CASE 1:

SECOND DIVISION

G.R. No. 249459, June 14, 2021

PEOPLE OF THE PHILIPPINES, Petitioner, v. NOEL SABATER Y ULAN,

Respondent.

DECISION

LAZARO-JAVIER, J.:

The Case

Petitioner People of the Philippines, through the Office of the Solicitor General
(OSG), seeks to reverse and set aside the following dispositions of the
Court of Appeals in CA-G.R. SP. No. 158342:

1. Resolution1 dated January 28, 2019 dismissing the petition for

late filing; and

2. Resolution2 dated September 17, 2019 denying reconsideration.

Antecedents

Under Information3 dated December 19, 2016, the Naga City Prosecutor's
Office charged respondent Noel Sabater y Ulan with violation of Section 5,
Republic Act No. (RA) 9165, thus:

That on November 4, 2016, in the City of Naga, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, without
authority of law, did then and there willfully, unlawfully and criminally
sell, dispense and deliver to poseur-buyer PO1 Reimon Joy N. Paa�o
one (1) pc. small heat-sealed transparent sachet with markings RJNP�AN
11/04/16, weighing 0.049 gram, containing white crystalline substance which
when tested, was found positive for the presence of Methamphetamine
Hydrochloride popularly known as "shabu", a dangerous drug, in violation of
the above-cited law.
ACTS CONTRARY TO LAW.
The case was raffled to the Regional Trial Court-Br. 24, Naga City as Criminal
Case No. 2016-0935. On arraignment, respondent pleaded not guilty.
Thereafter, trial ensued.4

Approximately five (5) months after the prosecution had formally offered its
evidence, respondent, on June 28, 2018 filed a motion for plea bargaining,
proposing to plead guilty to a lesser offense, i.e. violation of Section 12, RA
9165 for possession of equipment, instrument, apparatus and other
paraphernalia for dangerous drugs, citing AM. No. 18-03-16-SC
entitled Adoption of the Plea Bargaining Framework in Drugs Cases.5

The prosecution opposed, citing DOJ Circular No. 027 dated June 26, 2018. It
provides that when an accused is charged with selling less than five (5)
grams of shabu in violation of Section 5, RA 9165, as here, he or she may
plead guilty to the lesser offense of illegal possession of dangerous drugs
under Section 11(3) of RA 9165, but not under Section 12 of the same law. 6

The Ruling of the Trial Court

By Order7 dated August 2, 2018, the trial court granted respondent's motion,
nullifying DOJ Circular No. 027 in the process, thus:
WHEREFORE, the Motion is GRANTED. This Court declares that DOJ
Circular 27 is contrary to the Rules of Court, and encroachment on the
Rule-Making Power of the Supreme Court of the Philippines. The
Opposition has no valid factual and legal basis. Plea bargaining is allowed in
these cases.

SO ORDERED.8
Hence, respondent's not guilty plea was vacated and he was re-arraigned.
This time, respondent pleaded guilty to violation of Section 12, RA 9165. 9

As borne in its Judgment10 dated September 12, 2018, the trial court rendered
a verdict of conviction against respondent for violation of Section 12, RA
9165, viz.:

WHEREFORE, judgment is hereby rendered finding the accused NOEL

SABATER y ULAN, GUILTY beyond reasonable doubt of the offense under
Section 12, Article II of R.A. 9165.

Applying the Indeterminate Sentence Law, the accused is hereby sentenced

to suffer imprisonment of six months and one day as minimum to four (4)
years as maximum. He is further ordered to pay a fine of Fifty Thousand
Pesos (Php50,000.00). He is further directed to submit himself to a drug
dependency test. If he admits drug use, or deny it but is found positive after
the drug dependency test, he shall undergo treatment and rehabilitation for
a period of not less than 6 months.

In the service of his sentence, the accused shall be credited with the period
of his preventive detention pursuant to Article 29 of the Revised Penal
Code, as amended.

SO ORDERED.11
The Ruling of the Court of Appeals

Aggrieved, the People elevated the case to the Court of Appeals via certiorari,
docketed as CA-G.R. SP. No. 158342. But by Resolution 12 dated January 28,
2019, the Court of Appeals dismissed the petition for late filing. It found that
prosecution received the trial court's Order dated August 2, 2018 six (6) days
later on August 8, 2018. Thus, it had sixty (60) days therefrom or until October
9, 2018 to file a petition for certiorari. As it was, the OSG filed its recourse on
November 13, 2018 only or thirty five (35) days late. 13

The Court of Appeals denied reconsideration on September 17, 2019. 14

The Present Petition

The People now prays anew that respondent's plea to a lesser offense of
violation of Section 12, RA 9165 be set aside, and the case, remanded to the
trial court for further proceedings.15 It faults the Court of Appeals for ruling
that its petition for certiorari was filed out of time. It brings to fore the fact that
government functions in a bureaucracy and certain procedures had to be
observed before they may elevate a case to a higher court. 16 It is because they
followed procedure that the OSG only received copy of the trial court's Order
dated August 2, 2018 on November 8, 2018, after the lapse of the sixty day
period for filing a petition for certiorari.17 The People, thus, prays that it be
accorded leniency as regards the period for filing its recourse before the Court
of Appeals.

The People likewise argues that the Court of Appeals should have resolved the
case on the merits, rather than focusing on mere technicalities. 18 On the
merits, the People faults the Court of Appeals for effectively sustaining
respondent's plea bargaining proposal despite the apparent lack of consent and
over the vigorous opposition of the prosecutor. It asserts that while the
landmark case of Estipona v. Hon. Lobrigo19 allowed plea bargaining in drug
cases, it did not deviate from the consensual nature and essence of plea
bargaining.20 Thus, when the trial court granted respondent's motion for plea
bargaining despite the prosecution's objection, the trial court effectively
encroached upon the government's prerogative to prosecute crimes. 21
At any rate, the trial court gravely abused its discretion when it allowed
respondent to plead to a lesser offense which is not necessarily included in the
offense originally charged.22

Too, the trial court gravely abused its discretion when it declared DOJ Circular
No. 027 contrary to the Rules of Court and an encroachment into the rule-
making power of the Court. Instead of choosing between DOJ Circular No. 27
and A.M. No. 18-03-16-SC, the trial court should have harmonized these
issuances.23

In his comment,24 respondent notes that the People has repeatedly

acknowledged its belated filing of its petition for certiorari before the Court of
Appeals without offering cogent justification for the lapse. He also notes that
the People did not move for reconsideration of the trial court's Order dated
August 2, 2018, a condition sine qua non for filing a petition for certiorari.

In any event, courts have authority to overrule the prosecution's objections in

plea bargaining, especially so when strict adherence to DOJ Circular No. 027
would defeat the principle behind the Court's ruling in Estipona which
nullified the "no-plea bargaining" provision of RA 9165. A contrary view is
tantamount to a surrender of the court's sole and supreme authority to
command the course of the case.

Besides, there is wisdom in allowing the accused in drugs cases to plea bargain
to the lesser offense of violation of Section 12, RA 9165 from Section 5 of the
same law where the quantity of drugs involved is miniscule: 1) to provide a
platform for rehabilitation of small-time drug offenders; 2) to curb police
operatives' nefarious practice of utilizing buy-bust as a tool for abuse; and 3) to
unclog our courts and focus the government's resources to the real bane of
society.

Finally, Pascua v. People25 already resolved whether an accused charged with

violation of Section 5, RA 9165 may plea bargain to the lesser offense of
violation of Section 12 of the same law.

Threshold Issues

Did the Court of Appeals commit reversible error when it dismissed the People's
petition for certiorari for belated filing?

II

Did the trial court commit grave abuse of discretion when it granted
respondent's proposal to plead guilty to the lesser offense of violation of Section
12, RA 9165 without the consent and over the objection of the prosecutor?

III

Did the trial court commit grave abuse of discretion when it declared DOJ
Circular No. 027 an encroachment of the Court's rule-making power?

Ruling

We grant the petition.

The Court of
Appeals
committed
reversible error
�
when it declared
that the petition
for certiorari was
filed out of time

Section 4, Ru1e 65 of the Rules of Court decrees:chanroblesvirtualawlibrary

Section 4. When and where petition filed. - The petition shall be filed not later
than sixty (60) days from notice of the judgment, order or resolution. In case a
motion for reconsideration or new trial is timely filed, whether such motion is
required or not, the sixty (60) day period shall be counted from notice of the
denial of said motion.

x x x

No extension of time to file the petition shall be granted except for compelling
reason and in no case exceeding fifteen (15) days.
To recall, the sole reason for the dismissal of CA-G.R. SP. No. 158342 was its
supposed belated filing. According to the Court of Appeals, the 60- day period
under Section 4, Rule 65 is reckoned from the prosecution's receipt of the trial
court's Order dated August 2, 2018 granting respondent's motion for plea
bargaining. Thus, the petition was filed thirty five (35) days late on November
13, 2018.

But contrary to the Court of Appeals' ruling as well as the allegations of

respondent and even the OSG, the 60-day reglementary period should have
been counted from the prosecution's receipt of the trial court's Judgment dated
September 12, 2018, rather than the Order dated August 2, 2018. People v.
Majingcar26 elucidates:chanroblesvirtualawlibrary
Under Rule 65 of the Rules of Court, a petition for certiorari must be filed
within sixty (60) days from notice of the judgment, order, or resolution sought
to be assailed. Here, the People claims that it reckoned the sixty (60) day period
from September 18, 2018 when the prosecutor received a copy of the trial
court's judgment of conviction that was rendered on the same day.
Remarkably, neither respondents nor the Court of Appeals disagrees that
indeed, on September 18, 2018, the trial rendered the assailed judgment and it
was on the same day, too, when the prosecutor had notice thereof. It follows,
therefore, that starting from September 18, 2018, the sixty day period expired
on November 17, 2018. So when the People filed its petition for certiorari on
November 16, 2018, it did so well within the reglementary period.

At any rate, the Court of Appeals clearly had its way of counting the sixty days.
Although it did not mention from what date it started counting, logic dictates
that it started counting on September 5, 2018, when respondents were re-
arraigned and allowed to plead "guilty" to the lesser offense of violation of
Section 12, Article II of RA 9165 in Criminal Case Nos. 2016-0774 and 2016-
0775. We arrive at this conclusion because the Court of Appeals referred to
November 4, 2018 as the last day for filing the petition for certiorari. Counting
backward, the Court of Appeals appears to have started counting from
September 5, 2018, the date when respondents got re-arraigned and pleaded
guilty to the lesser offense of violation of Section 12, Article II of RA 9165 in
both Crim. Case Nos. 2016-0774 and 2016-0775.

But this counting is erroneous. For it was still much later, on September
18, 2018, when the prosecutor actually had notice of the trial court's
judgment of conviction that was rendered on the same day. Hence, the
People correctly reckoned the sixty day period from September 18, 2018
or until November 17, 2018. Therefore, we repeat that when the People
subsequently filed its petition for certiorari on November 16, 2018, it was
well within the reglementary period.

To clarify, the Plea Bargaining Resolutions dated August 6, 2018 and

September 1, 2018 are mere interlocutory orders which cannot be the
subject of a petition for certiorari. To allow a challenge thereof via Rule 65
will not only breed undue delay in the administration of justice but a much
frowned upon piecemeal attacks against the court's mere interim issuances.
Consistent with consideration of expediency, the proper remedy is a one time
challenge against the court's final judgment on the merits. To allow otherwise
would result in a never ending trial, not to mention the clogging of the dockets
of appellate court with ad infinitum petitions of aggrieved parties-litigants
against every interlocutory order of the trial court. (emphases added)
Unfortunately, the OSG never alleged when the People received notice of the
Judgment dated September 12, 2018. Assuming that the People received notice
on the same day judgment was promulgated, the OSG had until November 11,
2018 to file a petition for certiorari before the Court of Appeals. But since the
deadline fell on a Sunday, the petition became due on November 12, 2018. As
it was, CA-G.R. SP. No. 158342 was filed on November 13, 2018 or one (1) day
late.

Indeed, the OSG admitted that CA-G.R. SP. No. 158342 was belatedly filed.
Generally, failure to avail of any remedy against an adverse ruling within the
reglementary period would allow it to lapse into finality. Once final, it becomes
immutable and unalterable. It may no longer be modified or amended by any
court in any manner even if the purpose of the modification or amendment is
to correct perceived errors of law or fact. This is the doctrine of immutability of
judgment.27

But the principle of immutability of judgment is not absolute and admits of

four (4) exceptions, viz.:28chanrobleslawlibrary
(1) Correction of clerical errors;

(2) So-called nunc pro tunc entries which cause no prejudice to any party;

(3) Void judgments; and

(4) Whenever circumstances transpire after the finality of the decision

rendering its execution unjust and inequitable. (emphasis added)
As will be discussed below, the third exception is applicable here.

The trial court's

judgment was void
as it granted
respondent's plea-
bargaining �
proposal, sans the
consent and over
the opposition of
the prosecution

Section 2, Rule 116 of the Rules of Court embodies the rule on

plea�bargaining, thus:chanroblesvirtualawlibrary
Sec. 2. Plea of guilty to a lesser offense. - At arraignment, the accused, with
the consent of the offended party and the prosecutor, may be allowed by
the trial court to plead guilty to a lesser offense which is necessarily included
in the offense charged. After arraignment but before trial, the accused may still
be allowed to plead guilty to said lesser offense after withdrawing his plea of
not guilty. No amendment of the complaint or information is necessary.
(emphasis added)
Verily, the consent of the prosecutor is a condition precedent before an accused
may validly plead guilty to a lesser offense. 29 As Associate Justice Rodil V.
Zalameda explained in his Separate Concurring Opinion in Sayre v.
Xenos:30The reason for this is obvious. The prosecutor has full control of the
prosecution of criminal actions. Consequently, it is his duty to always
prosecute the proper offense, not any lesser or graver one, when the evidence in
his hands can only sustain the former.

Where the prosecution withholds its consent, the trial court cannot proceed to
approve a plea bargain. There is no meeting of the minds, hence, there can be
no plea bargaining "agreement" to speak of. Should the trial court nevertheless
approve the plea bargain over the prosecution's objection, it would be doing so
in grave abuse of discretion. Justice Zalameda further
explained:chanroblesvirtualawlibrary
In choosing to respect the prosecution's discretion to give or withhold consent,
the Court is not surrendering any of its powers. Instead, it is an exercise of
sound judicial restraint. Courts cannot forcefully insist upon any of the parties
to plead in accordance with the Plea Bargaining Framework. To
emphasize, when there is no unanimity between the prosecution and the
defense, there is also no plea bargaining agreement to speak of. If a party
refuses to enter a plea in conformity with the Plea Bargaining Framework, a
court commits grave abuse of discretion should it unduly impose its will
on the parties by approving a plea bargain and issuing a conviction based on
the framework.
Grave abuse of discretion is such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction. The abuse must be grave as
where the power is exercised in an arbitrary or despotic manner by reason of
passion or personal hostility. It must also be so patent and gross as to amount
to an evasion of positive duty or to a virtual refusal to perform the duty
enjoined by or to act at all in contemplation of law. 31

Here, the trial court acted with grave abuse of discretion or without jurisdiction
when despite the vehement objection of the prosecution, it peremptorily, in
clear violation of Section 2, Rule 116 of the Rules of Court, approved
respondent's proposal to plead guilty to the lesser offense of violation of Section
12, RA 9165, in lieu of the original charge of violation of Section 5 of the same
law.

Otherwise stated, the trial court acted without or beyond its jurisdiction when
it rendered the assailed Judgment dated September 12, 2018. Mercury Drug
Corporation v. Sps. Huang teaches that such judgment is actually void,
hence, has no legal or binding effect, thus:32chanrobleslawlibrary
Void judgments produce "no legal [or] binding effect." Hence, they are
deemed non-existent. They may result from the "lack of jurisdiction over the
subject matter" or a lack of jurisdiction over the person of either of the
parties. They may also arise if they were rendered with grave abuse of
discretion amounting to lack or excess of jurisdiction. (emphases added)
Consequently, the Judgment dated September 12, 2018 is void, ineffectual,
and could never lapse into finality.

DOJ Circular
No. 27 does
not encroach
�
upon the rule
making power
of the Court

Another. DOJ Circular No. 027 does not infringe upon the Court's rule making
power under the Constitution. This matter has been categorically resolved in
the landmark ruling of Sayre,33 thus:

In this petition, A.M. No. 18-03-16-SC is a rule of procedure established

pursuant to the rule-making power of the Supreme Court that serves as a
framework and guide to the trial courts in plea bargaining violations of R.A.
9165.

Nonetheless, a plea bargain still requires mutual agreement of the parties and
remains subject to the approval of the court. The acceptance of an offer to
plead guilty to a lesser offense is not demandable by the accused as a matter of
right but is a matter addressed entirely to the sound discretion of the trial
court.

Section 2, Rule 116 of the Rules of Court expressly states:

Sec. 2. Plea of guilty to a lesser offense. - At arraignment, the accused, with

the consent of the offended party and the prosecutor, may be allowed by
the trial court to plead guilty to a lesser offense which is necessarily included
in the effense charged. After arraignment but before trial, the accused may still
be allowed to plead guilty to said lesser offense after withdrawing his plea of
not guilty. No amendment of the complaint or information is necessary.

The use of the word "may" signifies that the trial court has discretion whether
to allow the accused to make a plea of guilty to a lesser offense. Moreover, plea
bargaining requires the consent of the accused, offended party, and the
prosecutor. It is also essential that the lesser offense is necessarily included in
the offense charged.

Taking into consideration the requirements in pleading guilty to a lesser

offense, We find it proper to treat the refusal of the prosecution to adopt
the acceptable plea bargain for the charge of Illegal Sale of Dangerous
Drugs provided in A.M. No. 18-03-16-SC as a continuing objection that
should be resolved by the RTC. This harmonizes the constitutional provision
on the rule making power of the Court under the Constitution and the nature
of plea bargaining in Dangerous Drugs cases. DOJ Circular No. 27 did not
repeal, alter, or modify the Plea Bargaining Framework in A.M. No. 18-03-
16-SC.

Therefore, the DOJ Circular No. 27 provision pertaining to acceptable plea

bargain for Section 5 of R.A. 9165 did not violate the rule-making
authority of the Court. DOJ Circular No. 27 merely serves as an internal
guideline for prosecutors to observe before they may give their consent to
proposed plea bargains. (Emphases added)

This ruling by the Court En Banc further compels the invalidation of the
assailed trial court judgment and its concomitant orders.

ACCORDINGLY, the petition is GRANTED. The Resolutions dated January 28,

2019 and September 17, 2019 in CA-G.R. SP. No. 158342
are REVERSED and SET ASIDE.

The Judgment dated September 12, 2018 and the concomitant orders of the
Regional Trial Court-Branch 24, Naga City in Criminal Case No. 2016-0935
are VOID for having been issued in grave abuse of discretion. The trial court
is ORDERED to proceed with the criminal case against respondent Noel
Sabater y Ulan with utmost dispatch.chanroblesvirtualawlibrary

SO ORDERED.

Perlas-Bernabe, Senior Associate Justice, (Chairperson), M. Lopez, Rosario,

and J. Lopez,*JJ., concur.chanrobleslawlibrary
Philippine Supreme Court Jurisprudence

Philippine Supreme Court Jurisprudence > Year 2021 > February 2021
Decisions > G.R. No. 209551 - FELINO A. PALAFOX, JR., Petitioner, v. HON.
FRANCISCO G. MENDIOLA AND SENATOR EDGARDO J. ANGARA,
Respondents.:

G.R. No. 209551 - FELINO A. PALAFOX, JR., Petitioner, v. HON. FRANCISCO

G. MENDIOLA AND SENATOR EDGARDO J. ANGARA, Respondents.

THIRD DIVISION

G.R. No. 209551, February 15, 2021

FELINO A. PALAFOX, JR., Petitioner, v. HON. FRANCISCO G. MENDIOLA
AND SENATOR EDGARDO J. ANGARA,* Respondents.

DECISION

HERNANDO, J.:

This is a Petition for Certiorari1 assailing the July 11, 20132 and September 20,
2013 Orders3 of Regional Trial Court (RTC) of Pasay City, Branch 115.

The July 11, 2013 Order denied petitioner Felino A. Palafox, Jr.'s (Palafox, Jr.)
motion to dismiss for improper venue and granted private respondent Edgardo
J. Angara's (Sen. Angara) motion to take oral deposition. 4 The September 20,
2013 Order denied Palafox, Jr.'s motion for reconsideration. 5

Antecedents:

This case stemmed from the Complaint for Damages 6 filed by Sen. Angara
against Palafox, Jr., wherein Sen. Angara alleged that Palafox, Jr. authored an
unsigned letter containing defamatory statements against him. 7 In the
Complaint, Sen. Angara indicated that he was holding office in Pasay City. 8

In his Answer,9 Palafox, Jr. argued that venue was improperly laid since the
Complaint was filed in the RTC of Pasay City instead of Makati City where both
parties reside.10 He then moved to set the preliminary hearing on his
affirmative defenses,11 raising such issue of improper venue, among
others.12 Sen. Angara opposed this motion13 and pointed out that Article 360 of
the Revised Penal Code14 allows the filing of the civil action where the public
officer holds office. In response, Palafox, Jr. argued that Article 360 is
inapplicable because the action involved is a civil action for damages and not a
criminal action for libel.15

Meanwhile, Sen. Angara served Palafox, Jr. with a notice to take deposition
upon oral examination.16 Palafox, Jr. opposed such notice on the ground that
deposition was premature as pre-trial had not yet been terminated. 17

In its July 11, 2013 Order, the trial court held that the venue was proper since
the filing of a separate civil action for damages where the public officer holds
office is allowed under Article 360.18 Thus, the RTC denied Palafox, Jr.'s motion
to dismiss for improper venue.19 The trial court likewise granted Sen. Angara's
motion to take oral deposition pursuant to Section 1, Rule 23 of the 1997
Rules on Civil Procedure,20 which does not expressly require the termination of
pre-trial before the taking of deposition.

The dispositive portion of the RTC Order reads:chanroblesvirtualawlibrary

WHEREFORE, defendant's motion to dismiss for improper venue is DENIED,
while plaintiff's motion to compel defendant to oral deposition is GRANTED,
and the testimony of defendant by oral examination will be taken before the
Branch Clerk of Court on September 10, 2013 at 11:00 A.M.

SO ORDERED.21
Palafox, Jr. filed a motion for reconsideration but it was denied by the trial
court in its September 20, 2013 Order. 22

Thus, this Petition for Certiorari, where Palafox, Jr. raises the following
issues:chanroblesvirtualawlibrary
I. Whether or not the lower court committed grave abuse of discretion
amounting to lack or excess of jurisdiction when it ruled that the venue as
provided under Article 360 of the Revised Penal Code is applicable in a civil
case for Moral and Exemplary Damages arising from alleged defamatory
statements where no criminal case is commenced or filed.

II. Whether or not the lower court committed grave abuse of discretion
amounting to lack or excess of jurisdiction in granting [Sen. Angara's] Motion
to Compel Palafox to submit to Deposition upon Oral Examination. 23
Palafox, Jr. argues that for Article 360 to apply, there must be a criminal case
filed, as gleaned from the usage of the conjunctive word "and" in the provision.
Since no criminal case was commenced, Palafox, Jr. posits that Sen. Angara
cannot rely on Article 360 but on the Rules of Court which requires the filing of
the case where the plaintiff or defendant resides. 24 Further, Palafox, Jr. argues
that the conduct of the oral deposition was premature since the trial court had
yet to terminate pre-trial.25 Accordingly, he prays for (1) a temporary
restraining order (TRO) against the taking of his deposition; (2) the reversal of
the RTC's July 11, 2013 and September 20, 2013 Orders, and (3) the dismissal
of Sen. Angara's Complaint for Damages. 26

In his Comment,27 Sen. Angara raised the following counter arguments: (1) that
there is no need for a criminal case to be filed since Article 360 is clear that a
criminal and civil action for damages can be filed simultaneously or
separately;28 (2) that there is no requirement that a pre-trial should be
conducted first before deposition may be taken;29 (3) that the prayer for TRO
against the taking of deposition had become moot and academic in view of the
happening of such event;30 and (4) that Palafox, Jr. violated the rule on
hierarchy of courts when he filed the Petition directly to the Supreme Court. 31

While Palafox, Jr. was required to file a Reply to Sen. Angara's Comment, 32 he
manifested that he was adopting his arguments raised in the Petition. 33

Our Ruling
We dismiss the Petition for violation of the rule on hierarchy of courts.

In Dy v. Bibat-Palamos,34 We summarized such rule and the exceptions

thereto:chanroblesvirtualawlibrary
Under the principle of hierarchy of courts, direct recourse to this Court is
improper because the Supreme Court is a court of last resort and must remain
to be so in order for it to satisfactorily perform its constitutional functions,
thereby allowing it to devote its time and attention to matters within its
exclusive jurisdiction and preventing the overcrowding of its docket.
Nonetheless, the invocation of this Court's original jurisdiction to issue writs
of certiorari has been allowed in certain instances on the ground of special and
important reasons clearly stated in the petition, such as, (I) when dictated by
the public welfare and the advancement of public policy; (2) when demanded by
the broader interest of justice; (3) when the challenged orders were patent
nullities; or (4) when analogous exceptional and compelling circumstances
called for and justified the immediate and direct handling of the
case.35 (Citations omitted)
We have repeatedly emphasized the importance of strictly respecting this rule.
In Pemberton v. De Lima,36 We said that the Court may only act when
absolutely necessary or when serious and important reasons exist to justify an
exception:chanroblesvirtualawlibrary
The Court must enjoin the observance of the policy on the hierarchy of courts,
and now affirms that the policy is not to be ignored without serious
consequences. The strictness of the policy is designed to shield the Court from
having to deal with causes that are also well within the competence of the
lower courts, and thus leave time to the Court to deal with the more
fundamental and more essential tasks that the Constitution has assigned to it.
The Court may act on petitions for the extraordinary writs of certiorari,
prohibition and mandamus only when absolutely necessary or when serious
and important reasons exist to justify an exception to the policy. 37
Further, We have held that such serious and important reasons must be
"clearly stated in the petition."38

Here, Palafox, Jr. filed his Petition directly to this Court despite the concurrent
jurisdiction of the appellate court. Significantly, he did not bother to
provide any reason or explanation to justify his noncompliance to the rule
on hierarchy of courts. Further, when he was required to reply to Sen.
Angara's Comment containing the latter's argument on the violation of
hierarchy of courts, he simply manifested his adoption of his previous
arguments in the Petition. This constitutes a clear disregard of the hierarchy of
courts and merits the dismissal of the Petition.

WHEREFORE, this Court resolves to DISMISS the

Petition.chanroblesvirtualawlibrary
SO ORDERED.

Leonen, (Chairperson), Inting, Delos Santos, and J. Lopez, JJ.,

concur.chanrobleslawlibrary

Philippine Supreme Court Jurisprudence

Philippine Supreme Court Jurisprudence > Year 2020 > June 2020 Decisions >
G.R. No. 251954 - IN RE: IN THE MATTER OF THE ISSUANCE OF A WRIT OF
HABEAS CORPUS OF INMATES RAYMUNDO REYES AND VINCENT B.
EVANGELISTA, DULY REPRESENTED BY ATTY. RUBEE RUTH C. CAGASCA-
EVANGELISTA, IN HER CAPACITY AS WIFE OF VINCENT B. EVANGELISTA
AND COUNSEL OF BOTH INMATES, PETITIONER, v. BUCOR CHIEF GERALD
BANTAG, IN HIS CAPACITY AS DIRECTOR GENERAL OF BUREAU OF
CORRECTIONS OF NEW BILIBID PRISON, BUREAU OF CORRECTIONS AND
ALL THOSE PERSONS IN CUSTODY OF THE INMATES RAYMUNDO REYES
AND VINCENT B. EVANGELISTA, RESPONDENT.:

G.R. No. 251954 - IN RE: IN THE MATTER OF THE ISSUANCE OF A WRIT OF

HABEAS CORPUS OF INMATES RAYMUNDO REYES AND VINCENT B.
EVANGELISTA, DULY REPRESENTED BY ATTY. RUBEE RUTH C. CAGASCA-
EVANGELISTA, IN HER CAPACITY AS WIFE OF VINCENT B. EVANGELISTA
AND COUNSEL OF BOTH INMATES, PETITIONER, v. BUCOR CHIEF GERALD
BANTAG, IN HIS CAPACITY AS DIRECTOR GENERAL OF BUREAU OF
CORRECTIONS OF NEW BILIBID PRISON, BUREAU OF CORRECTIONS AND
ALL THOSE PERSONS IN CUSTODY OF THE INMATES RAYMUNDO REYES
AND VINCENT B. EVANGELISTA, RESPONDENT.

THIRD DIVISION

G.R. No. 251954, June 10, 2020

IN RE: IN THE MATTER OF THE ISSUANCE OF A WRIT OF HABEAS

CORPUS OF INMATES RAYMUNDO REYES AND VINCENT B.
EVANGELISTA, DULY REPRESENTED BY ATTY. RUBEE RUTH C.
CAGASCA-EVANGELISTA, IN HER CAPACITY AS WIFE OF VINCENT B.
EVANGELISTA AND COUNSEL OF BOTH INMATES, PETITIONER, v. BUCOR
CHIEF GERALD BANTAG, IN HIS CAPACITY AS DIRECTOR GENERAL OF
BUREAU OF CORRECTIONS OF NEW BILIBID PRISON, BUREAU OF
CORRECTIONS AND ALL THOSE PERSONS IN CUSTODY OF THE INMATES
RAYMUNDO REYES AND VINCENT B. EVANGELISTA, RESPONDENT.

RESOLUTION
ZALAMEDA, J.:

Before the Court is a Petition for the Issuance of Writ of Habeas Corpus praying
for: 1) the issuance of a writ of habeas corpus directing respondent Gerald
Bantag, as Director General of the Bureau of Corrections, to make a return
thereon, showing legal authority to detain Raymundo Reyes (Reyes) and
Vincent B. Evangelista (Evangelista), persons deprived of liberty (PDLs), and to
present them personally before the Court; and 2) for the release of Reyes and
Evangelista from incarceration at the New Bilibid Prison in Muntinlupa City.

Petitioner, Atty. Rubee Ruth C. Cagasca-Evangelista (petitioner), the wife of

Evangelista, filed the instant petition as counsel for her husband and Reyes.
She alleges that Reyes and Evangelista were convicted 1 by Branch 103,
Regional Trial Court (RTC) of Quezon City on 14 December 2001 for violation of
Section 15, Article III, Republic Act No. (RA) 6425, 2 as amended, for the illegal
sale of 974.12 grams of methylamphetamine hydrochloride, or shabu, acting in
conspiracy with one another, and were sentenced to suffer the penalty
of reclusion perpetua and to pay the amount of Php 500,000.00 each. The
penalty was made in accordance with the amendment introduced by RA
7659,3 which increased the penalty of imprisonment for illegal sale of drugs
from six (6) years and one (1) day to twelve (12) years, to reclusion pe1petua to
death for 200 grams or more of shabu. The said conviction was affirmed by the
Supreme Court in a Decision4 dated 27 September 2007.

More than a decade after the affirmation of Reyes and Evangelista's conviction
by the Supreme Court, petitioner now claims that with the abolition of the
death penalty,5 and the repeal of the death penalty in RA 7659 as a
consequence, the penalty for illegal sale of drugs should be reverted to that
originally imposed in RA 6425, or from reclusion perpetua in RA 7659 to six (6)
years and one (1) day to twelve (12) years in RA 6425. According to her, "if the
convicts will serve the penalty of RECLUSION PERPETUA[,] it is as (sic) the
same as punishing them to (sic) a crime that is not existing anymore. And said
[penalty] will [be] tantamount to deprivation of their life and liberty and will not
be fair and just in the eyes of man and law." 6

Further, petitioner insists that both Reyes and Evangelista have already served
19 years and 2 months, or more than 18 years if the benefit of Good Conduct
Time Allowance (GCTA) under RA 105927 was to be considered. And, with the
benefit of the GCTA, which may be applied retroactively, 8 both Reyes and
Evangelista have already served more than the required sentence imposed by
law.

The primary consideration is the propriety of the petition for the issuance of
the writ of habeas corpus.
We answer in the negative.

As a preliminary matter, we point out that petitioner disregarded the basic

rules of procedure. There is no verified declaration of electronic submission of
the soft copy of the petition. The required written explanation of service or filing
under Section 11, Rule 13 of the Rules of Court is also patently lacking.

Second, petitioner disregarded the hierarchy of courts.

The Rules of Court provide that "[e]xcept as otherwise expressly provided by

law, the writ of habeas corpus shall extend to all cases of illegal confinement or
detention by which any person is deprived of his liberty, or by which the
rightful custody of any person is withheld from the person entitled thereto." 9

An application for a writ of habeas corpus may be made through a petition filed
before this Court or any of its members, the Court of Appeals (CA) or any of its
members in instances authorized by law, or the RTC or any of its presiding
judges.10 In the absence of all the RTC judges in a province or city, any
metropolitan trial judge, municipal trial judge, or municipal circuit trial judge
may hear and decide petitions for a writ of habeas corpus in the province or
city where the absent RTC judges sit.11

Hence, this Court has concurrent jurisdiction, along with the CA and the trial
courts, to issue a writ of habeas corpus. However, mere concurrency of
jurisdiction does not afford parties absolute freedom to choose the court with
which the petition shall be filed.12 Petitioners should be directed by the
hierarchy of courts. After all, the hierarchy of courts "serves as a general
determinant of the appropriate forum for petitions for the extraordinary
writs."13

In the landmark case of Gios-Samar, Inc., v. DOTC,14 the Supreme Court ruled
that direct recourse to this Court is proper only to seek resolution of questions
of law, and not issues that depend on the determination of questions of facts:

In fine, while this Court has original and concurrent jurisdiction with the RTC
and the CA in the issuance of writs of certiorari, prohibition, mandamus, quo
warranto, and habeas corpus (extraordinary writs), direct recourse to this
Court is proper only to seek resolution of questions of law. Save for the single
specific instance provided by the Constitution under Section 18, Article
VII, cases the resolution of which depends on the determination of
questions of fact cannot be brought directly before the Court because we
arc not a trier of facts. We are not equipped, either by structure or rule, to
receive and evaluate evidence in the first instance; these are the primary
functions of the lower courts or regulatory agencies. This is the raison
d'etre behind the doctrine of hierarchy of courts. It operates as a constitutional
filtering mechanism designed to enable this Court to focus on the more
fundamental tasks assigned to it by the Constitution. It is a bright-line rule
which cannot be brushed aside by an invocation of the transcendental
importance or constitutional dimension of the issue or cause raised. (Emphasis
supplied)
At first blush, petitioner seeks to raise a question of law - whether or not the
abolition of the death penalty in RA 9346 reverted the penalty for illegal sale
of shabu from RA 7659 to RA 6425 prior to its amendment, thus placing the
question within the jurisdiction of this Court. The real question, however, is the
release of Reyes and Evangelista from detention based on the alleged service of
their sentences pursuant to RA 10592, which requires a determination of
facts, i.e., if said PDLs are entitled to the benefit of GCTA. On this ground
alone, the petition must be dismissed.

At any rate, it must be stressed that as a matter of policy, direct resort to this
Court will not be entertained unless the redress desired cannot be obtained in
the appropriate lower courts, and exceptional and compelling circumstances,
such as in cases involving national interest and those of serious implications,
justify the availment of the extraordinary remedy of the writ of certiorari, calling
for the exercise of its primary jurisdiction. 15 Not one of these exceptional and
compelling circumstances, however, were even alleged or shown in order for the
Court to disregard the sanctity of the hierarchy of courts.

Procedural considerations aside, the Court still finds the petition wanting in
merit.

A prime specification of an application for a writ of habeas corpus is restraint of

liberty. The essential object and purpose of the writ of habeas corpus is to
inquire into all manner of involuntary restraint as distinguished from
voluntary, and to relieve a person therefrom if such restraint is illegal. Any
restraint that will preclude freedom of action is sufficient. 16 The rule is that if a
person alleged to be restrained of his liberty is in the custody of an officer
under process issued by a court or judge, or by virtue of a judgment or order of
a court of record, the writ of habeas corpus will not be allowed.17 Section 4,
Rule 102 of the Revised Rules of Court provides:
Section 4. When writ not allowed or discharge authorized. - If it appears that
the person alleged to be restrained of his liberty is in the custody of an officer
under process issued by a court or judge or by virtue of judgment or order of a
court of record, and that the court or judge had jurisdiction to issue the
process, render the judgment, or make the order, the writ shall not be allowed;
or if the jurisdiction appears after the writ is allowed, the person shall not be
discharged by reason of any informality or defect in the process, judgment, or
order. Nor shall anything in this rule be held to authorize the discharge of a
person charged with or convicted of an offense in the Philippines, or of a person
suffering imprisonment under lawful judgment.
In this case, the confinement of Reyes and Evangelista at the New Bilibid
Prison in Muntinlupa City is valid pursuant to a lawful judgment. They were
convicted for violation of Section 15, RA 6425, as amended by RA 7659, and
the affirmation of their conviction was decreed by no less than this very Court.
We are aware that the writ of habeas corpus may also be availed of as a post-
conviction remedy when, as a consequence of a judicial proceeding, any of the
following exceptional circumstances is attendant: 1) there has been a
deprivation of a constitutional right resulting in the restraint of a person; 2) the
court had no jurisdiction to impose the sentence; or 3) the imposed penalty
has been excessive, thus voiding the sentence as to such excess.18 Here,
petitioner invokes the third circumstance.

When the detention complained of finds its origin in what has been judicially
ordained, the range of inquiry in a habeas corpus proceeding is considerably
narrowed.19 As a high prerogative writ which furnishes an extraordinary
remedy, the writ of habeas corpus may be invoked only under extraordinary
circumstances.20 Mere invocation that an extraordinary circumstance exists is
not enough, as in this case.

As claimed by petitioner, there is no dispute that death penalty has been

abolished. This does not mean, however, that the penalties imposed under RA
7956, apart from death, have likewise been repealed. Section 1 of RA 9346, An
Act Prohibiting the Death Penalty in the Philippines, provides:
SECTION 1. The imposition of the penalty of death is hereby prohibited.
Accordingly, Republic Act No. Eight Thousand One Hundred Seventy-Seven
(R.A. No. 8177), otherwise known as the Act Designating Death by Lethal
Injection is hereby repealed, Republic Act No. Seven Thousand Six Hundred
Fifty-Nine (R.A. No. 7659), otherwise known as the Death Penalty Law,
and all other laws, executive orders and decrees, insofar as they impose
the death penalty are hereby repealed or amended accordingly.
Upon a reading of the law, only the imposition of the death penalty has been
removed, and RA 7659, as well as other laws, are repealed or amended insofar
as they impose the death penalty. Section 2 of RA 9346 provides the
appropriate penalty in lieu of death: reclusion perpetua, when the law violated
makes use of the nomenclature of the Revised Penal Code; or life
imprisonment, when the law violated does not make use of the said
nomenclature. Evidently, RA 9346 did not repeal the amendment introduced in
RA 7659 imposing the penalty of reclusion perpetua in cases of illegal sale of
dangerous drugs. As such, the imposition of the penalty of imprisonment
of reclusion perpetua against Reyes and Evangelista is valid.

On the issue of the applicability of RA 10592, Section 2, Rule IV of the 2019

Revised Implementing Rules and Regulations of Republic Act No. 10592, "An
Act Amending Articles 29, 94, 97, 98, and 99 of Act No. 3815, as amended,
otherwise known as the Revised Penal Code," (2019 IRR), issued by the
Department of Justice (DOJ) and the Department of the Interior and Local
Government (DILG), provides:
Section 2. GCTA During Service of Sentence. - The good conduct of a PDL
convicted by final judgment in any penal institution, rehabilitation or detention
center or any other local jail shall entitle him to the deductions described in
Section 3 hereunder, as GCTA, from the period of his sentence, pursuant to
Section 3 of RA No. 10592.

The following shall not be entitled to any GCTA during service of

sentence:
a. Recidivists;
b. Habitual Delinquents;
c. Escapees; and
d. PDL convicted of Heinous Crimes.
It is clear from the aforequoted provision that PDLs convicted of heinous crimes
shall not be entitled to GCTA. Section 1 of RA 10592, amending Article 29 of
the RPC, supports this:
x x x Provided, finally, that recidivists, habitual delinquents, escapees and
persons charged with heinous crimes are excluded from the coverage of
this Act. (Emphasis supplied)
Reyes and Evangelista, who were found guilty of illegal sale of dangerous drugs
exceeding 200 grams, have committed a heinous crime. This is in consonance
with RA 7659, which includes the distribution or sale of dangerous drugs as
heinous for being a grievous, odious and hateful offense and which, by reason
of its inherent or manifest wickedness, viciousness, atrocity and perversity is
repugnant and outrageous to the common standards and norms of decency
and morality in a just, civilized and ordered society. 21

Rules and regulations issued by administrative bodies to interpret the law

which they are entrusted to enforce, such as the 2019 IRR issued by the DOJ
and the DILG, have the force of law, and are entitled to great respect.
Administrative issuances partake of the nature of a statute and have in their
favor a presumption of legality. As such, courts cannot ignore administrative
issuances especially when, as in this case, its validity was not put in issue.
Unless an administrative order is declared invalid, courts have no option but to
apply the same.22

Accordingly, the writ cannot be issued and the discharge of Reyes and
Evangelista from imprisonment should not be authorized.

WHEREFORE, the petition is hereby DISMISSED.

SO ORDERED.

Leonen, (Chairperson), Gesmundo, Carandang, and Gaerlan,*JJ., concur.

chanroblesvirtuallawlibrary

July 30, 2020

NOTICE OF JUDGMENT

Philippine Supreme Court Jurisprudence

Philippine Supreme Court Jurisprudence > Year 2019 > October 2019
Decisions > G.R. No. 234255 - GENOVEVA G. GABRILLO, REP. HEREIN BY
ATTORNEY-IN-FACT, MEDARDO G. CADIENTE, JR., PETITIONER, v. HEIRS
OF OLIMPIO PASTOR REP. BY CRESENCIANA MANGUIRAN VDA. DE PASTOR,
RESPONDENT.:
G.R. No. 234255 - GENOVEVA G. GABRILLO, REP. HEREIN BY ATTORNEY-IN-
FACT, MEDARDO G. CADIENTE, JR., PETITIONER, v. HEIRS OF OLIMPIO
PASTOR REP. BY CRESENCIANA MANGUIRAN VDA. DE PASTOR,
RESPONDENT.

SECOND DIVISION

G.R. No. 234255, October 02, 2019

GENOVEVA G. GABRILLO, REP. HEREIN BY ATTORNEY-IN-FACT,

MEDARDO G. CADIENTE, JR., PETITIONER, v. HEIRS OF OLIMPIO
PASTOR REP. BY CRESENCIANA MANGUIRAN VDA. DE PASTOR,
RESPONDENT.

DECISION

J. REYES, JR., J.:

This is a Petition for Review on Certiorari1 under Rule 45 which seeks to annul
and set aside the Decision2 dated October 27, 2016 of the Court of Appeals-
Cagayan De Oro City (CA-CDO) and its Resolution 3 dated May 25, 2017 in CA-
G.R. CV No. 03419-MIN which affirmed the Decision 4 dated July 18, 2013 of
the Regional Trial Court (RTC), Branch 16, Davao City in Civil Case No.
33,213-10 for Declaration of Trust and/or Declaration of Nullity of Title,
Reconveyance, Damages, Attorney's Fees and Injunction, with Writ of
Preliminary Injunction and Temporary Restraining Order filed by Genoveva G.
Gabrillo (petitioner) represented by her then Attorney-in-Fact Teresita Baguio
against the heirs of Olimpio Pastor (respondents) represented by Cresenciana
vda. de Pastor.5

The Antecedents

Petitioner claimed that she is the lawful and rightful owner of a parcel of land
(subject property) consisting of 9,000 square meters located at Catalunan
Peque�o, Taloma District, Davao City, with a market value of P50,000.00,
originally owned by Olimpio Pastor and Cresenciana Pastor (spouses Pastor). 6
On August 6, 1967, spouses Pastor executed a Transfer of Rights and Sale of
Improvements over the subject property, then consisted of 10,000 square
meters, before the Bureau of Lands Investigation/Inspector in favor of Ernesto
A. Cadiente, Sr. (Cadiente). A conflict between spouses Pastor and Cadiente
arose and a compromise agreement and/or amicable settlement was forged. In
said agreement, Cadiente's land was reduced to 9,000 square meters to devote
the 1,000 square meters to a barangay site. Cadiente moved to set aside the
amicable settlement but the same was denied by the District Land Officer in a
letter dated February 11, 1982.7

On March 13, 1991, Cadiente executed a Transfer of Rights or Relinquishment

and Sale of Improvements conveying the entire 10,000 square-meter property
to petitioner. However, notwithstanding the transfer, respondents filed an
application for free patent on December 29, 1997; thus, Original Certificate of
Title (OCT) No. P-14876 was issued in their favor. Petitioner maintained that
when the respondents registered the subject property in their names, an
implied trust was created warranting reconveyance as well as the
cancellation/annulment of the OCT.

Respondents, for their part, alleged that the property subject of their free
patent application (Lot 848-C, Csd 11-007933) is different from the property
claimed by petitioner (Lot 848-D, Csd-11007933-D). They further posited that
OCT No. P-14876 had become indefeasible one (1) year from the date of its
issuance on December 29, 1997 and can no longer be attacked on the ground
of fraud.8

On July 18, 2013, the RTC dismissed the case. It declared that it has no
jurisdiction to take cognizance of the case because the complaint failed to state
the assessed value of the land in dispute. It further ruled that even if the court
had jurisdiction, the case will still not prosper because the cause of action for
declaration of trust and/or declaration of nullity of title had already
prescribed.9

On appeal, the CA-CDO affirmed the July 18, 2013 Decision holding that the
RTC correctly dismissed petitioner's complaint for failure to allege the assessed
value of the subject property and establish that it has jurisdiction over the
case.

Petitioner moved for the reconsideration of the October 27, 2016 CA Decision
but the same was denied in a Resolution dated May 25, 2017.

Hence, this petition.

The Issue
At the heart of the controversy is the issue of whether the RTC acquired
jurisdiction over petitioner's action by the mere allegation of the market value
or estimated value of the subject property in the complaint.

Petitioner argues that the payment of the docket fees based on the market
value of the property as stated in the complaint conferred the court a
quo jurisdiction to try the present case. Citing the case of Barangay Piapi v.
Talip,10 she asserts that the market value or estimated value of the property
can be considered to determine which court has jurisdiction over a real action.
Moreover, she contends that respondents are already estopped from assailing
the court a quo's jurisdiction when they actively participated in the proceedings
and even formally offered evidence before the court. Finally, she claims that the
court a quo erred in ruling that her cause of action is already barred by
prescription since an action for reconveyance based on implied or constructive
trust is imprescriptible when the plaintiff is in possession of the subject
property as in this case.11

Respondents, on the other hand, state that because of petitioner's failure to

allege the assessed value of the subject property in the complaint, it could not
be reasonably determined whether the RTC has jurisdiction over the case. They
further asseverate that the mere filing and payment of the docket fee do not
confer jurisdiction to the court since jurisdiction is conferred by law under
Batas Pambansa Bilang (B.P. Blg.) 129. They reject petitioner's application of
the principle of estoppel and note that lack of jurisdiction over the subject
matter may be raised at any stage of the proceedings, even for the first time on
appeal. Finally, they emphasize that there can be no constructive trust in the
case at bench because no evidence was ever presented to support such theory.

Our Ruling

The petition is bereft of merit.

Nothing is more settled in procedural law than the rule that jurisdiction over
the subject matter is conferred by law and determined by the allegations in the
complaint, including the character of the reliefs prayed for. 12

Petitioner seeks the transfer of the subject property in her favor as its rightful
and legal owner via an action for reconveyance and annulment of title.
Traversing the complaint, the primary objective of petitioner is to secure her
claimed ownership by recovering the subject property from respondents and
have the certificate of title under their name cancelled. An action for
reconveyance and annulment of title is an action involving title to real
property,13 jurisdiction over which rests on the assessed value of the real
property in question as alleged in the initiatory pleading.
Section 19(2) of B.P. Blg. 129 (The Judiciary Reorganization Act of 1980), as
amended by Republic Act (R.A.) No. 7691,14 pertinently provides:

SEC. 19. Jurisdiction in civil cases. � The Regional Trial Courts shall exercise
exclusive original jurisdiction:

xxxx

(2) In all civil actions which involve the title to, or possession of, real property,
or any interest therein, where the assessed value of the property
involved exceeds Twenty [T]housand [P]esos ([P]20,000.00) or for civil
actions in Metro Manila, where such value exceeds Fifty thousand pesos
([P]50,000.00) except actions for forcible entry into and unlawful detainer of
lands or buildings, original jurisdiction over which is conferred upon the
Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial
Courts[.] (Emphases supplied)

Likewise, Section 33 (3) of the same law reads:

SEC. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in Civil Cases. � Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit Trial Courts shall exercise:

xxxx

(3) Exclusive original jurisdiction in all civil actions which involve title to, or
possession of, real property, or any interest therein where the assessed
value of the property or interest therein does not exceed Twenty [T]housand
[P]esos ([P]20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty [T]housand [P]esos
([P]50,000.00) exclusive of interest, damages of whatever kind, attorney's fees,
litigation expenses and costs: Provided, That in cases of land not declared for
taxation purposes, the value of such property shall be determined by the
assessed value of the adjacent lots.

Clearly, both the first level and the second level court exercise original
jurisdiction over actions involving title to or possession of real property or any
interest therein but it is the assessed value of the realty involved which
ordains which court shall acquire exclusive jurisdiction over a real action as in
this case.

Assessed value is the valuation ascribed on the property as fixed by the taxing
authorities for the purpose of determining the applicable tax rate. 15 It
represents a fraction of the realty's fair market value that qualifies for taxation,
calculated by multiplying the market value by the assessment level. Fair
market value, on the other hand, is the price at which a property may be sold
by a seller, who is not compelled to sell, and bought by a buyer, who is not
compelled to buy.16 Assessed value pertains to the taxable value of the real
property while the fair market value is tantamount to the estimated value of
the real property as agreed on between a willing buyer and a willing seller
under reasonable and ordinary conditions.

Batas Pambansa Bilang 129 is explicit that the jurisdiction of the court over an
action involving title to, or possession of a real property is determined by its
assessed value and not the market value thereof.17 It contemplates a more
conservative and stable method of valuation that is based on a standard
mechanism (multiplying the fair market value by the assessment level)
conducted by the local assessors. This assessed value must be averred in the
complaint; otherwise, it cannot be ascertained which trial court shall exercise
exclusive jurisdiction over the action.

In the case at bench, petitioner's complaint did not allege the disputed
property's assessed value, but instead stated its market value pegged at
P50,000.00. Settled is the rule that the courts cannot take judicial notice of the
assessed value or even the market value of the land.18 The assessed value of
the realty in question must be clearly set forth in the complaint to prompt the
court whether it can or cannot take cognizance of the case. Thus, for
petitioner's failure to allege the assessed value in the complaint, the RTC
cannot be said to have gravely erred in dismissing the complaint on the ground
of lack of jurisdiction.

The Court is not unmindful of the liberal application of the above rule.
In Foronda-Crystal v. Son,19 it was held that the failure to allege the real
property's assessed value in the complaint would not be fatal if, in the
documents annexed to the complaint, an allegation of the assessed value could
be found. It justified the relaxation of the rule by echoing the Court's
pronouncement in Tumpag v. Tumpag,20viz.:

Generally, the court should only look into the facts alleged in the complaint to
determine whether a suit is within its jurisdiction. There may be instances,
however, when a rigid application of this rule may result in defeating
substantial justice or in prejudice to a party's substantial right. x x x

Here, not even a single document reflecting the assessed value of the subject
property was annexed to petitioner's complaint. The attachment of the sworn
declaration of real property to the complaint would have triggered the liberal
application of the rule since it bears the assessed value of the property at
issue. Jurisprudence teaches that "the tax declaration indicating the assessed
value of the property enjoys the presumption of regularity as it has been issued
by the proper government agency."21 Petitioner, however, failed to adduce the
tax declaration which could have shown that the RTC indeed had jurisdiction
over the case.

The market value of the subject property alleged in the complaint cannot be the
basis to determine whether the court a quo has jurisdiction over the case since
it is the assessed value which determines the jurisdiction of the court. If the
lawmakers intended to recognize the market value of the realty as basis in
determining the jurisdiction, they could have specified the same in R.A. No.
7691 which amended B.P. Blg. 129. There being no modification of Section
19(2) and Section 33(3), the rule stands that the jurisdictional element for real
action is the assessed value of the property in question.22

In light of the foregoing, the RTC correctly dismissed the case for lack of
jurisdiction and the CA-CDO correctly affirmed its dismissal. Consequently, the
Court need not discuss the remaining issues raised by petitioner which relate
to the merits of the case.

WHEREFORE, the petition is DENIED. The October 27, 2016 Decision and the
May 25, 2017 Resolution of the Court of Appeals-Cagayan De Oro City in CA-
G.R. CV No. 03419-MIN are AFFIRMED.

SO ORDERED.

Carpio (Chairperson), Caguioa, Lazaro-Javier, and Zalameda, JJ., concur.

Philippine Supreme Court Jurisprudence

Philippine Supreme Court Jurisprudence > Year 2019 > March 2019
Decisions > G.R. No. 204753 - UNITED COCONUT PLANTERS BANK,
PETITIONER, v. SPS. ALISON ANG-SY AND GUILLERMO SY, RENATO ANG,
NENA ANG, RICKY ANG, AND DERICK CHESTER SY, RESPONDENTS.:

G.R. No. 204753 - UNITED COCONUT PLANTERS BANK, PETITIONER, v. SPS.

ALISON ANG-SY AND GUILLERMO SY, RENATO ANG, NENA ANG, RICKY ANG,
AND DERICK CHESTER SY, RESPONDENTS.
SECOND DIVISION

G.R. No. 204753, March 27, 2019

UNITED COCONUT PLANTERS BANK, PETITIONER, v. SPS. ALISON ANG-

SY AND GUILLERMO SY, RENATO ANG, NENA ANG, RICKY ANG, AND
DERICK CHESTER SY, RESPONDENTS.

RESOLUTION

CAGUIOA, J.:

Before this Court is a Petition for Review on Certiorari1 (Petition) under Rule 45
of the Rules of Court filed by petitioner United Coconut Planters Bank
(petitioner UCPB) assailing the Decision 2 dated February 10, 2012 (assailed
Decision) and Resolution3 dated December 7, 2012 (assailed Resolution) of the
Court of Appeals (CA) Special Twelfth Division, and Former Special Twelfth
Division, respectively, in CA-G.R. SP No. 102725, which reversed and set aside
the Order4 dated June 8, 2007 (Order) of the Regional Trial Court of Makati
City, Branch 146 (RTC) for improper service of summons.

The Facts and Antecedent Proceedings

As narrated by the CA in its assailed Decision, the essential facts and

antecedent proceedings of the instant case are as follows:

On 27 November 2006, United Coconut Planters Bank (UCPB) filed a

[C]omplaint5 for sum of money and/or damages with prayer for the ex
parte issuance of a writ of preliminary attachment against Nation Granary, Inc.
(NGI), the spouses Alison Ang-Sy and Guillermo Sy, Renato Ang, Nena Ang,
Ricky Ang, Derick Chester A. Sy [(collectively, respondents Sps. Sy, et al.)], and
Nation Petroleum Gas, Inc. (NPGI) [collectively, therein defendants], [The
Complaint was filed before the RTC and was docketed as Civil Case No. 06-
1014.] The [C]omplaint alleged that, on 28 August 2005, UCPB granted NGI a
credit accommodation, in the form of an Import Letter of Credit/Trust Receipt
Line in the amount of US$15,000,000.00 and a case-to-case Letter of
Credit/Trust Receipt in the amount of US$3,800,400.00. Both NPGI and the
spouses Sy executed Surety Agreements securing the credit accommodations. x
x x Demands for payment remained unheeded. The [C]omplaint prayed that the
RTC order [therein] defendants to pay UCPB: (1) the amount of
P824,390,158.21 plus interest, penalty and other charges from 15 November
2006 until fully paid; (2) P1,000,000.00 as attorney's fees as well as litigation
expenses; and (3) costs of suit.

On 30 November 2006, the RTC granted UCPB's prayer for a writ of preliminary
attachment. Summonses and copies of the order granting the writ were served
on the [therein] defendants on 4 December 2006. On the same day, the Sheriff
levied a Toyota Land Cruiser with plate number XRK-783 allegedly owned by
the [therein] defendants. The following day, [therein] defendants' interests in
stocks and shares and other assets in NPGI and NGI were garnished.

On 18 December 2006, [therein] defendants filed a Motion to Dismiss with

Manifestation6 alleging that the RTC did not acquire jurisdiction over their
persons. Where a defendant is a corporation, service of summons may be made
on the president, managing partner, general manager, corporate secretary or
in-house counsel. This list is exclusive and does not include a mere employee
like Charlotte Magpayo, NPGI's Property Supply Custodian (OIC). The RTC did
not also acquire jurisdiction over the persons of the spouses Allyson Ang-Sy
and Guillermo Sy, Renato Ang, Nena Ang, Ricky Ang and Derick Chester Sy as
personal service of summons was not first resorted to before substituted
service was effected. Defendants thus prayed for the dismissal of the
[C]omplaint for lack of jurisdiction, the discharge of the writ of attachment on
their properties, and the suspension of further proceedings because a Stay
Order had been issued against NGI and NPGI.

UCPB opposed the motion insisting that there was valid service of summons or,
at the very least, substantial compliance of the rules. If not, [therein]
defendants are deemed to have voluntarily submitted to the jurisdiction of the
RTC when it prayed for an alternative relief other than dismissal in its [M]otion
to [D]ismiss.

On 8 June 2007, the RTC granted the suspension of proceedings with respect
to defendants NGI and NPGI but denied defendants' [M]otion to Dismiss x x x.

[Therein] [defendants' [M]otion for [Reconsideration was denied. Hence, [the

Sps. Ang-Sy, et al. filed a Petition for Certiorari and Prohibition 7 under Rule 65
of the Rules of Court imputing grave abuse of discretion on the part of the RTC
when it denied their Motion to Dismiss through its Order dated June 8, 2007.] 8

The Ruling of the CA

In its assailed Decision, the CA granted the Rule 65 Petition filed by
respondents Sps. Sy, et al., reversing and setting aside the RTC's Order dated
June 8, 2007:

FOR THE STATED REASONS, the petition is GRANTED. The assailed RTC
[O]rder dated 8 June 2007 is REVERSED and SET ASIDE.

SO ORDERED.9 (Emphasis in the original)

The CA held that the RTC failed to acquire jurisdiction over the persons of the
therein defendants due to improper service of summons. Hence, "all
proceedings before the [RTC] and the subsequent [Order] [are] void. [Therein]
[d]efendants-petitioners are not bound by it."10

On February 29, 2012, petitioner UCPB filed with the CA a Motion for
Reconsideration11 (MR) of the assailed Decision. The MR was denied by the CA
in its assailed Resolution12 dated December 7, 2012.

Hence, petitioner UCPB filed the instant Petition for Review 13 asking the Court
to reverse the CA's assailed Decision and Resolution.

Issue

In the instant Petition, petitioner UCPB posits two issues for the Court's
consideration, i.e., (1) whether the CA committed an error of law when it found
that the RTC did not acquire jurisdiction over the therein defendant
corporations, even when such corporations failed to assail the RTC's Order;
and (2) whether the CA committed an error of law in finding that the RTC did
not acquire jurisdiction over the persons of the Sps. Sy, et al.

Stripped to its core, the critical question to be resolved by the Court is whether
the RTC acquired jurisdiction to hear petitioner UCPB's Complaint.

The Court's Ruling

The aforesaid question should be answered in the negative; the instant appeal
is denied.

Jurisdiction refers to the power and authority of the court to hear, try, and
decide a case.14 One of the aspects of jurisdiction is jurisdiction over the
parties. This refers to the fundamental rule that jurisdiction over a defendant
in a civil case is acquired either through: (1) service of summons or through
(2) voluntary appearance in court and submission to its authority.15

The service of summons undertaken in the instant case is undoubtedly

defective.

According to the Rules of Court, upon the filing of the complaint and the
payment of the requisite legal fees, the clerk of court shall forthwith issue the
corresponding summons to the defendants.16 The summons shall be served by
handling a copy thereof to the defendant in person.17 Only in instances
wherein, for justifiable causes, the defendant cannot be served within a
reasonable time, may summons be effected through substituted service, i.e., (a)
by leaving copies of the summons at the defendant's residence with some
person of suitable age and discretion then residing therein, or (b) by leaving the
copies at defendant's office or regular place of business with some competent
person in charge thereof.18 With respect to parties that are domestic private
juridical entities, service may be made only upon the president, managing
partner, general manager, corporate secretary, treasurer, or in-house
counsel.19

In the absence of service of summons or when the service of summons upon

the person of the defendant is defective, the court acquires no jurisdiction
over his person, and the proceedings and any judgment rendered are null
and void.20

At the outset, it must be stressed that the fact that service of summons was
defective in the instant case is undisputed.

The evidence on record, specifically the Sheriff's Report, 21 indubitably shows

that the established jurisprudential doctrine on the prerequisites for valid
substituted service was not observed, i.e., for substituted service of summons
to be available, there must be several attempts by the sheriff, which means at
least three tries, preferably on at least two different dates. 22

It is crystal clear that there were no several attempts made to effect personal
service in the instant case; as correctly found by the court a quo, there was
only a single day's effort to personally serve summons upon the therein
defendants.

Further, as also correctly found by the CA, the Sheriff's Report miserably failed
to indicate that the person who received the summons was a person of suitable
age and discretion residing in the residence of the therein defendants. Nor is
there a statement that validates that such person understood the significance
of the receipt of the summons and the correlative duty to immediately deliver
the same to the therein defendants or, at the very least, to notify the said
persons immediately. Jurisprudence is clear and unequivocal in making it an
ironclad rule that such matters "must be clearly and specifically described in
the Return of Summons."23
As regards the service of summons undertaken with respect to the therein
defendant corporations, i.e., NGI and NPGI, the CA was also not mistaken in
holding that since the summons were served on a mere OIC property supply
custodian, the services of summons undertaken were defective.

Section 11, Rule 14 of the Rules of Court sets out an exclusive enumeration of
the officers who can receive summons on behalf of a corporation. Service of
summons to someone other than the corporation president, managing partner,
general manager, corporate secretary, treasurer, and in-house counsel is not
valid.24

It must be emphasized that even the RTC's Order, which petitioner UCPB aims
to reinstate, does not make any refutation with respect to the fact that the
service of summons undertaken was defective.

In fact, a perusal of the instant Petition would show that petitioner UCPB does
not refute at all that substituted service was undertaken despite the fact that
there were no several attempts to personally serve the summons on different
dates, and that the summons with respect to the therein defendant
corporations was made upon a person other than the defendant corporations'
president, managing partner, general manager, corporate secretary, treasurer,
and in-house counsel.

Bearing in mind the foregoing, the critical question now redounds to whether
there was voluntary appearance on the part of respondents Sps. Sy, et al. that
cures the defective service of summons.

There was no voluntary submission to the jurisdiction of the RTC on the

part of respondents Sps. Sy, et al.

Indeed, despite lack of valid service of summons, the court can still acquire
jurisdiction over the person of the defendant by virtue of the latter's voluntary
appearance.25 According to the Rules of Court, the defendant's voluntary
appearance in the action shall be equivalent to service of summons. However,
the inclusion in a motion to dismiss of other grounds aside from lack of
jurisdiction over the person of the defendant shall not be deemed a voluntary
appearance.26

As a general rule, one who seeks an affirmative relief is deemed to have

submitted to the jurisdiction of the court. Thus, it has been held that the filing
of motions to admit answer, for additional time to file answer, for
reconsideration of a default judgment, and to lift order of default with motion
for reconsideration is considered voluntary submission to the trial court's
jurisdiction.27
Both petitioner UCPB and the RTC posit the view that since respondents Sps.
Sy, et al., in their Motion to Dismiss, included a plea to suspend the
proceedings in view of the Stay Order issued by another court, they thus
sought an affirmative relief which should be deemed a voluntary submission to
the jurisdiction of the court.

Such view is mistaken.

As held in the very recent case of Interlink Movie Houses, Inc., et al. v. Court of
Appeals, et al.28 (Interlink Movie Houses, Inc.), the abovementioned general rule
is tempered by the concept of conditional appearance, such that a party who
makes a special appearance to challenge, among others, the court's jurisdiction
over his person cannot be considered to have submitted to its authority. 29

As explained by the Court in the aforesaid case, citing Philippine Commercial

International Bank v. Spouses Dy, et al.,30 a special appearance operates as an
exception to the general rule on voluntary appearance when the defendant
explicitly and unequivocably poses objections to the jurisdiction of the
court over his person.31

The Court in Interlink Movie Houses, Inc. explained that while at first glance,
the therein respondents may be seen to have submitted themselves to the
jurisdiction of the RTC by praying for an affirmative relief, there was an explicit
objection made by the parties, in an unequivocal manner, to the jurisdiction of
the court on the ground of invalid service of summons. This convinced the
Court that the therein respondents never recognized and did not acquiesce to
the jurisdiction of the RTC despite the fact that the said party prayed for an
affirmative relief.32

Applying the foregoing principles to the instant case, while it is true that
respondents Sps. Sy, et al. did pray in their Motion to Dismiss for a suspension
of the proceedings due to a Stay Order issued by a different court, which is an
affirmative relief, such was not tantamount to a voluntary appearance as
respondents Sps. Sy, et al., in an explicit and unequivocal manner, posed
vehement objections to the jurisdiction of the RTC over their persons due
to improper service of summons.33 Therefore, following what is already
settled jurisprudence, the general rule that asking for an affirmative relief is
tantamount to voluntary submission to the jurisdiction of the court should not
be applied in the instant case.

In supporting their view that respondents Sps. Sy, et al.'s raising of an

affirmative relief cured the defective service of summons, petitioner UCPB cites
the Court's ruling in NM Rothschild & Sons (Australia) Limited v. Lepanto
Consolidated Mining Company,34 which in turn cited Philippine Commercial
International Bank v. Spouses Dy, et al.35 Petitioner UCPB placed much
emphasis on the Court's pronouncement in the aforesaid cases that "by
seeking affirmative relief other than dismissal of the case, respondents
manifested their voluntary submission to the court's jurisdiction." 36

Regrettably, the petitioner UCPB failed to place the foregoing pronouncement of

the Court in the proper context.

In Philippine Commercial International Bank v. Spouses Dy, et al., it should be

emphasized that the pleading which contained certain affirmative reliefs "did
not categorically and expressly raise the jurisdiction of the court over
their persons as an issue."37

Oppositely, respondents Sps. Sy, et al. plainly and unmistakably questioned

the jurisdiction of the RTC over their persons due to improper service of
summons.38 Hence petitioner UCPB's theory lacks any jurisprudential support.

As a final note, petitioner UCPB also made the argument that the CA
purportedly committed an error of law because it held that the RTC did not
acquire jurisdiction with respect to the therein defendant corporations even
when such corporations failed to question the RTC's Order before the CA.

Such argument fails to convince. The courts may dismiss an action when there
is lack of jurisdiction, even though the issue of jurisdiction was not raised by
the pleadings or not even suggested by the parties. Issues of jurisdiction are
not subject to the whims of the parties. 39 Even if a party does not question the
jurisdiction of the court to hear and decide the pending action, the courts are
not prevented from addressing the issue, especially where the lack of
jurisdiction is apparent and explicit.40

Therefore, the Petition is without merit.

WHEREFORE, the appeal is hereby DENIED. The Decision dated February 10,
2012 and Resolution dated December 7, 2012 issued by the Court of Appeals
Special Twelfth Division, and Former Special Twelfth Division, respectively, in
CA-G.R. SP No. 102725 are AFFIRMED.

SO ORDERED.

Carpio (Chairperson), Perlas-Bernabe, J. Reyes, Jr., and Lazaro-Javier, JJ.,

concur.
Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 177598 October 17, 2008

ROBERT SAN PEDRO, petitioner,

vs.
WILLY ONG and NORMITA CABALLES, respondents.

DECISION

CHICO-NAZARIO, J.:

Before this Court is a Petition for Review on Certiorari under Rule 45 of the
Revised Rules of Court, filed by petitioner Robert San Pedro (San Pedro),
seeking to reverse and set aside the Decision 1 of the Court of Appeals dated 29
December 2006 and its Resolution 2 dated 13 April 2007 in CA-G.R. CV No.
79399. In its assailed Decision, the Court of Appeals reversed the
Decision3 dated 21 February 2003 of the Regional Trial Court (RTC) of Malolos,
Bulacan, Branch 19, in Civil Case No. 515-M-99, declaring, inter alia, that the
deeds of real estate mortgage constituted on the subject properties are null and
void; while, in its assailed Resolution, the appellate court denied San Pedro’s
Motion for Reconsideration.

The factual and procedural antecedents of this case are as follows:

On 3 April 1996, San Pedro purchased from the spouses Guillermo Narciso
and Brigida Santiago (spouses Narciso) two parcels of land (subject properties)
covered by Transfer Certificates of Title TCTs No. T-82381 and No. T-82382 of
the Registry of Deeds of Bulacan, with areas of about 200 square meters and
150 square meters, respectively. San Pedro bought the subject properties for
₱35,000.00, as evidenced by Deeds of Sale executed in his favor by the spouses
Narciso on 8 April 1996.4

In order to transfer in his name the TCTs covering the subject properties, and
upon the spouses Narciso’s recommendation, San Pedro hired the services of
Adora Dela Peña (Dela Peña) who is known to be very familiar with the
intricacies of real property transfers.5

After sometime, San Pedro inquired with the Registry of Deeds of Bulacan as to
the status of his application for the issuance in his name of new TCTs for the
subject properties. He was surprised to find out, however, that the subject
properties were still registered in the names of the Narciso spouses and were
mortgaged to Willy Ong (Ong).6

According to the annotation stamped at the back of TCTs No. T-82381 and No.
T-82382, the spouses Narciso, on 23 July 1998, executed Special Powers of
Attorney (SPAs) authorizing Dela Peña to mortgage the subject properties to
Ong. The SPAs were procured by Dela Peña from the spouses Narciso with the
help of one Rufino Landayan, a tricycle driver who accompanied Dela Peña to
the spouses Narciso’s residence. San Pedro found out that it was Normita
Caballes (Caballes), Ong’s agent, who caused the registration of the mortgages
with the Registry of Deeds of Bulacan and the annotation thereof on the TCTs
of the spouses Narciso.7

In order to free the subject properties from the said encumbrances, San Pedro
filed with the RTC on 7 May 1999 a Petition for Nullification of Mortgage with
Damages against the spouses Narciso, Dela Peña, Landayan, Ong, and
Caballes, docketed as Civil Case No. 515-M-99.

On 14 May 1991, the RTC issued summons to spouses Narciso, Dela Peña,
Landayan, Ong, and Caballes, directing them to file their Answers to San
Pedro’s Petition in Civil Case No. 515-M-99. On the same day, the Sheriff
served the summons on all concerned as evidenced by the Sheriff’s
Return,8 which reads:

SERVICE RETURN

THIS IS TO CERTIFY that on 14 th day of May 1999, the undersigned served a

copies (sic) of Summons in connection in (sic) the above-entitled case
accompanying (sic) by the Complaints with annexes attached thereto upon
defendants, at their given address, to wit:

Spouses Brigida Santiago & thru their son Jaime

Guillermo Narciso Narciso/
-

Received & sign

Adora Dela Peña thru her sister-in-law/
-
Received but refused to sign
Rufino Landayan thru his son Christopher
-
Landayan/received & sign
Normita Caballes & thru Paul Caballes son of
Willy Ong - Normita Caballes/received
& sign

The original copy of Summons is, therefore, respectfully returned DULY

SERVED.

While the spouses Narciso, Landayan, Ong, and Caballes separately filed their
Answers in accordance with the summons, thereby voluntarily submitting
themselves to the jurisdiction of the RTC, Dela Peña failed to do so and she
was, thus, declared by the RTC to be in default.

In their Answer,9 the spouses Narciso admitted to selling the subject properties
to San Pedro, and denied authorizing the mortgage of the same to Ong. Their
signatures on the SPAs were fraudulently secured by Dela Peña who
misrepresented to them that such document was necessary to facilitate the
transfer of the TCTs of the subject properties to San Pedro. The spouses
Narciso denied that they participated in or benefited from the loan obligation
obtained by Dela Peña from Ong.

For their part, Caballes and Ong raised in their Joint Answer 10 the defense of
mortgagee-in-good-faith. They claimed that they both relied in good faith on the
SPAs granting Dela Peña the authority to mortgage the subject properties since
there was nothing on the face thereof which would have raised their suspicion
as to the authenticity of the document. Ong alleged that the subject properties
were used by Dela Peña as collateral for the loan, amounting to ₱170,000.00,
which she obtained from Ong. Since the said loan obligation already became
due and demandable, Ong sought the foreclosure of the subject properties.
During the auction sale, Ong emerged as the highest bidder but the TCTs of
the subject properties were not yet transferred to his name.

Landayan, in his Answer,11 denied any participation in the procurement of the

SPAs or in the mortgage of the subject properties, except that he was hired by
Dela Peña to bring her to the spouses Narciso’s residence at the time the
alleged SPAs were fraudulently procured.

After the Pre-Trial Conference, trial on the merits ensued.

During the trial, San Pedro presented Landayan to testify in his favor.
According to Landayan, he came to know Dela Peña when the latter hired his
tricycle. Landayan took Dela Peña and a woman, whom he identified as
Caballes’ sister, to the residence of the spouses Narciso to secure Guillermo
Narciso’s signature on a certain document. While Dela Peña and Caballes’
sister were inside the spouses Narciso’s house, Caballes was waiting for them
outside in a white car. After a few minutes, Dela Peña and Caballes’ sister
came out, and together with Caballes, they visited and inspected the subject
properties; after which, Dela Peña and Caballes’ sister proceeded to a
restaurant to try and secure Brigida Santiago’s signature on the document they
carried. After somebody signed the document for Brigida Santiago, Dela Peña
asked Landayan to sign the same as witness, to which he obliged. 12

San Pedro himself took the witness stand. He testified that he bought the
subject properties from the spouses Narciso for ₱35,000.00. After the execution
of the Deeds of Sale and payment of the purchase price to the spouses Narciso,
possession of the subject properties were turned over to him. San Pedro started
to build his dream house on the subject properties, spending about
₱2,000,000.00 thereon, only to find out later on that the subject properties on
which his house was built was encumbered by Dela Peña to Ong on the
strength of the SPAs executed by the spouses Narciso in Dela Peña’s favor.
When San Pedro confronted the spouses Narciso about the mortgages, they
denied authorizing the same.13

San Pedro’s sister, Luz San Pedro Tominago (Tominago), narrated before the
RTC that on 31 March 1991, she filed a complaint against Dela Peña before the
Philippine National Police (PNP) Station in Balagtas, Bulacan for the latter’s
failure to effect the transfer of the TCTs of the subject properties in San Pedro’s
name, as she was obliged to do. Tominago filed the complaint on behalf of San
Pedro, who was working abroad.14
Finally, a document examiner and handwriting expert from the National
Bureau of Investigation (NBI) was also presented as a witness for San Pedro.
He confirmed that the signature of Guillermo Narciso on one of the SPAs was
forged, while the signatures of his wife Brigida Santiago on both SPAs were
spurious.15

After San Pedro presented his evidence, Ong and Caballes filed a demurrer to
evidence, questioning the lack of jurisdiction of the RTC over the person of Dela
Peña. Since Dela Peña was an indispensable party in the case, they claimed
that no final determination of the same could be arrived at without the said
court acquiring jurisdiction over Dela Peña.16

In an Order dated 24 August 2001, the RTC denied the demurrer to evidence
filed by Ong and Caballes. Hence, trial proceeded with the presentation of
evidence by the defense.

Ong testified for the defense that Caballes informed him that she knew of two
parcels of land in Bulacan that were being offered as collaterals for a loan.
When Ong expressed interest in the subject properties, Caballes showed him
copies of the SPA executed by the spouses Narciso in favor of Dela Peña. Ong
then instructed Caballes to verify with the Registry of Deeds whether the
spouses Narciso were the real owners of the subject properties and whether
their TCTs were clean. Caballes returned with certified true copies of the TCTs
which were in the names of the spouses Narciso and bore no encumbrances.
Satisfied with the documents, Ong agreed to release the amount of
₱170,000.00 as loan, secured by the subject properties. Ong admitted that he
was not able to personally talk to Dela Peña or to the spouses Narciso. All
negotiations pertaining to the loan and mortgages were transacted through
Caballes.17

Caballes also offered her testimony, in which she stated that she came to know
Dela Peña because the latter was looking for someone who can grant her a loan
with the subject properties as collateral. Dela Peña was armed with the SPAs
from the spouses Narciso authorizing her to mortgage the subject properties.
After Caballes examined the documents, she proceeded to the Registry of Deeds
of Bulacan to verify the status and ownership of the subject properties. After
she found out that the TCTs were in the name of the spouses Narciso and were
clean, Caballes went to Ong who released the money for the loan. Dela Peña
issued nine post-dated checks to Ong as payment for her loan obligation. All
nine checks were dishonored by the drawee bank when presented for payment
because Dela Peña’s account was already closed. Ong, thus, instituted before
the Municipal Trial Court (MTC) of Balagtas, Bulacan, a case against Dela Peña
for violation of Batas Pambansa Blg. 22.18
On 21 February 2003, the RTC rendered a Decision in Civil Case No. 515-M-
99, declaring null and void the mortgages constituted over the subject
properties in Ong’s favor. According to the court a quo, Ong and Caballes failed
to exercise reasonable degree of diligence before they entered into mortgage
contracts with Dela Peña, who was not the registered owner of the properties
being mortgaged and was only purportedly authorized by the registered owners
thereof. The RTC, thus, ruled:

WHEREFORE, judgment is hereby rendered as follows:

1. Declaring [San Pedro] the legal and rightful owner of the two (2) parcels of
land subject of this litigation, covered by TCT No. T-82381 and TCT No. 82382
presently in the name of [the spouses Narciso].

2. Adjudging the sale by [the spouses Narciso] to [San Pedro], legal, valid,
subsisting and in all respect enforceable.

3. Resolving to declare the Special Power[s] of Attorney constituted in favor of

[Dela Peña] null and void.

4. Declaring the Deeds of Mortgage purportedly executed by [Dela Peña] as

Attorney-in-fact of [the spouses Narciso], in favor of [Ong] constituted in [sic]
TCT No. T-82381 and TCT No. 82382 void ab initio.

5. Ordering the Registry of Deeds for the Province of Bulacan to cancel the
recordings of mortgages in favor of Ong constituted in [sic] TCT No. 82381 and
TCT No. 82382 as well as any annotation of foreclosure proceedings if there are
any by [Ong].

6. Ordering [Ong] to return to [San Pedro] the owner’s duplicate copy of TCT
No. 82381 and TCT No. 82382 which are presently in his possession.

7. Ordering [Dela Peña] to pay [Ong] the sum of P245,000.00 plus legal interest
from September, 1998 until the whole obligation is fully extinguished.

All other claims, counterclaims and cross claims are ordered denied for lack of
merit.19

Without filing any Motion for Reconsideration before the RTC, Ong and
Caballes appealed the adverse RTC Decision to the Court of Appeals, assigning
as error the lack of jurisdiction of the RTC over the person of Dela Peña which
rendered all the proceedings held before said court fatally defective. Their
appeal was docketed as CA-G.R. CV No. 79399.

In a Decision20 dated 29 December 2006, the Court of Appeals granted the

appeal of Ong and Caballes, and accordingly reversed the RTC Decision dated
21 February 2003. The appellate court justified its reversal of the ruling of the
RTC on its finding that the service of summons on Dela Peña was invalid; thus,
the RTC did not acquire jurisdiction over her person. The substituted service of
summons employed by the Sheriff was ineffective for failure to comply with the
statutory requirements before such mode of service could be resorted to. The
Sheriff in the present case used substituted service without even showing that
Dela Peña could not be served personally with the summons within reasonable
time. Since Dela Peña was an indispensable party to the controversy, without
her no final determination of the case can be had. Thus, the dispositive portion
of the assailed Court of Appeals Decision reads:

WHEREFORE, all the above premises considered, the Decision, dated February
21, 2003, of the Regional Trial Court of Malolos, Bulacan, Branch 19, is hereby
set aside for want of jurisdiction. The instant case is hereby remanded to the
court a quo for appropriate proceedings. No costs.21

The Motion for Reconsideration filed by San Pedro was denied by the Court of
Appeals in its Resolution22 dated 13 April 2007 for the issues raised therein
were already sufficiently threshed out in its Decision.

San Pedro is now before this Court assailing the adverse decision rendered by
the Court of Appeals.23 For the resolution of this Court are the following issues:

I.

WHETHER OR NOT THE RTC HAS JURISDICTION TO HEAR AND DECIDE

THE CASE FILED BY SAN PEDRO.

II.

WHETHER OR NOT DE LA PEÑA IS AN INDISPENSABLE PARTY TO THE

CASE.

III.

WHETHER OR NOT ONG WAS MORTGAGEE-IN-GOOD FAITH.

Vital to the resolution of the present controversy are the questions on whether
there was a valid service of summons upon Dela Peña; and if there was none,
whether the improper service of summons on Dela Peña invalidates the entire
proceedings before the court a quo.

Summons is a writ by which the defendant is notified of the action brought

against him. Service of such writ is the means by which the court may acquire
jurisdiction over his person. Any judgment without such service in the absence
of a valid waiver is null and void.24
To provide perspective, it is crucial to determine first whether the action is in
personam, in rem, or quasi in rem because the rules on service of summons
under Rule 14 of the Revised Rules of Court apply according to the nature of
the action.25

In the case at bar, Civil Case No. 515-M-99, instituted by San Pedro, is
anchored on his claim that he is the real and rightful owner of the subject
properties, thus, no one else has the right to mortgage them. The real estate
mortgages constituted on the subject properties in favor of Ong, annotated on
their TCTs, are encumbrances on said properties, which may be considered a
cloud on San Pedro’s title thereto.

Such cloud may be removed or San Pedro’s title quieted under Article 476 of
the Civil Code, which reads:

Art. 476. Whenever there is a cloud on title to real property or any interest
therein, by reason of any instrument, record, claim, encumbrance or
proceeding which is apparently valid or effective but is in truth and in fact
invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said
title, an action may be brought to remove such cloud or to quiet the title.

An action may also be brought to prevent a cloud from being cast upon title to
real property or any interest therein. (Emphasis ours.)

San Pedro alleged in his Petition in Civil Case No. 515-M-99 that the mortgages
in favor of Ong may, at first, appear valid and effective, but are actually invalid
or voidable for having been made without the knowledge and authority of the
spouses Narciso, the registered owners of the subject properties and San
Pedro’s predecessors-in-interest. In asking the cancellation of the mortgages on
the TCTs of the subject properties, San Pedro was ultimately asking the RTC to
remove a cloud on his title to the same. It is, thus, irrefragable that Civil Case
No. 515-M-99 is an action for quieting of title.

Significantly, suits to quiet title are characterized as proceedings quasi in rem.

Technically, they are neither in rem nor in personam. In an action quasi in rem,
an individual is named as defendant. However, unlike suits in rem, a quasi in
rem judgment is conclusive only between the parties. A proceeding quasi in
rem is one brought against persons seeking to subject the property of such
persons to the discharge of the claims assailed. 26

In an action quasi in rem, an individual is named as defendant and the purpose

of the proceeding is to subject his interests therein to the obligation or loan
burdening the property. Actions quasi in rem deal with the status, ownership or
liability of a particular property but which are intended to operate on these
questions only as between the particular parties to the proceedings and not to
ascertain or cut off the rights or interests of all possible claimants. The
judgments therein are binding only upon the parties who joined in the action. 27

According to Section 6, Rule 14 of the Revised Rules of Court, summons on the

defendant in actions in personam must be served by handing a copy thereof to
the defendant in person, or, if he refuses to receive it, by tendering it to
him.28 Meanwhile, in actions in rem or quasi in rem, jurisdiction over the
person of the defendant is not a prerequisite to confer jurisdiction on the court
provided that the court acquires jurisdiction over the res, although summons
must be served upon the defendant in order to satisfy the due process
requirements.29
30
In Alba v. Court of Appeals, the Court further elucidated that:

In an action in personam, jurisdiction over the person of the defendant is

necessary for the court to validly try and decide the case. In a proceeding in
rem or quasi in rem, jurisdiction over the person of the defendant is not a
prerequisite to confer jurisdiction on the court, provided that the latter
has jurisdiction over the res. Jurisdiction over the res is acquired either (a)
by the seizure of the property under legal process, whereby it is brought into
actual custody of the law; or (b) as a result of the institution of legal
proceedings, in which the power of the court is recognized and made
effective. The service of summons or notice to the defendant is not for the
purpose of vesting the court with jurisdiction but merely for satisfying the due
process requirements. (Emphasis supplied.)

Given that Civil Case No. 515-M-99 is a an action for quieting of title, settled to
be quasi in rem, the RTC was not required to acquire jurisdiction over the
persons of the defendants, it being sufficient for the said court to acquire
jurisdiction over the subject matter of the case. By San Pedro’s institution of
Civil Case No. 515-M-99, the RTC already acquired jurisdiction over the subject
properties – the res. Therefore, the service of summons to the defendants in
said case, including Dela Peña, did not affect the jurisdiction of the RTC to
hear and decide Civil Case No. 515-M-99, and did not invalidate the
proceedings held therein on the basis of jurisdiction.

Admittedly, there was a defect in the service of the summons on Dela Peña. The
Sheriff immediately resorted to substituted service of summons on Dela Peña
without attempting first to effect personal service within reasonable time. The
Sheriff’s Return31 merely stated that he served a copy of the summons on Dela
Peña’s sister-in-law who refused to sign the same.

Personal service of summons is preferred to substitute service. Only if the

former cannot be made promptly can the process server resort to the latter.
Moreover, the proof of service of summons must (a) indicate the impossibility of
service of summons within a reasonable time; (b) specify the efforts exerted to
locate the defendant; and (c) state that the summons was served upon a person
of sufficient age and discretion who is residing in the address, or who is in
charge of the office or regular place of business, of the defendant. It is likewise
required that the pertinent facts proving these circumstances be stated in the
proof of service or in the officer’s return. The failure to comply faithfully,
strictly and fully with all the foregoing requirements of substituted service
renders the service of summons ineffective.32 Indisputably, the Sheriff did not
comply with any of the foregoing requirements, thus, rendering his service of
summons on Dela Peña invalid.

Nonetheless, the improper service of summons on Dela Peña did not void the
proceedings conducted by the RTC in Civil Case No. 515-M-99, for lack of
jurisdiction. As the Court has underscored herein, in quasi in rem proceedings,
the court need not acquire jurisdiction over the persons of the defendants, for
as long as it has acquired jurisdiction over the res. The defect in the service of
summons merely infringed Dela Peña’s right to due process that precluded the
RTC from rendering a valid judgment with respect to her personal liability. And
since Dela Peña’s right to due process is personal and pertains to her alone, it
could not be invoked by her other co-defendants in Civil Case No. 515-M-99 so
as to escape the judgment of liability against them.

Contrary to the pronouncement of the Court of Appeals, Dela Peña was not an
indispensable party to this case, without whom, no final conclusion of the case
can be arrived at.

The Court defined indispensable party in Philippine National Bank v. Heirs of

Estanislao Militar and Deogracias Militar, 33 as follows:

An indispensable party is one whose interest will be affected by the

court's action in the litigation, and without whom no final determination
of the case can be had. The party's interest in the subject matter of the suit
and in the relief sought are so inextricably intertwined with the other parties'
(sic) that his legal presence as a party to the proceeding is an absolute
necessity. In his absence there cannot be a resolution of the dispute of the
parties before the court which is effective, complete, or equitable.

Conversely, a party is not indispensable to the suit if his interest in the

controversy or subject matter is distinct and divisible from the interest of the
other parties and will not necessarily be prejudiced by a judgment which does
complete justice to the parties in court. He is not indispensable if his presence
would merely permit complete relief between him and those already parties to
the action or will simply avoid multiple litigation. (Emphasis supplied.)

Evidently, Dela Peña does not fall within the definition of an indispensable
party. As the Court has explained, Civil Case No. 515-M-99 is an action for
quieting of title, intended to remove any cloud upon San Pedro’s title to the
subject properties. The real estate mortgages in favor of Ong annotated on the
TCTs of the subject properties constitute the cloud to be removed. Thus, the
crux of the controversy is the title of San Pedro to the subject properties vis-à-
vis that of Ong, for the determination of which, Dela Peña’s participation is not
an absolute necessity. The judgment of the RTC upholding San Pedro’s title to
the subject properties over Ong’s, or even if it were the other way around,
would not have affected Dela Peña, because Dela Peña never claimed title to
the subject properties; she only misrepresented that she had authority to
mortgage the same on behalf of the registered owners, namely, the spouses
Narciso. After she successfully, albeit, fraudulently, obtained the loan using
the subject properties as mortgage, her interest in the same had ended. She
may have perpetrated fraud for which she may be held liable but, clearly, these
may be established in a separate and subsequent case. Her presence in the
proceedings before the RTC would have only permitted complete relief since the
said court could have already determined therein her liability for the damages
she had caused to any of the parties, but it does not make her presence
indispensable.

San Pedro’s title proved to be superior to that of Ong’s. The subject properties
were sold to him prior to the mortgage of the same to Ong. The spouses
Narciso, registered owners of the subject properties, admitted the sale thereof
to San Pedro and denied giving any authority to Dela Peña to mortgage the said
properties. An expert witness affirmed that the signature of Guillermo Narciso
on one of the purported SPAs in favor of Dela Peña was forged, while the
signatures of his wife Brigida Santiago on both SPAs were spurious. Ong and
Caballes cannot even point out any defect in San Pedro’s title to the subject
properties. Ong can only assert better right to the same as allegedly a
mortgagee in good faith.

However, the well-entrenched legal principle in our jurisprudence requires a

higher degree of diligence to be exercised by the mortgagee when he is not
directly dealing with the registered owner of real property. As the Court
enunciated in Abad v. Guimba34:

While one who buys from the registered owner does not need to look behind the
certificate of title, one who buys from one who is not the registered owner is
expected to examine not only the certificate of title but all factual
circumstances necessary for [one] to determine if there are any flaws in the title
of the transferor, or in [the] capacity to transfer the land. Although the instant
case does not involve a sale but only a mortgage, the same rule applies
inasmuch as the law itself includes a mortgagee in the term "purchaser."

The Court has stressed time and again that every person dealing with an agent
is put upon inquiry, and must discover upon his peril the authority of the
agent, and this is especially true where the act of the agent is of unusual
nature. If a person makes no inquiry, he is chargeable with knowledge of the
agent’s authority, and his ignorance of that authority will not be any excuse. 35

In the more recent case of Bank of Commerce v. San Pablo, Jr.,36 the Court
elucidated:

The Bank of Commerce clearly failed to observe the required degree of caution
in ascertaining the genuineness and extent of the authority of Santos to
mortgage the subject property. It should not have simply relied on the face of
the documents submitted by Santos, as its undertaking to lend a considerable
amount of money required of it a greater degree of diligence. That the person
applying for the loan is other than the registered owner of the real
property being mortgaged should have already raised a red flag and which
should have induced the Bank of Commerce to make inquiries into and
confirm Santos’ authority to mortgage the Spouses San Pablo’s property.
A person who deliberately ignores a significant fact that could create
suspicion in an otherwise reasonable person is not an innocent purchaser
for value (Emphasis ours.)

Considering Ong’s undue haste in granting the loan without inquiring into the
ownership of the subject properties being mortgaged, as well as the authority of
the supposed agent to constitute the mortgages on behalf of the owners, he
cannot be considered a mortgagee-in-good-faith. Ong’s averment that he
exercised prudence in the loan-mortgage transaction is debunked by his own
admission that he merely relied on Caballes’ representations thereon,
without personally meeting or speaking with Dela Peña, the supposed agent, or
the spouses Narciso, the registered owners of the subject properties. Although
he instructed Caballes to check the TCTs of the subject properties, he did not
bother to personally meet Dela Peña and ascertain the genuineness and
authenticity of the latter’s authority to mortgage the same on behalf of the
spouses Narciso especially considering that the one mortgaging the property is
not the registered owner.

The real estate mortgages constituted on the subject properties based on false
and fraudulent SPAs are void ab initio. In Veloso and Rosales v. La
Urbana,37 the Court ruled that forged powers of attorney are without force and
effect and, thus, nullified the mortgage constituted on the strength thereof:

In view of the forgoing facts, the court held that pursuant to Article 1714 of the
Civil Code and under the Torrens Act in force in this jurisdiction, the forged
powers of attorney prepared by Del Mar were without force and effect and that
the registration of the mortgages constituted by virtue thereof were likewise
null and void and without force and effect, and that they could not in any way
prejudice the rights of the plaintiff as the registered owner of her participations
in the properties in question.
Consequently, the foreclosure proceedings on the mortgaged properties are
likewise void ab initio. Since Ong cannot be deemed a mortgagee-in-good-faith
nor an innocent purchaser for value of the subject properties at the auction
sale thereof, his claim to the said properties cannot prevail over that of San
Pedro. The Court’s ruling, however, is without prejudice to the right of Ong to
proceed against those who perpetrated the fraud to his prejudice.

WHEREFORE, in view of the foregoing, the instant Petition is GRANTED. The

Decision dated 29 December 2006 rendered by the Court of Appeals in CA-G.R.
CV No. 79399 is REVERSED and SET ASIDE. The Decision dated 21 February
2003 of the Regional Trial Court of Malolos, Bulacan, Branch 19, in Civil Case
No. 515-M-99, is hereby REINSTATED with the modification that the portion
ordering Adora Dela Peña to pay Willy G. Ong the sum of ₱245,000.00 plus
legal interest, is DELETED.

SO ORDERED.