESSOR. Provided, however, that at the termination of
the Contract, the lessee shall return the two cubicles in its original conditions at their
expenses;

e. That the LESSEES agree to keep the cubicles in a safe and sanitary conditions,
and shall not keep any kinds of flammable or combustible materials.

f. That in case the LESSEES fail to pay the monthly rental every time it falls due or
violate any of the above conditions shall be enough ground to terminate this Contract
of Lease. Provided, further, that, if the LESSEES pre-terminate this Contract they
shall pay the rentals for the unused month or period by way of liquidated damages in
favor of the LESSOR.

3. That this Contract of Lease is for six (6) yrs. only starting from December _____, 1999 or up to
December ______, 2005.

IN WITNESS WHEREOF, the parties have hereunto affixed their hands this ___th day of December,
1999 at City of Manila, Philippines.

(sgd.) (sgd.)
ROSALIE PALAÑA-CHUA MOSHIERA LATIEF
LESSOR LESSEE

(sgd.)
OMAR LATIEF
LESSEE

SIGNED IN THE PRESENCE OF:

(sgd.) (sgd.)
1. Daisy C. Ramos 2. Ferdinand C. Chua

Republic of the Philippines)

City of Manila)s.s.

ACKNOWLEDGMENT

BEFORE ME, a Notary Public for and in the City of Manila personally appeared the following
persons:

Rosalie P. Chua with CTC No. 05769706 at Parañaque City on 2/1/99; Moshiera Latief with CTC No.
12885654 at Parañaque City on 11/11/99; Omar Latief with CTC No. 12885653 Parañaque City on
Nov. 11, 1999.

known to me and to me known to be the same persons who executed this instrument consisting of
two (2) pages duly signed by them and the two (2) instrumental witnesses and acknowledged to me
that the same is their free and voluntarily acts and deeds.
IN FAITH AND TESTIMONY WHEREOF, I have hereunto affixed my hand and Notarial Seal this
____th day of December, 1999 at the City of Manila, Philippines.

Doc. No. _____ ATTY. CALIXTRO B. RAMOS

Page No. _____ NOTARY PUBLIC
Book No. LXV Until December 31, 2000
Series of 1999 PTR # 374145-1/11/99/-Mla.
IBP # 00262-Life Member4

A year after the commencement of the lease and with Spouses Latip already occupying the leased
cubicles, Rosalie, through counsel, sent the spouses a letter demanding payment of back rentals
and should they fail to do so, to vacate the leased cubicles. When Spouses Latip did not heed
Rosalie’s demand, she instituted the aforesaid complaint.

In their Answer, Spouses Latip refuted Rosalie’s claims. They averred that the lease of the two (2)
cubicles had already been paid in full as evidenced by receipts showing payment to Rosalie of the
total amount of ₱2,570,000.00. The three (3) receipts, in Rosalie’s handwriting, read:

1. I received the amount of ₱2,000,000.00 (two million pesos) from [O]mar Latip &
Moshi[e]ra Latip for the payment of 2 cubicles located at 158 Quirino Ave. corner
Redemptorist Rd.[,] Baclaran P[arañ]aque City. ROFERLAND 5 Bldg. with the terms 6
yrs. Contract.

₱2,000,000.00 (sgd.)
CHECK # 3767924 ____________________
FAR EAST BANK Rosalie Chua

(sgd.)
____________________
Ferdinand Chua

2. Received cash
₱500,000.00
From Moshiera Latip

(sgd.)
Rosalie Chua
12/10/99
____________________
Received by

3. Received cash
₱70,000.00 from
Moshiera Latip

(sgd.)
12-11-99 ____________________
Received by:6
Spouses Latip asseverated that sometime in October 1999, Rosalie offered for sale lease rights over
two (2) cubicles in Roferxane Bldg. Having in mind the brisk sale of goods during the Christmas
season, they readily accepted Rosalie’s offer to purchase lease rights in Roferxane Bldg., which was
still under construction at the time. According to Spouses Latip, the immediate payment of
₱2,570,000.00 would be used to finish construction of the building giving them first priority in the
occupation of the finished cubicles.

Thereafter, in December 1999, as soon as two (2) cubicles were finished, Spouses Latip occupied
them without waiting for the completion of five (5) other stalls. Spouses Latip averred that the
contract of lease they signed had been novated by their purchase of lease rights of the subject
cubicles. Thus, they were surprised to receive a demand letter from Rosalie’s counsel and the
subsequent filing of a complaint against them.

The MeTC ruled in favor of Rosalie, viz.:

WHEREFORE, premises considered, the [Spouses Latip] and all persons claiming rights under them
are hereby ordered to VACATE the property subject of this case located at the 1st and 2nd floors of
a Roferxane Building situated at No. 158 Quirino Avenue corner Redemptorist Road, Barangay
Baclaran, Parañaque City. The [Spouses Latip] are also ordered to PAY [Rosalie] the amount of
SEVEN HUNDRED TWENTY THOUSAND PESOS (₱720,000.00) as rent arrearages for the period
of December 1999 to December 2000 and thereafter to PAY [Rosalie] the amount of SEVENTY
TWO THOUSAND PESOS (₱72,000.00) per month from January 2001 to December 2002, plus ten
percent (10%) increase for each and every succeeding years thereafter as stipulated in paragraph
2(a) of the Contract of Lease x x x, until the [Spouses Latip] have completely vacated the leased
premises subject of this lease. Finally[,] the [Spouses Latip] are hereby ordered to PAY [Rosalie] the
amount of TWENTY THOUSAND PESOS (₱20,000.00) as attorney’s fees and TWO THOUSAND
PESOS (₱2,000.00) per [Rosalie’s] appearance in Court as appearance fee and to PAY the cost of
this suit.

[Spouses Latip’s] counterclaim is hereby DISMISSED for lack of merit.

SO ORDERED.7

In stark contrast, the RTC reversed the MeTC and ruled in favor of Spouses Latip. The RTC did not
give credence to the contract of lease, ruling that it was not notarized and, in all other substantial
aspects, incomplete. Further on this point, the RTC noted that the contract of lease lacked: (1) the
signature of Ferdinand Chua, Rosalie’s husband; (2) the signatures of Spouses Latip on the first
page thereof; (3) the specific dates for the term of the contract which only stated that the lease is for
"six (6) y[ea]rs only starting from December 1999 or up to December 2005"; (4) the exact date of
execution of the document, albeit the month of December and year 1999 are indicated therein; and
(5) the provision for payment of deposit or advance rental which is supposedly uncommon in big
commercial lease contracts.

The RTC believed the claim of Spouses Latip that the contract of lease was modified and
supplemented; and the entire lease rentals for the two (2) cubicles for six (6) years had already been
paid by Spouses Latip in the amount of ₱2,570,000.00. As to Rosalie’s claim that her receipt of
₱2,570,000.00 was simply goodwill payment by prospective lessees to their lessor, and not payment
for the purchase of lease rights, the RTC shot this down and pointed out that, apart from her bare
allegations, Rosalie did not adduce evidence to substantiate this claim. On the whole, the RTC
declared an existent lease between the parties for a period of six (6) years, and already fully paid for
by Spouses Latip. Thus, Spouses Latip could not be ejected from the leased premises until
expiration of the lease period.
The RTC disposed of the appeal, viz.:

WHEREFORE, all the foregoing considered, the appealed decision of the [MeTC] dated January 13,
2004 is reversed as judgment is hereby rendered for the [Spouses Latip] and against [Rosalie],
ordering the latter to pay the former –

(1) the sum of PhP1,000,000.00 as moral damages;

(2) the sum of PhP500,000.00 as exemplary damages;

(3) the sum of PhP250,000.00 plus PhP3,000.00 per court appearance as and for attorney’s
fees; and

(4) costs of suit.

SO ORDERED.8

In yet another turn of events, the CA, as previously mentioned, reversed the RTC and reinstated the
decision of the MeTC. The CA ruled that the contract of lease, albeit lacking the signature of
Ferdinand and not notarized, remained a complete and valid contract. As the MeTC had, the CA
likewise found that the alleged defects in the contract of lease did not render the contract ineffective.
On the issue of whether the amount of ₱2,570,000.00 merely constituted payment of goodwill
money, the CA took judicial notice of this common practice in the area of Baclaran, especially
around the Redemptorist Church. According to the appellate court, this judicial notice was bolstered
by the Joint Sworn Declaration of the stallholders at Roferxane Bldg. that they all had paid goodwill
money to Rosalie prior to occupying the stalls thereat. Thus, ruling on Rosalie’s appeal, the CA
disposed of the case:

WHEREFORE, in view of the foregoing, the Petition for Review is hereby GRANTED. The assailed
decision of RTC Parañaque City Branch 274 dated September 24, 2004 is hereby REVERSED and
SET ASIDE, and the January 13, 2004 decision of the MeTC is REINSTATED and AFFIRMED en
toto.

SO ORDERED.9

Not surprisingly, Spouses Latip filed the present appeal.

The singular issue for our resolution is whether Spouses Latip should be ejected from the leased
cubicles.

As previously adverted to, the CA, in ruling for Rosalie and upholding the ejectment of Spouses
Latip, took judicial notice of the alleged practice of prospective lessees in the Baclaran area to pay
goodwill money to the lessor.

We disagree.

Sections 1 and 2 of Rule 129 of the Rules of Court declare when the taking of judicial notice is
mandatory or discretionary on the courts, thus:

SECTION 1. Judicial notice, when mandatory. – A court shall take judicial notice, without the
introduction of evidence, of the existence and territorial extent of states, their political history, forms
of government and symbols of nationality, the law of nations, the admiralty and maritime courts of
the world and their seals, the political constitution and history of the Philippines, the official acts of
the legislative, executive and judicial departments of the Philippines, the laws of nature, the measure
of time, and the geographical divisions.

SEC. 2. Judicial notice, when discretionary. – A court may take judicial notice of matters which are of
public knowledge, or are capable of unquestionable demonstration or ought to be known to judges
because of their judicial functions.

On this point, State Prosecutors v. Muro10 is instructive:

I. The doctrine of judicial notice rests on the wisdom and discretion of the courts. The power to take
judicial notice is to be exercised by courts with caution; care must be taken that the requisite
notoriety exists; and every reasonable doubt on the subject should be promptly resolved in the
negative.

Generally speaking, matters of judicial notice have three material requisites: (1) the matter must be
one of common and general knowledge; (2) it must be well and authoritatively settled and not
doubtful or uncertain; and (3) it must be known to be within the limits of the jurisdiction of the court.
The principal guide in determining what facts may be assumed to be judicially known is that of
notoriety. Hence, it can be said that judicial notice is limited to facts evidenced by public records and
facts of general notoriety.

To say that a court will take judicial notice of a fact is merely another way of saying that the usual
form of evidence will be dispensed with if knowledge of the fact can be otherwise acquired. This is
because the court assumes that the matter is so notorious that it will not be disputed. But judicial
notice is not judicial knowledge. The mere personal knowledge of the judge is not the judicial
knowledge of the court, and he is not authorized to make his individual knowledge of a fact, not
generally or professionally known, the basis of his action. Judicial cognizance is taken only of those
matters which are "commonly" known.

Things of "common knowledge," of which courts take judicial notice, may be matters coming to the
knowledge of men generally in the course of the ordinary experiences of life, or they may be matters
which are generally accepted by mankind as true and are capable of ready and unquestioned
demonstration. Thus, facts which are universally known, and which may be found in encyclopedias,
dictionaries or other publications, are judicially noticed, provided they are of such universal notoriety
and so generally understood that they may be regarded as forming part of the common knowledge
of every person.11

We reiterated the requisite of notoriety for the taking of judicial notice in the recent case of
Expertravel & Tours, Inc. v. Court of Appeals,12 which cited State Prosecutors:

Generally speaking, matters of judicial notice have three material requisites: (1) the matter must be
one of common and general knowledge; (2) it must be well and authoritatively settled and not
doubtful or uncertain; and (3) it must be known to be within the limits of the jurisdiction of the court.
The principal guide in determining what facts may be assumed to be judicially known is that of
notoriety. Hence, it can be said that judicial notice is limited to facts evidenced by public records and
facts of general notoriety. Moreover, a judicially noticed fact must be one not subject to a reasonable
dispute in that it is either: (1) generally known within the territorial jurisdiction of the trial court; or (2)
capable of accurate and ready determination by resorting to sources whose accuracy cannot
reasonably be questionable.
Things of "common knowledge," of which courts take judicial notice, may be matters coming to the
knowledge of men generally in the course of the ordinary experiences of life, or they may be matters
which are generally accepted by mankind as true and are capable of ready and unquestioned
demonstration. Thus, facts which are universally known, and which may be found in encyclopedias,
dictionaries or other publications, are judicially noticed, provided, they are such of universal notoriety
and so generally understood that they may be regarded as forming part of the common knowledge
of every person. As the common knowledge of man ranges far and wide, a wide variety of particular
facts have been judicially noticed as being matters of common knowledge. But a court cannot take
judicial notice of any fact which, in part, is dependent on the existence or non-existence of a fact of
which the court has no constructive knowledge. 1avvphi1

From the foregoing provisions of law and our holdings thereon, it is apparent that the matter which
the appellate court took judicial notice of does not meet the requisite of notoriety. To begin with, only
the CA took judicial notice of this supposed practice to pay goodwill money to the lessor in the
Baclaran area. Neither the MeTC nor the RTC, with the former even ruling in favor of Rosalie, found
that the practice was of "common knowledge" or notoriously known.

We note that the RTC specifically ruled that Rosalie, apart from her bare allegation, adduced no
evidence to prove her claim that the amount of ₱2,570,000.00 simply constituted the payment of
goodwill money. Subsequently, Rosalie attached an annex to her petition for review before the CA,
containing a joint declaration under oath by other stallholders in Roferxane Bldg. that they had paid
goodwill money to Rosalie as their lessor. On this score, we emphasize that the reason why our
rules on evidence provide for matters that need not be proved under Rule 129, specifically on judicial
notice, is to dispense with the taking of the usual form of evidence on a certain matter so notoriously
known, it will not be disputed by the parties.

However, in this case, the requisite of notoriety is belied by the necessity of attaching documentary
evidence, i.e., the Joint Affidavit of the stallholders, to Rosalie’s appeal before the CA. In short, the
alleged practice still had to be proven by Rosalie; contravening the title itself of Rule 129 of the
Rules of Court – What need not be proved.

Apparently, only that particular division of the CA had knowledge of the practice to pay goodwill
money in the Baclaran area. As was held in State Prosecutors, justices and judges alike ought to be
reminded that the power to take judicial notice must be exercised with caution and every reasonable
doubt on the subject should be ample reason for the claim of judicial notice to be promptly resolved
in the negative.

Ultimately, on the issue of whether Spouses Latip ought to be ejected from the leased cubicles, what
remains in evidence is the documentary evidence signed by both parties – the contract of lease and
the receipts evidencing payment of ₱2,570,000.00.

We need not be unduly detained by the issue of which documents were executed first or if there was
a novation of the contract of lease. As had been found by the RTC, the lease contract and the
receipts for the amount of ₱2,570,000.00 can be reconciled or harmonized. The RTC declared:

Definitely, the parties entered into a lease agreement over two (2) cubicles of the 1st and 2nd floors
of Roferxane (Roferland) Building, a commercial building located at 158 Quirino Avenue, corner
Redemptorist Road, Baclaran, Parañaque City and belonging to [Rosalie]. The lease agreement is
for a term of six (6) years commencing in December 1999 up to December 2005. This agreement
was embodied in a Contract of Lease x x x. The terms of this lease contract, however, are modified
or supplemented by another agreement between the parties executed and or entered into in or about
the time of execution of the lease contract, which exact date of execution of the latter is unclear. 13
We agree with the RTC’s holding only up to that point. There exists a lease agreement between the
parties as set forth in the contract of lease which is a complete document. It need not be signed by
Ferdinand Chua as he likewise did not sign the other two receipts for ₱500,000.00 and ₱70,000.00,
respectively, which contained only the signature of Rosalie. Besides, it is undisputed that Rosalie
owns and leases the stalls in Roferxane Bldg.; thus, doing away with the need for her husband’s
consent. The findings of the three lower courts concur on this fact.

The contract of lease has a period of six (6) years commencing in December 1999. This fact is again
buttressed by Spouses Latip’s admission that they occupied the property forthwith in December
1999, bearing in mind the brisk sales during the holiday season.

On the conflicting interpretations by the lower courts of the receipts amounting to ₱2,570,000.00, we
hold that the practice of payment of goodwill money in the Baclaran area is an inadequate subject of
judicial notice. Neither was Rosalie able to provide sufficient evidence that, apart from the belatedly
submitted Joint Affidavit of the stallholders of Roferxane Bldg., the said amount was simply for the
payment of goodwill money, and not payment for advance rentals by Spouses Latip.

In interpreting the evidence before us, we are guided by the Civil Code provisions on interpretation
of contracts, to wit:

Art. 1371. In order to judge the intention of the contracting parties, their contemporaneous and
subsequent acts shall be principally considered.

Art. 1372. However general the terms of a contract may be, they shall not be understood to
comprehend things that are distinct and cases that are different from those which the parties
intended to agree.

Art. 1373. If some stipulation of any contract should admit of several meanings, it shall be
understood as bearing that import which is most adequate to render it effectual.

The RTC was already on the right track when it declared that the receipts for ₱2,570,000.00
modified or supplemented the contract of lease. However, it made a quantum leap when it ruled that
the amount was payment for rentals of the two (2) cubicles for the entire six-year period. We cannot
subscribe to this finding. To obviate confusion and for clarity, the contents of the receipts, already set
forth above, are again reproduced:

1. I received the amount of ₱2,000,000.00 (two million pesos) from [O]mar Latip & Moshi[e]ra
Latip for the payment of 2 cubicles located at 158 Quirino Ave. corner Redemptorist Rd.[,]
Baclaran P[arañ]que City. ROFERLAND Bldg. with the terms 6 yrs. Contract.

₱2,000,000.00 (sgd.)
CHECK # 3767924 ____________________
FAR EAST BANK Rosalie Chua

(sgd.)
____________________
Ferdinand Chua
 2. Received cash
₱500,000.00
From Moshiera Latip

(sgd.)
Rosalie Chua
12/10/99
____________________
Received by

3. Received cash
₱70,000.00 from
Moshiera Latip

(sgd.)
12-11-99 ____________________
Received by:14

There is nothing on the receipts and on record that the payment and receipt of ₱2,570,000.00
referred to full payment of rentals for the whole period of the lease. All three receipts state Rosalie’s
receipt of cash in varying amounts. The first receipt for ₱2,000,000.00 did state payment for two (2)
cubicles, but this cannot mean full payment of rentals for the entire lease period when there are no
words to that effect. Further, two receipts were subsequently executed pointing to the obvious fact
that the ₱2,000,000.00 is not for full payment of rentals. Thus, since the contract of lease remained
operative, we find that Rosalie’s receipt of the monies should be considered as advanced rentals on
the leased cubicles. This conclusion is bolstered by the fact that Rosalie demanded payment of the
lease rentals only in 2000, a full year after the commencement of the lease.

Finally, we note that the lease ended in 2005. Consequently, Spouses Latip can be ejected from the
leased premises. They are liable to Rosalie for unpaid rentals on the lease of the two (2) cubicles in
accordance with the stipulations on rentals in the Contract of Lease. However, the amount of
₱2,570,000.00, covering advance rentals, must be deducted from this liability of Spouses Latip to
Rosalie.

WHEREFORE, premises considered, the petition is hereby GRANTED. The decision of the Court of
Appeals in CA-G.R. SP No. 89300 is REVERSED. The petitioners, spouses Omar and Moshiera
Latip, are liable to respondent Rosalie Chua for unpaid rentals minus the amount of ₱2,570,000.00
already received by her as advance rentals. No costs.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

4. PEOPLE OF THE PHILIPPINES vs. TOMAS TUNDAG, G.R. Nos. 135695-96,

October 12, 2000

 D E C I S I O N
QUISUMBING, J.:

For automatic review is the judgment of the Regional Trial Court of Mandaue City,
Branch 28, in Criminal Cases Nos. DU-6186 and DU-6203, finding appellant Tomas
Tundag guilty of two counts of incestuous rape and sentencing him to death twice. chanrob1es virtua1 1aw 1ibrary

On November 18, 1997, private complainant Mary Ann Tundag filed with the Mandaue
City Prosecutor’s Office two separate complaints for incestuous rape. The first
complaint, docketed as Criminal Case No. DU-6186, alleged: chanrob1es virtual 1aw library

That on or about the 5th day of September, 1997, in the City of Mandaue, Philippines,
and within the jurisdiction of this Honorable Court, the above-named accused, being the
father of complainant MARY ANN TUNDAG, who is a 13-year-old girl, with deliberate
intent, did then and there willfully, unlawfully and feloniously have sexual intercourse
with the said offended party against the latter’s will.

CONTRARY TO LAW. 1

The other, docketed as Criminal Case No. DU-6203, averred: chanrob1es virtual 1aw library

That on or about the 7th day of November, 1997, in the City of Mandaue, Philippines,
and within the jurisdiction of this Honorable Court, the above-named accused, being the
father of complainant MARY ANN TUNDAG, who is a 13-year-old girl, with deliberate
intent, did then and there wilfully, unlawfully and feloniously have sexual intercourse
with the said offended party against the latter’s will.

CONTRARY TO LAW. 2

Upon arraignment appellant, assisted by counsel de parte, pleaded "Not Guilty" to the
charges.

The two cases were consolidated and a joint trial ensued.

Appellant’s defense was bare denial. He claimed that private complainant had fabricated
the rape charges against him since he and his daughter, "had a quarrel when he
accordingly reprimanded her for going out whenever he was not at home." 3

Appellant did not present any witness to reinforce his testimony. On August 31, 1998,
the trial court rendered its decision, thus: chanrob1es virtual 1aw library

WHEREFORE, foregoing premises considered, Joint Judgment is hereby rendered, to

wit: chanrob1es virtual 1aw library

I. In Criminal Case No. DU-6186 —

a) Finding the herein accused TOMAS TUNDAG guilty beyond reasonable doubt for the
crime of rape, said accused is hereby sentenced to the penalty of death;
b) To indemnify the offended party Mary Ann Tundag the following amounts: chanrob1es virtual 1aw library

(1) P50,000.00 by reason of the commission of the offense of rape upon her; and

(2) Another P50,000.00 as moral and exemplary damages under Article 2219 in relation
to Articles 2217 and 2230 of the New Civil Code for the pain and moral shock suffered
by her and for the commission of the crime of rape with one qualifying aggravating
circumstance; and

c) To pay the costs.

II. In Criminal Case No. DU-6203 —

a) Finding the herein accused TOMAS TUNDAG guilty beyond reasonable doubt for the
crime of rape, said accused is hereby sentenced to the penalty of death;

b) To indemnify the offended party Mary Ann Tundag the following amounts: chanrob1es virtual 1aw library

(1) P50,000.00 by reason of the commission of the offense of rape upon her; and

(2) Another P50,000.00 as moral and exemplary damages under Article 2219 in relation
to Articles 2217 and 2230 of the New Civil Code for the pain and moral shock suffered
by her and for the commission of the crime of rape with one qualifying aggravating
circumstance; and

(3) To pay the costs.

SO ORDERED. 4

In its judgment, the court below gave credence to complainant’s version of what
accused did to her.

The evidence for the prosecution as adduced during the trial on the merits clearly
shows that private complainant Mary Ann Tundag is a 13 year old girl who does not
know how to read and write and has an IQ of 76% which is a very low general mental
ability and was living with her father, the herein accused, at Galaxy Compound,
Mandaue City.

x           x          x

That on September 5, 1997 at about 10:00 o’clock in the evening, she was in the house
together with her father. But before she went to sleep, her father was already lying
down on the mat while herself (sic) just lied down at his head side which was not
necessarily beside him. However, when she was already sleeping, she noticed that her
father who was already undressed was beside her and was embracing her. Then, he
undressed her which she resisted but her father used a knife and told her that he would
kill her if she shouts and after that, he inserted his penis into her vagina and told her
not to shout or tell anyone. In effect, his penis penetrated her genital, which made her
vagina bleed and was very painful.

That when the penis of her father was already inserted in her vagina, her father was all
the time asking by saying (sic): ‘Does it feel good?’ And at the same time, he was
laughing and further, told her that a woman who does not marry can never enter
heaven and he got angry with her when she contradicted his statement. chanrob1es virtua1 1aw 1ibrary

That while the penis of her father was inside her vagina and (he) was humping over
her, she felt intense pain that she cried and told him to pull it out but did not accede
and in fact, said: ‘Why will I pull it out when it feels so good(?)’

That after removing his penis from her vagina and after telling her that she could not
go to heaven if she did not get married, her father just stayed there and continued
smoking while she cried.

That in the evening of November 7, 1997, she was at home washing the dishes while
her father was just smoking and squatting. That after she finished washing the dishes,
she lied (sic) down to sleep when her father embraced her and since she does not like
what he did to her, she placed a stool between them but he just brushed it aside and
laid down with her and was able to take her womanhood again by using a very sharp
knife which he was holding and was pointing it at the right side of her neck which made
her afraid.

That in the early morning of the following day, she left her father’s place and went to
her neighbor by the name of Bebie Cabahug and told her what had happened to her,
who, in turn, advised her to report the matter to the police, which she did and
accompanied by the policemen, she went to the Southern Islands Hospital where she
was examined and after her medical examination, she was brought back by the police
and was investigated by them." 5

Appellant’s claim that the complainant’s charges were manufactured did not impress
the trial court, which found him twice guilty of rape. Now before us, appellant assails
his double conviction, simply contending that: 6

THE TRIAL COURT HAS COMMITTED AN ERROR IN NOT ABSOLVING THE ACCUSED-
APPELLANT OF THE CRIMES CHARGED IN THE INFORMATIONS DESPITE THE PRESENCE
OF REASONABLE DOUBT TO EXCULPATE HIM OF THE SAME.

Appellant flatly denies that the incidents complained of ever took place. He contends
that on September 5, 1997, he was working as a watch repairman near Gal’s Bakery in
Mandaue City Market and went home tired and sleepy at around 11:00 o’clock that
evening. On November 7, 1997, he claims he was at work. In his brief, he argues that
it was impossible for him to have raped his daughter because when the incidents
allegedly transpired, "he went to work and naturally, being exhausted and tired, it is
impossible for him to do such wrongdoings." 7

The Office of the Solicitor General disagrees with appellant and urges the Court to
affirm the trial court’s decision, with the recommendation that the award of damages
and indemnity ex delicto be modified to conform to prevailing jurisprudence.
Considering the gravity of the offense charged as a heinous crime and the irreversibility
of the penalty of death imposed in each of these cases before us, the Court leaves no
stone unturned in its review of the records, including the evidence presented by both
the prosecution and the defense. Conviction must rest on nothing less than a moral
certainty of guilt. 8 But here we find no room to disturb the trial court’s judgment
concerning appellant’s guilt, because his defense is utterly untenable. chanrob1es virtua1 1aw 1ibrary

Appellant’s defense of alibi and denial is negative and self-serving. It hardly counts as a
worthy and weighty ground for exculpation in a trial involving his freedom and his life.
Against the testimony of private complainant who testified on affirmative matters, 9
such defense is not only trite but pathetic. Denial is an inherently weak defense, which
becomes even weaker in the face of the positive identification by the victim of the
appellant as the violator of her honor. 10 Indeed, we find that private complainant was
unequivocal in charging appellant with ravishing her. The victim’s account of the rapes
complained of was straightforward, detailed, and consistent. 11 Her testimony never
wavered even after it had been explained to her that her father could be meted out the
death penalty if found guilty by the court. 12

In a prosecution for rape, the complainant’s credibility is the single most important
issue. 13 The determination of the credibility of witnesses is primarily the function of
the trial court. The rationale for this is that the trial court has the advantage of having
observed at first hand the demeanor of the witnesses on the stand and, therefore, is in
a better position to form an accurate impression and conclusion. 14 Absent any showing
that certain facts of value have clearly been overlooked, which if considered could affect
the result of the case, or that the trial court’s finding are clearly arbitrary, the
conclusions reached by the court of origin must be respected and the judgment
rendered affirmed. 15

Moreover, we note here that private complainant’s testimony is corroborated by

medical findings that lacerations were present in her hymen. The examination
conducted by Dr. Bessie Acebes upon the private complainant yielded the following
results: chanrob1es virtual 1aw library

Genitalia: grossly female

Pubic Hairs: scanty

Labia Majora: coaptated

Labia Minora: -do-

Fourchette: U-shaped

Vestibule: pinkish

Hymen: + old healed laceration at 3 and 9 o’clock position(s).

Orifice: admits 2 fingers with ease

Vagina: chanrob1es virtual 1aw library

Walls: pinkish

Ruganities: prominent

Uterus: small

Cervix: closed

Discharges: Mucoid, minimal

Smears: chanrob1es virtual 1aw library

Conclusions: sperm identification (-)

Gram staining of vaginal disc. 16

Dr. Acebes testified that her findings of healed hymenal lacerations in the complainant’s
private parts meant a history of sexual congress on her part. 17 According to her, the
lacerations may have been caused by the entry of an erect male organ into
complainant’s genitals. The examining physician likewise pointed out that previous
coitus may be inferred from complainant’s U-shaped fourchette since the fourchette of a
female who has not yet experienced sexual intercourse is V-shaped. 18 While Dr.
Acebes conceded under cross-examination, that the existence of the datum "U-
shape(d) fourchette does not conclusively and absolutely mean that there was sexual
intercourse or contact because it can be caused by masturbation of fingers or other
things," 19 nonetheless, the presence of the hymenal lacerations tends to support
private complainant’s claim that she was raped by Appellant.

Appellant next contends that his daughter pressed the rape charges against him
because she had quarreled with him after he had castigated her for misbehavior. He
stresses that the prosecution did not rebut his testimony regarding his quarrel or
misunderstanding with private complainant. He urges us to consider the charges filed
against him as the result of his frequent castigation of her delinquent behavior. 20

Such allegation of a family feud, however, does not explain the charges away. Filing a
case for incestuous rape is of such a nature that a daughter’s accusation must be taken
seriously. It goes against human experience that a girl would fabricate a story which
would drag herself as well as her family to a lifetime of dishonor, unless that is the
truth, for it is her natural instinct to protect her honor. 21 More so, where her charges
could mean the death of her own father, as in this case.

Appellant likewise points out that it was very unlikely for him to have committed the
crimes imputed to him considering that he and his wife had ten children to attend to
and care for. This argument, however, is impertinent and immaterial. Appellant was
estranged from his wife, and private complainant was the only child who lived with him.
22 As pointed out by the Solicitor General, appellant was thus "free to do as he wished
to satisfy his bestial lust on his daughter." 23

Nor does appellant’s assertion that private complainant has some psychological
problems and a low IQ of 76 in any way favor his defense. These matters did not affect
the credibility of her testimony that appellant raped her twice. We note that the victim
understood the consequences of prosecuting the rape charges against her own father,
as shown by the following testimony of the victim on cross-examination: chanrob1es virtual 1aw library

Q: Were you informed that if, and when your father will be found guilty, your father will
be sentenced to death?

A: Yes.

Q: Until now you wanted that your father will be sentenced by death?

A (Witness nodding.)

x           x          x

Q: I will inform you, Miss Witness, that you have filed two cases against your father
and in case your father would be found guilty, two death sentences will be imposed
against him?

A: Yes.

Q: With that information, do you still want this case would proceed?

A: I want this to proceed. 24

Indeed, appellant is guilty. But is the penalty of death imposed on him correct?

Section 335 of the Revised Penal Code, as amended by Section 11 of R.A. No. 7659, 25
penalizes rape of a minor daughter by her father as qualified rape 26 and a heinous
crime. In proving such felony, the prosecution must allege and prove the elements of
rape: (1) sexual congress; (2) with woman; (3) by force or without her consent 27 and,
in order to warrant the imposition of capital punishment, the additional elements that:
(4) the victim is under 18 years of age at the time of the rape and (5) the offender is a
parent of the victim. 28

In this case, it was sufficiently alleged and proven that the offender was the victim’s
father. 29 But the victim’s age was not properly and sufficiently proved beyond
reasonable doubt. She testified that she was thirteen years old at the time of the rapes.
However, she admitted that she did not know exactly when she was born because her
mother did not tell her. She further said that her birth certificate was likewise with her
mother. In her own words, the victim testified — 30

COURT TO WITNESS

Q: When were you born? —

A: I do not know.
Q: You do not know your birthday?

A: My mama did not tell me exactly when I asked her.

COURT: Proceed.

FISCAL PEREZ: chanrob1es virtual 1aw library

For our failure to secure the Birth Certificate Your Honor, may we just request for
judicial notice that the victim here is below 18 years old.

ATTY. SURALTA: chanrob1es virtual 1aw library

Admitted . . .

Judicial notice is the cognizance of certain facts which judges may properly take and act
on without proof because they already know them. 31 Under the Rules of Court, judicial
notice may either be mandatory or discretionary. Section 1 of Rule 129 of the Rules of
Court provides when court shall take mandatory judicial notice of facts —

SECTION 1. Judicial notice, when mandatory. — A court shall take judicial notice
without the introduction of evidence, of the existence and territorial extent of states,
their political history, forms of government and symbols of nationality, the law of
nations, the admiralty and maritime courts of the world and their seals, the political
constitution and history of the Philippines, the official acts of the legislative, executive
and judicial departments of the Philippines, the laws of nature, the measure of time,
and the geographical divisions. chanrob1es virtua1 1aw 1ibrary

Section 2 of Rule 129 enumerates the instances when courts may take discretionary
judicial notice of facts —

SECTION 2. Judicial notice, when discretionary. — A court may take judicial notice of
matters which are of public knowledge, or are capable of unquestionable demonstration
or ought to be known to judges because of their judicial functions.

Thus, it can be considered of public knowledge and judicially noticed that the scene of
the rape is not always nor necessarily isolated or secluded for lust is no respecter of
time or place. The offense of rape can and has been committed in places where people
congregate, e.g. inside a house where there are occupants, a five (5) meter room with
five (5) people inside, or even in the same room which the victim is sharing with the
accused’s sister. 32

The Court has likewise taken judicial notice of the Filipina’s inbred modesty and shyness
and her antipathy in publicly airing acts which blemish her honor and virtue. 33

On the other hand, matters which are capable of unquestionable demonstration pertain
to fields of professional and scientific knowledge. For example, in People v. Alicante, 34
the trial court took judicial notice of the clinical records of the attending physicians
concerning the birth of twin baby boys as "premature" since one of the alleged rapes
had occurred 6 to 7 months earlier.
As to matters which ought to be known to judges because of their judicial functions, an
example would be facts which are ascertainable from the record of court proceedings,
e.g. as to when court notices were received by a party.

With respect to other matters not falling within the mandatory or discretionary judicial
notice, the court can take judicial notice of a fact pursuant to the procedure in Section 3
of Rule 129 of the Rules of Court which requires that: :: chanrob1es virtua1 1aw 1ibrary

SECTION 3. Judicial notice, when hearing necessary. — During the trial, the court, on
its own initiative, or on request of a party, may announce its intention to take judicial
notice of any matter and allow the parties to be heard thereon.

After the trial, and before judgment or on appeal, the proper court, on its own initiative
or on request of a party, may take judicial notice of any matter and allow the parties to
be heard thereon if such matter is decisive of a material issue in the case.

In this case, judicial notice of the age of the victim is improper, despite the defense
counsel’s admission, thereof acceding to the prosecution’s motion. As required by
Section 3 of Rule 129, as to any other matters such as age, a hearing is required before
courts can take judicial notice of such fact. Generally, the age of the victim may be
proven by the birth or baptismal certificate of the victim, or in the absence thereof,
upon showing that said documents were lost or destroyed, by other documentary or
oral evidence sufficient for the purpose.

Thus, in People v. Rebancos, 172 SCRA 426 (1989), the victim was below 12 and we
found that the rape committed was statutory rape. The mother testified that her
daughter was born on October 26, 1974, and so was only 9 years old at the time of the
rape on February 12, 1984. Although no birth certificate was presented because the
victim’s birth had allegedly not been registered, her baptismal certificate was duly
presented. Hence, we ruled that the mother’s testimony coupled with the presentation
of the baptismal certificate was sufficient to establish that the victim was below 12 at
the time of the rape.

However, in People v. Vargas, 257 SCRA 603 (1996), we ruled that appellant can only
be convicted of simple rape, and not statutory rape, because of failure of the
prosecution to prove the minority of the victim, who was allegedly 10 years old at the
time of the rape. The prosecution failed to present either the birth or baptismal
certificate of the victim. Also there was no showing that the said documents were lost
or destroyed to justify their non- presentation. We held that testimony of the victim and
her aunt were hearsay, and that it was not correct for the trial court to judge the age of
the victim by her appearance. chanrob1es virtua1 1aw 1ibrary

In several recent cases, we have emphasized the need for independent proof of the age
of the victim, aside from testimonial evidence from the victim or her relatives. In People
v. Javier, 35 we stressed that the prosecution must present independent proof of the
age of the victim, even though it is not contested by the defense. The minority of the
victim must be proved with equal certainty and clearness as the crime itself. In People
v. Cula, 36 we reiterated that it is the burden of the prosecution to prove with certainty
the fact that the victim was below 18 when the rape was committed in order to justify
the imposition of the death penalty. Since the record of the case was bereft of any
independent evidence thereon, such as the victim’s duly certified Certificate of Live
Birth, accurately showing private complainant’s age, appellant could not be convicted of
rape in its qualified form. In People v. Veloso, 37 the victim was alleged to have been
only 9 years of age at the time of the rape. It held that the trial court was correct when
it ruled that the prosecution failed to prove the victim’s age other than through the
testimony of her father and herself.

Considering the statutory requirement in Section 335 of the Revised Penal Code as
amended by R.A. No. 7659 and R.A. No. 8353, we reiterate here what the Court has
held in Javier without any dissent, that the failure to sufficiently establish victim’s age
by independent proof is a bar to conviction for rape in its qualified form. For, in the
words of Melo, J., "independent proof of the actual age of a rape victim becomes vital
and essential so as to remove an ‘iota of doubt’ that the case falls under the qualifying
circumstances" for the imposition of the death penalty set by the law.

In this case, the first rape was committed on September 5, 1997 and is therefore
governed by the death penalty law, R.A. 7659. The penalty for the crime of simple rape
or rape in its unqualified form under Art. 335 of the Revised Penal Code, as amended
by Sec. 11 of R.A. 7659, is reclusion perpetua. The second rape was committed on
November 7, 1997, after the effectivity of R.A. 8353, also known as the Anti-Rape Law
of 1997, which took effect on October 22, 1997. The penalty for rape in its unqualified
form remains the same.

As to civil indemnity, the trial court correctly awarded P50,000.00 for each count of
rape as civil indemnity. However, the award of another P50,000.00 as "moral and
exemplary damages under Article 2219 in relation to Articles 2217 and 2230 of the Civil
Code" for each count is imprecise. In rape cases, the prevailing jurisprudence permits
the award of moral damages without need for pleading or proof as to the basis thereof.
38 Thus, pursuant to current jurisprudence, we award the amount of P50,000.00 as
moral damages for each count of rape. chanrob1es virtua1 1aw 1ibrary

The award of exemplary damages separately is also in order, but on a different basis
and for a different amount. Appellant being the father of the victim, a fact duly proved
during trial, we find that the alternative circumstance of relationship should be
appreciated here as an aggravating circumstance. Under Article 2230 of the New Civil
Code, exemplary damages may be imposed when the crime was committed with one or
more aggravating circumstances. Hence, we find an award of exemplary damages in
the amount of P25,000.00 proper. Note that generally, in rape cases imposing the
death penalty, the rule is that relationship is no longer appreciated as a generic
aggravating circumstance in view of the amendments introduced by R.A. Nos. 7659 and
8353. The father-daughter relationship has been treated by Congress in the nature of a
special circumstance which makes the imposition of the death penalty mandatory. 39
However, in this case, the special qualifying circumstance of relationship was proved
but not the minority of the victim, taking the case out of the ambit of mandatory death
sentence. Hence, relationship can be appreciated as a generic aggravating circumstance
in this instance so that exemplary damages are called for. In rapes committed by
fathers on their own daughters, exemplary damages may be imposed to deter other
fathers with perverse tendency or aberrant sexual behavior from sexually abusing their
own daughters. 40
WHEREFORE, the judgment of the Regional Trial Court of Mandaue City, Branch 28, in
Criminal Case Nos. DU-6186 and DU-6203, is hereby MODIFIED as follows: appellant
Tomas Tundag is found guilty of two (2) counts of simple rape; and for each count,
sentenced to reclusion perpetua and ordered to pay the victim the amount of
P50,000.00 as indemnity, P50,000.00 as moral damages, and P25,000.00 as exemplary
damages.

No pronouncement as to costs.

SO ORDERED.

5. REPUBLIC OF THE PHILIPPINES, represented by THE DIRECTOR OF

LANDS, vs.
HON. COURT OF APPEALS and JOSEFA GACOT, G.R. No. 119288 August 18,
1997

 R E S O L U T I O N

VITUG, J.:

The Republic of the Philippines, represented by the Director of Lands, prays in the
instant petition for review on certiorari for the annulment of the decision, dated 22
February 1995, of the Court of Appeals affirming the 12th August 1993 judgment of the
Regional Trial Court of Palawan (Branch 50-Puerto Princesa) which has adjudicated Lot
No. 5367 in Cadastral Case No. 13, GLRO Cadastral Record No. 1133, to herein private
respondent, now deceased Josefa Gacot, the claimant in the cadastral case. chanrobles.com : virtual law library

The antecedents are amply summarized in the appealed decision of the Court of
Appeals, viz.: jgc:chanrobles.com.ph

"The entire lot 5367 is being claimed by Josefa Gacot as per answer she filed on June 7,
1971. It appears from the record that the lot is located in Barangay Los Angeles,
Magsaysay, Palawan but the area was not indicated. It also appeared that Ceferino
Sabenacio is her co-owner.

"This case was set for hearing on August 9, 1990 and the petitioner was represented by
Assistant Provincial Prosecutor Reynaldo Guayco and Rogelio Paglinawan, Community
Environment and Natural Resources Officer (CENRO) of Puerto Princesa City while the
claimant appeared without counsel. In view thereof, the hearing was reset to August
13, 1990. Before the scheduled hearing on August 13, 1990, the Court received a
report from the Land Registration Authority calling the Court’s attention of the decision
rendered by Judge Lorenzo Garlitos on October 20, 1950 declaring this lot as property
of the Republic of the Philippines. Despite this declaration however, the petitioner nor
the government did not bar the claimant from filing her answer, possessing and
occupying the lot and in fact accepted her tax payments and issuing her tax declaration
on the same.

"The claimant presented herself as witness as well as her son, Vicente Dantic, Jr. The
witnesses testified that Josefa Gacot was married to Vicente Dantic, Sr. in 1940 and
were in actual possession of the property for more than 30 years, having bought the
same from Cipriana Dantic-Llanera as per deed of sale dated April 22, 1955 in Cuyono
dialect (Exhibit 1 and 1-A). Since she acquired the property from Cipriana Llanera, she
continued her occupation and introduced improvements thereon as well as declared Lot
5367 for taxation purposes in her name (Exhibit 2) and paid the corresponding taxes
thereon up to the present time (Exhibit 3). That claimant is now a widow and has 5
children namely, Hernando Dantic, Antero Dantic, Felipe Dantic, Fe Dantic and Vicente
Dantic, Jr.

"Cipriano Sabenacio, the alleged co-owner of claimant Josefa Gacot appeared in Court
and manifested that he is waiving his claim over Lot 5367 in favor of Josefa Gacot who
is in actual possession of the property as he is only a boundary owner.

"After the presentation of claimant and her son, they offered their exhibits and rested
their case. Thereafter, the petitioner thru counsel manifested that is not presenting
controverting evidence and is submitting the case for resolution." 1

On 05 September 1990, the trial court rendered judgment adjudicating Lot No. 5367 to
Josefa Gacot, thus —

"WHEREFORE, this Court finds the claim of Josefa Gacot Dantic to be in order.
Accordingly, Lot 5367 is hereby adjudicated to Josefa Gacot-Dantic, widow and a
resident of Barangay Los Angeles, Magsaysay, Palawan with all the improvements
thereon, subject to the estate tax as provided by law." cralaw virtua1aw library

"SO ORDERED." 2

The Republic, through the Solicitor General, elevated the case to the Court of Appeals.

During the pendency of the appeal, the Office of the Solicitor General was able to verify
that Lot 5367 was earlier declared to be the property of the Republic in a decision
rendered by Judge Lorenzo Garlitos on 20 October 1950 following an order of general
default. The Solicitor General thus filed a motion with the appellate court to have the
case reopened and remanded to the court a quo to allow the Republic of the Philippines
to present the decision of Judge Garlitos. In its resolution, dated 26 December 1991,
the Court of Appeals granted the motion.

What transpired thereafter was narrated by the trial court in its 12th August 1993
decision, viz.: jgc:chanrobles.com.ph

"This case was set for hearing several times for the government to present its evidence
and for the parties to submit their respective memorandum in support of their
respective stand on the matter. The claimant submitted her memorandum while the
government represented by the Assistant Provincial Prosecutor assigned to this sala has
not presented any witness to support the government’s claim, neither has he submitted
any memorandum to support the government’s stand on this matter.
"With the foregoing development, the Court is of the opinion that the subsequent
application of claim of Josefa Gacot-Dantic on Lot 5367 which became part of the public
domain where her occupation thereto having been open to the whole world, public and
notorious in the concept of an owner since 38 years ago was well taken and therefore
entitled to the lawful adjudication of Lot 5367 in her name. Besides, the government
represented by the Assistant Provincial Prosecutor and the Community Environment
and Natural Resources Officer (CENRO) for Puerto Princesa City and Cuyo, Palawan
have not made any protest nor interposed any objection on the claim of Josefa Gacot
during the hearings. Neither was there a manifestation of protest or claim of
government use coming from the municipal officials of Magsaysay, Palawan despite
notice sent to them of the cadastral hearing. And the sad part was that the government
had accepted without any protest all the taxes due the property paid by claimant
religiously. This is not to say that this order has been considered in the previous
decision of this Court which is hereunder quoted as follows: chanrob1es virtual 1aw library

x           x          x

"With this finding of the Court, it is its considered opinion and so holds, that there is no
reason to disturb its previous decision aforequoted." 3

An appeal was taken by the Republic from the decision of the trial court. In its now
assailed decision of 22 February 1995, the Court of Appeals affirmed in toto the
judgment of the trial court. The appellate court ratiocinated: jgc:chanrobles.com.ph

"In its brief, the Office of the Solicitor General claims that ‘records of the re-hearing
show that on October 20, 1950, an order was, indeed, issued by Judge Lorenzo C.
Garlitos of the Court of First Instance of Palawan, 7th Judicial District, declaring that Lot
No. 5367 was among lots declared as property of the Republic of the Philippines.’ (p. 3,
Appellant’s Brief, p. 19, Rec.) It now invokes Republic Act No. 931, approved on June
30, 1953 and Republic Act No. 2061, which took effect on June 30, 1958, both laws
setting the time limits for the filing of applications, among other things, for the
reopening of judicial proceedings on certain lands which were declared public land.
Under R.A. 2061, the time for filing an application shall not extend beyond December
31, 1968. Thus, petitioner-appellant argues that since claimant-appellee Josefa Gacot
filed her answer only on 07 June 1971, the court a quo did not acquire jurisdiction over
the instant claim since she did not file her answer within the period fixed by R.A. No.
2061.

"This would be true, if the Order dated 20 October 1950 of Judge Lorenzo Garlitos
declaring Lot No. 5367 as property of the Republic of the Philippines, was presented as
evidence in the rehearing of this case. Unfortunately, the Republic of the Philippines
failed to offer as its exhibit the said order. There is no basis for the appellant, therefore,
to invoke R.A. 2061, to support its claim that claimant-appellee Josefa Gacot filed her
answer beyond the period fixed by said law and therefore the court a quo did not
acquire jurisdiction over the case.

"Precisely, the purpose of the rehearing was to enable the Republic of the Philippines,
thru the Office of the Solicitor General, to present in evidence the said order. The
Solicitor General, in its Motion dated 21 May 1991, prayed that with regard to Lot No.
5367 ‘the proceedings therein be ordered reopened and the same be remanded to the
court a quo to enable the Republic of the Philippines to present the judgment dated
October 20, 1950 of Judge Lorenzo Garlitos declaring Lot No. 5367 as government
property.’ (pp. 30-31, Rollo) [Emphasis ours] chanrobles virtuallawlibrary

"This Court granted the motion and ordered the records of the case remanded to the
court a quo for further proceedings ‘to enable the government to present in evidence
the judgment dated October 20, 1950, declaring Lot No. 5367 as government
property . . . .’ (p. 42, Rollo) [Emphasis ours]

"During the rehearing, however, the Government failed to present the said order of
Judge Garlitos in evidence. Thus, the court a quo said in its appealed decision: jgc:chanrobles.com.ph

"This case was set for hearing several times for the government to present its evidence
and for the parties to submit their respective memoranda in support of their respective
stand on the matter. The claimant submitted her memorandum while the government
represented by the Assistant Provincial Prosecutor has not presented any witness to
present the government’s claim neither has he submitted any memorandum to support
the government’s stand on this matter.’ (see p. 92, Rollo) [Emphasis ours]

"It is the rule that ‘The court shall consider no evidence which has not been formally
offered.’ (Rule 132, Sec. 34) It is true that the Order of 20 October 1950 has been
appended to the records of this case (see p. 19, Rec.). But it is misleading on the part
of the Solicitor General to state that ‘Records of the rehearing show that on October 20,
1950, an order was, indeed, issued by Judge Lorenzo C. Garlitos . . .’ For, during the
rehearing, as reflected in the appealed decision, the government did not present any
evidence nor any memorandum despite having been ordered by the court a quo.

"Neither can We, take judicial notice of the Order of Judge Garlitos. As a general rule,
courts are not authorized to take judicial knowledge of the contents of the record of
other cases, in the adjudication of cases pending before them, even though the trial
judge in fact knows or remembers the contents thereof, or even when said other cases
have been heard or are pending in the same court and notwithstanding the fact that
both cases may have been heard or are really pending before the same judge.
(Municipal Council v. Colegio de San Jose, Et Al., G.R. No. L-45460; 31 C.J.S. 623-624;
cited in p. 25 Evidence, Second Ed., R.J, Francisco) Indeed, the Government missed it
opportunity to have the claim of Josefa Gacot, the herein appellee, declared as a nullity,
considering that no evidence was presented by it in opposition thereto. 4

In the instant petition, the Republic, assigning a sole error, contends that —

"THE HONORABLE COURT OF APPEALS (HAS) ERRED IN RULING THAT THERE IS NO

BASIS FOR PETITIONER TO INVOKE R.A. No. 2061 TO SUPPORT ITS CLAIM THAT
JOSEFA GACOT FILED HER ANSWER BEYOND THE PERIOD FIXED BY THE SAID LAW
AND THEREFORE THE TRIAL COURT DID NOT ACQUIRE JURISDICTION OVER THE
CASE, SINCE IT (HAS) FAILED TO OFFER AS ITS EXHIBIT THE ORDER, DATED
OCTOBER 20, 1950 OF JUDGE LORENZO GARLITOS." 5

The Solicitor General explains that the records of the reopened case would show that a
certified copy of the decision, dated 20 October 1950, of Judge Garlitos has been
appended to page 19 thereof. It is not evident, however, why the Assistant Provincial
Prosecutor and the Community Environment and Natural Resources Officer ("CENRO")
for Puerto Princesa, representing the government during the rehearing, did not present
it. The Solicitor General, nevertheless, invokes the rule that the Republic is not
estopped by the mistake or error on the part of its officials or agents.

In the meantime, Josefa Gacot passed away. The Solicitor General thereupon moved
that the heirs of Josefa Gacot be impleaded party respondents in substitution for the
deceased. The motion was granted and the heirs were directed to comment on the
government’s petition.

To this day, private respondents have not submitted their comment. The Court,
however, cannot allow the case to remain pending and unresolved indefinitely. It must
now dispense, as it hereby dispenses, with such comment in order not to unduly delay
the remand of the case to the trial court for further proceedings.

Let it initially be said that, indeed, the Court realizes the points observed by the
appellate court over which there should be no quarrel. Firstly, that the rules of
procedure 6 and jurisprudence, 7 do not sanction the grant of evidentiary value, 8 in
ordinary trials, 9 of evidence which is not formally offered, and secondly, that adjective
law is not to be taken lightly for, without it, the enforcement of substantive law may not
remain assured. The Court must add, nevertheless, that technical rules of procedure
are not ends in themselves but primarily devised and designed to help in the proper
and expedient dispensation of justice. In appropriate cases, therefore, the rules may
have to be so construed 10 liberally as to meet and advance the cause of substantial
justice.

Furthermore, Section 1, Rule 129, of the Rules of Court provides: jgc:chanrobles.com.ph

"SEC. 1. Judicial notice, when mandatory. — A court shall take judicial notice, without
the introduction of evidence, of the existence and territorial extent of states, their
political history, forms of government and symbols of nationality, the law of nations,
the admiralty and maritime courts of the world and their seals, the political constitution
and history of the Philippines. the official acts of the legislative, executive and judicial
departments of the Philippines, the laws of nature, the measure of time, and the
geographical divisions." cralaw virtua1aw library

Mr. Justice Edgardo L. Paras 11 opined: jgc:chanrobles.com.ph

"A court will take judicial notice of its own acts and records in the same case, of facts
established in prior proceedings in the same case, of the authenticity of its own records
of another case between the same parties, of the files of related cases in the same
court, and of public records on file in the same court. In addition judicial notice will be
taken of the record, pleadings or judgment of a case in another court between the
same parties or involving one of the same parties, as well as of the record of another
case between different parties in the same court. Judicial notice will also be taken of
court personnel." 12

The remand of the case would likewise seem to be unavoidable. The area of Lot No.
5367 claimed and awarded to the late Josefa Gacot had not been specified in the
records. Indeed, on the basis of the Certification of the Forest Management Services of
the Department of Environment and Natural Resources, Lot No. 5367, per Land
Classification (LC) No. 1246 of 15 January 1936, would appear to contain an area of
394,043 square meters, 300,000 square meters of which were classified as Alienable
and Disposable land and 94,043 square meters as Timberland, which under
Proclamation No. 2152, dated 29 December 1981, had been included to form part of
the Mangrove Swamp Forest Reserve, closed for entry, exploitation and settlement. 13

It behooves all concerned that the above matters be carefully looked into, albeit with
reasonable dispatch, for the final resolution of this case.

WHEREFORE, the case is REMANDED to the trial court for further proceedings for it to
ascertain and resolve the conflicting claims of the parties conformably with the
foregoing opinion of the Court. No costs. cdti

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 163267               May 5, 2010

TEOFILO EVANGELISTA, Petitioner,
vs.
THE PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

DEL CASTILLO, J.:

To be guilty of the crime of illegal possession of firearms and ammunition, one does not
have to be in actual physical possess ion thereof. The law does not punish physical
possession alone but possession in general, which includes constructive possession or
the subjection of the thing to the owner’s control.1

This Petition for Review on Certiorari 2 assails the October 15, 2003 Decision 3 of the
Court of Appeals (CA) in CA-G.R. CR No. 21805 which affirmed the January 23, 1998
Decision4 of the Regional Trial Court (RTC) of Pasay City, Branch 109 convicting
petitioner Teofilo Evangelista for violation of Section 1, Presidential Decree (PD) No.
1866,5 as amended, as well as the April 16, 2004 Resolution which denied petitioner’s
Motion for Reconsideration.

Factual Antecedents

In an Information6 dated January 31, 1996, petitioner was charged with violation of

Section 1 of PD 1866 allegedly committed as follows:

That on or about the 30th day of January 1996, at the Ninoy Aquino International
Airport, Pasay City, Philippines, and within the jurisdiction of this Honorable Court, the
above-named accused, did, then and there, wilfully, unlawfully and feloniously have in
his possession, custody and control the following items:

1. One (1) Unit 9mm Jericho Pistol, Israel with SN F-36283 with one (1)
magazine;

2. One (1) Unit Mini-Uzi 9mm Israel Submachine gun with SN 931864 with two
(2) magazines;

3. Nineteen (19) 9mm bullets.

without the corresponding permit or license from competent authority.

CONTRARY TO LAW.

After posting his bail, petitioner filed on February 14, 1996 an Urgent Motion for (a)
Suspension of Proceedings and (b) the Holding of A Preliminary Investigation. 7 The
RTC granted the motion and, accordingly, the State Prosecutor conducted the
preliminary investigation.

In a Resolution8 dated March 6, 1996, the State Prosecutor found no probable cause to

indict petitioner and thus recommended the reversal of the resolution finding probable
cause and the dismissal of the complaint. Thereafter, a Motion to Withdraw
Information9 was filed but it was denied by the trial court in an Order 10 dated March 26,
1996, viz:

Acting on the "Motion to Withdraw Information" filed by State Prosecutor Aida

Macapagal on the ground that [there exists] no probable cause to indict the accused, the
Information having been already filed in Court, the matter should be left to the
discretion of the Court to assess the evidence, hence, for lack of merit, the same is
hereby denied. Let the arraignment of the accused proceed.

When arraigned on March 26, 1996, petitioner pleaded not guilty to the charge.
Thereafter, trial ensued.

Version of the Prosecution

In the morning of January 30, 1996, Maximo Acierto, Jr. (Acierto), a Customs Police
assigned at the Ninoy Aquino International Airport (NAIA) District Command, was
informed by his superior that a certain passenger of Philippine Airlines (PAL) Flight No.
657 would be arriving from Dubai bringing with him firearms and ammunitions. Shortly
after lunch, Acierto, together with Agents Cuymo and Fuentabella, proceeded to the tube
area where they were met by a crewmember who introduced to them herein petitioner.
Acierto asked petitioner if he brought firearms with him and the latter answered in the
affirmative adding that the same were bought in Angola. Thereupon, Acierto was
summoned to the cockpit by the pilot, Capt. Edwin Nadurata (Capt. Nadurata), where
the firearms and ammunitions were turned over to him. Petitioner was then escorted to
the arrival area to get his luggage and thereafter proceeded to the examination room
where the luggage was examined and petitioner was investigated. In open court, Acierto
identified the firearms and ammunitions.

During the investigation, petitioner admitted before Special Agent Apolonio Bustos
(Bustos) that he bought the subject items in Angola but the same were confiscated by
the Dubai authorities, which turned over the same to a PAL personnel in Dubai. Upon
inquiry, the Firearms and Explosive Office (FEO) in Camp Crame certified that
petitioner is neither registered with said office11 nor licensed holder of aforesaid firearms
and ammunitions. Bustos likewise verified from the Bureau of Customs, but his effort
yielded no record to show that the firearms were legally purchased. Among the
documents Bustos had gathered during his investigation were the Arrival Endorsement
Form12 and Customs Declaration Form.13 A referral letter14 was prepared endorsing the
matter to the Department of Justice. Bustos admitted that petitioner was not assisted by
counsel when the latter admitted that he bought the firearms in Angola.

SPO4 Federico Bondoc, Jr. (SPO4 Bondoc), a member of the Philippine National Police
(PNP) and representative of the FEO, upon verification, found that petitioner is not a
licensed/registered firearm holder. His office issued a certification 15 to that effect which
he identified in court as Exhibit "A".

After the prosecution rested its case, petitioner, with leave of court, filed his Demurrer
to Evidence,16 the resolution of which was deferred pending submission of petitioner’s
evidence.17

Version of the Defense

The defense presented Capt. Nadurata whose brief but candid and straightforward
narration of the event was synthesized by the CA as follows:

x x x On January 30, 1996, he was approached by the PAL Station Manager in Dubai,
who informed him that a Filipino contract worker from Angola who is listed as a
passenger of PAL flight from Dubai to Manila, was being detained as he was found in
possession of firearms; that if said passenger will not be able to board the airplane, he
would be imprisoned in Dubai; and that the Arabs will only release the passenger if the
Captain of PAL would accept custody of the passenger [herein petitioner] and the
firearms. Capt. Nadurata agreed to take custody of the firearms and the passenger,
herein appellant, so that the latter could leave Dubai. The firearms were deposited by
the Arabs in the cockpit of the airplane and allowed the appellant to board the airplane.
Upon arrival in Manila, Capt. Nadurata surrendered the firearms to the airport
authorities.

Meanwhile, in view of the unavailability of the defense’s intended witness, Nilo Umayaw
(Umayaw), the PAL Station Manager in Dubai, the prosecution and the defense agreed
and stipulated on the following points:

1. That PAL Station Manager Mr. Nilo Umayaw was told by a Dubai Police that
firearms and ammunitions were found in the luggage of a Filipino passenger
coming from Angola going to the Philippines;

2. That he was the one who turned over the subject firearms to Captain Edwin
Nadurata, the Pilot in command of PAL Flight 657;

3. That the subject firearms [were] turned over at Dubai;

4. That the said firearms and ammunitions were confiscated from the accused
Teofilo Evangelista and the same [were] given to the PAL Station Manager who in
turn submitted [them] to the PAL Pilot, Capt. Edwin Nadurata who has already
testified;

5. That [these are] the same firearms involved in this case. 18

Ruling of the Regional Trial Court

On February 4, 1997, the RTC rendered its Decision, the dispositive portion of which
reads:

In view of all the foregoing, the Court finds accused TEOFILO E. EVANGELISTA guilty
beyond reasonable doubt for violation of Sec. 1, P.D. 1866 as amended (Illegal
Possession of Firearms and Ammunitions: (One (1) Unit Mini-Uzi 9mm Israel
submachine gun with SN-931864 with two (2) magazines and nineteen (19) 9mm
bullets) and hereby sentences him to imprisonment of Seventeen (17) Years and Four
(4) Months to Twenty (20) Years.

The above-mentioned firearms are hereby ordered forfeited in favor of the government
and is ordered transmitted to the National Bureau of Investigation, Manila for proper
disposition.

SO ORDERED.19

On April 4, 1997, petitioner filed a Motion for New Trial 20 which the RTC
granted.21 Forthwith, petitioner took the witness stand narrating his own version of the
incident as follows:

On January 28, 1996, he was at Dubai International Airport waiting for his flight to the
Philippines. He came from Luwanda, Angola where he was employed as a seaman at Oil
International Limited. While at the airport in Dubai, Arab policemen suddenly accosted
him and brought him to their headquarters where he saw guns on top of a table. The
Arabs maltreated him and forced him to admit ownership of the guns. At this point, PAL
Station Manager Umayaw came and talked to the policemen in Arabian dialect. Umayaw
told him that he will only be released if he admits ownership of the guns. When he
denied ownership of the same, Umayaw reiterated that he (petitioner) will be released
only if he will bring the guns with him to the Philippines. He declined and insisted that
the guns are not his. Upon the request of Umayaw, petitioner was brought to the Duty
Free area for his flight going to the Philippines. When he was inside the plane, he saw
the Arab policemen handing the guns to the pilot. Upon arrival at the NAIA, he was
arrested by the Customs police and brought to the arrival area where his passport was
stamped and he was made to sign a Customs Declaration Form without reading its
contents. Thereafter, he was brought to a room at the ground floor of the NAIA where he
was investigated. During the investigation, he was not represented by counsel and was
forced to accept ownership of the guns. He denied ownership of the guns and the fact
that he admitted having bought the same in Angola.

Ruling of the Regional Trial Court

After new trial, the RTC still found petitioner liable for the offense charged but modified
the penalty of imprisonment. The dispositive portion of the Decision dated January 23,
1998 reads:

In view of all the foregoing, the Court finds accused TEOFILO E. EVANGELISTA guilty
beyond reasonable doubt for violation of Sec. 1, P.D. 1866 as amended (Illegal
Possession of Firearms and Ammunitions: One (1) Unit 9mm Jerico Pistol, Israel with
SN F-36283 with one (1) magazine; One (1) Unit Mini-Uzi 9mm Israel submachine gun
with SN-931864 with two (2) magazines and nineteen (19) 9mm bullets and hereby
sentences him to imprisonment of Six (6) Years and One (1) Day to Eight (8) Years and a
fine of P30,000.00.

The above-mentioned firearms are hereby ordered forfeited in favor of the government
and [are] ordered transmitted to the National Bureau of Investigation, Manila for
proper disposition.

SO ORDERED.22

Ruling of the Court of Appeals

On appeal, the CA affirmed the findings of the trial court in its Decision dated October
15, 2003. It ruled that the stipulations during the trial are binding on petitioner. As
regards possession of subject firearms, the appellate court ruled that Capt. Nadurata’s
custody during the flight from Dubai to Manila was for and on behalf of petitioner.
Thus, there was constructive possession.

Petitioner moved for reconsideration 23 but it was denied by the appellate court in its
April 16, 2004 Resolution.

Hence, this petition.

Issues

Petitioner assigns the following errors:

a. The Court of Appeals gravely erred in not acquitting Evangelista from the
charge of Presidential Decree No. 1866, Illegal Possession of Firearms.

b. The Court of Appeals gravely erred in not holding that Evangelista was never in
possession of any firearm or ammunition within Philippine jurisdiction and he
therefore could not have committed the crime charged against him.

c. The Court of Appeals gravely erred in holding that Evangelista committed a

continuing crime.

d. The Court of Appeals gravely erred in disregarding the results of the

preliminary investigation.24

We find the appeal devoid of merit.

At the outset, we emphasize that under Rule 45 of the Rules of Court, a petition for
review on certiorari shall only raise questions of law considering that the findings of fact
of the CA are, as a general rule, conclusive upon and binding on the Supreme Court. 25 In
this recourse, petitioner indulges us to calibrate once again the evidence adduced by the
parties and to re-evaluate the credibility of their witnesses. On this ground alone, the
instant petition deserves to be denied outright. However, as the liberty of petitioner is at
stake and following the principle that an appeal in a criminal case throws the whole case
wide open for review, we are inclined to delve into the merits of the present petition.

In his bid for acquittal, petitioner argues that he could not have committed the crime
imputed against him for he was never in custody and possession of any firearm or
ammunition when he arrived in the Philippines. Thus, the conclusion of the appellate
court that he was in constructive possession of the subject firearms and ammunitions is
erroneous.

We are not persuaded. As correctly found by the CA:

Appellant’s argument that he was never found in possession of the subject firearms and
ammunitions within Philippine jurisdiction is specious. It is worthy to note that at the
hearing of the case before the court a quo on October 8, 1996, the defense counsel
stipulated that the subject firearms and ammunitions were confiscated from appellant
and the same were given to PAL Station Manager Nilo Umayaw who, in turn, turned
over the same to Capt. Edwin Nadurata. Such stipulation of fact is binding on appellant,
for the acts of a lawyer in the defense of a case are the acts of his client. Granting that
Nilo Umayaw was merely told by the Dubai authorities that the firearms and
ammunitions were found in the luggage of appellant and that Umayaw had no personal
knowledge thereof, however, appellant’s signature on the Customs Declaration Form,
which contains the entry "2 PISTOL guns SENT SURRENDER TO PHILIPPINE
AIRLINE," proves that he was the one who brought the guns to Manila. While appellant
claims that he signed the Customs Declaration Form without reading it because of his
excitement, however, he does not claim that he was coerced or persuaded in affixing his
signature thereon. The preparation of the Customs Declaration Form is a requirement
for all arriving passengers in an international flight. Moreover, it cannot be said that
appellant had already been arrested when he signed the Customs Declaration Form. He
was merely escorted by Special Agent Acierto to the arrival area of the NAIA. In fact,
appellant admitted that it was only after he signed the Customs Declaration Form that
he was brought to the ground floor of NAIA for investigation. Consequently, appellant
was in constructive possession of the subject firearms. As held in People v. Dela Rosa,
the kind of possession punishable under PD 1866 is one where the accused possessed a
firearm either physically or constructively with animus possidendi or intention to
possess the same. Animus possidendi is a state of mind. As such, what goes on into the
mind of the accused, as his real intent, could be determined solely based on his prior
and coetaneous acts and the surrounding circumstances explaining how the subject
firearm came to his possession.

Appellant’s witness, Capt. Nadurata, the PAL pilot of Flight No. PR 657 from Dubai to
Manila on January 30, 1996, testified that he accepted custody of the firearms and of
appellant in order that the latter, who was being detained in Dubai for having been
found in possession of firearms, would be released from custody. In other words, Capt.
Nadurata’s possession of the firearm during the flight from Dubai to Manila was for and
on behalf of appellant.26

We find no cogent reason to deviate from the above findings, especially considering
petitioner’s admission during the clarificatory questioning by the trial court:

Court: So, it is clear now in the mind of the Court, that the firearms and ammunitions
will also be with you on your flight to Manila, is that correct?

A: Yes, your honor.

Court: [You] made mention of that condition, that the Dubai police agreed to
release you provided that you will bring the guns and ammunitions with you? Is
that the condition of the Dubai Police?

A: Yes, your honor.

Court: The condition of his release was that he will have to bring the guns and
ammunitions to the Philippines and this arrangement was made by the PAL
Supervisor at Dubai and it was Mr. Umayaw the PAL Supervisor, who interceded
in his behalf with the Dubai Police for his flight in the Philippines. 27

To us, this constitutes judicial admission of his possession of the subject firearms and
ammunitions. This admission, the veracity of which requires no further proof, may be
controverted only upon a clear showing that it was made through palpable mistake or
that no admission was made.28 No such controversion is extant on record.
Moreover, we cannot ignore the Customs Declaration Form wherein it appeared that
petitioner brought the firearms with him upon his arrival in the Philippines. While there
was no showing that he was forced to sign the form, petitioner can only come up with
the excuse that he was excited. Hardly can we accept such pretension.

We are likewise not swayed by petitioner’s contention that the lower court erroneously
relied on the Customs Declaration Form since it is not admissible in evidence because it
was accomplished without the benefit of counsel while he was under police custody.

The accomplishment of the Customs Declaration Form was not elicited through
custodial investigation. It is a customs requirement which petitioner had a clear
obligation to comply. As correctly observed by the CA, the preparation of the Customs
Declaration Form is a requirement for all arriving passengers in an international flight.
Petitioner was among those passengers. Compliance with the constitutional procedure
on custodial investigation is, therefore, not applicable in this case. Moreover, it is
improbable that the customs police were the ones who filled out the declaration form. As
will be noted, it provides details that only petitioner could have possibly known or
supplied. Even assuming that there was prior accomplishment of the form which
contains incriminating details, petitioner could have easily taken precautionary
measures by not affixing his signature thereto. Or he could have registered his objection
thereto especially when no life threatening acts were being employed against him upon
his arrival in the country.

Obviously, it was not only the Customs Declaration Form from which the courts below
based their conclusion that petitioner was in constructive possession of subject firearms
and ammunitions. Emphasis was also given on the stipulations and admissions made
during the trial. These pieces of evidence are enough to show that he was the owner and
possessor of these items.

Petitioner contends that the trial court has no jurisdiction over the case filed against
him. He claims that his alleged possession of the subject firearms transpired while he
was at the Dubai Airport and his possession thereof has ceased when he left for the
Philippines. He insists that since Dubai is outside the territorial jurisdiction of the
Philippines and his situation is not one of the exceptions provided in Article 2 of the
Revised Penal Code, our criminal laws are not applicable. In short, he had not
committed a crime within the Philippines.

Indeed it is fundamental that the place where the crime was committed determines not
only the venue of the action but is an essential element of jurisdiction. 29 In order for the
courts to acquire jurisdiction in criminal cases, the offense should have been committed
or any one of its essential ingredients should have taken place within the territorial
jurisdiction of the court. If the evidence adduced during the trial shows that the offense
was committed somewhere else, the court should dismiss the action for want of
jurisdiction.30

Contrary to the arguments put forward by petitioner, we entertain no doubt that the
crime of illegal possession of firearms and ammunition for which he was charged was
committed in the Philippines. The accomplishment by petitioner of the Customs
Declaration Form upon his arrival at the NAIA is very clear evidence that he was already
in possession of the subject firearms in the Philippines.

And more than mere possession, the prosecution was able to ascertain that he has no
license or authority to possess said firearms. It bears to stress that the essence of the
crime penalized under PD 1866, as amended, is primarily the accused’s lack of license to
possess the firearm. The fact of lack or absence of license constitutes an essential
ingredient of the offense of illegal possession of firearm. Since it has been shown that
petitioner was already in the Philippines when he was found in possession of the subject
firearms and determined to be without any authority to possess them, an essential
ingredient of the offense, it is beyond reasonable doubt that the crime was perpetrated
and completed in no other place except the Philippines.

Moreover, the jurisdiction of a court over the criminal case is determined by the
allegations in the complaint or information. In this case, the information specifically and
categorically alleged that on or about January 30, 1996 petitioner was in possession,
custody and control of the subject firearms at the Ninoy Aquino International Airport,
Pasay City, Philippines, certainly a territory within the jurisdiction of the trial court.

In contrast, petitioner failed to establish by sufficient and competent evidence that the
present charge happened in Dubai. It may be well to recall that while in Dubai,
petitioner, even in a situation between life and death, firmly denied possession and
ownership of the firearms. Furthermore, there is no record of any criminal case having
been filed against petitioner in Dubai in connection with the discovered firearms. Since
there is no pending criminal case when he left Dubai, it stands to reason that there was
no crime committed in Dubai. The age-old but familiar rule that he who alleges must
prove his allegation applies.31

Petitioner finally laments the trial court’s denial of the Motion to Withdraw Information
filed by the investigating prosecutor due to the latter’s finding of lack of probable cause
to indict him. He argues that such denial effectively deprived him of his substantive
right to a preliminary investigation.

Still, petitioner’s argument fails to persuade. There is nothing procedurally improper on

the part of the trial court in disregarding the result of the preliminary investigation it
itself ordered. Judicial action on the motion rests in the sound exercise of judicial
discretion. In denying the motion, the trial court just followed the jurisprudential rule
laid down in Crespo v. Judge Mogul32 that once a complaint or information is filed in
court, any disposition of the case as to its dismissal or the conviction or acquittal of the
accused rests on the sound discretion of the court. The court is not dutifully bound by
such finding of the investigating prosecutor. In Solar Team Entertainment, Inc v. Judge
How33 we held:

It bears stressing that the court is however not bound to adopt the resolution of the
Secretary of Justice since the court is mandated to independently evaluate or assess the
merits of the case, and may either agree or disagree with the recommendation of the
Secretary of Justice. Reliance alone on the resolution of the Secretary of Justice would
be an abdication of the trial court’s duty and jurisdiction to determine prima facie case.
Consequently, petitioner has no valid basis to insist on the trial court to respect the
result of the preliminary investigation it ordered to be conducted.

In fine, we find no reason not to uphold petitioner’s conviction. The records substantiate
the RTC and CA’s finding that petitioner possessed, albeit constructively, the subject
firearms and ammunition when he arrived in the Philippines on January 30, 1996.
Moreover, no significant facts and circumstances were shown to have been overlooked
or disregarded which if considered would have altered the outcome of the case.

In the prosecution for the crime of illegal possession of firearm and ammunition, the
Court has reiterated the essential elements in People v. Eling34 to wit: (1) the existence
of subject firearm; and, (2) the fact that the accused who possessed or owned the same
does not have the corresponding license for it.

In the instant case, the prosecution proved beyond reasonable doubt the elements of the
crime. The existence of the subject firearms and the ammunition were established
through the testimony of Acierto. Their existence was likewise admitted by petitioner
when he entered into stipulation and through his subsequent judicial admission.
Concerning petitioner’s lack of authority to possess the firearms, SPO4 Bondoc, Jr.
testified that upon verification, it was ascertained that the name of petitioner does not
appear in the list of registered firearm holders or a registered owner thereof. As proof,
he submitted a certification to that effect and identified the same in court. The
testimony of SPO4 Bondoc, Jr. or the certification from the FEO would suffice to prove
beyond reasonable doubt the second element.35

A final point. Republic Act (RA) No. 8294 36 took effect on June 6, 1997 or after the
commission of the crime on January 30, 1996. However, since it is advantageous to the
petitioner, it should be given retrospective application insofar as the penalty is
concerned.

Section 1 of PD 1866, as amended by RA 8294 provides:

Section 1. Unlawful Manufacture, Sale, Acquisition, Disposition or Possession of

Firearms or Ammunition or Instruments Used or Intended to be Used in the
Manufacture of Firearms or Ammunition. x x x

The penalty of prision mayor in its minimum period and a fine of Thirty thousand pesos
(P30,000.00) shall be imposed if the firearm is classified as high powered firearm which
includes those with bores bigger in diameter than .38 caliber and 9 millimeter such as
caliber .40, .41, .44, .45 and also lesser calibered firearms but considered powerful such
as caliber .357 and caliber .22 center-fire magnum and other firearms with firing
capability of full automatic and by burst of two or three: Provided, however, That no
other crime was committed by the person arrested.

Prision mayor in its minimum period ranges from six years and one day to eight years.
Hence, the penalty imposed by the RTC as affirmed by the CA is proper.
WHEREFORE, the petition is DENIED. The assailed Decision of the Court of Appeals
in CA-G.R. CR No. 21805 affirming the January 23, 1998 Decision of the Regional Trial
Court of Pasay City, Branch 109 dated January 23, 1998, convicting petitioner Teofilo
Evangelista of violation of Section 1 of Presidential Decree No. 1866, as amended, and
sentencing him to suffer the penalty of imprisonment of six years and one day to eight
years and to pay a fine of P30,000.00 is AFFIRMED.

SO ORDERED.

MARIANO C. DEL CASTILLO

Associate Justice

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 181508               October 2, 2013

OSCAR CONSTANTINO, MAXIMA CONSTANTINO and CASIMIRA

MATURINGAN, Petitioners,
vs.
HEIRS OF PEDRO CONSTANTINO, JR., represented by ASUNCION
LAQUINDANUM, Respondents.

DECISION

PEREZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of
Court assailing the 31 May 2007 Decision1 of the Court of Appeals in CA-G.R. CV No.
81329, which reversed the 27 October 2003 Decision 2 of the Regional Trial Court (RTC),
Branch 18 of Malolos City, Bulacan, in a complaint for Declaration of Nullity of
"Pagmamana sa Labas ng Hukuman," Tax Declaration Nos. 96-10022-02653 &
1002655, With Prayer for a Writ of Preliminary Injunction & Damages docketed as Civil
Case No. 630-M-99.

The facts

This involves a controversy over a parcel of land claimed to be part of an estate which
needed to be proportionally subdivided among heirs.

Pedro Constantino, Sr., (Pedro Sr.) ancestors of the petitioners and respondents, owned
several parcels of land, one of which is an unregistered parcel of land declared for
taxation purposes under Tax Declaration 20814 3 consisting of 240 square meters
situated at Sta. Monica, Hagonoy, Bulacan. Pedro, Sr., upon his death, was survived by
his six (6) children, namely: 1) PEDRO CONSTANTINO, JR. (Pedro Jr.), the
grandfather of the respondents; 2) ANTONIA CONSTANTINO, who later died without
issue; 3) CLARA CONSTANTINO, who also later died without issue; 4)
BRUNOCONSTANTINO, who was survived by his 6 children including petitioner
Casimira Constantino-Maturingan; 5) EDUARDO CONSTANTINO, who is survived by
his daughter Maura; and 6) SANTIAGO CONSTANTINO, who was survived by his five
(5) children which includes petitioner Oscar Constantino.4

On 17 June 1999, respondents Asuncion Laquindanum (Asuncion)and Josefina Cailipan

(Josefina), great grandchildren of Pedro Sr., in representation of Pedro, Jr. filed a
complaint5against petitioners Oscar Constantino, Maxima Constantino and Casimira
Maturingan, grandchildren of Pedro Sr., for the nullification of a document
denominated as "Pagmamana sa Labas ng Hukuman" dated 10 August 1992, 6 Tax
Declaration Nos. 96-10022 (02653) 7 and 96-10022 (02655)8 and reinstatement of Tax
Declaration No. 208149 in the name of Pedro Sr.

In the said complaint, respondents alleged that sometime in October 1998, petitioners
asserted their claim of ownership over the whole parcel of land (240 sq m) owned by the
late Pedro Sr., to the exclusion of respondents who are occupying a portion thereof.
Upon verification, respondents learned that a Tax Declaration No. 02010-2170-33235 in
the name of petitioner Oscar Constantino and his cousin Maxima Constantino was
unlawfully issued, which in effect canceled Tax Declaration No. 20814 in the name of
their ancestor Pedro Sr. The issuance of the new tax declaration was allegedly due to the
execution of a simulated, fabricated and fictitious document denominated as
"Pagmamana sa Labas ng Hukuman," wherein the petitioners misrepresented
themselves as the sole and only heirs of Pedro Sr. It was further alleged that
subsequently, the subject land was divided equally between petitioners Oscar and
Maxima resulting in the issuance of Tax Declaration No. 96-10022-02653 10 in the name
of Oscar, with an area of 120sq m and the other half in the name of Maxima covered by
Tax Declaration No. 96-10022-02652.11 The share of Maxima was eventually conveyed
to her sister, petitioner Casimira in whose name a new Tax Declaration No. 96-10022-
0265512 was issued.

Thus, respondents sought to annul the "Pagmamana sa Labas ngHukuman" as well as

the Tax Declarations that were issued on the basis of such document.

The petitioners, on the other hand, averred in their Answer With Counterclaim 13 that
Pedro Sr., upon his death, left several parcels of land, namely: 1) a lot with an area of
240 sq m covered by Tax Declaration No.20814; 2) a lot with an area of 192 sq m also
situated at Sta. Monica,Hagonoy, Bulacan, previously covered by Tax Declaration No.
9534; and 3)an agricultural land with an area of Four (4) hectares, more or less. The
petitioners claimed that the document "Pagmamana sa Labas ng Hukuman" pertaining
to the 240 sq m lot was perfectly valid and legal, as it was a product of mutual and
voluntary agreement between and among the descendants of the deceased Pedro Sr.
Further, petitioners alleged that the respondents have no cause of action against them
considering that the respondents’ lawful share over the estate of Pedro Sr., had already
been transferred to them as evidenced by the Deed of Extrajudicial Settlement with
Waiver14 dated 5 December 1968,executed by Angelo Constantino, Maria Constantino
(mother of respondent Asuncion), Arcadio Constantino and Mercedes Constantino, all
heirs of Pedro Jr. In the said deed, respondents adjudicated unto themselves to the
exclusion of other heirs, the parcel of land with an area of 192 sq m by misrepresenting
that they were "the only legitimate heirs of Pedro Sr. Thus, petitioners claimed that in
the manner similar to the assailed "Pagmamana sa Labas ng Hukuman," they asserted
their rights and ownership over the subject 240 sq m lot without damage to the
respondents.

In essence, petitioners position was that the Deed of Extrajudicial Settlement with
Waiver which led to the issuance of Tax Declaration No.9534 was acquiesced in by the
other heirs of Pedro Sr., including the petitioners, on the understanding that the
respondent heirs of Pedro Jr. would no longer share and participate in the settlement
and partition of the remaining lot covered by the "Pagmamana sa Labas ng Hukuman."

On 15 August 2000, pre-trial conference 15 was conducted wherein the parties entered
into stipulations and admissions as well as identification of the issues to be litigated.
Thereupon, trial on the merits ensued.

On 27 October 2003, the RTC rendered a Decision 16 in favor of the respondents finding
that:

As a result of execution of "Extrajudicial Settlement with Waiver" dated December 5,

1968 (Exh. "2") executed by the heirs of Pedro Constantino, Jr., a son of Pedro
Constantino, Sr. and the subsequent execution of another deed denominated as
"Pagmamana sa Labas ng Hukuman" dated August 10, 1992 (Exh. "E") executed by the
heirs of Santiago and Bruno Constantino, also other sons of Pedro Constantino, Sr., to
the exclusion of the other heirs, namely, those of ANTONIA, CLARA, and EDUARDO
CONSTANTINO, both plaintiffs and defendants acted equally at fault. They are in pari
delicto, whereby the law leaves them as they are and denies recovery by either one of
them. (See:Yu Bun Guan v. Ong, 367 SCRA 559). Parties who are equally guilty cannot
complain against each other. (Sarmiento v. Salud, 45 SCRA 213.)

Supplementing the law on the matter, that is, the provision of Article 19 of the New Civil
Code whereby every person must, in the exercise of his rights and in the performance of
his duties, act with justice, give everyone his due, and observe honesty and good faith, is
the legal maxim that "he who comes to court to demand equity must come with clean
hands." (LBC Express, Inc. v. Court of Appeals, 236 SCRA 602).

Although, plaintiffs-heirs of Pedro Constantino, Jr., including Asuncion Laquindanum

and Josefina Cailipan, are not parties or signatories to the "Extrajudicial Settlement
with Waiver" dated December 5, 1968, they are successors-in-interest of Pedro
Constantino, Jr. They areconsidered "privies" to said deed, and are bound by said
extrajudicial settlement. (See: Cabresos v. Tiro, 166 SCRA 400). In other words, they are
"PRIVIES IN ESTATE". (Correa v. Pascual, 99 Phil. 696, 703).
Consequently, plaintiffs are now estopped from claiming otherwise. (See: PNB v. CA, 94
SCRA 357). They are estopped to share in the real property subject matter of this case.
In fine, they are not entitled to the reliefs prayed for. (Communication Materials &
Design, Inc. v. CA, 260 SCRA 673).

With respect to alleged damages claimed by plaintiffs against defendants in their

Complaint and counterclaim for damages by defendants against plaintiffs in their
Answer, both claims are hereby dismissed for lack of valid factual and legal foundations.

Disposition

WHEREFORE, in view of the foregoing premises and disquisition, the deed

denominated as "Pagmamana sa Labas ng Hukuman" of August 10, 1992 and Tax
Declaration No. 96-10022-02653 in the name of Oscar Constantino and Tax Declaration
No. 96-10022-02655 in the name of Casimira C. Maturingan (from Maxima Constantino
to Casimira C. Maturingan) stand. Plaintiffs’ Complaint for nullification thereof with
damages is hereby DISMISSED.17

Not convinced, the respondents appealed the afore quoted decision to the Court of
Appeals (CA) raising, among others, the erroneous application by the trial court of the
doctrine of "in pari delicto" in declaring the validity of the document "Pagmamana sa
Labas ng Hukuman."

In its 31 May 2007 Decision,18 the CA ruled in favor of the respondents heirs of Pedro,
Jr., declaring that the "Extrajudicial Settlement with Waiver" dated 5 December 1968
they executed covering the 192 sqm lot actually belongs to Pedro Jr., hence, not part of
the estate of Pedro Sr. The CA rationated in this wise:

The 192 square meters lot which was adjudicated in the "Extrajudicial Settlement with
Waiver" dated 5 December 1968 among the heirs of Pedro Jr. namely Angelo, Maria,
Arcadio and Mercedes is a property belonging to Pedro Jr. although there is a
typographical error in that the name of Pedro Jr. was inadvertently typed only as Pedro
Constantino. It is clear from the reading of the document that a typographical error was
committed because the four (4) children of PedroJr. by Felipa dela Cruz were
specifically identified. Further, during the presentation of evidence of the plaintiffs-
appellants, it was rebutted that Pedro Sr. had six (6) legitimate children namely: Pedro
Jr., Antonia, Clara, Santiago, Bruno and Eduardo19 and Pedro Jr. had four (4).20

Thus, the CA went on to state that the respondents, heirs of Pedro Jr., did not adjudicate
the 192 sq m lot unto themselves to the exclusion of all the other heirs of Pedro Sr.
Rather, the adjudication in the document entitled "Extrajudicial Settlement with Waiver
dated 5 December 1968 pertains to a different property and is valid absent any evidence
to the contrary. Hence, it is erroneous for the trial court to declare the parties in pari
delicto.

The Issue
The petitioners now question the said ruling assigning as error, among others, the
failure of the CA to appreciate the existence of misrepresentation in both documents,
thereby ignoring the propriety of the application of the in pari delicto doctrine. Likewise
assailed is the erroneous disregard by the CA of stipulations and admissions during the
pre-trial conference on which the application of the doctrine of in pari delicto was based.

Our Ruling

Latin for "in equal fault," in pari delicto connotes that two or more people are at fault or
are guilty of a crime. Neither courts of law nor equity will interpose to grant relief to the
parties, when an illegal agreement has been made, and both parties stand in pari
delicto.21 Under the pari delicto doctrine, the parties to a controversy are equally
culpable or guilty, they shall have no action against each other, and it shall leave the
parties where it finds them. This doctrine finds expression in the maxims "ex dolo malo
nonoritur actio" and "in pari delicto potior est conditio defendentis." 22

When circumstances are presented for the application of such doctrine, courts will take
a hands off stance in interpreting the contract for or against any of the parties. This is
illustrated in the case of Packaging Products Corporation v. NLRC, 23 where this Court
pronounced that:

This Court cannot give positive relief to either petitioner or respondent because we are
asked to interpret and enforce an illegal and immoral arrangement. (See Articles 1409,
1411, and 1412 of the Civil Code). Kickback arrangements in the purchase of raw
materials, equipment, supplies and other needs of offices, manufacturers, and
industrialists are so widespread and pervasive that nobody seems to know how to
eliminate them. x x x.

Both the petitioners and the private respondent are in pari delicto. Neither one may
expect positive relief from courts of justice in the interpretation of their contract. The
courts will leave them as they were at the time the case was filed. 24

As a doctrine in civil law, the rule on pari delicto is principally governed by Articles 1411
and 1412 of the Civil Code, which state that:

Article 1411. When the nullity proceeds from the illegality of the cause or object of the
contract, and the act constitutes a criminal offense, both parties being in pari delicto,
they shall have no action against each other, and both shall be prosecuted.

xxx xxx

Article 1412. If the act in which the unlawful or forbidden cause consists does not
constitute a criminal offense, the following rules shall be observed:

xxx xxx
1. When the fault is on the part of both contracting parties, neither may recover what he
has given by virtue of the contract, or demand the performance of the other’s
undertaking;

xxx xxx.

The petition at bench does not speak of an illegal cause of contract constituting a
criminal offense under Article 1411. Neither can it be said that Article 1412 finds
application although such provision which is part of Title II, Book IV of the Civil Code
speaks of contracts in general, as well as contracts which are null and void ab initio
pursuant to Article 1409 of the Civil Code - such as the subject contracts, which as
claimed, are violative of the mandatory provision of the law on legitimes.

We do not dispute that herein parties, through the Deeds they separately executed
deprived each other of rightful shares in the two lots subject of the separate contracts -
that is, if the two (2) parcels of land subject matter thereof, form part of the estate of the
late Pedro Sr.

It is asserted by the petitioners that their execution in 1992 of the contract denominated
as "Pagmamana sa Labas ng Hukuman" which excluded other heirs of Pedro Sr., was
with an underlying agreement with the other heirs including Maria Constantino,
daughter of Pedro Jr. and grandmother of respondents. 25 The agreement was for the
other heirs to recognize the 192 square meters lot subject matter of the "Extrajudicial
Settlement with Waiver" executed in 1968 as the share of the heirs of Pedro Sr. in the
estate of Pedro Sr., Petitioners respected such agreement, as in fact, Maria
Laquindanum and that of her heirs, herein respondents, were not disturbed in their
possession or ownership over the said parcel of land; thus, the heirs of Pedro Jr. were
said to have acquiesced26 to the "Pagmamana sa Labas ng Hukuman" and the underlying
agreement and therefore they have no recourse or reason to question it taking cue from
the doctrine of in paridelicto. This was the basis of the trial court’s findings that
respondents are now estopped from claiming otherwise. 27

We find that the trial court erroneously applied the doctrine.

This is not to say, however, that the CA was correct in upholding the validity of the
contract denominated as "Pagmamana sa Labas ng Hukuman." The CA decision being,
likewise, based on pari delicto, is also incorrect.

Finding the inapplicability of the in pari delicto doctrine, We find occasion to stress that
Article 1412 of the Civil Code that breathes life to the doctrine speaks of the rights and
obligations of the parties to the contract with an illegal cause or object which does not
constitute a criminal offense. It applies to contracts which are void for illegality of
subject matter and not to contracts rendered void for being simulated, 28 or those in
which the parties do not really intend to be bound thereby. Specifically, in pari delicto
situations involve the parties in one contract who are both at fault, such that neither can
recover nor have any action against each other.
In this case, there are two Deeds of extrajudicial assignments unto the signatories of the
portions of the estate of an ancestor common to them and another set of signatories
likewise assigning unto themselves portions of the same estate. The separate Deeds
came into being out of an identical intention of the signatories in both to exclude their
co-heirs of their rightful share in the entire estate of Pedro Sr. It was, in reality, an
assignment of specific portions of the estate of Pedro Sr., without resorting to a lawful
partition of estate as both sets of heirs intended to exclude the other heirs.

Clearly, the principle of in pari delicto cannot be applied. The inapplicability is dictated
not only by the fact that two deeds, not one contract, are involved, but because of the
more important reason that such an application would result in the validation of both
deeds instead of their nullification as necessitated by their illegality. It must be
emphasized that the underlying agreement resulting in the execution of the deeds is
nothing but a void agreement. Article 1409 of the Civil Code provides that:

ART. 1409. The following contracts are in existent and void from the beginning:

(1) Those whose cause, object or purpose is contrary to law; morals, good customs,
public order or public policy;

x x x           x x x          x x x

Corollarily, given the character and nature of the deeds as being void and in existent, it
has, as a consequence, of no force and effect from the beginning, as if it had never been
entered into and which cannot be validated either by time or ratification. 29

That said, we cannot give credence to the contention of respondents that no fault can be
attributed to them or that they are free from the effects of violation of any laws arising
from the supposed unlawful agreement entered into between Maria Laquindanum, their
predecessor-in-interest, and the other heirs, including petitioners herein, based on the
fact that they are not signatories to said agreement, thus, the lack of any binding effect
to them. Respondents argued and set forth as an issue during the trial that they were not
signatories to any of the contract or privies to such an arrangement. It is not disputed,
however, that respondents are successors-in-interest of Maria Laquindanum, one of the
signatories in the Extrajudicial Settlement with Waiver who was also allegedly in
agreement with the petitioners.

On this note, We agree with the trial court that respondents are "privies" to Maria
Laquindanum. By the term "privies" is meant those between whom an action is deemed
binding although they are not literally parties to the said action. 30 This Court, in Correa
v. Pascual,31 had occasion to explain that "privity in estate denotes the privity between
assignor and assignee, donor and donee, grantor and grantee, joint tenant for life and
remainderman or reversioner and their respective assignees, vendor by deed of
warranty and a remote vendee or assignee. A privy in estate is one, it has been said, who
derives his title to the property in question by purchase; one who takes by conveyance."
In fine, respondents, as successors-in-interest, derive their right from and are in the
same position as their predecessor in whose shoes they now stand. As such successors,
respondents’ situation is analogous to that of a transferee pendente lite illustrated in
Santiago Land Development Corporation v. Court of Appeals, 32 reiterating Fetalino v.
Sanz33 where this Court held:

As such, he stands exactly in the shoes of his predecessor in interest, the original
defendant, and is bound by the proceedings had in the case before the property was
transferred to him. He is a proper, but not an indispensable, party as he would, in any
event, have been bound by the judgment against his predecessor. 34

Thus, any condition attached to the property or any agreement precipitating the
execution of the Deed of Extrajudicial Settlement with Waiver which was binding upon
Maria Laquindanum is applicable to respondents who merely succeeded Maria.

This notwithstanding, it must however be shown that the Deed of Extrajudicial

Settlement with Waiver, referred to a property owned by Pedro Sr. There is such basis
from the facts of this case.

The records show that apart from respondent Asuncion Laquindanums’s statement that
the parcel of land subject matter of the Deed of Extrajudicial Settlement with Waiver is
not part of the estate of Pedro Sr., their common ancestor, no other evidence was offered
to support it. The CA in giving credence to the respondents’ claim, merely relied on the
alleged typographical error in the Deed. The basis for the CA’s conclusion was the
inclusion of the wife of Pedro Jr. and that of their children, which the CA considered as
proof that the property was owned by Pedro Jr. and not part of the estate of Pedro Sr. As
pointed out by the petitioners, the mention of the names of the children of Pedro Jr. in
the Extrajudicial Settlement is not proof that the subject of the deed is the property of
Pedro Jr. Meant to exclude all the other heirs of Pedro Sr., only the children of Pedro Jr.
appeared in the Extrajudicial Settlement as heirs.

Weak as the reasoning is, the CA actually contradicted the admissions made no less by
the respondents during the pre-trial conference where they stipulated that the land
covered by Tax Declaration No. 9534 consisting of 192 sq. m belongs to Pedro Sr. 35

A portion of the admission and stipulations made by both parties during the pre-trial is
hereunder quoted, thus:

Respondents’ admissions:

"1. That the land covered by Tax Declaration No. 9534 previously owned by Pedro
Constantino, Sr. was transferred to Maria Constantino under Tax Declaration No. 9535;
(highlighting ours)

1. The existence of Extrajudicial Settlement with Waiver per Doc. No.319, Page No. 44,
Book No. 11, Series of 1968 by Notary Public Romerico Flores, Jr."

Clearly, the above stipulation is an admission against respondents’ interest of the fact of
ownership by Pedro Sr. of the 192 sq m lot covered by Tax Declaration No. 9534, which
was transferred to respondents’ mother, the daughter of Pedro Jr. Such that, in one of
the issues submitted to be resolved by the trial court, this was included: "Whether or not
the "Deed of Extrajudicial Settlement with Waiver" is enforceable against the plaintiffs,
thus curing the legal infirmities, if any, of the "Pagmamana sa Labas ng Hukuman" 36 -
an issue earlier mentioned.

Judicial admissions are legally binding on the party making the admissions. Pre-trial
admission in civil cases is one of the instances of judicial admissions explicitly provided
for under Section 7, Rule 18 of the Rules of Court, which mandates that the contents of
the pre-trial order shall control the subsequent course of the action, thereby, defining
and limiting the issues to be tried. In Bayas, et. al. v. Sandiganbayan, et. al., 37 this Court
emphasized that:

Once the stipulations are reduced into writing and signed by the parties and their
counsels, they become binding on the parties who made them. They become judicial
admissions of the fact or facts stipulated. 38 Even if placed at a disadvantageous position,
a party may not be allowed to rescind them unilaterally, it must assume the
consequences of the disadvantage.39 (Highlighting ours)

Moreover, in Alfelor v. Halasan,40 this Court declared that:

A party who judicially admits a fact cannot later challenge the fact as judicial admissions
are a waiver of proof; production of evidence is dispensed with. A judicial admission
also removes an admitted fact from the field of controversy. Consequently, an admission
made in the pleadings cannot be controverted by the party making such admission and
are conclusive as to such party, and all proofs to the contrary or inconsistent therewith
should be ignored, whether objection is interposed by the party or not. The allegations,
statements or admissions contained in a pleading are conclusive as against the pleader.
A party cannot subsequently take a position contrary of or inconsistent with what was
pleaded.41 (Citations omitted)

We are aware that the last paragraph of Section 7, Rule 18 of the Rules of Court serves as
a caveat for the rule of conclusiveness of judicial admissions - for, in the interest of
justice, issues that may arise in the course of the proceedings but which may not have
been taken up in the pre-trial can still be taken up.

Section 7, Rule 18 of the Rules of Court reads:

Section 7. Record of pre-trial. - The proceedings in the pre-trial shall be recorded. Upon

the termination thereof, the court shall issue an order which shall recite in detail the
matters taken up in the conference, the action taken thereon, the amendments allowed
to the pleadings, and the agreements or admissions made by the parties as to any of the
matters considered. Should the action proceed to trial, the order shall, explicitly define
and limit the issues to be tried. The contents of the order shall control the subsequent
course of the action, unless modified before trial to prevent injustice.

In addition, Section 4 of Rule 129 of the Rules of Court, provides that:

An admission, verbal or written, made by a party in the course of the proceedings in the
same case, does not require proof. The admission may be contradicted only by showing
that it was made through palpable mistake or that no such admission was made.

As contemplated in the aforementioned provision of the Rules of Court, the general rule
regarding conclusiveness of judicial admission upon the party making it and the
dispensation of proof admits of two exceptions: 1) when it is shown that the admission
was made through palpable mistake, and 2) when it is shown that no such admission
was in fact made. The latter exception allows one to contradict an admission by denying
that he made such an admission.42

However, respondents failed to refute the earlier admission/stipulation before and

during the trial. While denying ownership by Pedro Sr. of the 192 sq m lot, respondent
Asuncion Laquindanum, when placed on the stand, offered a vague explanation as to
how such parcel of land was acquired by Pedro Jr. A portion of her testimony 43 is hereto
reproduced as follows:

"ATTY. DOMINGO:

Q: Do you know if as part of the estate of the late Pedro Constantino, Sr. is another
parcel of land also situated at Sta. Maria, Hagonoy, Bulacan with an area of 192 square
meters?

A: It is not owned by Pedro Constantino, Sr., sir. It is our property owned by Pedro
Constantino, Jr. that was inherited by my mother Maria Constantino.

Q: And do you know how Pedro Constantino, Jr. acquired that parcel of land, the one
that you mentioned a while ago?

A: Kinagisnan ko na po yong lupang yon pagkabata pa na yon e amin." (Highlighting

ours)

The above assertion of denial is simply a self-serving declaration unsupported by

evidence. This renders conclusive the stipulations made during the pre-trial conference.
Consequently, respondents are bound by the infirmities of the contract on which they
based their right over the property subject matter thereof. Considering that the
infirmities in the two deeds relate to exclusion of heirs, a circumvention of an heir’s
right to his or her legitime, it is apt to reiterate our ruling in Neri v. Heirs of Hadji Yusop
Uy,44 disposing that:

Hence, in the execution of the Extra-Judicial Settlement of the Estate with Absolute
Deed of Sale in favour of spouses Uy, all the heirs of Annunciation should have
participated. Considering that Eutropia and Victoria were admittedly excluded and that
then minors Rosa and Douglas were not properly represented therein, the settlement
was not valid and binding upon them and consequently, a total nullity. (Highlighting
ours)
Further highlighting the effect of excluding the heirs in the settlement of estate, the case
of Segura v. Segura,45 elucidated thus:

It is clear that Section 1 of Rule 74 does not apply to the partition in question which was
null and void as far as the plaintiffs were concerned. The rule covers only partition. The
partition in the present case was invalid because it excluded six of the nine heirs who
were entitled to equal shares in the partitioned property. Under the rule "no
extrajudicial settlement shall be binding upon any person who has not participated
therein or had no notice thereof." As the partition was a total nullity and did not affect
the excluded heirs, it was not correct for the trial court to hold that their right to
challenge the partition had prescribed after two years from its execution x x x.

In light of the foregoing, while both parties acted in violation of the law on legitimes, the
pari delicto rule, expressed in the maxims "Ex dolo malo non oritur action" and "in pari
delicto potior est condition defendentis," which refuses remedy to either party to an
illegal agreement and leaves them where they are, does not apply in this case.
(Underline supplied)46 As held in De Leon v. CA:47

In the ultimate analysis, therefore, both acted in violation of laws. However, the pari
delicto rule expressed in the maxims "Ex dolo malo non oritur action" and "In pari
delicto potior est condition defendentis," which refuses remedy to either party to an
illegal agreement and leaves them where they are does not apply in this case.

x x x           x x x          x x x

Since the Letter-Agreement was repudiated before the purpose has been accomplished
and to adhere to the pari delicto rule in this case is to put a premium to the
circumvention or the laws, positive relief should be granted to Macaria. Justice would be
served by allowing her to be placed in the position in which she was before the
transaction was entered into.

Accordingly, in order not to put a premium to the circumvention or the laws as

contemplated by the parties in the instant case, we must declare both contracts as void.
Indeed, any circumvention of the law cannot be48 countenanced.

WHEREFORE, the 31 May 2007 Decision of the Court of Appeals in CA-G.R. CV No.
81329 is hereby REVERSED. The Pagmamana sa Lahas ng Hukuman and Extrajudicial
Settlement with Waiver are hereby declared void without prejudice to the partition of
the estate of Pedro Constantino Sr. with the full participation of all the latter's heirs.

SO ORDERED.

JOSE PORTUGAL PEREZ

Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 139282               September 4, 2000

ROMEO DIEGO y DE JOYA, petitioner,

vs.
The SANDIGANBAYAN and PEOPLE OF THE PHILIPPINES, respondents.

DECISION

GONZAGA-REYES, J.:

Romeo Diego Y De Joya, herein petitioner, was convicted as principal in the crime of
Malversation of Public Property by the Sandiganbayan in its Decision 1 dated February
22, 1999 in Criminal Case No. 21655. On July 7, 1999, the Sandiganbayan issued a
Resolution denying petitioner’s Motion for Reconsideration of the said decision. Hence,
this appeal by certiorari of the decision and resolution of the Sandiganbayan.

The criminal case against petitioner stems from these undisputed facts as summarized
by the Sandiganbayan, to wit:

"Accused Romeo Diego started his career in the Philippine National Police as an Auto
Mechanic way back in 1950. Through the years, he rose to the rank of Police
Superintendent (equivalent rank of Lt. Colonel). At the time of the loss of the "shabu",
the accused was the Evidence Custodian of the National Capital Region, Criminal
Investigation Service Command at Camp Crame, Quezon City. On November 27, 1992,
he received for safekeeping forty (40) self-sealed transparent plastic bags of
methamphetamine hydrochloride or "shabu" with an estimated street value of Five
Million Pesos (P5,000,000.00). As custodian of the said "shabu", he received a total of
three (3) subpoenas from Branch 111, Regional Trial Court, Pasay City, to bring the said
"shabu" as evidence in Criminal Case No. 92-2097, entitled People vs. Ong Foo de la
Cruz. The first two subpoenas were for the hearings held on January 27, 1993 and
January 29, 1993 during which police escorts accompanied the accused to help secure
the subject evidence. On these two occasions, he was accompanied by three police
officers, namely: Crime Investigator II Zosimo Escobar, SPO3 Oscar Bacani and SPO3
Isalvanor Casissid. Thus, the "shabu" was twice brought to the court but was not
presented in evidence since the hearings were postponed. In both instances, the accused
also asked Presiding Judge Sayo whether he could turn over the evidence to the custody
of the court. The latter, however, refused to accept the "shabu" for the reason that the
court did not have a vault to secure the same. In going to the Regional Trial Court at
Pasay City, the accused and his companions would leave Camp Crame at about 7:30 a.m.
and they would take EDSA to F.B. Harrison, which would lead them to the courthouse.
By virtue of the third subpoena, the accused again left his office to go to the RTC at
Pasay City with the five-and-a-half kilos (5.5 kgs.) of "shabu" on February 9, 1993, again
leaving at around 7:30 a.m. As usual, he took EDSA to F.B. Harrison towards the Pasay
City courthouse. Unlike the two previous trips to the said courthouse, however, the
accused travelled alone on that fateful day of February 9, 1993. In addition, unlike the
two other previous trips, which were uneventful, accused was waylaid by holduppers
along F.B. Harrison, about fifty (50) meters from the courthouse. The holduppers
blocked the path of accused’s Beetle and two holduppers alighted from their vehicle, a
dark blue box type Lancer with plate number PGM or PGN 44? One of the holduppers,
armed with a .45 caliber pistol, approached from the passenger side of the accused’s
vehicle and told the accused, "Huwag kang papalag. Madidisgrasya ka lang." The
holdupper then asked for accused’s ignition keys and eyeglasses, opened the passenger
door of the vehicle, grabbed the bag containing the "shabu" placed at the vehicle’s front
passenger floor. The holduppers immediately left the scene of the crime and accused
reported the incident to Judge Sayo of Branch 111 of the Regional Trial Court and to his
office at the CIS, to Major Gil Meneses, in particular. The accused then testified in court
before Judge Sayo regarding the loss of the "shabu" and immediately reported the
robbery to the Pasay City where he gave his statement (Exhibit "1") regarding the
incident on F.B. Harrison St. (sic)"2

Petitioner was charged with Malversation of Public Property in an Information that

reads:

"That on or about February 9, 1993, along F.B. Harrison St., Pasay City, Philippines, and
within the jurisdiction of this Honorable Court, the above-named accused, a public
officer being then the Evidence Custodian of the National Capital Regional Office -
PNPCIBC, and as such, by reason of his office and duties is responsible and accountable
for public funds or properties entrusted or received by him, by means of gross
negligence, did then and there wilfully (sic), unlawfully, and feloniously fail to take the
necessary precautions to adequately secure and safeguard the safe delivery of one (1)
small carton containing forty (40) self-sealed transparent plastic bags of "shabu" with
total gross weight of 5,900 grams, valued at FIVE MILLION (P5,000,000.00) PESOS,
Philippine currency, to the Court, resulting to the loss of the said ‘shabu’, to the damage
and prejudice of the Government in the aforesaid amount." 3

On February 1, 1995, before the commencement of the trial, the prosecution and the
defense entered into a Stipulation of Facts, agreeing to the following:

"1. That at all times relevant to this case, accused Romeo de Joya Diego was then
evidence custodian of the National Capital Region (NCR), Criminal Investigation Service
Command (CISC), Philippine National Police (PNP), Camp Crame, Quezon City.

2. That on November 27, 1992, accused Romeo de Joya Diego received for safekeeping
one (1) small cartoon (sic) containing forty (40) self-sealed plastic bags of ‘SHABU’ with
a street value of Five Million Pesos (5,000,000.00) (sic).

3. That on February 9, 1993 he (accused Romeo de Joya Diego) was subpoenaed to

appear and bring the subject ‘SHABU’ to Branch 111, Regional Trial Court, Pasay City.
4. That at about 7:20 A.M. February 9, 1993, before he left for the Court he sought the
assistance of SPO 3 Isalvanor Casidsid to escort him. However, the latter was not
available because he had also been subpoenaed to appear before Regional Trial Court
(sic) Mariano Umali of Pasig.

5. That accused failed to deliver the subject ‘SHABU’ before the Court on said date
(February 9, 1993) neither was it (the subject ‘SHABU’) returned to the evidence room
of the NCR, CISC, PAP, Camp Crame, Quezon City.

6. That accused testified on said date (February 9, 1993) before the RTC, Branch 111,
Pasay City, Re lost (sic) of subject ‘SHABU’."4

Trial then ensued. On March 6, 1995, the prosecution manifested that it was not
presenting any testimonial evidence and rested its case upon orally offering its exhibits.
After the prosecution had rested its case, the prosecution and defense again agreed to a
stipulation of facts, thus:

"1. That the accused Romeo Diego gave his statement marked as Exhibit 1 before SPO2
Rodolfo O. Diza on February 9, 1993, which consists of three (3) pages, 1-A being the
date of the statement and the signature being Exhibit 1-B;

2. That a Certification was issued by RTC Presiding Judge Sofronio G. Sayo on January
27, 1995 in Criminal Case No. 92-2097 entitled People of the Philippine versus Eng. Foo
de la Cruz, it being understood that the prosecution does not admit the truth of the
contents of the certification;

3. The due genuineness and due execution of Exhibit 3, together with submarkings,
which is the transcript of stenographic notes taken in Criminal Case No. 92-2097,
entitled People of the Philippines versus Eng. Foo de la Cruz, consisting of forty-two
pages."5

After the defense had presented its witnesses and exhibits, the Sandiganbayan rendered
its judgment of conviction, the dispositive portion of which reads:

"WHEREFORE, the Court hereby renders judgment finding accused Superintendent

Romeo Diego y De Joya GUILTY beyond reasonable doubt as principal in the crime of
Malversation of Public Property, as defined and penalized under paragraph 4 of Article
217 of the Revised Penal Code; and considering the mitigating circumstance of voluntary
surrender, hereby sentences the accused to suffer an indeterminate penalty of
imprisonment ranging from TEN (10) YEARS and ONE (1) DAY of prision mayor, as
minimum, to SEVENTEEN (17) YEARS, FOUR (4) MONTHS and ONE (1) DAY of
reclusion temporal, as maximum; to pay a fine of FIVE MILLION PESOS
(P5,000,000.00); to suffer the penalty of perpetual special disqualification from holding
any public office; and, to pay the costs."6

Petitioner now assails the judgment in this appeal, relying on the following grounds:
First - WHETHER OR NOT THE EVIDENCE ADDUCED BY THE PROSECUTION IN
THE PRACTICALLY REVERSE PROCEDURE OF PRESENTATION ADOPTED BY IT IS
SUFFICIENT TO PROVE THE ESSENTIAL ELEMENTS OF THE CRIME CHARGED IN
THE INFORMATION;

Second - WHETHER OR NOT, ASSUMING THAT THE BURDEN OF EVIDENCE WAS

PROPERLY SHIFTED TO PETITIONER, THE EXPLANATION HE RELIED UPON
FOR THE LOSS OF THE SUBJECT "SHABU" IS SUFFICIENT TO EXONERATE HIM
FROM LIABILITY FOR THE OFFENSE CHARGED;

Third - WHETHER OR NOT, ASSUMING WITHOUT ADMITTING, THAT

PETITIONER IS GUILTY AS CHARGED, THE SUPPOSED ESTIMATED "STREET
VALUE" OF THE SUBJECT "SHABU" IS A PROPER BASIS FOR THE ASSESSMENT
OF THE PENALTY IMPOSABLE IN THE PREMISES; and

Fourth - WHETHER OR NOT THE GUILT OF PETITIONER OF (sic) THE OFFENSE

CHARGED HAS BEEN PROVED BY EVIDENCE BEYOND REASONABLE DOUBT.7

The petition has no merit.

Petitioner contends that there was a virtual reversal of the normal order of presentation
of evidence during the trial when the Sandiganbayan required him, as accused, to put up
his defense when the prosecution rested its case relying only on its exhibits and the
stipulation of facts. However, the records of this case and the petition itself reveal that
the trial in the Sandiganbayan proceeded in the order prescribed by Rule 119, Section 3
of the Rules of Court.8 The prosecution’s reliance on the stipulation of facts and its
exhibits, without offering any testimonial evidence, is an exercise of its prosecutorial
prerogative. If petitioner truly believed that the evidence of the prosecution was
inherently weak such that it failed to establish his culpability for the crime charged, then
he should have filed a Demurrer to Evidence to dismiss the case. However, instead of
taking this course of action, petitioner entered into another stipulation of facts and
presented his evidence. Petitioner cannot now belatedly claim that the Sandiganbayan
supposedly caused the onus probandi to shift to him, the accused in a criminal case,
when petitioner himself acquiesced to the regular order of the proceedings.

Petitioner bewails the prosecution’s reliance on the stipulation of facts. It bears stress
that the stipulation of facts is a judicial admission 9 and in the absence of a showing that
"(1) the admission was made through palpable mistake", or that "(2) no such admission
was made, the admissions bind the declarant".10

In this case, petitioner duly admitted in the stipulation of facts, entered into during the
pre-trial, that the subject shabu worth five million pesos (P5,000,000.00) was in his
custody for safekeeping; that petitioner was subpoenaed to bring the shabu to Branch
111, Regional Trial Court, Pasay City Court; that petitioner failed to deliver the shabu
before said court and that neither was it returned to the evidence room. 11 The mere fact
that petitioner failed to account for the shabu under his custody raises the rebuttable
presumption that he malversed the subject shabu. Article 217 of the Revised Penal Code
states that:
"Art. 217. Malversation of public funds or property--Presumption of malversation. --
Any public officer who, by reason of the duties of his office, is accountable for public
funds or property, shall appropriate the same, or shall take or misappropriate or shall
consent, or through abandonment or negligence, shall permit any other person to take
such public funds or property, wholly or partially, or shall otherwise be guilty of the
misappropriation or malversation of such funds or property, shall suffer:

1. The penalty of prision correccional in its medium and maximum periods, if the
amount involved in the misappropriation or malversation does not exceed 200
pesos.

2. The penalty of prision mayor in its minimum and medium periods, if the
amount involved is more than 200 pesos but does not exceed 6,000 pesos.

3. The penalty of prision mayor in its maximum period to reclusion temporal in

its minimum period, if the amount involved is more than 6,000 pesos but is less
than 12,000 pesos.

4. The penalty of reclusion temporal in its medium and maximum periods, if the
amount involved is more than 12,000 pesos but is less than 22,000 pesos. If the
amount exceeds the latter, the penalty shall be reclusion temporal in its
maximum period to reclusion perpetua.

In all cases, persons guilty of malversation shall also suffer the penalty of perpetual
special disqualification and a fine equal to the amount of the funds malversed or equal
to the total value of the property embezzled.

The failure of a public officer to have duly forthcoming any public funds or property
with which his chargeable, upon demand by any duly authorized officer, shall be prima
facie evidence that he has put such missing funds or property to personal uses. (As
amended by Rep. Act No. 1060)."

The fundamental issue thus to be considered is whether or not petitioner was able to
successfully overturn the foregoing presumption. We hold that based on the testimony
of petitioner and the judicial admissions embodied in the stipulation of facts, the
presumption stands unrebutted.

All of the four elements of malversation are present in the case at bar, and these
elements are:

1. That the offender is a public officer;

2. That he has the custody or control of funds or property by reason of the duties
of his office;

3. That the funds or property are public funds or property for which he is
accountable; and
 4. That he appropriated, took, misappropriated or consented or through
abandonment or negligence, permitted another person to take them. (Emphasis
ours)12

Petitioner is a public officer who had custody of the shabu by reason of his official duties
as Evidence Custodian of the National Capital Regional Office of the Philippine National
Police - Criminal Investigation Service Command (NCRO, PNP-CISC). The shabu was
public property for which petitioner was accountable. While the evidence on record fail
to show that petitioner misappropriated said public property for his personal
aggrandizement, the evidence points to the conclusion that the loss of the shabu to
armed men was through petitioner’s negligence.

Malversation is committed either intentionally or by negligence. 13 The Sandiganbayan in

this case ruled that the loss of the shabu was due to petitioner’s gross negligence, a
factual finding that is as a rule conclusive upon this Court. 14 In cases involving public
officials, there is gross negligence when a breach of duty is flagrant and palpable. 15 What
makes petitioner’s gross negligence more pronounced is the fact that he was fully aware
of the need to transport the shabu with police escorts but despite the knowledge of the
peril involved in the transportation of illegal drugs, petitioner took it upon himself to
deliver the subject shabu without police escort, despite the fact that the shabu involved
is valued at five million pesos (P5,000,000.00), weighing 5.5 kilograms and packed in
40 sealed transparent plastic bags. The sheer nature, value, and amount of the
contraband should have alerted petitioner, an experienced evidence custodian, to the
risk that organized criminals might attempt to forcibly take away the shabu. Petitioner’s
diligence unmistakably fell short of that required by the circumstances.

We cite with approval the following findings of the Sandiganbayan:

"Indeed, the accused had miserably failed to exercise the necessary precautions to
secure the safekeeping of the "shabu" under his care. There is no doubt that the accused
was aware of the dangers posed in transporting such a large amount of "shabu" subject
of the instant case. As a matter of fact, he deemed it indispensable to secure, as he did,
the assistance of three police officers in the previous instances as escorts in transporting
the "shabu" to and from the courthouse in Pasay City. His knowledge of such dangers
was further revealed in his very own testimony before the court, thus:

J. Lagman:

Q: When you found that there was nobody to escort you, why did you not take steps to
inform the Court that you could not come considering the volume of the shabu that you
will bring to the Court and considering the enormity of the case that you are supposed to
attend?

A: My eagerness was to bring the evidence to the Court and turn it over to them because
that is dangerous.
Q: It was very dangerous for you to carry the shabu alone from your office to the Court
as you said now, is that correct? In spite of that, you took it upon yourself to bring the
shabu alone considering the danger that you said was lurking outside?

A: Yes, sir.

Undoubtedly, the danger posed of transporting the "shabu" was so real and apparent
that the accused had previously tried to turn over the same to the custody of the
Regional Trial Court in Pasay City in order that he be relieved of the burden of securing
the same. His knowledge of such danger, notwithstanding, the accused proceeded to
Pasay City without the indispensable police escorts necessary to secure the "shabu". He
failed to take the necessary steps to procure police escorts when SPO3 Isalvanor
Casidsid was unavailable. The fact that he failed to organize the requisite police escorts
on the day or days prior to the court date when he could have done so is already an
indication of the accused’s laxity in the performance of his duties. Such laxity became
even worse when he decided to proceed to Pasay City, bringing along with him the
"shabu", without police escorts. The alleged fact that he waited for thirty (30) minutes to
look for an alternate escort, without taking any further action, is insufficient to absolve
accused from liability. Neither is the accused’s fear of being cited for contempt sufficient
justification for his irresponsible actions. He certainly could explain to the judge’s
satisfaction his failure to appear in court as required.

In the case at bench, the accused could have pursued other options to ensure the
security of the "shabu". The accused would have waited until alternative escorts arrived
at the office. A simple telephone call to the office of Judge Sayo informing the latter that
the accused would be late would have sufficed. Under the circumstances, the judge
would have understood the accused’s predicament and could have called the case at a
later hour. Another option is not to have gone to the court if no escorts could be
procured. Again, a telephone call to the office of the judge would again have probably
sufficed to allay his fears of being cited for contempt. Simply put, the accused failed to
take all possible actions to ensure the security of the "shabu"; he left too many stones
unturned, so to speak.

Furthermore, the court notes that the accused carried only a gun of a mere caliber .22.
Indeed, if he were to truly secure his valuable cargo, as was his bounden duty, he should
have carried a more powerful firearm and maybe more than one such firearm, the need
therefor having become more compelling considering that he was to travel alone. It is a
matter of common experience that holduppers normally carry high powered firearms." 16

In a last ditch effort to skirt the issue of gross negligence imputed against petitioner,
petitioner claims that the robbery was a fortuitous event. This argument must likewise
fail since the loss of the shabu to armed men is by no means a fortuitous event. A
fortuitous event is defined as an occurrence which could not be foreseen or which
though foreseen, is inevitable.17 Again, the very nature of the object under the custody of
petitioner and its street value posed risks. One of these risks is that the shabu could be
taken forcibly by armed men, a risk that petitioner was in fact preparing against. The
possibility of losing the shabu to armed men was evidently a foreseeable event.
By all accounts, petitioner had previously undertaken certain measures to safeguard the
transportation of the shabu. In fact, during his first trip to the court he was accompanied
by police escorts; he suggested that the shabu be deposited with the court, which the
court denied due to the absence of a vault; petitioner tried to look for a police escort on
the day he was rescheduled to deliver the shabu in court, but allegedly to no avail; and
he decided to transport the shabu alone and incognito. Petitioner’s actions underscore
the fact that he was fully aware of the inherent danger in transporting the shabu, a fact
that defeats his claim that the loss of the shabu to armed robbers was a fortuitous event.

Concededly, the presence of police escorts would not have necessarily deterred the
robbers from taking the shabu, but in such a case, petitioner would have shown due
diligence that would controvert his own liability. True, petitioner is not expected to
match a holdupper gun for gun. However, what is simply expected of him is to exhibit a
standard of diligence commensurate with the circumstances of time, person and place.

The scale of the damage sustained by the government because of the loss of the shabu
cannot be overemphasized. The estimated street value of the shabu is five million pesos
(P5,000,000.00) and the circulation of this illegal substance in the market is a major
setback in the effort of government to curb drug addiction. We are thus in complete
agreement with the Sandiganbayan that the unnecessary risks taken by petitioner in
transporting the subject shabu, leading to the eventual loss of this prohibited substance,
cannot be countenanced.

Lastly, petitioner contends that the illegal nature of the shabu prevents the courts from
basing the penalty on its value. We hold that the Sandiganbayan did not commit a
grievous error when it imposed the penalty based on the value of the shabu. In
malversation, the penalty for the offense is dependent on the value of the public funds,
money or property malversed.18 Generally, when the value is disputed, the court is
proscribed from taking judicial notice of the value and must receive evidence of the
disputed facts with notice to the parties.19 However, in the case at bar, the value of the
shabu is not in dispute. Petitioner subscribed to the stipulation of facts that the street
value of the shabu is five million pesos (P5,000,000.00). As stated earlier, statements
embodied in the stipulation of facts are judicial admissions and are thereby binding on
the declarant. There is no indication that the admission as to the value of the shabu was
made through palpable mistake and petitioner does not deny having made such an
admission. Thus, the stipulated value of the shabu is not an improper basis for the
imposition of the penalty.20

WHEREFORE, we AFFIRM the appealed decision of the Sandiganbayan convicting the

accused Romeo Diego Y de Joya of Malversation of Public Property and imposing upon
him the indeterminate penalty of imprisonment ranging from ten (10) years and one (1)
day of prision mayor, as minimum, to seventeen (17) years, four (4) months and one (1)
day of reclusion temporal, as maximum in view of the mitigating circumstance of
voluntary surrender; to pay a fine of five million pesos (P5,000,000.00); and to suffer
the penalty of perpetual special disqualification from holding any public office.

Costs against petitioner.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 170604               September 2, 2013

HEIRS OF MARGARITA PRODON, PETITIONERS,

vs.
HEIRS OF MAXIMO S. ALVAREZ AND VALENTINA CLAVE,
REPRESENTED BY REV. MAXIMO ALVAREZ, JR., RESPONDENTS.

DECISION

BERSAMIN, J.:

The Best Evidence Rule applies only when the terms of a written document are the
subject of the inquiry. In an action for quieting of title based on the inexistence of a deed
of sale with right to repurchase that purportedly cast a cloud on the title of a property,
therefore, the Best Evidence Rule does not apply, and the defendant is not precluded
from presenting evidence other than the original document.

The Case

This appeal seeks the review and reversal of the decision promulgated on August 18,
2005,1 whereby the Court of Appeals (CA) reversed the judgment rendered on
November 5, 1997 by the Regional Trial Court (RTC), Branch 35, in Manila in Civil Case
No. 96-78481 entitled Heirs of Maximo S Alvarez and Valentina Clave, represented by
Rev. Maximo S. Alvarez and Valentina Clave, represented by Rev. Maximo Alvarez, Jr. v.
Margarita Prodon and the Register of Deeds of the City of Manila dismissing the
respondents’ action for quieting of title.2

Antecedents

In their complaint for quieting of title and damages against Margarita Prodon, 3 the
respondents averred as the plaintiffs that their parents, the late spouses Maximo S.
Alvarez, Sr. and Valentina Clave, were the registered owners of that parcel of land
covered by Transfer Certificate of Title (TCT) No. 84797 of the Register of Deeds of
Manila; that their parents had been in possession of the property during their lifetime;
that upon their parents’ deaths, they had continued the possession of the property as
heirs, paying the real property taxes due thereon; that they could not locate the owner’s
duplicate copy of TCT No. 84797, but the original copy of TCT No. 84797 on file with the
Register of Deeds of Manila was intact; that the original copy contained an entry stating
that the property had been sold to defendant Prodon subject to the right of repurchase;
and that the entry had been maliciously done by Prodon because the deed of sale with
right to repurchase covering the property did not exist. Consequently, they prayed that
the entry be cancelled, and that Prodon be adjudged liable for damages.

The entry sought to be cancelled reads:

ENTRY NO. 3816/T-84797 - SALE W/ RIGHT TO REPURCHASE IN FAVOR OF:

MARGARITA PRODON, SINGLE, FOR THE SUM OF P120,000.00, THE HEREIN
REGISTERED OWNER RESERVING FOR HIMSELF THE RIGHTS TO REPURCHASE
SAID PROPERTY FOR THE SAME AMOUNT WITHIN THE PERIOD OF SIX MONTH
(sic) FROM EXECUTION THEREOF. OTHER CONDITION SET FORTH IN (DOC. NO.
321, PAGE 66, BOOK NO. VIII OF LISEO A. RAZON, NOT.PUB. OF MANILA)

DATE OF INSTRUMENT - SEPT. 9, 1975

DATE OF INSCRIPTION - SEPT. 10, 1975,

4
AT 3:42 P.M.
In her answer,5 Prodon claimed that the late Maximo Alvarez, Sr. had executed on
September 9, 1975 the deed of sale with right to repurchase; that the deed had been
registered with the Register of Deeds and duly annotated on the title; that the late
Maximo Alvarez, Sr. had been granted six months from September 9, 1975 within which
to repurchase the property; and that she had then become the absolute owner of the
property due to its non-repurchase within the given 6-month period.

During trial, the custodian of the records of the property attested that the copy of the
deed of sale with right to repurchase could not be found in the files of the Register of
Deeds of Manila.

On November 5, 1997, the RTC rendered judgment,6 finding untenable the plaintiffs’

contention that the deed of sale with right to repurchase did not exist. It opined that
although the deed itself could not be presented as evidence in court, its contents could
nevertheless be proved by secondary evidence in accordance with Section 5, Rule 130 of
the Rules of Court, upon proof of its execution or existence and of the cause of its
unavailability being without bad faith. It found that the defendant had established the
execution and existence of the deed, to wit:

In the case under consideration, the execution and existence of the disputed deed of sale
with right to repurchase accomplished by the late Maximo Alvarez in favor of defendant
Margarita Prodon has been adequately established by reliable and trustworthy
evidences (sic). Defendant Prodon swore that on September 9, 1975 she purchased the
land covered by TCT No. 84747 (Exhibit 1) from its registered owners Maximo S.
Alvarez, Sr. and Valentina Clave (TSN, Aug. 1, 1997, pp.5-7); that the deed of sale with
right to repurchase was drawn and prepared by Notary Public Eliseo Razon (Ibid., p. 9);
and that on September 10, 1975, she registered the document in the Register of Deeds of
Manila (Ibid., pp.18-19).
The testimony of Margarita Prodon has been confirmed by the Notarial Register of
Notary Public Eliseo Razon dated September 10, 1975 (Exhibit 2), and by the Primary
Entry Book of the Register of Deeds of Manila (Exhibit 4).

Page 66 of Exhibit 2 discloses, among others, the following entries, to wit: "No. 321;
Nature of Instrument: Deed of Sale with Right to Repurchase; Name of Persons:
Maximo S. Alvarez and Valentina Alvarez (ack.); Date and Month: 9 Sept." (Exhibit 2-a).

Exhibit 4, on the other hand, also reveals the following data, to wit: ‘Number of Entry:
3816; Month, Day and Year: Sept. 10, 1975; Hour and Minute: 3:42 p.m.; Nature of
Contract: Sale with Right to Repurchase; Executed by: Maximo S. Alvarez; In favor:
Margarita Prodon; Date of Document: 9-9-75; Contract value: 120,000.’ (Exhibit 4-a).
Under these premises the Court entertains no doubt about the execution and existence
of the controverted deed of sale with right to repurchase. 7
The RTC rejected the plaintiffs’ submission that the late Maximo Alvarez, Sr. could not
have executed the deed of sale with right to repurchase because of illness and poor
eyesight from cataract. It held that there was no proof that the illness had rendered him
bedridden and immobile; and that his poor eyesight could be corrected by wearing
lenses.

The RTC concluded that the original copy of the deed of sale with right to repurchase
had been lost, and that earnest efforts had been exerted to produce it before the court. It
believed Jose Camilon’s testimony that he had handed the original to one Atty. Anacleto
Lacanilao, but that he could not anymore retrieve such original from Atty. Lacanilao
because the latter had meanwhile suffered from a heart ailment and had been
recuperating.

Ruling of the CA

On appeal, the respondents assigned the following errors, namely:

A.

THE TRIAL COURT GRAVELY ERRED IN FINDING THAT THE DUE EXECUTION
AND EXISTENCE OF THE QUESTIONED DEED OF SALE WITH RIGHT TO
REPURCHASE HAS BEEN DULY PROVED BY THE DEFENDANT.

B.

THE TRIAL COURT GRAVELY ERRED IN ADMITTING THE PIECES OF EVIDENCE

PRESENTED BY THE DEFENDANTS AS PROOFS OF THE DUE EXECUTION AND
EXISTENCE OF THE QUESTIONED DEED OF SALE WITH RIGHT TO
REPURCHASE.

C.

THE TRIAL COURT SERIOUSLY ERRED IN FINDING THAT THE QUESTIONED

DEED OF SALE WITH RIGHT TO REPURCHASE HAS BEEN LOST OR OTHERWISE
COULD NOT BE PRODUCED IN COURT WITHOUT THE FAULT OF THE
DEFENDANT.

D.

THE TRIAL COURT GRAVELY ERRED IN REJECTING THE PLAINTIFFS’ CLAIM

THAT THEIR FATHER COULD NOT HAVE EXECUTED THE QUESTIONED
DOCUMENT AT THE TIME OF ITS ALLEGED EXECUTION.8
On August 18, 2005, the CA promulgated its assailed decision, reversing the RTC, and
ruling as follows:

The case of the Department of Education Culture and Sports (DECS) v. Del Rosario in
GR No. 146586 (January 26, 2005) is instructive in resolving this issue. The said case
held:

"Secondary evidence of the contents of a document refers to evidence other than the
original document itself. A party may introduce secondary evidence of the contents of a
written instrument not only when the original is lost or destroyed, but also when it
cannot be produced in court, provided there is no bad faith on the part of the offeror.
However, a party must first satisfactorily explain the loss of the best or primary evidence
before he can resort to secondary evidence. A party must first present to the court proof
of loss or other satisfactory explanation for non-production of the original instrument.
The correct order of proof is as follows: existence, execution, loss, contents, although the
court in its discretion may change this order if necessary."

It is clear, therefore, that before secondary evidence as to the contents of a document

may be admitted in evidence, the existence of [the] document must first be proved,
likewise, its execution and its subsequent loss.

In the present case, the trial court found all three (3) prerequisites ha[ve] been
established by Margarita Prodon. This Court, however, after going through the records
of the case, believes otherwise. The Court finds that the following circumstances put
doubt on the very existence of the alleged deed of sale. Evidence on record showed that
Maximo Alvarez was hospitalized between August 23, 1975 to September 3, 1975
(Exhibit "K"). It was also established by said Exhibit "L" that Maximo Alvarez suffered
from paralysis of half of his body and blindness due to cataract. It should further be
noted that barely 6 days later, on September 15, 1975, Maximo Alvarez was again
hospitalized for the last time because he died on October of 1975 without having left the
hospital. This lends credence to plaintiffs-appellants’ assertion that their father, Maximo
Alvarez, was not physically able to personally execute the deed of sale and puts to
serious doubt [on] Jose Camilion’s testimony that Maximo Alvarez, with his wife, went
to his residence on September 5, 1975 to sell the property and that again they met on
September 9, 1975 to sign the alleged deed of sale (Exhibits "A" and "1"). The Court also
notes that from the sale in 1975 to 1996 when the case was finally filed, defendant-
appellee never tried to recover possession of the property nor had she shown that she
ever paid Real Property Tax thereon. Additionally, the Transfer Certificate of Title had
not been transferred in the name of the alleged present owner. These actions put to
doubt the validity of the claim of ownership because their actions are contrary to that
expected of legitimate owners of property.

Moreover, granting, in arguendo, that the deed of sale did exist, the fact of its loss had
not been duly established. In De Vera, et al. v Sps. Aguilar (218 SCRA 602 1993), the
Supreme Court held that after proof of the execution of the Deed it must also be
established that the said document had been lost or destroyed, thus:

"After the due execution of the document has been established, it must next be proved
that said document has been lost or destroyed. The destruction of the instrument may
be proved by any person knowing the fact. The loss may be shown by any person who
knew the fact of its loss, or by anyone who had made, in the judgment of the court, a
sufficient examination in the place or places where the document or papers of similar
character are usually kept by the person in whose custody the document lost was, and
has been unable to find it; or who has made any other investigation which is sufficient to
satisfy the court that the instrument is indeed lost.

However, all duplicates or counterparts must be accounted for before using copies. For,
since all the duplicates or multiplicates are parts of the writing itself to be proved, no
excuse for non-production of the writing itself can be regarded as established until it
appears that all of its parts are unavailable (i.e. lost, retained by the opponent or by a
third person or the like).

In the case at bar, Atty. Emiliano Ibasco, Jr., notary public who notarized the document
testified that the alleged deed of sale has about four or five original copies. Hence, all
originals must be accounted for before secondary evidence can be given of any one.
This[,] petitioners failed to do. Records show that petitioners merely accounted for three
out of four or five original copies." (218 SCRA at 607-608)

In the case at bar, Jose Camilion’s testimony showed that a copy was given to Atty.
Anacleto Lacanilao but he could not recover said copy. A perusal of the testimony does
not convince this Court that Jose Camilion had exerted sufficient effort to recover said
copy. x x x

xxxx

The foregoing testimony does not convince this Court that Jose Camilion had exerted
sufficient effort to obtain the copy which he said was with Atty. Lacanilao. It should be
noted that he never claimed that Atty. Lacanilao was already too sick to even try looking
for the copy he had. But even assuming this is to be so, Jose Camilion did not testify that
Atty. Lacanilao had no one in his office to help him find said copy. In fine, this Court
believes that the trial court erred in admitting the secondary evidence because Margarita
Prodon failed to prove the loss or destruction of the deed.

In fine, the Court finds that the secondary evidence should not have been admitted
because Margarita Prodon failed to prove the existence of the original deed of sale and
to establish its loss.
 xxxx

WHEREFORE, in view of the foregoing, the Decision of the Regional Trial Court of
Manila, Branch 35 in Civil Case No. 96-78481 is hereby REVERSED and a new one
entered ordering the cancellation of Entry No. 3816/T-84797 inscribed at the back of
TCT No. 84797 in order to remove the cloud over plaintiff-appellants’ title.

SO ORDERED.9

The heirs of Margarita Prodon (who meanwhile died on March 3, 2002) filed an
Omnibus Motion for Substitution of Defendant and for Reconsideration of the
Decision,10 wherein they alleged that the CA erred: (a) in finding that the pre-requisites
for the admission of secondary evidence had not been complied with; (b) in concluding
that the late Maximo Alvarez, Sr. had been physically incapable of personally executing
the deed of sale with right to repurchase; and (c) in blaming them for not recovering the
property, for not paying the realty taxes thereon, and for not transferring the title in
their names.

On November 22, 2005, the CA issued itsresolution, 11 allowing the substitution of the
heirs of Margarita Prodon, and denying their motion for reconsideration for its lack of
merit.

Hence, the heirs of Margarita Prodon (petitioners) have appealed to the Court through
petition for review on certiorari.

Issues

In this appeal, the petitioners submit the following as issues, namely: (a) whether the
pre-requisites for the admission of secondary evidence had been complied with; (b)
whether the late Maximo Alvarez, Sr. had been physically incapable of personally
executing the deed of sale with right to repurchase;and (c) whether Prodon’s claim of
ownership was already barred by laches.12

Ruling

The appeal has no merit.

1.

Best Evidence Rulewas not applicable herein

We focus first on an unseemly error on the part of the CA that, albeit a harmless one,
requires us to re-examine and rectify in order to carry out our essential responsibility of
educating the Bench and the Bar on the admissibility of evidence. An analysis leads us to
conclude that the CA and the RTC both misapplied the Best Evidence Rule to this case,
and their misapplication diverted the attention from the decisive issue in this action for
quieting of title. We shall endeavor to correct the error in order to turn the case to the
right track.
Section 3, Rule 130 of the Rules of Court embodies the Best Evidence

Rule, to wit:

Section 3. Original document must be produced; exceptions. — When the subject of

inquiry is the contents of a document, no evidence shall be admissible other than the
original document itself, except in the following cases:

(a) When the original has been lost or destroyed, or cannot be produced in court,
without bad faith on the part of the offeror;

(b) When the original is in the custody or under control of the party against
whom the evidence is offered, and the latter fails to produce it after reasonable
notice;

(c) When the original consists of numerous accounts or other documents which
cannot be examined in court without great loss of time and the fact sought to be
established from them is only the general result of the whole; and

(d) When the original is a public record in the custody of a public officer or is
recorded in a public office.

The Best Evidence Rule stipulates that in proving the terms of a written document the
original of the document must be produced in court. The rule excludes any evidence
other than the original writing to prove the contents thereof, unless the offeror proves:
(a) the existence or due execution of the original; (b) the loss and destruction of the
original, or the reason for its non-production in court; and (c) the absence of bad faith
on the part of the offeror to which the unavailability of the original can be attributed. 13

The primary purpose of the Best Evidence Rule is to ensure that the exact contents of a
writing are brought before the court, 14 considering that (a) the precision in presenting to
the court the exact words of the writing is of more than average importance, particularly
as respects operative or dispositive instruments, such as deeds, wills and contracts,
because a slight variation in words may mean a great difference in rights; (b) there is a
substantial hazard of inaccuracy in the human process of making a copy by handwriting
or typewriting; and (c) as respects oral testimony purporting to give from memory the
terms of a writing, there is a special risk of error, greater than in the case of attempts at
describing other situations generally. 15 The rule further acts as an insurance against
fraud.16 Verily, if a party is in the possession of the best evidence and withholds it, and
seeks to substitute inferior evidence in its place, the presumption naturally arises that
the better evidence is withheld for fraudulent purposes that its production would expose
and defeat.17 Lastly, the rule protects against misleading inferences resulting from the
intentional or unintentional introduction of selected portions of a larger set of writings. 18

But the evils of mistransmission of critical facts, fraud, and misleading inferences arise
only when the issue relates to the terms of the writing. Hence, the Best Evidence Rule
applies only when the terms of a writing are in issue. When the evidence sought to be
introduced concerns external facts, such as the existence, execution or delivery of the
writing, without reference to its terms, the Best Evidence Rule cannot be invoked. 19 In
such a case, secondary evidence may be admitted even without accounting for the
original.

This case involves an action for quieting of title, a common-law remedy for the removal
of any cloud or doubt or uncertainty on the title to real property by reason of any
instrument, record, claim, encumbrance, or proceeding that is apparently valid or
effective, but is, in truth and in fact, invalid, ineffective, voidable, or unenforceable, and
may be prejudicial to said title. In such an action, the competent court is tasked to
determine the respective rights of the complainant and other claimants to place things
in their proper place and to make the one who has no rights to said immovable respect
and not disturb the other. The action is for the benefit of both, so that he who has the
right would see every cloud of doubt over the property dissipated, and he can thereafter
fearlessly introduce any desired improvements, as well as use, and even abuse the
property. For an action to quiet title to prosper, two indispensable requisites must
concur, namely: (a) the plaintiff or complainant has a legal or an equitable title to or
interest in the real property subject of the action; and (b) the deed, claim, encumbrance,
or proceeding claimed to be casting cloud on his title must be shown to be in fact invalid
or inoperative despite its prima facie appearance of validity or legal efficacy. 20

The action for quieting of title may be based on the fact that a deed is invalid, ineffective,
voidable, or unenforceable. The terms of the writing may or may not be material to an
action for quieting of title, depending on the ground alleged by the plaintiff. For
instance, when an action for quieting of title is based on the unenforceability of a
contract for not complying with the Statute of Frauds, Article 1403 of the Civil Code
specifically provides that evidence of the agreement cannot be received without the
writing, or a secondary evidence of its contents. There is then no doubt that the Best
Evidence Rule will come into play.

It is not denied that this action does not involve the terms or contents of the deed of sale
with right to repurchase. The principal issue raised by the respondents as the plaintiffs,
which Prodon challenged head on, was whether or not the deed of sale with right to
repurchase, duly executed by the late Maximo Alvarez, Sr., had really existed. They
alleged in the complaint that:

xxxx

9. Such entry which could have been maliciously and deliberately done by the defendant
Margarita Prodon created cloud and [is] prejudicial to the title of the property subject
matter of this case, since while it is apparently valid or effective, but in truth and in fact
it is invalid, ineffective or unenforceable inasmuch that the instrument purporting to be
a Deed of Sale with right of repurchase mentioned in the said entry does not exist. 21

xxxx

On her part, Prodon specifically denied the allegation, averring in her answer that
"sometime [o]n September 9, 1975, deceased Maximo S. Alvarez lawfully entered into a
Contract of Sale with Right to Repurchase, object of which is the titled lot located at
Endaya Street, Tondo, Manila, in favor of defendant."22 In the pre-trial order, the RTC
defined the issue to be tried as "[w]hether or not the alleged document mentioned in the
said entry is existing, valid or unenforceable," 23 and did not include the terms of the
deed of sale with right to repurchase among the issues.

Apparently, the parties were fully cognizant of the issues as defined, for none of them
thereafter ventured to present evidence to establish the terms of the deed of sale with
right to repurchase. In the course of the trial, however, a question was propounded to
Prodon as to who had signed or executed the deed, and the question was objected to
based on the Best Evidence Rule. The RTC then sustained the objection. 24 At that point
began the diversion of the focus in the case. The RTC should have outrightly overruled
the objection because the fact sought to be established by the requested testimony was
the execution of the deed, not its terms. 25 Despite the fact that the terms of the writing
were not in issue, the RTC inexplicably applied the Best Evidence Rule to the case and
proceeded to determine whether the requisites for the admission of secondary evidence
had been complied with, without being clear as to what secondary evidence was sought
to be excluded. In the end, the RTC found in its judgment that Prodon had complied
with the requisites for the introduction of secondary evidence, and gave full credence to
the testimony of Jose Camilon explaining the non-production of the original. On appeal,
the CA seconded the RTC’s mistake by likewise applying the Best Evidence Rule, except
that the CA concluded differently, in that it held that Prodon had not established the
existence, execution, and loss of the original document as the pre-requisites for the
presentation of secondary evidence. Its application of the Best Evidence Rule naturally
led the CA to rule that secondary evidence should not have been admitted, but like the
RTC the CA did not state what excluded secondary evidence it was referring to.

Considering that the Best Evidence Rule was not applicable because the terms of the
deed of sale with right to repurchase were not the issue, the CA did not have to address
and determine whether the existence, execution, and loss, as pre-requisites for the
presentation of secondary evidence, had been established by Prodon’s evidence. It
should have simply addressed and determined whether or not the "existence" and
"execution" of the deed as the facts in issue had been proved by preponderance of
evidence.

Indeed, for Prodon who had the burden to prove the existence and due execution of the
deed of sale with right to repurchase, the presentation of evidence other than the
original document, like the testimonies of Prodon and Jose Camilon, the Notarial
Register of Notary Eliseo Razon, and the Primary Entry Book of the Register of Deeds,
would have sufficed even without first proving the loss or unavailability of the original of
the deed.

2.

Prodon did not preponderantly establish the existence and due execution of the deed of
sale with right to repurchase

The foregoing notwithstanding, good trial tactics still required Prodon to establish and
explain the loss of the original of the deed of sale with right to repurchase to establish
the genuineness and due execution of the deed. 26 This was because the deed, although a
collateral document, was the foundation of her defense in this action for quieting of
title.27 Her inability to produce the original logically gave rise to the need for her to
prove its existence and due execution by other means that could only be secondary
under the rules on evidence. Towards that end, however, it was not required to subject
the proof of the loss of the original to the same strict standard to which it would be
subjected had the loss or unavailability been a precondition for presenting secondary
evidence to prove the terms of a writing.

A review of the records reveals that Prodon did not adduce proof sufficient to show the
lossor explain the unavailability of the original as to justify the presentation of
secondary evidence. Camilon, one of her witnesses, testified that he had given the
original to her lawyer, Atty. Anacleto Lacanilao, but that he (Camilon) could not
anymore retrieve the original because Atty. Lacanilao had been recuperating from his
heart ailment. Such evidence without showing the inability to locate the original from
among Atty. Lacanilao’s belongings by himself or by any of his assistants or
representatives was inadequate. Moreover, a duplicate original could have been secured
from Notary Public Razon, but no effort was shown to have been exerted in that
direction.

In contrast, the records contained ample indicia of the improbability of the existence of
the deed. Camilon claimed that the late Maximo Alvarez, Sr. had twice gone to his
residence in Meycauayan, Bulacan, the first on September 5, 1975, to negotiate the sale
of the property in question, and the second on September 9, 1975, to execute the deed of
sale with right to repurchase, viz:

Do you also know the deceased plaintiff in this case, Maximo Alvarez, Sr. and his wife
Valentina Clave, Mr. Witness?

Yes, sir.

Under what circumstance were you able to know the deceased plaintiff Maximo Alvarez,
Sr. and his wife?

When they went to our house, sir.

When was this specifically?

A
Sometime the first week of September or about September 5, 1975, sir.

What was the purpose of the spouses Maximo and Valentina in meeting you on that
date?

They were selling a piece of land, sir.

xxxx

At the time when the spouses Maximo Alvarez, Sr. and Valentina Clave approached you
to sell their piece of land located at Endaya, Tondo, Manila, what document, if any, did
they show you?

The title of the land, sir.

xxxx

You said that on the first week of September or September 5, 1975 spouses Maximo and
Valentina approached you at the time, what did you tell the spouses, if any?

I asked them to come back telling them that I was going to look for a buyer, sir.

xxxx

You said that you told the spouse[s] Alvarez to just come back later and that you will
look for a buyer, what happened next, if any?

I went to see my aunt Margarita Prodon, sir.

What did you tell your aunt Margarita Prodon?

I convinced her to buy the lot.

ATTY. REAL

What was the reply of Margarita Prodon, if any?

She agreed, provided that she should meet the spouses, sir.

After Margarita Prodon told you that[,] what happened next, if any?

I waited for the spouses Alvarez to bring them to my aunt, sir.

Were you able to finally bring the spouses before Margarita Prodon?

Valentina Clave returned to our house and asked me if they can now sell the piece of
land, sir.

What did you tell Valentina Clave?

We went to the house of my aunt so she can meet her personally, sir.

And did the meeting occur?

WITNESS

Yes, sir.

ATTY. REAL

Q
What happened at the meeting?

I told Valentina Clave in front of the aunt of my wife that they, the spouses, wanted to
sell the land, sir.

What was the reply of your aunt Margarita Prodon at the time?

That Valentina Clave should come back with her husband because she was going to buy
the lot, sir.28

The foregoing testimony could not be credible for the purpose of proving the due
execution of the deed of sale with right to repurchase for three reasons.

The first is that the respondents preponderantly established that the late Maximo
Alvarez, Sr. had been in and out of the hospital around the time that the deed of sale
with right to repurchase had been supposedly executed on September 9, 1975. The
records manifested that he had been admitted to the Veterans Memorial Hospital in
Quezon City on several occasions, and had then been diagnosed with the serious
ailments or conditions, as follows:

Period of confinement Diagnosis

March 31 - May 19, 1975 • Prostatitis, chronic

• Arteriosclerotic heart disease
• Atrial fibrillation
• Congestive heart failure
• CFC III29

June 2- June 6, 1975 • Chest pains (Atrial Flutter)

• Painful urination (Chronic prostatitis)30

August 23-September 3, 1975 • Arteriosclerotic heart disease

• Congestive heart failure, mild
• Atrial fibrillation
• Cardiac functional capacity III-B31

September 15-October 2, 1975 • Arteriosclerotic heart disease

• Atrial fibrillation
• Congestive heart failure
• Pneumonia
• Urinary tract infection
• Cerebrovascular accident, old
• Upper GI bleeding probably secondary to stress
ulcers32
The medical history showing the number of very serious ailments the late Maximo
Alvarez, Sr. had been suffering from rendered it highly improbable for him to travel
from Manila all the way to Meycauayan, Bulacan, where Prodon and Camilon were then
residing in order only to negotiate and consummate the sale of the property. This high
improbability was fully confirmed by his son, Maximo, Jr., who attested that his father
had been seriously ill, and had been in and out of the hospital in 1975. 33 The medical
records revealed, too, that on September 12, 1975, or three days prior to his final
admission to the hospital, the late Maximo Alvarez, Sr. had suffered from "[h]igh grade
fever, accompanied by chills, vomiting and cough productive of whitish sticky
sputum;"had been observed to be "conscious" but "weak" and "bedridden" with his heart
having "faint" sounds, irregular rhythm, but no murmurs; and his left upper extremity
and left lower extremity had suffered 90% motor loss. 34 Truly, Prodon’s allegation that
the deed of sale with right to repurchase had been executed on September 9, 1975 could
not command belief.

The second is that the annotation on TCT No. 84797 of the deed of sale with right to
repurchase and the entry in the primary entry book of the Register of Deeds did not
themselves establish the existence of the deed. They proved at best that a document
purporting to be a deed of sale with right to repurchase had been registered with the
Register of Deeds. Verily, the registration alone of the deed was not conclusive proof of
its authenticity or its due execution by the registered owner of the property, which was
precisely the issue in this case. The explanation for this is that registration, being a
specie of notice, is simply a ministerial act by which an instrument is inscribed in the
records of the Register of Deeds and annotated on the dorsal side of the certificate of
title covering the land subject of the instrument. 35 It is relevant to mention that the law
on land registration does not require that only valid instruments be registered, because
the purpose of registration is only to give notice. 36

By the same token, the entry in the notarial register of Notary Public Razon could only
be proof that a deed of sale with right to repurchase had been notarized by him, but did
not establish the due execution of the deed.

The third is that the respondents’ remaining in the peaceful possession of the property
was further convincing evidence demonstrating that the late Maximo Alvarez, Sr. did
not execute the deed of sale with right to repurchase. Otherwise, Prodon would have
herself asserted and exercised her right to take over the property, legally and physically
speaking, upon the expiration in 1976 of the repurchase period stipulated under the
deed, including transferring the TCT in her name and paying the real property taxes due
on the properly. Her inaction was an index of the falsity of her claim against the
respondents.

In view of the foregoing circumstances, we concur with the CA that the respondents
preponderantly, proved that the deed of sale with right to repurchase executed by the
late Maximo Alvarez, Sr. did not exist in fact.

WHEREFORE, the Court AFFIRMS the decision promulgated on August 18, 2005 by
the Court of Appeals in C.A.-G.R. CV No. 58624 entitled Heirs of Maximo S. Alvarez and
Valentina Clave, represented by Rev. Maximo Alvarez, Jr. v. Margarita Prodon and the
Register of Deeds of the City Manila; and ORDERS the petitioners to pay the costs of
suit.

SO ORDERED.

LUCAS P. BERSAMIN
Associate Justice

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 150155 &nbsp &nbsp &nbsp &nbsp &nbsp &nbsp September 1,
2004

SPOUSES RAMON and FELICISIMA DIOSO, petitioners,

vs.
SPOUSES TOMAS and LEONORA CARDEÑO, respondents.

DECISION

CALLEJO, SR., J.:

Before us is a petition for review on certiorari filed by the Spouses Ramon and
Felicisima Dioso, seeking the reversal of the Court of Appeals’ Resolution 1 dated
September 28, 2001 in CA-G.R. CV No. 63265, denying their motion for
reconsideration/new trial. In the assailed resolution, the appellate court, likewise,
reiterated its Decision dated May 9, 2001 substantially affirming the decision of the
Regional Trial Court (RTC) of San Pedro, Laguna, Branch 31, dismissing the petitioners’
complaint for specific performance and/or easement of right of way.

The factual antecedents of the case are as follows:

Lot 248-A, the property subject of the complaint for specific performance and/or
easement of right of way, is one of three sublots of Lot 248 located along F.
Gomez St., Sta. Rosa, Laguna. Lot 248-A has a total area of 222 square meters
and was originally owned by Magno Eraña, the father of petitioner Felicisima
Eraña Dioso, respondent Leonora Eraña Cardeño and their other sisters, namely,
Natividad, Julieta and Encarnacion. Upon Magno Eraña’s death, Lot 248-A was
adjudicated in favor of respondent Leonora Eraña Cardeño, et al. 2

Lot 248-A was later on partitioned into two, whereby the outer portion along F. Gomez
St. became the property of the respondents, Spouses Tomas and Leonora Eraña
Cardeño. The respondents built a house thereon sometime in 1972. The interior portion
of Lot 248-A became the property of Encarnacion Eraña Javel (now deceased), one of
the sisters of respondent Leonora Cardeño and petitioner Felicisima Dioso.
Subsequently, Encarnacion sold her portion to Felicidad Legaspi who, in turn, sold the
same to the petitioners, Spouses Ramon and Felicisima Dioso.

The petitioners had also built a house of light materials on the adjacent land, Lot 248-B,
then owned by Frisco Eraña. There is an existing pathway or alley on this lot which the
petitioners use as their outlet to F. Gomez St. After they bought Encarnacion’s property,
the petitioners wanted to construct a new house at the interior portion of Lot 248-A.
They then demanded that they be given a right of way or an outlet to F. Gomez St.,
claiming that they were entitled thereto under the Pinanumpaang Salaysay executed
between respondent Leonora Cardeño and Encarnacion Javel, the petitioners’
predecessor-in-interest, on May 29, 1977. The said document states in part:

Na, kami ang siyang nagmamay-ari ng loteng may numirong 248-A na may
sukat [na] 222 square meters. Na, ang nasabing lote ay nasa tabi ng kamalig ni
G. AVEL SILVA sa daang Gov. F. Gomez ng bayang ito;

Na, ako (ENCARNACION E. JAVEL) ay pumapayag na ang nasabing lote ay

hatiin at ang harapan ng nasabing lote ay pinauubaya ko na sa aking kapatid
na si LEONORA E. CARDEÑO at ang likuran ng lote ay sa akin;

Na, ako (LEONORA E. CARDEÑO) bilang pagbibigay sa akin ng aking kapatid

(ENCARNACION E. JAVEL) na mapunta sa akin ang harapan ng nasabing lote
ay binibigyan ko naman ng daang tao sa tagiliran nitong lote upang
madaanan ng aking kapatid patungo sa likuran ng nasabing lote na kanyang
kaparte;

Dahil sa ako (LEONORA E. CARDEÑO) ay walang kaukulang salapi para

mabili ang kaparti ng aking kapatid na si ENCARNACION E. JAVEL sa
nasabing lote ay binibigyan ko siya (ENCARNACION E. JAVEL) ng karapatan
na maipagbili niya ang kanyang kaparti ng nasabing lote na may numirong
248-A na may sukat na 111 square meters.3

When the respondents refused to give them the right of way, the petitioners filed with
the RTC of San Pedro, Laguna, Branch 31, a complaint for specific performance and/or
easement of right of way with damages, docketed as Civil Case No. B-4515. The
petitioners prayed that the respondents be directed to comply with or perform their
obligation under the Pinanumpaang Salaysay and grant the petitioners a right of way,
and to pay them damages.

In their answer to the complaint, the respondents specifically denied the genuineness
and due execution of the Pinanumpaang Salaysay, alleging that it was falsified.
According to the respondents, respondent Leonora Cardeño and Encarnacion Javel
could not have claimed co-ownership over Lot 248-A to the exclusion of their other
siblings as early as 1977 when the Pinanumpaang Salaysay was supposedly executed,
because it was only on August 27, 1992 that the other siblings waived or renounced their
shares over the said property in favor of respondent Leonora Cardeño and Encarnacion
Javel. The respondents, thus, urged the trial court to dismiss the complaint.
After due proceedings, the trial court rendered its Decision 4 dated April 23, 1999 and
ruled in favor of the respondents. The trial court held that the petitioners’ evidence did
not support their claim that respondent Leonora Cardeño and Encarnacion Javel
executed the Pinanumpaang Salaysay or entered into an agreement granting the latter,
the petitioners’ predecessor-in-interest, a right of way. The trial court noted that the
petitioners presented only a photocopy or machine copy of the purported document,
and, during the trial, failed to lay the foundation or prepare the basis for the admission
of secondary evidence to prove the contents thereof. Moreover, according to the trial
court, even on the assumption that a voluntary easement of right of way existed on the
respondents’ property, the petitioners were obliged to pay them indemnity therefor.
Since the petitioners were not willing to pay such indemnity, the trial court concluded
that their action to compel the respondents to grant them a right of way must fail. The
trial court, thus, dismissed the complaint and ordered the petitioners to pay the
respondents the sum of P30,000 as attorney’s fees.

Aggrieved, the petitioners elevated the case to the Court of Appeals (CA). After
evaluation of the respective pleadings filed by the parties and the evidence on record,
the CA rendered the Decision5 dated May 9, 2001 substantially affirming that of the trial
court’s. The appellate court, however, deleted the attorney’s fees awarded in favor of the
respondents for lack of factual and legal justification.

Citing Section 3,6 Rule 130 of the Rules of Court, the CA opined that the best evidence of
the contents of a document is the original document itself; in the absence of a clear
showing that the original writing has been lost or destroyed or cannot be produced in
court, the photocopy submitted, in lieu thereof, must be disregarded, being unworthy of
any probative value and being inadmissible in evidence.

The appellate court further cited Section 57 of the same Rule and observed that the
petitioners failed to show proof as to the reasons for the unavailability of the original
copy of the Pinanumpaang Salaysay. The petitioners’ witness, Veneranda Legaspi,
merely testified that she did not know why only a photocopy of the said document was
given to her by her mother, Felicidad Legaspi, from whom the petitioners acquired the
interior one-half portion of Lot 248-A.

The CA thus affirmed the finding of the RTC that the petitioners’ claim of a right of way
had no legal basis, in view of their failure to prove the due execution of
the Pinanumpaang Salaysay under which respondent Leonora Cardeño allegedly
granted a right of way in favor of the petitioners’ predecessor-in-interest. Moreover, by
the petitioners’ refusal to pay indemnity to the respondents, the latter could not be
compelled to grant them the voluntary easement of right of way. The dispositive portion
of the appellate court’s decision reads:

WHEREFORE, foregoing premises considered and pursuant to applicable

jurisprudence and law on the matter, the decision dated April 23, 1999 of the
court a quo is AFFIRMED with modification. The award of damages and
attorney’s fees is deleted. No costs.

SO ORDERED.8
Thereafter, the petitioners filed with the appellate court a motion for
reconsideration/new trial, alleging that it erred in adopting the factual findings of the
court a quo. According to the petitioners, the CA should have made its own findings of
facts. The petitioners, likewise, submitted to the appellate court Tax Declaration No.
51637 for the year 1992 covering Lot 248-A in the name of respondent Leonora Cardeño
where, at the dorsal portion thereof, the following annotation was written:

Revision of T.D. No. 15976 based in PINANUMPAANG SALAYSAY NG

PAGHAHATI - pagbabahaging labas sa hukuman na may pagtalikod sa
kabahagi.9

The petitioners alleged that this document was newly discovered evidence, the
consideration of which could alter the outcome of the case. They also averred that the
document proved the existence of the Pinanumpaang Salaysay. In their supplement to
the motion for new trial, the petitioners additionally submitted a photocopy of
the Pinanumpaang Salaysay, this time certified by the Municipal Assessor of Sta. Rosa,
Laguna as having been verified with the original document kept by Encarnacion Javel.
The Municipal Assessor, likewise, certified that the Pinanumpaang Salaysay had been
presented to the Office of the Municipal Assessor in connection with the issuance of
respondent Leonora Cardeño’s Tax Declaration Nos. 51637 and 51638 covering Lot 248-
A. Also submitted by the petitioners was the affidavit of Magtanggol Yldeso, one of the
witnesses to the Pinanumpaang Salaysay, attesting to the circumstances surrounding
its execution and identifying the signatures appearing thereon.

However, in the assailed Resolution of September 28, 2001, the appellate court denied
the petitioners’ motion for reconsideration/new trial. In so ruling, the CA reasoned that
the documents proffered by the petitioners, i.e., Tax Declaration No. 51637, Yldeso’s
affidavit and the Municipal Assessor’s certification, could not be considered as newly
discovered evidence. According to the CA, had the petitioners exercised due diligence in
securing these documents, they could have easily been made available at the time of the
filing of the complaint or even before the case was elevated to it. The dispositive portion
of the assailed CA resolution reads:

WHEREFORE, premises above considered, the motion for reconsideration/new

trial is hereby DENIED and our May 9, 2001 Decision is REITERATED and
AFFIRMED.

SO ORDERED.10

The petitioners now seek relief from this Court, alleging that the appellate court erred in
denying their motion for reconsideration/new trial. They maintain that the CA should
have admitted in evidence the photocopy of the Pinanumpaang Salaysay which was
duly certified by the Municipal Assessor of Sta. Rosa as a faithful reproduction of the
original document. After all, according to the petitioners, this document merely
confirms the existence and due execution of the Pinanumpaang Salaysay, a photocopy
of which was already made part of the records of the proceedings in the trial court.
According to the petitioners, the fact that respondent Leonora Cardeño’s 1992 Tax
Declaration which contained the annotation on the existence of the Pinanumpaang
Salaysay was not presented as evidence during trial was excusable negligence on the
part of their former counsel. The petitioners pray that this omission be excused and that
they not be held bound thereby. Finally, the petitioners insist that they were able to
establish by secondary evidence during trial the existence of the Pinanumpaang
Salaysay and the fact of its loss or unavailability.

The preliminary issue that needs to be resolved by this Court is whether the appellate
court committed a reversible error in denying the petitioners’ motion for
reconsideration/new trial.

On this score, we affirm the ruling of the Court of Appeals.

For newly-discovered evidence to be a ground for new trial, the concurrence of the
following requisites must be established: (a) the evidence is discovered after trial; (b)
the evidence could not have been discovered and produced during trial even with the
exercise of reasonable diligence; and (c) the evidence is material and not merely
corroborative, cumulative or impeaching and is of such weight that if admitted, would
probably change the judgment.11 In order that a particular piece of evidence may be
regarded as "newly discovered" for purposes of granting a new trial, it is essential to
show that the offering party exercised reasonable diligence in seeking to locate such
evidence before or during trial, but had nonetheless failed to secure it.12

The newly discovered evidence submitted by the petitioners to the CA does not satisfy
the foregoing requisites. Respondent Leonora Cardeño’s 1992 Tax Declaration already
existed long before the petitioners filed their complaint in 1997. It must be stressed that
the said tax declaration is a public document, and as such, the petitioners could have
easily obtained a copy of the same and presented it during trial. The same holds true for
the copy of the Pinanumpaang Salaysay which was certified by the Municipal Assessor
of Sta. Rosa as a faithful reproduction of the original document kept by Encarnacion
Javel.

Thus, the petitioners failed to establish the second requisite of the rule on newly
discovered evidence. The documents belatedly submitted to the appellate court were
already in existence at the time of trial. Had they exercised reasonable diligence, the
petitioners could have discovered them and produced them during trial. Instead, they
attribute the omission to the mistake or excusable negligence of their former counsel.
Unfortunately for the petitioners, clients are generally bound by the mistakes,
negligence and omission of their counsel.13

The petitioners argue that they were able to establish the existence of the Pinanumpaang
Salaysay by secondary evidence, and the fact of the loss or unavailability of the original
copy thereof despite the non-admission of the copy certified by the municipal assessor.

Anent this issue, we rule in favor of the petitioners.

Section 3,14 Rule 130 of the Rules of Court, indeed, provides that when the subject of
inquiry is the contents of a document, no evidence shall be admissible other than the
original document itself. This rule, however, admits of exceptions, as Section 5 thereof
further states that "[W]hen the original document has been lost or destroyed, or cannot
be produced in court, the offeror, upon proof of its execution or existence and the cause
of its unavailability without bad faith on his part, may prove its contents by a copy, or by
a recital of its contents in some authentic document, or by the testimony of witnesses in
the order stated."

The admission of secondary evidence in case of the loss or unavailability of the original
document is thus warranted upon satisfactory proof of the following: (1) execution or
existence of the original; (2) loss and destruction of the original or its non-production in
court; and (3) unavailability of the original is not due to bad faith on the part of the
offeror.15 Proof of the due execution of the document and its subsequent loss would
constitute the foundation for the introduction of secondary evidence. 16

Admittedly, in this case, the original document of the Pinanumpaang Salaysay was not

presented during trial. However, the petitioners presented a photocopy thereof, as well
as testimonial evidence to prove its due execution and the loss or unavailability of the
original document. Specifically, the existence and due execution of the Pinanumpaang
Salaysay was established by Yldeso, one of the petitioners’ witnesses, who testified that
he was one of the witnesses to the execution thereof and that his signature appears
thereon:

Q Mr. Witness, on May 29, 1977, do you recall if you reported for duty?

A Yes, Sir.

Q Where did you report for duty on that day?

A Police Department of Sta. Rosa, Laguna then I went to the Office of the Mayor
as security, Sir.

Q Are you telling us that as a policeman you were likewise detailed as security of
the mayor?

A Yes, Sir, on that day.

Q Who was the mayor that you are referring to?

A Mayor Angel Tiongco, Sir.

Q He was then at that time Mayor of Sta. Rosa?

A You said that you reported on May 29, 1977 and you went to the office of the
mayor as part of your additional job as a policeman, do you recall anything
unusual that happened on that day, if you recall?

ATTY. ZARATE:
The question is very general.

COURT:

Let us see.

A Yes, Sir.

COURT:

What is that unusual incident?

A The family of Encarnacion went to me at my office at the police department,

Sir.

Q Do you consider that as [an] unusual incident?

A Yes, Ma’am. That is an unusual incident event (sic) because my grandmother

who is their Aunt told me that they will come and see (sic), Ma’am.

Q When you said they, you are referring to whom?

A Leonora Eraña and Encarnacion Eraña, Ma’am.

Q So you considered that as unusual?

A Yes, Ma’am.

ATTY. FUENTES:

Who is that godmother that you are referring to?

A Felicidad Eraña, Sir.

Q Did your godmother Felicidad tell you that the Eraña sisters is (sic) going to see
you at that time?

A Yes, Sir, that is why I considered that as [an] unusual event.

Q And what was the purpose if Felicidad told you in coming (sic) the Eraña
sisters?

A To prepare the Deed of Sale and the right of way which is located at the back,
Sir.

COURT:

At the back of what?

A At the back of Leonora (sic), Ma’am.

ATTY. FUENTES:

Did, in fact, the Eraña sisters (sic) see you on that day?

A Yes, Sir, they went there and that they had caused the preparation of [the]
Sinumpaang (sic) Salaysay relative to their agreement.

Q You mentioned the name of Leonora Eraña, do you know her?

A Yes, Sir.

Q If she is in court, will you please point to her?

A (Witness pointing to a woman inside the courtroom who when asked his (sic)
name identified her name (sic) as Leonora Eraña Cardeño).

Q You likewise mentioned the name Encarnacion Eraña?

A Yes, Sir.

Q Please look around the courtroom and point to us if she is around?

A What I know [is that] she is already dead, Sir.

Q What was the request made to you by your godmother if any why the Eraña
sisters wanted to see you on that day?

A They asked me and told me that they are going to prepare a Sinumpaang (sic)
Salaysay relative to their agreement, Sir.

Q Did your godmother tell you who were these sisters who were supposed to
prepare that document?

A Yes, Sir. Leonora and Encarnacion.

Q Do you know, if indeed, that document was prepared?

A Yes, Sir.

Q Do you know the reason why you were requested to be around in the
preparation of that document?

A My godmother asked me to accompany then (sic) that is (sic) the reason why I
accompany (sic) them, Sir.

Q To where did you accompany them?

A To the Office of the Mayor, Sir.

Q And you are referring to Mayor Tiongco?

A Yes, Sir.

Q What happened to the office of the mayor?

A The document was prepared which was signed by them in my presence, in fact,
I was a witness on that and I also signed the document, Sir.

Q Your (sic) claimed Mr. witness that you are a witness to that document, if that
document will be shown to you, will you be able to identify it?

A If my name is there I would be able to identify it, Sir.

COURT:

Show the document.

ATTY. FUENTES:

I am showing to you Mr. Yldeso a Sinumpaang (sic) Salaysay dated May 29, 1977
previously marked as Exhibit A, please go over and tell us if this is the document
you are referring to?

ATTY. ZARATE:

The witness will be incompetent, the document be[ing] presented is [a] different
document being a xerox copy.

ATTY. FUENTES:

This is a xerox copy, we admit that, Your Honor, but we are presenting that as a
secondary evidence.

ATTY. ZARATE:

Therefore, the question has no basis.

ATTY. FUENTES:

Yes, Your Honor, but the second witness we presented, it was explained.

COURT:

Well, anyway, that is not being offered yet, you just make an objection.

ATTY. ZARATE:

Yes, but we have an objection that the witness is incompetent in any identity (sic)
as to the signature would case (sic) only a suggestive device for him to identify.

COURT:
Subject to that observation. Answer.

A Yes, Sir.

ATTY. FUENTES:

You mentioned that you have your signature in this document, can you point in
this Pinanumpaang Salaysay?

ATTY. ZARATE:

General and continuing objection, Your Honor.

A (Witness is pointing to a signature below the typewritten word Nilagdaan

which [is] marked as Exhibit A for the plaintiff[s], xerox copy of Pinanumpaang
Salaysay).

ATTY. FUENTES:

When this document was prepared, do you recall if the parties therein signed or
affixed their signature[s]?

A Yes, Sir.

Q When you said yes, which parties you are (sic) referring to who signed this
document?

A Encarnacion Eraña and Leonora Eraña, Sir.

Q I am showing to you a signature over the typewritten name Encarnacion Eraña

Javel, tell us if that is the signature of Encarnacion Eraña Javel?

A Yes, Sir. They signed this in my presence but I am not ascertain (sic) if this is
the way they signed but it was in my presence.

Q Likewise, over the typewritten name Leonora Cardeño is a signature, do you

know whose signature is that?

A Yes, Sir. This is the signature of Leonora Cardeño.

Q Why do you know that this is her signature or Leonora (sic)?

A She signed in my presence, Sir.

Q Aside from you, do you recall if there are other witness who was called to be a
witness?

A Yes, Sir.
Q Who is the other witness?

A Tomas Cardeño, Sir.

Q Did you see Tomas Cardeño affix his signature in that document?

A After I signed he signed, Sir.

Q I am showing to you a signature, under your oath will you tell us if this is the
signature of Tomas Cardeño?

A Yes, Sir.

Q Can you tell us Mr. witness, where was this document executed?

A They signed that before Mayor Tiongco, Sir.

Q Do you know if Mayor Tiongco affix (sic) his signature in this document?

A Yes, Sir, that is why a copy was given to them.

Q Given copy to whom?

A To Leonora and Encarnacion, Sir.

Q Who gave Leonora and Encarnacion?

A The document was given to me by the Mayor and it was distributed to the
parties, Sir.

Q Why did you give copies to them, to Leonora and Encarnacion?

A Because they were the one[s] who executed that, so they have to receive a copy,
Sir.

Q Do you recall if Mayor Tiongco at that time subscribed or sign (sic) the
document?

A Yes, Sir.

Q Do you know where Mayor Tiongco affix (sic) his signature?

A Yes, Sir.

Q Can you point?

A (Witness pointing to a bottom part of this Exhibit A which is not legible.)

ATTY. FUENTES:
 At this point, Your Honor, we request that this document be marked, the
signatures of the witnesses, Encarnacion Javel, Leonora Cardeño, Tomas
Cardeño and that of the mayor be marked as Exhibits "A-1," "A-2," "A-3," "A-4"
and "A-5."

Q When you said Mr. witness that one of the signatory (sic) is Tomas Cardeño, do
you know him personally?

A Yes, Sir.

Q If he is inside the courtroom, will you please point to him?

A (Witness pointing to a man who when asked identified himself as Tomas Pablo
Cardeño).

ATTY. FUENTES:

That would be all for the witness, Your Honor.17

Moreover, the unavailability of the original document was established by Veneranda

Legaspi, daughter of Felicidad Legaspi, who bought Encarnacion Eraña’s portion of Lot
248-A and eventually sold it to the petitioners. She testified that they exerted efforts to
locate the original Pinanumpaang Salaysay, to no avail:

ATTY. FUENTES:

This is a certified xerox copy, can you tell us where is the original or duplicate
original of this document?

A We have exerted effort to locate the original but this is the only copy given to
me by my mother, the xerox copy, Sir.

Q Are you telling us that the one that was given to you by your mother is a xerox
copy already?

A Yes, Sir.

Q Did you not ask why that is a xerox copy?

A No, Sir.

Q And that same xerox copy that you turn over (sic) Mrs. Dioso when you sold
the property?

A Yes, Sir.

Q Did not Mrs. Dioso ask you why you turn-over (sic) this Pinanumpaang
Salaysay to her? Why this is only a xerox copy?
 ATTY. ZARATE:

Asking for opinion, Your Honor.

COURT:

Reform.

ATTY. FUENTES:

What was the reaction of Mrs. Dioso when you turn over (sic) to her this
document?

A She asked me about the original but I told her I do not know, Sir. 18

Further, the Deed of Absolute Sale dated August 13, 1984, executed between
Encarnacion Eraña Javel and Felicidad Eraña Legaspi, covering the former’s portion of
Lot 248-A, Annex "B" for the petitioners and admitted in evidence by the trial court,
expressly mentioned the Pinanumpaang Salaysay, to wit:

That my co-owner LEONORA ERAÑA-CARDEÑO being unable to buy my

aliquot share of the said property and having authorized me to sell the same to
my aunt FELICIDAD ERAÑA-LEGASPI as per written affidavit executed by me
and the said Leonora Eraña-Cardeño on May 29, 1977 at Sta. Rosa, Laguna,
subscribed before the Municipal Mayor Angel Z. Tiongco;  NOW, THEREFORE,
for and in consideration of the sum of TEN THOUSAND PESOS (P10,000.) I do
hereby sell, transfer and convey in a manner absolute my share of the above-
described property which is One Hundred Eleven (111) square meters, more or
less in the manner of partition illustrated in the said affidavit annexed hereto
forming part and parcel of this deed to be known as Annex "A"; to FELICIDAD
ERAÑA-LEGASPI, her heirs, successors-in-interest and assigns. 19

Clearly then, since there was proof of the due execution of the Pinanumpaang Salaysay,
and that, despite earnest efforts on their part, the petitioners could not produce the
original thereof, the presentation of secondary evidence to prove the contents of the said
document was justified. Furthermore, contrary to the trial court’s findings, the
petitioners had sufficiently laid down the basis for the introduction of secondary
evidence.

The rule on the admission of secondary evidence provides that the contents of the
original document may be proved (1) by a copy; (2) by a recital of its contents in some
authentic document; or (3) by the recollection of the witnesses, in the order stated. 20 The
trial court and the CA, therefore, erred in denying the admission of a photocopy of
the Pinanumpaang Salaysay,21 when the same may be properly considered as
secondary evidence to prove the contents thereof.

Interestingly, except for the perfunctory denial of the due execution of

the Pinanumpaang Salaysay contained in their answer to the complaint, the
respondents never categorically denied the existence or the presence of their signatures
thereon when they took the witness stand. In fact, when the petitioners filed their
motion for reconsideration/new trial with the CA, submitting therewith a copy of
the Pinanumpaang Salaysay, certified by the Municipal Assessor of Sta. Rosa as a
faithful reproduction of the original document kept by Encarnacion Javel, the
respondents did not refute the same. Even in their comment and memorandum filed
with this Court, the respondents did not categorically deny the existence and execution
of the said document. To the Court’s mind, this is an indication of the genuineness of
the Pinanumpaang Salaysay.

Having established the existence and due execution of the Pinanumpaang Salaysay, the
respondents are obliged to grant the petitioners, as successors-in-interest of
Encarnacion Eraña Javel, a right of way in accordance with the terms thereof. 22

WHEREFORE, the petition is GRANTED. The assailed CA Decision dated May 9,

2001 and Resolution dated September 28, 2001 in CA-G.R. CV No. 63265
are REVERSED and SET ASIDE. The respondents, Spouses Tomas and Leonora
Cardeño, are DIRECTED to grant the petitioners, Spouses Ramon and Felicisima
Dioso, an easement of right of way in accordance with the Pinanumpaang
Salaysay dated May 29, 1977.

SO ORDERED.

G.R. No. 200065

CAPITAL SHOES FACTORY, LTD., Petitioner,

- versus -

TRAVELER KIDS, INC., Respondent.

DECISION
MENDOZA, J.:

Questioned in this petition is the October 5, 2011 Decision

 of the Court of Appeals (CA), and its January 16, 2012 Resolution,
 in CA-G.R. SP No. 120413, which affirmed with modification the May 13, 2011
 and June 23, 2011
 Orders of the Regional Trial Court, Branch 170, Malabon City (RTC), regarding the
admissibility of duplicate originals as evidence in an action for sum of money and damages.
The Facts
Sometime in 2000, petitioner Capital Shoes Factory Ltd., (CSFL),a foreign corporation
engaged in the manufacturing and trading of children's shoes and similar products, and
respondent Traveller Kids, Inc. (TKI),a domestic corporation engaged in the business of
manufacturing, importing and distributing shoes, sandals and other footware entered
into an agreement, wherein they agreed that TKI would import the shoes and sandals
made by CSFL from its China factory. After TKI placed numerous purchase orders,
CSFL began manufacturing the goods pursuant to the special designs and specifications
of TKI. CSFL then shipped the goods to TKI. It was their arrangement that TKI would
pay thirty (30%) percent of the purchase price of the goods by way of letters of credit,
and the balance of seventy (70%) percent by way of telegraphic transfer, thirty (30) days
from the date of delivery of the goods.

For the first three years, TKI was able to pay its purchase orders and the shipments
made by CSFL. In 2004, however, TKI started to default in its payments. CSFL granted
numerous concessions and extensions to TKI. Thereafter, TKI was able to make a partial
payment on its unpaid accounts.

As of July 10, 2005, the total unpaid accounts of TKI amounted to U.S. $325,451.39,
exclusive of the interest accruing thereto. In addition, CSFL also manufactured
$92,000.00 worth of children's shoes and sandals pursuant to the design and
specifications of TKI in its purchase orders.

Both verbal and written demand letters were made by CSFL to TKI for the payment of
its unpaid accounts, but to no avail.

To protect its interest, CSFL filed a complaint for collection of sum of money and
damages against TKI beforethe RTC. During the trial, CSFL, through its witness,
identified several sales invoices and order slips it issued as evidence of its transactions
withTKI. The latter objected to the identification pointing out that the documents being
presented were mere photocopies. TKI also objected to the evidence presented by CSFL
to prove the amount of attorney’s fees on the ground that it was not an issue raised
during the pre-trial. The RTC noted the objections.

After the presentation of its last witness, CSFL filed its Formal Offer of Exhibits

 seeking the admission of, among others, the sales invoices and order slips earlier objected to by
TKI. The latter objected to the admission of the documents offered, contending thatseveral of the
sales invoices and order slips should not be admitted because they were merely photocopies. TKI
also objected to the admission ofdocuments by which CSFL sought to prove its claim for
attorney’s fees.
On May 13, 2011, the RTC issued the Order

 admitting all the exhibits offered by CFSL. The Order reads:

ORDER
Acting on Plaintiff’s Formal Offer of Exhibits as well as Defendant’s
Comment/Opposition on/thereto and finding the said offer to be well-taken and in
order - despite the objections made to the admission of said exhibits by defendant,
Exhibits "A" to ZZZ-1-A," inclusive, are all admittedfor the purposes for which the same
are offered and as part of the testimony of the witness who testified thereon.

Let the presentation of defendant’s evidence commence on May 25, 2011 at 8:30 o’clock
inthe morning, as previously scheduled.

SO ORDERED. [Emphasis supplied]

Not in conformity, TKI filed a motion for reconsideration

 arguing that the exhibits formally offered by CSFL were inadmissible in evidence for being
mere photocopies. TKI also argued that the evidence relating to the claimed "legal fees" were
erroneously admitted because the matter was not raised as an issue during the pre-trial.
On June 23, 2011, the RTC issued the order

 denying TKI’s motion for reconsideration, ruling that the sales invoices and order slips could be
admitted because the duplicate originals of the invoices were already sufficiently established by
the testimony of CSFL’s officer and principal witness, Ms. Susan Chiu (Chiu). Regarding the
documents offered by CSFL to prove its claim for attorney’s fees, the RTC stated that the
demand for attorney’s fees was impliedly included in the issue of whether or not TKI was liable
to CSFL for the entire amount claimed.
Instead of presenting evidence, TKI opted to file a petition for certiorariwith prayer for
Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction before the
CAin which it reiterated its argument regarding the inadmissibility of the photocopied
evidence and the erroneous inclusion of those documents proving entitlement to
attorney’s fees which matter was not raised during the pre-trial.

As there was no injunction order issued by the CA, the RTC continued the proceedings
and directed TKI to present evidence. TKI refused, citing the petition for certiorari it
filed with the CA. Because of its refusal, the RTC considered TKI’s right to adduce
countervailing evidence as waived and ordered CSFLto submit its memorandum.

On October 5, 2011, the CA rendered a decision partially granting TKI’s petition. The
dispositive portion of which reads:

WHEREFORE, premises considered, the Petition for Certiorari is PARTIALLY

GRANTED. Accordingly, the assailed Orders dated May 13, 2011 and June23, 2011 of
public respondent judge are hereby AFFIRMED with the modification that Exhibits "D"
to "GG-1" and "HH" to "KK-1" should be denied admission for being merely
photocopies. As such, they are inadmissible for failure of private respondent to prove
any of the exceptions provided under Section 3, Rule 130 of the Rules of Court.

SO ORDERED.

[Underscoring supplied]

Applying Section 3, Rule 130 of the Rules of Court,

 the CA explained that while it was true that the original copies of the sales invoices were the
best evidence to prove TKI’sobligation, CSFL merely presented photocopies of the questioned
exhibits. It stated that Chiu’s testimony merely established the existence or due execution of the
original invoices. CSFL, however, did not present the original invoices, only the photocopies,
contrary to Section 5, Rule 130 of the Rules of Court.
 Nonetheless, the CA agreed with the RTC’s admission of CSFL’s evidence proving attorney’s
fees, quoting verbatim its logic and reasoning.
CSFL filed a motion for partial reconsideration, but it was denied by the CA in its
Resolution, dated January 16, 2012.

Hence, this petition.

GROUND
THE COURT OF APPEALS GRAVELY ERRED IN DELVING INTO THE LOWER
COURT’S EVALUATION OF EVIDENCE AND FACTUAL FINDINGS SINCE IT IS
BEYOND THE VERY LIMITED JURISDICTIONAL PARAMETERS OF A CERTIORARI
PROCEEDING, THATIS, THE CORRECTION OF ERRORS OF JURISDICTION.
Stripped of non-essentials, the only issue to be resolved is whether or not the CA
correctly modified the RTC order admitting the exhibits offered by CSFL.

CSFL basically argues that the excluded documents are admissible in evidence because
it was duly established during the trial that the said documents were duplicate originals,
and not mere photocopies, considering that they were prepared at the same time as the
originals.

On the other hand, TKI counters that CSFL’s claim that the photocopied documents
were duplicate originals was just a unilateral and self-serving statement without any
supportive evidence.

The Court’s Ruling

The Court finds merit in the petition.

After a review of the RTC and the CA records, which were ordered elevated, the Court is
ofthe considered view that the CA erred in not admitting the invoices and order slips
denominated as Exhibits "D" to "GG-1" and "HH" to "KK-1," which were duplicate
originals. Section 4(b), Rule 130 of the Rules of Court reads:

Sec. 4 . Original of document. —

xxxx
(b) When a document is in two or more copies executed at or about the same time, with
identical contents, all such copies are equally regarded as originals.

xxxx
In Trans-Pacific Industrial Supplies v. The Court of Appeals and Associated Bank,

 it was stressed that duplicate originals were admissible as evidence. Pertinent portions of the
said decision read:
Respondent court is of the viewthat the above provision must be construed to mean the
original copy of the document evidencing the credit and not its duplicate, thus:

. . . [W]hen the law speaksof the delivery of the private document evidencing a credit, it
must be construed as referring to the original. In this case, appellees (Trans-Pacific)
presented, not the originals but the duplicates of the three promissory notes." (Rollo, p.
42)

The above pronouncement of respondent court is manifestly groundless.It is undisputed

that the documents presented were duplicate originals and are therefore admissible as
evidence. Further, it must be noted that respondent bank itself did not bother to
challenge the authenticity of the duplicate copies submitted by petitioner. In People vs.
Tan, (105 Phil. 1242 [1959]),we said:

When carbon sheets are inserted between two or more sheets of writing paper so that
the writing of a contract upon the outside sheet, including the signature of the party to
be charged thereby, produces a facsimile upon the sheets beneath, such signature being
thus reproduced by the same stroke of pen which made the surface or exposed
impression, all of the sheets so written on are regarded as duplicate originals and either
of them may be introduced in evidence as such without accounting for the
nonproduction of the others.

[Emphases supplied]

Records reveal that Chiu, CSFL’s principal witness, was able to satisfactorily explain that
Exhibits "D" to "GG-1" and "HH" to "KK-1" were duplicate originals of invoicesand order
slips, and not mere photocopies. She testified as follows:

Atty. Fernandez:

Q The documents that you have brought today, to what records do they belong?

A Those originals are from our company because one copy was sent to the customer and
one we keep in our company, Sir.

Q When you prepare a particular invoice pertaining to a particular transaction Miss

Witness, how many copies do you prepare for that invoice? How many copies of the
invoice will you prepare?

A Two sets of invoice, one to the customer and one for our office sir.

Q And the copies that you brought today, are those the ones that were retained to you
inyour office, the copies you brought to court?

A Yes sir.
[Emphases supplied]

The transcripts of stenographic notes (TSNs) clearly show that Chiu convincingly
explained that CSFL usually prepared two (2) copies of invoices for a particular
transaction, giving one copy to a client and retaining the other copy. The Court combed
through her testimony and found nothing that would indicate that the
documentsoffered were mere photocopies. She remained firm and consistent with her
statement that the subject invoices were duplicate originals as they were prepared at the
same time. The Court sees no reason why Section 4(b), Rule 130 of the Rules of Court
should not apply. At any rate, those exhibits can be admitted as part of the testimony of
Chiu.

The Court went over the RTC records and the TSNs and found that, contrary to the
assertion of TKI, the duplicate originals were produced in court and compared with
their photocopies during the hearing before the trial court. The transcripts bare all of
these but were missed by the appellate court, which believed the assertion of TKI that
what were produced in court and offered in evidence were mere photocopies. The TSNs
further reveal that after the comparison, the photocopies were the ones retained in the
records.

The Court notes that this case involves a foreign entity and has been pending since
October 6, 2005.

 It is about time that this case be decided on the merits. At this juncture, the Court reminds
counsel for TKI of his duty, as an officer of the court, to see to it that the orderly administration
of justice be not unduly impeded.
After the admission of CSFL’s exhibits as evidence, TKI should have let trial proceed in
due course instead of immediately resorting to certiorari, by presenting its own
testimonial and documentary evidence and in case of an unfavorable decision, appeal
the same in accordance with law. After all, the RTC stated that, granting that the
questioned exhibits were not admissible, "there still remained enough evidence to
substantiate plaintiff’s claim on which the Court can validly render judgment upon
application of the pertinent law and/or jurisprudence."

 In the case of Johnson Lee v. People of the Philippines,

 it was written:
In this case, there is no dispute that the RTC had jurisdiction over the cases filed by the
public respondent against the petitioner for estafa. The Order admitting in evidence the
photocopies of the charge invoices and checks was issued by the RTC in the exercise of
its "jurisdiction. Even if erroneous, the same is a mere error of judgment and not of
jurisdiction. Additionally, the admission of secondary evidence in lieu of the original
copies predicated on proof of the offeror of the conditions sine qua non to the admission
of the said evidence is a factual issue addressed to the sound discretion of the trial
court. Unless grave abuse of discretion amounting to excess or lack of jurisdiction is
shown to have been committed by the trial court, the resolution of the trial court
admitting secondary evidence must be sustained. The remedy of the petitioner, after the
admission of the photocopies of the charge invoices and the checks, was to adduce his
evidence, and if after trial, he is convicted, to appeal the decision to the appropriate
appellate court. Moreover, under Rule 45 of the Rules of Court, as amended, only
questions of law may be properly raised.

[Emphases supplied]

WHERE FORE, the October 5, 2011 Decision and the January 16, 20 i 2 Resoiution of
the Court of Appeais in CA-G.R. SP No. i 204 i 3, are hereby REVERSED and SET
ASIDE insofar as the exclusion of Exhibits ''D" to "GG-1" and "HH'' to "KK-1 '' are
concerned. The May 13, 2011 Order of the Regional Trial Court, Branch 170, Malabon
City, is REINSTATED.

The pertinent records of the case are hereby ordered remanded to the Regional Trial
Court, Branch 170, Malabon City, for appropriate proceedings.

The trial court is directed to give priority to this case and act on it with dispatch.

SO ORDERED.

JOSE CATRAL MENDOZA

Associate Justice

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 170633             October 17, 2007

MCC INDUSTRIAL SALES CORPORATION, petitioner,

vs.
SSANGYONG CORPORATION, respondents.

DECISION

NACHURA, J.:

Before the Court is a petition for review on certiorari of the Decision1 of the Court of
Appeals in CA-G.R. CV No. 82983 and its Resolution 2 denying the motion for
reconsideration thereof.

Petitioner MCC Industrial Sales (MCC), a domestic corporation with office at Binondo,
Manila, is engaged in the business of importing and wholesaling stainless steel
products.3 One of its suppliers is the Ssangyong Corporation (Ssangyong), 4 an
international trading company5 with head office in Seoul, South Korea and regional
headquarters in Makati City, Philippines.6 The two corporations conducted business
through telephone calls and facsimile or telecopy transmissions. 7 Ssangyong would send
the pro forma invoices containing the details of the steel product order to MCC; if the
latter conforms thereto, its representative affixes his signature on the faxed copy and
sends it back to Ssangyong, again by fax.8

On April 13, 2000, Ssangyong Manila Office sent, by fax, a letter 9 addressed to Gregory
Chan, MCC Manager [also the President10 of Sanyo Seiki Stainless Steel Corporation], to
confirm MCC's and Sanyo Seiki's order of 220 metric tons (MT) of hot rolled stainless
steel under a preferential rate of US$1,860.00 per MT. Chan, on behalf of the
corporations, assented and affixed his signature on the conforme portion of the letter.11

On April 17, 2000, Ssangyong forwarded to MCC Pro Forma Invoice No. ST2-

POSTSO40112 containing the terms and conditions of the transaction. MCC sent back
by fax to Ssangyong the invoice bearing the conformity signature 13 of Chan. As stated in
the pro forma invoice, payment for the ordered steel products would be made through
an irrevocable letter of credit (L/C) at sight in favor of Ssangyong. 14 Following their
usual practice, delivery of the goods was to be made after the L/C had been opened.

In the meantime, because of its confirmed transaction with MCC, Ssangyong placed the
order with its steel manufacturer, Pohang Iron and Steel Corporation (POSCO), in South
Korea15 and paid the same in full.

Because MCC could open only a partial letter of credit, the order for 220MT of steel was
split into two,16 one for 110MT covered by Pro Forma Invoice No. ST2-POSTS0401-
117 and another for 110MT covered by ST2-POSTS0401-2,18 both dated April 17, 2000.

On June 20, 2000, Ssangyong, through its Manila Office, informed Sanyo Seiki and
Chan, by way of a fax transmittal, that it was ready to ship 193.597MT of stainless steel
from Korea to the Philippines. It requested that the opening of the L/C be
facilitated.19 Chan affixed his signature on the fax transmittal and returned the same, by
fax, to Ssangyong.20

Two days later, on June 22, 2000, Ssangyong Manila Office informed Sanyo Seiki, thru
Chan, that it was able to secure a US$30/MT price adjustment on the contracted price
of US$1,860.00/MT for the 200MT stainless steel, and that the goods were to be
shipped in two tranches, the first 100MT on that day and the second 100MT not later
than June 27, 2000. Ssangyong reiterated its request for the facilitation of the L/C's
opening.21

Ssangyong later, through its Manila Office, sent a letter, on June 26, 2000, to the
Treasury Group of Sanyo Seiki that it was looking forward to receiving the L/C details
and a cable copy thereof that day. 22 Ssangyong sent a separate letter of the same date to
Sanyo Seiki requesting for the opening of the L/C covering payment of the first 100MT
not later than June 28, 2000.23 Similar letters were transmitted by Ssangyong Manila
Office on June 27, 2000.24 On June 28, 2000, Ssangyong sent another facsimile letter to
MCC stating that its principal in Korea was already in a difficult situation 25 because of
the failure of Sanyo Seiki and MCC to open the L/C's.
The following day, June 29, 2000, Ssangyong received, by fax, a letter signed by Chan,
requesting an extension of time to open the L/C because MCC's credit line with the bank
had been fully availed of in connection with another transaction, and MCC was waiting
for an additional credit line.26 On the same date, Ssangyong replied, requesting that it be
informed of the date when the L/C would be opened, preferably at the earliest possible
time, since its Steel Team 2 in Korea was having problems and Ssangyong was incurring
warehousing costs.27 To maintain their good business relationship and to support MCC
in its financial predicament, Ssangyong offered to negotiate with its steel manufacturer,
POSCO, another US$20/MT discount on the price of the stainless steel ordered. This
was intimated in Ssangyong's June 30, 2000 letter to MCC. 28 On July 6, 2000, another
follow-up letter29 for the opening of the L/C was sent by Ssangyong to MCC.

However, despite Ssangyong's letters, MCC failed to open a letter of

credit.30 Consequently, on August 15, 2000, Ssangyong, through counsel, wrote Sanyo
Seiki that if the L/C's were not opened, Ssangyong would be compelled to cancel the
contract and hold MCC liable for damages for breach thereof amounting to
US$96,132.18, inclusive of warehouse expenses, related interests and charges. 31

Later, Pro Forma Invoice Nos. ST2-POSTS080-132 and ST2-POSTS080-233 dated

August 16, 2000 were issued by Ssangyong and sent via fax to MCC. The invoices
slightly varied the terms of the earlier pro forma invoices (ST2-POSTSO401, ST2-
POSTS0401-1 and ST2-POSTS0401-2), in that the quantity was now
officially 100MT per invoice and the price was reduced to US$1,700.00 per MT. As
can be gleaned from the photocopies of the said August 16, 2000 invoices submitted to
the court, they both bear the conformity signature of MCC Manager Chan.

On August 17, 2000, MCC finally opened an L/C with PCIBank for US$170,000.00
covering payment for 100MT of stainless steel coil under Pro Forma Invoice No. ST2-
POSTS080-2.34 The goods covered by the said invoice were then shipped to and
received by MCC.35

MCC then faxed to Ssangyong a letter dated August 22, 2000 signed by Chan,
requesting for a price adjustment of the order stated in Pro Forma Invoice No. ST2-
POSTS080-1, considering that the prevailing price of steel at that time was
US$1,500.00/MT, and that MCC lost a lot of money due to a recent strike. 36

Ssangyong rejected the request, and, on August 23, 2000, sent a demand letter 37 to Chan
for the opening of the second and last L/C of US$170,000.00 with a warning that, if the
said L/C was not opened by MCC on August 26, 2000, Ssangyong would be constrained
to cancel the contract and hold MCC liable for US$64,066.99 (representing cost
difference, warehousing expenses, interests and charges as of August 15, 2000) and
other damages for breach. Chan failed to reply.

Exasperated, Ssangyong through counsel wrote a letter to MCC, on September 11, 2000,
canceling the sales contract under ST2-POSTS0401-1 /ST2-POSTS0401-2, and
demanding payment of US$97,317.37 representing losses, warehousing expenses,
interests and charges.38
Ssangyong then filed, on November 16, 2001, a civil action for damages due to breach of
contract against defendants MCC, Sanyo Seiki and Gregory Chan before the Regional
Trial Court of Makati City. In its complaint,39 Ssangyong alleged that defendants
breached their contract when they refused to open the L/C in the amount of
US$170,000.00 for the remaining 100MT of steel under Pro Forma Invoice Nos. ST2-
POSTS0401-1 and ST2-POSTS0401-2.

After Ssangyong rested its case, defendants filed a Demurrer to Evidence 40 alleging that
Ssangyong failed to present the original copies of the pro forma invoices on which the
civil action was based. In an Order dated April 24, 2003, the court denied the demurrer,
ruling that the documentary evidence presented had already been admitted in the
December 16, 2002 Order41 and their admissibility finds support in Republic Act (R.A.)
No. 8792, otherwise known as the Electronic Commerce Act of 2000. Considering that
both testimonial and documentary evidence tended to substantiate the material
allegations in the complaint, Ssangyong's evidence sufficed for purposes of a prima facie
case.42

After trial on the merits, the RTC rendered its Decision 43 on March 24, 2004, in favor of
Ssangyong. The trial court ruled that when plaintiff agreed to sell and defendants agreed
to buy the 220MT of steel products for the price of US$1,860 per MT, the contract was
perfected. The subject transaction was evidenced by Pro Forma Invoice Nos. ST2-
POSTS0401-1 and ST2-POSTS0401-2, which were later amended only in terms of
reduction of volume as well as the price per MT, following Pro Forma Invoice Nos. ST2-
POSTS080-1 and ST2-POSTS080-2. The RTC, however, excluded Sanyo Seiki from
liability for lack of competent evidence. The fallo of the decision reads:

WHEREFORE, premises considered, Judgment is hereby rendered ordering

defendants MCC Industrial Sales Corporation and Gregory Chan, to pay plaintiff,
jointly and severally the following:

1) Actual damages of US$93,493.87 representing the outstanding principal claim

plus interest at the rate of 6% per annum from March 30, 2001.

2) Attorney's fees in the sum of P50,000.00 plus P2,000.00 per counsel's

appearance in court, the same being deemed just and equitable considering that
by reason of defendants' breach of their obligation under the subject contract,
plaintiff was constrained to litigate to enforce its rights and recover for the
damages it sustained, and therefore had to engage the services of a lawyer.

3) Costs of suit.

No award of exemplary damages for lack of sufficient basis.

SO ORDERED.44

On April 22, 2004, MCC and Chan, through their counsel of record, Atty. Eladio B.
Samson, filed their Notice of Appeal. 45 On June 8, 2004, the law office of Castillo
Zamora & Poblador entered its appearance as their collaborating counsel.
In their Appeal Brief filed on March 9, 2005, 46 MCC and Chan raised before the CA the
following errors of the RTC:

I. THE HONORABLE COURT A QUO PLAINLY ERRED IN FINDING THAT

APPELLANTS VIOLATED THEIR CONTRACT WITH APPELLEE

A. THE HONORABLE COURT A QUO PLAINLY ERRED IN FINDING

THAT APPELLANTS AGREED TO PURCHASE 200 METRIC TONS OF
STEEL PRODUCTS FROM APPELLEE, INSTEAD OF ONLY 100 METRIC
TONS.

1. THE HONORABLE COURT A QUO PLAINLY ERRED IN

ADMITTING IN EVIDENCE THE PRO FORMA INVOICES WITH
REFERENCE NOS. ST2- POSTS0401-1 AND ST2-POSTS0401-2.

II. THE HONORABLE COURT A QUO PLAINLY ERRED IN AWARDING

ACTUAL DAMAGES TO APPELLEE.

III. THE HONORABLE COURT A QUO PLAINLY ERRED IN AWARDING

ATTORNEY'S FEES TO APPELLEE.

IV. THE HONORABLE COURT A QUO PLAINLY ERRED IN FINDING

APPELLANT GREGORY CHAN JOINTLY AND SEVERALLY LIABLE WITH
APPELLANT MCC.47

On August 31, 2005, the CA rendered its Decision 48 affirming the ruling of the trial
court, but absolving Chan of any liability. The appellate court ruled, among others, that
Pro Forma Invoice Nos. ST2-POSTS0401-1 and ST2-POSTS0401-2 (Exhibits "E",
"E-1" and "F") were admissible in evidence, although they were mere facsimile printouts
of MCC's steel orders.49 The dispositive portion of the appellate court's decision reads:

WHEREFORE, premises considered, the Court holds:

(1) The award of actual damages, with interest, attorney's fees and costs ordered
by the lower court is hereby AFFIRMED.

(2) Appellant Gregory Chan is hereby ABSOLVED from any liability.

SO ORDERED.50

A copy of the said Decision was received by MCC's and Chan's principal counsel, Atty.
Eladio B. Samson, on September 14, 2005.51 Their collaborating counsel, Castillo
Zamora & Poblador,52 likewise, received a copy of the CA decision on September 19,
2005.53

On October 4, 2005, Castillo Zamora & Poblador, on behalf of MCC, filed a motion for
reconsideration of the said decision. 54 Ssangyong opposed the motion contending that
the decision of the CA had become final and executory on account of the failure of MCC
to file the said motion within the reglementary period. The appellate court resolved, on
November 22, 2005, to deny the motion on its merits, 55 without, however, ruling on the
procedural issue raised.

Aggrieved, MCC filed a petition for review on certiorari56 before this Court, imputing the
following errors to the Court of Appeals:

THE COURT OF APPEALS DECIDED A LEGAL QUESTION NOT IN

ACCORDANCE WITH JURISPRUDENCE AND SANCTIONED A DEPARTURE
FROM THE USUAL AND ACCEPTED COURSE OF JUDICIAL PROCEEDINGS
BY REVERSING THE COURT A QUO'S DISMISSAL OF THE COMPLAINT IN
CIVIL CASE NO. 02-124 CONSIDERING THAT:

I. THE COURT OF APPEALS ERRED IN SUSTAINING THE

ADMISSIBILITY IN EVIDENCE OF THE PRO-FORMA INVOICES WITH
REFERENCE NOS. ST2-POSTSO401-1 AND ST2-POSTSO401-2,
DESPITE THE FACT THAT THE SAME WERE MERE PHOTOCOPIES
OF FACSIMILE PRINTOUTS.

II. THE COURT OF APPEALS FAILED TO APPRECIATE THE OBVIOUS

FACT THAT, EVEN ASSUMING PETITIONER BREACHED THE
SUPPOSED CONTRACT, THE FACT IS THAT PETITIONER FAILED TO
PROVE THAT IT SUFFERED ANY DAMAGES AND THE AMOUNT
THEREOF.

III. THE AWARD OF ACTUAL DAMAGES IN THE AMOUNT OF

US$93,493.87 IS SIMPLY UNCONSCIONABLE AND SHOULD HAVE
BEEN AT LEAST REDUCED, IF NOT DELETED BY THE COURT OF
APPEALS.57

In its Comment, Ssangyong sought the dismissal of the petition, raising the following
arguments: that the CA decision dated 15 August 2005 is already final and executory,
because MCC's motion for reconsideration was filed beyond the reglementary period of
15 days from receipt of a copy thereof, and that, in any case, it was a pro forma motion;
that MCC breached the contract for the purchase of the steel products when it failed to
open the required letter of credit; that the printout copies and/or photocopies of
facsimile or telecopy transmissions were properly admitted by the trial court because
they are considered original documents under R.A. No. 8792; and that MCC is liable for
actual damages and attorney's fees because of its breach, thus, compelling Ssangyong to
litigate.

The principal issues that this Court is called upon to resolve are the following:

I - Whether the CA decision dated 15 August 2005 is already final and executory;

II - Whether the print-out and/or photocopies of facsimile transmissions are electronic

evidence and admissible as such;
III - Whether there was a perfected contract of sale between MCC and Ssangyong, and, if
in the affirmative, whether MCC breached the said contract; and

IV - Whether the award of actual damages and attorney's fees in favor of Ssangyong is
proper and justified.

-I-

It cannot be gainsaid that in Albano v. Court of Appeals,58 we held that receipt of a copy
of the decision by one of several counsels on record is notice to all, and the period to
appeal commences on such date even if the other counsel has not yet received a copy of
the decision. In this case, when Atty. Samson received a copy of the CA decision on
September 14, 2005, MCC had only fifteen (15) days within which to file a motion for
reconsideration conformably with Section 1, Rule 52 of the Rules of Court, or to file a
petition for review on certiorari in accordance with Section 2, Rule 45. The period
should not be reckoned from September 29, 2005 (when Castillo Zamora & Poblador
received their copy of the decision) because notice to Atty. Samson is deemed notice to
collaborating counsel.

We note, however, from the records of the CA, that it was Castillo Zamora & Poblador,
not Atty. Samson, which filed both MCC's and Chan's Brief and Reply Brief. Apparently,
the arrangement between the two counsels was for the collaborating, not the principal,
counsel to file the appeal brief and subsequent pleadings in the CA. This explains why it
was Castillo Zamora & Poblador which filed the motion for the reconsideration of the CA
decision, and they did so on October 5, 2005, well within the 15-day period from
September 29, 2005, when they received their copy of the CA decision. This could also
be the reason why the CA did not find it necessary to resolve the question of the
timeliness of petitioner's motion for reconsideration, even as the CA denied the same.

Independent of this consideration though, this Court assiduously reviewed the records
and found that strong concerns of substantial justice warrant the relaxation of this rule.

In Philippine Ports Authority v. Sargasso Construction and Development

Corporation,59 we ruled that:

In Orata v. Intermediate Appellate Court, we held that where strong

considerations of substantive justice are manifest in the petition, this Court may
relax the strict application of the rules of procedure in the exercise of its legal
jurisdiction. In addition to the basic merits of the main case, such a petition
usually embodies justifying circumstance which warrants our heeding to the
petitioner's cry for justice in spite of the earlier negligence of counsel. As we held
in Obut v. Court of Appeals:

[W]e cannot look with favor on a course of action which would place the
administration of justice in a straight jacket for then the result would be a
poor kind of justice if there would be justice at all. Verily, judicial orders,
such as the one subject of this petition, are issued to be obeyed,
nonetheless a non-compliance is to be dealt with as the circumstances
 attending the case may warrant. What should guide judicial action is the
principle that a party-litigant is to be given the fullest opportunity to
establish the merits of his complaint or defense rather than for him to lose
life, liberty, honor or property on technicalities.

The rules of procedure are used only to secure and not override or frustrate
justice. A six-day delay in the perfection of the appeal, as in this case, does not
warrant the outright dismissal of the appeal. In Development Bank of the
Philippines vs. Court of Appeals, we gave due course to the petitioner's appeal
despite the late filing of its brief in the appellate court because such appeal
involved public interest. We stated in the said case that the Court may exempt a
particular case from a strict application of the rules of procedure where the
appellant failed to perfect its appeal within the reglementary period, resulting in
the appellate court's failure to obtain jurisdiction over the case. In Republic vs.
Imperial, Jr., we also held that there is more leeway to exempt a case from the
strictness of procedural rules when the appellate court has already obtained
jurisdiction over the appealed case. We emphasize that:

[T]he rules of procedure are mere tools intended to facilitate the

attainment of justice, rather than frustrate it. A strict and rigid application
of the rules must always be eschewed when it would subvert the rule's
primary objective of enhancing fair trials and expediting justice.
Technicalities should never be used to defeat the substantive rights of the
other party. Every party-litigant must be afforded the amplest opportunity
for the proper and just determination of his cause, free from the
constraints of technicalities.60

Moreover, it should be remembered that the Rules were promulgated to set guidelines
in the orderly administration of justice, not to shackle the hand that dispenses it.
Otherwise, the courts would be consigned to being mere slaves to technical rules,
deprived of their judicial discretion. Technicalities must take a backseat to substantive
rights. After all, it is circumspect leniency in this respect that will give the parties the
fullest opportunity to ventilate the merits of their respective causes, rather than have
them lose life, liberty, honor or property on sheer technicalities. 61

The other technical issue posed by respondent is the alleged pro forma nature of MCC's
motion for reconsideration, ostensibly because it merely restated the arguments
previously raised and passed upon by the CA.

In this connection, suffice it to say that the mere restatement of arguments in a motion
for reconsideration does not per se result in a pro forma motion. In Security Bank and
Trust Company, Inc. v. Cuenca,62 we held that a motion for reconsideration may not be
necessarily pro forma even if it reiterates the arguments earlier passed upon and
rejected by the appellate court. A movant may raise the same arguments precisely to
convince the court that its ruling was erroneous. Furthermore, the pro forma rule will
not apply if the arguments were not sufficiently passed upon and answered in the
decision sought to be reconsidered.
 - II -

The second issue poses a novel question that the Court welcomes. It provides the
occasion for this Court to pronounce a definitive interpretation of the equally innovative
provisions of the Electronic Commerce Act of 2000 (R.A. No. 8792) vis-à-vis the Rules
on Electronic Evidence.

Although the parties did not raise the question whether the original facsimile
transmissions are "electronic data messages" or "electronic documents" within the
context of the Electronic Commerce Act (the petitioner merely assails as inadmissible
evidence the photocopies of the said facsimile transmissions), we deem it appropriate to
determine first whether the said fax transmissions are indeed within the coverage of
R.A. No. 8792 before ruling on whether the photocopies thereof are covered by the law.
In any case, this Court has ample authority to go beyond the pleadings when, in the
interest of justice or for the promotion of public policy, there is a need to make its own
findings in order to support its conclusions.63

Petitioner contends that the photocopies of the pro forma invoices presented by

respondent Ssangyong to prove the perfection of their supposed contract of sale are
inadmissible in evidence and do not fall within the ambit of R.A. No. 8792, because the
law merely admits as the best evidence the original fax transmittal. On the other hand,
respondent posits that, from a reading of the law and the Rules on Electronic Evidence,
the original facsimile transmittal of the pro forma invoice is admissible in evidence
since it is an electronic document and, therefore, the best evidence under the law and
the Rules. Respondent further claims that the photocopies of these fax transmittals
(specifically ST2-POSTS0401-1 and ST2-POSTS0401-2) are admissible under the
Rules on Evidence because the respondent sufficiently explained the non-production of
the original fax transmittals.

In resolving this issue, the appellate court ruled as follows:

Admissibility of Pro Forma

Invoices; Breach of Contract
by Appellants

Turning first to the appellants' argument against the admissibility of the Pro
Forma Invoices with Reference Nos. ST2-POSTS0401-1 and ST2-POSTS0401-2
(Exhibits "E", "E-1" and "F", pp. 215-218, Records), appellants argue that the said
documents are inadmissible (sic) being violative of the best evidence rule.

The argument is untenable.

The copies of the said pro-forma invoices submitted by the appellee are
admissible in evidence, although they are mere electronic facsimile printouts of
appellant's orders. Such facsimile printouts are considered Electronic Documents
under the New Rules on Electronic Evidence, which came into effect on August 1,
2001. (Rule 2, Section 1 [h], A.M. No. 01-7-01-SC).
 "(h) 'Electronic document' refers to information or the representation of
information, data, figures, symbols or other modes of written expression,
described or however represented, by which a right is established or an
obligation extinguished, or by which a fact may be proved and affirmed,
which is received, recorded, transmitted, stored, processed, retrieved or
produced electronically. It includes digitally signed documents and any
printout or output, readable by sight or other means, which accurately
reflects the electronic data message or electronic document. For purposes
of these Rules, the term 'electronic document' may be used
interchangeably with 'electronic data message'.

An electronic document shall be regarded as the equivalent of an original

document under the Best Evidence Rule, as long as it is a printout or output
readable by sight or other means, showing to reflect the data accurately. (Rule 4,
Section 1, A.M. No. 01-7-01-SC)

The ruling of the Appellate Court is incorrect. R.A. No. 8792, 64 otherwise known as the
Electronic Commerce Act of 2000, considers an electronic data message or an electronic
document as the functional equivalent of a written document for evidentiary
purposes.65 The Rules on Electronic Evidence 66 regards an electronic document as
admissible in evidence if it complies with the rules on admissibility prescribed by the
Rules of Court and related laws, and is authenticated in the manner prescribed by the
said Rules.67 An electronic document is also the equivalent of an original document
under the Best Evidence Rule, if it is a printout or output readable by sight or other
means, shown to reflect the data accurately.68

Thus, to be admissible in evidence as an electronic data message or to be considered as

the functional equivalent of an original document under the Best Evidence Rule,
the writing must foremost be an "electronic data message" or an "electronic
document."

The Electronic Commerce Act of 2000 defines electronic data message and electronic
document as follows:

Sec. 5. Definition of Terms. For the purposes of this Act, the following terms
are defined, as follows:

xxx

c. "Electronic Data Message" refers to information generated, sent, received or

stored by electronic, optical or similar means.

xxx

f. "Electronic Document" refers to information or the representation of

information, data, figures, symbols or other modes of written expression,
described or however represented, by which a right is established or an obligation
 extinguished, or by which a fact may be proved and affirmed, which is received,
recorded, transmitted, stored, processed, retrieved or produced electronically.

The Implementing Rules and Regulations (IRR) of R.A. No. 8792,69 which was signed on
July 13, 2000 by the then Secretaries of the Department of Trade and Industry, the
Department of Budget and Management, and then Governor of the Bangko Sentral ng
Pilipinas, defines the terms as:

Sec. 6. Definition of Terms. For the purposes of this Act and these Rules, the
following terms are defined, as follows:

xxx

(e) "Electronic Data Message" refers to information generated, sent, received or

stored by electronic, optical or similar means, but not limited to, electronic data
interchange (EDI), electronic mail, telegram, telex or telecopy. Throughout
these Rules, the term "electronic data message" shall be equivalent to and be
used interchangeably with "electronic document."

xxxx

(h) "Electronic Document" refers to information or the representation of

information, data, figures, symbols or other modes of written expression,
described or however represented, by which a right is established or an obligation
extinguished, or by which a fact may be proved and affirmed, which is received,
recorded, transmitted, stored, processed, retrieved or produced
electronically. Throughout these Rules, the term "electronic document" shall be
equivalent to and be used interchangeably with "electronic data message."

The phrase "but not limited to, electronic data interchange (EDI), electronic mail,
telegram, telex or telecopy" in the IRR's definition of "electronic data message" is
copied from the Model Law on Electronic Commerce adopted by the United Nations
Commission on International Trade Law (UNCITRAL),70 from which majority of the
provisions of R.A. No. 8792 were taken.71 While Congress deleted this phrase in the
Electronic Commerce Act of 2000, the drafters of the IRR reinstated it. The deletion by
Congress of the said phrase is significant and pivotal, as discussed hereunder.

The clause on the interchangeability of the terms "electronic data message" and
"electronic document" was the result of the Senate of the Philippines' adoption, in
Senate Bill 1902, of the phrase "electronic data message" and the House of
Representative's employment, in House Bill 9971, of the term "electronic
document."72 In order to expedite the reconciliation of the two versions, the technical
working group of the Bicameral Conference Committee adopted both terms and
intended them to be the equivalent of each one. 73 Be that as it may, there is a slight
difference between the two terms. While "data message" has reference to information
electronically sent, stored or transmitted, it does not necessarily mean that it will give
rise to a right or extinguish an obligation,74 unlike an electronic document. Evident
from the law, however, is the legislative intent to give the two terms the same
construction.

The Rules on Electronic Evidence promulgated by this Court defines the said terms in
the following manner:

SECTION 1. Definition of Terms. - For purposes of these Rules, the following

terms are defined, as follows:

xxxx

(g) "Electronic data message" refers to information generated, sent, received or

stored by electronic, optical or similar means.

(h) "Electronic document" refers to information or the representation of

information, data, figures, symbols or other modes of written expression,
described or however represented, by which a right is established or an obligation
extinguished, or by which a fact may be proved and affirmed, which is received,
recorded, transmitted, stored, processed, retrieved or produced electronically. It
includes digitally signed documents and print-out or output, readable by sight
or other means, which accurately reflects the electronic data message or
electronic document. For purposes of these Rules, the term "electronic
document" may be used interchangeably with "electronic data message."

Given these definitions, we go back to the original question: Is an original printout of

a facsimile transmission an electronic data message or electronic document?

The definitions under the Electronic Commerce Act of 2000, its IRR and the Rules on
Electronic Evidence, at first glance, convey the impression that facsimile
transmissions are electronic data messages or electronic documents because they
are sent by electronic means. The expanded definition of an "electronic data message"
under the IRR, consistent with the UNCITRAL Model Law, further supports this theory
considering that the enumeration "xxx [is] not limited to, electronic data interchange
(EDI), electronic mail, telegram, telex or telecopy." And to telecopy is to send a
document from one place to another via a fax machine.75

As further guide for the Court in its task of statutory construction, Section 37 of the
Electronic Commerce Act of 2000 provides that

Unless otherwise expressly provided for, the interpretation of this Act shall give
due regard to its international origin and the need to promote uniformity in its
application and the observance of good faith in international trade relations. The
generally accepted principles of international law and convention on electronic
commerce shall likewise be considered.

Obviously, the "international origin" mentioned in this section can only refer to the
UNCITRAL Model Law, and the UNCITRAL's definition of "data message":
 "Data message" means information generated, sent, received or stored by
electronic, optical or similar means including, but not limited to, electronic data
interchange (EDI), electronic mail, telegram, telex or telecopy.76

is substantially the same as the IRR's characterization of an "electronic data message."

However, Congress deleted the phrase, "but not limited to, electronic data interchange
(EDI), electronic mail, telegram, telex or telecopy," and replaced the term "data
message" (as found in the UNCITRAL Model Law ) with "electronic data message." This
legislative divergence from what is assumed as the term's "international origin" has bred
uncertainty and now impels the Court to make an inquiry into the true intent of the
framers of the law. Indeed, in the construction or interpretation of a legislative measure,
the primary rule is to search for and determine the intent and spirit of the law. 77 A
construction should be rejected that gives to the language used in a statute a meaning
that does not accomplish the purpose for which the statute was enacted, and that tends
to defeat the ends which are sought to be attained by the enactment. 78

Interestingly, when Senator Ramon B. Magsaysay, Jr., the principal author of Senate
Bill 1902 (the predecessor of R.A. No. 8792), sponsored the bill on second reading, he
proposed to adopt the term "data message" as formulated and defined in the UNCITRAL
Model Law.79 During the period of amendments, however, the term evolved into
"electronic data message," and the phrase "but not limited to, electronic data
interchange (EDI), electronic mail, telegram, telex or telecopy" in the UNCITRAL
Model Law was deleted. Furthermore, the term "electronic data message," though
maintaining its description under the UNCITRAL Model Law, except for the aforesaid
deleted phrase, conveyed a different meaning, as revealed in the following proceedings:

xxxx

Senator Santiago. Yes, Mr. President. I will furnish a copy together with the
explanation of this proposed amendment.

And then finally, before I leave the Floor, may I please be allowed to go back to
Section 5; the Definition of Terms. In light of the acceptance by the good Senator
of my proposed amendments, it will then become necessary to add certain terms
in our list of terms to be defined. I would like to add a definition on what is
"data," what is "electronic record" and what is an "electronic record system."

If the gentleman will give me permission, I will proceed with the proposed
amendment on Definition of Terms, Section 5.

Senator Magsaysay. Please go ahead, Senator Santiago.

Senator Santiago. We are in Part 1, short title on the Declaration of Policy,

Section 5, Definition of Terms.

At the appropriate places in the listing of these terms that have to be defined
since these are arranged alphabetically, Mr. President, I would like to insert the
term DATA and its definition. So, the amendment will read: "DATA" MEANS
REPRESENTATION, IN ANY FORM, OF INFORMATION OR CONCEPTS.

The explanation is this: This definition of "data" or "data" as it is now fashionably

pronounced in America - - the definition of "data" ensures that our bill applies to
any form of information in an electronic record, whether these are figures, facts
or ideas.

So again, the proposed amendment is this: "DATA" MEANS

REPRESENTATIONS, IN ANY FORM, OF INFORMATION OR CONCEPTS.

Senator Magsaysay. May I know how will this affect the definition of "Data
Message" which encompasses electronic records, electronic writings and
electronic documents?

Senator Santiago. These are completely congruent with each other. These are
compatible. When we define "data," we are simply reinforcing the definition of
what is a data message.

Senator Magsaysay. It is accepted, Mr. President.

Senator Santiago. Thank you. The next term is "ELECTRONIC RECORD." The
proposed amendment is as follows:

"ELECTRONIC RECORD" MEANS DATA THAT IS RECORDED OR STORED

ON ANY MEDIUM IN OR BY A COMPUTER SYSTEM OR OTHER SIMILAR
DEVICE, THAT CAN BE READ OR PERCEIVED BY A PERSON OR A
COMPUTER SYSTEM OR OTHER SIMILAR DEVICE. IT INCLUDES A
DISPLAY, PRINTOUT OR OTHER OUTPUT OF THAT DATA.

The explanation for this term and its definition is as follows: The term
"ELECTRONIC RECORD" fixes the scope of our bill. The record is the data. The
record may be on any medium. It is electronic because it is recorded or stored in
or by a computer system or a similar device.

The amendment is intended to apply, for example, to data on magnetic strips on

cards or in Smart cards. As drafted, it would not apply to telexes or
faxes, except computer-generated faxes, unlike the United Nations
model law on electronic commerce. It would also not apply to regular
digital telephone conversations since the information is not recorded. It would
apply to voice mail since the information has been recorded in or by a device
similar to a computer. Likewise, video records are not covered. Though when the
video is transferred to a website, it would be covered because of the involvement
of the computer. Music recorded by a computer system on a compact disc would
be covered.

In short, not all data recorded or stored in digital form is covered. A computer
or a similar device has to be involved in its creation or storage. The term
"similar device" does not extend to all devices that create or store data in digital
form. Although things that are not recorded or preserved by or in a computer
system are omitted from this bill, these may well be admissible under other
rules of law. This provision focuses on replacing the search for originality
proving the reliability of systems instead of that of individual records and using
standards to show systems reliability.

Paper records that are produced directly by a computer system such as

printouts are themselves electronic records being just the means of intelligible
display of the contents of the record. Photocopies of the printout would be paper
record subject to the usual rules about copies, but the original printout would be
subject to the rules of admissibility of this bill.

However, printouts that are used only as paper records and whose computer
origin is never again called on are treated as paper records. In that case, the
reliability of the computer system that produces the record is irrelevant to its
reliability.

Senator Magsaysay. Mr. President, if my memory does not fail me, earlier, the
lady Senator accepted that we use the term "Data Message" rather than
"ELECTRONIC RECORD" in being consistent with the UNCITRAL term of "Data
Message." So with the new amendment of defining "ELECTRONIC RECORD,"
will this affect her accepting of the use of "Data Message" instead of
"ELECTRONIC RECORD"?

Senator Santiago. No, it will not. Thank you for reminding me. The term I would
like to insert is ELECTRONIC DATA MESSAGE in lieu of "ELECTRONIC
RECORD."

Senator Magsaysay. Then we are, in effect, amending the term of the

definition of "Data Message" on page 2A, line 31, to which we have
no objection.

Senator Santiago. Thank you, Mr. President.

xxxx

Senator Santiago. Mr. President, I have proposed all the amendments that I
desire to, including the amendment on the effect of error or change. I will provide
the language of the amendment together with the explanation supporting that
amendment to the distinguished sponsor and then he can feel free to take it up in
any session without any further intervention.

Senator Magsaysay. Before we end, Mr. President, I understand from the

proponent of these amendments that these are based on the Canadian E-
commerce Law of 1998. Is that not right?

Senator Santiago. That is correct.80

Thus, when the Senate consequently voted to adopt the term "electronic data message,"
it was consonant with the explanation of Senator Miriam Defensor-Santiago that it
would not apply "to telexes or faxes, except computer-generated faxes, unlike the
United Nations model law on electronic commerce." In explaining the term "electronic
record" patterned after the E-Commerce Law of Canada, Senator Defensor-Santiago had
in mind the term "electronic data message." This term then, while maintaining part of
the UNCITRAL Model Law's terminology of "data message," has assumed a different
context, this time, consonant with the term "electronic record" in the law of Canada. It
accounts for the addition of the word "electronic" and the deletion of the phrase "but not
limited to, electronic data interchange (EDI), electronic mail, telegram, telex or
telecopy." Noteworthy is that the Uniform Law Conference of Canada, explains the term
"electronic record," as drafted in the Uniform Electronic Evidence Act, in a manner
strikingly similar to Sen. Santiago's explanation during the Senate deliberations:

"Electronic record" fixes the scope of the Act. The record is the data. The record
may be any medium. It is "electronic" because it is recorded or stored in or by a
computer system or similar device. The Act is intended to apply, for example, to
data on magnetic strips on cards, or in smart cards. As drafted, it would not
apply to telexes or faxes (except computer-generated faxes), unlike the United
Nations Model Law on Electronic Commerce. It would also not apply to regular
digital telephone conversations, since the information is not recorded. It would
apply to voice mail, since the information has been recorded in or by a device
similar to a computer. Likewise video records are not covered, though when the
video is transferred to a Web site it would be, because of the involvement of the
computer. Music recorded by a computer system on a compact disk would be
covered.

In short, not all data recorded or stored in "digital" form is covered. A computer
or similar device has to be involved in its creation or storage. The term "similar
device" does not extend to all devices that create or store data in digital form.
Although things that are not recorded or preserved by or in a computer system
are omitted from this Act, they may well be admissible under other rules of law.
This Act focuses on replacing the search for originality, proving the reliability of
systems instead of that of individual records, and using standards to show
systems reliability.

Paper records that are produced directly by a computer system, such as printouts,
are themselves electronic records, being just the means of intelligible display of
the contents of the record. Photocopies of the printout would be paper records
subject to the usual rules about copies, but the "original" printout would be
subject to the rules of admissibility of this Act.

However, printouts that are used only as paper records, and whose computer
origin is never again called on, are treated as paper records. See subsection 4(2).
In this case the reliability of the computer system that produced the record is
relevant to its reliability.81
There is no question then that when Congress formulated the term "electronic data
message," it intended the same meaning as the term "electronic record" in the Canada
law. This construction of the term "electronic data message," which excludes telexes or
faxes, except computer-generated faxes, is in harmony with the Electronic Commerce
Law's focus on "paperless" communications and the "functional equivalent
approach"82 that it espouses. In fact, the deliberations of the Legislature are replete with
discussions on paperless and digital transactions.

Facsimile transmissions are not, in this sense, "paperless," but verily are paper-based.

A facsimile machine, which was first patented in 1843 by Alexander Bain, 83 is a device
that can send or receive pictures and text over a telephone line. It works by digitizing an
image—dividing it into a grid of dots. Each dot is either on or off, depending on whether
it is black or white. Electronically, each dot is represented by a bit that has a value of
either 0 (off) or 1 (on). In this way, the fax machine translates a picture into a series of
zeros and ones (called a bit map) that can be transmitted like normal computer data. On
the receiving side, a fax machine reads the incoming data, translates the zeros and ones
back into dots, and reprints the picture. 84 A fax machine is essentially an image scanner,
a modem and a computer printer combined into a highly specialized package. The
scanner converts the content of a physical document into a digital image, the modem
sends the image data over a phone line, and the printer at the other end makes a
duplicate of the original document.85 Thus, in Garvida v. Sales, Jr.,86 where we
explained the unacceptability of filing pleadings through fax machines, we ruled that:

A facsimile or fax transmission is a process involving the transmission and

reproduction of printed and graphic matter by scanning an original copy, one
elemental area at a time, and representing the shade or tone of each area by a
specified amount of electric current. The current is transmitted as a signal over
regular telephone lines or via microwave relay and is used by the receiver to
reproduce an image of the elemental area in the proper position and the correct
shade. The receiver is equipped with a stylus or other device that produces a
printed record on paper referred to as a facsimile.

x x x A facsimile is not a genuine and authentic pleading. It is, at best, an exact
copy preserving all the marks of an original. Without the original, there is no way
of determining on its face whether the facsimile pleading is genuine and
authentic and was originally signed by the party and his counsel. It may, in fact,
be a sham pleading.87

Accordingly, in an ordinary facsimile transmission, there exists an original paper-

based information or data that is scanned, sent through a phone line, and re-printed at
the receiving end. Be it noted that in enacting the Electronic Commerce Act of 2000,
Congress intended virtual or paperless writings to be the functional equivalent and to
have the same legal function as paper-based documents.88 Further, in a virtual or
paperless environment, technically, there is no original copy to speak of, as all direct
printouts of the virtual reality are the same, in all respects, and are considered as
originals.89 Ineluctably, the law's definition of "electronic data message," which, as
aforesaid, is interchangeable with "electronic document," could not have
included facsimile transmissions, which have an original paper-based copy as sent and
a paper-based facsimile copy as received. These two copies are distinct from each other,
and have different legal effects. While Congress anticipated future developments in
communications and computer technology90 when it drafted the law, it excluded the
early forms of technology, like telegraph, telex and telecopy (except computer-generated
faxes, which is a newer development as compared to the ordinary fax machine to fax
machine transmission), when it defined the term "electronic data message."

Clearly then, the IRR went beyond the parameters of the law when it adopted verbatim
the UNCITRAL Model Law's definition of "data message," without considering the
intention of Congress when the latter deleted the phrase "but not limited to, electronic
data interchange (EDI), electronic mail, telegram, telex or telecopy." The inclusion of
this phrase in the IRR offends a basic tenet in the exercise of the rule-making power of
administrative agencies. After all, the power of administrative officials to promulgate
rules in the implementation of a statute is necessarily limited to what is found in the
legislative enactment itself. The implementing rules and regulations of a law cannot
extend the law or expand its coverage, as the power to amend or repeal a statute is
vested in the Legislature. 91 Thus, if a discrepancy occurs between the basic law and an
implementing rule or regulation, it is the former that prevails, because the law cannot be
broadened by a mere administrative issuance—an administrative agency certainly
cannot amend an act of Congress.92 Had the Legislature really wanted ordinary fax
transmissions to be covered by the mantle of the Electronic Commerce Act of 2000, it
could have easily lifted without a bit of tatter the entire wordings of the UNCITRAL
Model Law.

Incidentally, the National Statistical Coordination Board Task Force on the

Measurement of E-Commerce,93 on November 22, 2006, recommended a working
definition of "electronic commerce," as "[a]ny commercial transaction conducted
through electronic, optical and similar medium, mode, instrumentality and technology.
The transaction includes the sale or purchase of goods and services, between
individuals, households, businesses and governments conducted over computer-
mediated networks through the Internet, mobile phones, electronic data interchange
(EDI) and other channels through open and closed networks." The Task Force's
proposed definition is similar to the Organization of Economic Cooperation and
Development's (OECD's) broad definition as it covers transactions made over any
network, and, in addition, it adopted the following provisions of the OECD definition:
(1) for transactions, it covers sale or purchase of goods and services; (2) for
channel/network, it considers any computer-mediated network and NOT limited to
Internet alone; (3) it excludes transactions received/placed using fax, telephone or non-
interactive mail; (4) it considers payments done online or offline; and (5) it considers
delivery made online (like downloading of purchased books, music or software
programs) or offline (deliveries of goods).94

We, therefore, conclude that the terms "electronic data message" and "electronic
document," as defined under the Electronic Commerce Act of 2000, do not include a
facsimile transmission. Accordingly, a facsimile transmission cannot be considered
as electronic evidence. It is not the functional equivalent of an original under the
Best Evidence Rule and is not admissible as electronic evidence.

Since a facsimile transmission is not an "electronic data message" or an "electronic

document," and cannot be considered as electronic evidence by the Court, with greater
reason is a photocopy of such a fax transmission not electronic evidence. In the present
case, therefore, Pro Forma Invoice Nos. ST2-POSTS0401-1 and ST2-POSTS0401-2
(Exhibits "E" and "F"), which are mere photocopies of the original fax transmittals,
are not electronic evidence, contrary to the position of both the trial and the appellate
courts.

- III -

Nevertheless, despite the pro forma invoices not being electronic evidence, this Court
finds that respondent has proven by preponderance of evidence the existence of a
perfected contract of sale.

In an action for damages due to a breach of a contract, it is essential that the claimant
proves (1) the existence of a perfected contract, (2) the breach thereof by the other
contracting party and (3) the damages which he/she sustained due to such
breach. Actori incumbit onus probandi. The burden of proof rests on the party who
advances a proposition affirmatively.95 In other words, a plaintiff in a civil action must
establish his case by a preponderance of evidence, that is, evidence that has greater
weight, or is more convincing than that which is offered in opposition to it. 96

In general, contracts are perfected by mere consent, 97 which is manifested by the

meeting of the offer and the acceptance upon the thing and the cause which are to
constitute the contract. The offer must be certain and the acceptance absolute. 98 They
are, moreover, obligatory in whatever form they may have been entered into, provided
all the essential requisites for their validity are present. 99 Sale, being a consensual
contract, follows the general rule that it is perfected at the moment there is a meeting of
the minds upon the thing which is the object of the contract and upon the price. From
that moment, the parties may reciprocally demand performance, subject to the
provisions of the law governing the form of contracts. 100

The essential elements of a contract of sale are (1) consent or meeting of the minds, that
is, to transfer ownership in exchange for the price, (2) object certain which is the subject
matter of the contract, and (3) cause of the obligation which is established. 101

In this case, to establish the existence of a perfected contract of sale between the parties,
respondent Ssangyong formally offered in evidence the testimonies of its witnesses and
the following exhibits:

Exhibit Description Purpose

E Pro forma Invoice dated 17 April To show that defendants contracted with

 2000 with Contract No. ST2- plaintiff for the delivery of 110 MT of
POSTS0401-1, photocopy stainless steel from Korea payable by way of
an irrevocable letter of credit in favor of
plaintiff, among other conditions.

E-1 Pro forma Invoice dated 17 April
2000 with Contract No. ST2-
POSTS0401, contained in
facsimile/thermal paper faxed by
defendants to plaintiff showing the
printed transmission details on the
upper portion of said paper as
coming from defendant MCC on 26
Apr 00 08:41AM
To show that defendants sent their
confirmation of the (i) delivery to it of the
specified stainless steel products, (ii)
defendants' payment thereof by way of an
irrevocable letter of credit in favor of plaintiff,
among other conditions.

E-2 Conforme signature of Mr. Gregory To show that defendants sent their

Chan, contained in
facsimile/thermal paper faxed by
defendants to plaintiff showing the
printed transmission details on the
upper portion of said paper as
coming from defendant MCC on 26
Apr 00 08:41AM
confirmation of the (i) delivery to it of the total
of 220MT specified stainless steel products,
(ii) defendants' payment thereof by way of an
irrevocable letter of credit in favor of plaintiff,
among other conditions.

F Pro forma Invoice dated 17 April To show that defendants contracted with
2000 with Contract No. ST2- plaintiff for delivery of another 110 MT of
POSTSO401-2, photocopy stainless steel from Korea payable by way of
an irrevocable letter of credit in favor of
plaintiff, among other conditions.

G Letter to defendant SANYO SEIKE To prove that defendants were informed of the
dated 20 June 2000, contained in date of L/C opening and
facsimile/thermal paper defendant's conforme/approval thereof.

G-1 Signature of defendant Gregory

Chan, contained in facsimile/thermal
paper.

H Letter to defendants dated 22 June To prove that defendants were informed of the
2000, original successful price adjustments secured by
plaintiff in favor of former and were advised
of the schedules of its L/C opening.

I Letter to defendants dated 26 June To prove that plaintiff repeatedly requested

2000, original defendants for the agreed opening of the
Letters of Credit, defendants' failure and
J Letter to defendants dated 26 June refusal to comply with their obligations and
2000, original the problems of plaintiff is incurring by reason
of defendants' failure and refusal to open the
L/Cs.
K Letter to defendants dated 27 June
2000, original

L Facsimile message to defendants

dated 28 June 2000, photocopy

M Letter from defendants dated 29 June
2000, contained in facsimile/thermal
paper faxed by defendants to
plaintiff showing the printed
transmission details on the upper
portion of said paper as coming
from defendant MCC on 29 June 00
11:12 AM
To prove that defendants admit of their
liabilities to plaintiff, that they requested for
"more extension" of time for the opening of
the Letter of Credit, and begging for favorable
understanding and consideration.

M-1 Signature of defendant Gregory  

Chan, contained in facsimile/thermal
paper faxed by defendants to
plaintiff showing the printed
transmission details on the upper
portion of said paper as coming
from defendant MCC on June 00
11:12 AM

N Letter to defendants dated 29 June  

2000, original

O Letter to defendants dated 30 June To prove that plaintiff reiterated its request for
2000, photocopy defendants to L/C opening after the latter's
request for extension of time was granted,
defendants' failure and refusal to comply
therewith extension of time notwithstanding.

P Letter to defendants dated 06 July  

2000, original

Q Demand letter to defendants dated 15 To prove that plaintiff was constrained to

Aug 2000, original engaged services of a lawyer for collection
efforts.

R Demand letter to defendants dated 23 To prove that defendants opened the first L/C
 Aug 2000, original in favor of plaintiff, requested for further
postponement of the final L/C and for minimal
amounts, were urged to open the final L/C on
time, and were informed that failure to comply
will cancel the contract.

S Demand letter to defendants dated 11 To show defendants' refusal and failure to

Sept 2000, original open the final L/C on time, the cancellation of
the contract as a consequence thereof, and
final demand upon defendants to remit its
obligations.

W Letter from plaintiff SSANGYONG To prove that there was a perfected sale and
to defendant SANYO SEIKI dated purchase agreement between the parties for
13 April 2000, with fax back from 220 metric tons of steel products at the price of
defendants SANYO SEIKI/MCC to US$1,860/ton.
plaintiff SSANGYONG, contained
in facsimile/thermal paper with
back-up photocopy

W-1 Conforme signature of defendant To prove that defendants, acting through

Gregory Chan, contained in Gregory Chan, agreed to the sale and purchase
facsimile/thermal paper with back- of 220 metric tons of steel products at the price
up photocopy of US$1,860/ton.

W-2 Name of sender MCC Industrial To prove that defendants sent their conformity
Sales Corporation to the sale and purchase agreement by
facsimile transmission.

X Pro forma Invoice dated 16 August To prove that defendant MCC agreed to adjust
2000, photocopy and split the confirmed purchase order into 2
shipments at 100 metric tons each at the
discounted price of US$1,700/ton.

X-1 Notation "1/2", photocopy To prove that the present Pro forma Invoice

was the first of 2 pro forma invoices.

X-2 Ref. No. ST2-POSTS080- To prove that the present Pro forma Invoice

1, photocopy was the first of 2 pro forma invoices.

X-3 Conforme signature of defendant To prove that defendant MCC, acting through

Gregory Chan, photocopy
Gregory Chan, agreed to the sale and purchase
of the balance of 100 metric tons at the
discounted price of US$1,700/ton, apart from
the other order and shipment of 100 metric
tons which was delivered by plaintiff
 SSANGYONG and paid for by defendant
MCC.

DD Letter from defendant MCC to To prove that there was a perfected sale and
plaintiff SSANGYONG dated 22 purchase agreement between plaintiff
August 2000, contained in SSANGYONG and defendant MCC for the
facsimile/thermal paper with back- balance of 100 metric tons, apart from the
up photocopy other order and shipment of 100 metric tons
which was delivered by plaintiff
SSANGYONG and paid for by defendant
MCC.

DD-1 Ref. No. ST2-POSTS080- To prove that there was a perfected sale and
1, contained in facsimile/thermal purchase agreement between plaintiff
paper with back-up photocopy SSANGYONG and defendant MCC for the
balance of 100 metric tons, apart from the
other order and shipment of 100 metric tons
which was delivered by plaintiff
SSANGYONG and paid for by defendant
MCC.

DD-2 Signature of defendant Gregory To prove that defendant MCC, acting through
Chan, contained in facsimile/thermal Gregory Chan, agreed to the sale and purchase
paper with back-up photocopy of the balance of 100 metric tons, apart from
the other order and shipment of 100 metric
tons which was delivered by plaintiff
Ssangyong and paid for by defendant MCC. 102

Significantly, among these documentary evidence presented by respondent, MCC, in its

petition before this Court, assails the admissibility only of Pro Forma Invoice Nos. ST2-
POSTS0401-1 and ST2-POSTS0401-2 (Exhibits "E" and "F"). After sifting through
the records, the Court found that these invoices are mere photocopies of their
original fax transmittals. Ssangyong avers that these documents were prepared after
MCC asked for the splitting of the original order into two, so that the latter can apply for
an L/C with greater facility. It, however, failed to explain why the originals of these
documents were not presented.

To determine whether these documents are admissible in evidence, we apply the

ordinary Rules on Evidence, for as discussed above we cannot apply the Electronic
Commerce Act of 2000 and the Rules on Electronic Evidence.

Because these documents are mere photocopies, they are simply secondary evidence,
admissible only upon compliance with Rule 130, Section 5, which states, "[w]hen the
original document has been lost or destroyed, or cannot be produced in court, the
offeror, upon proof of its execution or existence and the cause of its unavailability
without bad faith on his part, may prove its contents by a copy, or by a recital of its
contents in some authentic document, or by the testimony of witnesses in the order
stated." Furthermore, the offeror of secondary evidence must prove the predicates
thereof, namely: (a) the loss or destruction of the original without bad faith on the part
of the proponent/offeror which can be shown by circumstantial evidence of routine
practices of destruction of documents; (b) the proponent must prove by a fair
preponderance of evidence as to raise a reasonable inference of the loss or destruction of
the original copy; and (c) it must be shown that a diligent and bona fide but
unsuccessful search has been made for the document in the proper place or places. It
has been held that where the missing document is the foundation of the action, more
strictness in proof is required than where the document is only collaterally involved. 103

Given these norms, we find that respondent failed to prove the existence of the original
fax transmissions of Exhibits E and F, and likewise did not sufficiently prove the loss or
destruction of the originals. Thus, Exhibits E and F cannot be admitted in evidence and
accorded probative weight.

It is observed, however, that respondent Ssangyong did not rely merely on Exhibits E
and F to prove the perfected contract. It also introduced in evidence a variety of other
documents, as enumerated above, together with the testimonies of its witnesses.
Notable among them are Pro Forma Invoice Nos. ST2-POSTS080-1 and ST2-
POSTS080-2 which were issued by Ssangyong and sent via fax to MCC. As already
mentioned, these invoices slightly varied the terms of the earlier invoices such that the
quantity was now officially 100MT per invoice and the price reduced
to US$1,700.00 per MT. The copies of the said August 16, 2000 invoices submitted to
the court bear the conformity signature of MCC Manager Chan.

Pro Forma Invoice No. ST2-POSTS080-1 (Exhibit "X"), however, is a mere photocopy

of its original. But then again, petitioner MCC does not assail the admissibility of this
document in the instant petition. Verily, evidence not objected to is deemed admitted
and may be validly considered by the court in arriving at its judgment. 104 Issues not
raised on appeal are deemed abandoned.

As to Pro Forma Invoice No. ST2-POSTS080-2 (Exhibits "1-A" and "2-C"), which was

certified by PCIBank as a true copy of its original,105 it was, in fact, petitioner MCC which
introduced this document in evidence. Petitioner MCC paid for the order stated in this
invoice. Its admissibility, therefore, is not open to question.

These invoices (ST2-POSTS0401, ST2-POSTS080-1 and ST2-POSTS080-2),

along with the other unchallenged documentary evidence of respondent Ssangyong,
preponderate in favor of the claim that a contract of sale was perfected by the parties.

This Court also finds merit in the following observations of the trial court:

Defendants presented Letter of Credit (Exhibits "1", "1-A" to "1-R") referring to

Pro Forma Invoice for Contract No. ST2POSTS080-2, in the amount of
US$170,000.00, and which bears the signature of Gregory Chan, General
Manager of MCC. Plaintiff, on the other hand, presented Pro Forma Invoice
referring to Contract No. ST2-POSTS080-1, in the amount of US$170,000.00,
which likewise bears the signature of Gregory Chan, MCC. Plaintiff accounted for
the notation "1/2" on the right upper portion of the Invoice, that is, that it was the
 first of two (2) pro forma invoices covering the subject contract between plaintiff
and the defendants. Defendants, on the other hand, failed to account for the
notation "2/2" in its Pro Forma Invoice (Exhibit "1-A"). Observably further, both
Pro Forma Invoices bear the same date and details, which logically mean that
they both apply to one and the same transaction. 106

Indeed, why would petitioner open an L/C for the second half of the transaction if there
was no first half to speak of?

The logical chain of events, as gleaned from the evidence of both parties, started with
the petitioner and the respondent agreeing on the sale and purchase of 220MT of
stainless steel at US$1,860.00 per MT. This initial contract was perfected. Later, as
petitioner asked for several extensions to pay, adjustments in the delivery dates, and
discounts in the price as originally agreed, the parties slightly varied the terms of their
contract, without necessarily novating it, to the effect that the original order was
reduced to 200MT, split into two deliveries, and the price discounted to US$1,700 per
MT. Petitioner, however, paid only half of its obligation and failed to open an L/C for the
other 100MT. Notably, the conduct of both parties sufficiently established the existence
of a contract of sale, even if the writings of the parties, because of their contested
admissibility, were not as explicit in establishing a contract. 107 Appropriate conduct by
the parties may be sufficient to establish an agreement, and while there may be
instances where the exchange of correspondence does not disclose the exact point at
which the deal was closed, the actions of the parties may indicate that a binding
obligation has been undertaken.108

With our finding that there is a valid contract, it is crystal-clear that when petitioner did
not open the L/C for the first half of the transaction (100MT), despite numerous
demands from respondent Ssangyong, petitioner breached its contractual obligation. It
is a well-entrenched rule that the failure of a buyer to furnish an agreed letter of credit is
a breach of the contract between buyer and seller. Indeed, where the buyer fails to open
a letter of credit as stipulated, the seller or exporter is entitled to claim damages for such
breach. Damages for failure to open a commercial credit may, in appropriate cases,
include the loss of profit which the seller would reasonably have made had the
transaction been carried out.109

- IV -

This Court, however, finds that the award of actual damages is not in accord with the
evidence on record. It is axiomatic that actual or compensatory damages cannot be
presumed, but must be proven with a reasonable degree of certainty. 110 In Villafuerte v.
Court of Appeals,111 we explained that:

Actual or compensatory damages are those awarded in order to compensate a

party for an injury or loss he suffered. They arise out of a sense of natural justice
and are aimed at repairing the wrong done. Except as provided by law or by
stipulation, a party is entitled to an adequate compensation only for such
pecuniary loss as he has duly proven. It is hornbook doctrine that to be able to
 recover actual damages, the claimant bears the onus of presenting before the
court actual proof of the damages alleged to have been suffered, thus:

A party is entitled to an adequate compensation for such pecuniary loss

actually suffered by him as he has duly proved. Such damages, to be
recoverable, must not only be capable of proof, but must actually be
proved with a reasonable degree of certainty. We have emphasized that
these damages cannot be presumed and courts, in making an award must
point out specific facts which could afford a basis for measuring whatever
compensatory or actual damages are borne.112

In the instant case, the trial court awarded to respondent Ssangyong US$93,493.87 as
actual damages. On appeal, the same was affirmed by the appellate court. Noticeably,
however, the trial and the appellate courts, in making the said award, relied on the
following documents submitted in evidence by the respondent: (1) Exhibit "U," the
Statement of Account dated March 30, 2001; (2) Exhibit "U-1," the details of the said
Statement of Account); (3) Exhibit "V," the contract of the alleged resale of the goods to
a Korean corporation; and (4) Exhibit "V-1," the authentication of the resale contract
from the Korean Embassy and certification from the Philippine Consular Office.

The statement of account and the details of the losses sustained by respondent due to
the said breach are, at best, self-serving. It was respondent Ssangyong itself which
prepared the said documents. The items therein are not even substantiated by official
receipts. In the absence of corroborative evidence, the said statement of account is not
sufficient basis to award actual damages. The court cannot simply rely on speculation,
conjecture or guesswork as to the fact and amount of damages, but must depend
on competent proof that the claimant had suffered, and on evidence of, the actual
amount thereof.113

Furthermore, the sales contract and its authentication certificates, Exhibits "V" and "V-
1," allegedly evidencing the resale at a loss of the stainless steel subject of the parties'
breached contract, fail to convince this Court of the veracity of its contents. The steel
items indicated in the sales contract114 with a Korean corporation are different in all
respects from the items ordered by petitioner MCC, even in size and quantity. We
observed the following discrepancies:

List of commodities as stated in Exhibit "V":

COMMODITY: Stainless Steel HR Sheet in Coil, Slit Edge

SPEC: SUS304 NO. 1

SIZE/Q'TY:

2.8MM X 1,219MM X C 8.193MT

 3.0MM X 1,219MM X C 7.736MT

3.0MM X 1,219MM X C 7.885MT

3.0MM X 1,219MM X C 8.629MT

4.0MM X 1,219MM X C 7.307MT

4.0MM X 1,219MM X C 7.247MT

4.5MM X 1,219MM X C 8.450MT

4.5MM X 1,219MM X C 8.870MT

5.0MM X 1,219MM X C 8.391MT

6.0MM X 1,219MM X C 6.589MT

6.0MM X 1,219MM X C 7.878MT

6.0MM X 1,219MM X C 8.397MT

TOTAL: 95.562MT115

List of commodities as stated in Exhibit "X" (the invoice that was not paid):

DESCRIPTION: Hot Rolled Stainless Steel Coil SUS 304

SIZE AND QUANTITY:

2.6 MM X 4' X C 10.0MT

3.0 MM X 4' X C 25.0MT

 4.0 MM X 4' X C 15.0MT

4.5 MM X 4' X C 15.0MT

5.0 MM X 4' X C 10.0MT

6.0 MM X 4' X C 25.0MT

TOTAL: 100MT116

From the foregoing, we find merit in the contention of MCC that Ssangyong did not
adequately prove that the items resold at a loss were the same items ordered by the
petitioner. Therefore, as the claim for actual damages was not proven, the Court cannot
sanction the award.

Nonetheless, the Court finds that petitioner knowingly breached its contractual
obligation and obstinately refused to pay despite repeated demands from respondent.
Petitioner even asked for several extensions of time for it to make good its obligation.
But in spite of respondent's continuous accommodation, petitioner completely reneged
on its contractual duty. For such inattention and insensitivity, MCC must be held liable
for nominal damages. "Nominal damages are 'recoverable where a legal right is
technically violated and must be vindicated against an invasion that has produced no
actual present loss of any kind or where there has been a breach of contract and no
substantial injury or actual damages whatsoever have been or can be
shown.'"117 Accordingly, the Court awards nominal damages of P200,000.00 to
respondent Ssangyong.

As to the award of attorney's fees, it is well settled that no premium should be placed on
the right to litigate and not every winning party is entitled to an automatic grant of
attorney's fees. The party must show that he falls under one of the instances enumerated
in Article 2208 of the Civil Code.118 In the instant case, however, the Court finds the
award of attorney's fees proper, considering that petitioner MCC's unjustified refusal to
pay has compelled respondent Ssangyong to litigate and to incur expenses to protect its
rights.

WHEREFORE, PREMISESCONSIDERED, the appeal is PARTIALLY

GRANTED. The Decision of the Court of Appeals in CA-G.R. CV No. 82983
is MODIFIED in that the award of actual damages is DELETED. However, petitioner
is ORDERED to pay respondent NOMINAL DAMAGES in the amount
of P200,000.00, and the ATTORNEY'S FEES as awarded by the trial court.

SO ORDERED.