CIVIL PROCEDURE RULE 7-9 FULL TEXT
G.R. No. L-28140 March 19, 1970
CAPITOL MOTORS CORPORATIONS, plaintiff-appellee,
vs.
NEMESIO I. YABUT, defendant-appellant.
VILLAMOR, J.:
Appeal on a question of law from the judgment of the Court of
First Instance of Rizal in its Civil Case. No. Q-9869.
On March 1, 1966, Capitol Motors Corporations filed a complaint
against Nemesio I. Yabut. It was therein averred that on April 24,
1965, the defendant executed in favor of the plaintiff a
promissory note (copy of which was attached to the complaint)
for the sum of P30,134.25, payable in eighteen (18) equal
monthly installments with interest at 12% per annum, the first
installment to become due on June 10, 1965, that it was
stipulated in the promissory note that should the defendant fail
to pay two (2) successive installments, the principal sum
remaining unpaid would immediately become due and
demandable and the defendant would, by way of attorney's fees
and costs of collection, be obligated to the plaintiff for an
additional sum equivalent to 25% of the principal and interest
due; that as of February 23, 1966, the sum remaining unpaid on
the promissory note was P30,754.79, including accrued interest;
that the defendant defaulted in the payment of two (2)
successive installments, and likewise failed to pay the interest
due on the promissory note; and that in spite of demands by the
plaintiff, the defendant failed and refused to pay the said
principal sum and interest due. Prayer was made that the
defendant be ordered to pay the plaintiff the sum of P30,754.79,
as well as the interest due thereon from February 23, 1966, and
an additional sum equivalent to 25% of the amount due, plus
costs.
On April 27, 1966, and within the reglementary period, the
defendant, through his counsel, filed an answer which reads:
DEFENDANT through counsel alleges:
1. Paragraph 1 of the complaint is admitted.
2. Paragraphs 2, 3, 4, 5, 6 and 7 of the complaint are
specifically denied for lack of knowledge sufficient to
form a belief as to the truth thereof.
WHEREFORE, it is respectfully prayed that the
Complaint be dismissed with costs against the plaintiff.
On June 16, 1966, the plaintiff filed a motion for judgment on the
pleadings, on the ground that the defendant, not having set forth
in his answer the substance of the matters relied upon by him to
support his denial, had failed to deny specifically the material
allegations of the complaint, hence, must be deemed to have
admitted them. The defendant did not file an opposition to the
motion. On September 13, 1966, after hearing on the motion,
the court issued an order granting the said motion and
considering the case submitted for decision on the basis of the
pleadings; and on January 9, 1967, the court rendered judgment
granting in toto the plaintiff's prayer in its complaint.
In this appeal, defendant-appellant contends that the court a
quo erred in considering him as having failed to deny specifically
the material allegations of the complaint, and, consequently, in
deciding the case on the basis of the pleadings. Citing Moran,
Comments on the Rules of Court, Vol. I, 1963 Ed., p. 281, he
argues that since Section 10, Rule 8 of the Revised Rules of
Court, recognizes three (3) modes of specific denial, namely: (1)
by specifying each material allegation of fact in the complaint
the truth of which the defendant does not admit, and, whenever
practicable, setting forth the substance of the matters which he
will rely upon to support his denial or (2) by specifying so much
of an averment in the complaint as is true and material and
denying only the remainder or (3) by stating that the defendant
is without knowledge or information sufficient to form a belief as
to the truth of a material averment in the complaint, which has
the effect of a denial, and he has adopted the third mode of
specific denial, his answer tendered an issue, and, consequently
the court a quo could not render a valid judgment on the
pleadings.
This appeal is without merit.
We agree with defendant-appellant that one of the modes of
specific denial contemplated in Section 10, Rule 8, is a denial by
stating that the defendant is without knowledge or information
sufficient to form a belief as to the truth of a material averment in
the complaint. The question, however, is whether paragraph 2 of
defendant-appellant's answer constitutes a specific denial under
the said rule. We do not think so. In Warner Barnes & Co., Ltd.
vs. Reyes, et al., G.R. No. L-9531, May 14, 1958 (103 Phil.,
662), this Court said that the rule authorizing an answer to the
effect that the defendant has no knowledge or information
sufficient to form a belief as to the truth of an averment and
giving such answer the effect of a denial, does not apply where
the fact as to which want of knowledge is asserted, is so plainly
and necessarily within the defendant's knowledge that his
averment of ignorance must be palpably untrue. In said case the
suit was one for foreclosure of mortgage, and a copy of the
deed of mortgage was attached to the complaint; thus,
according to this Court, it would have been easy for the
defendants to specifically allege in their answer whether or not
they had executed the alleged mortgage. The same thing can be
said in the present case, where a copy of the promissory note
sued upon was attached to the complaint. The doctrine in
Warner Barnes & Co., Ltd. was reiterated in J. P. Juan & Sons,
Inc. vs. Lianga Industries, Inc., G.R. No. L-25137, July 28, 1969
(28 SCRA 807). And in Sy-quia vs. Marsman, G.R. No. L-23426,
March 1, 1968 (22 SCRA 927), this Court said:
With regard to the plea of lack of knowledge or
information set up in paragraph 3 of the answer, this
Court's decision in Warner Barnes vs. Reyes, 103
Phil. 662, 665, is authority for the proposition that
this form of denial must be availed of with sincerity
and good faith, not for the purpose of confusing the
other party, nor for purposes of delay. Yet, so lacking
in sincerity and good faith is this part of the answer
that defendants-appellants go to the limit of denying
knowledge or information as to whether they
(defendants) were in the premises (Marsman Bldg.)
on January 4, 1961, as averred in paragraph 4 of
the complaint. Yet whether such a fact was or was
not true could not be unknown to these defendants.
In National Marketing Corporation vs. De Castro, 106 Phil. 803
(1959), this Court held:
Furthermore, in his answer to the appellee's
complaint, he merely alleged that 'he has no
knowledge or information sufficient to form a belief as
to the truth of the matters contained in paragraphs 3,
4, 5 and 6 so much so that he denies specifically said
allegations.' A denial is not specific simply because it
is so qualified. (Sections 6 and 7, Rule 9; El Hogar
Filipino vs. Santos Investments, Inc., 74 Phil. 79;
Baetamo vs. Amador, 74 Phil. 735; Dacanay vs.
Lucero, 76 Phil. 139; Lagrimas vs. Lagrimas, 95 Phil.
113). Material averments in a complaint, other than
those as to the amount of damage, are deemed
admitted when not specifically denied. (Section 8,
Rule 9,) The court may render judgment upon the
pleadings if material averments in the complaint are
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
admitted. (Section 10, Rule 35; Baetamo vs.
Amador, supra, Lichauco vs. Guash, 76 Phil. 5; Lati
vs. Valmores, G.R. No. L-6877, 30 March 1954.)

It becomes evident from all the above doctrines that a mere

allegation of ignorance of the facts alleged in the complaint, is
insufficient to raise an issue; the defendant must aver positively
or state how it is that he is ignorant of the facts so alleged.
(Francisco, The Revised Rules of Court in the Philippines, Vol. I,
p. 417, citing Wood vs. Staniels, 3 Code Rep. 152 and Vassalt
vs. Austin, 32 Cal. 597.)

Thus, in at least two (2) cases where this Court ruled that
judgment on the pleadings was not proper, it will be seen that
the reason was that in each case the defendants did something
more than merely alleging lack of knowledge or information
sufficient to form a belief. In Arrojo vs. Caldoza, et al., G.R. No.
L-17454, July 31, 1963 (8 SCRA 547), the defendants, in their
answer to the complaint for recovery of possession of a parcel
of land, did not merely allege that they had no knowledge or
information sufficient to form a belief as to the truth of the
material allegations in the complaint, but added the following:
"The truth of the matter is that the defendants have not occupied
or taken any property belonging to the plaintiff. They took
possession and ownership only of the land belonging to them,
which properties were possessed and owned originally by their
predecessors-in-interest, who were the parents of the
defendants ...." In Benavides vs. Alabastro, G.R. No. L-19762,
December 23, 1964 (12 SCRA 553), the defendant's answer did
not only deny the material allegations of the complaints but also
set up certain special and affirmative defenses the nature of
which called for presentation of evidence.

There are two other reasons why the present appeal must fail.
First. The present action is founded upon a written instrument
attached to the complaint, but defendant-appellant failed to deny
under oath the genuineness and due execution of the
instrument; hence, the same are deemed admitted. (Section 8,
Rule 8 of the Revised Rules of Court; Songo vs. Sellner, 37 Phil.
254; Philippine Commercial & Industrial Bank vs. ELRO
Development Corporation, et al., G.R. No. L-30830, August 22,
1969 [29, SCRA 38]; J. P. Juan & Sons, Inc. vs. Lianga
Industries, Inc., supra.) Second. Defendant-appellant did not
oppose the motion for judgment on the pleadings filed by plaintiff
appellee; neither has he filed a motion for reconsideration of the
order of September 13, 1966, which deemed the case submitted
for decision on the pleadings, or of the decision rendered on
January 9, 1967. In Santiago vs. Basilan Lumber Company,
G.R. No. L-15532, October 31, 1963 (9 SCRA 349), this Court
said:

It appears that when the plaintiff moved to

have the case decided on the pleadings, the
defendant interposed no objection and has
practically assented thereto. The defendant,
therefore, is deemed to have admitted the
allegations of the complaint, so that there
was no necessity for the plaintiff to submit
evidence of his claim.

PREMISES CONSIDERED, the judgment appealed from is

affirmed, with cost against defendant-appellant.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
G.R. No. L-41767 August 23, 1978
MR. AND MRS. ROMEO FERRER and ANNETTE
FERRER, petitioners,
vs.
HON. VICENTE G. ERICTA, in his capacity as Presiding
Judge of the Court of First Instance of Rizal, Quezon City,
Branch XVIII, MR. AND MRS. FRANCIS PFLEIDER and
DENNIS PFLEIDER, respondents.
ANTONIO, J:
Mandamus to compel the immediate execution of the Decision
of the Court of First Instance of Quezon City, Branch XVIII,
presided over by respondent Judge, in Civil Case No. Q-19647,
dated July 21, 1975. The pertinent facts are as follows:
In a complaint for damages against respondents, dated
December 27, 1974 but actually filed on January 6, 1975 (Civil
Case No. Q-19647), and assigned to the sala of respondent
Judge, it was alleged that defendants Mr. and Mrs. Francis
Pfleider, residents of Bayawan, Negros Oriental, were the
owners or operators of a Ford pick-up car; that at about 5:00
o'clock in the afternoon of December 31, 1970, in the streets of
Bayawan, Negros Oriental, their son, defendant Dennis Pfleider,
who was then only sixteen (16) years of age, without proper
official authority, drove the above-described vehicle, without due
regard to traffic rules and regulations, and without taking the
necessary precaution to prevent injury to persons or damage to
property, and as a consequence the pickup car was overturned,
causing physical injuries to plaintiff Annette Ferrer, who was
then a passenger therein, which injuries paralyzed her and
required medical treatment and confinement at different
hospitals for more than two (2) years; that as a result of the
physical injuries sustained by Annette, she suffered
unimaginable physical pain, mental anguish, and her parents
also suffered mental anguish, moral shock and spent a
considerable sum of money for her treatment. They prayed that
defendants be ordered to reimburse them for actual expenses
as well as other damages.
In due time, defendants filed their answer, putting up the
affirmative defense that defendant Dennis Pfleider exercised
due care and utmost diligence in driving the vehicle
aforementioned and alleging that Annette Ferrer and the other
persons aboard said vehicle were not passengers in the strict
sense of the term, but were merely joy riders and that,
consequently, defendants had no obligation whatsoever to
plaintiffs.
At the pre-trial on May 12, 1975, only plaintiffs-petitioners and
their counsel were present. Consequently, defendants-private
respondents were declared in default and the plaintiff petitioners
were allowed to present their evidence ex parte. On May 21,
1975, petitioners moved that they be granted an extension of
ten (10) days from May 22, 1975 to present her evidence, which
was granted by the court a quo. The presentation of petitioners'
evidence was later continued by the trial court to June 16, 1975,
when the deposition of Annette Ferrer was submitted by
petitioners and admitted by the trial court.
On June 26, 1975, private respondents filed a motion to "set
aside the order of default and subsequent pleadings" on the
ground that "defendants' failure to appear for pre-trial was due
to accident or excusable neglect." This was opposed by
petitioners on the ground that the said pleading was not under
oath, contrary to the requirements of Sec. 3, Rule 18 of the
Rules, and that it was not accompanied by an affidavit of merit
showing that the defendants have a good defense. In view of
this, the motion of private respondents was denied by
respondent Judge on July 21, 1975. On the same date,
respondent Judge rendered judgment against private
respondents, finding that the minor Dennis Pfleider, was allowed
by his parents to operate a Ford pick-up car and because of his
reckless negligence caused the accident in question, resulting in
injuries to Annette, and ordering the defendants, as a result
thereof, to pay jointly and severally the plaintiffs the following
amounts: (1) P24,500.00 for actual expenses, hospitalization
and medical expenses; (2) P24,000.00 for actual expenses for
the care, medicines of plaintiff Annette for helps from December
31, 1970 to December 31, 1974; (3) P50,000.00 for moral
damages; (4) P10,000.00 for exemplary damages; (5)
P5,000.00 for attorney's fees; and (6) costs of suit.
On September 1, 1975, private respondents filed a Motion for
Reconsideration 1 of the decision and of the order denying the
motion to set aside order of default, based on the following
grounds: (1) the complaint states no cause of action insofar as
Mr. and Mrs. Pfleider are concerned because it does not allege
that at the time of the mishap, defendant Dennis Pfleider was
living with them, the fact being that at such time he was living
apart from them, hence, there can be no application of Article
2180 of the Civil Code, upon which parents' liability is premised;
and (2) that tile complaint shows on its face "that it was filed only
on January 6, 1975, or after the lapse of MORE THAN FOUR
YEARS from the date of the accident on December 31, 1970",
likewise appearing from the complaint and, therefore, the action
has already prescribed under Article 1146 of the Civil Code.
A Supplemental Motion for Reconsideration 2 was subsequently
filed by defendants-private respondents on September 10, 1975,
alleging that their defense of prescription has not been waived
and may be raised even at such stage of the proceedings
because on the face of the complaint, as well as from the
plaintiff's evidence, their cause of action had already prescribed,
citing as authority the decision of this Court in Philippine
National Bank v. Pacific Commission House, 3 as well as the
decisions quoted therein. The Opposition 4 to the above
supplemental motion interposed by plaintiffs-petitioners averred
that: (a) the defense of prescription had been waived while the
defense that the complaint states no cause of action "is
available only at any time not later than the trial and prior to the
decision"; (b) inasmuch as defendants have been declared in
default for failure to appear at the pretrial conference, they have
lost their standing in court and cannot be allowed to adduce
evidence nor to take part in the trial, in accordance with Section
2 of Rule 18 of the Rules of Court; and (c) the motion and
supplemental motion for reconsideration are pro formabecause
the defenses raised therein have been previously raised and
passed upon by respondent court in resolving defendants'
motion to set aside order of default. Being pro forma, said
motion and supplemental motion do not suspend the running of
the thirty-day period to appeal, which was from August 5, 1975,
when defendants received a copy of the decision, to September
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
4, 1975, and hence the decision has already become final and
executory. Plaintiffs-petitioners accordingly prayed that a writ of
execution be issued to enforce the judgment in their favor.
On September 23, 1975, respondent judge, without setting
aside the order of default, issued an order absolving defendants
from any liability on the grounds that: (a) the complaint states no
cause of action because it does not allege that Dennis Pfleider
was living with his parents at the time of the vehicular accident,
considering that under Article 2180 of the Civil Code, the father
and, in case of his death or incapacity the mother, are only
responsible for the damages caused by their minor children who
live in their company; and (b) that the defense of prescription is
meritorious, since the complaint was filed more than four (4)
years after the date of the accident, and the action to recover
damages based on quasi-delict prescribes in four (4) years.
Hence, the instant petition for mandamus.
In the present case, there is no issue of fact involved in
connection with the question of prescription. The complaint in
Civil Case No. Q-19647 alleges that the accident which caused
the injuries sustained by plaintiff Annette Ferrer occured on
December 31, 1970. It is undisputed that the action for damages
was only filed on January 6, 1975. Actions for damages arising
from physical injuries because of a tort must be filed within four
years. 8 The four-year period begins from the day the quasi-
delict is committed or the date of the accident. 9
WHEREFORE, the instant petition for mandamus is hereby
DISMISSED, without pronouncement as to costs.

The basic issue is whether the defense of prescription had been

deemed waived by private respondents' failure to allege the
same in their answer.

As early as Chua Lamko v. Dioso, et al., 5 this Court sustained

the dismissal of a counterclaim on the ground of prescription,
although such defense was not raised in the answer of the
plaintiff. Thus, this Court held that where the answer does not
take issue with the complaint as to dates involved in the
defendant's claim of prescription, his failure to specifically plead
prescription in the answer does not constitute a waiver of the
defense of prescription. It was explained that the defense of
prescription, even if not raised in a motion to dismiss or in the
answer, is not deemed waived unless such defense
raises issues of fact not appearing upon the preceding pleading.

In Philippine National Bank v. Perez, et al., 6 which was an action

filed by the Philippine National Bank on March 22, 1961 for
revival of a judgment rendered on December 29, 1949 against
Amando Perez, Gregorio Pumuntoc and Virginia de Pumuntoc
pursuant to Section 6, Rule 39 of the rules of court the
defendants were declared in default for their failure to file their
answer. There upon, the plaintiff submitted its evidence, but
when the case was submitted for decision, the court a
quo dismissed the complaint on the ground that plaintiff's cause
of action had already prescribed under Articles 1144 and 1152 of
the Civil Code. The plaintiff in said case, contending that since
prescription is a defense that can only be set up by defendants,
the court could not motu proprio consider it as a basis for
dismissal, moved to reconsider the order, but its motion was
denied. When the issue was raised to this Court, We ruled:

It is true that the defense of prescription can only be

considered if the same is invoked as such in the answer
of the defendant and that in this particular instance no
such defense was invoked because the defendants had
been declared in default, but such rule does riot obtain
when the evidence shows that the cause of action upon
which plaintiff's complaint is based is already barred by
the statute of limitations. (Emphasis supplied.)

Again, in Philippine National Bank v. Pacific Commission

House, 7 where the action sought to revive a judgment rendered
by the Court of First Instance of Manila on February 3, 1953 and
it was patent from the stamp appearing on the first page of the
complaint that the complaint was actually filed on May 31, 1963,
this Court sustained the dismissal of the complaint on the
ground of prescription, although such defense was not raised in
the answer, overruling the appellants' invocation of Section 2 of
Rule 9 of the Rules of Court that "defenses and objections not
pleaded either in a motion to dismiss or in tile answer are
deemed waived." We held therein that "... the fact that the
plaintiff's own allegation in tile complaint or the evidence it
presented shows clearly that the action had prescribed removes
this case from the rule regarding waiver of the defense by failure
to plead the same."
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
[G.R. No. L-9014. October 31, 1956.]
not sure kai 100 scra 251 ang gisuwat; 100phil 251 ni
SIMEONA BARCELONA, QUIRICO SAN GABRIEL, and
TEODORA SAN GABRIEL, Petitioners, vs. HILARION
BARCELONA and THE HONORABLE COURT OF
APPEALS, Respondents.
DECISION
MONTEMAYOR, J.:
This is a petition to review by way of certiorari, a decision of the
Court of Appeals affirming the judgment of the Court of First
Instance of Laguna in hectares each, covered by certificates of
title under the Torrens system. The facts as found by the Court
of Appeals are as follows:chanroblesvirtuallawlibrary
A certain Leoncia Barcelona was the lawful wife of one Canuto
Sanchez. The couple acquired out of their common funds two
parcels of land of about four hectares now dedicated to palay,
and located in the barrio of Puypuy Bay, Laguna, as well as
some jewels valued at P2,000. Leoncia died on March 25, 1933,
and on December 11, 1934, Hilarion Barcelona, a brother of the
deceased, for himself and behalf of Simeona Barcelona, Quirico
San Gabriel and Teodora San Gabriel instituted Special
Proceedings No. 6585 in the Court of First Instance of Laguna
for the issuance of letters of administration of the properties of
said decedent, the records of which were destroyed during the
last war. Consequently, the surviving spouse, Canuto Sanchez,
was appointed administrator of the estate. As he could not afford
to pay all the claims against the estate, Hilarion Barcelona, the
eldest brother of the deceased paid all the total indebtedness in
the sum of P1,070 (Exhibit (2, 2-A and 2-B). On October 29,
1940, Canuto Sanchez sold his share in the conjugal properties
to Hilarion Barcelona (Exhibit 2). Subsequently, in December
1940, Simeona Barcelona and Aniceto San Gabriel, who is row
deceased and the father Quirico San Gabriel and Teodora San
Gabriel, renounced their corresponding share in the intestate
estate in favor of Hilarion Barcelona for having shouldered the
claims against the estate. Consequently, Hilarion Barcelona
commenced to possess actually, openly, publicly, continuously
and under claim of title, adverse to all other claimants and
exclusive of any other right and against the whole world for
more than ten years, that portion of the estate ceded to him by
his co-heirs, paying the corresponding real taxes form 1940 to
1953 (Exhibit 7-7-A).
However, on April 14, 1951, Simeona Barcelona, Quirico San
Gabriel and Teodora San Gabriel filed the present action,
claiming that in the settlement of the parties in the
aforementioned Special Proceedings No. 6585, Canuto
Sanchez, because of inability or unwillingness to meet to total
indebtedness of the estate of his deceased wife, agreed to
transfer, as in the fact he did transfer, as a sort of compromise
and settlement to Hilarion and his co-heirs, the entire two
parcels of land in question; chan roblesvirtualawlibrarythat one
week after the settlement was made, Plaintiffs went to the house
of Defendant, and because the latter was only one who had
shouldered the expenses of litigation and because
said Plaintiff did not have the money with which to reimburse
him of their corresponding share therein, they all agreed that he
was to take the possession and cultivation of the lands until after
he would have been reimbursed of his expenses, in which even
partition of the land was to be made; chan
roblesvirtualawlibrarythat in the months of November 1952, and
May, 1945, Plaintiffdemanded the partition of the properties on
the ground that probably Appellee had already recovered his
expenses out of the produce, but Defendant told them that he
had not recovered them yet though he promise to give them
palay, which he did, amounting to 15 cavans of the harvest of
October 1945 and another 30 cavans in February, 1951, when
he told Plaintiffs that they did not have anymore share in the
lands in litigation.
Answering the complaint, Defendant avers that if he took
possession of the parcels of land it was because he purchased
the share of Canuto Sanchez consisting of one-half of the estate
and that is his co-heirs renounced to the other half in his favor
because of their inability to reimburse him of their share in the
expenses of the litigation.
After trial, the lower court dismissed the complaint,
declaring Defendant as the sole and exclusive owner of the two
parcels of land mentioned in paragraph 2 of the amended
complaint. Not satisfied with the judgment Plaintiffs appealed
and now maintain that the lower court erred cralaw.
It will be observed that the Court of Appeals found as a fact that
Canuto Sanchez had sold his one-half share of the two lots in
question to Hilarion Barcelona for a valuable consideration, by
means of a private instrument. Appellants herein question the
validity of the conveyance, but their contention is disposed of
and denied by the Court of Appeals, properly in our opinion, in
the following considerations, which we
reproduce:chanroblesvirtuallawlibrary
As already stated elsewhere, the spouses Canuto Sanchez
Leoncia Barcelona was childless and had acquired out of their
common funds two parcels of land. Upon the death of the wife,
one-half of the conjugal properties passed to the surviving
husband, and at the same time had to enjoy the usufruct of the
other half. As to the portion that under the law passed to him,
the surviving spouse could dispose the same in anyway he
wanted to, with only the limitations provided by law. Disposing
his share by way of sale was certainly not one of his legal
limitations. However, it is maintained that the private instrument
embodying the conveyance of the portion belonging to Canuto
Sanchez is spurrious and self-serving. It is significant to note in
this connection that Plaintiffs are not the heirs of Canuto
Sanchez, and, therefore, they have no reason whatsoever to
assail the way he had disposed of the property that lawfully
belonged to him, nor the way Hilarion Barcelona acquired the
same. It was only pro forma when the agreement dividing
equally the conjugal properties was reduce in writing (Exhibit
2), for the simple reason that the law adjucates one-half of this
kind of property to surviving spouse. The non-participation of the
co-heirs of Hilarion Barcelona in the execution of the private
instrument (Exhibit 2), is of no moment, because they had no
right at all to participate in the disposition of the share of Canuto
Sanchez for valuable consideration.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
Appellants further maintain that inasmuch as Exhibit 2 purports
to be an amicable settlement and sale between Hilarion
Barcelona and Canuto Sanchez in connection with the
properties involved in the intestate estate of the deceased
Leoncia Barcelona among whose heirs are Appellants who did
not participate in the execution thereof; chan
roblesvirtualawlibrarythe same cannot be admitted against them
on the principle of res inter alios acta. The main consideration
for the amicable settlement of the alleged litigation between
Hilarion Barcelona and Canuto Sanchez was that the conjugal
property of the spouses Canuto and Leoncia shall be partitioned
equally between the surviving spouse on one hand and the heirs
of the deceased spouse on the other. In view of the fact that the
consideration does not supplement what the law provides, for its
provision was simply reiterated therein, we believe that the
recipients of their corresponding share need not approve what
the law gives them. Furthermore, the litigation was between
Hilarion Barcelona and Canuto Sanchez and for the amicable
settlement thereof does not need the intervention of other
parties not pleaded therein, as in the case of Appellants.
To us, the main question involved in the appeal is the alleged
renunciation of the inheritance in favor of Hilarion Barcelona by
his sister Simeona Barcelona in her own behalf and by Aniceto
San Gabriel brother-in-law of the deceased Leoncia Barcelona,
on behalf of his supposed minor children, now
herein Appellants Quirico San Gabriel and Teodora San Gabriel.
Said renunciation may be regarded as in the nature of a partition
of one-half of the conjugal properties left by Leoncia Barcelona
among her heirs, namely Hilarion and Simeona, brother and
sister, respectively, and Quirico and Teodora San Gabriel,
nephew and niece, respectively, children of another sister of
hers. Among other grounds, Appellants invoke the Statute of
Frauds, claiming that conveyance of real property should be
evidenced by a written instrument. In the first place, partition
among heirs or renunciation of an inheritance by some of them
is not exactly a conveyance of the contract takes it out of the
operation of the property from one to the other, but rather a
confirmation or ratification of title or right to property by the heir
renouncing in favor of another heir accepting and receiving the
inheritance. Furthermore, in the case of Hernandez, et al., vs.
Andal, et al., 44 Off. Gaz. No. 8 p. 2672, this Tribunal held that
the Statute of Frauds enacted in the Philippines first in section
335 of the former Code of Civil Procedure, and now in Rule 123,
section 21 of the Rules of Court, has been uniformly interpreted
in a long line of decisions to be applicable to executory and not
to completed or executed contracts, and that performance of the
contract takes it out of the operation of the Statute of
Frauds; chan roblesvirtualawlibraryand that in this jurisdiction,
on grounds of equity, where no rights of creditors are involved, it
is competent for the heirs of an estate to enter into an oral
agreement for distribution of the estate among themselves.
The above mentioned rule is really wise, if not necessary, for
otherwise, thousands and thousands of oral partitions made
among heirs in our rural communities, involving unregistered
properties of relatively small value, would have to be declared
null and void. It is of general knowledge that in the provinces,
specially in the barrios, when a person dies leaving small
parcels of land not included in the Torrens System of
registration, either through ignorance of the law or in order to
avoid expenses in the way of legal services, notarial fees, and
fees of registration, the heirs merely come together, make a list
of the properties included in the estate, pay off small debts and
sums advanced by some of the heirs, specially for expenses
incurred during the last illness of the decedent and for his
funeral, and then proceed to assign to each one his share of the
estate, even taking into account the last instructions and wishes
of the decedent. So far, this practice has been found to be not
only convenient and inexpensive, but even advisable, and is
accepted by the people, and we find no good reason for
disturbing said practice. Now, when valuable properties,
specially those covered by certificates of title, are involved in the
partition, perhaps strict compliance with the law may be
advisable, even necessary.
For this reason we find and hold that the oral partition or
renunciation of inheritance by Simeona Barcelona for that
portion of the conjugal property belonging to her deceased sister
Leoncia, is valid and binding upon her. Not so with respect to
Quirico and Teodora. If they were minors at the time of the oral
partition, their father, Aniceto San Gabriel, not being a judicial
guardian duly appointed by the court and lacking judicial
authority, could not validly make the renunciation or consent to
the partition on behalf of his minor children; chan
roblesvirtualawlibraryand if, as insinuated, Quirico and Teodora
were no longer minors at that time, then they cannot be bound
by said partition or renunciation for the simple reason that they
did not take part in it.
But the Court of Appeals held that Hilarion Barcelona had
acquired the property in question through prescription for the
reason that since 1940, he had taken possession thereof as
owner, occupied it continuously, paid the taxes therefore, and
even improved the same. To this, we cannot agree. The property
in litigation, being registered land under the provisions of Act
496, is not subject to prescription, and it may not be claimed that
imprescriptibility is in favor only of the registered owner,
because as we have held in the cases of Teofila de Guinoo, et
al., vs. Court of Appeals, (97 Phil., 235) and Gil Atun, et al., vs.
Eusebio Nuez (97 Phil., 762), prescription is unavailing not
only against the registered owner, but also against his hereditary
successors because the latter merely step into the shoes of the
decedent by operation of law and are merely the continuation of
the personality of their predecessor in interest.
It is, therefore, clear that Quirico and Teodora, as heirs of the
sister of the deceased Leoncia, have the right to one-third of the
one-half of the conjugal property which belonged to said
deceased, or rather one-sixth of the two parcels already
mentioned, while Hilarion Barcelona has a right to five-sixth, for
the reason that he bought three-sixths or one-half thereof from
Canuto Sanchez as the latters one-half share of said conjugal
property, and he (Hilarion) received the one-sixth portion
renounced in his favor by his sister Simeona, and one-sixth
portion is his own share of the inheritance. From the year 1941,
Hilarion has to account for the products of the property and give
to Quirico and Teodora their one-sixth share of the same. On
pages 44 and 45 of the brief for the Petitioners may be found a
statement and computation of the amount of palay received by
Hilarion for 15 years and the price thereof, based on the price of
palay for each of those years, according to the certification of
the Bureau of Commerce and Industry, with a total value of
P11,002.50. Their one- sixth share of these sum of P11,002.50
is P1,833.75. Deducting from this last figure the price of the 15
cavans of palay valued at P298.50 and 30 cavans of palay
valued at P363.00, or a total of P661.50, received from him by
the Petitioners in the years 1945 and 1951, respectively, we
have a balance of P1,175.25. At the same time, for the reason
that Quirico and Teodora will receive one-sixth of the two lots in
question and one-sixth of the net value of the products for 15
years, they should also bear one-sixth of all the amounts
advanced by Hilarion such as P1,070 to pay off the debts of the
estate, P2,000 for funeral expenses, and court expenses
because of the intestate proceedings, and P2,000 spent by him
to improve the property by converting the same from sugar to
rice lands, and P208.50 as real estate taxes for 15 years or a
total of P5,278.50. Their one-sixth share of these expenses
amounts to P879.75. Subtracting this sum from the last balance
P1,172.25 will give a net balance of P292.50 in favor of Quirico
and Teodora.
In this connection it should be stated that Hilarion may be
regarded as a possessor in good faith for the reason that in
taking possession of the entire property, he was of the belief that
there had been a valid renunciation of the one-sixth share
corresponding to Quirico and Teodora.
In view of the foregoing, Hilarion Barcelona and Quirico and
Teodora San Gabriel may partition the two parcels in litigation in
the proportion above indicated, namely, five-sixth for Hilarion
and the remaining one-sixth for Quirico and Teodora. Hilarion is
ordered to pay the latter the sum of P292.50. No costs.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
G.R. No. 104846 November 23, 1995
RODRIGO GABUYA represented by his attorney-in-fact
LUCIA PONCE, petitioner,
vs.
ANTONIO LAYUG and HON. FEDERICO NOEL, REGIONAL
TRIAL COURT, ILIGAN CITY, BRANCH 2,respondents.
BELLOSILLO, J.:
This is a petition for certiorari and prohibition under Rule 65 of
the Rules of Court seeking to annul the orders dated 16 October
1991 and 11 March 1992 of respondent Judge Federico V. Noel,
Regional Trial Court, Lanao del Norte, Br. 2, in Civil Case No. II-
1408, Antonio Layug v. Rodrigo Gabuya, and to annul the
proceedings held thereon. The questioned orders and
proceedings are alleged to unduly interfere with the final
judgment of this Court in G.R. No. 75364 involving the same
parties, the same facts and the same issues. 1
On 4 October 1978 private respondent Antonio Layug entered
into a contract with petitioner Rodrigo Gabuya for the purchase
by the former of the latter's twelve (12) lots situated in Iligan City
for the price of P120,000.00 payable in three (3) yearly
installments. Respondent Layug paid the first two (2) annual
installments totaling P80,000.00 but failed to pay the last
installment of P40,000.00. When formal demands for payment
were made by petitioner and respondent repeatedly failed to pay
the former brought suit in the then Court of First Instance of
Lanao del Norte (now Regional Trial Court) for annulment of
contract and for recovery of damages against Layug.
After trial judgment was rendered in favor of petitioner.
Respondent appealed to the Court of Appeals which on 30
August 1985 affirmed the judgment. The appellate court (1)
ordered the rescission of the conditional sale of the twelve (12)
lots described in the contract; (2) declared as rentals for the
twelve (12) lots from 1978 to the present (30 August 1985) all
payments made by respondent Layug to Gabuya plus the legal
interest thereon from the execution of the contract; (3) ordered
respondent Layug to vacate the twelve (12) lots and deliver the
possession thereof to petitioner Gabuya; and, (4) ordered
respondent Layug to pay petitioner Gabuya the sum of
P5,000.00 as attorney's fees and to pay the costs.
On appeal to us we affirmed the Court of Appeals particularly
insofar as it authorized the cancellation by petitioner Gabuya of
the contract of sale with respondent Layug but modified the
same to the affect that the cancellation should be effective and
fully operative only upon payment of the "cash surrender value"
of his payments in the sum of P40,000.00.
On 8 March 1989 our decision became final and executory.
Consequently, on 31 May 1989 a writ of execution was issued
by the trial court. On 8 June 1989 a certificate of turnover was
issued by Sheriff Elias Anacleto in favor of petitioner. But the
order of execution was elevated by respondent Layug through a
petition for certiorari to the Court of Appeals which subsequently
dismissed it.
On 30 September 1991 the sheriff submitted to the trial court a
return of the writ of execution with the recommendation that the
buildings of private respondent found in the property be
demolished.
Meanwhile, on 27 June 1989 respondent Layug filed a
complaint for specific performance with prayer for a temporary
restraining order against petitioner seeking reimbursement for
the value of the improvements, buildings and materials he
(Layug) introduced in the premises covered by the contract of
sale which by final judgment of this Court was already ordered
rescinded.
His motion to dismiss in the court below having been denied
petitioner filed his answer to the complaint.
On 16 October 1991 respondent judge issued an order directing
Deputy Provincial Sheriff Salcedo "to refrain from
disposs(ess)ing plaintiff of the possession of the property until
ordered by the court." 2 On 22 January 1992 the trial court on
motion of petitioner reconsidered its order. However on 11
March 1992, this time upon motion of respondent Layug, it again
reconsidered its order and reinstated the restraining order of 16
October 1991 against Deputy Sheriff Salcedo. Hence this
petition by Rodrigo Gabuya against respondent judge and
Antonio Layug alleging grave abuse of discretion amounting to
lack of jurisdiction on the part of respondent judge in taking
cognizance of Civil Case No. II-1408 and in issuing the
questioned orders.
There is obvious merit in the petition. The final judgment of this
Court in G.R. No. 75364 promulgated 23 November 1988
involving the same parties, facts and issues constitutes an
absolute bar to Civil Case No. II-1408 now pending with the
Regional Trial Court of Lanao del Norte, Br. 2. It is final as to all
claims and demands of petitioner Gabuya and respondent
Layug with regard to the twelve (12) lots in Iligan City subject
matter of the contract of sale ordered cancelled by this Court.
This judgment binds the parties not only as to every matter
offered and received to sustain or defeat their claims or demand
but as to any other admissible matter which might have been
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
offered for that purpose and of all other matters that could have
been adjudged in that case.
In the case before us, the claim for reimbursement of the value
of improvements introduced by respondent Layug on the
property subject of the contract of sale should have been raised
by him as a counterclaim in the complaint for annulment of
contract before the trial court in the first case instituted by
petitioner Gabuya. The failure of respondent Layug to raise
these matters therein precludes the re-litigation of the same
facts in a separate complaint. It has been ruled that when
defendants are sued for recovery of a tract of land they ought to
have presented a counterclaim for the value of the
improvements thereon and the amount of damages suffered by
them because the claim for such improvements and indemnity is
necessarily connected with the suit for the restitution or recovery
of land claimed to have been improved, and with the result of
the execution of the judgment awarding recovery. 3
On the basis of the foregoing, the questioned orders issued by
respondent judge on 16 October 1991 and 11 March 1992
restraining the deputy sheriff from implementing the writ of
execution of the final judgment of this Court in G.R. No. 75364
were issued by respondent judge with grave abuse of discretion
amounting to lack of jurisdiction.
WHEREFORE, the petition is GRANTED. The questioned
orders of respondent judge dated 16 October 1991 and 11
March 1992, as well as the proceedings in Civil Case No. II-
1408 now pending with the Regional Trial Court of Lanao del
Norte, Br. 2, are ANNULLED and SET ASIDE. Respondent
judge, or whoever may now be acting in his behalf or assigned
to the case, is directed to pursue immediately the
implementation of the writ of execution issued on 31 May 1989
to satisfy the judgment that has long become final and
executory. Costs against private respondent.
SO ORDERED.
G.R. No. 73039 October 9, 1987
PERFECTA CAVILI, PRIMITIVO CAVILI and QUIRINO
CAVILI, petitioners,
vs.
HON. TEODORO N. FLORENDO, Presiding Judge, Branch
XXXVI, Regional Trial Court of Negros Oriental, 7th Judicial
Region, CLARITA CAVILI, ULPIANO CAVILI, ESTRELLA
CAVILI, PLACIDA CAVILI, ET AL.,respondents.
GUTIERREZ, JR., J.:
This is a petition to review and set aside two orders of the then
Court of First Instance of Negros Oriental, namely: (1) the order
dated October 11, 1985, disqualifying Perfects Cavili dela Cruz
as a witness in Civil Case No. 6880 entitled "Clarita Cavili, et al.
v. Perfecta Cavili, Quirino Cavili, and Primitivo Cavili" and (2) the
order dated November 26, 1985, refusing to reconsider the
previous orders of disqualification and resetting the reception of
evidence for the defendants to December 19 and 20, 1985 with
a warning that should defendants' witnesses fail to appear in
court on said date, they will be deemed to have waived their
right to be witnesses in this case.
The private respondents filed Civil Case No. 6880 with the Court
of First Instance of Negros Oriental against herein petitioners for
Partition, Accounting, and Damages. After the case was raffled
to Branch I presided over by Judge Augusto S. Villarin,
summons was issued to the three petitioners, all at Bayawan
Negros Oriental which was the address indicated in the
complaint.
After trying to effect service, the process server went back to the
court with the following return of service to Quirino and Primitivo
Cavili not contacted, according to Perfecta Cavili, subject
persons is (sic) staying in Kabangkalan, Negros Occidental."
Meanwhile, Atty. Jose P. Alamino filed a motion for extension to
answer in behalf of the defendants, manifesting the
representation of his client Perfecta Cavili that she will inform
her brothers Primitivo and Quirino about the case.
The defendants, however, failed to file their answer within the
request period and upon motion of the plaintiffs, the defendants
were declared in default, and on October 5, 1979, a judgment by
default was promulgated by Judge Augusto S. Villarin.
The records of the case, however, show that a Manifestation
was filed by Atty. Jose P. Alamino informing the court that since
he never met Primitivo and Quirino Cavili, who are residents of
another province, he desisted from further appearing in the case
in their behalf.
On November 7, 1979, Atty. Jose P. Alamillo received a copy of
the decision. On December 7, 1979, he filed a motion for new
trial in behalf of the defendants on grounds of lack of jurisdiction
and, with a meritorious defense that the properties sought to be
partitioned have already been the subject of a written partition
agreement between the direct heirs of the late Bernardo Cavili
who are the predecessors of the parties in this case. In/an order
dated April 23, 1980, the court granted said motion.
The plaintiffs filed a motion for reconsideration of the order
granting new trial and at the same time prayed that a writ of
execution be issued but only in so far as defendant Perfecta
Cavili was concerned.
In an order dated July 21, 1981, Judge Cipriano Vamenta of
Branch III of the Court of First Instance of Negros Oriental to
whom the case had been assigned after a re-raffle, set aside the
order of April 23, 1980 and directed the execution of the October
5, 1979 decision without qualification ruling that the petitioners'
remedy should have been appeal rather than new trial.
Their motion for reconsideration having been denied on August
11, 1981, the defendants, now petitioners, brought the case to
this Court through a petition for certiorari, G.R. No. 57771,
entitled "Quirino Cavili, et al., Petitioners vs. Hon. Cipriano
Vamenta, et al., Respondents "
On May 31, 1982, this Court rendered a decision, the dispositive
portion of which reads:
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
WHEREFORE, Our resolution dismissing the
petition is hereby reconsidered; the petition is
granted; and the order dated July 21, 1981,
is set aside while that of April 23, 1980, is
revived. (No special pronouncement as to
costs. Rollo p. 21)
Thereafter, the pre-trial and trial of Civil Case No. 6880 was
scheduled on October 9, 10, and 11, 1985 before Branch XXXVI
of the Regional Trial Court, presided by respondent Judge
Teodoro N. Florendo. The defendants, (now petitioners),
presented Perfects Cavili dela Cruz as their first witness. The
respondents, through counsel moved for her disqualification as
a witness on the ground that having been declared in default,
Perfects Cavili has lost her standing in court and she cannot be
allowed to participate in all premise the even as a witness. The
court, through the respondent judge, sustained the respondents'
contention and disqualified her from testifying.
The petitioners, through counsel, moved for a reconsideration of
the ruling.
On November 26, 1985, the lower court issued an order denying
reconsideration of its Order dated October 11, 1985 disqualifying
Perfecta Cavili dela Cruz as a witness in Civil Case No. 6880.
Hence, this petition.
Petitioner Perfecta Cavili's competence as a witness is put in
issue by the private respondents.
Section 18, Rule 130 of the Revised Rules of Court states who
are qualified to be witnesses. It provides:
Section 18. Witnesses; their qualifications. Except as
provided in the next succeeding section, all persons who, having
organs of sense, can perceive, and perceiving, can make known
their perception to others, may be witnesses. Neither parties nor
other persons interested in the outcome of a case shall be
excluded; nor those who have been convicted of crime; nor any
person on account of his opinion on matters of religious belief.
The generosity with which the Rule allows people to testify is
apparent. Interest in the outcome of a case, conviction of a
crime unless otherwise provided by law, and religious belief are
not grounds for disqualification.
Sections 19 and 20 of Rule 130 provide for specific
disqualifications. Section 19 disqualifies those who are mentally
incapacitated and children whose tender age or immaturity
renders them incapable of being witnesses. Section 20 provides
for disqualification based on conflicts of interest or on
relationship. Section 21 provides for disqualifications based on
privileged communications. Section 15 of Rule 132 may not be a
rule on disqualification of witnesses but it states the grounds
when a witness may be impeached by the party against whom
he was called.
There is no provision of the Rules disqualifying parties declared
in default from taking the witness stand for non-disqualified
parties. The law does not provide default as an exception. The
specific enumeration of disqualified witnesses excludes the
operation of causes of disability other than those mentioned in
the Rules. It is a maxim of recognized utility and merit in the
construction of statutes that an express exception, exemption,
or saving clause excludes other exceptions. (In Re Estate of
Enriquez, 29 Phil. 167) As a general rule, where there are
express exceptions these comprise the only limitations on the
operation of a statute and no other exception will be implied.
(Sutherland on Statutory Construction, Fourth Edition, Vol. 2A,
p. 90) The Rules should not be interpreted to include an
exception not embodied therein.
The respondents, however, cite Section 2, Rule 18 on Defaults,
to wit:
Section 2. Effect of order of default. Except as provided in
section 9 of Rule 13, a party declared in default shall not be
entitled to notice of subsequent proceedings nor to take part in
the trial.
They advance the argument that to allow Perfecta Cavili to
stand as witness would be to permit a party in default "to take
part in the trial."
An explanation of the Rule is in order.
Loss of standing in court is the consequence of an order of
default. Thus, a party declared in default is considered out of
court and cannot appear therein, adduce evidence, and be
heard and for that reason he is not entitled to notice. (Rule 18,
Rules of Court; Lim Toco v. Go Fay, 80 Phil. 166) However, "loss
of pending" must be understood to mean only the forfeiture of
one's rights as a party litigant, contestant or legal adversary. A
party in default loses his right to present his defense, control the
proceedings, and examine or cross-examine witnesses. He has
no right to expect that his pleadings would be acted upon by the
court nor may he object to or refute evidence or motions filed
against him. There is nothing in the rule, however, which
contemplates a disqualification to be a witness or a opponent in
a case. Default does not make him an incompetent.
As opposed to a party litigant, a witness is merely a beholder, a
spectator or onlooker, called upon to testify to what he has seen,
heard, or observed. As such, he takes no active part in the
contest of rights between the parties. Cast in the cited role of
witness, a party in default cannot be considered as " a part in
the trial." He remains suffering the effects of an order of default.
A party in default may thus be cited as a witness by his co-
defendants who have the standing and the right to present
evidence which the former may provide. The incidental benefit
giving the party in default the opportunity to present evidence
which may eventually redound to his advantage or bring about a
desired result, through his co-defendants, is of minor
consequence.
Of greater concern or importance in allowing the presence of
Perfecta Cavili as a witness in the case at bar, is the
preservation of the right of petitioners Quirino and Primitivo
Cavili to secure the attendance of witnesses and the production
of evidence in their behalf. To reject Perfects Cavili's
presentation of testimonial evidence would be to treat Primitivo
and Quirino, as if they too were in default. There is no reason
why the latter should also be made to bear the consequences of
Perfecta's omission. Moreover, we cannot deprive Quirino and
Primitivo of the only instrument of proof available to them, as
Perfecta alone has been in possession and administration of the
claim.
WHEREFORE, in view of the foregoing, the petition is hereby
GRANTED. The order of the respondent court disqualifying.
Perfects Cavili dela Cruz as a witness in Civil Case No. 6880 is
hereby SET ASIDE. The case is remanded to the court a quo for
Wither proceedings. The temporary restraining order issued on
January 6, 1986 is LIFTED.
SO ORDERED.
CIVIL PROCEDURE RULE 7-9 FULL TEXT

G.R. No. L-53880 March 17, 1994

ENRICO L. PACETE, CLARITA DE LA CONCEPCION,

EMELDA C. PACETE, EVELINA C. PACETE and EDUARDO
C. PACETE, petitioners,
vs.
HON. GLICERIO V. CARRIAGA, JR. and CONCEPCION
(CONCHITA) ALANIS PACETE, respondents.

VITUG, J.:

The issue in this petition for certiorari is whether or not the Court
of First Instance (now Regional Trial Court) of Cotabato, Branch
I, in Cotabato City, gravely abused its discretion
in denying petitioners' motion for extension of time to file their
answer in Civil Case No. 2518, in declaring petitioners in default
and in rendering its decision of 17 March 1980 which, among
other things, decreed the legal separation of petitioner Enrico L.
Pacete and private respondent Concepcion Alanis and held to
be null and void ab initio the marriage of Enrico L. Pacete to
Clarita de la Concepcion.

On 29 October 1979, Concepcion Alanis filed with the court

below a complaint for the declaration of nullity of the marriage
between her erstwhile husband Enrico L. Pacete and one Clarita
de la Concepcion, as well as for legal separation (between
Alanis and Pacete), accounting and separation of property. In
her complaint, she averred that she was married to Pacete on
30 April 1938 before the Justice of the Peace of Cotabato,
Cotabato; that they had a child named Consuelo who was born
on 11 March 1943; that Pacete subsequently contracted (in
1948) a second marriage with Clarita de la Concepcion in
Kidapawan, North Cotabato; that she learned of such marriage
only on 01 August 1979; that during her marriage to Pacete, the
latter acquired vast property consisting of large tracts of land,
fishponds and several motor vehicles; that he fraudulently
placed the several pieces of property either in his name and
Clarita or in the names of his children with Clarita and other
"dummies;" that Pacete ignored overtures for an amicable
settlement; and that reconciliation between her and Pacete was
impossible since he evidently preferred to continue living with
Clarita.

The defendants were each served with summons on 15

November 1979. They filed a motion for an extension of twenty
(20) days from 30 November 1979 within which to file an
answer. The court granted the motion. On 18 December 1979,
appearing through a new counsel, the defendants filed a second
motion for an extension of another thirty (30) days from 20
December 1979. On 07 January 1980, the lower court granted
the motion but only for twenty (20) days to be counted from 20
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
December 1979 or until 09 January 1980. The Order of the court
was mailed to defendants' counsel on 11 January 1980. Likely
still unaware of the court order, the defendants, on 05 February
1980, again filed another motion (dated 18 January 1980) for an
extension of "fifteen (15) days counted from the expiration of the
30-day period previously sought" within which to file an answer.
The following day, or on 06 February 1980, the court denied this
last motion on the ground that it was "filed after the original
period given . . . as first extension had expired." 1
The plaintiff thereupon filed a motion to declare the defendants
in default, which the court forthwith granted. The plaintiff was
then directed to present her evidence. 2 The court received
plaintiff's evidence during the hearings held on 15, 20, 21 and
22 February 1980.
On 17 March 1980, the court 3 promulgated the herein
questioned decision, disposing of the case, thus
WHEREFORE, order is hereby issued ordering:
1. The issuance of a Decree of Legal Separation of the
marriage between, the plaintiff, Concepcion (Conchita)
Alanis Pacete and the herein defendants, Enrico L. Pacete,
in accordance with the Philippine laws and with
consequences, as provided for by our laws;
2. That the following properties are hereby declared as the
conjugal properties of the partnership of the plaintiff,
Concepcion (Conchita) Alanis Pacete and the defendant,
Enrico L. Pacete, half and half, to wit:
1. The parcel of land covered by TCT No. V-815 which is a
parcel of land situated in the barrio of Langcong,
Municipality of Matanog (previously of Parang), province of
Maguindanao (previously of Cotabato province) with an
area of 45,265 square meters registered in the name of
Enrico Pacete, Filipino, of legal age, married to Conchita
Alanis as shown in Exhibits "B" and "B-1" for the plaintiff.
2. A parcel of land covered by Transfer Certificate of Title
No. T-20442, with an area of 538 square meters and
covered by Tax Declaration No. 2650 (74) in the name of
Enrico Pacete, situated in the Poblacion of Kidapawan,
North Cotabato, together with all its improvements, which
parcel of land, as shown by Exhibits "K-1" was acquired by
way of absolute deed of sale executed by Amrosio Mondog
on January 14, 1965.
3. A parcel of land covered by Transfer Certificate of Title
No. T-20424 and covered by Tax Declaration No. 803 (74),
with an area of 5.1670 hectares, more or less, as shown by
Exhibit "R", the same was registered in the name of Enrico
Pacete and the same was acquired by Enrico Pacete last
February 17, 1967 from Ambag Ampoy, as shown by
Exhibit "R-1", situated at Musan, Kidapawan, North
Cotabato.
4. A parcel of land situated at Lanao, Kidapawan, North
Cotabato, with an area of 5.0567 hectares, covered by Tax
Declaration No. 4332 (74), as shown by Exhibit "S", and
registered in the name of Enrico Pacete.
5. A parcel of land covered by Transfer Certificate of Title
No. T-9750, situated at Lika, Mlang, North Cotabato, with
an area of 4.9841 hectares and the same is covered by Tax
Declaration No. 803 (74) and registered in the name of
Enrico Pacete and which land was acquired by Enrico
Pacete from Salvador Pacete on September 24, 1962, as
shown by Exhibit "Q-1".
6. A parcel of land covered by Transfer Certificate of Title
No. T-9944, with an area of 9.9566 and also covered by Tax
Declaration No. 8608 (74) and registered in the name of the
defendant Enrico L. Pacete which Enrico L. Pacete
acquired from Sancho Balingcos last October 22, 1962, as
shown by Exhibit "L-1" and which parcel of land is situated
at (Kialab), Kiab, Matalam, North Cotabato.
7. A parcel of land covered by Transfer Certificate of Title
No. T-9227, situated at Kiab, Matalam, North Cotabato, with
an area of 12.04339 hectares, more or less, and also
covered by Tax Declaration No. 8607 (74) both in the name
of the defendant Enrico L. Pacete which he acquired last
October 15, 1962 from Minda Bernardino, as shown by
Exhibit "M-1".
8. A parcel of land covered by Transfer Certificate of Title
No. T-9228, situated at Kiab, Matalam, North Cotabato, with
an area of 10.8908 hectares, registered in the name of
Enrico Pacete and also covered by Tax Declaration No.
5781 (74) in the name of Enrico Pacete and which parcel of
land he acquired last September 25, 1962 from Conchita
dela Torre, as shown by Exhibit "P-1".
9. A parcel of land covered by Transfer Certificate of Title
No. T-10301, situated at Linao, Matalam, North Cotabato,
with an area of 7.2547 hectares, registered in the name of
Enrico Pacete and also covered by Tax Declaration No.
8716 (74) also in the name of Enrico Pacete which Enrico
Pacete acquired from Agustin Bijo last July 16, 1963, as
shown by Exhibit "N-1".
10. A parcel of land covered by Transfer Certificate of Title
No. 12728 in the name of the defendant, Enrico L. Pacete,
with an area of 10.9006 hectares, situated at Linao,
Matalam, North Cotabato and is also covered by Tax
Declaration No. 5745 (74) in the name of Enrico Pacete, as
shown on Exhibit "O" and which Enrico Pacete acquired
last December 31, 1963 from Eliseo Pugni, as shown on
Exhibit "0-1".
3. Ordering the Cancellation of Original Certificate of Title
No. P-34243 covering Lot No. 1066, issued in the name of
Evelina Pacete, situated at Kiab, Matalam, North Cotabato,
and ordering the registration of the same in the joint name
of Concepcion (Conchita) Alanis Pacete and Enrico L.
Pacete as their conjugal property, with address on the part
of Concepcion (Conchita) Alanis Pacete at Parang,
Maguindanao and on the part of Enrico L. Pacete at
Kidapawan, North Cotabato.
4. Ordering likewise the cancellation of Original Certificate
of Title No. V-20101, covering Lot No. 77, in the name of
Eduardo C. Pacete, situated at New Lawaan, Mlang, North
Cotabato, and the issuance of a new Transfer Certificate of
Title in the joint name of (half and half) Concepcion
(Conchita) Alanis Pacete and Enrico L. Pacete.
5. Ordering likewise the cancellation of Original Certificate
of Title No. P-29890, covering Lot 1068, situated at Kiab,
Matalam, North Cotabato, with an area of 12.1031
hectares, in the name of Emelda C. Pacete and the
issuance of a new Transfer Certificate of Title in the joint
name (half and half) of Concepcion (Conchita) Alanis
Pacete and Enrico L. Pacete; and declaring that the
fishpond situated at Barrio Tumanan, Bislig, Surigao Del
Sur, with an area of 48 hectares and covered by Fishpond
Lease Agreement of Emelda C. Pacete, dated July 29,
1977 be cancelled and in lieu thereof, the joint name of
Concepcion (Conchita) Alanis Pacete and her husband,
Enrico L. Pacete, be registered as their joint property,
including the 50 hectares fishpond situated in the same
place, Barrio Timanan, Bislig, Surigao del Sur.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
6. Ordering the following motor vehicles to be the joint
properties of the conjugal partnership of Concepcion
(Conchita) Alanis Pacete and Enrico L. Pacete, viz:
a. Motor vehicle with Plate No. T-RG-783; Make, Dodge;
Motor No. T137-20561; Chassis No. 83920393, and Type,
Mcarrier;
b. Motor vehicle with Plate No. T-RG-784; Make, Dodge;
Motor No. T214-229547; Chassis No. 10D-1302-C; and
Type, Mcarrier;
c. Motor vehicle with Plate No. J-PR-818; Make, Ford;
Motor No. GRW-116188; Chassis No. HOCC-GPW-1161-
88-C; Type, Jeep;
d. Motor vehicle with Plate No. TH-5J-583; Make, Ford:
Motor No. F70MU5-11111; Chassis No. HOCC-GPW-
1161188-G; Type, Stake;
e. Motor vehicle with Plate No. TH-5J-584; Make, Hino;
Motor No. ED300-45758; Chassis No. KB222-22044; Type,
Stake; and
f. Motor vehicle with Plate No. TH-5J-585; Make, Ford:
Motor No. LTC-780-Dv; Chassis No. 10F-13582-K; Type,
Stake.
7. Ordering the defendant Enrico L. Pacete to pay the
plaintiff the sum of P46,950.00 which is the share of the
plaintiff in the unaccounted income of the ricemill and corn
sheller for three years from 1971 to 1973.
8. Ordering the defendant, Enrico L. Pacete, to reimburse
the plaintiff the monetary equipment of 30% of whether the
plaintiff has recovered as attorney's fees;
9. Declaring the subsequent marriage between defendant
Enrico L. Pacete and Clarita de la Concepcion to be
void ab initio; and
10. Ordering the defendants to pay the costs of this suit. 4
Hence, the instant special civil action of certiorari.
Under ordinary circumstances, the petition would have outrightly
been dismissed, for, as also pointed out by private respondents,
the proper remedy of petitioners should have instead been
either to appeal from the judgment by default or to file a petition
for relief from judgment. 5 This rule, however, is not inflexible; a
petition for certiorari is allowed when the default order
is improperly declared, or even when it is properly declared,
where grave abuse of discretion attended such declaration. 6 In
these exceptional instances, the special civil action
of certiorari to declare the nullity of a judgment by default is
available. 7 In the case at bench, the default order
unquestionably is not legally sanctioned. The Civil Code
provides:
Art. 101. No decree of legal separation shall
be promulgated upon a stipulation of facts or
by confession of judgment.
In case of non-appearance of the defendant,
the court shall order the prosecuting attorney
to inquire whether or not a collusion between
the parties exists. If there is no collusion, the
prosecuting attorney shall intervene for the
State in order to take care that the evidence
for the plaintiff is not fabricated.
The provision has been taken from Article 30 of the California
Civil Code, 8 and it is, in substance, reproduced in Article 60 of
the Family Code. 9
Article 101 reflects the public policy on marriages, and it should
easily explain the mandatory tenor of the law. In Brown
v. Yambao, 10 the Court has observed:
The policy of Article 101 of the new Civil
Code, calling for the intervention of the state
attorneys in case of uncontested
proceedings for legal separation (and of
annulment of marriages, under Article 88), is
to emphasize that marriage is more than a
mere contract; that it is a social institution in
which the state is vitally interested, so that its
continuation or interruption can not be made
to depend upon the parties themselves (Civil
Code, Article 52; Adong vs. Cheong Gee, 43
Phil. 43; Ramirez v. Gmur, 42 Phil. 855;
Goitia v. Campos, 35 Phil. 252). It is
consonant with this policy that the inquiry by
the Fiscal should be allowed to focus upon
any relevant matter that may indicate
whether the proceedings for separation or
annulment are fully justified or not.
Article 103 of the Civil Code, now Article 58 of the Family Code,
further mandates that an action for legal separation must "in no
case be tried before six months shall have elapsed since the
filing of the petition," obviously in order to provide the parties a
"cooling-off" period. In this interim, the court should take steps
toward getting the parties to reconcile.
The significance of the above substantive provisions of the law
is further underscored by the inclusion of the following provision
in Rule 18 of the Rules of Court:
Sec. 6. No defaults in actions for annulments
of marriage or for legal separation. If the
defendant in an action for annulment of
marriage or for legal separation fails to
answer, the court shall order the prosecuting
attorney to investigate whether or not a
collusion between the parties exists, and if
there is no collusion, to intervene for the
State in order to see to it that the evidence
submitted is not fabricated.
The special prescriptions on actions that can put the integrity of
marriage to possible jeopardy are impelled by no less than the
State's interest in the marriage relation and its avowed intention
not to leave the matter within the exclusive domain and the
vagaries of the parties to alone dictate.
It is clear that the petitioner did, in fact, specifically pray for legal
separation. 11 That other remedies, whether principal or
incidental, have likewise been sought in the same action cannot
dispense, nor excuse compliance, with any of the statutory
requirements aforequoted.
WHEREFORE, the petition for certiorari is hereby GRANTED
and the proceedings below, including the Decision of 17 March
1980 appealed from, are NULLIFIED and SET ASIDE. No costs.
SO ORDERED.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
[G.R. No. L-28633. March 30, 1971.]
CENTRAL SURETY & INSURANCE COMPANY, Petitioner, v.
C. N. HODGES and THE COURT OF
APPEALS, Respondents.
SYLLABUS
1. CIVIL LAW; SPECIAL CONTRACTS; AGENCY; GENERAL
POWERS; EXTINGUISHMENT; REVOCATION; PUBLICATION
THEREOF REQUIRED; CASE AT BAR Article 1922 of our
Civil Code provides: If the agent had general powers, revocation
of the agency does not prejudice third person who acted in good
faith and without knowledge of the revocation. Notice of the
revocation in a newspaper of general circulation is a sufficient
warning to third persons." It is not disputed that petitioner has
not caused to be published and, notice of the revocation of Mrs.
Mesas authority to issue surety bonds on its behalf,
notwithstanding the fact that the powers of Mrs. Mesa, as its
branch manager in Iloilo, were of a general nature, for she had
exclusive authority, in the City of Iloilo, to represent petitioner
herein, not with a particular person, but with the public in
general "in all the negotiations, transactions, and business
wherein the Company may lawfully transact or engage in,"
subject only to the restrictions specified in their agreement, copy
of which was attached to petitioners answer as Annex 3.
Contrary to petitioners claim, Article 1922 applies whenever an
agent has general powers not merely when the principal has
published the same, apart from the fact that the opening of
petitioners branch office amounted to a publication of the grant
of powers to the manager of said office. Then, again, by
honoring several surety bonds issued in its behalf by Mrs. Mesa
subsequently to March 15, 1952, petitioner induced the public to
believe that she had authority to issue such bonds. As a
consequence, petitioner is now estopped from pleading,
particularly against a regular customer thereof, like Hodges, the
absence of said authority.
2. INSURANCE; CLAIMS; ACTION; PRESCRIPTION.
Petitioner maintains that, having been instituted on October 24,
1955 or nine (9) months after the expiration of petitioner s
surety bond on January 23, 1955 the present action is barred
by the provision in said bond to the effect that it: ". . . will not be
liable for any claim not discovered and presented to the
Company within three (3) months from the expiration of this
bond and that the obligee hereby waives his right to file any
court action against the surety after the termination of the period
of three months above-mentioned." Interpreting an identical
provision, this Court has, however, held "that the three-month
period" prescribed therein "established only a condition
precedent, not a limitation of action." and that, when a claim
has been presented within said period, the action to enforce the
claim may be "filed within the statutory time of prescription." This
view was clarified in a subsequent case, in the sense that the
above-quoted provision was." . . merely interpreted to mean that
presentation of the claim within three months was a condition
precedent to the filing of a court action. Since the obligee in said
case presented his claim seasonably although it did not file the
action within the same period, this Court ruled that the
stipulation in the bond concerning the limitation being
ambiguous the ambiguity should be resolved against the surety,
which drafted the agreement, and that the action could be filed
within the statutory period of prescription."cralaw virtua1aw
library
3. REMEDIAL, LAW; CIVIL, PROCEDURE; ALLEGATIONS;
DOCUMENTS; RULE WHEN NO OBJECTION MADE;
RATIONALE; CASE AT BAR. It is true that, pursuant to
Section 8 of Rule 8 of the Rules of Court: "When an action or
defense is founded upon a written instrument, copied in or
attached to the corresponding pleading as provided in the
preceding section the genuineness and due execution of the
instrument shall be deemed admitted unless the adverse party,
under oath specifically denies them, and sets forth what he
claims to be the facts; but this provision does not apply when
the adverse party does not appear to be a partly to the
instrument or when compliance with an order for an inspection
of the original instrument is refused." We have however, held
that: ". . . where a case has been tried in complete disregard of
the rule and the plaintiff having pleaded a document by copy,
presents oral evidence to prove the due execution of the
document as well as the agents authority and no objections are
made to the defendants evidence in refutation, the rule will be
considered waived." In the case at bar, the parties acted in
complete disregard of or wholly overlooked the rule above-
quoted. Hodges had neither objected to the evidence introduced
by petitioner herein in order to prove that Mrs. Mesa had no
authority to issue a surety bond, much less one in excess of
P8,000.00, and took no exception to the admission of said
evidence. Hence, Hodges must be deemed to have waived the
benefits of said rule and petitioner herein cannot be held liable
in excess of the sum of P8,000.00
CONCEPCION, C.J.:
Appeal by certiorari from a decision of the Court of Appeals, the
dispositive part of which reads as follows:jgc:chanrobles.com.ph
"WHEREFORE, in view of the foregoing considerations, the
decision appealed from is modified and judgment is hereby
rendered against Central Surety & Insurance
Company:jgc:chanrobles.com.ph
"(a) To pay plaintiff C. N. Hodges the sum of P17,826.08 with
interest thereon at the rate of 12% per annum from October 24,
1955 until fully paid;"
(b) To pay plaintiff C. N. Hodges the sum of P1,551.60 as
attorneys fees; and
(c) To pay the costs."cralaw virtua1aw library
The main facts are not disputed. Prior to January 15, 1954, lots
Nos. 1226 and 1182 of the Cadastral Survey of Talisay, Negros
Occidental, had been sold by C N. Hodges to Vicente M.
Layson, for the sum of P43,000.00, payable on installments. As
of January 15, 1954, the outstanding balance of Laysons debt,
after deducting the installments paid by him prior thereto,
amounted to P15,516.00. In order that he could use said lots as
security for a loan he intended to apply from a bank, Layson
persuaded Hodges to execute in his (Laysons) favor a deed of
absolute sale over the properties, with the understanding that he
would put up a surety bond to guarantee the payment of said
balance. Accordingly, on the date above mentioned, Layson
executed, in favor of Hodges, a promissory note for P15,516.00,
with interest thereon at the rate of 1% per month, and the sum
of P1,551.60, for attorneys fees and costs, in case of default in
the payment of the principal or interest of said note. To
guarantee the same, on January 23, 1954, the Central Surety
and Insurance Company hereinafter referred to as petitioner
through the manager of its branch office in Iloilo, Mrs. Rosita
Mesa, executed in favor of Hodges the surety bond Annex B,
which was good for twelve (12) months from the date thereof.
When Layson defaulted in the discharge of his aforesaid
obligation, Hodges demanded payment from the petitioner,
which, despite repeated extensions of time granted thereto, at
its request, failed to honor its commitments under the surety
bond. On October 24, 1955, Hodges commenced, therefore, the
present action, in the Court of First Instance of Iloilo, against
Layson and petitioner herein, to recover from them, jointly and
severally, the sums of P17,826.08, representing the principal
and interest due up to said date, and P1,551.60, as attorneys
fees. In his answer to the complaint, Layson admitted the formal
allegations and denied the other allegations thereof.
Having failed to file its answer within the reglementary period,
the petitioner was, on January 18, 1956, declared in default.
When the case was called for trial, insofar as Layson was
concerned, the latter did not appear, and Hodges was allowed to
introduce his evidence. Then the trial court rendered a partial
decision against Layson, petitioner having, in the meantime,
filed a motion to set aside the order of default, which motion was
still pending resolution. Thereafter, said motion was denied, and
upon presentation of the evidence of Hodges against herein
petitioner, judgment was rendered against the latter as prayed
for in the complaint. Thereupon, petitioner filed a motion for
reconsideration and a motion for relief under Rule 38. Acting
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
thereon, His Honor, the trial Judge, later set aside its decision
against the petitioner and admitted its answer, attached to the
motion to set aside the order of default.
In its answer, petitioner disclaimed liability under the surety bond
in question, upon the ground (a) that the same is null and void, it
having been issued by Mrs. Rosita Mesa after her authority
therefor had been withdrawn on March 15, 1952; (b) that even
under her original authority, Mrs. Mesa could not issue surety
bonds in excess of P8,000.00 without the approval of
petitioners main office, which was not given to the surety bond
in favor of Hodges; and (c) that the present action is barred by
the provision in the surety bond to the effect that all claims and
actions thereon should be filed within three (3) months from the
date of its expiration on January 23, 1955. Petitioner, moreover,
set up a counterclaim for damages.
In due course, thereafter, the trial court rendered a
decision:jgc:chanrobles.com.ph
"a) Condenando a la demanda Central Surety & Insurance Co.
que pague al demandante la desde la P8,000.00 con intereses
legales a contar desde la fecha de la demanda 24 de
Octubre de 1955;
"b) Condenando a la misma demanda que pague al
demandante la suma de P600.00 en concepto de honorarios de
abogado; y
"c) Condenando, ademas, a la misma demanda que pague las
costas del juicio."cralaw virtua1aw library
Hodges appealed to the Court of Appeals (CA-G.R. No. L-
24684-R) from this decision, insofar as it limited petitioners
liability to P8,000.00. Petitioner, also, appealed to said Court
upon the ground that the trial court had erred: a) in holding
petitioner liable under a contract entered into by Its agent in
excess of her authority; (b) in sentencing petitioner to pay
Hodges the sum of P8.000.00 with interest thereon, in addition
to attorneys fees and the costs; and (c) in "not awarding"
petitioners counterclaim.
After appropriate proceedings, the Court of Appeals rendered
the decision above referred to, from which petitioner has
appealed to this Court, alleging that the Court of Appeals has
erred: (1) in finding that petitioner "was liable on a bond issued
by an agent whose authority . . . had already been withdrawn
and revoked" ; (2) "in applying the rule on implied admission by
reason of failure to deny under oath the authenticity of a
pleaded document" and (3) "in not considering the legal effect of
the waiver contained in the disputed bond and in not disposing
of this case under the light of such waiver."cralaw virtua1aw
library
The first assignment of error is predicated upon the fact that
prior to January 23, 1954, when the surety bond involved in this
case was executed, or on March 15, 1952, petitioner herein had
withdrawn the authority of its branch manager in the City of
Iloilo, Mrs. Rosita Mesa, to issue, inter alia, surety bonds and
that, accordingly, the surety bond, copy of which was attached to
the complaint as Annex B, is null and void. On this point, the
Court of Appeals had the following to say:jgc:chanrobles.com.ph
". . . we are of the opinion that said surety bond is valid. In the
first place, there appears to be no showing that the revocation of
authority was made known to the public in general by
publication, nor was Hodges notified of such revocation despite
the fact that he was a regular client of the firm. And even if
Hodges would have inquired from Mrs. Mesa as to her authority
to issue said bond, we doubt if she would disclose the contents
of the letter of March 15, 1952 in view of Central Suretys claim
that she was committing irregularities in her remittances to the
main office. Secondly, some surety bonds issued by Mrs. Mesa
in favor of Hodges after her authority had allegedly been
curtailed, were honored by the Central Surety despite the fact
that these were not reported to the main office at the time of
their issuance. These accounts were paid on January 31, 1957,
to wit: Felicito and Libertad Parra issued on August 16, 1952;
Estrella Auayan issued on November 16, 1953; Dominador
Jordan issued on August 26, 1953; and Ladislao Lachica issued
on February 28, 1953. (Exhs. F, G, H, I and J). By these acts
Central Surety ratified Mrs. Mesas unauthorized acts and as
such it is now estopped from setting forth Mrs. Mesas lack of
authority to issue surety bonds after March 15, 1952. It has
been held that although the agent may have acted beyond the
scope of his authority, or may have acted without authority at all,
the principal may yet subsequently see fit to recognize and
adopt the act as his own. Ratification being a matter of assent to
and approval of the act as done on account of the person
ratifying, any words or acts which show such assent and
approval are ordinarily sufficient. (Sta. Catalina v. Espitero, CA-
G.R. No. 27075-R, April 28, 1964, citing IV Padilla, CIVIL CODE
1959 ed., pp. 478-479; Roxas v. Villanueva, CA-G.R. No.
18928-R, June 20, 1958). Moreover. the revocation of agency
does not prejudice third persons who acted in good faith without
knowledge of the revocation. (Joson v. Garcia, CA-G.R. No.
29336-R, Nov. 19, 1962)."cralaw virtua1aw library
Indeed, Article 1922 of our Civil Code
provides:jgc:chanrobles.com.ph
"If the agent had general powers, revocation of the agency does
not prejudice third persons who acted in good faith and without
knowledge of the revocation. Notice of the revocation in a
newspaper of general circulation is a sufficient warning to third
persons."cralaw virtua1aw library
It is not disputed that petitioner has not caused to be published
any notice of the revocation of Mrs. Mesas authority to issue
surety bonds on its behalf, notwithstanding the fact that the
powers of Mrs. Mesa, as its branch manager in Iloilo, were of a
general nature, for she had exclusive authority, in the City of
Iloilo, to represent petitioner herein, not with a particular person,
but with the public in general, "in all the negotiations,
transactions, and business wherein the Company may lawfully
transact or engage in," subject only to the restrictions specified
in their agreement. copy of which was attached to petitioners
answer as Annex 3. 1 Contrary to petitioners claim, Article 1922
applies whenever an agent has general powers, not merely
when the principal has published the same, apart from the fact
that the opening of petitioners branch office amounted to a
publication of the grant of powers to the manager of said office.
Then, again, by honoring several surety bonds issued in its
behalf by Mrs. Mesa subsequently to March 15, 195 2, petitioner
induced the public to believe that she had authority to issue
such bonds. As a consequence, petitioner is now estopped from
pleading, particularly against a regular customer thereof, like
Hodges, the absence of said authority.
Let us now take up the third assignment of error and defer, until
after the same has been disposed of, the consideration of the
second assignment of error.
Under the third assignment of error, petitioner maintains that,
having been instituted on October 24, 1955 or nine (9)
months after the expiration of petitioners surety bond on
January 23, 1955 the present action is barred by the
provision in said bond to the effect that it:jgc:chanrobles.com.ph
". . . will not be liable for any claim not discovered and presented
to the Company within three (3) months from the expiration of
this bond and that the obligee hereby waives his right to file any
court action against the surety after the termination of the period
of three months above-mentioned."cralaw virtua1aw library
Interpreting an identical provision, 2 this Court has, however,
held "that the three-month period" prescribed therein
"established only a condition precedent, not a limitation of
action," and that, when a claim has been presented within said
period, the action to enforce the claim may be "filed within the
statutory time of prescription." This view was clarified in a
subsequent case, 3 in the sense that the above-quoted
provision was." . . merely interpreted to mean that presentation
of the claim within three months was a condition precedent to
the filing of a court action. Since the obligee in said case
presented his claim seasonably although it did not file the action
within the same period, this Court ruled that the stipulation in the
bond concerning the limitation being ambiguous, the ambiguity
should be resolved against the surety, which drafted the
agreement, and that the action could be filed within the statutory
period of prescription." 4
In the case at bar, it is not contended that Hodges had not
presented his claim within three (3) months from January 23,
1955. In fact, he had repeatedly demanded from petitioner
herein compliance with its obligations under the surety bond in
question, and, in reply to such demands, petitioner asked
extensions of time, on January 29, February 16, March 15, May
3, June 16, July 1 and 15, and October 15, 1955. 5 After thus
securing extensions of time, even beyond three (3) months from
January 23, 1955, petitioner cannot plead the lapse of said
period to bar the present action.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
The second assignment of error assails the finding of the Court
of Appeals to the effect that the petitioner is liable for the full
amount of surety bond despite the fact that it exceeded the
sum of P8,000.00 and hence, required, for its validity and
binding effect as against petitioner herein, the express approval
and confirmation of its Manila office, which were not secured
in view of petitioners failure to deny under oath the genuineness
and due execution of said bond, copy of which was attached to
the complaint. It is true that, pursuant to section 8 of Rule 8 of
the Rules of Court:jgc:chanrobles.com.ph
objected to the evidence introduced by petitioner herein in order
to prove that Mrs. Mesa had no authority to issue a surety bond,
much less one in excess of P8,000.00, and took no exception to
the admission of said evidence. Hence, Hodges must be
deemed to have waived the benefits of said rule and petitioner
herein cannot be held liable in excess of the sum of P8,000.00.
WHEREFORE, with the modification that petitioners liability to
Hodges is limited to said sum of P8,000.00 the period, the
petitioner was, on January 18, 1956, declared it is hereby
affirmed in all other respects, without costs. It is so ordered.

"When an action or defense is founded upon a written

instrument, copied in or attached to the corresponding pleading
as provided in the preceding section, the genuineness and due
execution of the instrument shall be deemed admitted unless
the adverse party, under oath, specifically denies them, and sets
forth what he claims to be the facts; but this provision does not
apply when the adverse party does not appear to be a party to
the instrument or when compliance with an order for an
inspection of the original instrument is refused."cralaw virtua1aw
library

We have however, held that:jgc:chanrobles.com.ph

". . . where a case has been tried in complete disregard of the

rule and the plaintiff having pleaded a document by copy,
presents oral evidence to prove the due execution of the
document as well as the agents authority and no objections are
made to the defendants evidence in refutation, the rule will be
considered waived." 6

The reason for such view was explained by this Court as

follows:jgc:chanrobles.com.ph

"Before entering upon a discussion of the questions raised by

the assignments of error, we may draw attention to a matter
which has not been mentioned either by counsel or by the court
below, but which, to prevent misunderstanding, should be briefly
explained: It is averred in the complaint that it is accompanied
by a copy of the contract between the parties (Exhibit A) which
copy, by the terms of the complaint, is made a part thereof. The
copy is not set forth in the bill of exceptions and aside from said
averment, there is no indication that the copy actually
accompanied the complaint, but an examination of the record of
the case in the Court of First Instance shows that a translation of
the contract was attached to the complaint and served upon the
defendant. As this translation may be considered a copy and as
the defendant failed to deny its authenticity under oath, it will
perhaps be said that under section 103 of the Code of Civil
Procedure the omission to so deny it constitutes an admission of
the genuineness and due execution of the document as well as
of the agents authority to bind the defendant. (Merchant v.
International Banking Corporation, 6 Phil. 314.)

"In ordinary circumstances that would be true. But this case

appears to have been tried upon the theory that the rule did not
apply; at least, it was wholly overlooked or disregarded by both
parties. The plaintiffs at the beginning of the trial presented a
number of witnesses to prove the due execution of the
document as well as the agents authority; no objections were
made to the defendants evidence in refutation and no
exceptions taken; and the matter is not mentioned in the
decision of the trial court.

"The object of the rule is to relieve a party of the trouble and

expense of proving in the first instance an alleged fact, the
existence or nonexistence of which is necessarily within the
knowledge of the adverse party, and of the necessity (to his
opponents case) of establishing which such adverse party is
notified by his opponents pleading. (Nery Lim-Chingco v.
Terariray, 5 Phil., at p. 124.)

"The plaintiff may, of course, waive the rule and that is what he
must be considered to have done in the present case by
introducing evidence as to the execution of the document and
failing to object to the defendants evidence in refutation; all this
evidence is now competent and the case must be decided
thereupon. . . .. Nothing of what has here been said is in conflict
with former decisions of this court; it will be found upon
examination that in all cases where the applicability of the rule
has been sustained the party invoking it has relied on it in the
court below and conducted his case accordingly." 7

In the case at bar, the parties acted in complete disregard of or

wholly overlooked the rule above-quoted. Hodges had neither
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
G.R. No. L-32547 May 9, 1978
CONCHITA CORTEZ, ELENA CORTEZ, ROSENDO CORTEZ,
JUDINA CORTEZ and FERNANDO CORTEZ,petitioners,
vs.
HON. COURT OF APPEALS, HON. JUDGE FELIX R.
DOMINGO of Branch XV, Court of First Instance of Manila,
THE SHERIFF, City of Manila, SPECIAL SHERIFF
REYNALDO JAVIER, KUY GUAM KAY, LTD. and MACARIO
SUPAN Y MERCADO, respondents.
AQUINO, J:
This case is about the propriety of the service of a decision of
the Court of Appeals upon appellants' lawyer, who that he had
ceased to be their counsel but who was not authorized to
withdraw from the case.
The question is whether, after the had been remanded to the
trial court and after a writ of execution had been issued, the
Court of Appeals could still set aside that decision on the theory
that it did not become final because it had not been properly
served upon the appellants.
1. On August 12, 1960, Judge E. Soriano of the Court of First
Instance of Manila rendered a decision ordering defendants Kuy
Guam Kay, Ltd. and Macario Supan to pay solidarily the sum of
four thousand pesos as damages to the plaintiffs, the heirs of
Severino Cortez (Civil Case No. 34092). The court found that,
due to the driver's negligence, a truck owned by Kuy Guam Kay,
Ltd. and driven by Macario Supan on August 20, 1957, hit and
killed Severino Cortez in Misericordia Street, Sta. Cruz, Manila.
2. Defendants Kuy Guam Kay, Ltd. and Supan appealed to the
Court of Appeals (CA-G.R. No. 28400-R). During the pendency
of that appeal Judge Luis B. Reyes of the Court of First Instance
of Manila in his decision dated June 12, 1961 in Case No.
41549 acquitted Supan of homicide through reckless
imprudence.
3. Because of that acquittal Kuy Guam Kay, Ltd. and Supan filed
petition in the Court of Appeals dated July 14, 1961 and March
26, 1966 to re-open Civil Case No. 34092 so that the judgment
of acquittal could be presented in evidence. The latter petition
was denied on June 15, 1966.
4. On November 17, 1969 the Court of Appeals rendered a
decision the judgment of the lower court in Civil Case No. 34092
with the modification that the amount of damages was increased
to P12,000. A copy of that decision was served on November
21, 1969 on Atty. Joaquin C. Yuseco, the defendants-appellants'
counsel of record. However, Atty. Yuseco returned that copy and
informed the Court by letter that he had ceased to be the lawyer
for defendants-appellants Supan and Kuy Guam Kay, Ltd. The
Court of Appeals in its resolution of January 13, 1970 noted
Yuseco's letter and made the observation that Yuseco had "not
filed any formal motion for the withdrawal of his appearance" in
that case. The Court of Appeals then sent copies of the decision
to the defendant-appellants themselves by registered mail but
the copies were not delivered because they were unclaimed.
5. Thereafter, there was an entry of judgment indicating that the
decision of the Court of Appeals became final and executory on
December 8, 1969. The record was remanded and was received
in the lower court on March 25, 1970. Notices to that effect were
sent to Attys. Pacifica Garcia and Yuseco, the parties' counsels
of record.
6. On May 30, 1970 a writ of execution was issued by the lower
court. The Sheriff levied upon five freight trucks and an adding
machine owned by Kuy Guam Kay, Ltd. He scheduled the
auction sale on June 26, 1970. Instead of guarding the trucks
and adding machine, the sheriff allowed the manager of the firm
to have custody thereof so that they could be used in the firms
business. On June 26, two trucks and the adding machine were
turned over to the plaintiffs. The other three trucks were
sequestered away by the manager of defendant firm.
7. On June 23, 1970 defendant firm, through a new lawyer, filed
in the Court of Appeals a motion for reconsideration and
suspension of execution. It alleged that there was no valid
service of the decision upon it; that the decision is contrary to
the ruling in Corpus vs. Paje, L-26737, July 31, 1969, 28 SCRA
1062 (that the acquittal of the accused of the crime of homicide
through reckless imprudence is a bar to the civil liability), and
that the increase of the damages from P4,000 to P12,000 was
unwarranted since the plaintiffs did not appeal
8. The Court of Appeals in its resolution of July 1, 1970 set aside
the entry of judgment, ordered the lower court to elevate the
record of the case and required plaintiffs Cortez to comment on
the motion for reconsideration. The a opposed the motion. The
record was re-elevated to the Court of Appeals.
9. On August 18, 1970 the Court of Appeals issued a resolution
setting aside its decision of November 17, 1969 and damaging
the complaint on the basis of the said ruling in Corpus vs.
Paje, supra. Plaintiffs' motion for the reconsideration of that
decision was denied.
10. On September 21, 1970, the plaintiffs filed the petition for
certiorari the Court of Kuy Guam Kay, Ltd. (which had been
succeeded by Seven-O-Seven Trucking Co., Inc.) and Macario
Supan (who allegedly died in 1962, pp. 150 and 164 of Rollo).
The petition is really an appeal from the resolution of August 18,
1970. After the petitioners had posted a bond in the sum of
P500, this Court issued a writ of preliminary injunction dated
September 30, 1970 to restrain the enforcement of that
resolution. Because of that injunction, the petitioners retained
the possession of the adding machine and the two trucks (p.
203, Rollo).
The petition is meritorious. We hold that the Court of Appeals
had no jurisdiction to set aside on August 18, 1970 its decision
of November 17, 1969 which had become final and was in the
process of being executed in the lower court to which the record
was remanded after entry of judgment had been made in the
Court of Appeals.
The 1969 decision became final and executory as to defendant-
appellant Kuy Guam Kay, Ltd. because its lawyer of record, Atty.
Yuseco, was duly served with a copy of that decision. It is true
that Atty. Yuseco returned that copy to the Court with the note
that he was no longer appellants' counsel but that return did not
nullify the effectiveness of the service upon him since he did not
retire from the case with his client's consent or with the Court's
authorization (Sec. 2, Rule 13 and Sec. 26, Rule 138, Rules of
Court; Don Lino Gutierrez & Sons, Inc. vs. Court of Appeals and
Alvendia, L-39124, November 15, 1974, 61 SCRA 87, 91;
Magpayo vs. Court of Appeals and People, L-35966, November
19, 1974, 61 SCRA 115; Baquiran vs. Court of Appeals, 112
Phil. 764; Guanzon vs. Aragon, 107 Phil. 315, 320).
When a party is represented by an attorney, service of orders
and notices must be made upon the latter, and notice to the
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
client and not to his lawyer of record is not a notice in law
(Chairman vs. Tancinco, 90 Phil. 862).
Thus, it was held that, unless the procedure prescribed in
section 26 of Rule 138 is complied with, the attorney of record is
regarded as the counsel who should be served with copies of
the judgments, orders and pleadings and who should be held
responsible for the conduct of the case (Fojas vs. Navarro, L-
26365, April 30, 1970, 32 SCRA 476, 485).
"In order that there may be substitution of attorneys in a given
case, there must be (1) written application for substitution; (2) a
written consent of the client, and (3) a written consent of the
attorney to be substituted. And in case the consent of the
attorney to be substituted cannot be obtained, there must at
least be proof that notice of the motion for substitution has been
served upon him in the manner prescribed by our rules." Where
the procedure for substitution of attorney is not followed, the
attorney who appears to be on record before the filing of the
application for substitution should be regarded as the attorney
entitled to be served with all notices and pleadings and the client
is answerable for the shortcomings of this counsel of record.
(Ramos vs. Potenciano, 118 Phil. 1435).
The counsel of record is obligated to protect his clients interest
until he is released from his professional relationship with his
client. For its part, the court could recognize no other
representation on behalf of the client except such counsel of
record until a formal substitution of attorney is effected. (Wack
Wack Golf and Country Club, Inc. vs. Court of Appeals, 106 Phil.
501, 504).
It is noteworthy that in the instant case even after Atty. Yuseco
had returned to the Court the copy of the decision served upon
him, the Appellate Court and the lower court continued to serve
copies of orders and resolutions upon him as defendants'
counsel of record without any objection on his part. He was
responsible for the conduct of the case since he had not been
properly relieved as counsel of record of the appellants (See U.
S. vs. Borromeo, 20 Phil. 189; Olivares and Colegio de San
Jose vs. Leola, 97 Phil. 263, 257).
WHEREFORE, the resolution of the Court of Appeals dated
August 18, 1970 is reversed and set aside with costs against
respondent firm. SO ORDERED.
G.R. No. L-39958 May 11, 1978
JESUS D. JUREIDINI, petitioner,
vs.
THE COURT OF APPEALS and NAZARIO CLARENCE
JUREIDINI, represented by his mother LUZ
RODRIGUEZ, respondents.
MAKASIAR, J.:
Within the extended period for petitioner to file his brief in the
above-entitled case, private respondent, thru his counsel, Atty.
Luisito Villanueva, simultaneously filed before this Court, on
August 5, 1976, an amicable compromise agreement and an
appearance, both dated August 2, 1976, furnishing a copy
thereof to each of the counsel of record of petitioner, and to
Attys. Estanislao A. Fernandez, Arroyo, Acsay, Barin and Ortile
and Sisenando Villaluz Law Office, Suit 804 JMT Bldg., Ayala
Avenue, Makati, Metro Manila counsel for private respondent
(pp. 381, 383-385, rec.). The amicable compromise agreement
which was signed by Nazario Clarence Jureidini, private
respondent, assisted by his counsel, Luisito S. Villanueva, and
by Jesus D. Jureidini, petitioner, assisted by his counsel,
Conrado V. Sanchez and Felipe G. Tac-an, and verified under
oath before Hon. Melecio A. Genato, Presiding Judge, Branch 1,
Court of First Instance of Misamis Occidental at Oroquieta City,
runs as follows:
AMICABLE COMPROMISE AGREEMENT
COME NOW the parties, assisted by their respective
counsels, and to this Honorable Court, respectfully submit
this AMICABLE COMPROMISE AGREEMENT to be made
as basis for the Decision in the above-entitled case, to wit:
1. That private respondent Nazario Clarence Jureidini is
now of legal age and is not suffering from any incapacity to
enter into a contract, and that he has entered into this
agreement in his own personal capacity,
2. That the parties have agreed to settle and terminate this
case No. G.R. No. L-39958 before this Honorable Court,
including the case under CA-G.R. No. 40441-R, Court of
Appeals, and Civil Case No. OZ (118), Court of First
Instance, Branch II, Misamis Occidental;
3. That for and in consideration of this amicable
compromise agreement, the parties have agreed that
petitioner Jesus D. Jureidini shall pay, as in fact he has
already paid to private respondent Nazario Clarence
Jureidini the amount of ONE HUNDRED THOUSAND
PESOS (P100,000.00), Philippine Currency;
4. That private respondent Nazario Clarence Jureidini does
hereby acknowledge receipt, to his entire satisfaction, of
the aforesaid sum of ONE HUNDRED THOUSAND PESOS
(P100,000.00), Philippine Currency, from petitioner;
5. That by virtue of the agreement, private respondent
Nazario Clarence Jureidini does hereby renounce,
repudiate, waive and quitclaim, now and moreover, in favor
of petitioner Jesus D. Jureidini whatever rights, interests,
claims, title, and participations he has in the estate, real
personal and/or whatever nature, left by the deceased
Nazario S. Jureidini;
6. The parties do hereby agree to waive, relinquish and
abandon, whatever claims and counterclaims they have
against each other in the aforesaid cases.
WHEREFORE, it is respectively prayed that judgment be
rendered in accordance with this Amicable Compromise
Agreement, without costs.
At Oroquieta City (for Manila), August 2, 1976.
(SGD) NAZARIO-CLARENCE JUREIDINI Private
Respondent Plaridel. Misamis Occidental
(SGD) JESUS D. JUREIDINI Petitioner Ozamis City
WITH OUR ASSISTANCE
(SGD) LUISITO S. VILLANUEVA
Counsel for Private Respondent
Calamba, Misamis Occidental
PTRNo. 3395909
January 2, 1976
Calamba, Mis. Occ.
TAN No. 2638380-2
CONRADO V. SANCHEZ
and
FELIPE G. TAC-AN
Counsel for Petitioner
By:
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
(SGD) FELIPE G, TAC-AN
Oroquieta City
PTR No. 7791769 T-
Jan 13/76
Oroquieta City
TAN No. 1556-436-2
Acting on the aforequoted compromise agreement, Attys.
Estanislao A. Fernandez, Arroyo, Acsay, Barin and Ortile and
Sisenando Villaluz Law Office, filed with this Court on August 19,
1976, a manifestation and motion stating, among other things:
(a) that the appearance of Atty. Luisito S. Villanueva as counsel
for respondent Nazario Clarence Jureidini is without their
knowledge and consent; and (b) that they have no knowledge
intervention or inkling of the amicable settlement executed by
and between the petitioner and aforesaid respondent, with
prayer that they be given thirty (30) days from August 19, 1976
within which to file the necessary comment, pleading or motion
with respect to said amicable settlement, and pending the filing
of such comment, any action on the agreement be held in
abeyance.
The Court, per Its resolution of September 1, 1976 required: (1)
the movants to furnish Atty. Villanueva with a copy of said
manifestation and motion and to submit to this Court proof of
such service, both within five (5) days from notice thereof; and
(2) Atty. Villanueva to comment thereon within ten (10) days
from receipt of said copy.
On October 5, 1976, Atty. Luisito S. Villanueva filed his comment
to manifestation and motion, stating among other things
2. That the private respondent Nazario Clarence Jureidini
sometime on August 2, 1976, engaged the legal services
of the undersigned for the purpose of drafting, preparing
and participating in the execution of the amicable
settlement which said private respondent and the
petitioner had already arrived at and concluded, as a
matter of fact, the monetary consideration mentioned in
the Amicable Compromise Agreement had already been
paid prior to August 2, 1976, par. 3, of the Amicable
Compromise Agreement.
3. That the undersigned had inquired from the private
respondent as to whether his previous counsel or
counsels has knowledge of the said settlement, and the
latter informed the former that he has not engaged and
contracted the services of any counsel at any time,
however, he declared that his mother did, but their legal
services were already fully compensated, and that he
further declared that he wants and desires to engage a
counsel of his own choice;
4. That having known the private respondent Nazario
Clarence Jureidini to be of legal age and that he was not
suffering from any incapacity to enter into a contarct, and
further knowing that the contract he will enter into is not
contrary to law, morals or public policy, the undersigned
accepted the request of private respondent to be his
counsel in the execution of the said Amicable
Compromise Agreement and its consequent approval by
this Honorable Court;
5. That consequently, on the same date of August 2,
1976, when the Amicable Compromise Agreement was
entered into by the parties in the City of Oroquieta, the
undersigned formally filed his appearance with this
Honorable Court, with the consent and authority of the
private respondent as may be shown therein. ...
In reply to the foregoing comment of Atty. Luisito S. Villanueva,
Attys. Estanislao Fernandez, Arroyo, Acsay, Barin and Ortile
filed on November 4, 1976 a motion to hold in abeyance
approval of the compromise agreement, stating among other
things that the compromise, agreement "is not only immoral and
entered (into) in bad faith by petitioner and private respondent
but also patently unconscionable, inequitous and an unjust.
action to the prejudice of all the lawyers who had rendered legal
services since 26 March 1976 and that even assuming Nazario
Clarence Jureidini did not enter into any contract with the
attorneys of record, he (,cannot disregard the legal services
rendered in his behalf and for which he has wholly benefited,"
and praying further that a be appointed to receive the evidence
for attorney's fees and to approve. the same as charging lien on
the Testate Estate of Nazario Jureidini.
Considering the reply of Atty. Estanislao Fernandez, Arroyo,
Acsay, Barin and Ortile to the comment of Atty. Luisito S.
Villanueva to the former's manifestation and motion dated
August 19, 1976, this Court in its Resolution dated November
10, 1976, required private respondent Nazario Clarence
Jureidini at Plaridel, Misamis Occidental was returned to this
Court with the information that addressee is no longer residing
at Plaridel, Misamis Occidental. Accordingly this Court, in a
resolution dated January 26, 1977, resolved;: (a) to advise Atty.
Estanislao Fernandez, et al. that The aforesaid respondent no
longer residing at his last known address; and (b) to require
aforesaid counsel to inform this Court within five (5,) days from
notice, of the present address of aforesaid respondent Nazario
Clarence Jureidini. Complying with the immediately preceding
resolution, Atty. Estanislao Fernandez, et al. informed this Court
that the present address of private respondent Nazario Clarence
Jureidini is as follows:
Nazario Clarence Jureidini
c/o Luz Rodriguez
No. 339 Younger Street
Balut, Tondo, Manila
Acting on the compliance by counsel for respondent Nazario
Clarence Jureidini aforesaid, this Court resolved on February
28, 1977, to send to respondent at the above given address, the
resolution of this Court dated November 10, 1976 requiring him
to file rejoinder to the reply of Atty. Estanislao Fernandez, et al.
For failure of private respondent Nazario Clarence Jureidini to
file a rejoinder to the reply of Atty. Estanislao Fernandez, et al. to
the comment of Atty. Luisito S. Villanueva to the former's
manifestation and motion dated August 19, 1976, within the
period which expired on March 19, 1976, the Court resolved on
May 10, 1977 to require aforesaid respondent; (a) to show
cause why he should not be held in contempt for such failure;
and (b) to comply with the resolution of November 10, 1976
requiring said rejoinder, both within ten (10) days from notice
thereof.
For willful disregard of the resolution of this Court of May 20,
1977 which required private respondent Nazario Clarence
Jureidini to show cause why he should not be held in contempt
of court for having failed to file a rejoinder to the reply dated
November 3, 1976 of Attys. Estanislao Fernandez, Arroyo,
Acsay, Barin and Ortile and to comply with the resolution of
November 10, 1976 requiring said rejoinder both within the
period which expired on June 9, 1977, the Court adjudged said
respondent Jureidini guilty of contempt of court and ordered cell
of the National Bureau of Investigation until he shall have
complied with this Court's resolutions. Forthwith, this Court
issued on the same day an "Order of Arrest and Commitment",
commanding the Director, National Bureau of Investigation, Taft
Avenue Manila, "to arrest Nazario Clarence Jureidini who is said
to be found at No. 339 Younger Street, Balut, Tondo, Manila (c/o
Luz Rodriguez) ... and to commit him to the detention cell of the
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
NBI where he shall be detained and safely kept until he has fully The compromise agreement hereinabove reproduced is not
complied with the resolutions of this Court... . contrary to law, morals, public order or public policy, and
provides for the full satisfaction of respondent's claim against
On January 12, 1978, Sr. NBI Agent Jesus S. Caragan of the the petitioner.
National Bureau of Investigation returned to this Court the order
of arrest and commitment, UNSERVED, with the information WHEREFORE, THE AMICABLE COMPROMISE AGREEMENT
that subject cannot be located at the aforementioned address DATED AUGUST 12, 1976 IS HEREBY APPROVED, AND THE
and his present whereabouts are not known. PARTIES ARE HEREBY DIRECTED TO ABIDE BY AND
COMPLY WITH THE TERMS THEREOF.
While this Court, in the meantime, was awaiting compliance by
private respondent Nazario Clarence Jureidini of the resolution THIS CASE IS HEREBY CLOSED AND TERMINATED. NO
of November 10, 1976, one Manuel T. Cortez of Ozamis City COSTS.
filed before this Court a petition for intervention praying, inter-
alia, that he be allowed to intervene and file his claim against
the private respondent for all his financial aid extended to him
during the pendency and prosecution of his claim in the trial
court and in the Court of Appeals againsts the Testate Estate of
Nazario Jureidini; and that the approval of petitioner's
compromise agreement entered into with private respondent
Nazario Clarence Jureidini, on March 7, 1974. Among other
things, said memorandum of agreement provides that to
reimburse Cortez for the expenses incurred to prosecute and
defend the case including the professional fee of her lawyer
together with the interest charged thereon, the parties (petitioner
and Luz Rodriguez) agreed that in the event this case is finally
terminated and won, Luz Rodriguez would pay Cortez: [G.R. No. 129718. August 17, 1998]

ONE-HALF (1/2) PORTION OF THE TOTAL
SHARE OF THE FIRST PARTY OF THE
MONIES, PROPERTIES AND ALL OTHER
KINDS OR NATURE WHATSOEVER
ADJUDICATED TO THE FIRST PARTY,
including damages awarded and interests
due thereon as based and computed in the
final promulgation of the decision in said Civil
Case mentioned herein.
The question that now arise are:
1. May the rights of lawyers to the fees due them for vices
rendered their client be invoked as a ground for in abeyance the
approval of a compromise agreement entered into by the client
and his adversary?
2. May a petition for intervention filed by an alleged financier of
one of the parties litigants in a case be en by this Court at this
stage of the proceedings, and if so, may the pendency thereof
be invoked as a ground for holding in abeyance a compromise
agreement entered into by and between the parties litigants?
WE answer these questions in the negative.
1. The matter of attorney's fees, if any, due Attys. Estanislao
Fernandez, Arroyo, Acsay, Barin and Ortile from private
respondent Nazario Clarence Jureidini cannot have a standing
higher than the rights of the clients or the parties themselves.
Hence, lawyers' rights to fees from their clients may not be
invoked by the lawyers themselves as a ground for disapproving
or otherwise. holding in abeyance the approval of the
compromise agreement, which is otherwise not contrary to law,
morals-, public order or public policy. The lawyers concerned
can enforce their rights in the proper court in an appropriate
proceeding in accordance with the Rules of Court, but said
rights may not be used to prevent the approval of the
compromise agreement (Jesalva, et al. vs. Hon. Bautista and
Premier Productions, Inc., 105 Phil. 348, 352).
2. With respect to the petition for intervention, We deny the
same, not only because the claim of the intervenor can be
properly ventilated before the proper court in a separate
proceeding, but also because it will unduly delay and prejudice
the adjudication of the rights of the parties litigants in the case at
bar.
SANTO TOMAS UNIVERSITY HOSPITAL, petitioner
vs. CESAR ANTONIO Y. SURLA and EVANGELINE
SURLA, respondents.
DECISION
VITUG, J.:
Can a compulsory counterclaim pleaded in an Answer be
dismissed on the ground of a failure to accompany it with a
certificate of non-forum shopping? This question is the core
issue presented for resolution in the instant petition.
First, a factual background.
On 26 December 1995, respondent spouses filed a
complaint for damages against petitioner Santo Tomas
University Hospital with the Regional Trial Court of Quezon City
predicated on an allegation by the spouses that their son,
Emmanuel Cesar Surla, while confined at the said hospital for
having been born prematurely, had accidentally fallen from his
incubator on 16 April 1995 possibly causing serious harm on the
child. The case was raffled and assigned to Branch 226 of the
Regional Trial Court of Quezon City, presided over by the Hon.
Leah S. Domingo-Regala, and there docketed Civil Case No. Q-
95-25977.
On 28 February 1996, petitioner hospital filed its Answer
with Compulsory Counterclaim asserting that respondents still
owed to it the amount of P82,632.10 representing hospital bills
for Emmanuels confinement at the hospital and making a claim
for moral and exemplary damages, plus attorneys fees, by
reason of the supposed unfounded and malicious suit filed
against it.
On 21 March 1996, petitioner received a copy of
respondents Reply to Counterclaim, dated 12 March 1996, that
sought, inter alia, the dismissal of petitioners counterclaim for its
non-compliance with Supreme Court Administrative Circular No.
04-94 requiring that a complaint and other initiatory pleadings,
such as a counterclaim, cross-claim, third (fourt, etc.) party
complaint, be accompanied with a certificate of non-forum
shopping.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
In its Rejoinder to respondents Reply to Counterclaim,
petitioner contended that the subject circular should be held to
refer only to a permissive counterclaim, an initiatory pleading not
arising out of, nor necessarily connected with, the subject matter
of the plaintiffs claim but not to a compulsory counterclaim
spawned by the filing of a complaint and so intertwined
therewith and logically related thereto that it verily could not
stand for independent adjudication. Petitioner concluded that,
since its counterclaim was compulsory in nature, the subject
circular did not perforce apply to it.[1]
In its Order of 22 March 1996, the trial court dismissed
petitioners counterclaim,it held:
Administrative Circular No. 04-94 provides; among others:
The complaint and other initiatory pleadings referred to and
subject of this Circular are the original civil complaint,
counterclaim, cross-claim, third (fourth, etc) party complaint, or
complaint-in-intervention, petition or application wherein a party
asserts his claim on (sic) relief.
It will be noted that the counterclaim does not distinguish
whether the same should be permissive or compulsory, hence
this Court finds that the counterclaim referred to in said Circular
covers both kinds.
WHEREFORE, the counterclaim of defendant is hereby
DISMISSED. Let the pre-trial of this case be set on May 14,
1996 at 2:00 oclock in the afternoon xxx[2]
On 16 April 1996, petitioner filed before the same court an
Omnibus Motion seeking a clarification of the courts Order of 14
March 1996 denying respondents Reply to Counterclaim and
reconsideration of the 22nd March 1996 Order dismissing the
compulsory counterclaim.[3] On 22 April 1996, petitioner received
a copy of the courts Order, dated 16 April 1996, which
pertinently read:
WHEREFORE, the Order dated March 14, 1996 is hereby
clarified as follows:
xxxxxxxxx
The Reply to counterclaim filed by counsel for plaintiffs is hereby
NOTED.
SO ORDERED.
"The Motion for Reconsideration of this Courts Order dated
March 22, 1996 is hereby DENIED. The pre-trial conference set
on May 14, 1996 will go on as scheduled.[4]
Petitioner forthwith elevated the matter to the Court of Appeals
by way of a special civil action for certiorari under Rule 65,
Revised Rules of Court, asseverating grave abuse of discretion
by public respondent in dismissing the compulsory counterclaim
and in espousing the view that Administrative Circular No. 04-94
should apply even to compulsory counterclaims.
The Court of Appeals, in its Decision promulgated on 12
March 1997, dismissed the petition for certiorari; it opined:
x x x the Supreme Court circular aforequoted requires without
equivocation that to the original civil complaint, counterclaim,
cross-claim, third (fourth,etc.) party complainant, or complaint-
in-intervention, petition, or application wherein a party asserts
his claim for relief to be filed in all courts and agencies other
than the Supreme Court and the Court of Appeals must be
annexed and simultaneously filed therewith the required
certification under oath to avoid forum shopping or multiple filing
of petitions and complaints. Non-compliance therewith is a
cause for the dismissal of the complainant, petition, application
or other initiatory pleading. Included in such initiatory pleading is
the defendants counterclaim, permissive or compulsory.
A counterclaim partakes of the nature of a complaint and/or a
cause of action against the plaintiff in a case x x x, only this time
it is the original defendant who becomes the plaintiff. It stands
on the same footing and is tested by the same rules as if it were
an independent action.[5]
In its present recourse, petitioner contends that
The Court of Appeals (has) committed serious, evident and
palpable error in ruling that:
5.1 THE SPECIAL CIVIL ACTION OF CERTIORARI UNDER
RULE 65 OF THE REVISED RULES OF COURT IS
UNAVAILING. THE DISMISSAL OF THE COMPULSORY
COUNTERCLAIM BEING A FINAL ORDER, THE PETITIONER
SHOULD HAVE TAKEN AN APPEAL THEREFROM; AND
5.2 ADMINISTRATIVE CIRCULAR NO. 04-94 OF
THIS HONORABLE COURT LIKEWISE APPLIES TO
BOTH KINDS OF COUNTERCLAIMS, PERMISSIVE AND
COMPULSORY.[6]
The petition is partly meritorious.
The appellate court ruled that the dismissal of the
counterclaim, being a final order, petitioners remedy was to
appeal therefrom and, such appeal being then available, the
special civil action for certiorari had been improperly filed.
The concept of a final judgment or order, distinguished
form an interlocutory issuance, is that the former decisively puts
to a close, or disposes of a case or a disputed issue leaving
nothing else to be done by the court in respect thereto. Once
that judgment or order is rendered, the adjudicative task of the
court is likewise ended on the particular matter involved. [7] An
order is interlocutory, upon the other hand, if its effects would
only be provisional in character and would still leave substantial
proceedings to be further had by the issuing court in order to put
the controversy to rest.[8]
The order of the trial court dismissing petitioners
counterclaim was a final order since the dismissal, although
based on a technicality, would require nothing else to be done
by the court with respect to the specific subject except only to
await the possible filing during the reglementary period of a
motion for reconsideration or the taking of an appeal therefrom.
As a rule, errors of judgment, as well as of procedure,
neither relating to the jurisdiction of the court nor involving grave
abuse of discretion, are not reviewable by the extraordinary
remedy of certiorari.[9] As long as a court acts within its
jurisdiction and does not gravely abuse its discretion in the
exercise thereof, any supposed error committed by it will
amount to nothing more than an error of judgment reviewable by
a timely appeal and not assailable by a special civil action
for certiorari.[10] This rule however, is not a rigid and inflexible
technicality.This Court has not too infrequently given due course
to a petition for certiorari, even when the proper remedy would
have been an appeal, where valid and compelling
considerations could warrant such a recourse. [11] Certiorari has
been deemed to be justified, for instance, in order to prevent
irreparable damage and injury to a party where the trial judge
has capriciously and whimsically exercised his judgment, or
where an ordinary appeal would simply be inadequate to relieve
a party from the injurious effects of the judgment complained of.
[12]
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
In the case at bar, an appeal from the dismissal of the predicated on the applicability of the need for a certification
counterclaim, although not totally unavailable, could have well against forum shopping, obviously does not include a claim
been ineffective, if not futile, as far as petitioner is concerned which cannot be independently set up.
since no single piece of evidence has yet been presented by it,
the opportunity having been foreclosed by the trial court, on the Petitioner, nevertheless, is entitled to a mere
dismissed counterclaim which could form part of the records to partial relief. The so called counterclaim of petitioner really
be reviewed by the appellate court. The object of procedural law consists of two segregative parts: (1) for unpaid hospital bills of
is not to cause an undue protraction of the litigation, but to respondents son, Emmanuel Surla, in the total amount
facilitate the adjudication of conflicting claims and to serve, of P82,632.10; and (2) for damages, moral and exemplary, plus
rather than to defeat, the ends of justice.[13] attorneys fees by reason of the alleged malicious and
unfounded suit filed against it.[16] It is the second, not the first,
claim that the Court here refers to as not being initiatory in
character and thereby not covered by the provisions of
The opinion of this Court on the next issue persuades it to Administrative Circular No. 04-94.
accept, tested by the foregoing disquisition, the instant petition
for its consideration. WHEREFORE, the appealed decision is hereby modified
in that the claim for moral, exemplary damages and attorneys
The pertinent provisions of Administrative Circular No. 04- fees in Civil Case No. Q-95-25977 of petitioner is ordered
94 provide: reinstated. The temporary restraining order priorly issued by this
Court is lifted. No costs.
1 The plaintiff, petitioner, applicant or principal party seeking
relief in the complaint, petition, application or other initiatory SO ORDERED.
pleading shall certify under oath in such original pleading, or in a
sworn certification annexed thereto and simultaneously filed
therewith, to the truth of the following facts and undertakings: (a)
he has not theretofore commenced any other action or
proceeding involving the same issues in the Supreme Court, the
Court of Appeals, or any other tribunal or agency; (b) to the best
of his knowledge, no such action or proceeding is pending in the
Supreme Court, the Court of Appeals, or any other tribunal or
agency; (c) if there is any such action or proceeding which is
either pending or may have been terminated, he must state the
status thereof; and (d) if he should thereafter learn that a similar
action or proceeding has been filed or is pending before the
Supreme Court, the Court of Appeals or any other tribunal or
agency, he undertakes to report that fact within five (5) days
therefrom to the court or agency wherein the original pleading
and sworn certification contemplated here have been filed.

The complaint and other initiatory pleadings referred to and

subject of this Circular are the original civil complaint,
counterclaim, cross-claim third (fourth, etc.) party
complaint or complaint-in-intervention, petition, or
application wherein a party asserts his claim for
relief. (Emphasis supplied)

It bears stressing, once again, that the real office of

Administrative Circular No. 04-94, made effective on 01 April
1994, is to curb the malpractice commonly referred to also as
forum-shopping. It is an act of a party against whom an adverse
judgment has been rendered in one forum of seeking and
possibly getting a favorable opinion in another forum, other than
by appeal or the special civil action of certiorari, or the institution
of two or more actions or proceedings grounded on the same
cause on the supposition tha tone or the other court would make
a favorable disposition.[14] The language of the circular distinctly
suggests that it is primarily intended to cover an initiatory
pleading or an incipient application of a party asserting a claim
for relief.[15]

It should not be too difficult, the foregoing rationale of the

circular aptly taken, to sustain the view that the circular in
question has not, in fact, been contemplated to include a kind of
claim which, by its very nature as being auxiliary to the
proceedings in the suit and as deriving its substantive and
jurisdictional support therefrom, can only be appropriately
pleaded in the answer and not remain outstanding for
independent resolution except by the court where the main case
pends. Prescinding from the foregoing, the provisio in the
second paragraph of Section 5, Rule 8 of the 1997 Rules on
Civil Procedure, i.e., that the violation of the anti-forum shopping
rule shall not be curable by mere amendment x x x but shall be
cause for the dismissal of the case without prejudice, being
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
G.R. No. 117083 October 27, 1995
LAZARO V. KAVINTA, petitioner,
vs.
HON. PRUDENCIO ALTRE CASTILLO, JR., Presiding Judge,
Branch 220, Regional Trial Court, Quezon City, and ANTONIO C.
FRANCO, respondents.
DAVIDE, JR., J.:
The issue in this special civil action for certiorari is whether public
respondent Judge Prudencio Altre Castillo, Jr., has committed grave
abuse of discretion in denying the motion to dismiss the complaint in
Civil Case No. Q-94-20532 on the ground that the certification of
non-forum shopping required under Administrative Circular No. 04-
941 was, nevertheless, subsequently submitted after the filing of the
motion to dismiss.
The antecedent disclosed by the parties in their pleadings are
uncomplicated.
On 11 May 1994, private respondent represented by his attorney-in-
fact, Angeles F. Arroyo, filed with the Regional Trial Court of Quezon
City a complaint against petitioner Lazaro V. Kavinta and others 2 a
complaint for Recovery of Possession and Issuance of Writ of
Demolition. The case was docketed as Civil Case No. Q-94-20532
and was raffled to Branch 220 of said court, which is presided over
by public respondent Judge Castillo.
On 20 June 1994, the petitioner and his codefendants moved to
dismiss the complaint 3 on the ground that "it does not comply with
Administrative Circular No. 04-94 of the Supreme Court which took
effect on April 1, 1994."
On 4 July 1994 private respondent filed, through counsel, an
opposition to the motion to dismiss, 4 to which he attached as Annex
"A" thereof the certification required in Administrative Circular No.
04-94. 5
On 20 July 1994, Judge Castillo issued an order 6 denying the
motion to dismiss in view of the submission of the aforesaid
certification, and directing the defendants to file their answer or
responsive pleading "within the remaining reglementary period in
accordance with the Rules of Court."
On 3 August 1994, Judge Castillo issued an order 7 declaring
petitioner's Reply to the opposition to the motion to dismiss moot
and academic in view of the order of 20 July 1994.
On 24 August 1994, petitioner filed a motion to reconsider his Reply
as a motion for the reconsideration of the order of 20 July 1994. 8
On 2 September 1994, Judge Castillo issued an order 9 denying the
Reply, which was treated as a motion for reconsideration, and
clarifying that
The language of the July 20, 1994 order is very clear and
unambiguous. The fifteen (15) days reglementary period to
plead is reckoned from the date defendants, through
counsel, received the notice denying their motion to dismiss.
Administrative Circular No. 04-94 of this Court issued by the Chief
Justice on 8 February 1994 and which took effect on 1 April 1994
pertinently provides:
Revised Circular No. 28-91, dated February 8, 1994 applies
to and governs the filing of petitions in the Supreme Court
and the Court of Appeals and is intended to prevent the
multiple filing of petitions or complaints involving the same
issues in other tribunals or agencies as a form of forum
shopping.
Complementary thereto and for the same purpose, the
following requirements, in addition to those in pertinent
provisions of the Rules of Court and existing circulars, shall
be strictly complied with in the filing of complaints petitions,
applications or other initiatory pleadings in all courts and
agencies other than the Supreme Court and the Court of
Appeals, and shall be subject to the sanctions provided
hereunder:
1. The plaintiff, petitioner, applicant or principal party seeking
relief in the complaint, petition, application or other initiatory
pleading shall certify under oath in such original pleading, or
in a sworn certification annexed thereto and simultaneously
filed therewith, to the truth of the following facts and
undertakings: (a) he has not theretofore commenced any
other action or proceeding involving the same issues in the
Supreme Court, the Court of Appeals, or any other tribunal
or agency; (b) to the best of his knowledge, no such action
or proceeding is pending in the Supreme Court, the Court of
Appeals or any other tribunal or agency; (c) if there is any
such action or proceeding which is either pending or may
have been terminated, he must state the status thereof; and
(d) if he should thereafter learn that a similar action or
proceeding has been filed or is pending before the Supreme
Court, the Court of Appeals, or any other tribunal or agency,
he undertakes to report that fact within five (5) days
therefrom to the court or agency wherein the original
pleading and sworn certification contemplated herein have
been filed.
The complaint and other initiatory pleadings referred to and
subject of this Circular are the original civil complaint,
counterclaim, cross-claim, third (fourth, etc.) party
complaint, or complaint-in-intervention, petition, or
application wherein a party asserts his claim for relief.
2. Any violation of this Circular shall be a cause for the
dismissal of the complaint, petition, application or other
initiatory pleading, upon motion and after hearing. However,
any clearly wilful and deliberate forum shopping by any party
and his counsel through the filing of multiple complaints or
other initiatory pleadings to obtain favorable action shall be a
ground for summary dismissal thereof and shall constitute
direct contempt of court. Furthermore, the submission of a
false certification or non-compliance with the undertakings
therein, as provided in Paragraph 1 hereof, shall constitute
indirect contempt of court, without prejudice to disciplinary
proceedings against the counsel and the filing of a criminal
action against the guilty party.
In Loyola vs. Court of Appeals, et al., 10 we categorically ruled that
the Circular is mandatory as indicated by the clear language of its
paragraph 2. Nevertheless, substantial compliance thereof is
sufficient. Thus:
Substantial compliance with the Circular is sufficient. This
Circular expanded or broadened the applicability of Circular
No. 28-91 of this Court. In Gabionza vs. Court of
Appeals [G.R. No. 112547, Resolution of 18 July 1994. 234
SCRA 192] this Court held that substantial compliance
therewith is sufficient for:
It is scarcely necessary to add that Circular No. 28-
91 must be so interpreted and applied as to achieve
the purposes projected by the Supreme Court when
it promulgated that Circular. Circular No. 28-91 was
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
designed to serve as an instrument to promote and
facilitate an orderly administration of justice and
should not be interpreted with such absolute
literalness as to subvert its
own ultimate and legitimate objective or the goal of
all rules of procedure which is to achieve
substantial justice as expeditiously as possible.
xxx xxx xxx
The fact that the Circular requires that it be strictly
complied with merely underscores its mandatory
nature in that it cannot be dispensed with or its
requirements altogether disregarded, but it does not
thereby interdict substantial compliance with its
provisions under justifiable circumstances.
In his opposition to the motion to dismiss, private respondent neither
offered any explanation why he failed to comply with the Circular nor
invoked any justifiable circumstance which would relieve him of the
adverse effect of non-compliance. If this Court is to be unbending in
its demand for at least a substantial compliance of the said Circular,
the challenged order must have to be set aside. However, in his
motion to dismiss the instant petition, 11private respondent pointed
out that the filing of the required certification was done with dispatch
by his counsel upon "realization of the existence of said circular." He
thereby admits his unawareness or ignorance of the Circular at the
time he filed his complaint. We are not unmindful of the fact that
Administrative Circular No. 04-94 took effect only on 1 April 1994
and the complaint in Civil Case No.
Q-94-20532 was filed on 11 May 1994. The proximity then of the
filing of the complaint to the date of the effectivity of the Circular may
be pleaded as a justifiable circumstance, and the belated filing of the
certification required thereunder may be deemed a substantial
compliance therewith. We thus rule pro hac vice, but not without a
whit of reluctance, that this special circumstance in this case could
sustain the action of the respondent Judge. This should not be
taken, however, as a precedent. Elsewise stated, the mere
submission of a certification under Administrative Circular No. 04-94
after the filing of a motion to dismiss on the ground of non-
compliance thereof does not ipso facto operate as a substantial
compliance; otherwise the Circular would lose its value or efficacy.
WHEREFORE, the instant petition is DISMISSED. Petitioner is
DIRECTED to file his responsive pleading in Civil Case No. Q-94-
20532 within a period of ten (10) days from notice of this resolution.
Costs against petitioner.
SO ORDERED.
G.R. No. 116910 October 18, 1995
INTERNATIONAL CONTAINER TERMINAL SERVICES, INC.,
ET AL., petitioners,
vs.
COURT OF APPEALS, HON. ANGEL V. COLET, MANILA
PILOTS ASSOCIATION, ET AL., respondents.
FRANCISCO, J.:
Material hereto are the antecedents mostly taken from the
decision of the respondent Court of Appeals in CA-G.R. No. SP
33177, (International Container Terminal Services, Inc., et. al. v.
Hon. Angel V. Colet, et. al.), 1 subject of the present petition for
review, viz:
On February 3, 1988, the Philippine Ports Authority issued
Administrative Order No. 02-88 (A.O. No. 02-88) entitled
"Implementing Guidelines on Open Pilotage Service". A.O. No.
02-88 opened pilotage services in the Philippines to all licensed
and accredited harbor pilots regardless of their non-membership
in existing harbor pilots association. 2
The United Harbor Pilots Association of the Philippines, Inc.
(hereinafter referred to as "United Harbor" for brevity) and
private respondent Manila Pilots Association (hereinafter
referred to as "Manila Pilots") 3 made representations with then
Acting Secretary of Transportation and Communications, Hon.
Rainerio O. Reyes and the Chairman of the Philippine Ports
Authority to set aside the implementation of A.O. No. 02-88
claiming that it violated their exclusive right to provide pilotage
services in the Philippines.
Failing in their efforts to obtain a reconsideration of the said
administrative order, "United Harbor" and private respondent
"Manila Pilots" sought to invalidate A.O. No. 02-88 by filing with
the Regional Trial Court of Manila, a petition for certiorari and
prohibition with prayer for a temporary restraining order against
Secretary Reyes, the Philippine Ports Authority, its General
Manager, Maximo S. Dumlao, Jr. and certain "John Does" (Civil
Case No. 88-44726).
On October 26, 1989, the Regional Trial Court rendered its
decision in Civil Case No. 88-44726 in favor of "United Harbor"
and private respondent "Manila Pilots", the dispositive portion of
which reads:
WHEREFORE, for all of the foregoing, the petition is
hereby granted:
1. Respondents are hereby declared to have acted in
excess of jurisdiction and with grave abuse of discretion
amounting to lack of jurisdiction in approving Resolution
No. 869 and in enacting Administrative Order No. 02-88,
the subject of which is "Implementing Guidelines or (sic)
Open Pilotage Service;
2. Philippine Ports Authority Administrative Order No. 02-
88 is declared null and void;
3. The preliminary injunction issued on September 8,
1989 is made permanent; and
4. Without costs.
SO ORDERED. 4
The above decision was appealed to the Court of Appeals via a
petition for certiorari and prohibition which was dismissed for
lack of jurisdiction, as it raised a purely legal question. 5 The
dismissal was appealed to this court by way of a petition for
review on certiorari which was denied with finality on June 8,
1992. 6 Notwithstanding the finality of the decision recognizing
the exclusive right to pilotage of "United Harbor" and private
respondent "Manila Pilots", petitioner "International Container"
took over the pilotage services at the Manila International Port
area 7 on October 28, 1992 by virtue of a contract it entered into
with the Philippine Ports Authority.
As a consequence, "United Harbor" and private respondent
"Manila Pilots" filed a series of petitions in Civil Case No. 88-
44726 to hold then Philippine Ports Authority General Manager
Rogelio A. Dayan and "International Container" officials and
other persons in contempt of court. The contempt petitions,
however, have not been resolved because the Office of the
Solicitor General elevated to the Supreme Court (docketed as
G.R. 107720) the question of whether or not the lower court still
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
had jurisdiction to take cognizance of the petitions for contempt
in view of the finality of the decision in Civil Case No. 88-44726.
Pending resolution of the contempt petitions, private respondent
"Manila Pilots" filed another case against petitioner
"International Container" before Branch 32 of the Regional Trial
Court of Manila docketed as Civil Case No. 93-66024 for
damages suffered by private respondent "Manila Pilots"
between April 19, 1993 and April 29, 1993 as a result of
petitioner's usurpation of its sole and exclusive exercise of
harbor pilotage in the South and North Harbors of Manila and
Limay, Bataan, except the Manila International Port area. 8
Similarly, aggrieved by the unjust actuations of petitioner
"International Container", and its continuing refusal to relinquish
pilotage services in the Manila International Port area, private
respondent "Manila Pilots" instituted a petition for mandamus,
prohibition with preliminary mandatory injunction and damages
against petitioner "International Container" before Branch 47 of
the Regional Trial Court of Manila docketed as Civil Case No.
66143.
In an Order dated January 20, 1994, the Regional Trial Court in
Civil Case No. 93-66143 issued the writ prayed for, thereby
"restoring and reinstating private respondent "Manila Pilots" to
the exclusive exercise of harbor pilotage in the Manila
International Port (MIP) area and commanding petitioner
"International Container" to cease and desist from usurping or
exercising the right to compulsory pilotage in the said Manila
International Port (MIP) area." 9 Petitioner "International
Container" assailed this order of the lower court by filing a
petition for certiorari with respondent court contending, among
others, that the filing of Civil Case No. 93-66143, pending:
1.) Contempt petitions incidents of Civil Case No.
88-44726 The contempt petitions filed by "United
Harbor" and private respondent "Manila Pilots" against
petitioner "International Container" and Philippine Ports
Authority for defying the final judgment in Civil Case No.
88-44726;
2.) G.R. No. 107720 The case filed by the Office of the
Solicitor General with the Supreme Court raising the
question of jurisdiction of the lower court to take
cognizance of the contempt petitions in view of the finality
of the decision in Civil Case No. 88-44726; and
3.) Civil Case No. 93-66024 The action for damages
filed by private respondent "Manila Pilots" against
"International Container" to recover unearned income from
the exercise of harbor pilotage in ports other than the
Manila International Port (MIP) area from April 19, 1993 to
April 29, 1993 was violative of the prohibition against
forum shopping. 10 Respondent court found no merit in this
contention, and affirmed the decision of the lower court.
Hence, the main inquiry posed before us: On the basis of the
foregoing, is there forum shopping?
Petitioner "International Container" contends that there is forum
shopping because "[t]he issue on (sic) the contempt petition
before Judge Flojo 11 and before this Court and (sic) in G.R. No.
107720 is the very same issue involved in the case
for mandamus and prohibition (Civil Case No. 93-66143)". 12 It
further contends that private respondent "Manila Pilots" is guilty
of forum shopping because "[a]t the time the contempt petitions
were pending . . . and while these petitions were being
challenged . . . (G.R. No. 107720), another case . . . was
pending before RTC Manila, docketed as Civil Case No.
93-66024 . . ." 13
We are not persuaded.
The assailed decision is in accordance with the established rule
that for forum shopping to exist, both actions must involve the
same transactions, same essential facts and
circumstances. 14 Furthermore, the actions must also raise
identical causes of action, subject matter, and issues. 15 We find
no such similarity in the actions involved. Thus, as correctly
observed by the respondent court:
The facts which gave rise to the contempt petition is
directed against what was perceived to be violative of
the permanent injunction issued by Judge Flojo not to
implement the open pilotage policy as provided for
under PPA Administrative Order No. 02-88, . . . .
Upon the other hand the complaint in Civil Case No.
93-68143 (sic) is anchored on the alleged usurpation
of the right of respondents on (sic) the sole and
exclusive exercise of Harbor Pilotage only in the MIP
area, from October 29, 1992 up to the present and
the corresponding claim for damages.16 (Emphasis
provided)
Furthermore, G.R. No. 107720 was filed with the Supreme Court
solely to question the jurisdiction of the lower court to take
cognizance of the contempt petitions filed in Civil Case No. 88-
44726, and the issue raised therein has no bearing on that
raised in Civil Case No. 93-66143.
On the other hand, Civil Case No. 93-66024 sought
the recovery of damages in the form of unearned income as a
result of petitioner's usurpation of the right to pilotage of private
respondent "Manila Pilots" in the South and North Harbors of
Manila and Limay, Bataan except Manila International Port area
from April 19, 1993 to April 29, 1993while Civil Case No. 93-
66143 was brought to enjoin petitioner from further usurping the
same right of private respondent "Manila Pilots" in the Manila
International Port area only from October 28, 1992 up to the
present. Clearly, these two cases do not have the same facts
nor do they raise identical causes of action.
Moreover, "[t]here is forum shopping whenever, as a result of an
adverse opinion in one forum, a party seeks a favorable opinion
(other than by appeal or certiorari) in another". 17 Therefore, a
party to a case resorts to forum shopping because "[b]y filing
another petition involving the same essential facts and
circumstances, . . ., respondents approached two different fora
in order to increase their chances of obtaining a favorable
decision or action". 18 It cannot be said that private respondent
"Manila Pilots" sought to increase its chances of obtaining a
favorable decision or action as a result of an adverse opinion in
one forum, inasmuch as no unfavorable decision had ever been
rendered against private respondent "Manila Pilots" in any of the
cases brought before the courts below. On the contrary, private
respondent "Manila Pilots" was one of the prevailing parties in
Civil Case No. 88-44726 which established with finality its
exclusive right together with "United Harbor" to provide pilotage
services in the Philippines even prior to the institution of the
other actions (G.R.107720, Civil Case No. 93-66024 and Civil
Case No. 93-66143.)
ACCORDINGLY, finding no reversible errors, the decision
appealed from is hereby AFFIRMED and this petition is
DENIED.
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
[G.R. No. 127393. December 4, 1998]
SPOUSES VALENTINO ORTIZ AND CAMILLA MILAN
ORTIZ, petitioners, vs. COURT OF APPEALS and SPOUSES
FRANCISCO AND BERNARDINA RODRIGUEZ, respondents.
DECISION
QUISUMBING, J.:
Petitioners seeks a review of the decision[1] of the Court of
Appeals in CA- G.R. CV 42238 dated October 18, 1996, and its
resolution[2] dated December 03, 1996, on the motion for
reconsideration, dismissing the case for failure of the petitioners
to comply strictly with the Rules of Court. The appellate court
decreed, thus:
WHEREFORE, for not being sufficient in form and substance,
the instant Petition for Review is hereby DENIED due course
and accordingly DISMISSED outright.[3]
The factual background of this petition is as follows:
The spouses Francisco and Bernardina Rodriguez, herein
private respondents (hereafter the Rodriguezes), filed an action
for ejectment in the Metropolitan Trial Court (MeTC) of
Paraaque, Branch 77, against Valentin and Camilla Ortiz, herein
petitioners (hereafter the Ortizes), who are lessees of Cristopher
and Angelica Barramedas, on the ground that they are the real
owners of the house and lot or the subject property. MeTC,
Branch 77, awarded the possession of the property in favor of
the Rodriguezes.
The Ortizes appealed the Paraaque MeTC decision to the
RTC of Paraaque, Branch 257. On August 30, 1996, the latter
court found no reversible error in the assailed judgment, and
thus affirmed it in toto. On September 27, 1996, the
Rodriguezes filed the Motion for Issuance of Writ of Execution of
judgment, which was opposed by the herein petitioners on
October 24, 1996.
Upon the Paraaque RTCs denial of the Opposition to
Motion for Issuance of Writ of Execution, the petitioner Ortizes
appealed to the Court of Appeals (CA). The petition was
dismissed on the following grounds: (1) the certification of non-
forum shopping was signed by the counsel and not by the
petitioners themselves, and (2) the copy of the RTC decision is
not duly certified as a true copy as required by Sec. 3 (b), Rule 6
of the Revised Internal Rules of CA. Further, the supposed
duplicate original copy of said decision does not bear the dry
seal of the trial court, but merely stamped Original Signed,
which appears above the name of the judge.
Hence, the petitioners now come before us, and raise the
following grounds in support of the petition:
I The Court of Appeals is clear contravention of the rules of
Court, and the ruling in Gabionza v. Court of Appeals, 234
SCRA 192, Loyola v. Court of Appeals, 245 SCRA 477 and
Kavinta v. Castillo, 249 SCRA 604 gravely erred in dismissing
the Ortizes' petition review, and/or in failing to reconsider such
dismissal.
II. The Court of Appeals gravely erred in failing to rule on the
issue of lack of jurisdiction of the MTC which had decided the
issue of ownership.
III. The Court of Appeals gravely erred in ignoring the issue of
forum shopping raised against the Rodriguezes, and thus
sanctioned a violation of Circular Nos. 28-91 and 04-94.[4]
From the foregoing factual and procedural antecedents,
the main issue for our resolution is:
DID THE RESPONDENT COURT OF APPEALS ERR IN
DISMISSING THE PETITION FOR REVIEW UNDER RULE 41
OF THE REVISED RULES OF COURT AS AMENDED, FOR
FAILURE OF PETITIONERS TO FAITHFULLY COMPLY WITH
THE PROCEDURAL REQUIREMENTS SET FORTH IN SC
CIRCULAR NO. 28-91 AND SC ADMINISTRATIVE
CIRCULARS NO. 3-96?
To resolve the issue, it should be recalled that Revised
Circular No. 28-91[5] provides that the party must certify
under oath that he has not commenced any other action or
proceeding involving the same issues in the Supreme Court, the
Court of Appeals, or different Divisions thereof, or any other
tribunal or agency, and that to the best of his knowledge, no
such action or proceeding is pending in the Supreme Court, the
Court of Appeals, or different Division thereof, or any other
tribunal or agency[6] (Emphasis supplied)
Petitioners admit that their lawyer, Atty. Ma. Filomena
Singh-Paulite, signed the Certification on Non-Forum Shopping.
Allegedly, Atty. Paulite has personal knowledge that the Ortizes
had not commenced any other action or proceeding involving
the same parties and causes of action. Petitioners now assert
that their lawyers signature must be accepted as substantial
compliance with the requirements of the Circular.
Regrettably, we find that substantial compliance will not
suffice in a matter involving strict observance as provided for in
Circular No. 28-91. The attestation contained in the certification
on non-forum shopping requires personal knowledge by the
party who executed the same. To merit the Courts consideration,
petitioners here must show reasonable cause for failure to
personally sign the certification. The petitioners must convince
the court that the outright dismissal of the petition would defeat
the administration of justice. However, the petitioners did not
give any explanation to warrant their exemption from the strict
application of rule. Utter disregard of the rules cannot justly be
rationalized by harking on the policy of liberal construction.
Concerning the second ground for the appellate courts
dismissal of the petition, it is required that:
2 The duplicate original copy must be duly signed or initialled by
the authorities or the corresponding officers or representative of
the issuing entity, or shall at least bear the dry seal thereof or
any other official indication of the authenticity and completeness
of such copy.[7] (Emphasis ours.)
Petitioners contend that they attached the very same
duplicate original copy of the decision which they revised from
the RTC. Said duplicate original copy of the decision, having
come from the trial court itself., petitioners believed in good faith
that, by attaching it to the petition, they would be considered to
have substantially complied with the filing requirements under
the law. However, strict compliance with procedural
requirements in taking an appeal cannot be substituted by good
faith compliance. To rule otherwise would defeat the very
purpose of the rules of procedure, i. e., to facilitate the orderly
administration of justice.[8]
Although the petitioners subsequently submitted to the CA
the corrected annexes of the Petition for review, the respondent
court ruled that it did not stop the questioned decision from
becoming final and executory.
The petitioners failed to fully satisfy the CA or this Court
that (1) the non-compliance with the requirements was not in
any way attributable to them; (2) they exerted due diligence; (3)
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
there are highly justifiable and compelling reasons for the court
to make a disposition in the interest of justice.[9]
The Petition for review filed by the Ortizes with the CA was
an appeal from the RTC in the exercise of its appellate
jurisdiction. Consequently, the Ortizes should bear in mind that
the right to appeal is not a natural right to a part of due process;
it is merely a statutory privilege, and may be exercised only in
manner and in accordance with the provisions of the law.[10] The
party who seeks to avail of the same must comply with the
requirements of the rules, Failing to do so, the right to appeal is
lost.[11] Rules of Procedure are required to be followed, except
only when for the most persuasive of reasons, they must be
relaxed to relieve a litigant of an injustice not commensurate
with the degree of his thoughtlessness in not complying with the
procedure prescribed.[12]
WHEREFORE, finding no reversible error nor grave abuse
of discretion committed by public respondent, the Court resolved
to DENY the Petition for Review on Certiorari and AFFIRM the
decision in CA-G.R. CV 42238. COST against the petitioners.
SO ORDERED.
G.R. No. 13300 September 29, 1919
BASILIA BOUGH and GUSTAVUS BOUGH, plaintiffs-
appellants,
vs.
MATILDE CANTIVEROS and PRESBITERA
HANOPOL, defendants-appellees.
MALCOLM, J.:
This action was begun in the Court of First Instance of Leyte,
pursuant to a complaint by means of which the plaintiffs Basilia
Bough and Gustavus Bough sought to have themselves put in
possession of the property covered by the deed of sale quoted
in the complaint, and to require the defendant Matilde
Cantiveros to pay the plaintiffs the sum of five hundreds pesos
by way of damages, and to pay the costs. Matilde Cantiveros
answered with a general denial and a special defense, not
sworn to, in which she asked that judgment be rendered
declaring the contract of sale theretofore made between herself
and Basilia Bough null. The plaintiffs, thereupon, denied under
oath the genuineness and due execution of the so-called
donation intervivos set forth in the answer. Presbitera Hanopol
was permitted to intervene as a defendant. After trial, judgment
was rendered by the Honorable W. E. McMahon, judge of first
instance, in favor of the defendants, declaring the deed of sale,
Exhibit A, fictitious, null, and without effect, and absolving the
defendants from the complaint, with costs against the plaintiffs.
It is from this judgment through the ordinary means of perfection
of a bill of exceptions that the case is brought to this court for
decision.
The facts are these: Matilde Cantiveros is reputed to be the
richest resident of the municipality of Carigara, Leyte. In the
latter part of the year 1913, she was the owner of various
parcels of realty of the value of thirty thousand pesos or more.
On December 24, 1912, Matilde Cantiveros and her husband
Jose Vasquez, signed a marital contract of separation. At this
time there lived with Matilde Cantiveros, Basilia Hanopol, a
cousin and protege since childhood, who was married to
Gustavus Bough. For this reason, Gustavus Bough was
regarded by Matilde Cantiveros with great confidence, even as
her child. Through the influence of Gustavus Bough, who
brought a story to Matilde Cantiveros that her husband Jose
Vasquez was in town and might contest the contract for the
separation of the conjugal property, Matilde Cantiveros was
induced to sign a fictitious contract of sale of all her property to
Basilia Bough. This document, introduced in evidence as Exhibit
A, was prepared in due from and acknowledged before a notary
public, the amount of the consideration, ten thousand pesos,
being last inserted with a pen. By this deed, Matilde Cantiveros
purported to convey sixty-three parcels of land, the real value of
which was over thirty thousand pesos, for ten thousand pesos,
although no evidence that any such sum ever passed between
the parties was introduced, to her cousin, Basilia Bough. In
order to reassure Matilde Cantiveros that they would not take
advantage of the fictitious sale, Gustavus Bough and Basilia
Bough prepared and signed another document, introduced in
evidence as Exhibit 1, which is a donation by them to Matilde
Cantiveros of all the property mentioned in Exhibit A, to be
effective in case of the death of themselves and their children
before the death of Matilde Cantiveros. The defendant, Matilde
Cantiveros, has remained in possession of the property.
These facts, which, it may be said, are mainly derived from the
findings of the trial court, merely repeat the threadbare story of a
conveyance of property entered into with a fraudulent intention
and for a fraudulent purpose, in order to defeat recovery in a suit
at law by a third party.
Plaintiffs and appellants assign six errors of the trial court. In so
far as these assignments concern the facts, they need no
discussion. Plaintiff's declarations have not been corroborated,
while defendant's story has been corroborated by reliable
witnesses. All the reason all the equity of the case, is in
favor of the defendants. As far as necessary for the disposition
of the appeal, we resolve plaintiff's points in order.
1. The first assignment of error reads: "The lower Court erred in
permitting the defendants to present evidence, over the
objections of the plaintiff, tending to impugn the genuineness
and due execution of the document, Exhibit A, and in admitting
them to show the circumstances under which it was executed.
It is undeniable that this was an action brought upon a written
instrument, and that the complaint contained a copy of the
instrument, but that its genuineness and due execution were not
specifically denied under oath in the answer. Is this fatal to the
defense?
Section 103 of the Philippine Code of Civil Procedure provides:
When an action is brought upon a written instrument and
the complaint contains or has annexed a copy of such
instrument, the genuineness and due execution of the
instrument shall be deemed admitted, unless specifically
denied under oath in the answer; and when the defense to
an action, or a counterclaim stated in an answer, is
founded upon a written instrument and the copy thereof is
contained in or annexed to the answer, the genuineness
and due execution of such instrument shall be deemed
admitted, unless specifically denied under oath by the
plaintiff in his pleadings.
This section is derived from sections 448 and 449 of the Code of
Civil Procedure of California, and is to be found in varying form
in the statutes of practically all the states of the American Union.
The meaning of this portion of the Code, and the intention of the
Legislature in enacting it, are easily found. The law says that the
genuineness and due execution of a written instrument properly
pleaded shall be deemed admitted unless the plaintiff or
defendant, as the case may be, shall specifically deny the same
under oath. When the law makes use of the phrase
"genuineness and due execution of the instrument" it means
nothing more than that the instrument is not spurious,
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
counterfeit, or of different import on its face from the one
executed. As an example, where the name of a corporation is
signed to the document which is the basis of an action, the
failure of the defendant corporation to put in issue, by denial
under oath, the due execution of the instrument, as required in
section 103 of the Code of Civil Procedure, operates as an
admission of the authority of the officer to execute the contract,
since the authority of the officer to bind the company is essential
to the due execution of its contract. But the failure of the party to
file an affidavit denying the genuineness and due execution of
the document does not estop him from controverting it by
evidence of fraud, mistake, compromise, payment, statute of
limitations, estoppel, and want of consideration. As section 285
of our Code of Civil Procedure permits a writing to be
impeached because of its illegality or fraud, such a defense
would not be barred by the provisions of section 103.
We hold that although the defendants did not deny the
genuineness and due execution of the contract of sale of
December 9, 1913, under oath, yet the defendants could
properly set up the defenses of fraud and want of consideration.
2. The second assignment of error reads: "The lower Court
erred in finding that the plaintiff Gustavus Bough, having
prepared a contract of separation between the defendant
Matilde Cantiveros and her husband, Jose Vasquez, sought to
cause her to believe that she exposed herself to a suit by her
husband regarding her property, notwithstanding the contract of
separation, and for that reason and for the purpose of shielding
herself from the consequences of the apprehended suit, that
she and her mother executed the document Exhibit A."
Counsel relies on the provisions of article 1218 of the Civil
Code, which provides that "Public instruments are evidence,
even against a third person, of the fact which gave rise to their
execution and of the date of the latter." The effect of this article
has been announced in numerous decisions of the Supreme
Court of Spain and of this Court. But in conjunction with article
1218 of the Civil Code, there should always be read section 285
of the Code of Civil Procedure which provides that:
When the terms of an agreement have been reduced
to writing by the parties, it is to be considered as
containing all those terms, and therefore there can be,
between the parties and their representatives or
successors in interest, no evidence of the terms of
agreement other than contents of the writing, except in
the following cases:
1. Where a mistake or imperfection of the writing, or its
failure to express the true intent and agreement of the
parties, is put in issue by the pleadings;
2. Where the validity of the agreement is the fact in
dispute. But this section does not exclude other
evidence of the circumstances under which the
agreement was made, or to which it relates, or to
explain an intrinsic ambiguity, or to establish its
illegality or fraud. The term `agreement' includes
deeds and intruments conveying real estate, and wills
as well as contracts between parties.
While thus as the law well says "public instruments are evidence
of the fact which gave rise to their execution" and are to be
considered as containing all the terms of the agreement, yet, if
the validity of the agreement is the issue, parole evidence may
be introduced to establish illegality or fraud. Evidence to
establish illegality or fraud, is expressly permitted under section
285 of the Code of Civil Procedure, and may be proved by
circumstantial evidence, aided by legitimate inferences from the
direct facts.
We hold that parole evidence was properly admitted to show the
illegality of the contract of sale introduced as Exhibit A.
3. The third point raised by appellant is, that the defendant,
having accepted the donation expressed in the instrument
Exhibit 1, is now estopped from denying the consideration set
forth therein. A sufficient answer is, that it having been
established that Exhibit A is invalid, such an instrument cannot
be made the basis of an estoppel.
We hold that the so-called donation in favor of Matilde
Cantiveros did not operate to create an estoppel.
4. The last question which is propounded by appellant relates to
the effect of the illegality of the instant contract.
It is rudimentary that contracting parties may not establish pacts,
clauses, and conditions, which conflict with the laws, morals, or
public order; "public order" signifies "the public weal" public
policy It is further well settled, that a party to an illegal contract
cannot come into a court of law and ask to have his illegal
objects carried out. The rule is expressed in the maxims: "Ex
dolo malo non oritur actio," and "In pari delicto potior est
conditio defendentis." The law will not aid either party to an
illegal agreement; it leaves the parties where it finds them.
Where, however, the parties to an illegal contract are not equally
guilty, and where public policy is considered as advanced by
allowing the more excusable of the two to sue for relief against
the transaction, relief is given to him. Cases of this character
are, where they conveyance was wrongfully induced by the
grantee through imposition or overreaching, or by false
representations, especially by one in a confidential relation. (13
C. J., 497-499; Pride vs. Andrew [1894], 51 Ohio State, 405.)
As corroborative examples of these principles, we may cite the
following:
Where a husband falsely represented to his wife that she
was liable for certain debts, and that the creditors would
take her property and influenced by this, and intending to
defraud such creditors, she transferred her property to him,
it was held that the deed would be set aside.
Where a party has given a conveyance of his property with
intent to defraud a creditor, the law will allow him no relief
against such conveyance, but will leave him in the situation
in which he has placed himself. But where there is no
creditor in fact, but only an imaginary one, through fear of
whom the grantor, encouraged by the grantee, makes the
conveyance, a fraudulent intent will not be imputed to the
grantor, and where the conveyance of the property has
been without consideration, he may recover the same or its
value. (Kervick vs. Mitchell [1885], 68 Iowa, 273.)
Where a son falsely represented to his mother that a suit
was about to be brought against her for slander which
would result in her losing all her property, and thereby
induced her to convey all her property to him, it was held
that the conveyance would be set aside at her suit.
(Harper vs. Harper & Co. [1887], 85 Ky., 160.)
Where a woman seventy years of age and illiterate was
induced by her son-in-law and the sureties on his bond to
execute a mortgage to the sureties to indemnify them on a
defalcation by the son-in-law, by holding out to her the
anticipated punishment of the latter, without allowing her a
chance to consult any disinterested friend, it was held that
the mortgage would be set aside.
One who executes a bill of sale at the instance of the
grantee for the purpose of putting his property beyond the
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
reach of a third person whom the grantee represented was
about to institute suit against the grantor, is entitled to
recover the value of the property, where such third person
had no valid claim against the grantor, but had been settled
with in full, and his receipt taken.
A brother who conveyed property to his sister on a secret
trust for his benefit, to defeat any claim for alimony which
his wife, who had instituted a suit for divorce, might make
against him, is entitled to enforce the trust upon which the
conveyance was made, where it does not appear that any
claim for alimony was ever set up by his wife, or allowed, or
that facts existed entitling her to such an allowance. The
court said: `It does not appear that there was any creditor
whose rights or interests could be prejudiced by the
conveyance, and the question is whether or not the mere
motive which impelled the party to make the deed will
preclude him from enforcing the trust upon which it was
executed. We think that where there is no creditor, there is
no fraud, and therefore no policy of the law to prevent the
enforcement of the trust.
A conveyance made by a mother to a daughter in
consequence of false representations that her property
might otherwise be taken from her to satisfy a claim for
alimony arising from a suit for divorce about to be brought
against her son by his wife will be cancelled. The Court
said: "If the conveyance was made for the purpose of
protecting the property from such claim, such
representations being untrue, and such apprehensions in
fact groundless, then she is entitled to have the deeds set
aside."
In this instance, the grantor, reposing faith in the integrity of the
grantee, and relying on a suggested occurrence, which did not
in fact take place, was made the dupe of the grantee, and led
into an agreement against public policy. The party asking to be
relieved from the agreement which she was induced to enter
into by means of fraud, was thus in delicto, but not in pari
delicto with the other party. The deed was procured by
misrepresentation and fraud sufficient to vitiate the transaction.
The rights of creditors are not affected. We feel that justice will
be done if we place the grantor in the position in which she was
before these transactions were entered into.
The facts of this case are not greatly dissimilar from those to be
found in Hibberd vs. Rohde and McMillian([1915], 32 Phil., 476),
relating to the defenses permissible where an instrument was
submitted by the plaintiff, and not denied under oath by the
defendant, and to the subject of contracts against public policy.
The doctrine there announced need not be incorporated in this
decision.
We resolve each assignment of error against the appellants, and
having done so, affirm the judgment of the trial court, with costs
of this instance against the appellants. So ordered.
G.R. No. L-8418 December 9, 1915
L.O. HIBBERD, plaintiff-appellant,
vs.
WM. J. ROHDE and D.J. MCMILLIAN, defendants-appellees.
TRENT, J.:
This is a suit on a promissory note against the makers. Only one
of them, the defendant Rohde, appeared and answered. He not
having entered a verified specific denial of the genuineness and
due execution of the note, the plaintiff claims that his special
defense of illegality of consideration is cut off by section 103 of
the Code of Civil Procedure, which reads as follows: "Actions
and defenses based upon a written instruments. When an
action is brought upon a written instrument and the complaint
contains or has annexed a copy of such instrument, the
genuineness and due execution of the instrument shall be
deemed admitted, unless specifically denied under oath in the
answer; and when the defense to an action, or a counterclaim
stated in an answer, is founded upon a written instrument and
the copy thereof is contained in or annexed to the answer, the
genuineness and due execution of such instrument shall be
deemed admitted, unless specifically denied under oath by the
plaintiff in his pleadings."
By the admission of the genuineness and due execution of an
instrument, as provided in this section, is meant that the party
whose signature it bears admits that he signed it or that it was
signed by another for him with his authority; that at the time it
was signed it was in words and figures exactly as set out in the
pleadings of the party relying upon it; that the documents was
delivered; and that any formal requisites required by law, such
as a seal, an acknowledgment, or revenue stamp, which it lacks,
are waived by him. Hence, such defense as that the signature is
a forgery \; or that it was unauthorized, as in the case of an
agent signing for his principal, or one signing in behalf of a
partnership, or of a corporation; or that, in the case of the latter,
that the corporation was not authorized under its charter to sign
the instrument; or that the party charged signed the instrument
in some other capacity than that alleged in the pleading setting it
out; or that it was never delivered are cut off by the admission of
its genuineness and due execution.
The effect of the admission is such that in the case of a
promissory note a prima facie case is made for the plaintiff
which dispenses with the necessity of evidence on his part and
entitles him to a judgment on the pleadings unless a special
defense of new matter, such as payment, is interposed by the
defendant. But we have held that the section is not applicable to
the indorsement on a promissory note in a suit against the
maker; nor against the heirs of decedent who signed a
document declared upon 1awphil.net Under statutes similar to
our own it has been held that the admission of the genuineness
and due execution of the instrument does not bar the defense of
want of consideration. And in Kentucky in actions based upon
promissory notes the consideration for which were gambling
debts, it has been held that such an admission does not prevent
the defense of illegality of consideration. In Freeman vs. Ellison
(37 Mich., 458), it was said: "It is now claimed for plaintiff below
that this (rule) precludes any inquiry into the date of delivery or
the circumstances of the signing as bearing on any defenses
dependent on time in any way.
There is no authority that we know of or any such
construction of the rule. Undoubtedly when a plaintiff
produces in court an instrument corresponding to the
one set forth he is exempted from proving its
execution. But the actual time of delivery may involve
questions which it would be absurd to hold foreclosed
by any such assumption, If a note is dated back in
order to include usurious interest, and that defense is
set up, it would hardly be regarded as bearing on the
question of execution. Execution can only refer to the
actual making and delivery, but it cannot involved other
matters without enlarging its meaning beyond reason.
The only object of the rule was to enable a plaintiff to
make out a prima facie, not a conclusive case, and it
cannot preclude a defendant from introducing any
defense on the merits which does not contradict the
execution of the instrument introduced in evidence.
To so interpret section 103 as to prohibit such a defense as
illegality of consideration, which is clearly a defense of new
matter, would pro tanto repeal the second paragraph of section
94, which permits a defendant to answer by "A statement
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
of any new matter constituting a defense or counterclaim."
Likewise, section 285 provides that the terms of a writing may
be impeached by reason of its illegality or fraud. We do not
understand that such defenses are barred by the provisions of
section 103. We accordingly hold that the special defense
interposed by the defendant of illegality of consideration is not
barred by his failure to enter a verified denial of the genuineness
and due execution of the note set out in the complaint. Hence,
the evidence in support of that plea was competent. The note
reads as follows:itc-a1f
BAGUIO, BENGUET, April 27th, 1911.
For value received, we the undersigned parties, jointly and
severally agree to pay to the firm of Brand & Hibberd, of the
city of Baguio, P. I., twelve hundred pesos, Philippine
currency, in monthly installments of one hundred pesos per
month, beginning with the first day of June, 1911. (Not
transferable, excepting to Jos. C. Brand or L.O. Hibberd.)
WM. J. ROHDE.
D. J. MCMILLIAN.
According to the testimony of the defendant Rohde, McMillian
was in the retail liquor business and secured a stock of
merchandise valued at P1,200 from Brand & Hibberd and sold
it. Alleging that they delivered the merchandise to him on
deposit only, Brand & Hibberd filed a complaint of estafa against
McMillian. McMillian was arrested and released on bond
pending the preliminary hearing before the justice of the peace.
The defendant Rohde was a practicing attorney and undertook
McMillian's defense in the estafa case. Rohde testified that he
was well acquainted with the nature of the transaction between
the firm of Brand & Hibberd and McMillian; that the merchandise
was sold outright to McMillian; that he know the estafa complaint
was absolutely without foundation; and that McMillian could not
possibly be convicted; but that one Sullivan informed him after
the preliminary hearing was held that he knew positively that
McMillian would be bound over for trial in the Court of First
Instance. In rebuttal, Sullivan testified that what he told Rohde
was that he was satisfied from the evidence introduced at the
hearing that McMillian would be held for trial in the Court of First
Instance. Upon the strength of Sullivan's statement, Rohde
agreed to sign the note reproduced above if Brand & Hibberd
would withdraw the estafa complaint. He did this because he did
not want his client to remain in confinement pending his trial in
the Court of First Instance, which would not have occurred for
three months. His client was sick at the time and Rohde was
afraid that confinement in the jail for such a period of time would
seriously endanger his health. After the execution of the note,
Brand & Hibberd moved in the justice court that the estafa
complaint be dismissed and this motion was granted by the
presiding justice. In the order dismissing the complaint, the
justice stated that, from the evidence introduced at the hearing
he was convinced that there was no sufficient basis for a
criminal action, but that the controversy was of a civil character.
Rohde subsequently paid two hundred pesos on the note. The
note was assigned to the plaintiff L.O. Hibberd, on June 10,
1911.
Any agreement which has for its purpose the concealment of a
public offense, the suppression of evidence thereof, or the
stifling of a criminal prosecution already commenced is contra
bonos mores and against public policy. Every successful attempt
to shield persons guilty of such offenses adds impetus to crime
by encouraging the culprits and all others of criminal tendencies
who may learn of such perversions of justice, to commit further
offenses. A person suffering pecuniary from the commission of
such a crime may not barter away the benefits of public order
and the personal safety and security of the people by
representing to the culprit that he will actively aid in the task of
securing immunity from the public prosecution if his civil
damages are made good. Courts are charged with the duty of
administering the law, and they should not lend their aid to the
enforcement of any contract which looks to its perversion. Nor is
it important that the shielding of the guilty party was a minor
consideration of the agreement, or necessary that a crime shall
have been in fact committed. The intention of the parties to
obstruct criminal justice to whatever extent taints the entire
contract and makes it unenforcible. The courts will not interfere
either to rescind an executed contract or to enforce an
executory contract of such character. The parties are left just
where they are found.
A very large number of public offenses, however, inflict
pecuniary damage on private persons. The Penal Code
recognizes the civil liability of offenders (arts. 119, et seq). In this
civil liability the State has no interest other than its undertaking
to aid the injure person in securing compensation for his injuries,
and it cannot be doubted that if the injured person so desires he
may privately negotiate with the criminals or with persons
interested in the latter for the settlement of his private damages.
Article 1813 of the Civil Code provides that a civil action arising
from a crime may be compromised, but the public action for the
imposition of the legal penalty shall not be extinguished thereby.
So long as the right of the State to exact the penalty for the
public offense is not trenched upon, there is nothing unlawful or
immoral in such a contract. And mere threats of prosecution will
not vitiate an instrument given for an amount embezzled or for
the value of property feloniously taken, unless coupled with an
agreement not to prosecute if the instrument be given. A mere
expectation of the one of the parties that the settlement of the
civil injuries will stop the public prosecution is not sufficient to
make such a contract void as against public morals or public
policy. As was said in Moog vs. Strang (69 Ala., 98), the law
does not "seek to control the hope or expectation of the
offender. He may very reasonably, in many cases, expect that
the prompt settlement of a discovered default may tend to
paralyze the energy of an incipient prosecution, and however
reprehensible the motives of the parties, they are not cognizable
by the courts so long as their minds falls short of concurring in
an agreement, express or implied, to compound or not to
prosecute as the consideration in part or in whole of the
payment of the debt or damages resulting from the crime
committed."
In this country a personal is not an accessory to a public offense
except in the cases expressly provided by law. In
Goodrum vs. Merchants & Planters Bank , it appears that
Goodrum was manager of bank and that one Eagle held the
majority of the bank's capital stock and controlled its policies.
Goodrum defaulted, and to settle his shortage executed a trust
deed which was to be surrendered to the bank in case an
examination shows that he was criminally liable. In a suit by the
bank to compel the conveyance, Goodrum sought to show the
illegality of the contract by evidence that he had been promised
immunity from criminal prosecution if he would make good the
shortage. Eagle testified that he promised that, if the
conveyance were made, "We won't lie around the courthouse
and try to prosecute him: but if the grand jury calls on me and
asks me to explain these books and asks me if the shortage
occurred upon the expert's report, I will tell them everything I
know about it." The court said: "We do not think that this
statement of Mr. eagle in effect that he would not go before the
grand jury until summoned to appear was an implied agreement
either to withhold testimony, conceal the crime, or to stifle the
prosecution under the facts and circumstances of this case. The
charges made against Goodrum that he was short in his
accounts with the bank, and criminally so, were not only known
to all the directors and persons present at the conference, but
they had been published to the world, and the knowledge
thereof rife amongst the people of that community, if not also
amongst the people of the country. This is not a case where the
charges were only known by a few persons, and upon their
failure to divulge them they would not come to the notice or
knowledge of the public or to those to whom the prosecution of
crime is entrusted by the law. ... At the most, Eagle only stated
that he would not instigate a prosecution. ... Because he would
remain passive relative to matters of which the public authorities
had full knowledge, it can not be said that he thereby agreed to
shield Goodrum from any public prosecution."
In Nickelson vs. Wilson (60 N.Y., 362), it was said: "But an
agreement to lay the whole facts before the court, and to leave it
to the free exercise of the discretionary powers vested in it by
law, is not in itself wrong, and is not rendered illegal even by a
stipulation on the part of a prosecutor to exert such legitimate
influence as his position gives him in favor of the extension of
mercy to a guilty party."
Whether the tendency of an agreement is to interfere with the
due enforcement of criminal law is always a question of fact.
In the case at bar, the finding of fact made by the court below
have been duly submitted to us for review. The trial court found
as a fact that the consideration of the note was the compromise
of a public offense. We do not think that the evidence justifies
this conclusion. It is true that the defendant Rohde testified that
the consideration of the note was "the withdrawal of the false
charge against him (McMillian) and to get him out of jail." But it
is also in evidence that McMillian owed Brand & Hibberd the full
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
amount of the note and Rohde knew this fact before he signed
the note. There is no charge that Brand & Hibberd file the
criminal complaint with a view of extorting a settlement of their
claim against McMillian. The hearing at the preliminary
investigation was duly had and all the evidence was before the
justice of the peace before the agreement represented by the
note was made. It is not shown that Brand & Hibberd agreed not
to testify in any further criminal proceedings against McMillian,
or that they would suppress any evidence in their possession, or
that they would solicit the State's prosecutor or any other
Government official whose authority extend to the criminal case,
to not hold the defendant for trial. What they actually did was to
move in open court for a dismissal of the complaint. This is all
they did so far as the record shows, and that it was satisfactory
to the defendant Rohde is apparent from the fact that he
subsequently made partial payments on the note.
There can be no doubt that the agreement which resulted in the
execution of the note was entered into by Brand & Hibberd with
an eye to the satisfaction of their pecuniary claim against
McMillian. From the testimony of Rohde himself it appears that
he strongly insisted that McMillian was not guilty of the crime
charged, and no doubt his ability as a lawyer tended to convince
the complainants that the criminal charge was unjustified. If they
became converted to this view of the matter, they no doubt more
readily consented not to actively assist in the further prosecution
of the criminal complaint. We do not think the record justifies a
more radical conclusion as to what Brand & Hibberd agreed to
do with reference to the criminal phase of the transaction than
that they promised not to further actively participate in the case.
The record does not justify the conclusion that they went further
and agreed to actively assist in preventing the due investigation
of the criminal charge by suppressing evidence, by declining to
appear against McMillian if duly subpoenaed as witnesses, or by
other means. In our opinion, the case is similar in many aspects
to Goodrum vs. Merchants & Planters Bank (102 Ark., 326), to
which we have referred above. The record indicates the same
passivity on the part of the injured party and the same publicity
of the criminal charge. There having been no agreement to
interfere with the due administration of the criminal law, we are
constrained to hold that no part of the consideration of the note
declared upon his illegal or against public policy. The plaintiff is
therefore entitled to judgment. The judgment appealed from is
reversed and judgment is decreed against the defendant Rohde
for the sum of one thousand pesos, the amount remaining
unpaid on the note, together with legal interest from the date of
the institution of this action. Without costs. So ordered.
G.R. No. L-57821 January 17, 1985
SEGUNDINO TORIBIO, EUSEBIA TORIBIO, and the HEIRS
OF OLEGARIO TORIBIO, represented by his widow, ADELA
DE LOS REYES, petitioners,
vs.
THE HON. JUDGE ABDULWAHID A. BIDIN, in his capacity
as Presiding Judge, Branch I, Court of First Instance, City
of Zamboanga, DALMACIO RAMOS, and JUANITO
CAMACHO, respondents.
GUTIERREZ, J.:
This petition is premised on the interpretation and application of
Sections 7 and 8, Rule 8 of the Revised Rules of Court on
actionable documents, which state:
SEC. 7. Action or defense based on document.
Whenever an action or defense is based upon a written
instrument or document, the substance of such
instrument or document shall be set forth in the
pleading, and the original or a copy thereof shall be
attached to the pleading as an exhibit, which shall be
deemed to be a part of the pleading, or said copy may
with like effect be set forth in the pleading.
SEC. 8. How to contest genuineness of such
documents. When an action or defense is founded
upon a written instrument, copied in or attached to the
corresponding pleading as provided in the preceding
section, the genuineness and due execution of the
instrument shall be deemed admitted unless the
adverse party, under oath, specifically denies them, and
sets forth what he claims to be the facts; but this
provision does not apply when the adverse party does
not appear to be a party to the instrument or when
compliance with an order for an inspection of the
original instrument is refused.
The present controversy stems from a complaint filed by the
petitioners against private respondents Dalmacio Ramos and
Juanita Camacho.
Engracio Francisco and Juliana Esteban were the registered
owners of the parcel of land Zamboanga. At the death of said
spouses, they were survived by their ten (10) children who
inherited their state in equal pro indiviso shares. Subsequently,
the property was subdivided among the heirs and a portion
designated as Lot No. 1943-B was allotted to the Justa
Francisco. Justa died and was survived among by eight (8)
children namely: Dionoso, Eufremia, Alfonso, Rafael, Petrona,
Olegario, Segundino and Eusebia, all surnamed Toribio, who
eight heirs, Eufremia, Alfonso and Petrona, sold their in the
property to Ramon Ledesma. Rafael also sold his share to
Dinisio who, in turn, sold the same to Ramon Ledesma. Thus,
the latter acquired four (4) shares out of eight (8) shares, or a
pro indiviso share of Lot 1943-B.
Subsequently, Dionisio sold his own hereditary share in the
aforesaid estate of his mother to Juanito Camacho, who by said
sale acquired a 1/8 pro indiviso share of the property.
The three other heirs, petitioners Segundino Eusebia and
Olegario alleging that their shares had never been sold nor in
any wise transferred or disposed to others filed a case against
herein private respondents for recovery of hereditary rights. How
Juanito Camacho, who was entitled to only a total area of 931
square meters, nor, how one Dalmacio Ramos, Jr., acquired
share of the property was allegedly not known to them.
In their answer, the defendants-respondents alleged that the
shares of plaintiffs-petitioners had likewise been sold to Dionisio
Toribio, their brother, who, in turn, sold the same to Juanito
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
Camacho and Dalmacio Ramos. The alleged sale from
petitioners to Dionisio and the sale from Dionisio to the
respondents were evidenced by deeds of sale, xerox copies of
which were appended to and made an integral part of the
respondents' partition agreement between the respondents and
also a xerox copy of the respondents' transfer certificates of title.
While testifying during the trial, Eusebia Toribio was asked
whether she executed any sale of her share in the parcel of land
in litigation. The counsel for private respondents objected,
raising the proper mode of contesting the genuineness of an
actionable document pursuant to Sections 7 and 8, Rule 8 of the
Revised Rules of Court. The trial court sustained the objection.
Petitioners, thereupon, filed a constancia with a motion for
reconsideration stating that the documents submitted by the
respondents were merely evidentiary in nature, not a cause of
action or defense, the due execution and genuineness of which
they had to prove. They alleged that the subject of litigation was
the hereditary shares of plaintiffs-petitioners, not any document.
They stated that the defense consisting mainly of transfer
certificates of titles in the respondents' names originating from
the sale from petitioners to Dionisio and from the latter to the
respondents were merely evidentiary in nature. They argued
that a simple specific denial without oath is sufficient. The court
denied the motion for reconsideration. The documents attached
to the respondents' answer and made an integral part thereof
were declared to be the very foundation or basis of the
respondents' defense and not merely evidentiary in nature.
Hence, this petition for review on certiorari.
The initial issue brought before us is whether or not the deeds of
sale allegedly executed by the petitioners in favor of their
brother Dionisio Toribio and appended to the respondents'
answer are merely evidentiary in nature or the very foundation
of their defense which must be denied under oath by the
petitioner.
The records show that the deeds of sale are actionable
documents.
Jurisprudence has centered mainly on a discussion of
actionable documents as basis of a plaintiff's cause of action.
Little has been said of actionable documents being the
foundation of a defense. The Rule, however, covers both an
action or a defense based on documents.
The situation obtaining in the case at bar is not a common one.
The usual case is between plaintiff and defendant where, the
latter, as his defense, would present a document to which both
parties are parties and which states that the former relinquishes
his rights to the defendant. In the case at bar, we have a
situation where the defendant presented a document in his
defense, a document to which the plaintiff is a party but to which
defendant is not. Thus, the question arises as to whether or not
the document is included as a necessary part of the defense so
as to make it actionable.
The petitioners alleged in their complaint that their shares in the
inheritance left by their mother were never sold nor in any wise
transferred or disposed to others.
The defendants, in their answers, declare:
xxx xxx xxx
... that the hereditary shares of plaintiffs OLEGARIO
TORIBIO, SEGUNDINO TORIBIO and EUSEBIA
TORIBIO were likewise sold, transferred and conveyed,
first in favor of DIONISIO TORIBIO by virtue of two (2)
deeds of sale executed in due form on October 24, 1964
and November 2, 1964, respectively, and thereafter, by
DIONISIO TORIBIO in favor of defendants JUANITO A.
CAMACHO and DALMACIO C. RAMOS, JR., on
November 11, 1964 as adverted to in the preceding
paragraph, as will be discussed further in the specific
and/or affirmative defenses hereunder; ...
As heretofore alleged, the hereditary shares of all the
plaintiffs herein in and over Lot 1943-B were all sold,
transferred and conveyed in favor of DIONISIO TORIBIO
plaintiffs OLEGARIO TORIBIO and SEGUNDINO
TORIBIO on October 24, 1964 and that of plaintiff
EUSEBIA TORIBIO on November 2, 1964, by virtue of two
(2) deeds of sale all of which were acknowledged before
Notary Public for and within the City of Zamboanga, Atty.
Armando B. Torralba and entered as Doc. No. 6, Page No.
3, Book No. IX, Series of 1964, respectively, in his notarial
register, xerox copies of which are appended hereto to
form integral part hereof as Annexes "1" & "2",
respectively.
From the foregoing, it is clear that the respondents anchor their
defense on the deeds of sale by virtue of which the hereditary
rights of all the petitioners over Lot 1943-B were sold,
transferred, and conveyed in favor of their brother, Dionisio
Toribio, who in turn sold the same to herein respondents. The
deed of sale executed by the petitioners in favor of their brother
Dionisio is an essential and indispensable part of their defense
to the allegation that the petitioners had never disposed of their
property.
The following question furnishes an absolute test as to the
essentiality of any allegation: Can it be made the subject of a
material issue? In other words, if it be denied, win the failure to
prove it decide the case in whole or in part? If it will not, the fact
is not essential. It is not one of those which constitute the cause
of action, defense, or reply (Sutherland's Code of Pleading,
Practice and Forms, p. 82). A fact is essential if it cannot be
stricken out without leaving the statement of the cause of action
or defense insufficient.
Apart from alleging that the documents in this case are merely
evidentiary, the petitioners also point out that the deeds of sale
purportedly executed by them were in favor of their brother,
Dionisio, who in turn executed deeds of sale in favor of the
respondents. Under this circumstance, does the genuineness
and due execution of the deeds evidencing the two transactions
have to be denied under oath?
The deed of sale executed by Dionisio Toribio in favor of the
respondents, by itself, would be insufficient to establish a
defense against the petitioners' claims. If the petitioners deny
that they ever sold their shares in the inherited lot to their
brother Dionisio, a failure to prove the sale would be decisive.
For if it can be shown that no conveyance of the property was
executed by the petitioners, then Dionisio Toribio had no right to
convey what did not belong to him. The respondents could
acquire only the rights that Dionisio had over the disputed
property. The genuineness and due execution of the deed
between the co-heirs is also elemental to the defense of the
respondents. The first deeds of sale, to which the respondents
were not parties but which they seek to enforce against the
parties are also actionable documents.
The petitioners further alleged that this case falls under the
exception to Section 8, Rule 8 which provides:
SECTION 8. ... but this provision does not apply when
the adverse party does not appear to be a party to the
instrument.
As early as Lim-Chingco v. Terariray (5 Phil. 120), this Court
gave the reason for the rule on contesting actionable
documents. The purpose is:
 CIVIL PROCEDURE RULE 7-9 FULL TEXT
Reasonably construed, the purpose of the enactment (sec. xxx xxx xxx
103) appears to have been to relieve a party of the trouble
and expense of proving in the first instance an alleged fact, The complaint was verified under oath by the petitioners.
the existence or nonexistence of which is necessarily within
the knowledge of the adverse party, and of the necessity (to
his opponent's case) of establishing which such adverse The petitioners' counsel was obviously lulled into complacency
party is notified by his opponent's pleading. by two factors. First, the plaintiffs, now petitioners, had already
stated under oath that they never sold, transferred, or disposed
of their shares in the inheritance to others. Second, the usual
This being so, the documents have to be treated in like manner.
procedure is for a defendant to specifically deny under oath the
The petitioners are themselves parties to the deeds of sale
genuineness and due execution of documents set forth in and
which are sought to be enforced against them. The complaint
annexed to the complaint. Somehow, it skipped counsel's
was filed by the petitioners. They filed suit to recover their
attention that the rule refers to either an action or
hereditary properties. The new owners introduced deeds of sale
a defense based upon a written instrument or document. It
as their main defense. In other words, the petitioners brought
applies to both plaintiffs and defendants.
the issue upon themselves. They should meet it properly
according to the Rules of Court.
Under the facts of this case, the private respondents were
placed on adequate notice by Paragraph 11 of the verified
Sections 7 and 8 of Rule 8, therefore, apply. The proper
complaint that they would be caned upon during trial to prove
procedure was for the petitioners to specifically deny under oath
the genuineness or due execution of the disputed deeds of sale.
the genuineness and due execution of the questioned deeds of
sale and to set forth what they claim to be the facts. However,
the oversight or negligence of petitioners' counsel in not properly Moreover, the heirs of Olegario Toribio, his widow and minor
drafting a reply to the answer and an answer to the counter children represented by their mother, are among the plaintiffs-
claim is not necessarily fatal to their cause. petitioners. They are not parties to the deeds of sale allegedly
executed by their father, aunt, and uncle. They are not required
to deny the deeds of sale under oath. The private respondents
The facts of the case and equitable considerations constrain us
will still have to introduce evidence to establish that the deeds of
to grant the petition and to set aside the questioned order of the
sale are genuine and that they were truly executed by the
respondent court.
parties with authority to dispose of the disputed property.

As stated earlier, the reason for the rule is to enable the adverse
It bears repeating that rules of procedure should be liberally
party to know beforehand whether he will have to meet the issue
construed to the end that substantial justice may be served. As
of genuineness or due execution of the document during trial.
stated in Pongasi v. Court of Appeals (71 SCRA 614):
(In re Dick's Estate, 235 N.W. 401). While mandatory, the rule is
a discovery procedure and must be reasonably construed to
attain its purpose, and in a way as not to effect a denial of We repeat what We said in Obut v. Court of Appeals, et
substantial justice. The interpretation should be one which assist al., supra, that 'what should guide judicial action is the
the parties in obtaining a speedy, inexpensive, and most principle that a party-litigant is to be given the fullest
important, a just determination of the disputed issues. opportunity to establish the merits of his complaint or
defense rather than for him to lose life, liberty, honor
Paragraphs 11 and 13 of the petitioners' complaint reads:
or property on technicalities.

xxx xxx xxx In dispensing justice Our action must reflect a deep
insight into the failings of human nature, a capability for
making allowances for human error and/or negligence,
11. That the share of herein Plaintiffs were never sold or in
and the ability to maintain the scales of justice happily
any wise transferred or disposed to others;
well-balanced between these virtues and the application
of the law.
xxx xxx xxx

An interpretation of a rule of procedure which would not deny to

13. That just how and by what means Defendant,
the petitioners their rights to their inheritance is warranted by the
JUANITO CAMACHO was able to acquire the total area of
circumstances of this case.
931 square meters, is not known; however, the acquisition
might have been effected, the same was in fraud of herein
plaintiffs; and so with the share of Defendant, DALMACIO WHEREFORE, the order of the respondent court dated July 20,
C. RAMOS, Jr., herein Plaintiffs, jointly and/or severally, 1981 is hereby REVERSED and SET ASIDE. The Regional Trial
do not know the person; and, however he might have Court which took over the cases of the respondent court is
acquired the said share of ONE FOURTH () of the ordered to receive the petitioners' evidence regarding the
property, was not from either, much less all of the genuineness and due execution of the disputed deeds of sale.
Plaintiffs;

SO ORDERED.