age 1 of 13

8epubllc of Lhe hlllpplnes

SUkLML CCUk1
Manlla
SLCCnu ulvlSlCn

Gk No L40098 August 29 197S
AN1CNIC LIM 1ANnU D CCnA ALICNSC LLCNAkDC NG SUA and CC CC peLlLloners
vs
nCN ICSL k kAMCLL1L as res|d|ng Iudge 8ranch III CII Cebu and 1AN U1 respondenLs
2oso 2oso costlllo AlcoJlo kob fot petltlooets
llJel Mooolo ooJ llotlJo Assoclotes fot tespooJeots

8AkkLDC
eLlLlon for (1) cettlototl Lo annul and seL aslde cerLaln acLuaLlons of respondenL CourL of llrsL lnsLance of Cebu 8ranch lll ln lLs Clvll Case no 12328 an acLlon for accounLlng of properLles and money
LoLalllng allegedly abouL 13 mllllon pesos flled wlLh a common cause of acLlon agalnsL slx defendanLs ln whlch afLer declarlng four of Lhe sald defendanLs hereln peLlLloners ln defaulL and whlle Lhe
Lrlal as agalnsL Lhe Lwo defendanLs noL declared ln defaulL was ln progress sald courL granLed plalnLlffs moLlon Lo dlsmlss Lhe case ln so far as Lhe nondefaulLed defendanLs were concerned and
LhereafLer proceeded Lo hear exparLe Lhe resL of Lhe plalnLlffs evldence and subsequenLly rendered [udgmenL by defaulL agalnsL Lhe defaulLed defendanLs wlLh Lhe parLlcularlLles LhaL noLlce of Lhe
moLlon Lo dlsmlss was noL duly served on any of Lhe defendanLs who had alleged a compulsory counLerclalm agalnsL plalnLlff ln Lhelr [olnL answer and Lhe [udgmenL so rendered granLed rellefs noL
prayed for ln Lhe complalnL and (2) prohlblLlon Lo en[oln furLher proceedlngs relaLlve Lo Lhe moLlon for lmmedlaLe execuLlon of Lhe sald [udgmenL
Crlglnally Lhls llLlgaLlon was a complalnL flled on lebruary 9 1971 by respondenL 1an uL only agalnsL Lhe spousespeLlLloners AnLonlo Llm 1anhu and uy Cchay SubsequenLly ln an amended
complalnL daLed SepLember 26 1972 Lhelr son Llm 1eck Chuan and Lhe oLher spousespeLlLloners Alfonso Leonardo ng Sua and Co Cyo and Lhelr son Lng Chong Leonardo were lncluded as
defendanLs ln sald amended complalnL respondenL 1an alleged LhaL she ls Lhe wldow of 1ee Poon Llm o Chuan who was a parLner ln Lhe commerclal parLnershlp Clory Commerclal Company
wlLh AnLonlo Llm 1anhu and Alfonso ng Sua LhaL defendanL AnLonlo Llm 1anhu Alfonso Leonardo ng Sua Llm 1eck Chuan and Lng Chong Leonardo Lhrough fraud and machlnaLlon Look acLual and
acLlve managemenL of Lhe parLnershlp and alLhough 1ee Poon Llm o Chuan was Lhe manager of Clory Commerclal Company defendanLs managed Lo use Lhe funds of Lhe parLnershlp Lo purchase
lands and bulldlngs ln Lhe clLles of Cebu Lapulapu Mandaue and Lhe munlclpallLles of 1allsay and Mlnglanllla some of whlch were hldden buL Lhe descrlpLlon of Lhose already dlscovered were as
follows (llsL of properLles) and LhaL
13 (A)ftet tbe Jeotb of 1ee nooo llm lo cbooo tbe JefeoJoots wltboot llpolJotloo cootlooeJ tbe bosloess of Cloty commetclol compooy by potpotteJly otqoolzloq o
cotpototloo koowo os tbe Cloty commetclol compooy locotpototeJ wltb polJ op copltol lo tbe som of l12500000 wblcb mooey ooJ otbet ossets of tbe solJ Cloty
commetclol compooy locotpototeJ ote octoolly tbe ossets of tbe Jefooct Cloty commetclol compooy pottoetsblp of wblcb tbe plolotlff bos o sbote epolvoleot to ooe tbltJ
('/
3
) tbeteof
14 ()lalnLlff on several occaslons afLer Lhe deaLh of her husband has asked defendanLs of Lhe abovemenLloned properLles and for Lhe llquldaLlon of Lhe buslness of Lhe
defuncL parLnershlp lncludlng lnvesLmenLs on real esLaLe ln Pong kong buL defendanLs kepL on promlslng Lo llquldaLe sald properLles and [usL Lold plalnLlff Lo
13 (5)ometlme lo tbe mootb of Novembet 1967 JefeoJoots Aotoolo llm 1oobo by meoos of ftooJ Jecelt ooJ mlstepteseototloos JlJ tbeo ooJ tbete loJoce ooJ coovloce tbe
plolotlff to execote o poltclolm of oll bet tlqbts ooJ lotetests lo tbe ossets of tbe pottoetsblp of Cloty commetclol compooy wblcb ls ooll ooJ volJ execoteJ tbtooqb ftooJ ooJ
wltboot ooy leqol effect 1be otlqlool of solJ poltclolm ls lo tbe possessloo of tbe oJvetse potty JefeoJoot Aotoolo llm 1oobo
16 (A)s o mottet of foct oftet tbe execotloo of solJ poltclolm JefeoJoot Aotoolo llm 1oobo offeteJ to poy tbe plolotlff tbe omooot l6500000 wltblo o petloJ of ooe (1)
mootb fot wblcb plolotlff wos moJe to slqo o tecelpt fot tbe omooot of l6500000 oltbooqb oo socb omooot wos qlveo ooJ plolotlff wos oot eveo qlveo o copy of solJ
Jocomeot
17 (1)beteoftet lo tbe yeot 196869 tbe JefeoJoots wbo boJ eotllet ptomlseJ to llpolJote tbe ofotesolJ ptopettles ooJ ossets lo fovot omooq otbets of plolotlff and unLll Lhe
mlddle of Lhe year 1970 when Lhe plalnLlff formally demanded from Lhe defendanLs Lhe accounLlng of real and personal properLles of Lhe Clory Commerclal Company
defendanLs refused and sLaLed LhaL Lhey would noL glve Lhe share of Lhe plalnLlff (p 3637 8ecord)
She prayed as follows
WPL8LlC8L lL ls mosL respecLfully prayed LhaL [udgmenL be rendered
a) Crderlng Lhe defendanLs Lo render an accounLlng of Lhe real and personal properLles of Lhe Clory Commerclal Company lncludlng Lhose reglsLered ln Lhe names of Lhe
defendanLs and oLher persons whlch properLles are locaLed ln Lhe hlllpplnes and ln Pong kong
b) Crderlng Lhe defendanLs Lo dellver Lo Lhe plalnLlff afLer accounLlng one Lhlrd ('/
3
) of Lhe LoLal value of all Lhe properLles whlch ls approxlmaLely 300000000 represenLlng
Lhe [usL share of Lhe plalnLlff
c) Crderlng Lhe defendanLs Lo pay Lhe aLLorney of Lhe plalnLlff Lhe sum of 1wo Pundred llfLy 1housand esos (23000000) by way of aLLorneys fees and damages ln Lhe sum
of Cne Mllllon esos (100000000)
age 2 of 13

1hls Ponorable CourL ls prayed for oLher remedles and rellefs conslsLenL wlLh law and equlLy and order Lhe defendanLs Lo pay Lhe cosLs (age 38 8ecord)
1he admlsslon of sald amended complalnL was opposed by defendanLs upon Lhe ground LhaL Lhere were maLerlal modlflcaLlons of Lhe causes of acLlon prevlously alleged buL respondenL [udge
neverLheless allowed Lhe amendmenL reasonlng LhaL
1he presenL acLlon ls for accounLlng of real and personal properLles as well as for Lhe recovery of Lhe same wlLh damages
An ob[ecLlve conslderaLlon of pars 13 and 13 of Lhe amended complalnL polnLed ouL by Lhe defendanLs Lo susLaln Lhelr opposlLlon wlll show LhaL Lhe allegaLlons of facLs
Lhereln are merely Lo ampllfy maLerlal avermenLs consLlLuLlng Lhe cause of acLlon ln Lhe orlglnal complalnL lt llkewlse locloJe oecessoty ooJ loJlspeosoble JefeoJoots wltboot
wbom oo flool Jetetmlootloo coo be boJ lo tbe octloo ooJ lo otJet tbot complete tellef ls to be occotJeJ os betweeo tbose olteoJy pottles
Conslderlng LhaL Lhe amendmenLs soughL Lo be lnLroduced do noL change Lhe maln causes of acLlon ln Lhe orlglnal complalnL and Lhe rellefs demanded and Lo allow
amendmenLs ls Lhe rule and Lo refuse Lhem Lhe excepLlon and ln order LhaL Lhe real quesLlon beLween Lhe parLles may be properly and [usLly Lhreshed ouL ln a slngle
proceedlng Lo avold mulLlpllclLy of acLlons (age 40 8ecord)
ln a slngle answer wlLh counLerclalm over Lhe slgnaLure of Lhelr common counsel defendanLs denled speclflcally noL only Lhe allegaLlon LhaL respondenL 1an ls Lhe wldow of 1ee Poon because
accordlng Lo Lhem hls leglLlmaLe wlfe was Ang Slok 1ln sLlll llvlng and wlLh whom he had four (4) leglLlmaLe chlldren a Lwln born ln 1942 and Lwo oLhers born ln 1949 and 1963 all presenLly resldlng
ln Pongkong buL also all Lhe allegaLlons of fraud and converslon quoLed above Lhe LruLh belng accordlng Lo Lhem LhaL proper llquldaLlon had been regularly made of Lhe buslness of Lhe parLnershlp
and 1ee Poon used Lo recelve hls [usL share unLll hls deaLh as a resulL of whlch Lhe parLnershlp was dlssolved and whaL corresponded Lo hlm were all glven Lo hls wlfe and chlldren 1o quoLe Lhe
perLlnenL porLlons of sald answer
Anu 8? WA? Cl SLClAL Anu Alll8MA1lvL uLlLnSLS
defendanLs hereby lncorporaLe all facLs averred and alleged ln Lhe answer and furLher mosL respecLfully declare
1 1haL ln Lhe evenL LhaL plalnLlff ls flllng Lhe presenL complalnL as an helr of 1ee Poon Llm o Chuan Lhen she has no legal capaclLy Lo sue as such conslderlng LhaL Lhe
leglLlmaLe wlfe namely Ang Slok 1ln LogeLher wlLh Lhelr chlldren are sLlll allve under Sec 1 (d) 8ule 16 of Lhe 8evlsed 8ules of CourL lack of legal capaclLy Lo sue ls one of
Lhe grounds for a moLlon Lo dlsmlss and so defendanLs prays LhaL a prellmlnary hearlng be conducLed as provlded for ln Sec 3 of Lhe same rule
2 1haL ln Lhe alLernaLlve case or evenL LhaL plalnLlff ls flllng Lhe presenL case under ArL 144 of Lhe Clvll Code Lhen her clalm or demand has been pald walved abandoned or
oLherwlse exLlngulshed as evldenced by Lhe qulLclalm Annex A hereof Lhe ground clLed ls anoLher ground for a moLlon Lo dlsmlss (Sec 1 (h) 8ule 16) and hence
defendanLs pray LhaL a prellmlnary hearlng be made ln connecLlon LherewlLh pursuanL Lo SecLlon 3 of Lhe aforemenLloned rule
3 1haL 1ee Poon Llm o Chuan was legally marrled Lo Ang Slok 1ln and were blessed wlLh Lhe followlng chlldren Lo wlL Chlng Slong Llm and Chlng Plng Llm (Lwlns) born on
lebruary 16 1942 Llm Shlng lng born on March 3 1949 and Llm Lng Lu born on !une 23 1963 and presenLly resldlng ln Pongkong
4 1haL even before Lhe deaLh of 1ee Poon Llm o Chuan Lhe plalnLlff was no longer hls common law wlfe and even Lhough she was noL enLlLled Lo anyLhlng lefL by 1ee Poon
Llm o Chuan yeL ouL of Lhe klndness and generoslLy on Lhe parL of Lhe defendanLs parLlcularly AnLonlo Laln 1anhu who was lnsplrlng Lo be monk and ln facL he ls now a
monk plalnLlff was glven a subsLanLlal amounL evldenced by Lhe qulLclalm (Annex A)
3 1haL Lhe defendanLs have acqulred properLles ouL of Lhelr own personal fund and cerLalnly noL from Lhe funds belonglng Lo Lhe parLnershlp [usL as 1ee Poon Llm o Chuan
had acqulred properLles ouL of hls personal fund and whlch are now ln Lhe possesslon of Lhe wldow and nelLher Lhe defendanLs nor Lhe parLnershlp have anyLhlng Lo do abouL
sald properLles
6 1haL lL would have been lmposslble Lo buy properLles from funds belonglng Lo Lhe parLnershlp wlLhouL Lhe oLher parLners knowlng abouL lL conslderlng LhaL Lhe amounL
Laken allegedly ls qulLe blg and wlLh such blg amounL wlLhdrawn Lhe parLnershlp would have been lnsolvenL
7 1haL plalnLlff and 1ee Poon Llm o Chuan were noL blessed wlLh chlldren who would have been lawfully enLlLled Lo succeed Lo Lhe properLles lefL by Lhe laLLer LogeLher wlLh
Lhe wldow and leglLlmaLe chlldren
8 1haL desplLe Lhe facL LhaL plalnLlff knew LhaL she was no longer enLlLled Lo anyLhlng of Lhe shares of Lhe laLe 1ee Poon Llm o Chuan yeL Lhls sulL was flled agalnsL Lhe
defendanL who have Lo lnLerpose Lhe followlng
C C u n 1 L 8 C L A l M
A 1haL Lhe defendanLs hereby reproduced by way of reference all Lhe allegaLlons and foregolng avermenLs as parL of Lhls counLerclalm
8 1haL plalnLlff knew and was aware she was merely Lhe commonlaw wlfe of 1ee Poon Llm o Chuan and LhaL Lhe lawful and legal ls sLlll llvlng LogeLher wlLh Lhe leglLlmaLe
chlldren and yeL she dellberaLely suppressed Lhls facL Lhus showlng her bad falLh and ls Lherefore llable for exemplary damages ln an amounL whlch Lhe Ponorable CourL may
deLermlne ln Lhe exerclse of lLs sound [udlclal dlscreLlon ln Lhe evenL LhaL plalnLlff ls marrled Lo 1ee Poon Llm o Chuan Lhen her marrlage ls blgamous and should suffer Lhe
consequences Lhereof
C 1haL plalnLlff was aware and had knowledge abouL Lhe qulLclalm even Lhough she was noL enLlLled Lo lL and yeL she falsely clalmed LhaL defendanLs refused even Lo see
her and for flllng Lhls unfounded baseless fuLlle and puerlle complalnL defendanLs suffered menLal angulsh and LorLure conservaLlvely esLlmaLed Lo be noL less Lhan
300000
u 1haL ln order Lo defend Lhelr rlghLs ln courL defendanLs were consLralned Lo engage Lhe servlces of Lhe underslgned counsel obllgaLlng Lhemselves Lo pay 30000000 as
aLLorneys fees
age 3 of 13

L 1haL by way of llLlgaLlon expenses durlng Lhe Llme LhaL Lhls case wlll be before Lhls Ponorable CourL and unLll Lhe same wlll be flnally LermlnaLed and ad[udlcaLed
defendanLs wlll have Lo spend aL leasL 300000 (p 4447 8ecord)
AfLer unsuccessfully Lrylng Lo show LhaL Lhls counLerclalm ls merely permlsslve and should be dlsmlssed for nonpaymenL of Lhe correspondlng flllng fee and afLer belng overruled by Lhe courL ln due
Llme plalnLlff answered Lhe same denylng lLs maLerlal allegaLlons
Cn lebruary 3 1973 however Lhe daLe seL for Lhe preLrlal boLh of Lhe Lwo defendanLsspouses Lhe Llm 1anhus and ng Suas dld noL appear for whlch reason upon moLlon of plalnLlff daLed
lebruary 16 1973 ln an order of March 12 1973 Lhey were all declared ln uLlAuL1 as of lebruary 3 1973 when Lhey falled Lo appear aL Lhe preLrlal 1hey soughL Lo hlve Lhls order llfLed Lhru a
moLlon for reconslderaLlon buL Lhe efforL falled when Lhe courL denled lL 1hereafLer Lhe Lrlal sLarLed buL aL Lhe sLage Lhereof where Lhe flrsL wlLness of Lhe plalnLlff by Lhe name of AnLonlo nunez
who LesLlfled LhaL he ls her adopLed son was up for recrossexamlnaLlon sald plalnLlff unexpecLedly flled on CcLober 19 1974 Lhe followlng slmple and unreasoned
MC1lCn 1C u8C uLlLnuAn1S LlM 1LCk
CPuAn Anu LnC CPCnC LLCnA8uC
CCMLS now plalnLlff Lhrough her underslgned counsel unLo Lhe Ponorable CourL mosL respecLfully moves Lo drop from Lhe complalnL Lhe defendanLs Llm 1eck Chuan and
Lng Chong Leonardo and Lo conslder Lhe case dlsmlssed lnsofar as sald defendanLs Llm 1eck Chuan and Lng Chong Leonardo are concerned
WPL8LlC8L lL ls mosL respecLfully prayed of Lhe Ponorable CourL Lo drop from Lhe complalnL Lhe defendanLs Llm 1eck Chuan and Lng Chong Leonardo and Lo dlsmlss Lhe
case agalnsL Lhem wlLhouL pronouncemenL as Lo cosLs (age 30 8ecord)
whlch she seL for hearlng on uecember 21 1974 Accordlng Lo peLlLloners none of Lhe defendanLs declared ln defaulL were noLlfled of sald moLlon ln vlolaLlon of SecLlon 9 of
8ule 13 slnce Lhey had asked for Lhe llfLlng of Lhe order of defaulL albelL unsuccessfully and as regards Lhe defendanLs noL declared ln defaulL Lhe seLLlng of Lhe hearlng of
sald moLlon on CcLober 21 1974 lnfrlnged Lhe Lhreeday requlremenL of SecLlon 4 of 8ule 13 lnasmuch as ALLy Adellno SlLoy of Llm 1eck Chuan was served wlLh a copy of Lhe
moLlon personally only on CcLober 19 1974 whlle ALLy 8en[amln Alcudla of Lng Chong Leonardo was served by reglsLered mall senL only on Lhe same daLe
LvldenLly wlLhouL even verlfylng Lhe noLlces of servlce [usL as slmply as plalnLlff had couched her moLlon and also wlLhouL any legal grounds sLaLed respondenL courL granLed
Lhe prayer of Lhe above moLlon Lhus
C8uL8
AcLlng on Lhe moLlon of Lhe plalnLlff praylng for Lhe dlsmlssal of Lhe complalnL as agalnsL defendanLs Llm 1eck Chuan and Lng Chong Leonardo
1he same ls hereby C8An1Lu 1he complalnL as agalnsL defendanL Llm 1eck Chuan and Lng Chong Leonardo ls hereby ordered ulSMlSSLu wlLhouL pronouncemenL as Lo
cosLs
SlmulLaneously Lhe followlng order was also lssued
Conslderlng LhaL defendanLs AnLonlo Llm 1anhu and hls spouse uy Cchay as well as defendanLs Alfonso ng Sua and hls spouse Co Cyo have been declared ln defaulL for fallure
Lo appear durlng Lhe preLrlal and as Lo Lhe oLher defendanLs Lhe complalnL had already been ordered dlsmlssed as agalnsL Lhem
LeL Lhe hearlng of Lhe plalnLlffs evldence expotte be seL on november 20 1974 aL 830 AM before Lhe 8ranch Clerk of CourL who ls depuLlzed for Lhe purpose Lo swear ln
wlLnesses and Lo submlL her reporL wlLhln Len (10) days LhereafLer noLlfy Lhe plalnLlff
SC C8uL8Lu
Cebu ClLy hlllpplnes CcLober 21 1974 (age 32 8ecord)
8uL ln connecLlon wlLh Lhls lasL order Lhe scheduled exparLe recepLlon of evldence dld noL Lake place on november 20 1974 for on CcLober 28 1974 upon verbal moLlon of plalnLlff Lhe courL
lssued Lhe followlng selfexplanaLory order
AcLlng favorably on Lhe moLlon of Lhe plalnLlff daLed CcLober 18 1974 Lhe CourL depuLlzed Lhe 8ranch Clerk of CourL Lo recelve Lhe evldence of Lhe plalnLlff expotte Lo be
made on november 20 1974 Powever on CcLober 28 1974 Lhe plalnLlff LogeLher wlLh her wlLnesses appeared ln courL and asked Lhru counsel LhaL she be allowed Lo
presenL her evldence
Conslderlng Lhe Llme and expenses lncurred by Lhe plalnLlff ln brlnglng her wlLnesses Lo Lhe courL Lhe 8ranch Clerk of CourL ls hereby auLhorlzed Lo recelve lmmedlaLely Lhe
evldence of Lhe plalnLlff expotte
SC C8uL8Lu
Cebu ClLy hlllpplnes CcLober 28 1974 (age 33 8ecord)
upon learnlng of Lhese orders on CcLober 23 1973 Lhe defendanL Llm 1eck Cheng Lhru counsel ALLy SlLoy flled a moLlon for reconslderaLlon Lhereof and on november 1 1974 defendanL Lng
Chong Leonardo Lhru counsel ALLy Alcudla flled also hls own moLlon for reconslderaLlon and clarlflcaLlon of Lhe same orders 1hese moLlons were denled ln an order daLed uecember 6 1974 buL
recelved by Lhe movanLs only on uecember 23 1974 Meanwhlle respondenL courL rendered Lhe lmpugned declslon on uecember 20 1974 lL does noL appear when Lhe parLles were served coples of
Lhls declslon
SubsequenLly on !anuary 6 1973 all Lhe defendanLs Lhru counsel flled a moLlon Lo quash Lhe order of CcLober 28 1974 WlLhouL walLlng however for Lhe resoluLlon Lhereof on !anuary 13 1974
Llm 1eck Chuan and Lng Chong Leonardo wenL Lo Lhe CourL of Appeals wlLh a peLlLlon for cerLlorarl seeklng Lhe annulmenL of Lhe abovemenLloned orders of CcLober 21 1974 and CcLober 28 1974
age 4 of 13

and declslon of uecember 20 1974 8y resoluLlon of !anuary 24 1973 Lhe CourL of Appeals dlsmlssed sald peLlLlon holdlng LhaL lLs flllng was premaLure conslderlng LhaL Lhe moLlon Lo quash Lhe
order of CcLober 28 1974 was sLlll unresolved by Lhe Lrlal courL 1hls holdlng was relLeraLed ln Lhe subsequenL resoluLlon of lebruary 3 1973 denylng Lhe moLlon for reconslderaLlon of Lhe prevlous
dlsmlssal
Cn Lhe oLher hand on !anuary 20 1973 Lhe oLher defendanLs peLlLloners hereln flled Lhelr noLlce of appeal appeal bond and moLlon for exLenslon Lo flle Lhelr record on appeal whlch was granLed
Lhe exLenslon Lo explre afLer flfLeen (13) days from !anuary 26 and 27 1973 for defendanLs Llm 1anhu and ng Suas respecLlvely 8uL on lebruary 7 1973 before Lhe perfecLlon of Lhelr appeal
peLlLloners flled Lhe presenL peLlLlon wlLh Lhls CourL And wlLh Lhe evldenL lnLenL Lo make Lhelr procedural poslLlon clear counsel for defendanLs ALLy Manuel Zosa flled wlLh respondenL courL a
manlfesLaLlon daLed lebruary 14 1973 sLaLlng LhaL when Lhe nondefaulLed defendanLs Lng Chong Leonardo and Llm 1eck Chuan flled Lhelr peLlLlon ln Lhe CourL of Appeals Lhey ln effecL abandoned
Lhelr moLlon Lo quash Lhe order of CcLober 28 1974 and LhaL slmllarly when AnLonlo Llm 1anhu uy Cchay Alfonso Leonardo ng Sua and Co Cyo flled Lhelr peLlLlon for cettlototl and prohlblLlon
ln Lhe Supreme CourL Lhey llkewlse abandoned Lhelr moLlon Lo quash 1hls manlfesLaLlon was acLed upon by respondenL courL LogeLher wlLh plalnLlffs moLlon for execuLlon pendlng appeal ln lLs
order of Lhe same daLe lebruary 14 1973 Lhls wlse
C8uL8
When Lhese lncldenLs Lhe moLlon Lo quash Lhe order of CcLober 28 1974 and Lhe moLlon for execuLlon pendlng appeal were called for hearlng Loday counsel for Lhe
defendanLsmovanLs submlLLed Lhelr manlfesLaLlon lnvlLlng Lhe aLLenLlon of Lhls CourL LhaL by Lhelr flllng for cerLlorarl and prohlblLlon wlLh prellmlnary ln[uncLlon ln Lhe CourL
of Appeals whlch was dlsmlssed and laLer Lhe defaulLed defendanLs flled wlLh Lhe Supreme CourL cerLlorarl wlLh prohlblLlon Lhey ln effecL abandoned Lhelr moLlon Lo quash
ln vlLW PL8LCl Lhe moLlon Lo quash ls ordered A8AnuCnLu 1he resoluLlon of Lhe moLlon for execuLlon pendlng appeal shall be resolved afLer Lhe peLlLlon for cerLlorarl
and prohlblLlon shall have been resolved by Lhe Supreme CourL
SC C8uL8Lu
Cebu ClLy hlllpplnes lebruary 14 1973 (age 216 8ecord)
upon Lhese premlses lL ls Lhe poslLlon of peLlLloners LhaL respondenL courL acLed lllegally ln vlolaLlon of Lhe rules or wlLh grave abuse of dlscreLlon ln acLlng on respondenLs moLlon Lo dlsmlss of
CcLober 18 1974 wlLhouL prevlously ascerLalnlng wheLher or noL due noLlce Lhereof had been served on Lhe adverse parLles as ln facL no such noLlce was Llmely served on Lhe nondefaulLed
defendanLs Llm 1eck Chuan and Lng Chong Leonardo and no noLlce aL all was ever senL Lo Lhe oLher defendanLs hereln peLlLloners and more so ln acLually orderlng Lhe dlsmlssal of Lhe case by lLs
order of CcLober 21 1974 and aL Lhe same Llme seLLlng Lhe case for furLher hearlng as agalnsL Lhe defaulLed defendanLs hereln peLlLloners acLually hearlng Lhe same expotte and LhereafLer
renderlng Lhe declslon of uecember 20 1974 granLlng respondenL 1an even rellefs noL prayed for ln Lhe complalnL Accordlng Lo Lhe peLlLloners Lo begln wlLh Lhere was compulsory counLerclalm ln
Lhe common answer of Lhe defendanLs Lhe naLure of whlch ls such LhaL lL cannoL be declded ln an lndependenL acLlon and as Lo whlch Lhe aLLenLlon of respondenL courL was duly called ln Lhe moLlons
for reconslderaLlon 8esldes and more lmporLanLly under SecLlon 4 of 8ule 18 respondenL courL had no auLhorlLy Lo dlvlde Lhe case before lL by dlsmlsslng Lhe same as agalnsL Lhe nondefaulLed
defendanLs and LhereafLer proceedlng Lo hear lL exparLe and subsequenLly renderlng [udgmenL agalnsL Lhe defaulLed defendanLs conslderlng LhaL ln Lhelr vlew under Lhe sald provlslon of Lhe rules
when a common cause of acLlon ls alleged agalnsL several defendanLs Lhe defaulL of any of Lhem ls a mere formallLy by whlch Lhose defaulLed are noL allowed Lo Lake parL ln Lhe proceedlngs buL
oLherwlse all Lhe defendanLs defaulLed and noL defaulLed are supposed Lo have buL a common faLe wln or lose ln oLher words peLlLloners poslL LhaL ln such a slLuaLlon Lhere can only be one
common [udgmenL for or agalnsL all Lhe defendanL Lhe nondefaulLed and Lhe defaulLed 1hus peLlLloners conLend LhaL Lhe order of dlsmlssal of CcLober 21 1974 should be consldered also as Lhe
flnal [udgmenL lnsofar as Lhey are concerned or ln Lhe alLernaLlve lL should be seL aslde LogeLher wlLh all Lhe proceedlngs and declslon held and rendered subsequenL LhereLo and LhaL Lhe Lrlal be
resumed as of sald daLe wlLh Lhe defendanLs Llm 1eck Chuan and Lng Chong Leonardo belng allowed Lo defend Lhe case for all Lhe defendanLs
Cn Lhe oLher hand prlvaLe respondenL malnLalns Lhe conLrary vlew LhaL lnasmuch as peLlLloners had been properly declared ln defaulL Lhey have no personallLy nor lnLeresL Lo quesLlon Lhe dlsmlssal
of Lhe case as agalnsL Lhelr nondefaulLed codefendanLs and should suffer Lhe consequences of Lhelr own defaulL 8espondenL furLher conLends and Lhls ls Lhe only poslLlon dlscussed ln Lhe
memorandum submlLLed by her counsel LhaL slnce peLlLloners have already made or aL leasL sLarLed Lo make Lhelr appeal as Lhey are ln facL enLlLled Lo appeal Lhls speclal clvll acLlon has no reason
for belng AddlLlonally she lnvokes Lhe polnL of premaLurlLy upheld by Lhe CourL of Appeals ln regard Lo Lhe abovemenLloned peLlLlon Lhereln of Lhe nondefaulLed defendanLs Llm 1eck Chuan and
Lng Chong Leonardo llnally she argues LhaL ln any evenL Lhe errors aLLrlbuLed Lo respondenL courL are errors of [udgmenL and may be revlewed only ln an appeal
AfLer careful scruLlny of all Lhe aboverelaLed proceedlngs ln Lhe courL below and maLure dellberaLlon Lhe CourL has arrlved aL Lhe concluslon LhaL peLlLloners should be granLed rellef lf only Lo sLress
emphaLlcally once more LhaL Lhe rules of procedure may noL be mlsused and abused as lnsLrumenLs for Lhe denlal of subsLanLlal [usLlce A revlew of Lhe record of Lhls case lmmedlaLely dlscloses LhaL
here ls anoLher demonsLraLlve lnsLance of how some members of Lhe bar avalllng of Lhelr proflclency ln lnvoklng Lhe leLLer of Lhe rules wlLhouL regard Lo Lhelr real splrlL and lnLenL succeed ln
lnduclng courLs Lo acL conLrary Lo Lhe dlcLaLes of [usLlce and equlLy and ln some lnsLances Lo wlLLlngly or unwlLLlngly abeL unfalr advanLage by lronlcally camouflaglng Lhelr acLuaLlons as earnesL
efforLs Lo saLlsfy Lhe publlc clamor for speedy dlsposlLlon of llLlgaLlons forgeLLlng all Lhe whlle LhaL Lhe plaln ln[uncLlon of SecLlon 2 of 8ule 1 ls LhaL Lhe rules shall be llberally consLrued ln order Lo
promoLe Lhelr ob[ecL and Lo asslsL Lhe parLles ln obLalnlng noL only speedy buL more lmperaLlvely [usL and lnexpenslve deLermlnaLlon of every acLlon and proceedlng We cannoL slmply pass over
Lhe lmpresslon LhaL Lhe procedural maneuvers and LacLlcs revealed ln Lhe records of Lhe case aL bar were dellberaLely planned wlLh Lhe calculaLed end ln vlew of deprlvlng peLlLloners and Lhelr co
defendanLs below of every opporLunlLy Lo properly defend Lhemselves agalnsL a clalm of more Lhan subsLanLlal characLer conslderlng Lhe mllllons of pesos worLh of properLles lnvolved as found by
respondenL [udge hlmself ln Lhe lmpugned declslon a clalm LhaL appears ln Lhe llghL of Lhe allegaLlons of Lhe answer and Lhe documenLs already broughL Lo Lhe aLLenLlon of Lhe courL aL Lhe preLrlal
Lo be raLher dublous WhaL ls mosL regreLLable ls LhaL apparenLly all of Lhese alarmlng clrcumsLances have escaped respondenL [udge who dld noL seem Lo have heslLaLed ln acLlng favorably on Lhe
moLlons of Lhe plalnLlff conduclve Lo Lhe deplorable ob[ecLlve [usL menLloned and whlch moLlons aL Lhe very leasL appeared Lo be of hlghly conLroverslal merlL conslderlng LhaL Lhelr obvlous
Lendency and lmmedlaLe resulL would be Lo converL Lhe proceedlngs lnLo a oneslded affalr a slLuaLlon LhaL should be readlly condemnable and lnLolerable Lo any courL of [usLlce
lndeed a seemlng dlsposlLlon on Lhe parL of respondenL courL Lo lean more on Lhe conLenLlons of prlvaLe respondenL may be dlscerned from Lhe manner lL resolved Lhe aLLempLs of defendanLs uy
Cchay and AnLonlo Llm 1anhu Lo have Lhe earller order of defaulL agalnsL Lhem llfLed noLwlLhsLandlng LhaL uy Cchays moLlon of CcLober 8 1971 coslgned by her wlLh Lhelr counsel ALLy !ovenclo
Ln[ambre (Annex 2 of respondenL answer hereln) was over Lhe [uraL of Lhe noLary publlc before whom she Look her oaLh ln Lhe order of november 2 1971 (Annex 3 lJ) lL was held LhaL Lhe oaLh
appearlng aL Lhe boLLom of Lhe moLlon ls noL Lhe one conLemplaLed by Lhe abovequoLed perLlnenL provlslon (See 3 8ule 18) of Lhe rules lL ls noL even a verlflcaLlon (See 6 8ule 7) WhaL Lhe rule
requlres as lnLerpreLed by Lhe Supreme CourL ls LhaL Lhe moLlon musL have Lo be accompanled by an affldavlL of merlLs LhaL Lhe defendanL has a merlLorlous defense Lhereby lgnorlng Lhe very slmple
legal polnL LhaL Lhe rullng of Lhe Supreme CourL ln Ooq leoq vs costoJlo 1 SC8A 781 relled upon by Pls Ponor under whlch a separaLe affldavlL of merlL ls requlred refers obvlously Lo lnsLances
where Lhe moLlon ls noL over oaLh of Lhe parLy concerned conslderlng LhaL whaL Lhe clLed provlslon llLerally requlres ls no more Lhan a moLlon under oaLh SLaLed oLherwlse when a moLlon Lo llfL an
order of defaulL conLalns Lhe reasons for Lhe fallure Lo answer as well as Lhe facLs consLlLuLlng Lhe prospecLlve defense of Lhe defendanL and lL ls sworn Lo by sald defendanL nelLher a formal
verlflcaLlon nor a separaLe affldavlL of merlL ls necessary
WhaL ls worse Lhe same order furLher held LhaL Lhe moLlon Lo llfL Lhe order of defaulL ls an admlsslon LhaL Lhere was a valld servlce of summons and LhaL sald moLlon could noL amounL Lo a
challenge agalnsL Lhe [urlsdlcLlon of Lhe courL over Lhe person of Lhe defendanL Such a raLlonallzaLlon ls paLenLly speclous and reveals an evldenL fallure Lo grasp Lhe lmporL of Lhe legal concepLs
lnvolved A moLlon Lo llfL an order of defaulL on Lhe ground LhaL servlce of summons has noL been made ln accordance wlLh Lhe rules ls ln order and ls ln essence verlly an aLLack agalnsL Lhe [urlsdlcLlon
of Lhe courL over Lhe person of Lhe defendanL no less Lhan lf lL were worded ln a manner speclflcally embodylng such a dlrecL challenge
And Lhen ln Lhe order of lebruary 14 1972 (Annex 6 lJ) llfLlng aL lasL Lhe order of defaulL as agalnsL defendanL Llm 1anhu Pls Ponor poslLed LhaL sald defendanL has a defense (qulLclalm) whlch
renders Lhe clalm of Lhe plalnLlff conLenLlous We have read defendanLs moLlon for reconslderaLlon of november 23 1971 (Annex 3 lJ) buL We cannoL flnd ln lL any reference Lo a qulLclalm
age S of 13

8aLher Lhe allegaLlon of a qulLclalm ls ln Lhe amended complalnL (ars 1316 Annex 8 of Lhe peLlLlon hereln) ln whlch plalnLlff malnLalns LhaL her slgnaLure LhereLo was secured Lhrough fraud and
decelL ln LruLh Lhe moLlon for reconslderaLlon [usL menLloned Annex 3 merely relLeraLed Lhe allegaLlon ln uy Cchays earller moLlon of CcLober 8 1971 Annex 2 Lo seL aslde Lhe order of defaulL
LhaL plalnLlff 1an could be buL Lhe common law wlfe only of 1ee Poon slnce hls leglLlmaLe wlfe was sLlll allve whlch allegaLlon Pls Ponor held ln Lhe order of november 2 1971 Annex 3 Lo be noL
good and merlLorlous defense 1o Lop lL all whereas as already sLaLed Lhe order of lebruary 19 1972 Annex 6 llfLed Lhe defaulL agalnsL Llm 1anhu because of Lhe addlLlonal conslderaLlon LhaL he
has a defense (qulLclalm) whlch renders Lhe clalm of Lhe plalnLlff conLenLlous Lhe defaulL of uy Cchay was malnLalned noLwlLhsLandlng LhaL exacLly Lhe same conLenLlons defense as LhaL of her
husband was lnvoked by her
Such Lenuous lf noL alLogeLher erroneous reasonlngs and manlfesL lnconslsLency ln Lhe legal posLures ln Lhe orders ln quesLlon can hardly convlnce us LhaL Lhe maLLers here ln lssue were accorded
due and proper conslderaLlon by respondenL courL ln facL under Lhe clrcumsLances hereln obLalnlng lL seems approprlaLe Lo sLress LhaL havlng ln vlew Lhe raLher subsLanLlal value of Lhe sub[ecL
maLLer lnvolved LogeLher wlLh Lhe obvlously conLenLlous characLer of plalnLlffs clalm whlch ls dlscernlble even on Lhe face of Lhe complalnL lLself uLmosL care should have been Laken Lo avold Lhe
sllghLesL susplclon of lmproper moLlvaLlons on Lhe parL of anyone concerned upon Lhe conslderaLlons hereunder Lo follow Lhe CourL expresses lLs grave concern LhaL much has Lo be done Lo dlspel
Lhe lmpresslon LhaL hereln peLlLloners and Lhelr codefendanLs are belng rallroaded ouL of Lhelr rlghLs and properLles wlLhouL due process of law on Lhe sLrengLh of procedural LechnlcallLles adrolLly
planned by counsel and seemlngly unnoLlced and undeLecLed by respondenL courL whose orders gauged by Lhelr Lenor and Lhe clLaLlons of supposedly perLlnenL provlslons and [urlsprudence made
Lhereln cannoL be sald Lo have proceeded from uLLer lack of [urldlcal knowledgeablllLy and compeLence
1
1he flrsL Lhlng LhaL has sLruck Lhe CourL upon revlewlng Lhe record ls Lhe seemlng alacrlLy wlLh whlch Lhe moLlon Lo dlsmlss Lhe case agalnsL nondefaulLed defendanLs Llm 1eck Chuan and Lng Chong
Leonardo was dlsposed of whlch deflnlLely oughL noL Lo have been Lhe case 1he Lrlal was proceedlng wlLh Lhe LesLlmony of Lhe flrsL wlLness of plalnLlff and he was sLlll under recrossexamlnaLlon
undoubLedly Lhe moLlon Lo dlsmlss aL LhaL sLage and ln Lhe llghL of Lhe declaraLlon of defaulL agalnsL Lhe resL of Lhe defendanLs was a well calculaLed surprlse move obvlously deslgned Lo secure
uLmosL advanLage of Lhe slLuaLlon regardless of lLs apparenL unfalrness 1o say LhaL lL musL have been enLlrely unexpecLed by all Lhe defendanLs defaulLed and nondefaulLed ls merely Lo rlghLly
assume LhaL Lhe parLles ln a [udlclal proceedlng can never be Lhe vlcLlms of any procedural waylaylng as long as lawyers and [udges are lmbued wlLh Lhe requlslLe sense of equlLy and [usLlce
8uL Lhe slLuaLlon here was aggravaLed by Lhe lndlspuLable facL LhaL Lhe adverse parLles who were enLlLled Lo be noLlfled of such unanLlclpaLed dlsmlssal moLlon dld noL geL due noLlce Lhereof
CerLalnly Lhe nondefaulLed defendanLs had Lhe rlghL Lo Lhe Lhreeday prlor noLlce requlred by SecLlon 4 of 8ule 13 Pow could Lhey have had such lndlspensable noLlce when Lhe moLlon was seL for
hearlng on Monday CcLober 21 1974 whereas Lhe counsel for Llm 1eck Chuan ALLy SlLoy was personally served wlLh Lhe noLlce only on SaLurday CcLober 19 1974 and Lhe counsel for Lng Chong
Leonardo ALLy Alcudla was noLlfled by reglsLered mall whlch was posLed only LhaL same SaLurday CcLober 19 1974? Accordlng Lo Chlef !usLlce Moran Lhree days aL leasL musL lnLervene beLween
Lhe daLe of servlce of noLlce and Lhe daLe seL for Lhe hearlng oLherwlse Lhe courL may noL valldly acL on Lhe moLlon (CommenLs on Lhe 8ules of CourL by Moran vol 1 1970 ed p 474) Such ls Lhe
correcL consLrucLlon of SecLlon 4 of 8ule 13 And ln Lhe lnsLanL case Lhere can be no quesLlon LhaL Lhe noLlces Lo Lhe nondefaulLed defendanLs were shorL of Lhe requlremenL of sald provlslon
We can undersLand Lhe overanxleLy of counsel for plalnLlff buL whaL ls lncomprehenslble ls Lhe seemlng lnaLLenLlon of respondenL [udge Lo Lhe expllclL mandaLe of Lhe perLlnenL rule noL Lo speak of
Lhe lmperaLlves of falrness conslderlng he should have reallzed Lhe farreachlng lmpllcaLlons speclally from Lhe polnL of vlew he subsequenLly adopLed albelL erroneously of hls favorably acLlng on lL
AcLually he was aware of sald consequences for slmulLaneously wlLh hls order of dlsmlssal he lmmedlaLely seL Lhe case for Lhe exparLe hearlng of Lhe evldence agalnsL Lhe defaulLed defendanLs
whlch lncldenLally from Lhe Lenor of hls order whlch We have quoLed above appears Lo have been done by hlm moLu proplo As a maLLer of facL plalnLlffs moLlon also quoLed above dld noL pray for
lL
WlLhal respondenL courLs Lwln acLlons of CcLober 21 1974 furLher lgnores or ls lnconslsLenL wlLh a number of known [urldlcal prlnclples concernlng defaulLs whlch We wlll here Lake occaslon Lo
relLeraLe and furLher elucldaLe on lf only Lo avold a repeLlLlon of Lhe unforLunaLe errors commlLLed ln Lhls case erhaps some of Lhese prlnclples have noL been amply pro[ecLed and elaboraLed
before and such pauclLy of elucldaLlon could be Lhe reason why respondenL [udge musL have acLed as he dld SLlll Lhe CourL cannoL buL express lLs vehemenL condemnaLlon of any [udlclal acLuaLlon
LhaL unduly deprlves any parLy of Lhe rlghL Lo be heard wlLhouL clear and speclflc warranL under Lhe Lerms of exlsLlng rules or blndlng [urlsprudence LxLreme care musL be Lhe lnsLanL reacLlon of every
[udge when confronLed wlLh a slLuaLlon lnvolvlng rlsks LhaL Lhe proceedlngs may noL be falr and square Lo all Lhe parLles concerned lndeed a keen sense of falrness equlLy and [usLlce LhaL consLanLly
looks for conslsLency beLween Lhe leLLer of Lhe ad[ecLlve rules and Lhese baslc prlnclples musL be possessed by every [udge lf subsLance ls Lo prevall as lL musL over form ln our courLs LlLeral
observance of Lhe rules when lL ls conduclve Lo unfalr and undue advanLage on Lhe parL of any llLlganL before lL ls unworLhy of any courL of [usLlce and equlLy WlLhal only Lhose rules and procedure
lnformed wlLh and founded on publlc pollcy deserve obedlence ln accord wlLh Lhelr unequlvocal language or words
8efore proceedlng Lo Lhe dlscusslon of Lhe defaulL aspecLs of Lhls case however lL should noL be amlss Lo adverL flrsL Lo Lhe paLenL lncorrecLness apparenL on Lhe face of Lhe record of Lhe
aforemenLloned order of dlsmlssal of CcLober 21 1974 of Lhe case below as regards nondefaulLed defendanLs Llm and Leonardo Whlle lL ls Lrue LhaL sald defendanLs are noL peLlLloners hereln Lhe
CourL deems lL necessary for a full vlew of Lhe ouLrageous procedural sLraLegy concelved by respondenLs counsel and sancLloned by respondenL courL Lo also make reference Lo Lhe very evldenL facL
LhaL ln orderlng sald dlsmlssal respondenL courL dlsregarded compleLely Lhe exlsLence of defendanLs counLerclalm whlch lL had lLself earller held lf lndlrecLly Lo be compulsory ln naLure when lL
refused Lo dlsmlss Lhe same on Lhe ground alleged by respondenL 1an LhaL he dockeLlng fees for Lhe flllng Lhereof had noL been pald by defendanLs
lndeed LhaL sald counLerclalm ls compulsory needs no exLended elaboraLlon As may be noLed ln Lhe allegaLlons hereof aforequoLed lL arose ouL of or ls necessarlly connecLed wlLh Lhe occurrence
LhaL ls Lhe sub[ecL maLLer of Lhe plalnLlffs clalm (SecLlon 4 8ule 9) namely plalnLlffs allegedly belng Lhe wldow of Lhe deceased 1ee Poon enLlLled as such Lo demand accounLlng of and Lo recelve
Lhe share of her alleged laLe husband as parLner of defendanLs AnLonlo Llm 1anhu and Alfonso Leonardo ng Sua ln Clory Commerclal Company Lhe LruLh of whlch allegaLlons all Lhe defendanLs have
denled uefendanLs malnLaln ln Lhelr counLerclalm LhaL plalnLlff knew of Lhe falslLy of sald allegaLlons even before she flled her complalnL for she had ln facL admlLLed her commonlaw relaLlonshlp
wlLh sald deceased ln a documenL she had [olnLly execuLed wlLh hlm by way of agreemenL Lo LermlnaLe Lhelr llleglLlmaLe relaLlonshlp for whlch she recelved 40000 from Lhe deceased and wlLh
respecL Lo her preLended share ln Lhe caplLal and proflLs ln Lhe parLnershlp lL ls also defendanLs posLure LhaL she had already qulLclalmed wlLh Lhe asslsLance of able counsel whaLever rlghLs lf any
she had LhereLo ln november 1967 for Lhe sum of 23000 duly recelpLed by her whlch qulLclalm was however execuLed accordlng Lo respondenL herself ln her amended complalnL Lhrough fraud
And havlng flled her complalnL knowlng accordlng Lo defendanLs as she oughL Lo have known LhaL Lhe maLerlal allegaLlons Lhereof are false and baseless she has caused Lhem Lo suffer damages
undoubLedly wlLh such allegaLlons defendanLs counLerclalm ls compulsory noL only because Lhe same evldence Lo susLaln lL wlll also refuLe Lhe cause or causes of acLlon alleged ln plalnLlffs
complalnL (Moran sopto p 332) buL also because from lLs very naLure lL ls obvlous LhaL Lhe same cannoL remaln pendlng for lndependenL ad[udlcaLlon by Lhe courL (SecLlon 2 8ule 17)
1he provlslon of Lhe rules [usL clLed speclflcally en[olns LhaL (l)f a counLerclalm has been pleaded by a defendanL prlor Lo Lhe servlce upon hlm of Lhe plalnLlffs moLlon Lo dlsmlss Lhe acLlon shall noL
be dlsmlssed agalnsL Lhe defendanLs ob[ecLlon unless Lhe counLerclalm can remaln pendlng for lndependenL ad[udlcaLlon by Lhe courL uefendanLs Llm and Leonardo had no opporLunlLy Lo ob[ecL Lo
Lhe moLlon Lo dlsmlss before Lhe order granLlng Lhe same was lssued for Lhe slmple reason LhaL Lhey were noL opporLunlLy noLlfled of Lhe moLlon Lherefor buL Lhe record shows clearly LhaL aL leasL
defendanL Llm lmmedlaLely broughL Lhe maLLer of Lhelr compulsory counLerclalm Lo Lhe aLLenLlon of Lhe Lrlal courL ln hls moLlon for reconslderaLlon of CcLober 23 1974 even as Lhe counsel for Lhe
oLher defendanL Leonardo predlcaLed hls moLlon on oLher grounds ln lLs order of uecember 6 1974 however respondenL courL noL only upheld Lhe plalnLlffs supposed absoluLe rlghL Lo choose her
adversarles buL also held LhaL Lhe counLerclalm ls noL compulsory Lhereby vlrLually maklng unexplalned and lnexpllcable 180degree LurnabouL ln LhaL respecL
1here ls anoLher equally fundamenLal conslderaLlon why Lhe moLlon Lo dlsmlss should noL have been granLed As Lhe plalnLlffs complalnL has been framed all Lhe slx defendanLs are charged wlLh
havlng acLually Laken parL ln a consplracy Lo mlsapproprlaLe conceal and converL Lo Lhelr own beneflL Lhe proflLs properLles and all oLher asseLs of Lhe parLnershlp Clory Commerclal Company Lo Lhe
exLenL LhaL Lhey have allegedly organlzed a corporaLlon Clory Commerclal Company lnc wlLh whaL Lhey had lllegally goLLen from Lhe parLnershlp upon such allegaLlons no [udgmenL flndlng Lhe
exlsLence of Lhe alleged consplracy or holdlng Lhe caplLal of Lhe corporaLlon Lo be Lhe money of Lhe parLnershlp ls legally posslble wlLhouL Lhe presence of all Lhe defendanLs 1he nondefaulLed
defendanLs are alleged Lo be sLockholders of Lhe corporaLlon and any declslon deprlvlng Lhe same of all lLs asseLs cannoL buL pre[udlce Lhe lnLeresLs of sald defendanLs Accordlngly upon Lhese
premlses and even presclndlng from Lhe oLher reasons Lo be dlscussed anon lL ls clear LhaL all Lhe slx defendanLs below defaulLed and nondefaulLed are lndlspensable parLles 8espondenLs could do
no less Lhan granL LhaL Lhey are so on page 23 of Lhelr answer Such belng Lhe case Lhe quesLloned order of dlsmlssal ls exacLly Lhe opposlLe of whaL oughL Lo have been done Whenever lL appears Lo
age of 13

Lhe courL ln Lhe course of a proceedlng LhaL an lndlspensable parLy has noL been [olned lL ls Lhe duLy of Lhe courL Lo sLop Lhe Lrlal and Lo order Lhe lncluslon of such parLy (1he 8evlsed 8ules of CourL
AnnoLaLed CommenLed by SenaLor vlcenLe ! lranclsco vol 1 p 271 1973 ed See also CorLez vs Avlla 101 hll 703) Such an order ls unavoldable for Lhe general rule wlLh reference Lo Lhe
maklng of parLles ln a clvll acLlon requlres Lhe [olnder of all necessary parLles wherever posslble and Lhe [olnder of all lndlspensable parLles under any and all condlLlons Lhe presence of Lhose laLLer
belng a sloe poo ooo of Lhe exerclse of [udlclal power (8orlasa vs ollsLlco 47 hll 343 aL p 347) lL ls preclsely when an lndlspensable parLy ls noL before Lhe courL (LhaL) Lhe acLlon should be
dlsmlssed (eople v 8odrlguez 106 hll 323 aL p 327) 1he absence of an lndlspensable parLy renders all subsequenL acLuaLlons of Lhe courL null and vold for wanL of auLhorlLy Lo acL noL only as Lo
Lhe absenL parLles buL even as Lo Lhose presenL ln shorL whaL respondenL courL dld here was exacLly Lhe reverse of whaL Lhe law ordalns lL ellmlnaLed Lhose who by law should preclsely be [olned
As may he noLed from Lhe order of respondenL courL quoLed earller whlch resolved Lhe moLlons for reconslderaLlon of Lhe dlsmlssal order flled by Lhe nondefaulLed defendanLs Pls Ponor
raLlonallzed hls poslLlon Lhus
lL ls Lhe rule LhaL lL ls Lhe absoluLe prerogaLlve of Lhe plalnLlff Lo choose Lhe Lheory upon whlch he predlcaLes hls rlghL of acLlon or Lhe parLles he deslres Lo sue wlLhouL
dlcLaLlon or lmposlLlon by Lhe courL or Lhe adverse parLy lf he makes a mlsLake ln Lhe cholce of hls rlghL of acLlon or ln LhaL of Lhe parLles agalnsL whom he seeks Lo enforce lL
LhaL ls hls own concern as he alone suffers Lherefrom 1he plalnLlff cannoL be compelled Lo choose hls defendanLs Pe may noL aL hls own expense be forced Lo lmplead
anyone who under Lhe adverse parLys Lheory ls Lo answer for defendanLs llablllLy nelLher may Lhe CourL compel hlm Lo furnlsh Lhe means by whlch defendanL may avold or
mlLlgaLe Lhelr llablllLy (vano vs Alo 93 hll 493496)
1hls belng Lhe rule Lhls courL cannoL compel Lhe plalnLlff Lo conLlnue prosecuLlng her cause of acLlon agalnsL Lhe defendanLsmovanLs lf ln Lhe course of Lhe Lrlal she belleves
she can enforce lL agalnsL Lhe remalnlng defendanLs sub[ecL only Lo Lhe llmlLaLlon provlded ln SecLlon 2 8ule 17 of Lhe 8ules of CourL (ages 6263 8ecord)
noLlceably Pls Ponor has employed Lhe same equlvocal Lermlnology as ln plalnLlffs moLlon of CcLober 18 1974 by referrlng Lo Lhe acLlon he had Laken as belng dlsmlssal of Lhe complalnL agalnsL
Lhem or Lhelr belng dropped Lherefrom wlLhouL percelvlng LhaL Lhe reason for Lhe evldenLly lnLenLlonal amblgulLy ls LransparenL 1he apparenL ldea ls Lo rely on Lhe Lheory LhaL under SecLlon 11 of
8ule 3 parLles may be dropped by Lhe courL upon moLlon of any parLy aL any sLage of Lhe acLlon hence lL ls Lhe absoluLe rlghL prerogaLlve of Lhe plalnLlff Lo chooseLhe parLles he deslres Lo sue
wlLhouL dlcLaLlon or lmposlLlon by Lhe courL or Lhe adverse parLy ln oLher words Lhe amblvalenL pose ls suggesLed LhaL plalnLlffs moLlon of CcLober 18 1974 was noL predlcaLed on SecLlon 2 of 8ule
17 buL more on SecLlon 11 of 8ule 3 8uL Lhe LruLh ls LhaL noLhlng can be more lncorrecL 1o sLarL wlLh Lhe laLLer rule does noL comprehend whlmslcal and lrraLlonal dropplng or addlng of parLles ln a
complalnL WhaL lL really conLemplaLes ls erroneous or mlsLaken non[olnder and mls[olnder of parLles no one ls free Lo [oln anybody ln a complalnL ln courL only Lo drop hlm unceremonlously laLer aL
Lhe pleasure of Lhe plalnLlff 1he rule presupposes LhaL Lhe orlglnal lncluslon had been made ln Lhe honesL convlcLlon LhaL lL was proper and Lhe subsequenL dropplng ls requesLed because lL has
Lurned ouL LhaL such lncluslon was a mlsLake And Lhls ls Lhe reason why Lhe rule ordalns LhaL Lhe dropplng be on such Lerms as are [usL [usL Lo all Lhe oLher parLles ln Lhe case aL bar Lhere ls
noLhlng ln Lhe record Lo legally [usLlfy Lhe dropplng of Lhe nondefaulLed defendanLs Llm and Leonardo 1he moLlon of CcLober 18 1974 clLes none lrom all appearances plalnLlff [usL declded Lo ask
for lL wlLhouL any relevanL explanaLlon aL all usually Lhe courL ln granLlng such a moLlon lnqulres for Lhe reasons and ln Lhe approprlaLe lnsLances dlrecLs Lhe granLlng of some form of compensaLlon
for Lhe Lrouble undergone by Lhe defendanL ln answerlng Lhe complalnL preparlng for or proceedlng parLlally Lo Lrlal hlrlng counsel and maklng correspondlng expenses ln Lhe premlses noLhlng of
Lhese appears ln Lhe order ln quesLlon MosL lmporLanLly Pls Ponor oughL Lo have consldered LhaL Lhe ouLrlghL dropplng of Lhe nondefaulLed defendanLs Llm and Leonardo over Lhelr ob[ecLlon aL
LhaL would cerLalnly be un[usL noL only Lo Lhe peLlLloners Lhelr own parenLs who would ln consequence be enLlrely defenseless buL also Lo Llm and Leonardo Lhemselves who would naLurally
correspondlngly suffer from Lhe evenLual [udgmenL agalnsL Lhelr parenLs 8espondenL courL pald no heed aL all Lo Lhe mandaLe LhaL such dropplng musL be on such Lerms as are [usL meanlng Lo all
concerned wlLh lLs legal and facLual effecLs
1hus lL ls qulLe plaln LhaL respondenL courL erred ln lssulng lLs order of dlsmlssal of CcLober 21 1974 as well as lLs order of uecember 6 1974 denylng reconslderaLlon of such dlsmlssal As We make
Lhls rullng We are noL obllvlous of Lhe clrcumsLance LhaL defendanLs Llm and Leonardo are noL parLles hereln 8uL such conslderaLlon ls lnconsequenLlal 1he faLe of Lhe case of peLlLloners ls
lnseparably Lled up wlLh sald order of dlsmlssal lf only because Lhe order of expotte hearlng of CcLober 21 1974 whlch dlrecLly affecLs and pre[udlces sald peLlLloners ls predlcaLed Lhereon
necessarlly Lherefore We have Lo pass on Lhe legallLy of sald order lf We are Lo declde Lhe case of hereln peLlLloners properly and falrly
1he aLLlLude of Lhe nondefaulLed defendanLs of no longer pursulng furLher Lhelr quesLlonlng of Lhe dlsmlssal ls from anoLher polnL of vlew undersLandable Cn Lhe one hand why should Lhey lnslsL on
belng defendanLs when plalnLlff herself has already release from her clalms? Cn Lhe oLher hand as far as Lhelr respecLlve parenLscodefendanLs are concerned Lhey musL have reallzed LhaL Lhey
(Lhelr parenLs) could even be beneflLed by such dlsmlssal because Lhey could quesLlon wheLher or noL plalnLlff can sLlll prosecuLe her case agalnsL Lhem afLer she had secured Lhe order of dlsmlssal ln
quesLlon And lL ls ln connecLlon wlLh Lhls lasL polnL LhaL Lhe Lrue and correcL concepL of defaulL becomes relevanL
AL Lhls [uncLure lL may also be sLaLed LhaL Lhe declslon of Lhe CourL of Appeals of !anuary 24 1973 ln C 8 no S03066 dlsmlsslng Lhe peLlLlon for cerLlorarl of nondefaulLed defendanLs Llm and
Leonardo lmpugnlng Lhe order of dlsmlssal of CcLober 21 1974 has no bearlng aL all ln Lhls case noL only because LhaL dlsmlssal was premlsed by Lhe appellaLe courL on lLs holdlng LhaL Lhe sald
peLlLlon was premaLure lnasmuch as Lhe Lrlal courL had noL yeL resolved Lhe moLlon of Lhe defendanLs of CcLober 28 1974 praylng LhaL sald dlspuLed order be quashed buL prlnclpally because hereln
peLlLloners were noL parLles ln LhaL proceedlng and cannoL Lherefore be bound by lLs resulL ln parLlcular We deem lL warranLed Lo draw Lhe aLLenLlon of prlvaLe respondenLs counsel Lo hls
allegaLlons ln paragraphs xl Lo xlv of hls answer whlch relaLe Lo sald declslon of Lhe CourL of Appeals and whlch have Lhe clear Lendency Lo make lL appear Lo Lhe CourL LhaL Lhe appeals courL had
upheld Lhe legallLy and valldlLy of Lhe acLuaLlons of Lhe Lrlal courL belng quesLloned when as a maLLer of lndlspuLable facL Lhe dlsmlssal of Lhe peLlLlon was based solely and excluslvely on lLs belng
premaLure wlLhouL ln any manner delvlng lnLo lLs merlLs 1he CourL musL and does admonlsh counsel LhaL such manner of pleadlng belng decepLlve and lacklng ln candor has no place ln any courL
much less ln Lhe Supreme CourL and lf We are adopLlng a passlve aLLlLude ln Lhe premlses lL ls due only Lo Lhe facL LhaL Lhls ls counsels flrsL offense 8uL slmllar conducL on hls parL ln Lhe fuLure wlll
deflnlLely be dealL wlLh more severely arLles and counsel would be well advlsed Lo avold such aLLempLs Lo befuddle Lhe lssues as lnvarlably Lhen wlll be exposed for whaL Lhey are cerLalnly uneLhlcal
and degradlng Lo Lhe dlgnlLy of Lhe law professlon Moreover almosL always Lhey only beLray Lhe lnherenL weakness of Lhe cause of Lhe parLy resorLlng Lo Lhem
2
Comlng now Lo Lhe maLLer lLself of defaulL lL ls qulLe apparenL LhaL Lhe lmpugned orders musL have proceeded from lnadequaLe apprehenslon of Lhe fundamenLal precepLs governlng such procedure
under Lhe 8ules of CourL lL ls Llme lndeed LhaL Lhe concepL of Lhls procedural devlce were fully undersLood by Lhe bench and bar lnsLead of belng merely Laken for granLed as belng LhaL of a slmple
expedlenL of noL allowlng Lhe offendlng parLy Lo Lake parL ln Lhe proceedlngs so LhaL afLer hls adversary shall have presenLed hls evldence [udgmenL may be rendered ln favor of such opponenL wlLh
hardly any chance of sald [udgmenL belng reversed or modlfled
1he 8ules of CourL conLaln a separaLe rule on Lhe sub[ecL of defaulL 8ule 18 8uL sald rule ls concerned solely wlLh defaulL resulLlng from fallure of Lhe defendanL or defendanLs Lo answer wlLhln Lhe
reglemenLary perlod 8eferrlng Lo Lhe slmplesL form of defaulL LhaL ls where Lhere ls only one defendanL ln Lhe acLlon and he falls Lo answer on Llme SecLlon 1 of Lhe rule provldes LhaL upon proof of
such fallure (Lhe courL shall) declare Lhe defendanL ln defaulL 1hereupon Lhe courL shall proceed Lo recelve Lhe plalnLlffs evldence and render [udgmenL granLlng hlm such rellef as Lhe complalnL and
Lhe facLs proven may warranL 1hls lasL clause ls clarlfled by SecLlon 3 whlch says LhaL a [udgmenL enLered agalnsL a parLy ln defaulL shall noL exceed Lhe amounL or be dlfferenL ln klnd from LhaL
prayed for
unequlvocal ln Lhe llLeral sense as Lhese provlslons are Lhey do noL readlly convey Lhe full lmporL of whaL Lhey conLemplaLe 1o begln wlLh conLrary Lo Lhe lmmedlaLe noLlon LhaL can be drawn from
Lhelr language Lhese provlslons are noL Lo be undersLood as meanlng LhaL defaulL or Lhe fallure of Lhe defendanL Lo answer should be lnLerpreLed as an admlsslon by Lhe sald defendanL LhaL Lhe
plalnLlffs cause of acLlon flnd supporL ln Lhe law or LhaL plalnLlff ls enLlLled Lo Lhe rellef prayed for (Moran supra p 333 clLlng Macondary Co v LusLaqulo 64 hll 466 clLlng wlLh approval Chaffln
v Mcladden 41 Ark 42 !ohnson v lerce 12 Ark 399 Mayden v !ohnson 39 Ca 103 eople v 8usL 292 111 328 ken v Leopold 21 111 A 163 Chlcago eLc LlecLrlc 8 Co v krempel 116 111 A
233)
age 7 of 13

8elng declared ln defaulL does noL consLlLuLe a walver of rlghLs excepL LhaL of belng heard and of presenLlng evldence ln Lhe Lrlal courL Accordlng Lo SecLlon 2 excepL as provlded ln SecLlon 9 of 8ule
13 a parLy declared ln defaulL shall noL be enLlLled Lo noLlce of subsequenL proceedlngs nor Lo Lake parL ln Lhe Lrlal 1haL provlslon referred Lo reads no servlce of papers oLher Lhan subsLanLlally
amended pleadlngs and flnal orders or [udgmenLs shall be necessary on a parLy ln defaulL unless he flles a moLlon Lo seL aslde Lhe order of defaulL ln whlch evenL he shall be enLlLled Lo noLlce of all
furLher proceedlngs regardless of wheLher Lhe order of defaulL ls seL aslde or noL And pursuanL Lo SecLlon 2 of 8ule 41 a parLy who has been declared ln defaulL may llkewlse appeal from Lhe
[udgmenL rendered agalnsL hlm as conLrary Lo Lhe evldence or Lo Lhe law even lf no peLlLlon for rellef Lo seL aslde Lhe order of defaulL has been presenLed by hlm ln accordance wlLh 8ule 38
ln oLher words a defaulLed defendanL ls noL acLually Lhrown ouL of courL Whlle ln a sense lL may be sald LhaL by defaulLlng he leaves hlmself aL Lhe mercy of Lhe courL Lhe rules see Lo lL LhaL any
[udgmenL agalnsL hlm musL be ln accordance wlLh law 1he evldence Lo supporL Lhe plalnLlffs cause ls of course presenLed ln hls absence buL Lhe courL ls noL supposed Lo admlL LhaL whlch ls baslcally
lncompeLenL AlLhough Lhe defendanL would noL be ln a poslLlon Lo ob[ecL elemenLary [usLlce requlres LhaL only legal evldence should be consldered agalnsL hlm lf Lhe evldence presenLed should noL
be sufflclenL Lo [usLlfy a [udgmenL for Lhe plalnLlff Lhe complalnL musL be dlsmlssed And lf an unfavorable [udgmenL should be [usLlflable lL cannoL exceed ln amounL or be dlfferenL ln klnd from whaL
ls prayed for ln Lhe complalnL
lncldenLally Lhese conslderaLlons argue agalnsL Lhe presenL wldespread pracLlce of Lrlal [udges as was done by Pls Ponor ln Lhls case of delegaLlng Lo Lhelr clerks of courL Lhe recepLlon of Lhe
plalnLlffs evldence when Lhe defendanL ls ln defaulL Such a racLlce ls wrong ln prlnclple and orlenLaLlon lL has no basls ln any rule When a defendanL allows hlmself Lo be declared ln defaulL he
relles on Lhe falLh LhaL Lhe courL would Lake care LhaL hls rlghLs are noL unduly pre[udlced Pe has a rlghL Lo presume LhaL Lhe law and Lhe rules wlll sLlll be observed 1he proceedlngs are held ln hls
forced absence and lL ls buL falr LhaL Lhe plalnLlff should noL be allowed Lo Lake advanLage of Lhe slLuaLlon Lo wln by foul or lllegal means or wlLh lnherenLly lncompeLenL evldence 1hus ln such
lnsLances Lhere ls need for more aLLenLlon from Lhe courL whlch only Lhe [udge hlmself can provlde 1he clerk of courL would noL be ln a poslLlon much less have Lhe auLhorlLy Lo acL ln Lhe premlses ln
Lhe manner demanded by Lhe rules of falr play and as conLemplaLed ln Lhe law conslderlng hls comparably llmlLed area of dlscreLlon and hls presumably lnferlor preparaLlon for Lhe funcLlons of a
[udge 8esldes Lhe defaulL of Lhe defendanL ls no excuse for Lhe courL Lo renounce Lhe opporLunlLy Lo closely observe Lhe demeanor and conducL of Lhe wlLnesses of Lhe plalnLlff Lhe beLLer Lo
appreclaLe Lhelr LruLhfulness and credlblllLy We Lherefore declare as a maLLer of [udlclal pollcy LhaL Lhere belng no lmperaLlve reason for [udges Lo do oLherwlse Lhe pracLlce should be dlsconLlnued
AnoLher maLLer of pracLlce worLhy of menLlon aL Lhls polnL ls LhaL lL ls preferable Lo leave enough opporLunlLy open for posslble llfLlng of Lhe order of defaulL before proceedlng wlLh Lhe recepLlon of
Lhe plalnLlffs evldence and Lhe rendlLlon of Lhe declslon A [udgmenL by defaulL may amounL Lo a poslLlve and conslderable ln[usLlce Lo Lhe defendanL and Lhe posslblllLy of such serlous
consequences necesslLaLes a careful and llberal examlnaLlon of Lhe grounds upon whlch Lhe defendanL may seek Lo seL lL aslde (Moran sopto p 334 clLlng Coombs vs SanLos 24 hll 446 449430)
1he expresslon Lherefore ln SecLlon 1 of 8ule 18 aforequoLed whlch says LhaL Lhereupon Lhe courL shall proceed Lo recelve Lhe plalnLlffs evldence eLc ls noL Lo be Laken llLerally 1he galn ln Llme
and dlspaLch should Lhe courL lmmedlaLely Lry Lhe case on Lhe very day of or shorLly afLer Lhe declaraLlon of defaulL ls far ouLwelghed by Lhe lnconvenlence and compllcaLlons lnvolved ln havlng Lo
undo everyLhlng already done ln Lhe evenL Lhe defendanL should [usLlfy hls omlsslon Lo answer on Llme
1he foregolng observaLlons as may be noLed refer Lo lnsLances where Lhe only defendanL or all Lhe defendanLs Lhere belng several are declared ln defaulL 1here are addlLlonal rules embodylng
more conslderaLlons of [usLlce and equlLy ln cases where Lhere are several defendanLs agalnsL whom a common cause of acLlon ls averred and noL all of Lhem answer opporLunely or are ln defaulL
parLlcularly ln reference Lo Lhe power of Lhe courL Lo render [udgmenL ln such slLuaLlons 1hus ln addlLlon Lo Lhe llmlLaLlon of SecLlon 3 LhaL Lhe [udgmenL by defaulL should noL be more ln amounL nor
dlfferenL ln klnd from Lhe rellefs speclflcally soughL by plalnLlff ln hls complalnL SecLlon 4 resLrlcLs Lhe auLhorlLy of Lhe courL ln renderlng [udgmenL ln Lhe slLuaLlons [usL menLloned as follows
Sec 4 IoJqmeot wbeo some JefeoJoots ooswet ooJ otbet moke Jlfflcolt wbeo o complolot stotes o commoo coose of octloo oqolost sevetol JefeoJoot some of wbom
ooswet ooJ tbe otbets foll to Jo so tbe coott sboll tty tbe cose oqolost oll opoo tbe ooswet tbos flleJ ooJ teoJet joJqmeot opoo tbe evlJeoce pteseoteJ 1be some ptoceeJloq
opplles wbeo o commoo coose of octloo ls pleoJeJ lo o coootetclolm ctossclolm ooJ tbltJpotty clolm
very apLly does Chlef !usLlce Moran elucldaLe on Lhls provlslon and Lhe conLrolllng [urlsprudence explanaLory Lhereof Lhls wlse
Where a complalnL sLaLes a common cause of acLlon agalnsL several defendanLs and some appear Lo defend Lhe case on Lhe merlLs whlle oLhers make defaulL Lhe defense
lnLerposed by Lhose who appear Lo llLlgaLe Lhe case lnures Lo Lhe beneflL of Lhose who fall Lo appear and lf Lhe courL flnds LhaL a good defense has been made all of Lhe
defendanLs musL be absolved ln oLher words Lhe answer flled by one or some of Lhe defendanLs lnures Lo Lhe beneflL of all Lhe oLhers even Lhose who have noL seasonably
flled Lhelr answer (8ueno v CrLlz L22978 !une 27 1968 23 SC8A 1131) 1he proper mode of proceedlng where a complalnL sLaLes a common cause of acLlon agalnsL several
defendanLs and one of Lhem makes defaulL ls slmply Lo enLer a formal defaulL order agalnsL hlm and proceed wlLh Lhe cause upon Lhe answers of Lhe oLhers 1he defaulLlng
defendanL merely loses hls sLandlng ln courL he noL belng enLlLled Lo Lhe servlce of noLlce ln Lhe cause nor Lo appear ln Lhe sulL ln any way Pe cannoL adduce evldence nor
can he be heard aL Lhe flnal hearlng (Llm 1oco v Co lay 80 hll 166) alLhough he may appeal Lhe [udgmenL rendered agalnsL hlm on Lhe merlLs (8ule 41 sec 2) lf Lhe case
ls flnally declded ln Lhe plalnLlffs favor a flnal decree ls Lhen enLered agalnsL all Lhe defendanLs buL lf Lhe sulL should be declded agalnsL Lhe plalnLlff Lhe acLlon wlll be
dlsmlssed as Lo all Lhe defendanLs allke (velez v 8amas 40 hll 787792 lrow v de la vega 13 Wal 33221 L Ld 60) ln oLher words Lhe [udgmenL wlll affecL Lhe defaulLlng
defendanLs elLher favorably or adversely (CasLro v ena 80 hll 488)
uefaulLlng defendanL may ask execuLlon lf [udgmenL ls ln hls favor (CasLro v ena sopto) (Moran 8ules of CourL vol 1 pp 338339)
ln costto vs leo 80 hll 488 one of Lhe numerous cases clLed by Moran Lhls CourL elaboraLed on Lhe consLrucLlon of Lhe same rule when lL sancLloned Lhe execuLlon upon
moLlon and for Lhe beneflL of Lhe defendanL ln defaulL of a [udgmenL whlch was adverse Lo Lhe plalnLlff 1he CourL held
As above sLaLed Lmllla MaLangulhan by her counsel also was a movanL ln Lhe peLlLlon for execuLlon Annex 1 uld she have a rlghL Lo be such havlng been declared ln
defaulL? ln ltow vs ue lo veqosopto clLed as auLhorlLy ln velez vs komos sopto Lhe Supreme CourL of Lhe unlLed SLaLes adopLed as ground for lLs own declslon Lhe
followlng rullng of Lhe new ?ork CourL of Lrrors ln closoo vs Mottls 10 !ons 324
lL would be unreasonable Lo hold LhaL because one defendanL had made defaulL Lhe plalnLlff should have a decree even agalnsL hlm where Lhe courL ls saLlsfled from Lhe
proofs offered by Lhe oLher LhaL ln facL Lhe plalnLlff ls noL enLlLled Lo a decree (21 Law ed 61)
1he reason ls slmple [usLlce has Lo be conslsLenL 1he complalnL sLaLlng a common cause of acLlon agalnsL several defendanLs Lhe complalnanLs rlghLs or lack of Lhem ln
Lhe conLroversy have Lo be Lhe same and noL dlfferenL as agalnsL all Lhe defendanLs alLhough one or some make defaulL and Lhe oLher or oLhers appear [oln lssue and enLer
lnLo Lrlal lor lnsLance ln Lhe case of closoo vs Mottls above clLed Lhe new ?ork CourL of Lrrors ln effecL held LhaL ln such a case lf Lhe plalnLlff ls noL enLlLled Lo a decree he
wlll noL be enLlLled Lo lL noL only as agalnsL Lhe defendanL appearlng and reslsLlng hls acLlon buL also as agalnsL Lhe one who made defaulL ln Lhe case aL bar Lhe cause of
acLlon ln Lhe plalnLlffs complalnL was common agalnsL Lhe Mayor of Manlla Lmllla MaLangulhan and Lhe oLher defendanLs ln Clvll Case no 1318 of Lhe lower courL 1he
CourL of llrsL lnsLance ln lLs [udgmenL found and held upon Lhe evldence adduced by Lhe plalnLlff and Lhe defendanL mayor LhaL as beLween sald plalnLlff and defendanL
MaLangulhan Lhe laLLer was Lhe one legally enLlLled Lo occupy Lhe sLalls and lL decreed among oLher Lhlngs LhaL sald plalnLlff lmmedlaLely vacaLe Lhem araphraslng Lhe
new ?ork CourL of Lrrors lL would be unreasonable Lo hold now LhaL because MaLangulhan had made defaulL Lhe sald plalnLlff should be declared as agalnsL her legally
enLlLled Lo Lhe occupancy of Lhe sLalls or Lo remaln Lhereln alLhough Lhe CourL of llrsL lnsLance was so flrmly saLlsfled from Lhe proofs offered by Lhe oLher defendanL LhaL
Lhe same plalnLlff was noL enLlLled Lo such occupancy LhaL lL perempLorlly ordered her Lo vacaLe Lhe sLalls lf ln Lhe cases of closoo vs Mottls sopto ltow vs ue lo veqo
sopto and velez vs komos sopto Lhe decrees enLered lnured Lo Lhe beneflL of Lhe defaulLlng defendanLs Lhere ls no reason why LhaL enLered ln sald case no 1318 should
noL be held also Lo have lnured Lo Lhe beneflL of Lhe defaulLlng defendanL MaLangulhan and Lhe docLrlne ln sald Lhree cases plalnly lmplles LhaL Lhere ls noLhlng ln Lhe law
governlng defaulL whlch would prohlblL Lhe courL from renderlng [udgmenL favorable Lo Lhe defaulLlng defendanL ln such cases lf lL lnured Lo her beneflL lL sLands Lo reason
age 8 of 13

LhaL she had a rlghL Lo clalm LhaL beneflL for lL would noL be a beneflL lf Lhe supposed beneflclary were barred from clalmlng lL and lf Lhe beneflL necesslLaLed Lhe execuLlon
of Lhe decree she musL be possessed of Lhe rlghL Lo ask for Lhe execuLlon Lhereof as she dld when she by counsel parLlclpaLed ln Lhe peLlLlon for execuLlon Annex 1
SecLlon 7 of 8ule 33 would seem Lo afford a solld supporL Lo Lhe above conslderaLlons lL provldes LhaL when a complalnL sLaLes a common cause of acLlon agalnsL several
defendanLs some of whom answer and Lhe oLhers make defaulL Lhe courL shall Lry Lhe case agalnsL all upon Lhe answer Lhus flled and render [udgmenL upon Lhe evldence
presenLed by Lhe parLles ln courL lL ls obvlous LhaL under Lhls provlslon Lhe case ls Lrled [olnLly noL only agalnsL Lhe defendanLs answerlng buL also agalnsL Lhose defaulLlng
and Lhe Lrlal ls held upon Lhe answer flled by Lhe former and Lhe [udgmenL lf adverse wlll pre[udlce Lhe defaulLlng defendanLs no less Lhan Lhose who answer ln oLher
words Lhe defaulLlng defendanLs are held bound by Lhe answer flled by Lhelr codefendanLs and by Lhe [udgmenL whlch Lhe courL may render agalnsL all of Lhem 8y Lhe same
Loken and by all rules of equlLy and falr play lf Lhe [udgmenL should happen Lo be favorable LoLally or parLlally Lo Lhe answerlng defendanLs lL musL correspondlngly beneflL
Lhe defaulLlng ones for lL would noL be [usL Lo leL Lhe [udgmenL produce effecLs as Lo Lhe defaulLlng defendanLs only when adverse Lo Lhem and noL when favorable
ln oeoo vs Ottlz 23 SC8A 1131 Lhe CourL applled Lhe provlslon under dlscusslon ln Lhe followlng words
ln answer Lo Lhe charge LhaL respondenL !udge had commlLLed a grave abuse of dlscreLlon ln renderlng a defaulL [udgmenL agalnsL Lhe C respondenLs allege LhaL noL havlng
flled lLs answer wlLhln Lhe reglemenLary perlod Lhe C was ln defaulL so LhaL lL was proper for aLanao Lo forLhwlLh presenL hls evldence and for respondenL !udge Lo render
sald [udgmenL lL should be noLed however LhaL ln enLerlng Lhe area ln quesLlon and seeklng Lo prevenL aLanao from conLlnulng hls logglng operaLlons Lhereln Lhe C was
merely execuLlng an order of Lhe ulrecLor of loresLry and acLlng as hls agenL aLanaos cause of acLlon agalnsL Lhe oLher respondenLs ln Case no 190 namely Lhe ulrecLor of
loresLry Lhe ulsLrlcL loresLer of Agusan Lhe loresL Cfflcer of 8ayugan Agusan and Lhe SecreLary of AgrlculLure and naLural 8esources ursuanL Lo 8ule 18 SecLlon 4 of Lhe
8ules of CourL when a complalnL sLaLes a common cause of acLlon agalnsL several defendanLs some of whom answer and Lhe oLhers fall Lo do so Lhe courL shall Lry Lhe case
agalnsL all upon Lhe answer Lhus flled (by some) and render [udgmenL upon Lhe evldence presenLed ln oLher words Lhe answer flled by one or some of Lhe defendanLs lnures
Lo Lhe beneflL of all Lhe oLhers even Lhose who have noL seasonably flled Lhelr answer
lndeed slnce Lhe peLlLlon ln Case no 190 seLs forLh a common cause of acLlon agalnsL all of Lhe respondenLs Lhereln a declslon ln favor of one of Lhem would necessarlly
favor Lhe oLhers ln facL Lhe maln lssue ln sald case ls wheLher aLanao has a Llmber llcense Lo underLake logglng operaLlons ln Lhe dlspuLed area lL ls noL posslble Lo declde
such lssue ln Lhe negaLlve lnsofar as Lhe ulrecLor of loresLry and Lo seLLle lL oLherwlse as regards Lhe C whlch ls merely acLlng as agenL of Lhe ulrecLor of loresLry and ls
Lherefore hls alLer ego wlLh respecL Lo Lhe dlspuLed foresL area
SLaLed dlfferenLly ln all lnsLances where a common cause of acLlon ls alleged agalnsL several defendanLs some of whom answer and Lhe oLhers do noL Lhe laLLer or Lhose ln defaulL acqulre a vesLed
rlghL noL only Lo own Lhe defense lnLerposed ln Lhe answer of Lhelr co defendanL or codefendanLs noL ln defaulL buL also Lo expecL a resulL of Lhe llLlgaLlon LoLally common wlLh Lhem ln klnd and ln
amounL wheLher favorable or unfavorable 1he subsLanLlve unlLy of Lhe plalnLlffs cause agalnsL all Lhe defendanLs ls carrled Lhrough Lo lLs ad[ecLlve phase as lnelucLably demanded by Lhe homogenelLy
and lndlvlslblllLy of [usLlce lLself lndeed slnce Lhe slngleness of Lhe cause of acLlon also lnevlLably lmplles LhaL all Lhe defendanLs are lndlspensable parLles Lhe courLs power Lo acL ls lnLegral and
cannoL be spllL such LhaL lL cannoL relleve any of Lhem and aL Lhe same Llme render [udgmenL agalnsL Lhe resL Conslderlng Lhe Lenor of Lhe secLlon ln quesLlon lL ls Lo be assumed LhaL when any
defendanL allows hlmself Lo be declared ln defaulL knowlng LhaL hls defendanL has already answered he does so LrusLlng ln Lhe assurance lmpllclL ln Lhe rule LhaL hls defaulL ls ln essence a mere
formallLy LhaL deprlves hlm of no more Lhan Lhe rlghL Lo Lake parL ln Lhe Lrlal and LhaL Lhe courL would deem anyLhlng done by or for Lhe answerlng defendanL as done by or for hlm 1he presumpLlon
ls LhaL oLherwlse he would noL have seen Lo LhaL he would noL be ln defaulL Cf course he has Lo suffer Lhe consequences of whaLever Lhe answerlng defendanL may do or fall Lo do regardless of
posslble adverse consequences buL lf Lhe complalnL has Lo be dlsmlssed ln so far as Lhe answerlng defendanL ls concerned lL becomes hls lnallenable rlghL LhaL Lhe same be dlsmlssed also as Lo hlm lL
does noL maLLer LhaL Lhe dlsmlssal ls upon Lhe evldence presenLed by Lhe plalnLlff or upon Lhe laLLers mere deslsLance for ln boLh conLlngencles Lhe lack of sufflclenL legal basls musL be Lhe cause
1he lnLegrlLy of Lhe common cause of acLlon agalnsL all Lhe defendanLs and Lhe lndlspensablllLy of all of Lhem ln Lhe proceedlngs do noL permlL any posslblllLy of walver of Lhe plalnLlffs rlghL only as Lo
one or some of Lhem wlLhouL lncludlng all of Lhem and so as a rule wlLhdrawal musL be deemed Lo be a confesslon of weakness as Lo all 1hls ls noL only elemenLary [usLlce lL also precludes Lhe
concomlLanL hazard LhaL plalnLlff mlghL resorL Lo Lhe klnd of procedural sLraLegem pracLlced by prlvaLe respondenL hereln LhaL resulLed ln LoLally deprlvlng peLlLloners of every opporLunlLy Lo defend
Lhemselves agalnsL her clalms whlch afLer all as wlll be seen laLer ln Lhls oplnlon Lhe record does noL show Lo be lnvulnerable boLh ln Lhelr facLual and legal aspecLs Laklng lnLo conslderaLlon Lhe
Lenor of Lhe pleadlngs and Lhe probaLlve value of Lhe compeLenL evldence whlch were before Lhe Lrlal courL when lL rendered lLs assalled declslon where all Lhe defendanLs are lndlspensable parLles
for whlch reason Lhe absence of any of Lhem ln Lhe case would resulL ln Lhe courL loslng lLs compeLency Lo acL valldly any compromlse LhaL Lhe plalnLlff mlghL wlsh Lo make wlLh any of Lhem musL as a
maLLer of correcL procedure have Lo awalL unLll afLer Lhe rendlLlon of Lhe [udgmenL aL whlch sLage Lhe plalnLlff may Lhen LreaL Lhe maLLer of lLs execuLlon and Lhe saLlsfacLlon of hls clalm as varlably
as he mlghL please Accordlngly ln Lhe case now before us LogeLher wlLh Lhe dlsmlssal of Lhe complalnL agalnsL Lhe nondefaulLed defendanLs Lhe courL should have ordered also Lhe dlsmlssal Lhereof
as Lo peLlLloners
lndeed Lhere ls more reason Lo apply here Lhe prlnclple of unlLy and lndlvlslblllLy of Lhe acLlon [usL dlscussed because all Lhe defendanLs here have already [olned genulne lssues wlLh plalnLlff 1helr
defaulL was only aL Lhe preLrlal And as Lo such absence of peLlLloners aL Lhe preLrlal Lhe same could be aLLrlbuLed Lo Lhe facL LhaL Lhey mlghL noL have consldered lL necessary anymore Lo be presenL
slnce Lhelr respecLlve chlldren Llm and Leonardo wlLh whom Lhey have common defenses could Lake care of Lhelr defenses as well AnyLhlng LhaL mlghL have had Lo be done by Lhem aL such preLrlal
could have been done for Lhem by Lhelr chlldren aL leasL lnlLlally speclally because ln Lhe llghL of Lhe pleadlngs before Lhe courL Lhe prospecLs of a compromlse musL have appeared Lo be raLher
remoLe Such aLLlLude of peLlLloners ls nelLher uncommon nor LoLally un[usLlfled under Lhe clrcumsLances Lo declare Lhem lmmedlaLely and lrrevocably ln defaulL was noL an absoluLe necesslLy
racLlcal conslderaLlons and reasons of equlLy should have moved respondenL courL Lo be more undersLandlng ln deallng wlLh Lhe slLuaLlon AfLer all declarlng Lhem ln defaulL as respondenL courL dld
noL lmpalr Lhelr rlghL Lo a common faLe wlLh Lhelr chlldren
3
AnoLher lssue Lo be resolved ln Lhls case ls Lhe quesLlon of wheLher or noL hereln peLlLloners were enLlLled Lo noLlce of plalnLlffs moLlon Lo drop Lhelr codefendanLs Llm and Leonardo conslderlng
LhaL peLlLloners had been prevlously declared ln defaulL ln Lhls connecLlon Lhe declslve conslderaLlon ls LhaL accordlng Lo Lhe appllcable rule SecLlon 9 8ule 13 already quoLed above (1) even afLer a
defendanL has been declared ln defaulL provlded he flles a moLlon Lo seL aslde Lhe order of defaulL he shall be enLlLled Lo noLlce of all furLher proceedlngs regardless of wheLher Lhe order of
defaulL ls seL aslde or noL and (2) a parLy ln defaulL who has noL flled such a moLlon Lo seL aslde musL sLlll be served wlLh all subsLanLlally amended or supplemenLed pleadlngs ln Lhe lnsLanL case lL
cannoL be denled LhaL peLlLloners had all flled Lhelr moLlon for reconslderaLlon of Lhe order declarlng Lhem ln defaulL 8espondenLs own answer Lo Lhe peLlLlon Lhereln makes reference Lo Lhe order of
Aprll 3 1973 Annex 8 of sald answer whlch denled sald moLlon for reconslderaLlon Cn page 3 of peLlLloners memorandum hereln Lhls moLlon ls referred Lo as a moLlon Lo seL aslde Lhe order of
defaulL 8uL as We have noL been favored by Lhe parLles wlLh a copy of Lhe sald moLlon We do noL even know Lhe excuse glven for peLlLloners fallure Lo appear aL Lhe preLrlal and We cannoL
Lherefore deLermlne wheLher or noL Lhe moLlon complled wlLh Lhe requlremenLs of SecLlon 3 of 8ule 18 whlch We have held Lo be conLrolllng ln cases of defaulL for fallure Lo answer on Llme (1he
hlllpplne8rlLlsh Co lnc eLc eL al vs 1he Pon Walfrldo de los Angeles eLc eL al 63 SC8A 30)
We do noL however have here as earller noLed a case of defaulL for fallure Lo answer buL one for fallure Lo appear aL Lhe preLrlal We relLeraLe ln Lhe slLuaLlon now before us lssues have already
been [olned ln facL evldence had been parLlally offered already aL Lhe preLrlal and more of lL aL Lhe acLual Lrlal whlch had already begun wlLh Lhe flrsL wlLness of Lhe plalnLlff undergolng recross
examlnaLlon WlLh Lhese facLs ln mlnd and conslderlng LhaL lssues had already been [olned even as regards Lhe defaulLed defendanLs lL would be requlrlng Lhe obvlous Lo preLend LhaL Lhere was sLlll
need for an oaLh or a verlflcaLlon as Lo Lhe merlLs of Lhe defense of Lhe defaulLed defendanLs ln Lhelr moLlon Lo reconslder Lhelr defaulL lnasmuch as none of Lhe parLles had asked for a summary
[udgmenL Lhere can be no quesLlon LhaL Lhe lssues [olned were genulne and consequenLly Lhe reason for requlrlng such oaLh or verlflcaLlon no longer holds 8esldes lL may also be relLeraLed LhaL
belng Lhe parenLs of Lhe nondefaulLed defendanLs peLlLloners musL have assumed LhaL Lhelr presence was superfluous parLlcularly because Lhe cause of acLlon agalnsL Lhem as well as Lhelr own
defenses are common under Lhese clrcumsLances Lhe form of Lhe moLlon by whlch Lhe defaulL was soughL Lo be llfLed ls secondary and Lhe requlremenLs of SecLlon 3 of 8ule 18 need noL be sLrlcLly
complled wlLh unllke ln cases of defaulL for fallure Lo answer We can Lhus hold as We do hold for Lhe purposes of Lhe revlval of Lhelr rlghL Lo noLlce under SecLlon 9 of 8ule 13 LhaL peLlLloners moLlon
for reconslderaLlon was ln subsLance legally adequaLe regardless of wheLher or noL lL was under oaLh
age 9 of 13

ln any evenL Lhe dropplng of Lhe defendanLs Llm and Leonardo from plalnLlffs amended complalnL was vlrLually a second amendmenL of plalnLlffs complalnL And Lhere can be no doubL LhaL such
amendmenL was subsLanLlal for wlLh Lhe ellmlnaLlon Lhereby of Lwo defendanLs allegedly solldarlly llable wlLh Lhelr codefendanLs hereln peLlLloners lL had Lhe effecL of lncreaslng proporLlonally
whaL each of Lhe remalnlng defendanLs Lhe sald peLlLloners would have Lo answer for [olnLly and severally Accordlngly noLlce Lo peLlLloners of Lhe plalnLlffs moLlon of CcLober 18 1974 was legally
lndlspensable under Lhe rule abovequoLed ConsequenLly respondenL courL had no auLhorlLy Lo acL on Lhe moLlon Lo dlsmlss pursuanL Lo SecLlon 6 of 8ule 13 for accordlng Lo SenaLor lranclsco (L)
he 8ules of CourL clearly provlde LhaL no moLlon shall be acLed upon by Lhe CourL wlLhouL Lhe proof of servlce of noLlce Lhereof LogeLher wlLh a copy of Lhe moLlon and oLher papers accompanylng lL
Lo all parLles concerned aL leasL Lhree days before Lhe hearlng Lhereof sLaLlng Lhe Llme and place for Lhe hearlng of Lhe moLlon (8ule 26 secLlon 4 3 and 6 8ules of CourL (now Sec 13 new 8ules)
When Lhe moLlon does noL comply wlLh Lhls requlremenL lL ls noL a moLlon lL presenLs no quesLlon whlch Lhe courL could declde And Lhe CourL acqulres no [urlsdlcLlon Lo conslder lL (8oman CaLhollc
8lshop of Llpa vs MunlclpallLy of unlsan 44 hll 866 Manakll vs 8evllla 42 hll 81) (Laserna vs !avler eL al CAC8 no 7883 Aprll 22 1933 21 L! 36 clLlng 8oman CaLhollc 8lshop of Llpa vs
MunlclpallLy of unlsan 44 hll 866 Manakll vs 8evllla 42 hll 81) (lranclsco 1he 8evlsed 8ules of CourL ln Lhe hlllpplnes pp 861862) 1hus We see agaln from a dlfferenL angle why respondenL
courLs order of dlsmlssal of CcLober 21 1974 ls faLally lneffecLlve
4
1he foregolng conslderaLlons noLwlLhsLandlng lL ls respondenLs poslLlon LhaL cerLlorarl ls noL Lhe proper remedy of peLlLloners lL ls conLended LhaL lnasmuch as sald peLlLloners have ln facL made
Lhelr appeal already by flllng Lhe requlred noLlce of appeal and appeal bond and a moLlon for exLenslon Lo flle Lhelr record on appeal whlch moLlon was granLed by respondenL courL Lhelr only
recourse ls Lo prosecuLe LhaL appeal AddlLlonally lL ls also malnLalned LhaL slnce peLlLloners have expressly wlLhdrawn Lhelr moLlon Lo quash of !anuary 4 1973 lmpugnlng Lhe order of CcLober 28
1974 Lhey have losL Lhelr rlghL Lo assall by cerLlorarl Lhe acLuaLlons of respondenL courL now belng quesLloned respondenL courL noL havlng been glven Lhe opporLunlLy Lo correcL any posslble error lL
mlghL have commlLLed
We do noL agree As already shown ln Lhe foregolng dlscusslon Lhe proceedlngs ln Lhe courL below have gone so far ouL of hand LhaL prompL acLlon ls needed Lo resLore order ln Lhe enLangled
slLuaLlon creaLed by Lhe serles of plalnly lllegal orders lL had lssued 1he essenLlal purpose of cettlototl ls Lo keep Lhe proceedlngs ln lower [udlclal courLs and Lrlbunals wlLhln legal bounds so LhaL due
process and Lhe rule of law may prevall aL all Llmes and arblLrarlness whlmslcallLy and unfalrness whlch [usLlce abhors may lmmedlaLely be sLamped ouL before graver ln[ury [urldlcal and oLherwlse
ensues Whlle generally Lhese ob[ecLlves may well be aLLalned ln an ordlnary appeal lL ls undoubLedly Lhe beLLer rule Lo allow Lhe speclal remedy of cerLlorarl aL Lhe opLlon of Lhe parLy adversely
affecLed when Lhe lrregularlLy commlLLed by Lhe Lrlal courL ls so grave and so far reachlng ln lLs consequences LhaL Lhe long and cumbersome procedure of appeal wlll only furLher aggravaLe Lhe
slLuaLlon of Lhe aggrleved parLy because oLher unLoward acLuaLlons are llkely Lo maLerlallze as naLural consequences of Lhose already perpeLraLed lf Lhe law were oLherwlse cerLlorarl would have no
reason aL all for belng
no elaboraLe dlscusslon ls needed Lo show Lhe urgenL need for correcLlve measures ln Lhe case aL bar verlly Lhls ls one case LhaL calls for Lhe exerclse of Lhe Supreme CourLs lnherenL power of
supervlslon over all klnds of [udlclal acLlons of lower courLs rlvaLe respondenLs procedural Lechnlque deslgned Lo dlsable peLlLloners Lo defend Lhemselves agalnsL her clalm whlch appears on Lhe
face of Lhe record lLself Lo be aL leasL hlghly conLroverslal seems Lo have so fasclnaLed respondenL courL LhaL none would be surprlsed should her pendlng moLlon for lmmedlaLe execuLlon of Lhe
lmpugned [udgmenL recelve slmllar ready sancLlon as her prevlous moLlons whlch Lurned Lhe proceedlngs lnLo a oneslded affalr 1he sLakes here are hlgh noL only ls Lhe sub[ecL maLLer conslderably
subsLanLlal Lhere ls Lhe more lmporLanL aspecL LhaL noL only Lhe splrlL and lnLenL of Lhe rules buL even Lhe baslc rudlmenLs of falr play have been dlsregarded lor Lhe CourL Lo leave unresLralned Lhe
obvlous Lendency of Lhe proceedlngs below would be noLhlng shorL of wlLLlngly condonlng lnequlLy and ln[usLlce resulLlng from erroneous consLrucLlon and unwarranLed appllcaLlon of procedural
rules
3
1he sum and LoLal of all Lhe foregolng dlsqulslLlons ls LhaL Lhe declslon here ln quesLlon ls legally anomalous lL ls predlcaLed on Lwo faLal malacLuaLlons of respondenL courL namely (1) Lhe dlsmlssal of
Lhe complalnL agalnsL Lhe nondefaulLed defendanLs Llm and Leonardo and (2) Lhe expotte recepLlon of Lhe evldence of Lhe plalnLlff by Lhe clerk of courL Lhe subsequenL uslng of Lhe same as basls for
lLs [udgmenL and Lhe rendlLlon of such [udgmenL
lor aL leasL Lhree reasons whlch We have already fully dlscussed above Lhe order of dlsmlssal of CcLober 21 1974 ls unworLhy of Cur sancLlon (1) Lhere was no Llmely noLlce of Lhe moLlon Lherefor Lo
Lhe nondefaulLed defendanLs aslde from Lhere belng no noLlce aL all Lo hereln peLlLloners (2) Lhe common answer of Lhe defendanLs lncludlng Lhe nondefaulLed conLalned a compulsory
counLerclalm lncapable of belng deLermlned ln an lndependenL acLlon and (3) Lhe lmmedlaLe effecL of such dlsmlssal was Lhe removal of Lhe Lwo nondefaulLed defendanLs as parLles and lnasmuch as
Lhey are boLh lndlspensable parLles ln Lhe case Lhe courL consequenLly losL Lhe slne qua non of Lhe exerclse of [udlclal power per otloso vs lollstlco sopto 1hls ls noL Lo menLlon anymore Lhe
lrregular delegaLlon Lo Lhe clerk of courL of Lhe funcLlon of recelvlng plalnLlffs evldence And as regards Lhe exparLe recepLlon of plalnLlffs evldence and subsequenL rendlLlon of Lhe [udgmenL by
defaulL based Lhereon We have seen LhaL lL was vlolaLlve of Lhe rlghL of Lhe peLlLloners under Lhe appllcable rules and prlnclples on defaulL Lo a common and slngle faLe wlLh Lhelr nondefaulLed co
defendanLs And We are noL yeL referrlng as We shall do Lhls anon Lo Lhe numerous reverslble errors ln Lhe declslon lLself
lL ls Lo be noLed however LhaL Lhe abovelndlcaLed Lwo fundamenLal flaws ln respondenL courLs acLuaLlons do noL call for a common correcLlve remedy We cannoL slmply rule LhaL all Lhe lmpugned
proceedlngs are null and vold and should be seL aslde wlLhouL belng faced wlLh Lhe lnsurmounLable obsLacle LhaL by so dolng We would be revlewlng Lhe case as agalnsL Lhe Lwo nondefaulLed
defendanLs who are noL before us noL belng parLles hereLo upon Lhe oLher hand for us Lo hold LhaL Lhe order of dlsmlssal should be allowed Lo sLand as conLended by respondenLs Lhemselves who
lnslsL LhaL Lhe same ls already flnal noL only because Lhe perlod for lLs flnallLy has long passed buL also because allegedly albelL noL very accuraLely sald nondefaulLed defendanLs unsuccessfully Lrled
Lo have lL seL aslde by Lhe CourL of Appeals whose declslon on Lhelr peLlLlon ls also already flnal We would have Lo dlsregard whaLever evldence had been presenLed by Lhe plalnLlff agalnsL Lhem and
of course Lhe flndlngs of respondenL courL based Lhereon whlch as Lhe assalled declslon shows are adverse Lo Lhem ln oLher words whlchever of Lhe Lwo apparenL remedles Lhe CourL chooses lL
would necessarlly enLall some klnd of posslble [urldlcal lmperfecLlon Speaklng of Lhelr respecLlve pracLlcal or pragmaLlc effecLs Lo annul Lhe dlsmlssal would lnevlLably pre[udlce Lhe rlghLs of Lhe non
defaulLed defendanLs whom We have noL heard and who even respondenLs would noL wlsh Lo have anyLhlng anymore Lo do wlLh Lhe case Cn Lhe oLher hand Lo lnclude peLlLloners ln Lhe dlsmlssal
would naLurally seL aL naughL every efforL prlvaLe respondenL has made Lo esLabllsh or prove her case Lhru means sancLloned by respondenL courL ln shorL We are confronLed wlLh a legal para
dllemma 8uL one Lhlng ls cerLaln Lhls dlfflculL slLuaLlons has been broughL abouL by none oLher Lhan prlvaLe respondenL who has qulLe cynlcally resorLed Lo procedural maneuvers wlLhouL reallzlng
LhaL Lhe LechnlcallLles of Lhe ad[ecLlve law even when apparenLly accuraLe from Lhe llLeral polnL of vlew cannoL prevall over Lhe lmperaLlves of Lhe subsLanLlve law and of equlLy LhaL always underlle
Lhem and whlch have Lo be lnevlLably consldered ln Lhe consLrucLlon of Lhe perLlnenL procedural rules
All Lhlngs consldered afLer careful and maLure dellberaLlon Lhe CourL has arrlved aL Lhe concluslon LhaL as beLween Lhe Lwo posslble alLernaLlves [usL sLaLed lL would only be falr equlLable and proper
Lo uphold Lhe poslLlon of peLlLloners ln oLher words We rule LhaL Lhe order of dlsmlssal of CcLober 21 1974 ls ln law a dlsmlssal of Lhe whole case of Lhe plalnLlff lncludlng as Lo peLlLloners hereln
ConsequenLly all proceedlngs held by respondenL courL subsequenL LhereLo lncludlng and prlnclpally lLs declslon of uecember 20 1974 are lllegal and should be seL aslde
1hls concluslon ls fully [usLlfled by Lhe followlng conslderaLlons of equlLy
1 lL ls very clear Lo us LhaL Lhe procedural maneuver resorLed Lo by prlvaLe respondenL ln securlng Lhe declslon ln her favor was lllconcelved lL was characLerlzed by LhaL whlch every prlnclple of law
and equlLy dlsdalns Laklng unfalr advanLage of Lhe rules of procedure ln order Lo unduly deprlve Lhe oLher parLy of full opporLunlLy Lo defend hls cause 1he ldea of dropplng Lhe nondefaulLed
defendanLs wlLh Lhe end ln vlew of compleLely lncapaclLaLlng Lhelr codefendanLs from maklng any defense wlLhouL conslderlng LhaL all of Lhem are lndlspensable parLles Lo a common cause of acLlon
Lo whlch Lhey have counLered wlLh a common defense readlly connoLes an lnLenL Lo secure a oneslded declslon even lmproperly And when ln Lhls connecLlon Lhe obvlous weakness of plalnLlffs
evldence ls Laken lnLo accounL one easlly undersLands why such LacLlcs had Lo be avalled of We cannoL dlrecLly or lndlrecLly glve Cur assenL Lo Lhe commlsslon of unfalrness and lnequlLy ln Lhe
appllcaLlon of Lhe rules of procedure parLlcularly when Lhe proprleLy of rellance Lhereon ls noL beyond conLroversy
age 10 of 13

2 1he Lheorles of remedlal law pursued by prlvaLe respondenLs alLhough approved by Pls Ponor run counLer Lo such baslc prlnclples ln Lhe rules on defaulL and such elemenLary rules on dlsmlssal of
acLlons and noLlce of moLlons LhaL no Lrlal courL should be unaware of or should be mlsLaken ln applylng We are aL a loss as Lo why Pls Ponor falled Lo see Lhrough counsels lnequlLous sLraLegy when
Lhe provlslons (1) on Lhe Lhreeday rule on noLlce of moLlons SecLlon 4 of 8ule 13 (2) agalnsL dlsmlssal of acLlons on moLlon of plalnLlff when Lhere ls a compulsory counLerclalm SecLlon 2 8ule 17 (3)
agalnsL permlLLlng Lhe absence of lndlspensable parLles SecLlon 7 8ule 3 (4) on servlce of papers upon defendanLs ln defaulL when Lhere are subsLanLlal amendmenLs Lo pleadlngs SecLlon 9 8ule 13
and (3) on Lhe unlLy and lnLegrlLy of Lhe faLe of defendanLs ln defaulL wlLh Lhose noL ln defaulL where Lhe cause of acLlon agalnsL Lhem and Lhelr own defenses are common SecLlon 4 8ule 18 are so
plaln and Lhe [urlsprudence declaraLory of Lhelr lnLenL and proper consLrucLlon are so readlly comprehenslble LhaL any error as Lo Lhelr appllcaLlon would be unusual ln any compeLenL Lrlal courL
3 AfLer all all Lhe malacLuaLlons of respondenL courL are Lraceable Lo Lhe lnlLlaLlve of prlvaLe respondenL and/or her counsel She cannoL Lherefore complaln LhaL she ls belng made Lo un[usLlflably
suffer Lhe consequences of whaL We have found Lo be erroneous orders of respondenL courL lL ls only falr LhaL she should noL be allowed Lo beneflL from her own frusLraLed ob[ecLlve of securlng a
oneslded declslon
4 More lmporLanLly We do noL heslLaLe Lo hold LhaL on Lhe basls of lLs own reclLals Lhe declslon ln quesLlon cannoL sLand close scruLlny WhaL ls more Lhe very conslderaLlons conLalned Lhereln
reveal convlnclngly Lhe lnherenL weakness of Lhe cause of Lhe plalnLlff 1o be sure We have been glvlng serlous LhoughL Lo Lhe ldea of merely reLurnlng Lhls case for a resumpLlon of Lrlal by seLLlng
aslde Lhe order of dlsmlssal of CcLober 21 1974 wlLh all lLs aLLendanL dlfflculLles on accounL of lLs adverse effecLs on parLles who have noL been heard buL upon closer sLudy of Lhe pleadlngs and Lhe
declslon and oLher clrcumsLances exLanL ln Lhe record before us We are now persuaded LhaL such a course of acLlon would only lead Lo more legal compllcaLlons lncldenL Lo aLLempLs on Lhe parL of
Lhe parLles concerned Lo desperaLely squeeze Lhemselves ouL of a bad slLuaLlon Anyway We feel confldenL LhaL by and large Lhere ls enough basls here and now for us Lo rule ouL Lhe clalm of Lhe
plalnLlff
Lven a mere superflclal readlng of Lhe declslon would lmmedlaLely reveal LhaL lL ls llLLered on lLs face wlLh deflclencles and lmperfecLlons whlch would have had no reason for belng were Lhere less
hasLe and more clrcumspecLlon ln renderlng Lhe same 8ecklessness ln [umplng Lo unwarranLed concluslons boLh facLual and legal ls aL once evldenL ln lLs flndlngs relaLlve preclsely Lo Lhe maln bases
Lhemselves of Lhe rellefs granLed lL ls apparenL Lhereln LhaL no efforL has been made Lo avold glarlng lnconslsLencles Where references are made Lo codal provlslons and [urlsprudence lnaccuracy
and lnappllcablllLy are aL once manlfesL lL hardly commends lLself as a dellberaLe and consclenclous ad[udlcaLlon of a llLlgaLlon whlch conslderlng Lhe subsLanLlal value of Lhe sub[ecL maLLer lL lnvolves
and Lhe unprecedenLed procedure LhaL was followed by respondenLs counsel calls for greaLer aLLenLlon and sklll Lhan Lhe general run of cases would
lotet ollo Lhe followlng feaLures of Lhe declslon make lL hlghly lmprobable LhaL lf We Look anoLher course of acLlon prlvaLe respondenL would sLlll be able Lo make ouL any case agalnsL peLlLloners noL
Lo speak of Lhelr codefendanLs who have already been exoneraLed by respondenL herself Lhru her moLlon Lo dlsmlss
1 Accordlng Lo Pls Ponors own sLaLemenL of plalnLlffs case she ls Lhe wldow of Lhe laLe 1ee Poon o Chuan (o Chuan for shorL) who was Lhen one of Lhe parLners ln Lhe commerclal parLnershlp
Clory Commerclal Co wlLh defendanLs AnLonlo Llm 1anhu (Llm 1anhu for shorL) and Alfonso Leonardo ng Sua (ng Sua for shorL) as coparLners LhaL afLer Lhe deaLh of her husband on March 11
1966 she ls enLlLled Lo share noL only ln Lhe caplLal and proflLs of Lhe parLnershlp buL also ln Lhe oLher asseLs boLh real and personal acqulred by Lhe parLnershlp wlLh funds of Lhe laLLer durlng lLs
llfeLlme
8elaLedly ln Lhe laLLer parL of Lhe declslon Lhe flndlngs are Lo Lhe followlng effecL
1haL Lhe hereln plalnLlff 1an uL and her laLe husband o Chuan marrled aL Lhe hlllpplne lndependenL Church of Cebu ClLy on uecember 20 1949 LhaL o Chuan dled on
March 11 1966 LhaL Lhe plalnLlff and Lhe laLe o Chuan were chlldless buL Lhe former has a fosLer son AnLonlo nunez whom she has reared slnce hls blrLh wlLh whom she
llves up Lo Lhe presenL LhaL prlor Lo Lhe marrlage of Lhe plalnLlff Lo o Chuan Lhe laLLer was already managlng Lhe parLnershlp Clory Commerclal Co Lhen engaged ln a llLLle
buslness ln hardware aL Manallll SL Cebu ClLy LhaL prlor Lo and [usL afLer Lhe marrlage of Lhe plalnLlff Lo o Chuan she was engaged ln Lhe drugsLore buslness LhaL noL long
afLer her marrlage upon Lhe suggesLlon of o Chuan Lhe plalnLlff sold her drugsLore for 12300000 whlch amounL she gave Lo her husband ln Lhe presence of defendanL Llm
1anhu and was lnvesLed ln Lhe parLnershlp Clory Commerclal Co someLlme ln 1930 LhaL afLer Lhe lnvesLmenL of Lhe abovesLaLed amounL ln Lhe parLnershlp lLs buslness
flourlshed and lL embarked ln Lhe lmporL buslness and also engaged ln Lhe wholesale and reLall Lrade of cemenL and Cl sheeLs and under huge proflLs
xxx xxx xxx
1haL Lhe laLe o Chuan was Lhe one who acLlvely managed Lhe buslness of Lhe parLnershlp Clory Commerclal Co he was Lhe one who made Lhe flnal declslons and approved
Lhe appolnLmenLs of new personnel who were Laken ln by Lhe parLnershlp LhaL Lhe laLe o Chuan and defendanLs Llm 1anhu and ng Sua are broLhers Lhe laLLer Lwo (2) belng
Lhe elder broLhers of Lhe former LhaL defendanLs Llm 1anhu and ng Sua are boLh naLurallzed llllplno clLlzens whereas Lhe laLe o Chuan unLll Lhe Llme of hls deaLh was a
Chlnese clLlzen LhaL Lhe Lhree (3) broLhers were parLners ln Lhe Clory Commerclal Co buL o Chuan was pracLlcally Lhe owner of Lhe parLnershlp havlng Lhe conLrolllng
lnLeresL LhaL defendanLs Llm 1anhu and ng Sua were parLners ln name buL Lhey were mere employees of o Chuan (p 8991 8ecord)
Pow dld Pls Ponor arrlve aL Lhese concluslons? 1o sLarL wlLh lL ls noL clear ln Lhe declslon wheLher or noL ln maklng lLs flndlngs of facL Lhe courL Look lnLo accounL Lhe allegaLlons ln Lhe pleadlngs of Lhe
parLles and whaLever mlghL have Lransplred aL Lhe preLrlal All LhaL We can gaLher ln Lhls respecL ls LhaL references are made Lhereln Lo preLrlal exhlblLs and Lo Annex A of Lhe answer of Lhe
defendanLs Lo plalnLlffs amended complalnL lndeed lL was lncumbenL upon Lhe courL Lo conslder noL only Lhe evldence formally offered aL Lhe Lrlal buL also Lhe admlsslons expressed or lmplled ln
Lhe pleadlngs as well as whaLever mlghL have been placed before lL or broughL Lo lLs aLLenLlon durlng Lhe preLrlal ln Lhls connecLlon lL ls Lo be regreLLed LhaL none of Lhe parLles has LhoughL lL proper
Lo glve us an ldea of whaL Look place aL Lhe preLrlal of Lhe presenL case and whaL are conLalned ln Lhe preLrlal order lf any was lssued pursuanL Lo SecLlon 4 of 8ule 20
1he fundamenLal purpose of preLrlal aslde from affordlng Lhe parLles every opporLunlLy Lo compromlse or seLLle Lhelr dlfferences ls for Lhe courL Lo be apprlsed of Lhe unseLLled lssues beLween Lhe
parLles and of Lhelr respecLlve evldence relaLlve LhereLo Lo Lhe end LhaL lL may Lake correspondlng measures LhaL would abbrevlaLe Lhe Lrlal as much as posslble and Lhe [udge may be able Lo ascerLaln
Lhe facLs wlLh Lhe leasL observance of Lechnlcal rules ln oLher words whaLever ls sald or done by Lhe parLles or Lhelr counsel aL Lhe pre Lrlal serves Lo puL Lhe [udge on noLlce of Lhelr respecLlve baslc
poslLlons ln order LhaL ln approprlaLe cases he may lf necessary ln Lhe lnLeresL of [usLlce and a more accuraLe deLermlnaLlon of Lhe facLs make lnqulrles abouL or requlre clarlflcaLlons of maLLers Laken
up aL Lhe preLrlal before flnally resolvlng any lssue of facL or of law ln brlef Lhe preLrlal consLlLuLes parL and parcel of Lhe proceedlngs and hence maLLers dealL wlLh Lhereln may noL be dlsregarded
ln Lhe process of declslon maklng CLherwlse Lhe real essence of compulsory preLrlal would be lnslgnlflcanL and worLhless
now applylng Lhese posLulaLes Lo Lhe flndlngs of respondenL courL [usL quoLed lL wlll be observed LhaL Lhe courLs concluslon abouL Lhe supposed marrlage of plalnLlff Lo Lhe deceased 1ee Poon Llm
o Chuan ls conLrary Lo Lhe welghL of Lhe evldence broughL before lL durlng Lhe Lrlal and Lhe preLrlal
under ArLlcle 33 of Lhe Clvll Code Lhe declaraLlon of Lhe conLracLlng parLles LhaL Lhey Lake each oLher as husband and wlfe shall be seL forLh ln an lnsLrumenL slgned by Lhe parLles as well as by Lhelr
wlLnesses and Lhe person solemnlzlng Lhe marrlage Accordlngly Lhe prlmary evldence of a marrlage musL be an auLhenLlc copy of Lhe marrlage conLracL Whlle a marrlage may also be proved by oLher
compeLenL evldence Lhe absence of Lhe conLracL musL flrsL be saLlsfacLorlly explalned Surely Lhe cerLlflcaLlon of Lhe person who allegedly solemnlzed a marrlage ls noL admlsslble evldence of such
marrlage unless proof of loss of Lhe conLracL or of any oLher saLlsfacLory reason for lLs nonproducLlon ls flrsL presenLed Lo Lhe courL ln Lhe case aL bar Lhe purporLed cerLlflcaLlon lssued by a Mons
!ose M 8ecoleLo 8lshop hlllpplne lndependenL Church Cebu ClLy ls noL Lherefore compeLenL evldence Lhere belng absoluLely no showlng as Lo unavallablllLy of Lhe marrlage conLracL and lndeed
as Lo Lhe auLhenLlclLy of Lhe slgnaLure of sald cerLlfler Lhe [uraL allegedly slgned by a second asslsLanL provlnclal flscal noL belng auLhorlzed by law slnce lL ls noL parL of Lhe funcLlons of hls offlce
8esldes lnasmuch as Lhe blshop dld noL LesLlfy Lhe same ls hearsay
age 11 of 13

As regards Lhe LesLlmony of plalnLlff herself on Lhe same polnL and LhaL of her wlLness AnLonlo nunez Lhere can be no quesLlon LhaL Lhey are boLh selfservlng and of very llLLle evldenLlary value lL
havlng been dlsclosed aL Lhe Lrlal LhaL plalnLlff has already asslgned all her rlghLs ln Lhls case Lo sald nunez Lhereby maklng hlm Lhe real parLy ln lnLeresL here and Lherefore naLurally as blased as
herself 8esldes ln Lhe porLlon of Lhe LesLlmony of nunez copled ln Annex C of peLlLloners memorandum lL appears admlLLed LhaL he was born only on March 23 1942 whlch means LhaL he was less
Lhan elghL years old aL Lhe supposed Llme of Lhe alleged marrlage lf for Lhls reason alone lL ls exLremely doubLful lf he could have been sufflclenLly aware of such evenL as Lo be compeLenL Lo LesLlfy
abouL lL
lncldenLally anoLher Annex C of Lhe same memorandum purporLs Lo be Lhe cerLlflcaLe of blrLh of one AnLonlo 1 uy supposed Lo have been born on March 23 1937 aL CenLro Mlsamls Mlsamls
CccldenLal Lhe son of one uy 8len faLher and 1an uL moLher SlgnlflcanLly respondenLs have noL made any adverse commenL on Lhls documenL lL ls more llkely Lherefore LhaL Lhe wlLness ls really
Lhe son of plalnLlff by her husband uy klm 8eng 8uL she LesLlfled she was chlldless So whlch ls whlch? ln any evenL lf on Lhe sLrengLh of Lhls documenL nunez ls acLually Lhe leglLlmaLe son of 1an uL
and noL her adopLed son he would have been buL 13 years old ln 1949 Lhe year of her alleged marrlage Lo o Chuan and even Lhen conslderlng such age hls LesLlmony ln regard LhereLo would sLlll
be suspecL
now as agalnsL such fllmsy evldence of plalnLlff Lhe courL had before lL Lwo documenLs of greaL welghL belylng Lhe preLended marrlage We refer Lo (1) LxhlblL LL Lhe lncome Lax reLurn of Lhe
deceased 1ee Poon Llm o Chuan lndlcaLlng LhaL Lhe name of hls wlfe was Ang Slck 1ln and (2) Lhe qulLclalm Annex A of Lhe answer whereln plalnLlff 1an uL sLaLed LhaL she had been llvlng wlLh Lhe
deceased wlLhouL beneflL of marrlage and LhaL she was hls commonlaw wlfe Surely Lhese Lwo documenLs are far more rellable Lhan all Lhe evldence of Lhe plalnLlff puL LogeLher
Cf course LxhlblL LL ls whaL mlghL be Lermed as preLrlal evldence 8uL lL ls evldence offered Lo Lhe [udge hlmself noL Lo Lhe clerk of courL and should have aL leasL moved hlm Lo ask plalnLlff Lo
explaln lf noL rebuL lL before [umplng Lo Lhe concluslon regardlng her alleged marrlage Lo Lhe deceased o Chuan And ln regard Lo Lhe qulLclalm conLalnlng Lhe admlsslon of a commonlaw
relaLlonshlp only lL ls Lo be observed LhaL Pls Ponor found LhaL defendanLs Llm 1anhu and ng Sua had Lhe plalnLlff execuLe a qulLclalm on november 29 1967 (Annex A Answer) where Lhey gave
plalnLlff Lhe amounL of 23000 as her share ln Lhe caplLal and proflLs of Lhe buslness of Clory Commerclal Co whlch was engaged ln Lhe hardware buslness wlLhouL maklng menLlon of any evldence
of fraud and mlsrepresenLaLlon ln lLs execuLlon Lhereby lndlcaLlng elLher LhaL no evldence Lo prove LhaL allegaLlon of Lhe plalnLlff had been presenLed by her or LhaL whaLever evldence was acLually
offered dld noL produce persuaslon upon Lhe courL SLaLed dlfferenLly slnce Lhe exlsLence of Lhe qulLclalm has been duly esLabllshed wlLhouL any clrcumsLance Lo deLracL from lLs legal lmporL Lhe
courL should have held LhaL plalnLlff was bound by her admlsslon Lhereln LhaL she was Lhe commonlaw wlfe only of o Chuan and whaL ls more LhaL she had already renounced for valuable
conslderaLlon whaLever clalm she mlghL have relaLlve Lo Lhe parLnershlp Clory Commerclal Co
And when lL ls borne ln mlnd LhaL ln addlLlon Lo all Lhese conslderaLlons Lhere are menLloned and dlscussed ln Lhe memorandum of peLlLloners (1) Lhe cerLlflcaLlon of Lhe Local Clvll 8eglsLrar of Cebu
ClLy and (2) a slmllar cerLlflcaLlon of Lhe AposLollc refecL of Lhe hlllpplne lndependenL Church arlsh of SLo nlno Cebu ClLy LhaL Lhelr respecLlve offlclal records correspondlng Lo uecember 1949 Lo
uecember 1930 do noL show any marrlage beLween 1ee Poon Llm o Chuan and 1an uL nelLher of whlch cerLlflcaLlons have been lmpugned by respondenL unLll now lL sLands Lo reason LhaL
plalnLlffs clalm of marrlage ls really unfounded WlLhal Lhere ls sLlll anoLher documenL also menLloned and dlscussed ln Lhe same memorandum and unlmpugned by respondenLs a wrlLLen
agreemenL execuLed ln Chlnese buL purporLedly LranslaLed lnLo Lngllsh by Lhe Chlnese Consul of Cebu beLween 1an uL and 1ee Poon Llm o Chuan Lo Lhe followlng effecL
CCnSuLA1L Cl 1PL 8Lu8LlC Cl CPlnA Cebu ClLy hlllpplnes
1 8 A n S L A 1 l C n
1hls ls Lo cerLlfy LhaL 1 Mlss 1an kl Lng Allas 1an uL have llved wlLh Mr Llm o Chuan allas 1eePoon slnce 1949 buL lL recenLly occurs LhaL we are lncompaLlble wlLh each
oLher and are noL ln Lhe poslLlon Lo keep llvlng LogeLher permanenLly WlLh Lhe muLual concurrence we declded Lo LermlnaLe Lhe exlsLlng relaLlonshlp of common law
marrlage and promlsed noL Lo lnLerfere each oLhers affalrs from now on 1he lorLy 1housand esos (4000000) has been glven Lo me by Mr Llm o Chuan for my
subslsLence
WlLnesses
Mr Llm 8eng Cuan Mr Puang Slng Se
Slgned on Lhe 10 day of Lhe 7Lh monLh of Lhe 34Lh year of Lhe 8epubllc of Chlna (correspondlng Lo Lhe year 1963)
(SCu) 1An kl LnC
verlfled from Lhe records !C8CL 1A8A8 (p 283284 8ecord)
lndeed noL only does Lhls documenL prove LhaL plalnLlffs relaLlon Lo Lhe deceased was LhaL of a commonlaw wlfe buL LhaL Lhey had seLLled Lhelr properLy lnLeresLs wlLh Lhe paymenL Lo her of
40000
ln Lhe llghL of all Lhese clrcumsLances We flnd no alLernaLlve buL Lo hold LhaL plalnLlff 1an uLs allegaLlon LhaL she ls Lhe wldow of 1ee Poon Llm o Chuan has noL been saLlsfacLorlly esLabllshed and
LhaL on Lhe conLrary Lhe evldence on record convlnclngly shows LhaL her relaLlon wlLh sald deceased was LhaL of a commonlaw wlfe and furLhermore LhaL all her clalms agalnsL Lhe company and lLs
survlvlng parLners as well as Lhose agalnsL Lhe esLaLe of Lhe deceased have already been seLLled and pald We Lake [udlclal noLlce of Lhe facL LhaL Lhe respecLlve counsel who asslsLed Lhe parLles ln Lhe
qulLclalm ALLys P Permoslslma and naLallo CasLlllo are members ln good sLandlng of Lhe hlllpplne 8ar wlLh Lhe parLlcularlLy LhaL Lhe laLLer has been a member of Lhe CablneL and of Lhe Pouse of
8epresenLaLlves of Lhe hlllpplnes hence absenL any credlble proof LhaL Lhey had allowed Lhemselves Lo be parLles Lo a fraudulenL documenL Pls Ponor dld rlghL ln recognlzlng lLs exlsLence albelL
errlng ln noL glvlng due legal slgnlflcance Lo lLs conLenLs
2 lf as We have seen plalnLlffs evldence of her alleged sLaLus as leglLlmaLe wlfe of o Chuan ls noL only unconvlnclng buL has been acLually overcome by Lhe more compeLenL and welghLy evldence ln
favor of Lhe defendanLs her aLLempL Lo subsLanLlaLe her maln cause of acLlon LhaL defendanLs Llm 1anhu and ng Sua have defrauded Lhe parLnershlp Clory Commerclal Co and converLed lLs
properLles Lo Lhemselves ls even more dlsmal lrom Lhe very evldence summarlzed by Pls Ponor ln Lhe declslon ln quesLlon lL ls clear LhaL noL an loLa of rellable proof exlsLs of such alleged mlsdeeds
Cf course Lhe exlsLence of Lhe parLnershlp has noL been denled lL ls acLually admlLLed lmplledly ln defendanLs afflrmaLlve defense LhaL o Chuans share had already been duly seLLled wlLh and pald
Lo boLh Lhe plalnLlff and hls leglLlmaLe famlly 8uL Lhe evldence as Lo Lhe acLual parLlclpaLlon of Lhe defendanLs Llm 1anhu and ng Sua ln Lhe operaLlon of Lhe buslness LhaL could have enabled Lhem Lo
make Lhe exLracLlons of funds alleged by plalnLlff ls aL besL confuslng and aL cerLaln polnLs manlfesLly lnconslsLenL
ln her amended complalnL plalnLlff repeaLedly alleged LhaL as wldow of o Chuan she ls enLlLled Lo '/
3
share of Lhe asseLs and properLles of Lhe parLnershlp ln facL her prayer ln sald complalnL ls
among oLhers for Lhe dellvery Lo her of such '/
3
share Pls Ponors sLaLemenL of Lhe case as well as hls flndlngs and [udgmenL are all Lo LhaL same effecL 8uL whaL dld she acLually Lry Lo prove aL
Lhe ex potte hearlng?
age 12 of 13

Accordlng Lo Lhe declslon plalnLlff had shown LhaL she had money of her own when she marrled o Chuan and LhaL prlor Lo and [usL afLer Lhe marrlage of Lhe plalnLlff Lo o Chuan she was engaged
ln Lhe drugsLore buslness LhaL noL long afLer her marrlage upon Lhe suggesLlon of o Chuan Lhe plalnLlff sold her drugsLore for 123000 whlch amounL she gave Lo her husband ln Lhe presence of
1anhu and was lnvesLed ln Lhe parLnershlp Clory Commerclal Co someLlme ln 1930 LhaL afLer Lhe lnvesLmenL of Lhe abovesLaLed amounL ln Lhe parLnershlp lLs buslness flourlshed and lL embarked ln
Lhe lmporL buslness and also engaged ln Lhe wholesale and reLall Lrade of cemenL and Cl sheeLs and under (slc) huge proflLs (pp 2326 Annex L peLlLlon)
1o begln wlLh Lhls Lheory of her havlng conLrlbuLed of 123000 Lo Lhe caplLal of Lhe parLnershlp by reason of whlch Lhe buslness flourlshed and amassed all Lhe mllllons referred Lo ln Lhe declslon has
noL been alleged ln Lhe complalnL and lnasmuch as whaL was belng rendered was a [udgmenL by defaulL such Lheory should noL have been allowed Lo be Lhe sub[ecL of any evldence 8uL lnasmuch as
lL was Lhe clerk of courL who recelved Lhe evldence lL ls undersLandable LhaL he falled Lo observe Lhe rule 1hen on Lhe oLher hand lf lL was her caplLal LhaL made Lhe parLnershlp flourlsh why would
she clalm Lo be enLlLled Lo only Lo '/
3
of lLs asseLs and proflLs? under her Lheory found proven by respondenL courL she was acLually Lhe owner of everyLhlng parLlcularly because Pls Ponor also found
LhaL defendanLs Llm 1anhu and ng Sua were parLners ln Lhe name buL Lhey were employees of o Chuan LhaL defendanLs Llm 1anhu and ng Sua had no means of llvellhood aL Lhe Llme of Lhelr
employmenL wlLh Lhe Clory Commerclal Co under Lhe managemenL of Lhe laLe o Chuan excepL Lhelr salarles Lherefrom (p 27lJ) Why Lhen does she clalm only '/
3
share? ls Lhls an lndlcaLlon of
her generoslLy Lowards defendanLs or of a concocLed cause of acLlon exlsLlng only ln her confused lmaglnaLlon engendered by Lhe deaLh of her commonlaw husband wlLh whom she had seLLled her
commonlaw clalm for recompense of her servlces as common law wlfe for less Lhan whaL she musL have known would go Lo hls leglLlmaLe wlfe and chlldren?
AcLually as may be noLed from Lhe declslon lLself Lhe Lrlal courL was confused as Lo Lhe parLlclpaLlon of defendanLs Llm 1anhu and ng Sua ln Clory Commerclal Co AL one polnL Lhey were deemed
parLners aL anoLher polnL mere employees and Lhen elsewhere as parLnersemployees a newly found concepL Lo be sure ln Lhe law on parLnershlp And Lhe confuslon ls worse comfounded ln Lhe
[udgmenL whlch allows Lhese parLners ln name and parLnersemployees or employees who had no means of llvellhood and who musL noL have conLrlbuLed any caplLal ln Lhe buslness as o
Chuan was pracLlcally Lhe owner of Lhe parLnershlp havlng Lhe conLrolllng lnLeresL '/
3
each of Lhe huge asseLs and proflLs of Lhe parLnershlp lncldenLally lL may be observed aL Lhls [uncLure LhaL Lhe
declslon has made o Chuan play Lhe lnconslsLenL role of belng pracLlcally Lhe owner buL aL Lhe same Llme geLLlng hls caplLal from Lhe 123000 glven Lo hlm by plalnLlff and from whlch caplLal Lhe
buslness allegedly flourlshed
AnenL Lhe allegaLlon of plalnLlff LhaL Lhe properLles shown by her exhlblLs Lo be ln Lhe names of defendanLs Llm 1anhu and ng Sua were boughL by Lhem wlLh parLnershlp funds Pls Ponor conflrmed
Lhe same by flndlng and holdlng LhaL lL ls llkewlse clear LhaL real properLles LogeLher wlLh Lhe lmprovemenLs ln Lhe names of defendanLs Llm 1anhu and ng Sua were acqulred wlLh parLnershlp funds
as Lhese defendanLs were only parLnersemployees of deceased o Chuan ln Lhe Clory Commerclal Co unLll Lhe Llme of hls deaLh on March 11 1966 (p 30 lJ) lL ls Cur consldered vlew however
LhaL Lhls concluslon of Pls Ponor ls based on noLhlng buL pure unwarranLed con[ecLure nowhere ls lL shown ln Lhe declslon how sald defendanLs could have exLracLed money from Lhe parLnershlp ln
Lhe fraudulenL and lllegal manner preLended by plalnLlff nelLher ln Lhe LesLlmony of nunez nor ln LhaL of plalnLlff as Lhese are summarlzed ln Lhe declslon can Lhere be found any slngle acL of
exLracLlon of parLnershlp funds commlLLed by any of sald defendanLs 1haL Lhe parLnershlp mlghL have grown lnLo a mulLlmllllon enLerprlse and LhaL Lhe properLles descrlbed ln Lhe exhlblLs
enumeraLed ln Lhe declslon are noL ln Lhe names of o Chuan who was Chlnese buL of Lhe defendanLs who are llllplnos do noL necessarlly prove LhaL o Chuan had noL goLLen hls share of Lhe proflLs
of Lhe buslness or LhaL Lhe properLles ln Lhe names of Lhe defendanLs were boughL wlLh money of Lhe parLnershlp ln Lhls connecLlon lL ls declslvely lmporLanL Lo conslder LhaL on Lhe basls of Lhe
concordanL and muLually cumulaLlve LesLlmonles of plalnLlff and nunez respondenL courL found very expllclLly LhaL and We relLeraLe
xxx xxx xxx
1haL Lhe laLe o Chuan was Lhe one who acLlvely managed Lhe buslness of Lhe parLnershlp Clory Commerclal Co he was Lhe one who made Lhe flnal declslons and approved
Lhe appolnLmenLs of new ersonnel who were Laken ln by Lhe parLnershlp LhaL Lhe laLe o Chuan and defendanLs Llm 1anhu and ng Sua are broLhers Lhe laLLer Lo (2) belng
Lhe elder broLhers of Lhe former LhaL defendanLs Llm 1anhu and ng Sua are boLh naLurallzed llllplno clLlzens whereas Lhe laLe o Chuan unLll Lhe Llme of hls deaLh was a
Chlnese clLlzen LhaL Lhe Lhree (3) broLhers were parLners ln Lhe Clory Commerclal Co buL o Chuan was pracLlcally Lhe owner of Lhe parLnershlp havlng Lhe conLrolllng
lnLeresL LhaL defendanLs Llm 1anhu and ng Sua were parLners ln name buL Lhey were mere employees of o Chuan (p 9091 8ecord)
lf o Chuan was ln conLrol of Lhe affalrs and Lhe runnlng of Lhe parLnershlp how could Lhe defendanLs have defrauded hlm of such huge amounLs as plalnLlff had made hls Ponor belleve? upon Lhe
oLher hand slnce o Chuan was ln conLrol of Lhe affalrs of Lhe parLnershlp Lhe more loglcal lnference ls LhaL lf defendanLs had obLalned any porLlon of Lhe funds of Lhe parLnershlp for Lhemselves lL
musL have been wlLh Lhe knowledge and consenL of o Chuan for whlch reason no accounLlng could be demanded from Lhem Lherefor conslderlng LhaL ArLlcle 1807 of Lhe Clvll Code refers only Lo
whaL ls Laken by a parLner wlLhouL Lhe consenL of Lhe oLher parLner or parLners lncldenLally agaln Lhls Lheory abouL o Chuan havlng been acLlvely managlng Lhe parLnershlp up Lo hls deaLh ls a
subsLanLlal devlaLlon from Lhe allegaLlon ln Lhe amended complalnL Lo Lhe effecL LhaL defendanLs AnLonlo Llm 1anhu Alfonso Leonardo ng Sua Llm 1eck Chuan and Lng Chong Leonardo Lhrough
fraud and machlnaLlon Look acLual and acLlve managemenL of Lhe parLnershlp and alLhough 1ee Poon Llm o Chuan was Lhe manager of Clory Commerclal Co defendanLs managed Lo use Lhe funds
of Lhe parLnershlp Lo purchase lands and bulldlngs eLc (ar 4 p 2 of amended complalnL Annex 8 of peLlLlon) and should noL have been permlLLed Lo be proven by Lhe hearlng offlcer who naLurally
dld noL know any beLLer
Moreover lL ls very slgnlflcanL LhaL accordlng Lo Lhe very Lax declaraLlons and land LlLles llsLed ln Lhe declslon mosL lf noL all of Lhe properLles supposed Lo have been acqulred by Lhe defendanLs Llm
1anhu and ng Sua wlLh funds of Lhe parLnershlp appear Lo have been Lransferred Lo Lhelr names only ln 1969 or laLer LhaL ls long afLer Lhe parLnershlp had been auLomaLlcally dlssolved as a resulL of
Lhe deaLh of o Chuan Accordlngly defendanLs have no obllgaLlon Lo accounL Lo anyone for such acqulslLlons ln Lhe absence of clear proof LhaL Lhey had vlolaLed Lhe LrusL of o Chuan durlng Lhe
exlsLence of Lhe parLnershlp (See Panlon vs Pansserman and 8eam 40 hll 796)
1here are oLher parLlculars whlch should have caused Pls Ponor Lo readlly dlsbelleve plalnLlffs preLenslons nunez LesLlfled LhaL for abouL 18 years he was ln charge of Lhe Cl sheeLs and someLlmes
aLLended Lo Lhe lmporLed lLems of Lhe buslness of Clory Commerclal Co CounLlng 18 years back from 1963 or 1966 would Lake us Lo 1947 or 1948 Slnce accordlng Lo LxhlblL LL Lhe bapLlsmal
cerLlflcaLe produced by Lhe same wlLness as hls blrLh cerLlflcaLe shows he was born ln March 1942 how could he have sLarLed managlng Clory Commerclal Co ln 1949 when he musL have been
barely slx or seven years old? lL should noL have escaped Pls Ponors aLLenLlon LhaL Lhe phoLographs showlng Lhe premlses of hlllpplne MeLal lndusLrles afLer lLs organlzaLlon a year or Lwo afLer Lhe
esLabllshmenL of Cebu Can lacLory ln 1937 or 1938 musL have been Laken afLer 1939 Pow could nunez have been only 13 years old Lhen as clalmed by hlm Lo have been hls age ln Lhose phoLographs
when accordlng Lo hls blrLh cerLlflcaLe he was born ln 1942? Pls Ponor should noL have overlooked LhaL accordlng Lo Lhe same wlLness defendanL ng Sua was llvlng ln 8anLayan unLll he was
dlrecLed Lo reLurn Lo Cebu afLer Lhe flshlng buslness LhereaL floundered whereas all LhaL Lhe wlLness knew abouL defendanL Llm 1eck Chuans arrlval from Pongkong and Lhe expendlLure of
parLnershlp money for hlm were only Lold Lo hlm allegedly by o Chuan whlch LesLlmonles are verlLably exculpaLory as Lo ng Sua and hearsay as Lo Llm 1eck Chuan nelLher should Pls Ponor have
falled Lo noLe LhaL accordlng Lo plalnLlff herself Llm 1anhu was employed by her husband alLhough he dld noL go Lhere always belng a mere employee of Clory Commerclal Co (p 22 Annex Lhe
declslon)
1he declslon ls raLher emphaLlc ln LhaL Llm 1anhu and ng Sua had no known lncome excepL Lhelr salarles AcLually lL ls noL sLaLed however from whaL evldence such concluslon was derlved ln so far
as ng Sua ls concerned Cn Lhe oLher hand wlLh respecL Lo Llm 1anhu Lhe declslon lLself sLaLes LhaL accordlng Lo LxhlblL nnre Lrlal ln Lhe supposed lncome Lax reLurn of Llm 1anhu for 1964 he had
an lncome of 4800 as salary from hlllpplne MeLal lndusLrles alone and had a LoLal assess sable neL lncome of 2392077 LhaL year for whlch he pald a Lax of 463600 (p 14 Annex L lJ) And per
LxhlblL CCreLrlal ln Lhe year he had a neL lncome of 32000 for whlch be pald a Lax of 331240 (lJ) As early as 1962 hls flshlng buslness ln Madrlde[os Cebu was maklng money and he reporLed
a neL galn from operaLlon (ln) Lhe amounL of 86364 (lJ per LxhlblL vvreLrlal) lrom whaL Lhen dld hls Ponor gaLher Lhe concluslon LhaL all Lhe properLles reglsLered ln hls name have come from
funds malversed from Lhe parLnershlp?
lL ls raLher unusual LhaL Pls Ponor delved lnLo flnanclal sLaLemenLs and books of Clory Commerclal Co wlLhouL Lhe ald of any accounLanL or wlLhouL Lhe same belng explalned by any wlLness who had
prepared Lhem or who has knowledge of Lhe enLrles Lhereln 1hls musL be Lhe reason why Lhere are apparenL lnconslsLencles and lnaccuracles ln Lhe concluslons Pls Ponor made ouL of Lhem ln
LxhlblL SSreLrlal Lhe reporLed LoLal asseLs of Lhe company amounLed Lo 232846027 as of uecember 1963 and yeL LxhlblL 11reLrlal accordlng Lo Pls Ponor showed LhaL Lhe LoLal value of
goods avallable as of Lhe same daLe was 1116632762 Cn Lhe oLher hand per LxhlblL xxreLrlal Lhe supposed balance sheeL of Lhe company for 1966 Lhe value of lnvenLorled merchandlse boLh
local and lmporLed as found by Pls Ponor was 38403438 Agaln as of uecember 31 1966 Lhe value of Lhe companys goods avallable for sale was 332403087 per LxhlblL ?? and ??reLrlal
age 13 of 13

1hen per LxhlblL ll3reLrlal Lhe supposed 8ook of AccounL whaLever LhaL ls of Lhe company showed lLs cash analysls was 1222318233 We do noL heslLaLe Lo make Lhe observaLlon LhaL Pls
Ponor unless he ls a cerLlfled publlc accounLanL was hardly quallfled Lo read such exhlblLs and draw any deflnlLe concluslons Lherefrom wlLhouL rlsk of errlng and commlLLlng an ln[usLlce ln any
evenL Lhere ls no comprehenslble explanaLlon ln Lhe declslon of Lhe concluslon of Pls Ponor LhaL Lhere were 1222318233 cash money defendanLs have Lo accounL for parLlcularly when lL can be
very clearly seen ln LxhlblLs 114 114 A 113 and 116reLrlal Clory Commerclal Co had accounLs payable as of uecember 31 1963 ln Lhe amounL of 480132117 (p 13 lJ) under Lhe
clrcumsLances We are noL prepared Lo permlL anyone Lo predlcaLe any clalm or rlghL from respondenL courLs unalded exerclse of accounLlng knowledge
AddlLlonally We noLe LhaL Lhe declslon has noL made any flndlng regardlng Lhe allegaLlon ln Lhe amended complalnL LhaL a corporaLlon denomlnaLed Clory Commerclal Co lnc was organlzed afLer
Lhe deaLh of o Chuan wlLh caplLal from Lhe funds of Lhe parLnershlp We noLe also LhaL Lhere ls absoluLely no flndlng made as Lo how Lhe defendanLs uy Cchay and Co Cyo could ln any way be
accounLable Lo plalnLlff [usL because Lhey happen Lo be Lhe wlves of Llm 1anhu and ng Sua respecLlvely We furLher noLe LhaL whlle Pls Ponor has ordered defendanLs Lo dellver or pay [olnLly and
severally Lo Lhe plalnLlff 407439418 or '/
3
of Lhe 1222318233 Lhe supposed cash belonglng Lo Lhe parLnershlp as of uecember 31 1963 ln Lhe same breaLh Lhey have also been senLenced Lo
parLlLlon and glve '/
3
share of Lhe properLles enumeraLed ln Lhe dlsposlLlve porLlon of Lhe declslon whlch seemlngly are Lhe very properLles allegedly purchased from Lhe funds of Lhe parLnershlp
whlch would naLurally lnclude Lhe 1222318233 defendanLs have Lo accounL for 8esldes assumlng Lhere has noL yeL been any llquldaLlon of Lhe parLnershlp conLrary Lo Lhe allegaLlon of Lhe
defendanLs Lhen Clory Commerclal Co would have Lhe sLaLus of a parLnershlp ln llquldaLlon and Lhe only rlghL plalnLlff could have would be Lo whaL mlghL resulL afLer such llquldaLlon Lo belong Lo Lhe
deceased parLner and before Lhls ls flnlshed lL ls lmposslble Lo deLermlne whaL rlghLs or lnLeresLs lf any Lhe deceased had (8earneza vs uequllla 43 hll 237) ln oLher words no speclflc amounLs or
properLles may be ad[udlcaLed Lo Lhe helr or legal represenLaLlve of Lhe deceased parLner wlLhouL Lhe llquldaLlon belng flrsL LermlnaLed
lndeed only Llme and Lhe fear LhaL Lhls declslon would be much more exLended Lhan lL ls already prevenL us from furLher polnLlng ouL Lhe lnexpllcable deflclencles and lmperfecLlons of Lhe declslon ln
quesLlon AfLer all whaL have been dlscussed should be more Lhan sufflclenL Lo supporL Cur concluslon LhaL noL only musL sald declslon be seL aslde buL also LhaL Lhe acLlon of Lhe plalnLlff musL be
LoLally dlsmlssed and were lL noL seemlngly fuLlle and producLlve of oLher legal compllcaLlons LhaL plalnLlff ls llable on defendanLs counLerclalms 8esoluLlon of Lhe oLher lssues ralsed by Lhe parLles
albelL lmporLanL and perhaps plvoLal has llkewlse become superfluous
ln vlLW Cl ALL 1PL lC8LCClnC Lhe peLlLlon ls granLed All proceedlngs held ln respondenL courL ln lLs Clvll Case no 12328 subsequenL Lo Lhe order of dlsmlssal of CcLober 21 1974 are hereby
annulled and seL aslde parLlcularly Lhe expotte proceedlngs agalnsL peLlLloners and Lhe declslon on uecember 20 1974 8espondenL courL ls hereby ordered Lo enLer an order exLendlng Lhe effecLs of
lLs order of dlsmlssal of Lhe acLlon daLed CcLober 21 1974 Lo hereln peLlLloners AnLonlo Llm 1anhu uy Cchay Alfonso Leonardo ng Sua and Co Cyo And respondenL courL ls hereby permanenLly
en[olned from Laklng any furLher acLlon ln sald clvll case gave and excepL as hereln lndlcaLed CosLs agalnsL prlvaLe respondenL
Mokollotol cI letoooJo Apoloo ooJ coocepcloo It II coocot