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CASE 2011-0179: ADVENT CAPITAL AND FINANCE CORPORATION VS. ROLAND YOUNG (G.R. NO. 183018, 03 AUGUST 2011, CARPIO, J.) SUBJECT: REPLEVIN (BRIEF TITLE: ADVENT CAPITAL VS. YOUNG).

Filed under: LATEST SUPREME COURT CASES — 1 Comment

September 3, 2011

CASE 2011-0179: ADVENT CAPITAL AND FINANCE CORPORATION VS. ROLAND YOUNG (G.R. NO. 183018, 03 AUGUST 2011, CARPIO, J.) SUBJECTS: REPLEVIN; CLAIM AGAINST REPLEVIN BOND. (BRIEF TITLE: ADVENT CAPITAL VS. YOUNG).

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ADVENT CAPITAL FILED A REPLEVIN CASE AGAINST YOUNG AND SECURED A WRIT OF SEIZURE ORDERING YOUNG TO SURRENDER A MBENZ IN THE NAME OF ADVENT. YOUNG SURRENDERED THE CAR TO ADVENT. RTC DISMISSED THE REPLEVIN CASE FOR FAILURE OF ADVENT TO PROSECUTE. SUCH DISMISSAL ORDER BECAME FINAL. IS YOUNG ENTITLED TO THE RETURN OF THE CAR?

YES. THIS IS THE NECESSARY CONSEQUENCE OF THE DISMISSAL OF THE REPLEVIN CASE. THE WRIT OF SEIZURE IS MERELY ANCILLARY IN NATURE. IT BECAME FUNCTUS OFFICIO AND SHOULD BE LIFTED.

We agree with the Court of Appeals in directing the trial court to return the seized car to Young since this is the necessary consequence of the dismissal of the replevin case for failure to prosecute without prejudice. Upon the dismissal of the replevin case for failure to prosecute, the writ of seizure, which is merely ancillary in nature, became functus officio and should have been lifted. There was no adjudication on the merits, which means that there was no determination of the issue who has the better right to possess the subject car. Advent cannot therefore retain possession of the subject car considering that it was not adjudged as the prevailing party entitled to the remedy of replevin.

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WHAT IS THE EFFECT OF THE DISMISSAL OF THE REPLEVIN CASE?

IT RESULTS TO THE RESTORATION OF THE PARTIES’ STATUS PRIOR TO LITIGATION, AS IF NO COMPLAINT HAS BEEN FILED AT ALL. ACCORDINGLY, THE PARTIES MUST BE REVERTED TO THEIR STATUS QUO ANTE. SINCE YOUNG POSSESSED THE SUBJECT CAR BEFORE THE FILING OF THE REPLEVIN CASE, THE SAME MUST BE RETURNED TO HIM, AS IF NO COMPLAINT WAS FILED AT ALL.

Contrary to Advent’s view, Olympia International Inc. v. Court of Appeals¹⁶ applies to this case. The dismissal of the replevin case for failure to prosecute results in the restoration of the parties’ status prior to litigation, as if no complaint was filed at all. To let the writ of seizure stand after the dismissal of the complaint would be adjudging Advent as the prevailing party, when precisely no decision on the merits had been rendered. Accordingly, the parties must be reverted to their status quo ante. Since Young possessed the subject car before the filing of the replevin case, the same must be returned to him, as if no complaint was filed at all.

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AFTER THE DECISION IN THE REPLEVIN CASE BECAME FINAL, YOUNG FILED AN OMNIBUS MOTION PRAYING FOR DAMAGES UNDER THE REPLEVIN BOND. CAN CLAIM OF YOUNG PROSPER?

NO. THE APPLICATION TO BE FILED AT ANY TIME BEFORE THE JUDGMENT BECOMES EXECUTORY.²⁰ IT SHOULD BE FILED IN THE SAME CASE THAT IS THE MAIN ACTION,²¹ AND WITH THE COURT HAVING JURISDICTION OVER THE CASE AT THE TIME OF THE APPLICATION.²²

Section 10, Rule 60 of the Rules of Court¹⁹ governs claims for damages on account of improper or irregular seizure in replevin cases. It provides that in replevin cases, as in receivership and injunction cases, the damages to be awarded upon the bond “shall be claimed, ascertained, and granted” in accordance with Section 20 of Rule 57 which reads:

Sec. 20. Claim for damages on account of improper, irregular or excessive attachment. – An application for damages on account of improper, irregular or excessive attachment must be filed before the trial or before appeal is perfected or before the judgment becomes executory, with due notice to the attaching obligee or his surety or sureties, setting forth the facts showing his right to damages and the amount thereof. Such damages may be awarded only after proper hearing and shall be included in the judgment on the main case. e

If the judgment of the appellate court be favorable to the party against whom the attachment was issued, he must claim damages sustained during the pendency of the appeal by filing an application in the appellate court with notice to the party in whose favor the attachment was issued or his surety or sureties, before the judgment of the appellate court becomes executory. The appellate court may allow the application to be heard and decided by the trial court.

Nothing herein contained shall prevent the party against whom the attachment was issued from recovering in the same action the damages awarded to him from any property of the attaching obligee not exempt from execution should the bond or deposit given by the latter be insufficient or fail to fully satisfy the award.

The above provision essentially allows the application to be filed at any time before the judgment becomes executory.²⁰ It should be filed in the same case that is the main action,²¹ and with the court having jurisdiction over the case at the time of the application.²²

e remed

In this case, there was no application for damages against Stronghold resulting from the issuance of the writ of seizure before the finality of the dismissal of the complaint for failure to prosecute. It appears that Young filed his omnibus motion claiming damages against Stronghold after the dismissal order issued by the trial court on 28 April 2005 had attained finality. While Young filed a motion for partial reconsideration on 10 June 2005, it only concerned the dismissal of his counterclaim, without any claim for damages against the replevin bond. It was only on 8 July 2005 that Young filed an omnibus motion seeking damages against the replevin bond, after the dismissal order had already become final for Advent’s non-appeal of such order. In fact, in his omnibus motion, Young stressed the finality of the dismissal order.²³ Thus, Young is barred from claiming damages against the replevin bond.

In Jao v. Royal Financing Corporation,²⁴ the Court held that defendant therein was precluded from claiming damages against the surety bond since defendant failed to file the application for damages before the termination of the case, thus:

The dismissal of the case filed by the plaintiffs-appellees on July 11, 1959, had become final and executory before the defendant-appellee corporation filed its motion for judgment on the bond on September 7, 1959. In the order of the trial court, dismissing the complaint, there appears no pronouncement whatsoever against the surety bond. The appellee-corporation failed to file its proper application for damages prior to the termination of the case against it. It is barred to do so now. The prevailing party, if such would be the proper term for the appellee-corporation, having failed to file its application for damages against the bond prior to the entry of final judgment, the bondsman-appellant is relieved of further liability thereunder.

Since Young is time-barred from claiming damages against the replevin bond, the dismissal order having attained finality after the application for damages, the Court of Appeals erred in ordering the trial court to set a hearing for the determination of damages against the replevin bond.

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SECOND DIVISION

ADVENT CAPITAL AND G.R. No. 183018

FINANCE CORPORATION,

Petitioner, Present:

CARPIO, J., Chairperson,

LEONARDO-DE CASTRO,^*

– versus – BRION,

PEREZ, and

SERENO, JJ.

ROLAND YOUNG, Promulgated:

Respondent. August 3, 2011

x—————————————————————————————–x

D E C I S I O N

CARPIO, J.:

The Case

This petition for review¹ assails the 28 December 2007 Decision² and 15 May 2008 Resolution³ of the Court of Appeals in CA-G.R. SP No. 96266. The Court of Appeals set aside the 24 March 2006 and 5 July 2006 Orders⁴ of theRegionalTrialCourtofMakatiCity, Branch 147, and directed petitioner Advent Capital and Finance Corporation to return the seized vehicle to respondent Roland Young. The Court of Appeals denied the motion for reconsideration.

The Antecedents

The present controversy stemmed from a replevin suit instituted by petitioner Advent Capital and Finance Corporation (Advent) against respondent Roland Young (Young) to recover the possession of a 1996 Mercedes Benz E230 with plate number UMN-168, which is registered in Advent’s name.⁵

Prior to the replevin case, or on 16 July 2001, Advent filed for corporate rehabilitation with the RegionalTrialCourtofMakatiCity, Branch 142 (rehabilitation court).⁶

On 27 August 2001, the rehabilitation court issued an Order (stay order) which states that “the enforcement of all claims whether for money or otherwise, and whether such enforcement is by court action or otherwise, against the petitioner (Advent), its guarantors and sureties not solidarily liable with it, is stayed.”⁷

On 5 November 2001, Young filed his Comment to the Petition for Rehabilitation, claiming, among others, several employee benefits allegedly due him as Advent’s former president and chief executive officer.

On 6 November 2002, the rehabilitation court approved the rehabilitation plan submitted by Advent. Included in the inventory of Advent’s assets was the subject car which remained in Young’s possession at the time.

Young’s obstinate refusal to return the subject car, after repeated demands, prompted Advent to file the replevin case on 8 July 2003. The complaint, docketed as Civil Case No. 03-776, was raffled to theRegionalTrialCourtofMakatiCity, Branch 147 (trial court).

After Advent’s posting of P3,000,000 replevin bond, which was double the value of the subject car at the time, through Stronghold Insurance Company, Incorporated (Stronghold), the trial court issued a Writ of Seizure⁸ directing the Sheriff to seize the subject car from Young. Upon receipt of the Writ of Seizure, Young turned over the car to Advent,⁹ which delivered the same to the rehabilitation receiver.¹⁰

Thereafter, Young filed an Answer alleging that as a former employee of Advent, he had the option to purchase the subject car at book value pursuant to the company car plan and to offset the value of the car with the proceeds of his retirement pay and stock option plan. Young sought the (1) execution of a deed of sale over the subject car; and (2) determination and payment of the net amount due him as retirement benefits under the stock option plan.

Advent filed a Reply with a motion to dismiss Young’s counterclaim, alleging that the counterclaim did not arise from or has no logical relationship with the issue of ownership of the subject car.

After issues have been joined, the parties entered into pre-trial on 2 April 2004, which resulted in the issuance of a pre-trial order of even date reciting the facts and the issues to be resolved during the trial.

On 28 April 2005, the trial court issued an Order dismissing the replevin case without prejudice for Advent’s failure to prosecute. In the same order, the trial court dismissed Young’s counterclaim against Advent for lack of jurisdiction. The order pertinently reads:

It appears that as of July 28, 2003, subject motor vehicle has been turned over to the plaintiff, thru its authorized representative, and adknowledged by the parties’ respective counsels in separate Manifestations filed. To date, no action had been taken by the plaintiff in the further prosecution of this case. Accordingly, this case is ordered dismissed without prejudice on the ground of failure to prosecute.

Anent plaintiff’s Motion to Dismiss defendant Young’s counterclaim for benefits under the retirement and stock purchase plan, the Court rules as follows: The only issue in this case is who is entitled to the possession of the subject motor vehicle. This issue may have a connection, but not a necessary connection with defendant’s rights under the retirement plan and stock purchase plan as to be considered a compulsory counterclaim.

x x x

Notably, defendant’s claim is basically one for benefits under and by virtue of his employment with the plaintiff, and the subject vehicle is merely an incident in that claim. Said claim is properly ventilated, as it is resolvable by, the Rehabilitation Courtwhich has jurisdiction and has acquired jurisdiction, to the exclusion of this Court. Accordingly, plaintiff’s Motion To Dismiss defendant Young’s counterclaim is granted.¹¹

On 10 June 2005, Young filed a motion for partial reconsideration of the dismissal order with respect to his counterclaim.

On 8 July 2005, Young filed an omnibus motion, praying that Advent return the subject car and pay him P1.2 million in damages “(f)or the improper and irregular seizure” of the subject car, to be charged against the replevin bond posted by Advent through Stronghold.

On 24 March 2006, the trial court issued an Order denying Young’s motion for partial reconsideration, viz:

In the instant case, defendant, in his counterclaim anchored her [sic] right of possession to the subject vehicle on his alleged right to purchase the same under the company car plan. However, considering that the Court has already declared that it no longer has jurisdiction to try defendant’s counterclaim as it is now part of the rehabilitation proceedings before the corporate court concerned, the assertions in the Motion for Reconsiderations (sic) will no longer stand.

On the other hand, the plaintiff did not file a Motion for Reconsideration of the same Order, dismissing the complaint for failure to prosecute, within the reglementary period. Hence, the same has attained finality.

Defendant alleged that the dismissal of the case resulted in the dissolution of the writ. Nonetheless, the Court deems it proper to suspend the resolution of the return of the subject vehicle. In this case, the subject vehicle was turned over to plaintiff by virtue of a writ of replevin validly issued, the latter having sufficiently shown that it is the absolute/registered owner thereof. This was not denied by the defendant. Plaintiff’s ownership includes its right of possession. The case has been dismissed without a decision on the merits having been rendered. Thus, to order the return of the vehicle to one who is yet to prove his right of possession would not be proper.

Accordingly, the Motion for Partial Reconsideration is denied.¹²

On 8 June 2006, Young filed a motion to resolve his omnibus motion.

In an Order dated 5 July 2006, the trial court denied the motion to resolve, to wit:

In the instant case, the Court suspended the resolution of the return of the vehicle to defendant Roland Young. It should be noted that the writ of replevin was validly issued in favor of the plaintiff and that it has sufficiently established ownership over the subject vehicle which includes its right to possess. On the other hand, the case (Olympia International vs. Court of Appeals) cited by defendant finds no application to this case, inasmuch as in the former the Court has not rendered judgment affirming plaintiff’s (Olympia) right of possession on the property seized. Moreover, the Court, in the Order dated April 28, 2005, has already denied defendant’s counterclaim upon which he based his right of possession on the ground of lack of jurisdiction. Accordingly, the Court reiterates its previous ruling that to order the return of the subject vehicle to defendant Young, who is yet to prove his right of possession before theRehabilitation Courtwould not be proper.

WHEREFORE, there being no new and substantial arguments raised, the Motion to Resolve is denied.¹³

Young filed a petition for certiorari and mandamus with the Court of Appeals seeking to annul the trial court’s Orders of 24 March 2006 and 5 July 2006.

The Court of Appeals’ Ruling

In his petition before the Court of Appeals, Young argued mainly that the trial court committed grave abuse of discretion amounting to lack or excess of jurisdiction in (1) not directing the return of the subject vehicle to him; (2) refusing to hold a hearing to determine the damages to be recovered against the replevin bond; and (3) dismissing his counterclaim.

The Court of Appeals ruled in favor of Young and annulled the assailed rulings of the trial court. The Court of Appeals held:

It is noteworthy that the case was dismissed by the court a quo for failure of Advent to prosecute the same. Upon dismissal of the case, the writ of seizure issued as an incident of the main action (for replevin) became functus officio and should have been recalled or lifted. Since there was no adjudication on the merits of the case, the issue of who between Advent and petitioner has the better right to possess the subject car was not determined. As such, the parties should be restored to their status immediately before the institution of the case.

The Supreme Court’s ruling in Olympia International, Inc. vs. Court of Appeals (supra) squarely applies to the present controversy, to wit:

“Indeed, logic and equity demand that the writ of replevin be cancelled. Being provisional and ancillary in character, its existence and efficacy depended on the outcome of the case. The case having been dismissed, so must the writ’s existence and efficacy be dissolved. To let the writ stand even after the dismissal of the case would be adjudgingOlympiaas the prevailing party, when precisely, no decision on the merits had been rendered. The case having been dismissed, it is as if no case was filed at all and the parties must revert to their status before the litigation.”

Indeed, as an eminent commentator on Remedial Law expounds:

“The plaintiff who obtains possession of the personal property by a writ of replevin does not acquire absolute title thereto, nor does the defendant acquire such title by rebonding the property, as they only hold the property subject to the final judgment in the action.” (I Regalado, Remedial Law Compendium, Eighth Revised Edition, p. 686)

Reversion of the parties to the status quo ante is the consequence ex proprio vigore of the dismissal of the case. Thus, in Laureano vs. Court of Appeals (324 SCRA 414), it was held:

“(A)lthough the commencement of a civil action stops the running of the statute of prescription or limitations, its dismissal or voluntary abandonment by plaintiff leaves the parties in exactly the same position as though no action had been commenced at all.”

By the same token, return of the subject car to petitioner pending rehabilitation of Advent does not constitute enforcement of claims against it, much more adjudication on the merits of petitioner’s counterclaim. In other words, an order for such return is not a violation of the stay order, which was issued by the rehabilitation court on August 27, 2001. x x x

Corollarily, petitioner’s claim against the replevin bond has no connection at all with the rehabilitation proceedings. The claim is not against the insolvent debtor (Advent) but against bondsman, Stronghold. Such claim is expressly authorized by Sec. 10, Rule 60, in relation to Sec. 20, Rule 57, id., x x x¹⁴

The dispositive portion of the Court of Appeals’ decision reads:

WHEREFORE, premises considered, the instant petition is PARTLY GRANTED. The orders of the Regional Trial Court dated March 24, 2006 and July 5, 2006 are ANNULLED and SET ASIDE in so far as they suspended resolution of petitioner’s motion for, and/or disallowed, the return of the subject car to petitioner. Accordingly, respondent Advent Capital and Finance Corporation is directed to return the subject car to petitioner.

TheRegionalTrialCourtofMakatiCity(Branch 147) is directed to conduct a hearing on, and determine, petitioner’s claim for damages against the replevin bond posted by Stronghold Insurance Co.

SO ORDERED.¹⁵

Advent filed a motion for reconsideration, which was denied by the Court of Appeals in a Resolution dated 15 May 2008.

The Issue

The main issue in this case is whether the Court of Appeals committed reversible error in (1) directing the return of the seized car to Young; and (2) ordering the trial court to set a hearing for the determination of damages against the replevin bond.

The Court’s Ruling

The petition is partially meritorious.

On returning the seized vehicle to Young

Advent’s contention that returning the subject car to Young would constitute a violation of the stay order issued by the rehabilitation court is untenable. As the Court of Appeals correctly concluded, returning the seized vehicle to Young is not an enforcement of a claim against Advent which must be suspended by virtue of the stay order issued by the rehabilitation court pursuant to Section 6 of the Interim Rules on Corporate Rehabilitation (Interim Rules).¹⁷ The issue in the replevin case is who has better right to possession of the car, and it was Advent that claimed a better right in filing the replevin case against Young. In defense, Young claimed a better right to possession of the car arising from Advent’s car plan to its executives, which he asserts entitles him to offset the value of the car against the proceeds of his retirement pay and stock option plan.

Young cannot collect a money “claim” against Advent within the contemplation of the Interim Rules. The term “claim” has been construed to refer to debts or demands of a pecuniary nature, or the assertion to have money paid by the company under rehabilitation to its creditors.¹⁸ In the replevin case, Young cannot demand that Advent pay him money because such payment, even if valid, has been “stayed” by order of the rehabilitation court. However, in the replevin case, Young can raise Advent’s car plan, coupled with his retirement pay and stock option plan, as giving him a better right to possession of the car. To repeat, Young is entitled to recover the subject car as a necessary consequence of the dismissal of the replevin case for failure to prosecute without prejudice.

On the damages against the replevin bond

e remed

WHEREFORE, the Court GRANTS the petition IN PART. The Court SETS ASIDE the portion in the assailed decision of the Court of Appeals in CA-G.R. SP No. 96266 ordering the trial court to set a hearing for the determination of damages against the replevin bond.

SO ORDERED.

ANTONIO T. CARPIO

Associate Justice

WE CONCUR:

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

ARTURO D. BRION JOSE PORTUGAL PEREZ

Associate Justice Associate Justice

MARIA LOURDES P. A. SERENO

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

ANTONIO T. CARPIO

Associate Justice

Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA

Chief Justice

* Designated Actimg Member per Special Order No. 1006 dated 10 June 2011.

1 Under Rule 45 of the Rules of Court.

2 Rollo, pp. 37-48. Penned by Associate Justice Edgardo P. Cruz with Associate Justices Fernanda Lampas Peralta and Normandie B. Pizarro concurring.

3Id. at 50. Penned by Associate Justice Edgardo P. Cruz with Associate Justices Fernanda Lampas Peralta and Normandie B. Pizarro concurring.

4Id. at 90-91, 92. Penned by Judge Maria Cristina J. Cornejo.

5 Young admitted Advent’s ownership of the subject car.Id. at 159.

6 Docketed as Civil Case No. 01-1122.

7 Rollo, p. 66.

8Id. at 155.

9Id. at 156. In a Manifestation dated 8 August 2003, Young stated that he turned over the possession of the subject car to Atty. Gerald Soriano, an Associate of Advent’s counsel Atty. Edgardo L. de Jesus.

10Id. at 94-95. Atty. Johnny Y. Aruego, Jr. from the Office of the Rehabilitation Receiver wrote a letter, addressed to Verano Law Firm (Young’s counsel), confirming that the subject car was indeed in the possession, control and custody of Atty. Danilo L. Concepcion.

11Id. at 89.

12Id. at 91.

13Id. at 92.

14Id. at 43-45.

15Id. at 47.

16 259 Phil. 841 (1989).

17 Sec. 6. Stay Order. – If the court finds the petition to be sufficient in form and substance, it shall, not later than five (5) days from the filing of the petition, issue an Order (a) appointing a Rehabilitation Receiver and fixing his bond; (b) staying enforcement of all claims, whether for money or otherwise and whether such enforcement is by court action or otherwise, against the debtor, its guarantors and sureties not solidarily liable with the debtor; (c) prohibiting the debtor from selling, encumbering, transferring, or disposing in any manner any of its properties except in the ordinary course of business; x x x

18 Finasia Investments and Finance Corporation v. Court of Appeals, G.R. No. 107002, 7 October 1994, 237 SCRA 446, 450 cited in Panlilio v. Regional Trial Court, G.R. No. 173846, 2 February 2011.

19 Sec. 10 (Rule 60) Judgment to include recovery against sureties.

The amount, if any, to be awarded to any party upon any bond filed in accordance with the provisions of this Rule, shall be claimed, ascertained, and granted under the same procedure as prescribed in section 20 of Rule 57.

20 Carlos v. Sandoval, 508 Phil. 260, 277. .

21 Id. citing Paramount Insurance Corp. v. Court of Appeals, 369 Phil. 641 (1999).

22Id.

23 CA rollo, p. 75. Young alleged in his Omnibus Motion that “In an Order dated 28 April 2005, the [trial court] dismissed the case on the ground of failure to prosecute. To date and despite the lapse of more than fifteen (15) days from notice, Advent has not moved for reconsideration.”

24 No. L-16716, 28 April 1962, 4 SCRA 1210, 1215-1216.

Comment

CASE 2011-0186: DEVELOPMENT BANK OF THE PHILIPPINES VS. HON. SILVERIO Q. CASTILLO and CRISTINA TRINIDAD ZARATE ROMERO (G.R. NO. 163827, 17 AUGUST 2011, VILLARAMA, JR., J.) SUBJECT: CAUSE OF ACTION. (BRIEF TITLE: DBP VS. CASTILLO).

Filed under: LATEST SUPREME COURT CASES — 1 Comment

CASE 2011-0186: DEVELOPMENT BANK OF THE PHILIPPINES VS. HON. SILVERIO Q. CASTILLO and CRISTINA TRINIDAD ZARATE ROMERO (G.R. NO. 163827, 17 AUGUST 2011, VILLARAMA, JR., J.) SUBJECT: CAUSE OF ACTION. (BRIEF TITLE: DBP VS. CASTILLO).

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DISPOSITIVE:

WHEREFORE, the petition is DENIED for lack of merit. The Decision dated July 21, 2003 of the Court of Appeals in CA-G.R. SP No. 53825 is AFFIRMED.

No costs.

SO ORDERED.

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SUBJECT/DOCTRINE/DIGEST:

THE CASE STORY:

SIBLINGS CORAZON AND GONZALO CO-OWNED A REAL PROPERTY. THEY MORTGAGED THE PROPERTY TO DBP. FOR FAILURE TO PAY THE LOAN, DBP FORCLOSED THE MORTGAGE. CORAZON DIED. HER DAUGHTER CRISTINA FOUND OUT THAT THE PROPERTY IS ALREADY IN THE NAME OF DBP. SHE FILED A CASE FOR RECONVEYANCE ON THE GROUND THAT DBP AND GONZALO CONNIVED SO THE PROPERTY WILL BE OWNED SOLELY BY GONZALO. HER PROOFS: HER MOTHER WAS NOT INFORMED OF THE FORECLOSURE AND THUS WAS DEPRIVED OF HER RIGHT TO REDEEM; GONZALO EXECUTED BUY-BACK AGREEMENT WITH DBP OVER THE PROPERTY. SHE ASKED FOR TRO AND INJUNCTION TO PREVENT THE SALE OF THE PROPERTY AT PUBLIC AUCTION. DBP FILED MOTION TO DISMISS AND OPPOSED TRO AND INJUNCTION ON THE GROUND THAT THERE IS NO CAUSE OF ACTION BECAUSE WHEN CRISTINA BECAME HEIR THE PROPERTY WAS ALREADY IN THE NAME OF DBP. RTC GRANTED TRO AND LATER INJUNCTION AND DENIED MOTION TO DISMISS. DPB MOVED FOR RECON. RTC DENIED. DBP FILED AN ANSWER AD CAUTELAM AND ALSO FILED PETITIONS AT CA RE THE TRO, INJUNCTION AND DENIAL OF MOTION TO DISMISS. CA DENIED PETITIONS FOR BEING FILED OUT OF TIME. CA ALSO DENIED THE MOTION TO DISMISS FOR BEING MOOT BECAUSE DBP SUBSEQUENTLY FILED AN ANSWER.

WAS CA CORRECT IN DENYING THE PETITIONS FOR CERTIORARI RE TRO AND INJUNCTION?

YES, BECAUSE THE PETITIONS WERE FILED OUT OF TIME.

As correctly ruled by the CA, the petition for certiorari assailing the orders pertaining to the grant of the TRO and the writ of injunction were filed out of time. Notice of the issuance of the TRO was received by DBP on the same day it was granted, November 24, 1998; thus, the petition for certiorari should have been filed not later than January 23, 1999. The denial of the motion for reconsideration of the order granting the writ of injunction, on the other hand, was received by DBP on March 18, 1999 and thus, it had only until May 17, 1999 to file the petition for certiorari. DBP, however, filed its petition only on June 23, 1999.

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WAS THE DENIAL OF THE MOTION TO DISMISS CORRECT?

YES BUT NOT BECAUSE IT WAS MOOT BUT BECAUSE ITS WAS WITHOUT MERIT SINCE THE COMPLAINT OF CRISTINA STATES A CAUSE OF ACTION.

Evidently, all the above elements of a cause of action are alleged in the complaint: (1) the legal right of the respondent over the subject property foreclosed premised on the fact that she is the sole heir of one of the owners who is entitled to the right of redemption; (2) the correlative obligation of defendant DBP, as the foreclosing entity, to respect such right of redemption; and (3) the act or omission of the defendant in violation of the legal right, i.e., the act of DBP and its co-defendant Zarate to cause the ostensible foreclosure of the subject property and the subsequent execution of a deed of conditional sale between the defendants even prior to the lapse of redemption period to deprive respondent’s mother of her right over the property.

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WHAT IS CAUSE OF ACTION?

A CAUSE OF ACTION IS THE ACT OR OMISSION BY WHICH A PARTY VIOLATES A RIGHT OF ANOTHER.^{^[1]}^[24]

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WHEN DOES A COMPLAINT STATES A CAUSE OF ACTION?

WHEN IT CONTAINS THREE ESSENTIAL ELEMENTS:

(1) A RIGHT IN FAVOR OF THE PLAINTIFF BY WHATEVER MEANS AND WHATEVER LAW IT ARISES;

(2) THE CORRELATIVE OBLIGATION OF THE DEFENDANT TO RESPECT SUCH RIGHT; AND

(3) THE ACT OR OMISSION OF THE DEFENDANT VIOLATES THE RIGHT OF THE PLAINTIFF.

IF ANY OF THESE ELEMENTS IS ABSENT, THE COMPLAINT BECOMES VULNERABLE TO A MOTION TO DISMISS ON THE GROUND OF FAILURE TO STATE A CAUSE OF ACTION.^{^[2]}^[25]

A cause of action is the act or omission by which a party violates a right of another.^{^[3]}^[24] A complaint states a cause of action when it contains three essential elements: (1) a right in favor of the plaintiff by whatever means and whatever law it arises; (2) the correlative obligation of the defendant to respect such right; and (3) the act or omission of the defendant violates the right of the plaintiff. If any of these elements is absent, the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of action.^{^[4]}^[25]

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FIRST DIVISION

DEVELOPMENT BANK OF THE PHILIPPINES, Petitioner,

G.R. No. 163827 Present:

– versus –

CORONA, c.j.,

Chairperson,

LEONARDO-DE CASTRO,

BERSAMIN,

VILLARAMA, JR., and

SERENO,^* JJ.

HON. SILVERIO Q. CASTILLO and CRISTINA TRINIDAD ZARATE ROMERO, Respondents.

Promulgated: August 17, 2011

x – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – x

RESOLUTION

VILLARAMA, JR., J.:

Before us is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, seeking to set aside the July 21, 2003 Decision^{^[5]}^[1] of the Court of Appeals (CA) in CA-G.R. SP No. 53825 dismissing petitioner’s petition for certiorari.

The antecedents follow:

Corazon Zarate Romero and his brother Gonzalo Zarate co-owned a property covered by Transfer Certificate of Title (TCT) No. 10070^{^[6]}^[2] of the Register of Deeds of Dagupan City. The subject property, located inDagupanCity,Province ofPangasinan, is a 1,705-square-meter lot with a four-storey hotel erected thereon.

It appears that sometime in 1975, Corazon and Gonzalo obtained a loan from petitioner Development Bank of the Philippines (DBP). As collateral, they executed a real estate mortgage^{^[7]}^[3] over the subject property in favor of DBP. On the alleged failure of the two borrowers to pay their amortizations, DBP foreclosed the real estate mortgage onSeptember 15, 1983. Purportedly, no redemption was made within one year, and thus, DBP consolidated ownership over the subject property.

In March 1993, when Corazon passed away, her sole heir, her daughter respondent Cristina Trinidad Zarate Romero, asserted ownership over the subject property to the extent of one-half thereof. However, respondent discovered that the property was already registered as early as June 13, 1989in the name of DBP under TCT No. 54142,^{^[8]}^[4] with TCT No10070 in the names of her mother and uncle already cancelled.

Respondent filed before the Regional Trial Court (RTC) of DagupanCitya complaint^{^[9]}^[5] for reconveyance, quieting of title and damages with prayer for a temporary restraining order (TRO) and writ of preliminary injunction to prevent DBP from conducting any auction sale on the subject property during the pendency of the case. Respondent claimed that her uncle and DBP conspired in committing fraudulent acts relative to their true transaction and concealed the same from her mother, thereby depriving her of her right of redemption.

The RTC, after hearing, issued on November 24, 1998, a TRO^{^[10]}^[6] restraining DBP from proceeding with its scheduled auction of the disputed property onNovember 25, 1998. The dispositive portion of the trial court’s order reads:

It appearing that plaintiff Cristina Trinidad Romero y Zarate is the sole heir of the late Maria Corazon Zarate Romero[,] co-owner of the ½ pro[-]indiviso of the property covered by TCT No. 10070 which at present is carried in TCT No.54142 inthe name of DBP[,] and to avoid irreparable damage that may arise [from] the auction sale (public bidding) scheduled on November 25, 1998[,] this Court hereby issues a Temporary Restraining Order (TRO) AGAINST DEFENDANT Development Bank of the Philippines, Makati, Metro Manila from proceeding [with] the scheduled auction sale (public bidding) on November 25, 1998 at defendant’s head office at SAM BCG for a period of twenty (20) days from receipt of this order.

SO ORDERED.^{^[11]}^[7]

DBP moved to lift the TRO arguing that it violates Section 2^{^[12]}^[8] of Presidential Decree (P.D.) No. 385^{^[13]}^[9] which prohibits the issuance of a restraining order, temporary or permanent, against government financing institutions like DBP to enjoin any action taken pursuant to the mandatory foreclosure clause of the decree.^{^[14]}^[10]

On December 14, 1998, the RTC denied DBP’s motion to lift the TRO and granted respondent’s plea for an injunctive writ.^{^[15]}^[11] The pertinent portions of the trial court’s order reads:

To the honest evaluation of this Court what is unrestrainable is the right of government financial institutions to foreclose mandatorily all loans with arrearages including interest and charges amounting to at least twenty (20%) percent of the total outstanding obligation.

x x x x

To allay the fears of the plaintiff and to avoid any irreparable damage that may arise while the issues involved in the above case are still being resolved and determined by the Court in the light of the evidence so f[a]r presented, [considering that] there is a tendency on the part of the Development Bank of the Philippines of continuing the acts complained of (auction sale/Public bidding) and considering further [that] there [should] be no advantage … given to one [party] to the prejudice of the other while this case is still pending in Court, it is hereby ordered that a WRIT of Preliminary Injunction be issued against defendant Development Bank of the Philippines from conducting any auction sale of the property involved in the above case (formerly covered by TCT No. 10070 and at [present] covered by TCT No. 54142), upon posting of a BOND by the plaintiff in the amount of P3 Million within five (5) days from receipt of this Order.^{^[16]}^[12]

On even date, DBP moved to reconsider^{^[17]}^[13] the December 14, 1998 Order and at the same time sought the dismissal of respondent’s complaint on the sole ground that the same states no cause of action.^{^[18]}^[14]

On December 23, 1998, the writ of preliminary injunction^{^[19]}^[15] was issued in favor of respondent.

On March 8, 1999, the RTC denied DBP’s motion for reconsideration of the denial of its motion for the lifting of the TRO. The RTC likewise denied in the same order DBP’s motion to dismiss the complaint,^{^[20]}^[16] and ordered DBP to file an answer.

On March 23, 1999, DBP moved to reconsider the March 8, 1999denial of its motion to dismiss.^{^[21]}^[17] But even before the RTC could resolve said motion, DBP filed its Answer^{^[22]}^[18] on April 5, 1999. A manifestation^{^[23]}^[19] was later filed by DBP indicating that the answer it filed was a mere cautionary measure or what is known as an answer ad cautelam and thus without prejudice to any right of action it may take and without any waiver of any of the grounds for the dismissal of the complaint and any favorable resolution or order that a superior court may issue hereinafter.

On April 20, 1999, the RTC issued an order^{^[24]}^[20] denying DBP’s motion for reconsideration of itsMarch 8, 1999 Order. The RTC in the same order emphasized that DBP already filed an answer thereby rendering the motion to dismiss moot and academic.

On June 23, 1999, DBP filed a petition for certiorari^{^[25]}^[21] before the CA assailing the following issuances of the RTC:

(1) TRO datedNovember 24, 1998(received by DBP onNovember 24, 1998) issued against DBP enjoining it from proceeding with the scheduled auction sale of the disputed property;

(2) Order datedDecember 14, 1998(received by DBP onDecember 16, 1998) denying its motion to lift the TRO and granting the respondents’ prayer for a writ of preliminary injunction;

(3) Order datedMarch 8, 1999(received by DBP onMarch 18, 1999) denying DBP’s motion to dismiss and motion for reconsideration of theDecember 14, 1998Order; and

(4) Order datedApril 20, 1999(received by DBP onApril 23, 1999) denying DBP’s motion for reconsideration of theMarch 8, 1999order.

In its assailed decision, the CA dismissed the petition on procedural grounds. It held that the petition questioning the first three orders was filed late as the petition should have been filed within 60 days from receipt of the assailed orders. The CA noted that as regards the third order, DBP was notified of the denial of its motion for reconsideration of the December 14, 1998 Order on March 18, 1999 and thus only had until May 17, 1999 to question the same. The CA further stated that DBP’s subsequent filing of its Answer to the complaint rendered its motion to dismiss moot and academic.

Hence, the present appeal.

DBP raises the following issues for this Court’s consideration:

I. WHETHER … THE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE ORDER OF THE COURT A QUO … DENYING DBP’S MOTION TO DISMISS….

II. WHETHER … THE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE ORDER OF THE COURT A QUO … ISSUING THE TEMPORARY RESTRAINING ORDER AND THE PRELIMINARY INJUNCTION AGAINST PETITIONER DBP.

III. WHETHER … THE RULES OF PROCEDURE [SHOULD NOT] BE APPLIED IN A VERY RIGID AND TECHNICAL SENSE SO AS NOT TO FRUSTRATE THE PROMOTION OF SUBSTANTIAL JUSTICE.^{^[26]}^[22]

DBP insists that it is evident from the face of the complaint that respondent failed to state a cause of action. DBP contends that respondent’s allegation of conspiracy between DBP and Gonzalo is bare and has no factual basis to stand on. Further, DBP claims that respondent has no legal right over the subject property as she did not inherit the same in the first place. At the time of death of respondent’s mother, the property was not anymore owned by the latter and therefore not part of her estate. Thus, respondent has no legal right over the property and has no cause of action against DBP. And because she had no right to the property, the issuance of the TRO and injunctive writ were likewise improper. DBP also points to the following provisions of P.D. No. 385 that were allegedly violated with the issuance of the TRO and injunctive writ:

Section 1. It shall be mandatory for government financial institutions, after the lapse of sixty (60) days from the issuance of this Decree, to foreclose the collaterals and/or securities for any loan, credit, accommodation, and/or guarantees granted by them whenever the arrearages on such account, including accrued interest and other charges, amount to at least twenty percent (20%) of the total outstanding obligations, including interest and other charges, as appearing in the books of account and/or related records of the financial institution concerned. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective contracts with their debtors, including the right to foreclose on loans, credits, accommodations and/or guarantees on which the arrearages are less than twenty percent (20%).

Sec. 2. No restraining order, temporary or permanent injunction shall be issued by the court against any government financial institution in any action taken by such institution in compliance with the mandatory foreclosure provided in Section 1 hereof, whether such restraining order, temporary or permanent injunction is sought by the borrower(s) or any third party or parties, except after due hearing in which it is established by the borrower and admitted by the government financial institution concerned that twenty percent (20%) of the outstanding arrearages has been paid after the filing of foreclosure proceedings.

x x x x

Respondent, for her part, counters that the CA was correct in dismissing the petition for certiorari for having been filed beyond the sixty (60)-day reglementary period. Also, respondent contends that the provisions of P.D. No. 385 relating to the proscription against the issuance of injunctive writs enjoining foreclosure sales are not applicable in the instant case. She points out that what the RTC enjoined is not an auction sale arising from the foreclosure of mortgage as the subject property had long been foreclosed and title thereto consolidated in the name of DBP. Rather, what the RTC enjoined was DBP’s sale of the subject property through ordinary public bidding which is not within the ambit of P.D. No. 385.

The petition should be denied.

As correctly ruled by the CA, the petition for certiorari assailing the orders pertaining to the grant of the TRO and the writ of injunction were filed out of time. Notice of the issuance of the TRO was received by DBP on the same day it was granted,November 24, 1998; thus, the petition for certiorari should have been filed not later thanJanuary 23, 1999. The denial of the motion for reconsideration of the order granting the writ of injunction, on the other hand, was received by DBP on March 18, 1999 and thus, it had only until May 17, 1999 to file the petition for certiorari. DBP, however, filed its petition only onJune 23, 1999.

As to DBP’s motion to dismiss the complaint, we agree with the RTC and CA that the same should be denied, but not for the reason cited by said courts that it has been rendered moot and academic by DBP’s filing of its answer but because the same lacks merit. Contrary to DBP’s submission, a perusal of the allegations of the complaint clearly reveals respondent’s cause of action against DBP. The complaint states,

x x x x

1.1 Plaintiff is the sole heir and successor-in-interest of the late Ma. Corazon Zarate-Romero, who died intestate on6 March 1993.

x x x x

3. During her lifetime, plaintiff’s predecessor-in-interest was the erstwhile owner pro-indiviso of that parcel of land, together with improvements, located in Dagupan City, which property used to be covered by Transfer Certificate of Title (TCT) No. 10070 of the Registry of Deeds of Dagupan City….

4. In or about the year 1975, defendant Zarate, who was co-owner of the subject property, secured various personal loan obligations from the defendant DBP in the aggregate amount of P2,000,000.00.

4.1 To secure such putative loan obligations of the defendant Zarate, the latter, who wielded moral ascendancy over his younger sister and herein plaintiff’s predecessor-in-interest — Ma. Corazon Zarate-Romero, cajoled and prevailed upon the latter to mortgage the entirety of the subject property in favor of defendant DBP, including her one-half (1/2) pro-indiviso share in the same.

4.2 Accordingly, defendant Zarate assured the plaintiff’s predecessor-in-interest that the mortgage would be for a brief period only and that he (defendant Zarate) would forthwith pay and settle in full all his personal loan obligations with the defendant DBP to ensure that said mortgage is cancelled in the soonest time possible.

5. At some point in time during the effectivity of the mortgage, however, defendant Zarate apparently saw an opportunity to claim the entirety of the subject property for himself, to the exclusion of plaintiff’s predecessor-in-interest.

5.1 Emboldened by, and taking advantage of, the complete trust and confidence reposed upon him by the plaintiff’s predecessor-in-interest anent the subject property, defendant Zarate conspired with the defendant DBP for the ostensible foreclosure of the subject property, with the end in view, however, of subsequently reacquiring the same for himself as sole owner.

6. Pursuant to such sinister plot hatched by defendants, defendant DBP foreclosed the subject property in September of 1983 and, thereafter, bought the same for itself in the sum of P2,253,101.00 during the auction sale conducted by the Deputy Sheriff of Pangasinan….

7. Significantly enough, and even before the lapse of the mortgagors’ right of redemption over the subject property, the herein defendants entered into a Deed of Conditional Sale over the same, with the defendant DBP as seller, and the defendant Zarate as buyer….

7.1 Needless to state, all the aforedescribed dealings, transactions and proceedings concerning the subject property — from its fraudulent foreclosure up to the highly anomalous execution of the Deed of Conditional Sale over the same — were concealed from plaintiff’s predecessor-in-interest and even from the plaintiff herself after the death of her mother.

x x x x^{^[27]}^[23]

A cause of action is the act or omission by which a party violates a right of another.^{^[28]}^[24] A complaint states a cause of action when it contains three essential elements: (1) a right in favor of the plaintiff by whatever means and whatever law it arises; (2) the correlative obligation of the defendant to respect such right; and (3) the act or omission of the defendant violates the right of the plaintiff. If any of these elements is absent, the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of action.^{^[29]}^[25]

WHEREFORE, the petition is DENIED for lack of merit. The Decision dated July 21, 2003 of the Court of Appeals in CA-G.R. SP No. 53825 is AFFIRMED.

No costs.

SO ORDERED.

MARTIN S. VILLARAMA, JR.

Associate Justice

WE CONCUR:

RENATO C. CORONA

Chief Justice

Chairperson

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

LUCAS P. BERSAMIN

Associate Justice

MARIA LOURDES P. A. SERENO

Associate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the 1987 Constitution, I certify that the conclusions in the above Resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA

Chief Justice

[1][24] Section 2, Rule 2, 1997 Rules of Civil Procedure, as amended.

[2][25] See Heirs of Loreto C. Maramag v. Maramag, G.R. No. 181132, June 5, 2009, 588 SCRA 774, 784 and Bank of America NT & SA v. Court of Appeals, G.R. No. 120135,March 31, 2003, 400 SCRA 156, 167.

[3][24] Section 2, Rule 2, 1997 Rules of Civil Procedure, as amended.

[4][25] See Heirs of Loreto C. Maramag v. Maramag, G.R. No. 181132, June 5, 2009, 588 SCRA 774, 784 and Bank of America NT & SA v. Court of Appeals, G.R. No. 120135,March 31, 2003, 400 SCRA 156, 167.

* Designated additional member per Raffle datedAugust 8, 2011 in lieu of Associate Justice Mariano C. Del Castillo who recused himself due to prior action in the Court of Appeals.

[5][1] Rollo, pp. 36-46. Penned by Presiding Justice Cancio C. Garcia (now a retired member of this Court) with Associate Justices Eloy R. Bello, Jr. and Mariano C. Del Castillo (now a member of this Court) concurring.

[6][2] CA rollo, pp. 69-72.

[7][3] Id. at 105-117.

[8][4] Id. at 118-119.

[9][5] Id. at 57-68.

[10][6]Id. at 38-41.

[11][7]Id. at 41.

[12][8] Sec. 2. No restraining order, temporary or permanent injunction shall be issued by the court against any government financial institution in any action taken by such institution in compliance with the mandatory foreclosure provided in Section 1 hereof, whether such restraining order, temporary or permanent injunction is sought by the borrower(s) or any third party or parties, except after due hearing in which it is established by the borrower and admitted by the government financial institution concerned that twenty percent (20%) of the outstanding arrearages has been paid after the filing of foreclosure proceedings.

In case a restraining order or injunction is issued, the borrower shall nevertheless be legally obligated to liquidate the remaining balance of the arrearages, paying ten percent (10%) of the arrearages outstanding as of the time of foreclosure, plus interest and other charges, on every succeeding thirtieth (30^th) day after the issuance of such restraining order or injunction until the entire arrearages have been liquidated. These shall be in addition to the payment of amortizations currently maturing. The restraining order or injunction shall automatically be dissolved should the borrower fail to make any of the above-mentioned payments on due dates, and no restraining order or injunction shall be issued thereafter. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective charters and their respective contracts with their debtors, nor should this provision be construed as restricting the government financial institutions concerned from approving, solely at its own discretion, any restructuring, recapitalization, or any other arrangement that would place the entire account on a current basis, provided, however, that at least twenty percent (20%) of the arrearages outstanding at the time of the foreclosure is paid.

All restraining orders and injunctions existing as of the date of this Decree on foreclosure proceedings filed by said government financial institutions shall be considered lifted unless finally resolved by the court within sixty (60) days from date hereof.

[13][9] Requiring Government Financial Institutions to Foreclose Mandatorily All Loans with Arrearages, Including Interest and Charges, Amounting to at least Twenty Percent (20%) of the Total Outstanding Obligation.

[14][10] CA rollo, pp. 93-104.

[15][11] Id. at 42-53.

[16][12] Id. at 49, 53.

[17][13] Id. at 139-150.

[18][14] Id. at 130-136.

[19][15] Id. at 137-138.

[20][16] Id. at 54-55.

[21][17] Id. at 169-176.

[22][18] Id. at 177-182.

[23][19] Id. at 183-184.

[24][20] Id. at 56.

[25][21] Id. at 12-37.

[26][22] Rollo, p. 286.

[27][23] CA rollo, pp. 57-60.

[28][24] Section 2, Rule 2, 1997 Rules of Civil Procedure, as amended.

[29][25] See Heirs of Loreto C. Maramag v. Maramag, G.R. No. 181132, June 5, 2009, 588 SCRA 774, 784 and Bank of America NT & SA v. Court of Appeals, G.R. No. 120135,March 31, 2003, 400 SCRA 156, 167.

Comment

CASE 2011-0185: ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop VS. EDUARDO SORIANO, JR., EDNA YALUN, EVANGELINA ABLAZA, FELICIDAD Y. URBINA, FELIX SALENGA, REYNALDO I. MALLARI, MARCIANA B. BARCOMA, BIENVENIDO PANGANIBAN, BRIGIDA NAVARRO, EUFRANCIA T. FLORES, VICTORIA B. SUDSOD, EUFRONIO CAPARAS, CRISANTO MANANSALA, LILY MASANGCAY, BENJAMIN GUINTO, JR., MARTHA G. CASTRO and LINO TOLENTINO (G.R. NO. 153829); BENJAMIN GUINTO, JR. VS. ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop (G.R. NO. 160909) (17 AUGUST 2011, VILLARAMA, JR., J.) SUBJECTS: MOTION TO DISMISS; COLATERAL AND DIRECT ATTACKS; MISJOINDER OF CAUSES OF ACTION; INJUNCTION. (BRIEF TITLE: ROMAN CATHOLIC ARCH. VS. SORIANO)

Filed under: LATEST SUPREME COURT CASES — 1 Comment

August 25, 2011

CASE 2011-0185: ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop VS. EDUARDO SORIANO, JR., EDNA YALUN, EVANGELINA ABLAZA, FELICIDAD Y. URBINA, FELIX SALENGA, REYNALDO I. MALLARI, MARCIANA B. BARCOMA, BIENVENIDO PANGANIBAN, BRIGIDA NAVARRO, EUFRANCIA T. FLORES, VICTORIA B. SUDSOD, EUFRONIO CAPARAS, CRISANTO MANANSALA, LILY MASANGCAY, BENJAMIN GUINTO, JR., MARTHA G. CASTRO and LINO TOLENTINO (G.R. NO. 153829); BENJAMIN GUINTO, JR. VS. ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop (G.R. NO. 160909) (17 AUGUST 2011, VILLARAMA, JR., J.) SUBJECTS: MOTION TO DISMISS; COLATERAL AND DIRECT ATTACKS; MISJOINDER OF CAUSES OF ACTION; INJUNCTION. (BRIEF TITLE: ROMAN CATHOLIC ARCH. VS. SORIANO)

==========================

DISPOSITIVE:

WHEREFORE, the petition in G.R. No. 153829 is DENIED. The Decision dated March 18, 2002 and the Resolution dated May 30, 2002 of the Court of Appeals in CA-G.R. SP No. 66974 are AFFIRMED. The motion for the issuance of a TRO and/or writ of preliminary injunction to enjoin the sheriff from enforcing the writ of execution in Civil Case No. 2000(23) is likewise DENIED for lack of merit.

No costs.

SO ORDERED.

==========================

SUBJECT/DOCTRINE/DIGEST:

RESPONDENTS FILED CASE AGAINST ROMAN CATHOLIC ARCHBISHOP (RCA) OF SAN FERNANDO FOR QUIETING OF TITLE. RCA FILED MOTION TO DISMISS. RTC DENIED. CA UPHELD RTC. RCA FILED PETITION FOR CERTIORARI. IS CERTIORARI THE PROPER REMEDY?

NO. THE DISMISSAL OF A MOTION TO DISMISS CANNOT BE QUESTIONED IN A CERTIORARI PROCEEDING.

XXXXXXXXXXXXXXX

WHY?

BECAUSE CERTIORARI WRIT IS A REMEDY TO CORRECT ERROR OF JURISDICTION AND NOT ERROR OF JUDGMENT.

XXXXXXXXXXXXXXXX

WHAT IS THE APPROPRIATE COURSE OF ACTION?

TO FILE AN ANSWER AND INTERPOSE AS AFFIRMATIVE DEFENSE THE OBJECTIONS RAISED IN THE MOTION TO DISMISS.

Well-entrenched in our jurisdiction is the rule that the trial court’s denial of a motion to dismiss cannot be questioned in a certiorari proceeding under Rule 65 of the 1997 Rules of Civil Procedure, as amended. This is because a certiorari writ is a remedy designed to correct errors of jurisdiction and not errors of judgment. The appropriate course of action of the movant in such event is to file an answer and interpose as affirmative defenses the objections raised in the motion to dismiss. If, later, the decision of the trial judge is adverse, the movant may then elevate on appeal the same issues raised in the motion.^{^[1]}^[27]

XXXXXXXXXXXXXXXXXXXXXX

IS THERE AN EXCEPTION TO THE RULE THAT MOTION TO DISMISS CANNOT BE QUESTIONED ON CERTIORARI?

YES. WHEN THE TRIAL COURT GRAVELY ABUSED ITS DISCRETION IN DENYING THE MOTION.^{^[2]}^[28] THIS EXCEPTION IS, NEVERTHELESS, APPLIED SPARINGLY, AND ONLY IN INSTANCES WHEN THERE IS A CLEAR SHOWING THAT THE TRIAL COURT EXERCISED ITS JUDICIAL POWER IN AN ARBITRARY OR DESPOTIC MANNER BY REASON OF PASSION OR PERSONAL HOSTILITY.

The only exception to this rule is when the trial court gravely abused its discretion in denying the motion.^{^[3]}^[28] This exception is, nevertheless, applied sparingly, and only in instances when there is a clear showing that the trial court exercised its judicial power in an arbitrary or despotic manner by reason of passion or personal hostility.^{^[4]}^[29] Further, the abuse of the court’s discretion must be so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform the duty enjoined by, or to act at all in contemplation of, law.^{^[5]}^[30]

Here, in dismissing the petition for certiorari, the CA did not find grave abuse of discretion on the part of the RTC. The appellate court was not convinced with the RCA’s argument that plaintiffs failed to comply with the condition precedent provided in Article 477^{^[6]}^[31] of the Civil Code because they allegedly did not have legal or equitable title to, or interest in the real property. The CA explained that the requirement stated in Article 477 is not a condition precedent before one can file an action for quieting of title. Rather, it is a requisite for an action to quiet title to prosper and the existence or nonexistence of the requisite should be determined only after trial on the merits. The CA also agreed with the trial court in ruling that the RCA cannot raise in a motion to dismiss the ground that the complaint is already barred by laches for it still remains to be established during trial how long the plaintiffs have slept on their rights, if such be the case. Evidently, the CA is correct in finding that the denial by the RTC of the RCA’s motion to dismiss is not tainted with grave abuse of discretion.

XXXXXXXXXXXXXXXXXXXXX

RCA ARGUES THAT THERE IS MISJOINDER OF CAUSES OF ACTION BECAUSE QUIETING OF TITLE IS SPECIAL CIVIL ACTION WHILE DECLARATION OF NULLITY IS GOVERNED BY ORDINARY RULES. BOTH RELIEFS ARE BEING SOUGHT BY RESPONDENTS. THEREFORE THE CASE SHOULD HAVE BEEN DISMISSED. IS RCA CORRECT?

NO. SECTION 6 OF RULE 2 EXPLICITLY PROVIDES THAT MISJOINDER OF CAUSES OF ACTION IS NOT A GROUND FOR DISMISSAL OF AN ACTION.

Next, the RCA submits that an action for quieting of title is a special civil action covered by Rule 63, while an action for declaration of nullity of title is governed by ordinary rules. Thus, it contends that these cases should have been dismissed for violation of the rule on joinder of actions under Section 5, Rule 2 of the 1997 Rules of Civil Procedure, as amended, which requires that the joinder shall not include special civil actions governed by special rules. Such contention, however, is utterly bereft of merit and insufficient to show that the CA erred in upholding the trial court’s decision. Section 6 of Rule 2 explicitly provides that misjoinder of causes of action is not a ground for dismissal of an action.

XXXXXXXXXXXXXXXXXXX

RCA ASSERTS THAT QUIETING OF TITLE IS COLLATERAL ATTACK ON ITS TITLE PROHIBITED BY LAW. IS RCA CORRECT?

NO. THE ACTION FOR THE DECLARATION OF NULLITY OF OCT NO. 17629 IS A CLEAR AND DIRECT ATTACK ON THE TITLE.

The RCA likewise asserts that the case for quieting of title is a collateral attack on its title which is prohibited by law. However, we agree with the CA in holding that the complaint against the RCA does not amount to a collateral attack because the action for the declaration of nullity of OCT No. 17629 is a clear and direct attack on its title.

XXXXXXXXXXXXXXXXXXXXXX

WHEN IS THERE DIRECT ATTACK?

WHEN THE OBJECTIVE IS TO ANNUL OR SET ASIDE SUCH JUDGMENT, OR ENJOIN ITS ENFORCEMENT.

X XXXXXXXXXXXXXXXXXXXX

WHEN IS AN ATTACK ON TITLE COLLATERAL?

WHEN THE ATTACK IS ONLY AN INCIDENT IN A CASE PRAYING FOR A DIFFERENT RELIEF.

An action is deemed an attack on a title when its objective is to nullify the title, thereby challenging the judgment pursuant to which the title was decreed. The attack is direct when the objective is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment is nevertheless made as an incident thereof.^{^[7]}^[32]

The complaint filed with the RTC pertinently alleged that the claim of ownership by the RCA is spurious as its title, denominated as OCT No. 17629, is fake for the following reasons: (1) that the erasures are very apparent and the title itself is fake; (2) it was made to appear under Memorandum of Encumbrance Entry No. 1007 that the title is a reconstituted title when in truth, it is not; and (3) the verification reveals that there was no petition filed before any court where an order was issued for the reconstitution and re-issuance of an owner’s duplicate copy.^{^[8]}^[33] It is thus clear from the foregoing that the case filed questioning the genuineness of OCT No. 17629 is a direct attack on the title of the RCA.

XXXXXXXXXXXXXXXXXXX

RCA WON EJECTMENT CASE. PETITIONER GUINTO PRAYS FOR PRELIMINARY INJUNCTION TO PREVENT THE SHERIFF FROM ENFORCING EJECTMENT WRIT. IS THERE BASIS FOR PRELIM INJUNCTION?

NO. THEIR RIGHT TO POSSESSION HAS BEEN DECLARED INFERIOR TO THAT OF RCA BY THE MTC DECISION AND SUCH DECISION HAS BECOME FINAL.

As regards the petition docketed as G.R. No. 160909 which this Court treated as motion for the issuance of a TRO and/or writ of preliminary injunction, Guinto insists that there is a need to enjoin the sheriff from enforcing the writ of execution as it would cause grave and irreparable damage to Guinto, while the RCA would not suffer any damage if it would later be proved that indeed its title is genuine.

We disagree.

Section 3, Rule 58 of the 1997 Rules of Civil Procedure, as amended, enumerates the grounds for the issuance of preliminary injunction, viz:

SEC. 3. Grounds for issuance of preliminary injunction. – A preliminary injunction may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually;

(b) That the commission, continuance or nonperformance of the act or acts complained of during the litigation would probably work injustice to the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.

And as clearly explained in Ocampo v. Sison Vda. de Fernandez:^{^[9]}^[34]

To be entitled to the injunctive writ, the applicant must show that there exists a right to be protected which is directly threatened by an act sought to be enjoined. Furthermore, there must be a showing that the invasion of the right is material and substantial and that there is an urgent and paramount necessity for the writ to prevent serious damage. The applicant’s right must be clear and unmistakable. In the absence of a clear legal right, the issuance of the writ constitutes grave abuse of discretion. Where the applicant’s right or title is doubtful or disputed, injunction is not proper. The possibility of irreparable damage without proof of an actual existing right is not a ground for injunction.

A clear and positive right especially calling for judicial protection must be shown. Injunction is not a remedy to protect or enforce contingent, abstract, or future rights; it will not issue to protect a right not in esse and which may never arise, or to restrain an act which does not give rise to a cause of action. There must exist an actual right. There must be a patent showing by the applicant that there exists a right to be protected and that the acts against which the writ is to be directed are violative of said right.

In this case, the defendants in the ejectment case possess no such legal rights that merit the protection of the courts through the writ of preliminary injunction. The MCTC has already rendered a decision in favor of the RCA and ordered the defendants therein to vacate the premises. Their appeal to the RTC was dismissed and the decision has become final. Evidently, their right to possess the property in question has already been declared inferior or inexistent in relation to the right of the RCA in the MCTC decision which has already become final and executory.^{^[10]}^[35]

==========================

FIRST DIVISION

ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop, Petitioner,

– versus –

G.R. No. 153829

EDUARDO SORIANO, JR., EDNA YALUN, EVANGELINA ABLAZA, FELICIDAD Y. URBINA, FELIX SALENGA, REYNALDO I. MALLARI, MARCIANA B. BARCOMA, BIENVENIDO PANGANIBAN, BRIGIDA NAVARRO, EUFRANCIA T. FLORES, VICTORIA B. SUDSOD, EUFRONIO CAPARAS, CRISANTO MANANSALA, LILY MASANGCAY, BENJAMIN GUINTO, JR., MARTHA G. CASTRO and LINO TOLENTINO, Respondents.

x- – – – – – – – – – – – – – – – – – – – – – – – – – – – -x

BENJAMIN GUINTO, JR.,^{^[11]}^[1] Petitioner,

– versus –

G.R. No. 160909 Present: CORONA, C.J.,

Chairperson,

LEONARDO-DE CASTRO,

BERSAMIN,

DELCASTILLO, and

VILLARAMA, JR., JJ.

ROMAN CATHOLIC ARCHBISHOP OF SAN FERNANDO, PAMPANGA represented herein by the incumbent Archbishop, Respondent.

Promulgated: August 17, 2011

x- – – — – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – -x

DECISION

VILLARAMA, JR., J.:

Before this Court are two petitions for resolution: the first, a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, filed by the Roman Catholic Archbishop (RCA) of San Fernando, Pampanga, assailing the March 18, 2002 Decision^{^[12]}^[2] and the May 30, 2002 Resolution^{^[13]}^[3] of the Court of Appeals (CA) in CA-G.R. SP No. 66974; and the second, a Petition for Injunction under Rule 58, filed by Benjamin Guinto, Jr. (Guinto), seeking to enjoin the implementation of the Writ of Execution^{^[14]}^[4] dated October 14, 2003, issued by the Municipal Circuit Trial Court (MCTC) of Macabebe-Masantol, Pampanga in Civil Case No. 2000(23).

The facts follow:

The RCA of San Fernando, Pampanga, represented by Most Rev. Paciano B. Aniceto, D.D., claimed that it is the owner of a vast tract of land located near the Catholic Church at Poblacion, Macabebe, Pampanga and covered by Original Certificate of Title (OCT) No. 17629 issued by the Registry of Deeds of San Fernando on February 21, 1929.^{^[15]}^[5] The RCA alleged that several individuals unlawfully occupied the subject land and refused to vacate despite repeated demands. Having no other recourse, the RCA filed an ejectment case, docketed as Civil Case No. 2000(23), before the MCTC of Macabebe-Masantol, Pampanga against the alleged intruders, namely, Leocadio and Rufina Reyes, Jose Balagtas, Marcial and Victoria Balagtas, Levita Naluz, Dionisio Barcoma, Felicidad Urbina, Justiniano Reyes, Lawrence Muniz, Eduardo Soriano, Cosmer Vergara, Perlita Bustos, Brigida Navarro, Leonoda Cruz, Leonida Manansala, Angelito Juliano, Eduardo Ibay, Edna Yalung, Reynaldo Mallari, Lily Masangcay, Evangelina Ablaza, Crisanto Manansala, Feliza Esguerra, Gloria Manansala, Bienvenido and Felicisima Panganiban, Ofroneo Caparas, Tino Enriquez, Elizabeth and Benjamin Guinto, Felix Salenga, Eleno and Rosala Salenga, Luisa and Domingo Sison, Francia Flores, Eduardo and Rosita Gutierrez, Zosima and Ener Basilio, Andy and Loreto Bonifacio, Peter and Felicisima Villajuan.^{^[16]}^[6]

On the other hand, defendants countered that the RCA has no cause of action against them because its title is spurious. They contended that the subject land belonged to the State, but they have already acquired the same by acquisitive prescription as they and their predecessors-in-interest have been in continuous possession of the land for more than thirty (30) years.

After considering the pleadings submitted by the parties, the MCTC rendered decision on September 28, 2001 in favor of the RCA. The trial court held that OCT No. 17629 in the name of the RCA remains valid and binding against the whole world until it is declared void by a court of competent jurisdiction. Thus, defendants were ordered to vacate the premises and to pay reasonable monthly rentals from August 15, 2000 until they shall have finally vacated the premises.^{^[17]}^[7]

Defendants appealed to the Regional Trial Court (RTC). However, the appeal was dismissed because of their failure to file the appeal memorandum. When defendants elevated the case to the CA, their petition for certiorari was not given due course for failure to file the same within the extended period. Hence, the decision ejecting the defendants from the premises became final.

Pursuant to Section 21,^{^[18]}^[8] Rule 70 of the 1997 Rules of Civil Procedure, as amended, the RCA filed an Urgent Motion for Immediate Issuance of a Writ of Execution, which the MCTC granted in an Order^{^[19]}^[9] dated February 10, 2003, as follows:

WHEREFORE, on the basis of the rules and jurisprudence aforecited, the Motion for Execution filed by plaintiff is hereby granted. Let a writ of execution be issued in connection with this case which is a ministerial duty of the Court.

Defendants’ Motion for Inhibition is denied for lack of merit.

SO ORDERED.^{^[20]}^[10]

Thereafter, the MCTC issued another Order dated October 6, 2003, the pertinent portion of which states:

Let a writ of execution be issued to implement the Decision dated September 28, 2001.

No further defendants’ motion to stay execution shall be entertained.

SO ORDERED.^{^[21]}^[11]

Accordingly, a writ of execution^{^[22]}^[12] was issued commanding the sheriff or his deputies to implement the MCTC Decision. Thus, Sheriff Edgar Joseph C. David sent the defendants a Notice to Vacate^{^[23]}^[13] dated December 8, 2003.

Seeking to enjoin the implementation of the writ of execution and the notice to vacate, Guinto filed the instant Petition for Injunction with Prayer for Issuance of a Temporary Restraining Order (TRO),^{^[24]}^[14] docketed as G.R. No. 160909.

Meanwhile, during the pendency of the ejectment case at the MCTC, some of the defendants therein, namely, Eduardo Soriano, Jr., Edna Yalun, Evangelina Ablaza, Felicidad Y. Urbina, Felix Salenga, Reynaldo I. Mallari, Marciana B. Barcoma, Bienvenido Panganiban, Brigida Navarro, Eufrancia T. Flores, Victoria B. Sodsod, Eufronio Caparas, Crisanto Manansala, Lily Masangcay, Benjamin Guinto, Jr., Martha G. Castro and Lino Tolentino filed Civil Case No. 01-1046(M) against the RCA for Quieting of Title and Declaration of Nullity of Title before the RTC of Macabebe, Pampanga.^{^[25]}^[15] They claimed that they are in actual possession of the land in the concept of owners and alleged that OCT No. 17629 in the name of RCA is spurious and fake.

Before filing its Answer, the RCA moved to dismiss the case on grounds of noncompliance with a condition precedent, laches, and for being a collateral attack on its title. The RCA likewise later filed a supplement to its motion to dismiss.

In an Order^{^[26]}^[16] dated June 4, 2001, the RTC denied the motion to dismiss reasoning that when the rules speak of noncompliance with a condition precedent, it could refer only to the failure of a party to secure the appropriate certificate to file action under the Local Government Code, or the failure to exert earnest efforts towards an amicable settlement when the suit involves members of the same family. The RTC also found that plaintiffs have a cause of action. Furthermore, the trial court held that RCA’s argument – that the property cannot be acquired by prescription because it has title over it – is a matter of evidence which may be established during the trial on the merits.

Aggrieved, the RCA filed a motion for reconsideration, which the trial court denied in an Order^{^[27]}^[17] dated July 24, 2001. Thereafter, the RCA filed with the CA a petition for certiorari with prayer for preliminary injunction.^{^[28]}^[18]

On March 18, 2002, the CA promulgated the assailed Decision,^{^[29]}^[19] the dispositive portion of which reads:

WHEREFORE, for lack of merit, the petition is hereby DISMISSED.

SO ORDERED.^{^[30]}^[20]

A motion for reconsideration^{^[31]}^[21] of the Decision was filed by the RCA. However, in the Resolution^{^[32]}^[22] dated May 30, 2002, the CA denied the motion for lack of merit. Hence, the RCA filed the present petition for review on certiorari,^{^[33]}^[23] docketed as G.R. No. 153829, assailing the Decision of the CA, as well as its Resolution denying the motion for reconsideration.

On January 14, 2004, we resolved to consolidate G.R. Nos. 160909 and 153829.^{^[34]}^[24] Subsequently, the Court resolved to treat the petition for injunction with prayer for the issuance of a TRO in G.R. No. 160909 as a motion for the issuance of a TRO and/or writ of preliminary injunction in G.R. No. 153829.^{^[35]}^[25]

The RCA raises the following issues:

(A) WHETHER OR NOT CIVIL CASE NO. 01-1046(M) FOR QUIETING OF TITLE AND DECLARATION OF NULLITY OF TITLE IS LEGALLY DISMISSIBLE FOR VIOLATION OF THE VARIOUS PROVISIONS OF THE RULES OF COURT;

and

(B) WHETHER OR NOT THE CIVIL ACTION (THE ABOVE MENTIONED CIVIL CASE NO. 01-1046[M]) FILED BY PRIVATE RESPONDENTS CONSTITUTES A COLLATERAL ATTACK ON PETITIONER’S TITLE.^{^[36]}^[26]

Essentially, the issue before us is whether the CA erred in not holding that the RTC committed grave abuse of discretion in denying the motion to dismiss filed by the RCA.

We affirm the ruling of the CA.

The only exception to this rule is when the trial court gravely abused its discretion in denying the motion.^{^[38]}^[28] This exception is, nevertheless, applied sparingly, and only in instances when there is a clear showing that the trial court exercised its judicial power in an arbitrary or despotic manner by reason of passion or personal hostility.^{^[39]}^[29] Further, the abuse of the court’s discretion must be so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform the duty enjoined by, or to act at all in contemplation of, law.^{^[40]}^[30]

Here, in dismissing the petition for certiorari, the CA did not find grave abuse of discretion on the part of the RTC. The appellate court was not convinced with the RCA’s argument that plaintiffs failed to comply with the condition precedent provided in Article 477^{^[41]}^[31] of the Civil Code because they allegedly did not have legal or equitable title to, or interest in the real property. The CA explained that the requirement stated in Article 477 is not a condition precedent before one can file an action for quieting of title. Rather, it is a requisite for an action to quiet title to prosper and the existence or nonexistence of the requisite should be determined only after trial on the merits. The CA also agreed with the trial court in ruling that the RCA cannot raise in a motion to dismiss the ground that the complaint is already barred by laches for it still remains to be established during trial how long the plaintiffs have slept on their rights, if such be the case. Evidently, the CA is correct in finding that the denial by the RTC of the RCA’s motion to dismiss is not tainted with grave abuse of discretion.

The complaint filed with the RTC pertinently alleged that the claim of ownership by the RCA is spurious as its title, denominated as OCT No. 17629, is fake for the following reasons: (1) that the erasures are very apparent and the title itself is fake; (2) it was made to appear under Memorandum of Encumbrance Entry No. 1007 that the title is a reconstituted title when in truth, it is not; and (3) the verification reveals that there was no petition filed before any court where an order was issued for the reconstitution and re-issuance of an owner’s duplicate copy.^{^[43]}^[33] It is thus clear from the foregoing that the case filed questioning the genuineness of OCT No. 17629 is a direct attack on the title of the RCA.

We disagree.

Section 3, Rule 58 of the 1997 Rules of Civil Procedure, as amended, enumerates the grounds for the issuance of preliminary injunction, viz:

SEC. 3. Grounds for issuance of preliminary injunction. – A preliminary injunction may be granted when it is established:

(b) That the commission, continuance or nonperformance of the act or acts complained of during the litigation would probably work injustice to the applicant; or

And as clearly explained in Ocampo v. Sison Vda. de Fernandez:^{^[44]}^[34]

No costs.

SO ORDERED.

MARTIN S. VILLARAMA, JR.

Associate Justice

WE CONCUR:

RENATO C. CORONA

Chief Justice

Chairperson

TERESITA J. LEONARDO-DE CASTRO

Associate Justice

LUCAS P. BERSAMIN

Associate Justice

MARIANO C. DEL CASTILLO

Associate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the 1987 Constitution, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA

Chief Justice

^{^[1]}^[27] Urethane Trading Specialist, Inc. v. Ong, G.R. No. 164632, October 29, 2008, 570 SCRA 188, 191-192.

^{^[2]}^[28] See Nicolas v. Sandiganbayan, G.R. Nos. 175930-31 & 176010-11, February 11, 2008, 544 SCRA 324, 336 and Choa v. Choa, 441 Phil. 175, 182-183 (2002).

^{^[3]}^[28] See Nicolas v. Sandiganbayan, G.R. Nos. 175930-31 & 176010-11, February 11, 2008, 544 SCRA 324, 336 and Choa v. Choa, 441 Phil. 175, 182-183 (2002).

^{^[4]}^[29] Balo v. Court of Appeals, G.R. No. 129704, September 30, 2005, 471 SCRA 227, 234.

^{^[5]}^[30] Id.

^{^[6]}^[31] Art. 477. The plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the action. He need not be in possession of said property.

^{^[7]}^[32] Sarmiento v. Court of Appeals, G.R. No. 152627, September 16, 2005, 470 SCRA 99, 107-108.

[8][33] Rollo (G.R. No. 153829), p. 37.

^{^[9]}^[34] G.R. No. 164529, June 19, 2007, 525 SCRA 79, 94-95.

^{^[10]}^[35] See Medina v. City Sheriff, Manila, 342 Phil. 90, 97 (1997).

^{^[11]}^[1] Rollo (G.R. No. 160909), p. 10.

^{^[12]}^[2] Rollo (G.R. No. 153829), pp. 21-26. Penned by Associate Justice Perlita J. Tria Tirona with Associate Justices Eubulo G. Verzola and Bernardo P. Abesamis concurring.

^{^[13]}^[3] Id. at 28.

^{^[14]}^[4] Rollo (G.R. No. 160909), pp. 18-20.

^{^[15]}^[5] Records, p. 11.

^{^[16]}^[6] Id. at 1-9.

^{^[17]}^[7] Rollo (G.R. No. 160909), pp. 21-37. Penned by Judge Valentino B. Nogoy.

^{^[18]}^[8] Sec. 21. Immediate execution on appeal to Court of Appeals or Supreme Court.—The judgment of the Regional Trial Court against the defendant shall be immediately executory, without prejudice to a further appeal that may be taken therefrom.

^{^[19]}^[9] Rollo (G.R. No. 160909), pp. 13-16.

^{^[20]}^[10]Id. at 16.

^{^[21]}^[11]Id. at 17.

^{^[22]}^[12] Supra note 4.

^{^[23]}^[13]Id. at 21.

^{^[24]}^[14]Id. at 3-12.

[25][15] Rollo, (G.R. No. 153829), pp. 36-43.

[26][16] Id. at 44-45. Issued by Judge Herminio Z. Canlas.

^{^[27]}^[17]Id. at 46-47.

^{^[28]}^[18] CA rollo, pp. 2-17.

[29][19] Supra note 2.

[30][20] Id. at 25.

[31][21] Id. at 29-35.

[32][22] Id. at 28.

[33][23] Id. at 3-19.

^{^[34]}^[24] Rollo (G.R. No. 160909), p. 38.

^{^[35]}^[25]Id. at 39.

^{^[36]}^[26] Rollo (G.R. No. 153829), p. 9.

^{^[37]}^[27] Urethane Trading Specialist, Inc. v. Ong, G.R. No. 164632, October 29, 2008, 570 SCRA 188, 191-192.

^{^[38]}^[28] See Nicolas v. Sandiganbayan, G.R. Nos. 175930-31 & 176010-11, February 11, 2008, 544 SCRA 324, 336 and Choa v. Choa, 441 Phil. 175, 182-183 (2002).

^{^[39]}^[29] Balo v. Court of Appeals, G.R. No. 129704, September 30, 2005, 471 SCRA 227, 234.

^{^[40]}^[30] Id.

^{^[41]}^[31] Art. 477. The plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the action. He need not be in possession of said property.

^{^[42]}^[32] Sarmiento v. Court of Appeals, G.R. No. 152627, September 16, 2005, 470 SCRA 99, 107-108.

[43][33] Rollo (G.R. No. 153829), p. 37.

^{^[44]}^[34] G.R. No. 164529, June 19, 2007, 525 SCRA 79, 94-95.

^{^[45]}^[35] See Medina v. City Sheriff, Manila, 342 Phil. 90, 97 (1997).

Comment

J.A.B. Bulao & Associates

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