MARTINEZ VS. MARTINEZ JUNE 28, 2005

The spouses Daniel P. Martinez, Sr. and Natividad de Guzman-Martinez were the owners of a parcel of land by TCT No. 54334, as well as the house constructed thereon. On March 6, 1993, Daniel, Sr. executed a Last Will and Testament directing the subdivision of the property into three lots, namely, Lots 18-B-2-A, 18-B-2-B and 18-B-2-C. He then handed down the three lots to each of his sons, namely, Rodolfo, Manolo and Daniel, Jr.; Manolo was designated as the administrator of the estate. After the death of the spouses, Rodolfo found a deed of sale purportedly signed by his father on September 15, 1996, where the latter appears to have sold Lot 18-B-2 to Manolo and his wife Lucila.6He also discovered that TCT No. 237936 was issued to the vendees based on the said deed of sale.

Rodolfo filed a complaint for annulment of deed of sale and cancellation of TCT No. 237936 against his brother Manolo and his sister-in-law Lucila before the RTC. He also filed a criminal complaint for estafa through falsification of a public document in the Office of the City Prosecutor against Manolo, which was elevated to the Department of Justice.

In the meantime, the spouses Manolo and Lucila Martinez wrote Rodolfo, demanding that he vacate the property. Rodolfo ignored the letter and refused to do so. This prompted the said spouses to file a complaint for unlawful detainer against Rodolfo in the MTC of Manila. They alleged that they were the owners of the property covered by TCT No. 237936, and that pursuant to Presidential Decree (P.D.) No. 1508, the matter was referred to thebarangay for conciliation and settlement, but none was reached. They appended the certification to file action executed by the barangay chairman to the complaint.

In Rodolfo’s answer he alleged that the complaint failed to state a condition precedent, namely, that earnest efforts for an amicable settlement of the matter between the parties had been exerted, but that none was reached. He also pointed out that the dispute had not been referred to the barangay before the complaint was filed.

Issue:

Whether or not Art. 150 of the Family Code or earnest efforts for amicable settlement is necessary before the filing of this case.

Ruling:

No, Art. 151 of the Family Code provide, thus:

“Art. 151. No suit between members of the same family shall prosper unless it should appear from the verified complaint or petition that earnest efforts toward a compromise have been made, but that the same have failed. If it is shown that no such efforts were, in fact, made, the case must be dismissed.

This rule shall not apply to cases which may not be the subject of compromise under the Civil Code.”

The phrase "members of the family" must be construed in relation to Article 150 of the Family Code, to wit:

“Art. 150. Family relations include those:

(1) Between husband and wife;

(2) Between parents and children;

(3) Among other ascendants and descendants; and

(4) Among brothers and sisters, whether of the full or half-blood.”

Hence, a sister-in-law or brother-in-law is not included in the enumeration. In this case, the decision of the CA that the petitioners were mandated to comply with Article 151 of the Family code and that they failed to do so is erroneous.

Mrs. Gayon is plaintiff’s sister-in-law, whereas her children are his nephews and/or nieces. Inasmuch as none of them is included in the enumeration contained in said Art. 217 – which should be construed strictly, it being an exception to the general rule – and Silvestre Gayon must necessarily be excluded as party in the case at bar, it follows that the same does not come within the purview of Art. 222, and plaintiff’s failure to seek a compromise before filing the complaint does not bar the same.

Second. The petitioners were able to comply with the requirements of Article 151 of the Family Code because they alleged in their complaint that they had initiated a proceeding against the respondent for unlawful detainer in theKatarungang Pambarangay, in compliance with P.D. No. 1508; and that, after due proceedings, no amicable settlement was arrived at, resulting in the barangay chairman’s issuance of a certificate to file action.

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LEJANO VS PEOPLE

GR Nos. 176389 and 176864                                        January 18, 2011

Facts:The Supreme Court reversed the judgment of the CA and acquitted accused, namely: Hubert Webb, Antonio Lejano, Michael Atchalian, Hospicio Fernandez, Miguel Rodriguez, Peter Estrada, and Gerardo Biong on the ground of lack of proof of their guilt beyond reasonable doubt.

Thereafter, complaint Lauro Vizconde, asked the Court to reconsider its decision, claiming that it "denied the prosecution due process of law; seriously misappreciated the facts; unreasonably regarded Alfaro as lacking credibility; issued a tainted and erroneous decision; decided the case in a manner that resulted in the miscarriage of justice; or committed grave abuse in its treatment of the evidence and prosecution witnesses."

Issue:Whether or not a judgment of acquittal may be reconsidered.

Ruling:No, as a rule a judgment of acquittal cannot be reconsidered for it places the accused under double jeopardy. On occasions, a motion for reconsideration after an acquittal is possible, but the grounds are exceptional and narrow as when the court that absolved the accused gravely abused its discretion, resulting in loss of jurisdiction, or when a mistrial has occurred. In any of such cases, the State may assail the decision by special civil action of certiorari under Rule 65.

Althou complainant Vizconde invoked the exceptions, he has been unable to bring pleas for reconsideration under such exceptions. He did not specify that violations of due process and acts constituting grave abuse of discretion that the Court supposedly committed. Vizconde did not also alleged that the Court held a sham review of the decision of the CA. What the complainant actually questions is the Court's appreciation of the evidence and assessment of the prosecution witnesses' credibility. That the court committed grave error in finding Alfaro as not a credible witness. The complaint wants the court to review the evidence anew and render another judgment based on such evaluation which is not constitutionally allowed and therefore, the judgment of acquittal can no longer be disturbed.

ANTONIO LEJANO vs. PEOPLE OF THE PHILIPPINES/PEOPLE OF THE PHILIPPINES vs. HUBERT JEFFREY P. WEBB ET. AL, G.R. No. 176864. Dec. 14, 2010GR No. 176389ANTONIO LEJANO, Petitioner,vs.PEOPLE OF THE PHILIPPINES, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - -x

G.R. No. 176864PEOPLE OF THE PHILIPPINES, Appellee,vs.HUBERT JEFFREY P. WEBB, ANTONIO LEJANO, MICHAEL A. GATCHALIAN, HOSPICIO FERNANDEZ, MIGUEL RODRIGUEZ, PETER ESTRADA and GERARDO BIONG, Appellants.

December 14, 2010

Facts:

On June 30, 1991 Estrellita Vizconde and her daughters Carmela, nineteen years old, and xxx, seven, were brutally slain at their home in Parañaque City. Following an intense investigation, the police arrested a group of suspects, some of whom gave detailed confessions. But the trial court smelled a frame-up and eventually ordered them discharged. Thus, the identities of the real perpetrators remained a mystery especially to the public whose interests were aroused by the gripping details of what everybody referred to as the Vizconde massacre.

Four years later in 1995, the National Bureau of Investigation or NBI announced that it had solved the crime. It presented star-witness Jessica M. Alfaro, one of its informers, who claimed that she witnessed the crime. She pointed to accused Hubert Jeffrey P. Webb, Antonio "Tony Boy" Lejano, Artemio "Dong" Ventura, Michael A. Gatchalian, Hospicio "Pyke" Fernandez, Peter Estrada, Miguel "Ging" Rodriguez, and Joey Filart as the culprits. She also tagged accused police officer, Gerardo Biong, as an accessory after the fact. Relying primarily on Alfaro's testimony, on August 10, 1995 the public prosecutors filed an information for rape with homicide against Webb, et al.

The Regional Trial Court of Parañaque City, presided over by Judge Amelita G. Tolentino, tried only seven of the accused since Artemio Ventura and Joey Filart remained at large.

The prosecution presented Alfaro as its main witness with the others corroborating her testimony. These included the medico-legal officer who autopsied the bodies of the victims, the security guards of Pitong Daan Subdivision, the former laundrywoman of the Webb’s household, police officer Biong’s former girlfriend, and Lauro G. Vizconde, Estrellita’s husband.

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Webb’s alibi appeared the strongest since he claimed that he was then across the ocean in the United States of America. He presented the testimonies of witnesses as well as documentary and object evidence to prove this. In addition, the defense presented witnesses to show Alfaro's bad reputation for truth and the incredible nature of her testimony.

But impressed by Alfaro’s detailed narration of the crime and the events surrounding it, the trial court found a credible witness in her. It noted her categorical, straightforward, spontaneous, and frank testimony, undamaged by grueling cross-examinations.

On January 4, 2000, after four years of arduous hearings, the trial court rendered judgment, finding all the accused guilty as charged and imposing on Webb, Lejano, Gatchalian, Fernandez, Estrada, and Rodriguez the penalty of reclusion perpetua and on Biong, an indeterminate prison term of eleven years, four months, and one day to twelve years. The trial court also awarded damages to Lauro Vizconde.

On appeal, the Court of Appeals affirmed the trial court’s decision, modifying the penalty imposed on Biong to six years minimum and twelve years maximum and increasing the award of damages to Lauro Vizconde.

The appellate court did not agree that the accused were tried by publicity or that the trial judge was biased. It found sufficient evidence of conspiracy that rendered Rodriguez, Gatchalian, Fernandez, and Estrada equally guilty with those who had a part in raping and killing Carmela and in executing her mother and sister.

On April 20, 2010, as a result of its initial deliberation in this case, the Court issued a Resolution granting the request of Webb to submit for DNA analysis the semen specimen taken from Carmela’s cadaver, which specimen was then believed still under the safekeeping of the NBI.

The Court granted the request pursuant to section 4 of the Rule on DNA Evidence to give the accused and the prosecution access to scientific evidence that they might want to avail themselves of, leading to a correct decision in the case.

Unfortunately, on April 27, 2010 the NBI informed the Court that it no longer has custody of the specimen, the same having been turned over to the trial court. The trial record shows, however, that the specimen was not among the object evidence that the prosecution offered in evidence in the case.

This outcome prompted accused Webb to file an urgent motion to acquit on the ground that the government’s failure to preserve such vital evidence has resulted in the denial of his right to due process.

Controlling Issues:

1. Whether or not Alfaro’s testimony as eyewitness, describing the crime and identifying Webb, Lejano, Gatchalian, Fernandez, Estrada, Rodriguez, and two others as the persons who committed it, is entitled to belief; and

2. Whether or not Webb presented sufficient evidence to prove his alibi and rebut Alfaro’s testimony that he led the others in committing the crime.

Other Issues:

1. Whether or not the Court should acquit him outright, given the government’s failure to produce the semen specimen that the NBI found on Carmela’s cadaver, thus depriving him of evidence that would prove his innocence; and

2. Whether or not Webb, acting in conspiracy with Lejano, Gatchalian, Fernandez, Estrada, Rodriguez, Ventura, and Filart, raped and killed Carmela and put to death her mother and sister.

Held:

The Right to Acquittal Due to Loss of DNA Evidence

Webb claims, citing Brady v. Maryland, that he is entitled to outright acquittal on the ground of violation of his right to due process given the State’s failure to produce on order of the Court either by negligence or willful suppression the semen specimen taken from Carmela.

When Webb raised the DNA issue, the rule governing DNA evidence did not yet exist, the country did not yet have the technology for conducting the test, and no Philippine precedent had as yet recognized its admissibility as evidence.

Consequently, the idea of keeping the specimen secure even after the trial court rejected the motion for DNA testing did not come up. Indeed, neither Webb nor his co-accused brought up the matter of preserving the specimen in the meantime.

Parenthetically, after the trial court denied Webb’s application for DNA testing, he allowed the proceeding to move on when he had on at least two occasions gone up to the Court of Appeals or the Supreme Court to challenge alleged arbitrary actions taken against him and the other accused.

They raised the DNA issue before the Court of Appeals but merely as an error committed by the trial court in rendering its decision in the case. None of the accused filed a motion with the appeals court to have the DNA test done pending

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adjudication of their appeal. This, even when the Supreme Court had in the meantime passed the rules allowing such test. Considering the accused’s lack of interest in having such test done, the State cannot be deemed put on reasonable notice that it would be required to produce the semen specimen at some future time.

Suspicious Details

Alfaro had been hanging around at the NBI since November or December 1994 as an "asset." She supplied her handlers with information against drug pushers and other criminal elements. Some of this information led to the capture of notorious drug pushers like Christopher Cruz Santos and Orlando Bacquir. Alfaro’s tip led to the arrest of the leader of the "Martilyo gang" that killed a police officer. Because of her talent, the task force gave her "very special treatment" and she became its "darling," allowed the privilege of spending nights in one of the rooms at the NBI offices.

When Alfaro seemed unproductive for sometime, however, they teased her about it and she was piqued. One day, she unexpectedly told Sacaguing that she knew someone who had the real story behind the Vizconde massacre. Sacaguing showed interest. Alfaro promised to bring that someone to the NBI to tell his story. When this did not happen and Sacaguing continued to press her, she told him that she might as well assume the role of her informant.

Webb’s U.S. Alibi

Among the accused, Webb presented the strongest alibi through (a) the travel preparations; (b) the two immigration checks; (c) details of US sojourn; (d) the second immigration check; and (e) alibi versus positive identification; and (f) a documented alibi.

To establish alibi, the accused must prove by positive, clear, and satisfactory evidence that (a) he was present at another place at the time of the perpetration of the crime, and (b) that it was physically impossible for him to be at the scene of the crime.

The trial court and the Court of Appeals expressed marked cynicism over the accuracy of travel documents like the passport as well as the domestic and foreign records of departures and arrivals from airports. They claim that it would not have been impossible for Webb to secretly return to the Philippines after he supposedly left it on March 9, 1991, commit the crime, go back to the U.S., and openly return to the Philippines again on October 26, 1992. Travel between the U.S. and the Philippines, said the lower courts took only about twelve to fourteen hours.

Effect of Webb’s alibi to others

Webb’s documented alibi altogether impeaches Alfaro's testimony, not only with respect to him, but also with respect to Lejano, Estrada, Fernandez, Gatchalian, Rodriguez, and Biong. For, if the Court accepts the proposition that Webb was in the U.S. when the crime took place, Alfaro’s testimony will not hold together. Webb’s participation is the anchor of Alfaro’s story. Without it, the evidence against the others must necessarily fall.

Conclusion

In our criminal justice system, what is important is, not whether the court entertains doubts about the innocence of the accused since an open mind is willing to explore all possibilities, but whether it entertains a reasonable, lingering doubt as to his guilt. For, it would be a serious mistake to send an innocent man to jail where such kind of doubt hangs on to one’s inner being, like a piece of meat lodged immovable between teeth.

Will the Court send the accused to spend the rest of their lives in prison on the testimony of an NBI asset who proposed to her handlers that she take the role of the witness to the Vizconde massacre that she could not produce?

The Supreme Court REVERSES and SETS ASIDE the Decision dated December 15, 2005 and Resolution dated January 26, 2007 of the Court of Appeals in CA-G.R. CR-H.C. 00336 and ACQUITS accused-appellants Hubert Jeffrey P. Webb, Antonio Lejano, Michael A. Gatchalian, Hospicio Fernandez, Miguel Rodriguez, Peter Estrada and Gerardo Biong of the crimes of which they were charged for failure of the prosecution to prove their guilt beyond reasonable doubt. They are ordered immediately RELEASED from detention unless they are confined for another lawful cause.

CRESPO vs MOGUL

GR No. L-53373  June 30, 1987

 

FACTS:

Assistant Fiscal Proceso K. Gala with the approval of the Provincial Fiscal filed an information for estaga against Mario Crespo in the Circuit Criminal Court of Lucena City. When the case was set for arraignment the accused filed a motion to deter arraignment on the ground that there was a pending petition for review filed with the Secretary of Justice of the resolution of the office of provincial Fiscal.

 CARDINAL PRINCIPLE:

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Criminal actions either commenced by complaint or by information shall be prosecuted under the direction and control of the fiscal. The institution of a criminal action depends upon the sound discretion of the Fiscal. He may or he may not file the complaint or information, follow or not follow that presented by the offended party, according to whether the evidence in his opinion, is sufficient or not to establish the guilt of the accused beyond reasonable doubt. The reason for placing the criminal prosecution under the discretion and control of the fiscal is to prevent malicious or unfounded prosecution by private persons.

 It is through the conduct of preliminary investigation, that the fiscal determines the existence of a Prima Facie case that would warrant the prosecution of a case. The Courts cannot interfere with the fiscal’s discretion and control of the criminal prosecution. It is not prudent or even permissible for a Court of compel the fiscal to prosecute a proceeding originally initiated by him on an information.

 In a clash of views between the Judge who did not investigate and the Fiscal who did, or between the fiscal and the offended party or the defendant, those of the Fiscal’s should normally prevail.

 The action of fiscal or prosecutor is not without any limitation or control. The same is subject to the approval to the Provincial or City Fiscal or the Chief of State Prosecutor as the case maybe and it maybe elevated for review to the Secretary of Justice who has the power to affirm, modify or reverse the action or opinion of the Fiscal.

CARMELITA T. PANGANIBAN, petitioner, vs. PILIPINAS SHELL PETROLEUM CORPORATION, respondent.

D E C I S I O N

CARPIO, J.:

The Case

Before us is a petition for review assailing the Decision[1] of the Court of Appeals dated November 12, 1997 in CA-G.R. SP No. 44673 dismissing the appeal of petitioner.  The questioned decision affirmed the order of the Regional Trial Court of Makati City, Branch 137, in Case No. 95-1010 dismissing petitioner’s petition for declaratory relief on the ground oflitis pendentia.

The Antecedent Facts

On August 7, 1990, Carmelita Panganiban (“petitioner” for brevity) entered into a Sublease and Dealer Agreement (“SLDA” for brevity) with Pilipinas Shell Petroleum Corporation (“private respondent” for brevity).  Through the SLDA, private respondent subleased to petitioner a gasoline station located at 427 Samson Road, EDSA, Caloocan City.  The period of the sublease as stipulated in the SLDA is as follows:

“5.  Effectivity Date.   Duration  and Termination of Agreement.

This Agreement may be terminated by SHELL at any time during the first six (6) months from the date of approval by ERB of the application of the DEALER to operate this station, on any of the following grounds: failure of the DEALER to meet any of the conditions stipulated in this Agreement, lack of appropriate  personal attention/presence  in the operation of the station, or poor volume performance of the station, the evaluation and determination of which shall be at the exclusive discretion of SHELL.  Such decision of termination by SHELL shall be accepted by the DEALER, who hereby agrees that another dealer shall be appointed by SHELL and approved by BEU or other appropriate government agency.  If this agreement is not terminated during the first six (6) months, it shall continue to be in effect for another period of 4½ years, unless otherwise terminated as herein provided in paragraph 5(3).  The parties agree that this Agreement is, however, co-terminus with SHELL’s lease on the site referred to under paragraph 1 of this Agreement notwithstanding the total 5-year period aforementioned.”[2]

Private respondent is not the owner of the lot subject of the sublease.  Private respondent was only leasing the lot from its owner, Serafin Vasquez, pursuant to a Lease Agreement dated February 27, 1987.  The Lease Agreement was effective from January 1, 1987 to December 31, 2002 or for a period of 15 years.

In a letter dated June 14, 1995, private respondent notified petitioner that the SLDA was expiring on July 31, 1995.  Private respondent then advised petitioner to wind up her business on or before July 31, 1995.

Believing that the SLDA had not yet expired and was still effective until December 31, 2002, petitioner continued to pay rentals for the gasoline station.   Private respondent refused to accept the payments.

On July 10, 1995, petitioner filed a petition for declaratory relief with Branch 137 of the Regional Trial Court of Makati City.  The case was docketed as Case No. 95-1010.

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On August 30, 1995, private respondent filed its Answer.

On April 26, 1996, private respondent filed an unlawful detainer case against petitioner with the Metropolitan Trial Court of Caloocan City.  The case was docketed as Civil Case No. 22645.

On April 30, 1996, or eight months after it submitted its Answer in Case No. 95-1010 with the Regional Trial Court, private respondent filed a Manifestation with Motion to Dismiss in the same case.  Private respondent claimed that the issue of the renewal of the lease should be raised in the unlawful detainer case pending before the Metropolitan Trial Court.

On August 1, 1996, during the preliminary conference of the unlawful detainer case, petitioner moved for the suspension of the proceedings since the other case filed with the Regional Trial Court involved the same parties and issues.  The Metropolitan Trial Court denied petitioner’s motion and the court ordered the parties to submit their position papers.

On September 25, 1996, the Metropolitan Trial Court issued its Decision in the unlawful detainer case in favor of private respondent, thus:

“WHEREFORE, premises considered, judgment is hereby rendered, ordering:

1.  the defendant and all persons or parties claiming rights under her to vacate the subject subleased premises and peacefully surrender possession thereof to the plaintiff;

2.  the said defendant to pay the plaintiff as follows:

a)  the amount of P52,500.00 per month from August 1, 1995 until the said premises is fully vacated by defendant and returned to plaintiff;

b)  the amount of P20,000.00 as plaintiff’s reduced attorney’s fees; and

c)  the costs of suit.

The counterclaim of the defendant is dismissed for lack of merit.

IT IS SO ORDERED.”[3]

Petitioner appealed from the decision of the Metropolitan Trial Court.  The appeal is now pending with the Regional Trial Court of Caloocan City, Branch 124, docketed as Civil Case No. C-17726.

On February 21, 1997, the Regional Trial Court ordered the dismissal of the petition for declaratory relief.  The Order reads:

“Considering that there has been a breach of the Sublease and Dealer Agreement (SLDA) on the part of the petitioner (lessee therein) as said lease had supposedly expired on 31 July 1995, and that, consequently, an ejectment has already been filed against petitioner by respondent before the Metropolitan Trial Court of Kalookan City, so that this petition is no longer proper under the  circumstances, and considering further that the issue on possession can be threshed out in said ejectment case based on the jurisprudence in Rosales vs. CFI of Lanao del Norte, Br. III, 154 SCRA 153, this petition is dismissed.”[4]

Petitioner filed a motion for reconsideration of the Order.  Because of petitioner’s failure to appear at the hearing on her motion for reconsideration, the Regional Trial Court on April 11, 1997 denied the motion for reconsideration.

On May 13, 1997, petitioner filed a petition for review under Rule 45 of the Rules of Court with the Supreme Court.  The petition assailed the February 21, 1997 Order of the Regional Trial Court dismissing Case No. 95-1010.   The petition was docketed as G.R. No. 128984.

On June 25, 1997, the Supreme Court issued a Resolution referring the petition for certiorari to the Court of Appeals.  The petition was referred to the Court of Appeals because the appellate court has concurrent jurisdiction with the Court and petitioner failed to cite a special or important reason for the Court to take immediate cognizance of the petition.

On November 12, 1997, the Court of Appeals denied the petition for certiorari.  The dispositive portion of the Decision reads:

“THE FOREGOING CONSIDERED, and not being sufficient in substance, herein Petition for Certiorari is hereby dismissed.”[5]

The Ruling of the Court of Appeals

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The Court of Appeals upheld the order of the trial court dismissing the petition for declaratory relief on the ground of litis pendentia.  The appellate court ruled that in dismissing the petition for declaratory relief, the Regional Trial Court correctly applied the doctrine laid down in Rosales v. Court of First Instance of Lanao del Norte.[6]  The Court of Appeals also considered University Physicians Services, Inc. v. Court of Appeals[7] as a case parallel to the present case.  In ruling that the case for declaratory relief should be abated in favor of the case for unlawful detainer, the Court of Appeals quoted the pertinent portions of Rosales[8]  and  University Physicians Services, Inc.[9]

In disregarding petitioner’s contention that it is this Court that has jurisdiction over her petition, the Court of Appeals pointed out that it was merely yielding to this Court’s June 25, 1997 Resolution ordering the appellate court to decide the case on the merits.   This Court referred the petition to the Court of Appeals because the appellate court has concurrent jurisdiction with this Court and there is no “special or important reason” for this Court to take immediate cognizance of the case.

The Issues

The sole issue raised by petitioner in this case is:

“THE COURT OF APPEALS ERRED IN AFFIRMING RTC-MAKATI’S DISMISSAL OF CIVIL CASE NO. 95-1010 ON MOTION OF SHELL ON THE GROUND OF LITIS PENDENTIA WHICH WAS FILED LONG AFTER SHELL HAD FILED ITS ANSWER.”[10]

The Ruling of the Court

We find no merit in the petition.

The Court of Appeals correctly applied Rosales[11] and University Physicians Services, Inc.[12] in sustaining the dismissal of the action for declaratory relief to give way to the ejectment suit.

In Rosales,[13] the real issue between the parties, the lessor and the lessee, was whether the contract of lease they entered into had already prescribed.  The lessee filed an action for the continued enforcement of the lease contract and for damages with the Court of First Instance of Iligan City.  The lessor in turn filed a case for unlawful detainer with the City Court of Iligan City.  The lessor filed with the Court of First Instance a motion to dismiss the complaint of the lessee because of the pendency of the ejectment case.  The lessee for his part moved for the dismissal of the ejectment suit also on the ground of litis pendentia contending that the case he had filed earlier should be decided first before the lessor’s complaint could be entertained.  In deciding which case should take precedence, the Court cited the ruling in Pardo v. Encarnacion,[14] to wit:

“At any rate, while the said case before the Court of First Instance of Cavite appears to be one for specific performance with damages, it cannot be denied that the real issue between the parties is whether or not the lessee should be allowed to continue occupying the land as lessee.

The situation is not novel to Us.

It has been settled in a number of cases that the right of a lessee to occupy the land leased as against the demand of the lessor should be decided under Rule 70 (formerly 72) of the Rules of Court.

There is no merit to the contention that the lessee’s supposed right to a renewal of the lease contract can not be decided in the ejectment suit. In the case of Teodoro v. Mirasol, supra, this Court held that ‘if the plaintiff has any right to the extension of the lease at all, such right is a proper and legitimate issue that could be raised in the unlawful detainer case because it may be used as a defense to the action.’  In other words, the matter raised in the Court of First instance of Cavite may be threshed out in the ejectment suit, in consonance with the principle prohibiting multiplicity of suits.  And the mere fact that the unlawful detainer case was filed later, would not change the situation to depart from the application of the foregoing rule.

‘It is to be noted that the Rules do not require as a ground for dismissal of a complaint that there is a prior pending action.  They provide that there is pending action, not a pending prior action.  The fact that the unlawful detainer  suit was of a later date is no bar to the dismissal of the present action.’ (Teodoro, Jr. v. Mirasol, supra.)”

In University Physicians Services, Inc.,[15] the Court also had to resolve which of two cases, one for damages and one for ejectment, filed in two different courts involving the same parties and subject matter, should take precedence over the other.  In settling this issue, the Court also relied on Pardo v. Encarnacion, citing the discussion quoted above. The Court further declared in University Physicians Services, Inc. that:

“The issue of whether private respondent had the right to occupy the subject apartment unit should therefore be properly threshed out in an ejectment suit and not in an action for damages where the question of possession is likewise the primary issue to be resolved.

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We cannot simply ignore the fact that private respondent, after her unjustified refusal to vacate the premises, was aware that an ejectment case against her was forthcoming.  It is therefore evident that the filing of the complaint for damages and preliminary injunction was but a canny and preemptive maneuver intended to block the action for ejectment which petitioner was to take against private respondent.

The matter raised in the Regional Trial Court of Manila may be properly determined in the ejectment suit before the Metropolitan Trial Court, in consonance with the rule prohibiting multiplicity of suits. And the mere fact that the unlawful detainer suit was filed later than the one for damages does not change the situation of the parties (Rosales vs. CFI, 154 SCRA 153 [1987])”.

Petitioner insists that the doctrine laid down in Rosales and University Physicians Services, Inc. is not applicable to this case.  Rather, the case law applicable is that laid down in J.M. Tuason & Co., Inc. v. Rafor,[16] Ruiz, Jr. v. Court of Appeals[17] and Heirs of Mariano Lagutan v. Icao[18] which essentially establish the doctrine that a motion to dismiss must be filed within the time to answer.  Petitioner further points out that private respondent filed the motion to dismiss some eight months after it had already filed an answer in Case No. 95-1010, the action for declaratory relief. This, according to petitioner, is a violation of Section 1, Rule 16 of the Rules of Court mandating that the motion to dismiss must be filed within the time for but before the filing of the answer to the complaint.

We are not persuaded.

The requirement that a motion to dismiss should be filed within the time for filing the answer is not absolute. Even after an answer has been filed, a defendant can still file a motion to dismiss on the following grounds:  (1) lack of jurisdiction, (2) litis pendentia (3) lack of cause of action, and (4) discovery during trial of evidence that would constitute a ground for dismissal.[19]  Litis pendentia is also one of the grounds that authorize a court to dismiss a case motu proprio.[20]

The cases relied upon by petitioner, namely, J.M. Tuason & Co., Inc., Ruiz, Jr. and Heirs of Mariano Lagutan, are not squarely in point. The motions to dismiss in these cases were also predicated on the grounds that would have permitted the filing of a motion to dismiss even after an answer had already been filed.  However, in each of the three cases, the Court found the elements of the exceptional grounds invoked in the motions to dismiss to be insufficient.  Thus, in J.M. Tuason & Co., Inc., Ruiz, Jr. and Heirs of Mariano Lagutan, the Court applied the general rule that a party who has filed his answer is already estopped from filing a motion to dismiss.

The present case is different from J.M. Tuason & Co., Inc., Ruiz, Jr., and Heirs of Mariano Lagutan. In this case, the bona fide existence of litis pendentia is beyond dispute.  The following requisites of litis pendentia are present in this case:  (a) the identity of parties, or at least such as representing the same interests in both actions; (b) the identity of rights asserted and relief prayed for, the relief being founded on the same facts; and (c) the identity of the two cases such that judgment in one, regardless of which party is successful, would amount to res judicata in the other.[21]

Petitioner questions the preference given by the Regional Trial Court and the Court of Appeals to the unlawful detainer case filed by private respondent.  Petitioner maintains that based on priority in time, the action for declaratory relief, the case filed earlier, should not have been abated in favor of the ejectment suit, a case filed much later.

Litis pendentia as a ground for the dismissal of a civil action refers to that situation wherein another action is pending between the same parties for the same cause of actions and that the second action becomes unnecessary and vexatious.[22] We have set the relevant factors that a court must consider when it has to determine which case should be dismissed given the pendency of two actions.  These are:

“(1) the date of filing, with preference generally given to the first action filed to be retained;

(2) whether the action sought to be dismissed was filed merely to preempt the latter action or to anticipate its filing and lay the basis for its dismissal; and

(3) whether the action is the appropriate vehicle for litigating the issues between the parties.”[23]

The mere fact that the action for declaratory relief was filed earlier than the case for unlawful detainer does not necessarily mean that the first case will be given preference.Rosales and University Physicians Services, Inc. clearly place a premium on the two other factors. In Cruz v. Court of Appeals,[24] we have ruled that the earlier case can be dismissed in favor of the later case if the later case is the more appropriate forum for the ventilation of the issues between the parties.

An action for unlawful detainer is filed by a person from whom possession of any land or building is unlawfully withheld by another after the expiration or termination of the latter’s right to hold possession under a contract, express or implied.[25]  Clearly, the interpretation of a provision in the SLDA as to when the SLDA would expire is the key issue that would determine petitioner’s right to possess the gasoline service station. When the primary issue to be resolved is physical possession, the issue should be threshed out in the ejectment suit, and not in any other case such as an action for declaratory relief to avoid multiplicity of suits.

There is a more compelling reason for the dismissal of the action for declaratory relief.  The Metropolitan Trial Court had already resolved the unlawful detainer case in favor of private respondent even before the Regional Trial Court dismissed the action for declaratory relief.  The Metropolitan Trial Court issued its Decision on September 25, 1996 and this decision is now on appeal.[26] The Regional Trial Court dismissed the action for declaratory relief on February 21, 1997 based on the April 30, 1996 Motion to Dismiss filed by private respondent that raised the ground of litis pendentia. Based on the record, it appears that private respondent failed to inform the Regional Trial Court of the decision of the Metropolitan Trial Court on the unlawful detainer case.  The significance of the earlier resolution of the unlawful detainer case, however, will not escape our attention.

9

Indeed, the action for declaratory relief had become vexatious.  It would have been an exercise in futility for the Regional Trial Court to continue the proceedings in the action for declaratory relief when the Metropolitan Trial Court had already ruled that the term of the SLDA was for only five years or until July 31, 1995.[27]  Moreover, the decision of the Metropolitan Trial Court once it attains finality would amount to res judicata. The proper forum for petitioner to clarify  the provision of the SLDA on the expiration of the term of the contract is in her appeal of the decision of the Metropolitan Trial Court in the unlawful detainer case.

Petitioner erroneously believes that the unlawful detainer case should have been dismissed because private respondent was already guilty of laches when it filed the ejectment suit 269 days from July 31, 1995, the date private respondent claims the SLDA expired.  A complaint for unlawful detainer should be filed within one year after such unlawful deprivation or withholding of possession occurs.[28]  When the action is to terminate the lease because of the expiration of its term, it is upon the expiration of the term of the lease that the lessee is already considered to be unlawfully withholding the property.[29] The expiration of the term of the lease immediately gives rise to a cause of action for unlawful detainer.[30] In such a case, a demand to vacate is no longer necessary.[31] Private respondent therefore had one year or 365 days from July 31, 1995 to file the case for unlawful detainer.  Laches definitely had not yet set in when private respondent filed the unlawful detainer case 269 days after the expiration of the SLDA.  Private respondent did not sleep on its right when it filed the unlawful detainer case well within the prescriptive period for filing the action.

Petitioner implores us to reconsider the application of Rosales[32] and University Physicians Services, Inc.[33] to this case because this will, in the words of petitioner, “open a floodgate of abuses.”[34]  Petitioner claims that this can happen where an earlier case filed by the lessee is already submitted for resolution and the lessor belatedly files an ejectment suit to create a cause to dismiss the earlier case based on litis pendentia.

Petitioner’s contention is unfounded.

The action for declaratory relief was not yet submitted for resolution when private respondent filed the action for unlawful detainer.  There is also no proof that private respondent filed the ejectment suit in anticipation of the early resolution of the action for declaratory relief.  Private respondent was not out to frustrate the impending resolution of the action for declaratory relief when it filed the ejectment suit.  In fact, the unlawful detainer case was already decided upon by the Metropolitan Trial Court even before the Regional Trial Court dismissed the action for declaratory relief.  It appears that it is petitioner who wants to avoid the adverse ruling in the unlawful detainer case by insisting that the action for declaratory relief be given preference even after the ejectment suit was already decided.  The “abuse” feared by petitioner does not apply in this case and yet, petitioner urges us to reevaluate the applicability of a doctrine based on a feared hypothetical abuse. This, we cannot do.  We can only rule upon actual controversies, not on scenarios that a party merely conjures to suit her interest.

WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioner.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, Ynares-Santiago and Azcuna, JJ., concur.

G.R. No. 151135             July 2, 2004

CONTEX CORPORATION, petitioner, vs.

HON. COMMISSIONER OF INTERNAL REVENUE, respondent.

As an SBMA-registered firm, Contex is exempt from all local and national internal revenue taxes except for the preferential tax provided for in Section 12 (c)5 of Rep. Act No. 7227. Cpntex also registered with the Bureau of Internal Revenue (BIR) as a non-VAT taxpayer under a Certificate of Registration

Contex purchased various supplies and materials necessary in the conduct of its manufacturing business. The suppliers of these goods shifted unto Contex the 10% VAT on the purchased items , which led the Contex to pay input taxes in the amounts of P 539,411.88 and P 504,057.49 for 1997 and 1998, respectively

Acting on the belief that it was exempt from all national and local taxes, including VAT, Contex filed two applications with RDO for tax refund or tax credit of the VAT it paid. Revenue District Officer DENIED. Regional Director – NO RESPONSE.

CTA – PARTIAL GRANT. CTA ruled that Contex misread Sections 106(A)(2)(a) and 112(A) of the Tax Code. These provisions apply only to those entities registered as VAT taxpayers whose sales are zero-rated. Contex does not fall under this category, since it is a non-VAT taxpayer as evidenced by the Certificate of Registration.

Nonetheless, the CTA held that the Contex is exempt from the imposition of input VAT on its purchases of supplies and materials. It pointed out that under Bases Conversion and Development Act of 1992 (RA 7227), all that Contex is required to pay as a SBFZ-registered enterprise is a 5% preferential tax.

The CTA also disallowed all refunds of input VAT paid prior to June 29, 1997 for being barred by the two-year prescriptive period under Section 229 of the Tax Code. The tax court also limited the refund only to the input VAT paid on the supplies and materials directly used in manufacture of its goods. It struck down all claims for input VAT paid on maintenance, office

10

supplies, freight charges, and all materials and supplies shipped or delivered to the Contex’s Makati and Pasay City offices.

CA – REVERSED. CIR maintained that the exemption of Contex under Rep. Act No. 7227 was limited only to direct taxes and not to indirect taxes such as the input component of the VAT. The Commissioner pointed out that from its very nature, the value-added tax is a burden passed on by a VAT registered person to the end users; hence, the direct liability for the tax lies with the suppliers and not Contex.

Court of Appeals held that the exemption from duties and taxes on the importation of raw materials, capital, and equipment of SBFZ-registered enterprises under Rep. Act No. 7227 and its implementing rules covers only "the VAT imposable under Section 107 of the [Tax Code], which is a direct liability of the importer, and in no way includes the value-added tax of the seller-exporter the burden of which was passed on to the importer as an additional costs of the goods."

SC - DENIED

VAT is an indirect tax. As such, the amount of tax paid on the goods, properties or services bought, transferred, or leased may be shifted or passed on by the seller, transferor, or lessor to the buyer, transferee or lessee. Unlike a direct tax, such as the income tax, which primarily taxes an individual’s ability to pay based on his income or net wealth, an indirect tax, such as the VAT, is a tax on consumption of goods, services, or certain transactions involving the same. The VAT, thus, forms a substantial portion of consumer expenditures.

Further, in indirect taxation, there is a need to distinguish between the liability for the tax and the burden of the tax. As earlier pointed out, the amount of tax paid may be shifted or passed on by the seller to the buyer. What is transferred in such instances is not the liability for the tax, but the tax burden. In adding or including the VAT due to the selling price, the seller remains the person primarily and legally liable for the payment of the tax. What is shifted only to the intermediate buyer and ultimately to the final purchaser is the burden of the tax. Stated differently, a seller who is directly and legally liable for payment of an indirect tax, such as the VAT on goods or services is not necessarily the person who ultimately bears the burden of the same tax. It is the final purchaser or consumer of such goods or services who, although not directly and legally liable for the payment thereof, ultimately bears the burden of the tax

Exemptions from VAT are granted by express provision of the Tax Code or special laws. Under VAT, the transaction can have preferential treatment in the following ways:

(a) VAT Exemption. An exemption means that the sale of goods or properties and/or services and the use or lease of properties is not subject to VAT (output tax) and the seller is not allowed any tax credit on VAT (input tax) previously paid.20 This is a case wherein the VAT is removed at the exempt stage (i.e., at the point of the sale, barter or exchange of the goods or properties).

The person making the exempt sale of goods, properties or services shall not bill any output tax to his customers because the said transaction is not subject to VAT. On the other hand, a VAT-registered purchaser of VAT-exempt goods/properties or services which are exempt from VAT is not entitled to any input tax on such purchase despite the issuance of a VAT invoice or receipt.21

(b) Zero-rated Sales. These are sales by VAT-registered persons which are subject to 0% rate, meaning the tax burden is not passed on to the purchaser. A zero-rated sale by a VAT-registered person, which is a taxable transaction for VAT purposes, shall not result in any output tax. However, the input tax on his purchases of goods, properties or services related to such zero-rated sale shall be available as tax credit or refund in accordance with these regulations.22

Under Zero-rating, all VAT is removed from the zero-rated goods, activity or firm. In contrast, exemption only removes the VAT at the exempt stage, and it will actually increase, rather than reduce the total taxes paid by the exempt firm’s business or non-retail customers. It is for this reason that a sharp distinction must be made between zero-rating and exemption in designating a value-added tax.23

Apropos, the Contex’s claim to VAT exemption in the instant case for its purchases of supplies and raw materials is founded mainly on Section 12 (b) and (c) of Rep. Act No. 7227, which basically exempts them from all national and local internal revenue taxes, including VAT and Section 4 (A)(a) of BIR Revenue Regulations No. 1-95.24

On this point, Contex rightly claims that it is indeed VAT-Exempt and this fact is not controverted by the respondent. In fact, Contex is registered as a NON-VAT taxpayer per Certificate of Registration25 issued by the BIR. As such, it is exempt from VAT on all its sales and importations of goods and services.

While it is true that the Contex should not have been liable for the VAT inadvertently passed on to it by its supplier since such is a zero-rated sale on the part of the supplier, the Contex is not the proper party to claim such VAT refund.

Since the transaction is deemed a zero-rated sale, Contex’s supplier may claim an Input VAT credit with no corresponding Output VAT liability. Congruently, no Output VAT may be passed on to the petitioner.

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Contex is registered as a NON-VAT taxpayer and thus, is exempt from VAT. As an exempt VAT taxpayer, it is not allowed any tax credit on VAT (input tax) previously paid. In fine, even if we are to assume that exemption from the burden of VAT on petitioner’s purchases did exist, petitioner is still not entitled to any tax credit or refund on the input tax previously paid as petitioner is an exempt VAT taxpayer.

Rather, it is the Contex’s suppliers who are the proper parties to claim the tax credit and accordingly refund the Contex of the VAT erroneously passed on to the latter.

Accordingly, we find that the Court of Appeals did not commit any reversible error of law in holding that petitioner’s VAT exemption under Rep. Act No. 7227 is limited to the VAT on which it is directly liable as a seller and hence, it cannot claim any refund or exemption for any input VAT it paid, if any, on its purchases of raw materials and supplies.

[G.R. No. 153866.  February 11, 2005]

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. SEAGATE TECHNOLOGY (PHILIPPINES), respondent.

D E C I S I O N

PANGANIBAN, J.:

Business companies registered in and operating from the Special Economic Zone in Naga, Cebu -- like herein respondent -- are entities exempt from all internal revenue taxes and the implementing rules relevant thereto, including the value-added taxes or VAT.  Although export sales are not deemed exempt transactions, they are nonetheless zero-rated.  Hence, in the present case, the distinction between exempt entities and exempt transactions has little significance, because the net result is that the taxpayer is not liable for the VAT.  Respondent, a VAT-registered enterprise, has complied with all requisites for claiming a tax refund of or credit for the input VAT it paid on capital goods it purchased.  Thus, the Court of Tax Appeals and the Court of Appeals did not err in ruling that it is entitled to such refund or credit.

The Case

Before us is a Petition for Review under Rule 45 of the Rules of Court, seeking to set aside the May 27, 2002 Decision of the Court of Appeals (CA) in CA-GR SP No. 66093.  The decretal portion of the Decision reads as follows:

“WHEREFORE, foregoing premises considered, the petition for review is DENIED for lack of merit.

The Facts

The CA quoted the facts narrated by the Court of Tax Appeals (CTA), as follows:

“As jointly stipulated by the parties, the pertinent facts x x x involved in this case are as follows:

1.  [Respondent] is a resident foreign corporation duly registered with the Securities and Exchange Commission to do business in the Philippines, with principal office address at the new Cebu Township One, Special Economic Zone, Barangay Cantao-an, Naga, Cebu;

2.  [Petitioner] is sued in his official capacity, having been duly appointed and empowered to perform the duties of his office, including, among others, the duty to act and approve claims for refund or tax credit;

3.  [Respondent] is registered with the Philippine Export Zone Authority (PEZA) and has been issued PEZA Certificate No. 97-044 pursuant to Presidential Decree No. 66, as amended, to engage in the manufacture of recording components primarily used in computers for export.  Such registration was made on 6 June 1997;

4.  [Respondent] is VAT [(Value Added Tax)]-registered entity as evidenced by VAT Registration Certification No. 97-083-000600-V issued on 2 April 1997;

5.  VAT returns for the period 1 April 1998 to 30 June 1999 have been filed by [respondent];

6.  An administrative claim for refund of VAT input taxes in the amount of P28,369,226.38 with supporting documents (inclusive of the P12,267,981.04 VAT input taxes subject of this Petition for Review), was filed on 4 October 1999 with Revenue District Office No. 83, Talisay Cebu;

7.  No final action has been received by [respondent] from [petitioner] on [respondent’s] claim for VAT refund.

“The administrative claim for refund by the [respondent] on October 4, 1999 was not acted upon by the [petitioner] prompting the [respondent] to elevate the case to [the CTA] on July 21, 2000 by way of Petition for Review in order to toll the running of the two-year prescriptive period.

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“For his part, [petitioner] x x x raised the following Special and Affirmative Defenses, to wit:

1.  [Respondent’s] alleged claim for tax refund/credit is subject to administrative routinary investigation/examination by [petitioner’s] Bureau;

2.  Since ‘taxes are presumed to have been collected in accordance with laws and regulations,’ the [respondent] has the burden of proof that the taxes sought to be refunded were erroneously or illegally collected x x x;

3.  In Citibank, N.A. vs. Court of Appeals, 280 SCRA 459 (1997), the Supreme Court ruled that:

“A claimant has the burden of proof to establish the factual basis of his or her claim for tax credit/refund.”

4.  Claims for tax refund/tax credit are construed in ‘strictissimi juris’ against the taxpayer.  This is due to the fact that claims for refund/credit [partake of] the nature of an exemption from tax.  Thus, it is incumbent upon the [respondent] to prove that it is indeed entitled to the refund/credit sought.  Failure on the part of the [respondent] to prove the same is fatal to its claim for tax credit.  He who claims exemption must be able to justify his claim by the clearest grant of organic or statutory law.  An exemption from the common burden cannot be permitted to exist upon vague implications;

5.  Granting, without admitting, that [respondent] is a Philippine Economic Zone Authority (PEZA) registered Ecozone Enterprise, then its business is not subject to VAT pursuant to Section 24 of Republic Act No. ([RA]) 7916 in relation to Section 103 of the Tax Code, as amended.  As [respondent’s] business is not subject to VAT, the capital goods and services it alleged to have purchased are considered not used in VAT taxable business.  As such, [respondent] is not entitled to refund of input taxes on such capital goods pursuant to Section 4.106.1 of Revenue Regulations No. ([RR])7-95, and of input taxes on services pursuant to Section 4.103 of said regulations.

6.  [Respondent] must show compliance with the provisions of Section 204 (C) and 229 of the 1997 Tax Code on filing of a written claim for refund within two (2) years from the date of payment of tax.’

“On July 19, 2001, the Tax Court rendered a decision granting the claim for refund.”

Ruling of the Court of Appeals

The CA affirmed the Decision of the CTA granting the claim for refund or issuance of a tax credit certificate (TCC) in favor of respondent in the reduced amount of P12,122,922.66.  This sum represented the unutilized but substantiated input VAT paid on capital goods purchased for the period covering April 1, 1998 to June 30, 1999.

The appellate court reasoned that respondent had availed itself only of the fiscal incentives under Executive Order No. (EO) 226 (otherwise known as the Omnibus Investment Code of 1987), not of those under both Presidential Decree No. (PD) 66, as amended, and Section 24 of RA 7916.  Respondent was, therefore, considered exempt only from the payment of income tax when it opted for the income tax holiday in lieu of the 5 percent preferential tax on gross income earned.  As a VAT-registered entity, though, it was still subject to the payment of other national internal revenue taxes, like the VAT.

Moreover, the CA held that neither Section 109 of the Tax Code nor Sections 4.106-1 and 4.103-1 of RR 7-95 were applicable.  Having paid the input VAT on the capital goods it purchased, respondent correctly filed the administrative and judicial claims for its refund within the two-year prescriptive period.  Such payments were -- to the extent of the refundable value -- duly supported by VAT invoices or official receipts, and were not yet offset against any output VAT liability.

Hence this Petition.

Sole Issue

Petitioner submits this sole issue for our consideration:

“Whether or not respondent is entitled to the refund or issuance of Tax Credit Certificate in the amount of P12,122,922.66 representing alleged unutilized input VAT paid on capital goods purchased for the period April 1, 1998 to June 30, 1999.”

The Court’s Ruling

The Petition is unmeritorious.

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PICART V. SMITH

Facts:

Plaintiff Amado Picart was riding on his pony on the Carlatan Bridge in San Fernando, La Union when the defendant, riding on his car, approached. Defendant blew his horn to give warning. Plaintiff moved the horse to the right instead of moving to the left, reasoning that he had no sufficient time to move to the right direction. Defendant continued to approach, and when he had gotten quite near, he quickly turned to the left. The horse was frightened that it turned his body across the bridge. His limb was broken and the rider was thrown off and got injured. The horse died. An action for damages was filed against the defendant.

Issue:

Whether or not the defendant in maneuvering his car in the manner above described was guilty of negligence such as gives rise to a civil obligation to repair the damage done

Held:

As the defendant started across the bridge, he had the right to assume that the horse and rider would pass over to the proper side; but as he moved toward the center of the bridge it was demonstrated to his eyes that this would not be done; and he must in a moment have perceived that it was too late for the horse to cross with safety in front of the moving vehicle. In the nature of things this change of situation occurred while the automobile was yet some distance away; and from this moment it was not longer within the power of the plaintiff to escape being run down by going to a place of greater safety. The control of the situation had then passed entirely to the defendant.

The test by which to determine the existence of negligence in a particular case may be stated as follows: Did the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence. Conduct is said to be negligent when a prudent man in the position of the tortfeasor would have foreseen that an effect harmful to another was sufficiently probable to warrant his foregoing the conduct or guarding against its consequences.

It goes without saying that the plaintiff himself was not free from fault, for he was guilty of antecedent negligence in planting himself on the wrong side of the road. But as we have already stated, the defendant was also negligent; and in such case the problem always is to discover which agent is immediately and directly responsible. It will be noted that the negligent acts of the two parties were not contemporaneous, since the negligence of the defendant succeeded the negligence of the plaintiff by an appreciable interval. Under these circumstances the law is that the person who has the last fair chance to avoid the impending harm and fails to do so is chargeable with the consequences, without reference to the prior negligence of the other party.

Ayala Corporation VS. ROSA DIANA REALTY Case DigestAyala Corporation VS. ROSA DIANA REALTY

346 SCRA 633

FACTS: In April 1976, appellant-petitioner entered into a transaction with Manuel Sy and Sy Ka Kieng where former sold a lot in Salcedo Village in Makati. The deed of sale had some encumbrances contained in the Special Conditions of Sale (SCS) and Deed of Restrictions (DR), which should be followed by the vendees. The stipulations in the SCS are:

1) a building proposal must be submitted to Ayala which must be in accordance with the DR,

2) the construction of the building must be completed on or before 1979, and

3) that there will be no resale of the lot.

The DR specified the limits in height and floor area of the building to be constructed. However, Sy and Kieng, failed to build a building but nonetheless with the permission of Ayala, the vendees sold the said lot to the respondent, Rosa Diana Realty. Respondent Company agreed to abode by the SCS and the DR stipulations. Prior to the construction, Rosa Diana submitted a building plan to Ayala complying with the DR but it also passed a different building plan to the building administrator of Makati, which did not comply with the stipulations in the DR. While the building, “The Peak,” was being constructed, Ayala filed a case praying that: 1) Rosa Diana, be compelled to comply with the DR and build the building in accordance with the building plan submitted to Ayala; or 2) on the alternative, the rescission of the deed of sale.

14

The trial court ruled in favor of the respondent and thus, Rosa Diana was able to complete the construction of “The Peak.” Undeterred, Ayala filed before the Register of Deeds (RD) of Makati a cause of annotation lis pendens. RD refused to grant Ayala such registration for in the lower court; the case is of personal action for a specific performance and/or rescission. However, the Land Registration Authority (LRA) reversed RD’s ruling. The appellate court upheld the RD’s ruling stating that the case before the trial court is a personal action for the cause of action arises from the alleged violation of the DR. The trial court sustained the respondent’s point saying that Ayala was guilty of abandonment and/or estoppels due to its failure to enforce the terms of the DR and SCS against Sy and Kieng. Ayala discriminately chose which obligor would be made to follow certain conditions, which is not fair and legal. On appeal, the CA affirmed the lower court’s ruling. Hence, this petition.

ISSUE: Whether or not Rosa Diana committed a breach of contract.

RULING: Yes, the Supreme Court ruled that Rosa Diana committed a breach of contract by submitting a building plan to Ayala complying with the DR and submitting a different building plan to the building administrator of Makati, which did not comply with the stipulations in the DR.

Contractual Obligations between parties have the force of law between them and absent any allegation that the same are contrary to law, morals, good customs, public order or public policy, they must complied with in good faith.

Thus, the assailed decision of the Court of Appeals is reversed and set aside.

ST. MARY’S ACADEMY VS CARPITANOS, 6 FEBRUARY 2002

Facts:

For the school year 1995-1996, St. Mary's Academy of Dipolog City conducted an enrollmentdrive through visitation of

other schools where prospective high school enrollees were studying. Among the students of SMA who took part in the

campaign was Sherwin and James. Sherwin and other high school students were riding in aMitsubishi jeep owned by

Vivencio Villanueva and driven by  by James, then 15 years old. On their way to Dapitan City, the jeep turned turtle

resulting in the death of Sherwin. 

The parents of Sherwin thus sued James and his parents, Vicente and SMA. At the trial, the traffic  investigator testified

and submitted his report showing that the jeep turned turtle because the steering wheel guide of the jeep was detached.

This report and the testimony of the traffic investigator was notdisputed by any of the parties. 

After trial, the lower court held that the school is primary liable for damages as it had special parental authority at the time

of the accident. The parents of Dino were found to be only subsidiarily liable and were ordered to pay only in the event of

insolvency of the school. Dino was absolved for being only a minor under the special parental authority of the school.

Vivencio, the vehicle owner was not held liable at all. 

Issue:

Was the lower court correct? 

Held:

No. 

15

Under Article 218 of the Family Code, the following shall have special parental authority over a minor child while under

their supervision, instruction or custody: (1) the school, its administrators and teachers; or (2) the individual, entity or

institution engaged in child care. 

This special parental authority and responsibility applies to all authorized activities, whether inside or outside the premises

of the school, entity or institution. Thus, such authority and responsibility applies to field trips, excursions and other affairs

of the pupils and students outside the school premises whenever authorized by the school or its teachers.

Under Article 219 of the Family Code, if the person under custody is a minor, those exercising special parental authority

are principally and solidarily liable for damages caused by the acts or omissions of the unemancipated minor while under

their supervision, instruction, or custody.

However, for   the school   to be liable, there must be a finding that the act or omission considered as negligent was the

proximate cause of the death or injury sustained. Injury for which recovery is sought must be the legitimate consequence

of the wrong done.   Negligence , no matter in what it consists, cannot create a right of action unless it is the proximate

cause of the injury complained of. And the proximate cause of an injury is that cause which, in natural and continuous

sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have

occurred. 

In this case, the parents of Sherwin failed to show that the proximate cause of the accident was the negligence of  the

school authorities. They admitted that the immediate cause of the accident was not the negligence of SMA or the reckless

driving of James, but the detachment of the steering wheel guide of the jeep. Hence reliance on Art. 219, of the Family

Code is unfounded. 

Further, it was Ched the grandson of the vehicle owner Vivencio who allowed the minor James to drive the jeep at the

time of the accident. The school did not allow James to drive the jeep. So whether the accident was caused by the

reckless driving of James or the mechanical detachment of the steering wheelguide of the jeep, the school could not be

held liable since these are events which it had no control. If the school may be considered negligent, it was only the

remote cause of the accident. Between the remote cause and the injury, there intervened the negligence of the minor’s

parents or the detachment of thesteering wheel guide of the jeep. 

At any rate, since it is clear that the accident occurred because of the detachment of the steering wheel guide of the jeep,

it is not the school but theregistered owner of the vehicle who should be held responsible for damages forthe death

of Sherwin. Registered owner of any vehicle, even if not used for public service, would primarily be responsible to the

public or to third persons for injuries caused the latter while the vehicle was being driven on the highways or streets. (St.

Mary’s Academy vs. Carpitanos et. al G.R.143363, February 6,2002).

ETERNAL GARDENS MEMORIAL PARK CORPORATION, petitioner, vs.COURT OF APPEALS and SPS. LILIA SEVILLA and JOSE SEELIN, respondents.

FACTS:  Judgment was rendered against the petitioner ordering it to reconvey the cemetery to the rightful owners, private respondent sps. Sevilla.  Despite the final decision of the SC, petitioner was able to prevent the execution for filing petitions for certiorari arguing that the judgment cannot be executed against it because it was not a party to Civil Case No. C-9297; that the decision of the trial court in said case never mandated Central Dyeing to deliver possession of the property to the private respondents; that certain facts and circumstances which occurred after the finality of the judgment will render the execution highly unjust, illegal and inequitable; that the issuance of the assailed writ of execution violates the lot buyers' freedom of religion and worship; and that private respondents' title is being questioned in another case to the cause that the case to be pending for 17 years, and thus render the judgment ineffectual. 

They filed several petitions and motions for reconsideration with the trial court and the CA despite the fact that it would never prosper as the trial court’s decision had long become final before the said petitions were filed.

HELD:  Petition denied.  While lawyers owe their entire devotion to the interest of the client and zeal in the defense of their client’s right, they are also officers of the court, bound to exert every effort to assist in the speedy and efficient administration of justice. 

They should not misuse the rules of procedure to defeat the ends of justice or unduly delay a case, impede the execution of a judgment or misuse court processes.  The facts and the law should advise them that a

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case such as this should not be permitted to be filed to merely clutter the already congested judicial dockets.  They do not advance the cause of law or their clients by commencing litigations that for sheer lack of merit do not deserve the attention of the courts.

The mere continuation of petitioners’ dilatory tactics to that the respondents will not benefit from the final judgment. The fear of the petitioner regarding the disturbance of the grave lots was more imagined than true because in the writ of execution, the presiding judge imposed that the enforcement of the writ of possession and break open order should be applied only to the gate of Eternal Gardens Memorial Park at the eastern side nearest to the parcel of land in question where the factory of the defendant(Central Dyeing) is located, in order to avoid disturbing the peace of the resting souls over the graves the parcels of land within the said memorial park.

It has been known that the petition of the private respondents has been moot and academic and that they had took possession of the lot. To the end that:

This case delayed the execution of a final judgment for seventeen (17) years to the prejudice of the private respondents. In the meantime that petitioner has thwarted execution, interment on the disputed lot has long been going on, so that by the time this case is finally terminated, the whole lot shall have already been filled with tombstones, leaving nothing for private respondents, the real owners of the property. This is a mockery of justice.

NIKKO HOTEL VS. REYESGR No. 154259, February 28, 2005

FACTS:

Petitioners Nikko Hotel Manila and Ruby Lim assailed the decision of the Court of Appeals in reversing the decision of RTC of Quezon City.  CA held petitioner liable for damages to Roberto Reyes aka “Amang Bisaya”, an entertainment artist.

There are two versions of the story:Mr. Reyes: On the eve of October 13, 1994, Mr. Reyes while having coffee at the lobby of Nikko Hotel was approached by Dr. Violet Filart, a friend several years back.  According to Mr. Reyes, Dr. Filart invited him to join a birthday party at the penthouse for the hotel’s former General Manager, Mr. Tsuruoka.  Plaintiff agreed as Dr. Filart agreed to vouch for him and carried a basket of fruits, the latter’s gift.  He He lined up at the buffet table as soon as it was ready but to his great shock, shame and embarrassment, Ruby Lim, Hotel’s Executive Secretary, asked him to leave in a loud voice enough to be heard by the people around them.  He was asked to leave the party and a Makati policeman accompanied him to step-out the hotel.  All these time, Dr Filart ignored him adding to his shame and humiliation.

Ms. Ruby Lim: She admitted asking Mr. Reyes to leave the party but not in the manner claimed by the plaintiff.  Ms. Lim approached several people including Dr. Filart’s sister, Ms. Zenaida Fruto, if Dr. Filart did invite him as the captain waiter told Ms. Lim that Mr. Reyes was with Dr. Filart’s group.  She wasn’t able to ask it personally with Dr. Filart since the latter was talking over the phone and doesn’t want to interrupt her.  She asked Mr. Reyes to leave because the celebrant specifically ordered that the party should be intimate consisting only of those who part of the list.  She even asked politely with the plaintiff to finish his food then leave the party.

During the plaintiff’s cross-examination, he was asked how close was Ms. Lim when she approached him at the buffet table.  Mr. Reyes answered “very close because we nearly kissed each other”.  Considering the close proximity, it was Ms. Lim’s intention to relay the request only be heard by him.  It was Mr. Reyes who made a scene causing everybody to know what happened.

ISSUE: Whether or not petitioners acted abusively in asking Mr. Reyes to leave the party.

HELD:

Supreme Court held that petitioners did not act abusively in asking Mr. Reyes to leave the party.  Plaintiff failed to establish any proof of ill-motive on the part of Ms. Lim who did all the necessary precautions to ensure that Mr. Reyes will not be humiliated in requesting him to leave the party.  Considering almost 20 years of experience in the hotel industry, Ms. Lim is experienced enough to know how to handle such matters.   Hence, petitioners will not be held liable for damages brought under Article 19 and 20 of the Civil Code.

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Gonzales v Katigbak G.R. No. L-69500 July 22, 1985

Facts:

Antonio Gonzales, president of Malaya Films, claimed that his film Kapit sa Patalim, was rated for adults only by a

subcommittee of the movie review board together with the required cuts and scene deletions. He justified that these

requirements were without basis and were restrains on artistic expression. He adduced that the film is an integral whole

and all its portions, including those to which the Board now offers belated objection, are essential for the integrity of

the film. Viewed as a whole, there is no basis even for the vague speculations advanced by the Board as basis for its

classification.

He appealed to the movie review board but the same affirmed the decion of the sub committee.

When Gonzales appealed to the supreme court, the board claimed that the deletions were removed and the requirement

to submit the master negative was taken out but the film was still rated for adults only. The petition was amended to

contest the rating only.

Issue:

Was the rating made with grave avuse of discretion (Note I put in those regarding obscenity for future purposes)

Held:

No. Petition dismissed. There was no grave abuse of discretion DUE TO LACK OF VOTES

Ratio:

Motion pictures are important both as a medium for the communication of Ideas and the expression of the artistic impulse

Burstyn-importance of motion pictures as an organ of public opinion lessened by the fact that they are designed to

entertain as well as to inform

(No clear dividing line between what affords knowledge and that of pleasure or else there will be a diminution to a right to

self-expression)

Bagatsing- Press freedom may be identified with the liberty to discuss publicly and truthfully any matter of public concern

without censorship or punishment. This is not to say that such freedom, as is the freedom of speech, absolute. It can be

limited if "there be a 'clear and present danger of a substantive evil that [the State] has a right to prevent.”

Censorship doesn’t full cover free speech or there might bean emasculation of basic rights. However, there must be in

exceptional circumstances a sine qua non for the meaningful exercise of such right without denying the freedom from

liability.

Freedom from censorship is a settled principle in our jurisdiction. Mutuc- board of review is limited to classification

of films to safeguard other constitutional objections, hence the GP, PG, or R-18 ratings.

That is to abide by the principle that freedom of expression is the rule and restrictions the exemption. The power to

exercise prior restraint is not to be presumed, rather the presumption is against its validity

The test, to repeat, to determine whether freedom of expression may be limited is the clear and present danger of an evil

of a substantive character that the State has a right to prevent. Such danger must not only be clear but also present.

There should be no doubt that what is feared may be traced to the expression complained of. The causal connection must

be evident. Also, there must be reasonable apprehension about its imminence. The time element cannot be ignored. Nor

does it suffice if such danger be only probable.

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Where movies are concerned, censorship, especially so if an entire production is banned, is allowable only under the

clearest proof of a clear and present danger of a substantive evil to public public morals, public health or any other

legitimate public interest.

Roth- "All Ideas having even the slightest redeeming social importance — unorthodox Ideas, controversial Ideas, even

Ideas hateful to the prevailing climate of opinion — have the full protection of the guaranties, unless excludable because

they encroach upon the limited area of the First Amendment is the rejection of obscenity as utterly without redeeming

social importance.”

Given obscenity as the nemesis of censorship, there is difficulty in determining what is obsecene.

Roth- The early leading standard of obscenity allowed material to be judged merely by the effect of an isolated excerpt

upon particularly susceptible persons

The test was whether to the average person, applying contemporary community standards, the dominant theme of the

material taken as a whole appeals to prurient interest. Some material can legitimately deal with sex and its effects on

susceptible persons. Such a censorship can be considered violative of the constitution. On the other hand, the substituted

standard provides safeguards adequate to withstand the charge of constitutional infirmity.

Roth- Sex and obscenity are not synonymous. Obscene material is material which deals with sexin a manner appealing to

prurient interest. The portrayal of sex, e.g., in art, literature and scientific works, is not itself sufficient reason to deny

material the constitutional protection of freedom of speech and press. Sex, a great and mysterious motive force in human

life has indisputably been a subject of absorbing interest to mankind through the ages; it is one of the vital problems of

human interest and public concern.

In the Philippine context, E.O. 876 applied contemporary Filipino cultural values as a standard.

Moreover, as far as the question of sex and obscenity are concerned, it cannot be stressed strongly that the arts and

letters "shall be under the patronage of the State.

Given this constitutional mandate, It will be less than true to its function if any government office or agency would invade

the sphere of autonomy that an artist enjoys. There is no orthodoxy in whatpasses for beauty or for reality. It is for the

artist to determine what for him is a true representation. It is not to be forgotten that art and belleslettres deal primarily with

imagination, not so much with ideas in a strict sense. What is seen or perceived by an artist is entitled to respect, unless

there is a showing that the product of his talent rightfully may be considered obscene.

On the question of obscenity, therefore, such standard set forth in Executive Order No. 878 is to be construed in such a

fashion to avoid any taint of unconstitutionality. To repeat, what was stated in a recent decision in Trinidad- an

elementary, a fundamental, and a universal role ofconstruction, applied when considering constitutional questions, that

when a law is susceptible of two constructions' one of which will maintain and the other destroy it, the courts will always

adopt the former.

There can be no valid objection to the controlling standard.

There was really a grave abuse of discretion when the Board and its perception of what obscenity is is very restrictive.

But, sadly, THERE WERE NOT ENOUGH VOTES TO MAINTAIN THAT THERE WAS GRAVE ABUSE OF DISCRETION.

The supporting evidence was in the fact that some scenes were not for young people. They might misunderstand the

scenes.  The respondents offered to make it GP if the petitioners would remove the lesbian and sex scenes. But they

refused.

The ruling is to be limited to the concept of obscenity applicable to motion pictures. It is the consensus of this Court that

where television is concerned: a less liberal approach calls for observance. This is so because unlike motion pictures

where the patrons have to pay their way, television reaches every home where there is a set.

It is hardly the concern of the law to deal with the sexual fantasies of the adult population. It cannot be denied though that

the State as parens patriae is called upon to manifest an attitude ofcaring for the welfare of the young.

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PEOPLE VS. JALOSJOS

Facts:

The accused-appellant, Romeo Jalosjos, is a full-fledged member of Congress who is confined at the national penitentiary while his conviction for statutory rape and acts of lasciviousness is pending appeal. The accused-appellant filed a motion asking that he be allowed to fully discharge the duties of a Congressman, including attendance at legislative sessions and committee meetings despite his having been convicted in the first instance of a non-bailable offense.

Jalosjos’ primary argument is the "mandate of sovereign will." He states that the sovereign electorate of the First District of Zamboanga del Norte chose him as their representative in Congress. Having been re-elected by his constituents, he has the duty to perform the functions of a Congressman. He calls this a covenant with his constituents made possible by the intervention of the State. He adds that it cannot be defeated by insuperable procedural restraints arising from pending criminal cases.

Jalosjos also invoked the doctrine of condonation citing Aguinaldo v. Santos, which states, inter alia, that –

The Court should never remove a public officer for acts done prior to his present term of office. To do otherwise would be to deprive the people of their right to elect their officers. When a people have elected a man to office, it must be assumed that they did this with the knowledge of his life and character, and that they disregarded or forgave his fault or misconduct, if he had been guilty of any. It is not for the Court, by reason of such fault or misconduct, to practically overrule the will of the people.

Jalosjos further argues that on several occasions, the Regional Trial Court of Makati granted several motions to temporarily leave his cell at the Makati City Jail, for official or medical reasons.

Jalosjos avers that his constituents in the First District of Zamboanga del Norte want their voices to be heard and that since he is treated as bona fide member of the House of Representatives, the latter urges a co-equal branch of government to respect his mandate.

Issue:

Whether or not accused-appellant should be allowed to discharge mandate as member of House of Representatives

Held:

NO.

The privilege of arrest has always been granted in a restrictive sense.

True, election is the expression of the sovereign power of the people. However, in spite of its importance, the privileges and rights arising from having been elected may be enlarged or restricted by law. Privilege has to be granted by law, not inferred from the duties of a position. In fact, the higher the rank, the greater is the requirement of obedience rather than exemption.

Section 11, Article VI, of the Constitution provides:

A Senator or Member of the House of Representatives shall, in all offenses punishable by not more than six years imprisonment, be privileged from arrest while the Congress is in session. xxx

The immunity from arrest or detention of Senators and members of the House of Representatives, arises from a provision of the Constitution. The history of the provision shows that the privilege has always been granted in a restrictive sense.The provision granting an exemption as a special privilege cannot be extended beyond the ordinary meaning of its terms. It may not be extended by intendment, implication or equitable considerations.

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The accused-appellant has not given any reason why he should be exempted from the operation of Sec. 11, Art. VI of the Constitution. The members of Congress cannot compel absent members to attend sessions if the reason for the absence is a legitimate one. The confinement of a Congressman charged with a crime punishable by imprisonment of more than six years is not merely authorized by law, it has constitutional foundations.

Doctrine of condonation does not apply to criminal cases

The Aguinaldo case involves the administrative removal of a public officer for acts done prior to his present term of office. It does not apply to imprisonment arising from the enforcement of criminal law. Moreover, in the same way that preventive suspension is not removal, confinement pending appeal is not removal. He remains a congressman unless expelled by Congress or, otherwise, disqualified.

One rationale behind confinement, whether pending appeal or after final conviction, is public self-defense. Society must protect itself. It also serves as an example and warning to others.

Emergency or compelling temporary leaves from imprisonment are allowed to all prisoners.

There is no showing that the above privileges are peculiar to him or to a member of Congress. Emergency or compelling temporary leaves from imprisonment are allowed to all prisoners, at the discretion of the authorities or upon court orders.

To allow accused-appellant to attend congressional sessions and committee meetings will virtually make him a free man

When the voters of his district elected the accused-appellant to Congress, they did so with full awareness of the limitations on his freedom of action. They did so with the knowledge that he could achieve only such legislative results which he could accomplish within the confines of prison. To give a more drastic illustration, if voters elect a person with full knowledge that he is suffering from a terminal illness, they do so knowing that at any time, he may no longer serve his full term in office.

To allow accused-appellant to attend congressional sessions and committee meetings for 5 days or more in a week will virtually make him a free man with all the privileges appurtenant to his position. Such an aberrant situation not only elevates accused-appellant’s status to that of a special class , it also would be a mockery of the purposes of the correction system.

In the ultimate analysis, the issue before us boils down to a question of constitutional equal protection.

The Constitution guarantees: "x x x nor shall any person be denied the equal protection of laws." This simply means that all persons similarly situated shall be treated alike both in rights enjoyed and responsibilities imposed. The organs of government may not show any undue favoritism or hostility to any person. Neither partiality nor prejudice shall be displayed.

Does being an elective official result in a substantial distinction that allows different treatment? Is being a Congressman a substantial differentiation which removes the accused-appellant as a prisoner from the same class as all persons validly confined under law?

The performance of legitimate and even essential duties by public officers has never been an excuse to free a person validly in prison.

The Court cannot validate badges of inequality. The necessities imposed by public welfare may justify exercise of government authority to regulate even if thereby certain groups may plausibly assert that their interests are disregarded.

We, therefore, find that election to the position of Congressman is not a reasonable classification in criminal law enforcement. The functions and duties of the office are not substantial distinctions which lift him from the class of prisoners interrupted in their freedom and restricted in liberty of movement. Lawful arrest and confinement are germane to the purposes of the law and apply to all those belonging to the same class. (People vs. Jalosjos G.R. Nos. 132875-76. February 3, 2000)

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G.R. No. L-14639 March 25, 1919ZACARIAS VILLAVICENCIO, ET AL. vs. JUSTO LUKBAN, ET AL.

Issue:

The writ of Habeas Corpus was filed by the petitioner, with the prayer that the respondent produce around 170 women

whom Justo Lukban et, al deported to Davao. Liberty of abode was also raised versus the power of the executive of the

Municipality in deporting the women without their knowledge in his capacity as Mayor.

Facts:

Justo Lukban as Manila City's Mayor together with Anton Hohmann, the city's Chief of Police, took custody of about 170

women at the night of October 25 beyond the latters consent and knowledge and thereafter were shipped to Mindanao

specifically in Davao where they were signed as laborers. Said women are inmates of the houses of prostitution situated

in Gardenia Street, in the district of Sampaloc.

That when the petitioner filed for habeas corpus, the respondent moved to dismiss the case saying that those women

were already out of their jurisdiction and that , it should be filed in the city of Davao instead.

The court ruled in favor of the petitioner with the instructions;

For the respondents to have fulfilled the court's order, three optional courses were open: (1) They could have produced

the bodies of the persons according to the command of the writ; or (2) they could have shown by affidavit that on account

of sickness or infirmity those persons could not safely be brought before the court; or (3) they could have presented

affidavits to show that the parties in question or their attorney waived the right to be present.

Held:

The court concluded the case by granting the parties aggrieved the sum of 400 pesos each, plus 100 pesos for nominal

damage due to contempt of court. Reasoning further that if the chief executive of any municipality in the Philippines could

forcibly and illegally take a private citizen and place him beyond the boundaries of the municipality, and then, when called

upon to defend his official action, could calmly fold his hands and claim that the person was under no restraint and that

he, the official, had no jurisdiction over this other municipality.

We believe the true principle should be that, if the respondent is within the jurisdiction of the court and has it in his power

to obey the order of the court and thus to undo the wrong that he has inflicted, he should be compelled to do so. Even if

the party to whom the writ is addressed has illegally parted with the custody of a person before the application for the writ

is no reason why the writ should not issue. If the mayor and the chief of police, acting under no authority of law, could

deport these women from the city of Manila to Davao, the same officials must necessarily have the same means to return

them from Davao to Manila. The respondents, within the reach of process, may not be permitted to restrain a fellow citizen

of her liberty by forcing her to change her domicile and to avow the act with impunity in the courts, while the person who

has lost her birthright of liberty has no effective recourse. The great writ of liberty may not thus be easily evaded.

TAN V. PEOPLE

Facts:

On October 26, 1989, about 6:30 p.m., in the town proper of Cajidiocan, Sibuyan Island, Romblon, Forest Guards Joseph Panadero and Eduardo Rabino intercepted a dump truck loaded with narra and white lauan lumber.  The truck was driven by Petitioner Fred Moreno, an employee of A & E Construction.  Again, about 8:00 p.m. on October 30, 1989, this time in Barangay Cambajao, Forest Guards Panadero and Rabino apprehended another dump truck with Plate No. DEK-646 loaded with tanguile lumber.  Said truck was driven by Crispin Cabudol, also an employee of A & E Construction.  Both motor vehicles, as well as the construction firm, were owned by Petitioner Alejandro Tan.  In both instances, no documents showing legal possession of the lumber were, upon demand, presented to the forest guards; thus, the pieces of lumber were confiscated.Tan and Moreno, together with Ismael Ramilo, caretaker and timekeeper of A & E Construction, were charged by First Assistant Provincial Prosecutor Felix R. Rocero with violation of Section 68,[6] PD No. 705, as amended by EO No. 277.

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The accused were all convicted for failure to comply with the Forestry Reform Code which requires: (1) an auxiliary invoice, (2) a certificate of origin, (3) a sales invoice, (4) scale/tally sheets and (5) a lumber dealer permit. The CA found no cogent reason for the reversal or modification of the decision.

Issue:(1) Whether or not Section 68 of EO 277 is unconstitutional.(2) Whether or not "lumber" is to be construed as "timber" and/or forest product within the contemplation of PD 705.

Held:(1) Section 68 deals with penalizing the "cutting, gathering and/or collecting timber or other forest products without license.". One of the essential requisites for a successful judicial inquiry into the constitutionality of a law is the existence of an actual case or controversy involving a conflict of legal rights susceptible of judicial determination. As Respondent Court of Appeals correctly pointed out, petitioners were not “charged with the [unlawful] possession of ‘firewood, bark, honey, beeswax, and even grass, shrub, ‘the associated water’ or fish;”  thus,  the inclusion of any of these enumerated items in EO 277 “is absolutely of no concern” to petitioners.  They are not asserting a legal right for which they are entitled to a judicial determination at this time.  Besides, they did not present any convincing evidence of a clear and unequivocal breach of the Constitution that would justify the nullification of said provision. A statute is always presumed to be constitutional, and one who attacks it on the ground of unconstitutionality must convincingly prove its invalidity.

(2) In Mustang Lumber Inc v. CA, Supreme Court held that lumber is included in the term timber. Lumber is a processed log or processed forest raw material.  Clearly, the Code uses the term lumber in its ordinary or common usage.  In the 1993 copyright edition of Webster’s Third New International Dictionary, lumber is defined, inter alia, as ‘timber or logs after being prepared for the market.’  Simply put, lumber is a processed log or timber. To exclude possession of "lumber" from the acts penalized in Section 68 would emasculate the law itself.

PABLO ARIZALA, SERGIO MARIBAO, LEONARDO JOVEN, and FELINO BULANDUSvs.

THE COURT OF APPEALS

FACTS: Under the Industrial Peace Act, 1 government-owned or controlled corporations had the duty to bargain collectively and were otherwise subject to the obligations and duties of employers in the private sector. 2 The Act also prohibited supervisors to become, or continue to be, members of labor organizations composed of rank-and-file employees, 3 and prescribed criminal sanctions for breach of the prohibition. 4

Under the regime of said Industrial Peace Act that the Government Service Insurance System (GSIS, for short) became bound by a collective bargaining agreement executed between it and the labor organization representing the majority of its employees, the GSIS Employees Association. The agreement contained a "maintenance-of-membership" clause

The petitioners occupied supervisory positions in the GSIS. Pablo Arizala and Sergio Maribao were, respectively, the Chief of the Accounting Division, and the Chief of the Billing Section of said Division, in the Central Visayas Regional Office of the GSIS. Leonardo Joven and Felino Bulandus were, respectively, the Assistant Chief of the Accounting Division (sometimes Acting Chief in the absence of the Chief) and the Assistant Chief of the Field Service and Non-Life Insurance Division (and Acting Division Chief in the absence of the Chief), of the same Central Visayas Regional Office of the GSIS. Demands were made on all four of them to resign from the GSIS Employees Association, in view of their supervisory positions.

They refused to do so. Consequently, two (2) criminal cases for violation of the Industrial Peace Act were lodged against them in the City Court of Cebu: one involving Arizala and Maribao 6 and the other, Joven and Bulandus. Which resulted to their conviction.

They argued that when the so called "1973 Constitution" took effect on January 17, 1973 pursuant to Proclamation No. 1104, the case of Arizala and Maribao was still pending in the Court of Appeals and that of Joven and Bulandus, pending decision in the City Court of Cebu; that since the provisions of that constitution and of the Labor Code subsequently promulgated (eff., November 1, 1974), repealing the Industrial Peace Act-placed employees of all categories in government-owned or controlled corporations without distinction within the Civil Service, and provided that the terms and conditions of their employment were to be "governed by the Civil Service Law, rules and regulations" and hence, no longer subject of collective bargaining, the appellants ceased to fall within the coverage of the Industrial Peace Act and should thus no longer continue to be prosecuted and exposed to punishment for a violation thereof. They pointed out further that the criminal sanction in the Industrial Peace Act no longer appeared in the Labor Code

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ISSUE: whether or not the petitioners' criminal liability for a violation of the Industrial Peace Act may be deemed to have been obliterated in virtue of subsequent legislation and the provisions of the 1973 and 1987 Constitutions.

RULING: YES. the right of self-organization and collective bargaining had been withdrawn by the Labor Code from government employees including those in government-owned and controlled corporations- chiefly for the reason that the terms and conditions of government employment, all embraced in civil service, may not be modified by collective bargaining because set by law. It is therefore immaterial, they say, whether supervisors are members of rank-and-file unions or not; after all, the possibility of the employer's control of the members of the union thru supervisors thus rendering collective bargaining illusory, which is the main reason for the prohibition, is no longer of any consequence.

the disappearance from the law of the prohibition on supervisors being members of labor organizations composed of employees under their supervision. The Labor Code (PD 442) allowed supervisors (if not managerial) to join rank-and-file unions. And under the Implementing Rules of RA 6715, supervisors who were members of existing labor organizations on the effectivity of said RA 6715 were explicitly authorized to "remain therein."

that the maintenance by supervisors of membership in a rank-and-file labor organization even after the enactment of a statute imposing a prohibition on such membership, is not only not a crime, but is explicitly allowed, under present law.

The repeal of a penal law deprives the courts of jurisdiction to punish persons charged with a violation of the old penal law prior to its repeal

HANJIN HEAVY INDUSTRIES VS. IBANEZ| GR 170181 | JUNE 26 2008

FACTS

: Felicito Ibanez (tireman), Elmer Gacula (Crane Operator), Elmer Dagotdot (Welder), Aligwas Carolino (Welder), Ruel Calda (Warehouseman)filed a complaint at the NLRC for illegal dismissal with prayer for reinstatement and payment of back wages. The group alleged that the contract they have is good for three months, subject to automatic renewal if there is no notice of termination from Hanjin, and that the contract would automatically terminate upon the completion of the project. They further averred that during the time they were dismissed, the project was still ongoing and Hanjin hired people for the positions that they had vacated. Lastly, they also allege that they are entitled to a completion bonus as part of the industry practice and this was substantiated by past payroll payments. Hanjin failed to furnish a copy of the contract agreements withthe dismissed group. Instead it showed the quitclaims that had been executed by the group that released Hanjin and its representatives from any claims with their employment. It contained clearance certificates that show that respondents are free from accountability.

ISSUE:

WON the members of the dismissed group are project employees?

HELD:

No, Hanjin was unable to prove they were not regular employees The rehiring of construction workers on a project to project basis does not confer upon them regular employment status, since their re-hiring is only a natural consequence of the fact that experienced construction workers are preferred. Employees who are hired for carrying out a separate job, distinct from the other undertakings of the company,

the scope and duration of which has been determined and made known to the employees at the timeof the employment 

, are properly treated as project employees and their services may be lawfully terminated upon the completion of a project. Should the terms of their employment fail to comply with this standard, they cannot be considered project employees. Hanjin was unable to show the written contracts it had with the workers. White the absence of the contract does not grant permanent status it is the burden of the employer to prove that the employees were aware that their contract with the company is for per project only. While Hanjin submitted a termination report including the worker’s names to prove that the services of their services were only contracted for a per project basis, Hanjin only submitted one report. It was unable to disprove the allegation of the workers that they were part of a pool that Hanjin contacts once a project is to be completed. Employers cannot mislead their employees, whose work is necessary and desirable in the former's line of business, by treating themes though they are part of a work pool from which workers could be continually drawn and then assigned to various projects and thereafter denied regular status at any time by the expedient act of filing a Termination Report. This would constitute a practice in which an employees unjustly precluded from acquiring security of tenure, contrary to public policy, morals, good customs and public order.Hanjin alleged that per Department Order 19, Series of 1993 of DOLE, the payment of completion bonus is further proof that the workers were only project employees as Hanjin is mandated by law to pay it to the temporary workers whose contracts are about to end upon the completion of

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the project. SC views the completion bonus terminology here reflects the fact that the project has already been completed and that is the premium they wished to pay. Quitclaims are viewed with disfavor, especially when –a. There is clear proof that the waiver was wangled from an unsuspecting or gullible person. Where the terms are unconscionable in its face. For quitclaims to be valid, it must constitute a reasonable settlement commensurate to their legal rights. It does not preclude them from seeking benefits they were entitled to such as back wages. The respondents were also not granted the twin requirements of notice and hearing.

University of the Philippines v. Ferrer-Calleja (1992)

FACTS:

The Organization of Non-Academic Working Personnel of UP (ONAPUP) filed a petition for certification election with the BLR.

o It claimed to have a membership of 3,236 members—more than 33% of the 9,617 persons constituting the non-academic personnel of four UP campuses (Diliman, Manila, Los Baños, and Visayas).

o UP did not object to the petition. Another labor union, the All UP Workers’ Union (All UP) filed a motion for intervention.

o It alleged that its membership covers both academic and non-academic personnel, and that it aims to unite all rank-and-file employees in one union.

o It assented to the holding of the certification election provided the appropriate organizational unit was first clearly defined.

o It observed in this connection that the Research, Extension and Professorial Staff (REPS), who are academic non-teaching personnel, should not be deemed part of the organizational unit.

UP’s General Counsel was of the stand that there should be two unions—one for the non-academic/administrative, and one for the academic personnel.

BLR Director Calleja: The appropriate organizational unit should embrace all the regular rank-and-file employees.o No evidence to justify the grouping of non-academic personnel separate from academic personnel.o The Director quoted the pertinent provisions of EO 180 and its IRRs:

Section 9. The appropriate organizational unit shall be the employer unit consisting of rank-and-file employees, unless circumstances otherwise require.

Sec. 1, Rule IV. For purposes of registration, an appropriate organizational unit may refer to:

x x x

d. State universities or colleges, government-owned or controlled corporations with original charters.

o General intent of the EO is not to “fragmentize” the employer unit, as can be gleaned from the definition of the term “accredited employees’ organization,” which refers to:

“x x x a registered organization of the rank-and-file employees as defined in these rules recognized to negotiate for the employees in an organizational unit headed by an officer with sufficient authority to bind the agency, such as x x x state colleges and universities.”

o She thus ordered the holding of a certification among all rank-and-file employees, teaching and non-teaching.

At the pre-election conference, UP sought clarification of the term “rank-and-file.” It claimed that there were some teaching and non-teaching employees whose functions were in fact managerial and policy-determining.

It sought the exclusion of high-level employees, pursuant to Sec. 3 of EO 180:

SEC. 3. High-level employees whose functions are normally considered as policy-making or managerial or whose duties are of a highly confidential nature shall not be eligible to join the organization of rank-and file government employees;

It claims that the following should not be considered rank-and-file:o Those with the rank of Assistant Professor or higher;o Those administrative employees holding positions Grade 18 or higher.

The University claims that these employees perform supervisory functions and are vested with effective recommendatory powers. As to the professors, UP notes that these academic staff are members of the University Council, a policy-making body.

ONAPUP did not oppose UP’s classification. All UP remained firm in its stance to unite all the rank-and-file employees under a single organizational unit.

BLR Director Calleja (Second Order): Declared that the professors are rank-and-file employees.o Sec. 1, Rule I, IRRs of EO 180:

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High Level Employee — is one whose functions are normally considered policy determining, managerial or one whose duties are highly confidential in nature. A managerial function refers to the exercise of powers such as:

1. To effectively recommend such managerial actions;

2. To formulate or execute management policies and decisions; or

3. To hire, transfer, suspend, lay-off, recall, dismiss, assign or discipline employees.

o A careful perusal of the University Code shows that the policy- making powers of the Council are limited to academic matters, namely, prescribing courses of study and rules of discipline, fixing student admission and graduation requirements, recommending to the Board of Regents the conferment of degrees, and disciplinary power over students.

o On the other hand, the policies referred to in the definition of high level employees refers to labor-related policies like hiring, firing, discipline, labor standards and benefits, and terms and conditions of employment.

o MR filed by UP was denied.

ISSUES + RULING:

Are the professors, associate professors and assistant professors high-level employees? NO.

The matter was correctly resolved by respondent Director. The College Academic Personnel Committee, through which the academic personnel purportedly perform their

supervisory functions, is actually tasked to:1. Assist the Dean in setting up the details for the implementation of policies, rules, standards or general

guidelines as formulated by the University Academic Personnel Board;2. Review the recommendations submitted by the DAPCs with regard to recruitment, selection, performance

evaluation, tenure, staff development, and promotion of the faculty and other academic personnel of the College;

3. Establish departmental priorities in the allocation of available funds for promotion;4. Act on cases of disagreement between the Chairman and the members of the DAPC particularly on personnel

matters covered by this Order;5. Act on complaints and/or protests against personnel actions made by the Department Chairman and/or the

DAPC (Department Academic Personnel Committee). On the other hand, the University Academic Personnel Board performs the following functions:

1. Assist the Chancellor in the review of the recommendations of the CAPC'S.2. Act on cases of disagreement between the Dean and the CAPC.3. Formulate policies, rules, and standards with respect to the selection, compensation, and promotion of

members of the academic staff.4. Assist the Chancellor in the review of recommendations on academic promotions and on other matters

affecting faculty status and welfare. It is clear that the high-level employees are those who comprise the UAPB. These would refer to the deans,

assistants for academic affairs, and the chief of personnel. They formulate rules, polices and standards respecting selection, compensation and promotion of members of the academic staff.

The functions of the DAPC and UAPB are merely recommendatory. Ultimately, the power to hire, fire, transfer, suspend, lay-off, recall, dismiss, assign or discipline employees rests

with the Board of Regents. It is also clear that ALL academic personnel cannot be considered high-level employees, because not all of them

are members of the DAPC/UAPB. They must be appointed or elected. Neither can membership in the University Council elevate the professors to the status of high-level employees.

o The actions of such council are always subject to the approval of the Board of Regents.o In addition, the policy-determining functions of the University Council refer to academic matters, i.e. those

governing the relationship between the University and its students, and not the University as an employer and the professors as employees. It is thus evident that no conflict of interest results in the professors being members of the University Council and being classified as rank-and-file employees.

Should the academic employees comprise a bargaining unit separate and distinct from that of the non-academic employees of UP? YES.

Bargaining unit – a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.

Labor laws do not provide criteria for determining the proper collective bargaining unit. Sec. 12 of RA 875 merely required an “appropriate bargaining unit.” This was retained in the Labor Code.

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Thus, the Court turned to American jurisprudence for guidance.o Rothenberg:

1. Will of the employees (Globe doctrine);2. Affinity and unit of employees’ interest, such as substantial similarity of work and duties, or similarity

of compensation and working conditions;3. Prior collective bargaining history; and4. Employment status, such as temporary, seasonal, and probationary employees.

o 10 th Annual Report of the NLRB: 1. History, extent and type of organization of employees;2. History of their collective bargaining;3. History, extent and type of organization of employees in other plants of the same employer, or other

employers in the same industry;4. The skill, wages, work and working conditions of the employees;5. The desires of the employees;6. The eligibility of the employees for membership in the union/s involved; and7. The relationship between the unit/s proposed and the employer’s organization, management and

operation.o BASIC TEST: “A unit, to be appropriate, must affect a grouping of employees who have substantial,

mutual interests in wages, hours, working conditions and other subjects of collective bargaining.” Test applied: “community or mutuality of interests” test. In the case at bar, the employees can easily be categorized into two general classes:

o First—non-academic—janitors, messengers, typists, clerks, receptionists, carpenters, electricians, ground-keepers, chauffeurs, mechanics, plumbers; and

o Second—academic—full professors, associate professors, assistant professors, instructors, research, extension and professorial staff.

It would seem obvious that teachers would find very little in common with the University clerks and other non-academic employees as regards responsibilities and functions, working conditions, compensation rates, social life and interests, skills and intellectual pursuits, cultural activities, etc.

On the contrary, the dichotomy of interests, the dissimilarity in the nature of the work and duties as well as in the compensation and working conditions of the academic and non-academic personnel dictate the separation of these two categories of employees for purposes of collective bargaining.

DISPOSITION: Order affirmed.

PNB VS CA

Rita Tapnio owes PNB an amount of P2,000.00. The amount is secured by her sugar crops about to be harvested including her export quota allocation worth 1,000 piculs. The said export quota was later dealt by Tapnio to a certain Jacobo Tuazon at P2.50 per picul or a total of P2,500. Since the subject of the deal is mortgaged with PNB, the latter has to approve it. The branch manager of PNB recommended that the price should be at P2.80 per picul which was the prevailing minimum amount allowable. Tapnio and Tuazon agreed to the said amount. And so the bank manager recommended the agreement to the vice president of PNB. The vice president in turn recommended it to the board of directors of PNB.However, the Board of Directors wanted to raise the price to P3.00 per picul. This Tuazon does not want hence he backed out from the agreement. This resulted to Tapnio not being able to realize profit and at the same time rendered her unable to pay her P2,000.00 crop loan which would have been covered by her agreement with Tuazon.Eventually, Tapnio was sued by her other creditors and Tapnio filed a third party complaint against PNB where she alleged that her failure to pay her debts was because of PNB’s negligence and unreasonableness.

ISSUE: Whether or not Tapnio is correct.

HELD: Yes. In this type of transaction, time is of the essence considering that Tapnio’s sugar quota for said year needs to be utilized ASAP otherwise her allotment may be assigned to someone else, and if she can’t use it, she won’t be able to export her crops. It is unreasonable for PNB’s board of directors to disallow the agreement between Tapnio and Tuazon because of the mere difference of 0.20 in the agreed price rate. What makes it more unreasonable is the fact that the P2.80 was recommended both by the bank manager and PNB’s VP yet it was disapproved by the board. Further, the P2.80 per picul rate is the minimum allowable rate pursuant to prevailing market trends that time. This unreasonable stand reflects PNB’s lack of the reasonable degree of care and vigilance in attending to the matter. PNB is therefore negligent.A corporation is civilly liable in the same manner as natural persons for torts, because “generally speaking, the rules governing the liability of a principal or master for a tort committed by an agent or servant are the same whether the principal or master be a natural person or a corporation, and whether the servant or agent be a natural or artificial person. All of the authorities agree that a principal or master is liable for every tort which it expressly directs or authorizes, and this is just as true of a corporation as of a natural person, a corporation is liable, therefore, whenever a tortious act is committed by an officer or agent under express direction or authority from the stockholders or members acting as a body, or, generally, from the directors as the governing body.”

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